Full Text of SB0397 97th General Assembly
SB0397eng 97TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Section 5. The Department of Revenue Law of the
Civil | 5 | | Administrative Code of Illinois is amended by adding Section | 6 | | 2505-660 as follows: | 7 | | (20 ILCS 2505/2505-660 new) | 8 | | Sec. 2505-660. Collection of delinquent debts; housing | 9 | | authority. Upon certification by a housing authority of the | 10 | | amounts of delinquent debts, the Department of Revenue may | 11 | | collect the delinquent debts by intercepting the tax refund of | 12 | | any person owing the delinquent debts. The Department of | 13 | | Revenue shall enter into an agreement with the housing | 14 | | authority as provided in Section 8.1d of the Housing | 15 | | Authorities Act prior to undertaking any collections under this | 16 | | Section. Any agreement between the Department of Revenue and | 17 | | the housing authority for the intercept of tax refunds shall | 18 | | contain provisions for certification of debt, notification to | 19 | | the taxpayer of the intercept, and treatment of joint returns | 20 | | that are consistent with the requirements for a refund | 21 | | withholding request under Section 8.1d of the Housing | 22 | | Authorities Act. |
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| 1 | | Section 10. The Illinois Income Tax Act is amended by | 2 | | changing Section 911.3 as follows:
| 3 | | (35 ILCS 5/911.3)
| 4 | | Sec. 911.3. Refunds withheld; order of honoring requests. | 5 | | The Department shall honor refund withholding requests in the | 6 | | following order:
| 7 | | (1) a refund withholding request to collect an unpaid | 8 | | State tax;
| 9 | | (2) a refund withholding request to collect certified | 10 | | past due child
support amounts under Section 2505-650 of | 11 | | the Department of Revenue Law of the
Civil
Administrative | 12 | | Code of Illinois;
| 13 | | (3) a refund withholding request to collect any debt | 14 | | owed to the State;
| 15 | | (4) a refund withholding request made by the Secretary | 16 | | of the Treasury of
the United States, or his or her | 17 | | delegate, to collect any tax liability arising
from Title | 18 | | 26 of the United States Code;
| 19 | | (5) a refund withholding request pursuant to Section | 20 | | 911.2 of this Act; and
| 21 | | (6) a refund withholding request to collect certified | 22 | | past due fees owed to the Clerk of the Circuit Court as | 23 | | authorized under Section 2505-655 of the Department of | 24 | | Revenue Law of the Civil Administrative Code of Illinois ; | 25 | | and .
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| 1 | | (7) a refund withholding request to collect a | 2 | | delinquent debt owed to a housing authority as authorized | 3 | | under Section 2505-660 of the Department of Revenue Law of | 4 | | the Civil Administrative Code of Illinois. | 5 | | (Source: P.A. 92-826, eff. 8-21-02; 93-836, eff. 1-1-05.)
| 6 | | Section 15. The Housing Authorities Act is amended by | 7 | | adding Section 8.1d as follows: | 8 | | (310 ILCS 10/8.1d new) | 9 | | Sec. 8.1d. Collection of debt; setoff program. | 10 | | (a) Definitions. As used in this Section: | 11 | | "Debtor" means a person having a delinquent debt with a | 12 | | housing authority which has not been adjusted, satisfied, or | 13 | | set aside by court order, or discharged in bankruptcy. | 14 | | "Delinquent debt" means a sum which has been reduced to | 15 | | judgment in a final court order and is due and owing a housing | 16 | | authority, including collection costs, court costs, fines, | 17 | | penalties, and interest which have accrued through contract, | 18 | | subrogation, tort, operation of law, or other legal theory. | 19 | | "Delinquent debt" does not include sums owed to a housing | 20 | | authority when the housing authority and the debtor have | 21 | | entered into a written payment agreement and the debtor is | 22 | | current in meeting the obligations of the agreement. | 23 | | "Delinquent debt" also includes any fine, penalty, cost, fee, | 24 | | assessment, surcharge, service charge, restitution, or other |
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| 1 | | amount imposed by a court or as a direct consequence of a final | 2 | | court order which is received by or payable to the clerk of the | 3 | | appropriate court or treasurer of the entity where the court is | 4 | | located. | 5 | | "Refund" means any individual Illinois income tax refund | 6 | | payable. "Refund" also includes a refund belonging to a debtor | 7 | | resulting from the filing of a joint income tax return. | 8 | | (b) Collection of debt; information to be given by housing | 9 | | authority; information to be given by Department of Revenue to | 10 | | housing authority. | 11 | | (1) The collection remedy under this Section is in | 12 | | addition to any other remedy available by law. | 13 | | (2) Housing authorities may submit for collection | 14 | | under the procedure established by this Section all | 15 | | delinquent debts which they are owed. | 16 | | (3) All housing authorities, whenever possible, shall | 17 | | obtain the full name, social security number, address, and | 18 | | any other identifying information, required by rules | 19 | | promulgated by the Department of Revenue for | 20 | | implementation of this Section, from any person for whom | 21 | | the housing authorities provide any service or transact any | 22 | | business and who the housing authorities can foresee may | 23 | | become a debtor under the terms of this Section. | 24 | | (4) Upon request from a housing authority, the | 25 | | Department of Revenue shall furnish to the housing | 26 | | authority any information the Department of Revenue deems |
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| 1 | | necessary to properly notify the debtor. | 2 | | (c) Choice of housing authority as to use of or | 3 | | participation in setoff program. If the housing authority | 4 | | determines that the administrative cost of utilizing this | 5 | | Section is prohibitive, it may choose not to participate in the | 6 | | setoff program, or it may choose to participate only in cases | 7 | | of delinquent debts above an amount it determines appropriate. | 8 | | (d) Department of Revenue to assist in collection of | 9 | | delinquent debt by setoff of any refunds due to debtor. Subject | 10 | | to the limitations contained in this Section, the Department of | 11 | | Revenue, upon request, shall render assistance in the | 12 | | collection of any delinquent debt owing to any housing | 13 | | authority by setting off any refunds due the debtor from the | 14 | | Department of Revenue by the sum certified by the housing | 15 | | authority as delinquent debt. | 16 | | (e) Notification by housing authority; refund | 17 | | determinations; Department of Revenue liability. | 18 | | (1) A housing authority seeking to attempt collection | 19 | | of a delinquent debt through setoff shall notify the | 20 | | Department of Revenue in writing and supply information the | 21 | | Department of Revenue determines necessary to identify the | 22 | | debtor whose refund is sought to be set off. A request for | 23 | | setoff may be made only after the housing authority has | 24 | | notified the debtor of its intention to cause the debtor's | 25 | | refund to be set off. The housing authority shall promptly | 26 | | notify the debtor when the liability out of which the |
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| 1 | | setoff arises is satisfied. The housing authority shall | 2 | | promptly notify the Department of Revenue of a reduction in | 3 | | the delinquent debt. | 4 | | (2) Upon receiving the certification of the housing | 5 | | authority of the amount of the delinquent debt, the | 6 | | Department of Revenue shall determine if the debtor is due | 7 | | a refund. If the debtor is due a refund of more than a | 8 | | tolerance amount as determined by the Department of | 9 | | Revenue, the Department of Revenue shall set off the | 10 | | delinquent debt against the amount of the refund. The | 11 | | Department of Revenue may retain an amount not to exceed | 12 | | $25 of each refund set off to defray its administrative | 13 | | expenses, and that amount may be added to the debt. | 14 | | Apportionment is not required in the case of a refund | 15 | | resulting from filing a joint return. A person has no | 16 | | property right or property interest in a refund until all | 17 | | amounts due the State and housing authorities are paid. The | 18 | | Department of Revenue shall consider a delinquent debt and | 19 | | debtor list provided by a housing authority as correct and | 20 | | the Department of Revenue is not liable for a wrongful or | 21 | | improper setoff. | 22 | | (f) Notice of intention to set off debt; form, delivery and | 23 | | presumption. The notice of intention to set off must be given | 24 | | by mailing the notice, with postage prepaid, addressed to the | 25 | | debtor at the address provided to the housing authority when | 26 | | the debt was incurred or at the debtor's last known address. If |
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| 1 | | the notice is returned to the housing authority as | 2 | | undeliverable or the housing authority has any reason to | 3 | | believe the debtor did not receive the notice, the housing | 4 | | authority shall obtain the last known address of the debtor | 5 | | from the Department of Revenue and resend the notice. The | 6 | | giving of the notice by mail is complete upon mailing the | 7 | | notice or resending the notice if the notice is returned to the | 8 | | housing authority as undeliverable or the housing authority has | 9 | | any reason to believe the debtor did not receive the notice. A | 10 | | certification by the housing authority that the notice has been | 11 | | sent is presumptive proof that the requirements as to notice | 12 | | are met, even if the notice actually has not been received by | 13 | | the debtor. The notice must include a statement substantially | 14 | | as follows: | 15 | | "According to our records, you owe the (housing authority) | 16 | | a debt in the amount of (amount of the debt), plus interest, if | 17 | | applicable, for (type of debt). You are hereby notified of the | 18 | | (housing authority's) intention to submit this debt to the | 19 | | Illinois Department of Revenue to be set off against your | 20 | | individual income tax refunds until the debt is paid in full. | 21 | | Pursuant to Section 8.1d of the Housing Authorities Act, | 22 | | Section 2505-660 of the Department of Revenue Law of the
Civil | 23 | | Administrative Code of Illinois, and Section 911.3 of the | 24 | | Illinois Income Tax Act, this amount, plus $25 in | 25 | | administrative costs, will be deducted from your Illinois | 26 | | individual income tax refunds unless you fully satisfy this |
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| 1 | | debt with the (housing authority). If you file a joint return | 2 | | with your spouse, this amount will be deducted from the total | 3 | | joint refunds without regard to which spouse incurred the debt | 4 | | or actually withheld the taxes." | 5 | | (g) Agreements; credit to debtor's obligation by housing | 6 | | authority; notification of housing authority to debtor of | 7 | | setoff. | 8 | | (1) A housing authority may enter
into an agreement | 9 | | with the Department of Revenue to establish
a program for | 10 | | the purpose of collecting certain delinquent debts. The
| 11 | | purpose shall be to intercept, in whole or in part, State
| 12 | | income tax refunds due the persons who
owe delinquent debts | 13 | | to the housing authority in order to satisfy delinquent | 14 | | debts. The agreement shall include, but may not be limited | 15 | | to, a certification by the housing authority that the debt | 16 | | claims forwarded to the Department of Revenue are valid, | 17 | | that reasonable efforts have been made to notify persons of | 18 | | the delinquency of the debts, and that the delinquent debts | 19 | | have been reduced to judgment in a final court order. The | 20 | | agreement shall include provisions for payment of the | 21 | | intercept by the Department of Revenue to the housing | 22 | | authority. The agreement may also include provisions to | 23 | | allow the Department of Revenue to recover its cost for | 24 | | administering the program. Intercepts made pursuant to | 25 | | this Section shall not interfere with the collection of | 26 | | debts related to child support. During the collection of |
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| 1 | | debts under this Section, when there are 2 or more debt | 2 | | claims certified to the Department of Revenue at the same | 3 | | time, priority of collection shall be as provided in | 4 | | Section 911.3 of the Illinois Income Tax Act. | 5 | | (2) Upon receipt by a housing authority of proceeds | 6 | | collected on its behalf by the Department of Revenue, the | 7 | | housing authority shall credit the debtor's obligation and | 8 | | shall notify the debtor in writing of the amount of the | 9 | | setoff. | 10 | | (3) The Department of Revenue may add an administrative | 11 | | fee of no more than $25 to the delinquent debt. This fee | 12 | | shall be used by the Department of Revenue to cover any | 13 | | administrative costs pursuant to this Section. | 14 | | (h) Information from Department of Revenue to be used only | 15 | | by housing authority for collection purposes; penalties for | 16 | | disclosure. | 17 | | (1) The exchange of information among the Department of | 18 | | Revenue, housing authority, and the debtor pursuant to this | 19 | | Section is lawful. | 20 | | (2) The information obtained by a housing authority | 21 | | from the Department of Revenue in accordance with the | 22 | | exemption allowed by paragraph (1) may be used by the | 23 | | housing authority only in the pursuit of its debt | 24 | | collection duties and practices. A person employed by or | 25 | | formerly employed by the housing authority who knowingly | 26 | | discloses the information for another purpose commits a |
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| 1 | | Class A misdemeanor. | 2 | | (i) Indemnification of Department of Revenue by housing | 3 | | authority. Housing authorities shall indemnify the Department | 4 | | of Revenue against any injuries, actions, liabilities, or | 5 | | proceedings arising from performance under the provisions of | 6 | | this Section. | 7 | | (j) Department of Revenue rules, forms, and procedures | 8 | | permitted. The Department of Revenue may promulgate rules and | 9 | | prescribe forms and procedures necessary to implement this | 10 | | Section. |
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