Full Text of SB1730 98th General Assembly
SB1730enr 98TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Insurance Code is amended by | 5 | | changing Section 412 as follows:
| 6 | | (215 ILCS 5/412) (from Ch. 73, par. 1024)
| 7 | | Sec. 412. Refunds; penalties; collection.
| 8 | | (1) (a) Whenever it appears to
the satisfaction of the | 9 | | Director that because of some mistake of fact,
error in | 10 | | calculation, or erroneous interpretation of a statute of | 11 | | this
or any other state, any authorized company has paid to | 12 | | him, pursuant to
any provision of law, taxes, fees, or | 13 | | other charges
in excess of the
amount legally chargeable | 14 | | against it, during the 6 year period
immediately preceding | 15 | | the discovery of such overpayment, he shall have
power to | 16 | | refund to such company the amount of the excess or excesses | 17 | | by
applying the amount or amounts thereof toward
the | 18 | | payment of taxes, fees, or other charges already due, or | 19 | | which may
thereafter become due from that company until | 20 | | such excess or excesses have been
fully
refunded, or upon a | 21 | | written request from the authorized company, the
Director | 22 | | shall provide a cash refund within
120 days after receipt | 23 | | of the written request if all necessary information has
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| 1 | | been filed with the Department in order for it to perform | 2 | | an audit of the
annual return for the year in which the | 3 | | overpayment occurred or within 120 days
after the date the | 4 | | Department receives all the necessary information to | 5 | | perform
such audit. The Director shall not provide a cash | 6 | | refund if there are
insufficient funds in the Insurance | 7 | | Premium Tax Refund Fund to provide a cash
refund, if the | 8 | | amount of the overpayment is less than $100, or if the | 9 | | amount of
the overpayment can be fully offset against the | 10 | | taxpayer's estimated liability
for the year following the | 11 | | year of the cash refund request. Any cash refund
shall be | 12 | | paid from the Insurance Premium Tax Refund Fund, a special | 13 | | fund hereby
created in the
State treasury.
| 14 | | (b) Beginning January 1, 2000 and thereafter, the | 15 | | Department shall deposit
a percentage of the amounts | 16 | | collected under Sections 409, 444, and 444.1 of
this
Code | 17 | | into the Insurance Premium Tax Refund Fund. The percentage | 18 | | deposited into
the Insurance Premium Tax Refund Fund shall | 19 | | be the annual percentage. The
annual
percentage shall be | 20 | | calculated as a fraction, the numerator of which shall be
| 21 | | the amount of cash refunds approved by the Director for | 22 | | payment and paid during
the preceding calendar year as a | 23 | | result of overpayment of tax liability under
Sections 409, | 24 | | 444, and 444.1 of this Code and the denominator of which | 25 | | shall
be the amounts collected pursuant to Sections 409, | 26 | | 444, and 444.1 of this Code
during the preceding calendar |
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| 1 | | year. However, if there were no cash refunds
paid in a | 2 | | preceding calendar year, the Department shall deposit 5% of | 3 | | the
amount collected in that preceding calendar year | 4 | | pursuant to Sections 409, 444,
and 444.1 of this Code into | 5 | | the Insurance Premium Tax Refund Fund instead of an
amount | 6 | | calculated by using the annual percentage.
| 7 | | (c) Beginning July 1, 1999, moneys in the Insurance | 8 | | Premium Tax Refund
Fund
shall be expended exclusively for | 9 | | the purpose of paying cash refunds resulting
from | 10 | | overpayment of tax liability under Sections 409, 444, and | 11 | | 444.1 of this
Code
as
determined by the Director pursuant | 12 | | to subsection 1(a) of this Section. Cash
refunds made in | 13 | | accordance with this Section may be made from the Insurance
| 14 | | Premium Tax Refund Fund only to the extent that amounts | 15 | | have been deposited and
retained in the Insurance Premium | 16 | | Tax Refund Fund.
| 17 | | (d) This Section shall constitute an irrevocable and | 18 | | continuing
appropriation from the Insurance Premium Tax | 19 | | Refund Fund for the purpose of
paying cash refunds pursuant | 20 | | to the provisions of this Section.
| 21 | | (2) When any insurance company or any surplus line producer | 22 | | fails to
file any tax return required under Sections 408.1, | 23 | | 409, 444, 444.1 and 445 of
this Code or Section 12 of the Fire | 24 | | Investigation Act on the date
prescribed, including any | 25 | | extensions, there shall be added as a penalty
$400 or 10% of | 26 | | the amount of such tax, whichever is
greater, for each month
or |
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| 1 | | part of a month of failure to file, the entire penalty not to | 2 | | exceed
$2,000 or 50% of the tax due, whichever is greater.
| 3 | | (3) (a) When any insurance company or any surplus line | 4 | | producer
fails to pay the full amount due under the | 5 | | provisions of this Section,
Sections 408.1, 409, 444, 444.1 | 6 | | or 445 of this Code, or Section 12 of the
Fire | 7 | | Investigation Act, there shall be added to the amount due | 8 | | as a penalty
an amount equal to 10% of the deficiency.
| 9 | | (b) If such failure to pay is determined by the | 10 | | Director to be wilful,
after a hearing under Sections 402 | 11 | | and 403, there shall be added to the tax
as a penalty an | 12 | | amount equal to the greater of 50% of the
deficiency or 10%
| 13 | | of the amount due and unpaid for each month or part of a | 14 | | month that the
deficiency remains unpaid commencing with | 15 | | the date that the amount becomes
due. Such amount shall be | 16 | | in lieu of any determined under paragraph (a).
| 17 | | (4) Any insurance company or any surplus line producer | 18 | | which
fails to pay the full amount due under this Section or | 19 | | Sections 408.1, 409,
444, 444.1 or 445 of this Code, or Section | 20 | | 12 of the Fire Investigation
Act is liable, in addition to the | 21 | | tax and any penalties, for interest
on such deficiency at the | 22 | | rate of 12% per annum, or at such higher adjusted
rates as are | 23 | | or may be established under subsection (b) of Section 6621
of | 24 | | the Internal Revenue Code, from the date that payment of any | 25 | | such tax
was due, determined without regard to any extensions, | 26 | | to the date of payment
of such amount.
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| 1 | | (5) The Director, through the Attorney
General, may | 2 | | institute an action in the name of the People of the State
of | 3 | | Illinois, in any court of competent jurisdiction, for the | 4 | | recovery of
the amount of such taxes, fees, and penalties due, | 5 | | and prosecute the same to
final judgment, and take such steps | 6 | | as are necessary to collect the same.
| 7 | | (6) In the event that the certificate of authority of a | 8 | | foreign or
alien company is revoked for any cause or the | 9 | | company withdraws from
this State prior to the renewal date of | 10 | | the certificate of authority as
provided in Section 114, the | 11 | | company may recover the amount of any such
tax paid in advance. | 12 | | Except as provided in this subsection, no
revocation or | 13 | | withdrawal excuses payment of or constitutes grounds for
the | 14 | | recovery of any taxes or penalties imposed by this Code.
| 15 | | (7) When an insurance company or domestic affiliated group | 16 | | fails to pay
the full amount of any fee of $200 or more due | 17 | | under
Section 408 of this Code, there shall be added to the | 18 | | amount due as
a penalty the greater of $100 or an amount equal | 19 | | to 10%
of the deficiency for
each month or part of
a month that | 20 | | the deficiency remains unpaid.
| 21 | | (8) The Department shall have a lien for the taxes, fees, | 22 | | charges, fines, penalties, interest, other charges, or any | 23 | | portion thereof, imposed or assessed pursuant to this Code, | 24 | | upon all the real and personal property of any company or | 25 | | person to whom the assessment or final order has been issued or | 26 | | whenever a tax return is filed without payment of the tax or |
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| 1 | | penalty shown therein to be due, including all such property of | 2 | | the company or person acquired after receipt of the assessment, | 3 | | issuance of the order, or filing of the return. The company or | 4 | | person is liable for the filing fee incurred by the Department | 5 | | for filing the lien and the filing fee incurred by the | 6 | | Department to file the release of that lien. The filing fees | 7 | | shall be paid to the Department in addition to payment of the | 8 | | tax, fee, charge, fine, penalty, interest, other charges, or | 9 | | any portion thereof, included in the amount of the lien. | 10 | | However, where the lien arises because of the issuance of a | 11 | | final order of the Director or tax assessment by the | 12 | | Department, the lien shall not attach and the notice referred | 13 | | to in this Section shall not be filed until all administrative | 14 | | proceedings or proceedings in court for review of the final | 15 | | order or assessment have terminated or the time for the taking | 16 | | thereof has expired without such proceedings being instituted. | 17 | | Upon the granting of Department review after a lien has | 18 | | attached, the lien shall remain in full force except to the | 19 | | extent to which the final assessment may be reduced by a | 20 | | revised final assessment following the rehearing or review. The | 21 | | lien created by the issuance of a final assessment shall | 22 | | terminate, unless a notice of lien is filed, within 3 years | 23 | | after the date all proceedings in court for the review of the | 24 | | final assessment have terminated or the time for the taking | 25 | | thereof has expired without such proceedings being instituted, | 26 | | or (in the case of a revised final assessment issued pursuant |
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| 1 | | to a rehearing or review by the Department) within 3 years | 2 | | after the date all proceedings in court for the review of such | 3 | | revised final assessment have terminated or the time for the | 4 | | taking thereof has expired without such proceedings being | 5 | | instituted. Where the lien results from the filing of a tax | 6 | | return without payment of the tax or penalty shown therein to | 7 | | be due, the lien shall terminate, unless a notice of lien is | 8 | | filed, within 3 years after the date when the return is filed | 9 | | with the Department. | 10 | | The time limitation period on the Department's right to | 11 | | file a notice of lien shall not run during any period of time | 12 | | in which the order of any court has the effect of enjoining or | 13 | | restraining the Department from filing such notice of lien. If | 14 | | the Department finds that a company or person is about to | 15 | | depart from the State, to conceal himself or his property, or | 16 | | to do any other act tending to prejudice or to render wholly or | 17 | | partly ineffectual proceedings to collect the amount due and | 18 | | owing to the Department unless such proceedings are brought | 19 | | without delay, or if the Department finds that the collection | 20 | | of the amount due from any company or person will be | 21 | | jeopardized by delay, the Department shall give the company or | 22 | | person notice of such findings and shall make demand for | 23 | | immediate return and payment of the amount, whereupon the | 24 | | amount shall become immediately due and payable. If the company | 25 | | or person, within 5 days after the notice (or within such | 26 | | extension of time as the Department may grant), does not comply |
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| 1 | | with the notice or show to the Department that the findings in | 2 | | the notice are erroneous, the Department may file a notice of | 3 | | jeopardy assessment lien in the office of the recorder of the | 4 | | county in which any property of the company or person may be | 5 | | located and shall notify the company or person of the filing. | 6 | | The jeopardy assessment lien shall have the same scope and | 7 | | effect as the statutory lien provided for in this Section. If | 8 | | the company or person believes that the company or person does | 9 | | not owe some or all of the tax for which the jeopardy | 10 | | assessment lien against the company or person has been filed, | 11 | | or that no jeopardy to the revenue in fact exists, the company | 12 | | or person may protest within 20 days after being notified by | 13 | | the Department of the filing of the jeopardy assessment lien | 14 | | and request a hearing, whereupon the Department shall hold a | 15 | | hearing in conformity with the provisions of this Code and, | 16 | | pursuant thereto, shall notify the company or person of its | 17 | | findings as to whether or not the jeopardy assessment lien will | 18 | | be released. If not, and if the company or person is aggrieved | 19 | | by this decision, the company or person may file an action for | 20 | | judicial review of the final determination of the Department in | 21 | | accordance with the Administrative Review Law. If, pursuant to | 22 | | such hearing (or after an independent determination of the | 23 | | facts by the Department without a hearing), the Department | 24 | | determines that some or all of the amount due covered by the | 25 | | jeopardy assessment lien is not owed by the company or person, | 26 | | or that no jeopardy to the revenue exists, or if on judicial |
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| 1 | | review the final judgment of the court is that the company or | 2 | | person does not owe some or all of the amount due covered by | 3 | | the jeopardy assessment lien against them, or that no jeopardy | 4 | | to the revenue exists, the Department shall release its | 5 | | jeopardy assessment lien to the extent of such finding of | 6 | | nonliability for the amount, or to the extent of such finding | 7 | | of no jeopardy to the revenue. The Department shall also | 8 | | release its jeopardy assessment lien against the company or | 9 | | person whenever the amount due and owing covered by the lien, | 10 | | plus any interest which may be due, are paid and the company or | 11 | | person has paid the Department in cash or by guaranteed | 12 | | remittance an amount representing the filing fee for the lien | 13 | | and the filing fee for the release of that lien. The Department | 14 | | shall file that release of lien with the recorder of the county | 15 | | where that lien was filed. | 16 | | Nothing in this Section shall be construed to give the | 17 | | Department a preference over the rights of any bona fide | 18 | | purchaser, holder of a security interest, mechanics | 19 | | lienholder, mortgagee, or judgment lien creditor arising prior | 20 | | to the filing of a regular notice of lien or a notice of | 21 | | jeopardy assessment lien in the office of the recorder in the | 22 | | county in which the property subject to the lien is located. | 23 | | For purposes of this Section, "bona fide" shall not include any | 24 | | mortgage of real or personal property or any other credit | 25 | | transaction that results in the mortgagee or the holder of the | 26 | | security acting as trustee for unsecured creditors of the |
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| 1 | | company or person mentioned in the notice of lien who executed | 2 | | such chattel or real property mortgage or the document | 3 | | evidencing such credit transaction. The lien shall be inferior | 4 | | to the lien of general taxes, special assessments, and special | 5 | | taxes levied by any political subdivision of this State. In | 6 | | case title to land to be affected by the notice of lien or | 7 | | notice of jeopardy assessment lien is registered under the | 8 | | provisions of the Registered Titles (Torrens) Act, such notice | 9 | | shall be filed in the office of the Registrar of Titles of the | 10 | | county within which the property subject to the lien is | 11 | | situated and shall be entered upon the register of titles as a | 12 | | memorial or charge upon each folium of the register of titles | 13 | | affected by such notice, and the Department shall not have a | 14 | | preference over the rights of any bona fide purchaser, | 15 | | mortgagee, judgment creditor, or other lienholder arising | 16 | | prior to the registration of such notice. The regular lien or | 17 | | jeopardy assessment lien shall not be effective against any | 18 | | purchaser with respect to any item in a retailer's stock in | 19 | | trade purchased from the retailer in the usual course of the | 20 | | retailer's business. | 21 | | (Source: P.A. 93-32, eff. 7-1-03.)
| 22 | | Section 99. Effective date. This Act takes effect upon | 23 | | becoming law.
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