State of Illinois
92^nd General Assembly
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92_HB4106eng

 
HB4106 Engrossed                               LRB9214871JSpc

 1        AN ACT concerning tax anticipation loans.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 1.  Short title. This Act may be cited as the Tax
 5    Refund Anticipation Loan Disclosure Act.

 6        Section 5.  Definitions. The following definitions  apply
 7    in this Act:
 8        "Facilitator"  means  a  person  who  individually  or in
 9    conjunction or cooperation with another person makes a refund
10    anticipation  loan,  processes,  receives,  or  accepts   for
11    delivery  an  application  for  a  refund  anticipation loan,
12    issues  a  check  in  payment  of  refund  anticipation  loan
13    proceeds, or in any other manner acts to allow the making  of
14    a  refund anticipation loan. "Facilitator" does not include a
15    bank, savings and loan association, credit union, or licensee
16    under the Consumer Installment Loan Act operating  under  the
17    laws  of the United States or this State and does not include
18    any person who acts solely as an intermediary  and  does  not
19    deal with the public in the making of the refund anticipation
20    loan.
21        "Borrower"  means a person who receives the proceeds of a
22    refund anticipation loan.
23        "Refund anticipation loan" means a loan  arranged  to  be
24    repaid  directly from the proceeds of a borrower's income tax
25    refunds.
26        "Refund anticipation loan fee" means the  charges,  fees,
27    or  other consideration charged or imposed by the facilitator
28    for the making of  a  refund  anticipation  loan.  A  "refund
29    anticipation  loan  fee"  does  not include charges, fees, or
30    other consideration charged or imposed in the ordinary course
31    of business by a facilitator for services that do not  result
 
HB4106 Engrossed            -2-                LRB9214871JSpc
 1    in  the  making  of  a  loan,  including  fees for tax return
 2    preparation and fees for electronic filing of tax returns.

 3        Section 10.  Disclosure  requirements.   At  the  time  a
 4    borrower   applies   for   a   refund  anticipation  loan,  a
 5    facilitator shall disclose to the borrower on a document that
 6    is separate from the loan application:
 7             (1)  the refund anticipation loan fee schedule;
 8             (2)  the   estimated   fee   for    preparing    and
 9        electronically filing a tax return;
10             (3)  the  estimated date that the loan proceeds will
11        be paid to the borrower if the loan is approved;
12             (4)  that the borrower is responsible for  repayment
13        of  the loan and related fees in the event the tax refund
14        is not paid or not paid in full; and
15             (5)  the availability of electronic filing  for  the
16        income  tax  return  of the borrower and the average time
17        announced by the federal Internal Revenue Service  within
18        which  the borrower can expect to receive a refund if the
19        borrower's  return  is  filed  electronically   and   the
20        borrower does not obtain a refund anticipation loan.

21        Section 15.  Penalty. Any person who violates this Act is
22    guilty  of  a  petty offense and shall be fined $500 for each
23    offense. In addition, a facilitator  who  violates  this  Act
24    shall  be liable to any aggrieved borrower in an amount equal
25    to  3  times  the  refund  anticipation  loan  fee,  plus   a
26    reasonable  attorney's  fee, in a civil action brought in the
27    circuit court by the aggrieved borrower or  by  the  Attorney
28    General on behalf of the aggrieved borrower.

29        Section  99.  Effective  date.  This  Act takes effect on
30    January 1, 2003.

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