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| [ Introduced ] | [ Enrolled ] | [ Senate Amendment 001 ] |
92_SB2210eng SB2210 Engrossed LRB9212102SMdv 1 AN ACT regarding taxes. 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 changing 6 Section 2505-275 as follows: 7 (20 ILCS 2505/2505-275) (was 20 ILCS 2505/39e) 8 Sec. 2505-275. Tax overpayments. In the case of 9 overpayment of any tax liability arising from an Act 10 administered by the Department, the Department may credit the 11 amount of the overpayment and any interest thereon against 12 any final tax liability arising under that or any other Act 13 administered by the Department. The Department may enter into 14 agreements with the Secretary of the Treasury of the United 15 States (or his or her delegate) to offset all or part of an 16 overpayment of such a tax liability against any liability 17 arising from a tax imposed under Title 26 of the United 18 States Code. The Department may collect a fee from the 19 Secretary of the Treasury of the United States (or his or her 20 delegate) to cover the full cost of offsets taken, to the 21 extent allowed by federal law, or, if not allowed by federal 22 law, from the taxpayer by offset of the overpayment. 23 (Source: P.A. 91-239, eff. 1-1-00; 92-492, eff. 1-1-02.) 24 Section 10. The Illinois Income Tax Act is amended by 25 changing Sections 601, 911.2, 1102, 1103, and 1105 and by 26 adding Section 911.3 as follows: 27 (35 ILCS 5/601) (from Ch. 120, par. 6-601) 28 Sec. 601. Payment on Due Date of Return. 29 (a) In general. Every taxpayer required to file a return SB2210 Engrossed -2- LRB9212102SMdv 1 under this Act shall, without assessment, notice or demand, 2 pay any tax due thereon to the Department, at the place fixed 3 for filing, on or before the date fixed for filing such 4 return (determined without regard to any extension of time 5 for filing the return) pursuant to regulations prescribed by 6 the Department. If, however, the due date for payment of a 7 taxpayer's federal income tax liability for a tax year (as 8 provided in the Internal Revenue Code or by Treasury 9 regulation, or as extended by the Internal Revenue Service) 10 is later than the date fixed for filing the taxpayer's 11 Illinois income tax return for that tax year, the Department 12 may, by rule, prescribe a due date for payment that is not 13 later than the due date for payment of the taxpayer's federal 14 income tax liability. For purposes of the Illinois 15 Administrative Procedure Act, the adoption of rules to 16 prescribe a later due date for payment shall be deemed an 17 emergency and necessary for the public interest, safety, and 18 welfare. 19 (b) Amount payable. In making payment as provided in 20 this section there shall remain payable only the balance of 21 such tax remaining due after giving effect to the following: 22 (1) Withheld tax. Any amount withheld during any 23 calendar year pursuant to Article 7 from compensation paid to 24 a taxpayer shall be deemed to have been paid on account of 25 any tax imposed by subsections 201(a) and (b) of this Act on 26 such taxpayer for his taxable year beginning in such calendar 27 year. If more than one taxable year begins in a calendar 28 year, such amount shall be deemed to have been paid on 29 account of such tax for the last taxable year so beginning. 30 (2) Estimated and tentative tax payments. Any amount of 31 estimated tax paid by a taxpayer pursuant to Article 8 for a 32 taxable year shall be deemed to have been paid on account of 33 the tax imposed by this Act for such taxable year. 34 (3) Foreign tax. The aggregate amount of tax which is SB2210 Engrossed -3- LRB9212102SMdv 1 imposed upon or measured by income and which is paid by a 2 resident for a taxable year to another state or states on 3 income which is also subject to the tax imposed by 4 subsections 201(a) and (b) of this Act shall be credited 5 against the tax imposed by subsections 201(a) and (b) 6 otherwise due under this Act for such taxable year. The 7 aggregate credit provided under this paragraph shall not 8 exceed that amount which bears the same ratio to the tax 9 imposed by subsections 201(a) and (b) otherwise due under 10 this Act as the amount of the taxpayer's base income subject 11 to tax both by such other state or states and by this State 12 bears to his total base income subject to tax by this State 13 for the taxable year. For purposes of this subsection, no 14 compensation received by a resident which qualifies as 15 compensation paid in this State as determined under Section 16 304(a)(2)(B) shall be considered income subject to tax by 17 another state or states. The credit provided by this 18 paragraph shall not be allowed if any creditable tax was 19 deducted in determining base income for the taxable year. Any 20 person claiming such credit shall attach a statement in 21 support thereof and shall notify the Director of any refund 22 or reductions in the amount of tax claimed as a credit 23 hereunder all in such manner and at such time as the 24 Department shall by regulations prescribe. 25 (4) Accumulation and capital gain distributions. If the 26 net income of a taxpayer includes amounts included in his 27 base income by reason of Section 668 or 669 of the Internal 28 Revenue Code (relating to accumulation and capital gain 29 distributions by a trust, respectively), the tax imposed on 30 such taxpayer by this Act shall be credited with his pro rata 31 portion of the taxes imposed by this Act on such trust for 32 preceding taxable years which would not have been payable for 33 such preceding years if the trust had in fact made 34 distributions to its beneficiaries at the times and in the SB2210 Engrossed -4- LRB9212102SMdv 1 amounts specified in Sections 666 and 669 of the Internal 2 Revenue Code. The credit provided by this paragraph shall not 3 reduce the tax otherwise due from the taxpayer to an amount 4 less than that which would be due if the amounts included by 5 reason of Sections 668 and 669 of the Internal Revenue Code 6 were excluded from his base income. 7 (c) Cross reference. For application against tax due of 8 overpayments of tax for a prior year, see Section 909. 9 (Source: P.A. 85-731.) 10 (35 ILCS 5/911.2) 11 Sec. 911.2. Refunds withheld; tax claims of other 12 states. 13 (a) Definitions. In this Section the following terms 14 have the meanings indicated. 15 "Claimant state" means any state or the District of 16 Columbia that requests the withholding of a refund pursuant 17 to this Section and that extends a like comity for the 18 collection of taxes owed to this State. 19 "Income tax" means any amount of income tax imposed on 20 taxpayers under the laws of the State of Illinois or the 21 claimant state, including additions to tax for penalties and 22 interest. 23 "Refund" means a refund of overpaid income taxes imposed 24 by the State of Illinois or the claimant state. 25 "Tax officer" means a unit or official of the claimant 26 state, or the duly authorized agent of that unit or official, 27 charged with the imposition, assessment, or collection of 28 state income taxes. 29 "Taxpayer" means any individual person identified by a 30 claimant state under this Section as owing taxes to that 31 claimant state, and in the case of a refund arising from the 32 filing of a joint return, the taxpayer's spouse. 33 (b) In general. Except as provided in subsection (c) of SB2210 Engrossed -5- LRB9212102SMdv 1 this Section, a tax officer may: 2 (1) certify to the Director the existence of a 3 taxpayer's delinquent income tax liability; and 4 (2) request the Director to withhold any refund to 5 which the taxpayer is entitled. 6 (c) Comity. A tax officer may not certify or request 7 the Director to withhold a refund unless the laws of the 8 claimant state: 9 (1) allow the Director to certify an income tax 10 liability; 11 (2) allow the Director to request the tax officer 12 to withhold the taxpayer's tax refund; and 13 (3) provide for the payment of the refund to the 14 State of Illinois. 15 (d) Certification. A certification by a tax officer to 16 the Director shall include: 17 (1) the full name and address of the taxpayer and 18 any other names known to be used by the taxpayer; 19 (2) the social security number or federal tax 20 identification number of the taxpayer; 21 (3) the amount of the income tax liability; and 22 (4) a statement that all administrative and 23 judicial remedies and appeals have been exhausted or have 24 lapsed and that the assessment of tax, interest, and 25 penalty has become final. 26 (e) Notification. As to any taxpayer due a refund, the 27 Director shall: 28 (1) notify the taxpayer that a claimant state has 29 provided certification of the existence of an income tax 30 liability; 31 (2) inform the taxpayer of the tax liability 32 certified, including a detailed statement for each 33 taxable year showing tax, interest, and penalty; 34 (3) inform the taxpayer that failure to file a SB2210 Engrossed -6- LRB9212102SMdv 1 protest in accordance with subsection (f) of this Section 2 shall constitute a waiver of any demand against this 3 State for the amount certified; 4 (3.5) inform the taxpayer that the refund has been 5 withheld and that the tax liability has been paid to the 6 claimant state as provided in subsection (i) of this 7 Sectionand will result in payment to the claimant state8as provided in subsection (i) of this Section; 9 (4) provide the taxpayer with notice of an 10 opportunity to request a hearing to challenge the 11 certification; and 12 (5) inform the taxpayer that the hearing may be 13 requested (i) pursuant to Section 910 of this Act, or 14 (ii) with the tax officer, in accordance with the laws of 15 the claimant state. 16 (f) Protest of withholding. A taxpayer may protest the 17 withholding of a refund pursuant to Section 910 of this Act 18 (except that the protest shall be filed within 30 days after 19 the date of the Director's notice of certification pursuant 20 to subsection (e) of this Section).If a taxpayer files a21timely protest, the Director shall:22(1) suspend the proposed withholding and impound23the claimed amount of the refund;24(2) pay to the taxpayer the unclaimed amount of the25refund, if any;26(3) send a copy of the protest to the claimant27state for determination of the protest on its merits in28accordance with the laws of that state; and29(4) pay over to the taxpayer the impounded amount30if the claimant state shall fail, within 45 days after31the date of the protest, to re-certify to the Director32(i) that the claimant state has reviewed the issues33raised by taxpayer, (ii) that all administrative and34judicial remedies provided under the laws of that stateSB2210 Engrossed -7- LRB9212102SMdv 1have been exhausted, and (iii) the amount of the income2tax liability finally determined to be due.3 (g) Certification as prima facie evidence. If the 4 taxpayer requests a hearing pursuant to Section 910 of this 5 Act, the certification of the tax officer shall be prima 6 facie evidence of the correctness of the taxpayer's 7 delinquent income tax liability to the certifying state. 8 (h) Rights of spouses to refunds from joint returns. If 9 a certification is based upon the tax debt of only one 10 taxpayer and if the refund is based upon a joint personal 11 income tax return, the nondebtor spouse shall have the right 12 to: 13 (1) notification, as provided in subsection (e) of 14 this Section; 15 (2) protest, as to the withholding of such spouse's 16 share of the refund, as provided in subsection (f) of 17 this Section; and 18 (3) payment of his or her share of the refund, 19 provided the amount of the overpayment refunded to the 20 spouse shall not exceed the amount of the joint 21 overpayment. 22 (i) Withholding and payment of refund.Subject to the23taxpayer's rights of notice and protest,Upon receipt of a 24 request for withholding in accordance with subsection (b) of 25 this Section, the Director shall: 26 (1) withhold any refund that is certified by the 27 tax officer; 28 (2) pay to the claimant state the entire refund or 29 the amount certified, whichever is less; 30 (3) pay any refund in excess of the amount 31 certified to the taxpayer; and 32 (4) if a refund is less than the amount certified, 33 withhold amounts from subsequent refunds due the 34 taxpayer, if the laws of the claimant state provide that SB2210 Engrossed -8- LRB9212102SMdv 1 the claimant state shall withhold subsequent refunds of 2 taxpayers certified to that state by the Director. 3 (j) Determination that withholding cannot be made. 4 After receiving a certification from a tax officer, the 5 Director shall notify the claimant state if the Director 6 determines that a withholding cannot be made. 7 (k) Director's authority. The Director shall have the 8 authority to enter into agreements with the tax officers of 9 claimant state relating to: 10 (1) procedures and methods to be employed by a 11 claimant state with respect to the operation of this 12 Section; 13 (2) safeguards against the disclosure or 14 inappropriate use of any information obtained or 15 maintained pursuant to this Section that identifies, 16 directly or indirectly, a particular taxpayer; 17 (3) a minimum tax debt, amounts below which, in 18 light of administrative expenses and efficiency, shall, 19 in the Director's discretion, not be subject to the 20 withholding procedures set forth in this Section. 21 (l) Remedy not exclusive. The collection procedures 22 prescribed by this Section are in addition to, and not in 23 substitution for, any other remedy available by law. 24 (Source: P.A. 92-492, eff. 1-1-02.) 25 (35 ILCS 5/911.3 new) 26 Sec. 911.3. Refunds withheld; order of honoring requests. 27 The Department shall honor refund withholding requests in the 28 following order: 29 (1) a refund withholding request to collect an 30 unpaid State tax; 31 (2) a refund withholding request to collect 32 certified past due child support amounts under Section 33 2505-650 of the Department of Revenue Law of the Civil SB2210 Engrossed -9- LRB9212102SMdv 1 Administrative Code of Illinois; 2 (3) a refund withholding request to collect any 3 debt owed to the State; 4 (4) a refund withholding request made by the 5 Secretary of the Treasury of the United States, or his or 6 her delegate, to collect any tax liability arising from 7 Title 26 of the United States Code; and 8 (5) a refund withholding request pursuant to 9 Section 911.2 of this Act. 10 (35 ILCS 5/1102) (from Ch. 120, par. 11-1102) 11 Sec. 1102. Jeopardy Assessments. 12 (a) Jeopardy assessment and lien. 13 (1) Assessment. If the Department finds that a 14 taxpayer is about to depart from the State, or to conceal 15 himself or his property, or to do any other act tending 16 to prejudice or to render wholly or partly ineffectual 17 proceedings to collect any amount of tax or penalties 18 imposed under this Act unless court proceedings are 19 brought without delay, or if the Department finds that 20 the collection of such amount will be jeopardized by 21 delay, the Department shall give the taxpayer notice of 22 such findings and shall make demand for immediate return 23 and payment of such amount, whereupon such amount shall 24 be deemed assessed and shall become immediately due and 25 payable. 26 (2) Filing of lien. If the taxpayer, within 5 days 27 after such notice (or within such extension of time as 28 the Department may grant), does not comply with such 29 notice or show to the Department that the findings in 30 such notice are erroneous, the Department may file a 31 notice of jeopardy assessment lien in the office of the 32 recorder of the county in which any property of the 33 taxpayer may be located and shall notify the taxpayer of SB2210 Engrossed -10- LRB9212102SMdv 1 such filing. Such jeopardy assessment lien shall have the 2 same scope and effect as a statutory lien under this Act. 3 The taxpayer is liable for the filing fee incurred by the 4 Department for filing the lien and the filing fee 5 incurred by the Department to file the release of that 6 lien. The filing fees shall be paid to the Department in 7 addition to payment of the tax, penalty, and interest 8 included in the amount of the lien. 9 (b) Termination of taxable year. In the case of a tax 10 for a current taxable year, the Director shall declare the 11 taxable period of the taxpayer immediately terminated and his 12 notice and demand for a return and immediate payment of the 13 tax shall relate to the period declared terminated, including 14 therein income accrued and deductions incurred up to the date 15 of termination if not otherwise properly includible or 16 deductible in respect of such taxable year. 17 (c) Protest. If the taxpayer believes that he does not 18 owe some or all of the amount for which the jeopardy 19 assessment lien against him has been filed, or that no 20 jeopardy to the revenue in fact exists, he may protest within 21 20 days after being notified by the Department of the filing 22 of such jeopardy assessment lien and request a hearing, 23 whereupon the Department shall hold a hearing in conformity 24 with the provisions of section 908 and, pursuant thereto, 25 shall notify the taxpayer of its decision as to whether or 26 not such jeopardy assessment lien will be released. 27 (Source: P.A. 83-358.) 28 (35 ILCS 5/1103) (from Ch. 120, par. 11-1103) 29 Sec. 1103. Filing and Priority of Liens. (a) Filing with 30 Recorder. Nothing in this Article shall be construed to give 31 the Department a preference over the rights of any bona fide 32 purchaser, holder of a security interest, mechanics lienor, 33 mortgagee, or judgment lien creditor arising prior to the SB2210 Engrossed -11- LRB9212102SMdv 1 filing of a regular notice of lien or a notice of jeopardy 2 assessment lien in the office of the recorder in the county 3 in which the property subject to the lien is located. For 4 purposes of this section, the term "bona fide," shall not 5 include any mortgage of real or personal property or any 6 other credit transaction that results in the mortgagee or the 7 holder of the security acting as trustee for unsecured 8 creditors of the taxpayer mentioned in the notice of lien who 9 executed such chattel or real property mortgage or the 10 document evidencing such credit transaction. Such lien shall 11 be inferior to the lien of general taxes, special assessments 12 and special taxes heretofore or hereafter levied by any 13 political subdivision of this State. 14 (b) Filing with Registrar. In case title to land to be 15 affected by the notice of lien or notice of jeopardy 16 assessment lien is registered under the provisions of "An Act 17 concerning land titles," approved May 1, 1897, as amended, 18 such notice shall be filed in the office of the Registrar of 19 Titles of the county within which the property subject to the 20 lien is situated and shall be entered upon the register of 21 titles as a memorial of charge upon each folium of the 22 register of titles affected by such notice, and the 23 Department shall not have a preference over the rights of any 24 bona fide purchaser, mortgagee, judgment creditor or other 25 lien holder arising prior to the registration of such notice. 26 (c) Index. The recorder of each county shall procure a 27 file labeled "State Tax Lien Notices" and an index book 28 labeled "State Tax Lien Index." When notice of any lien or 29 jeopardy assessment lien is presented to him for filing, he 30 shall file it in numerical order in the file and shall enter 31 it alphabetically in the index. The entry shall show the name 32 and last known address of the person named in the notice, the 33 serial number of the notice, the date and hour of filing, 34 whether it is a regular lien or a jeopardy assessment lien, SB2210 Engrossed -12- LRB9212102SMdv 1 and the amount of tax and penalty due and unpaid, plus the 2 amount of interest due at the time when the notice of lien or 3 jeopardy assessment is filed. 4 (d) No recorder or registrar of titles of any county 5 shall require that the Department pay any costs or fees in 6 connection with recordation of any notice or other document 7 filed by the Department under this Act at the time such 8 notice or other document is presented for recordation. The 9 recorder or registrar of each county, in order to receive 10 payment for fees or costs incurred by the Department, shall 11 present the Department with monthly statements indicating the 12 amount of fees and costs incurred by the Department and for 13 which no payment has been received. This amendatory Act of 14 1987 applies to all liens heretofore or hereafter filed. 15 (e) The taxpayer is liable for the filing fee incurred 16 by the Department for filing the lien and the filing fee 17 incurred by the Department to file the release of that lien. 18 The filing fees shall be paid to the Department in addition 19 to payment of the tax, penalty, and interest included in the 20 amount of the lien. 21 (Source: P.A. 86-905.) 22 (35 ILCS 5/1105) (from Ch. 120, par. 11-1105) 23 Sec. 1105. Release of Liens. 24 (a) In general. Upon payment by the taxpayer to the 25 Department in cash or by guaranteed remittance of an amount 26 representing the filing fees and charges for the lien and the 27 filing fees and charges for the release of that lien, the 28 Department shall release all or any portion of the property 29 subject to any lien provided for in this Act and file that 30 complete or partial release of lien with the recorder of the 31 county where that lien was filed if it determines that the 32 release will not endanger or jeopardize the collection of the 33 amount secured thereby. SB2210 Engrossed -13- LRB9212102SMdv 1 (b) Judicial determination. If on judicial review the 2 final judgment of the court is that the taxpayer does not owe 3 some or all of the amount secured by the lien against him, or 4 that no jeopardy to the revenue exists, the Department shall 5 release its lien to the extent of such finding of 6 nonliability, or to the extent of such finding of no jeopardy 7 to the revenue. The taxpayer shall, however, be liable for 8 the filing fee paid by the Department to file the lien and 9 the filing fee required to file a release of the lien. The 10 filing fees shall be paid to the Department. 11 (c) Payment. The Department shall also release its 12 jeopardy assessment lien against the taxpayer whenever the 13 tax and penalty covered by such lien, plus any interest which 14 may be due and an amount representing the filing fee to file 15 the lien and the filing fee required to file a release of 16 that lien, are paid by the taxpayer to the Department in cash 17 or by guaranteed remittance. 18 (d) Certificate of release. The Department shall issue a 19 certificate of complete or partial release of the lien upon 20 payment by the taxpayer to the Department in cash or by 21 guaranteed remittance of an amount representing the filing 22 fee paid by the Department to file the lien and the filing 23 fee required to file the release of that lien: 24 (1) To the extent that the fair market value of any 25 property subject to the lien exceeds the amount of the lien 26 plus the amount of all prior liens upon such property; 27 (2) To the extent that such lien shall become 28 unenforceable; 29 (3) To the extent that the amount of such lien is paid 30 by the person whose property is subject to such lien, 31 together with any interest and penalty which may become due 32 under this Act between the date when the notice of lien is 33 filed and the date when the amount of such lien is paid; 34 (4) To the extent that there is furnished to the SB2210 Engrossed -14- LRB9212102SMdv 1 Department on a form to be approved and with a surety or 2 sureties satisfactory to the Department a bond that is 3 conditioned upon the payment of the amount of such lien, 4 together with any interest which may become due under this 5 Act after the notice of lien is filed, but before the amount 6 thereof is fully paid; 7 (5) To the extent and under the circumstances specified 8 in this section. A certificate of complete or partial release 9 of any lien shall be held conclusive that the lien upon the 10 property covered by the certificate is extinguished to the 11 extent indicated by such certificate. 12 Such release of lien shall be issued to the person, or 13 his agent, against whom the lien was obtained and shall 14 contain in legible letters a statement as follows: 15 FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHALL 16 BE FILED WITH THE RECORDER OR THE REGISTRAR 17 OF TITLES, IN WHOSE OFFICE, THE LIEN WAS FILED. 18 (e) Filing. When a certificate of complete or partial 19 release of lien issued by the Department is presented for 20 filing in the office of the recorder or Registrar of Titles 21 where a notice of lien or notice of jeopardy assessment lien 22 was filed: 23 (1) The recorder, in the case of nonregistered property, 24 shall permanently attach the certificate of release to the 25 notice of lien or notice of jeopardy assessment lien and 26 shall enter the certificate of release and the date in the 27 "State Tax Lien Index" on the line where the notice of lien 28 or notice of jeopardy assessment lien is entered; and 29 (2) In the case of registered property, the Registrar of 30 Titles shall file and enter upon each folium of the register 31 of titles affected thereby a memorial of the certificate of 32 release which memorial when so entered shall act as a release 33 pro tanto of any memorial of such notice of lien or notice of 34 jeopardy assessment lien previously filed and registered. SB2210 Engrossed -15- LRB9212102SMdv 1 (Source: P.A. 85-731.) 2 Section 15. The Retailers' Occupation Tax Act is amended 3 by changing Sections 5a, 5b, and 5c as follows: 4 (35 ILCS 120/5a) (from Ch. 120, par. 444a) 5 Sec. 5a. The Department shall have a lien for the tax 6 herein imposed or any portion thereof, or for any penalty 7 provided for in this Act, or for any amount of interest which 8 may be due as provided for in Section 5 of this Act, upon all 9 the real and personal property of any person to whom a final 10 assessment or revised final assessment has been issued as 11 provided in this Act, or whenever a return is filed without 12 payment of the tax or penalty shown therein to be due, 13 including all such property of such persons acquired after 14 receipt of such assessment or filing of such return. The 15 taxpayer is liable for the filing fee incurred by the 16 Department for filing the lien and the filing fee incurred by 17 the Department to file the release of that lien. The filing 18 fees shall be paid to the Department in addition to payment 19 of the tax, penalty, and interest included in the amount of 20 the lien. 21 However, where the lien arises because of the issuance of 22 a final assessment or revised final assessment by the 23 Department, such lien shall not attach and the notice 24 hereinafter referred to in this Section shall not be filed 25 until all proceedings in court for review of such final 26 assessment or revised final assessment have terminated or the 27 time for the taking thereof has expired without such 28 proceedings being instituted. 29 Upon the granting of a rehearing or departmental review 30 pursuant to Section 4 or Section 5 of this Act after a lien 31 has attached, such lien shall remain in full force except to 32 the extent to which the final assessment may be reduced by a SB2210 Engrossed -16- LRB9212102SMdv 1 revised final assessment following such rehearing or review. 2 The lien created by the issuance of a final assessment 3 shall terminate unless a notice of lien is filed, as provided 4 in Section 5b hereof, within 3 years from the date all 5 proceedings in court for the review of such final assessment 6 have terminated or the time for the taking thereof has 7 expired without such proceedings being instituted, or (in the 8 case of a revised final assessment issued pursuant to a 9 rehearing or departmental review) within 3 years from the 10 date all proceedings in court for the review of such revised 11 final assessment have terminated or the time for the taking 12 thereof has expired without such proceedings being 13 instituted; and where the lien results from the filing of a 14 return without payment of the tax or penalty shown therein to 15 be due, the lien shall terminate unless a notice of lien is 16 filed, as provided in Section 5b hereof, within 3 years from 17 the date when such return is filed with the Department: 18 Provided that the time limitation period on the Department's 19 right to file a notice of lien shall not run during any 20 period of time in which the order of any court has the effect 21 of enjoining or restraining the Department from filing such 22 notice of lien. 23 If the Department finds that a taxpayer is about to 24 depart from the State, or to conceal himself or his property, 25 or to do any other act tending to prejudice or to render 26 wholly or partly ineffectual proceedings to collect such tax 27 unless such proceedings are brought without delay, or if the 28 Department finds that the collection of the amount due from 29 any taxpayer will be jeopardized by delay, the Department 30 shall give the taxpayer notice of such findings and shall 31 make demand for immediate return and payment of such tax, 32 whereupon such tax shall become immediately due and payable. 33 If the taxpayer, within 5 days after such notice (or within 34 such extension of time as the Department may grant), does not SB2210 Engrossed -17- LRB9212102SMdv 1 comply with such notice or show to the Department that the 2 findings in such notice are erroneous, the Department may 3 file a notice of jeopardy assessment lien in the office of 4 the recorder of the county in which any property of the 5 taxpayer may be located and shall notify the taxpayer of such 6 filing. Such jeopardy assessment lien shall have the same 7 scope and effect as the statutory lien hereinbefore provided 8 for in this Section. 9 If the taxpayer believes that he does not owe some or all 10 of the tax for which the jeopardy assessment lien against him 11 has been filed, or that no jeopardy to the revenue in fact 12 exists, he may protest within 20 days after being notified by 13 the Department of the filing of such jeopardy assessment lien 14 and request a hearing, whereupon the Department shall hold a 15 hearing in conformity with the provisions of this Act and, 16 pursuant thereto, shall notify the taxpayer of its findings 17 as to whether or not such jeopardy assessment lien will be 18 released. If not, and if the taxpayer is aggrieved by this 19 decision, he may file an action for judicial review of such 20 final determination of the Department in accordance with 21 Section 12 of this Act and the Administrative Review Law. 22 If, pursuant to such hearing (or after an independent 23 determination of the facts by the Department without a 24 hearing), the Department determines that some or all of the 25 tax covered by the jeopardy assessment lien is not owed by 26 the taxpayer, or that no jeopardy to the revenue exists, or 27 if on judicial review the final judgment of the court is that 28 the taxpayer does not owe some or all of the tax covered by 29 the jeopardy assessment lien against him, or that no jeopardy 30 to the revenue exists, the Department shall release its 31 jeopardy assessment lien to the extent of such finding of 32 nonliability for the tax, or to the extent of such finding of 33 no jeopardy to the revenue. 34 The Department shall also release its jeopardy assessment SB2210 Engrossed -18- LRB9212102SMdv 1 lien against the taxpayer whenever the tax and penalty 2 covered by such lien, plus any interest which may be due, are 3 paid and the taxpayer has paid the Department in cash or by 4 guaranteed remittance an amount representing the filing fee 5 for the lien and the filing fee for the release of that lien. 6 The Department shall file that release of lien with the 7 recorder of the county where that lien was filed. 8 Nothing in this Section shall be construed to give the 9 Department a preference over the rights of any bona fide 10 purchaser, holder of a security interest, mechanics 11 lienholder, mortgagee, or judgment lien creditor arising 12 prior to the filing of a regular notice of lien or a notice 13 of jeopardy assessment lien in the office of the recorder in 14 the county in which the property subject to the lien is 15 located: Provided, however, that the word "bona fide", as 16 used in this Section shall not include any mortgage of real 17 or personal property or any other credit transaction that 18 results in the mortgagee or the holder of the security acting 19 as trustee for unsecured creditors of the taxpayer mentioned 20 in the notice of lien who executed such chattel or real 21 property mortgage or the document evidencing such credit 22 transaction. Such lien shall be inferior to the lien of 23 general taxes, special assessments and special taxes 24 heretofore or hereafter levied by any political subdivision 25 of this State. 26 In case title to land to be affected by the notice of 27 lien or notice of jeopardy assessment lien is registered 28 under the provisions of "An Act concerning land titles", 29 approved May 1, 1897, as amended, such notice shall be filed 30 in the office of the Registrar of Titles of the county within 31 which the property subject to the lien is situated and shall 32 be entered upon the register of titles as a memorial or 33 charge upon each folium of the register of titles affected by 34 such notice, and the Department shall not have a preference SB2210 Engrossed -19- LRB9212102SMdv 1 over the rights of any bona fide purchaser, mortgagee, 2 judgment creditor or other lien holder arising prior to the 3 registration of such notice: Provided, however, that the word 4 "bona fide" shall not include any mortgage of real or 5 personal property or any other credit transaction that 6 results in the mortgagee or the holder of the security acting 7 as trustee for unsecured creditors of the taxpayer mentioned 8 in the notice of lien who executed such chattel or real 9 property mortgage or the document evidencing such credit 10 transaction. 11 Such regular lien or jeopardy assessment lien shall not 12 be effective against any purchaser with respect to any item 13 in a retailer's stock in trade purchased from the retailer in 14 the usual course of such retailer's business. 15 (Source: P.A. 86-905.) 16 (35 ILCS 120/5b) (from Ch. 120, par. 444b) 17 Sec. 5b. The recorder of each county shall procure a 18 file labeled "State Tax Lien Notices" and an index book 19 labeled "State Tax Lien Index". When notice of any lien or 20 jeopardy assessment lien is presented to him for filing, he 21 shall file it in numerical order in the file and shall enter 22 it alphabetically in the index. The entry shall show the name 23 and last known business address of the person named in the 24 notice, the serial number of the notice, the date and hour of 25 filing, whether it is a regular lien or a jeopardy assessment 26 lien, and the amount of tax and penalty due and unpaid, plus 27 the amount of interest due under Section 5 of this Act at the 28 time when the notice of lien or jeopardy assessment lien is 29 filed. 30 No recorder or registrar of titles of any county shall 31 require that the Department pay any costs or fees in 32 connection with recordation of any notice or other document 33 filed by the Department under this Act at the time such SB2210 Engrossed -20- LRB9212102SMdv 1 notice or other document is presented for recordation. The 2 recorder or registrar of each county, in order to receive 3 payment for fees or costs incurred by the Department, shall 4 present the Department with monthly statements indicating the 5 amount of fees and costs incurred by the Department and for 6 which no payment has been received. 7 A notice of lien may be filed after the issuance of a 8 revised final assessment pursuant to a rehearing or 9 departmental review under Section 4 or Section 5 of this Act. 10 When the lien obtained pursuant to this Act has been 11 satisfied and the taxpayer has paid the Department in cash or 12 by guaranteed remittance an amount representing the filing 13 fee for the lien and the filing fee for the release of that 14 lien, the Department shall issue a release of lien and file 15 that release of lien with the recorder of the county where 16 that lien was filed. Theto the person, or his agent, against17whom the lien was obtained and suchrelease of lien shall 18 contain in legible letters a statement as follows: 19 FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHALL 20 BE FILED WITH THE RECORDER OR THE REGISTRAR 21 OF TITLES, IN WHOSE OFFICE, THE LIEN WAS FILED. 22 When a certificate of complete or partial release of lien 23 issued by the Department is presented for filing in the 24 office of the recorder or Registrar of Titles where a notice 25 of lien or notice of jeopardy assessment lien was filed, the 26 recorder, in the case of nonregistered property, shall 27 permanently attach the certificate of release to the notice 28 of lien or notice of jeopardy assessment lien and shall enter 29 the certificate of release and the date in the "State Tax 30 Lien Index" on the line where the notice of lien or notice of 31 jeopardy assessment lien is entered. 32 In the case of registered property, the Registrar of 33 Titles shall file and enter upon each folium of the register 34 of titles affected thereby a memorial of the certificate of SB2210 Engrossed -21- LRB9212102SMdv 1 release which memorial when so entered shall act as a release 2 pro tanto of any memorial of such notice of lien or notice of 3 jeopardy assessment lien previously filed and registered. 4 (Source: P.A. 84-221.) 5 (35 ILCS 120/5c) (from Ch. 120, par. 444c) 6 Sec. 5c. Upon payment by the taxpayer to the Department 7 in cash or by guaranteed remittance of an amount representing 8 the filing fee for the lien and the filing fee for the 9 release of that lien, the Department shall issue a 10 certificate of complete or partial release of the lien and 11 file that complete or partial release of lien with the 12 recorder of the county where the lien was filed: 13 (a) To the extent that the fair market value of any 14 property subject to the lien exceeds the amount of the lien 15 plus the amount of all prior liens upon such property; 16 (b) To the extent that such lien shall become 17 unenforceable; 18 (c) To the extent that the amount of such lien is paid 19 by the retailer whose property is subject to such lien, 20 together with any interest which may become due under Section 21 5 of this Act between the date when the notice of lien is 22 filed and the date when the amount of such lien is paid; 23 (d) To the extent that there is furnished to the 24 Department on a form to be approved and with a surety or 25 sureties satisfactory to the Department a bond that is 26 conditioned upon the payment of the amount of such lien, 27 together with any interest which may become due under Section 28 5 of this Act after the notice of lien is filed, but before 29 the amount thereof is fully paid; 30 (e) To the extent and under the circumstances specified 31 in Section 5a of this Act in the case of jeopardy assessment 32 liens; 33 (f) To the extent to which an assessment is reduced SB2210 Engrossed -22- LRB9212102SMdv 1 pursuant to a rehearing or departmental review under Section 2 4 or Section 5 of this Act. 3 A certificate of complete or partial release of any lien 4 shall be held conclusive that the lien upon the property 5 covered by the certificate is extinguished to the extent 6 indicated by such certificate. 7 (Source: Laws 1965, p. 531.) 8 Section 99. Effective date. This Act takes effect upon 9 becoming law, except that the changes to Sections 1102, 1103, 10 and 1105 of the Illinois Income Tax Act and Sections 5a, 5b, 11 and 5c of the Retailer's Occupation Tax Act take effect on 12 January 1, 2003.