TAX INSTITUTE
Newsletter

KEITH STAATS

Executive Director
Tax Institute

 
 
(217) 522-5512 ext. 231

February 23, 2018

State and Local Tax this week

Illinois General Assembly 
The Senate returned to Springfield on February 20 and was in session through the 23rd .  The House was was not in session this week. 

The House and Senate are scheduled to be in session next week Tuesday through Thursday. 

The Senate Revenue committee held a hearing  on Tuesday February 14. The committee considered one Illinois Chamber of Commerce Tax Institute initiative, SB 2604.  The bill passed out of committee unanimously.  This legislation amends the Uniform Penalty and Interest to provide for an automatic abatement of the underpayment penalty if, upon audit, a taxpayer is determined to have paid 95% of the required tax.  The legislation also reduces the underpayment penalty to 15% in all cases.  Currently, the maximum underpayment penalty is 20%.

The Senate Revenue committee has scheduled a hearing on February 28.  The linked bills have been posted for committee consideration next week.  At this time, it is unclear as to which of these bills will actually be considered by the committee.

The House Revenue committee has scheduled two hearings next week -  February 21 and March 1. 

The February 27 hearing is a "subject matter" hearing on crypto currencies and blockchain.  At this time, no substantive legislation has been scheduled for consideration at this hearing.

The March 1 hearing of the House Revenue committee is scheduled to consider substantive legislation.  The linked  bills have been posted for committee consideration next week.

Included among the bills posted for March 1 is  HB 4293, Welch, which a mends the Illinois Income Tax Act. to Impose a privilege tax on partnerships and S corporations engaged in the business of conducting investment management services. Provides that the tax shall be imposed at the rate of 20% of the fees calculated by reference to the performance of the investment portfolio funds and not from the investment itself.  The Illinois Chamber and a broad coalition of other groups strongly opposes this legislation. I plan to testify in opposition to bill if it is called.

Also posted for House Revenue committee consideration is HB 4680, also sponsored by Representative Welch, which would create a municipal gas Use Tax Law. The bill provides that beginning January 1, 2019, a municipality may impose a self-assessing purchaser tax rate of the lower of 2.4 cents per therm or 5% of the purchase price for the privilege of using in the municipality gas obtained in a purchase of out-of-state gas. Provides that, in the alternative, a purchaser may elect for a tax of 2.4 cents per therm that a delivering supplier maintaining a place of business in the State collects from the purchaser. Provides for registration requirements for self-assessing purchasers and delivering suppliers and includes procedures for self-assessing purchasers and delivering suppliers to submit returns and to remit the tax to the Department of Revenue. 

HB 4563, Breen, has been posted for consideration by House Revenue committee.  This bill is designed to provide a way to work around the federal $10,000 cap on the state and local tax deduction.  The legislation provides that taxpayers who make contributions to a school district foundation are also eligible for a property tax credit. The bill provides that the term "contribution" means a donation made by the taxpayer during the taxable year for providing scholarships or support (currently, scholarships only). It contains provisions concerning the calculation of the credit or abatement for contributions to school district foundations and the aggregate amount of the credit and abatement available for those contributions. Amends the School Code. Provides that payments under the evidence-based funding formula shall be reduced by the amount of qualified contributions received by the applicable school district foundation under the Invest in Kids Act.

It is unclear, as of today, which of the posted bills will actually be considered by the House Revenue committee next week.

The House  Economic Opportunity Committee is holding a hearing Feb 27.  HB 4081 has been posted for consideration although we are not yet sure whether the bill will be called.  

HB 4081 creates the Call Center Worker and Consumer Protection Act. It provides that an employer that intends to relocate a call center or portions of a call center from Illinois to another state or a foreign country must provide notice to the State Treasurer at least 120 days before the relocation. Authorizes a civil penalty not to exceed $10,000 for violations. Requires the Treasurer to compile and post on the Treasurer's website a list of employers that have relocated call centers. Requires an employer that relocates a call center from Illinois to another state or a foreign country to repay grants, loans, and tax benefits that may have been received. Effective January 1, 2018.  The Illinois Chamber strongly opposes this bill.

Rulemaking
The February 23 edition of the  Illinois Register did not contain any rulemaking by the Illinois Department of Revenue or the Illinois Department of Commerce and Economic Opportunity. Today's Illinois Register contains an index of Illinois Department of Revenue letter rulings issued during 2017.  

Tax Tribunal 
No new decisions were issued by the Tribunal this week.  Only one new case was filed with the Tribunal this week. The new case does not appear to raise any novel issues.  


Key Legislation

 

 

Business Regulation

 

Employment Law

 

Employment Law

 







Upcoming Events
 

March 12:  Tax Institute First Quarter meeting hosted by True Partners:  IDOR Director Connie Beard is our scheduled speaker.
 
April 2:  Keith speaks at the Chicago Tax Club spring conference at the Hyatt Lodge in Oak Brook.  Registration details to follow. 

June 12:  Tax Institute Second Quarter meeting hosted by Grant Thornton. Featured speaker TBD.  One hour of ethics training to be presented by Horwood Marcus & Berk.

 

Connect with the Chamber

© Illinois Chamber of Commerce
 

Not a member and want to learn more about the Illinois Chamber click here to contact Jeanette Anderson