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August 10, 2018
State and Local Tax this week
Illinois General Assembly
The General Assembly returns to Springfield for the fall veto session on November 13. The House and Senate are scheduled to be in session November 13 through 15 and November 27 through 29.
No new tax-related legislation was filed this week.
The House Revenue committee has scheduled two joint hearings with the Gaming Subcommittee of the House Executive committee to take testimony on House Comittee amendment 3 to SB 7. The hearings are scheduled for August 22 in Chicago and October 3 in Springfield.
SB 7 is an omnibus gaming bill which would include a Chicago casino. There are tax implications to the gaming legislation. Among other things the amendment would amend the Illinois Income Tax Act to impose a "surcharge" on organization licensees under the Illinois Horse Raising Act and organization gaming licensees under the Illinois Gambling Act (this is the amended name of what is now the Riverboat Gambling Act.). Clearly, the imposition of a "surcharge" on a discrete group of taxpayers would be a problem from a constitutional standpoint, in light of the constitutional prohibition of multiple income taxes.
The following tax-related legislation was signed by the Governor this week:
HB 5176 - (P.A. 11-685) This legislation amends the Code of Civil Procedure. In provisions concerning notices of judicial sale, provides that, in counties with a population of more than 3,000,000, the notice that appears in the section of the newspaper in which real estate other than real estate that is being sold as part of a legal proceeding is commonly advertised must be published in a newspaper that is (i) different from the newspaper that publishes other notices required by those provisions and (ii) published in the township in which the real estate is located.
HB 5214 - (P.A. 100-686) Amends the Illinois Income Tax Act. Changes the definition of "applicant" and "related member". Provides that the annual allowable amounts shall be allocated by the Department of Commerce and Economic Opportunity if any portion of the unused allocated amount at the end of the first 3 calendar quarters of a calendar year (rather than 2 calendar quarters) are rolled into the total allocated amount for the next calendar quarter. Provides that the annual allowable amounts shall be allocated by the Department if tax credits for investments in minority-owned businesses, women-owned businesses, businesses owned by a person with a disability, or a business in a county with a population of 250,000 or less are limited to the first 3 calendar quarters of a calendar year and after which investors may claim the tax credits of any qualified new business venture.
HB 5253 - (P.A. 100-688) Amends the Illinois Administrative Procedure Act. Modifies the provisions requiring State agencies to issue an economic impact analysis when proposing new rules or amendments to rules that affect small businesses. Provides, among other requirements, that the economic impact analysis shall include: (1) a list of the industries that will have to comply with the proposed rule or amendment according to NAICS 2-digit codes; and (2) an identification of the types of impact that the proposed rule or amendment will have based on specified categories. Provides that when any rule or amendment to an existing rule is proposed for which a small business economic impact analysis is required, the adopting State agency must provide the information specified as a part of its filing, and that the information will be published in the Illinois Register. Provides that the Department of Commerce and Economic Opportunity shall place notification of all proposed rules affecting small business on its website, together with specified information. Defines "small business". Makes conforming changes.
SB 2958 - (P.A. 100-722) Amends the State Tax Lien Registration Act. Provides that the notice of tax lien shall also include the county or counties where the real property of the debtor to which the lien will attach is located. Provides that a tax lien that is filed in the registry shall be attached to all of the existing and after-acquired real and personal property of the debtor.
SB 3212 - (P.A. 100-731) Amends the Illinois Income Tax Act. Provides that nothing in the Act prohibits the disclosure of information by officials of a county or municipality involving reports of damaged property or the owners of damaged property if that disclosure is made to a township or county assessment official in connection with the natural disaster credit. Amends the Freedom of Information Act. Repeals a Section providing that nothing in the Act prohibits the disclosure of information by officials of a county or municipality involving reports of damaged property or the owners of damaged property if that disclosure is made to a township or county assessment official in connection with the natural disaster income tax credit.
The following bill was vetoed by the Governor:
HB 4922 - (A copy of the Governor's veto message is at this link ) Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that it is an unlawful practice to offer to consumers at retail a rebate made on a rebate card, rather than a stored-value card, that charges dormancy fees or other post-issuance fees. Defines terms. Excludes gift cards issued under the Revised Uniform Unclaimed Property Act, payroll cards issued under the Illinois Wage Payment and Collection Act, certain stored-value cards, and cards issued for in-store credit from the scope of the term "rebate card".
Rulemaking
The August 10 edition of the
Illinois Register did not contain any new rulemakings by the Illinois Department of Revenue or t
he Department of Commerce and Economic Opportunity.
The Illinois Department of Revenue adopted one rulemaking amending the Use Tax rules.The summary and purpose of the rulemaking by the Department states as follows:
"This rulemaking adds a new Section to the Use Tax regulations providing that the presence of an out-of-State retailer or its representative in Illinois for the purpose of engaging in trade show activities establishes nexus for the retailer and requires collection of Use Tax on all sales into Illinois. The rule, however, creates a "safe harbor" for retailers at trade shows. Provided that a retailer meets 3 conditions, the retailer's presence at a trade show will not trigger collection of Use Tax on sales into Illinois. The three conditions are that the retailer attends no more than 2 trade shows per calendar year; is physically present at those 2 trade shows for an aggregate total of no more than 8 days during any calendar year; and combined gross receipts from sales made at the 2 trade shows during any single calendar year do not exceed $10,000. The regulation describes the types of activities that count toward the 8-day physical presence limitation; sets out how a "day" is calculated; and provides additional information to assist retailers in determining whether their activities fall within the safe harbor created by the rule. The rule specifies that any sales made in Illinois during the trade show (using the sourcing rules at Section 270.115) are subject to Retailers' Occupation Tax Act and applicable local taxes. The rule defines "trade show activities," and provides examples of trade shows that are included within or excluded from the scope of the regulation."
Publications
Please send me links to your publications for inclusion in the newsletter. The Illinois Chamber also maintains the
Chamber Dispatch Blog on our website. This blog is is open to the general public. We are happy to receive short submissions from members for inclusion on the blog. We can also include short summaries with links to articles or publications. Contact me for additional details on how to participate.
Tax Tribunal
No new decisions were issued by the Tribunal this week. None of the new cases recently filed with the Tax Tribunal raise unique issues..
Save the Date
The Tax Institute Third Quarter meeting is September 19 from 2:00 - 4:00 hosted by Grant Thornton. Meeting details will be forthcoming.
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