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The City of Chicago has changed the terms of its voluntary disclosure (VDA) program. In addition to waiving all penalties for qualified participating taxpayers, the city will now also waive 50% of interest that would apply. This is a significant change as the city did not previously waive any interest as part of its VDA program. It also should be noted that the city provides for a limited look-back period of 4 years for qualified taxpayers participating in the program. If under audit an error rate of less than 10% is discovered for periods disclosed, the additional tax, interest and penalty will be due for the amount not previously disclosed.  If the error rate is greater than 10%, the Department reserves the right to dissolve the voluntary disclosure agreement. For more information regarding the VDA program, you can visit the City of Chicago website. (City of Chicago Tax Collection and Enforcement – Apply for Voluntary Disclosure of Business Taxes webpage)

(01/02/2018)

Illinois has enacted new electronic filing requirements for sales and use tax filers. Effective January 1, 2018, if a taxpayer’s annual gross receipts average $20,000 or more, the taxpayer will be required to file the following forms electronically:

 

  • Form ST-1, Sales and Use Tax and E911 Surcharge Return
  • Form ST-8, Tire User Fee
  • Form ST-4, Metropolitan Pier and Exposition Authority Food and Beverage Tax Return
  • Form ST-14, Chicago Soft Drink Tax Return
  • Form MC-1, Medical Cannabis Cultivation Privilege Tax Return


If a taxpayer is required to file electronically and does not, the following discounts or collection allowances for timely filed and paid returns will be disallowed:

 

  • 1.75% on form ST-1
  • 3% discount of the E911 surcharge and assessment fee on Form ST-1, Schedule B
  • $0.10 per tire collection allowance for the tire user fee on Form ST-8
  • 1.75% on Form ST-4
  • 1.75% on Form ST-14
  • 1.75% on Form MC-1


The electronic filing requirement can be waived if the taxpayer does not have internet access or it is a hardship to file electronically. The Illinois Department of Revenue will develop forms and procedures for the waiver application. Taxpayers should confirm their filing requirement as loss of the collection discounts would be significant.



The Department will determine who qualifies for the new electronic filing requirements and issue a notice to any taxpayer who is required to file electronically. Forms ST-1, ST-8, ST-4, ST-14, and MC-1 can be filed electronically for free by registering and using MyTax Illinois. To register, visit tax.illinois.gov. (Illinois Department of Revenue, Informational Bulletin FY 2018-05-A)
 

(12/18/2017)

Effective August 11, 2017, the Illinois State Treasurer is authorized to (at least annually) share with the Illinois Department of Revenue the names (and social security numbers, if available) of people who appear to own unclaimed property held by the State Treasurer. The Department shall notify the Treasurer if any of these people has filed an income tax return and will provide the last known address and any additional addresses of the person, except as prohibited by federal law. The Treasurer can deliver unclaimed property or pay the amount owed to someone if the following conditions are met:
 

  • The value of the property owed is $2000 or less;
  • The property is not tangible property or securities;
  • The last known address for the person according to Department records is less than 12 months old; and
  • The Treasurer has sufficient evidence that the person is the owner of the property and currently resides at the last known address.


If the unclaimed property has a value greater than $2000 or is tangible property or securities, the Treasurer will provide notice informing the person that he or she is the owner of unclaimed property and may file a claim with the Treasurer for the return of the property. (Public Act 100-0047 (HB 1808))
 

(11/28/2017)

The Cook County Department of Revenue has provided guidance to sweetened beverage distributors and retailers regarding the close-out process for the Cook County sweetened beverage tax. The tax has been repealed effective December 1, 2017, and the last tax returns/payments will be due on December 20, 2017. In the case that on December 1, 2017 there is unsold product on which tax was previously remitted, the Department has provided the following guidelines:

 

  • Retailers who are not registered with the Department and paid tax to a distributor must apply for a credit/refund from their distributors. Distributors should require documentation to substantiate a retailer’s claim.
  • After providing a credit/refund to a retailer, a distributor can then take a credit on their final tax return or apply for a refund from the Department.
  • Retailers who are registered with the Department pursuant to Sweetened Beverage Tax Regulations 2017-1 and 2017-4 can take a credit on their final tax return or apply for a refund. Documentation supporting the credit/refund request must be submitted.
  • Retailers that have in their inventory specific products on which tax was paid via the floor tax return and have not been sold must submit a refund application to the Department. Supporting documentation must show that these specific products have remained in inventory and are the same products for which the floor tax was originally remitted.


The Department has developed new forms that can be used to assist with the credit/refund process: 2017 Sweetened Beverage Retailer Inventory Credit Request Form and Schedule A, and Sweetened Beverage Tax Distributor Credit Form Schedule.
 

The Department may request additional documentation from the business seeking a credit/refund. If the claim cannot be substantiated by adequate books and records, it will not be allowed. Any documents that record the basis for a credit/refund should be retained by retailers and distributors for seven years. For additional details on the close-out process and the forms mentioned above, visit the Cook County Sweetened Beverage Tax webpage. (Sweetened Beverage Tax Close-Out Process, Cook County Department of Revenue)

(11/28/2017)

Effective July 1, 2017, Illinois has enacted an exemption from the Hotel Operators’ Occupation Tax for entities that are organized and operated exclusively for religious purposes and possess an active Exemption Identification Number (EIN).  The exemption applies when the entity acts as a hotel operator renting, leasing or letting rooms in furtherance of the purposes for which it is organized; or to entities that are organized and operated exclusively for religious purposes, possess an active EIN, and rent the rooms in furtherance of the purposes for which they are organized. For purposes of the Hotel Operators’ Occupation Tax, the term “hotel” now also includes retreat centers, conference centers and hunting lodges. (P.A. 100-213 (S.B. 587), Laws 2017)

(10/23/2017)

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