On May 27th, a tax amnesty and collections bill (SB0377) passed both legislative houses adding Illinois to the list of states trying to accelerate tax receipts.
The following is a summary of the major provisions of the Illinois bill:
For known outstanding past due debts:
- Delinquent accounts under $1,000 are authorized to be sold to third party collection agencies.
- State agencies are authorized to enter into deferred payment plans for the purpose of satisfying a past due debt. The deferral must include at least 10 percent down, a total term not to exceed two years and applicable interest will be collected.
- State agencies are authorized to compromise up to 20 percent of a past due debt if the balance of the past due debt is collected within six months of the agreement plus applicable interest.
For unknown taxes due between 6/30/2002 and 7/1/2009:
- For the taxpayer’s voluntary payment between October 1, 2010 and November 8, 2010 of unknown taxes due, no interest, penalty or civil or criminal prosecution shall apply. This program is not applicable to amounts already at issue with Illinois and invalid if there is a failure to pay all taxes due.
- Taxes not paid under this amnesty program which are subsequently assessed or collected are subject to 200 percent of the “normal” interest and penalties.
This bill awaits action by Governor Quinn.
The complete text of SB0377 can be found here.
Other states that have current amnesty/collections programs are Maine (through 11/30/2010), Florida (7/1/2010 through 9/30/2010) and Pennsylvania (through 6/18/2010).
Under U.S. Treasury Department guidelines, we hereby inform you that any tax advice contained in this communication is not intended or written to be used, and cannot be used by you for the purpose of avoiding penalties that may be imposed on you by the Internal Revenue Service, or for the purpose of promoting, marketing or recommending to another party any transaction or matter addressed within this tax advice. Further, RubinBrown LLP imposes no limitation on any recipient of this tax advice on the disclosure of the tax treatment or tax strategies or tax structuring described herein.