September 30: Illinois Chamber of Commerce Annual meeting. We will be holding our annual meeting at the Palmer House Hilton Chicago from 11:00 - 1:30. Registration is available at this link
October 19-21: First week of the House and Senate fall veto session.
October 26-28: Second week of the House and Senate fall veto session.
September 10, 2021
State and Local Tax
This Week
Illinois General Assembly
The House returned to Springfield September 9 and addressed energy legislation and also voted to accept the Governor's amendatory veto of ethics legislation, SB 539
The House passed its version of an energy bill on Thursday, SB 2408, The Senate was not in Springfield on September 9 to take up consideration of SB 2408.
There are some tax-related provisions in SB 2408 .
At p.226 of the amendment, subsection (g) of the definition of "high impact business" which requires revocation of High Impact designation is modified to delete the following language:
"However, the penalties for new wind power facilities or Wind Energy Businesses for failure to comply with any of the terms or conditions of the Illinois Prevailing Wage Act shall be only those penalties identified in the Illinois Prevailing Wage Act, and the Department shall not revoke a High Impact Business designation as a result of the failure to comply with any of the terms or conditions of the Illinois Prevailing Wage Act in relation to a new wind power facility or a Wind Energy Business."
There are amendments to the Property Tax Code.
At page 563, Section 1-130 of the Property Tax Code is amended to add a new subsection that provides that spent fuel pools and dry cask storage systems in which nuclear fuel is stored and is pending further or final disposal from a nuclear power plant that was decommissioned before January 1, 2021 shall be considered real property and shall be assessable.
At p. 565, Section 10-5 of the Property Tax Code dealing with solar energy systems is amended by the addition of the following subparagraph (D) to the definition of "solar energy system":
"Photovoltaic electricity generation systems subject to power purchase agreements or leases for solar energy between a third-party owner, an operator, or both, and an end user of electricity, where such systems are located on the end user of electricity's side of the electric meter and which primarily are used to offset the electricity load of the end user behind whose electric meter the system is connected. A system primarily is used to offset the electricity load of the end user of electricity if the system is estimated to produce 110% or fewer kilowatt-hours of electricity than consumed by the end user of electricity at such meter in the last 12 full months prior to the system being placed in service."
At page 566, Section 10-610(a) of the Property Tax Code, which is a portion of Division 18 dealing with wind energy property assessment is amended to provide that provisions of the Division apply through 2035 - current law states 2021.
Illinois Department of Revenue
The Department issued a statement late yesterday afternoon advising that they will waive any late estimated payment penalty for the newly-enacted SALT cap work around entity level tax. We are still awaiting additional guidance from the Department on, among other things how the election to be taxed at the entity level will be made and what other state taxes will qualify for the credit against the Illinois entity level tax.
The Department stated:
"The Illinois Department of Revenue (IDOR) will not assess penalty for late estimated payments due for tax years ending before December 31, 2022, because of the election to pay the entity-level tax under Public Act 102-0658. IDOR encourages taxpayers to make estimated payments to reduce the tax payment due when the return is filed.
Public Act 102-0658,enacted August 27, 2021, creates an entity-level tax for partnerships and subchapter S corporations allowing partners and shareholders to work around the federal cap on the deduction for state and local taxes effective for tax years ending on or after December 31, 2021. When a partnership or S corporation makes the election to pay the entity-level tax, it is required to make quarterly estimated payments if the tax due is expected to be $500 or greater or incur late payment penalties for the underpayment of estimated taxes per Illinois Income Tax Act Section 804.
However, for most taxpayers, two estimated payment deadlines have already passed and the third quarterly estimated payment for calendar-year filers is due on or before September 15, 2021. Partners and shareholders of pass-through entities should continue making all required quarterly installments even if they expect the pass-through entity to pay an entity-level tax."
Rulemaking
The September 10 edition of the Illinois Register did not contain any proposed or adopted rulemakings by the Illinois Department of Revenue or by the Department of Commerce and Economic Opportunity.
Court cases
No new tax-related court cases were released this week..
Tax Tribunal
No new decisions have been posted by the Tribunal this week.
