Executive Director
Tax Institute

(217) 522-5512 ext. 231

All Key Chamber Legislation

Upcoming Events
October 28:
Illinois General Assembly returns to Springfield for the first day of the fall veto session.

November 12:
Illinois General Assembly returns to Springfield for the second week of the fall veto session.
October 25, 2019
State and Local Tax  
This Week 

Illinois General Assembly
The House and Senate have adjourned until the fall veto session.  The first week of the veto session is scheduled to begin on October 28.  The second, and final, week of the veto session is scheduled to begin on November 12.

The House Revenue committee is scheduled to meet on October 29.  The following bills are scheduled for consideration by the committee:

HB 3902 - Bristow -  Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that the exemption for materials, parts, equipment, components, and furnishings incorporated into or upon an aircraft applies permanently. Effective immediately. This legislation would revive and extend an exemption that was allowed to sunset a number of years ago.

SB 119 - Castro - Amends the Illinois Income Tax Act. Provides that a person required to file a federal Form 1099-K identifying a reportable payment transaction to a payee with an Illinois address shall also report to the Department of Revenue and to any payee with an Illinois address any information required by Section 6050W of the Internal Revenue Code with respect to third-party network transactions. Provides that third-party network transactions are subject to the $600 de minimis reporting requirements set forth in the Internal Revenue Code, rather than the de minimis reporting requirements otherwise applicable to third-party settlement organizations under the Internal Revenue Code. Provides that failure to provide that information shall result in a penalty for failure to file a tax return. Provides that the de minimis requirement for third-party network transactions shall be $1,000 and more than 3 transactions per reporting period. Provides that the Department of Revenue shall not share information gathered from Third Party Settlement Organizations with other federal, State, or local government entities. Provides that the amendatory Act applies for reporting periods beginning on or after January 1, 2020. Provides that failure to provide information shall result in a penalty under the Uniform Penalty and Interest Act.

SB 1042 - A House committee amendment was filed on Thursday to replace everything in the version of the bill that passed the Senate and replace it with an extension of the Savanna TIF.

HB 961 - Replaces everything after the enacting clause. Amends the Property Tax Code. Provides that, in a county with 3,000,000 or more inhabitants, for taxable years 2019 through 2023 (currently, 2020 through 2024), a taxpayer who has been granted a senior citizens homestead exemption need not reapply. Effective immediately.

SB 961 - see above.

New legislation
HB 3924 - Scherer -   Amends the Property Tax Code. Provides that a taxing district may establish a program to allow persons who will turn 60 years of age or older during the taxable year to volunteer to provide services within that taxing district in exchange for a reduction in the property tax liability of the primary residence of that person. Sets forth limitations on the amount of the reduction.

Property Tax Reform Task Force
The full Property Tax Relief Task Force is scheduled to meet next Monday.  The subcommittees are winding down.  Here is a  link to the Task Force webpage.

The subcommittee on Assessments and Exemption is scheduled to meet this Friday.  The agenda has been posted.

The full task force is scheduled to meet on Monday.

City of Chicago
The Mayor issued the City of Chicago Budget Overview on Wednesday. The Mayor also released a two page graphic summary of the proposed budget.

Tax-related Chicago proposed budget highlights:

The 2020 budget restructures the City's Ground Transportation Tax applied to rideshare companies by increasing the tax on single rides from $0.60 per ride to $1.13, and decreasing the tax on pool rides from $0.60 per ride to $0.53.
Additionally, a $1.75 surcharge on single rides and a $0.60 surcharge for pool rides will be applied to rideshare companies dropping off and picking up passengers in a designated downtown congestion area on weekdays between 6 am and 10 pm. These changes are anticipated to increase Ground Transportation Tax revenues by $40 million in 2020.

The City expects to implement a 3.0 percent excise tax on recreational cannabis sold within the City. According to the Mayor's analysis, this tax, along with anticipated increased sales tax revenue, is estimated to generate a total of $3.5 million of additional revenue in the first year of implementation.

The City will implement a new monitoring process
in 2020 to pursue outstanding tax and fee remittance from vendors engaged in contracts with the City. The City advises they will move to a new system that will ensure frequent and comprehensive account checks to expedite payments by City vendors, and to help more companies stay in compliance. The City anticipates these changes will yield up to $25 million in uncollected taxes and licensing fees next year.  We will provide additional details as they become available.

The proposed budget includes a two percent
increase to Personal Property Lease Tax applied to nonpossessory computer leases of cloud software and cloud infrastructure, bringing the total tax for this type of lease to 7.25 percent. The budget also includes an increase of 0.25 percent to the Restaurant Tax and an increase to the total
tax increment financing surplus.

The proposed budget includes an increase in Real Estate Transfer Tax based on the proposed progressive tax structure is included in the 2020 budget. These changes are anticipated to generate an additional $125.6 million in 2020. (Note: The City plans to seek legislative authorization for this change during the fall veto session in Springfield.)

The October 25 edition of the Illinois Register did not contain any proposed or adopted rulemakings by the Illinois Department of Revenue or the Illinois Department of Commerce and Economic Opportunity.

Court cases
Nothing new this week.

Tax Tribunal 
No new decisions were posted this week.  

The new cases filed at the Tribunal this week does not raise any novel issues.

The Governor's Office of Management and Budget issued its annual statutorily required  Illinois Economic and Fiscal Policy Report.

The Department of Commerce and Economic Opportunity (DCEO) has released  A Plan to Revitalize the Illinois Economy and Build the Workforce of the Future.

Save the Date next Tax Institute meeting - November 18

I've tentatively scheduled the next quarterly meeting of the Tax Institute for Monday afternoon November 18 from 2:00 - 4:00. 

At the meeting we will provide an update on the veto session which concludes the week of November 11. We will also provide a City of Chicago update - by then we will know the status of tax-related proposals by the Chicago of Chicago and veto session efforts by the City. I have also invited representatives of the Department of Commerce and Economic Opportunity to attend the meeting to discuss implementation of the new Data Center sales tax exemption and other economic development efforts of DCEO.  

As of now, we will hold the meeting at our offices at 300 S. Wacker Drive, Chicago. I'm also working on a better dial-in option for the meeting.  I hope to have additional details next week.  

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