United States: Illinois Independent Tax Tribunal – What You Need To Know NOW!

Through Public Act 97-1129, Illinois established the Independent Tax Tribunal (the "Tax Tribunal") to largely replace the system of administrative hearings conducted by the Illinois Department of Revenue (the "Department").

Illinois Independent Tax Tribunal Jurisdiction

Beginning January 1, 2014, protests of notices of deficiency, notices of tax liability and notices of claim denial for more than $15,000 in tax, exclusive of penalty and interest, are under the jurisdiction of the Tax Tribunal. The Tax Tribunal also has jurisdiction over any matters involving penalties and interest in excess of $15,000.

Deadline to Transfer to Tax Tribunal is February 1, 2014

Taxpayers with appeals that meet the above jurisdictional criteria that were filed with the Department on or after June 1, 2013 have the ability to elect to transfer jurisdiction over those appeals to the Tax Tribunal. The election must be made before February 1, 2014. An election is made by filing a motion with the Department to have the protest transferred to the Tax Tribunal pursuant to Public Act 98-0024. After receipt of the taxpayer's motion requesting transfer of the appeal, the Department's Office of Administrative Hearings will notify the taxpayer or its representative of the specific procedures that need to be followed. If a timely election is not made, the case will stay with the Department. The Tax Tribunal and the Department have no plans to proactively notify taxpayers who are eligible to transfer their matter to the Tax Tribunal of the impending deadline.

Several factors may weigh in favor of transferring pending appeals to the Tax Tribunal.The most important factor is that the administrative law judges who will write the Tax Tribunal decisions are independent from the Department, and it is therefore believed that they will be more impartial than Department administrative law judges. Although Department decisions are published with taxpayer names and identifying data redacted, they are not authority that can be cited, and taxpayers' appeals of those decisions are to the lowest tier judicial forum, the circuit court. The opinions of the Tax Tribunal will be published, and decisions may be appealed by the Department or the taxpayer directly to the Illinois Appellate Court, which should result in a more consistent and transparent application of the tax law. These factors should ultimately create more cost-efficient settlement opportunities for taxpayers. However, taxpayers should keep in mind that if the matter cannot be resolved through a negotiated settlement, the Tax Tribunal is a public forum. Taxpayers seeking to keep their appeals confidential may prefer to leave their pending appeals with the Department, although a subsequent appeal from a Department decision will be a matter of public record.

Illinois Independent Tax Tribunal Procedure

Matters in the Tax Tribunal will be governed by the Illinois Supreme Court Rules, the Illinois Code of Civil Procedure and the Tax Tribunal Rules. Currently, proposed Rules for the Tax Tribunal are available on the Tax Tribunal's website.1 Adam P. Beckerink and Michael J. Wynne, the authors of this article, both served on different committees that had a hand in drafting a package of suggested rules. These suggested rules were largely followed by the Tax Tribunal in drafting the proposed Rules.2 The governor's office will file emergency Rules for the Tax Tribunal that will be published in the Illinois Register January 24, 2014. The emergency Rules for the Tax Tribunal will be virtually identical to the proposed Rules that are currently on the Tax Tribunal's website. Here are some key highlights:

  • The Department is required to file an answer to the taxpayer's petition that corresponds to the petition and must contain a specific admission or denial of each material allegation of fact contained in the petition; affirmative defenses, if any; and the relief sought by the Department.
  • A taxpayer, if not representing itself, is required to be represented by an attorney.
  • In general, all discovery is governed by the Illinois Supreme Court Rules, the Illinois Code of Civil Procedure and the Tax Tribunal Rules.

Proceedings before the Tax Tribunal begin with a taxpayer filing a petition. Currently, in order to file a petition with the Tax Tribunal, a taxpayer must file the petition with the Tax Tribunal in Chicago.3 A taxpayer must file an original and two copies of the petition with the Tax Tribunal and must file a copy of the petition with the Department. Petitions must be filed within the time limits set by the particular tax statute at issue.

Petitions are more like a Circuit Court complaint than the informal protest, which was previously filed with the Department. Petitions are required to contain separately numbered paragraphs stating, in clear and concise terms, a summary of the errors of fact or law that the taxpayer alleges have been made by the Department, together with a statement of facts or law upon which the taxpayer relies to establish said errors. Therefore, a taxpayer that makes the election to transfer its protest to the Tax Tribunal will need to make a motion in the Tax Tribunal to revise its protest to conform to the Tax Tribunal's petition requirements.The proposed Rules do not provide a specified time period within which a taxpayer must revise a transferred protest.

Once a petition is filed and the Department has filed its answer, we would anticipate that the parties would meet at the earliest opportunity to discuss the potential for narrowing the legal and factual issues, simplifying the process, and exploring the opportunity for settlement. This process also allows for the parties to agree how the case will move forward and set a time table for the litigation, and so it may accommodate settlement discussions.

It is currently anticipated and encouraged that communications between the parties, including service, will be accomplished through electronic mail. Additionally, the Tax Tribunal anticipates that pre-trial status conferences will be held by telephone. Further, it is important to note that unlike filing suit under the Protest Monies Act in circuit court, a taxpayer does not have to pay the assessed liability, penalties and interest to file a Tax Tribunal petition and challenge the assessment at the Tax Tribunal. However, a taxpayer is wise to remember that while it does not have to pay the assessment to challenge at theTax Tribunal, interest on the assessment continues to accrue while the matter is pending at the Tax Tribunal. Alas, counsel should be consulted on the strategic advantages and disadvantages of choosing the Tax Tribunal or the Protest Monies Act remedy.


1. http://www.illinois.gov/taxtribunal/rules/Pages/default.aspx  

2. Michael J. Wynne served on the Chicago Bar Association's ("CBA") subcommittee that drafted the suggested rules, which the Tax Tribunal is largely proposing for adoption. Adam P. Beckerink served on the Illinois State Bar Association's State and Local Tax Committee that reviewed and concurred on the CBA draft.

3. Once the Tax Tribunal is more established, petitions are also expected to be accepted in Springfield, Illinois.

This article is presented for informational purposes only and is not intended to constitute legal advice.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions