Part 100: INCOME TAX

Section 100.7340 Correction of Underwithholding or Overwithholding (IITA Section 704) a) Underwithholding. If, as a result of underwithholding, a return is filed for a return period under this section and less than the correct amount of tax required to be deducted and withheld is…

Section 100.7350 Domestic Service Employment (IITA Sections 704 and 704A) a) On and after January 1, 1998, every employer who deducts and withholds or is required to deduct and withhold tax from a person engaged in domestic service employment, as that term is defined in IRC secti…

Section 100.7360 Definitions and Special Provisions Relating to Reporting and Payment of Income Tax Withheld (IITA Sections 704 and 704A) For purposes of the provisions of IITA Sections 704 and 704A: a) Date of withholding. Income tax is withheld on the date payment of compensati…

Section 100.7370 Penalty and Interest Provisions Relating to Reporting and Payment of Income Tax Withheld (IITA Sections 704 and 704A) a) Failure to file returns. In addition to any other penalties imposed by the IITA, an employer failing to file a quarterly return or the annual …

Section 100.7380 Economic Development for a Growing Economy (EDGE) and Small Business Job Creation Credit (IITA Section 704A(g) and (h)) a) EDGE Credit. An eligible taxpayer who makes an election under this subsection (a) shall be allowed a credit against payments required under …

Section 100.7381 REV Tax Credit (IITA Section 704A(g-1)) a) On or after January 1, 2025, with respect to the portion of a REV Illinois Credit that is calculated based on the incremental income tax attributable to new employees and retained employees, a taxpayer may elect, in acco…

Section 100.7382 MICRO Tax Credit (IITA Section 704A(g-2)) a) On or after January 1, 2025, with respect to any portion of a Manufacturing Illinois Chips for Real Opportunity (MICRO) Illinois Credit that is based on the incremental income tax attributable to new employees or retai…

Section 100.7385 Live Theater Production Tax Credit (IITA Section 704A(k)) a) An employer may claim a Live Theater Production Tax Credit against withholding payments due under IITA Section 704A(c) for a non-profit theater production. (IITA Section 704A(k)) b) For purposes of the …

Section 100.7386 Local Journalism Sustainability Tax Credit (IITA Section 704A(k)) a) A taxpayer who is issued a tax credit certificate under the Local Journalism Sustainability Act for a taxable year shall be allowed a credit against payments due under IITA Section 704A(c). (IIT…

Section 100.7390 Minimum Wage Tax Credit (IITA Section 704A(i)) a) Minimum Wage Credit. Each employer with 50 or fewer full-time equivalent employees during the current reporting period may claim a credit against the payments due under IITA Section 704A in an amount equal to the …

Section 100.8000 Payment of Estimated Tax (IITA Section 803) a) Requirement to Pay Estimated Tax. Every taxpayer other than an estate, trust, partnership, subchapter S corporation or farmer is required to pay estimated tax for the taxable year, in such amount and with such forms …

Section 100.8010 Failure to Pay Estimated Tax (IITA Sections 804 and 806) a) Penalty Imposed. Except as otherwise provided, IITA Section 804(a) imposes a penalty, computed in the manner and at the rate prescribed under Section 3-3 of the Uniform Penalty and Interest Act, upon an …

Section 100.9000 General Income Tax Procedures (IITA Section 901) a) Collection procedure. The Illinois income tax system basically is one of self-assessment. In general, each person or taxpayer liable for tax is required to file a prescribed form of return showing the facts upon…

Section 100.9010 Collection Authority (IITA Section 901) In general. The Department shall collect the taxes imposed by the Act and shall pay all monies received thereunder into the State Treasury as provided by IITA Section 901. (Source: Amended at 24 Ill. Reg. 10593, effective J…

Section 100.9020 Child Support Collection (IITA Section 901) a) Effective January 1, 1996, the Department of Revenue has been given the statutory responsibility of collecting certain child support arrearages. b) Upon certification of past due child support amounts from the Depart…

Section 100.9100 Notice and Demand (IITA Section 902) a) In general 1) Notice required. Except as provided in subsection (b) below, the Director or his delegate shall issue written notice and demand for payment for any unpaid portion of taxes, penalties, and interest imposed by t…

Section 100.9200 Assessment (IITA Section 903) a) In general. 1) Returns. A) The amount of tax shown to be due on a taxpayer's return shall be deemed assessed on the date of the filing of the return. If upon verifying the taxpayer's properly filed return the Department finds that…

Section 100.9210 Waiver of Restrictions on Assessment (IITA Section 907) a) Payment; Form IL-870. Whether or not a notice of deficiency has been issued, the taxpayer shall have the right at any time to waive the restrictions on assessment and collection of the whole or any part o…

Section 100.9300 Deficiencies and Overpayments (IITA Section 904) a) Examination of return The Department shall examine a return as soon as practicable after it is filed to determine the correct amount of tax. If for reasons other than mathematical error (see Section 100.9200(a)(…

Section 100.9310 Application of Tax Payments Within Unitary Business Groups (IITA Section 603) a) In general 1) This Section relates to the exercise of the election provided in IITA Section 603 with respect to overpayments and liabilities that arise as the result of: A) the filin…

Section 100.9320 Limitations on Notices of Deficiency (IITA Section 905) a) In General 1) Except as otherwise provided in this Section, no notice of deficiency for a taxable year may be issued later than 3 years after the date the return for that taxable year was filed or deemed …

Section 100.9330 Further Notices of Deficiency Restricted (IITA Section 906) a) No further notice after final department decision or prior notice. The Department shall not issue a further or additional notice of deficiency for any taxable year for which a notice of deficiency pre…

Section 100.9400 Credits and Refunds (IITA Section 909) a) In General. The Department, within the applicable period of limitations for a claim for refund, shall credit the amount of any overpayment, including interest allowed on the overpayment, against any liability for tax impo…

Section 100.9410 Limitations on Claims for Refund (IITA Section 911) a) In General Except as otherwise provided in this Section, no credit or refund shall be allowed or made with respect to any year unless a claim for refund or credit was filed on or before the later of: 1) 3 yea…

Section 100.9420 Recovery of Erroneous Refund (IITA Section 912) a) An erroneous refund shall be considered a deficiency of tax on the date made, and shall be deemed assessed and shall be collected as provided in IITA Sections 903 and 904 (see 86 Ill. Adm. Code 100.9200, 100.9300…

Section 100.9500 Access to Books and Records (IITA Section 913) All books and records and other papers and documents which are required by the Act to be kept shall, at all times during the business hours of the day, be subject to inspection by the Department or its duly authorize…

Section 100.9510 Taxpayer Representation and Practice Requirements The rules pertaining to taxpayer representation at hearings before the Department are found at 86. Ill. Adm. Code 200. (Source: Amended at 12 Ill. Reg. 14307, effective August 29, 1988)

Section 100.9520 Conduct of Investigations and Hearings (IITA Section 914) The rules of Practice and Procedure for Hearings before the Illinois Department of Revenue are found at 86 Ill. Adm. Code 200. (Source: Amended at 12 Ill. Reg. 14307, effective August 29, 1988)

Section 100.9530 Books and Records a) General Requirements 1) Every person liable for any tax imposed by the IITA shall keep books and records sufficient to substantiate all information reported on any income tax, withholding or information return required under the IITA. 2) The …

Section 100.9600 Administrative Review Law (IITA Section 1201) a) Circuit Court review; application and scope; remand procedure. IITA Section 1201 states that the provisions of the Administrative Review Law as contained in Article III of the Code of Civil Procedure [735 ILCS 5/Ar…

Section 100.9700 Unitary Business Group Defined (IITA Section 1501) a) Scope This Section is designed to clarify the meaning of IITA Section 1501(a)(27), defining "unitary business group". This definition became effective for tax years ending on or after December 31, 1982. b) Per…

Section 100.9710 Financial Organizations (IITA Section 1501) a) General Definition. The term "financial organization" is defined in IITA Section 1501(a)(8)(A) to mean any bank, bank holding company, trust company, savings bank, industrial bank, land bank, safe deposit company, pr…

Section 100.9715 Transportation Companies (IITA Section 304(d)) a) Transportation company. The term "transportation company" means any person deriving 80 percent or more of its gross income, averaged over a period of three years, which includes the current tax year and the immedi…

Section 100.9720 Nexus a) IITA Section 201(a) imposes the Illinois Income Tax, a tax measured by net income, on individuals, corporations, trusts and estates for the privilege of earning or receiving income in or as a resident of this State. IITA Section 201(c) imposes a second t…

Section 100.9730 Investment Partnerships (IITA Section 1501(a)(11.5)) a) For taxable years ending on or after December 31, 2004, an "investment partnership" is exempt from Illinois income taxation. (IITA Section 205(b)) For tax years ending before December 31, 2023, the term "inv…

Section 100.9750 Corporation, Subchapter S Corporation, Partnership and Trust Defined (IITA Section 1501) a) In general. IITA Section 102 provides that, except as otherwise expressly provided or clearly appearing from the context, any term used in the IITA shall have the same mea…

Section 100.9800 Letter Ruling Procedures a) For Department rules concerning Private Letter Rulings, see 2 Ill. Adm. Code 1200. b) For Department rules concerning the binding effect of Private Letter Rulings, see 2 Ill. Adm. Code 1200. c) For Department rules concerning the recis…

Section 100.9900 Tax Shelter Voluntary Compliance Program a) Section 35-5(a) of the Tax Shelter Voluntary Compliance Law [35 ILCS 20/35-5(a)] provides that the Department shall establish and administer a tax shelter Voluntary Compliance Program as provided in this Section for eli…

Section 100.9910 State Tax Preparer Oversight Act [35 ILCS 35] a) Definitions 1) Income Tax Return Preparer A) The term "income tax return preparer" means any person who prepares for compensation, or who employs one or more persons to prepare for compensation, any return of tax i…