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Illinois Independent Tax Tribunal


Illinois Governor Pat Quinn signed the Illinois Independent Tax Tribunal Act of 2012 into law (HB 5192). The Act creates an independent tribunal that will resolve certain disputes between taxpayers and the Department of Revenue starting July 1, 2013. 

Purpose of the Tax Tribunal

According to the Act, the purpose of the Tribunal is "To increase public confidence in the fairness of the State tax system...." It goes on to state that "By establishing an independent tax tribunal, this Act provides taxpayers with a means of resolving controversies that ensures both the appearance and the reality of due process and fundamental fairness."

Taxpayers that wish to protest a tax determination made by the Department of Revenue may file a petition with the Tribunal, which will ". . . foster the settlement or other resolution of tax disputes to the extent possible...."

Tax Tribunal Jurisdiction 

The Tax Tribunal will have jurisdiction over Department of Revenue determinations including Notice of Deficiency, Notice of Tax Liability, Notice of Claim Denial, or Notice of Penalty issued under tax Acts such as,

  • The Income Tax Act
  • The Use Tax Act
  • The Service Use Tax Act
  • The Retailers Occupation Tax Act
  • The Motor Fuel Tax Law
  • See p. 10 of the bill for a complete list.

Furthermore, the Tribunal's jurisdiction is limited to cases where the amount owed by the taxpayer for the year or audit period exceeds $15,000 before penalties and interest, as reflected in Department notices.

The Tribunal will not have jurisdiction to review:

  • assessments made under the Property Tax Code;
  • ". . . any decisions relating to the issuance or denial of an exemption ruling for any entity claiming exemption . . ." from any state tax;
  • notices of proposed liability or intent to take some action;
  • ". . . any proceedings of the Department's informal administrative appeals function . . .;"
  • actions taken by the Department regarding tax liabilities that have become finalized by law, such as liens, levies, revocations of licenses;
  • challenges to administrative subpoena's issued by the Department.

Tax Tribunal Judges

The Illinois Governor, with the "advice and consent" of the Senate, will appoint a Chief Administrative Law Judge to be the Tax Tribunal executive. The Chief Judge will serve a 5-year term. In addition, the Governor can appoint up to 3 additional administrative law judges with the Senate's input and approval.

All the judges will begin serving during the same time period. However, the additional administrative judges will serve 4-year terms.

Appeals of Tax Tribunal Decisions

"The taxpayer and the Department are entitled to judicial review of a final decision of the Tribunal in the Illinois Appellate Court, in accordance with Section 3-113 of the Administrative Review Law."

 

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Avalara Author
Will Frei
Avalara Author Will Frei
Will Frei covers sales tax news including best practices, legislation and sales tax technology. He is the Social Media Manager at Avalara.