Illinois to create independent tax appeal tribunal by 2013
By JOHN O’CONNOR The Associated Press December 26, 2011 6:28PM
ADVANCE FOR SUNDAY DEC 25 In this photo taken Dec. 13, 2011, Illinois Rep. John E. Bradley, D-Marion, reacts as tax break legislation passes on the Senate floor during session at the Illinois State Capitol in Springfield. The legislation that gave favorable tax provisions to Sears and the Chicago Mercantile Exchange also creates an independent tax tribunal to hear and rule on taxpayers' disputes with the state revenue department. (AP Photo/Seth Perlman)
Tax protest
cases in 2011
A new Illinois law requires the state to set up an independent tax tribunal by 2013. The Illinois Department of Revenue, which assesses taxes, also oversees the existing review system. Here are figures showing the resolution of the 1,018 tax protests in cases closed in the 2011 fiscal year:
Income tax protest cases
Closed 394
Withdrawn by taxpayer 147
Not challenged by Revenue Dept. 125
Settled 116
Settlement fully upholding Rev. Dept. 9
Ruled on at hearing 6
Ruling fully upholding Revenue Dept. 5
Sales, misc. tax cases
Closed 624
Withdrawn by taxpayer 221
Not challenged by Revenue Dept. 188
Settled 184
Settlement fully upholding Rev. Dept. 5
Ruled on at hearing 31
Ruling fully upholding Revenue Dept. 22
Source: Illinois Department of Revenue
Article Extras
Updated: December 27, 2011 11:48AM
SPRINGFIELD — Tucked away in a law Gov. Pat Quinn signed earlier this month to grant tax relief to major corporations is a provision that supporters say will go a long way toward reforming how taxes in general are protested in Illinois.
The legislation that gave tax breaks to Sears Holdings Corp. and CME Group Inc. — two prominent Illinois institutions that had threatened to leave — includes a plan to create an independent board that rules on taxpayers’ disputes with the state.
The law calls for a so-called tax tribunal to be set up by 2013. Details are still to be worked out, but the idea is to give taxpayers, whether individuals and businesses, the chance to protest assessments to someone not answering to the Illinois Department of Revenue, which assesses taxes in the first place and currently has last word on appeals.
The move is a way for Illinois lawmakers to show business interests they are serious about tax reform and fairness, said Senate Revenue Committee Chairwoman Toi Hutchinson (D-Olympia Fields), who sponsored the bill.
Currently, an Illinois taxpayer who wants to challenge an assessment may file a protest — but through the Revenue Department. An administrative law judge, a position created in 1995, hears the case, but the final decision is made by the Revenue director. A taxpayer may bypass the administrative review and challenge the assessment in circuit court, but the person or business first must pay the tax into a protest fund.
“If you want to challenge a decision by the Revenue Department, you have to challenge the people who said you were wrong,” Hutchinson said. “We’re looking for more fairness.”
Last year, just over 1,000 protests were filed in Illinois, and in 68 percent there was no ruling either because the agency didn’t object or the taxpayer didn’t pursue the case, according to agency spokeswoman Susan Hofer. Only 37 went to a hearing, and the agency was fully upheld in 27 of them, Hofer said.\
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