On the last day before House Bill (H.B.) 5192 would have become law without his signature or veto, Gov. Quinn signed H.B. 5192 into law as Public Act (P.A.) 97-1129. P.A. 97-1129 creates the Illinois Independent Tax Tribunal (the “Tribunal”). Members of Reed Smith’s state tax team were part of the working group of the Illinois State Chamber of Commerce Tax Institute and the Taxpayers’ Federation of Illinois that worked on the design and terms of the legislation, although the final product reflects hard bargaining by both the Illinois Department of Revenue and these taxpayer organizations.

Commencing July 1, 2013, taxpayers administratively protesting tax adjustments will for the first time have the opportunity to appear before judges not in the employ or control of the Illinois Department of Revenue (the “Department”). The Tribunal will have jurisdiction to hear all protests of asserted tax or penalty liability, or the denial of a refund that exceeds $15,000. The Department will retain jurisdiction over (i) protests of assessments made under the Property Tax Code, (ii) exemption applications, (iii) protests of notices of proposed assessments, (iv) tax liabilities that have become finalized by law, (v) informal administrative appeals functions, and (vi) challenges to administrative subpoenas issued by the Department. Also, a taxpayer and the Department may jointly petition the Tribunal for mediation.

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