Illinois Administrative Code
Title 86 - REVENUE
Part 140 - SERVICE OCCUPATION TAX
Subpart N - CLAIMS TO RECOVER ERRONEOUSLY PAID TAX
Section 140.1405 - Disposition of Credit Memoranda by Holders Thereof
Universal Citation: 86 IL Admin Code ยง 140.1405
Current through Register Vol. 48, No. 38, September 20, 2024
a) Assignment of Credit Memoranda
1) Credit memoranda issued in accordance with
the provisions of the Act may be assigned or transferred only after a request
for that purpose is filed with the Department upon forms prescribed and
furnished by it, and subject to the following conditions:
A) That the assignment is made to a person
who is subject to the Retailers' Occupation Tax Act, Use Tax Act, Service
Occupation Tax Act or Service Use Tax Act, the Municipal Retailers' Occupation
Tax Act, the Municipal Use Tax Act, the Municipal Service Occupation Tax Act,
the County Retailers' Occupation Tax Act, the County Supplementary Retailers'
Occupation Tax Act, the County Service Occupation Tax Act, the County
Supplementary Service Occupation Tax Act, the County Use Tax Act, the County
Supplementary Use Tax Act, Section 4 of the Water Commission Act of 1985,
subsections (b), (c), and (d) of Section 5.01 of the Local Mass Transit
District Act, or subsections (e), (f) and (g) of Section 4.03 of the Regional
Transportation Authority Act;
B)
that there is no proceeding pending to establish an unpaid liability against
the assignor pursuant to notice given of the Department's proposal to assess an
amount against him under said Acts, and
C) that there is no established assessment or
admitted liability or interest or penalty unpaid by the assignor, under said
Acts.
2) Provided, that
if the amount of the credit memorandum must first be applied, in whole or in
part, against an established unpaid assessment which has been issued to the
claimant-assignor, or in total or partial liquidation of an unpaid admitted tax
liability, or unpaid penalty, or unpaid amount of interest, due from the
claimant-assignor, notice to this effect shall be given the claimant-assignor
by the Department. If any balance is due such claimant-assignor, after
application of the credit memorandum in the manner and to the purposes
aforesaid, such balance may be assigned upon receipt by the Department of
instructions to that effect. If there are no unpaid established assessments or
unpaid admitted tax liabilities, or unpaid penalties, or unpaid amounts of
interest, due from the claimant-assignor, and if there are no pending
proceedings as herein outlined against the claimant-assignor, and if the
contemplated assignee is a person who is subject to said Acts, the request for
leave to assign shall be approved; the original credit memorandum shall be
cancelled, and a new credit memorandum shall be issued to the assignee in the
amount shown on the cancelled memorandum. However, before a credit memorandum
is issued to the assignee, the amount of such credit shall be applied, to the
extent which may be necessary, in liquidation of any established or admitted
unpaid liability due from the assignee under the Retailers' Occupation Tax Act,
the Use Tax Act, the Service Occupation Tax Act, the Service Use Tax Act, the
Municipal Retailers' Occupation Tax Act, the Municipal Use Tax Act, the
Municipal Service Occupation Tax Act, the County Retailers' Occupation Tax Act,
the County Supplementary Retailers' Occupation Tax Act, the County Service
Occupation Tax Act, the County Supplementary Service Occupation Tax Act, the
County Use Tax Act, the County Supplementary Use Tax Act, Section 4 of the
Water Commission Act of 1985, subsections (b), (c), and (d) of Section 5.01 of
the Local Mass Transit District Act, or subsections (e), (f) and (g) of Section
4.03 of the Regional Transportation Authority Act, and a credit memorandum for
the balance of the credit, if any, shall then be issued to the assignee:
Provided, that there is no proceeding pending against the assignee to establish
an unpaid liability against him under any of said Acts. If a proceeding to
establish such an unpaid liability is pending, the credit memorandum shall be
held by the Department until such proceeding is concluded; and if such
proceeding results in the issuance of an assessment which becomes final, the
credit shall be applied by the Department, to the extent which may be
necessary, in liquidation of such assessment or any interest that may accrue
thereon, and the balance of the credit, if any (after cancellation of the
credit memorandum applied in liquidation of said assessment), shall be issued
in the form of a new credit memorandum and delivered to the assignor for
transmittal to the assignee.
b) Submission of Credit Memoranda With Tax Returns
1) Credit memoranda, in the hands of
the original claimant or of his assignee, may be submitted to the Department,
along with tax returns, in payment of any of said taxes incurred by the holder
of such credit memoranda. The holder of the credit memorandum may also use it
to pay any penalty or interest that may be due from him to the Department under
the Retailers' Occupation Tax Act, the Use Tax Act, the Service Occupation Tax
Act, the Service Use Tax Act, the Municipal Retailers' Occupation Tax Act, the
Municipal Use Tax Act, the Municipal Service Occupation Tax Act, the County
Retailers' Occupation Tax Act, the County Supplementary Retailers' Occupation
Tax Act, the County Service Occupation Tax Act, the County Use Tax Act, the
County Supplementary Use Tax Act, Section 4 of the Water Commission Act of
1985, subsections (b), (c), and (d) of Section 5.01 of the Local Mass Transit
District Act, or subsections (e), (f), and (g) of Section 4.03 of the Regional
Transportation Authority Act.
2)
If, after applying any such credit memorandum against the amount of liability
shown to be due by the tax return with which the credit memorandum is
submitted, there is a balance of the credit memorandum in favor of the
taxpayer, the Department will cancel the credit memorandum which the taxpayer
submits with his return and will issue and deliver to such taxpayer a new
credit memorandum for such balance. This process will be followed until the
credit, to which such taxpayer is entitled, is exhausted. However, any new
credit memorandum, which is issued for a balance of credit due the taxpayer
after applying the amount of a credit memorandum to the payment of current
taxes, is subject to the prior rights of the Department to the same extent that
such prior rights take precedence when a credit memorandum is first issued (see
Section
140.1401(d)
of this Subpart) or when leave to assign a credit memorandum is requested (see
Section
140.1405(a)
of this Subpart).
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