Illinois HB 2755: 2025–2026 Tax Amnesty Programs Explained

The Illinois Department of Revenue (ILDOR) has announced significant changes due to Illinois House Bill 2755 (IL HB 2755). This bill introduces several tax amnesty programs scheduled to take place at various times in 2025 and 2026. These programs aim to encourage taxpayers to remit all taxes owed from designated periods by waiving all penalties and interest.

Details of the Amnesty Programs

1. General State-Imposed Taxes

The general state-imposed tax amnesty will apply to taxes owed for the periods after June 30, 2018, and before July 1, 2024. Taxpayers must remit any taxes due for these periods to the ILDOR between October 1, 2025, and November 15, 2025. This initiative is part of the broader effort to raise revenue for the state. Exclusions from amnesty include taxes not collected by IDOR (ex. Property taxes), Motor Fuel Use Tax (MFUT) (i.e. International Fuel Tax Agreement (IFTA) liabilities), and non-tax liabilities, such as licensing fees, permits, etc. All other tax types qualify in the eligible tax periods.

2. Remote Retailer Taxes

The remote retailer tax amnesty will cover taxes owed for the periods between January 1, 2021, and June 30, 2026. Eligible transactions include sales of tangible personal property by remote retailers to Illinois addresses. Taxes should be remitted to the state between August 1, 2026, and October 31, 2026. A remote retailer is defined as a retailer that does not maintain physical presence in the state but sells tangible personal property to Illinois customers. More information will be shared as this program window gets closer.

3. Franchise Taxes and License Fees

The franchise tax and license fee amnesty will apply to taxes owed for the periods between June 30, 2019, and June 30, 2025. Taxpayers can remit these taxes to the Illinois Secretary of State (ILSOS) between October 1, 2025, and November 15, 2025. Upon remittance, the ILSOS will waive all interest and penalties.

Potential Taxpayer Benefits

Participating in the tax amnesty programs offers several benefits to taxpayers:

• Financial Relief: By remitting all owed taxes during the amnesty periods, taxpayers can avoid paying penalties and interest, which can significantly reduce their financial burden.
• Compliance: Taking advantage of the amnesty programs allows taxpayers to become compliant with state tax laws, potentially avoiding future legal issues or audits.
• Peace of Mind: Settling outstanding tax liabilities can provide peace of mind, knowing that all dues are cleared and there are no lingering tax issues.
• Encouragement for Future Compliance: The amnesty programs can encourage taxpayers to maintain compliance with tax obligations in the future, fostering a culture of timely tax payments.

Takeaway

Taxpayers who owe any of the eligible taxes for the specified periods should take advantage of these amnesty programs. Remitting all taxes during the program periods will help avoid interest and penalties, providing significant financial relief.

For more information on these programs, you can visit the IDOR website and their Informational Bulletin.

Please reach out to a member of your Porte Brown advisory team if you think you can benefit from these programs or have any questions.