Governor Rauner signed House Bill 5527 into law that amends the Illinois Revenue Act.
HB 5527 is now Public Act 99-0641 and is effective January 1, 2017.
Summary: This legislation requires state paid tax return preparers to place the federal Preparer Tax Identification Number on Illinois tax returns.
Background: House Bill 5527 encompasses recommendations of the Illinois Tax Return Preparation Task Force (PDF), created by law to provide the Illinois General Assembly guidance on how to appropriately regulate commercial tax preparers. Proposals are surfacing in states throughout the country to create licenses and regulatory oversight of state tax preparers. Currently, four states regulate state tax preparers—Oregon, California, New York and Maryland. The Tax Preparers Oversight Act creates a uniform system for the Illinois Department of Revenue to oversee paid state tax preparers for the work they do here and in other states where the PTIN is used. The legislation also requires IDOR to develop rules for barring and fining tax preparers for good cause and to enter into an agreement with the Internal Revenue Service to share PTIN information. This legislation is closely aligned to federal tax processes by utilizing the PTIN as the Illinois preparer identification and will compliment proposed federal legislation to reinstate the IRS registered tax preparer program.
Conclusion: Public Act 99-0641 promotes the highest levels of ethical conduct and professional standards to protect taxpayers. This legislation recognizes CPAs, attorneys and enrolled agents’ training and licensure who follow state and federal tax regulations without imposing additional regulatory burdens and marketplace confusions that would create barriers to doing business in Illinois.
IDOR Implementation: Consistent with Public Act 99-0041, the Illinois Department of Revenue has published Proposed Administrative Rules to implement provisions of the Act for tax year 2017.