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Marty Green's Capitol Update
Choreographed Proceedings Make for a Quiet Spring Session
So far, it’s been a quiet spring legislative session, with House and Senate leaders carefully choreographing proceedings to avoid highly controversial issues. Of course, it’s not surprising, given the recent March 19 primary election, as incumbent legislators likely made moves to avoid difficult votes that could have bitten them at the ballot boxes. With the election behind us, I anticipate we’ll be seeing more activity livening things up around Springfield soon.
On the budget and revenue front, both the House and Senate Revenue Committees heard testimony last week from the Illinois Department of Revenue (IDOR), Governor’s Office of Management and Budget, and Commission on Government Forecasting and Accountability on revenue forecasts for fiscal years 2024 and 2025. Notably, revenue forecasts for fiscal year 2024 have been better than expected, and the state is anticipating a budget surplus of roughly $1.9 billion. Certainly, a budget surplus and positive fiscal forecast create a different dynamic than we’ve seen in previous years when the state faced budget crises. However, with an anticipated weaker economic climate ahead, reporting agencies have a more cautious approach to Illinois’ fiscal year 2025 revenue picture.
Additionally, we’re keeping a close eye on two recent regulatory developments: the Illinois Department of Financial and Professional Regulation’s (IDFPR’s) renewal and payment policy email and a federal court’s ruling on the Corporate Transparency Act. Updates on these two issues are provided in detail below in the Policy and Politics section of this newsletter.
As always, we’re continuing to closely monitor these and other legislative and regulatory activities and will keep you informed through this newsletter, special alerts, daily postings on the Government Relations landing page, and our tracking reports (red banner below).
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LATEST LEGISLATION
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Proposed Property Tax Code Amendments Address Tax Incentives
SB 2911 provides that commercial or industrial properties that receive a property tax incentive in accordance with an intergovernmental agreement with a taxing district are excluded from distributions from local government when a surplus occurs. Status: Pending second reading in the Senate.
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Legislation Seeks to Restore Cost-of-Living Adjustment
HB 4998 amends the Income Tax Act by restoring the cost-of-living adjustment that was removed in last year’s revenue omnibus legislation. Status: Pending House Revenue Committee.
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New Process Proposed for Obtaining Senior Citizen Homestead Exemptions
SB 2878 provides that senior citizens who are receiving a homestead exemption in Cook County don’t have to reapply for the exemption each year. The legislation also provides a review of all senior citizen homestead exemptions instead of an audit. Status: Pending third reading in the Senate.
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Legislation Examines Property Tax Refund Decisions
HB 2232 (House Committee Amendment No. 1) would allow for property tax refunds due to a Property Tax Appeal Board decision to be collected within 20 years of the decision. It also establishes a threshold amount for old refunds that can be disbursed by the department with a cap at $5 million per year. Status: Pending second reading in the House.
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Employee Whistleblower Protections Enhanced
HB 5561 amends the state’s Whistleblower Act by changing the definitions of employees and employers and broadly defines adverse employment and retaliatory actions. The bill prohibits a retaliatory action when an employee discloses or threatens to disclose information about an employer’s activities, policies, or practices that may violate a state or federal law, rule, or regulation, or pose a substantial and specific danger to public safety. Due to the board nature of definitions, the business community opposes this legislation and is actively working with the bill’s sponsor. Status: Pending second reading in the House.
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Bill Seeks Transparency Related to Employee Pay Stubs
SB 3208 provides that every employer shall, upon an employee’s request, permit an employee to inspect their pay stubs. The employer may require employees to request inspections in writing and may provide specific forms for the requests. The bill also requires employers to maintain records of wages paid each day, along with employees’ names and addresses. Additionally, the bill requires employers to provide employees with a pay stub for each pay period rather than an itemized statement of deductions made from employees’ wages for each pay period. Status: Pending third reading in the Senate.
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Proposed Amendments to Biometric Information Privacy Act
SB 2979 amends the Biometric Information Privacy Act by defining electronic signature as an electronic sound, symbol, or process associated with a release to collect biometric information. The bill also provides that a private entity that collects or discloses a person’s biometric identifier or biometric information from the same person more than once is in violation of the act and has committed a single violation for which the aggrieved party is entitled to, at most, one recovery. Status: Pending third reading in the Senate.
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Bill Seeks Investment Opportunities for Nonprofit Corporations
SB 3157 provides that the state treasurer may establish and administer a nonprofit investment pool to enhance investment opportunities for nonprofit corporations in the state. Status: Pending third reading in the Senate.
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Pawnbroker Regulation Act Signed Into Law
Public Act 103-585 establishes requirements to operate as pawnbrokers and imposes restrictions on pawnbrokers and other entities that can potentially act as predatory lenders. The act further establishes a regulatory structure within the IDFPR.
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POLICY & POLITICS
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Update on IDFPR’s Renewal and Payment Policy Email
On March 22, 2024, IDFPR sent an informational email to its 1 million licensees that raised several questions, causing some confusion. In response to the email, the Illinois CPA Society's (ICPAS’) Government Relations team drafted a bulletin update on the matter and coordinated with IDFPR leadership. To clarify the agency's intent, fees submitted for licenses that have been categorized as “refused to renew” will not be refunded.
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Litigation Update on Corporate Transparency Act
On March 1, 2024, the United States District Court for the Northern District of Alabama found the Corporate Transparency Act to be unconstitutional. The Financial Crimes Enforcement Network indicated that the agency won’t be initiating enforcement actions against the plaintiffs/members of the National Small Business United. It’s recommended that CPAs and businesses that are required to report beneficial ownership information (BOI) continue doing so pending final litigation on this issue. See ICPAS’ BOI resource page for more information.
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Illinois General Assembly Honors ICPAS Member Lester H. McKeever Jr.
The Illinois General Assembly awarded ICPAS member Lester H. McKeever Jr. with the 2024 Lincoln Laureate of the Order of Lincoln. The award, which is the highest civilian honor for professional achievement and public service, recognizes McKeever’s contributions to Chicago, the state, and accounting profession.
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Proposed Amendments to Illinois Register Examine Tax Appeals
IDOR proposed amendments to the Illinois Register regarding the Informal Conference Board (ICB) section (86 IAC 215; 48 Ill Reg. 3084). The rulemaking extends the time that must remain on the statute of limitations for a particular tax return from 60 to 180 days before ICB rights will be granted. It also expands ICB jurisdiction to include audit adjustments that result in reductions to net operating losses.
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Applications Now Open for Charitable Trust Grants
State Treasurer Michael W. Frerichs has opened online applications for charitable trust grants. Small nonprofit organizations that provide people with food or housing assistance, and whose annual budgets are $1 million or less, are eligible to apply.
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INSIDE INSIGHT MAGAZINE
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Inflation Reduction Act: Impacting Real Estate Tax Returns
The Inflation Reduction Act of 2022 brought substantial changes to Section 179D Energy-Efficient Commercial Building Tax Deduction, a flagship federal tax incentive. Here’s what to know for this tax season.
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