Penalties and Interest for Illinois Taxes
PUB-103 (R-10/19, R-07/20 Back reformatted)
Page 3 of 13
General Information
Definitions
Processable return
For a return to be considered “processable,” it must
be signed by the person authorized by law to sign it,
be in a format we have prescribed or approved, and
contain all information, schedules, and supporting
documents necessary to determine the correct tax and
to make allocations.
Due dates
“Due dates” for payments and filing returns mentioned in this
publication are referred to as “original due date” and “extended
return due date.”
Original due date — This is the date the payment or
return is due without regard to extensions. Due dates
differ depending on the tax type. The due dates for each
tax type can be found in the instructions for the corre-
sponding tax type.
Extended return due date (income tax only, except
withholding tax) — Illinois Income Tax law provides for an
automatic “extended due date” for filing only. All tax must
be paid by the original due date even if the return has not
been filed.
In some cases, the Internal Revenue Service (IRS) gives an
additional extension of time to file income or withholding tax
returns. If the IRS grants you this extension, we will grant
you the same extension.
Tax shown due
This is the amount of tax you actually report on an original or
amended return.
Tax required to be shown due
This is the tax amount that is required to be shown due on an is required to be shown due on an
original or amended return. original or amended return.
Unadmitted liability
Tax found due that a taxpayer does not admit to owing.
Trust tax
A trust tax is a tax you are required to collect from your employee
or customer and remit to us, e.g., sales or withholding taxes.
Amnesty
The Illinois Tax Delinquency Amnesty Act has provided three
opportunities for taxpayers to pay outstanding tax liabilities
and to have eligible penalties and interest for taxes paid
during an amnesty period waived.
1) For periods ending after June 30, 1983, and prior to
July 1, 2002 — If your liability qualified for amnesty and
you did not pay that liability during the amnesty period
held October 1, 2003, through November 17, 2003, your
penalty and interest amounts may be doubled.
2) For periods ending after June 30, 2002, and prior to
July 1, 2009 — If your liability qualified for amnesty and
you did not pay that liability during the amnesty period
held October 1, 2010, through November 8, 2010, your
penalties and interest amounts may be doubled.
3) For periods ending after June 30, 2011, and prior to
July 1, 2018 — If your liability qualified for amnesty and
you did not pay that liability during the amnesty period
held October 1, 2019, through November 15, 2019, your
penalty and interest amounts will not be waived.
What penalties can be assessed?
If you do not file your return, pay your tax on time, fail to
provide correct information by the date requested, or do not
file a “processable” return, you may be assessed penalties.
Reference “What are the most common penalties and when
do they apply?”
How is interest calculated?
On January 1, 1994, a uniform interest rate was created.
This allows us to charge interest on underpayments and pay to charge interest on underpayments and pay
interest on overpaymentsinterest on overpayments at the same rate for most taxes we
administer. Interest is simple interest figured using a daily
rate. The rate is reviewed twice each year — on January 1
and July 1 — and adjusted according to the “underpayment
rate” or the “short term rate” established under the Internal
Revenue Code (IRC Section 6621).
Prior to January 1, 2004, the rate of interest payable on
overpayments and charged on charged on underpayments was the
“underpayment rate.” During the period from January 1, 2004,
through December 31, 2013, interest accrued at the “short
term federal rate” for the first year that the overpayment or
underpayment accrued interest. This is 3 percent less than
the “underpayment rate.” After one year, interest would accrue
on any remaining balance at the “underpayment rate.” Interest
accruing after December 31, 2013, on an overpayment or
underpayment accrues at the “underpayment rate,” regardless
when the overpayment or underpayment arose. The following
formula is used to calculate interest
tax (+ penalty, if applicable) due x interest rate ÷ 365 =
daily interest amount x number of days = total interest due.
Interest charged to you: Interest begins to accrue the day after
the date the payment is due through the date you pay the tax.
Interest paid by us: Unless an overpayment is refunded or
a credit is approved within 90 days after the return due date,
interest will be paid to you from the due date of the original
return, the date a processable return is filed, or the date of
overpayment (whichever date is latest).
Returns due on or after January 1, 2001: Interest is no
longer charged on penalties.
Interest is calculated using 366 days during leap years.