HomeMy WebLinkAboutOrdinances - ORD-00-1001 - 12/20/2000 - ESTABLISH LOCAL GOVERNMENT TAXPAYERS BILL OF RIGHTORDINANCE NO. oo-iooi
An Ordinance Establishing a Local
Government Taxpayers' Bill of Rights
WHEREAS, the State of Illinois pursuant to the Local Government Taxpayers' Bill of
Rights Act, 50 ILCS 45/ 1 et. seq. , has determined it reasonable and necessary to create the Local
Government Taxpayers' Bill of Rights Act; and
WHEREAS, the Local Government Taxpayers' Bill of Rights Act requires that a
municipality adopt tax processes and procedures to provide all necessary due process rights to a
taxpayer in the collection and enforcement of local tax laws; and
WHEREAS, the City of McHenry, McHenry County, Illinois, (the "City") has determined
it reasonable and necessary to establish certain procedures in regard to locally imposed and
administered taxes.
NOW, THEREFORE, BE IT ORDAINED by the Mayor and Aldermen of the CITY OF
McHENRY, McHenry County, Illinois, as follows:
SECTION 1: This ordinance shall be known as, and may be cited as, the "Locally Imposed
and Administered Tax Rights and Responsibility Ordinance."
SECTION 2: Scope. The provisions of this ordinance shall apply to the City's procedures
in connection with all of the City's locally imposed and administered taxes.
SECTION 3: That the City of McHenry passes the following Local Government
Taxpayers' Bill of Rights, which read as follows:
LOCAL GOVERNMENT TAXPAYERS' BILL OF RIGHTS
A. Definitions. Certain words or terms herein shall have the meaning ascribed to them
as follows:
Act: the Local Government Taxpayers' Bill of Rights Act.
Locally imposed and administered tax or tax: Each tax imposed by the City that is collected or
administered by the City not an agency or department of the State. It does not include any taxes
imposed upon real property under the Property Tax Code or fees collected by the City other than
infrastructure maintenance fees.
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Local tax administrator: The City Administrator, who is charged with the administration and
collection of the locally imposed and administered taxes, including staff, employees or agents to
the extent they are authorized by the local tax administrator to act in the local tax administrator's
stead. The local tax administrator shall have the authority to implement the terms of this
Ordinance to give full effect to this Ordinance. The exercise of such authority by the local tax
administrator shall not be inconsistent with this Ordinance and the Act.
Notice: Each audit notice, collection notice or other similar notice or communication in connection
with each of the City's locally imposed and administered taxes.
Tax Ordinance: Each ordinance passed by the City that imposes any locally imposed and
administered tax.
Taxpayer: Any person required to pay any locally imposed and administered tax and generally
includes the person upon whom the legal incidence of such tax is placed and with respect to
consumer taxes includes the business or entity required to collect and pay the locally imposed and
administered tax to the City.
B. Notices. Unless otherwise provided, whenever notice is required to be given, the
notice is to be in writing mailed 14 prior to the day fixed for any applicable hearing, audit or other
scheduled act of the local tax administrator. The notice shall be sent by the local tax administrator
as follows:
1. First class or express mail, or overnight mail, addressed to the persons
concerned at the persons' last known address, or
2. Personal service or delivery.
C. Late payment. Any notice, payment, remittance or other filing required to be made
to the City pursuant to any tax ordinance shall be considered late unless it is (a) physically
received by the City on or before the due date, or (b) received in an envelope or other container
displaying a valid, readable U.S. Postal Service postmark dated on or before the due date,
properly addressed to the City, with adequate postage prepaid.
D. Payment. Any payment or remittance received for a tax period shall be applied in
the following order: (1) first to the tax due for the applicable period; (2) second to the interest due
for the applicable period; and (3) third to the penalty for the applicable period.
E. Certain Credits and Refunds.
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1. The City shall not refund or credit any taxes voluntarily paid without
written protest at the time of payment in the event that a locally imposed
and administered tax is declared in validly enacted or unconstitutional by
a court of competent jurisdiction. However, a taxpayer shall not be deemed
to have paid the tax voluntarily if the taxpayer lacked knowledge of the
facts upon which to protest the taxes at the time of payment or if the
taxpayer paid the taxes under duress.
2. The statute of limitations on a claim for credit or refund shall be two years
after the end of the calendar year in which payment in error was made. The
City shall not grant a credit or refund of locally imposed and administered
taxes, interest or penalties to a person who has not paid the amounts
directly to the City.
3. The procedure for claiming a credit or refund of locally imposed and
administered taxes, interest or penalties paid in error shall be as follows:
(a) The taxpayer shall submit to the local tax administrator in writing
a claim for credit or refund together with a statement specifying:
(i) the name of the locally imposed and administered tax subject
to the claim;
(ii) the tax period for the locally imposed and administered tax
subject to the claim;
(iii) the date of the tax payment subject to the claim and the
canceled check or receipt for the payment;
(iv) the taxpayer's recalculation, accompanied by an amended or
revised tax return, in connection with the claim; and
(v) a request for either a refund or a credit in connection with
the claim to be applied to the amount of tax, interest and
penalties overpaid, and, as applicable, related interest on the
amount overpaid; provided, however, that there shall be no
refund and only a credit given in the event the taxpayer
owes any monies to the City.
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(b) Within 10 days of the receipt by the local tax administrator of any
claim for a refund or credit, the local tax administrator shall either:
(i) grant the claim; or
(ii) deny the claim, in whole or in part, together with a state-
ment as to the reason for the denial or the partial grant and
denial.
(c) In the event the local tax administrator grants, in whole or in part,
a claim for refund or credit, the amount of the grant for refund or
credit shall bear interest at the rate of five percent per annum, based
on a year of 365 days and the number of days elapsed, from the
date of the overpayment to the date of mailing of a refund check or
the grant of a credit.
F. Audit Procedure. Any request for proposed audit pursuant to any local
administered tax shall comply with the notice requirements of this Ordinance.
Each notice of audit shall contain the following information:
a. the tax;
b. the time period of the audit; and
C. a brief description of the books and records to be made available for
the auditor.
2. Any audit shall be conducted during normal business hours and if the date
and time selected by the local tax administrator is not agreeable to the
taxpayer, another date and time may be requested by the taxpayer within
30 days after the originally designated audit and during normal business
hours.
3. The taxpayer may request an extension of time to have an audit conducted.
The audit shall be conducted not less than seven days nor more than 30
days from the date the notice is given, unless the taxpayer and the local tax
administrator agreed to some other convenient time. In the event taxpayer
is unable to comply with the audit on the date in question, the taxpayer may
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request another date within the 30 days, approved in writing, that is
convenient to the taxpayer and the local tax administrator.
4. Every taxpayer shall keep accurate books and records of the taxpayer's
business or activities, including original source documents and books of
entry denoting the transactions which had given rise or may have given rise
to any tax liability, exemption or deduction. All books shall be kept in the
English language and shall be subject to and available for inspection by the
City.
5. It is the duty and responsibility of every taxpayer to make available its
books and records for inspection by the City. If the taxpayer fails to
provide the documents necessary for audit within the time provided, the
local tax administrator may issue a tax determination and assessment based
on the tax administrator's determination of the best estimate of the
taxpayer's tax liability.
6. If an audit determines there has been an overpayment of a locally imposed
and administered tax as a result of the audit, written notice of the amount
of overpayment shall be given to the taxpayer within 30 days of the City's
determination of the amount of overpayment.
7. In the event a tax payment was submitted to the incorrect local governmen-
tal entity, the local tax administrator shall notify the local governmental
entity imposing such tax.
G. Anneal.
The local tax administrator shall send written notice to a taxpayer upon the
local tax administrator's issuance of a protestable notice of tax due, a bill,
a claim denial or a notice of claim reduction regarding any tax. The notice
shall include the following information:
a. the reason for the assessment;
b. the amount of the tax liability proposed;
C. the procedure for appealing the assessment; and
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d. the obligations of the City during the audit, appeal, refund and
collection process.
2. A taxpayer who receives written notice from the local tax administrator of
a determination of tax due or assessment may file with the local tax
administrator a written protest and petition for hearing, setting forth the
basis of the taxpayer's request for a hearing. The written protest and
petition for hearing must be filed with the local tax administrator within 45
days of receipt of the written notice of the tax determination and assess-
ment.
3. If a timely written notice and petition for hearing is filed, the local tax
administrator shall fix the time and place for hearing and shall give written
notice to the taxpayer. The hearing shall be scheduled for a date within 14
days of receipt of the written protest and petition for hearing, unless the
taxpayer requests a later date convenient to all parties.
4. If a written protest and petition for hearing is not filed within the 45 day
period, the tax determination, audit or assessment shall become a final bill
due and owing without further notice.
5. Upon the showing of reasonable cause by the taxpayer and the full payment
of the contested tax liability along with interest accrued as of the due date
of the tax, the local tax administrator may reopen or extend the time for
filing a written protest and petition for hearing. In no event shall the time
for filing a written protest and petition for hearing be reopened or extended
for more than 90 days after the expiration of the 45 day period.
H. Hearina.
1. Whenever a taxpayer or a tax collector has filed a timely written protest and
petition for hearing under section nine, above, the local tax administrator
shall conduct a hearing regarding any appeal.
2. No continuances shall be granted except in cases where a continuance is
absolutely necessary to protect the rights of the taxpayer. Lack of
preparation shall not be grounds for a continuance. Any continuance
granted shall not exceed 14 days.
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3. At the hearing the local tax administrator shall preside and shall hear
testimony and accept any evidence relevant to the tax determination, audit
or assessment. The strict rules of evidence applicable to judicial proceed-
ings shall not apply.
4. At the conclusion of the hearing, the local tax administrator shall make a
written determination on the basis of the evidence presented at the hearing.
The taxpayer or tax collector shall be provided with a copy of the written
decision.
I. Interest and Penalties. In the event a determination has been made that a tax is due
and owing, through audit, assessment or other bill sent, the tax must be paid within the time frame
otherwise indicated.
1. Interest. The City hereby provides for the amount of interest to be assessed
on a late payment, underpayment, or nonpayment of the tax, to be five
percent per annum, based on a year of 365 days and the number of days
elapsed.
2. Late Filing and Payment Penalties. If a tax return is not filed within the
time and manner provided by the controlling tax ordinance, a late filing
penalty, of five percent of the amount of tax required to be shown as due
on a return shall be imposed; and a late payment penalty of five percent of
the tax due shall be imposed. If no return is filed within the time or manner
provided by the controlling tax ordinance and prior to the City issuing a
notice of tax delinquency or notice of tax liability, then a failure to file
penalty shall be assessed equal to 25 percent of the total tax due for the
applicable reporting period for which the return was required to be filed.
A late filing or payment penalty shall not apply if a failure to file penalty
is imposed by the controlling ordinance.
J. Abatement. The local tax administrator shall have the authority to waive or abate
any late filing penalty, late payment penalty or failure to file penalty if the local tax administrator
shall determine reasonable cause exists for delay or failure to make a filing.
K. Installment Contracts. The City may enter into an installment contract with the
taxpayer for the payment of taxes under the controlling tax ordinance. The local tax administrator
may not cancel any installment contract so entered unless the taxpayer fails to pay any amount due
and owing. Upon written notice by the local tax administrator that the payment is 30 days
delinquent, the taxpayer shall have 14 working days to cure any delinquency. If the taxpayer fails
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to cure the delinquency within the 14 day period or fails to demonstrate good faith in restructuring
the installment contract with the local administrator, the installment contract shall be canceled
without further notice to the taxpayer.
L. Statute of Limitations. The City, through the local tax administrator, shall review
all tax returns in a prompt and timely manner and inform taxpayers of any amounts due and
owing. The taxpayer shall have 45 days after receiving notice of the reviewed tax returns to make
any request for refund or provide any tax still due and owing.
1. No determination of tax due and owing may be issued more than four years
after the end of the calendar year for which the return for the applicable
period was filed or for the calendar year in which the return for the
applicable period was due, whichever occurs later.
2. If any tax return is not filed or if during any 4-year period for which a
notice of tax determination or assessment may be issued by the City, the tax
paid was less than 75 percent of the tax due, the statute of limitations shall
be six years maximum after the end of the calendar year in which return for
the applicable period was due or end of the calendar year in which the
return for the applicable period was filed.
3. No statute of limitations shall not apply if a fraudulent tax return was filed
by the taxpayer.
M. VoluntaU Disclosure. For any locally imposed and administered tax for which a
taxpayer has not received a written notice of an audit, investigation or assessment from the local
tax administrator, a taxpayer is entitled to file an application with the local tax administrator for
a voluntary disclosure of the tax due. A taxpayer filing a voluntary disclosure application must
agree to pay the amount of tax due, along with interest of one percent per month; for all periods
prior to the filing of the application but not more than four years before the date of filing the
application. A taxpayer filing a valid voluntary disclosure application may not be liable for any
additional tax, interest or penalty for any period before the date the application was filed.
However, if the taxpayer incorrectly determined and underpaid the amount of tax due, the
taxpayer is liable for the underpaid tax along with applicable interest on the underpaid tax, unless
the underpayment was the result of fraud on the part of the taxpayer, in which case the application
shall be deemed invalid and void. The payment of tax and interest must be made by no later than
90 days after the filing of the voluntary disclosure application or the date agreed to by the local
tax administrator. However, any additional amounts owed as a result of an underpayment of tax
and interest previously paid under this Ordinance must be paid within 90 days after a final
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determination and the exhaustion of all appeals of the additional amount owed or the date agreed
to by the local tax administrator, whichever is longer.
N. Publication of Tax Ordinances. Any locally administered tax ordinance shall be
published via normal or standard publishing requirements. The posting of a tax ordinance on the
Internet shall satisfy the publication requirements. Copies of all tax ordinances shall be made
available to the public upon request at the City Clerk's office.
O. Internal Review Procedure. The local tax administrator shall establish an internal
review procedure regarding any liens filed against any taxpayers for unpaid taxes. Upon a
determination by the local tax administrator that the lien is valid, the lien shall remain in full force
and effect. If the lien is determined to be improper, the local tax administrator shall:
1. timely remove the lien at the City's expense;
2. correct the taxpayer's credit record; and
3. correct any public disclosure of the improperly imposed lien.
P. Application: This Ordinance shall be liberally construed and administered to
supplement all of the City's tax ordinances. To the extent that any tax ordinance is in conflict with
or inconsistent with this Ordinance, this Ordinance shall be controlling.
SECTION 4: If any section, paragraph, subdivision, clause, sentence or provision of this
Ordinance shall be adjudged by any Court of competent jurisdiction to be invalid, such judgment
shall not affect, impair, invalidate or nullify the remainder thereof, which remainder shall remain
and continue in full force and effect.
SECTION 5: All ordinances or parts of ordinances in conflict herewith are hereby
repealed to the extent of such conflict.
SECTION 6: This Ordinance shall be in full force and effect upon its passage, approval
and publication in pamphlet form (which publication is hereby authorized) as provided by law.
SECTION 2: If any section, paragraph, subdivision, clause, sentence or provision of this
Ordinance shall be adjudged by any Court of competent jurisdiction to be invalid, such judgment
shall not affect, impair, invalidate or nullify the remainder thereof, which remainder shall remain
and continue in full force and effect.
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SECTION 3: All ordinances or parts of ordinances in conflict herewith are hereby
repealed to the extent of such conflict.
SECTION 4: This Ordinance shall be in full force and effect upon its passage, approval
and publication in pamphlet form (which publication is hereby authorized) as provided by law.
Voting Aye: Bolger, Glab, McClatchey, Murgatroyd, Baird
Voting Nay: None
Absent: None
Abstain: None
APPROVED:
s
Mayor Steven J. Cuda
(SEAL)
ATTI31Q
CityCler�PelL�It��
Passed: December 20, 2000
Approved: December 20. 2000
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