Illinois Administrative Code › Title 86 - REVENUE › Part 100 - INCOME TAX › Subpart AA - DEFICIENCIES AND OVERPAYMENTS › Section 100.9300 - Deficiencies and Overpayments (IITA Section 904)

Current through Register Vol. 48, No. 28, July 12, 2024
a) Examination of return
The Department shall examine a return as soon as practicable
				  after it is filed to determine the correct amount of tax. If for reasons other
				  than mathematical error (see Section
				  100.9200(a)(1)
				   of this Part) the Department finds that the
				  correct amount of tax exceeds that shown on the return, and the taxpayer
				  disagrees, the Department then shall issue to the taxpayer, subject to
				  applicable limitations in IITA Section 905 (see Section 100.9230 of this Part),
				  a notice of deficiency which shall set forth the amount of tax and any
				  penalties proposed to be assessed. (See IITA Section 904(c).) Note that, in the
				  absence of a written protest of the notice so issued (see 86 Ill. Adm. Code
				  200.120(b)
				  ), the Department's final action thereunder is not an administrative decision
				  subject to judicial review (except as to jurisdictional questions) under the
				  provisions of the Administrative Review Act (see Section
				  100.9600
				  of this Part). If the Department finds that the tax paid exceeds the correct
				  amount, it shall credit or refund the overpayment as provided by IITA Section
				  909. The Department's findings under this subsection (a) shall be deemed prima
				  facie correct and shall constitute prima facie evidence of the correctness of
				  the amount of tax and penalties due.
b) No return filed
If any taxpayer fails to file a return required by the Act,
				  the Department under its authority for access to books and records and to
				  conduct examinations, investigations, and hearings provided in IITA Sections
				  913 through 916, using any reasonable method in accordance with its best
				  judgment and information, shall determine the correct amount of tax due and
				  without any time limitation (see IITA Section 905(c)) shall issue to the
				  taxpayer a notice of deficiency setting forth the amount of tax and penalties
				  proposed to be assessed. The term "reasonable method", for example, shall
				  include any method or combination of methods to reconstruct the taxpayer's
				  Illinois net income established or acceptable under federal
				  26 USC
				  446, e.g., methods based in whole or part on
				  cash register receipts, specific items of income or expense, bank deposits,
				  expenditures (including use of the rule in Cohan v. Commissioner, 39 F. 2d 540
				  (2d Cir.), to determine the amounts of allowable expenses), net worth, or other
				  acceptable or accepted method. (In this connection see also Section
				  100.9200(a)(4)
				   of this Part.) The Department's
				  determination shall be deemed prima facie correct and shall constitute prima
				  facie evidence of the correctness of the amount of tax due.
c) Notice of deficiency
A notice of deficiency issued under the Act shall set forth
				  the reasons therefor and a basis sufficient to inform the taxpayer of the
				  adjustments giving rise to the proposed assessment. In case a joint return was
				  filed, the Department may issue a single joint notice of deficiency to the
				  taxpayers unless it has been notified by either of the spouses that separate
				  residences have been established in which case it shall issue the joint notice
				  of deficiency to each spouse.
d) Assessment when no protest
The amount of tax and penalties specified in a notice of
				  deficiency shall be deemed assessed upon the expiration of 60 days (150 days if
				  the taxpayer is outside the United States) from the date of issuance to the
				  taxpayer except only for such amounts as to which the taxpayer shall have filed
				  a protest as provided in IITA Section 908. (See 86 Ill. Adm. Code
				  200.120(b).)