Appeal from the Circuit Court of Cook County. 09 L 051411 Honorable James C. Murray, Jr., Judge Presiding.
The opinion of the court was delivered by: Justice Neville
JUSTICE NEVILLE delivered the judgment of the court, with opinion. Justices Murphy and Salone concurred in the judgment and opinion.
¶ 1 In 2003, the Illinois legislature passed the 2003 Tax Delinquency Amnesty Act (2003 Amnesty Act) and provided amnesty to taxpayers who paid all taxes owed for any taxable period after June 30, 1983 and prior to July 1, 2002. 35 ILCS 745/10 (West 2008). The legislature also prescribed a 200% interest penalty for those taxpayers that failed to pay all taxes due during the amnesty period which ran from October 1, 2003 through November 15, 2003. Marriott International (Marriott) paid federal and state taxes for the years 2000 through 2002, but the Internal Revenue Service (IRS) conducted an audit, commenced in 2004 and concluded in 2007, which determined that Marriott had understated its taxable income and failed to pay all its taxes. After the IRS audit, Marriott filed an amended Illinois income tax return in 2007 for the years 2000 through 2002, and paid the unpaid taxes for those years.
¶ 2 The Illinois Department of Revenue (Department) determined that Marriott's tax liability for the years 2000 and 2001 was eligible for payment during the 2003 amnesty period and, therefore, assessed a 200% interest penalty for taxes due but unpaid during the amnesty period. Marriott paid the penalty under protest and filed a complaint against the Department, Brian Hamer, the Director of the Department, and Alexi Giannoulais, Treasurer of the State of Illinois*fn1 (collectively, the defendants), to recover the additional interest assessed by the Department that it paid under protest. The trial court granted Marriott's motion for partial summary judgment and held that the double interest provision in section 3-2(f) of the Unified Penalty and Interest Act (Penalty Act) (35 ILCS 735/3-2(f)(West 2008)) did not apply to its tax liability because Marriott paid all the taxes that it reported on its tax returns for the years 2000 and 2001, and because Marriott did not know of its additional tax liability during the amnesty period.
¶ 3 We find that Marriott's state tax liability for the years 2000 and 2001 was eligible for amnesty because the tax returns for those years became due to be filed on dates during the taxable period (June 30, 1983 and prior to July 1, 2002) covered by the 2003 Amnesty Act. Therefore, we hold that Marriott's tax liability for the years 2000 and 2001 was subject to the double interest provision in section 3-2(f) of the Penalty Act because Marriott did not pay "all taxes due" during the amnesty period. Accordingly, we reverse the judgment of the trial court.
¶ 5 In 2003, the Illinois legislature enacted the Amnesty Act in an attempt to generate revenue for the state and remedy an ongoing financial crisis. Pub. Act 93-26 §10 (eff. June 20, 2003).
¶ 6 The 2003 Amnesty Act provided in pertinent part as follows:
"The Department shall establish an amnesty program for all taxpayers owing any tax imposed by reason of or pursuant to authorization by any law of the State of Illinois and collected by the Department.
The amnesty program shall be for a period from October 1, 2003 through November 15, 2003.
The amnesty program shall provide that, upon payment by a taxpayer of all taxes due from that taxpayer to the State of Illinois for any taxable period ending after June 30, 1983 and prior to July 1, 2002, the Department shall abate and not seek to collect any interest or penalties that may be applicable ***. Failure to pay all taxes due to the State for a taxable period shall invalidate any amnesty granted under this Act. Amnesty shall be granted only if all amnesty conditions are satisfied by the taxpayer." 35 ILCS 745/10 (West 2008).
¶ 7 The legislature also amended section 3-2 of the Penalty Act to provide a penalty for those taxpayers that had a tax liability that was eligible for amnesty but failed to pay the taxes during the amnesty period. Section 3-2(f) of the Penalty Act provided:
"(f) If a taxpayer has a tax liability that is eligible for amnesty under the Tax Delinquency Amnesty Act and the taxpayer fails to satisfy the tax liability during the amnesty period provided for in that Act, then the interest charged by the Department under this Section shall be imposed at a rate that is 200% of the rate that would be imposed under this Section."
35 ILCS 735/3-2(f) (West 2008).
¶ 8 Pursuant to authority granted under the 2003 Amnesty Act, the Department promulgated a set of emergency regulations. Section 521.105(j) of the ...