Providing Benefits to Taxpayers

The Illinois Department of Revenue recently implemented a taxpayer-friendly rule that now allows taxpayers to apply overpayments reported on amended tax returns against their estimated tax obligations for a subsequent taxable year, rather than having to claim refunds for the overpayments. Under prior rules, taxpayers who claimed refunds sometimes had to wait years for the refunds because the income tax refund fund was underfunded. Yet, taxpayers still had to pay taxes in subsequent years because the election to apply an overpayment against future taxes could be made only on a timely-filed original return. Under the new regulation, taxpayers will not have to wait for refunds but can instead elect to apply their overpayments against future liabilities.