a) Verified
credit. A verified credit is a specific type of credit arising under Section 3
of the Retailers' Occupation Tax Act, which states:
If any payment provided for in this Section exceeds the
taxpayer's liabilities under this Act, the use Tax Act, the Service Occupation
Tax Act and the Service Use Tax Act, as shown on an original monthly return,
the Department shall, if requested by the taxpayer, issue to the taxpayer a
credit memorandum no later than 30 days after the date of payment. The credit
evidenced by such credit memorandum may be assigned by the taxpayer to a
similar taxpayer under this Act, the Use Tax Act, the Service Occupation Tax
Act or the Service Use Tax Act, in accordance with reasonable rules and
regulations to be prescribed by the Department. If no such request is made, the
taxpayer may credit such excess payment against tax liability subsequently to
be remitted to the Department under this Act, the Use Tax Act, the Service
Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable
rules and regulations prescribed by the Department. If the Department
subsequently determined that all or any part of the credit taken was not
actually due to the taxpayer, the taxpayer's 2.1 % and 1.75 % vendor's discount
shall be reduced by 2.1% or 1.75% of the difference between the credit taken
and that actually due, and that taxpayer shall be liable for penalties and
interest on such difference. [35 ILCS 120/3
]
b) Verified credit -
explanation - no interest paid. A verified credit is an amount of tax overpaid
in a prior period that may be rolled over and applied to subsequent tax
liabilities without the need to comply with the formalities involved in
submitting a claim for credit. Since the taxpayer has the immediate use of the
verified credit to apply against its liability without the need to file a claim
for credit and prove the overpayment, interest is not paid on verified credits
(See also, 86 Ill. Adm. Code
700.230(a)(2)).
Verified credits appear on a Taxpayer Statement listing a taxpayer's unpaid
balance, available credits or returns not filed.
c) Verified credit - How used. A verified
credit may be used by a taxpayer in only 3 ways:
1) It can be used to offset liability of the
taxpayer that arises under this Act, the Service Occupation Tax Act, the
Retailers' Occupation Tax Act or the Use Tax Act, subsequent to the origination
of the verified credit;
2) It can
be converted to a credit memorandum no later than 30 days after the date of
overpayment, by making a request made to the Department using forms prescribed
by the Department and available at
www.tax.illinois.gov. See
35 ILCS
120/6a, for information to be included. Interest is
not paid on verified credits that are converted to credit memoranda in
accordance with this subsection (c)(2); and
3) It can be converted to a credit memorandum
at any time, starting 30 days after the date of overpayment, by making a
request to the Department using forms prescribed by the Department and
available at
www.tax.illinois.gov,
and without regard to the limitations on claims for refund. See also 86 Ill.
Adm. Code
160.150 for information on
limitations and procedures. Interest is not paid on verified credits that are
converted to credit memoranda in accordance with this subsection
(c)(3).
d) A verified
credit that is converted to a credit memorandum under this subsection (d) may
be assigned to another taxpayer in the same manner as other credit memoranda
issued to taxpayers by the Department.
