a) General
Requirements
Every operator shall keep separate books or records of
his or her business as an operator so as to show the rents and occupancies
taxable under the Hotel Operators' Occupation Tax Act
separately from his or her transactions that are not
taxable under that Act. If any such operator fails to keep
separate books or records, he or she shall be liable to tax at the rate
designated in Section 3 of the Hotel Operators' Occupation Tax Act
upon the entire proceeds from his hotel.
b) Preservation and Retention of Records
1) Books and records and other papers
reflecting gross receipts received during any period with respect to which the
Department is authorized to issue proposed assessments as provided by the Act
shall be preserved until the expiration of that period unless the Department,
in writing, shall authorize their destruction or disposal prior to that
expiration. (See 86 Ill. Adm. Code
130.825.)
2) In determining the period for which the
Department is authorized to issue a proposed assessment, the following material
(with necessary adaptations because of the time when the Hotel Operators'
Occupation Tax became effective) from Sections 4 and 5 of the Retailers'
Occupation Tax Act [ 35 ILCS 120 ] (which are incorporated by reference into
Section 7 of the Hotel Operators' Occupation Tax Act) must be
considered.
3) Except in case of
willful failure or refusal to file a return, or except in case of a fraudulent
return, or except with the consent of the person to whom the proposed
assessment is to be issued, no proposed assessment shall be issued on and after
each January 1 and July 1 covering gross receipts received during any month or
period of time more than 3 years prior to that January 1 and July 1,
respectively:
A) Provided, however, that:
i) the foregoing limitations upon the
issuance of a proposed assessment shall not apply to the issuance of a proposed
assessment with respect to any prior period of time in cases in which the
Department has, within the period of limitation then provided, notified the
person making the return of a proposed assessment even though that return had
not been corrected by the Department in the manner required by the Act prior to
the issuance of the notice; and
ii)
the foregoing limitations upon the issuance of a proposed assessment shall not
apply to the issuance of any such assessment with respect to any prior period
of time prior in cases in which the Department has, within the period of
limitation then provided, notified a person of the amount of tax computed even
though the Department had not determined the amount of tax due from that person
in the manner required by the Act prior to the issuance of the notice; but in
no case shall the amount of any such proposed assessment for any period
otherwise barred by the Act exceed for that period the amount shown in the
Notice of Proposed Assessment.
B) If, when a tax or penalty under the Act
becomes due and payable, the person alleged to be liable is out of the State,
the proposed assessment may be issued, within the times limited by the Act,
after that person enters or returns to the State; and if, after the tax or
penalty under the Act becomes due and payable, the person alleged to be liable
departs from and remains out of the State, the time of that person's absence is
no part of the time limited for the issuance of the proposed assessment; but
these provisions concerning absence from the State shall not apply to any case
in which, at the time a tax or penalty becomes due under the Act, the person
allegedly liable is not a resident of this State.
c) Preservation of Books During
Pendency of Assessment Proceedings However, if a Notice of Proposed Assessment
has been issued, and if the questions raised by that Notice have not been
completely disposed of, books and records reflecting receipts received during
the period covered by the proposed assessment must be preserved until the
termination of all proceedings before the Department and before any court upon
review.
d) Department
Authorization to Destroy Records Sooner than Would Otherwise be Permissible
In all cases, the Department may, in writing, authorize the
destruction of books and records and other papers prior to the expiration of
the periods of time during which the taxpayer, except for the written
authorization from the Department, is required to keep the books and
records.
