Illinois Department of Revenue

Publication 103 

Penalties and Interest for Illinois Taxes

 The information in this publication is     About this publication
 current as of the date of the publication. 
 Please visit our website at                The purpose of this publication is to explain penalties and interest assessed on returns 
                                            due on or after January 1, 1994. If you need penalty or interest information for earlier 
 tax.illinois.gov to verify you have the 
                                            liabilities, see the appropriate tax act. The objectives of this publication are to
 most current revision.
                                              answer general questions about penalty and interest,
 This publication is written in the plain     identify and define each penalty,
 English style so the tax information is      explain how each penalty is calculated and assessed, 
 easier to understand. As a result, we        explain how interest is calculated, and
 do not directly quote Illinois statutes 
                                              provide penalty and interest rates.
 or the Illinois Administrative Code. 
 The contents of this publication are 
 informational only and do not take         We encourage you to let us calculate your penalties and interest and bill you. However, 
 the place of statutes, rules, and court    if you annualize your income to compute your estimated income tax installments, you 
 decisions.                                 must complete and attach to your return Form IL-2210, Computation of Penalties for 
                                            Individuals, or Form IL-2220, Computation of Penalties for Businesses, to show when 
                                            your income was earned.
  For information or forms
                                            This publication does not cover penalties and interest assessed through the Racing 
   Visit our website at tax.illinois.gov    Privilege Tax Act, the Property Tax Code, or the Real Estate Transfer Tax Act. For 
   Call 1 800 732-8866 or 217 782-3336      information on these taxes, see the appropriate tax acts.
   Call our TDD (telecommunications  
    device for the deaf) at 1 800 544-5304

 Taxpayer Bill of Rights
 You have the right to call the Department of Revenue for help in resolving tax problems.
 You have the right to privacy and confidentiality under most tax laws.
 You have the right to respond, within specified time periods, to Department notices by asking questions, paying the 
 amount due, or providing proof to refute the Department’s findings.
 You have the right to appeal Department decisions, in many instances, within specified time periods, by asking for 
 Department review, by filing a petition with the Illinois Independent Tax Tribunal, or by filing a complaint in circuit court.
 If you have overpaid your taxes, you have the right, within specified time periods, to file for a credit (or, in some cases, 
 a refund) of that overpayment.
 For more information about these rights and other Department procedures, you may write us at the following address:
 Problems Resolution Office
 Illinois Department of Revenue
 PO Box 19014
 Springfield, IL  62794-9014

Get Illinois Department of Revenue forms and information at tax.illinois.gov

Penalties and Interest for Illinois Taxes

Contents

General Information
 Definitions .............................................................................................................................................3
             Processable return ......................................................................................................................3
             Due dates ....................................................................................................................................3
             Tax shown due .............................................................................................................................3
             Tax required to be shown due......................................................................................................3
             Unadmitted liability ......................................................................................................................3
             Trust tax .......................................................................................................................................3
             Amnesty .......................................................................................................................................3
 What penalties can be assessed? ........................................................................................................3
 How is interest calculated? ...................................................................................................................3

Penalty Information
 What are the most common penalties and when do they apply? ........................................................ 4
             Late-filing (or nonfiling) penalty .................................................................................................. 4
             Late-filing (or nonfiling) penalty for transaction return ................................................................ 4
             Late-payment penalty ................................................................................................................. 4
             Bad check penalty ...................................................................................................................... 4
             Cost of collection fee .................................................................................................................. 4
             Failure to file correct information return penalty ......................................................................... 4
             Fraud penalty .............................................................................................................................. 4 
             Frivolous return penalty .............................................................................................................. 4
             Negligence penalty ..................................................................................................................... 5
             Personal liability penalty ............................................................................................................. 5
 What are the penalties for abusive tax avoidance transactions (abusive tax shelters)? ..................... 5
             Participant penalties ................................................................................................................... 5
             Material advisor penalties ........................................................................................................... 5
 What if I believe I have a good reason for penalty abatement? ........................................................... 5

Penalty Rates ......................................................................................................................... 6 through 11 

Penalties for Tax Avoidance Transactions .............................................................................. 12 

Interest Rates    ........................................................................................................................................13

Office locations and phone numbers  .................................................................................. Back

Page 2 of 13                             PUB-103 (R-10/19, R-06/22 back page updated)

                                                                                                                      Penalties and Interest for Illinois Taxes

General Information

Definitions                                                                                     2)   For periods ending after June 30, 2002, and prior to 
                                                                                                 July 1, 2009 — If your liability qualified for amnesty and 
Processable return                                                                               you did not pay that liability during the amnesty period 
For a return to be considered “processable,” it must                                             held October 1, 2010, through November 8, 2010, your 
      be signed by the person authorized by law to sign it,                                      penalties and interest amounts may be doubled.
      be in a format we have prescribed or approved, and                                        3)   For periods ending after June 30, 2011, and prior to 
      contain all information, schedules, and supporting                                         July 1, 2018 — If your liability qualified for amnesty and 
        documents necessary to determine the correct tax and                                     you did not pay that liability during the amnesty period 
        to make allocations.                                                                     held October 1, 2019, through November 15, 2019, your 
                                                                                                 penalty and interest amounts will not be waived.
Due dates 
“Due dates” for payments and filing returns mentioned in this                                   What penalties can be assessed?
publication are referred to as “original due date” and “extended                                If you do not file your return, pay your tax on time, fail to 
return due date.”                                                                               provide correct information by the date requested, or do not 
  Original due date — This is the date the payment or                                           file a “processable” return, you may be assessed penalties. 
  return is due without regard to extensions. Due dates                                         Reference “What are the most common penalties and when 
  differ depending on the tax type. The due dates for each                                      do they apply?” 
  tax type can be found in the instructions for the corre-
  sponding tax type.                                                                            How is interest calculated?
                                                                                                On January 1, 1994, a uniform interest rate was created. 
  Extended return due date (income tax only, except 
                                                                                                This allows us to charge interest on underpayments and pay to charge interest on underpayments and pay 
  withholding tax) — Illinois Income Tax law provides for an 
                                                                                                interestinterest onon overpaymentsoverpaymentsat the same rate for most taxes we 
  automatic “extended due date” for filing only. All tax must 
                                                                                                administer. Interest is simple interest figured using a daily 
  be paid by the original due date even if the return has not 
                                                                                                rate. The rate is reviewed twice each year — on January 1 
  been filed.
                                                                                                and July 1 — and adjusted according to the “underpayment 
  In some cases, the Internal Revenue Service (IRS) gives an                                    rate” or the “short term rate” established under the Internal 
  additional extension of time to file income or withholding tax                                Revenue Code (IRC Section 6621). 
  returns. If the IRS grants you this extension, we will grant                                   
  you the same extension.                                                                       Prior to January 1, 2004, the rate of interest payable on 
                                                                                                overpayments and charged on charged on underpayments was the 
Tax shown due                                                                                   “underpayment rate.” During the period from January 1, 2004, 
This is the amount of tax you actually report on an original or                                 through December 31, 2013, interest accrued at the  “short 
amended return.                                                                                 term federal rate” for the first year that the overpayment or 
                                                                                                underpayment accrued interest. This is 3 percent less than 
Tax required to be shown due 
                                                                                                the “underpayment rate.” After one year, interest would accrue 
This is the tax amount that is required to be shown due on an is required to be shown due on an on any remaining balance at the “underpayment rate.” Interest 
original or amended return. original or amended return.                                         accruing after December 31, 2013, on an overpayment or 
Unadmitted liability                                                                            underpayment accrues at the “underpayment rate,” regardless 
Tax found due that a taxpayer does not admit to owing.                                          when the overpayment or underpayment arose. The  following 
                                                                                                formula is used to calculate interest
Trust tax 
                                                                                                 tax (+ penalty, if applicable) due x interest rate ÷ 365 = 
A trust tax is a tax you are required to collect from your employee                              daily interest amount x number of days = total interest due.
or customer and remit to us, e.g., sales or withholding taxes.
                                                                                                Interest charged to you: Interest begins to accrue the day after 
Amnesty                                                                                         the date the payment is due through the date you pay the tax.
The Illinois Tax Delinquency Amnesty Act has provided three 
opportunities for taxpayers to pay outstanding tax liabilities                                  Interest paid by us: Unless an overpayment is refunded or 
and to have eligible penalties and interest for taxes paid                                      a credit is approved within 90 days after the return due date, 
during an amnesty period waived.                                                                interest will be paid to you from the due date of the original 
                                                                                                return, the date a processable return is filed, or the date of 
1)  For periods ending after June 30, 1983, and prior to                                        overpayment (whichever date is latest).
    July 1, 2002 — If your liability qualified for amnesty and  
                                                                                                Returns due on or after January 1, 2001: Interest is no 
    you did not pay that liability during the amnesty period 
                                                                                                longer charged on penalties.
    held October 1, 2003, through November 17, 2003, your 
    penalty and interest amounts may be doubled.                                                  Interest is calculated using 366 days during leap years. 
PUB-103 (R-10/19, R-07/20 Back reformatted)                                                                                                                        Page 3 of 13

Penalties and Interest for Illinois Taxes

Penalty Information

What are the most common penalties                                    Additional liability due 
and when do they apply?                                              In general, this penalty is assessed on changes made due 
                                                                     to audit functions and on unadmitted liabilities.
Late-filing (or nonfiling) penalty                                   You owe this penalty if
You owe this penalty if                                                      the amount of tax shown on the return is less       
     you do not file a return by the due date, including any                than the correct amount of tax due, and you fail    
      extended due date; or                                                 to pay the full amount due within 30 days of the    
                                                                            date we send you a notice and demand, a notice of  
     you timely file a return that cannot be processed and  
                                                                            math error, or a notice of final assessment. 
      you do not correct it within 30 days (for returns due on  
      or after January 1, 1996) or 21 days (for returns due                 an additional liability is determined in a hearing, and  
      on or after January 1, 1994 through December 31,                      you do not pay the full amount due within 30 days after
      1995) of the date we notify you that we cannot process                  — all proceedings in court to review the final   
      your return.                                                             assessment have ended; or
                                                                              — the period for obtaining a court review of    
Late-filing (or nonfiling) penalty for transaction                             the final assessment has ended and the    
return                                                                         review proceedings were never instituted.
You owe this penalty if                                                      we send you a notice of tax liability or a notice of   
     you are a retailer required to file a transaction return               deficiency that becomes a final assessment without  
      (ST-556, Sales Tax Transaction Return, or                             a protest and hearing, and you do not pay the full  
      ST-556-LSE, Transaction Return for Leases);                           amount due before  the period for filing a           
      you do not file the transaction return by the due date as             protest expires. 
      required by the Retailers’ Occupation Tax Act and the  
      Use Tax Act; and                                               Bad check penalty
     the transaction return, if it had been properly filed,          You owe this penalty if you send any remittance to the 
      would not have resulted in the imposition of a tax             Department that is not honored by your financial institution. 
      (e.g., dealer trade or exempt sale).
Note: If you owe this late-filing (or nonfiling) penalty for a zero  Cost of collection fee
      liability transaction return, you are not subject to the       You owe this fee if we send you a request for payment of final 
      standard late-filing (or nonfiling) penalty.                   liability and you do not pay the full amount of tax, penalties, 
                                                                     and interest shown on the bill within 30 days of the date of the 
Late-payment penalty                                                 bill. 
Regular tax due 
You owe this penalty if you do not pay the tax due by the            Failure to file correct information return penalty
due date of the payment or the original due date of the return       You owe this penalty if you do not file a correct information 
without regard to extensions. Due dates differ depending on          return by the original due date of the return.
the tax type.
Note: Withholding income tax payment due dates are based             Fraud penalty
on the assigned payment schedule.                                    You owe this penalty if you file a return, an amended return, 
Late-payment penalty for underpayment of estimated or                or a claim for refund or credit with the intent to defraud.
quarter-monthly tax due 
You owe this penalty if you were required to make estimated          Frivolous return penalty
or quarter-monthly tax payments and failed to do so, or if you       You owe this penalty if you file Form IL-1040 and it does not 
failed to pay the required amount by the payment due date.           contain information needed to figure the correct tax or shows 
Note: Estimated payments mean quarterly payments for                 a substantially incorrect tax because you are taking a frivolous 
      business and individual income tax. Quarter-monthly            position or are trying to delay or interfere with the collection of 
payments include payments for sales and excise tax.                  the tax. 

Page 4 of 13                                                                                 PUB-103 (R-10/19, R-06/22 back page updated)

                                                                           Penalties and Interest for Illinois Taxes

Penalty Information

Negligence penalty                                               Material advisor penalties
You owe this penalty if, in preparing a return or amended        Material advisor penalties are imposed on people or 
return, you do not make a reasonable attempt to comply with      businesses who have organized, promoted, or sold a 
the provisions of any tax act, including showing careless,       potentially abusive tax shelter. The following three penalties 
reckless, or intentional disregard for the law or regulations.   may apply:

Personal liability penalty                                       1) Failure to register tax shelter penalty
You owe this penalty if you have control, supervision, or         You owe this penalty if you fail to register a listed 
are responsible for filing returns and making payment of the      transaction with us.
amount of any trust tax we administer, and willfully do not file 
the return or make the payment, or willfully attempt to evade      2) Failure to maintain a list of investors penalty
or defeat the tax.
                                                                 You owe this penalty if you fail to submit a copy of the 
                                                                 list of your investors to us. As an organizer or material 
                                                                 advisor, you are required to maintain and submit to us a 
What are the penalties for abusive tax                           list of your investors in a listed transaction. 
avoidance transactions (abusive tax 
                                                                   3) Promoting tax shelters penalty
shelters)?
                                                                 You owe this penalty if you are an organizer or seller of 
These penalties can be divided into two categories, participant  any plan or arrangement who has knowingly furnished a 
penalties and material advisor penalties.                        false statement about any tax deduction, credit, or other 
                                                                 tax benefit that is obtainable by that plan or arrangement. 
Participant penalties
Participant penalties are imposed on people or businesses         For more information about reportable transactions, 
who have participated in an abusive tax avoidance                listed transactions and tax shelters, visit the IRS website at 
transaction. The following three penalties may apply:            www.irs.gov.

1) Failure to disclose participation in a reportable   
  transaction penalty                                            What if I believe I have a good reason for 
  You owe this penalty if you fail to provide us with a copy     penalty abatement?
  of the disclosure  statement that you were required to         If you filed or paid late or your remittance was not honored by 
  file with the IRS regarding your participation in a            your financial institution, and you believe you made a good 
  reportable transaction.                                        faith effort to comply with the law, you may be entitled to an 
                                                                 abatement of late-filing penalty or late-payment penalty due to 
2) Reportable transaction understatement penalty                 “reasonable cause.” To request a waiver of late-filing penalty 
 You owe this penalty on any deficiency of Illinois              or late-payment penalty, you must provide us with a detailed 
Income Tax that is caused by participating in any                explanation of the cause of the delay and any documentation 
reportable transaction, if a significant purpose of the          you have to support your request. 
transaction is the avoidance or evasion of federal income 
tax, or by participating in any “listed transaction.”

3) 100 percent interest penalty
You owe this penalty if you have been contacted by 
the IRS or us regarding the use of a potential tax 
avoidance transaction and you have a deficiency from 
that transaction. This penalty is equal to 100 percent of 
the amount of interest assessed on the deficiency from 
the payment due date through the date that a notice of 
deficiency is issued.

PUB-103 (R-10/19, R-07/20 Back reformatted)                                                                      Page 5 of 13

Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after:

                           January 1, 1994 —                        January 1, 1996 —                      January 1, 1998 —
                           December 31, 1995                        December 31, 1997                      December 31, 2000

Late-filing (or nonfiling) 5% of tax required to be shown due       Tier 1 — the lesser of $250 or 2%      Tier 1 — the lesser of $250 or 2% 
                           on the return without regard to timely   of the tax required to be shown due    of the tax required to be shown due 
penalty                    payments made.                           on the return without regard to timely on the return without regard to timely 
                           If the return is timely filed but cannot payments or credits. If the return is  payments or credits. If the return is 
                           be processed, you will have 21 days      timely filed but cannot be processed,  timely filed but cannot be processed,  
                           to correct the return before penalty     you will have 30 days to correct the   you will have 30 days to correct the 
                           is due.                                  return before penalty is due.          return before penalty is due.
                                                                    Tier 2 — If you do not file a return   Tier 2 — If you do not file a return 
                                                                    within 30 days after receiving a       within 30 days after receiving a 
                                                                    notice of nonfiling, an additional     notice of nonfiling, an additional 
                                                                    penalty will be imposed equal to       penalty will be imposed equal to 
                                                                    the greater of $250 or 2% of the tax   the greater of $250 or 2% of the tax 
                                                                    shown due on the return without        shown due on the return without 
                                                                    regard to timely payments. The         regard to timely payments. The 
                                                                    additional penalty may not exceed      additional penalty may not exceed 
                                                                    $5,000. The penalty will be assessed   $5,000. The penalty will be assessed 
                                                                    even if there is no tax due.           even if there is no tax due.
                           Exceptions                               Exceptions                             Exceptions
                                                                                                                      
                           Motor Fuel Use Tax — 10% of the          Motor Fuel Use Tax — 10% of the        Motor Fuel Use Tax — 10% of the 
                           tax or $50, whichever is greater.        tax or $50, whichever is greater.      tax or $50, whichever is greater.
                           Coin-Operated Amusement Device           Coin-Operated Amusement Device         Coin-Operated Amusement Device 
                           Tax— 30% for failure to obtain a         Tax— 30% for failure to obtain a       Tax— 30% for failure to obtain a 
                           decal.                                   decal.                                 decal.
                                                                                                            
Late-payment penalty       15% of tax shown due on the return       15% of tax shown due on the return     20% of tax shown due on the return 
(for unpaid tax shown      or required to be shown due on the       or required to be shown due on the     or required to be shown due on the 
                           return and not paid by the due date.     return and not paid by the due date.   return and not paid by the due date. 
due on an original or 
amended return)

                           Note: If penalty for underpayment        Note: If penalty for underpayment      Note: If penalty for underpayment 
                           of estimated or accelerated tax          of estimated or accelerated tax        of estimated or accelerated tax 
                           payments is assessed, the tax            payments is assessed, the tax          payments is assessed, the tax 
                           amount that this penalty is assessed     amount that this penalty is assessed   amount that this penalty is assessed 
                           on is subtracted from the total tax.     on is subtracted from the total tax.   on is subtracted from the total tax. 
                           The remainder is the tax base on         The remainder is the tax base on       The remainder is the tax base on 
                           which the late-payment penalty may       which the late-payment penalty may     which the late-payment penalty may 
                           be assessed.                             be assessed.                           be assessed.

                           Exceptions                               Exceptions                             Exceptions       
                           Motor Fuel Use Tax — 10% of the          Motor Fuel Use Tax — 10% of the        Motor Fuel Use Tax — 10% of the 
                           tax or $50, whichever is greater.        tax or $50, whichever is greater.      tax or $50, whichever is greater.
                           Coin-Operated Amusement Device           Coin-Operated Amusement Device         Coin-Operated Amusement Device 
                           Tax— 30% for failure to obtain a         Tax— 30% for failure to obtain a       Tax— 30% for failure to obtain a 
                           decal.                                   decal.                                 decal.

Page 6 of 13                                                                                      PUB-103 (R-10/19, R-06/22 back page updated)

                                                                                       Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after: 

                                            January 1, 2001 —                                             January 1, 2004 —
                                            December 31, 2003                                             December 31, 2004

Late-filing (or nonfiling) Tier 1 — the lesser of $250 or 2% of the tax required to      Tier 1 — the lesser of $250 or 2% of the tax required to 
penalty                    be shown due on the return and reduced by timely pay-         be shown due on the return and reduced by timely pay-
                           ments or credits. If the return is timely filed but cannot be ments or credits. If the return is timely filed but cannot be 
                           processed, you will have 30 days to correct the  return       processed, you will have 30 days to correct the  return 
                           before penalty is due.                                        before penalty is due.
                           Tier 2 — If you do not file a return within 30 days after     Tier 2 — If you do not file a return within 30 days after 
                           receiving a notice of nonfiling, an additional penalty will   receiving a notice of nonfiling, an additional penalty will 
                           be imposed equal to the greater of $250 or 2% of the          be imposed equal to the greater of $250 or 2% of the 
                           tax shown due on the return without regard to timely          tax shown due on the return without regard to timely 
                           payments. The additional penalty may not exceed $5,000.       payments. The additional penalty may not exceed $5,000. 
                           The penalty will be assessed even if there is no tax due.     The penalty will be assessed even if there is no tax due. 
                           Exceptions                                                    Exceptions            
                           Motor Fuel Use Tax — 10% of the tax or $50, whichever         Motor Fuel Use Tax — 10% of the tax or $50, whichever 
                           is greater.                                                   is greater.
                           Coin-Operated Amusement Device Tax— 30% for                   Coin-Operated Amusement Device Tax — 30% for 
                           failure to obtain a decal.                                    failure to obtain a decal.

Late-payment penalty       Penalty is based on the number of days the tax required       Penalty is based on the number of days the tax required 
                           to be shown due on the return is late.                        to be shown due on the return is late.
(for unpaid tax shown 
due on an original or                       1    -    30 days: 2%                             1    -      30 days: 2%
                               31    -                90 days: 5%                             31    -     90 days:  10%
amended return)                91    -                180 days:  10%                          91    -     180 days:  15%
                            181   +                   days:  15%                                 181    + days:  20%
                           Note: If penalty for underpayment  of estimated or accel-     Note: If penalty for underpayment of estimated or accel-
                           erated tax payments is assessed, the tax amount that this     erated tax payments is assessed, the tax amount that this 
                           penalty is assessed on is subtracted from the total tax.      penalty is assessed on is subtracted from the total tax. 
                           The remainder is the tax base on which the late-payment       The remainder is the tax base on which the late-payment 
                           penalty may be assessed.                                      penalty may be assessed.

                           Exceptions                                                    Exceptions            
                           Motor Fuel Use Tax — 10% of the tax or $50, whichever         Motor Fuel Use Tax — 10% of the tax or $50, whichever 
                           is greater.                                                   is greater.
                           Coin-Operated Amusement Device Tax— 30% for                   Coin-Operated Amusement Device Tax— 30% for 
                           failure to obtain a decal.                                    failure to obtain a decal.

PUB-103 (R-10/19, R-07/20 Back reformatted)                                                                                    Page 7 of 13

Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after: 

                           January 1, 2005 —
                           to current
Late-filing (or nonfiling) Tier 1 — the lesser of $250 or 2% 
                           of the tax required to be shown due 
penalty                    on the return and reduced by timely 
                           payments or credits. If the return is 
                           timely filed but cannot be processed, 
                           you will have 30 days to correct the  
                           return before penalty is due.
                           Tier 2 — If you do not file a return 
                           within 30 days after receiving a 
                           notice of nonfiling, an additional 
                           penalty will be imposed equal to 
                           the greater of $250 or 2% of the tax 
                           shown due on the return without 
                           regard to timely payments. The 
                           additional penalty may not exceed 
                           $5,000. The penalty will be assessed 
                           even if there is no tax due.
                           Exceptions       
                           Motor Fuel Use Tax — 10% of the 
                           tax or $50, whichever is greater.
                           Coin-Operated Amusement Device 
                           Tax — 30% for failure to obtain a 
                           decal.
                           Penalty is based on the number of 
Late-payment penalty       days the tax required to be shown 
(for unpaid tax shown      due on the return is late.
due on an original or            1  -  30 days:         2%
                                 31 +        days:  10%
amended return)
                           However,However, the penalty is 15% of 
                           any amount that is not paid until 
                           after the initiation of an audit or 
                           investigation of your liability and 20% 
                           of any amount that is not paid within 
                           30 days after the issuance of an 
                           audit-prepared amended return or 
                           Form IL-870, Waiver of Restrictions, 
                           at the conclusion of the audit or 
                           investigation. The 20% penalty rate 
                           also applies to any amount paid 
                           within the 30-day period if you fail to 
                           sign and return the amended return 
                           within that period or if you pay the 
                           liability under protest or subsequently 
                           file a claim or refund of the payment.
                           Note: If penalty for underpayment 
                           of estimated or accelerated tax 
                           payments is assessed, the tax 
                           amount that this penalty is assessed 
                           on is subtracted from the total tax. 
                           The remainder is the tax base on 
                           which the late-payment penalty may 
                           be assessed.
                           Exceptions       
                           Motor Fuel Use Tax — 10% of the 
                           tax or $50, whichever is greater.
                           Coin-Operated Amusement Device 
                           Tax— 30% for failure to obtain a 
                           decal.
                           Withholding Income Tax — Late 
                           payment penalty is based upon the 
                           payment due date, not the return due 
                           date (effective January 1, 2008).
Page 8 of 13                                                       PUB-103 (R-10/19, R-06/22 back page updated)

                                                                                 Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after: 

                          January 1, 1994 —                       January 1, 1998 —                       January 1, 2001 — 
                          December 31, 1997                       December 31, 2000                       December 31, 2003

Late-payment penalty  -   15% of additional tax required to be    15% of additional tax required to be    20% of additional tax required to be 
                          shown due on the return not paid        shown due on the return not paid        shown due on the return not paid 
additional liability due  within 30 days of the date of a notice  within 30 days of the date of a notice  within 30 days of the date of a notice 
                          and demand for payment or notice of     and demand for payment or notice of     and demand for payment or notice of 
                          tax liability.                          tax liability.                          tax liability.

Late-payment penalty -    15% of any amount that is not timely    20% of any amount that is not timely    Penalty is based on the number of 
                          paid.
estimated or quarter-                                             paid.                                   days the payment is late.
                                                                                                              1  -         30 days:     2%
monthly tax due                                                                                               31  -        90 days:     5%
                                                                                                              91  -        180 days:  10%
                                                                                                                   181  +  days:  15%

Penalty for failure       $5 for each return or statement not     $5 for each return or statement not     $5 for each return or statement not 
to file correct           timely filed up to a total of $25,000   timely filed up to a total of $25,000   timely filed up to a total of $25,000 
information return        during any calendar year. If a return   during any calendar year. If a return   during any calendar year. If a return 
                          is filed within 60 days of the due      is filed within 60 days of the due      is filed within 60 days of the due 
                          date, the penalty may be reduced by     date, the penalty may be reduced by     date, the penalty may be reduced by 
                                                                  50 percent.                             50 percent.
                          50 percent.

Penalty for negligence 
                          20% of the deficiency attributable to   20% of the deficiency attributable to   20% of the deficiency attributable to 
                          the negligent act or omission.          the negligent act or omission.          the negligent act or omission.

Penalty for fraud
                          50% of the deficiency attributable to   50% of the deficiency attributable to   50% of the deficiency attributable to 
                          the fraudulent act or omission.         the fraudulent act or omission.         the fraudulent act or omission.

Penalty for 
                          An amount equal to the total amount     An amount equal to the total amount     An amount equal to the total amount 
personal liability        of unpaid tax, penalties, and interest. of unpaid tax, penalties, and interest. of unpaid tax, penalties, and interest.

Penalty for bad check
                          Not applicable.                         Not applicable.                         $25 for each remittance not honored 
                                                                                                          by the financial institution.

Cost of collection fee
                          Not applicable.                         Not applicable.                         Returns due on or after
                                                                                                          July 1, 2003 — 
                                                                                                          if the total unpaid amount is
                                                                                                          •  less than $1,000, penalty is $30
                                                                                                          •  $1,000 or more, penalty is $100

Penalty for 
                          $500                                    $500                                    $500
frivolous return

Late-filing (or nonfiling)
penalty for transaction   Not applicable.                         Not applicable.                         Not applicable.
return

PUB-103 (R-10/19, R-07/20 Back reformatted)                                                                                Page 9 of 13

Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after: 

                           January 1, 2004  —                      January 1, 2005 —                        August 16, 2013 —
                           December 31, 2004           August 15, 2013                                      to August 9, 2015
Late-payment penalty -     Not applicable.                         Not applicable.                         Not applicable.
additional liability due

Late-payment penalty -     Penalty is based on the number of       Penalty is based on the number          Penalty is based on the number
                           days the payment is late.               of days the payment is late.            of days the payment is late.
estimated or quarter-           1  -       30 days:      2%             1  -       30 days:      2%             1  -      30 days:      2%
monthly tax due                 31  -      90 days:  10%                31 +         days:  10%                 31 +      days:  10%
                                91  -  180 days:  15%                                                       
                            181 +          days:  20%

                           $5 for each return or statement not     $5 for each return or statement not     $5 for each return or statement not 
Penalty for failure        timely filed up to a total of $25,000   timely filed up to a total of $25,000   timely filed up to a total of $25,000 
to file correct            during any calendar year. If a return   during any calendar year. If a return   during any calendar year. If a return 
                           is filed within 60 days of the due      is filed within 60 days of the due      is filed within 60 days of the due 
information return         date, the penalty may be reduced by     date, the penalty may be reduced by     date, the penalty may be reduced by 
                           50 percent.                             50 percent.                             50 percent.

                           20% of the deficiency attributable to   20% of the deficiency attributable to   20% of the deficiency attributable to 
Penalty for negligence     the negligent act or omission.          the negligent act or omission.          the negligent act or omission.
                         
Penalty for fraud          50% of the deficiency attributable to   50% of the deficiency attributable to   50% of the deficiency attributable to 
                           the fraudulent act or omission.         the fraudulent act or omission.         the fraudulent act or omission.

Penalty for                An amount equal to the total amount     An amount equal to the total amount     An amount equal to the total amount 
                           of unpaid tax, penalties, and interest. of unpaid tax, penalties, and interest. of unpaid tax, penalties, and interest.
personal liability

                           $25 for each remittance not honored     $25 for each remittance not honored     $25 for each remittance not honored 
Penalty for bad check      by the financial institution.           by the financial institution.           by the financial institution.

Cost of collection fee     If the total unpaid amount is           If the total unpaid amount is           If the total unpaid amount is
                           •  less than $1,000, penalty is $30     •  less than $1,000, penalty is $30     •  less than $1,000, penalty is $30
                           •  $1,000 or more, penalty is $100      •  $1,000 or more, penalty is $100      •  $1,000 or more, penalty is $100

Penalty for                $500                                    $500                                    $500 
frivolous return

Late-filing (or nonfiling) Not applicable.                         Not applicable.                         $100
penalty for transaction 
    
return

Page 10 of 13                                                                                      PUB-103 (R-10/19, R-06/22 back page updated)

                                                                      Penalties and Interest for Illinois Taxes

Penalty rates for returns due on or after: 

                              August 10, 2015 —
                              to current

   Late-payment penalty -     Not applicable.
   additional liability due

   Late-payment penalty -     Penalty is based on the number
                              of days the payment is late.
   estimated or quarter-                    1  -  30 days: 2%
   monthly tax due                          31 +  days:  10%
                               
   Penalty for failure        $5 for each return or statement not 
                              timely filed up to a total of $25,000 
   to file correct            during any calendar year. If a return 
   information return         is filed within 60 days of the due 
                              date, the penalty may be reduced by 
                              50 percent.

   Penalty for negligence     20% of the deficiency attributable to 
                              the negligent act or omission.

   Penalty for fraud          50% of the deficiency attributable to 
                              the fraudulent act or omission.

   Penalty for 
                              An amount equal to the total amount 
   personal liability         of unpaid tax, penalties, and interest.

   Penalty for bad check      $25 for each remittance not honored 
                              by the financial institution.

   Cost of collection fee     If the total unpaid amount is
                              •  less than $1,000, penalty is $30
                              •  $1,000 or more, penalty is $100

   Penalty for                $500 
   frivolous return

   Late-filing (or nonfiling) $100, when the return, if it had 
   penalty for transaction    been properly filed, would not have 
                              resulted in the imposition of a tax.
   return 
                              Note: If you owe this late-filing (or 
                              nonfiling) penalty for a zero liability 
                              transaction return, you are not 
                              subject to the standard late-filing (or 
                              nonfiling) penalty.
PUB-103 (R-10/19, R-07/20 Back reformatted)                           Page 11 of 13

Penalties and Interest for Illinois Taxes

Penalties for Tax Avoidance Transactions 

Participant Penalties

Failure to disclose participation in a reportable  $15,000 for each undisclosed reportable transaction or $30,000 
transaction penalty                                for each “listed transaction.” The total penalty imposed shall not 
                                                   exceed 10% of the increase in net income or reduction in loss that 
                                                   would result if the taxpayer had not participated in the reportable 
                                                   transaction.

Reportable transaction understatement penalty      20% of deficiency or 30% if the transaction was not disclosed.

100 percent interest penalty                       100% of interest assessed on the tax avoidance transaction 
                                                   deficiency from payment due date through date a notice of deficiency 
                                                   is issued.

Material Advisor Penalties
Failure to register tax shelter penalty            $15,000 for each transaction or $100,000 for each unregistered 
                                                   “listed transaction.”

Failure to maintain a list of investors penalty    $15,000 for each failure or $100,000 if the failure involves a “listed 
                                                   transaction.”

Promoting tax shelters penalty                     The greater of $10,000 or 50% of the gross income received (or to be 
                                                   received) from anyone required to file an Illinois return and to whom 
                                                   you furnished a false statement.

Page 12 of 13                                                           PUB-103 (R-10/19, R-06/22 back page updated)

                                                                      Penalties and Interest for Illinois Taxes

Interest Rates

After December 31, 2013,interest accrues at the “underpayment rate,” regardless of when the underpayment arose.

During the period covering January 1, 2004, through December 31, 2013, interest accrued on on the “short term federal rate” 
for the first year. This is 3 percent less than the “underpayment rate.” After one year, interest would accrue on any remaining 
balance at the “underpayment rate.” 

Prior to January 1, 2004, interest accrued at the “underpayment rate.”

Interest rates are available on our website at tax.illinois.gov.
Abusive Tax Shelter —
If you are found to have participated in an abusive tax shelter transaction and did not report and pay any liability associated with that 
transaction before you were contacted by the IRS or us, interest on that liability will be assessed at 150 percent of the rate in effect at that 
time.

PUB-103 (R-10/19, R-07/20 Back reformatted)                                                              Page 13 of 13

                                                                    Penalties and Interest for Illinois Taxes

Office Locations

                                         Suburban North Regional Building
                                         9511 Harrison Street FA 203
                                         Des Plaines, Illinois 60016-1563

200 South Wyman Street
Rockford, Illinois 61101-1237                                                555 West Monroe Street
                                                                             Suite 1100
                                                                             Chicago, Illinois 60661

                                                                             Willard Ice Building
                                                                             101 West Jefferson
                                                                             Springfield, Illinois 62702-5145

15 Executive Drive
Business Center One, Suite 2
Fairview Heights, Illinois 62208-1331

                         2309 W. Main, Suite 114
                         Marion, Illinois 62959-1196

Contact Information Visit our website at tax.illinois.gov. For specific phone number and email contacts see our 
                         Contact Us page. 
                    Call us at 1 800 732-8866 or 217 782-3336.
                    Call our TDD (telecommunications device for the deaf) at 1 800 544-5304.
                    Write us at Illinois Department of Revenue, PO Box 19001, Springfield, IL  62794-9001.
                    Call our 24-hour Forms Order Line at 1 800 356-6302. 

Printed by authority of the State of Illinois. Web only — one copy.          PUB-103 (R-10/19, R-06/22 back page updated)