On September 17, 2014, the Circuit Court of Cook County entered summary judgment in favor of the Chicagoland Chamber of Commerce, represented by Reed Smith LLP (“Reed Smith”), on the remaining count of their Complaint challenging the Cook County Non-Titled Personal Property Use Tax (the “Use Tax”). The court ordered Cook County tax authorities to process claims for refund received from Use Tax taxpayers filing claims pursuant to the Uniform Penalties and Procedures Ordinance, commencing no later than September 24, 2014.

The ruling declaring the Use Tax invalid was affirmed on August 4, 2014 by the Appellate Court in Reed Smith LLP v. Zahra Ali, et al., 2014 IL App (1st) 132646-U (See our prior Tax Alerts from August 5, 2014, October 8, 2013, July 24, 2013, June 24, 2013, June 14, 2013, May 30, 2013 and March 25, 2013). Remaining in the lower court was a count of the complaint wherein Reed Smith argued on behalf of the Chicagoland Chamber for declaratory judgment that the invalidity of the Use Tax was a sufficient basis for Cook County to process claims for credit or refund under its Uniform Penalties and Procedures Ordinance (the “Refund Ordinance”). The Refund Ordinance conditions such claims on the existence of a mistake of fact or an error in law, and in court the County asserted it also required that the taxpayer had paid the tax “under protest.” The Refund Ordinance contains no such requirement.

Under the Refund Ordinance, a claim for credit or refund may be filed on a form provided by the Cook County Department of Revenue within four years from the date of the remittance of the tax. A key procedural point is that if a taxpayer receives a written notice of tentative determination denying the claim, a written protest must be filed within 20 days of mailing of the written notice of tentative determination of the claim.

Barring an appeal of the Order entered on September 17, 2014, this completes a comprehensive victory for all Cook County businesses and individuals who benefit from Reed Smith’s and the Chicagoland Chamber of Commerce’s challenge to the Cook County Non-Titled Personal Property Use Tax.

For more information on the challenge to the Use Tax and the process for obtaining a refund of any Use Tax paid, contact the authors of this Alert or another member of the Reed Smith State Tax Group. For more information on Reed Smith’s Illinois tax practice, visit www.reedsmith.com/iltax.

About Reed Smith State Tax Reed Smith’s state and local tax practice is composed of more than 30 lawyers across seven offices nationwide. The practice focuses on state and local audit defense and refund appeals (from the administrative level through the appellate courts), as well as planning and transactional matters involving income, franchise, unclaimed property, sales and use, and property tax issues. Click here to view our State Tax team.

Client Alert 2014-243