Policy Statement\u00a0<\/strong><\/p>\n

Disclosure of Confidential Tax Return Information \u00a0<\/strong><\/p>\n

From time to time legislation is introduced that would require or allow public disclosure of information that is included in tax returns.\u00a0 Such legislation undermines the traditional notion of taxpayer privacy and business confidentiality.\u00a0 The Taxpayers\u2019 Federation of Illinois opposes legislation of this type as it hinders a key premise of our voluntary compliance tax system.<\/p>\n

The federal government has occasionally considered disclosing tax returns or return information, but the idea has always been abandoned as unwise.\u00a0 In 2000, the Congressional Joint Committee on Taxation conducted a major study of tax disclosure measures and policies, and reached the following conclusions, equally applicable in Illinois today:<\/p>\n

Taxpayers have a justifiable expectation of privacy in the extensive information they furnish to the IRS under penalty of fine or imprisonment\u2026.[Our] tax system is based on voluntary compliance.\u00a0 Many observers believe that the degree of voluntary compliance is directly affected by the degree of confidentiality given the information that is provided to the IRS\u2026. <\/em><\/p>\n

\u00a0<\/em>If returns and return information were publicly available, it would invite a variety of intrusions into a taxpayer\u2019s privacy.\u00a0 Business competitors could use the information to gain economic advantage\u2026.A lack of confidentiality could also facilitate the use of return information for political gain. [Footnotes omitted] (JCS 00<\/em>\u2010<\/em>1, Volume 1 of 3, pp 127<\/em>\u2010<\/em>128) <\/em><\/p>\n

The stated purpose of these \u201ctransparency\u201d efforts is usually to evaluate specific tax provisions and to ensure equal treatment of all taxpayers, through legislative, public, or third-party analysis of the disclosed information. There are better and less invasive means to accomplish these goals.\u00a0 The Legislature should periodically evaluate the provisions of our tax code, but the information necessary to complete this task can be obtained from the Illinois Department of Revenue, which has access to all<\/em> returns filed, and can provide aggregate or properly segmented data to the legislature (and the public) and can do so without violating taxpayer confidentiality.<\/p>\n

Illinois\u2019 tax laws and returns are complicated.\u00a0 Access to information from taxpayers\u2019 returns will not improve the public\u2019s perception or understanding of our State\u2019s taxes.\u00a0 The information will be confusing and potentially misleading.<\/p>\n

Worse than the failure to accomplish their stated goals, these measures create new problems:<\/p>\n

\n
• Illinois will become even more of an outlier in its tax policies and therefore an even less attractive state to invest and create jobs.<\/li>\n
• Illinois businesses will be at a disadvantage; many of their competitors in other states will not be subject to the disclosure requirements.<\/li>\n
• Other states will use these provisions as examples of Illinois\u2019 anti-taxpayer climate.<\/li>\n
• The Illinois Department of Revenue\u2019s ability to obtain federal tax information from the IRS (in order to enforce our tax provisions) may be jeopardized\u2014the information\u2010sharing agreement between the federal government and state agencies is very protective of taxpayer privacy.<\/li>\n<\/ul>\n

  The Taxpayers\u2019 Federation of Illinois is prepared to work with those who are interested in evaluating specific Illinois tax provisions, but this can be done without revealing confidential information. Such confidentiality is key to our voluntary tax system and should not be jeopardized.<\/p>\n

  February 2023<\/p>\n

   <\/p>\n

  Printer friendly version<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

  Policy Statement\u00a0 Disclosure of Confidential Tax Return Information \u00a0 From time to time legislation is introduced that would require or allow public disclosure of information that is included in tax returns.\u00a0 Such legislation undermines the traditional notion of taxpayer privacy and business confidentiality.\u00a0 The Taxpayers\u2019…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[],"class_list":["post-937","post","type-post","status-publish","format-standard","hentry","category-position-statements"],"_links":{"self":[{"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/posts\/937","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/illinoistax.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=937"}],"version-history":[{"count":11,"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/posts\/937\/revisions"}],"predecessor-version":[{"id":3611,"href":"http:\/\/illinoistax.org\/index.php?rest_route=\/wp\/v2\/posts\/937\/revisions\/3611"}],"wp:attachment":[{"href":"http:\/\/illinoistax.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=937"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/illinoistax.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=937"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/illinoistax.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=937"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}