As accountants, we know that unresolved tax liabilities can lead to escalating penalties and interest but the Illinois Department of Revenue is offering a rare opportunity for a clean slate. Effective soon, the 2025 Illinois Tax Delinquency Amnesty Act provides a window for eligible taxpayers to settle outstanding state tax debts and wipe away associated penalties and interest.

What Is the Amnesty Program?

Per bulletin FY 2026‑01, the Illinois Tax Delinquency Amnesty Act allows eligible taxpayers to pay overdue state tax liabilities without incurring penalties or interest, as long as they settle in full during the amnesty window.

Eligible Periods and Timeline

• Covered tax periods: Liabilities from periods ending after June 30, 2018, up to before July 1, 2024, qualify.
• Amnesty window: Payments and required filings must occur between October 1, 2025, and November 17, 2025.

Who Qualifies?

Individuals and businesses with unpaid liabilities for state taxes administered by the Illinois Department of Revenue during the eligible period qualify for the amnesty program.

• Excluded liabilities:
  • Taxes not collected by IDOR, including property, estate, franchise, insurance, and local taxes paid directly to local governments.
  • Debts for periods ending on or before June 30, 2018, or on or after July 1, 2024.
  • Motor Fuel Use Tax (MFUT) including IFTA liabilities.
  • Non‑tax liabilities such as licensing fees, tire user fees, permits, etc.
  • Note: Telecommunications Infrastructure Maintenance Fee is eligible.

• Items not waived by amnesty:
  • Lien filing and lien release fees.
  • Books and records penalties.
  • Bad check penalties.
  • Collection agency service fees.
  • Penalty and interest on tax liabilities that were fully paid prior to amnesty.
  • Penalty and interest amounts associated with MFUT (i.e. IFTA).
  • Various other penalties and fees that are not based on a tax liability (e.g., abusive tax shelter penalties, frivolous return penalties, and certain audit penalties).

How to Participate

1. File any missing returns or amend incorrect filings for the eligible periods. Include any supporting documentation.

2. Pay the full tax amount due during the amnesty window (Oct. 1 – Nov. 17, 2025).

3. If your liability has already been referred to a private collection agency, you must pay through that agency, do not pay IDOR directly.

4. Use MyTax Illinois for convenient payment but if you need an account, request a Letter ID, which may take up to 10 days to receive. If your account isn’t ready by November 17, you’ll need an alternative payment method.

Why This Matters

Tax liabilities can quietly compound. What might begin as a modest underpayment can balloon with added penalties, interest, and collection costs. This amnesty program offers relief: an opportunity to settle past issues cleanly and efficiently.

If you’re unsure whether you qualify or how to rectify your filings, now is a great time to reach out. At Cray Kaiser, we’re here to help guide you step by step. Contact us to discuss how the Illinois Announces Tax Amnesty Program may impact your tax situation.