President Preckwinkle Generating New Revenue by Cracking Down on Cook County Tax Scofflaws

From pilsners to parking lots, Cook County Board President Toni Preckwinkle is aggressively tracking down tax scofflaws in an effort to increase County revenue while protecting honest taxpaying businesses and residents. Through a comprehensive compliance and enforcement initiative directed by the Cook County Department of Revenue (DOR), $6.7 million in previously unidentified taxes were collected from businesses like microbreweries and parking lots in 2014. In 2015, DOR has already pinpointed $3.5 million.

A number of compliance enforcement methods including audits, tax discovery analytics, and mailing notices have increased dramatically during the Preckwinkle administration. In 2014, $2.8 million was generated from audits, $1.2 million in discovery, $1.3 million in delinquency notices, and $900,000 in voluntary disclosures.

“By cracking down on scofflaws who are evading taxes and fees, we are ensuring a level playing field for businesses in the County,” Preckwinkle said. “Whether taxes are not being paid due to willful avoidance or accidental oversight, we are ensuring that all County businesses and taxpayers are compliant with our existing laws. I’ve made no secret that there are significant fiscal challenges ahead, so every bit helps.”

Tax discovery is an enforcement tool to identify new taxpayers through a number of approaches including canvassing, industry research and data sharing. A liquor industry review of microbreweries in Cook County has led to almost half a million dollars in new taxes being assessed. Tax discovery work, audits and voluntary disclosure led to $1.9 million in new taxes being collected from the parking industry and $900,000 from area tour boats and buses. An additional $300,000 in back taxes was brought in by using data obtained from the Secretary of State to bring over 125 previously unregistered car dealers into compliance.

Through the audit process, the Department of Revenue looks at books and records of taxpayers to verify the correct amount is being reported and paid. In 2013, a little over $1 million was generated from enforcement efforts. That amount increased to $2.8 million in 2014. In the first three months of the current fiscal year, almost $3.4 million has already been collected through the audit process. The nearly 80 audits in 2014 represent a dramatic increase from the 53 audits conducted in 2013 and the eight audits in 2012.

Already in 2015, a bolstered tax deficiency and delinquency mailing process has facilitated over $2 million in new collections to date. This process saved the County $367,000 that would have otherwise been paid out to a collection agency that retains between 17% - 25% of any collections made.

Preckwinkle added that in 2015 the Department of Revenue will continue to increase audits, expand discovery efforts to other taxes and upgrade technology infrastructure to expand enforcement to benefit the majority of taxpayers that play by the rules.