At times I really believe that Illinois Department of Revenue does nothing but think of dirty tricks and schemes to play on its citizens.
The most recent case has occurred to two of our clients so far this year. In both cases the husband and wife both work for the same company, so you know all tax reporting was either done or not done.
Illinois is ignoring the withholding from one of the spouses and sending them a bill for the “missing” spouses withholding. I guess that they are desperate for more income, hoping that people will just double their withholding without question.
To fight this they will not take a letter from a CPA, they are specific on this in the notice. But they are demanding that you send in a copy of your W-2 (which they already have, we have to key in all of the information for clients through MyTaxIL.illinois.gov), but you also need to send in a copy of your last paystub for the year or get a letter from your employer on their stationary guaranteeing that the withholding is correct.
Illinois get this information from the SSA and from the company through their payroll services. The information is reconciled from the companies through their IL-941 filings and the UI 3/40 unemployment forms filed. So the fact that they want these additional steps are leading me to suggest to clients that they withholding nothing for Illinois and pay their taxes in full with the 1040 filing. Yes there will be some penalties and interest. But then there is only the single check to resend to Illinois if they keep up this harassment of its citizenry.