This Illinois Act became effective in 2008. Some recent amendments to that Act became effective on January 1, 2014. See 820 ILCS 185/1 et. seq.
The Act has always contained record keeping requirements. Basically those requirements are:
Keep 3 years of records for all individuals who perform services for the business regardless of how you classify them, independent contractors or employees.
1. These records include name, address, phone number, social security number, FEIN's etc.
2. The type of work performed and the total number of days and hours worked
3. The method, frequency and basis on which wages or payments were made.
4. Invoices, billing statements, and payment records including dates and amounts paid and deductions.
5. Copies of all contracts, agreements, applications or employment manuals.
6. Any federal and state tax documents.
The Amendments
Public Act 98-105 creates new reporting requirements. By January 31st after the end of each taxable year in which payments are made to an individual, sole proprietor or partnership for construction services if the recipient is not classified as an employee a contractor must file a report with the Illinois Department of Labor that includes:
(1) the contractor's name, address, and business identification number;
(2) the individual, sole proprietor, or partnership name, address, and federal employer identification number; and
(3) the total amount the contractor paid to the individual, sole proprietor, or partnership performing services in the taxable year, including payments for services and for any materials and equipment that was provided along with the services.
Reports filed under this Section are confidential and exempt from public disclosure other than to employees in performance of their official duties. However, the name of the reporting contractor and the name of the individual, sole proprietor, or partnership performing construction services
shall be disclosed upon request by the general public under the Freedom of Information Act.
Failure to file reports have the same penalty as other violations of the Act
This reporting requirement does not apply to material suppliers
Public Act 98-106
Reduces the fines from $1,500 for a first violation to $1,000 and from $2,500 to $2,000 for subsequent violations within 5 years.
Makes any officer or agent of a corporation who knowingly allows that corporation to violate this law personally liable.
