RTA Leader in Tax Recovery Work
RTA Seeks Injunctive and Declaratory Relief Regarding New Sales Tax Rules
The RTA filed a lawsuit in Cook County Circuit Court seeking a preliminary and permanent injunction to bar enforcement of administrative rules recently approved by the Joint Committee on Administrative Rules (JCAR) and filed by the Illinois Department of Revenue. The lawsuit asks the Court to declare that the new rules are invalid, because they exceed the Department’s authority to regulate. The Department promulgated new rules following the Illinois Supreme Court’s decision last November in Hartney Fuel Oil v. Hamer, which invalidated the Department’s previous sales tax sourcing rules. The new rules were approved by JCAR on June 17 over the objections of the RTA, the Metropolitan Mayors Caucus and numerous individual municipalities, including the City of Chicago. Read more...
American Airlines Lawsuit
The Regional Transportation Authority filed suit against American Airlines to force the company and its affiliated fuel subidiary to comply with Illinois law and stop diverting millions in sales tax revenues owed to local governments and transit agencies from the six-county Chicago area. The lawsuit alleges that American is engaged in an "unlawful scheme" by its fuel subsidiary's false reporting of the site of bulk jet fuels sales to avoid paying taxes due to the RTA.
Learn more about the American Airlines lawsuit.
United Airlines Lawsuit
The Regional Transportation Authority filed a lawsuit against two of the world’s largest airlines that are running sham business operations. These sham operations have deprived Chicago and Cook County taxpayers, as well as public transportation agencies, of nearly $300 million over the last seven years. The RTA is alleging that United Airlines and American Airlines operate sham offices in Sycamore, IL that they use to avoid paying higher taxes from their actual offices in Chicago. These small, part-time offices are rarely occupied and, in at least one case, don’t appear to even have a computer. But both multi-billion dollar companies claim they purchase their jet fuel – one of their largest expenses – from those offices.
Learn more about the United Airlines lawsuit.
Channahon and Kankakee Lawsuits
In August 2011, the RTA filed suit in the Circuit Court of Cook County to recoup more than $100 million of revenue lost to tax avoidance scams operating in the municipalities of Channahon and Kankakee. The lawsuit arose from the utilization of tax sharing agreements which induced companies operating within the six-county RTA region and across the State to claim that their sales were sourced through sham offices set up in Channahon and Kankakee. As a result, both municipalities benefited from nearly the entire amount of their local share of the statewide sales tax to participating companies and have mislead the community by not creating jobs, promoting economic development or having any operations in Channahon and Kankakee.
Learn more about the Channahon and Kankakee lawsuits.
Genoa, Savanna and Morris Lawsuits
The Regional Transportation Authority (“RTA”) on Wednesday filed lawsuits against companies that have entered into sales tax rebate agreements with three Illinois towns located outside of the RTA region in order to avoid paying taxes to the RTA and other local governments in the RTA region. The lawsuits filed in Cook County name several companies, all of which have offices and significant operations in the RTA region. The companies are accused of deliberately avoiding the RTA region’s sales tax rate by establishing sham sales offices outside of the RTA region in the small Illinois communities of Genoa, Savanna and Morris.
Learn more about the Genoa, Savanna and Morris Lawsuits.
Legislation and Rules
The Regional Transportation Authority will monitor and support rules and legislation to end the practice of diverting sales tax.
Learn more about Legislations and Rules.