As of January 1, 2025, several legislative changes in Illinois have introduced new accounting and financial reporting requirements for businesses in the Chicagoland area. To ensure compliance and maintain accurate financial records, consider the following key updates:
1. Destination-Based Retailers' Occupation Tax (ROT)
Illinois has shifted to a destination-based ROT system, affecting how sales taxes are collected and remitted:
2. Vendor's Discount Cap and Interchange Fee Prohibition
Changes affecting cash flow and transaction processing include:
3. Pay Transparency Requirements
The Illinois Equal Pay Act mandates that employers with 15 or more employees include pay scales and benefits in all job postings.
Action Steps: Review and update your job posting templates to incorporate salary and benefits information. Ensure that your payroll systems are aligned with the advertised compensation to maintain consistency and compliance.
4. Personnel Record Disclosure Obligations
Amendments to the Personnel Record Review Act require employers to provide employees access to various employment-related documents upon request, including benefits-related records, employment contracts, handbooks, and policies affecting employment qualifications.
Action Steps: Implement a process to handle personnel record requests efficiently. Maintain organized and up-to-date records to facilitate timely compliance.
5. Minimum Wage Increase
The state minimum wage has increased to $15 per hour as of January 1, 2025.
Action Steps: Update your payroll systems to reflect the new wage rates. Review your budgeting and financial planning to accommodate the increased labor costs.
Staying informed about these legislative changes is crucial for maintaining compliance and ensuring accurate financial reporting. Regularly consult with accounting professionals to adapt your practices to the evolving regulatory landscape.
Read more: www.dailyherald.com/20250222/business/new-year-new-laws-affecting-businesses-in-2025/
1. Destination-Based Retailers' Occupation Tax (ROT)
Illinois has shifted to a destination-based ROT system, affecting how sales taxes are collected and remitted:
- Previous System: Retailers collected tax based on the location of the seller.
- New System: Taxes are now based on the location where the purchaser takes possession of the goods.
2. Vendor's Discount Cap and Interchange Fee Prohibition
Changes affecting cash flow and transaction processing include:
- Vendor's Discount Cap: The discount for timely filing sales and use tax returns is now capped at $1,000 per month.
- Interchange Fee Prohibition: Effective July 1, 2025, interchange fees on the tax and gratuity portions of credit card transactions are prohibited, provided merchants inform banks of these amounts.
3. Pay Transparency Requirements
The Illinois Equal Pay Act mandates that employers with 15 or more employees include pay scales and benefits in all job postings.
Action Steps: Review and update your job posting templates to incorporate salary and benefits information. Ensure that your payroll systems are aligned with the advertised compensation to maintain consistency and compliance.
4. Personnel Record Disclosure Obligations
Amendments to the Personnel Record Review Act require employers to provide employees access to various employment-related documents upon request, including benefits-related records, employment contracts, handbooks, and policies affecting employment qualifications.
Action Steps: Implement a process to handle personnel record requests efficiently. Maintain organized and up-to-date records to facilitate timely compliance.
5. Minimum Wage Increase
The state minimum wage has increased to $15 per hour as of January 1, 2025.
Action Steps: Update your payroll systems to reflect the new wage rates. Review your budgeting and financial planning to accommodate the increased labor costs.
Staying informed about these legislative changes is crucial for maintaining compliance and ensuring accurate financial reporting. Regularly consult with accounting professionals to adapt your practices to the evolving regulatory landscape.
Read more: www.dailyherald.com/20250222/business/new-year-new-laws-affecting-businesses-in-2025/
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