Sen. William E. Brady

Filed: 4/20/2018

 

 


 

 


 
10000SB2672sam001LRB100 17696 HLH 38557 a

1
AMENDMENT TO SENATE BILL 2672

2    AMENDMENT NO. ______. Amend Senate Bill 2672 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Income Tax Act is amended by
5changing Sections 201 and 901 as follows:
 
6    (35 ILCS 5/201)  (from Ch. 120, par. 2-201)
7    Sec. 201. Tax imposed.
8    (a) In general. A tax measured by net income is hereby
9imposed on every individual, corporation, trust and estate for
10each taxable year ending after July 31, 1969 on the privilege
11of earning or receiving income in or as a resident of this
12State. Such tax shall be in addition to all other occupation or
13privilege taxes imposed by this State or by any municipal
14corporation or political subdivision thereof.
15    (b) Rates. The tax imposed by subsection (a) of this
16Section shall be determined as follows, except as adjusted by

 

 

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1subsection (d-1):
2        (1) In the case of an individual, trust or estate, for
3    taxable years ending prior to July 1, 1989, an amount equal
4    to 2 1/2% of the taxpayer's net income for the taxable
5    year.
6        (2) In the case of an individual, trust or estate, for
7    taxable years beginning prior to July 1, 1989 and ending
8    after June 30, 1989, an amount equal to the sum of (i) 2
9    1/2% of the taxpayer's net income for the period prior to
10    July 1, 1989, as calculated under Section 202.3, and (ii)
11    3% of the taxpayer's net income for the period after June
12    30, 1989, as calculated under Section 202.3.
13        (3) In the case of an individual, trust or estate, for
14    taxable years beginning after June 30, 1989, and ending
15    prior to January 1, 2011, an amount equal to 3% of the
16    taxpayer's net income for the taxable year.
17        (4) In the case of an individual, trust, or estate, for
18    taxable years beginning prior to January 1, 2011, and
19    ending after December 31, 2010, an amount equal to the sum
20    of (i) 3% of the taxpayer's net income for the period prior
21    to January 1, 2011, as calculated under Section 202.5, and
22    (ii) 5% of the taxpayer's net income for the period after
23    December 31, 2010, as calculated under Section 202.5.
24        (5) In the case of an individual, trust, or estate, for
25    taxable years beginning on or after January 1, 2011, and
26    ending prior to January 1, 2015, an amount equal to 5% of

 

 

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1    the taxpayer's net income for the taxable year.
2        (5.1) In the case of an individual, trust, or estate,
3    for taxable years beginning prior to January 1, 2015, and
4    ending after December 31, 2014, an amount equal to the sum
5    of (i) 5% of the taxpayer's net income for the period prior
6    to January 1, 2015, as calculated under Section 202.5, and
7    (ii) 3.75% of the taxpayer's net income for the period
8    after December 31, 2014, as calculated under Section 202.5.
9        (5.2) In the case of an individual, trust, or estate,
10    for taxable years beginning on or after January 1, 2015,
11    and ending prior to July 1, 2017, an amount equal to 3.75%
12    of the taxpayer's net income for the taxable year.
13        (5.3) In the case of an individual, trust, or estate,
14    for taxable years beginning prior to July 1, 2017, and
15    ending after June 30, 2017, an amount equal to the sum of
16    (i) 3.75% of the taxpayer's net income for the period prior
17    to July 1, 2017, as calculated under Section 202.5, and
18    (ii) 4.95% of the taxpayer's net income for the period
19    after June 30, 2017, as calculated under Section 202.5.
20        (5.4) In the case of an individual, trust, or estate,
21    for taxable years beginning on or after July 1, 2017, and
22    ending prior to the first July 1 following the commencement
23    of the pension benefit election procedures established
24    pursuant to Sections 14-106.5, 15-132.9, 16-122.9, and
25    17-115.5 of the Illinois Pension Code as added by Senate
26    Bill 16 of the 100th General Assembly, an amount equal to

 

 

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1    4.95% of the taxpayer's net income for the taxable year.
2        (5.5) In the case of an individual, trust, or estate,
3    for taxable years beginning prior to the first July 1, and
4    ending after the first June 30, following the commencement
5    of the pension benefit election procedures established
6    pursuant to Sections 14-106.5, 15-132.9, 16-122.9, and
7    17-115.5 of the Illinois Pension Code as added by Senate
8    Bill 16 of the 100th General Assembly, an amount equal to
9    the sum of (i) 4.95% of the taxpayer's net income for the
10    period prior to such July 1, as calculated under Section
11    202.5, and (ii) 4.7% of the taxpayer's net income for the
12    period after such June 30, as calculated under Section
13    202.5.
14        (5.6) In the case of an individual, trust, or estate,
15    for taxable years beginning on or after the first July 1
16    following the commencement of the pension benefit election
17    procedures established pursuant to Sections 14-106.5,
18    15-132.9, 16-122.9, and 17-115.5 of the Illinois Pension
19    Code as added by Senate Bill 16 of the 100th General
20    Assembly, an amount equal to 4.7% of the taxpayer's net
21    income for the taxable year.
22        (6) In the case of a corporation, for taxable years
23    ending prior to July 1, 1989, an amount equal to 4% of the
24    taxpayer's net income for the taxable year.
25        (7) In the case of a corporation, for taxable years
26    beginning prior to July 1, 1989 and ending after June 30,

 

 

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1    1989, an amount equal to the sum of (i) 4% of the
2    taxpayer's net income for the period prior to July 1, 1989,
3    as calculated under Section 202.3, and (ii) 4.8% of the
4    taxpayer's net income for the period after June 30, 1989,
5    as calculated under Section 202.3.
6        (8) In the case of a corporation, for taxable years
7    beginning after June 30, 1989, and ending prior to January
8    1, 2011, an amount equal to 4.8% of the taxpayer's net
9    income for the taxable year.
10        (9) In the case of a corporation, for taxable years
11    beginning prior to January 1, 2011, and ending after
12    December 31, 2010, an amount equal to the sum of (i) 4.8%
13    of the taxpayer's net income for the period prior to
14    January 1, 2011, as calculated under Section 202.5, and
15    (ii) 7% of the taxpayer's net income for the period after
16    December 31, 2010, as calculated under Section 202.5.
17        (10) In the case of a corporation, for taxable years
18    beginning on or after January 1, 2011, and ending prior to
19    January 1, 2015, an amount equal to 7% of the taxpayer's
20    net income for the taxable year.
21        (11) In the case of a corporation, for taxable years
22    beginning prior to January 1, 2015, and ending after
23    December 31, 2014, an amount equal to the sum of (i) 7% of
24    the taxpayer's net income for the period prior to January
25    1, 2015, as calculated under Section 202.5, and (ii) 5.25%
26    of the taxpayer's net income for the period after December

 

 

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1    31, 2014, as calculated under Section 202.5.
2        (12) In the case of a corporation, for taxable years
3    beginning on or after January 1, 2015, and ending prior to
4    July 1, 2017, an amount equal to 5.25% of the taxpayer's
5    net income for the taxable year.
6        (13) In the case of a corporation, for taxable years
7    beginning prior to July 1, 2017, and ending after June 30,
8    2017, an amount equal to the sum of (i) 5.25% of the
9    taxpayer's net income for the period prior to July 1, 2017,
10    as calculated under Section 202.5, and (ii) 7% of the
11    taxpayer's net income for the period after June 30, 2017,
12    as calculated under Section 202.5.
13        (14) In the case of a corporation, for taxable years
14    beginning on or after July 1, 2017, an amount equal to 7%
15    of the taxpayer's net income for the taxable year.
16    The rates under this subsection (b) are subject to the
17provisions of Section 201.5.
18    (c) Personal Property Tax Replacement Income Tax.
19Beginning on July 1, 1979 and thereafter, in addition to such
20income tax, there is also hereby imposed the Personal Property
21Tax Replacement Income Tax measured by net income on every
22corporation (including Subchapter S corporations), partnership
23and trust, for each taxable year ending after June 30, 1979.
24Such taxes are imposed on the privilege of earning or receiving
25income in or as a resident of this State. The Personal Property
26Tax Replacement Income Tax shall be in addition to the income

 

 

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1tax imposed by subsections (a) and (b) of this Section and in
2addition to all other occupation or privilege taxes imposed by
3this State or by any municipal corporation or political
4subdivision thereof.
5    (d) Additional Personal Property Tax Replacement Income
6Tax Rates. The personal property tax replacement income tax
7imposed by this subsection and subsection (c) of this Section
8in the case of a corporation, other than a Subchapter S
9corporation and except as adjusted by subsection (d-1), shall
10be an additional amount equal to 2.85% of such taxpayer's net
11income for the taxable year, except that beginning on January
121, 1981, and thereafter, the rate of 2.85% specified in this
13subsection shall be reduced to 2.5%, and in the case of a
14partnership, trust or a Subchapter S corporation shall be an
15additional amount equal to 1.5% of such taxpayer's net income
16for the taxable year.
17    (d-1) Rate reduction for certain foreign insurers. In the
18case of a foreign insurer, as defined by Section 35A-5 of the
19Illinois Insurance Code, whose state or country of domicile
20imposes on insurers domiciled in Illinois a retaliatory tax
21(excluding any insurer whose premiums from reinsurance assumed
22are 50% or more of its total insurance premiums as determined
23under paragraph (2) of subsection (b) of Section 304, except
24that for purposes of this determination premiums from
25reinsurance do not include premiums from inter-affiliate
26reinsurance arrangements), beginning with taxable years ending

 

 

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1on or after December 31, 1999, the sum of the rates of tax
2imposed by subsections (b) and (d) shall be reduced (but not
3increased) to the rate at which the total amount of tax imposed
4under this Act, net of all credits allowed under this Act,
5shall equal (i) the total amount of tax that would be imposed
6on the foreign insurer's net income allocable to Illinois for
7the taxable year by such foreign insurer's state or country of
8domicile if that net income were subject to all income taxes
9and taxes measured by net income imposed by such foreign
10insurer's state or country of domicile, net of all credits
11allowed or (ii) a rate of zero if no such tax is imposed on such
12income by the foreign insurer's state of domicile. For the
13purposes of this subsection (d-1), an inter-affiliate includes
14a mutual insurer under common management.
15        (1) For the purposes of subsection (d-1), in no event
16    shall the sum of the rates of tax imposed by subsections
17    (b) and (d) be reduced below the rate at which the sum of:
18            (A) the total amount of tax imposed on such foreign
19        insurer under this Act for a taxable year, net of all
20        credits allowed under this Act, plus
21            (B) the privilege tax imposed by Section 409 of the
22        Illinois Insurance Code, the fire insurance company
23        tax imposed by Section 12 of the Fire Investigation
24        Act, and the fire department taxes imposed under
25        Section 11-10-1 of the Illinois Municipal Code,
26    equals 1.25% for taxable years ending prior to December 31,

 

 

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1    2003, or 1.75% for taxable years ending on or after
2    December 31, 2003, of the net taxable premiums written for
3    the taxable year, as described by subsection (1) of Section
4    409 of the Illinois Insurance Code. This paragraph will in
5    no event increase the rates imposed under subsections (b)
6    and (d).
7        (2) Any reduction in the rates of tax imposed by this
8    subsection shall be applied first against the rates imposed
9    by subsection (b) and only after the tax imposed by
10    subsection (a) net of all credits allowed under this
11    Section other than the credit allowed under subsection (i)
12    has been reduced to zero, against the rates imposed by
13    subsection (d).
14    This subsection (d-1) is exempt from the provisions of
15Section 250.
16    (e) Investment credit. A taxpayer shall be allowed a credit
17against the Personal Property Tax Replacement Income Tax for
18investment in qualified property.
19        (1) A taxpayer shall be allowed a credit equal to .5%
20    of the basis of qualified property placed in service during
21    the taxable year, provided such property is placed in
22    service on or after July 1, 1984. There shall be allowed an
23    additional credit equal to .5% of the basis of qualified
24    property placed in service during the taxable year,
25    provided such property is placed in service on or after
26    July 1, 1986, and the taxpayer's base employment within

 

 

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1    Illinois has increased by 1% or more over the preceding
2    year as determined by the taxpayer's employment records
3    filed with the Illinois Department of Employment Security.
4    Taxpayers who are new to Illinois shall be deemed to have
5    met the 1% growth in base employment for the first year in
6    which they file employment records with the Illinois
7    Department of Employment Security. The provisions added to
8    this Section by Public Act 85-1200 (and restored by Public
9    Act 87-895) shall be construed as declaratory of existing
10    law and not as a new enactment. If, in any year, the
11    increase in base employment within Illinois over the
12    preceding year is less than 1%, the additional credit shall
13    be limited to that percentage times a fraction, the
14    numerator of which is .5% and the denominator of which is
15    1%, but shall not exceed .5%. The investment credit shall
16    not be allowed to the extent that it would reduce a
17    taxpayer's liability in any tax year below zero, nor may
18    any credit for qualified property be allowed for any year
19    other than the year in which the property was placed in
20    service in Illinois. For tax years ending on or after
21    December 31, 1987, and on or before December 31, 1988, the
22    credit shall be allowed for the tax year in which the
23    property is placed in service, or, if the amount of the
24    credit exceeds the tax liability for that year, whether it
25    exceeds the original liability or the liability as later
26    amended, such excess may be carried forward and applied to

 

 

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1    the tax liability of the 5 taxable years following the
2    excess credit years if the taxpayer (i) makes investments
3    which cause the creation of a minimum of 2,000 full-time
4    equivalent jobs in Illinois, (ii) is located in an
5    enterprise zone established pursuant to the Illinois
6    Enterprise Zone Act and (iii) is certified by the
7    Department of Commerce and Community Affairs (now
8    Department of Commerce and Economic Opportunity) as
9    complying with the requirements specified in clause (i) and
10    (ii) by July 1, 1986. The Department of Commerce and
11    Community Affairs (now Department of Commerce and Economic
12    Opportunity) shall notify the Department of Revenue of all
13    such certifications immediately. For tax years ending
14    after December 31, 1988, the credit shall be allowed for
15    the tax year in which the property is placed in service,
16    or, if the amount of the credit exceeds the tax liability
17    for that year, whether it exceeds the original liability or
18    the liability as later amended, such excess may be carried
19    forward and applied to the tax liability of the 5 taxable
20    years following the excess credit years. The credit shall
21    be applied to the earliest year for which there is a
22    liability. If there is credit from more than one tax year
23    that is available to offset a liability, earlier credit
24    shall be applied first.
25        (2) The term "qualified property" means property
26    which:

 

 

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1            (A) is tangible, whether new or used, including
2        buildings and structural components of buildings and
3        signs that are real property, but not including land or
4        improvements to real property that are not a structural
5        component of a building such as landscaping, sewer
6        lines, local access roads, fencing, parking lots, and
7        other appurtenances;
8            (B) is depreciable pursuant to Section 167 of the
9        Internal Revenue Code, except that "3-year property"
10        as defined in Section 168(c)(2)(A) of that Code is not
11        eligible for the credit provided by this subsection
12        (e);
13            (C) is acquired by purchase as defined in Section
14        179(d) of the Internal Revenue Code;
15            (D) is used in Illinois by a taxpayer who is
16        primarily engaged in manufacturing, or in mining coal
17        or fluorite, or in retailing, or was placed in service
18        on or after July 1, 2006 in a River Edge Redevelopment
19        Zone established pursuant to the River Edge
20        Redevelopment Zone Act; and
21            (E) has not previously been used in Illinois in
22        such a manner and by such a person as would qualify for
23        the credit provided by this subsection (e) or
24        subsection (f).
25        (3) For purposes of this subsection (e),
26    "manufacturing" means the material staging and production

 

 

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1    of tangible personal property by procedures commonly
2    regarded as manufacturing, processing, fabrication, or
3    assembling which changes some existing material into new
4    shapes, new qualities, or new combinations. For purposes of
5    this subsection (e) the term "mining" shall have the same
6    meaning as the term "mining" in Section 613(c) of the
7    Internal Revenue Code. For purposes of this subsection (e),
8    the term "retailing" means the sale of tangible personal
9    property for use or consumption and not for resale, or
10    services rendered in conjunction with the sale of tangible
11    personal property for use or consumption and not for
12    resale. For purposes of this subsection (e), "tangible
13    personal property" has the same meaning as when that term
14    is used in the Retailers' Occupation Tax Act, and, for
15    taxable years ending after December 31, 2008, does not
16    include the generation, transmission, or distribution of
17    electricity.
18        (4) The basis of qualified property shall be the basis
19    used to compute the depreciation deduction for federal
20    income tax purposes.
21        (5) If the basis of the property for federal income tax
22    depreciation purposes is increased after it has been placed
23    in service in Illinois by the taxpayer, the amount of such
24    increase shall be deemed property placed in service on the
25    date of such increase in basis.
26        (6) The term "placed in service" shall have the same

 

 

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1    meaning as under Section 46 of the Internal Revenue Code.
2        (7) If during any taxable year, any property ceases to
3    be qualified property in the hands of the taxpayer within
4    48 months after being placed in service, or the situs of
5    any qualified property is moved outside Illinois within 48
6    months after being placed in service, the Personal Property
7    Tax Replacement Income Tax for such taxable year shall be
8    increased. Such increase shall be determined by (i)
9    recomputing the investment credit which would have been
10    allowed for the year in which credit for such property was
11    originally allowed by eliminating such property from such
12    computation and, (ii) subtracting such recomputed credit
13    from the amount of credit previously allowed. For the
14    purposes of this paragraph (7), a reduction of the basis of
15    qualified property resulting from a redetermination of the
16    purchase price shall be deemed a disposition of qualified
17    property to the extent of such reduction.
18        (8) Unless the investment credit is extended by law,
19    the basis of qualified property shall not include costs
20    incurred after December 31, 2018, except for costs incurred
21    pursuant to a binding contract entered into on or before
22    December 31, 2018.
23        (9) Each taxable year ending before December 31, 2000,
24    a partnership may elect to pass through to its partners the
25    credits to which the partnership is entitled under this
26    subsection (e) for the taxable year. A partner may use the

 

 

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1    credit allocated to him or her under this paragraph only
2    against the tax imposed in subsections (c) and (d) of this
3    Section. If the partnership makes that election, those
4    credits shall be allocated among the partners in the
5    partnership in accordance with the rules set forth in
6    Section 704(b) of the Internal Revenue Code, and the rules
7    promulgated under that Section, and the allocated amount of
8    the credits shall be allowed to the partners for that
9    taxable year. The partnership shall make this election on
10    its Personal Property Tax Replacement Income Tax return for
11    that taxable year. The election to pass through the credits
12    shall be irrevocable.
13        For taxable years ending on or after December 31, 2000,
14    a partner that qualifies its partnership for a subtraction
15    under subparagraph (I) of paragraph (2) of subsection (d)
16    of Section 203 or a shareholder that qualifies a Subchapter
17    S corporation for a subtraction under subparagraph (S) of
18    paragraph (2) of subsection (b) of Section 203 shall be
19    allowed a credit under this subsection (e) equal to its
20    share of the credit earned under this subsection (e) during
21    the taxable year by the partnership or Subchapter S
22    corporation, determined in accordance with the
23    determination of income and distributive share of income
24    under Sections 702 and 704 and Subchapter S of the Internal
25    Revenue Code. This paragraph is exempt from the provisions
26    of Section 250.

 

 

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1    (f) Investment credit; Enterprise Zone; River Edge
2Redevelopment Zone.
3        (1) A taxpayer shall be allowed a credit against the
4    tax imposed by subsections (a) and (b) of this Section for
5    investment in qualified property which is placed in service
6    in an Enterprise Zone created pursuant to the Illinois
7    Enterprise Zone Act or, for property placed in service on
8    or after July 1, 2006, a River Edge Redevelopment Zone
9    established pursuant to the River Edge Redevelopment Zone
10    Act. For partners, shareholders of Subchapter S
11    corporations, and owners of limited liability companies,
12    if the liability company is treated as a partnership for
13    purposes of federal and State income taxation, there shall
14    be allowed a credit under this subsection (f) to be
15    determined in accordance with the determination of income
16    and distributive share of income under Sections 702 and 704
17    and Subchapter S of the Internal Revenue Code. The credit
18    shall be .5% of the basis for such property. The credit
19    shall be available only in the taxable year in which the
20    property is placed in service in the Enterprise Zone or
21    River Edge Redevelopment Zone and shall not be allowed to
22    the extent that it would reduce a taxpayer's liability for
23    the tax imposed by subsections (a) and (b) of this Section
24    to below zero. For tax years ending on or after December
25    31, 1985, the credit shall be allowed for the tax year in
26    which the property is placed in service, or, if the amount

 

 

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1    of the credit exceeds the tax liability for that year,
2    whether it exceeds the original liability or the liability
3    as later amended, such excess may be carried forward and
4    applied to the tax liability of the 5 taxable years
5    following the excess credit year. The credit shall be
6    applied to the earliest year for which there is a
7    liability. If there is credit from more than one tax year
8    that is available to offset a liability, the credit
9    accruing first in time shall be applied first.
10        (2) The term qualified property means property which:
11            (A) is tangible, whether new or used, including
12        buildings and structural components of buildings;
13            (B) is depreciable pursuant to Section 167 of the
14        Internal Revenue Code, except that "3-year property"
15        as defined in Section 168(c)(2)(A) of that Code is not
16        eligible for the credit provided by this subsection
17        (f);
18            (C) is acquired by purchase as defined in Section
19        179(d) of the Internal Revenue Code;
20            (D) is used in the Enterprise Zone or River Edge
21        Redevelopment Zone by the taxpayer; and
22            (E) has not been previously used in Illinois in
23        such a manner and by such a person as would qualify for
24        the credit provided by this subsection (f) or
25        subsection (e).
26        (3) The basis of qualified property shall be the basis

 

 

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1    used to compute the depreciation deduction for federal
2    income tax purposes.
3        (4) If the basis of the property for federal income tax
4    depreciation purposes is increased after it has been placed
5    in service in the Enterprise Zone or River Edge
6    Redevelopment Zone by the taxpayer, the amount of such
7    increase shall be deemed property placed in service on the
8    date of such increase in basis.
9        (5) The term "placed in service" shall have the same
10    meaning as under Section 46 of the Internal Revenue Code.
11        (6) If during any taxable year, any property ceases to
12    be qualified property in the hands of the taxpayer within
13    48 months after being placed in service, or the situs of
14    any qualified property is moved outside the Enterprise Zone
15    or River Edge Redevelopment Zone within 48 months after
16    being placed in service, the tax imposed under subsections
17    (a) and (b) of this Section for such taxable year shall be
18    increased. Such increase shall be determined by (i)
19    recomputing the investment credit which would have been
20    allowed for the year in which credit for such property was
21    originally allowed by eliminating such property from such
22    computation, and (ii) subtracting such recomputed credit
23    from the amount of credit previously allowed. For the
24    purposes of this paragraph (6), a reduction of the basis of
25    qualified property resulting from a redetermination of the
26    purchase price shall be deemed a disposition of qualified

 

 

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1    property to the extent of such reduction.
2        (7) There shall be allowed an additional credit equal
3    to 0.5% of the basis of qualified property placed in
4    service during the taxable year in a River Edge
5    Redevelopment Zone, provided such property is placed in
6    service on or after July 1, 2006, and the taxpayer's base
7    employment within Illinois has increased by 1% or more over
8    the preceding year as determined by the taxpayer's
9    employment records filed with the Illinois Department of
10    Employment Security. Taxpayers who are new to Illinois
11    shall be deemed to have met the 1% growth in base
12    employment for the first year in which they file employment
13    records with the Illinois Department of Employment
14    Security. If, in any year, the increase in base employment
15    within Illinois over the preceding year is less than 1%,
16    the additional credit shall be limited to that percentage
17    times a fraction, the numerator of which is 0.5% and the
18    denominator of which is 1%, but shall not exceed 0.5%.
19    (g) (Blank).
20    (h) Investment credit; High Impact Business.
21        (1) Subject to subsections (b) and (b-5) of Section 5.5
22    of the Illinois Enterprise Zone Act, a taxpayer shall be
23    allowed a credit against the tax imposed by subsections (a)
24    and (b) of this Section for investment in qualified
25    property which is placed in service by a Department of
26    Commerce and Economic Opportunity designated High Impact

 

 

10000SB2672sam001- 20 -LRB100 17696 HLH 38557 a

1    Business. The credit shall be .5% of the basis for such
2    property. The credit shall not be available (i) until the
3    minimum investments in qualified property set forth in
4    subdivision (a)(3)(A) of Section 5.5 of the Illinois
5    Enterprise Zone Act have been satisfied or (ii) until the
6    time authorized in subsection (b-5) of the Illinois
7    Enterprise Zone Act for entities designated as High Impact
8    Businesses under subdivisions (a)(3)(B), (a)(3)(C), and
9    (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone
10    Act, and shall not be allowed to the extent that it would
11    reduce a taxpayer's liability for the tax imposed by
12    subsections (a) and (b) of this Section to below zero. The
13    credit applicable to such investments shall be taken in the
14    taxable year in which such investments have been completed.
15    The credit for additional investments beyond the minimum
16    investment by a designated high impact business authorized
17    under subdivision (a)(3)(A) of Section 5.5 of the Illinois
18    Enterprise Zone Act shall be available only in the taxable
19    year in which the property is placed in service and shall
20    not be allowed to the extent that it would reduce a
21    taxpayer's liability for the tax imposed by subsections (a)
22    and (b) of this Section to below zero. For tax years ending
23    on or after December 31, 1987, the credit shall be allowed
24    for the tax year in which the property is placed in
25    service, or, if the amount of the credit exceeds the tax
26    liability for that year, whether it exceeds the original

 

 

10000SB2672sam001- 21 -LRB100 17696 HLH 38557 a

1    liability or the liability as later amended, such excess
2    may be carried forward and applied to the tax liability of
3    the 5 taxable years following the excess credit year. The
4    credit shall be applied to the earliest year for which
5    there is a liability. If there is credit from more than one
6    tax year that is available to offset a liability, the
7    credit accruing first in time shall be applied first.
8        Changes made in this subdivision (h)(1) by Public Act
9    88-670 restore changes made by Public Act 85-1182 and
10    reflect existing law.
11        (2) The term qualified property means property which:
12            (A) is tangible, whether new or used, including
13        buildings and structural components of buildings;
14            (B) is depreciable pursuant to Section 167 of the
15        Internal Revenue Code, except that "3-year property"
16        as defined in Section 168(c)(2)(A) of that Code is not
17        eligible for the credit provided by this subsection
18        (h);
19            (C) is acquired by purchase as defined in Section
20        179(d) of the Internal Revenue Code; and
21            (D) is not eligible for the Enterprise Zone
22        Investment Credit provided by subsection (f) of this
23        Section.
24        (3) The basis of qualified property shall be the basis
25    used to compute the depreciation deduction for federal
26    income tax purposes.

 

 

10000SB2672sam001- 22 -LRB100 17696 HLH 38557 a

1        (4) If the basis of the property for federal income tax
2    depreciation purposes is increased after it has been placed
3    in service in a federally designated Foreign Trade Zone or
4    Sub-Zone located in Illinois by the taxpayer, the amount of
5    such increase shall be deemed property placed in service on
6    the date of such increase in basis.
7        (5) The term "placed in service" shall have the same
8    meaning as under Section 46 of the Internal Revenue Code.
9        (6) If during any taxable year ending on or before
10    December 31, 1996, any property ceases to be qualified
11    property in the hands of the taxpayer within 48 months
12    after being placed in service, or the situs of any
13    qualified property is moved outside Illinois within 48
14    months after being placed in service, the tax imposed under
15    subsections (a) and (b) of this Section for such taxable
16    year shall be increased. Such increase shall be determined
17    by (i) recomputing the investment credit which would have
18    been allowed for the year in which credit for such property
19    was originally allowed by eliminating such property from
20    such computation, and (ii) subtracting such recomputed
21    credit from the amount of credit previously allowed. For
22    the purposes of this paragraph (6), a reduction of the
23    basis of qualified property resulting from a
24    redetermination of the purchase price shall be deemed a
25    disposition of qualified property to the extent of such
26    reduction.

 

 

10000SB2672sam001- 23 -LRB100 17696 HLH 38557 a

1        (7) Beginning with tax years ending after December 31,
2    1996, if a taxpayer qualifies for the credit under this
3    subsection (h) and thereby is granted a tax abatement and
4    the taxpayer relocates its entire facility in violation of
5    the explicit terms and length of the contract under Section
6    18-183 of the Property Tax Code, the tax imposed under
7    subsections (a) and (b) of this Section shall be increased
8    for the taxable year in which the taxpayer relocated its
9    facility by an amount equal to the amount of credit
10    received by the taxpayer under this subsection (h).
11    (i) Credit for Personal Property Tax Replacement Income
12Tax. For tax years ending prior to December 31, 2003, a credit
13shall be allowed against the tax imposed by subsections (a) and
14(b) of this Section for the tax imposed by subsections (c) and
15(d) of this Section. This credit shall be computed by
16multiplying the tax imposed by subsections (c) and (d) of this
17Section by a fraction, the numerator of which is base income
18allocable to Illinois and the denominator of which is Illinois
19base income, and further multiplying the product by the tax
20rate imposed by subsections (a) and (b) of this Section.
21    Any credit earned on or after December 31, 1986 under this
22subsection which is unused in the year the credit is computed
23because it exceeds the tax liability imposed by subsections (a)
24and (b) for that year (whether it exceeds the original
25liability or the liability as later amended) may be carried
26forward and applied to the tax liability imposed by subsections

 

 

10000SB2672sam001- 24 -LRB100 17696 HLH 38557 a

1(a) and (b) of the 5 taxable years following the excess credit
2year, provided that no credit may be carried forward to any
3year ending on or after December 31, 2003. This credit shall be
4applied first to the earliest year for which there is a
5liability. If there is a credit under this subsection from more
6than one tax year that is available to offset a liability the
7earliest credit arising under this subsection shall be applied
8first.
9    If, during any taxable year ending on or after December 31,
101986, the tax imposed by subsections (c) and (d) of this
11Section for which a taxpayer has claimed a credit under this
12subsection (i) is reduced, the amount of credit for such tax
13shall also be reduced. Such reduction shall be determined by
14recomputing the credit to take into account the reduced tax
15imposed by subsections (c) and (d). If any portion of the
16reduced amount of credit has been carried to a different
17taxable year, an amended return shall be filed for such taxable
18year to reduce the amount of credit claimed.
19    (j) Training expense credit. Beginning with tax years
20ending on or after December 31, 1986 and prior to December 31,
212003, a taxpayer shall be allowed a credit against the tax
22imposed by subsections (a) and (b) under this Section for all
23amounts paid or accrued, on behalf of all persons employed by
24the taxpayer in Illinois or Illinois residents employed outside
25of Illinois by a taxpayer, for educational or vocational
26training in semi-technical or technical fields or semi-skilled

 

 

10000SB2672sam001- 25 -LRB100 17696 HLH 38557 a

1or skilled fields, which were deducted from gross income in the
2computation of taxable income. The credit against the tax
3imposed by subsections (a) and (b) shall be 1.6% of such
4training expenses. For partners, shareholders of subchapter S
5corporations, and owners of limited liability companies, if the
6liability company is treated as a partnership for purposes of
7federal and State income taxation, there shall be allowed a
8credit under this subsection (j) to be determined in accordance
9with the determination of income and distributive share of
10income under Sections 702 and 704 and subchapter S of the
11Internal Revenue Code.
12    Any credit allowed under this subsection which is unused in
13the year the credit is earned may be carried forward to each of
14the 5 taxable years following the year for which the credit is
15first computed until it is used. This credit shall be applied
16first to the earliest year for which there is a liability. If
17there is a credit under this subsection from more than one tax
18year that is available to offset a liability the earliest
19credit arising under this subsection shall be applied first. No
20carryforward credit may be claimed in any tax year ending on or
21after December 31, 2003.
22    (k) Research and development credit. For tax years ending
23after July 1, 1990 and prior to December 31, 2003, and
24beginning again for tax years ending on or after December 31,
252004, and ending prior to January 1, 2022, a taxpayer shall be
26allowed a credit against the tax imposed by subsections (a) and

 

 

10000SB2672sam001- 26 -LRB100 17696 HLH 38557 a

1(b) of this Section for increasing research activities in this
2State. The credit allowed against the tax imposed by
3subsections (a) and (b) shall be equal to 6 1/2% of the
4qualifying expenditures for increasing research activities in
5this State. For partners, shareholders of subchapter S
6corporations, and owners of limited liability companies, if the
7liability company is treated as a partnership for purposes of
8federal and State income taxation, there shall be allowed a
9credit under this subsection to be determined in accordance
10with the determination of income and distributive share of
11income under Sections 702 and 704 and subchapter S of the
12Internal Revenue Code.
13    For purposes of this subsection, "qualifying expenditures"
14means the qualifying expenditures as defined for the federal
15credit for increasing research activities which would be
16allowable under Section 41 of the Internal Revenue Code and
17which are conducted in this State, "qualifying expenditures for
18increasing research activities in this State" means the excess
19of qualifying expenditures for the taxable year in which
20incurred over qualifying expenditures for the base period,
21"qualifying expenditures for the base period" means the average
22of the qualifying expenditures for each year in the base
23period, and "base period" means the 3 taxable years immediately
24preceding the taxable year for which the determination is being
25made.
26    Any credit in excess of the tax liability for the taxable

 

 

10000SB2672sam001- 27 -LRB100 17696 HLH 38557 a

1year may be carried forward. A taxpayer may elect to have the
2unused credit shown on its final completed return carried over
3as a credit against the tax liability for the following 5
4taxable years or until it has been fully used, whichever occurs
5first; provided that no credit earned in a tax year ending
6prior to December 31, 2003 may be carried forward to any year
7ending on or after December 31, 2003.
8    If an unused credit is carried forward to a given year from
92 or more earlier years, that credit arising in the earliest
10year will be applied first against the tax liability for the
11given year. If a tax liability for the given year still
12remains, the credit from the next earliest year will then be
13applied, and so on, until all credits have been used or no tax
14liability for the given year remains. Any remaining unused
15credit or credits then will be carried forward to the next
16following year in which a tax liability is incurred, except
17that no credit can be carried forward to a year which is more
18than 5 years after the year in which the expense for which the
19credit is given was incurred.
20    No inference shall be drawn from this amendatory Act of the
2191st General Assembly in construing this Section for taxable
22years beginning before January 1, 1999.
23    It is the intent of the General Assembly that the research
24and development credit under this subsection (k) shall apply
25continuously for all tax years ending on or after December 31,
262004 and ending prior to January 1, 2022, including, but not

 

 

10000SB2672sam001- 28 -LRB100 17696 HLH 38557 a

1limited to, the period beginning on January 1, 2016 and ending
2on the effective date of this amendatory Act of the 100th
3General Assembly. All actions taken in reliance on the
4continuation of the credit under this subsection (k) by any
5taxpayer are hereby validated.
6    (l) Environmental Remediation Tax Credit.
7        (i) For tax years ending after December 31, 1997 and on
8    or before December 31, 2001, a taxpayer shall be allowed a
9    credit against the tax imposed by subsections (a) and (b)
10    of this Section for certain amounts paid for unreimbursed
11    eligible remediation costs, as specified in this
12    subsection. For purposes of this Section, "unreimbursed
13    eligible remediation costs" means costs approved by the
14    Illinois Environmental Protection Agency ("Agency") under
15    Section 58.14 of the Environmental Protection Act that were
16    paid in performing environmental remediation at a site for
17    which a No Further Remediation Letter was issued by the
18    Agency and recorded under Section 58.10 of the
19    Environmental Protection Act. The credit must be claimed
20    for the taxable year in which Agency approval of the
21    eligible remediation costs is granted. The credit is not
22    available to any taxpayer if the taxpayer or any related
23    party caused or contributed to, in any material respect, a
24    release of regulated substances on, in, or under the site
25    that was identified and addressed by the remedial action
26    pursuant to the Site Remediation Program of the

 

 

10000SB2672sam001- 29 -LRB100 17696 HLH 38557 a

1    Environmental Protection Act. After the Pollution Control
2    Board rules are adopted pursuant to the Illinois
3    Administrative Procedure Act for the administration and
4    enforcement of Section 58.9 of the Environmental
5    Protection Act, determinations as to credit availability
6    for purposes of this Section shall be made consistent with
7    those rules. For purposes of this Section, "taxpayer"
8    includes a person whose tax attributes the taxpayer has
9    succeeded to under Section 381 of the Internal Revenue Code
10    and "related party" includes the persons disallowed a
11    deduction for losses by paragraphs (b), (c), and (f)(1) of
12    Section 267 of the Internal Revenue Code by virtue of being
13    a related taxpayer, as well as any of its partners. The
14    credit allowed against the tax imposed by subsections (a)
15    and (b) shall be equal to 25% of the unreimbursed eligible
16    remediation costs in excess of $100,000 per site, except
17    that the $100,000 threshold shall not apply to any site
18    contained in an enterprise zone as determined by the
19    Department of Commerce and Community Affairs (now
20    Department of Commerce and Economic Opportunity). The
21    total credit allowed shall not exceed $40,000 per year with
22    a maximum total of $150,000 per site. For partners and
23    shareholders of subchapter S corporations, there shall be
24    allowed a credit under this subsection to be determined in
25    accordance with the determination of income and
26    distributive share of income under Sections 702 and 704 and

 

 

10000SB2672sam001- 30 -LRB100 17696 HLH 38557 a

1    subchapter S of the Internal Revenue Code.
2        (ii) A credit allowed under this subsection that is
3    unused in the year the credit is earned may be carried
4    forward to each of the 5 taxable years following the year
5    for which the credit is first earned until it is used. The
6    term "unused credit" does not include any amounts of
7    unreimbursed eligible remediation costs in excess of the
8    maximum credit per site authorized under paragraph (i).
9    This credit shall be applied first to the earliest year for
10    which there is a liability. If there is a credit under this
11    subsection from more than one tax year that is available to
12    offset a liability, the earliest credit arising under this
13    subsection shall be applied first. A credit allowed under
14    this subsection may be sold to a buyer as part of a sale of
15    all or part of the remediation site for which the credit
16    was granted. The purchaser of a remediation site and the
17    tax credit shall succeed to the unused credit and remaining
18    carry-forward period of the seller. To perfect the
19    transfer, the assignor shall record the transfer in the
20    chain of title for the site and provide written notice to
21    the Director of the Illinois Department of Revenue of the
22    assignor's intent to sell the remediation site and the
23    amount of the tax credit to be transferred as a portion of
24    the sale. In no event may a credit be transferred to any
25    taxpayer if the taxpayer or a related party would not be
26    eligible under the provisions of subsection (i).

 

 

10000SB2672sam001- 31 -LRB100 17696 HLH 38557 a

1        (iii) For purposes of this Section, the term "site"
2    shall have the same meaning as under Section 58.2 of the
3    Environmental Protection Act.
4    (m) Education expense credit. Beginning with tax years
5ending after December 31, 1999, a taxpayer who is the custodian
6of one or more qualifying pupils shall be allowed a credit
7against the tax imposed by subsections (a) and (b) of this
8Section for qualified education expenses incurred on behalf of
9the qualifying pupils. The credit shall be equal to 25% of
10qualified education expenses, but in no event may the total
11credit under this subsection claimed by a family that is the
12custodian of qualifying pupils exceed (i) $500 for tax years
13ending prior to December 31, 2017, and (ii) $750 for tax years
14ending on or after December 31, 2017. In no event shall a
15credit under this subsection reduce the taxpayer's liability
16under this Act to less than zero. Notwithstanding any other
17provision of law, for taxable years beginning on or after
18January 1, 2017, no taxpayer may claim a credit under this
19subsection (m) if the taxpayer's adjusted gross income for the
20taxable year exceeds (i) $500,000, in the case of spouses
21filing a joint federal tax return or (ii) $250,000, in the case
22of all other taxpayers. This subsection is exempt from the
23provisions of Section 250 of this Act.
24    For purposes of this subsection:
25    "Qualifying pupils" means individuals who (i) are
26residents of the State of Illinois, (ii) are under the age of

 

 

10000SB2672sam001- 32 -LRB100 17696 HLH 38557 a

121 at the close of the school year for which a credit is
2sought, and (iii) during the school year for which a credit is
3sought were full-time pupils enrolled in a kindergarten through
4twelfth grade education program at any school, as defined in
5this subsection.
6    "Qualified education expense" means the amount incurred on
7behalf of a qualifying pupil in excess of $250 for tuition,
8book fees, and lab fees at the school in which the pupil is
9enrolled during the regular school year.
10    "School" means any public or nonpublic elementary or
11secondary school in Illinois that is in compliance with Title
12VI of the Civil Rights Act of 1964 and attendance at which
13satisfies the requirements of Section 26-1 of the School Code,
14except that nothing shall be construed to require a child to
15attend any particular public or nonpublic school to qualify for
16the credit under this Section.
17    "Custodian" means, with respect to qualifying pupils, an
18Illinois resident who is a parent, the parents, a legal
19guardian, or the legal guardians of the qualifying pupils.
20    (n) River Edge Redevelopment Zone site remediation tax
21credit.
22        (i) For tax years ending on or after December 31, 2006,
23    a taxpayer shall be allowed a credit against the tax
24    imposed by subsections (a) and (b) of this Section for
25    certain amounts paid for unreimbursed eligible remediation
26    costs, as specified in this subsection. For purposes of

 

 

10000SB2672sam001- 33 -LRB100 17696 HLH 38557 a

1    this Section, "unreimbursed eligible remediation costs"
2    means costs approved by the Illinois Environmental
3    Protection Agency ("Agency") under Section 58.14a of the
4    Environmental Protection Act that were paid in performing
5    environmental remediation at a site within a River Edge
6    Redevelopment Zone for which a No Further Remediation
7    Letter was issued by the Agency and recorded under Section
8    58.10 of the Environmental Protection Act. The credit must
9    be claimed for the taxable year in which Agency approval of
10    the eligible remediation costs is granted. The credit is
11    not available to any taxpayer if the taxpayer or any
12    related party caused or contributed to, in any material
13    respect, a release of regulated substances on, in, or under
14    the site that was identified and addressed by the remedial
15    action pursuant to the Site Remediation Program of the
16    Environmental Protection Act. Determinations as to credit
17    availability for purposes of this Section shall be made
18    consistent with rules adopted by the Pollution Control
19    Board pursuant to the Illinois Administrative Procedure
20    Act for the administration and enforcement of Section 58.9
21    of the Environmental Protection Act. For purposes of this
22    Section, "taxpayer" includes a person whose tax attributes
23    the taxpayer has succeeded to under Section 381 of the
24    Internal Revenue Code and "related party" includes the
25    persons disallowed a deduction for losses by paragraphs
26    (b), (c), and (f)(1) of Section 267 of the Internal Revenue

 

 

10000SB2672sam001- 34 -LRB100 17696 HLH 38557 a

1    Code by virtue of being a related taxpayer, as well as any
2    of its partners. The credit allowed against the tax imposed
3    by subsections (a) and (b) shall be equal to 25% of the
4    unreimbursed eligible remediation costs in excess of
5    $100,000 per site.
6        (ii) A credit allowed under this subsection that is
7    unused in the year the credit is earned may be carried
8    forward to each of the 5 taxable years following the year
9    for which the credit is first earned until it is used. This
10    credit shall be applied first to the earliest year for
11    which there is a liability. If there is a credit under this
12    subsection from more than one tax year that is available to
13    offset a liability, the earliest credit arising under this
14    subsection shall be applied first. A credit allowed under
15    this subsection may be sold to a buyer as part of a sale of
16    all or part of the remediation site for which the credit
17    was granted. The purchaser of a remediation site and the
18    tax credit shall succeed to the unused credit and remaining
19    carry-forward period of the seller. To perfect the
20    transfer, the assignor shall record the transfer in the
21    chain of title for the site and provide written notice to
22    the Director of the Illinois Department of Revenue of the
23    assignor's intent to sell the remediation site and the
24    amount of the tax credit to be transferred as a portion of
25    the sale. In no event may a credit be transferred to any
26    taxpayer if the taxpayer or a related party would not be

 

 

10000SB2672sam001- 35 -LRB100 17696 HLH 38557 a

1    eligible under the provisions of subsection (i).
2        (iii) For purposes of this Section, the term "site"
3    shall have the same meaning as under Section 58.2 of the
4    Environmental Protection Act.
5    (o) For each of taxable years during the Compassionate Use
6of Medical Cannabis Pilot Program, a surcharge is imposed on
7all taxpayers on income arising from the sale or exchange of
8capital assets, depreciable business property, real property
9used in the trade or business, and Section 197 intangibles of
10an organization registrant under the Compassionate Use of
11Medical Cannabis Pilot Program Act. The amount of the surcharge
12is equal to the amount of federal income tax liability for the
13taxable year attributable to those sales and exchanges. The
14surcharge imposed does not apply if:
15        (1) the medical cannabis cultivation center
16    registration, medical cannabis dispensary registration, or
17    the property of a registration is transferred as a result
18    of any of the following:
19            (A) bankruptcy, a receivership, or a debt
20        adjustment initiated by or against the initial
21        registration or the substantial owners of the initial
22        registration;
23            (B) cancellation, revocation, or termination of
24        any registration by the Illinois Department of Public
25        Health;
26            (C) a determination by the Illinois Department of

 

 

10000SB2672sam001- 36 -LRB100 17696 HLH 38557 a

1        Public Health that transfer of the registration is in
2        the best interests of Illinois qualifying patients as
3        defined by the Compassionate Use of Medical Cannabis
4        Pilot Program Act;
5            (D) the death of an owner of the equity interest in
6        a registrant;
7            (E) the acquisition of a controlling interest in
8        the stock or substantially all of the assets of a
9        publicly traded company;
10            (F) a transfer by a parent company to a wholly
11        owned subsidiary; or
12            (G) the transfer or sale to or by one person to
13        another person where both persons were initial owners
14        of the registration when the registration was issued;
15        or
16        (2) the cannabis cultivation center registration,
17    medical cannabis dispensary registration, or the
18    controlling interest in a registrant's property is
19    transferred in a transaction to lineal descendants in which
20    no gain or loss is recognized or as a result of a
21    transaction in accordance with Section 351 of the Internal
22    Revenue Code in which no gain or loss is recognized.
23(Source: P.A. 100-22, eff. 7-6-17.)
 
24    (35 ILCS 5/901)  (from Ch. 120, par. 9-901)
25    Sec. 901. Collection authority.

 

 

10000SB2672sam001- 37 -LRB100 17696 HLH 38557 a

1    (a) In general. The Department shall collect the taxes
2imposed by this Act. The Department shall collect certified
3past due child support amounts under Section 2505-650 of the
4Department of Revenue Law of the Civil Administrative Code of
5Illinois. Except as provided in subsections (b), (c), (e), (f),
6(g), and (h) of this Section, money collected pursuant to
7subsections (a) and (b) of Section 201 of this Act shall be
8paid into the General Revenue Fund in the State treasury; money
9collected pursuant to subsections (c) and (d) of Section 201 of
10this Act shall be paid into the Personal Property Tax
11Replacement Fund, a special fund in the State Treasury; and
12money collected under Section 2505-650 of the Department of
13Revenue Law of the Civil Administrative Code of Illinois (20
14ILCS 2505/2505-650) shall be paid into the Child Support
15Enforcement Trust Fund, a special fund outside the State
16Treasury, or to the State Disbursement Unit established under
17Section 10-26 of the Illinois Public Aid Code, as directed by
18the Department of Healthcare and Family Services.
19    (b) Local Government Distributive Fund. Beginning August
201, 1969, and continuing through June 30, 1994, the Treasurer
21shall transfer each month from the General Revenue Fund to a
22special fund in the State treasury, to be known as the "Local
23Government Distributive Fund", an amount equal to 1/12 of the
24net revenue realized from the tax imposed by subsections (a)
25and (b) of Section 201 of this Act during the preceding month.
26Beginning July 1, 1994, and continuing through June 30, 1995,

 

 

10000SB2672sam001- 38 -LRB100 17696 HLH 38557 a

1the Treasurer shall transfer each month from the General
2Revenue Fund to the Local Government Distributive Fund an
3amount equal to 1/11 of the net revenue realized from the tax
4imposed by subsections (a) and (b) of Section 201 of this Act
5during the preceding month. Beginning July 1, 1995 and
6continuing through January 31, 2011, the Treasurer shall
7transfer each month from the General Revenue Fund to the Local
8Government Distributive Fund an amount equal to the net of (i)
91/10 of the net revenue realized from the tax imposed by
10subsections (a) and (b) of Section 201 of the Illinois Income
11Tax Act during the preceding month (ii) minus, beginning July
121, 2003 and ending June 30, 2004, $6,666,666, and beginning
13July 1, 2004, zero. Beginning February 1, 2011, and continuing
14through January 31, 2015, the Treasurer shall transfer each
15month from the General Revenue Fund to the Local Government
16Distributive Fund an amount equal to the sum of (i) 6% (10% of
17the ratio of the 3% individual income tax rate prior to 2011 to
18the 5% individual income tax rate after 2010) of the net
19revenue realized from the tax imposed by subsections (a) and
20(b) of Section 201 of this Act upon individuals, trusts, and
21estates during the preceding month and (ii) 6.86% (10% of the
22ratio of the 4.8% corporate income tax rate prior to 2011 to
23the 7% corporate income tax rate after 2010) of the net revenue
24realized from the tax imposed by subsections (a) and (b) of
25Section 201 of this Act upon corporations during the preceding
26month. Beginning February 1, 2015 and continuing through July

 

 

10000SB2672sam001- 39 -LRB100 17696 HLH 38557 a

131, 2017, the Treasurer shall transfer each month from the
2General Revenue Fund to the Local Government Distributive Fund
3an amount equal to the sum of (i) 8% (10% of the ratio of the 3%
4individual income tax rate prior to 2011 to the 3.75%
5individual income tax rate after 2014) of the net revenue
6realized from the tax imposed by subsections (a) and (b) of
7Section 201 of this Act upon individuals, trusts, and estates
8during the preceding month and (ii) 9.14% (10% of the ratio of
9the 4.8% corporate income tax rate prior to 2011 to the 5.25%
10corporate income tax rate after 2014) of the net revenue
11realized from the tax imposed by subsections (a) and (b) of
12Section 201 of this Act upon corporations during the preceding
13month. Beginning August 1, 2017, and continuing through the
14first July 31 after the first July 1 following the commencement
15of the pension benefit election procedures established
16pursuant to Sections 14-106.5, 15-132.9, 16-122.9, and
1717-115.5 of the Illinois Pension Code as added by Senate Bill
1816 of the 100th General Assembly, the Treasurer shall transfer
19each month from the General Revenue Fund to the Local
20Government Distributive Fund an amount equal to the sum of (i)
216.06% (10% of the ratio of the 3% individual income tax rate
22prior to 2011 to the 4.95% individual income tax rate after
23June 30, 2017 July 1, 2017) of the net revenue realized from
24the tax imposed by subsections (a) and (b) of Section 201 of
25this Act upon individuals, trusts, and estates during the
26preceding month and (ii) 6.85% (10% of the ratio of the 4.8%

 

 

10000SB2672sam001- 40 -LRB100 17696 HLH 38557 a

1corporate income tax rate prior to 2011 to the 7% corporate
2income tax rate after June 30, 2017 July 1, 2017) of the net
3revenue realized from the tax imposed by subsections (a) and
4(b) of Section 201 of this Act upon corporations during the
5preceding month. Beginning on the first August 1 after the
6first July 1 following the commencement of the pension benefit
7election procedures established pursuant to Sections 14-106.5,
815-132.9, 16-122.9, and 17-115.5 of the Illinois Pension Code
9as added by Senate Bill 16 of the 100th General Assembly, the
10Treasurer shall transfer each month from the General Revenue
11Fund to the Local Government Distributive Fund an amount equal
12to the sum of (i) 6.3829% (10% of the ratio of the 3%
13individual income tax rate prior to 2011 to the 4.7% individual
14income tax rate after the first June 30 following the
15commencement of the pension benefit election procedures
16established pursuant to Sections 14-106.5, 15-132.9, 16-122.9,
17and 17-115.5 of the Illinois Pension Code as added by Senate
18Bill 16 of the 100th General Assembly) of the net revenue
19realized from the tax imposed by subsections (a) and (b) of
20Section 201 of this Act upon individuals, trusts, and estates
21during the preceding month and (ii) 6.85% (10% of the ratio of
22the 4.8% corporate income tax rate prior to 2011 to the 7%
23corporate income tax rate after June 30, 2017) of the net
24revenue realized from the tax imposed by subsections (a) and
25(b) of Section 201 of this Act upon corporations during the
26preceding month. Net revenue realized for a month shall be

 

 

10000SB2672sam001- 41 -LRB100 17696 HLH 38557 a

1defined as the revenue from the tax imposed by subsections (a)
2and (b) of Section 201 of this Act which is deposited in the
3General Revenue Fund, the Education Assistance Fund, the Income
4Tax Surcharge Local Government Distributive Fund, the Fund for
5the Advancement of Education, and the Commitment to Human
6Services Fund during the month minus the amount paid out of the
7General Revenue Fund in State warrants during that same month
8as refunds to taxpayers for overpayment of liability under the
9tax imposed by subsections (a) and (b) of Section 201 of this
10Act.
11    Notwithstanding any provision of law to the contrary,
12beginning on July 6, 2017 (the effective date of Public Act
13100-23) this amendatory Act of the 100th General Assembly,
14those amounts required under this subsection (b) to be
15transferred by the Treasurer into the Local Government
16Distributive Fund from the General Revenue Fund shall be
17directly deposited into the Local Government Distributive Fund
18as the revenue is realized from the tax imposed by subsections
19(a) and (b) of Section 201 of this Act.
20    For State fiscal year 2018 only, notwithstanding any
21provision of law to the contrary, the total amount of revenue
22and deposits under this Section attributable to revenues
23realized during State fiscal year 2018 shall be reduced by 10%.
24    (c) Deposits Into Income Tax Refund Fund.
25        (1) Beginning on January 1, 1989 and thereafter, the
26    Department shall deposit a percentage of the amounts

 

 

10000SB2672sam001- 42 -LRB100 17696 HLH 38557 a

1    collected pursuant to subsections (a) and (b)(1), (2), and
2    (3), of Section 201 of this Act into a fund in the State
3    treasury known as the Income Tax Refund Fund. The
4    Department shall deposit 6% of such amounts during the
5    period beginning January 1, 1989 and ending on June 30,
6    1989. Beginning with State fiscal year 1990 and for each
7    fiscal year thereafter, the percentage deposited into the
8    Income Tax Refund Fund during a fiscal year shall be the
9    Annual Percentage. For fiscal years 1999 through 2001, the
10    Annual Percentage shall be 7.1%. For fiscal year 2003, the
11    Annual Percentage shall be 8%. For fiscal year 2004, the
12    Annual Percentage shall be 11.7%. Upon the effective date
13    of Public Act 93-839 (July 30, 2004) this amendatory Act of
14    the 93rd General Assembly, the Annual Percentage shall be
15    10% for fiscal year 2005. For fiscal year 2006, the Annual
16    Percentage shall be 9.75%. For fiscal year 2007, the Annual
17    Percentage shall be 9.75%. For fiscal year 2008, the Annual
18    Percentage shall be 7.75%. For fiscal year 2009, the Annual
19    Percentage shall be 9.75%. For fiscal year 2010, the Annual
20    Percentage shall be 9.75%. For fiscal year 2011, the Annual
21    Percentage shall be 8.75%. For fiscal year 2012, the Annual
22    Percentage shall be 8.75%. For fiscal year 2013, the Annual
23    Percentage shall be 9.75%. For fiscal year 2014, the Annual
24    Percentage shall be 9.5%. For fiscal year 2015, the Annual
25    Percentage shall be 10%. For fiscal year 2018, the Annual
26    Percentage shall be 9.8%. For all other fiscal years, the

 

 

10000SB2672sam001- 43 -LRB100 17696 HLH 38557 a

1    Annual Percentage shall be calculated as a fraction, the
2    numerator of which shall be the amount of refunds approved
3    for payment by the Department during the preceding fiscal
4    year as a result of overpayment of tax liability under
5    subsections (a) and (b)(1), (2), and (3) of Section 201 of
6    this Act plus the amount of such refunds remaining approved
7    but unpaid at the end of the preceding fiscal year, minus
8    the amounts transferred into the Income Tax Refund Fund
9    from the Tobacco Settlement Recovery Fund, and the
10    denominator of which shall be the amounts which will be
11    collected pursuant to subsections (a) and (b)(1), (2), and
12    (3) of Section 201 of this Act during the preceding fiscal
13    year; except that in State fiscal year 2002, the Annual
14    Percentage shall in no event exceed 7.6%. The Director of
15    Revenue shall certify the Annual Percentage to the
16    Comptroller on the last business day of the fiscal year
17    immediately preceding the fiscal year for which it is to be
18    effective.
19        (2) Beginning on January 1, 1989 and thereafter, the
20    Department shall deposit a percentage of the amounts
21    collected pursuant to subsections (a) and (b)(6), (7), and
22    (8), (c) and (d) of Section 201 of this Act into a fund in
23    the State treasury known as the Income Tax Refund Fund. The
24    Department shall deposit 18% of such amounts during the
25    period beginning January 1, 1989 and ending on June 30,
26    1989. Beginning with State fiscal year 1990 and for each

 

 

10000SB2672sam001- 44 -LRB100 17696 HLH 38557 a

1    fiscal year thereafter, the percentage deposited into the
2    Income Tax Refund Fund during a fiscal year shall be the
3    Annual Percentage. For fiscal years 1999, 2000, and 2001,
4    the Annual Percentage shall be 19%. For fiscal year 2003,
5    the Annual Percentage shall be 27%. For fiscal year 2004,
6    the Annual Percentage shall be 32%. Upon the effective date
7    of Public Act 93-839 (July 30, 2004) this amendatory Act of
8    the 93rd General Assembly, the Annual Percentage shall be
9    24% for fiscal year 2005. For fiscal year 2006, the Annual
10    Percentage shall be 20%. For fiscal year 2007, the Annual
11    Percentage shall be 17.5%. For fiscal year 2008, the Annual
12    Percentage shall be 15.5%. For fiscal year 2009, the Annual
13    Percentage shall be 17.5%. For fiscal year 2010, the Annual
14    Percentage shall be 17.5%. For fiscal year 2011, the Annual
15    Percentage shall be 17.5%. For fiscal year 2012, the Annual
16    Percentage shall be 17.5%. For fiscal year 2013, the Annual
17    Percentage shall be 14%. For fiscal year 2014, the Annual
18    Percentage shall be 13.4%. For fiscal year 2015, the Annual
19    Percentage shall be 14%. For fiscal year 2018, the Annual
20    Percentage shall be 17.5%. For all other fiscal years, the
21    Annual Percentage shall be calculated as a fraction, the
22    numerator of which shall be the amount of refunds approved
23    for payment by the Department during the preceding fiscal
24    year as a result of overpayment of tax liability under
25    subsections (a) and (b)(6), (7), and (8), (c) and (d) of
26    Section 201 of this Act plus the amount of such refunds

 

 

10000SB2672sam001- 45 -LRB100 17696 HLH 38557 a

1    remaining approved but unpaid at the end of the preceding
2    fiscal year, and the denominator of which shall be the
3    amounts which will be collected pursuant to subsections (a)
4    and (b)(6), (7), and (8), (c) and (d) of Section 201 of
5    this Act during the preceding fiscal year; except that in
6    State fiscal year 2002, the Annual Percentage shall in no
7    event exceed 23%. The Director of Revenue shall certify the
8    Annual Percentage to the Comptroller on the last business
9    day of the fiscal year immediately preceding the fiscal
10    year for which it is to be effective.
11        (3) The Comptroller shall order transferred and the
12    Treasurer shall transfer from the Tobacco Settlement
13    Recovery Fund to the Income Tax Refund Fund (i) $35,000,000
14    in January, 2001, (ii) $35,000,000 in January, 2002, and
15    (iii) $35,000,000 in January, 2003.
16    (d) Expenditures from Income Tax Refund Fund.
17        (1) Beginning January 1, 1989, money in the Income Tax
18    Refund Fund shall be expended exclusively for the purpose
19    of paying refunds resulting from overpayment of tax
20    liability under Section 201 of this Act, for paying rebates
21    under Section 208.1 in the event that the amounts in the
22    Homeowners' Tax Relief Fund are insufficient for that
23    purpose, and for making transfers pursuant to this
24    subsection (d).
25        (2) The Director shall order payment of refunds
26    resulting from overpayment of tax liability under Section

 

 

10000SB2672sam001- 46 -LRB100 17696 HLH 38557 a

1    201 of this Act from the Income Tax Refund Fund only to the
2    extent that amounts collected pursuant to Section 201 of
3    this Act and transfers pursuant to this subsection (d) and
4    item (3) of subsection (c) have been deposited and retained
5    in the Fund.
6        (3) As soon as possible after the end of each fiscal
7    year, the Director shall order transferred and the State
8    Treasurer and State Comptroller shall transfer from the
9    Income Tax Refund Fund to the Personal Property Tax
10    Replacement Fund an amount, certified by the Director to
11    the Comptroller, equal to the excess of the amount
12    collected pursuant to subsections (c) and (d) of Section
13    201 of this Act deposited into the Income Tax Refund Fund
14    during the fiscal year over the amount of refunds resulting
15    from overpayment of tax liability under subsections (c) and
16    (d) of Section 201 of this Act paid from the Income Tax
17    Refund Fund during the fiscal year.
18        (4) As soon as possible after the end of each fiscal
19    year, the Director shall order transferred and the State
20    Treasurer and State Comptroller shall transfer from the
21    Personal Property Tax Replacement Fund to the Income Tax
22    Refund Fund an amount, certified by the Director to the
23    Comptroller, equal to the excess of the amount of refunds
24    resulting from overpayment of tax liability under
25    subsections (c) and (d) of Section 201 of this Act paid
26    from the Income Tax Refund Fund during the fiscal year over

 

 

10000SB2672sam001- 47 -LRB100 17696 HLH 38557 a

1    the amount collected pursuant to subsections (c) and (d) of
2    Section 201 of this Act deposited into the Income Tax
3    Refund Fund during the fiscal year.
4        (4.5) As soon as possible after the end of fiscal year
5    1999 and of each fiscal year thereafter, the Director shall
6    order transferred and the State Treasurer and State
7    Comptroller shall transfer from the Income Tax Refund Fund
8    to the General Revenue Fund any surplus remaining in the
9    Income Tax Refund Fund as of the end of such fiscal year;
10    excluding for fiscal years 2000, 2001, and 2002 amounts
11    attributable to transfers under item (3) of subsection (c)
12    less refunds resulting from the earned income tax credit.
13        (5) This Act shall constitute an irrevocable and
14    continuing appropriation from the Income Tax Refund Fund
15    for the purpose of paying refunds upon the order of the
16    Director in accordance with the provisions of this Section.
17    (e) Deposits into the Education Assistance Fund and the
18Income Tax Surcharge Local Government Distributive Fund. On
19July 1, 1991, and thereafter, of the amounts collected pursuant
20to subsections (a) and (b) of Section 201 of this Act, minus
21deposits into the Income Tax Refund Fund, the Department shall
22deposit 7.3% into the Education Assistance Fund in the State
23Treasury. Beginning July 1, 1991, and continuing through
24January 31, 1993, of the amounts collected pursuant to
25subsections (a) and (b) of Section 201 of the Illinois Income
26Tax Act, minus deposits into the Income Tax Refund Fund, the

 

 

10000SB2672sam001- 48 -LRB100 17696 HLH 38557 a

1Department shall deposit 3.0% into the Income Tax Surcharge
2Local Government Distributive Fund in the State Treasury.
3Beginning February 1, 1993 and continuing through June 30,
41993, of the amounts collected pursuant to subsections (a) and
5(b) of Section 201 of the Illinois Income Tax Act, minus
6deposits into the Income Tax Refund Fund, the Department shall
7deposit 4.4% into the Income Tax Surcharge Local Government
8Distributive Fund in the State Treasury. Beginning July 1,
91993, and continuing through June 30, 1994, of the amounts
10collected under subsections (a) and (b) of Section 201 of this
11Act, minus deposits into the Income Tax Refund Fund, the
12Department shall deposit 1.475% into the Income Tax Surcharge
13Local Government Distributive Fund in the State Treasury.
14    (f) Deposits into the Fund for the Advancement of
15Education. Beginning February 1, 2015, the Department shall
16deposit the following portions of the revenue realized from the
17tax imposed upon individuals, trusts, and estates by
18subsections (a) and (b) of Section 201 of this Act during the
19preceding month, minus deposits into the Income Tax Refund
20Fund, into the Fund for the Advancement of Education:
21        (1) beginning February 1, 2015, and prior to February
22    1, 2025, 1/30; and
23        (2) beginning February 1, 2025, 1/26.
24    If the rate of tax imposed by subsection (a) and (b) of
25Section 201 is reduced pursuant to Section 201.5 of this Act,
26the Department shall not make the deposits required by this

 

 

10000SB2672sam001- 49 -LRB100 17696 HLH 38557 a

1subsection (f) on or after the effective date of the reduction.
2    (g) Deposits into the Commitment to Human Services Fund.
3Beginning February 1, 2015, the Department shall deposit the
4following portions of the revenue realized from the tax imposed
5upon individuals, trusts, and estates by subsections (a) and
6(b) of Section 201 of this Act during the preceding month,
7minus deposits into the Income Tax Refund Fund, into the
8Commitment to Human Services Fund:
9        (1) beginning February 1, 2015, and prior to February
10    1, 2025, 1/30; and
11        (2) beginning February 1, 2025, 1/26.
12    If the rate of tax imposed by subsection (a) and (b) of
13Section 201 is reduced pursuant to Section 201.5 of this Act,
14the Department shall not make the deposits required by this
15subsection (g) on or after the effective date of the reduction.
16    (h) Deposits into the Tax Compliance and Administration
17Fund. Beginning on the first day of the first calendar month to
18occur on or after August 26, 2014 (the effective date of Public
19Act 98-1098), each month the Department shall pay into the Tax
20Compliance and Administration Fund, to be used, subject to
21appropriation, to fund additional auditors and compliance
22personnel at the Department, an amount equal to 1/12 of 5% of
23the cash receipts collected during the preceding fiscal year by
24the Audit Bureau of the Department from the tax imposed by
25subsections (a), (b), (c), and (d) of Section 201 of this Act,
26net of deposits into the Income Tax Refund Fund made from those

 

 

10000SB2672sam001- 50 -LRB100 17696 HLH 38557 a

1cash receipts.
2(Source: P.A. 99-78, eff. 7-20-15; 100-22, eff. 7-6-17; 100-23,
3eff. 7-6-17; revised 8-3-17.)
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.".