101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3897

 

Introduced 2/18/2020, by Sen. Cristina Castro

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/224
35 ILCS 40/40
35 ILCS 40/65
105 ILCS 5/18-1  from Ch. 122, par. 18-1

    Amends the Invest in Kids Act and the Illinois Income Tax Act. Provides that a taxpayer may not take a credit pursuant to the Invest in Kids Act for tax years beginning on or after January 1, 2021 (currently January 1, 2023). Provides that the Invest in Kids Act is repealed on January 1, 2022. Amends the School Code. Provides that, for State fiscal years 2022 through 2025, an amount shall be transferred from the General Revenue Fund to the Common School Fund equal to the amount of credits granted under the Invest in Kids Act in State fiscal year 2019.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB3897LRB101 18372 HLH 67819 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5changing Section 224 as follows:
 
6    (35 ILCS 5/224)
7    Sec. 224. Invest in Kids credit.
8    (a) For taxable years beginning on or after January 1, 2018
9and ending before January 1, 2021 January 1, 2023, each
10taxpayer for whom a tax credit has been awarded by the
11Department under the Invest in Kids Act is entitled to a credit
12against the tax imposed under subsections (a) and (b) of
13Section 201 of this Act in an amount equal to the amount
14awarded under the Invest in Kids Act.
15    (b) For partners, shareholders of subchapter S
16corporations, and owners of limited liability companies, if the
17liability company is treated as a partnership for purposes of
18federal and State income taxation, the credit under this
19Section shall be determined in accordance with the
20determination of income and distributive share of income under
21Sections 702 and 704 and subchapter S of the Internal Revenue
22Code.
23    (c) The credit may not be carried back and may not reduce

 

 

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1the taxpayer's liability to less than zero. If the amount of
2the credit exceeds the tax liability for the year, the excess
3may be carried forward and applied to the tax liability of the
45 taxable years following the excess credit year. The tax
5credit shall be applied to the earliest year for which there is
6a tax liability. If there are credits for more than one year
7that are available to offset the liability, the earlier credit
8shall be applied first.
9    (d) A tax credit awarded by the Department under the Invest
10in Kids Act may not be claimed for any qualified contribution
11for which the taxpayer claims a federal income tax deduction.
12(Source: P.A. 100-465, eff. 8-31-17.)
 
13    Section 10. The Invest in Kids Act is amended by changing
14Sections 40 and 65 as follows:
 
15    (35 ILCS 40/40)
16    (Section scheduled to be repealed on January 1, 2024)
17    Sec. 40. Scholarship granting organization
18responsibilities.
19    (a) Before granting a scholarship for an academic year, all
20scholarship granting organizations shall assess and document
21each student's eligibility for the academic year.
22    (b) A scholarship granting organization shall grant
23scholarships only to eligible students.
24    (c) A scholarship granting organization shall allow an

 

 

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1eligible student to attend any qualified school of the
2student's choosing, subject to the availability of funds.
3    (d) In granting scholarships, a scholarship granting
4organization shall give priority to the following priority
5groups:
6        (1) eligible students who received a scholarship from a
7    scholarship granting organization during the previous
8    school year;
9        (2) eligible students who are members of a household
10    whose previous year's total annual income does not exceed
11    185% of the federal poverty level;
12        (3) eligible students who reside within a focus
13    district; and
14        (4) eligible students who are siblings of students
15    currently receiving a scholarship.
16    (d-5) A scholarship granting organization shall begin
17granting scholarships no later than February 1 preceding the
18school year for which the scholarship is sought. The priority
19groups identified in subsection (d) of this Section shall be
20eligible to receive scholarships on a first-come, first-served
21basis until the April 1 immediately preceding the school year
22for which the scholarship is sought. Applications for
23scholarships for eligible students meeting the qualifications
24of one or more priority groups that are received before April 1
25must be either approved or denied within 10 business days after
26receipt. Beginning April 1, all eligible students shall be

 

 

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1eligible to receive scholarships without regard to the priority
2groups identified in subsection (d) of this Section.
3    (e) Except as provided in subsection (e-5) of this Section,
4scholarships shall not exceed the lesser of (i) the statewide
5average operational expense per student among public schools or
6(ii) the necessary costs and fees for attendance at the
7qualified school. Scholarships shall be prorated as follows:
8        (1) for eligible students whose household income is
9    less than 185% of the federal poverty level, the
10    scholarship shall be 100% of the amount determined pursuant
11    to this subsection (e) and subsection (e-5) of this
12    Section;
13        (2) for eligible students whose household income is
14    185% or more of the federal poverty level but less than
15    250% of the federal poverty level, the average of
16    scholarships shall be 75% of the amount determined pursuant
17    to this subsection (e) and subsection (e-5) of this
18    Section; and
19        (3) for eligible students whose household income is
20    250% or more of the federal poverty level, the average of
21    scholarships shall be 50% of the amount determined pursuant
22    to this subsection (e) and subsection (e-5) of this
23    Section.
24    (e-5) The statewide average operational expense per
25student among public schools shall be multiplied by the
26following factors:

 

 

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1        (1) for students determined eligible to receive
2    services under the federal Individuals with Disabilities
3    Education Act, 2;
4        (2) for students who are English learners, as defined
5    in subsection (d) of Section 14C-2 of the School Code, 1.2;
6    and
7        (3) for students who are gifted and talented children,
8    as defined in Section 14A-20 of the School Code, 1.1.
9    (f) A scholarship granting organization shall distribute
10scholarship payments to the participating school where the
11student is enrolled.
12    (g) For the 2018-2019 school year through the 2020-2021
132021-2022 school year, each scholarship granting organization
14shall expend no less than 75% of the qualified contributions
15received during the calendar year in which the qualified
16contributions were received. No more than 25% of the qualified
17contributions may be carried forward to the following calendar
18year.
19    (h) (Blank). For the 2022-2023 school year, each
20scholarship granting organization shall expend all qualified
21contributions received during the calendar year in which the
22qualified contributions were received. No qualified
23contributions may be carried forward to the following calendar
24year.
25    (i) A scholarship granting organization shall allow an
26eligible student to transfer a scholarship during a school year

 

 

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1to any other participating school of the custodian's choice.
2Such scholarships shall be prorated.
3    (j) With the prior approval of the Department, a
4scholarship granting organization may transfer funds to
5another scholarship granting organization if additional funds
6are required to meet scholarship demands at the receiving
7scholarship granting organization. All transferred funds must
8be deposited by the receiving scholarship granting
9organization into its scholarship accounts. All transferred
10amounts received by any scholarship granting organization must
11be separately disclosed to the Department.
12    (k) If the approval of a scholarship granting organization
13is revoked as provided in Section 20 of this Act or the
14scholarship granting organization is dissolved, all remaining
15qualified contributions of the scholarship granting
16organization shall be transferred to another scholarship
17granting organization. All transferred funds must be deposited
18by the receiving scholarship granting organization into its
19scholarship accounts.
20    (l) Scholarship granting organizations shall make
21reasonable efforts to advertise the availability of
22scholarships to eligible students.
23(Source: P.A. 100-465, eff. 8-31-17.)
 
24    (35 ILCS 40/65)
25    (Section scheduled to be repealed on January 1, 2024)

 

 

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1    Sec. 65. Credit period; repeal.
2    (a) A taxpayer may take a credit under this Act for tax
3years beginning on or after January 1, 2018 and ending before
4January 1, 2021 January 1, 2023. A taxpayer may not take a
5credit pursuant to this Act for tax years beginning on or after
6January 1, 2021 January 1, 2023.
7    (b) This Act is repealed on January 1, 2022 January 1,
82024.
9(Source: P.A. 100-465, eff. 8-31-17.)
 
10    Section 15. The School Code is amended by changing Section
1118-1 as follows:
 
12    (105 ILCS 5/18-1)  (from Ch. 122, par. 18-1)
13    Sec. 18-1. Moneys constituting fund. The common school fund
14of the state shall consist of any sums accredited thereto in
15pursuance of law, of the interest on the school fund proper,
16which fund is 3% upon the proceeds of the sales of public lands
17in the State, 1/6 part excepted; and the interest on the
18surplus revenue distributed by Act of Congress and made part of
19the common school fund by Act of the legislature, March 4,
201837. The interest on the school fund proper and the surplus
21revenue shall be paid by the State annually at the rate of 6%,
22and shall be distributed as provided by law. Notwithstanding
23any other provision of law, for State fiscal years 2022 through
242025, the State Comptroller shall order transferred and the

 

 

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1State Treasurer shall transfer from the General Revenue Fund to
2the Common School Fund an amount equal to the amount of credits
3granted under the Invest in Kids Act in State fiscal year 2019.
4(Source: Laws 1961, p. 31.)