97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5082

 

Introduced 2/7/2012, by Rep. Sidney H. Mathias

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 405/2  from Ch. 120, par. 405A-2

    Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Provides that the estate tax shall not be imposed for persons dying after December 31, 2010. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5082LRB097 18478 HLH 63709 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 Estate and Generation-Skipping
5Transfer Tax Act is amended by changing Section 2 as follows:
 
6    (35 ILCS 405/2)  (from Ch. 120, par. 405A-2)
7    (Text of Section before amendment by P.A. 97-636)
8    Sec. 2. Definitions.
9    "Federal estate tax" means the tax due to the United States
10with respect to a taxable transfer under Chapter 11 of the
11Internal Revenue Code.
12    "Federal generation-skipping transfer tax" means the tax
13due to the United States with respect to a taxable transfer
14under Chapter 13 of the Internal Revenue Code.
15    "Federal return" means the federal estate tax return with
16respect to the federal estate tax and means the federal
17generation-skipping transfer tax return with respect to the
18federal generation-skipping transfer tax.
19    "Federal transfer tax" means the federal estate tax or the
20federal generation-skipping transfer tax.
21    "Illinois estate tax" means the tax due to this State with
22respect to a taxable transfer.
23    "Illinois generation-skipping transfer tax" means the tax

 

 

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1due to this State with respect to a taxable transfer that gives
2rise to a federal generation-skipping transfer tax.
3    "Illinois transfer tax" means the Illinois estate tax or
4the Illinois generation-skipping transfer tax.
5    "Internal Revenue Code" means, unless otherwise provided,
6the Internal Revenue Code of 1986, as amended from time to
7time.
8    "Non-resident trust" means a trust that is not a resident
9of this State for purposes of the Illinois Income Tax Act, as
10amended from time to time.
11    "Person" means and includes any individual, trust, estate,
12partnership, association, company or corporation.
13    "Qualified heir" means a qualified heir as defined in
14Section 2032A(e)(1) of the Internal Revenue Code.
15    "Resident trust" means a trust that is a resident of this
16State for purposes of the Illinois Income Tax Act, as amended
17from time to time.
18    "State" means any state, territory or possession of the
19United States and the District of Columbia.
20    "State tax credit" means:
21    (a) For persons dying on or after January 1, 2003 and
22through December 31, 2005, an amount equal to the full credit
23calculable under Section 2011 or Section 2604 of the Internal
24Revenue Code as the credit would have been computed and allowed
25under the Internal Revenue Code as in effect on December 31,
262001, without the reduction in the State Death Tax Credit as

 

 

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1provided in Section 2011(b)(2) or the termination of the State
2Death Tax Credit as provided in Section 2011(f) as enacted by
3the Economic Growth and Tax Relief Reconciliation Act of 2001,
4but recognizing the increased applicable exclusion amount
5through December 31, 2005.
6    (b) For persons dying after December 31, 2005 and on or
7before December 31, 2009, and for persons dying after December
831, 2010, an amount equal to the full credit calculable under
9Section 2011 or 2604 of the Internal Revenue Code as the credit
10would have been computed and allowed under the Internal Revenue
11Code as in effect on December 31, 2001, without the reduction
12in the State Death Tax Credit as provided in Section 2011(b)(2)
13or the termination of the State Death Tax Credit as provided in
14Section 2011(f) as enacted by the Economic Growth and Tax
15Relief Reconciliation Act of 2001, but recognizing the
16exclusion amount of only $2,000,000, and with reduction to the
17adjusted taxable estate for any qualified terminable interest
18property election as defined in subsection (b-1) of this
19Section. Notwithstanding any other provision of law, no tax
20shall be imposed under this Act for persons dying after
21December 31, 2010.
22    (b-1) The person required to file the Illinois return may
23elect on a timely filed Illinois return a marital deduction for
24qualified terminable interest property under Section
252056(b)(7) of the Internal Revenue Code for purposes of the
26Illinois estate tax that is separate and independent of any

 

 

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1qualified terminable interest property election for federal
2estate tax purposes. For purposes of the Illinois estate tax,
3the inclusion of property in the gross estate of a surviving
4spouse is the same as under Section 2044 of the Internal
5Revenue Code.
6    In the case of any trust for which a State or federal
7qualified terminable interest property election is made, the
8trustee may not retain non-income producing assets for more
9than a reasonable amount of time without the consent of the
10surviving spouse.
11    "Taxable transfer" means an event that gives rise to a
12state tax credit, including any credit as a result of the
13imposition of an additional tax under Section 2032A(c) of the
14Internal Revenue Code.
15    "Transferee" means a transferee within the meaning of
16Section 2603(a)(1) and Section 6901(h) of the Internal Revenue
17Code.
18    "Transferred property" means:
19        (1) With respect to a taxable transfer occurring at the
20    death of an individual, the deceased individual's gross
21    estate as defined in Section 2031 of the Internal Revenue
22    Code.
23        (2) With respect to a taxable transfer occurring as a
24    result of a taxable termination as defined in Section
25    2612(a) of the Internal Revenue Code, the taxable amount
26    determined under Section 2622(a) of the Internal Revenue

 

 

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1    Code.
2        (3) With respect to a taxable transfer occurring as a
3    result of a taxable distribution as defined in Section
4    2612(b) of the Internal Revenue Code, the taxable amount
5    determined under Section 2621(a) of the Internal Revenue
6    Code.
7        (4) With respect to an event which causes the
8    imposition of an additional estate tax under Section
9    2032A(c) of the Internal Revenue Code, the qualified real
10    property that was disposed of or which ceased to be used
11    for the qualified use, within the meaning of Section
12    2032A(c)(1) of the Internal Revenue Code.
13    "Trust" includes a trust as defined in Section 2652(b)(1)
14of the Internal Revenue Code.
15(Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11.)
 
16    (Text of Section after amendment by P.A. 97-636)
17    Sec. 2. Definitions.
18    "Federal estate tax" means the tax due to the United States
19with respect to a taxable transfer under Chapter 11 of the
20Internal Revenue Code.
21    "Federal generation-skipping transfer tax" means the tax
22due to the United States with respect to a taxable transfer
23under Chapter 13 of the Internal Revenue Code.
24    "Federal return" means the federal estate tax return with
25respect to the federal estate tax and means the federal

 

 

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1generation-skipping transfer tax return with respect to the
2federal generation-skipping transfer tax.
3    "Federal transfer tax" means the federal estate tax or the
4federal generation-skipping transfer tax.
5    "Illinois estate tax" means the tax due to this State with
6respect to a taxable transfer.
7    "Illinois generation-skipping transfer tax" means the tax
8due to this State with respect to a taxable transfer that gives
9rise to a federal generation-skipping transfer tax.
10    "Illinois transfer tax" means the Illinois estate tax or
11the Illinois generation-skipping transfer tax.
12    "Internal Revenue Code" means, unless otherwise provided,
13the Internal Revenue Code of 1986, as amended from time to
14time.
15    "Non-resident trust" means a trust that is not a resident
16of this State for purposes of the Illinois Income Tax Act, as
17amended from time to time.
18    "Person" means and includes any individual, trust, estate,
19partnership, association, company or corporation.
20    "Qualified heir" means a qualified heir as defined in
21Section 2032A(e)(1) of the Internal Revenue Code.
22    "Resident trust" means a trust that is a resident of this
23State for purposes of the Illinois Income Tax Act, as amended
24from time to time.
25    "State" means any state, territory or possession of the
26United States and the District of Columbia.

 

 

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1    "State tax credit" means:
2    (a) For persons dying on or after January 1, 2003 and
3through December 31, 2005, an amount equal to the full credit
4calculable under Section 2011 or Section 2604 of the Internal
5Revenue Code as the credit would have been computed and allowed
6under the Internal Revenue Code as in effect on December 31,
72001, without the reduction in the State Death Tax Credit as
8provided in Section 2011(b)(2) or the termination of the State
9Death Tax Credit as provided in Section 2011(f) as enacted by
10the Economic Growth and Tax Relief Reconciliation Act of 2001,
11but recognizing the increased applicable exclusion amount
12through December 31, 2005.
13    (b) For persons dying after December 31, 2005 and on or
14before December 31, 2009, and for persons dying after December
1531, 2010, an amount equal to the full credit calculable under
16Section 2011 or 2604 of the Internal Revenue Code as the credit
17would have been computed and allowed under the Internal Revenue
18Code as in effect on December 31, 2001, without the reduction
19in the State Death Tax Credit as provided in Section 2011(b)(2)
20or the termination of the State Death Tax Credit as provided in
21Section 2011(f) as enacted by the Economic Growth and Tax
22Relief Reconciliation Act of 2001, but recognizing the
23exclusion amount of only (i) $2,000,000 for persons dying prior
24to January 1, 2012, (ii) $3,500,000 for persons dying on or
25after January 1, 2012 and prior to January 1, 2013, and (iii)
26$4,000,000 for persons dying on or after January 1, 2013, and

 

 

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1with reduction to the adjusted taxable estate for any qualified
2terminable interest property election as defined in subsection
3(b-1) of this Section. Notwithstanding any other provision of
4law, no tax shall be imposed under this Act for persons dying
5after December 31, 2010.
6    (b-1) The person required to file the Illinois return may
7elect on a timely filed Illinois return a marital deduction for
8qualified terminable interest property under Section
92056(b)(7) of the Internal Revenue Code for purposes of the
10Illinois estate tax that is separate and independent of any
11qualified terminable interest property election for federal
12estate tax purposes. For purposes of the Illinois estate tax,
13the inclusion of property in the gross estate of a surviving
14spouse is the same as under Section 2044 of the Internal
15Revenue Code.
16    In the case of any trust for which a State or federal
17qualified terminable interest property election is made, the
18trustee may not retain non-income producing assets for more
19than a reasonable amount of time without the consent of the
20surviving spouse.
21    "Taxable transfer" means an event that gives rise to a
22state tax credit, including any credit as a result of the
23imposition of an additional tax under Section 2032A(c) of the
24Internal Revenue Code.
25    "Transferee" means a transferee within the meaning of
26Section 2603(a)(1) and Section 6901(h) of the Internal Revenue

 

 

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1Code.
2    "Transferred property" means:
3        (1) With respect to a taxable transfer occurring at the
4    death of an individual, the deceased individual's gross
5    estate as defined in Section 2031 of the Internal Revenue
6    Code.
7        (2) With respect to a taxable transfer occurring as a
8    result of a taxable termination as defined in Section
9    2612(a) of the Internal Revenue Code, the taxable amount
10    determined under Section 2622(a) of the Internal Revenue
11    Code.
12        (3) With respect to a taxable transfer occurring as a
13    result of a taxable distribution as defined in Section
14    2612(b) of the Internal Revenue Code, the taxable amount
15    determined under Section 2621(a) of the Internal Revenue
16    Code.
17        (4) With respect to an event which causes the
18    imposition of an additional estate tax under Section
19    2032A(c) of the Internal Revenue Code, the qualified real
20    property that was disposed of or which ceased to be used
21    for the qualified use, within the meaning of Section
22    2032A(c)(1) of the Internal Revenue Code.
23    "Trust" includes a trust as defined in Section 2652(b)(1)
24of the Internal Revenue Code.
25(Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11;
2697-636, eff. 6-1-12.)
 

 

 

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1    Section 95. No acceleration or delay. Where this Act makes
2changes in a statute that is represented in this Act by text
3that is not yet or no longer in effect (for example, a Section
4represented by multiple versions), the use of that text does
5not accelerate or delay the taking effect of (i) the changes
6made by this Act or (ii) provisions derived from any other
7Public Act.
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.