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Full Text of SB0078  97th General Assembly

SB0078 97TH GENERAL ASSEMBLY

  
  

 


 
97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB0078

 

Introduced 1/27/2011, by Sen. Matt Murphy - Christine Radogno - Chris Lauzen - Ronald Sandack - Dan Duffy, et al.

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Illinois Income Tax Act if and only if Senate Bill 2505 of the 96th General Assembly becomes law. Reduces the rate of tax imposed by Senate Bill 2505 of the 96th General Assembly to 3% for individuals, trusts, and estates and 4.8% for corporations (the rates in effect immediately prior to the passage of Senate Bill 2505). Provides that the amendatory Act supersedes Senate Bill 2505 of the 96th General Assembly and that the rates shall be deemed to be 3% for individuals, trusts, and estates and 4.8% for corporations for the entire period beginning on the effective date of Senate Bill 2505 of the 96th General Assembly through the effective date of the amendatory Act and thereafter. Makes corresponding changes concerning the distribution of tax proceeds. Amends the Illinois Estate and Generation-Skipping Transfer Tax Act to reverse certain changes made by Senate Bill 2505 of the 96th General Assembly. Effective immediately.


LRB097 05759 HLH 45823 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB0078LRB097 05759 HLH 45823 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. If and only if Senate Bill 2505 of the 96th
5General Assembly becomes law, then the Secretary of State Act
6is amended by changing Section 5 as follows:
 
7    (15 ILCS 305/5)  (from Ch. 124, par. 5)
8    Sec. 5. It shall be the duty of the Secretary of State:
9    1. To countersign and affix the seal of state to all
10commissions required by law to be issued by the Governor.
11    2. To make a register of all appointments by the Governor,
12specifying the person appointed, the office conferred, the date
13of the appointment, the date when bond or oath is taken and the
14date filed. If Senate confirmation is required, the date of the
15confirmation shall be included in the register.
16    3. To make proper indexes to public acts, resolutions,
17papers and documents in his office.
18    3-a. To review all rules of all State agencies adopted in
19compliance with the codification system prescribed by the
20Secretary. The review shall be for the purposes and include all
21the powers and duties provided in the Illinois Administrative
22Procedure Act. The Secretary of State shall cooperate with the
23Legislative Information System to insure the accuracy of the

 

 

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1text of the rules maintained under the Legislative Information
2System Act.
3    4. To give any person requiring the same paying the lawful
4fees therefor, a copy of any law, act, resolution, record or
5paper in his office, and attach thereto his certificate, under
6the seal of the state.
7    5. To take charge of and preserve from waste, and keep in
8repair, the houses, lots, grounds and appurtenances, situated
9in the City of Springfield, and belonging to or occupied by the
10State, the care of which is not otherwise provided for by law,
11and to take charge of and preserve from waste, and keep in
12repair, the houses, lots, grounds and appurtenances, situated
13in the State outside the City of Springfield where such houses,
14lots, grounds and appurtenances are occupied by the Secretary
15of State and no other State officer or agency.
16    6. To supervise the distribution of the laws.
17    7. To perform such other duties as may be required by law.
18The Secretary of State may, within appropriations authorized by
19the General Assembly, maintain offices in the State Capital and
20in such other places in the State as he may deem necessary to
21properly carry out the powers and duties vested in him by law.
22    8. In addition to all other authority granted to the
23Secretary by law, subject to appropriation, to make grants or
24otherwise provide assistance to, among others without
25limitation, units of local government, school districts,
26educational institutions, private agencies, not-for-profit

 

 

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1organizations, and for-profit entities for the health, safety,
2and welfare of Illinois residents for purposes related to
3education, transportation, construction, capital improvements,
4social services, and any other lawful public purpose. Upon
5request of the Secretary, all State agencies are mandated to
6provide the Secretary with assistance in administering the
7grants.
8    9. To notify the Auditor General of any Public Act filed
9with the Office of the Secretary of State making an
10appropriation or transfer of funds from the State treasury.
11This paragraph (9) applies only through June 30, 2015.
12(Source: P.A. 96-37, eff. 7-13-09; 09600SB2505enr.)
 
13    Section 10. If and only if Senate Bill 2505 of the 96th
14General Assembly becomes law, then the Illinois Income Tax Act
15is amended by changing Sections 201, 207, 804, and 901 as
16follows:
 
17    (35 ILCS 5/201)  (from Ch. 120, par. 2-201)
18    Sec. 201. Tax Imposed.
19    (a) In general. A tax measured by net income is hereby
20imposed on every individual, corporation, trust and estate for
21each taxable year ending after July 31, 1969 on the privilege
22of earning or receiving income in or as a resident of this
23State. Such tax shall be in addition to all other occupation or
24privilege taxes imposed by this State or by any municipal

 

 

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1corporation or political subdivision thereof.
2    (b) Rates. The tax imposed by subsection (a) of this
3Section shall be determined as follows, except as adjusted by
4subsection (d-1):
5        (1) In the case of an individual, trust or estate, for
6    taxable years ending prior to July 1, 1989, an amount equal
7    to 2 1/2% of the taxpayer's net income for the taxable
8    year.
9        (2) In the case of an individual, trust or estate, for
10    taxable years beginning prior to July 1, 1989 and ending
11    after June 30, 1989, an amount equal to the sum of (i) 2
12    1/2% of the taxpayer's net income for the period prior to
13    July 1, 1989, as calculated under Section 202.3, and (ii)
14    3% of the taxpayer's net income for the period after June
15    30, 1989, as calculated under Section 202.3.
16        (3) In the case of an individual, trust or estate, for
17    taxable years beginning after June 30, 1989, and ending
18    prior to January 1, 2011, an amount equal to 3% of the
19    taxpayer's net income for the taxable year.
20        (4) (Blank). In the case of an individual, trust, or
21    estate, for taxable years beginning prior to January 1,
22    2011, and ending after December 31, 2010, an amount equal
23    to the sum of (i) 3% of the taxpayer's net income for the
24    period prior to January 1, 2011, as calculated under
25    Section 202.5, and (ii) 5% of the taxpayer's net income for
26    the period after December 31, 2010, as calculated under

 

 

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1    Section 202.5.
2        (5) (Blank). In the case of an individual, trust, or
3    estate, for taxable years beginning on or after January 1,
4    2011, and ending prior to January 1, 2015, an amount equal
5    to 5% of the taxpayer's net income for the taxable year.
6        (5.1) (Blank). In the case of an individual, trust, or
7    estate, for taxable years beginning prior to January 1,
8    2015, and ending after December 31, 2014, an amount equal
9    to the sum of (i) 5% of the taxpayer's net income for the
10    period prior to January 1, 2015, as calculated under
11    Section 202.5, and (ii) 3.75% of the taxpayer's net income
12    for the period after December 31, 2014, as calculated under
13    Section 202.5.
14        (5.2) (Blank). In the case of an individual, trust, or
15    estate, for taxable years beginning on or after January 1,
16    2015, and ending prior to January 1, 2025, an amount equal
17    to 3.75% of the taxpayer's net income for the taxable year.
18        (5.3) (Blank). In the case of an individual, trust, or
19    estate, for taxable years beginning prior to January 1,
20    2025, and ending after December 31, 2024, an amount equal
21    to the sum of (i) 3.75% of the taxpayer's net income for
22    the period prior to January 1, 2025, as calculated under
23    Section 202.5, and (ii) 3.25% of the taxpayer's net income
24    for the period after December 31, 2024, as calculated under
25    Section 202.5.
26        (5.4) (Blank). In the case of an individual, trust, or

 

 

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1    estate, for taxable years beginning on or after January 1,
2    2025, an amount equal to 3.25% of the taxpayer's net income
3    for the taxable year.
4        (6) In the case of a corporation, for taxable years
5    ending prior to July 1, 1989, an amount equal to 4% of the
6    taxpayer's net income for the taxable year.
7        (7) In the case of a corporation, for taxable years
8    beginning prior to July 1, 1989 and ending after June 30,
9    1989, an amount equal to the sum of (i) 4% of the
10    taxpayer's net income for the period prior to July 1, 1989,
11    as calculated under Section 202.3, and (ii) 4.8% of the
12    taxpayer's net income for the period after June 30, 1989,
13    as calculated under Section 202.3.
14        (8) In the case of a corporation, for taxable years
15    beginning after June 30, 1989, and ending prior to January
16    1, 2011, an amount equal to 4.8% of the taxpayer's net
17    income for the taxable year.
18        (9) (Blank). In the case of a corporation, for taxable
19    years beginning prior to January 1, 2011, and ending after
20    December 31, 2010, an amount equal to the sum of (i) 4.8%
21    of the taxpayer's net income for the period prior to
22    January 1, 2011, as calculated under Section 202.5, and
23    (ii) 7% of the taxpayer's net income for the period after
24    December 31, 2010, as calculated under Section 202.5.
25        (10) (Blank). In the case of a corporation, for taxable
26    years beginning on or after January 1, 2011, and ending

 

 

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1    prior to January 1, 2015, an amount equal to 7% of the
2    taxpayer's net income for the taxable year.
3        (11) (Blank). In the case of a corporation, for taxable
4    years beginning prior to January 1, 2015, and ending after
5    December 31, 2014, an amount equal to the sum of (i) 7% of
6    the taxpayer's net income for the period prior to January
7    1, 2015, as calculated under Section 202.5, and (ii) 5.25%
8    of the taxpayer's net income for the period after December
9    31, 2014, as calculated under Section 202.5.
10        (12) (Blank). In the case of a corporation, for taxable
11    years beginning on or after January 1, 2015, and ending
12    prior to January 1, 2025, an amount equal to 5.25% of the
13    taxpayer's net income for the taxable year.
14        (13) (Blank). In the case of a corporation, for taxable
15    years beginning prior to January 1, 2025, and ending after
16    December 31, 2024, an amount equal to the sum of (i) 5.25%
17    of the taxpayer's net income for the period prior to
18    January 1, 2025, as calculated under Section 202.5, and
19    (ii) 4.8% of the taxpayer's net income for the period after
20    December 31, 2024, as calculated under Section 202.5.
21        (14) (Blank). In the case of a corporation, for taxable
22    years beginning on or after January 1, 2025, an amount
23    equal to 4.8% of the taxpayer's net income for the taxable
24    year.
25    The rates under this subsection (b) are subject to the
26provisions of Section 201.5.

 

 

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1    (b-5) It is the intention of the General Assembly that this
2amendatory Act of the 97th General Assembly supersedes Senate
3Bill 2505 of the 96th General Assembly. If Senate Bill 2505 of
4the 96th General Assembly becomes law prior to the effective
5date of this amendatory Act of the 96th General Assembly, then
6the rates under subsection (b) shall be deemed to be 3% for
7individuals, trusts, and estates and 4.8% for corporations for
8the entire period beginning on the effective date of Senate
9Bill 2505 of the 96th General Assembly through the effective
10date of this amendatory Act of the 97th General Assembly and
11thereafter.
12    (c) Personal Property Tax Replacement Income Tax.
13Beginning on July 1, 1979 and thereafter, in addition to such
14income tax, there is also hereby imposed the Personal Property
15Tax Replacement Income Tax measured by net income on every
16corporation (including Subchapter S corporations), partnership
17and trust, for each taxable year ending after June 30, 1979.
18Such taxes are imposed on the privilege of earning or receiving
19income in or as a resident of this State. The Personal Property
20Tax Replacement Income Tax shall be in addition to the income
21tax imposed by subsections (a) and (b) of this Section and in
22addition to all other occupation or privilege taxes imposed by
23this State or by any municipal corporation or political
24subdivision thereof.
25    (d) Additional Personal Property Tax Replacement Income
26Tax Rates. The personal property tax replacement income tax

 

 

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1imposed by this subsection and subsection (c) of this Section
2in the case of a corporation, other than a Subchapter S
3corporation and except as adjusted by subsection (d-1), shall
4be an additional amount equal to 2.85% of such taxpayer's net
5income for the taxable year, except that beginning on January
61, 1981, and thereafter, the rate of 2.85% specified in this
7subsection shall be reduced to 2.5%, and in the case of a
8partnership, trust or a Subchapter S corporation shall be an
9additional amount equal to 1.5% of such taxpayer's net income
10for the taxable year.
11    (d-1) Rate reduction for certain foreign insurers. In the
12case of a foreign insurer, as defined by Section 35A-5 of the
13Illinois Insurance Code, whose state or country of domicile
14imposes on insurers domiciled in Illinois a retaliatory tax
15(excluding any insurer whose premiums from reinsurance assumed
16are 50% or more of its total insurance premiums as determined
17under paragraph (2) of subsection (b) of Section 304, except
18that for purposes of this determination premiums from
19reinsurance do not include premiums from inter-affiliate
20reinsurance arrangements), beginning with taxable years ending
21on or after December 31, 1999, the sum of the rates of tax
22imposed by subsections (b) and (d) shall be reduced (but not
23increased) to the rate at which the total amount of tax imposed
24under this Act, net of all credits allowed under this Act,
25shall equal (i) the total amount of tax that would be imposed
26on the foreign insurer's net income allocable to Illinois for

 

 

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1the taxable year by such foreign insurer's state or country of
2domicile if that net income were subject to all income taxes
3and taxes measured by net income imposed by such foreign
4insurer's state or country of domicile, net of all credits
5allowed or (ii) a rate of zero if no such tax is imposed on such
6income by the foreign insurer's state of domicile. For the
7purposes of this subsection (d-1), an inter-affiliate includes
8a mutual insurer under common management.
9        (1) For the purposes of subsection (d-1), in no event
10    shall the sum of the rates of tax imposed by subsections
11    (b) and (d) be reduced below the rate at which the sum of:
12            (A) the total amount of tax imposed on such foreign
13        insurer under this Act for a taxable year, net of all
14        credits allowed under this Act, plus
15            (B) the privilege tax imposed by Section 409 of the
16        Illinois Insurance Code, the fire insurance company
17        tax imposed by Section 12 of the Fire Investigation
18        Act, and the fire department taxes imposed under
19        Section 11-10-1 of the Illinois Municipal Code,
20    equals 1.25% for taxable years ending prior to December 31,
21    2003, or 1.75% for taxable years ending on or after
22    December 31, 2003, of the net taxable premiums written for
23    the taxable year, as described by subsection (1) of Section
24    409 of the Illinois Insurance Code. This paragraph will in
25    no event increase the rates imposed under subsections (b)
26    and (d).

 

 

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1        (2) Any reduction in the rates of tax imposed by this
2    subsection shall be applied first against the rates imposed
3    by subsection (b) and only after the tax imposed by
4    subsection (a) net of all credits allowed under this
5    Section other than the credit allowed under subsection (i)
6    has been reduced to zero, against the rates imposed by
7    subsection (d).
8    This subsection (d-1) is exempt from the provisions of
9Section 250.
10    (e) Investment credit. A taxpayer shall be allowed a credit
11against the Personal Property Tax Replacement Income Tax for
12investment in qualified property.
13        (1) A taxpayer shall be allowed a credit equal to .5%
14    of the basis of qualified property placed in service during
15    the taxable year, provided such property is placed in
16    service on or after July 1, 1984. There shall be allowed an
17    additional credit equal to .5% of the basis of qualified
18    property placed in service during the taxable year,
19    provided such property is placed in service on or after
20    July 1, 1986, and the taxpayer's base employment within
21    Illinois has increased by 1% or more over the preceding
22    year as determined by the taxpayer's employment records
23    filed with the Illinois Department of Employment Security.
24    Taxpayers who are new to Illinois shall be deemed to have
25    met the 1% growth in base employment for the first year in
26    which they file employment records with the Illinois

 

 

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1    Department of Employment Security. The provisions added to
2    this Section by Public Act 85-1200 (and restored by Public
3    Act 87-895) shall be construed as declaratory of existing
4    law and not as a new enactment. If, in any year, the
5    increase in base employment within Illinois over the
6    preceding year is less than 1%, the additional credit shall
7    be limited to that percentage times a fraction, the
8    numerator of which is .5% and the denominator of which is
9    1%, but shall not exceed .5%. The investment credit shall
10    not be allowed to the extent that it would reduce a
11    taxpayer's liability in any tax year below zero, nor may
12    any credit for qualified property be allowed for any year
13    other than the year in which the property was placed in
14    service in Illinois. For tax years ending on or after
15    December 31, 1987, and on or before December 31, 1988, the
16    credit shall be allowed for the tax year in which the
17    property is placed in service, or, if the amount of the
18    credit exceeds the tax liability for that year, whether it
19    exceeds the original liability or the liability as later
20    amended, such excess may be carried forward and applied to
21    the tax liability of the 5 taxable years following the
22    excess credit years if the taxpayer (i) makes investments
23    which cause the creation of a minimum of 2,000 full-time
24    equivalent jobs in Illinois, (ii) is located in an
25    enterprise zone established pursuant to the Illinois
26    Enterprise Zone Act and (iii) is certified by the

 

 

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1    Department of Commerce and Community Affairs (now
2    Department of Commerce and Economic Opportunity) as
3    complying with the requirements specified in clause (i) and
4    (ii) by July 1, 1986. The Department of Commerce and
5    Community Affairs (now Department of Commerce and Economic
6    Opportunity) shall notify the Department of Revenue of all
7    such certifications immediately. For tax years ending
8    after December 31, 1988, the credit shall be allowed for
9    the tax year in which the property is placed in service,
10    or, if the amount of the credit exceeds the tax liability
11    for that year, whether it exceeds the original liability or
12    the liability as later amended, such excess may be carried
13    forward and applied to the tax liability of the 5 taxable
14    years following the excess credit years. The credit shall
15    be applied to the earliest year for which there is a
16    liability. If there is credit from more than one tax year
17    that is available to offset a liability, earlier credit
18    shall be applied first.
19        (2) The term "qualified property" means property
20    which:
21            (A) is tangible, whether new or used, including
22        buildings and structural components of buildings and
23        signs that are real property, but not including land or
24        improvements to real property that are not a structural
25        component of a building such as landscaping, sewer
26        lines, local access roads, fencing, parking lots, and

 

 

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1        other appurtenances;
2            (B) is depreciable pursuant to Section 167 of the
3        Internal Revenue Code, except that "3-year property"
4        as defined in Section 168(c)(2)(A) of that Code is not
5        eligible for the credit provided by this subsection
6        (e);
7            (C) is acquired by purchase as defined in Section
8        179(d) of the Internal Revenue Code;
9            (D) is used in Illinois by a taxpayer who is
10        primarily engaged in manufacturing, or in mining coal
11        or fluorite, or in retailing, or was placed in service
12        on or after July 1, 2006 in a River Edge Redevelopment
13        Zone established pursuant to the River Edge
14        Redevelopment Zone Act; and
15            (E) has not previously been used in Illinois in
16        such a manner and by such a person as would qualify for
17        the credit provided by this subsection (e) or
18        subsection (f).
19        (3) For purposes of this subsection (e),
20    "manufacturing" means the material staging and production
21    of tangible personal property by procedures commonly
22    regarded as manufacturing, processing, fabrication, or
23    assembling which changes some existing material into new
24    shapes, new qualities, or new combinations. For purposes of
25    this subsection (e) the term "mining" shall have the same
26    meaning as the term "mining" in Section 613(c) of the

 

 

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1    Internal Revenue Code. For purposes of this subsection (e),
2    the term "retailing" means the sale of tangible personal
3    property for use or consumption and not for resale, or
4    services rendered in conjunction with the sale of tangible
5    personal property for use or consumption and not for
6    resale. For purposes of this subsection (e), "tangible
7    personal property" has the same meaning as when that term
8    is used in the Retailers' Occupation Tax Act, and, for
9    taxable years ending after December 31, 2008, does not
10    include the generation, transmission, or distribution of
11    electricity.
12        (4) The basis of qualified property shall be the basis
13    used to compute the depreciation deduction for federal
14    income tax purposes.
15        (5) If the basis of the property for federal income tax
16    depreciation purposes is increased after it has been placed
17    in service in Illinois by the taxpayer, the amount of such
18    increase shall be deemed property placed in service on the
19    date of such increase in basis.
20        (6) The term "placed in service" shall have the same
21    meaning as under Section 46 of the Internal Revenue Code.
22        (7) If during any taxable year, any property ceases to
23    be qualified property in the hands of the taxpayer within
24    48 months after being placed in service, or the situs of
25    any qualified property is moved outside Illinois within 48
26    months after being placed in service, the Personal Property

 

 

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1    Tax Replacement Income Tax for such taxable year shall be
2    increased. Such increase shall be determined by (i)
3    recomputing the investment credit which would have been
4    allowed for the year in which credit for such property was
5    originally allowed by eliminating such property from such
6    computation and, (ii) subtracting such recomputed credit
7    from the amount of credit previously allowed. For the
8    purposes of this paragraph (7), a reduction of the basis of
9    qualified property resulting from a redetermination of the
10    purchase price shall be deemed a disposition of qualified
11    property to the extent of such reduction.
12        (8) Unless the investment credit is extended by law,
13    the basis of qualified property shall not include costs
14    incurred after December 31, 2013, except for costs incurred
15    pursuant to a binding contract entered into on or before
16    December 31, 2013.
17        (9) Each taxable year ending before December 31, 2000,
18    a partnership may elect to pass through to its partners the
19    credits to which the partnership is entitled under this
20    subsection (e) for the taxable year. A partner may use the
21    credit allocated to him or her under this paragraph only
22    against the tax imposed in subsections (c) and (d) of this
23    Section. If the partnership makes that election, those
24    credits shall be allocated among the partners in the
25    partnership in accordance with the rules set forth in
26    Section 704(b) of the Internal Revenue Code, and the rules

 

 

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1    promulgated under that Section, and the allocated amount of
2    the credits shall be allowed to the partners for that
3    taxable year. The partnership shall make this election on
4    its Personal Property Tax Replacement Income Tax return for
5    that taxable year. The election to pass through the credits
6    shall be irrevocable.
7        For taxable years ending on or after December 31, 2000,
8    a partner that qualifies its partnership for a subtraction
9    under subparagraph (I) of paragraph (2) of subsection (d)
10    of Section 203 or a shareholder that qualifies a Subchapter
11    S corporation for a subtraction under subparagraph (S) of
12    paragraph (2) of subsection (b) of Section 203 shall be
13    allowed a credit under this subsection (e) equal to its
14    share of the credit earned under this subsection (e) during
15    the taxable year by the partnership or Subchapter S
16    corporation, determined in accordance with the
17    determination of income and distributive share of income
18    under Sections 702 and 704 and Subchapter S of the Internal
19    Revenue Code. This paragraph is exempt from the provisions
20    of Section 250.
21    (f) Investment credit; Enterprise Zone; River Edge
22Redevelopment Zone.
23        (1) A taxpayer shall be allowed a credit against the
24    tax imposed by subsections (a) and (b) of this Section for
25    investment in qualified property which is placed in service
26    in an Enterprise Zone created pursuant to the Illinois

 

 

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

 

 

SB0078- 19 -LRB097 05759 HLH 45823 b

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

 

 

SB0078- 20 -LRB097 05759 HLH 45823 b

1    increase shall be deemed property placed in service on the
2    date of such increase in basis.
3        (5) The term "placed in service" shall have the same
4    meaning as under Section 46 of the Internal Revenue Code.
5        (6) If during any taxable year, any property ceases to
6    be qualified property in the hands of the taxpayer within
7    48 months after being placed in service, or the situs of
8    any qualified property is moved outside the Enterprise Zone
9    or River Edge Redevelopment Zone within 48 months after
10    being placed in service, the tax imposed under subsections
11    (a) and (b) of this Section for such taxable year shall be
12    increased. Such increase shall be determined by (i)
13    recomputing the investment credit which would have been
14    allowed for the year in which credit for such property was
15    originally allowed by eliminating such property from such
16    computation, and (ii) subtracting such recomputed credit
17    from the amount of credit previously allowed. For the
18    purposes of this paragraph (6), a reduction of the basis of
19    qualified property resulting from a redetermination of the
20    purchase price shall be deemed a disposition of qualified
21    property to the extent of such reduction.
22        (7) There shall be allowed an additional credit equal
23    to 0.5% of the basis of qualified property placed in
24    service during the taxable year in a River Edge
25    Redevelopment Zone, provided such property is placed in
26    service on or after July 1, 2006, and the taxpayer's base

 

 

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1    employment within Illinois has increased by 1% or more over
2    the preceding year as determined by the taxpayer's
3    employment records filed with the Illinois Department of
4    Employment Security. Taxpayers who are new to Illinois
5    shall be deemed to have met the 1% growth in base
6    employment for the first year in which they file employment
7    records with the Illinois Department of Employment
8    Security. If, in any year, the increase in base employment
9    within Illinois over the preceding year is less than 1%,
10    the additional credit shall be limited to that percentage
11    times a fraction, the numerator of which is 0.5% and the
12    denominator of which is 1%, but shall not exceed 0.5%.
13    (g) Jobs Tax Credit; Enterprise Zone, River Edge
14Redevelopment Zone, and Foreign Trade Zone or Sub-Zone.
15        (1) A taxpayer conducting a trade or business in an
16    enterprise zone or a High Impact Business designated by the
17    Department of Commerce and Economic Opportunity or for
18    taxable years ending on or after December 31, 2006, in a
19    River Edge Redevelopment Zone conducting a trade or
20    business in a federally designated Foreign Trade Zone or
21    Sub-Zone shall be allowed a credit against the tax imposed
22    by subsections (a) and (b) of this Section in the amount of
23    $500 per eligible employee hired to work in the zone during
24    the taxable year.
25        (2) To qualify for the credit:
26            (A) the taxpayer must hire 5 or more eligible

 

 

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1        employees to work in an enterprise zone, River Edge
2        Redevelopment Zone, or federally designated Foreign
3        Trade Zone or Sub-Zone during the taxable year;
4            (B) the taxpayer's total employment within the
5        enterprise zone, River Edge Redevelopment Zone, or
6        federally designated Foreign Trade Zone or Sub-Zone
7        must increase by 5 or more full-time employees beyond
8        the total employed in that zone at the end of the
9        previous tax year for which a jobs tax credit under
10        this Section was taken, or beyond the total employed by
11        the taxpayer as of December 31, 1985, whichever is
12        later; and
13            (C) the eligible employees must be employed 180
14        consecutive days in order to be deemed hired for
15        purposes of this subsection.
16        (3) An "eligible employee" means an employee who is:
17            (A) Certified by the Department of Commerce and
18        Economic Opportunity as "eligible for services"
19        pursuant to regulations promulgated in accordance with
20        Title II of the Job Training Partnership Act, Training
21        Services for the Disadvantaged or Title III of the Job
22        Training Partnership Act, Employment and Training
23        Assistance for Dislocated Workers Program.
24            (B) Hired after the enterprise zone, River Edge
25        Redevelopment Zone, or federally designated Foreign
26        Trade Zone or Sub-Zone was designated or the trade or

 

 

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1        business was located in that zone, whichever is later.
2            (C) Employed in the enterprise zone, River Edge
3        Redevelopment Zone, or Foreign Trade Zone or Sub-Zone.
4        An employee is employed in an enterprise zone or
5        federally designated Foreign Trade Zone or Sub-Zone if
6        his services are rendered there or it is the base of
7        operations for the services performed.
8            (D) A full-time employee working 30 or more hours
9        per week.
10        (4) For tax years ending on or after December 31, 1985
11    and prior to December 31, 1988, the credit shall be allowed
12    for the tax year in which the eligible employees are hired.
13    For tax years ending on or after December 31, 1988, the
14    credit shall be allowed for the tax year immediately
15    following the tax year in which the eligible employees are
16    hired. If the amount of the credit exceeds the tax
17    liability for that year, whether it exceeds the original
18    liability or the liability as later amended, such excess
19    may be carried forward and applied to the tax liability of
20    the 5 taxable years following the excess credit year. The
21    credit shall be applied to the earliest year for which
22    there is a liability. If there is credit from more than one
23    tax year that is available to offset a liability, earlier
24    credit shall be applied first.
25        (5) The Department of Revenue shall promulgate such
26    rules and regulations as may be deemed necessary to carry

 

 

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1    out the purposes of this subsection (g).
2        (6) The credit shall be available for eligible
3    employees hired on or after January 1, 1986.
4    (h) Investment credit; High Impact Business.
5        (1) Subject to subsections (b) and (b-5) of Section 5.5
6    of the Illinois Enterprise Zone Act, a taxpayer shall be
7    allowed a credit against the tax imposed by subsections (a)
8    and (b) of this Section for investment in qualified
9    property which is placed in service by a Department of
10    Commerce and Economic Opportunity designated High Impact
11    Business. The credit shall be .5% of the basis for such
12    property. The credit shall not be available (i) until the
13    minimum investments in qualified property set forth in
14    subdivision (a)(3)(A) of Section 5.5 of the Illinois
15    Enterprise Zone Act have been satisfied or (ii) until the
16    time authorized in subsection (b-5) of the Illinois
17    Enterprise Zone Act for entities designated as High Impact
18    Businesses under subdivisions (a)(3)(B), (a)(3)(C), and
19    (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone
20    Act, and shall not be allowed to the extent that it would
21    reduce a taxpayer's liability for the tax imposed by
22    subsections (a) and (b) of this Section to below zero. The
23    credit applicable to such investments shall be taken in the
24    taxable year in which such investments have been completed.
25    The credit for additional investments beyond the minimum
26    investment by a designated high impact business authorized

 

 

SB0078- 25 -LRB097 05759 HLH 45823 b

1    under subdivision (a)(3)(A) of Section 5.5 of the Illinois
2    Enterprise Zone Act shall be available only in the taxable
3    year in which the property is placed in service and shall
4    not be allowed to the extent that it would reduce a
5    taxpayer's liability for the tax imposed by subsections (a)
6    and (b) of this Section to below zero. For tax years ending
7    on or after December 31, 1987, the credit shall be allowed
8    for the tax year in which the property is placed in
9    service, or, if the amount of the credit exceeds the tax
10    liability for that year, whether it exceeds the original
11    liability or the liability as later amended, such excess
12    may be carried forward and applied to the tax liability of
13    the 5 taxable years following the excess credit year. The
14    credit shall be applied to the earliest year for which
15    there is a liability. If there is credit from more than one
16    tax year that is available to offset a liability, the
17    credit accruing first in time shall be applied first.
18        Changes made in this subdivision (h)(1) by Public Act
19    88-670 restore changes made by Public Act 85-1182 and
20    reflect existing law.
21        (2) The term qualified property means property which:
22            (A) is tangible, whether new or used, including
23        buildings and structural components of buildings;
24            (B) is depreciable pursuant to Section 167 of the
25        Internal Revenue Code, except that "3-year property"
26        as defined in Section 168(c)(2)(A) of that Code is not

 

 

SB0078- 26 -LRB097 05759 HLH 45823 b

1        eligible for the credit provided by this subsection
2        (h);
3            (C) is acquired by purchase as defined in Section
4        179(d) of the Internal Revenue Code; and
5            (D) is not eligible for the Enterprise Zone
6        Investment Credit provided by subsection (f) of this
7        Section.
8        (3) The basis of qualified property shall be the basis
9    used to compute the depreciation deduction for federal
10    income tax purposes.
11        (4) If the basis of the property for federal income tax
12    depreciation purposes is increased after it has been placed
13    in service in a federally designated Foreign Trade Zone or
14    Sub-Zone located in Illinois by the taxpayer, the amount of
15    such increase shall be deemed property placed in service on
16    the date of such increase in basis.
17        (5) The term "placed in service" shall have the same
18    meaning as under Section 46 of the Internal Revenue Code.
19        (6) If during any taxable year ending on or before
20    December 31, 1996, any property ceases to be qualified
21    property in the hands of the taxpayer within 48 months
22    after being placed in service, or the situs of any
23    qualified property is moved outside Illinois within 48
24    months after being placed in service, the tax imposed under
25    subsections (a) and (b) of this Section for such taxable
26    year shall be increased. Such increase shall be determined

 

 

SB0078- 27 -LRB097 05759 HLH 45823 b

1    by (i) recomputing the investment credit which would have
2    been allowed for the year in which credit for such property
3    was originally allowed by eliminating such property from
4    such computation, and (ii) subtracting such recomputed
5    credit from the amount of credit previously allowed. For
6    the purposes of this paragraph (6), a reduction of the
7    basis of qualified property resulting from a
8    redetermination of the purchase price shall be deemed a
9    disposition of qualified property to the extent of such
10    reduction.
11        (7) Beginning with tax years ending after December 31,
12    1996, if a taxpayer qualifies for the credit under this
13    subsection (h) and thereby is granted a tax abatement and
14    the taxpayer relocates its entire facility in violation of
15    the explicit terms and length of the contract under Section
16    18-183 of the Property Tax Code, the tax imposed under
17    subsections (a) and (b) of this Section shall be increased
18    for the taxable year in which the taxpayer relocated its
19    facility by an amount equal to the amount of credit
20    received by the taxpayer under this subsection (h).
21    (i) Credit for Personal Property Tax Replacement Income
22Tax. For tax years ending prior to December 31, 2003, a credit
23shall be allowed against the tax imposed by subsections (a) and
24(b) of this Section for the tax imposed by subsections (c) and
25(d) of this Section. This credit shall be computed by
26multiplying the tax imposed by subsections (c) and (d) of this

 

 

SB0078- 28 -LRB097 05759 HLH 45823 b

1Section by a fraction, the numerator of which is base income
2allocable to Illinois and the denominator of which is Illinois
3base income, and further multiplying the product by the tax
4rate imposed by subsections (a) and (b) of this Section.
5    Any credit earned on or after December 31, 1986 under this
6subsection which is unused in the year the credit is computed
7because it exceeds the tax liability imposed by subsections (a)
8and (b) for that year (whether it exceeds the original
9liability or the liability as later amended) may be carried
10forward and applied to the tax liability imposed by subsections
11(a) and (b) of the 5 taxable years following the excess credit
12year, provided that no credit may be carried forward to any
13year ending on or after December 31, 2003. This credit shall be
14applied first to the earliest year for which there is a
15liability. If there is a credit under this subsection from more
16than one tax year that is available to offset a liability the
17earliest credit arising under this subsection shall be applied
18first.
19    If, during any taxable year ending on or after December 31,
201986, the tax imposed by subsections (c) and (d) of this
21Section for which a taxpayer has claimed a credit under this
22subsection (i) is reduced, the amount of credit for such tax
23shall also be reduced. Such reduction shall be determined by
24recomputing the credit to take into account the reduced tax
25imposed by subsections (c) and (d). If any portion of the
26reduced amount of credit has been carried to a different

 

 

SB0078- 29 -LRB097 05759 HLH 45823 b

1taxable year, an amended return shall be filed for such taxable
2year to reduce the amount of credit claimed.
3    (j) Training expense credit. Beginning with tax years
4ending on or after December 31, 1986 and prior to December 31,
52003, a taxpayer shall be allowed a credit against the tax
6imposed by subsections (a) and (b) under this Section for all
7amounts paid or accrued, on behalf of all persons employed by
8the taxpayer in Illinois or Illinois residents employed outside
9of Illinois by a taxpayer, for educational or vocational
10training in semi-technical or technical fields or semi-skilled
11or skilled fields, which were deducted from gross income in the
12computation of taxable income. The credit against the tax
13imposed by subsections (a) and (b) shall be 1.6% of such
14training expenses. For partners, shareholders of subchapter S
15corporations, and owners of limited liability companies, if the
16liability company is treated as a partnership for purposes of
17federal and State income taxation, there shall be allowed a
18credit under this subsection (j) to be determined in accordance
19with the determination of income and distributive share of
20income under Sections 702 and 704 and subchapter S of the
21Internal Revenue Code.
22    Any credit allowed under this subsection which is unused in
23the year the credit is earned may be carried forward to each of
24the 5 taxable years following the year for which the credit is
25first computed until it is used. This credit shall be applied
26first to the earliest year for which there is a liability. If

 

 

SB0078- 30 -LRB097 05759 HLH 45823 b

1there is a credit under this subsection from more than one tax
2year that is available to offset a liability the earliest
3credit arising under this subsection shall be applied first. No
4carryforward credit may be claimed in any tax year ending on or
5after December 31, 2003.
6    (k) Research and development credit.
7    For tax years ending after July 1, 1990 and prior to
8December 31, 2003, and beginning again for tax years ending on
9or after December 31, 2004, and ending prior to January 1,
102011, a taxpayer shall be allowed a credit against the tax
11imposed by subsections (a) and (b) of this Section for
12increasing research activities in this State. The credit
13allowed against the tax imposed by subsections (a) and (b)
14shall be equal to 6 1/2% of the qualifying expenditures for
15increasing research activities in this State. For partners,
16shareholders of subchapter S corporations, and owners of
17limited liability companies, if the liability company is
18treated as a partnership for purposes of federal and State
19income taxation, there shall be allowed a credit under this
20subsection to be determined in accordance with the
21determination of income and distributive share of income under
22Sections 702 and 704 and subchapter S of the Internal Revenue
23Code.
24    For purposes of this subsection, "qualifying expenditures"
25means the qualifying expenditures as defined for the federal
26credit for increasing research activities which would be

 

 

SB0078- 31 -LRB097 05759 HLH 45823 b

1allowable under Section 41 of the Internal Revenue Code and
2which are conducted in this State, "qualifying expenditures for
3increasing research activities in this State" means the excess
4of qualifying expenditures for the taxable year in which
5incurred over qualifying expenditures for the base period,
6"qualifying expenditures for the base period" means the average
7of the qualifying expenditures for each year in the base
8period, and "base period" means the 3 taxable years immediately
9preceding the taxable year for which the determination is being
10made.
11    Any credit in excess of the tax liability for the taxable
12year may be carried forward. A taxpayer may elect to have the
13unused credit shown on its final completed return carried over
14as a credit against the tax liability for the following 5
15taxable years or until it has been fully used, whichever occurs
16first; provided that no credit earned in a tax year ending
17prior to December 31, 2003 may be carried forward to any year
18ending on or after December 31, 2003, and no credit may be
19carried forward to any taxable year ending on or after January
201, 2011.
21    If an unused credit is carried forward to a given year from
222 or more earlier years, that credit arising in the earliest
23year will be applied first against the tax liability for the
24given year. If a tax liability for the given year still
25remains, the credit from the next earliest year will then be
26applied, and so on, until all credits have been used or no tax

 

 

SB0078- 32 -LRB097 05759 HLH 45823 b

1liability for the given year remains. Any remaining unused
2credit or credits then will be carried forward to the next
3following year in which a tax liability is incurred, except
4that no credit can be carried forward to a year which is more
5than 5 years after the year in which the expense for which the
6credit is given was incurred.
7    No inference shall be drawn from this amendatory Act of the
891st General Assembly in construing this Section for taxable
9years beginning before January 1, 1999.
10    (l) Environmental Remediation Tax Credit.
11        (i) For tax years ending after December 31, 1997 and on
12    or before December 31, 2001, a taxpayer shall be allowed a
13    credit against the tax imposed by subsections (a) and (b)
14    of this Section for certain amounts paid for unreimbursed
15    eligible remediation costs, as specified in this
16    subsection. For purposes of this Section, "unreimbursed
17    eligible remediation costs" means costs approved by the
18    Illinois Environmental Protection Agency ("Agency") under
19    Section 58.14 of the Environmental Protection Act that were
20    paid in performing environmental remediation at a site for
21    which a No Further Remediation Letter was issued by the
22    Agency and recorded under Section 58.10 of the
23    Environmental Protection Act. The credit must be claimed
24    for the taxable year in which Agency approval of the
25    eligible remediation costs is granted. The credit is not
26    available to any taxpayer if the taxpayer or any related

 

 

SB0078- 33 -LRB097 05759 HLH 45823 b

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

 

 

SB0078- 34 -LRB097 05759 HLH 45823 b

1    shareholders of subchapter S corporations, there shall be
2    allowed a credit under this subsection to be determined in
3    accordance with the determination of income and
4    distributive share of income under Sections 702 and 704 and
5    subchapter S of the Internal Revenue Code.
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. The
10    term "unused credit" does not include any amounts of
11    unreimbursed eligible remediation costs in excess of the
12    maximum credit per site authorized under paragraph (i).
13    This credit shall be applied first to the earliest year for
14    which there is a liability. If there is a credit under this
15    subsection from more than one tax year that is available to
16    offset a liability, the earliest credit arising under this
17    subsection shall be applied first. A credit allowed under
18    this subsection may be sold to a buyer as part of a sale of
19    all or part of the remediation site for which the credit
20    was granted. The purchaser of a remediation site and the
21    tax credit shall succeed to the unused credit and remaining
22    carry-forward period of the seller. To perfect the
23    transfer, the assignor shall record the transfer in the
24    chain of title for the site and provide written notice to
25    the Director of the Illinois Department of Revenue of the
26    assignor's intent to sell the remediation site and the

 

 

SB0078- 35 -LRB097 05759 HLH 45823 b

1    amount of the tax credit to be transferred as a portion of
2    the sale. In no event may a credit be transferred to any
3    taxpayer if the taxpayer or a related party would not be
4    eligible under the provisions of subsection (i).
5        (iii) For purposes of this Section, the term "site"
6    shall have the same meaning as under Section 58.2 of the
7    Environmental Protection Act.
8    (m) Education expense credit. Beginning with tax years
9ending after December 31, 1999, a taxpayer who is the custodian
10of one or more qualifying pupils shall be allowed a credit
11against the tax imposed by subsections (a) and (b) of this
12Section for qualified education expenses incurred on behalf of
13the qualifying pupils. The credit shall be equal to 25% of
14qualified education expenses, but in no event may the total
15credit under this subsection claimed by a family that is the
16custodian of qualifying pupils exceed $500. In no event shall a
17credit under this subsection reduce the taxpayer's liability
18under this Act to less than zero. This subsection is exempt
19from the provisions of Section 250 of this Act.
20    For purposes of this subsection:
21    "Qualifying pupils" means individuals who (i) are
22residents of the State of Illinois, (ii) are under the age of
2321 at the close of the school year for which a credit is
24sought, and (iii) during the school year for which a credit is
25sought were full-time pupils enrolled in a kindergarten through
26twelfth grade education program at any school, as defined in

 

 

SB0078- 36 -LRB097 05759 HLH 45823 b

1this subsection.
2    "Qualified education expense" means the amount incurred on
3behalf of a qualifying pupil in excess of $250 for tuition,
4book fees, and lab fees at the school in which the pupil is
5enrolled during the regular school year.
6    "School" means any public or nonpublic elementary or
7secondary school in Illinois that is in compliance with Title
8VI of the Civil Rights Act of 1964 and attendance at which
9satisfies the requirements of Section 26-1 of the School Code,
10except that nothing shall be construed to require a child to
11attend any particular public or nonpublic school to qualify for
12the credit under this Section.
13    "Custodian" means, with respect to qualifying pupils, an
14Illinois resident who is a parent, the parents, a legal
15guardian, or the legal guardians of the qualifying pupils.
16    (n) River Edge Redevelopment Zone site remediation tax
17credit.
18        (i) For tax years ending on or after December 31, 2006,
19    a taxpayer shall be allowed a credit against the tax
20    imposed by subsections (a) and (b) of this Section for
21    certain amounts paid for unreimbursed eligible remediation
22    costs, as specified in this subsection. For purposes of
23    this Section, "unreimbursed eligible remediation costs"
24    means costs approved by the Illinois Environmental
25    Protection Agency ("Agency") under Section 58.14a of the
26    Environmental Protection Act that were paid in performing

 

 

SB0078- 37 -LRB097 05759 HLH 45823 b

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

 

 

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1    $100,000 per site.
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. This
6    credit shall be applied first to the earliest year for
7    which there is a liability. If there is a credit under this
8    subsection from more than one tax year that is available to
9    offset a liability, the earliest credit arising under this
10    subsection shall be applied first. A credit allowed under
11    this subsection may be sold to a buyer as part of a sale of
12    all or part of the remediation site for which the credit
13    was granted. The purchaser of a remediation site and the
14    tax credit shall succeed to the unused credit and remaining
15    carry-forward period of the seller. To perfect the
16    transfer, the assignor shall record the transfer in the
17    chain of title for the site and provide written notice to
18    the Director of the Illinois Department of Revenue of the
19    assignor's intent to sell the remediation site and the
20    amount of the tax credit to be transferred as a portion of
21    the sale. In no event may a credit be transferred to any
22    taxpayer if the taxpayer or a related party would not be
23    eligible under the provisions of subsection (i).
24        (iii) For purposes of this Section, the term "site"
25    shall have the same meaning as under Section 58.2 of the
26    Environmental Protection Act.

 

 

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1        (iv) This subsection is exempt from the provisions of
2    Section 250.
3(Source: P.A. 95-454, eff. 8-27-07; 96-115, eff. 7-31-09;
496-116, eff. 7-31-09; 96-937, eff. 6-23-10; 96-1000, eff.
57-2-10; 09600SB2505enr.)
 
6    (35 ILCS 5/207)  (from Ch. 120, par. 2-207)
7    Sec. 207. Net Losses.
8    (a) If after applying all of the (i) modifications provided
9for in paragraph (2) of Section 203(b), paragraph (2) of
10Section 203(c) and paragraph (2) of Section 203(d) and (ii) the
11allocation and apportionment provisions of Article 3 of this
12Act and subsection (c) of this Section, the taxpayer's net
13income results in a loss;
14        (1) for any taxable year ending prior to December 31,
15    1999, such loss shall be allowed as a carryover or
16    carryback deduction in the manner allowed under Section 172
17    of the Internal Revenue Code;
18        (2) for any taxable year ending on or after December
19    31, 1999 and prior to December 31, 2003, such loss shall be
20    allowed as a carryback to each of the 2 taxable years
21    preceding the taxable year of such loss and shall be a net
22    operating loss carryover to each of the 20 taxable years
23    following the taxable year of such loss; and
24        (3) for any taxable year ending on or after December
25    31, 2003, such loss shall be allowed as a net operating

 

 

SB0078- 40 -LRB097 05759 HLH 45823 b

1    loss carryover to each of the 12 taxable years following
2    the taxable year of such loss, except as provided in
3    subsection (d).
4    (a-5) Election to relinquish carryback and order of
5application of losses.
6            (A) For losses incurred in tax years ending prior
7        to December 31, 2003, the taxpayer may elect to
8        relinquish the entire carryback period with respect to
9        such loss. Such election shall be made in the form and
10        manner prescribed by the Department and shall be made
11        by the due date (including extensions of time) for
12        filing the taxpayer's return for the taxable year in
13        which such loss is incurred, and such election, once
14        made, shall be irrevocable.
15            (B) The entire amount of such loss shall be carried
16        to the earliest taxable year to which such loss may be
17        carried. The amount of such loss which shall be carried
18        to each of the other taxable years shall be the excess,
19        if any, of the amount of such loss over the sum of the
20        deductions for carryback or carryover of such loss
21        allowable for each of the prior taxable years to which
22        such loss may be carried.
23    (b) Any loss determined under subsection (a) of this
24Section must be carried back or carried forward in the same
25manner for purposes of subsections (a) and (b) of Section 201
26of this Act as for purposes of subsections (c) and (d) of

 

 

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1Section 201 of this Act.
2    (c) Notwithstanding any other provision of this Act, for
3each taxable year ending on or after December 31, 2008, for
4purposes of computing the loss for the taxable year under
5subsection (a) of this Section and the deduction taken into
6account for the taxable year for a net operating loss carryover
7under paragraphs (1), (2), and (3) of subsection (a) of this
8Section, the loss and net operating loss carryover shall be
9reduced in an amount equal to the reduction to the net
10operating loss and net operating loss carryover to the taxable
11year, respectively, required under Section 108(b)(2)(A) of the
12Internal Revenue Code, multiplied by a fraction, the numerator
13of which is the amount of discharge of indebtedness income that
14is excluded from gross income for the taxable year (but only if
15the taxable year ends on or after December 31, 2008) under
16Section 108(a) of the Internal Revenue Code and that would have
17been allocated and apportioned to this State under Article 3 of
18this Act but for that exclusion, and the denominator of which
19is the total amount of discharge of indebtedness income
20excluded from gross income under Section 108(a) of the Internal
21Revenue Code for the taxable year. The reduction required under
22this subsection (c) shall be made after the determination of
23Illinois net income for the taxable year in which the
24indebtedness is discharged.
25    (d) In the case of a corporation (other than a Subchapter S
26corporation), no carryover deduction shall be allowed under

 

 

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1this Section for any taxable year ending after December 31,
22010 and prior to December 31, 2014; provided that, for
3purposes of determining the taxable years to which a net loss
4may be carried under subsection (a) of this Section, no taxable
5year for which a deduction is disallowed under this subsection
6shall be counted.
7(Source: P.A. 95-233, eff. 8-16-07; 09600SB2505enr.)
 
8    (35 ILCS 5/804)  (from Ch. 120, par. 8-804)
9    Sec. 804. Failure to Pay Estimated Tax.
10    (a) In general. In case of any underpayment of estimated
11tax by a taxpayer, except as provided in subsection (d) or (e),
12the taxpayer shall be liable to a penalty in an amount
13determined at the rate prescribed by Section 3-3 of the Uniform
14Penalty and Interest Act upon the amount of the underpayment
15(determined under subsection (b)) for each required
16installment.
17    (b) Amount of underpayment. For purposes of subsection (a),
18the amount of the underpayment shall be the excess of:
19        (1) the amount of the installment which would be
20    required to be paid under subsection (c), over
21        (2) the amount, if any, of the installment paid on or
22    before the last date prescribed for payment.
23    (c) Amount of Required Installments.
24        (1) Amount.
25            (A) In General. Except as provided in paragraph

 

 

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1        (2), the amount of any required installment shall be
2        25% of the required annual payment.
3            (B) Required Annual Payment. For purposes of
4        subparagraph (A), the term "required annual payment"
5        means the lesser of
6                (i) 90% of the tax shown on the return for the
7            taxable year, or if no return is filed, 90% of the
8            tax for such year, or
9                (ii) for installments due prior to February 1,
10            2011, and after January 31, 2012, 100% of the tax
11            shown on the return of the taxpayer for the
12            preceding taxable year if a return showing a
13            liability for tax was filed by the taxpayer for the
14            preceding taxable year and such preceding year was
15            a taxable year of 12 months. ; or
16                (iii) for installments due after January 31,
17            2011, and prior to February 1, 2012, 150% of the
18            tax shown on the return of the taxpayer for the
19            preceding taxable year if a return showing a
20            liability for tax was filed by the taxpayer for the
21            preceding taxable year and such preceding year was
22            a taxable year of 12 months.
23        (2) Lower Required Installment where Annualized Income
24    Installment is Less Than Amount Determined Under Paragraph
25    (1).
26            (A) In General. In the case of any required

 

 

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1        installment if a taxpayer establishes that the
2        annualized income installment is less than the amount
3        determined under paragraph (1),
4                (i) the amount of such required installment
5            shall be the annualized income installment, and
6                (ii) any reduction in a required installment
7            resulting from the application of this
8            subparagraph shall be recaptured by increasing the
9            amount of the next required installment determined
10            under paragraph (1) by the amount of such
11            reduction, and by increasing subsequent required
12            installments to the extent that the reduction has
13            not previously been recaptured under this clause.
14            (B) Determination of Annualized Income
15        Installment. In the case of any required installment,
16        the annualized income installment is the excess, if
17        any, of
18                (i) an amount equal to the applicable
19            percentage of the tax for the taxable year computed
20            by placing on an annualized basis the net income
21            for months in the taxable year ending before the
22            due date for the installment, over
23                (ii) the aggregate amount of any prior
24            required installments for the taxable year.
25            (C) Applicable Percentage.
26        In the case of the followingThe applicable

 

 

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1        required installments:percentage is:
2        1st ...............................22.5%
3        2nd ...............................45%
4        3rd ...............................67.5%
5        4th ...............................90%
6            (D) Annualized Net Income; Individuals. For
7        individuals, net income shall be placed on an
8        annualized basis by:
9                (i) multiplying by 12, or in the case of a
10            taxable year of less than 12 months, by the number
11            of months in the taxable year, the net income
12            computed without regard to the standard exemption
13            for the months in the taxable year ending before
14            the month in which the installment is required to
15            be paid;
16                (ii) dividing the resulting amount by the
17            number of months in the taxable year ending before
18            the month in which such installment date falls; and
19                (iii) deducting from such amount the standard
20            exemption allowable for the taxable year, such
21            standard exemption being determined as of the last
22            date prescribed for payment of the installment.
23            (E) Annualized Net Income; Corporations. For
24        corporations, net income shall be placed on an
25        annualized basis by multiplying by 12 the taxable
26        income

 

 

SB0078- 46 -LRB097 05759 HLH 45823 b

1                (i) for the first 3 months of the taxable year,
2            in the case of the installment required to be paid
3            in the 4th month,
4                (ii) for the first 3 months or for the first 5
5            months of the taxable year, in the case of the
6            installment required to be paid in the 6th month,
7                (iii) for the first 6 months or for the first 8
8            months of the taxable year, in the case of the
9            installment required to be paid in the 9th month,
10            and
11                (iv) for the first 9 months or for the first 11
12            months of the taxable year, in the case of the
13            installment required to be paid in the 12th month
14            of the taxable year,
15        then dividing the resulting amount by the number of
16        months in the taxable year (3, 5, 6, 8, 9, or 11 as the
17        case may be).
18    (d) Exceptions. Notwithstanding the provisions of the
19preceding subsections, the penalty imposed by subsection (a)
20shall not be imposed if the taxpayer was not required to file
21an Illinois income tax return for the preceding taxable year,
22or, for individuals, if the taxpayer had no tax liability for
23the preceding taxable year and such year was a taxable year of
2412 months. The penalty imposed by subsection (a) shall also not
25be imposed on any underpayments of estimated tax due before the
26effective date of this amendatory Act of 1998 which

 

 

SB0078- 47 -LRB097 05759 HLH 45823 b

1underpayments are solely attributable to the change in
2apportionment from subsection (a) to subsection (h) of Section
3304. The provisions of this amendatory Act of 1998 apply to tax
4years ending on or after December 31, 1998.
5    (e) The penalty imposed for underpayment of estimated tax
6by subsection (a) of this Section shall not be imposed to the
7extent that the Director or his or her designate determines,
8pursuant to Section 3-8 of the Uniform Penalty and Interest Act
9that the penalty should not be imposed.
10    (f) Definition of tax. For purposes of subsections (b) and
11(c), the term "tax" means the excess of the tax imposed under
12Article 2 of this Act, over the amounts credited against such
13tax under Sections 601(b) (3) and (4).
14    (g) Application of Section in case of tax withheld under
15Article 7. For purposes of applying this Section:
16        (1) in the case of an individual, tax withheld from
17    compensation for the taxable year shall be deemed a payment
18    of estimated tax, and an equal part of such amount shall be
19    deemed paid on each installment date for such taxable year,
20    unless the taxpayer establishes the dates on which all
21    amounts were actually withheld, in which case the amounts
22    so withheld shall be deemed payments of estimated tax on
23    the dates on which such amounts were actually withheld;
24        (2) amounts timely paid by a partnership, Subchapter S
25    corporation, or trust on behalf of a partner, shareholder,
26    or beneficiary pursuant to subsection (f) of Section 502 or

 

 

SB0078- 48 -LRB097 05759 HLH 45823 b

1    Section 709.5 and claimed as a payment of estimated tax
2    shall be deemed a payment of estimated tax made on the last
3    day of the taxable year of the partnership, Subchapter S
4    corporation, or trust for which the income from the
5    withholding is made was computed; and
6        (3) all other amounts pursuant to Article 7 shall be
7    deemed a payment of estimated tax on the date the payment
8    is made to the taxpayer of the amount from which the tax is
9    withheld.
10    (g-5) Amounts withheld under the State Salary and Annuity
11Withholding Act. An individual who has amounts withheld under
12paragraph (10) of Section 4 of the State Salary and Annuity
13Withholding Act may elect to have those amounts treated as
14payments of estimated tax made on the dates on which those
15amounts are actually withheld.
16    (i) Short taxable year. The application of this Section to
17taxable years of less than 12 months shall be in accordance
18with regulations prescribed by the Department.
19    The changes in this Section made by Public Act 84-127 shall
20apply to taxable years ending on or after January 1, 1986.
21(Source: P.A. 95-233, eff. 8-16-07; 09600SB2505enr.)
 
22    (35 ILCS 5/901)  (from Ch. 120, par. 9-901)
23    Sec. 901. Collection Authority.
24    (a) In general.
25    The Department shall collect the taxes imposed by this Act.

 

 

SB0078- 49 -LRB097 05759 HLH 45823 b

1The Department shall collect certified past due child support
2amounts under Section 2505-650 of the Department of Revenue Law
3(20 ILCS 2505/2505-650). Except as provided in subsections (c)
4and , (e), (f), and (g) of this Section, money collected
5pursuant to subsections (a) and (b) of Section 201 of this Act
6shall be paid into the General Revenue Fund in the State
7treasury; money collected pursuant to subsections (c) and (d)
8of Section 201 of this Act shall be paid into the Personal
9Property Tax Replacement Fund, a special fund in the State
10Treasury; and money collected under Section 2505-650 of the
11Department of Revenue Law (20 ILCS 2505/2505-650) shall be paid
12into the Child Support Enforcement Trust Fund, a special fund
13outside the State Treasury, or to the State Disbursement Unit
14established under Section 10-26 of the Illinois Public Aid
15Code, as directed by the Department of Healthcare and Family
16Services.
17    (b) Local Government Distributive Fund.
18    Beginning August 1, 1969, and continuing through June 30,
191994, the Treasurer shall transfer each month from the General
20Revenue Fund to a special fund in the State treasury, to be
21known as the "Local Government Distributive Fund", an amount
22equal to 1/12 of the net revenue realized from the tax imposed
23by subsections (a) and (b) of Section 201 of this Act during
24the preceding month. Beginning July 1, 1994, and continuing
25through June 30, 1995, the Treasurer shall transfer each month
26from the General Revenue Fund to the Local Government

 

 

SB0078- 50 -LRB097 05759 HLH 45823 b

1Distributive Fund an amount equal to 1/11 of the net revenue
2realized from the tax imposed by subsections (a) and (b) of
3Section 201 of this Act during the preceding month. Beginning
4July 1, 1995 and continuing through January 31, 2011, the
5Treasurer shall transfer each month from the General Revenue
6Fund to the Local Government Distributive Fund an amount equal
7to the net of (i) 1/10 of the net revenue realized from the tax
8imposed by subsections (a) and (b) of Section 201 of the
9Illinois Income Tax Act during the preceding month (ii) minus,
10beginning July 1, 2003 and ending June 30, 2004, $6,666,666,
11and beginning July 1, 2004, zero. Beginning February 1, 2011,
12and continuing through January 31, 2015, the Treasurer shall
13transfer each month from the General Revenue Fund to the Local
14Government Distributive Fund an amount equal to the sum of (i)
156% (10% of the ratio of the 3% individual income tax rate prior
16to 2011 to the 5% individual income tax rate after 2010) of the
17net revenue realized from the tax imposed by subsections (a)
18and (b) of Section 201 of this Act upon individuals, trusts,
19and estates during the preceding month and (ii) 6.86% (10% of
20the ratio of the 4.8% corporate income tax rate prior to 2011
21to the 7% corporate income tax rate after 2010) of the net
22revenue realized from the tax imposed by subsections (a) and
23(b) of Section 201 of this Act upon corporations during the
24preceding month. Beginning February 1, 2015 and continuing
25through January 31, 2025, the Treasurer shall transfer each
26month from the General Revenue Fund to the Local Government

 

 

SB0078- 51 -LRB097 05759 HLH 45823 b

1Distributive Fund an amount equal to the sum of (i) 8% (10% of
2the ratio of the 3% individual income tax rate prior to 2011 to
3the 3.75% individual income tax rate after 2014) of the net
4revenue realized from the tax imposed by subsections (a) and
5(b) of Section 201 of this Act upon individuals, trusts, and
6estates during the preceding month and (ii) 9.14% (10% of the
7ratio of the 4.8% corporate income tax rate prior to 2011 to
8the 5.25% corporate income tax rate after 2014) of the net
9revenue realized from the tax imposed by subsections (a) and
10(b) of Section 201 of this Act upon corporations during the
11preceding month. Beginning February 1, 2025, the Treasurer
12shall transfer each month from the General Revenue Fund to the
13Local Government Distributive Fund an amount equal to the sum
14of (i) 9.23% (10% of the ratio of the 3% individual income tax
15rate prior to 2011 to the 3.25% individual income tax rate
16after 2024) of the net revenue realized from the tax imposed by
17subsections (a) and (b) of Section 201 of this Act upon
18individuals, trusts, and estates during the preceding month and
19(ii) 10% of the net revenue realized from the tax imposed by
20subsections (a) and (b) of Section 201 of this Act upon
21corporations during the preceding month. Net revenue realized
22for a month shall be defined as the revenue from the tax
23imposed by subsections (a) and (b) of Section 201 of this Act
24which is deposited in the General Revenue Fund, the Education
25Assistance Fund, and the Income Tax Surcharge Local Government
26Distributive Fund, the Fund for the Advancement of Education,

 

 

SB0078- 52 -LRB097 05759 HLH 45823 b

1and the Commitment to Human Services Fund during the month
2minus the amount paid out of the General Revenue Fund in State
3warrants during that same month as refunds to taxpayers for
4overpayment of liability under the tax imposed by subsections
5(a) and (b) of Section 201 of this Act.
6    (c) Deposits Into Income Tax Refund Fund.
7        (1) Beginning on January 1, 1989 and thereafter, the
8    Department shall deposit a percentage of the amounts
9    collected pursuant to subsections (a) and (b)(1), (2), and
10    (3), of Section 201 of this Act into a fund in the State
11    treasury known as the Income Tax Refund Fund. The
12    Department shall deposit 6% of such amounts during the
13    period beginning January 1, 1989 and ending on June 30,
14    1989. Beginning with State fiscal year 1990 and for each
15    fiscal year thereafter, the percentage deposited into the
16    Income Tax Refund Fund during a fiscal year shall be the
17    Annual Percentage. For fiscal years 1999 through 2001, the
18    Annual Percentage shall be 7.1%. For fiscal year 2003, the
19    Annual Percentage shall be 8%. For fiscal year 2004, the
20    Annual Percentage shall be 11.7%. Upon the effective date
21    of this amendatory Act of the 93rd General Assembly, the
22    Annual Percentage shall be 10% for fiscal year 2005. For
23    fiscal year 2006, the Annual Percentage shall be 9.75%. For
24    fiscal year 2007, the Annual Percentage shall be 9.75%. For
25    fiscal year 2008, the Annual Percentage shall be 7.75%. For
26    fiscal year 2009, the Annual Percentage shall be 9.75%. For

 

 

SB0078- 53 -LRB097 05759 HLH 45823 b

1    fiscal year 2010, the Annual Percentage shall be 9.75%. For
2    fiscal year 2011, the Annual Percentage shall be 8.75%. For
3    all other fiscal years, the Annual Percentage shall be
4    calculated as a fraction, the numerator of which shall be
5    the amount of refunds approved for payment by the
6    Department during the preceding fiscal year as a result of
7    overpayment of tax liability under subsections (a) and
8    (b)(1), (2), and (3) of Section 201 of this Act plus the
9    amount of such refunds remaining approved but unpaid at the
10    end of the preceding fiscal year, minus the amounts
11    transferred into the Income Tax Refund Fund from the
12    Tobacco Settlement Recovery Fund, and the denominator of
13    which shall be the amounts which will be collected pursuant
14    to subsections (a) and (b)(1), (2), and (3) of Section 201
15    of this Act during the preceding fiscal year; except that
16    in State fiscal year 2002, the Annual Percentage shall in
17    no event exceed 7.6%. The Director of Revenue shall certify
18    the Annual Percentage to the Comptroller on the last
19    business day of the fiscal year immediately preceding the
20    fiscal year for which it is to be effective.
21        (2) Beginning on January 1, 1989 and thereafter, the
22    Department shall deposit a percentage of the amounts
23    collected pursuant to subsections (a) and (b)(6), (7), and
24    (8), (c) and (d) of Section 201 of this Act into a fund in
25    the State treasury known as the Income Tax Refund Fund. The
26    Department shall deposit 18% of such amounts during the

 

 

SB0078- 54 -LRB097 05759 HLH 45823 b

1    period beginning January 1, 1989 and ending on June 30,
2    1989. Beginning with State fiscal year 1990 and for each
3    fiscal year thereafter, the percentage deposited into the
4    Income Tax Refund Fund during a fiscal year shall be the
5    Annual Percentage. For fiscal years 1999, 2000, and 2001,
6    the Annual Percentage shall be 19%. For fiscal year 2003,
7    the Annual Percentage shall be 27%. For fiscal year 2004,
8    the Annual Percentage shall be 32%. Upon the effective date
9    of this amendatory Act of the 93rd General Assembly, the
10    Annual Percentage shall be 24% for fiscal year 2005. For
11    fiscal year 2006, the Annual Percentage shall be 20%. For
12    fiscal year 2007, the Annual Percentage shall be 17.5%. For
13    fiscal year 2008, the Annual Percentage shall be 15.5%. For
14    fiscal year 2009, the Annual Percentage shall be 17.5%. For
15    fiscal year 2010, the Annual Percentage shall be 17.5%. For
16    fiscal year 2011, the Annual Percentage shall be 17.5%. For
17    all other fiscal years, the Annual Percentage shall be
18    calculated as a fraction, the numerator of which shall be
19    the amount of refunds approved for payment by the
20    Department during the preceding fiscal year as a result of
21    overpayment of tax liability under subsections (a) and
22    (b)(6), (7), and (8), (c) and (d) of Section 201 of this
23    Act plus the amount of such refunds remaining approved but
24    unpaid at the end of the preceding fiscal year, and the
25    denominator of which shall be the amounts which will be
26    collected pursuant to subsections (a) and (b)(6), (7), and

 

 

SB0078- 55 -LRB097 05759 HLH 45823 b

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

 

 

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

 

 

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1        (4.5) As soon as possible after the end of fiscal year
2    1999 and of each fiscal year thereafter, the Director shall
3    order transferred and the State Treasurer and State
4    Comptroller shall transfer from the Income Tax Refund Fund
5    to the General Revenue Fund any surplus remaining in the
6    Income Tax Refund Fund as of the end of such fiscal year;
7    excluding for fiscal years 2000, 2001, and 2002 amounts
8    attributable to transfers under item (3) of subsection (c)
9    less refunds resulting from the earned income tax credit.
10        (5) This Act shall constitute an irrevocable and
11    continuing appropriation from the Income Tax Refund Fund
12    for the purpose of paying refunds upon the order of the
13    Director in accordance with the provisions of this Section.
14    (e) Deposits into the Education Assistance Fund and the
15Income Tax Surcharge Local Government Distributive Fund.
16    On July 1, 1991, and thereafter, of the amounts collected
17pursuant to subsections (a) and (b) of Section 201 of this Act,
18minus deposits into the Income Tax Refund Fund, the Department
19shall deposit 7.3% into the Education Assistance Fund in the
20State Treasury. Beginning July 1, 1991, and continuing through
21January 31, 1993, of the amounts collected pursuant to
22subsections (a) and (b) of Section 201 of the Illinois Income
23Tax Act, minus deposits into the Income Tax Refund Fund, the
24Department shall deposit 3.0% into the Income Tax Surcharge
25Local Government Distributive Fund in the State Treasury.
26Beginning February 1, 1993 and continuing through June 30,

 

 

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11993, of the amounts collected pursuant to subsections (a) and
2(b) of Section 201 of the Illinois Income Tax Act, minus
3deposits into the Income Tax Refund Fund, the Department shall
4deposit 4.4% into the Income Tax Surcharge Local Government
5Distributive Fund in the State Treasury. Beginning July 1,
61993, and continuing through June 30, 1994, of the amounts
7collected under subsections (a) and (b) of Section 201 of this
8Act, minus deposits into the Income Tax Refund Fund, the
9Department shall deposit 1.475% into the Income Tax Surcharge
10Local Government Distributive Fund in the State Treasury.
11    (f) (Blank). Deposits into the Fund for the Advancement of
12Education. Beginning February 1, 2015, the Department shall
13deposit the following portions of the revenue realized from the
14tax imposed upon individuals, trusts, and estates by
15subsections (a) and (b) of Section 201 of this Act during the
16preceding month, minus deposits into the Income Tax Refund
17Fund, into the Fund for the Advancement of Education:
18        (1) beginning February 1, 2015, and prior to February
19    1, 2025, 1/30; and
20        (2) beginning February 1, 2025, 1/26.
21    If the rate of tax imposed by subsection (a) and (b) of
22Section 201 is reduced pursuant to Section 201.5 of this Act,
23the Department shall not make the deposits required by this
24subsection (f) on or after the effective date of the reduction.
25    (g) (Blank). Deposits into the Commitment to Human Services
26Fund. Beginning February 1, 2015, the Department shall deposit

 

 

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1the following portions of the revenue realized from the tax
2imposed upon individuals, trusts, and estates by subsections
3(a) and (b) of Section 201 of this Act during the preceding
4month, minus deposits into the Income Tax Refund Fund, into the
5Commitment to Human Services Fund:
6        (1) beginning February 1, 2015, and prior to February
7    1, 2025, 1/30; and
8        (2) beginning February 1, 2025, 1/26.
9    If the rate of tax imposed by subsection (a) and (b) of
10Section 201 is reduced pursuant to Section 201.5 of this Act,
11the Department shall not make the deposits required by this
12subsection (g) on or after the effective date of the reduction.
13(Source: P.A. 95-707, eff. 1-11-08; 95-744, eff. 7-18-08;
1496-45, eff. 7-15-09; 96-328, eff. 8-11-09; 96-959, eff. 7-1-10;
1509600SB2505enr.)
 
16    Section 15. If and only if Senate Bill 2505 of the 96th
17General Assembly becomes law, then the Illinois Estate and
18Generation-Skipping Transfer Tax Act is amended by changing
19Section 2 as follows:
 
20    (35 ILCS 405/2)  (from Ch. 120, par. 405A-2)
21    Sec. 2. Definitions.
22    "Federal estate tax" means the tax due to the United States
23with respect to a taxable transfer under Chapter 11 of the
24Internal Revenue Code.

 

 

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

 

 

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1    "Resident trust" means a trust that is a resident of this
2State for purposes of the Illinois Income Tax Act, as amended
3from time to time.
4    "State" means any state, territory or possession of the
5United States and the District of Columbia.
6    "State tax credit" means:
7    (a) For persons dying on or after January 1, 2003 and
8through December 31, 2005, an amount equal to the full credit
9calculable under Section 2011 or Section 2604 of the Internal
10Revenue Code as the credit would have been computed and allowed
11under the Internal Revenue Code as in effect on December 31,
122001, without the reduction in the State Death Tax Credit as
13provided in Section 2011(b)(2) or the termination of the State
14Death Tax Credit as provided in Section 2011(f) as enacted by
15the Economic Growth and Tax Relief Reconciliation Act of 2001,
16but recognizing the increased applicable exclusion amount
17through December 31, 2005.
18    (b) For persons dying after December 31, 2005 and on or
19before December 31, 2009, and for persons dying after December
2031, 2010, an amount equal to the full credit calculable under
21Section 2011 or 2604 of the Internal Revenue Code as the credit
22would have been computed and allowed under the Internal Revenue
23Code as in effect on December 31, 2001, without the reduction
24in the State Death Tax Credit as provided in Section 2011(b)(2)
25or the termination of the State Death Tax Credit as provided in
26Section 2011(f) as enacted by the Economic Growth and Tax

 

 

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1Relief Reconciliation Act of 2001, but recognizing the
2exclusion amount of only $2,000,000, and with reduction to the
3adjusted taxable estate for any qualified terminable interest
4property election as defined in subsection (b-1) of this
5Section.
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    (c) For persons dying after December 31, 2009, the credit
22for state tax allowable under Section 2011 or Section 2604 of
23the Internal Revenue Code.
24    "Taxable transfer" means an event that gives rise to a
25state tax credit, including any credit as a result of the
26imposition of an additional tax under Section 2032A(c) of the

 

 

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1Internal Revenue Code.
2    "Transferee" means a transferee within the meaning of
3Section 2603(a)(1) and Section 6901(h) of the Internal Revenue
4Code.
5    "Transferred property" means:
6        (1) With respect to a taxable transfer occurring at the
7    death of an individual, the deceased individual's gross
8    estate as defined in Section 2031 of the Internal Revenue
9    Code.
10        (2) With respect to a taxable transfer occurring as a
11    result of a taxable termination as defined in Section
12    2612(a) of the Internal Revenue Code, the taxable amount
13    determined under Section 2622(a) of the Internal Revenue
14    Code.
15        (3) With respect to a taxable transfer occurring as a
16    result of a taxable distribution as defined in Section
17    2612(b) of the Internal Revenue Code, the taxable amount
18    determined under Section 2621(a) of the Internal Revenue
19    Code.
20        (4) With respect to an event which causes the
21    imposition of an additional estate tax under Section
22    2032A(c) of the Internal Revenue Code, the qualified real
23    property that was disposed of or which ceased to be used
24    for the qualified use, within the meaning of Section
25    2032A(c)(1) of the Internal Revenue Code.
26    "Trust" includes a trust as defined in Section 2652(b)(1)

 

 

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1of the Internal Revenue Code.
2(Source: P.A. 96-789, eff. 9-8-09; 09600SB2505enr.)
 
3    (30 ILCS 5/3-20 rep.)
4    Section 20. If and only if Senate Bill 2505 of the 96th
5General Assembly becomes law, then the Illinois State Auditing
6Act is amended by repealing Section 3-20 as added by Senate
7Bill 2505 of the 96th General Assembly.
 
8    (30 ILCS 105/5.786 rep.)
9    (30 ILCS 105/5.787 rep.)
10    (30 ILCS 105/6z-85 rep.)
11    (30 ILCS 105/6z-86 rep.)
12    (30 ILCS 105/25.2 rep.)
13    Section 25. If and only if Senate Bill 2505 of the 96th
14General Assembly becomes law, then the State Finance Act is
15amended by repealing Sections 5.786, 5.787, 6z-85, 6z-86, and
1625.2 as added by Senate Bill 2505 of the 96th General Assembly.
 
17    (35 ILCS 5/201.5 rep.)
18    (35 ILCS 5/202.5 rep.)
19    Section 30. If and only if Senate Bill 2505 of the 96th
20General Assembly becomes law, then the Illinois Income Tax Act
21is amended by repealing Sections 201.5 and 202.5 as added by
22Senate Bill 2505 of the 96th General Assembly.
 
23    Section 99. Effective date. This Act takes effect upon

 

 

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1becoming law.

 

 

SB0078- 66 -LRB097 05759 HLH 45823 b

1 INDEX
2 Statutes amended in order of appearance
3    15 ILCS 305/5from Ch. 124, par. 5
4    35 ILCS 5/201from Ch. 120, par. 2-201
5    35 ILCS 5/207from Ch. 120, par. 2-207
6    35 ILCS 5/804from Ch. 120, par. 8-804
7    35 ILCS 5/901from Ch. 120, par. 9-901
8    35 ILCS 405/2from Ch. 120, par. 405A-2
9    30 ILCS 5/3-20 rep.
10    30 ILCS 105/5.786 rep.
11    30 ILCS 105/5.787 rep.
12    30 ILCS 105/6z-85 rep.
13    30 ILCS 105/6z-86 rep.
14    30 ILCS 105/25.2 rep.
15    35 ILCS 5/201.5 rep.
16    35 ILCS 5/202.5 rep.