HB3144 98TH GENERAL ASSEMBLY

LRB098 07398 HLH 37462 b

98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
HB3144

Introduced , by Rep. Thaddeus Jones

SYNOPSIS AS INTRODUCED:

35 ILCS 5/224 new

Amends the Illinois Income Tax Act. Provides that, for taxable years beginning on or after January 1, 2014, each business that is first located in the State during the taxable year is entitled to a credit in an amount equal to 10% of the wages paid to qualified employees during the taxpayer's first year of business in the State. Provides that the term "qualified employee" means a full-time employee of the taxpayer who is a resident of the State and not more than a 5% shareholder, partner, member, or owner of the taxpayer. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Income Tax Act is amended by adding Section 224 as follows:

(35 ILCS 5/224 new)

Sec. 224. New business credit.

(a) For taxable years beginning on or after January 1, 2014, each business that is first located in the State during the taxable year is entitled to a credit against the tax tax imposed under subsections (a) and (b) of this Section in an amount equal to 10% of the wages paid to qualified employees during the taxpayer's first year of business in the State. For the purposes of this Section, "qualified employee" means a full-time employee of the taxpayer who is a resident of the State and not more than a 5% shareholder, partner, member, or owner of the taxpayer.

(b) The tax credit may not reduce the taxpayer's liability to less than zero. If the amount of the tax credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit must be applied to the earliest year for which there is a tax liability. If there are credits from more than one tax year that are available to offset a liability, then the earlier credit must be applied first.

(c) If the Taxpayer is a partnership or Subchapter S corporation, the credit shall be allowed to the partners or shareholders in accordance with the determination of income and distributive share of income under Sections 702 and 704 and subchapter S of the Internal Revenue Code.

(d) This Section is exempt from the provisions of Section 250.

Section 99. Effective date. This Act takes effect upon becoming law.