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Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.

REVENUE
(35 ILCS 5/) Illinois Income Tax Act.

35 ILCS 5/Art. 1

 
    (35 ILCS 5/Art. 1 heading)
ARTICLE 1. SHORT TITLE AND CONSTRUCTION.

35 ILCS 5/101

    (35 ILCS 5/101) (from Ch. 120, par. 1-101)
    Sec. 101. Short Title.
    This Act shall be known and may be cited as the "Illinois Income Tax Act."
(Source: P.A. 76-261.)

35 ILCS 5/102

    (35 ILCS 5/102) (from Ch. 120, par. 1-102)
    Sec. 102. Construction.
    Except as otherwise expressly provided or clearly appearing from the context, any term used in this Act shall have the same meaning as when used in a comparable context in the United States Internal Revenue Code of 1954 or any successor law or laws relating to federal income taxes and other provisions of the statutes of the United States relating to federal income taxes as such Code, laws and statutes are in effect for the taxable year.
(Source: P.A. 77-726.)

35 ILCS 5/103

    (35 ILCS 5/103) (from Ch. 120, par. 1-103)
    Sec. 103. Renumbered Internal Revenue Code Provisions. If a provision of the United States Internal Revenue Code is specifically mentioned by number in a provision of this Act and if after the effective date of the legislation that established such reference the Internal Revenue Code provision thus referred to is, by amendment, renumbered without any other change whatever being made to it, then the provision of this Act containing such reference shall be construed as though the renumbering of the provision of the United States Internal Revenue Code had not occurred.
(Source: P.A. 86-678.)

35 ILCS 5/Art. 2

 
    (35 ILCS 5/Art. 2 heading)
ARTICLE 2. TAX IMPOSED

35 ILCS 5/201

    (35 ILCS 5/201) (from Ch. 120, par. 2-201)
    Sec. 201. Tax Imposed.
    (a) In general. A tax measured by net income is hereby imposed on every individual, corporation, trust and estate for each taxable year ending after July 31, 1969 on the privilege of earning or receiving income in or as a resident of this State. Such tax shall be in addition to all other occupation or privilege taxes imposed by this State or by any municipal corporation or political subdivision thereof.
    (b) Rates. The tax imposed by subsection (a) of this Section shall be determined as follows, except as adjusted by subsection (d-1):
        (1) In the case of an individual, trust or estate,
    
for taxable years ending prior to July 1, 1989, an amount equal to 2 1/2% of the taxpayer's net income for the taxable year.
        (2) In the case of an individual, trust or estate,
    
for taxable years beginning prior to July 1, 1989 and ending after June 30, 1989, an amount equal to the sum of (i) 2 1/2% of the taxpayer's net income for the period prior to July 1, 1989, as calculated under Section 202.3, and (ii) 3% of the taxpayer's net income for the period after June 30, 1989, as calculated under Section 202.3.
        (3) In the case of an individual, trust or estate,
    
for taxable years beginning after June 30, 1989, and ending prior to January 1, 2011, an amount equal to 3% of the taxpayer's net income for the taxable year.
        (4) In the case of an individual, trust, or estate,
    
for taxable years beginning prior to January 1, 2011, and ending after December 31, 2010, an amount equal to the sum of (i) 3% of the taxpayer's net income for the period prior to January 1, 2011, as calculated under Section 202.5, and (ii) 5% of the taxpayer's net income for the period after December 31, 2010, as calculated under Section 202.5.
        (5) In the case of an individual, trust, or estate,
    
for taxable years beginning on or after January 1, 2011, and ending prior to January 1, 2015, an amount equal to 5% of the taxpayer's net income for the taxable year.
        (5.1) In the case of an individual, trust, or estate,
    
for taxable years beginning prior to January 1, 2015, and ending after December 31, 2014, an amount equal to the sum of (i) 5% of the taxpayer's net income for the period prior to January 1, 2015, as calculated under Section 202.5, and (ii) 3.75% of the taxpayer's net income for the period after December 31, 2014, as calculated under Section 202.5.
        (5.2) In the case of an individual, trust, or estate,
    
for taxable years beginning on or after January 1, 2015, and ending prior to January 1, 2025, an amount equal to 3.75% of the taxpayer's net income for the taxable year.
        (5.3) In the case of an individual, trust, or estate,
    
for taxable years beginning prior to January 1, 2025, and ending after December 31, 2024, an amount equal to the sum of (i) 3.75% of the taxpayer's net income for the period prior to January 1, 2025, as calculated under Section 202.5, and (ii) 3.25% of the taxpayer's net income for the period after December 31, 2024, as calculated under Section 202.5.
        (5.4) In the case of an individual, trust, or estate,
    
for taxable years beginning on or after January 1, 2025, an amount equal to 3.25% of the taxpayer's net income for the taxable year.
        (6) In the case of a corporation, for taxable years
    
ending prior to July 1, 1989, an amount equal to 4% of the taxpayer's net income for the taxable year.
        (7) In the case of a corporation, for taxable years
    
beginning prior to July 1, 1989 and ending after June 30, 1989, an amount equal to the sum of (i) 4% of the taxpayer's net income for the period prior to July 1, 1989, as calculated under Section 202.3, and (ii) 4.8% of the taxpayer's net income for the period after June 30, 1989, as calculated under Section 202.3.
        (8) In the case of a corporation, for taxable years
    
beginning after June 30, 1989, and ending prior to January 1, 2011, an amount equal to 4.8% of the taxpayer's net income for the taxable year.
        (9) In the case of a corporation, for taxable years
    
beginning prior to January 1, 2011, and ending after December 31, 2010, an amount equal to the sum of (i) 4.8% of the taxpayer's net income for the period prior to January 1, 2011, as calculated under Section 202.5, and (ii) 7% of the taxpayer's net income for the period after December 31, 2010, as calculated under Section 202.5.
        (10) In the case of a corporation, for taxable years
    
beginning on or after January 1, 2011, and ending prior to January 1, 2015, an amount equal to 7% of the taxpayer's net income for the taxable year.
        (11) In the case of a corporation, for taxable years
    
beginning prior to January 1, 2015, and ending after December 31, 2014, an amount equal to the sum of (i) 7% of the taxpayer's net income for the period prior to January 1, 2015, as calculated under Section 202.5, and (ii) 5.25% of the taxpayer's net income for the period after December 31, 2014, as calculated under Section 202.5.
        (12) In the case of a corporation, for taxable years
    
beginning on or after January 1, 2015, and ending prior to January 1, 2025, an amount equal to 5.25% of the taxpayer's net income for the taxable year.
        (13) In the case of a corporation, for taxable years
    
beginning prior to January 1, 2025, and ending after December 31, 2024, an amount equal to the sum of (i) 5.25% of the taxpayer's net income for the period prior to January 1, 2025, as calculated under Section 202.5, and (ii) 4.8% of the taxpayer's net income for the period after December 31, 2024, as calculated under Section 202.5.
        (14) In the case of a corporation, for taxable years
    
beginning on or after January 1, 2025, an amount equal to 4.8% of the taxpayer's net income for the taxable year.
    The rates under this subsection (b) are subject to the provisions of Section 201.5.
    (c) Personal Property Tax Replacement Income Tax. Beginning on July 1, 1979 and thereafter, in addition to such income tax, there is also hereby imposed the Personal Property Tax Replacement Income Tax measured by net income on every corporation (including Subchapter S corporations), partnership and trust, for each taxable year ending after June 30, 1979. Such taxes are imposed on the privilege of earning or receiving income in or as a resident of this State. The Personal Property Tax Replacement Income Tax shall be in addition to the income tax imposed by subsections (a) and (b) of this Section and in addition to all other occupation or privilege taxes imposed by this State or by any municipal corporation or political subdivision thereof.
    (d) Additional Personal Property Tax Replacement Income Tax Rates. The personal property tax replacement income tax imposed by this subsection and subsection (c) of this Section in the case of a corporation, other than a Subchapter S corporation and except as adjusted by subsection (d-1), shall be an additional amount equal to 2.85% of such taxpayer's net income for the taxable year, except that beginning on January 1, 1981, and thereafter, the rate of 2.85% specified in this subsection shall be reduced to 2.5%, and in the case of a partnership, trust or a Subchapter S corporation shall be an additional amount equal to 1.5% of such taxpayer's net income for the taxable year.
    (d-1) Rate reduction for certain foreign insurers. In the case of a foreign insurer, as defined by Section 35A-5 of the Illinois Insurance Code, whose state or country of domicile imposes on insurers domiciled in Illinois a retaliatory tax (excluding any insurer whose premiums from reinsurance assumed are 50% or more of its total insurance premiums as determined under paragraph (2) of subsection (b) of Section 304, except that for purposes of this determination premiums from reinsurance do not include premiums from inter-affiliate reinsurance arrangements), beginning with taxable years ending on or after December 31, 1999, the sum of the rates of tax imposed by subsections (b) and (d) shall be reduced (but not increased) to the rate at which the total amount of tax imposed under this Act, net of all credits allowed under this Act, shall equal (i) the total amount of tax that would be imposed on the foreign insurer's net income allocable to Illinois for the taxable year by such foreign insurer's state or country of domicile if that net income were subject to all income taxes and taxes measured by net income imposed by such foreign insurer's state or country of domicile, net of all credits allowed or (ii) a rate of zero if no such tax is imposed on such income by the foreign insurer's state of domicile. For the purposes of this subsection (d-1), an inter-affiliate includes a mutual insurer under common management.
        (1) For the purposes of subsection (d-1), in no event
    
shall the sum of the rates of tax imposed by subsections (b) and (d) be reduced below the rate at which the sum of:
            (A) the total amount of tax imposed on such
        
foreign insurer under this Act for a taxable year, net of all credits allowed under this Act, plus
            (B) the privilege tax imposed by Section 409 of
        
the Illinois Insurance Code, the fire insurance company tax imposed by Section 12 of the Fire Investigation Act, and the fire department taxes imposed under Section 11-10-1 of the Illinois Municipal Code,
    equals 1.25% for taxable years ending prior to December
    
31, 2003, or 1.75% for taxable years ending on or after December 31, 2003, of the net taxable premiums written for the taxable year, as described by subsection (1) of Section 409 of the Illinois Insurance Code. This paragraph will in no event increase the rates imposed under subsections (b) and (d).
        (2) Any reduction in the rates of tax imposed by this
    
subsection shall be applied first against the rates imposed by subsection (b) and only after the tax imposed by subsection (a) net of all credits allowed under this Section other than the credit allowed under subsection (i) has been reduced to zero, against the rates imposed by subsection (d).
    This subsection (d-1) is exempt from the provisions of Section 250.
    (e) Investment credit. A taxpayer shall be allowed a credit against the Personal Property Tax Replacement Income Tax for investment in qualified property.
        (1) A taxpayer shall be allowed a credit equal to .5%
    
of the basis of qualified property placed in service during the taxable year, provided such property is placed in service on or after July 1, 1984. There shall be allowed an additional credit equal to .5% of the basis of qualified property placed in service during the taxable year, provided such property is placed in service on or after July 1, 1986, and the taxpayer's base employment within Illinois has increased by 1% or more over the preceding year as determined by the taxpayer's employment records filed with the Illinois Department of Employment Security. Taxpayers who are new to Illinois shall be deemed to have met the 1% growth in base employment for the first year in which they file employment records with the Illinois Department of Employment Security. The provisions added to this Section by Public Act 85-1200 (and restored by Public Act 87-895) shall be construed as declaratory of existing law and not as a new enactment. If, in any year, the increase in base employment within Illinois over the preceding year is less than 1%, the additional credit shall be limited to that percentage times a fraction, the numerator of which is .5% and the denominator of which is 1%, but shall not exceed .5%. The investment credit shall not be allowed to the extent that it would reduce a taxpayer's liability in any tax year below zero, nor may any credit for qualified property be allowed for any year other than the year in which the property was placed in service in Illinois. For tax years ending on or after December 31, 1987, and on or before December 31, 1988, the credit shall be allowed for the tax year in which the property is placed in service, or, if the amount of the credit exceeds the tax liability for that year, whether it exceeds the original liability or the liability as later amended, such excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit years if the taxpayer (i) makes investments which cause the creation of a minimum of 2,000 full-time equivalent jobs in Illinois, (ii) is located in an enterprise zone established pursuant to the Illinois Enterprise Zone Act and (iii) is certified by the Department of Commerce and Community Affairs (now Department of Commerce and Economic Opportunity) as complying with the requirements specified in clause (i) and (ii) by July 1, 1986. The Department of Commerce and Community Affairs (now Department of Commerce and Economic Opportunity) shall notify the Department of Revenue of all such certifications immediately. For tax years ending after December 31, 1988, the credit shall be allowed for the tax year in which the property is placed in service, or, if the amount of the credit exceeds the tax liability for that year, whether it exceeds the original liability or the liability as later amended, such excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit years. The credit shall be applied to the earliest year for which there is a liability. If there is credit from more than one tax year that is available to offset a liability, earlier credit shall be applied first.
        (2) The term "qualified property" means property
    
which:
            (A) is tangible, whether new or used, including
        
buildings and structural components of buildings and signs that are real property, but not including land or improvements to real property that are not a structural component of a building such as landscaping, sewer lines, local access roads, fencing, parking lots, and other appurtenances;
            (B) is depreciable pursuant to Section 167 of the
        
Internal Revenue Code, except that "3-year property" as defined in Section 168(c)(2)(A) of that Code is not eligible for the credit provided by this subsection (e);
            (C) is acquired by purchase as defined in Section
        
179(d) of the Internal Revenue Code;
            (D) is used in Illinois by a taxpayer who is
        
primarily engaged in manufacturing, or in mining coal or fluorite, or in retailing, or was placed in service on or after July 1, 2006 in a River Edge Redevelopment Zone established pursuant to the River Edge Redevelopment Zone Act; and
            (E) has not previously been used in Illinois in
        
such a manner and by such a person as would qualify for the credit provided by this subsection (e) or subsection (f).
        (3) For purposes of this subsection (e),
    
"manufacturing" means the material staging and production of tangible personal property by procedures commonly regarded as manufacturing, processing, fabrication, or assembling which changes some existing material into new shapes, new qualities, or new combinations. For purposes of this subsection (e) the term "mining" shall have the same meaning as the term "mining" in Section 613(c) of the Internal Revenue Code. For purposes of this subsection (e), the term "retailing" means the sale of tangible personal property for use or consumption and not for resale, or services rendered in conjunction with the sale of tangible personal property for use or consumption and not for resale. For purposes of this subsection (e), "tangible personal property" has the same meaning as when that term is used in the Retailers' Occupation Tax Act, and, for taxable years ending after December 31, 2008, does not include the generation, transmission, or distribution of electricity.
        (4) The basis of qualified property shall be the
    
basis used to compute the depreciation deduction for federal income tax purposes.
        (5) If the basis of the property for federal income
    
tax depreciation purposes is increased after it has been placed in service in Illinois by the taxpayer, the amount of such increase shall be deemed property placed in service on the date of such increase in basis.
        (6) The term "placed in service" shall have the same
    
meaning as under Section 46 of the Internal Revenue Code.
        (7) If during any taxable year, any property ceases
    
to be qualified property in the hands of the taxpayer within 48 months after being placed in service, or the situs of any qualified property is moved outside Illinois within 48 months after being placed in service, the Personal Property Tax Replacement Income Tax for such taxable year shall be increased. Such increase shall be determined by (i) recomputing the investment credit which would have been allowed for the year in which credit for such property was originally allowed by eliminating such property from such computation and, (ii) subtracting such recomputed credit from the amount of credit previously allowed. For the purposes of this paragraph (7), a reduction of the basis of qualified property resulting from a redetermination of the purchase price shall be deemed a disposition of qualified property to the extent of such reduction.
        (8) Unless the investment credit is extended by law,
    
the basis of qualified property shall not include costs incurred after December 31, 2018, except for costs incurred pursuant to a binding contract entered into on or before December 31, 2018.
        (9) Each taxable year ending before December 31,
    
2000, a partnership may elect to pass through to its partners the credits to which the partnership is entitled under this subsection (e) for the taxable year. A partner may use the credit allocated to him or her under this paragraph only against the tax imposed in subsections (c) and (d) of this Section. If the partnership makes that election, those credits shall be allocated among the partners in the partnership in accordance with the rules set forth in Section 704(b) of the Internal Revenue Code, and the rules promulgated under that Section, and the allocated amount of the credits shall be allowed to the partners for that taxable year. The partnership shall make this election on its Personal Property Tax Replacement Income Tax return for that taxable year. The election to pass through the credits shall be irrevocable.
        For taxable years ending on or after December 31,
    
2000, a partner that qualifies its partnership for a subtraction under subparagraph (I) of paragraph (2) of subsection (d) of Section 203 or a shareholder that qualifies a Subchapter S corporation for a subtraction under subparagraph (S) of paragraph (2) of subsection (b) of Section 203 shall be allowed a credit under this subsection (e) equal to its share of the credit earned under this subsection (e) during the taxable year by the partnership or Subchapter S corporation, determined 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. This paragraph is exempt from the provisions of Section 250.
    (f) Investment credit; Enterprise Zone; River Edge Redevelopment Zone.
        (1) A taxpayer shall be allowed a credit against the
    
tax imposed by subsections (a) and (b) of this Section for investment in qualified property which is placed in service in an Enterprise Zone created pursuant to the Illinois Enterprise Zone Act or, for property placed in service on or after July 1, 2006, a River Edge Redevelopment Zone established pursuant to the River Edge Redevelopment Zone Act. For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this subsection (f) to be determined 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. The credit shall be .5% of the basis for such property. The credit shall be available only in the taxable year in which the property is placed in service in the Enterprise Zone or River Edge Redevelopment Zone and shall not be allowed to the extent that it would reduce a taxpayer's liability for the tax imposed by subsections (a) and (b) of this Section to below zero. For tax years ending on or after December 31, 1985, the credit shall be allowed for the tax year in which the property is placed in service, or, if the amount of the credit exceeds the tax liability for that year, whether it exceeds the original liability or the liability as later amended, such excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a liability. If there is credit from more than one tax year that is available to offset a liability, the credit accruing first in time shall be applied first.
        (2) The term qualified property means property which:
            (A) is tangible, whether new or used, including
        
buildings and structural components of buildings;
            (B) is depreciable pursuant to Section 167 of the
        
Internal Revenue Code, except that "3-year property" as defined in Section 168(c)(2)(A) of that Code is not eligible for the credit provided by this subsection (f);
            (C) is acquired by purchase as defined in Section
        
179(d) of the Internal Revenue Code;
            (D) is used in the Enterprise Zone or River Edge
        
Redevelopment Zone by the taxpayer; and
            (E) has not been previously used in Illinois in
        
such a manner and by such a person as would qualify for the credit provided by this subsection (f) or subsection (e).
        (3) The basis of qualified property shall be the
    
basis used to compute the depreciation deduction for federal income tax purposes.
        (4) If the basis of the property for federal income
    
tax depreciation purposes is increased after it has been placed in service in the Enterprise Zone or River Edge Redevelopment Zone by the taxpayer, the amount of such increase shall be deemed property placed in service on the date of such increase in basis.
        (5) The term "placed in service" shall have the same
    
meaning as under Section 46 of the Internal Revenue Code.
        (6) If during any taxable year, any property ceases
    
to be qualified property in the hands of the taxpayer within 48 months after being placed in service, or the situs of any qualified property is moved outside the Enterprise Zone or River Edge Redevelopment Zone within 48 months after being placed in service, the tax imposed under subsections (a) and (b) of this Section for such taxable year shall be increased. Such increase shall be determined by (i) recomputing the investment credit which would have been allowed for the year in which credit for such property was originally allowed by eliminating such property from such computation, and (ii) subtracting such recomputed credit from the amount of credit previously allowed. For the purposes of this paragraph (6), a reduction of the basis of qualified property resulting from a redetermination of the purchase price shall be deemed a disposition of qualified property to the extent of such reduction.
        (7) There shall be allowed an additional credit equal
    
to 0.5% of the basis of qualified property placed in service during the taxable year in a River Edge Redevelopment Zone, provided such property is placed in service on or after July 1, 2006, and the taxpayer's base employment within Illinois has increased by 1% or more over the preceding year as determined by the taxpayer's employment records filed with the Illinois Department of Employment Security. Taxpayers who are new to Illinois shall be deemed to have met the 1% growth in base employment for the first year in which they file employment records with the Illinois Department of Employment Security. If, in any year, the increase in base employment within Illinois over the preceding year is less than 1%, the additional credit shall be limited to that percentage times a fraction, the numerator of which is 0.5% and the denominator of which is 1%, but shall not exceed 0.5%.
    (g) (Blank).
    (h) Investment credit; High Impact Business.
        (1) Subject to subsections (b) and (b-5) of Section
    
5.5 of the Illinois Enterprise Zone Act, a taxpayer shall be allowed a credit against the tax imposed by subsections (a) and (b) of this Section for investment in qualified property which is placed in service by a Department of Commerce and Economic Opportunity designated High Impact Business. The credit shall be .5% of the basis for such property. The credit shall not be available (i) until the minimum investments in qualified property set forth in subdivision (a)(3)(A) of Section 5.5 of the Illinois Enterprise Zone Act have been satisfied or (ii) until the time authorized in subsection (b-5) of the Illinois Enterprise Zone Act for entities designated as High Impact Businesses under subdivisions (a)(3)(B), (a)(3)(C), and (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone Act, and shall not be allowed to the extent that it would reduce a taxpayer's liability for the tax imposed by subsections (a) and (b) of this Section to below zero. The credit applicable to such investments shall be taken in the taxable year in which such investments have been completed. The credit for additional investments beyond the minimum investment by a designated high impact business authorized under subdivision (a)(3)(A) of Section 5.5 of the Illinois Enterprise Zone Act shall be available only in the taxable year in which the property is placed in service and shall not be allowed to the extent that it would reduce a taxpayer's liability for the tax imposed by subsections (a) and (b) of this Section to below zero. For tax years ending on or after December 31, 1987, the credit shall be allowed for the tax year in which the property is placed in service, or, if the amount of the credit exceeds the tax liability for that year, whether it exceeds the original liability or the liability as later amended, such excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a liability. If there is credit from more than one tax year that is available to offset a liability, the credit accruing first in time shall be applied first.
        Changes made in this subdivision (h)(1) by Public Act
    
88-670 restore changes made by Public Act 85-1182 and reflect existing law.
        (2) The term qualified property means property which:
            (A) is tangible, whether new or used, including
        
buildings and structural components of buildings;
            (B) is depreciable pursuant to Section 167 of the
        
Internal Revenue Code, except that "3-year property" as defined in Section 168(c)(2)(A) of that Code is not eligible for the credit provided by this subsection (h);
            (C) is acquired by purchase as defined in Section
        
179(d) of the Internal Revenue Code; and
            (D) is not eligible for the Enterprise Zone
        
Investment Credit provided by subsection (f) of this Section.
        (3) The basis of qualified property shall be the
    
basis used to compute the depreciation deduction for federal income tax purposes.
        (4) If the basis of the property for federal income
    
tax depreciation purposes is increased after it has been placed in service in a federally designated Foreign Trade Zone or Sub-Zone located in Illinois by the taxpayer, the amount of such increase shall be deemed property placed in service on the date of such increase in basis.
        (5) The term "placed in service" shall have the same
    
meaning as under Section 46 of the Internal Revenue Code.
        (6) If during any taxable year ending on or before
    
December 31, 1996, any property ceases to be qualified property in the hands of the taxpayer within 48 months after being placed in service, or the situs of any qualified property is moved outside Illinois within 48 months after being placed in service, the tax imposed under subsections (a) and (b) of this Section for such taxable year shall be increased. Such increase shall be determined by (i) recomputing the investment credit which would have been allowed for the year in which credit for such property was originally allowed by eliminating such property from such computation, and (ii) subtracting such recomputed credit from the amount of credit previously allowed. For the purposes of this paragraph (6), a reduction of the basis of qualified property resulting from a redetermination of the purchase price shall be deemed a disposition of qualified property to the extent of such reduction.
        (7) Beginning with tax years ending after December
    
31, 1996, if a taxpayer qualifies for the credit under this subsection (h) and thereby is granted a tax abatement and the taxpayer relocates its entire facility in violation of the explicit terms and length of the contract under Section 18-183 of the Property Tax Code, the tax imposed under subsections (a) and (b) of this Section shall be increased for the taxable year in which the taxpayer relocated its facility by an amount equal to the amount of credit received by the taxpayer under this subsection (h).
    (i) Credit for Personal Property Tax Replacement Income Tax. For tax years ending prior to December 31, 2003, a credit shall be allowed against the tax imposed by subsections (a) and (b) of this Section for the tax imposed by subsections (c) and (d) of this Section. This credit shall be computed by multiplying the tax imposed by subsections (c) and (d) of this Section by a fraction, the numerator of which is base income allocable to Illinois and the denominator of which is Illinois base income, and further multiplying the product by the tax rate imposed by subsections (a) and (b) of this Section.
    Any credit earned on or after December 31, 1986 under this subsection which is unused in the year the credit is computed because it exceeds the tax liability imposed by subsections (a) and (b) for that year (whether it exceeds the original liability or the liability as later amended) may be carried forward and applied to the tax liability imposed by subsections (a) and (b) of the 5 taxable years following the excess credit year, provided that no credit may be carried forward to any year ending on or after December 31, 2003. This credit shall be applied first to the earliest year for which there is a liability. If there is a credit under this subsection from more than one tax year that is available to offset a liability the earliest credit arising under this subsection shall be applied first.
    If, during any taxable year ending on or after December 31, 1986, the tax imposed by subsections (c) and (d) of this Section for which a taxpayer has claimed a credit under this subsection (i) is reduced, the amount of credit for such tax shall also be reduced. Such reduction shall be determined by recomputing the credit to take into account the reduced tax imposed by subsections (c) and (d). If any portion of the reduced amount of credit has been carried to a different taxable year, an amended return shall be filed for such taxable year to reduce the amount of credit claimed.
    (j) Training expense credit. Beginning with tax years ending on or after December 31, 1986 and prior to December 31, 2003, a taxpayer shall be allowed a credit against the tax imposed by subsections (a) and (b) under this Section for all amounts paid or accrued, on behalf of all persons employed by the taxpayer in Illinois or Illinois residents employed outside of Illinois by a taxpayer, for educational or vocational training in semi-technical or technical fields or semi-skilled or skilled fields, which were deducted from gross income in the computation of taxable income. The credit against the tax imposed by subsections (a) and (b) shall be 1.6% of such training expenses. For partners, shareholders of subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this subsection (j) to be determined 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.
    Any credit allowed under this subsection which is unused in the year the credit is earned may be carried forward to each of the 5 taxable years following the year for which the credit is first computed until it is used. This credit shall be applied first to the earliest year for which there is a liability. If there is a credit under this subsection from more than one tax year that is available to offset a liability the earliest credit arising under this subsection shall be applied first. No carryforward credit may be claimed in any tax year ending on or after December 31, 2003.
    (k) Research and development credit. For tax years ending after July 1, 1990 and prior to December 31, 2003, and beginning again for tax years ending on or after December 31, 2004, and ending prior to January 1, 2016, a taxpayer shall be allowed a credit against the tax imposed by subsections (a) and (b) of this Section for increasing research activities in this State. The credit allowed against the tax imposed by subsections (a) and (b) shall be equal to 6 1/2% of the qualifying expenditures for increasing research activities in this State. For partners, shareholders of subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this subsection to be determined 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.
    For purposes of this subsection, "qualifying expenditures" means the qualifying expenditures as defined for the federal credit for increasing research activities which would be allowable under Section 41 of the Internal Revenue Code and which are conducted in this State, "qualifying expenditures for increasing research activities in this State" means the excess of qualifying expenditures for the taxable year in which incurred over qualifying expenditures for the base period, "qualifying expenditures for the base period" means the average of the qualifying expenditures for each year in the base period, and "base period" means the 3 taxable years immediately preceding the taxable year for which the determination is being made.
    Any credit in excess of the tax liability for the taxable year may be carried forward. A taxpayer may elect to have the unused credit shown on its final completed return carried over as a credit against the tax liability for the following 5 taxable years or until it has been fully used, whichever occurs first; provided that no credit earned in a tax year ending prior to December 31, 2003 may be carried forward to any year ending on or after December 31, 2003.
    If an unused credit is carried forward to a given year from 2 or more earlier years, that credit arising in the earliest year will be applied first against the tax liability for the given year. If a tax liability for the given year still remains, the credit from the next earliest year will then be applied, and so on, until all credits have been used or no tax liability for the given year remains. Any remaining unused credit or credits then will be carried forward to the next following year in which a tax liability is incurred, except that no credit can be carried forward to a year which is more than 5 years after the year in which the expense for which the credit is given was incurred.
    No inference shall be drawn from this amendatory Act of the 91st General Assembly in construing this Section for taxable years beginning before January 1, 1999.
    (l) Environmental Remediation Tax Credit.
        (i) For tax years ending after December 31, 1997 and
    
on or before December 31, 2001, a taxpayer shall be allowed a credit against the tax imposed by subsections (a) and (b) of this Section for certain amounts paid for unreimbursed eligible remediation costs, as specified in this subsection. For purposes of this Section, "unreimbursed eligible remediation costs" means costs approved by the Illinois Environmental Protection Agency ("Agency") under Section 58.14 of the Environmental Protection Act that were paid in performing environmental remediation at a site for which a No Further Remediation Letter was issued by the Agency and recorded under Section 58.10 of the Environmental Protection Act. The credit must be claimed for the taxable year in which Agency approval of the eligible remediation costs is granted. The credit is not available to any taxpayer if the taxpayer or any related party caused or contributed to, in any material respect, a release of regulated substances on, in, or under the site that was identified and addressed by the remedial action pursuant to the Site Remediation Program of the Environmental Protection Act. After the Pollution Control Board rules are adopted pursuant to the Illinois Administrative Procedure Act for the administration and enforcement of Section 58.9 of the Environmental Protection Act, determinations as to credit availability for purposes of this Section shall be made consistent with those rules. For purposes of this Section, "taxpayer" includes a person whose tax attributes the taxpayer has succeeded to under Section 381 of the Internal Revenue Code and "related party" includes the persons disallowed a deduction for losses by paragraphs (b), (c), and (f)(1) of Section 267 of the Internal Revenue Code by virtue of being a related taxpayer, as well as any of its partners. The credit allowed against the tax imposed by subsections (a) and (b) shall be equal to 25% of the unreimbursed eligible remediation costs in excess of $100,000 per site, except that the $100,000 threshold shall not apply to any site contained in an enterprise zone as determined by the Department of Commerce and Community Affairs (now Department of Commerce and Economic Opportunity). The total credit allowed shall not exceed $40,000 per year with a maximum total of $150,000 per site. For partners and shareholders of subchapter S corporations, there shall be allowed a credit under this subsection to be determined 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.
        (ii) A credit allowed under this subsection that is
    
unused in the year the credit is earned may be carried forward to each of the 5 taxable years following the year for which the credit is first earned until it is used. The term "unused credit" does not include any amounts of unreimbursed eligible remediation costs in excess of the maximum credit per site authorized under paragraph (i). This credit shall be applied first to the earliest year for which there is a liability. If there is a credit under this subsection from more than one tax year that is available to offset a liability, the earliest credit arising under this subsection shall be applied first. A credit allowed under this subsection may be sold to a buyer as part of a sale of all or part of the remediation site for which the credit was granted. The purchaser of a remediation site and the tax credit shall succeed to the unused credit and remaining carry-forward period of the seller. To perfect the transfer, the assignor shall record the transfer in the chain of title for the site and provide written notice to the Director of the Illinois Department of Revenue of the assignor's intent to sell the remediation site and the amount of the tax credit to be transferred as a portion of the sale. In no event may a credit be transferred to any taxpayer if the taxpayer or a related party would not be eligible under the provisions of subsection (i).
        (iii) For purposes of this Section, the term "site"
    
shall have the same meaning as under Section 58.2 of the Environmental Protection Act.
    (m) Education expense credit. Beginning with tax years ending after December 31, 1999, a taxpayer who is the custodian of one or more qualifying pupils shall be allowed a credit against the tax imposed by subsections (a) and (b) of this Section for qualified education expenses incurred on behalf of the qualifying pupils. The credit shall be equal to 25% of qualified education expenses, but in no event may the total credit under this subsection claimed by a family that is the custodian of qualifying pupils exceed $500. In no event shall a credit under this subsection reduce the taxpayer's liability under this Act to less than zero. This subsection is exempt from the provisions of Section 250 of this Act.
    For purposes of this subsection:
    "Qualifying pupils" means individuals who (i) are residents of the State of Illinois, (ii) are under the age of 21 at the close of the school year for which a credit is sought, and (iii) during the school year for which a credit is sought were full-time pupils enrolled in a kindergarten through twelfth grade education program at any school, as defined in this subsection.
    "Qualified education expense" means the amount incurred on behalf of a qualifying pupil in excess of $250 for tuition, book fees, and lab fees at the school in which the pupil is enrolled during the regular school year.
    "School" means any public or nonpublic elementary or secondary school in Illinois that is in compliance with Title VI of the Civil Rights Act of 1964 and attendance at which satisfies the requirements of Section 26-1 of the School Code, except that nothing shall be construed to require a child to attend any particular public or nonpublic school to qualify for the credit under this Section.
    "Custodian" means, with respect to qualifying pupils, an Illinois resident who is a parent, the parents, a legal guardian, or the legal guardians of the qualifying pupils.
    (n) River Edge Redevelopment Zone site remediation tax credit.
        (i) For tax years ending on or after December 31,
    
2006, a taxpayer shall be allowed a credit against the tax imposed by subsections (a) and (b) of this Section for certain amounts paid for unreimbursed eligible remediation costs, as specified in this subsection. For purposes of this Section, "unreimbursed eligible remediation costs" means costs approved by the Illinois Environmental Protection Agency ("Agency") under Section 58.14a of the Environmental Protection Act that were paid in performing environmental remediation at a site within a River Edge Redevelopment Zone for which a No Further Remediation Letter was issued by the Agency and recorded under Section 58.10 of the Environmental Protection Act. The credit must be claimed for the taxable year in which Agency approval of the eligible remediation costs is granted. The credit is not available to any taxpayer if the taxpayer or any related party caused or contributed to, in any material respect, a release of regulated substances on, in, or under the site that was identified and addressed by the remedial action pursuant to the Site Remediation Program of the Environmental Protection Act. Determinations as to credit availability for purposes of this Section shall be made consistent with rules adopted by the Pollution Control Board pursuant to the Illinois Administrative Procedure Act for the administration and enforcement of Section 58.9 of the Environmental Protection Act. For purposes of this Section, "taxpayer" includes a person whose tax attributes the taxpayer has succeeded to under Section 381 of the Internal Revenue Code and "related party" includes the persons disallowed a deduction for losses by paragraphs (b), (c), and (f)(1) of Section 267 of the Internal Revenue Code by virtue of being a related taxpayer, as well as any of its partners. The credit allowed against the tax imposed by subsections (a) and (b) shall be equal to 25% of the unreimbursed eligible remediation costs in excess of $100,000 per site.
        (ii) A credit allowed under this subsection that is
    
unused in the year the credit is earned may be carried forward to each of the 5 taxable years following the year for which the credit is first earned until it is used. This credit shall be applied first to the earliest year for which there is a liability. If there is a credit under this subsection from more than one tax year that is available to offset a liability, the earliest credit arising under this subsection shall be applied first. A credit allowed under this subsection may be sold to a buyer as part of a sale of all or part of the remediation site for which the credit was granted. The purchaser of a remediation site and the tax credit shall succeed to the unused credit and remaining carry-forward period of the seller. To perfect the transfer, the assignor shall record the transfer in the chain of title for the site and provide written notice to the Director of the Illinois Department of Revenue of the assignor's intent to sell the remediation site and the amount of the tax credit to be transferred as a portion of the sale. In no event may a credit be transferred to any taxpayer if the taxpayer or a related party would not be eligible under the provisions of subsection (i).
        (iii) For purposes of this Section, the term "site"
    
shall have the same meaning as under Section 58.2 of the Environmental Protection Act.
    (o) For each of taxable years during the Compassionate Use of Medical Cannabis Pilot Program, a surcharge is imposed on all taxpayers on income arising from the sale or exchange of capital assets, depreciable business property, real property used in the trade or business, and Section 197 intangibles of an organization registrant under the Compassionate Use of Medical Cannabis Pilot Program Act. The amount of the surcharge is equal to the amount of federal income tax liability for the taxable year attributable to those sales and exchanges. The surcharge imposed does not apply if:
        (1) the medical cannabis cultivation center
    
registration, medical cannabis dispensary registration, or the property of a registration is transferred as a result of any of the following:
            (A) bankruptcy, a receivership, or a debt
        
adjustment initiated by or against the initial registration or the substantial owners of the initial registration;
            (B) cancellation, revocation, or termination of
        
any registration by the Illinois Department of Public Health;
            (C) a determination by the Illinois Department of
        
Public Health that transfer of the registration is in the best interests of Illinois qualifying patients as defined by the Compassionate Use of Medical Cannabis Pilot Program Act;
            (D) the death of an owner of the equity interest
        
in a registrant;
            (E) the acquisition of a controlling interest in
        
the stock or substantially all of the assets of a publicly traded company;
            (F) a transfer by a parent company to a wholly
        
owned subsidiary; or
            (G) the transfer or sale to or by one person to
        
another person where both persons were initial owners of the registration when the registration was issued; or
        (2) the cannabis cultivation center registration,
    
medical cannabis dispensary registration, or the controlling interest in a registrant's property is transferred in a transaction to lineal descendants in which no gain or loss is recognized or as a result of a transaction in accordance with Section 351 of the Internal Revenue Code in which no gain or loss is recognized.
(Source: P.A. 97-2, eff. 5-6-11; 97-636, eff. 6-1-12; 97-905, eff. 8-7-12; 98-109, eff. 7-25-13; 98-122, eff. 1-1-14; 98-756, eff. 7-16-14.)

35 ILCS 5/201.5

    (35 ILCS 5/201.5)
    Sec. 201.5. State spending limitation and tax reduction.
    (a) If, beginning in State fiscal year 2012 and continuing through State fiscal year 2015, State spending for any fiscal year exceeds the State spending limitation set forth in subsection (b) of this Section, then the tax rates set forth in subsection (b) of Section 201 of this Act shall be reduced, according to the procedures set forth in this Section, to 3% of the taxpayer's net income for individuals, trusts, and estates and to 4.8% of the taxpayer's net income for corporations. For all taxable years following the taxable year in which the rate has been reduced pursuant to this Section, the tax rate set forth in subsection (b) of Section 201 of this Act shall be 3% of the taxpayer's net income for individuals, trusts, and estates and 4.8% of the taxpayer's net income for corporations.
    (b) The State spending limitation for fiscal years 2012 through 2015 shall be as follows: (i) for fiscal year 2012, $36,818,000,000; (ii) for fiscal year 2013, $37,554,000,000; (iii) for fiscal year 2014, $38,305,000,000; and (iv) for fiscal year 2015, $39,072,000,000.
    (c) Notwithstanding any other provision of law to the contrary, the Auditor General shall examine each Public Act authorizing State spending from State general funds and prepare a report no later than 30 days after receiving notification of the Public Act from the Secretary of State or 60 days after the effective date of the Public Act, whichever is earlier. The Auditor General shall file the report with the Secretary of State and copies with the Governor, the State Treasurer, the State Comptroller, the Senate, and the House of Representatives. The report shall indicate: (i) the amount of State spending set forth in the applicable Public Act; (ii) the total amount of State spending authorized by law for the applicable fiscal year as of the date of the report; and (iii) whether State spending exceeds the State spending limitation set forth in subsection (b). The Auditor General may examine multiple Public Acts in one consolidated report, provided that each Public Act is examined within the time period mandated by this subsection (c). The Auditor General shall issue reports in accordance with this Section through June 30, 2015 or the effective date of a reduction in the rate of tax imposed by subsections (a) and (b) of Section 201 of this Act pursuant to this Section, whichever is earlier.
    At the request of the Auditor General, each State agency shall, without delay, make available to the Auditor General or his or her designated representative any record or information requested and shall provide for examination or copying all records, accounts, papers, reports, vouchers, correspondence, books and other documentation in the custody of that agency, including information stored in electronic data processing systems, which is related to or within the scope of a report prepared under this Section. The Auditor General shall report to the Governor each instance in which a State agency fails to cooperate promptly and fully with his or her office as required by this Section.
    The Auditor General's report shall not be in the nature of a post-audit or examination and shall not lead to the issuance of an opinion as that term is defined in generally accepted government auditing standards.
    (d) If the Auditor General reports that State spending has exceeded the State spending limitation set forth in subsection (b) and if the Governor has not been presented with a bill or bills passed by the General Assembly to reduce State spending to a level that does not exceed the State spending limitation within 45 calendar days of receipt of the Auditor General's report, then the Governor may, for the purpose of reducing State spending to a level that does not exceed the State spending limitation set forth in subsection (b), designate amounts to be set aside as a reserve from the amounts appropriated from the State general funds for all boards, commissions, agencies, institutions, authorities, colleges, universities, and bodies politic and corporate of the State, but not other constitutional officers, the legislative or judicial branch, the office of the Executive Inspector General, or the Executive Ethics Commission. Such a designation must be made within 15 calendar days after the end of that 45-day period. If the Governor designates amounts to be set aside as a reserve, the Governor shall give notice of the designation to the Auditor General, the State Treasurer, the State Comptroller, the Senate, and the House of Representatives. The amounts placed in reserves shall not be transferred, obligated, encumbered, expended, or otherwise committed unless so authorized by law. Any amount placed in reserves is not State spending and shall not be considered when calculating the total amount of State spending. Any Public Act authorizing the use of amounts placed in reserve by the Governor is considered State spending, unless such Public Act authorizes the use of amounts placed in reserves in response to a fiscal emergency under subsection (g).
    (e) If the Auditor General reports under subsection (c) that State spending has exceeded the State spending limitation set forth in subsection (b), then the Auditor General shall issue a supplemental report no sooner than the 61st day and no later than the 65th day after issuing the report pursuant to subsection (c). The supplemental report shall: (i) summarize details of actions taken by the General Assembly and the Governor after the issuance of the initial report to reduce State spending, if any, (ii) indicate whether the level of State spending has changed since the initial report, and (iii) indicate whether State spending exceeds the State spending limitation. The Auditor General shall file the report with the Secretary of State and copies with the Governor, the State Treasurer, the State Comptroller, the Senate, and the House of Representatives. If the supplemental report of the Auditor General provides that State spending exceeds the State spending limitation, then the rate of tax imposed by subsections (a) and (b) of Section 201 is reduced as provided in this Section beginning on the first day of the first month to occur not less than 30 days after issuance of the supplemental report.
    (f) For any taxable year in which the rates of tax have been reduced under this Section, the tax imposed by subsections (a) and (b) of Section 201 shall be determined as follows:
        (1) In the case of an individual, trust, or estate,
    
the tax shall be imposed in an amount equal to the sum of (i) the rate applicable to the taxpayer under subsection (b) of Section 201 (without regard to the provisions of this Section) times the taxpayer's net income for any portion of the taxable year prior to the effective date of the reduction and (ii) 3% of the taxpayer's net income for any portion of the taxable year on or after the effective date of the reduction.
        (2) In the case of a corporation, the tax shall be
    
imposed in an amount equal to the sum of (i) the rate applicable to the taxpayer under subsection (b) of Section 201 (without regard to the provisions of this Section) times the taxpayer's net income for any portion of the taxable year prior to the effective date of the reduction and (ii) 4.8% of the taxpayer's net income for any portion of the taxable year on or after the effective date of the reduction.
        (3) For any taxpayer for whom the rate has been
    
reduced under this Section for a portion of a taxable year, the taxpayer shall determine the net income for each portion of the taxable year following the rules set forth in Section 202.5 of this Act, using the effective date of the rate reduction rather than the January 1 dates found in that Section, and the day before the effective date of the rate reduction rather than the December 31 dates found in that Section.
        (4) If the rate applicable to the taxpayer under
    
subsection (b) of Section 201 (without regard to the provisions of this Section) changes during a portion of the taxable year to which that rate is applied under paragraphs (1) or (2) of this subsection (f), the tax for that portion of the taxable year for purposes of paragraph (1) or (2) of this subsection (f) shall be determined as if that portion of the taxable year were a separate taxable year, following the rules set forth in Section 202.5 of this Act. If the taxpayer elects to follow the rules set forth in subsection (b) of Section 202.5, the taxpayer shall follow the rules set forth in subsection (b) of Section 202.5 for all purposes of this Section for that taxable year.
    (g) Notwithstanding the State spending limitation set forth in subsection (b) of this Section, the Governor may declare a fiscal emergency by filing a declaration with the Secretary of State and copies with the State Treasurer, the State Comptroller, the Senate, and the House of Representatives. The declaration must be limited to only one State fiscal year, set forth compelling reasons for declaring a fiscal emergency, and request a specific dollar amount. Unless, within 10 calendar days of receipt of the Governor's declaration, the State Comptroller or State Treasurer notifies the Senate and the House of Representatives that he or she does not concur in the Governor's declaration, State spending authorized by law to address the fiscal emergency in an amount no greater than the dollar amount specified in the declaration shall not be considered "State spending" for purposes of the State spending limitation.
    (h) As used in this Section:
    "State general funds" means the General Revenue Fund, the Common School Fund, the General Revenue Common School Special Account Fund, the Education Assistance Fund, and the Budget Stabilization Fund.
    "State spending" means (i) the total amount authorized for spending by appropriation or statutory transfer from the State general funds in the applicable fiscal year, and (ii) any amounts the Governor places in reserves in accordance with subsection (d) that are subsequently released from reserves following authorization by a Public Act. For the purpose of this definition, "appropriation" means authority to spend money from a State general fund for a specific amount, purpose, and time period, including any supplemental appropriation or continuing appropriation, but does not include reappropriations from a previous fiscal year. For the purpose of this definition, "statutory transfer" means authority to transfer funds from one State general fund to any other fund in the State treasury, but does not include transfers made from one State general fund to another State general fund.
    "State spending limitation" means the amount described in subsection (b) of this Section for the applicable fiscal year.
(Source: P.A. 96-1496, eff. 1-13-11; 97-813, eff. 7-13-12.)

35 ILCS 5/202

    (35 ILCS 5/202) (from Ch. 120, par. 2-202)
    Sec. 202. Net Income Defined. In general. For purposes of this Act, a taxpayer's net income for a taxable year shall be that portion of his base income for such year which is allocable to this State under the provisions of Article 3, less the standard exemption allowed by Section 204 and the deduction allowed by Section 207.
(Source: P.A. 92-846, eff. 8-23-02.)

35 ILCS 5/202.3

    (35 ILCS 5/202.3) (from Ch. 120, par. 2-202.3)
    Sec. 202.3. Net income attributable to the period prior to July 1, 1989 and net income attributable to the period after June 30, 1989. (a) In general. With respect to the taxable year of a taxpayer beginning prior to July 1, 1989 and ending after June 30, 1989, net income for the period after June 30, 1989 shall be that amount which bears the same ratio to the taxpayer's net income for the entire taxable year as the number of days in such year after June 30, 1989 bears to the total number of days in such year, and the net income for the period prior to July 1, 1989 shall be that amount which bears the same ratio to the taxpayer's net income for the entire taxable year as the number of days in such year prior to July 1, 1989 bears to the total number of days in such year.
    (b) Election to attribute income and deduction items specifically to the respective portions of a taxable year prior to July 1, 1989 and after June 30, 1989. In the case of a taxpayer with a taxable year beginning prior to July 1, 1989 and ending after June 30, 1989, the taxpayer may elect, in lieu of the procedure established in subsection (a) of this Section, to determine net income on a specific accounting basis for the 2 portions of his taxable year:
    (i) from the beginning of the taxable year through June 30, 1989, and
    (ii) from July 1, 1989 through the end of the taxable year.
    If the taxpayer elects specific accounting under this subsection, there shall be taken into account in computing base income for each of the 2 portions of the taxable year only those items earned, received, paid, incurred or accrued in each such period. The standard exemption provided by Section 204 shall be divided between the respective periods in amounts which bear the same ratio to the total exemption allowable under Section 204 (determined without regard to this Section) as the total number of days in each such period bears to the total number of days in the taxable year. The election provided by this subsection shall be made in such manner and at such time as the Department may by forms or regulations prescribe, but shall be made not later than the due date (including any extensions thereof) for the filing of the return for the taxable year, and shall be irrevocable.
(Source: P.A. 86-18.)

35 ILCS 5/202.4

    (35 ILCS 5/202.4)
    Sec. 202.4. (Repealed).
(Source: Repealed by P.A. 88-89.)

35 ILCS 5/202.5

    (35 ILCS 5/202.5)
    Sec. 202.5. Net income attributable to the period beginning prior to January 1 of any year and ending after December 31 of the preceding year.
    (a) In general. With respect to the taxable year of a taxpayer beginning prior to January 1 of any year and ending after December 31 of the preceding year, net income for the period after December 31 of the preceding year, is that amount that bears the same ratio to the taxpayer's net income for the entire taxable year as the number of days in that taxable year after December 31 bears to the total number of days in that taxable year, and the net income for the period prior to January 1 is that amount that bears the same ratio to the taxpayer's net income for the entire taxable year as the number of days in that taxable year prior to January 1 bears to the total number of days in that taxable year.
    (b) Election to attribute income and deduction items specifically to the respective portions of a taxable year prior to January 1 of any year and after December 31 of the preceding year. In the case of a taxpayer with a taxable year beginning prior to January 1 of any year and ending after December 31 of the preceding year, the taxpayer may elect, instead of the procedure established in subsection (a) of this Section, to determine net income on a specific accounting basis for the 2 portions of the taxable year:
        (1) from the beginning of the taxable year through
    
December 31; and
        (2) from January 1 through the end of the taxable
    
year.
    The election provided by this subsection must be made in form and manner that the Department requires by rule, and must be made no later than the due date (including any extensions thereof) for the filing of the return for the taxable year, and is irrevocable.
    (c) If the taxpayer elects specific accounting under subsection (b):
        (1) there shall be taken into account in computing
    
base income for each of the 2 portions of the taxable year only those items earned, received, paid, incurred or accrued in each such period;
        (2) for purposes of apportioning business income of
    
the taxpayer, the provisions in Article 3 shall be applied on the basis of the taxpayer's full taxable year, without regard to this Section;
        (3) the net loss carryforward deduction for the
    
taxable year under Section 207 may not exceed combined net income of both portions of the taxable year, and shall be used against the net income of the portion of the taxable year from the beginning of the taxable year through December 31 before any remaining amount is used against the net income of the latter portion of the taxable year.
(Source: P.A. 96-1496, eff. 1-13-11.)

35 ILCS 5/203

    (35 ILCS 5/203) (from Ch. 120, par. 2-203)
    Sec. 203. Base income defined.
    (a) Individuals.
        (1) In general. In the case of an individual, base
    
income means an amount equal to the taxpayer's adjusted gross income for the taxable year as modified by paragraph (2).
        (2) Modifications. The adjusted gross income
    
referred to in paragraph (1) shall be modified by adding thereto the sum of the following amounts:
            (A) An amount equal to all amounts paid or
        
accrued to the taxpayer as interest or dividends during the taxable year to the extent excluded from gross income in the computation of adjusted gross income, except stock dividends of qualified public utilities described in Section 305(e) of the Internal Revenue Code;
            (B) An amount equal to the amount of tax imposed
        
by this Act to the extent deducted from gross income in the computation of adjusted gross income for the taxable year;
            (C) An amount equal to the amount received during
        
the taxable year as a recovery or refund of real property taxes paid with respect to the taxpayer's principal residence under the Revenue Act of 1939 and for which a deduction was previously taken under subparagraph (L) of this paragraph (2) prior to July 1, 1991, the retrospective application date of Article 4 of Public Act 87-17. In the case of multi-unit or multi-use structures and farm dwellings, the taxes on the taxpayer's principal residence shall be that portion of the total taxes for the entire property which is attributable to such principal residence;
            (D) An amount equal to the amount of the capital
        
gain deduction allowable under the Internal Revenue Code, to the extent deducted from gross income in the computation of adjusted gross income;
            (D-5) An amount, to the extent not included in
        
adjusted gross income, equal to the amount of money withdrawn by the taxpayer in the taxable year from a medical care savings account and the interest earned on the account in the taxable year of a withdrawal pursuant to subsection (b) of Section 20 of the Medical Care Savings Account Act or subsection (b) of Section 20 of the Medical Care Savings Account Act of 2000;
            (D-10) For taxable years ending after December
        
31, 1997, an amount equal to any eligible remediation costs that the individual deducted in computing adjusted gross income and for which the individual claims a credit under subsection (l) of Section 201;
            (D-15) For taxable years 2001 and thereafter, an
        
amount equal to the bonus depreciation deduction taken on the taxpayer's federal income tax return for the taxable year under subsection (k) of Section 168 of the Internal Revenue Code;
            (D-16) If the taxpayer sells, transfers,
        
abandons, or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-15), then an amount equal to the aggregate amount of the deductions taken in all taxable years under subparagraph (Z) with respect to that property.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was allowed in any taxable year to make a subtraction modification under subparagraph (Z), then an amount equal to that subtraction modification.
            The taxpayer is required to make the addition
        
modification under this subparagraph only once with respect to any one piece of property;
            (D-17) An amount equal to the amount otherwise
        
allowed as a deduction in computing base income for interest paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that foreign person's business activity outside the United States is 80% or more of the foreign person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the interest was paid, accrued, or incurred.
            This paragraph shall not apply to the following:
                (i) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such interest; or
                (ii) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person, during the same taxable
                
year, paid, accrued, or incurred, the interest to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
interest expense between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects an arm's-length interest rate and terms; or
                (iii) the taxpayer can establish, based on
            
clear and convincing evidence, that the interest paid, accrued, or incurred relates to a contract or agreement entered into at arm's-length rates and terms and the principal purpose for the payment is not federal or Illinois tax avoidance; or
                (iv) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer establishes by clear and convincing evidence that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f).
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (D-18) An amount equal to the amount of
        
intangible expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the intangible expenses and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence does not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(a)(2)(D-17) of this Act. As used in this subparagraph, the term "intangible expenses and costs" includes (1) expenses, losses, and costs for, or related to, the direct or indirect acquisition, use, maintenance or management, ownership, sale, exchange, or any other disposition of intangible property; (2) losses incurred, directly or indirectly, from factoring transactions or discounting transactions; (3) royalty, patent, technical, and copyright fees; (4) licensing fees; and (5) other similar expenses and costs. For purposes of this subparagraph, "intangible property" includes patents, patent applications, trade names, trademarks, service marks, copyrights, mask works, trade secrets, and similar types of intangible assets.
            This paragraph shall not apply to the following:
                (i) any item of intangible expenses
            
or costs paid, accrued, or incurred, directly or indirectly, from a transaction with a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such item; or
                (ii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person during the same taxable
                
year paid, accrued, or incurred, the intangible expense or cost to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
intangible expense or cost between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects arm's-length terms; or
                (iii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, from a transaction with a person if the taxpayer establishes by clear and convincing evidence, that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f);
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (D-19) For taxable years ending on or after
        
December 31, 2008, an amount equal to the amount of insurance premium expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the premiums and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence does not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(a)(2)(D-17) or Section 203(a)(2)(D-18) of this Act.
            (D-20) For taxable years beginning on or after
        
January 1, 2002 and ending on or before December 31, 2006, in the case of a distribution from a qualified tuition program under Section 529 of the Internal Revenue Code, other than (i) a distribution from a College Savings Pool created under Section 16.5 of the State Treasurer Act or (ii) a distribution from the Illinois Prepaid Tuition Trust Fund, an amount equal to the amount excluded from gross income under Section 529(c)(3)(B). For taxable years beginning on or after January 1, 2007, in the case of a distribution from a qualified tuition program under Section 529 of the Internal Revenue Code, other than (i) a distribution from a College Savings Pool created under Section 16.5 of the State Treasurer Act, (ii) a distribution from the Illinois Prepaid Tuition Trust Fund, or (iii) a distribution from a qualified tuition program under Section 529 of the Internal Revenue Code that (I) adopts and determines that its offering materials comply with the College Savings Plans Network's disclosure principles and (II) has made reasonable efforts to inform in-state residents of the existence of in-state qualified tuition programs by informing Illinois residents directly and, where applicable, to inform financial intermediaries distributing the program to inform in-state residents of the existence of in-state qualified tuition programs at least annually, an amount equal to the amount excluded from gross income under Section 529(c)(3)(B).
            For the purposes of this subparagraph (D-20), a
        
qualified tuition program has made reasonable efforts if it makes disclosures (which may use the term "in-state program" or "in-state plan" and need not specifically refer to Illinois or its qualified programs by name) (i) directly to prospective participants in its offering materials or makes a public disclosure, such as a website posting; and (ii) where applicable, to intermediaries selling the out-of-state program in the same manner that the out-of-state program distributes its offering materials;
            (D-21) For taxable years beginning on or after
        
January 1, 2007, in the case of transfer of moneys from a qualified tuition program under Section 529 of the Internal Revenue Code that is administered by the State to an out-of-state program, an amount equal to the amount of moneys previously deducted from base income under subsection (a)(2)(Y) of this Section;
            (D-22) For taxable years beginning on or after
        
January 1, 2009, in the case of a nonqualified withdrawal or refund of moneys from a qualified tuition program under Section 529 of the Internal Revenue Code administered by the State that is not used for qualified expenses at an eligible education institution, an amount equal to the contribution component of the nonqualified withdrawal or refund that was previously deducted from base income under subsection (a)(2)(y) of this Section, provided that the withdrawal or refund did not result from the beneficiary's death or disability;
            (D-23) An amount equal to the credit allowable
        
to the taxpayer under Section 218(a) of this Act, determined without regard to Section 218(c) of this Act;
    and by deducting from the total so obtained the sum of
    
the following amounts:
            (E) For taxable years ending before December 31,
        
2001, any amount included in such total in respect of any compensation (including but not limited to any compensation paid or accrued to a serviceman while a prisoner of war or missing in action) paid to a resident by reason of being on active duty in the Armed Forces of the United States and in respect of any compensation paid or accrued to a resident who as a governmental employee was a prisoner of war or missing in action, and in respect of any compensation paid to a resident in 1971 or thereafter for annual training performed pursuant to Sections 502 and 503, Title 32, United States Code as a member of the Illinois National Guard or, beginning with taxable years ending on or after December 31, 2007, the National Guard of any other state. For taxable years ending on or after December 31, 2001, any amount included in such total in respect of any compensation (including but not limited to any compensation paid or accrued to a serviceman while a prisoner of war or missing in action) paid to a resident by reason of being a member of any component of the Armed Forces of the United States and in respect of any compensation paid or accrued to a resident who as a governmental employee was a prisoner of war or missing in action, and in respect of any compensation paid to a resident in 2001 or thereafter by reason of being a member of the Illinois National Guard or, beginning with taxable years ending on or after December 31, 2007, the National Guard of any other state. The provisions of this subparagraph (E) are exempt from the provisions of Section 250;
            (F) An amount equal to all amounts included in
        
such total pursuant to the provisions of Sections 402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and 408 of the Internal Revenue Code, or included in such total as distributions under the provisions of any retirement or disability plan for employees of any governmental agency or unit, or retirement payments to retired partners, which payments are excluded in computing net earnings from self employment by Section 1402 of the Internal Revenue Code and regulations adopted pursuant thereto;
            (G) The valuation limitation amount;
            (H) An amount equal to the amount of any tax
        
imposed by this Act which was refunded to the taxpayer and included in such total for the taxable year;
            (I) An amount equal to all amounts included in
        
such total pursuant to the provisions of Section 111 of the Internal Revenue Code as a recovery of items previously deducted from adjusted gross income in the computation of taxable income;
            (J) An amount equal to those dividends included
        
in such total which were paid by a corporation which conducts business operations in a River Edge Redevelopment Zone or zones created under the River Edge Redevelopment Zone Act, and conducts substantially all of its operations in a River Edge Redevelopment Zone or zones. This subparagraph (J) is exempt from the provisions of Section 250;
            (K) An amount equal to those dividends included
        
in such total that were paid by a corporation that conducts business operations in a federally designated Foreign Trade Zone or Sub-Zone and that is designated a High Impact Business located in Illinois; provided that dividends eligible for the deduction provided in subparagraph (J) of paragraph (2) of this subsection shall not be eligible for the deduction provided under this subparagraph (K);
            (L) For taxable years ending after December 31,
        
1983, an amount equal to all social security benefits and railroad retirement benefits included in such total pursuant to Sections 72(r) and 86 of the Internal Revenue Code;
            (M) With the exception of any amounts subtracted
        
under subparagraph (N), an amount equal to the sum of all amounts disallowed as deductions by (i) Sections 171(a) (2), and 265(2) of the Internal Revenue Code, and all amounts of expenses allocable to interest and disallowed as deductions by Section 265(1) of the Internal Revenue Code; and (ii) for taxable years ending on or after August 13, 1999, Sections 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the Internal Revenue Code, plus, for taxable years ending on or after December 31, 2011, Section 45G(e)(3) of the Internal Revenue Code and, for taxable years ending on or after December 31, 2008, any amount included in gross income under Section 87 of the Internal Revenue Code; the provisions of this subparagraph are exempt from the provisions of Section 250;
            (N) An amount equal to all amounts included in
        
such total which are exempt from taxation by this State either by reason of its statutes or Constitution or by reason of the Constitution, treaties or statutes of the United States; provided that, in the case of any statute of this State that exempts income derived from bonds or other obligations from the tax imposed under this Act, the amount exempted shall be the interest net of bond premium amortization;
            (O) An amount equal to any contribution made to a
        
job training project established pursuant to the Tax Increment Allocation Redevelopment Act;
            (P) An amount equal to the amount of the
        
deduction used to compute the federal income tax credit for restoration of substantial amounts held under claim of right for the taxable year pursuant to Section 1341 of the Internal Revenue Code or of any itemized deduction taken from adjusted gross income in the computation of taxable income for restoration of substantial amounts held under claim of right for the taxable year;
            (Q) An amount equal to any amounts included in
        
such total, received by the taxpayer as an acceleration in the payment of life, endowment or annuity benefits in advance of the time they would otherwise be payable as an indemnity for a terminal illness;
            (R) An amount equal to the amount of any federal
        
or State bonus paid to veterans of the Persian Gulf War;
            (S) An amount, to the extent included in adjusted
        
gross income, equal to the amount of a contribution made in the taxable year on behalf of the taxpayer to a medical care savings account established under the Medical Care Savings Account Act or the Medical Care Savings Account Act of 2000 to the extent the contribution is accepted by the account administrator as provided in that Act;
            (T) An amount, to the extent included in adjusted
        
gross income, equal to the amount of interest earned in the taxable year on a medical care savings account established under the Medical Care Savings Account Act or the Medical Care Savings Account Act of 2000 on behalf of the taxpayer, other than interest added pursuant to item (D-5) of this paragraph (2);
            (U) For one taxable year beginning on or after
        
January 1, 1994, an amount equal to the total amount of tax imposed and paid under subsections (a) and (b) of Section 201 of this Act on grant amounts received by the taxpayer under the Nursing Home Grant Assistance Act during the taxpayer's taxable years 1992 and 1993;
            (V) Beginning with tax years ending on or after
        
December 31, 1995 and ending with tax years ending on or before December 31, 2004, an amount equal to the amount paid by a taxpayer who is a self-employed taxpayer, a partner of a partnership, or a shareholder in a Subchapter S corporation for health insurance or long-term care insurance for that taxpayer or that taxpayer's spouse or dependents, to the extent that the amount paid for that health insurance or long-term care insurance may be deducted under Section 213 of the Internal Revenue Code, has not been deducted on the federal income tax return of the taxpayer, and does not exceed the taxable income attributable to that taxpayer's income, self-employment income, or Subchapter S corporation income; except that no deduction shall be allowed under this item (V) if the taxpayer is eligible to participate in any health insurance or long-term care insurance plan of an employer of the taxpayer or the taxpayer's spouse. The amount of the health insurance and long-term care insurance subtracted under this item (V) shall be determined by multiplying total health insurance and long-term care insurance premiums paid by the taxpayer times a number that represents the fractional percentage of eligible medical expenses under Section 213 of the Internal Revenue Code of 1986 not actually deducted on the taxpayer's federal income tax return;
            (W) For taxable years beginning on or after
        
January 1, 1998, all amounts included in the taxpayer's federal gross income in the taxable year from amounts converted from a regular IRA to a Roth IRA. This paragraph is exempt from the provisions of Section 250;
            (X) For taxable year 1999 and thereafter, an
        
amount equal to the amount of any (i) distributions, to the extent includible in gross income for federal income tax purposes, made to the taxpayer because of his or her status as a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime or as an heir of the victim and (ii) items of income, to the extent includible in gross income for federal income tax purposes, attributable to, derived from or in any way related to assets stolen from, hidden from, or otherwise lost to a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime immediately prior to, during, and immediately after World War II, including, but not limited to, interest on the proceeds receivable as insurance under policies issued to a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime by European insurance companies immediately prior to and during World War II; provided, however, this subtraction from federal adjusted gross income does not apply to assets acquired with such assets or with the proceeds from the sale of such assets; provided, further, this paragraph shall only apply to a taxpayer who was the first recipient of such assets after their recovery and who is a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime or as an heir of the victim. The amount of and the eligibility for any public assistance, benefit, or similar entitlement is not affected by the inclusion of items (i) and (ii) of this paragraph in gross income for federal income tax purposes. This paragraph is exempt from the provisions of Section 250;
            (Y) For taxable years beginning on or after
        
January 1, 2002 and ending on or before December 31, 2004, moneys contributed in the taxable year to a College Savings Pool account under Section 16.5 of the State Treasurer Act, except that amounts excluded from gross income under Section 529(c)(3)(C)(i) of the Internal Revenue Code shall not be considered moneys contributed under this subparagraph (Y). For taxable years beginning on or after January 1, 2005, a maximum of $10,000 contributed in the taxable year to (i) a College Savings Pool account under Section 16.5 of the State Treasurer Act or (ii) the Illinois Prepaid Tuition Trust Fund, except that amounts excluded from gross income under Section 529(c)(3)(C)(i) of the Internal Revenue Code shall not be considered moneys contributed under this subparagraph (Y). For purposes of this subparagraph, contributions made by an employer on behalf of an employee, or matching contributions made by an employee, shall be treated as made by the employee. This subparagraph (Y) is exempt from the provisions of Section 250;
            (Z) For taxable years 2001 and thereafter, for
        
the taxable year in which the bonus depreciation deduction is taken on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code and for each applicable taxable year thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation
            
deduction taken for the taxable year on the taxpayer's federal income tax return on property for which the bonus depreciation deduction was taken in any year under subsection (k) of Section 168 of the Internal Revenue Code, but not including the bonus depreciation deduction;
                (2) for taxable years ending on or before
            
December 31, 2005, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                (3) for taxable years ending after December
            
31, 2005:
                    (i) for property on which a bonus
                
depreciation deduction of 30% of the adjusted basis was taken, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                    (ii) for property on which a bonus
                
depreciation deduction of 50% of the adjusted basis was taken, "x" equals "y" multiplied by 1.0.
            The aggregate amount deducted under this
        
subparagraph in all taxable years for any one piece of property may not exceed the amount of the bonus depreciation deduction taken on that property on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code. This subparagraph (Z) is exempt from the provisions of Section 250;
            (AA) If the taxpayer sells, transfers, abandons,
        
or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-15), then an amount equal to that addition modification.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-15), then an amount equal to that addition modification.
            The taxpayer is allowed to take the deduction
        
under this subparagraph only once with respect to any one piece of property.
            This subparagraph (AA) is exempt from the
        
provisions of Section 250;
            (BB) Any amount included in adjusted gross
        
income, other than salary, received by a driver in a ridesharing arrangement using a motor vehicle;
            (CC) The amount of (i) any interest income (net
        
of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-17), 203(b)(2)(E-12), 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed the amount of that addition modification, and (ii) any income from intangible property (net of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 203(d)(2)(D-8), but not to exceed the amount of that addition modification. This subparagraph (CC) is exempt from the provisions of Section 250;
            (DD) An amount equal to the interest income taken
        
into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(a)(2)(D-17) for interest paid, accrued, or incurred, directly or indirectly, to the same person. This subparagraph (DD) is exempt from the provisions of Section 250;
            (EE) An amount equal to the income from
        
intangible property taken into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(a)(2)(D-18) for intangible expenses and costs paid, accrued, or incurred, directly or indirectly, to the same foreign person. This subparagraph (EE) is exempt from the provisions of Section 250;
            (FF) An amount equal to any amount awarded to the
        
taxpayer during the taxable year by the Court of Claims under subsection (c) of Section 8 of the Court of Claims Act for time unjustly served in a State prison. This subparagraph (FF) is exempt from the provisions of Section 250; and
            (GG) For taxable years ending on or after
        
December 31, 2011, in the case of a taxpayer who was required to add back any insurance premiums under Section 203(a)(2)(D-19), such taxpayer may elect to subtract that part of a reimbursement received from the insurance company equal to the amount of the expense or loss (including expenses incurred by the insurance company) that would have been taken into account as a deduction for federal income tax purposes if the expense or loss had been uninsured. If a taxpayer makes the election provided for by this subparagraph (GG), the insurer to which the premiums were paid must add back to income the amount subtracted by the taxpayer pursuant to this subparagraph (GG). This subparagraph (GG) is exempt from the provisions of Section 250.

 
    (b) Corporations.
        (1) In general. In the case of a corporation, base
    
income means an amount equal to the taxpayer's taxable income for the taxable year as modified by paragraph (2).
        (2) Modifications. The taxable income referred to in
    
paragraph (1) shall be modified by adding thereto the sum of the following amounts:
            (A) An amount equal to all amounts paid or
        
accrued to the taxpayer as interest and all distributions received from regulated investment companies during the taxable year to the extent excluded from gross income in the computation of taxable income;
            (B) An amount equal to the amount of tax imposed
        
by this Act to the extent deducted from gross income in the computation of taxable income for the taxable year;
            (C) In the case of a regulated investment
        
company, an amount equal to the excess of (i) the net long-term capital gain for the taxable year, over (ii) the amount of the capital gain dividends designated as such in accordance with Section 852(b)(3)(C) of the Internal Revenue Code and any amount designated under Section 852(b)(3)(D) of the Internal Revenue Code, attributable to the taxable year (this amendatory Act of 1995 (Public Act 89-89) is declarative of existing law and is not a new enactment);
            (D) The amount of any net operating loss
        
deduction taken in arriving at taxable income, other than a net operating loss carried forward from a taxable year ending prior to December 31, 1986;
            (E) For taxable years in which a net operating
        
loss carryback or carryforward from a taxable year ending prior to December 31, 1986 is an element of taxable income under paragraph (1) of subsection (e) or subparagraph (E) of paragraph (2) of subsection (e), the amount by which addition modifications other than those provided by this subparagraph (E) exceeded subtraction modifications in such earlier taxable year, with the following limitations applied in the order that they are listed:
                (i) the addition modification relating to the
            
net operating loss carried back or forward to the taxable year from any taxable year ending prior to December 31, 1986 shall be reduced by the amount of addition modification under this subparagraph (E) which related to that net operating loss and which was taken into account in calculating the base income of an earlier taxable year, and
                (ii) the addition modification relating to
            
the net operating loss carried back or forward to the taxable year from any taxable year ending prior to December 31, 1986 shall not exceed the amount of such carryback or carryforward;
            For taxable years in which there is a net
        
operating loss carryback or carryforward from more than one other taxable year ending prior to December 31, 1986, the addition modification provided in this subparagraph (E) shall be the sum of the amounts computed independently under the preceding provisions of this subparagraph (E) for each such taxable year;
            (E-5) For taxable years ending after December 31,
        
1997, an amount equal to any eligible remediation costs that the corporation deducted in computing adjusted gross income and for which the corporation claims a credit under subsection (l) of Section 201;
            (E-10) For taxable years 2001 and thereafter, an
        
amount equal to the bonus depreciation deduction taken on the taxpayer's federal income tax return for the taxable year under subsection (k) of Section 168 of the Internal Revenue Code;
            (E-11) If the taxpayer sells, transfers,
        
abandons, or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (E-10), then an amount equal to the aggregate amount of the deductions taken in all taxable years under subparagraph (T) with respect to that property.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was allowed in any taxable year to make a subtraction modification under subparagraph (T), then an amount equal to that subtraction modification.
            The taxpayer is required to make the addition
        
modification under this subparagraph only once with respect to any one piece of property;
            (E-12) An amount equal to the amount otherwise
        
allowed as a deduction in computing base income for interest paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact the foreign person's business activity outside the United States is 80% or more of the foreign person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the interest was paid, accrued, or incurred.
            This paragraph shall not apply to the following:
                (i) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such interest; or
                (ii) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person, during the same taxable
                
year, paid, accrued, or incurred, the interest to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
interest expense between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects an arm's-length interest rate and terms; or
                (iii) the taxpayer can establish, based on
            
clear and convincing evidence, that the interest paid, accrued, or incurred relates to a contract or agreement entered into at arm's-length rates and terms and the principal purpose for the payment is not federal or Illinois tax avoidance; or
                (iv) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer establishes by clear and convincing evidence that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f).
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (E-13) An amount equal to the amount of
        
intangible expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the intangible expenses and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence shall not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(b)(2)(E-12) of this Act. As used in this subparagraph, the term "intangible expenses and costs" includes (1) expenses, losses, and costs for, or related to, the direct or indirect acquisition, use, maintenance or management, ownership, sale, exchange, or any other disposition of intangible property; (2) losses incurred, directly or indirectly, from factoring transactions or discounting transactions; (3) royalty, patent, technical, and copyright fees; (4) licensing fees; and (5) other similar expenses and costs. For purposes of this subparagraph, "intangible property" includes patents, patent applications, trade names, trademarks, service marks, copyrights, mask works, trade secrets, and similar types of intangible assets.
            This paragraph shall not apply to the following:
                (i) any item of intangible expenses
            
or costs paid, accrued, or incurred, directly or indirectly, from a transaction with a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such item; or
                (ii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person during the same taxable
                
year paid, accrued, or incurred, the intangible expense or cost to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
intangible expense or cost between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects arm's-length terms; or
                (iii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, from a transaction with a person if the taxpayer establishes by clear and convincing evidence, that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f);
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (E-14) For taxable years ending on or after
        
December 31, 2008, an amount equal to the amount of insurance premium expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the premiums and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence does not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(b)(2)(E-12) or Section 203(b)(2)(E-13) of this Act;
            (E-15) For taxable years beginning after December
        
31, 2008, any deduction for dividends paid by a captive real estate investment trust that is allowed to a real estate investment trust under Section 857(b)(2)(B) of the Internal Revenue Code for dividends paid;
            (E-16) An amount equal to the credit allowable
        
to the taxpayer under Section 218(a) of this Act, determined without regard to Section 218(c) of this Act;
    and by deducting from the total so obtained the sum of
    
the following amounts:
            (F) An amount equal to the amount of any tax
        
imposed by this Act which was refunded to the taxpayer and included in such total for the taxable year;
            (G) An amount equal to any amount included in
        
such total under Section 78 of the Internal Revenue Code;
            (H) In the case of a regulated investment
        
company, an amount equal to the amount of exempt interest dividends as defined in subsection (b) (5) of Section 852 of the Internal Revenue Code, paid to shareholders for the taxable year;
            (I) With the exception of any amounts subtracted
        
under subparagraph (J), an amount equal to the sum of all amounts disallowed as deductions by (i) Sections 171(a) (2), and 265(a)(2) and amounts disallowed as interest expense by Section 291(a)(3) of the Internal Revenue Code, and all amounts of expenses allocable to interest and disallowed as deductions by Section 265(a)(1) of the Internal Revenue Code; and (ii) for taxable years ending on or after August 13, 1999, Sections 171(a)(2), 265, 280C, 291(a)(3), and 832(b)(5)(B)(i) of the Internal Revenue Code, plus, for tax years ending on or after December 31, 2011, amounts disallowed as deductions by Section 45G(e)(3) of the Internal Revenue Code and, for taxable years ending on or after December 31, 2008, any amount included in gross income under Section 87 of the Internal Revenue Code and the policyholders' share of tax-exempt interest of a life insurance company under Section 807(a)(2)(B) of the Internal Revenue Code (in the case of a life insurance company with gross income from a decrease in reserves for the tax year) or Section 807(b)(1)(B) of the Internal Revenue Code (in the case of a life insurance company allowed a deduction for an increase in reserves for the tax year); the provisions of this subparagraph are exempt from the provisions of Section 250;
            (J) An amount equal to all amounts included in
        
such total which are exempt from taxation by this State either by reason of its statutes or Constitution or by reason of the Constitution, treaties or statutes of the United States; provided that, in the case of any statute of this State that exempts income derived from bonds or other obligations from the tax imposed under this Act, the amount exempted shall be the interest net of bond premium amortization;
            (K) An amount equal to those dividends included
        
in such total which were paid by a corporation which conducts business operations in a River Edge Redevelopment Zone or zones created under the River Edge Redevelopment Zone Act and conducts substantially all of its operations in a River Edge Redevelopment Zone or zones. This subparagraph (K) is exempt from the provisions of Section 250;
            (L) An amount equal to those dividends included
        
in such total that were paid by a corporation that conducts business operations in a federally designated Foreign Trade Zone or Sub-Zone and that is designated a High Impact Business located in Illinois; provided that dividends eligible for the deduction provided in subparagraph (K) of paragraph 2 of this subsection shall not be eligible for the deduction provided under this subparagraph (L);
            (M) For any taxpayer that is a financial
        
organization within the meaning of Section 304(c) of this Act, an amount included in such total as interest income from a loan or loans made by such taxpayer to a borrower, to the extent that such a loan is secured by property which is eligible for the River Edge Redevelopment Zone Investment Credit. To determine the portion of a loan or loans that is secured by property eligible for a Section 201(f) investment credit to the borrower, the entire principal amount of the loan or loans between the taxpayer and the borrower should be divided into the basis of the Section 201(f) investment credit property which secures the loan or loans, using for this purpose the original basis of such property on the date that it was placed in service in the River Edge Redevelopment Zone. The subtraction modification available to taxpayer in any year under this subsection shall be that portion of the total interest paid by the borrower with respect to such loan attributable to the eligible property as calculated under the previous sentence. This subparagraph (M) is exempt from the provisions of Section 250;
            (M-1) For any taxpayer that is a financial
        
organization within the meaning of Section 304(c) of this Act, an amount included in such total as interest income from a loan or loans made by such taxpayer to a borrower, to the extent that such a loan is secured by property which is eligible for the High Impact Business Investment Credit. To determine the portion of a loan or loans that is secured by property eligible for a Section 201(h) investment credit to the borrower, the entire principal amount of the loan or loans between the taxpayer and the borrower should be divided into the basis of the Section 201(h) investment credit property which secures the loan or loans, using for this purpose the original basis of such property on the date that it was placed in service in a federally designated Foreign Trade Zone or Sub-Zone located in Illinois. No taxpayer that is eligible for the deduction provided in subparagraph (M) of paragraph (2) of this subsection shall be eligible for the deduction provided under this subparagraph (M-1). The subtraction modification available to taxpayers in any year under this subsection shall be that portion of the total interest paid by the borrower with respect to such loan attributable to the eligible property as calculated under the previous sentence;
            (N) Two times any contribution made during the
        
taxable year to a designated zone organization to the extent that the contribution (i) qualifies as a charitable contribution under subsection (c) of Section 170 of the Internal Revenue Code and (ii) must, by its terms, be used for a project approved by the Department of Commerce and Economic Opportunity under Section 11 of the Illinois Enterprise Zone Act or under Section 10-10 of the River Edge Redevelopment Zone Act. This subparagraph (N) is exempt from the provisions of Section 250;
            (O) An amount equal to: (i) 85% for taxable years
        
ending on or before December 31, 1992, or, a percentage equal to the percentage allowable under Section 243(a)(1) of the Internal Revenue Code of 1986 for taxable years ending after December 31, 1992, of the amount by which dividends included in taxable income and received from a corporation that is not created or organized under the laws of the United States or any state or political subdivision thereof, including, for taxable years ending on or after December 31, 1988, dividends received or deemed received or paid or deemed paid under Sections 951 through 965 of the Internal Revenue Code, exceed the amount of the modification provided under subparagraph (G) of paragraph (2) of this subsection (b) which is related to such dividends, and including, for taxable years ending on or after December 31, 2008, dividends received from a captive real estate investment trust; plus (ii) 100% of the amount by which dividends, included in taxable income and received, including, for taxable years ending on or after December 31, 1988, dividends received or deemed received or paid or deemed paid under Sections 951 through 964 of the Internal Revenue Code and including, for taxable years ending on or after December 31, 2008, dividends received from a captive real estate investment trust, from any such corporation specified in clause (i) that would but for the provisions of Section 1504 (b) (3) of the Internal Revenue Code be treated as a member of the affiliated group which includes the dividend recipient, exceed the amount of the modification provided under subparagraph (G) of paragraph (2) of this subsection (b) which is related to such dividends. This subparagraph (O) is exempt from the provisions of Section 250 of this Act;
            (P) An amount equal to any contribution made to a
        
job training project established pursuant to the Tax Increment Allocation Redevelopment Act;
            (Q) An amount equal to the amount of the
        
deduction used to compute the federal income tax credit for restoration of substantial amounts held under claim of right for the taxable year pursuant to Section 1341 of the Internal Revenue Code;
            (R) On and after July 20, 1999, in the case of an
        
attorney-in-fact with respect to whom an interinsurer or a reciprocal insurer has made the election under Section 835 of the Internal Revenue Code, 26 U.S.C. 835, an amount equal to the excess, if any, of the amounts paid or incurred by that interinsurer or reciprocal insurer in the taxable year to the attorney-in-fact over the deduction allowed to that interinsurer or reciprocal insurer with respect to the attorney-in-fact under Section 835(b) of the Internal Revenue Code for the taxable year; the provisions of this subparagraph are exempt from the provisions of Section 250;
            (S) For taxable years ending on or after December
        
31, 1997, in the case of a Subchapter S corporation, an amount equal to all amounts of income allocable to a shareholder subject to the Personal Property Tax Replacement Income Tax imposed by subsections (c) and (d) of Section 201 of this Act, including amounts allocable to organizations exempt from federal income tax by reason of Section 501(a) of the Internal Revenue Code. This subparagraph (S) is exempt from the provisions of Section 250;
            (T) For taxable years 2001 and thereafter, for
        
the taxable year in which the bonus depreciation deduction is taken on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code and for each applicable taxable year thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation
            
deduction taken for the taxable year on the taxpayer's federal income tax return on property for which the bonus depreciation deduction was taken in any year under subsection (k) of Section 168 of the Internal Revenue Code, but not including the bonus depreciation deduction;
                (2) for taxable years ending on or before
            
December 31, 2005, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                (3) for taxable years ending after December
            
31, 2005:
                    (i) for property on which a bonus
                
depreciation deduction of 30% of the adjusted basis was taken, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                    (ii) for property on which a bonus
                
depreciation deduction of 50% of the adjusted basis was taken, "x" equals "y" multiplied by 1.0.
            The aggregate amount deducted under this
        
subparagraph in all taxable years for any one piece of property may not exceed the amount of the bonus depreciation deduction taken on that property on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code. This subparagraph (T) is exempt from the provisions of Section 250;
            (U) If the taxpayer sells, transfers, abandons,
        
or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (E-10), then an amount equal to that addition modification.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (E-10), then an amount equal to that addition modification.
            The taxpayer is allowed to take the deduction
        
under this subparagraph only once with respect to any one piece of property.
            This subparagraph (U) is exempt from the
        
provisions of Section 250;
            (V) The amount of: (i) any interest income (net
        
of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-17), 203(b)(2)(E-12), 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed the amount of such addition modification, (ii) any income from intangible property (net of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 203(d)(2)(D-8), but not to exceed the amount of such addition modification, and (iii) any insurance premium income (net of deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-19), Section 203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section 203(d)(2)(D-9), but not to exceed the amount of that addition modification. This subparagraph (V) is exempt from the provisions of Section 250;
            (W) An amount equal to the interest income taken
        
into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(b)(2)(E-12) for interest paid, accrued, or incurred, directly or indirectly, to the same person. This subparagraph (W) is exempt from the provisions of Section 250;
            (X) An amount equal to the income from intangible
        
property taken into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(b)(2)(E-13) for intangible expenses and costs paid, accrued, or incurred, directly or indirectly, to the same foreign person. This subparagraph (X) is exempt from the provisions of Section 250;
            (Y) For taxable years ending on or after December
        
31, 2011, in the case of a taxpayer who was required to add back any insurance premiums under Section 203(b)(2)(E-14), such taxpayer may elect to subtract that part of a reimbursement received from the insurance company equal to the amount of the expense or loss (including expenses incurred by the insurance company) that would have been taken into account as a deduction for federal income tax purposes if the expense or loss had been uninsured. If a taxpayer makes the election provided for by this subparagraph (Y), the insurer to which the premiums were paid must add back to income the amount subtracted by the taxpayer pursuant to this subparagraph (Y). This subparagraph (Y) is exempt from the provisions of Section 250; and
            (Z) The difference between the nondeductible
        
controlled foreign corporation dividends under Section 965(e)(3) of the Internal Revenue Code over the taxable income of the taxpayer, computed without regard to Section 965(e)(2)(A) of the Internal Revenue Code, and without regard to any net operating loss deduction. This subparagraph (Z) is exempt from the provisions of Section 250.
        (3) Special rule. For purposes of paragraph (2) (A),
    
"gross income" in the case of a life insurance company, for tax years ending on and after December 31, 1994, and prior to December 31, 2011, shall mean the gross investment income for the taxable year and, for tax years ending on or after December 31, 2011, shall mean all amounts included in life insurance gross income under Section 803(a)(3) of the Internal Revenue Code.

 
    (c) Trusts and estates.
        (1) In general. In the case of a trust or estate,
    
base income means an amount equal to the taxpayer's taxable income for the taxable year as modified by paragraph (2).
        (2) Modifications. Subject to the provisions of
    
paragraph (3), the taxable income referred to in paragraph (1) shall be modified by adding thereto the sum of the following amounts:
            (A) An amount equal to all amounts paid or
        
accrued to the taxpayer as interest or dividends during the taxable year to the extent excluded from gross income in the computation of taxable income;
            (B) In the case of (i) an estate, $600; (ii) a
        
trust which, under its governing instrument, is required to distribute all of its income currently, $300; and (iii) any other trust, $100, but in each such case, only to the extent such amount was deducted in the computation of taxable income;
            (C) An amount equal to the amount of tax imposed
        
by this Act to the extent deducted from gross income in the computation of taxable income for the taxable year;
            (D) The amount of any net operating loss
        
deduction taken in arriving at taxable income, other than a net operating loss carried forward from a taxable year ending prior to December 31, 1986;
            (E) For taxable years in which a net operating
        
loss carryback or carryforward from a taxable year ending prior to December 31, 1986 is an element of taxable income under paragraph (1) of subsection (e) or subparagraph (E) of paragraph (2) of subsection (e), the amount by which addition modifications other than those provided by this subparagraph (E) exceeded subtraction modifications in such taxable year, with the following limitations applied in the order that they are listed:
                (i) the addition modification relating to the
            
net operating loss carried back or forward to the taxable year from any taxable year ending prior to December 31, 1986 shall be reduced by the amount of addition modification under this subparagraph (E) which related to that net operating loss and which was taken into account in calculating the base income of an earlier taxable year, and
                (ii) the addition modification relating to
            
the net operating loss carried back or forward to the taxable year from any taxable year ending prior to December 31, 1986 shall not exceed the amount of such carryback or carryforward;
            For taxable years in which there is a net
        
operating loss carryback or carryforward from more than one other taxable year ending prior to December 31, 1986, the addition modification provided in this subparagraph (E) shall be the sum of the amounts computed independently under the preceding provisions of this subparagraph (E) for each such taxable year;
            (F) For taxable years ending on or after January
        
1, 1989, an amount equal to the tax deducted pursuant to Section 164 of the Internal Revenue Code if the trust or estate is claiming the same tax for purposes of the Illinois foreign tax credit under Section 601 of this Act;
            (G) An amount equal to the amount of the capital
        
gain deduction allowable under the Internal Revenue Code, to the extent deducted from gross income in the computation of taxable income;
            (G-5) For taxable years ending after December 31,
        
1997, an amount equal to any eligible remediation costs that the trust or estate deducted in computing adjusted gross income and for which the trust or estate claims a credit under subsection (l) of Section 201;
            (G-10) For taxable years 2001 and thereafter, an
        
amount equal to the bonus depreciation deduction taken on the taxpayer's federal income tax return for the taxable year under subsection (k) of Section 168 of the Internal Revenue Code; and
            (G-11) If the taxpayer sells, transfers,
        
abandons, or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (G-10), then an amount equal to the aggregate amount of the deductions taken in all taxable years under subparagraph (R) with respect to that property.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was allowed in any taxable year to make a subtraction modification under subparagraph (R), then an amount equal to that subtraction modification.
            The taxpayer is required to make the addition
        
modification under this subparagraph only once with respect to any one piece of property;
            (G-12) An amount equal to the amount otherwise
        
allowed as a deduction in computing base income for interest paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of the foreign person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the interest was paid, accrued, or incurred.
            This paragraph shall not apply to the following:
                (i) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such interest; or
                (ii) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person, during the same taxable
                
year, paid, accrued, or incurred, the interest to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
interest expense between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects an arm's-length interest rate and terms; or
                (iii) the taxpayer can establish, based on
            
clear and convincing evidence, that the interest paid, accrued, or incurred relates to a contract or agreement entered into at arm's-length rates and terms and the principal purpose for the payment is not federal or Illinois tax avoidance; or
                (iv) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer establishes by clear and convincing evidence that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f).
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (G-13) An amount equal to the amount of
        
intangible expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the intangible expenses and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence shall not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(c)(2)(G-12) of this Act. As used in this subparagraph, the term "intangible expenses and costs" includes: (1) expenses, losses, and costs for or related to the direct or indirect acquisition, use, maintenance or management, ownership, sale, exchange, or any other disposition of intangible property; (2) losses incurred, directly or indirectly, from factoring transactions or discounting transactions; (3) royalty, patent, technical, and copyright fees; (4) licensing fees; and (5) other similar expenses and costs. For purposes of this subparagraph, "intangible property" includes patents, patent applications, trade names, trademarks, service marks, copyrights, mask works, trade secrets, and similar types of intangible assets.
            This paragraph shall not apply to the following:
                (i) any item of intangible expenses
            
or costs paid, accrued, or incurred, directly or indirectly, from a transaction with a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such item; or
                (ii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person during the same taxable
                
year paid, accrued, or incurred, the intangible expense or cost to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
intangible expense or cost between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects arm's-length terms; or
                (iii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, from a transaction with a person if the taxpayer establishes by clear and convincing evidence, that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f);
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (G-14) For taxable years ending on or after
        
December 31, 2008, an amount equal to the amount of insurance premium expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the premiums and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence does not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(c)(2)(G-12) or Section 203(c)(2)(G-13) of this Act;
            (G-15) An amount equal to the credit allowable
        
to the taxpayer under Section 218(a) of this Act, determined without regard to Section 218(c) of this Act;
    and by deducting from the total so obtained the sum of
    
the following amounts:
            (H) An amount equal to all amounts included in
        
such total pursuant to the provisions of Sections 402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and 408 of the Internal Revenue Code or included in such total as distributions under the provisions of any retirement or disability plan for employees of any governmental agency or unit, or retirement payments to retired partners, which payments are excluded in computing net earnings from self employment by Section 1402 of the Internal Revenue Code and regulations adopted pursuant thereto;
            (I) The valuation limitation amount;
            (J) An amount equal to the amount of any tax
        
imposed by this Act which was refunded to the taxpayer and included in such total for the taxable year;
            (K) An amount equal to all amounts included in
        
taxable income as modified by subparagraphs (A), (B), (C), (D), (E), (F) and (G) which are exempt from taxation by this State either by reason of its statutes or Constitution or by reason of the Constitution, treaties or statutes of the United States; provided that, in the case of any statute of this State that exempts income derived from bonds or other obligations from the tax imposed under this Act, the amount exempted shall be the interest net of bond premium amortization;
            (L) With the exception of any amounts subtracted
        
under subparagraph (K), an amount equal to the sum of all amounts disallowed as deductions by (i) Sections 171(a) (2) and 265(a)(2) of the Internal Revenue Code, and all amounts of expenses allocable to interest and disallowed as deductions by Section 265(1) of the Internal Revenue Code; and (ii) for taxable years ending on or after August 13, 1999, Sections 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the Internal Revenue Code, plus, (iii) for taxable years ending on or after December 31, 2011, Section 45G(e)(3) of the Internal Revenue Code and, for taxable years ending on or after December 31, 2008, any amount included in gross income under Section 87 of the Internal Revenue Code; the provisions of this subparagraph are exempt from the provisions of Section 250;
            (M) An amount equal to those dividends included
        
in such total which were paid by a corporation which conducts business operations in a River Edge Redevelopment Zone or zones created under the River Edge Redevelopment Zone Act and conducts substantially all of its operations in a River Edge Redevelopment Zone or zones. This subparagraph (M) is exempt from the provisions of Section 250;
            (N) An amount equal to any contribution made to a
        
job training project established pursuant to the Tax Increment Allocation Redevelopment Act;
            (O) An amount equal to those dividends included
        
in such total that were paid by a corporation that conducts business operations in a federally designated Foreign Trade Zone or Sub-Zone and that is designated a High Impact Business located in Illinois; provided that dividends eligible for the deduction provided in subparagraph (M) of paragraph (2) of this subsection shall not be eligible for the deduction provided under this subparagraph (O);
            (P) An amount equal to the amount of the
        
deduction used to compute the federal income tax credit for restoration of substantial amounts held under claim of right for the taxable year pursuant to Section 1341 of the Internal Revenue Code;
            (Q) For taxable year 1999 and thereafter, an
        
amount equal to the amount of any (i) distributions, to the extent includible in gross income for federal income tax purposes, made to the taxpayer because of his or her status as a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime or as an heir of the victim and (ii) items of income, to the extent includible in gross income for federal income tax purposes, attributable to, derived from or in any way related to assets stolen from, hidden from, or otherwise lost to a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime immediately prior to, during, and immediately after World War II, including, but not limited to, interest on the proceeds receivable as insurance under policies issued to a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime by European insurance companies immediately prior to and during World War II; provided, however, this subtraction from federal adjusted gross income does not apply to assets acquired with such assets or with the proceeds from the sale of such assets; provided, further, this paragraph shall only apply to a taxpayer who was the first recipient of such assets after their recovery and who is a victim of persecution for racial or religious reasons by Nazi Germany or any other Axis regime or as an heir of the victim. The amount of and the eligibility for any public assistance, benefit, or similar entitlement is not affected by the inclusion of items (i) and (ii) of this paragraph in gross income for federal income tax purposes. This paragraph is exempt from the provisions of Section 250;
            (R) For taxable years 2001 and thereafter, for
        
the taxable year in which the bonus depreciation deduction is taken on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code and for each applicable taxable year thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation
            
deduction taken for the taxable year on the taxpayer's federal income tax return on property for which the bonus depreciation deduction was taken in any year under subsection (k) of Section 168 of the Internal Revenue Code, but not including the bonus depreciation deduction;
                (2) for taxable years ending on or before
            
December 31, 2005, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                (3) for taxable years ending after December
            
31, 2005:
                    (i) for property on which a bonus
                
depreciation deduction of 30% of the adjusted basis was taken, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                    (ii) for property on which a bonus
                
depreciation deduction of 50% of the adjusted basis was taken, "x" equals "y" multiplied by 1.0.
            The aggregate amount deducted under this
        
subparagraph in all taxable years for any one piece of property may not exceed the amount of the bonus depreciation deduction taken on that property on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code. This subparagraph (R) is exempt from the provisions of Section 250;
            (S) If the taxpayer sells, transfers, abandons,
        
or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (G-10), then an amount equal to that addition modification.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (G-10), then an amount equal to that addition modification.
            The taxpayer is allowed to take the deduction
        
under this subparagraph only once with respect to any one piece of property.
            This subparagraph (S) is exempt from the
        
provisions of Section 250;
            (T) The amount of (i) any interest income (net of
        
the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-17), 203(b)(2)(E-12), 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed the amount of such addition modification and (ii) any income from intangible property (net of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 203(d)(2)(D-8), but not to exceed the amount of such addition modification. This subparagraph (T) is exempt from the provisions of Section 250;
            (U) An amount equal to the interest income taken
        
into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(c)(2)(G-12) for interest paid, accrued, or incurred, directly or indirectly, to the same person. This subparagraph (U) is exempt from the provisions of Section 250;
            (V) An amount equal to the income from intangible
        
property taken into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(c)(2)(G-13) for intangible expenses and costs paid, accrued, or incurred, directly or indirectly, to the same foreign person. This subparagraph (V) is exempt from the provisions of Section 250;
            (W) in the case of an estate, an amount equal to
        
all amounts included in such total pursuant to the provisions of Section 111 of the Internal Revenue Code as a recovery of items previously deducted by the decedent from adjusted gross income in the computation of taxable income. This subparagraph (W) is exempt from Section 250;
            (X) an amount equal to the refund included in
        
such total of any tax deducted for federal income tax purposes, to the extent that deduction was added back under subparagraph (F). This subparagraph (X) is exempt from the provisions of Section 250; and
            (Y) For taxable years ending on or after December
        
31, 2011, in the case of a taxpayer who was required to add back any insurance premiums under Section 203(c)(2)(G-14), such taxpayer may elect to subtract that part of a reimbursement received from the insurance company equal to the amount of the expense or loss (including expenses incurred by the insurance company) that would have been taken into account as a deduction for federal income tax purposes if the expense or loss had been uninsured. If a taxpayer makes the election provided for by this subparagraph (Y), the insurer to which the premiums were paid must add back to income the amount subtracted by the taxpayer pursuant to this subparagraph (Y). This subparagraph (Y) is exempt from the provisions of Section 250.
        (3) Limitation. The amount of any modification
    
otherwise required under this subsection shall, under regulations prescribed by the Department, be adjusted by any amounts included therein which were properly paid, credited, or required to be distributed, or permanently set aside for charitable purposes pursuant to Internal Revenue Code Section 642(c) during the taxable year.

 
    (d) Partnerships.
        (1) In general. In the case of a partnership, base
    
income means an amount equal to the taxpayer's taxable income for the taxable year as modified by paragraph (2).
        (2) Modifications. The taxable income referred to in
    
paragraph (1) shall be modified by adding thereto the sum of the following amounts:
            (A) An amount equal to all amounts paid or
        
accrued to the taxpayer as interest or dividends during the taxable year to the extent excluded from gross income in the computation of taxable income;
            (B) An amount equal to the amount of tax imposed
        
by this Act to the extent deducted from gross income for the taxable year;
            (C) The amount of deductions allowed to the
        
partnership pursuant to Section 707 (c) of the Internal Revenue Code in calculating its taxable income;
            (D) An amount equal to the amount of the capital
        
gain deduction allowable under the Internal Revenue Code, to the extent deducted from gross income in the computation of taxable income;
            (D-5) For taxable years 2001 and thereafter, an
        
amount equal to the bonus depreciation deduction taken on the taxpayer's federal income tax return for the taxable year under subsection (k) of Section 168 of the Internal Revenue Code;
            (D-6) If the taxpayer sells, transfers, abandons,
        
or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-5), then an amount equal to the aggregate amount of the deductions taken in all taxable years under subparagraph (O) with respect to that property.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was allowed in any taxable year to make a subtraction modification under subparagraph (O), then an amount equal to that subtraction modification.
            The taxpayer is required to make the addition
        
modification under this subparagraph only once with respect to any one piece of property;
            (D-7) An amount equal to the amount otherwise
        
allowed as a deduction in computing base income for interest paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact the foreign person's business activity outside the United States is 80% or more of the foreign person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the interest was paid, accrued, or incurred.
            This paragraph shall not apply to the following:
                (i) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such interest; or
                (ii) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person, during the same taxable
                
year, paid, accrued, or incurred, the interest to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
interest expense between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects an arm's-length interest rate and terms; or
                (iii) the taxpayer can establish, based on
            
clear and convincing evidence, that the interest paid, accrued, or incurred relates to a contract or agreement entered into at arm's-length rates and terms and the principal purpose for the payment is not federal or Illinois tax avoidance; or
                (iv) an item of interest paid, accrued, or
            
incurred, directly or indirectly, to a person if the taxpayer establishes by clear and convincing evidence that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f).
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act; and
            (D-8) An amount equal to the amount of intangible
        
expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, (i) for taxable years ending on or after December 31, 2004, to a foreign person who would be a member of the same unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income pursuant to Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the intangible expenses and costs were directly or indirectly paid, incurred or accrued. The preceding sentence shall not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(d)(2)(D-7) of this Act. As used in this subparagraph, the term "intangible expenses and costs" includes (1) expenses, losses, and costs for, or related to, the direct or indirect acquisition, use, maintenance or management, ownership, sale, exchange, or any other disposition of intangible property; (2) losses incurred, directly or indirectly, from factoring transactions or discounting transactions; (3) royalty, patent, technical, and copyright fees; (4) licensing fees; and (5) other similar expenses and costs. For purposes of this subparagraph, "intangible property" includes patents, patent applications, trade names, trademarks, service marks, copyrights, mask works, trade secrets, and similar types of intangible assets;
            This paragraph shall not apply to the following:
                (i) any item of intangible expenses
            
or costs paid, accrued, or incurred, directly or indirectly, from a transaction with a person who is subject in a foreign country or state, other than a state which requires mandatory unitary reporting, to a tax on or measured by net income with respect to such item; or
                (ii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, if the taxpayer can establish, based on a preponderance of the evidence, both of the following:
                    (a) the person during the same taxable
                
year paid, accrued, or incurred, the intangible expense or cost to a person that is not a related member, and
                    (b) the transaction giving rise to the
                
intangible expense or cost between the taxpayer and the person did not have as a principal purpose the avoidance of Illinois income tax, and is paid pursuant to a contract or agreement that reflects arm's-length terms; or
                (iii) any item of intangible expense or
            
cost paid, accrued, or incurred, directly or indirectly, from a transaction with a person if the taxpayer establishes by clear and convincing evidence, that the adjustments are unreasonable; or if the taxpayer and the Director agree in writing to the application or use of an alternative method of apportionment under Section 304(f);
                Nothing in this subsection shall preclude the
            
Director from making any other adjustment otherwise allowed under Section 404 of this Act for any tax year beginning after the effective date of this amendment provided such adjustment is made pursuant to regulation adopted by the Department and such regulations provide methods and standards by which the Department will utilize its authority under Section 404 of this Act;
            (D-9) For taxable years ending on or after
        
December 31, 2008, an amount equal to the amount of insurance premium expenses and costs otherwise allowed as a deduction in computing base income, and that were paid, accrued, or incurred, directly or indirectly, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304. The addition modification required by this subparagraph shall be reduced to the extent that dividends were included in base income of the unitary group for the same taxable year and received by the taxpayer or by a member of the taxpayer's unitary business group (including amounts included in gross income under Sections 951 through 964 of the Internal Revenue Code and amounts included in gross income under Section 78 of the Internal Revenue Code) with respect to the stock of the same person to whom the premiums and costs were directly or indirectly paid, incurred, or accrued. The preceding sentence does not apply to the extent that the same dividends caused a reduction to the addition modification required under Section 203(d)(2)(D-7) or Section 203(d)(2)(D-8) of this Act;
            (D-10) An amount equal to the credit allowable to
        
the taxpayer under Section 218(a) of this Act, determined without regard to Section 218(c) of this Act;
    and by deducting from the total so obtained the following
    
amounts:
            (E) The valuation limitation amount;
            (F) An amount equal to the amount of any tax
        
imposed by this Act which was refunded to the taxpayer and included in such total for the taxable year;
            (G) An amount equal to all amounts included in
        
taxable income as modified by subparagraphs (A), (B), (C) and (D) which are exempt from taxation by this State either by reason of its statutes or Constitution or by reason of the Constitution, treaties or statutes of the United States; provided that, in the case of any statute of this State that exempts income derived from bonds or other obligations from the tax imposed under this Act, the amount exempted shall be the interest net of bond premium amortization;
            (H) Any income of the partnership which
        
constitutes personal service income as defined in Section 1348 (b) (1) of the Internal Revenue Code (as in effect December 31, 1981) or a reasonable allowance for compensation paid or accrued for services rendered by partners to the partnership, whichever is greater; this subparagraph (H) is exempt from the provisions of Section 250;
            (I) An amount equal to all amounts of income
        
distributable to an entity subject to the Personal Property Tax Replacement Income Tax imposed by subsections (c) and (d) of Section 201 of this Act including amounts distributable to organizations exempt from federal income tax by reason of Section 501(a) of the Internal Revenue Code; this subparagraph (I) is exempt from the provisions of Section 250;
            (J) With the exception of any amounts subtracted
        
under subparagraph (G), an amount equal to the sum of all amounts disallowed as deductions by (i) Sections 171(a) (2), and 265(2) of the Internal Revenue Code, and all amounts of expenses allocable to interest and disallowed as deductions by Section 265(1) of the Internal Revenue Code; and (ii) for taxable years ending on or after August 13, 1999, Sections 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the Internal Revenue Code, plus, (iii) for taxable years ending on or after December 31, 2011, Section 45G(e)(3) of the Internal Revenue Code and, for taxable years ending on or after December 31, 2008, any amount included in gross income under Section 87 of the Internal Revenue Code; the provisions of this subparagraph are exempt from the provisions of Section 250;
            (K) An amount equal to those dividends included
        
in such total which were paid by a corporation which conducts business operations in a River Edge Redevelopment Zone or zones created under the River Edge Redevelopment Zone Act and conducts substantially all of its operations from a River Edge Redevelopment Zone or zones. This subparagraph (K) is exempt from the provisions of Section 250;
            (L) An amount equal to any contribution made to a
        
job training project established pursuant to the Real Property Tax Increment Allocation Redevelopment Act;
            (M) An amount equal to those dividends included
        
in such total that were paid by a corporation that conducts business operations in a federally designated Foreign Trade Zone or Sub-Zone and that is designated a High Impact Business located in Illinois; provided that dividends eligible for the deduction provided in subparagraph (K) of paragraph (2) of this subsection shall not be eligible for the deduction provided under this subparagraph (M);
            (N) An amount equal to the amount of the
        
deduction used to compute the federal income tax credit for restoration of substantial amounts held under claim of right for the taxable year pursuant to Section 1341 of the Internal Revenue Code;
            (O) For taxable years 2001 and thereafter, for
        
the taxable year in which the bonus depreciation deduction is taken on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code and for each applicable taxable year thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation
            
deduction taken for the taxable year on the taxpayer's federal income tax return on property for which the bonus depreciation deduction was taken in any year under subsection (k) of Section 168 of the Internal Revenue Code, but not including the bonus depreciation deduction;
                (2) for taxable years ending on or before
            
December 31, 2005, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                (3) for taxable years ending after December
            
31, 2005:
                    (i) for property on which a bonus
                
depreciation deduction of 30% of the adjusted basis was taken, "x" equals "y" multiplied by 30 and then divided by 70 (or "y" multiplied by 0.429); and
                    (ii) for property on which a bonus
                
depreciation deduction of 50% of the adjusted basis was taken, "x" equals "y" multiplied by 1.0.
            The aggregate amount deducted under this
        
subparagraph in all taxable years for any one piece of property may not exceed the amount of the bonus depreciation deduction taken on that property on the taxpayer's federal income tax return under subsection (k) of Section 168 of the Internal Revenue Code. This subparagraph (O) is exempt from the provisions of Section 250;
            (P) If the taxpayer sells, transfers, abandons,
        
or otherwise disposes of property for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-5), then an amount equal to that addition modification.
            If the taxpayer continues to own property through
        
the last day of the last tax year for which the taxpayer may claim a depreciation deduction for federal income tax purposes and for which the taxpayer was required in any taxable year to make an addition modification under subparagraph (D-5), then an amount equal to that addition modification.
            The taxpayer is allowed to take the deduction
        
under this subparagraph only once with respect to any one piece of property.
            This subparagraph (P) is exempt from the
        
provisions of Section 250;
            (Q) The amount of (i) any interest income (net of
        
the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-17), 203(b)(2)(E-12), 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed the amount of such addition modification and (ii) any income from intangible property (net of the deductions allocable thereto) taken into account for the taxable year with respect to a transaction with a taxpayer that is required to make an addition modification with respect to such transaction under Section 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 203(d)(2)(D-8), but not to exceed the amount of such addition modification. This subparagraph (Q) is exempt from Section 250;
            (R) An amount equal to the interest income taken
        
into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(d)(2)(D-7) for interest paid, accrued, or incurred, directly or indirectly, to the same person. This subparagraph (R) is exempt from Section 250;
            (S) An amount equal to the income from intangible
        
property taken into account for the taxable year (net of the deductions allocable thereto) with respect to transactions with (i) a foreign person who would be a member of the taxpayer's unitary business group but for the fact that the foreign person's business activity outside the United States is 80% or more of that person's total business activity and (ii) for taxable years ending on or after December 31, 2008, to a person who would be a member of the same unitary business group but for the fact that the person is prohibited under Section 1501(a)(27) from being included in the unitary business group because he or she is ordinarily required to apportion business income under different subsections of Section 304, but not to exceed the addition modification required to be made for the same taxable year under Section 203(d)(2)(D-8) for intangible expenses and costs paid, accrued, or incurred, directly or indirectly, to the same person. This subparagraph (S) is exempt from Section 250; and
            (T) For taxable years ending on or after
        
December 31, 2011, in the case of a taxpayer who was required to add back any insurance premiums under Section 203(d)(2)(D-9), such taxpayer may elect to subtract that part of a reimbursement received from the insurance company equal to the amount of the expense or loss (including expenses incurred by the insurance company) that would have been taken into account as a deduction for federal income tax purposes if the expense or loss had been uninsured. If a taxpayer makes the election provided for by this subparagraph (T), the insurer to which the premiums were paid must add back to income the amount subtracted by the taxpayer pursuant to this subparagraph (T). This subparagraph (T) is exempt from the provisions of Section 250.

 
    (e) Gross income; adjusted gross income; taxable income.
        (1) In general. Subject to the provisions of
    
paragraph (2) and subsection (b) (3), for purposes of this Section and Section 803(e), a taxpayer's gross income, adjusted gross income, or taxable income for the taxable year shall mean the amount of gross income, adjusted gross income or taxable income properly reportable for federal income tax purposes for the taxable year under the provisions of the Internal Revenue Code. Taxable income may be less than zero. However, for taxable years ending on or after December 31, 1986, net operating loss carryforwards from taxable years ending prior to December 31, 1986, may not exceed the sum of federal taxable income for the taxable year before net operating loss deduction, plus the excess of addition modifications over subtraction modifications for the taxable year. For taxable years ending prior to December 31, 1986, taxable income may never be an amount in excess of the net operating loss for the taxable year as defined in subsections (c) and (d) of Section 172 of the Internal Revenue Code, provided that when taxable income of a corporation (other than a Subchapter S corporation), trust, or estate is less than zero and addition modifications, other than those provided by subparagraph (E) of paragraph (2) of subsection (b) for corporations or subparagraph (E) of paragraph (2) of subsection (c) for trusts and estates, exceed subtraction modifications, an addition modification must be made under those subparagraphs for any other taxable year to which the taxable income less than zero (net operating loss) is applied under Section 172 of the Internal Revenue Code or under subparagraph (E) of paragraph (2) of this subsection (e) applied in conjunction with Section 172 of the Internal Revenue Code.
        (2) Special rule. For purposes of paragraph (1) of
    
this subsection, the taxable income properly reportable for federal income tax purposes shall mean:
            (A) Certain life insurance companies. In the
        
case of a life insurance company subject to the tax imposed by Section 801 of the Internal Revenue Code, life insurance company taxable income, plus the amount of distribution from pre-1984 policyholder surplus accounts as calculated under Section 815a of the Internal Revenue Code;
            (B) Certain other insurance companies. In the
        
case of mutual insurance companies subject to the tax imposed by Section 831 of the Internal Revenue Code, insurance company taxable income;
            (C) Regulated investment companies. In the case
        
of a regulated investment company subject to the tax imposed by Section 852 of the Internal Revenue Code, investment company taxable income;
            (D) Real estate investment trusts. In the case
        
of a real estate investment trust subject to the tax imposed by Section 857 of the Internal Revenue Code, real estate investment trust taxable income;
            (E) Consolidated corporations. In the case of a
        
corporation which is a member of an affiliated group of corporations filing a consolidated income tax return for the taxable year for federal income tax purposes, taxable income determined as if such corporation had filed a separate return for federal income tax purposes for the taxable year and each preceding taxable year for which it was a member of an affiliated group. For purposes of this subparagraph, the taxpayer's separate taxable income shall be determined as if the election provided by Section 243(b) (2) of the Internal Revenue Code had been in effect for all such years;
            (F) Cooperatives. In the case of a cooperative
        
corporation or association, the taxable income of such organization determined in accordance with the provisions of Section 1381 through 1388 of the Internal Revenue Code, but without regard to the prohibition against offsetting losses from patronage activities against income from nonpatronage activities; except that a cooperative corporation or association may make an election to follow its federal income tax treatment of patronage losses and nonpatronage losses. In the event such election is made, such losses shall be computed and carried over in a manner consistent with subsection (a) of Section 207 of this Act and apportioned by the apportionment factor reported by the cooperative on its Illinois income tax return filed for the taxable year in which the losses are incurred. The election shall be effective for all taxable years with original returns due on or after the date of the election. In addition, the cooperative may file an amended return or returns, as allowed under this Act, to provide that the election shall be effective for losses incurred or carried forward for taxable years occurring prior to the date of the election. Once made, the election may only be revoked upon approval of the Director. The Department shall adopt rules setting forth requirements for documenting the elections and any resulting Illinois net loss and the standards to be used by the Director in evaluating requests to revoke elections. Public Act 96-932 is declaratory of existing law;
            (G) Subchapter S corporations. In the case of:
        
(i) a Subchapter S corporation for which there is in effect an election for the taxable year under Section 1362 of the Internal Revenue Code, the taxable income of such corporation determined in accordance with Section 1363(b) of the Internal Revenue Code, except that taxable income shall take into account those items which are required by Section 1363(b)(1) of the Internal Revenue Code to be separately stated; and (ii) a Subchapter S corporation for which there is in effect a federal election to opt out of the provisions of the Subchapter S Revision Act of 1982 and have applied instead the prior federal Subchapter S rules as in effect on July 1, 1982, the taxable income of such corporation determined in accordance with the federal Subchapter S rules as in effect on July 1, 1982; and
            (H) Partnerships. In the case of a partnership,
        
taxable income determined in accordance with Section 703 of the Internal Revenue Code, except that taxable income shall take into account those items which are required by Section 703(a)(1) to be separately stated but which would be taken into account by an individual in calculating his taxable income.
        (3) Recapture of business expenses on disposition of
    
asset or business. Notwithstanding any other law to the contrary, if in prior years income from an asset or business has been classified as business income and in a later year is demonstrated to be non-business income, then all expenses, without limitation, deducted in such later year and in the 2 immediately preceding taxable years related to that asset or business that generated the non-business income shall be added back and recaptured as business income in the year of the disposition of the asset or business. Such amount shall be apportioned to Illinois using the greater of the apportionment fraction computed for the business under Section 304 of this Act for the taxable year or the average of the apportionment fractions computed for the business under Section 304 of this Act for the taxable year and for the 2 immediately preceding taxable years.

 
    (f) Valuation limitation amount.
        (1) In general. The valuation limitation amount
    
referred to in subsections (a) (2) (G), (c) (2) (I) and (d)(2) (E) is an amount equal to:
            (A) The sum of the pre-August 1, 1969
        
appreciation amounts (to the extent consisting of gain reportable under the provisions of Section 1245 or 1250 of the Internal Revenue Code) for all property in respect of which such gain was reported for the taxable year; plus
            (B) The lesser of (i) the sum of the pre-August
        
1, 1969 appreciation amounts (to the extent consisting of capital gain) for all property in respect of which such gain was reported for federal income tax purposes for the taxable year, or (ii) the net capital gain for the taxable year, reduced in either case by any amount of such gain included in the amount determined under subsection (a) (2) (F) or (c) (2) (H).
        (2) Pre-August 1, 1969 appreciation amount.
            (A) If the fair market value of property referred
        
to in paragraph (1) was readily ascertainable on August 1, 1969, the pre-August 1, 1969 appreciation amount for such property is the lesser of (i) the excess of such fair market value over the taxpayer's basis (for determining gain) for such property on that date (determined under the Internal Revenue Code as in effect on that date), or (ii) the total gain realized and reportable for federal income tax purposes in respect of the sale, exchange or other disposition of such property.
            (B) If the fair market value of property referred
        
to in paragraph (1) was not readily ascertainable on August 1, 1969, the pre-August 1, 1969 appreciation amount for such property is that amount which bears the same ratio to the total gain reported in respect of the property for federal income tax purposes for the taxable year, as the number of full calendar months in that part of the taxpayer's holding period for the property ending July 31, 1969 bears to the number of full calendar months in the taxpayer's entire holding period for the property.
            (C) The Department shall prescribe such
        
regulations as may be necessary to carry out the purposes of this paragraph.

 
    (g) Double deductions. Unless specifically provided otherwise, nothing in this Section shall permit the same item to be deducted more than once.
 
    (h) Legislative intention. Except as expressly provided by this Section there shall be no modifications or limitations on the amounts of income, gain, loss or deduction taken into account in determining gross income, adjusted gross income or taxable income for federal income tax purposes for the taxable year, or in the amount of such items entering into the computation of base income and net income under this Act for such taxable year, whether in respect of property values as of August 1, 1969 or otherwise.
(Source: P.A. 96-45, eff. 7-15-09; 96-120, eff. 8-4-09; 96-198, eff. 8-10-09; 96-328, eff. 8-11-09; 96-520, eff. 8-14-09; 96-835, eff. 12-16-09; 96-932, eff. 1-1-11; 96-935, eff. 6-21-10; 96-1214, eff. 7-22-10; 97-333, eff. 8-12-11; 97-507, eff. 8-23-11; 97-905, eff. 8-7-12.)

35 ILCS 5/204

    (35 ILCS 5/204) (from Ch. 120, par. 2-204)
    Sec. 204. Standard Exemption.
    (a) Allowance of exemption. In computing net income under this Act, there shall be allowed as an exemption the sum of the amounts determined under subsections (b), (c) and (d), multiplied by a fraction the numerator of which is the amount of the taxpayer's base income allocable to this State for the taxable year and the denominator of which is the taxpayer's total base income for the taxable year.
    (b) Basic amount. For the purpose of subsection (a) of this Section, except as provided by subsection (a) of Section 205 and in this subsection, each taxpayer shall be allowed a basic amount of $1000, except that for corporations the basic amount shall be zero for tax years ending on or after December 31, 2003, and for individuals the basic amount shall be:
        (1) for taxable years ending on or after December 31,
    
1998 and prior to December 31, 1999, $1,300;
        (2) for taxable years ending on or after December 31,
    
1999 and prior to December 31, 2000, $1,650;
        (3) for taxable years ending on or after December 31,
    
2000 and prior to December 31, 2012, $2,000;
        (4) for taxable years ending on or after December 31,
    
2012 and prior to December 31, 2013, $2,050;
        (5) for taxable years ending on or after December
    
31, 2013, $2,050 plus the cost-of-living adjustment under subsection (d-5).
For taxable years ending on or after December 31, 1992, a taxpayer whose Illinois base income exceeds the basic amount and who is claimed as a dependent on another person's tax return under the Internal Revenue Code shall not be allowed any basic amount under this subsection.
    (c) Additional amount for individuals. In the case of an individual taxpayer, there shall be allowed for the purpose of subsection (a), in addition to the basic amount provided by subsection (b), an additional exemption equal to the basic amount for each exemption in excess of one allowable to such individual taxpayer for the taxable year under Section 151 of the Internal Revenue Code.
    (d) Additional exemptions for an individual taxpayer and his or her spouse. In the case of an individual taxpayer and his or her spouse, he or she shall each be allowed additional exemptions as follows:
        (1) Additional exemption for taxpayer or spouse 65
    
years of age or older.
            (A) For taxpayer. An additional exemption of
        
$1,000 for the taxpayer if he or she has attained the age of 65 before the end of the taxable year.
            (B) For spouse when a joint return is not filed.
        
An additional exemption of $1,000 for the spouse of the taxpayer if a joint return is not made by the taxpayer and his spouse, and if the spouse has attained the age of 65 before the end of such taxable year, and, for the calendar year in which the taxable year of the taxpayer begins, has no gross income and is not the dependent of another taxpayer.
        (2) Additional exemption for blindness of taxpayer or
    
spouse.
            (A) For taxpayer. An additional exemption of
        
$1,000 for the taxpayer if he or she is blind at the end of the taxable year.
            (B) For spouse when a joint return is not filed.
        
An additional exemption of $1,000 for the spouse of the taxpayer if a separate return is made by the taxpayer, and if the spouse is blind and, for the calendar year in which the taxable year of the taxpayer begins, has no gross income and is not the dependent of another taxpayer. For purposes of this paragraph, the determination of whether the spouse is blind shall be made as of the end of the taxable year of the taxpayer; except that if the spouse dies during such taxable year such determination shall be made as of the time of such death.
            (C) Blindness defined. For purposes of this
        
subsection, an individual is blind only if his or her central visual acuity does not exceed 20/200 in the better eye with correcting lenses, or if his or her visual acuity is greater than 20/200 but is accompanied by a limitation in the fields of vision such that the widest diameter of the visual fields subtends an angle no greater than 20 degrees.
    (d-5) Cost-of-living adjustment. For purposes of item (5) of subsection (b), the cost-of-living adjustment for any calendar year and for taxable years ending prior to the end of the subsequent calendar year is equal to $2,050 times the percentage (if any) by which:
        (1) the Consumer Price Index for the preceding
    
calendar year, exceeds
        (2) the Consumer Price Index for the calendar year
    
2011.
    The Consumer Price Index for any calendar year is the average of the Consumer Price Index as of the close of the 12-month period ending on August 31 of that calendar year.
    The term "Consumer Price Index" means the last Consumer Price Index for All Urban Consumers published by the United States Department of Labor or any successor agency.
    If any cost-of-living adjustment is not a multiple of $25, that adjustment shall be rounded to the next lowest multiple of $25.
    (e) Cross reference. See Article 3 for the manner of determining base income allocable to this State.
    (f) Application of Section 250. Section 250 does not apply to the amendments to this Section made by Public Act 90-613.
(Source: P.A. 97-507, eff. 8-23-11; 97-652, eff. 6-1-12.)

35 ILCS 5/205

    (35 ILCS 5/205) (from Ch. 120, par. 2-205)
    Sec. 205. Exempt organizations.
    (a) Charitable, etc. organizations. The base income of an organization which is exempt from the federal income tax by reason of the Internal Revenue Code shall not be determined under section 203 of this Act, but shall be its unrelated business taxable income as determined under section 512 of the Internal Revenue Code, without any deduction for the tax imposed by this Act. The standard exemption provided by section 204 of this Act shall not be allowed in determining the net income of an organization to which this subsection applies.
    (b) Partnerships. A partnership as such shall not be subject to the tax imposed by subsection 201 (a) and (b) of this Act, but shall be subject to the replacement tax imposed by subsection 201 (c) and (d) of this Act and shall compute its base income as described in subsection (d) of Section 203 of this Act. For taxable years ending on or after December 31, 2004, an investment partnership, as defined in Section 1501(a)(11.5) of this Act, shall not be subject to the tax imposed by subsections (c) and (d) of Section 201 of this Act. A partnership shall file such returns and other information at such time and in such manner as may be required under Article 5 of this Act. The partners in a partnership shall be liable for the replacement tax imposed by subsection 201 (c) and (d) of this Act on such partnership, to the extent such tax is not paid by the partnership, as provided under the laws of Illinois governing the liability of partners for the obligations of a partnership. Persons carrying on business as partners shall be liable for the tax imposed by subsection 201 (a) and (b) of this Act only in their separate or individual capacities.
    (c) Subchapter S corporations. A Subchapter S corporation shall not be subject to the tax imposed by subsection 201 (a) and (b) of this Act but shall be subject to the replacement tax imposed by subsection 201 (c) and (d) of this Act and shall file such returns and other information at such time and in such manner as may be required under Article 5 of this Act.
    (d) Combat zone, terrorist attack, and certain other deaths. An individual relieved from the federal income tax for any taxable year by reason of section 692 of the Internal Revenue Code shall not be subject to the tax imposed by this Act for such taxable year.
    (e) Certain trusts. A common trust fund described in Section 584 of the Internal Revenue Code, and any other trust to the extent that the grantor is treated as the owner thereof under sections 671 through 678 of the Internal Revenue Code shall not be subject to the tax imposed by this Act.
    (f) Certain business activities. A person not otherwise subject to the tax imposed by this Act shall not become subject to the tax imposed by this Act by reason of:
        (1) that person's ownership of tangible personal
    
property located at the premises of a printer in this State with which the person has contracted for printing, or
        (2) activities of the person's employees or agents
    
located solely at the premises of a printer and related to quality control, distribution, or printing services performed by a printer in the State with which the person has contracted for printing.
    (g) A nonprofit risk organization that holds a certificate of authority under Article VIID of the Illinois Insurance Code is exempt from the tax imposed under this Act with respect to its activities or operations in furtherance of the powers conferred upon it under that Article VIID of the Illinois Insurance Code.
(Source: P.A. 97-507, eff. 8-23-11.)

35 ILCS 5/206

    (35 ILCS 5/206) (from Ch. 120, par. 2-206)
    Sec. 206. Tax credits for coal research and coal utilization equipment.
    (a) Until January 1, 2005, each corporation subject to this Act shall be entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 20% of the amount donated to the Illinois Center for Research on Sulfur in Coal.
    (b) Until January 1, 2005, each corporation subject to this Act shall be entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 5% of the amount spent during the taxable year by the corporation on equipment purchased for the purpose of maintaining or increasing the use of Illinois coal at any Illinois facility owned, leased or operated by the corporation. Such equipment shall be limited to direct coal combustion equipment and pollution control equipment necessary thereto. For purposes of this credit, the amount spent on qualifying equipment shall be defined as the basis of the equipment used to compute the depreciation deduction for federal income tax purposes.
    For tax years ending on or after December 31, 1987, the credit shall be allowed for the tax year in which the amount is donated or the equipment purchased is placed in service, or, if the amount of the credit exceeds the tax liability for that year, whether it exceeds the original liability or the liability as later amended, such excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit years. The credit shall be applied to the earliest year for which there is a liability. If there is credit from more than one tax year that is available to offset a liability, earlier credit shall be applied first.
(Source: P.A. 88-599, eff. 9-1-94.)

35 ILCS 5/207

    (35 ILCS 5/207) (from Ch. 120, par. 2-207)
    Sec. 207. Net Losses.
    (a) If after applying all of the (i) modifications provided for in paragraph (2) of Section 203(b), paragraph (2) of Section 203(c) and paragraph (2) of Section 203(d) and (ii) the allocation and apportionment provisions of Article 3 of this Act and subsection (c) of this Section, the taxpayer's net income results in a loss;
        (1) for any taxable year ending prior to December 31,
    
1999, such loss shall be allowed as a carryover or carryback deduction in the manner allowed under Section 172 of the Internal Revenue Code;
        (2) for any taxable year ending on or after December
    
31, 1999 and prior to December 31, 2003, such loss shall be allowed as a carryback to each of the 2 taxable years preceding the taxable year of such loss and shall be a net operating loss carryover to each of the 20 taxable years following the taxable year of such loss; and
        (3) for any taxable year ending on or after December
    
31, 2003, such loss shall be allowed as a net operating loss carryover to each of the 12 taxable years following the taxable year of such loss, except as provided in subsection (d).
    (a-5) Election to relinquish carryback and order of application of losses.
            (A) For losses incurred in tax years ending prior
        
to December 31, 2003, the taxpayer may elect to relinquish the entire carryback period with respect to such loss. Such election shall be made in the form and manner prescribed by the Department and shall be made by the due date (including extensions of time) for filing the taxpayer's return for the taxable year in which such loss is incurred, and such election, once made, shall be irrevocable.
            (B) The entire amount of such loss shall be
        
carried to the earliest taxable year to which such loss may be carried. The amount of such loss which shall be carried to each of the other taxable years shall be the excess, if any, of the amount of such loss over the sum of the deductions for carryback or carryover of such loss allowable for each of the prior taxable years to which such loss may be carried.
    (b) Any loss determined under subsection (a) of this Section must be carried back or carried forward in the same manner for purposes of subsections (a) and (b) of Section 201 of this Act as for purposes of subsections (c) and (d) of Section 201 of this Act.
    (c) Notwithstanding any other provision of this Act, for each taxable year ending on or after December 31, 2008, for purposes of computing the loss for the taxable year under subsection (a) of this Section and the deduction taken into account for the taxable year for a net operating loss carryover under paragraphs (1), (2), and (3) of subsection (a) of this Section, the loss and net operating loss carryover shall be reduced in an amount equal to the reduction to the net operating loss and net operating loss carryover to the taxable year, respectively, required under Section 108(b)(2)(A) of the Internal Revenue Code, multiplied by a fraction, the numerator of which is the amount of discharge of indebtedness income that is excluded from gross income for the taxable year (but only if the taxable year ends on or after December 31, 2008) under Section 108(a) of the Internal Revenue Code and that would have been allocated and apportioned to this State under Article 3 of this Act but for that exclusion, and the denominator of which is the total amount of discharge of indebtedness income excluded from gross income under Section 108(a) of the Internal Revenue Code for the taxable year. The reduction required under this subsection (c) shall be made after the determination of Illinois net income for the taxable year in which the indebtedness is discharged.
    (d) In the case of a corporation (other than a Subchapter S corporation), no carryover deduction shall be allowed under this Section for any taxable year ending after December 31, 2010 and prior to December 31, 2012, and no carryover deduction shall exceed $100,000 for any taxable year ending on or after December 31, 2012 and prior to December 31, 2014; provided that, for purposes of determining the taxable years to which a net loss may be carried under subsection (a) of this Section, no taxable year for which a deduction is disallowed under this subsection, or for which the deduction would exceed $100,000 if not for this subsection, shall be counted.
    (e) In the case of a residual interest holder in a real estate mortgage investment conduit subject to Section 860E of the Internal Revenue Code, the net loss in subsection (a) shall be equal to:
        (1) the amount computed under subsection (a),
    
without regard to this subsection (e), or if that amount is positive, zero;
        (2) minus an amount equal to the amount computed
    
under subsection (a), without regard to this subsection (e), minus the amount that would be computed under subsection (a) if the taxpayer's federal taxable income were computed without regard to Section 860E of the Internal Revenue Code and without regard to this subsection (e).
    The modification in this subsection (e) is exempt from the provisions of Section 250.
(Source: P.A. 96-1496, eff. 1-13-11; 97-507, eff. 8-23-11; 97-636, eff. 6-1-12.)

35 ILCS 5/208

    (35 ILCS 5/208) (from Ch. 120, par. 2-208)
    Sec. 208. Tax credit for residential real property taxes. Beginning with tax years ending on or after December 31, 1991, every individual taxpayer shall be entitled to a tax credit equal to 5% of real property taxes paid by such taxpayer during the taxable year on the principal residence of the taxpayer. In the case of multi-unit or multi-use structures and farm dwellings, the taxes on the taxpayer's principal residence shall be that portion of the total taxes which is attributable to such principal residence.
(Source: P.A. 87-17.)

35 ILCS 5/208.1

    (35 ILCS 5/208.1)
    Sec. 208.1. Homeowners' Tax Relief rebate.
    (a) The Department shall pay a rebate to taxpayers in the amount of the Illinois income tax credit allowed under Section 208 with respect to the taxpayer's 1999 Illinois income tax return for residential real property taxes paid on the principal residence of the taxpayer. The rebate shall not, however, exceed $300 per principal residence. The rebate shall be paid to all eligible taxpayers who have filed a 1999 Illinois income tax return on or before October 17, 2000.
    (b) Before June 30, 2000, the Comptroller shall order transferred and the Treasurer shall transfer $280,000,000 from the Tobacco Settlement Recovery Fund to the Homeowners' Tax Relief Fund, a special fund in the State Treasury. Subject to appropriation, the Department shall make the rebate payments out of the Homeowners' Tax Relief Fund.
    (c) The Department shall certify the names of the taxpayers whose returns were filed on or before July 17, 2000 and the rebate amounts to the Comptroller by August 15, 2000. The Comptroller shall mail the rebate warrants to these taxpayers by October 17, 2000.
    (d) The Department shall certify the names of the taxpayers whose returns were filed after July 17, 2000 and on or before October 17, 2000 and the rebate amounts to the Comptroller by November 17, 2000. The Comptroller shall mail the rebate warrants to these taxpayers by December 15, 2000.
    (e) Any unencumbered amount in the Homeowners' Tax Relief Fund on January 1, 2001 shall be transferred to the Budget Stabilization Fund, a special fund in the State Treasury, and any amount remaining in the Homeowners' Tax Relief Fund on July 1, 2001 shall be transferred to the Budget Stabilization Fund.
(Source: P.A. 91-703, eff. 5-16-00.)

35 ILCS 5/209

    (35 ILCS 5/209)
    Sec. 209. Tax Credit for "TECH-PREP" youth vocational programs.
    (a) Beginning with tax years ending on or after June 30, 1995, every taxpayer who is primarily engaged in manufacturing is allowed a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 20% of the taxpayer's direct payroll expenditures for which a credit has not already been claimed under subsection (j) of Section 201 of this Act, in the tax year for which the credit is claimed, for cooperative secondary school youth vocational programs in Illinois which are certified as qualifying TECH-PREP programs by the State Board of Education because the programs prepare students to be technically skilled workers and meet the performance standards of business and industry and the admission standards of higher education. The credit may also be claimed for personal services rendered to the taxpayer by a TECH-PREP student or instructor (i) which would be subject to the provisions of Article 7 of this Act if the student or instructor was an employee of the taxpayer and (ii) for which no credit under this Section is claimed by another taxpayer.
    (b) If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 2 taxable years following the excess credit year. The credit shall 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, the earlier credit shall be applied first.
    (c) A taxpayer claiming the credit provided by this Section shall maintain and record such information regarding its participation in a qualifying TECH-PREP program as the Department may require by regulation. When claiming the credit provided by this Section, the taxpayer shall provide such information regarding the taxpayer's participation in a qualifying TECH-PREP program as the Department of Revenue may require by regulation.
    (d) This Section does not apply to those programs with national standards that have been or in the future are approved by the U.S. Department of Labor, Bureau of Apprenticeship Training or any federal agency succeeding to the responsibilities of that Bureau.
(Source: P.A. 92-846, eff. 8-23-02.)

35 ILCS 5/210

    (35 ILCS 5/210)
    Sec. 210. Dependent care assistance program tax credit.
    (a) Beginning with tax years ending on or after June 30, 1995, each taxpayer who is primarily engaged in manufacturing is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 5% of the amount of expenditures by the taxpayer in the tax year for which the credit is claimed, reported pursuant to Section 129(d)(7) of the Internal Revenue Code, to provide in the Illinois premises of the taxpayer's workplace an on-site facility dependent care assistance program under Section 129 of the Internal Revenue Code.
    (b) If the amount of credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 2 taxable years following the excess credit year. The credit shall 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, the earlier credit shall be applied first.
    (c) A taxpayer claiming the credit provided by this Section shall maintain and record such information as the Department may require by regulation regarding the dependent care assistance program for which credit is claimed. When claiming the credit provided by this Section, the taxpayer shall provide such information regarding the taxpayer's provision of a dependent care assistance program under Section 129 of the Internal Revenue Code.
(Source: P.A. 88-505.)

35 ILCS 5/210.5

    (35 ILCS 5/210.5)
    Sec. 210.5. Tax credit for employee child care.
    (a) Each corporate taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to (i) for taxable years ending on or after December 31, 2000 and on or before December 31, 2004 and for taxable years ending on or after December 31, 2007, 30% of the start-up costs expended by the corporate taxpayer to provide a child care facility for the children of its employees and (ii) for taxable years ending on or after December 31, 2000, 5% of the annual amount paid by the corporate taxpayer in providing the child care facility for the children of its employees. The provisions of Section 250 do not apply to the credits allowed under this Section. If the 5% credit authorized under item (ii) of this subsection is claimed, the 5% credit authorized under Section 210 cannot also be claimed.
    To receive the tax credit under this Section a corporate taxpayer may either independently provide and operate a child care facility for the children of its employees or it may join in a partnership with one or more other corporations to jointly provide and operate a child care facility for the children of employees of the corporations in the partnership.
    (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) As used in this Section, "start-up costs" means planning, site-preparation, construction, renovation, or acquisition of a child care facility. As used in this Section, "child care facility" is limited to a child care facility located in Illinois.
    (d) A corporate taxpayer claiming the credit provided by this Section shall maintain and record such information as the Department may require by rule regarding the child care facility for which the credit is claimed.
(Source: P.A. 95-648, eff. 10-11-07.)

35 ILCS 5/211

    (35 ILCS 5/211)
    Sec. 211. Economic Development for a Growing Economy Tax Credit. For tax years beginning on or after January 1, 1999, a Taxpayer who has entered into an Agreement under the Economic Development for a Growing Economy Tax Credit Act is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act in an amount to be determined in the Agreement. 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. The Department, in cooperation with the Department of Commerce and Economic Opportunity, shall prescribe rules to enforce and administer the provisions of this Section. This Section is exempt from the provisions of Section 250 of this Act.
    The credit shall be subject to the conditions set forth in the Agreement and the following limitations:
        (1) The tax credit shall not exceed the Incremental
    
Income Tax (as defined in Section 5-5 of the Economic Development for a Growing Economy Tax Credit Act) with respect to the project.
        (2) The amount of the credit allowed during the tax
    
year plus the sum of all amounts allowed in prior years shall not exceed 100% of the aggregate amount expended by the Taxpayer during all prior tax years on approved costs defined by Agreement.
        (3) The amount of the credit shall be determined on
    
an annual basis. Except as applied in a carryover year pursuant to Section 211(4) of this Act, the credit may not be applied against any State income tax liability in more than 10 taxable years; provided, however, that (i) an eligible business certified by the Department of Commerce and Economic Opportunity under the Corporate Headquarters Relocation Act may not apply the credit against any of its State income tax liability in more than 15 taxable years and (ii) credits allowed to that eligible business are subject to the conditions and requirements set forth in Sections 5-35 and 5-45 of the Economic Development for a Growing Economy Tax Credit Act.
        (4) The credit may not exceed the amount of taxes
    
imposed pursuant to subsections (a) and (b) of Section 201 of this Act. Any credit that is unused in the year the credit is computed may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall 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, the earlier credit shall be applied first.
        (5) No credit shall be allowed with respect to any
    
Agreement for any taxable year ending after the Noncompliance Date. Upon receiving notification by the Department of Commerce and Economic Opportunity of the noncompliance of a Taxpayer with an Agreement, the Department shall notify the Taxpayer that no credit is allowed with respect to that Agreement for any taxable year ending after the Noncompliance Date, as stated in such notification. If any credit has been allowed with respect to an Agreement for a taxable year ending after the Noncompliance Date for that Agreement, any refund paid to the Taxpayer for that taxable year shall, to the extent of that credit allowed, be an erroneous refund within the meaning of Section 912 of this Act.
        (6) For purposes of this Section, the terms
    
"Agreement", "Incremental Income Tax", and "Noncompliance Date" have the same meaning as when used in the Economic Development for a Growing Economy Tax Credit Act.
(Source: P.A. 94-793, eff. 5-19-06.)

35 ILCS 5/212

    (35 ILCS 5/212)
    Sec. 212. Earned income tax credit.
    (a) With respect to the federal earned income tax credit allowed for the taxable year under Section 32 of the federal Internal Revenue Code, 26 U.S.C. 32, each individual taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to (i) 5% of the federal tax credit for each taxable year beginning on or after January 1, 2000 and ending prior to December 31, 2012, (ii) 7.5% of the federal tax credit for each taxable year beginning on or after January 1, 2012 and ending prior to December 31, 2013, and (iii) 10% of the federal tax credit for each taxable year beginning on or after January 1, 2013.
    For a non-resident or part-year resident, the amount of the credit under this Section shall be in proportion to the amount of income attributable to this State.
    (b) For taxable years beginning before January 1, 2003, in no event shall a credit under this Section reduce the taxpayer's liability to less than zero. For each taxable year beginning on or after January 1, 2003, if the amount of the credit exceeds the income tax liability for the applicable tax year, then the excess credit shall be refunded to the taxpayer. The amount of a refund shall not be included in the taxpayer's income or resources for the purposes of determining eligibility or benefit level in any means-tested benefit program administered by a governmental entity unless required by federal law.
    (c) This Section is exempt from the provisions of Section 250.
(Source: P.A. 97-652, eff. 6-1-12.)

35 ILCS 5/213

    (35 ILCS 5/213)
    Sec. 213. Film production services credit. For tax years beginning on or after January 1, 2004, a taxpayer who has been awarded a tax credit under the Film Production Services Tax Credit Act or under the Film Production Services Tax Credit Act of 2008 is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act in an amount determined by the Department of Commerce and Economic Opportunity under those Acts. If the taxpayer is a partnership or Subchapter S corporation, the credit is 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.
    A transfer of this credit may be made by the taxpayer earning the credit within one year after the credit is awarded in accordance with rules adopted by the Department of Commerce and Economic Opportunity.
    The Department, in cooperation with the Department of Commerce and Economic Opportunity, must prescribe rules to enforce and administer the provisions of this Section. This Section is exempt from the provisions of Section 250 of this Act.
    The credit may not be carried back. If the amount of the 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 shall 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, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer's liability to less than zero.
(Source: P.A. 94-171, eff. 7-11-05; 95-720, eff. 5-27-08.)

35 ILCS 5/214

    (35 ILCS 5/214)
    Sec. 214. Tax credit for affordable housing donations.
    (a) Beginning with taxable years ending on or after December 31, 2001 and until the taxable year ending on December 31, 2016, a taxpayer who makes a donation under Section 7.28 of the Illinois Housing Development Act is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 50% of the value of the donation. Partners, shareholders of subchapter S corporations, and owners of limited liability companies (if the limited liability company is treated as a partnership for purposes of federal and State income taxation) are entitled to a credit under this Section to be determined in accordance with the determination of income and distributive share of income under Sections 702 and 703 and subchapter S of the Internal Revenue Code. Persons or entities not subject to the tax imposed by subsections (a) and (b) of Section 201 and who make a donation under Section 7.28 of the Illinois Housing Development Act are entitled to a credit as described in this subsection and may transfer that credit as described in subsection (c).
    (b) If the amount of the 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 tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.
    (c) The transfer of the tax credit allowed under this Section may be made (i) to the purchaser of land that has been designated solely for affordable housing projects in accordance with the Illinois Housing Development Act or (ii) to another donor who has also made a donation in accordance with Section 7.28 of the Illinois Housing Development Act.
    (d) A taxpayer claiming the credit provided by this Section must maintain and record any information that the Department may require by regulation regarding the project for which the credit is claimed. When claiming the credit provided by this Section, the taxpayer must provide information regarding the taxpayer's donation to the project under the Illinois Housing Development Act.
(Source: P.A. 96-1276, eff. 7-26-10; 97-507, eff. 8-23-11.)

35 ILCS 5/215

    (35 ILCS 5/215)
    Sec. 215. (Repealed).
(Source: P.A. 93-23, eff. 6-20-03. Repealed by P.A. 93-1033, eff. 9-3-04.)

35 ILCS 5/216

    (35 ILCS 5/216)
    Sec. 216. Credit for wages paid to ex-felons.
    (a) For each taxable year beginning on or after January 1, 2007, each taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act in an amount equal to 5% of qualified wages paid by the taxpayer during the taxable year to one or more Illinois residents who are qualified ex-offenders. The total credit allowed to a taxpayer with respect to each qualified ex-offender may not exceed $1,500 for all taxable years. For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this Section to be determined 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.
    (b) For purposes of this Section, "qualified wages":
        (1) includes only wages that are subject to federal
    
unemployment tax under Section 3306 of the Internal Revenue Code, without regard to any dollar limitation contained in that Section;
        (2) does not include any amounts paid or incurred by
    
an employer for any period to any qualified ex-offender for whom the employer receives federally funded payments for on-the-job training of that qualified ex-offender for that period; and
        (3) includes only wages attributable to service
    
rendered during the one-year period beginning with the day the qualified ex-offender begins work for the employer.
    If the taxpayer has received any payment from a program established under Section 482(e)(1) of the federal Social Security Act with respect to a qualified ex-offender, then, for purposes of calculating the credit under this Section, the amount of the qualified wages paid to that qualified ex-offender must be reduced by the amount of the payment.
    (c) For purposes of this Section, "qualified ex-offender" means any person who:
        (1) has been convicted of a crime in this State or of
    
an offense in any other jurisdiction, not including any offense or attempted offense that would subject a person to registration under the Sex Offender Registration Act;
        (2) was sentenced to a period of incarceration in an
    
Illinois adult correctional center; and
        (3) was hired by the taxpayer within 3 years after
    
being released from an Illinois adult correctional center.
    (d) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the 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 tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.
    (e) This Section is exempt from the provisions of Section 250.
(Source: P.A. 98-165, eff. 8-5-13.)

35 ILCS 5/217

    (35 ILCS 5/217)
    Sec. 217. Credit for wages paid to qualified veterans.
    (a) For each taxable year beginning on or after January 1, 2007 and ending on or before December 30, 2010, each taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act in an amount equal to 5%, but in no event to exceed $600, of the gross wages paid by the taxpayer to a qualified veteran in the course of that veteran's sustained employment during the taxable year. For each taxable year beginning on or after January 1, 2010, each taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act in an amount equal to 10%, but in no event to exceed $1,200, of the gross wages paid by the taxpayer to a qualified veteran in the course of that veteran's sustained employment during the taxable year. For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this Section to be determined 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.
    (b) For purposes of this Section:
    "Qualified veteran" means an Illinois resident who: (i) was a member of the Armed Forces of the United States, a member of the Illinois National Guard, or a member of any reserve component of the Armed Forces of the United States; (ii) served on active duty in connection with Operation Desert Storm, Operation Enduring Freedom, or Operation Iraqi Freedom; (iii) has provided, to the taxpayer, documentation showing that he or she was honorably discharged; and (iv) was initially hired by the taxpayer on or after January 1, 2007.
    "Sustained employment" means a period of employment that is not less than 185 days during the taxable year.
    (c) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the 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 tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.
    (d) A taxpayer who claims a credit under this Section for a taxable year with respect to a veteran shall not be allowed a credit under Section 217.1 of this Act with respect to the same veteran for that taxable year.
(Source: P.A. 96-101, eff. 1-1-10; 97-767, eff. 7-9-12.)

35 ILCS 5/217.1

    (35 ILCS 5/217.1)
    Sec. 217.1. Credit for wages paid to qualified unemployed veterans.
    (a) For each taxable year ending on or after December 31, 2012 and on or before December 31, 2016, each taxpayer is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act in the amount equal to 20%, but in no event to exceed $5,000, of the gross wages paid by the taxpayer to a qualified veteran in the course of that veteran's sustained employment during each taxable year ending on or after the date of hire by the taxpayer if that veteran was unemployed for an aggregate period of 4 weeks or more during the 6-week period ending on the Saturday immediately preceding the date he or she was hired by the taxpayer. For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for the purposes of federal and State income taxation, there shall be allowed a credit under this Section to be determined 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.
    (b) For the purposes of this Section:
    "Qualified veteran" means an Illinois resident who: (i) was a member of the Armed Forces of the United States, a member of the Illinois National Guard, or a member of any reserve component of the Armed Forces of the United States; (ii) served on active duty on or after September 11, 2001; (iii) has provided, to the taxpayer, documentation showing that he or she was honorably discharged; and (iv) was initially hired by the taxpayer on or after June 1, 2012.
    "Sustained employment" means (i) a period of employment that is not less than 185 days following the date of hire or (ii) in the case of a veteran who was unemployed for an aggregate period of 6 months or more during the one-year period ending on the date the veteran was hired by the taxpayer, a period of employment that is more than 30 days following the date of hire. The period of sustained employment may be completed after the end of the taxable year in which the veteran is hired.
    A veteran is "unemployed" for a week if he or she (i) has received unemployment benefits (as defined in Section 202 of the Unemployment Insurance Act, including but not limited to federally funded unemployment benefits) for the week, or (ii) has not been employed since being honorably discharged.
    (c) In no event shall a credit under this Section reduce a taxpayer's liability to less than zero. If the amount of credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability for the 5 taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset liability, the earlier credit shall be applied first.
    (d) A taxpayer who claims a credit under this Section for a taxable year with respect to a veteran shall not be allowed a credit under Section 217 of this Act with respect to the same veteran for that taxable year.
(Source: P.A. 97-767, eff. 7-9-12.)

35 ILCS 5/218

    (35 ILCS 5/218)
    Sec. 218. Credit for student-assistance contributions.
    (a) For taxable years ending on or after December 31, 2009 and on or before December 30, 2020, each taxpayer who, during the taxable year, makes a contribution (i) to a specified individual College Savings Pool Account under Section 16.5 of the State Treasurer Act or (ii) to the Illinois Prepaid Tuition Trust Fund in an amount matching a contribution made in the same taxable year by an employee of the taxpayer to that Account or Fund is entitled to a credit against the tax imposed under subsections (a) and (b) of Section 201 in an amount equal to 25% of that matching contribution, but not to exceed $500 per contributing employee per taxable year.
    (b) For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there is allowed a credit under this Section to be determined 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.
    (c) The credit may not be carried back. If the amount of the 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 tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.
    (d) A taxpayer claiming the credit under this Section must maintain and record any information that the Illinois Student Assistance Commission, the Office of the State Treasurer, or the Department may require regarding the matching contribution for which the credit is claimed.
(Source: P.A. 96-198, eff. 8-10-09.)

35 ILCS 5/219

    (35 ILCS 5/219)
    Sec. 219. Historic preservation credit. For tax years beginning on or after January 1, 2010 and ending on or before December 31, 2015, a taxpayer who qualifies for a credit under the Historic Preservation Tax Credit Pilot Program Act is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act as provided in that Act. 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.
    If the amount of any tax credit awarded under this Section exceeds the qualified taxpayer's income tax liability for the year in which the qualified rehabilitation plan was placed in service, the excess amount may be carried forward or back as provided in the Historic Preservation Tax Credit Pilot Program Act.
(Source: P.A. 96-933, eff. 6-21-10.)

35 ILCS 5/220

    (35 ILCS 5/220)
    Sec. 220. Angel investment credit.
    (a) As used in this Section:
    "Applicant" means a corporation, partnership, limited liability company, or a natural person that makes an investment in a qualified new business venture. The term "applicant" does not include a corporation, partnership, limited liability company, or a natural person who has a direct or indirect ownership interest of at least 51% in the profits, capital, or value of the investment or a related member.
    "Claimant" means an applicant certified by the Department who files a claim for a credit under this Section.
    "Department" means the Department of Commerce and Economic Opportunity.
    "Qualified new business venture" means a business that is registered with the Department under this Section.
    "Related member" means a person that, with respect to the investment, is any one of the following:
        (1) An individual, if the individual and the members
    
of the individual's family (as defined in Section 318 of the Internal Revenue Code) own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the value of the outstanding profits, capital, stock, or other ownership interest in the applicant.
        (2) A partnership, estate, or trust and any partner
    
or beneficiary, if the partnership, estate, or trust and its partners or beneficiaries own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the profits, capital, stock, or other ownership interest in the applicant.
        (3) A corporation, and any party related to the
    
corporation in a manner that would require an attribution of stock from the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the applicant and any other related member own, in the aggregate, directly, indirectly, beneficially, or constructively, at least 50% of the value of the corporation's outstanding stock.
        (4) A corporation and any party related to that
    
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the corporation and all such related parties own, in the aggregate, at least 50% of the profits, capital, stock, or other ownership interest in the applicant.
        (5) A person to or from whom there is attribution of
    
stock ownership in accordance with Section 1563(e) of the Internal Revenue Code, except that for purposes of determining whether a person is a related member under this paragraph, "20%" shall be substituted for "5%" whenever "5%" appears in Section 1563(e) of the Internal Revenue Code.
    (b) For taxable years beginning after December 31, 2010, and ending on or before December 31, 2016, subject to the limitations provided in this Section, a claimant may claim, as a credit against the tax imposed under subsections (a) and (b) of Section 201 of this Act, an amount equal to 25% of the claimant's investment made directly in a qualified new business venture. In order for an investment in a qualified new business venture to be eligible for tax credits, the business must have applied for and received certification under subsection (e) for the taxable year in which the investment was made prior to the date on which the investment was made. The credit under this Section may not exceed the taxpayer's Illinois income tax liability for the taxable year. If the amount of the 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 shall 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, the earlier credit shall be applied first. In the case of a partnership or Subchapter S Corporation, the credit is 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.
    (c) The maximum amount of an applicant's investment that may be used as the basis for a credit under this Section is $2,000,000 for each investment made directly in a qualified new business venture.
    (d) The Department shall implement a program to certify an applicant for an angel investment credit. Upon satisfactory review, the Department shall issue a tax credit certificate stating the amount of the tax credit to which the applicant is entitled. The Department shall annually certify that the claimant's investment has been made and remains in the qualified new business venture for no less than 3 years.
    If an investment for which a claimant is allowed a credit under subsection (b) is held by the claimant for less than 3 years, or, if within that period of time the qualified new business venture is moved from the State of Illinois, the claimant shall pay to the Department of Revenue, in the manner prescribed by the Department of Revenue, the amount of the credit that the claimant received related to the investment.
    (e) The Department shall implement a program to register qualified new business ventures for purposes of this Section. A business desiring registration shall submit an application to the Department in each taxable year for which the business desires registration. The Department may register the business only if the business satisfies all of the following conditions:
        (1) it has its headquarters in this State;
        (2) at least 51% of the employees employed by the
    
business are employed in this State;
        (3) it has the potential for increasing jobs in this
    
State, increasing capital investment in this State, or both, and either of the following apply:
            (A) it is principally engaged in innovation in
        
any of the following: manufacturing; biotechnology; nanotechnology; communications; agricultural sciences; clean energy creation or storage technology; processing or assembling products, including medical devices, pharmaceuticals, computer software, computer hardware, semiconductors, other innovative technology products, or other products that are produced using manufacturing methods that are enabled by applying proprietary technology; or providing services that are enabled by applying proprietary technology; or
            (B) it is undertaking pre-commercialization
        
activity related to proprietary technology that includes conducting research, developing a new product or business process, or developing a service that is principally reliant on applying proprietary technology;
        (4) it is not principally engaged in real estate
    
development, insurance, banking, lending, lobbying, political consulting, professional services provided by attorneys, accountants, business consultants, physicians, or health care consultants, wholesale or retail trade, leisure, hospitality, transportation, or construction, except construction of power production plants that derive energy from a renewable energy resource, as defined in Section 1 of the Illinois Power Agency Act;
        (5) at the time it is first certified:
            (A) it has fewer than 100 employees;
            (B) it has been in operation in Illinois for not
        
more than 10 consecutive years prior to the year of certification; and
            (C) it has received not more than $10,000,000 in
        
aggregate private equity investment in cash;
        (6) (blank); and
        (7) it has received not more than $4,000,000 in
    
investments that qualified for tax credits under this Section.
    (f) The Department, in consultation with the Department of Revenue, shall adopt rules to administer this Section. The aggregate amount of the tax credits that may be claimed under this Section for investments made in qualified new business ventures shall be limited at $10,000,000 per calendar year.
    (g) A claimant may not sell or otherwise transfer a credit awarded under this Section to another person.
    (h) On or before March 1 of each year, the Department shall report to the Governor and to the General Assembly on the tax credit certificates awarded under this Section for the prior calendar year.
        (1) This report must include, for each tax credit
    
certificate awarded:
            (A) the name of the claimant and the amount of
        
credit awarded or allocated to that claimant;
            (B) the name and address of the qualified new
        
business venture that received the investment giving rise to the credit and the county in which the qualified new business venture is located; and
            (C) the date of approval by the Department of the
        
applications for the tax credit certificate.
        (2) The report must also include:
            (A) the total number of applicants and amount for
        
tax credit certificates awarded under this Section in the prior calendar year;
            (B) the total number of applications and amount
        
for which tax credit certificates were issued in the prior calendar year; and
            (C) the total tax credit certificates and amount
        
authorized under this Section for all calendar years.
(Source: P.A. 96-939, eff. 1-1-11; 97-507, eff. 8-23-11; 97-1097, eff. 8-24-12.)

35 ILCS 5/221

    (35 ILCS 5/221)
    Sec. 221. Rehabilitation costs; qualified historic properties; River Edge Redevelopment Zone.
    (a) For taxable years beginning on or after January 1, 2012 and ending prior to January 1, 2017, there shall be allowed a tax credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to 25% of qualified expenditures incurred by a qualified taxpayer during the taxable year in the restoration and preservation of a qualified historic structure located in a River Edge Redevelopment Zone pursuant to a qualified rehabilitation plan, provided that the total amount of such expenditures (i) must equal $5,000 or more and (ii) must exceed 50% of the purchase price of the property.
    (b) To obtain a tax credit pursuant to this Section, the taxpayer must apply with the Department of Commerce and Economic Opportunity. The Department of Commerce and Economic Opportunity, in consultation with the Historic Preservation Agency, shall determine the amount of eligible rehabilitation costs and expenses. The Historic Preservation Agency shall determine whether the rehabilitation is consistent with the standards of the Secretary of the United States Department of the Interior for rehabilitation. Upon completion and review of the project, the Department of Commerce and Economic Opportunity shall issue a certificate in the amount of the eligible credits. At the time the certificate is issued, an issuance fee up to the maximum amount of 2% of the amount of the credits issued by the certificate may be collected from the applicant to administer the provisions of this Section. If collected, this issuance fee shall be deposited into the Historic Property Administrative Fund, a special fund created in the State treasury. Subject to appropriation, moneys in the Historic Property Administrative Fund shall be evenly divided between the Department of Commerce and Economic Opportunity and the Historic Preservation Agency to reimburse the Department of Commerce and Economic Opportunity and the Historic Preservation Agency for the costs associated with administering this Section. The taxpayer must attach the certificate to the tax return on which the credits are to be claimed. The Department of Commerce and Economic Opportunity may adopt rules to implement this Section.
    (c) The tax credit under this Section may not reduce the taxpayer's liability to less than zero.
    (d) As used in this Section, the following terms have the following meanings.
    "Qualified expenditure" means all the costs and expenses defined as qualified rehabilitation expenditures under Section 47 of the federal Internal Revenue Code that were incurred in connection with a qualified historic structure.
    "Qualified historic structure" means a certified historic structure as defined under Section 47 (c)(3) of the federal Internal Revenue Code.
    "Qualified rehabilitation plan" means a project that is approved by the Historic Preservation Agency as being consistent with the standards in effect on the effective date of this amendatory Act of the 97th General Assembly for rehabilitation as adopted by the federal Secretary of the Interior.
    "Qualified taxpayer" means the owner of the qualified historic structure or any other person who qualifies for the federal rehabilitation credit allowed by Section 47 of the federal Internal Revenue Code with respect to that qualified historic structure. Partners, shareholders of subchapter S corporations, and owners of limited liability companies (if the limited liability company is treated as a partnership for purposes of federal and State income taxation) are entitled to a credit under this Section to be determined in accordance with the determination of income and distributive share of income under Sections 702 and 703 and subchapter S of the Internal Revenue Code, provided that credits granted to a partnership, a limited liability company taxed as a partnership, or other multiple owners of property shall be passed through to the partners, members, or owners respectively on a pro rata basis or pursuant to an executed agreement among the partners, members, or owners documenting any alternate distribution method.
(Source: P.A. 97-203, eff. 7-28-11.)

35 ILCS 5/222

    (35 ILCS 5/222)
    Sec. 222. Live theater production credit.
    (a) For tax years beginning on or after January 1, 2012, a taxpayer who has received a tax credit award under the Live Theater Production Tax Credit Act is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act in an amount determined under that Act by the Department of Commerce and Economic Opportunity.
    (b) If the taxpayer is a partnership, limited liability partnership, limited liability company, or Subchapter S corporation, the tax credit award is allowed to the partners, unit holders, 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.
    (c) A sale, assignment, or transfer of the tax credit award may be made by the taxpayer earning the credit within one year after the credit is awarded in accordance with rules adopted by the Department of Commerce and Economic Opportunity.
    (d) The Department of Revenue, in cooperation with the Department of Commerce and Economic Opportunity, shall adopt rules to enforce and administer the provisions of this Section.
    (e) The tax credit award may not be carried back. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 tax years following the excess credit year. The tax credit award shall 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 liability, the earlier credit shall be applied first. In no event may a credit under this Section reduce the taxpayer's liability to less than zero.
(Source: P.A. 97-636, eff. 6-1-12.)

35 ILCS 5/223

    (35 ILCS 5/223)
    Sec. 223. Hospital credit.
    (a) For tax years ending on or after December 31, 2012, a taxpayer that is the owner of a hospital licensed under the Hospital Licensing Act, but not including an organization that is exempt from federal income taxes under the Internal Revenue Code, is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act in an amount equal to the lesser of the amount of real property taxes paid during the tax year on real property used for hospital purposes during the prior tax year or the cost of free or discounted services provided during the tax year pursuant to the hospital's charitable financial assistance policy, measured at cost.
    (b) If the taxpayer is a partnership or Subchapter S corporation, the credit is 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. A transfer of this credit may be made by the taxpayer earning the credit within one year after the credit is earned in accordance with rules adopted by the Department. The Department shall prescribe rules to enforce and administer provisions of this Section. If the amount of the credit exceeds the tax liability for the year, then the excess credit may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall 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, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer's liability to less than zero.
(Source: P.A. 97-688, eff. 6-14-12.)

35 ILCS 5/245

    (35 ILCS 5/245)
    Sec. 245. The Do-It-Yourself School Funding Law. On any original return for a taxable year ending on or after December 31, 1998 and prior to December 31, 2000, a taxpayer shall have the option to forgo claiming the exemptions provided under subsections (b) and (c) of Section 204 or the tax credit provided under Section 208 and instead may direct that the additional amount of tax resulting from not claiming the exemptions or credit shall be deposited into the Do-It-Yourself School Funding Fund.
(Source: P.A. 90-553, eff. 6-1-98.)

35 ILCS 5/250

    (35 ILCS 5/250)
    Sec. 250. Sunset of exemptions, credits, and deductions.
    (a) The application of every exemption, credit, and deduction against tax imposed by this Act that becomes law after the effective date of this amendatory Act of 1994 shall be limited by a reasonable and appropriate sunset date. A taxpayer is not entitled to take the exemption, credit, or deduction for tax years beginning on or after the sunset date. Except as provided in subsection (b) of this Section, if a reasonable and appropriate sunset date is not specified in the Public Act that creates the exemption, credit, or deduction, a taxpayer shall not be entitled to take the exemption, credit, or deduction for tax years beginning on or after 5 years after the effective date of the Public Act creating the exemption, credit, or deduction and thereafter; provided, however, that in the case of any Public Act authorizing the issuance of tax-exempt obligations that does not specify a sunset date for the exemption or deduction of income derived from the obligations, the exemption or deduction shall not terminate until after the obligations have been paid by the issuer.
    (b) Notwithstanding the provisions of subsection (a) of this Section, the sunset date of any exemption, credit, or deduction that is scheduled to expire in 2011, 2012, or 2013 by operation of this Section shall be extended by 5 years.
(Source: P.A. 97-636, eff. 6-1-12.)

35 ILCS 5/Art. 3

 
    (35 ILCS 5/Art. 3 heading)
ARTICLE 3. ALLOCATION AND APPORTIONMENT OF BASE INCOME.

35 ILCS 5/301

    (35 ILCS 5/301) (from Ch. 120, par. 3-301)
    Sec. 301. General Rule.
    (a) Residents. All items of income or deduction which were taken into account in the computation of base income for the taxable year by a resident shall be allocated to this State.
    (b) Part-year residents. All items of income or deduction which were taken into account in the computation of base income for the taxable year by a part-year resident shall, for that part of the year the part-year resident was a resident of this State, be allocated to this State and, for the remaining part of the year, be allocated to this State only to the extent provided by Section 302, 303 or 304 (relating to compensation, nonbusiness income and business income, respectively).
    (c) Other persons.
        (1) In general. Any item of income or deduction which
    
was taken into account in the computation of base income for the taxable year by any person other than a resident and which is referred to in Section 302, 303 or 304 (relating to compensation, nonbusiness income and business income, respectively) shall be allocated to this State only to the extent provided by such section.
        (2) Unspecified items. Any item of income or
    
deduction which was taken into account in the computation of base income for the taxable year by any person other than a resident and which is not otherwise specifically allocated or apportioned pursuant to Section 302, 303 or 304 (including, without limitation, interest, dividends, items of income taken into account under the provisions of Sections 401 through 425 of the Internal Revenue Code, and benefit payments received by a beneficiary of a supplemental unemployment benefit trust which is referred to in Section 501(c)(17) of the Internal Revenue Code):
            (A) in the case of an individual, trust, or
        
estate, shall not be allocated to this State; and
            (B) in the case of a corporation or a
        
partnership, shall be allocated to this State if the taxpayer had its commercial domicile in this State at the time such item was paid, incurred or accrued.
(Source: P.A. 90-491, eff. 1-1-98; 90-562, eff. 12-16-97.)

35 ILCS 5/302

    (35 ILCS 5/302) (from Ch. 120, par. 3-302)
    Sec. 302. Compensation paid to nonresidents.
    (a) In general. All items of compensation paid in this State (as determined under Section 304(a)(2)(B)) to an individual who is a nonresident at the time of such payment and all items of deduction directly allocable thereto, shall be allocated to this State.
    (b) Reciprocal exemption. The Director may enter into an agreement with the taxing authorities of any state which imposes a tax on or measured by income to provide that compensation paid in such state to residents of this State shall be exempt from such tax; in such case, any compensation paid in this State to residents of such state shall not be allocated to this State. All reciprocal agreements shall be subject to the requirements of Section 2505-575 of the Department of Revenue Law (20 ILCS 2505/2505-575).
    (c) Cross references.
        (1) For allocation of amounts received by
    
nonresidents from certain employee trusts, see Section 301(b)(2).
        (2) For allocation of compensation by residents, see
    
Section 301(a).
(Source: P.A. 90-491, eff. 1-1-98; 91-239, eff. 1-1-00.)

35 ILCS 5/303

    (35 ILCS 5/303) (from Ch. 120, par. 3-303)
    Sec. 303. (a) In general. Any item of capital gain or loss, and any item of income from rents or royalties from real or tangible personal property, interest, dividends, and patent or copyright royalties, and prizes awarded under the Illinois Lottery Law, to the extent such item constitutes nonbusiness income, together with any item of deduction directly allocable thereto, shall be allocated by any person other than a resident as provided in this Section.
    (b) Capital gains and losses.
        (1) Real property. Capital gains and losses from
    
sales or exchanges of real property are allocable to this State if the property is located in this State.
        (2) Tangible personal property. Capital gains and
    
losses from sales or exchanges of tangible personal property are allocable to this State if, at the time of such sale or exchange:
            (A) The property had its situs in this State; or
            (B) The taxpayer had its commercial domicile in
        
this State and was not taxable in the state in which the property had its situs.
        (3) Intangibles. Capital gains and losses from sales
    
or exchanges of intangible personal property are allocable to this State if the taxpayer had its commercial domicile in this State at the time of such sale or exchange.
    (c) Rents and royalties.
        (1) Real property. Rents and royalties from real
    
property are allocable to this State if the property is located in this State.
        (2) Tangible personal property. Rents and royalties
    
from tangible personal property are allocable to this State:
            (A) If and to the extent that the property is
        
utilized in this State; or
            (B) In their entirety if, at the time such rents
        
or royalties were paid or accrued, the taxpayer had its commercial domicile in this State and was not organized under the laws of or taxable with respect to such rents or royalties in the state in which the property was utilized. The extent of utilization of tangible personal property in a state is determined by multiplying the rents or royalties derived from such property by a fraction, the numerator of which is the number of days of physical location of the property in the state during the rental or royalty period in the taxable year and the denominator of which is the number of days of physical location of the property everywhere during all rental or royalty periods in the taxable year. If the physical location of the property during the rental or royalty period is unknown or unascertainable by the taxpayer, tangible personal property is utilized in the state in which the property was located at the time the rental or royalty payer obtained possession.
    (d) Patent and copyright royalties.
        (1) Allocation. Patent and copyright royalties are
    
allocable to this State:
            (A) If and to the extent that the patent or
        
copyright is utilized by the payer in this State; or
            (B) If and to the extent that the patent or
        
copyright is utilized by the payer in a state in which the taxpayer is not taxable with respect to such royalties and, at the time such royalties were paid or accrued, the taxpayer had its commercial domicile in this State.
        (2) Utilization.
            (A) A patent is utilized in a state to the extent
        
that it is employed in production, fabrication, manufacturing or other processing in the state or to the extent that a patented product is produced in the state. If the basis of receipts from patent royalties does not permit allocation to states or if the accounting procedures do not reflect states of utilization, the patent is utilized in this State if the taxpayer has its commercial domicile in this State.
            (B) A copyright is utilized in a state to the
        
extent that printing or other publication originates in the state. If the basis of receipts from copyright royalties does not permit allocation to states or if the accounting procedures do not reflect states of utilization, the copyright is utilized in this State if the taxpayer has its commercial domicile in this State.
    (e) Illinois lottery prizes. Prizes awarded under the Illinois Lottery Law are allocable to this State. Payments received in taxable years ending on or after December 31, 2013, from the assignment of a prize under Section 13.1 of the Illinois Lottery Law are allocable to this State.
    (e-5) Unemployment benefits. Unemployment benefits paid by the Illinois Department of Employment Security are allocable to this State.
    (f) Taxability in other state. For purposes of allocation of income pursuant to this Section, a taxpayer is taxable in another state if:
        (1) In that state he is subject to a net income tax,
    
a franchise tax measured by net income, a franchise tax for the privilege of doing business, or a corporate stock tax; or
        (2) That state has jurisdiction to subject the
    
taxpayer to a net income tax regardless of whether, in fact, the state does or does not.
    (g) Cross references.
        (1) For allocation of interest and dividends by
    
persons other than residents, see Section 301(c)(2).
        (2) For allocation of nonbusiness income by
    
residents, see Section 301(a).
(Source: P.A. 97-709, eff. 7-1-12; 98-496, eff. 1-1-14.)

35 ILCS 5/304

    (35 ILCS 5/304) (from Ch. 120, par. 3-304)
    Sec. 304. Business income of persons other than residents.
    (a) In general. The business income of a person other than a resident shall be allocated to this State if such person's business income is derived solely from this State. If a person other than a resident derives business income from this State and one or more other states, then, for tax years ending on or before December 30, 1998, and except as otherwise provided by this Section, such person's business income shall be apportioned to this State by multiplying the income by a fraction, the numerator of which is the sum of the property factor (if any), the payroll factor (if any) and 200% of the sales factor (if any), and the denominator of which is 4 reduced by the number of factors other than the sales factor which have a denominator of zero and by an additional 2 if the sales factor has a denominator of zero. For tax years ending on or after December 31, 1998, and except as otherwise provided by this Section, persons other than residents who derive business income from this State and one or more other states shall compute their apportionment factor by weighting their property, payroll, and sales factors as provided in subsection (h) of this Section.
    (1) Property factor.
        (A) The property factor is a fraction, the numerator
    
of which is the average value of the person's real and tangible personal property owned or rented and used in the trade or business in this State during the taxable year and the denominator of which is the average value of all the person's real and tangible personal property owned or rented and used in the trade or business during the taxable year.
        (B) Property owned by the person is valued at its
    
original cost. Property rented by the person is valued at 8 times the net annual rental rate. Net annual rental rate is the annual rental rate paid by the person less any annual rental rate received by the person from sub-rentals.
        (C) The average value of property shall be determined
    
by averaging the values at the beginning and ending of the taxable year but the Director may require the averaging of monthly values during the taxable year if reasonably required to reflect properly the average value of the person's property.
    (2) Payroll factor.
        (A) The payroll factor is a fraction, the numerator
    
of which is the total amount paid in this State during the taxable year by the person for compensation, and the denominator of which is the total compensation paid everywhere during the taxable year.
        (B) Compensation is paid in this State if:
            (i) The individual's service is performed
        
entirely within this State;
            (ii) The individual's service is performed both
        
within and without this State, but the service performed without this State is incidental to the individual's service performed within this State; or
            (iii) Some of the service is performed within
        
this State and either the base of operations, or if there is no base of operations, the place from which the service is directed or controlled is within this State, or the base of operations or the place from which the service is directed or controlled is not in any state in which some part of the service is performed, but the individual's residence is in this State.
            (iv) Compensation paid to nonresident
        
professional athletes.
            (a) General. The Illinois source income of a
        
nonresident individual who is a member of a professional athletic team includes the portion of the individual's total compensation for services performed as a member of a professional athletic team during the taxable year which the number of duty days spent within this State performing services for the team in any manner during the taxable year bears to the total number of duty days spent both within and without this State during the taxable year.
            (b) Travel days. Travel days that do not involve
        
either a game, practice, team meeting, or other similar team event are not considered duty days spent in this State. However, such travel days are considered in the total duty days spent both within and without this State.
            (c) Definitions. For purposes of this subpart
        
(iv):
                (1) The term "professional athletic team"
            
includes, but is not limited to, any professional baseball, basketball, football, soccer, or hockey team.
                (2) The term "member of a professional
            
athletic team" includes those employees who are active players, players on the disabled list, and any other persons required to travel and who travel with and perform services on behalf of a professional athletic team on a regular basis. This includes, but is not limited to, coaches, managers, and trainers.
                (3) Except as provided in items (C) and (D)
            
of this subpart (3), the term "duty days" means all days during the taxable year from the beginning of the professional athletic team's official pre-season training period through the last game in which the team competes or is scheduled to compete. Duty days shall be counted for the year in which they occur, including where a team's official pre-season training period through the last game in which the team competes or is scheduled to compete, occurs during more than one tax year.
                    (A) Duty days shall also include days on
                
which a member of a professional athletic team performs service for a team on a date that does not fall within the foregoing period (e.g., participation in instructional leagues, the "All Star Game", or promotional "caravans"). Performing a service for a professional athletic team includes conducting training and rehabilitation activities, when such activities are conducted at team facilities.
                    (B) Also included in duty days are game
                
days, practice days, days spent at team meetings, promotional caravans, preseason training camps, and days served with the team through all post-season games in which the team competes or is scheduled to compete.
                    (C) Duty days for any person who joins a
                
team during the period from the beginning of the professional athletic team's official pre-season training period through the last game in which the team competes, or is scheduled to compete, shall begin on the day that person joins the team. Conversely, duty days for any person who leaves a team during this period shall end on the day that person leaves the team. Where a person switches teams during a taxable year, a separate duty-day calculation shall be made for the period the person was with each team.
                    (D) Days for which a member of a
                
professional athletic team is not compensated and is not performing services for the team in any manner, including days when such member of a professional athletic team has been suspended without pay and prohibited from performing any services for the team, shall not be treated as duty days.
                    (E) Days for which a member of a
                
professional athletic team is on the disabled list and does not conduct rehabilitation activities at facilities of the team, and is not otherwise performing services for the team in Illinois, shall not be considered duty days spent in this State. All days on the disabled list, however, are considered to be included in total duty days spent both within and without this State.
                (4) The term "total compensation for services
            
performed as a member of a professional athletic team" means the total compensation received during the taxable year for services performed:
                    (A) from the beginning of the official
                
pre-season training period through the last game in which the team competes or is scheduled to compete during that taxable year; and
                    (B) during the taxable year on a date
                
which does not fall within the foregoing period (e.g., participation in instructional leagues, the "All Star Game", or promotional caravans).
                This compensation shall include, but is not
            
limited to, salaries, wages, bonuses as described in this subpart, and any other type of compensation paid during the taxable year to a member of a professional athletic team for services performed in that year. This compensation does not include strike benefits, severance pay, termination pay, contract or option year buy-out payments, expansion or relocation payments, or any other payments not related to services performed for the team.
                For purposes of this subparagraph, "bonuses"
            
included in "total compensation for services performed as a member of a professional athletic team" subject to the allocation described in Section 302(c)(1) are: bonuses earned as a result of play (i.e., performance bonuses) during the season, including bonuses paid for championship, playoff or "bowl" games played by a team, or for selection to all-star league or other honorary positions; and bonuses paid for signing a contract, unless the payment of the signing bonus is not conditional upon the signee playing any games for the team or performing any subsequent services for the team or even making the team, the signing bonus is payable separately from the salary and any other compensation, and the signing bonus is nonrefundable.
    (3) Sales factor.
        (A) The sales factor is a fraction, the numerator of
    
which is the total sales of the person in this State during the taxable year, and the denominator of which is the total sales of the person everywhere during the taxable year.
        (B) Sales of tangible personal property are in this
    
State if:
            (i) The property is delivered or shipped to a
        
purchaser, other than the United States government, within this State regardless of the f. o. b. point or other conditions of the sale; or
            (ii) The property is shipped from an office,
        
store, warehouse, factory or other place of storage in this State and either the purchaser is the United States government or the person is not taxable in the state of the purchaser; provided, however, that premises owned or leased by a person who has independently contracted with the seller for the printing of newspapers, periodicals or books shall not be deemed to be an office, store, warehouse, factory or other place of storage for purposes of this Section. Sales of tangible personal property are not in this State if the seller and purchaser would be members of the same unitary business group but for the fact that either the seller or purchaser is a person with 80% or more of total business activity outside of the United States and the property is purchased for resale.
        (B-1) Patents, copyrights, trademarks, and similar
    
items of intangible personal property.
            (i) Gross receipts from the licensing, sale, or
        
other disposition of a patent, copyright, trademark, or similar item of intangible personal property, other than gross receipts governed by paragraph (B-7) of this item (3), are in this State to the extent the item is utilized in this State during the year the gross receipts are included in gross income.
            (ii) Place of utilization.
                (I) A patent is utilized in a state to the
            
extent that it is employed in production, fabrication, manufacturing, or other processing in the state or to the extent that a patented product is produced in the state. If a patent is utilized in more than one state, the extent to which it is utilized in any one state shall be a fraction equal to the gross receipts of the licensee or purchaser from sales or leases of items produced, fabricated, manufactured, or processed within that state using the patent and of patented items produced within that state, divided by the total of such gross receipts for all states in which the patent is utilized.
                (II) A copyright is utilized in a state to
            
the extent that printing or other publication originates in the state. If a copyright is utilized in more than one state, the extent to which it is utilized in any one state shall be a fraction equal to the gross receipts from sales or licenses of materials printed or published in that state divided by the total of such gross receipts for all states in which the copyright is utilized.
                (III) Trademarks and other items of
            
intangible personal property governed by this paragraph (B-1) are utilized in the state in which the commercial domicile of the licensee or purchaser is located.
            (iii) If the state of utilization of an item of
        
property governed by this paragraph (B-1) cannot be determined from the taxpayer's books and records or from the books and records of any person related to the taxpayer within the meaning of Section 267(b) of the Internal Revenue Code, 26 U.S.C. 267, the gross receipts attributable to that item shall be excluded from both the numerator and the denominator of the sales factor.
        (B-2) Gross receipts from the license, sale, or other
    
disposition of patents, copyrights, trademarks, and similar items of intangible personal property, other than gross receipts governed by paragraph (B-7) of this item (3), may be included in the numerator or denominator of the sales factor only if gross receipts from licenses, sales, or other disposition of such items comprise more than 50% of the taxpayer's total gross receipts included in gross income during the tax year and during each of the 2 immediately preceding tax years; provided that, when a taxpayer is a member of a unitary business group, such determination shall be made on the basis of the gross receipts of the entire unitary business group.
        (B-5) For taxable years ending on or after December
    
31, 2008, except as provided in subsections (ii) through (vii), receipts from the sale of telecommunications service or mobile telecommunications service are in this State if the customer's service address is in this State.
            (i) For purposes of this subparagraph (B-5), the
        
following terms have the following meanings:
            "Ancillary services" means services that are
        
associated with or incidental to the provision of "telecommunications services", including but not limited to "detailed telecommunications billing", "directory assistance", "vertical service", and "voice mail services".
            "Air-to-Ground Radiotelephone service" means a
        
radio service, as that term is defined in 47 CFR 22.99, in which common carriers are authorized to offer and provide radio telecommunications service for hire to subscribers in aircraft.
            "Call-by-call Basis" means any method of charging
        
for telecommunications services where the price is measured by individual calls.
            "Communications Channel" means a physical or
        
virtual path of communications over which signals are transmitted between or among customer channel termination points.
            "Conference bridging service" means an "ancillary
        
service" that links two or more participants of an audio or video conference call and may include the provision of a telephone number. "Conference bridging service" does not include the "telecommunications services" used to reach the conference bridge.
            "Customer Channel Termination Point" means the
        
location where the customer either inputs or receives the communications.
            "Detailed telecommunications billing service"
        
means an "ancillary service" of separately stating information pertaining to individual calls on a customer's billing statement.
            "Directory assistance" means an "ancillary
        
service" of providing telephone number information, and/or address information.
            "Home service provider" means the facilities
        
based carrier or reseller with which the customer contracts for the provision of mobile telecommunications services.
            "Mobile telecommunications service" means
        
commercial mobile radio service, as defined in Section 20.3 of Title 47 of the Code of Federal Regulations as in effect on June 1, 1999.
            "Place of primary use" means the street address
        
representative of where the customer's use of the telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer. In the case of mobile telecommunications services, "place of primary use" must be within the licensed service area of the home service provider.
            "Post-paid telecommunication service" means the
        
telecommunications service obtained by making a payment on a call-by-call basis either through the use of a credit card or payment mechanism such as a bank card, travel card, credit card, or debit card, or by charge made to a telephone number which is not associated with the origination or termination of the telecommunications service. A post-paid calling service includes telecommunications service, except a prepaid wireless calling service, that would be a prepaid calling service except it is not exclusively a telecommunication service.
            "Prepaid telecommunication service" means the
        
right to access exclusively telecommunications services, which must be paid for in advance and which enables the origination of calls using an access number or authorization code, whether manually or electronically dialed, and that is sold in predetermined units or dollars of which the number declines with use in a known amount.
            "Prepaid Mobile telecommunication service" means
        
a telecommunications service that provides the right to utilize mobile wireless service as well as other non-telecommunication services, including but not limited to ancillary services, which must be paid for in advance that is sold in predetermined units or dollars of which the number declines with use in a known amount.
            "Private communication service" means a
        
telecommunication service that entitles the customer to exclusive or priority use of a communications channel or group of channels between or among termination points, regardless of the manner in which such channel or channels are connected, and includes switching capacity, extension lines, stations, and any other associated services that are provided in connection with the use of such channel or channels.
            "Service address" means:
                (a) The location of the telecommunications
            
equipment to which a customer's call is charged and from which the call originates or terminates, regardless of where the call is billed or paid;
                (b) If the location in line (a) is not known,
            
service address means the origination point of the signal of the telecommunications services first identified by either the seller's telecommunications system or in information received by the seller from its service provider where the system used to transport such signals is not that of the seller; and
                (c) If the locations in line (a) and line (b)
            
are not known, the service address means the location of the customer's place of primary use.
            "Telecommunications service" means the electronic
        
transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point, or between or among points. The term "telecommunications service" includes such transmission, conveyance, or routing in which computer processing applications are used to act on the form, code or protocol of the content for purposes of transmission, conveyance or routing without regard to whether such service is referred to as voice over Internet protocol services or is classified by the Federal Communications Commission as enhanced or value added. "Telecommunications service" does not include:
                (a) Data processing and information services
            
that allow data to be generated, acquired, stored, processed, or retrieved and delivered by an electronic transmission to a purchaser when such purchaser's primary purpose for the underlying transaction is the processed data or information;
                (b) Installation or maintenance of wiring or
            
equipment on a customer's premises;
                (c) Tangible personal property;
                (d) Advertising, including but not limited to
            
directory advertising.
                (e) Billing and collection services provided
            
to third parties;
                (f) Internet access service;
                (g) Radio and television audio and video
            
programming services, regardless of the medium, including the furnishing of transmission, conveyance and routing of such services by the programming service provider. Radio and television audio and video programming services shall include but not be limited to cable service as defined in 47 USC 522(6) and audio and video programming services delivered by commercial mobile radio service providers, as defined in 47 CFR 20.3;
                (h) "Ancillary services"; or
                (i) Digital products "delivered
            
electronically", including but not limited to software, music, video, reading materials or ring tones.
            "Vertical service" means an "ancillary service"
        
that is offered in connection with one or more "telecommunications services", which offers advanced calling features that allow customers to identify callers and to manage multiple calls and call connections, including "conference bridging services".
            "Voice mail service" means an "ancillary service"
        
that enables the customer to store, send or receive recorded messages. "Voice mail service" does not include any "vertical services" that the customer may be required to have in order to utilize the "voice mail service".
            (ii) Receipts from the sale of telecommunications
        
service sold on an individual call-by-call basis are in this State if either of the following applies:
                (a) The call both originates and terminates
            
in this State.
                (b) The call either originates or terminates
            
in this State and the service address is located in this State.
            (iii) Receipts from the sale of postpaid
        
telecommunications service at retail are in this State if the origination point of the telecommunication signal, as first identified by the service provider's telecommunication system or as identified by information received by the seller from its service provider if the system used to transport telecommunication signals is not the seller's, is located in this State.
            (iv) Receipts from the sale of prepaid
        
telecommunications service or prepaid mobile telecommunications service at retail are in this State if the purchaser obtains the prepaid card or similar means of conveyance at a location in this State. Receipts from recharging a prepaid telecommunications service or mobile telecommunications service is in this State if the purchaser's billing information indicates a location in this State.
            (v) Receipts from the sale of private
        
communication services are in this State as follows:
                (a) 100% of receipts from charges imposed at
            
each channel termination point in this State.
                (b) 100% of receipts from charges for the
            
total channel mileage between each channel termination point in this State.
                (c) 50% of the total receipts from charges
            
for service segments when those segments are between 2 customer channel termination points, 1 of which is located in this State and the other is located outside of this State, which segments are separately charged.
                (d) The receipts from charges for service
            
segments with a channel termination point located in this State and in two or more other states, and which segments are not separately billed, are in this State based on a percentage determined by dividing the number of customer channel termination points in this State by the total number of customer channel termination points.
            (vi) Receipts from charges for ancillary services
        
for telecommunications service sold to customers at retail are in this State if the customer's primary place of use of telecommunications services associated with those ancillary services is in this State. If the seller of those ancillary services cannot determine where the associated telecommunications are located, then the ancillary services shall be based on the location of the purchaser.
            (vii) Receipts to access a carrier's network or
        
from the sale of telecommunication services or ancillary services for resale are in this State as follows:
                (a) 100% of the receipts from access fees
            
attributable to intrastate telecommunications service that both originates and terminates in this State.
                (b) 50% of the receipts from access fees
            
attributable to interstate telecommunications service if the interstate call either originates or terminates in this State.
                (c) 100% of the receipts from interstate end
            
user access line charges, if the customer's service address is in this State. As used in this subdivision, "interstate end user access line charges" includes, but is not limited to, the surcharge approved by the federal communications commission and levied pursuant to 47 CFR 69.
                (d) Gross receipts from sales of
            
telecommunication services or from ancillary services for telecommunications services sold to other telecommunication service providers for resale shall be sourced to this State using the apportionment concepts used for non-resale receipts of telecommunications services if the information is readily available to make that determination. If the information is not readily available, then the taxpayer may use any other reasonable and consistent method.
        (B-7) For taxable years ending on or after December
    
31, 2008, receipts from the sale of broadcasting services are in this State if the broadcasting services are received in this State. For purposes of this paragraph (B-7), the following terms have the following meanings:
            "Advertising revenue" means consideration
        
received by the taxpayer in exchange for broadcasting services or allowing the broadcasting of commercials or announcements in connection with the broadcasting of film or radio programming, from sponsorships of the programming, or from product placements in the programming.
            "Audience factor" means the ratio that the
        
audience or subscribers located in this State of a station, a network, or a cable system bears to the total audience or total subscribers for that station, network, or cable system. The audience factor for film or radio programming shall be determined by reference to the books and records of the taxpayer or by reference to published rating statistics provided the method used by the taxpayer is consistently used from year to year for this purpose and fairly represents the taxpayer's activity in this State.
            "Broadcast" or "broadcasting" or "broadcasting
        
services" means the transmission or provision of film or radio programming, whether through the public airwaves, by cable, by direct or indirect satellite transmission, or by any other means of communication, either through a station, a network, or a cable system.
            "Film" or "film programming" means the broadcast
        
on television of any and all performances, events, or productions, including but not limited to news, sporting events, plays, stories, or other literary, commercial, educational, or artistic works, either live or through the use of video tape, disc, or any other type of format or medium. Each episode of a series of films produced for television shall constitute separate "film" notwithstanding that the series relates to the same principal subject and is produced during one or more tax periods.
            "Radio" or "radio programming" means the
        
broadcast on radio of any and all performances, events, or productions, including but not limited to news, sporting events, plays, stories, or other literary, commercial, educational, or artistic works, either live or through the use of an audio tape, disc, or any other format or medium. Each episode in a series of radio programming produced for radio broadcast shall constitute a separate "radio programming" notwithstanding that the series relates to the same principal subject and is produced during one or more tax periods.
                (i) In the case of advertising revenue from
            
broadcasting, the customer is the advertiser and the service is received in this State if the commercial domicile of the advertiser is in this State.
                (ii) In the case where film or radio
            
programming is broadcast by a station, a network, or a cable system for a fee or other remuneration received from the recipient of the broadcast, the portion of the service that is received in this State is measured by the portion of the recipients of the broadcast located in this State. Accordingly, the fee or other remuneration for such service that is included in the Illinois numerator of the sales factor is the total of those fees or other remuneration received from recipients in Illinois. For purposes of this paragraph, a taxpayer may determine the location of the recipients of its broadcast using the address of the recipient shown in its contracts with the recipient or using the billing address of the recipient in the taxpayer's records.
                (iii) In the case where film or radio
            
programming is broadcast by a station, a network, or a cable system for a fee or other remuneration from the person providing the programming, the portion of the broadcast service that is received by such station, network, or cable system in this State is measured by the portion of recipients of the broadcast located in this State. Accordingly, the amount of revenue related to such an arrangement that is included in the Illinois numerator of the sales factor is the total fee or other total remuneration from the person providing the programming related to that broadcast multiplied by the Illinois audience factor for that broadcast.
                (iv) In the case where film or radio
            
programming is provided by a taxpayer that is a network or station to a customer for broadcast in exchange for a fee or other remuneration from that customer the broadcasting service is received at the location of the office of the customer from which the services were ordered in the regular course of the customer's trade or business. Accordingly, in such a case the revenue derived by the taxpayer that is included in the taxpayer's Illinois numerator of the sales factor is the revenue from such customers who receive the broadcasting service in Illinois.
                (v) In the case where film or radio
            
programming is provided by a taxpayer that is not a network or station to another person for broadcasting in exchange for a fee or other remuneration from that person, the broadcasting service is received at the location of the office of the customer from which the services were ordered in the regular course of the customer's trade or business. Accordingly, in such a case the revenue derived by the taxpayer that is included in the taxpayer's Illinois numerator of the sales factor is the revenue from such customers who receive the broadcasting service in Illinois.
        (B-8) Gross receipts from winnings under the Illinois
    
Lottery Law from the assignment of a prize under Section 13.1 of the Illinois Lottery Law are received in this State. This paragraph (B-8) applies only to taxable years ending on or after December 31, 2013.
        (C) For taxable years ending before December 31,
    
2008, sales, other than sales governed by paragraphs (B), (B-1), (B-2), and (B-8) are in this State if:
            (i) The income-producing activity is performed in
        
this State; or
            (ii) The income-producing activity is performed
        
both within and without this State and a greater proportion of the income-producing activity is performed within this State than without this State, based on performance costs.
        (C-5) For taxable years ending on or after December
    
31, 2008, sales, other than sales governed by paragraphs (B), (B-1), (B-2), (B-5), and (B-7), are in this State if any of the following criteria are met:
            (i) Sales from the sale or lease of real property
        
are in this State if the property is located in this State.
            (ii) Sales from the lease or rental of tangible
        
personal property are in this State if the property is located in this State during the rental period. Sales from the lease or rental of tangible personal property that is characteristically moving property, including, but not limited to, motor vehicles, rolling stock, aircraft, vessels, or mobile equipment are in this State to the extent that the property is used in this State.
            (iii) In the case of interest, net gains (but not
        
less than zero) and other items of income from intangible personal property, the sale is in this State if:
                (a) in the case of a taxpayer who is a dealer
            
in the item of intangible personal property within the meaning of Section 475 of the Internal Revenue Code, the income or gain is received from a customer in this State. For purposes of this subparagraph, a customer is in this State if the customer is an individual, trust or estate who is a resident of this State and, for all other customers, if the customer's commercial domicile is in this State. Unless the dealer has actual knowledge of the residence or commercial domicile of a customer during a taxable year, the customer shall be deemed to be a customer in this State if the billing address of the customer, as shown in the records of the dealer, is in this State; or
                (b) in all other cases, if the
            
income-producing activity of the taxpayer is performed in this State or, if the income-producing activity of the taxpayer is performed both within and without this State, if a greater proportion of the income-producing activity of the taxpayer is performed within this State than in any other state, based on performance costs.
            (iv) Sales of services are in this State if the
        
services are received in this State. For the purposes of this section, gross receipts from the performance of services provided to a corporation, partnership, or trust may only be attributed to a state where that corporation, partnership, or trust has a fixed place of business. If the state where the services are received is not readily determinable or is a state where the corporation, partnership, or trust receiving the service does not have a fixed place of business, the services shall be deemed to be received at the location of the office of the customer from which the services were ordered in the regular course of the customer's trade or business. If the ordering office cannot be determined, the services shall be deemed to be received at the office of the customer to which the services are billed. If the taxpayer is not taxable in the state in which the services are received, the sale must be excluded from both the numerator and the denominator of the sales factor. The Department shall adopt rules prescribing where specific types of service are received, including, but not limited to, publishing, and utility service.
        (D) For taxable years ending on or after December 31,
    
1995, the following items of income shall not be included in the numerator or denominator of the sales factor: dividends; amounts included under Section 78 of the Internal Revenue Code; and Subpart F income as defined in Section 952 of the Internal Revenue Code. No inference shall be drawn from the enactment of this paragraph (D) in construing this Section for taxable years ending before December 31, 1995.
        (E) Paragraphs (B-1) and (B-2) shall apply to tax
    
years ending on or after December 31, 1999, provided that a taxpayer may elect to apply the provisions of these paragraphs to prior tax years. Such election shall be made in the form and manner prescribed by the Department, shall be irrevocable, and shall apply to all tax years; provided that, if a taxpayer's Illinois income tax liability for any tax year, as assessed under Section 903 prior to January 1, 1999, was computed in a manner contrary to the provisions of paragraphs (B-1) or (B-2), no refund shall be payable to the taxpayer for that tax year to the extent such refund is the result of applying the provisions of paragraph (B-1) or (B-2) retroactively. In the case of a unitary business group, such election shall apply to all members of such group for every tax year such group is in existence, but shall not apply to any taxpayer for any period during which that taxpayer is not a member of such group.
    (b) Insurance companies.
        (1) In general. Except as otherwise provided by
    
paragraph (2), business income of an insurance company for a taxable year shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is the direct premiums written for insurance upon property or risk in this State, and the denominator of which is the direct premiums written for insurance upon property or risk everywhere. For purposes of this subsection, the term "direct premiums written" means the total amount of direct premiums written, assessments and annuity considerations as reported for the taxable year on the annual statement filed by the company with the Illinois Director of Insurance in the form approved by the National Convention of Insurance Commissioners or such other form as may be prescribed in lieu thereof.
        (2) Reinsurance. If the principal source of premiums
    
written by an insurance company consists of premiums for reinsurance accepted by it, the business income of such company shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is the sum of (i) direct premiums written for insurance upon property or risk in this State, plus (ii) premiums written for reinsurance accepted in respect of property or risk in this State, and the denominator of which is the sum of (iii) direct premiums written for insurance upon property or risk everywhere, plus (iv) premiums written for reinsurance accepted in respect of property or risk everywhere. For purposes of this paragraph, premiums written for reinsurance accepted in respect of property or risk in this State, whether or not otherwise determinable, may, at the election of the company, be determined on the basis of the proportion which premiums written for reinsurance accepted from companies commercially domiciled in Illinois bears to premiums written for reinsurance accepted from all sources, or, alternatively, in the proportion which the sum of the direct premiums written for insurance upon property or risk in this State by each ceding company from which reinsurance is accepted bears to the sum of the total direct premiums written by each such ceding company for the taxable year. The election made by a company under this paragraph for its first taxable year ending on or after December 31, 2011, shall be binding for that company for that taxable year and for all subsequent taxable years, and may be altered only with the written permission of the Department, which shall not be unreasonably withheld.
    (c) Financial organizations.
        (1) In general. For taxable years ending before
    
December 31, 2008, business income of a financial organization shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is its business income from sources within this State, and the denominator of which is its business income from all sources. For the purposes of this subsection, the business income of a financial organization from sources within this State is the sum of the amounts referred to in subparagraphs (A) through (E) following, but excluding the adjusted income of an international banking facility as determined in paragraph (2):
            (A) Fees, commissions or other compensation for
        
financial services rendered within this State;
            (B) Gross profits from trading in stocks, bonds
        
or other securities managed within this State;
            (C) Dividends, and interest from Illinois
        
customers, which are received within this State;
            (D) Interest charged to customers at places of
        
business maintained within this State for carrying debit balances of margin accounts, without deduction of any costs incurred in carrying such accounts; and
            (E) Any other gross income resulting from the
        
operation as a financial organization within this State. In computing the amounts referred to in paragraphs (A) through (E) of this subsection, any amount received by a member of an affiliated group (determined under Section 1504(a) of the Internal Revenue Code but without reference to whether any such corporation is an "includible corporation" under Section 1504(b) of the Internal Revenue Code) from another member of such group shall be included only to the extent such amount exceeds expenses of the recipient directly related thereto.
        (2) International Banking Facility. For taxable years
    
ending before December 31, 2008:
            (A) Adjusted Income. The adjusted income of an
        
international banking facility is its income reduced by the amount of the floor amount.
            (B) Floor Amount. The floor amount shall be the
        
amount, if any, determined by multiplying the income of the international banking facility by a fraction, not greater than one, which is determined as follows:
                (i) The numerator shall be:
                The average aggregate, determined on a
            
quarterly basis, of the financial organization's loans to banks in foreign countries, to foreign domiciled borrowers (except where secured primarily by real estate) and to foreign governments and other foreign official institutions, as reported for its branches, agencies and offices within the state on its "Consolidated Report of Condition", Schedule A, Lines 2.c., 5.b., and 7.a., which was filed with the Federal Deposit Insurance Corporation and other regulatory authorities, for the year 1980, minus
                The average aggregate, determined on a
            
quarterly basis, of such loans (other than loans of an international banking facility), as reported by the financial institution for its branches, agencies and offices within the state, on the corresponding Schedule and lines of the Consolidated Report of Condition for the current taxable year, provided, however, that in no case shall the amount determined in this clause (the subtrahend) exceed the amount determined in the preceding clause (the minuend); and
                (ii) the denominator shall be the average
            
aggregate, determined on a quarterly basis, of the international banking facility's loans to banks in foreign countries, to foreign domiciled borrowers (except where secured primarily by real estate) and to foreign governments and other foreign official institutions, which were recorded in its financial accounts for the current taxable year.
            (C) Change to Consolidated Report of Condition
        
and in Qualification. In the event the Consolidated Report of Condition which is filed with the Federal Deposit Insurance Corporation and other regulatory authorities is altered so that the information required for determining the floor amount is not found on Schedule A, lines 2.c., 5.b. and 7.a., the financial institution shall notify the Department and the Department may, by regulations or otherwise, prescribe or authorize the use of an alternative source for such information. The financial institution shall also notify the Department should its international banking facility fail to qualify as such, in whole or in part, or should there be any amendment or change to the Consolidated Report of Condition, as originally filed, to the extent such amendment or change alters the information used in determining the floor amount.
        (3) For taxable years ending on or after December 31,
    
2008, the business income of a financial organization shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is its gross receipts from sources in this State or otherwise attributable to this State's marketplace and the denominator of which is its gross receipts everywhere during the taxable year. "Gross receipts" for purposes of this subparagraph (3) means gross income, including net taxable gain on disposition of assets, including securities and money market instruments, when derived from transactions and activities in the regular course of the financial organization's trade or business. The following examples are illustrative:
            (i) Receipts from the lease or rental of real or
        
tangible personal property are in this State if the property is located in this State during the rental period. Receipts from the lease or rental of tangible personal property that is characteristically moving property, including, but not limited to, motor vehicles, rolling stock, aircraft, vessels, or mobile equipment are from sources in this State to the extent that the property is used in this State.
            (ii) Interest income, commissions, fees, gains on
        
disposition, and other receipts from assets in the nature of loans that are secured primarily by real estate or tangible personal property are from sources in this State if the security is located in this State.
            (iii) Interest income, commissions, fees, gains
        
on disposition, and other receipts from consumer loans that are not secured by real or tangible personal property are from sources in this State if the debtor is a resident of this State.
            (iv) Interest income, commissions, fees, gains on
        
disposition, and other receipts from commercial loans and installment obligations that are not secured by real or tangible personal property are from sources in this State if the proceeds of the loan are to be applied in this State. If it cannot be determined where the funds are to be applied, the income and receipts are from sources in this State if the office of the borrower from which the loan was negotiated in the regular course of business is located in this State. If the location of this office cannot be determined, the income and receipts shall be excluded from the numerator and denominator of the sales factor.
            (v) Interest income, fees, gains on disposition,
        
service charges, merchant discount income, and other receipts from credit card receivables are from sources in this State if the card charges are regularly billed to a customer in this State.
            (vi) Receipts from the performance of services,
        
including, but not limited to, fiduciary, advisory, and brokerage services, are in this State if the services are received in this State within the meaning of subparagraph (a)(3)(C-5)(iv) of this Section.
            (vii) Receipts from the issuance of travelers
        
checks and money orders are from sources in this State if the checks and money orders are issued from a location within this State.
            (viii) Receipts from investment assets and
        
activities and trading assets and activities are included in the receipts factor as follows:
                (1) Interest, dividends, net gains (but not
            
less than zero) and other income from investment assets and activities from trading assets and activities shall be included in the receipts factor. Investment assets and activities and trading assets and activities include but are not limited to: investment securities; trading account assets; federal funds; securities purchased and sold under agreements to resell or repurchase; options; futures contracts; forward contracts; notional principal contracts such as swaps; equities; and foreign currency transactions. With respect to the investment and trading assets and activities described in subparagraphs (A) and (B) of this paragraph, the receipts factor shall include the amounts described in such subparagraphs.
                    (A) The receipts factor shall include the
                
amount by which interest from federal funds sold and securities purchased under resale agreements exceeds interest expense on federal funds purchased and securities sold under repurchase agreements.
                    (B) The receipts factor shall include the
                
amount by which interest, dividends, gains and other income from trading assets and activities, including but not limited to assets and activities in the matched book, in the arbitrage book, and foreign currency transactions, exceed amounts paid in lieu of interest, amounts paid in lieu of dividends, and losses from such assets and activities.
                (2) The numerator of the receipts factor
            
includes interest, dividends, net gains (but not less than zero), and other income from investment assets and activities and from trading assets and activities described in paragraph (1) of this subsection that are attributable to this State.
                    (A) The amount of interest, dividends,
                
net gains (but not less than zero), and other income from investment assets and activities in the investment account to be attributed to this State and included in the numerator is determined by multiplying all such income from such assets and activities by a fraction, the numerator of which is the gross income from such assets and activities which are properly assigned to a fixed place of business of the taxpayer within this State and the denominator of which is the gross income from all such assets and activities.
                    (B) The amount of interest from federal
                
funds sold and purchased and from securities purchased under resale agreements and securities sold under repurchase agreements attributable to this State and included in the numerator is determined by multiplying the amount described in subparagraph (A) of paragraph (1) of this subsection from such funds and such securities by a fraction, the numerator of which is the gross income from such funds and such securities which are properly assigned to a fixed place of business of the taxpayer within this State and the denominator of which is the gross income from all such funds and such securities.
                    (C) The amount of interest, dividends,
                
gains, and other income from trading assets and activities, including but not limited to assets and activities in the matched book, in the arbitrage book and foreign currency transactions (but excluding amounts described in subparagraphs (A) or (B) of this paragraph), attributable to this State and included in the numerator is determined by multiplying the amount described in subparagraph (B) of paragraph (1) of this subsection by a fraction, the numerator of which is the gross income from such trading assets and activities which are properly assigned to a fixed place of business of the taxpayer within this State and the denominator of which is the gross income from all such assets and activities.
                    (D) Properly assigned, for purposes of
                
this paragraph (2) of this subsection, means the investment or trading asset or activity is assigned to the fixed place of business with which it has a preponderance of substantive contacts. An investment or trading asset or activity assigned by the taxpayer to a fixed place of business without the State shall be presumed to have been properly assigned if:
                        (i) the taxpayer has assigned, in the
                    
regular course of its business, such asset or activity on its records to a fixed place of business consistent with federal or state regulatory requirements;
                        (ii) such assignment on its records
                    
is based upon substantive contacts of the asset or activity to such fixed place of business; and
                        (iii) the taxpayer uses such records
                    
reflecting assignment of such assets or activities for the filing of all state and local tax returns for which an assignment of such assets or activities to a fixed place of business is required.
                    (E) The presumption of proper assignment
                
of an investment or trading asset or activity provided in subparagraph (D) of paragraph (2) of this subsection may be rebutted upon a showing by the Department, supported by a preponderance of the evidence, that the preponderance of substantive contacts regarding such asset or activity did not occur at the fixed place of business to which it was assigned on the taxpayer's records. If the fixed place of business that has a preponderance of substantive contacts cannot be determined for an investment or trading asset or activity to which the presumption in subparagraph (D) of paragraph (2) of this subsection does not apply or with respect to which that presumption has been rebutted, that asset or activity is properly assigned to the state in which the taxpayer's commercial domicile is located. For purposes of this subparagraph (E), it shall be presumed, subject to rebuttal, that taxpayer's commercial domicile is in the state of the United States or the District of Columbia to which the greatest number of employees are regularly connected with the management of the investment or trading income or out of which they are working, irrespective of where the services of such employees are performed, as of the last day of the taxable year.
        (4) (Blank).
        (5) (Blank).
    (c-1) Federally regulated exchanges. For taxable years ending on or after December 31, 2012, business income of a federally regulated exchange shall, at the option of the federally regulated exchange, be apportioned to this State by multiplying such income by a fraction, the numerator of which is its business income from sources within this State, and the denominator of which is its business income from all sources. For purposes of this subsection, the business income within this State of a federally regulated exchange is the sum of the following:
        (1) Receipts attributable to transactions executed
    
on a physical trading floor if that physical trading floor is located in this State.
        (2) Receipts attributable to all other matching,
    
execution, or clearing transactions, including without limitation receipts from the provision of matching, execution, or clearing services to another entity, multiplied by (i) for taxable years ending on or after December 31, 2012 but before December 31, 2013, 63.77%; and (ii) for taxable years ending on or after December 31, 2013, 27.54%.
        (3) All other receipts not governed by subparagraphs
    
(1) or (2) of this subsection (c-1), to the extent the receipts would be characterized as "sales in this State" under item (3) of subsection (a) of this Section.
    "Federally regulated exchange" means (i) a "registered entity" within the meaning of 7 U.S.C. Section 1a(40)(A), (B), or (C), (ii) an "exchange" or "clearing agency" within the meaning of 15 U.S.C. Section 78c (a)(1) or (23), (iii) any such entities regulated under any successor regulatory structure to the foregoing, and (iv) all taxpayers who are members of the same unitary business group as a federally regulated exchange, determined without regard to the prohibition in Section 1501(a)(27) of this Act against including in a unitary business group taxpayers who are ordinarily required to apportion business income under different subsections of this Section; provided that this subparagraph (iv) shall apply only if 50% or more of the business receipts of the unitary business group determined by application of this subparagraph (iv) for the taxable year are attributable to the matching, execution, or clearing of transactions conducted by an entity described in subparagraph (i), (ii), or (iii) of this paragraph.
    In no event shall the Illinois apportionment percentage computed in accordance with this subsection (c-1) for any taxpayer for any tax year be less than the Illinois apportionment percentage computed under this subsection (c-1) for that taxpayer for the first full tax year ending on or after December 31, 2013 for which this subsection (c-1) applied to the taxpayer.
    (d) Transportation services. For taxable years ending before December 31, 2008, business income derived from furnishing transportation services shall be apportioned to this State in accordance with paragraphs (1) and (2):
        (1) Such business income (other than that derived
    
from transportation by pipeline) shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is the revenue miles of the person in this State, and the denominator of which is the revenue miles of the person everywhere. For purposes of this paragraph, a revenue mile is the transportation of 1 passenger or 1 net ton of freight the distance of 1 mile for a consideration. Where a person is engaged in the transportation of both passengers and freight, the fraction above referred to shall be determined by means of an average of the passenger revenue mile fraction and the freight revenue mile fraction, weighted to reflect the person's
            (A) relative railway operating income from total
        
passenger and total freight service, as reported to the Interstate Commerce Commission, in the case of transportation by railroad, and
            (B) relative gross receipts from passenger and
        
freight transportation, in case of transportation other than by railroad.
        (2) Such business income derived from transportation
    
by pipeline shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is the revenue miles of the person in this State, and the denominator of which is the revenue miles of the person everywhere. For the purposes of this paragraph, a revenue mile is the transportation by pipeline of 1 barrel of oil, 1,000 cubic feet of gas, or of any specified quantity of any other substance, the distance of 1 mile for a consideration.
        (3) For taxable years ending on or after December 31,
    
2008, business income derived from providing transportation services other than airline services shall be apportioned to this State by using a fraction, (a) the numerator of which shall be (i) all receipts from any movement or shipment of people, goods, mail, oil, gas, or any other substance (other than by airline) that both originates and terminates in this State, plus (ii) that portion of the person's gross receipts from movements or shipments of people, goods, mail, oil, gas, or any other substance (other than by airline) that originates in one state or jurisdiction and terminates in another state or jurisdiction, that is determined by the ratio that the miles traveled in this State bears to total miles everywhere and (b) the denominator of which shall be all revenue derived from the movement or shipment of people, goods, mail, oil, gas, or any other substance (other than by airline). Where a taxpayer is engaged in the transportation of both passengers and freight, the fraction above referred to shall first be determined separately for passenger miles and freight miles. Then an average of the passenger miles fraction and the freight miles fraction shall be weighted to reflect the taxpayer's:
            (A) relative railway operating income from total
        
passenger and total freight service, as reported to the Surface Transportation Board, in the case of transportation by railroad; and
            (B) relative gross receipts from passenger and
        
freight transportation, in case of transportation other than by railroad.
        (4) For taxable years ending on or after December 31,
    
2008, business income derived from furnishing airline transportation services shall be apportioned to this State by multiplying such income by a fraction, the numerator of which is the revenue miles of the person in this State, and the denominator of which is the revenue miles of the person everywhere. For purposes of this paragraph, a revenue mile is the transportation of one passenger or one net ton of freight the distance of one mile for a consideration. If a person is engaged in the transportation of both passengers and freight, the fraction above referred to shall be determined by means of an average of the passenger revenue mile fraction and the freight revenue mile fraction, weighted to reflect the person's relative gross receipts from passenger and freight airline transportation.
    (e) Combined apportionment. Where 2 or more persons are engaged in a unitary business as described in subsection (a)(27) of Section 1501, a part of which is conducted in this State by one or more members of the group, the business income attributable to this State by any such member or members shall be apportioned by means of the combined apportionment method.
    (f) Alternative allocation. If the allocation and apportionment provisions of subsections (a) through (e) and of subsection (h) do not, for taxable years ending before December 31, 2008, fairly represent the extent of a person's business activity in this State, or, for taxable years ending on or after December 31, 2008, fairly represent the market for the person's goods, services, or other sources of business income, the person may petition for, or the Director may, without a petition, permit or require, in respect of all or any part of the person's business activity, if reasonable:
        (1) Separate accounting;
        (2) The exclusion of any one or more factors;
        (3) The inclusion of one or more additional factors
    
which will fairly represent the person's business activities or market in this State; or
        (4) The employment of any other method to effectuate
    
an equitable allocation and apportionment of the person's business income.
    (g) Cross reference. For allocation of business income by residents, see Section 301(a).
    (h) For tax years ending on or after December 31, 1998, the apportionment factor of persons who apportion their business income to this State under subsection (a) shall be equal to:
        (1) for tax years ending on or after December 31,
    
1998 and before December 31, 1999, 16 2/3% of the property factor plus 16 2/3% of the payroll factor plus 66 2/3% of the sales factor;
        (2) for tax years ending on or after December 31,
    
1999 and before December 31, 2000, 8 1/3% of the property factor plus 8 1/3% of the payroll factor plus 83 1/3% of the sales factor;
        (3) for tax years ending on or after December 31,
    
2000, the sales factor.
If, in any tax year ending on or after December 31, 1998 and before December 31, 2000, the denominator of the payroll, property, or sales factor is zero, the apportionment factor computed in paragraph (1) or (2) of this subsection for that year shall be divided by an amount equal to 100% minus the percentage weight given to each factor whose denominator is equal to zero.
(Source: P.A. 98-478, eff. 1-1-14; 98-496, eff. 1-1-14; 98-756, eff. 7-16-14; 99-642, eff. 7-28-16.)

35 ILCS 5/305

    (35 ILCS 5/305) (from Ch. 120, par. 3-305)
    Sec. 305. Allocation of Partnership Income by partnerships and partners other than residents.
    (a) Allocation of partnership business income by partners other than residents. The respective shares of partners other than residents in so much of the business income of the partnership as is allocated or apportioned to this State in the possession of the partnership shall be taken into account by such partners pro rata in accordance with their respective distributive shares of such partnership income for the partnership's taxable year and allocated to this State.
    (b) Allocation of partnership nonbusiness income by partners other than residents. The respective shares of partners other than residents in the items of partnership income and deduction not taken into account in computing the business income of a partnership shall be taken into account by such partners pro rata in accordance with their respective distributive shares of such partnership income for the partnership's taxable year, and allocated as if such items had been paid, incurred or accrued directly to such partners in their separate capacities.
    (c) Allocation or apportionment of base income by partnership. Base income of a partnership shall be allocated or apportioned to this State pursuant to Article 3, in the same manner as it is allocated or apportioned for any other nonresident.
    (c-5) Taxable income of an investment partnership, as defined in Section 1501(a)(11.5) of this Act, that is distributable to a nonresident partner shall be treated as nonbusiness income and shall be allocated to the partner's state of residence (in the case of an individual) or commercial domicile (in the case of any other person). However, any income distributable to a nonresident partner shall be treated as business income and apportioned as if such income had been received directly by the partner if the partner has made an election under Section 1501(a)(1) of this Act to treat all income as business income or if such income is from investment activity:
        (1) that is directly or integrally related to any
    
other business activity conducted in this State by the nonresident partner (or any member of that partner's unitary business group);
        (2) that serves an operational function to any other
    
business activity of the nonresident partner (or any member of that partner's unitary business group) in this State; or
        (3) where assets of the investment partnership were
    
acquired with working capital from a trade or business activity conducted in this State in which the nonresident partner (or any member of that partner's unitary business group) owns an interest.
    (d) Cross reference. For allocation of partnership income or deductions by residents, see Section 301(a).
(Source: P.A. 93-840, eff. 7-30-04.)

35 ILCS 5/306

    (35 ILCS 5/306) (from Ch. 120, par. 3-306)
    Sec. 306. Allocation or apportionment of income by estates and trusts.
    The items of income and deduction taken into account by an estate or trust in computing its base income for a taxable year shall be allocated or apportioned to this State to the extent provided by Sections 301 through 304 and, to the extent properly paid, credited or required to be distributed to beneficiaries for such taxable year, shall be deemed to have been so paid, credited or distributed pro rata.
(Source: P.A. 76-2402.)

35 ILCS 5/307

    (35 ILCS 5/307) (from Ch. 120, par. 3-307)
    Sec. 307. Allocation of income by estate or trust beneficiaries other than residents. (a) Allocation of business income by beneficiaries other than residents. To the extent the business income of an estate or trust allocated or apportioned to this State in the possession of the estate or trust is deemed to have been paid, credited or distributed by the estate or trust under Section 306, the respective shares of beneficiaries of the estate or trust, other than residents, in such business income shall be taken into account by such beneficiaries in proportion to their respective shares of the distributable net income of the estate or trust for its taxable year and allocated to this State.
    (b) Allocation of nonbusiness income by beneficiaries other than residents. To the extent items of estate or trust income and deduction not taken into account in computing the business income of an estate or trust are deemed to have been paid, credited or distributed by the estate or trust under Section 306, the respective shares of beneficiaries of the estate or trust, other than residents, in such items shall be taken into account by such beneficiaries in proportion to their respective shares of the distributable net income of the estate or trust for its taxable year, and allocated as if such items had been paid, incurred or accrued directly to such beneficiaries in their separate capacities.
    (c) Accumulation and capital gain distributions. In the event that, in any taxable year of a trust, the trust makes an accumulation distribution or a capital gain distribution (both as defined in Section 665 of the Internal Revenue Code), the total of the amounts which are included in the income of each beneficiary of such trust, other than a resident, under Sections 668 and 669 of the Internal Revenue Code shall be allocated to this State to the extent that the items of income included in such distribution were allocated or apportioned to this State in the hands of the trust.
    (d) Cross references. (1) For allocation of amounts received by nonresidents from certain employee trusts, see Section 301 (b) (2).
    (2) For allocation of estate or trust income or deductions by residents, see Section 301 (a).
(Source: P.A. 84-550.)

35 ILCS 5/308

    (35 ILCS 5/308) (from Ch. 120, par. 3-308)
    Sec. 308. Allocation of Subchapter S Corporation Income by Subchapter S Corporations and Shareholders Other Than Residents. (a) Allocation of Subchapter S corporation business income by shareholders other than residents. The respective shares of shareholders other than residents in so much of the business income of the Subchapter S corporation as is allocated or apportioned to this State in the hands of the Subchapter S corporation shall be taken into account by such shareholder pro rata in accordance with the requirements of Section 1366 of the Internal Revenue Code for the Subchapter S corporation's taxable year and allocated to this State.
    (b) Allocation of Subchapter S corporation nonbusiness income by shareholders other than residents. The respective share of shareholders other than residents in the items of Subchapter S corporation income and deduction not taken into account in computing the business income of the Subchapter S corporation shall be taken into account by such shareholders pro rata in accordance with the requirements of Section 1366 of the Internal Revenue Code for the corporation's taxable year, and allocated as if such items had been paid, incurred or accrued directly to such shareholders in their separate capacities.
    (c) Allocation or apportionment of base income by the Subchapter S corporation. Base income of a Subchapter S corporation shall be allocated or apportioned to this State pursuant to this Article 3 in the same manner as it is allocated or apportioned for any other nonresident.
    (d) This Section shall not apply to any corporation for which there is in effect a federal election to opt out of the provisions of the Subchapter S Revision Act of 1982 and have applied instead the prior federal Subchapter S rules as in effect on July 1, 1982.
(Source: P.A. 83-1352.)

35 ILCS 5/Art. 4

 
    (35 ILCS 5/Art. 4 heading)
ARTICLE 4. ACCOUNTING.

35 ILCS 5/401

    (35 ILCS 5/401) (from Ch. 120, par. 4-401)
    Sec. 401. Taxable Year.
    (a) In general. For purposes of the tax imposed by this Act, the taxable year of a person shall be the same as the taxable year of such person for federal income tax purposes. The taxable year of any person required to file a return under this Act but not under the Internal Revenue Code shall be his annual accounting period if it is a fiscal or calendar year, and in all other cases shall be the calendar year.
    (b) Change in taxable year. If the taxable year of a person is changed for federal income tax purposes, the taxable year of such person for purposes of the tax imposed by this Act shall be similarly changed. In the case of a taxable year for a period of less than 12 months, the standard exemption allowed under section 204 shall be prorated on the basis of the number of days in such year to 365.
    (c) Termination of taxable year for jeopardy. Notwithstanding the provisions of subsections (a) and (b), if the Department terminates the taxable year of a taxpayer under section 1102 (relating to tax in jeopardy), the tax shall be computed for the period determined by such action.
(Source: P.A. 76-261.)

35 ILCS 5/402

    (35 ILCS 5/402) (from Ch. 120, par. 4-402)
    Sec. 402. Methods of Accounting.
    (a) Same as federal. For purposes of the tax imposed by this Act, a person's method of accounting shall be the same as such person's method of accounting for federal income tax purposes. If no method of accounting has been regularly used by such person, base and net income for purposes of this Act shall be computed under such method as in the opinion of the Department fairly reflects income.
    (b) Change of accounting method. If a person's method of accounting is changed for federal income tax purposes, for purposes of this Act it shall be similarly changed.
(Source: P.A. 76-261.)

35 ILCS 5/403

    (35 ILCS 5/403) (from Ch. 120, par. 4-403)
    Sec. 403. Effect of Determination for Federal Purposes. (a) Reporting. To the extent not inconsistent with the provisions of this Act or forms or regulations prescribed by the Department, each person making a return under this Act shall take into account the items of income, deduction and exclusion on such return in the same manner and amounts as reflected in such person's federal income tax return for the same taxable year.
    (b) Adjustment. A final determination pursuant to the Internal Revenue Code adjusting any item or items of income, deduction or exclusion for any taxable year shall be correct for purposes of this Act to the extent such item or items enter into the determination of base income.
    (c) Identification of differences. To the extent required by forms or regulations prescribed by the Department, any person making a return under this Act may be required to indicate the item or items of income, deduction and exclusion which would enter into the determination of base income if this Act were amended to incorporate the Internal Revenue Code as amended and in effect for such taxable year.
(Source: P.A. 81-1405.)

35 ILCS 5/404

    (35 ILCS 5/404) (from Ch. 120, par. 4-404)
    Sec. 404. Reallocation of Items.
    (a) If it appears to the Director that any agreement, understanding or arrangement exists between any persons which causes any person's base income allocable to this State to be improperly or inaccurately reflected, the Director may adjust such items of income and deduction, and any factor taken into account in allocating income to this State, to such extent as may reasonably be required to determine the base income of such person properly allocable to this State.
    (b) The Director may not make an adjustment to base income under this Section that has the same effect as retroactively applying any amendments to this Act made by Public Act 93-0840, Public Act 95-0233, or Public Act 95-0707.
(Source: P.A. 95-948, eff. 8-29-08.)

35 ILCS 5/405

    (35 ILCS 5/405)
    Sec. 405. Carryovers in certain acquisitions.
    (a) In the case of the acquisition of assets of a corporation by another corporation described in Section 381(a) of the Internal Revenue Code, the acquiring corporation shall succeed to and take into account, as of the close of the day of distribution or transfer, all Article 2 credits and net losses under Section 207 of the corporation from which the assets were acquired.
    (b) In the case of the acquisition of assets of a partnership by another partnership in a transaction in which the acquiring partnership is considered to be a continuation of the partnership from which the assets were acquired under the provisions of Section 708 of the Internal Revenue Code and any regulations promulgated under that Section, the acquiring partnership shall succeed to and take into account, as of the close of the day of distribution or transfer, all Article 2 credits and net losses under Section 207 of the partnership from which the assets were acquired.
    (b-5) No limitation under Section 382 of the Internal Revenue Code or the separate return limitation year regulations promulgated under Section 1502 of the Internal Revenue Code shall apply to the carryover of any Article 2 credit or net loss allowable under Section 207.
    (c) The provisions of this amendatory Act of the 91st General Assembly shall apply to all acquisitions occurring in taxable years ending on or after December 31, 1986; provided that if a taxpayer's Illinois income tax liability for any taxable year, as assessed under Section 903 prior to January 1, 1999, was computed without taking into account all of the Article 2 credits and net losses under Section 207 as allowed by this Section:
        (1) no refund shall be payable to the taxpayer for
    
that taxable year as the result of allowing any portion of the Article 2 credits or net losses under Section 207 that were not taken into account in computing the tax assessed prior to January 1, 1999;
        (2) any deficiency which has not been paid may be
    
reduced (but not below zero) by the allowance of some or all of the Article 2 credits or net losses under Section 207 that were not taken into account in computing the tax assessed prior to January 1, 1999; and
        (3) in the case of any Article 2 credit or net loss
    
under Section 207 that, pursuant to this subsection (c), could not be taken into account either in computing the tax assessed prior to January 1, 1999 for a taxable year or in reducing a deficiency for that taxable year under paragraph (2) of subsection (c), the allowance of such credit or loss in any other taxable year shall not be denied on the grounds that such credit or loss should properly have been claimed in that taxable year under subsection (a) or (b).
(Source: P.A. 91-541, eff. 8-13-99; 91-913, eff. 1-1-01.)

35 ILCS 5/Art. 5

 
    (35 ILCS 5/Art. 5 heading)
ARTICLE 5. RECORDS, RETURNS AND NOTICES.

35 ILCS 5/501

    (35 ILCS 5/501) (from Ch. 120, par. 5-501)
    Sec. 501. Notice or Regulations Requiring Records, Statements and Special Returns.
    (a) In general. Every person liable for any tax imposed by this Act shall keep such records, render such statements, make such returns and notices, and comply with such rules and regulations as the Department may from time to time prescribe. Whenever in the judgment of the Director it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns and notices, render such statements, or keep such records, as the Director deems sufficient to show whether or not such person is liable for tax under this Act.
    (b) Reportable transactions. For each taxable year in which a taxpayer is required to make a disclosure statement under Treasury Regulations Section 1.6011-4 (26 CFR 1.6011-4) (including any taxpayer that is a member of a consolidated group required to make such disclosure) with respect to a reportable transaction (including a listed transaction) in which the taxpayer participated in a taxable year for which a return is required under Section 502 of this Act, such taxpayer shall file a copy of such disclosure with the Department. Disclosure under this subsection is required to be made by any taxpayer that is a member of a unitary business group that includes any person required to make a disclosure statement under Treasury Regulations Section 1.6011-4. Disclosure under this subsection is required with respect to any transaction entered into after February 28, 2000 that becomes a listed transaction at any time, and shall be made in the manner prescribed by the Department. With respect to transactions in which the taxpayer participated for taxable years ending before December 31, 2004, disclosure shall be made by the due date (including extensions) of the first return required under Section 502 of this Act due after the effective date of this amendatory Act of the 93rd General Assembly. With respect to transactions in which the taxpayer participated for taxable years ending on and after December 31, 2004, disclosure shall be made in the time and manner prescribed in Treasury Regulations Section 1.6011-4(e). Notwithstanding the above, no disclosure is required for transactions entered into after February 28, 2000 and before January 1, 2005 (i) if the taxpayer has filed an amended Illinois income tax return which reverses the tax benefits of the potential tax avoidance transaction, or (ii) as a result of a federal audit the Internal Revenue Service has determined the tax treatment of the transaction and an Illinois amended return has been filed to reflect the federal treatment.
(Source: P.A. 93-840, eff. 7-30-04.)

35 ILCS 5/502

    (35 ILCS 5/502) (from Ch. 120, par. 5-502)
    Sec. 502. Returns and notices.
    (a) In general. A return with respect to the taxes imposed by this Act shall be made by every person for any taxable year:
        (1) for which such person is liable for a tax imposed
    
by this Act, or
        (2) in the case of a resident or in the case of a
    
corporation which is qualified to do business in this State, for which such person is required to make a federal income tax return, regardless of whether such person is liable for a tax imposed by this Act. However, this paragraph shall not require a resident to make a return if such person has an Illinois base income of the basic amount in Section 204(b) or less and is either claimed as a dependent on another person's tax return under the Internal Revenue Code, or is claimed as a dependent on another person's tax return under this Act.
    Notwithstanding the provisions of paragraph (1), a nonresident (other than, for taxable years ending on or after December 31, 2011, a nonresident required to withhold tax under Section 709.5) whose Illinois income tax liability under subsections (a), (b), (c), and (d) of Section 201 of this Act is paid in full after taking into account the credits allowed under subsection (f) of this Section or allowed under Section 709.5 of this Act shall not be required to file a return under this subsection (a).
    (b) Fiduciaries and receivers.
        (1) Decedents. If an individual is deceased, any
    
return or notice required of such individual under this Act shall be made by his executor, administrator, or other person charged with the property of such decedent.
        (2) Individuals under a disability. If an individual
    
is unable to make a return or notice required under this Act, the return or notice required of such individual shall be made by his duly authorized agent, guardian, fiduciary or other person charged with the care of the person or property of such individual.
        (3) Estates and trusts. Returns or notices required
    
of an estate or a trust shall be made by the fiduciary thereof.
        (4) Receivers, trustees and assignees for
    
corporations. In a case where a receiver, trustee in bankruptcy, or assignee, by order of a court of competent jurisdiction, by operation of law, or otherwise, has possession of or holds title to all or substantially all the property or business of a corporation, whether or not such property or business is being operated, such receiver, trustee, or assignee shall make the returns and notices required of such corporation in the same manner and form as corporations are required to make such returns and notices.
    (c) Joint returns by husband and wife.
        (1) Except as provided in paragraph (3):
            (A) if a husband and wife file a joint federal
        
income tax return for a taxable year ending before December 31, 2009, they shall file a joint return under this Act for such taxable year and their liabilities shall be joint and several;
            (B) if a husband and wife file a joint federal
        
income tax return for a taxable year ending on or after December 31, 2009, they may elect to file separate returns under this Act for such taxable year. The election under this paragraph must be made on or before the due date (including extensions) of the return and, once made, shall be irrevocable. If no election is timely made under this paragraph for a taxable year:
                (i) the couple must file a joint return under
            
this Act for such taxable year,
                (ii) their liabilities shall be joint and
            
several, and
                (iii) any overpayment for that taxable year
            
may be withheld under Section 909 of this Act or under Section 2505-275 of the Civil Administrative Code of Illinois and applied against a debt of either spouse without regard to the amount of the overpayment attributable to the other spouse; and
            (C) if the federal income tax liability of either
        
spouse is determined on a separate federal income tax return, they shall file separate returns under this Act.
        (2) If neither spouse is required to file a federal
    
income tax return and either or both are required to file a return under this Act, they may elect to file separate or joint returns and pursuant to such election their liabilities shall be separate or joint and several.
        (3) If either husband or wife is a resident and the
    
other is a nonresident, they shall file separate returns in this State on such forms as may be required by the Department in which event their tax liabilities shall be separate; but if they file a joint federal income tax return for a taxable year, they may elect to determine their joint net income and file a joint return for that taxable year under the provisions of paragraph (1) of this subsection as if both were residents and in such case, their liabilities shall be joint and several.
        (4) Innocent spouses.
            (A) However, for tax liabilities arising and paid
        
prior to August 13, 1999, an innocent spouse shall be relieved of liability for tax (including interest and penalties) for any taxable year for which a joint return has been made, upon submission of proof that the Internal Revenue Service has made a determination under Section 6013(e) of the Internal Revenue Code, for the same taxable year, which determination relieved the spouse from liability for federal income taxes. If there is no federal income tax liability at issue for the same taxable year, the Department shall rely on the provisions of Section 6013(e) to determine whether the person requesting innocent spouse abatement of tax, penalty, and interest is entitled to that relief.
            (B) For tax liabilities arising on and after
        
August 13, 1999 or which arose prior to that date, but remain unpaid as of that date, if an individual who filed a joint return for any taxable year has made an election under this paragraph, the individual's liability for any tax shown on the joint return shall not exceed the individual's separate return amount and the individual's liability for any deficiency assessed for that taxable year shall not exceed the portion of the deficiency properly allocable to the individual. For purposes of this paragraph:
                (i) An election properly made pursuant to
            
Section 6015 of the Internal Revenue Code shall constitute an election under this paragraph, provided that the election shall not be effective until the individual has notified the Department of the election in the form and manner prescribed by the Department.
                (ii) If no election has been made under
            
Section 6015, the individual may make an election under this paragraph in the form and manner prescribed by the Department, provided that no election may be made if the Department finds that assets were transferred between individuals filing a joint return as part of a scheme by such individuals to avoid payment of Illinois income tax and the election shall not eliminate the individual's liability for any portion of a deficiency attributable to an error on the return of which the individual had actual knowledge as of the date of filing.
                (iii) In determining the separate return
            
amount or portion of any deficiency attributable to an individual, the Department shall follow the provisions in subsections (c) and (d) of Section 6015 of the Internal Revenue Code.
                (iv) In determining the validity of an
            
individual's election under subparagraph (ii) and in determining an electing individual's separate return amount or portion of any deficiency under subparagraph (iii), any determination made by the Secretary of the Treasury, by the United States Tax Court on petition for review of a determination by the Secretary of the Treasury, or on appeal from the United States Tax Court under Section 6015 of the Internal Revenue Code regarding criteria for eligibility or under subsection (d) of Section 6015 of the Internal Revenue Code regarding the allocation of any item of income, deduction, payment, or credit between an individual making the federal election and that individual's spouse shall be conclusively presumed to be correct. With respect to any item that is not the subject of a determination by the Secretary of the Treasury or the federal courts, in any proceeding involving this subsection, the individual making the election shall have the burden of proof with respect to any item except that the Department shall have the burden of proof with respect to items in subdivision (ii).
                (v) Any election made by an individual under
            
this subsection shall apply to all years for which that individual and the spouse named in the election have filed a joint return.
                (vi) After receiving a notice that the
            
federal election has been made or after receiving an election under subdivision (ii), the Department shall take no collection action against the electing individual for any liability arising from a joint return covered by the election until the Department has notified the electing individual in writing that the election is invalid or of the portion of the liability the Department has allocated to the electing individual. Within 60 days (150 days if the individual is outside the United States) after the issuance of such notification, the individual may file a written protest of the denial of the election or of the Department's determination of the liability allocated to him or her and shall be granted a hearing within the Department under the provisions of Section 908. If a protest is filed, the Department shall take no collection action against the electing individual until the decision regarding the protest has become final under subsection (d) of Section 908 or, if administrative review of the Department's decision is requested under Section 1201, until the decision of the court becomes final.
    (d) Partnerships. Every partnership having any base income allocable to this State in accordance with section 305(c) shall retain information concerning all items of income, gain, loss and deduction; the names and addresses of all of the partners, or names and addresses of members of a limited liability company, or other persons who would be entitled to share in the base income of the partnership if distributed; the amount of the distributive share of each; and such other pertinent information as the Department may by forms or regulations prescribe. The partnership shall make that information available to the Department when requested by the Department.
    (e) For taxable years ending on or after December 31, 1985, and before December 31, 1993, taxpayers that are corporations (other than Subchapter S corporations) having the same taxable year and that are members of the same unitary business group may elect to be treated as one taxpayer for purposes of any original return, amended return which includes the same taxpayers of the unitary group which joined in the election to file the original return, extension, claim for refund, assessment, collection and payment and determination of the group's tax liability under this Act. This subsection (e) does not permit the election to be made for some, but not all, of the purposes enumerated above. For taxable years ending on or after December 31, 1987, corporate members (other than Subchapter S corporations) of the same unitary business group making this subsection (e) election are not required to have the same taxable year.
    For taxable years ending on or after December 31, 1993, taxpayers that are corporations (other than Subchapter S corporations) and that are members of the same unitary business group shall be treated as one taxpayer for purposes of any original return, amended return which includes the same taxpayers of the unitary group which joined in filing the original return, extension, claim for refund, assessment, collection and payment and determination of the group's tax liability under this Act.
    (f) For taxable years ending prior to December 31, 2014, the Department may promulgate regulations to permit nonresident individual partners of the same partnership, nonresident Subchapter S corporation shareholders of the same Subchapter S corporation, and nonresident individuals transacting an insurance business in Illinois under a Lloyds plan of operation, and nonresident individual members of the same limited liability company that is treated as a partnership under Section 1501 (a)(16) of this Act, to file composite individual income tax returns reflecting the composite income of such individuals allocable to Illinois and to make composite individual income tax payments. For taxable years ending prior to December 31, 2014, the Department may by regulation also permit such composite returns to include the income tax owed by Illinois residents attributable to their income from partnerships, Subchapter S corporations, insurance businesses organized under a Lloyds plan of operation, or limited liability companies that are treated as partnership under Section 1501(a)(16) of this Act, in which case such Illinois residents will be permitted to claim credits on their individual returns for their shares of the composite tax payments. This paragraph of subsection (f) applies to taxable years ending on or after December 31, 1987 and ending prior to December 31, 2014.
    For taxable years ending on or after December 31, 1999, the Department may, by regulation, permit any persons transacting an insurance business organized under a Lloyds plan of operation to file composite returns reflecting the income of such persons allocable to Illinois and the tax rates applicable to such persons under Section 201 and to make composite tax payments and shall, by regulation, also provide that the income and apportionment factors attributable to the transaction of an insurance business organized under a Lloyds plan of operation by any person joining in the filing of a composite return shall, for purposes of allocating and apportioning income under Article 3 of this Act and computing net income under Section 202 of this Act, be excluded from any other income and apportionment factors of that person or of any unitary business group, as defined in subdivision (a)(27) of Section 1501, to which that person may belong.
    For taxable years ending on or after December 31, 2008, every nonresident shall be allowed a credit against his or her liability under subsections (a) and (b) of Section 201 for any amount of tax reported on a composite return and paid on his or her behalf under this subsection (f). Residents (other than persons transacting an insurance business organized under a Lloyds plan of operation) may claim a credit for taxes reported on a composite return and paid on their behalf under this subsection (f) only as permitted by the Department by rule.
    (f-5) For taxable years ending on or after December 31, 2008, the Department may adopt rules to provide that, when a partnership or Subchapter S corporation has made an error in determining the amount of any item of income, deduction, addition, subtraction, or credit required to be reported on its return that affects the liability imposed under this Act on a partner or shareholder, the partnership or Subchapter S corporation may report the changes in liabilities of its partners or shareholders and claim a refund of the resulting overpayments, or pay the resulting underpayments, on behalf of its partners and shareholders.
    (g) The Department may adopt rules to authorize the electronic filing of any return required to be filed under this Section.
(Source: P.A. 97-507, eff. 8-23-11; 98-478, eff. 1-1-14.)

35 ILCS 5/502.1

    (35 ILCS 5/502.1)
    Sec. 502.1. Use tax. Beginning with taxable years ending on or after December 31, 2010, individual purchasers with an annual use tax liability that does not exceed $600 may, in lieu of the filing and payment requirements of Section 10 of the Use Tax Act, file and pay in compliance with this Section.
    Beginning with taxable years ending on or after December 31, 2010, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer's annual individual use tax liability does not exceed $600, he or she may report and pay individual use tax liability at the same time as his or her individual income tax liability. If the taxpayer elects to report and pay his or her individual use tax liability at the same time as his or her standard individual income tax liability in accordance with this Section, then the use tax shown due on the return may be (i) treated as being due at the same time as the income tax obligation, (ii) assessed, collected, and deposited in the same manner as income taxes, and (iii) treated as an income tax liability for all purposes.
    The individual income tax return instructions shall include information explaining the tax imposed under the Use Tax Act and informing taxpayers how to report and pay their use tax obligations, including specific information on how to report and pay individual use tax at the same time as the individual income tax return is filed.
    This Section shall not apply to any amended return.
(Source: P.A. 96-1388, eff. 7-29-10.)

35 ILCS 5/503

    (35 ILCS 5/503) (from Ch. 120, par. 5-503)
    (Text of Section before amendment by P.A. 99-641)
    Sec. 503. Signing of returns and notices.
    (a) Signature presumed authentic. The fact that an individual's name is signed to a return or notice shall be prima facie evidence for all purposes that such document was actually signed by such individual. If a return is prepared by an income tax return preparer for a taxpayer, that preparer shall sign the return as the preparer of that return. If a return is transmitted to the Department electronically, the Department may presume that the electronic return originator has obtained and is transmitting a valid signature document pursuant to the rules promulgated by the Department for the electronic filing of tax returns, or the Department may authorize electronic return originators to maintain the signature documents and associated documentation, subject to the Department's right of inspection at any time without notice, rather than transmitting those documents to the Department, and the Department may process the return.
    (b) Corporations. A return or notice required of a corporation shall be signed by the president, vice-president, treasurer or any other officer duly authorized so to act or, in the case of a limited liability company, by a manager or member. In the case of a return or notice made for a corporation by a fiduciary pursuant to the provisions of Section 502(b)(4), such fiduciary shall sign such document. The fact that an individual's name is signed to a return or notice shall be prima facie evidence that such individual is authorized to sign such document on behalf of the corporation.
    (c) Partnerships. A return or notice of a partnership shall be signed by any one of the partners or, in the case of a limited liability company, by a manager or member. The fact that a partner's name is signed to a return or notice shall be prima facie evidence that such individual is authorized to sign such document on behalf of the partnership or limited liability company.
    (d) Joint fiduciaries. A return or notice signed by one of two or more joint fiduciaries will comply with the requirements of this Act. The fact that a fiduciary's name is signed to such document shall be prima facie evidence that such fiduciary is authorized to sign such document on behalf of the person from whom it is required.
    (e) Failure to sign a return. If a taxpayer fails to sign a return within 30 days after proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed. Any overpayment of tax shown on the face of an unsigned return shall be considered forfeited if after notice and demand for signature by the Department the taxpayer fails to provide a signature and 3 years have passed from the date the return was filed. An overpayment of tax refunded to a taxpayer whose return was filed electronically shall be considered an erroneous refund under Section 912 of this Act if, after proper notice and demand by the Department, the taxpayer fails to provide a required signature document. A notice and demand for signature in the case of a return reflecting an overpayment may be made by first class mail. This subsection (e) shall apply to all returns filed pursuant to the Illinois Income Tax Act since 1969.
(Source: P.A. 88-480; 88-672, eff. 12-14-94; 89-379, eff. 1-1-96; 89-399, eff. 8-20-95; 89-626, eff. 8-9-96.)
 
    (Text of Section after amendment by P.A. 99-641)
    Sec. 503. Signing of returns and notices.
    (a) Signature presumed authentic. The fact that an individual's name is signed to a return or notice shall be prima facie evidence for all purposes that such document was actually signed by such individual. If a return is prepared by an income tax return preparer for a taxpayer, that preparer shall sign the return as the preparer of that return and include his or her PTIN, as defined in the State Tax Preparer Oversight Act, on the return. If a return is transmitted to the Department electronically, the Department may presume that the electronic return originator has obtained and is transmitting a valid signature document pursuant to the rules promulgated by the Department for the electronic filing of tax returns, or the Department may authorize electronic return originators to maintain the signature documents and associated documentation, subject to the Department's right of inspection at any time without notice, rather than transmitting those documents to the Department, and the Department may process the return.
    (b) Corporations. A return or notice required of a corporation shall be signed by the president, vice-president, treasurer or any other officer duly authorized so to act or, in the case of a limited liability company, by a manager or member. In the case of a return or notice made for a corporation by a fiduciary pursuant to the provisions of Section 502(b)(4), such fiduciary shall sign such document. The fact that an individual's name is signed to a return or notice shall be prima facie evidence that such individual is authorized to sign such document on behalf of the corporation.
    (c) Partnerships. A return or notice of a partnership shall be signed by any one of the partners or, in the case of a limited liability company, by a manager or member. The fact that a partner's name is signed to a return or notice shall be prima facie evidence that such individual is authorized to sign such document on behalf of the partnership or limited liability company.
    (d) Joint fiduciaries. A return or notice signed by one of two or more joint fiduciaries will comply with the requirements of this Act. The fact that a fiduciary's name is signed to such document shall be prima facie evidence that such fiduciary is authorized to sign such document on behalf of the person from whom it is required.
    (e) Failure to sign a return. If a taxpayer fails to sign a return within 30 days after proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed. Any overpayment of tax shown on the face of an unsigned return shall be considered forfeited if after notice and demand for signature by the Department the taxpayer fails to provide a signature and 3 years have passed from the date the return was filed. An overpayment of tax refunded to a taxpayer whose return was filed electronically shall be considered an erroneous refund under Section 912 of this Act if, after proper notice and demand by the Department, the taxpayer fails to provide a required signature document. A notice and demand for signature in the case of a return reflecting an overpayment may be made by first class mail. This subsection (e) shall apply to all returns filed pursuant to the Illinois Income Tax Act since 1969.
(Source: P.A. 99-641, eff. 1-1-17.)

35 ILCS 5/504

    (35 ILCS 5/504) (from Ch. 120, par. 5-504)
    Sec. 504. Verification. Each return or notice required to be filed under this Act shall contain or be verified by a written declaration that it is made under the penalties of perjury. A taxpayer's signing a fraudulent return under this Act is perjury, as defined in Section 32-2 of the Criminal Code of 2012.
(Source: P.A. 97-1150, eff. 1-25-13.)

35 ILCS 5/505

    (35 ILCS 5/505) (from Ch. 120, par. 5-505)
    Sec. 505. Time and Place for Filing Returns. (a) In general. Returns required by this Act shall be filed at such place as the Department may by regulations prescribe.
    (1) Corporations. Except as provided in paragraph (3), corporate returns shall be filed on or before the 15th day of the third month following the close of the taxable year, unless, subject to the provisions of Section 602, the Director grants an extension or extensions of time (not to exceed 6 months in the aggregate) for such filing, or unless the income or loss of a taxpayer is reported for federal purposes on a return with a due date later than the 15th day of the third month following the close of the taxable year, in which case the same due date shall apply to the corresponding Illinois return.
    (2) Individuals, partnerships and fiduciaries. Except as provided in paragraph (3), individual, partnership and fiduciary returns shall be filed on or before the 15th day of the fourth month following the close of the taxable year, unless, subject to the provisions of Section 602, the Director grants an extension or extensions of time (not to exceed 6 months in the aggregate) for such filing, except that a final return of a decedent shall be filed at the time (including any extensions thereof) it would have been due if the decedent had not died.
    (3) Certain Exempt Organizations. Organizations which are exempt from the Federal income tax by reason of Section 501(a) of the Internal Revenue Code who determine base income for a taxable year under subsection (a) of Section 205 (other than an employees' trust described in Section 401(a) of the Internal Revenue Code), shall file returns required by this Act on or before the 15th day of the 5th month following the close of the taxable year, unless, subject to the provisions of Section 602, the Director grants an extension or extensions of time (not to exceed 6 months in the aggregate) for such filing.
    (b) Extension of time for filing federal return. When the taxpayer has been granted an extension or extensions of time within which to file his federal income tax return for any taxable year, the filing of a copy of such extension or extensions with the Department shall automatically extend the due date of the return with respect to the tax imposed by this Act for an equivalent period (plus an additional month beyond the federal extension in the case of corporations) if the requirements of Section 602 are met.
    (c) Extension of time for filing when abroad. If an individual is living or traveling outside the United States and Puerto Rico on the 15th day of the 4th month following the close of his taxable year ending on or after December 31, 1983, the return required to be filed under Section 502 of this Act relative to that taxable year shall, in no event, be due prior to the 15th day of the 6th month following the close of that taxable year. In the case of a joint return filed in accordance with Section 502(c), the 2 month extension provided for in this subsection (c) is available if either spouse is living or traveling outside the United States and Puerto Rico on the 15th day of the 4th month following the close of the taxable year ending on or after December 31, 1983. Nothing in this subsection (c) shall be construed to extend the time in which the individual must pay the tax due under Section 601(a).
(Source: P.A. 84-1400.)

35 ILCS 5/506

    (35 ILCS 5/506) (from Ch. 120, par. 5-506)
    Sec. 506. Federal Returns.
    (a) In general. Any person required to make a return for a taxable year under this Act may, at any time that a deficiency could be assessed or a refund claimed under this Act in respect of any item reported or properly reportable on such return or any amendment thereof, be required to furnish to the Department a true and correct copy of any return which may pertain to such item and which was filed by such person under the provisions of the Internal Revenue Code.
    (b) Changes affecting federal income tax. A person shall notify the Department if:
        (1) the taxable income, any item of income or
    
deduction, the income tax liability, or any tax credit reported in an original or amended federal income tax return of that person for any year or as determined by the Internal Revenue Service or the courts is altered by amendment of such return or as a result of any other recomputation or redetermination of federal taxable income or loss, and such alteration reflects a change or settlement with respect to any item or items, affecting the computation of such person's net income, net loss, or of any credit provided by Article 2 of this Act for any year under this Act, or in the number of personal exemptions allowable to such person under Section 151 of the Internal Revenue Code, or
        (2) the amount of tax required to be withheld by that
    
person from compensation paid to employees and required to be reported by that person on a federal return is altered by amendment of the return or by any other recomputation or redetermination that is agreed to or finally determined on or after January 1, 2003, and the alteration affects the amount of compensation subject to withholding by that person under Section 701 of this Act.
Such notification shall be in the form of an amended return or such other form as the Department may by regulations prescribe, shall contain the person's name and address and such other information as the Department may by regulations prescribe, shall be signed by such person or his duly authorized representative, and shall be filed not later than 120 days after such alteration has been agreed to or finally determined for federal income tax purposes or any federal income tax deficiency or refund, tentative carryback adjustment, abatement or credit resulting therefrom has been assessed or paid, whichever shall first occur.
(Source: P.A. 97-507, eff. 8-23-11.)

35 ILCS 5/506.5

    (35 ILCS 5/506.5)
    Sec. 506.5. Returns based on substitute W-2 forms. For a taxpayer who has received wages from an employer in Illinois, loses or was not provided a W-2 form, is unable to obtain a duplicate W-2 form from the employer, and subsequently obtains a substitute W-2 form from the Internal Revenue Service, it shall be presumed that tax was withheld under Article 7 of this Act in an appropriate amount based on the number of withholding exemptions used to determine the federal income tax withholding for the taxpayer if (i) the substitute W-2 form indicates the appropriate amount of federal taxes withheld, (ii) the taxpayer files a copy of the substitute W-2 form with his or her Illinois income tax return, and (iii) the taxpayer provides a mailing address to which any correspondence or refund, if any, may be sent.
(Source: P.A. 94-1074, eff. 12-26-06.)

35 ILCS 5/507

    (35 ILCS 5/507) (from Ch. 120, par. 5-507)
    Sec. 507. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507A

    (35 ILCS 5/507A) (from Ch. 120, par. 5-507A)
    Sec. 507A. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507B

    (35 ILCS 5/507B) (from Ch. 120, par. 5-507B)
    Sec. 507B. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507C

    (35 ILCS 5/507C) (from Ch. 120, par. 5-507C)
    Sec. 507C. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507D

    (35 ILCS 5/507D) (from Ch. 120, par. 5-507D)
    Sec. 507D. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02, and by P.A. 92-790, eff. 8-6-02.)

35 ILCS 5/507E

    (35 ILCS 5/507E) (from Ch. 120, par. 5-507E)
    Sec. 507E. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507F

    (35 ILCS 5/507F) (from Ch. 120, par. 5-507F)
    Sec. 507F. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507G

    (35 ILCS 5/507G) (from Ch. 120, par. 5-507G)
    Sec. 507G. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507H

    (35 ILCS 5/507H) (from Ch. 120, par. 5-507H)
    Sec. 507H. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507I

    (35 ILCS 5/507I) (from Ch. 120, par. 5-507I)
    Sec. 507I. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507J

    (35 ILCS 5/507J)
    Sec. 507J. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507K

    (35 ILCS 5/507K)
    Sec. 507K. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507L

    (35 ILCS 5/507L)
    Sec. 507L. Penny Severns Breast and Cervical Cancer Research Fund checkoff. Beginning with taxable years ending on December 31, 1999, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Penny Severns Breast and Cervical Cancer Research Fund as authorized by this amendatory Act of the 91st General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of the payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to an amended return.
(Source: P.A. 91-107, eff. 7-13-99.)

35 ILCS 5/507M

    (35 ILCS 5/507M)
    Sec. 507M. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507N

    (35 ILCS 5/507N)
    Sec. 507N. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507O

    (35 ILCS 5/507O)
    Sec. 507O. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507P

    (35 ILCS 5/507P)
    Sec. 507P. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507Q

    (35 ILCS 5/507Q)
    Sec. 507Q. (Repealed).
(Source: P.A. 89-324, eff. 8-13-95. Repealed by P.A. 91-833, eff. 1-1-01; 91-836, eff. 1-1-01.)

35 ILCS 5/507R

    (35 ILCS 5/507R)
    Sec. 507R. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507S

    (35 ILCS 5/507S)
    Sec. 507S. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507T

    (35 ILCS 5/507T)
    Sec. 507T. (Repealed).
(Source: P.A. 92-84, eff. 7-1-02. Repealed internally, eff. 7-1-02.)

35 ILCS 5/507U

    (35 ILCS 5/507U)
    Sec. 507U. Prostate Cancer Research Fund checkoff. The Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Prostate Cancer Research Fund, as authorized by this amendatory Act of the 91st General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 91-104, eff. 7-13-99.)

35 ILCS 5/507V

    (35 ILCS 5/507V)
    Sec. 507V. National World War II Memorial Fund checkoff. The Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the National World War II Memorial Fund, as authorized by this amendatory Act of the 91st General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 91-833, eff. 1-1-01; 91-836, eff. 1-1-01; 92-651, eff. 7-11-02.)

35 ILCS 5/507W

    (35 ILCS 5/507W)
    Sec. 507W. (Repealed).
(Source: P.A. 92-651, eff. 7-11-02. Repealed by P.A. 99-576, eff. 7-15-16.)

35 ILCS 5/507X

    (35 ILCS 5/507X)
    Sec. 507X. The Multiple Sclerosis Assistance Fund checkoff. Beginning with taxable years ending on or after December 31, 2002, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Multiple Sclerosis Assistance Fund, as authorized by this amendatory Act of the 92nd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 95-331, eff. 8-21-07.)

35 ILCS 5/507Y

    (35 ILCS 5/507Y)
    Sec. 507Y. The Illinois Military Family Relief checkoff. Beginning with taxable years ending on or after December 31, 2003, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Illinois Military Family Relief Fund, as authorized by this amendatory Act of the 92nd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 95-331, eff. 8-21-07.)

35 ILCS 5/507Z

    (35 ILCS 5/507Z)
    Sec. 507Z. World War II Illinois Veterans Memorial Fund checkoff. Beginning with taxable years ending on or after December 31, 2003, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the World War II Illinois Veterans Memorial Fund, as authorized by this amendatory Act of the 93rd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
    The Department shall clearly state in its instructions to taxpayers and shall make it clear on the tax return form itself that money donated to the World War II Illinois Veterans Memorial Fund will go to fund a World War II memorial to Illinois Veterans located in Springfield, Illinois and will not go to the World War II Memorial Fund created to fund a national World War II memorial in Washington, D.C.
(Source: P.A. 93-131, eff. 7-10-03.)

35 ILCS 5/507AA

    (35 ILCS 5/507AA)
    Sec. 507AA. The Lou Gehrig's Disease (ALS) Research Fund checkoff. Beginning with the taxable year ending on December 31, 2003, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Lou Gehrig's Disease (ALS) Research Fund, as authorized by this amendatory Act of the 93rd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 95-331, eff. 8-21-07.)

35 ILCS 5/507BB

    (35 ILCS 5/507BB)
    Sec. 507BB. Asthma and Lung Research checkoff. The Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Asthma and Lung Research Fund, as authorized by this amendatory Act of the 93rd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment reduces the contribution accordingly. This Section does not apply to an amended return.
(Source: P.A. 95-331, eff. 8-21-07.)

35 ILCS 5/507CC

    (35 ILCS 5/507CC)
    Sec. 507CC. The Leukemia Treatment and Education checkoff. The Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Leukemia Treatment and Education Fund, as authorized by this amendatory Act of the 93rd General Assembly, he or she may do so be stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 95-331, eff. 8-21-07.)

35 ILCS 5/507DD

    (35 ILCS 5/507DD)
    Sec. 507DD. The Illinois Veterans' Homes Fund checkoff. For taxable years ending on or after December 31, 2004, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Illinois Veterans' Homes Fund, as authorized by this amendatory Act of the 93rd General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 93-776, eff. 7-21-04.)

35 ILCS 5/507EE

    (35 ILCS 5/507EE)
    Sec. 507EE. Pet Population Control Fund checkoff. The Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Pet Population Control Fund, as established in the Illinois Public Health and Safety Animal Population Control Act, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
    The Department of Revenue shall determine annually the total amount contributed to the Fund pursuant to this Section and shall notify the State Comptroller and the State Treasurer of the amount to be transferred to the Pet Population Control Fund, and upon receipt of the notification the State Comptroller shall transfer the amount.
(Source: P.A. 94-639, eff. 8-22-05; 95-331, eff. 8-21-07.)

35 ILCS 5/507FF

    (35 ILCS 5/507FF)
    Sec. 507FF. Epilepsy Treatment and Education Grants-in-Aid Fund checkoff. The Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Epilepsy Treatment and Education Grants-in-Aid Fund, as authorized by Public Act 94-73, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 94-73, eff. 6-23-05; 95-331, eff. 8-21-07.)

35 ILCS 5/507GG

    (35 ILCS 5/507GG)
    Sec. 507GG. Diabetes Research Checkoff Fund checkoff. For taxable years ending on or after December 31, 2005, the Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Diabetes Research Checkoff Fund, as authorized by Public 94-107, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 94-107, eff. 7-1-05; 95-331, eff. 8-21-07.)

35 ILCS 5/507HH

    (35 ILCS 5/507HH)
    Sec. 507HH. Sarcoidosis Research Fund checkoff. The Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Sarcoidosis Research Fund, as authorized by Public Act 94-141, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 94-141, eff. 1-1-06; 95-331, eff. 8-21-07.)

35 ILCS 5/507II

    (35 ILCS 5/507II)
    Sec. 507II. The Vince Demuzio Memorial Colon Cancer Fund checkoff. For taxable years ending on or after December 31, 2005, the Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Vince Demuzio Memorial Colon Cancer Fund, as authorized by Public Act 94-142, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 94-142, eff. 1-1-06; 95-331, eff. 8-21-07.)

35 ILCS 5/507JJ

    (35 ILCS 5/507JJ)
    Sec. 507JJ. The Autism Research Checkoff Fund checkoff. For taxable years ending on or after December 31, 2005, the Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Autism Research Checkoff Fund, as authorized by Public Act 94-442, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 98-463, eff. 8-16-13.)

35 ILCS 5/507KK

    (35 ILCS 5/507KK)
    Sec. 507KK. Blindness Prevention Fund checkoff. For taxable years ending on or after December 31, 2005, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Blindness Prevention Fund, as authorized by Public Act 94-602, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 94-602, eff. 8-16-05; 95-331, eff. 8-21-07.)

35 ILCS 5/507LL

    (35 ILCS 5/507LL)
    Sec. 507LL. The Illinois Brain Tumor Research checkoff. For taxable years ending on or after December 31, 2005, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Illinois Brain Tumor Research Fund, as authorized by Public Act 94-649, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to any amended return.
(Source: P.A. 94-649, eff. 8-22-05; 95-331, eff. 8-21-07.)

35 ILCS 5/507MM

    (35 ILCS 5/507MM)
    Sec. 507MM. Supplemental Low-Income Energy Assistance Fund checkoff. Beginning with taxable years ending on December 31, 2006, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Supplemental Low-Income Energy Assistance Fund as authorized by this amendatory Act of the 94th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of the payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to an amended return.
(Source: P.A. 94-773, eff. 5-18-06.)

35 ILCS 5/507NN

    (35 ILCS 5/507NN)
    Sec. 507NN. The Heartsaver AED Fund checkoff. For taxable years ending on or after December 31, 2005, the Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Heartsaver AED Fund, as authorized by this amendatory Act of the 94th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 94-876, eff. 6-19-06; 95-331, eff. 8-21-07.)

35 ILCS 5/507OO

    (35 ILCS 5/507OO)
    Sec. 507OO. (Renumbered).
(Source: Renumbered by P.A. 95-876, eff. 8-21-08.)

35 ILCS 5/507PP

    (35 ILCS 5/507PP)
    Sec. 507PP. The lung cancer research checkoff. For taxable years ending on or after December 31, 2007, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Lung Cancer Research Fund, as authorized by this amendatory Act of the 95th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 95-434, eff. 8-27-07; 95-876, eff. 8-21-08; 96-328, eff. 8-11-09.)

35 ILCS 5/507QQ

    (35 ILCS 5/507QQ)
    Sec. 507QQ. The autoimmune disease research checkoff. For taxable years ending on or after December 31, 2007, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Autoimmune Disease Research Fund, as authorized by this amendatory Act of the 95th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 95-435, eff. 8-27-07; 95-876, eff. 8-21-08.)

35 ILCS 5/507RR

    (35 ILCS 5/507RR)
    Sec. 507RR. The Healthy Smiles Fund checkoff. For taxable years ending on or after December 31, 2008, the Department must print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Healthy Smiles Fund, as authorized by this amendatory Act of the 95th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 95-940, eff. 8-29-08; 96-328, eff. 8-11-09.)

35 ILCS 5/507SS

    (35 ILCS 5/507SS)
    Sec. 507SS. The hunger relief checkoff. For taxable years ending on or after December 31, 2009, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Hunger Relief Fund, as authorized by Public Act 96-604, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 96-604, eff. 8-24-09; 96-1000, eff. 7-2-10.)

35 ILCS 5/507TT

    (35 ILCS 5/507TT)
    Sec. 507TT. The crisis nursery checkoff. For taxable years ending on or after December 31, 2009, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Crisis Nursery Fund, as authorized by Public Act 96-627, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 96-627, eff. 8-24-09; 96-1000, eff. 7-2-10.)

35 ILCS 5/507UU

    (35 ILCS 5/507UU)
    Sec. 507UU. (Repealed).
(Source: P.A. 96-1424, eff. 8-3-10. Repealed by P.A. 99-576, eff. 7-15-16.)

35 ILCS 5/507VV

    (35 ILCS 5/507VV)
    Sec. 507VV. (Repealed).
(Source: P.A. 96-1424, eff. 8-3-10. Repealed by P.A. 99-576, eff. 7-15-16.)

35 ILCS 5/507WW

    (35 ILCS 5/507WW)
    Sec. 507WW. The State parks checkoff. For taxable years ending on or after December 31, 2010, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the State Parks Fund, as authorized by this amendatory Act of the 96th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 96-1424, eff. 8-3-10.)

35 ILCS 5/507XX

    (35 ILCS 5/507XX)
    Sec. 507XX. The property tax relief checkoff for veterans with disabilities. For taxable years ending on or after December 31, 2010, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Property Tax Relief for Veterans with Disabilities Fund, as authorized by this amendatory Act of the 96th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 99-143, eff. 7-27-15.)

35 ILCS 5/507YY

    (35 ILCS 5/507YY)
    Sec. 507YY. Crime Stoppers checkoff. For taxable years ending on or after December 31, 2011, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Illinois State Crime Stoppers Association Fund, as authorized by this amendatory Act of the 97th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 97-478, eff. 8-22-11.)

35 ILCS 5/507ZZ

    (35 ILCS 5/507ZZ)
    Sec. 507ZZ. After-School Rescue Fund checkoff. For taxable years ending on or after December 31, 2011, the Department must print on its standard individual income tax form a provision (i) indicating that if the taxpayer wishes to contribute to the After-School Rescue Fund, as authorized by this amendatory Act of the 97th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and (ii) stating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 97-478, eff. 8-22-11.)

35 ILCS 5/507AAA

    (35 ILCS 5/507AAA)
    Sec. 507AAA. The Childhood Cancer Research Fund checkoff. For taxable years ending on or after December 31, 2012, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Childhood Cancer Research Fund, as authorized by this amendatory Act of the 97th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 97-1117, eff. 8-27-12.)

35 ILCS 5/507BBB

    (35 ILCS 5/507BBB)
    Sec. 507BBB. The Children's Wellness Charities Fund checkoff. For taxable years ending on or after December 31, 2012, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Children's Wellness Charities Fund, as authorized by this amendatory Act of the 97th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 97-1117, eff. 8-27-12.)

35 ILCS 5/507CCC

    (35 ILCS 5/507CCC)
    Sec. 507CCC. The Housing for Families Fund checkoff. For taxable years ending on or after December 31, 2012, the Department shall print, on its standard individual income tax form, a provision indicating that, if the taxpayer wishes to contribute to the Housing for Families Fund, as authorized by this amendatory Act of the 97th General Assembly, then he or she may do so by stating the amount of the contribution (not less than $1) on the return and indicating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. The taxpayer's failure to remit any amount of the increased payment reduces the contribution accordingly. This Section does not apply to any amended return.
(Source: P.A. 97-1117, eff. 8-27-12.)

35 ILCS 5/507DDD

    (35 ILCS 5/507DDD)
    Sec. 507DDD. Special Olympics Illinois and Special Children's Checkoff. For taxable years beginning on or after January 1, 2015, the Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Special Olympics Illinois and Special Children's Charities Checkoff Fund as authorized by Public Act 99-423, he or she may do so by stating the amount of the contribution (not less than $1) on the return and that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to an amended return. For the purpose of this Section, the Department of Revenue must distribute the moneys as provided in subsection 21.9(b) of the Illinois Lottery Law: (i) 75% of the moneys to Special Olympics Illinois to support the statewide training, competitions, and programs for future Special Olympics athletes; and (ii) 25% of the moneys to Special Children's Charities to support the City of Chicago-wide training, competitions, and programs for future Special Olympics athletes.
(Source: P.A. 99-423, eff. 8-20-15; 99-642, eff. 7-28-16.)

35 ILCS 5/507EEE

    (35 ILCS 5/507EEE)
    (Section scheduled to be repealed on December 31, 2017)
    Sec. 507EEE. U.S.S. Illinois Commissioning Fund checkoff. For taxable years ending on or after December 31, 2014 and ending on or before December 31, 2016, the Department must print on its standard individual income tax form a provision (i) indicating that if the taxpayer wishes to contribute to the U.S.S. Illinois Commissioning Fund, a special fund created in the State treasury, for the purpose of donating to the U.S.S. Illinois Commissioning Committee, as authorized by this amendatory Act of the 99th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and (ii) stating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. Notwithstanding any other provision of law, moneys deposited into the U.S.S. Illinois Commissioning Fund from contributions under this Section shall be used by the Department of Military Affairs to make grants to the U.S.S. Illinois Commissioning Committee. This Section does not apply to any amended return.
    This Section is repealed on December 31, 2017.
(Source: P.A. 99-423, eff. 8-20-15.)

35 ILCS 5/507FFF

    (35 ILCS 5/507FFF)
    Sec. 507FFF. Autism Care Fund checkoff. For taxable years ending on or after December 31, 2015, the Department must print on its standard individual income tax form a provision (i) indicating that if the taxpayer wishes to contribute to the Autism Care Fund, a special fund created in the State treasury, for the purpose of donating to the Autism Society of Illinois, as authorized by this amendatory Act of the 99th General Assembly, he or she may do so by stating the amount of the contribution (not less than $1) on the return and (ii) stating that the contribution will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. Notwithstanding any other provision of law, moneys deposited into the Autism Care Fund from contributions under this Section shall be used by the Department of Human Services to make grants to the Autism Society of Illinois. This Section does not apply to any amended return.
(Source: P.A. 99-423, eff. 8-20-15.)

35 ILCS 5/508

    (35 ILCS 5/508) (from Ch. 120, par. 5-508)
    Sec. 508. The Department shall determine on October 1 of each year the total amount contributed to the Child Abuse Prevention Fund pursuant to this Act and shall notify the State Comptroller and the State Treasurer of such amount to be transferred to the Child Abuse Prevention Fund, and upon receipt of such notification the State Treasurer and Comptroller shall transfer such amount.
(Source: P.A. 85-731.)

35 ILCS 5/509

    (35 ILCS 5/509) (from Ch. 120, par. 5-509)
    Sec. 509. Tax checkoff explanations.
    (a) All individual income tax return forms shall contain appropriate explanations and spaces to enable the taxpayers to designate contributions to the funds to which contributions may be made under this Article 5.
    (b) Each form shall contain a statement that the contributions will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly.
    (c) If, on October 1 of any year, the total contributions to any one of the funds made under this Article 5 do not equal $100,000 or more, the explanations and spaces for designating contributions to the fund shall be removed from the individual income tax return forms for the following and all subsequent years and all subsequent contributions to the fund shall be refunded to the taxpayer. This contribution requirement does not apply to the Diabetes Research Checkoff Fund checkoff contained in Section 507GG of this Act.
    (d) Notwithstanding any other provision of law, the Department shall include the Hunger Relief Fund checkoff established under Section 507SS on the individual income tax form for the taxable year beginning on January 1, 2012. If, on October 1, 2013, or on October 1 of any subsequent year, the total contributions to the Hunger Relief Fund checkoff do not equal $100,000 or more, the explanations and spaces for designating contributions to the fund shall be removed from the individual income tax return forms for the following and all subsequent years and all subsequent contributions to the fund shall be refunded to the taxpayer.
(Source: P.A. 96-328, eff. 8-11-09; 97-1117, eff. 8-27-12.)

35 ILCS 5/509.1

    (35 ILCS 5/509.1)
    Sec. 509.1. Removal of excess tax-checkoff funds. Notwithstanding any provisions of this Act to the contrary, beginning on the effective date of this amendatory Act of the 95th General Assembly, there may not be more than 15 tax-checkoff funds contained on the individual tax return form at any one time. Each year, the Department shall determine whether the sum of (i) the number of new tax-checkoff funds created by the General Assembly during that year plus (ii) the number of tax-checkoff funds that collected at least $100,000 during the previous year exceeds 15. If so, then the Department shall remove a number of tax-checkoff funds that were on the return during the previous year that is equal to the sum of items (i) and (ii) minus 15, starting with the tax-checkoff fund that received the least amount of contributions and working upward until a sufficient number of funds have been removed. The Hunger Relief Fund checkoff established under Section 507SS shall be included among the 15 tax-checkoff funds as provided in subsection (d) of Section 509 of this Act.
    For taxable years ending on or after December 31, 2012, the Diabetes Research Checkoff Fund checkoff contained in Section 507GG of this Act shall be included on the individual tax return form notwithstanding the provisions of this Section. The Diabetes Research Checkoff Fund checkoff shall not be included when calculating the 15 tax-checkoff fund limitation set forth in this Section.
(Source: P.A. 97-1117, eff. 8-27-12.)

35 ILCS 5/510

    (35 ILCS 5/510) (from Ch. 120, par. 5-510)
    Sec. 510. Determination of amounts contributed. The Department shall determine the total amount contributed to each of the funds under this Article 5 and shall notify the State Comptroller and the State Treasurer of the amounts to be transferred from the General Revenue Fund to each fund, and upon receipt of such notification the State Treasurer and Comptroller shall transfer the amounts.
(Source: P.A. 95-331, eff. 8-21-07; 95-434, eff. 8-27-07; 95-435, eff. 8-27-07; 95-940, eff. 8-29-08; 96-328, eff. 8-11-09.)

35 ILCS 5/511

    (35 ILCS 5/511) (from Ch. 120, par. 5-511)
    Sec. 511. Unless the Department is contesting an individual income tax refund due to any taxpayer, the Department shall provide the Comptroller with authorization for such refund to the taxpayer within 120 days of the date on which the return is received by the Department, as long as there are available funds from which to pay such refunds.
(Source: P.A. 84-1079.)

35 ILCS 5/512

    (35 ILCS 5/512) (from Ch. 120, par. 5-512)
    Sec. 512. (a) All individual income tax return forms for tax years ending December 31, 1986 through December 30, 1995 shall contain an appropriate space in which the taxpayer must indicate either (i) the name and number of the high school district in which they reside on the date such return is filed, or (ii) the name and number of the unit school district in which they reside on the date such return is filed. Failure of the taxpayer to insert such information shall not invalidate the return.
    (b) For all tax years ending December 31, 1995 and thereafter, the Department shall provide the State Board of Education with information on individual income tax receipts by school district from the data collected by the Geographic Information System maintained by the Department.
(Source: P.A. 89-21, eff. 7-1-95.)

35 ILCS 5/516

    (35 ILCS 5/516) (from Ch. 120, par. 5-516)
    Sec. 516. The Department shall print on its standard individual income tax form a provision indicating that if the taxpayer wishes to contribute to the Assistance to the Homeless Fund created by this amendatory Act of 1989, he or she may do so by stating the amount of such contribution (not less than $1) on such return and that such contributions will reduce the taxpayer's refund or increase the amount of payment to accompany the return. Failure to remit any amount of increased payment shall reduce the contribution accordingly. This Section shall not apply to an amended return.
(Source: P.A. 86-960.)

35 ILCS 5/Art. 6

 
    (35 ILCS 5/Art. 6 heading)
ARTICLE 6. PAYMENTS.

35 ILCS 5/601

    (35 ILCS 5/601) (from Ch. 120, par. 6-601)
    Sec. 601. Payment on Due Date of Return.
    (a) In general. Every taxpayer required to file a return under this Act shall, without assessment, notice or demand, pay any tax due thereon to the Department, at the place fixed for filing, on or before the date fixed for filing such return (determined without regard to any extension of time for filing the return) pursuant to regulations prescribed by the Department. If, however, the due date for payment of a taxpayer's federal income tax liability for a tax year (as provided in the Internal Revenue Code or by Treasury regulation, or as extended by the Internal Revenue Service) is later than the date fixed for filing the taxpayer's Illinois income tax return for that tax year, the Department may, by rule, prescribe a due date for payment that is not later than the due date for payment of the taxpayer's federal income tax liability. For purposes of the Illinois Administrative Procedure Act, the adoption of rules to prescribe a later due date for payment shall be deemed an emergency and necessary for the public interest, safety, and welfare.
    (b) Amount payable. In making payment as provided in this section there shall remain payable only the balance of such tax remaining due after giving effect to the following:
        (1) Withheld tax. Any amount withheld during any
    
calendar year pursuant to Article 7 from compensation paid to a taxpayer shall be deemed to have been paid on account of any tax imposed by subsections 201(a) and (b) of this Act on such taxpayer for his taxable year beginning in such calendar year. If more than one taxable year begins in a calendar year, such amount shall be deemed to have been paid on account of such tax for the last taxable year so beginning.
        (2) Estimated and tentative tax payments. Any amount
    
of estimated tax paid by a taxpayer pursuant to Article 8 for a taxable year shall be deemed to have been paid on account of the tax imposed by this Act for such taxable year.
        (3) Foreign tax. The aggregate amount of tax which is
    
imposed upon or measured by income and which is paid by a resident for a taxable year to another state or states on income which is also subject to the tax imposed by subsections 201(a) and (b) of this Act shall be credited against the tax imposed by subsections 201(a) and (b) otherwise due under this Act for such taxable year. For taxable years ending prior to December 31, 2009, the aggregate credit provided under this paragraph shall not exceed that amount which bears the same ratio to the tax imposed by subsections 201(a) and (b) otherwise due under this Act as the amount of the taxpayer's base income subject to tax both by such other state or states and by this State bears to his total base income subject to tax by this State for the taxable year. For taxable years ending on or after December 31, 2009, the credit provided under this paragraph for tax paid to other states shall not exceed that amount which bears the same ratio to the tax imposed by subsections 201(a) and (b) otherwise due under this Act as the amount of the taxpayer's base income that would be allocated or apportioned to other states if all other states had adopted the provisions in Article 3 of this Act bears to the taxpayer's total base income subject to tax by this State for the taxable year. The credit provided by this paragraph shall not be allowed if any creditable tax was deducted in determining base income for the taxable year. Any person claiming such credit shall attach a statement in support thereof and shall notify the Director of any refund or reductions in the amount of tax claimed as a credit hereunder all in such manner and at such time as the Department shall by regulations prescribe.
        (4) Accumulation and capital gain distributions. If
    
the net income of a taxpayer includes amounts included in his base income by reason of Section 667 of the Internal Revenue Code (relating to accumulation and capital gain distributions by a trust, respectively), the tax imposed on such taxpayer by this Act shall be credited with his pro rata portion of the taxes imposed by this Act on such trust for preceding taxable years which would not have been payable for such preceding years if the trust had in fact made distributions to its beneficiaries at the times and in the amounts specified in Sections 666 and 669 of the Internal Revenue Code. The credit provided by this paragraph shall not reduce the tax otherwise due from the taxpayer to an amount less than that which would be due if the amounts included by reason of Section 667 of the Internal Revenue Code were excluded from his or her base income.
    (c) Cross reference. For application against tax due of overpayments of tax for a prior year, see Section 909.
(Source: P.A. 96-468, eff. 8-14-09; 97-507, eff. 8-23-11.)

35 ILCS 5/601.1

    (35 ILCS 5/601.1) (Ch. 120, par. 6-601.1)
    Sec. 601.1. Payment by electronic funds transfer.
    (a) Beginning on October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more under Article 7 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1993, a taxpayer who has an average quarterly estimated tax payment obligation of $450,000 or more under Article 8 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning on October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more under Article 7 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average quarterly estimated tax payment obligation of $300,000 or more under Article 8 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning on October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more under Article 7 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average quarterly estimated tax payment obligation of $150,000 or more under Article 8 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning on October 1, 2000, and for all liability periods thereafter, a taxpayer who has an average annual tax liability of $200,000 or more under Article 7 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an average quarterly estimated tax payment obligation of $50,000 or more under Article 8 of this Act shall make all payments required by rules of the Department by electronic funds transfer. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.
    (b) Any taxpayer who is not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.
    (c) All taxpayers required to make payments by electronic funds transfer and any taxpayers who wish to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.
    (d) The Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers notified by the Department shall make payments by electronic funds transfer for a minimum of one year beginning on October 1. In determining the threshold amounts under subsection (a), the Department shall calculate the averages as follows:
        (1) the total liability under Article 7 for the
    
preceding tax year (and, prior to October 1, 2000, divided by 12); or
        (2) for purposes of estimated payments under Article
    
8, the total tax obligation of the taxpayer for the previous tax year divided by 4.
    (e) The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.
(Source: P.A. 91-541, eff. 8-13-99; 92-492, eff. 1-1-02; 92-846, eff. 8-23-02.)

35 ILCS 5/602

    (35 ILCS 5/602) (from Ch. 120, par. 6-602)
    Sec. 602. Tentative Payments.
    (a) In general. Pursuant to Section 505, the Department may promulgate regulations to provide automatic extensions of the time for filing a return. In connection with any other extension provided under Section 505 of the time for filing a return, the taxpayer shall file a tentative tax return and pay, on or before the date prescribed by law for the filing of such return (determined without regard to any extensions of time for such filing), the amount properly estimated as his tax for the taxable year.
    (b) Interest and Penalty. Interest and penalty on any amount of tax due and unpaid for the period of any extension shall be payable as provided by the Uniform Penalty and Interest Act. However, if the taxpayer is a member, or, in the case of a joint return, the spouse of a member, of the United States Armed Forces serving in a combat zone and subject to a filing extension in accordance with a proclamation by the President of the United States pursuant to Section 7508 of the Internal Revenue Code, no interest or penalty shall be applicable for the taxable year ending on and after December 31, 1990.
(Source: P.A. 87-205; 87-339; 87-895.)

35 ILCS 5/603

    (35 ILCS 5/603) (from Ch. 120, par. 6-603)
    Sec. 603. (Repealed).
(Source: Repealed by P.A. 88-195.)

35 ILCS 5/604

    (35 ILCS 5/604) (from Ch. 120, par. 6-604)
    Sec. 604. Any payment to the Department which is made by a check or money order not payable to the Department shall, within 15 days after receipt thereof, be returned by the Department to the taxpayer who submitted such check or money order or, if the amount of payment is equal to the amount owed to the State of Illinois, the Department may deposit such check.
(Source: P.A. 86-977.)

35 ILCS 5/605

    (35 ILCS 5/605) (from Ch. 120, par. 6-605)
    Sec. 605. The Department may adopt rules and regulations for payment of taxes due under this Act by credit card only when the Department is not required to pay a discount fee charged by the credit card issuer.
(Source: P.A. 87-1175; 87-1189.)

35 ILCS 5/606

    (35 ILCS 5/606)
    Sec. 606. EDGE payment. A payment includes a payment provided for in subsection (g) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act.
(Source: P.A. 96-836, eff. 12-16-09; 96-1000, eff. 7-2-10.)

35 ILCS 5/Art. 7

 
    (35 ILCS 5/Art. 7 heading)
ARTICLE 7. WITHHOLDING TAX.

35 ILCS 5/701

    (35 ILCS 5/701) (from Ch. 120, par. 7-701)
    Sec. 701. Requirement and Amount of Withholding.
    (a) In General. Every employer maintaining an office or transacting business within this State and required under the provisions of the Internal Revenue Code to withhold a tax on:
        (1) compensation paid in this State (as determined
    
under Section 304(a)(2)(B) to an individual; or
        (2) payments described in subsection (b) shall deduct
    
and withhold from such compensation for each payroll period (as defined in Section 3401 of the Internal Revenue Code) an amount equal to the amount by which such individual's compensation exceeds the proportionate part of this withholding exemption (computed as provided in Section 702) attributable to the payroll period for which such compensation is payable multiplied by a percentage equal to the percentage tax rate for individuals provided in subsection (b) of Section 201.
    (b) Payment to Residents. Any payment (including compensation, but not including a payment from which withholding is required under Section 710 of this Act) to a resident by a payor maintaining an office or transacting business within this State (including any agency, officer, or employee of this State or of any political subdivision of this State) and on which withholding of tax is required under the provisions of the Internal Revenue Code shall be deemed to be compensation paid in this State by an employer to an employee for the purposes of Article 7 and Section 601(b)(1) to the extent such payment is included in the recipient's base income and not subjected to withholding by another state. Notwithstanding any other provision to the contrary, no amount shall be withheld from unemployment insurance benefit payments made to an individual pursuant to the Unemployment Insurance Act unless the individual has voluntarily elected the withholding pursuant to rules promulgated by the Director of Employment Security.
    (c) Special Definitions. Withholding shall be considered required under the provisions of the Internal Revenue Code to the extent the Internal Revenue Code either requires withholding or allows for voluntary withholding the payor and recipient have entered into such a voluntary withholding agreement. For the purposes of Article 7 and Section 1002(c) the term "employer" includes any payor who is required to withhold tax pursuant to this Section.
    (d) Reciprocal Exemption. The Director may enter into an agreement with the taxing authorities of any state which imposes a tax on or measured by income to provide that compensation paid in such state to residents of this State shall be exempt from withholding of such tax; in such case, any compensation paid in this State to residents of such state shall be exempt from withholding. All reciprocal agreements shall be subject to the requirements of Section 2505-575 of the Department of Revenue Law (20 ILCS 2505/2505-575).
    (e) Notwithstanding subsection (a)(2) of this Section, no withholding is required on payments for which withholding is required under Section 3405 or 3406 of the Internal Revenue Code.
(Source: P.A. 97-507, eff. 8-23-11; 98-496, eff. 1-1-14.)

35 ILCS 5/702

    (35 ILCS 5/702) (from Ch. 120, par. 7-702)
    Sec. 702. Amount Exempt from Withholding. For purposes of this Section an employee shall be entitled to a withholding exemption in an amount equal to the basic amount in Section 204(b) for each personal or dependent exemption which he is entitled to claim on his federal return pursuant to Section 151 of the Internal Revenue Code; plus an allowance equal to $1,000 for each $1,000 he is entitled to deduct from gross income in arriving at adjusted gross income pursuant to Section 62 of the Internal Revenue Code; plus an additional allowance equal to $1,000 for each $1,000 eligible for subtraction on his Illinois income tax return as Illinois real estate taxes paid during the taxable year; or in any lesser amount claimed by him. Every employee shall furnish to his employer such information as is required for the employer to make an accurate withholding under this Act. The employer may rely on this information for withholding purposes. If any employee fails or refuses to furnish such information, the employer shall withhold the full rate of tax from the employee's total compensation.
(Source: P.A. 97-507, eff. 8-23-11.)

35 ILCS 5/703

    (35 ILCS 5/703) (from Ch. 120, par. 7-703)
    Sec. 703. Information statement. Every employer required to deduct and withhold tax under this Act from compensation of an employee, or who would have been required so to deduct and withhold tax if the employee's withholding exemption were not in excess of the basic amount in Section 204(b), shall furnish in duplicate to each such employee in respect of the compensation paid by such employer to such employee during the calendar year on or before January 31 of the succeeding year, or, if his employment is terminated before the close of such calendar year, on the date on which the last payment of compensation is made, a written statement in such form as the Department may by regulation prescribe showing the amount of compensation paid by the employer to the employee, the amount deducted and withheld as tax, and such other information as the Department shall prescribe. A copy of such statement shall be filed by the employee with his return for his taxable year to which it relates (as determined under Section 601(b)(1)).
(Source: P.A. 97-507, eff. 8-23-11.)

35 ILCS 5/704

    (35 ILCS 5/704) (from Ch. 120, par. 7-704)
    Sec. 704. Employer's Return and Payment of Tax Withheld.
    (a) In general, every employer who deducts and withholds or is required to deduct and withhold tax under this Act prior to January 1, 2008, shall make such payments and returns as provided in this Section.
    (b) Quarter Monthly Payments: Returns. Every employer who deducts and withholds or is required to deduct and withhold tax under this Act shall, on or before the third banking day following the close of a quarter monthly period, pay to the Department or to a depositary designated by the Department, pursuant to regulations prescribed by the Department, the taxes so required to be deducted and withheld, whenever the aggregate amount withheld by such employer (together with amounts previously withheld and not paid to the Department) exceeds $1,000. For purposes of this Section, Saturdays, Sundays, legal holidays and local bank holidays are not banking days. A quarter monthly period, for purposes of this subsection, ends on the 7th, 15th, 22nd and last day of each calendar month. Every such employer shall for each calendar quarter, on or before the last day of the first month following the close of such quarter, and for the calendar year, on or before January 31 of the succeeding calendar year, make a return with respect to such taxes in such form and manner as the Department may by regulations prescribe, and pay to the Department or to a depositary designated by the Department all withheld taxes not previously paid to the Department.
    (c) Monthly Payments: Returns. Every employer required to deduct and withhold tax under this Act shall, on or before the 15th day of the second and third months of each calendar quarter, and on or before the last day of the month following the last month of each such quarter, pay to the Department or to a depositary designated by the Department, pursuant to regulations prescribed by the Department, the taxes so required to be deducted and withheld, whenever the aggregate amount withheld by such employer (together with amounts previously withheld and not paid to the Department) exceeds $500 but does not exceed $1,000. Every such employer shall for each calendar quarter, on or before the last day of the first month following the close of such quarter, and for the calendar year, on or before January 31 of the succeeding calendar year, make a return with respect to such taxes in such form and manner as the Department may by regulations prescribe, and pay to the Department or to a depositary designated by the Department all withheld taxes not previously paid to the Department.
    (d) Annual Payments: Returns. Where the amount of compensation paid by an employer is not sufficient to require the withholding of tax from the compensation of any of its employees (or where the aggregate amount withheld is less than $500), the Department may by regulation permit such employer to file only an annual return and to pay the taxes required to be deducted and withheld at the time of filing such annual return.
    (e) Annual Return. The Department may, as it deems appropriate, prescribe by regulation for the filing of annual returns in lieu of quarterly returns described in subsections (b) and (c).
    (e-5) Annual Return and Payment. On and after January 1, 1998, notwithstanding subsections (b) through (d) of this Section, every employer who deducts and withholds or is required to deduct and withhold tax from a person engaged in domestic service employment, as that term is defined in Section 3510 of the Internal Revenue Code, may comply with the requirements of this Section by filing an annual return and paying the taxes required to be deducted and withheld on or before the 15th day of the fourth month following the close of the employer's taxable year. The annual return may be submitted with the employer's individual income tax return.
    (f) Magnetic Media Filing. Forms W-2 that, pursuant to the Internal Revenue Code and regulations promulgated thereunder, are required to be submitted to the Internal Revenue Service on magnetic media, must also be submitted to the Department on magnetic media for Illinois purposes, if required by the Department.
(Source: P.A. 95-8, eff. 6-29-07.)

35 ILCS 5/704A

    (35 ILCS 5/704A)
    Sec. 704A. Employer's return and payment of tax withheld.
    (a) In general, every employer who deducts and withholds or is required to deduct and withhold tax under this Act on or after January 1, 2008 shall make those payments and returns as provided in this Section.
    (b) Returns. Every employer shall, in the form and manner required by the Department, make returns with respect to taxes withheld or required to be withheld under this Article 7 for each quarter beginning on or after January 1, 2008, on or before the last day of the first month following the close of that quarter.
    (c) Payments. With respect to amounts withheld or required to be withheld on or after January 1, 2008:
        (1) Semi-weekly payments. For each calendar year,
    
each employer who withheld or was required to withhold more than $12,000 during the one-year period ending on June 30 of the immediately preceding calendar year, payment must be made:
            (A) on or before each Friday of the calendar
        
year, for taxes withheld or required to be withheld on the immediately preceding Saturday, Sunday, Monday, or Tuesday;
            (B) on or before each Wednesday of the calendar
        
year, for taxes withheld or required to be withheld on the immediately preceding Wednesday, Thursday, or Friday.
        Beginning with calendar year 2011, payments made
    
under this paragraph (1) of subsection (c) must be made by electronic funds transfer.
        (2) Semi-weekly payments. Any employer who withholds
    
or is required to withhold more than $12,000 in any quarter of a calendar year is required to make payments on the dates set forth under item (1) of this subsection (c) for each remaining quarter of that calendar year and for the subsequent calendar year.
        (3) Monthly payments. Each employer, other than an
    
employer described in items (1) or (2) of this subsection, shall pay to the Department, on or before the 15th day of each month the taxes withheld or required to be withheld during the immediately preceding month.
        (4) Payments with returns. Each employer shall pay to
    
the Department, on or before the due date for each return required to be filed under this Section, any tax withheld or required to be withheld during the period for which the return is due and not previously paid to the Department.
    (d) Regulatory authority. The Department may, by rule:
        (1) Permit employers, in lieu of the requirements of
    
subsections (b) and (c), to file annual returns due on or before January 31 of the year for taxes withheld or required to be withheld during the previous calendar year and, if the aggregate amounts required to be withheld by the employer under this Article 7 (other than amounts required to be withheld under Section 709.5) do not exceed $1,000 for the previous calendar year, to pay the taxes required to be shown on each such return no later than the due date for such return.
        (2) Provide that any payment required to be made
    
under subsection (c)(1) or (c)(2) is deemed to be timely to the extent paid by electronic funds transfer on or before the due date for deposit of federal income taxes withheld from, or federal employment taxes due with respect to, the wages from which the Illinois taxes were withheld.
        (3) Designate one or more depositories to which
    
payment of taxes required to be withheld under this Article 7 must be paid by some or all employers.
        (4) Increase the threshold dollar amounts at which
    
employers are required to make semi-weekly payments under subsection (c)(1) or (c)(2).
    (e) Annual return and payment. Every employer who deducts and withholds or is required to deduct and withhold tax from a person engaged in domestic service employment, as that term is defined in Section 3510 of the Internal Revenue Code, may comply with the requirements of this Section with respect to such employees by filing an annual return and paying the taxes required to be deducted and withheld on or before the 15th day of the fourth month following the close of the employer's taxable year. The Department may allow the employer's return to be submitted with the employer's individual income tax return or to be submitted with a return due from the employer under Section 1400.2 of the Unemployment Insurance Act.
    (f) Magnetic media and electronic filing. Any W-2 Form that, under the Internal Revenue Code and regulations promulgated thereunder, is required to be submitted to the Internal Revenue Service on magnetic media or electronically must also be submitted to the Department on magnetic media or electronically for Illinois purposes, if required by the Department.
    (g) For amounts deducted or withheld after December 31, 2009, a taxpayer who makes an election under subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act for a taxable year shall be allowed a credit against payments due under this Section for amounts withheld during the first calendar year beginning after the end of that taxable year equal to the amount of the credit for the incremental income tax attributable to full-time employees of the taxpayer awarded to the taxpayer by the Department of Commerce and Economic Opportunity under the Economic Development for a Growing Economy Tax Credit Act for the taxable year and credits not previously claimed and allowed to be carried forward under Section 211(4) of this Act as provided in subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act. The credit or credits may not reduce the taxpayer's obligation for any payment due under this Section to less than zero. If the amount of the credit or credits exceeds the total payments due under this Section with respect to amounts withheld during the calendar year, the excess may be carried forward and applied against the taxpayer's liability under this Section in the succeeding calendar years as allowed to be carried forward under paragraph (4) of Section 211 of this Act. The credit or credits shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one taxable year that are available to offset a liability, the earlier credit shall be applied first. Each employer who deducts and withholds or is required to deduct and withhold tax under this Act and who retains income tax withholdings under subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act must make a return with respect to such taxes and retained amounts in the form and manner that the Department, by rule, requires and pay to the Department or to a depositary designated by the Department those withheld taxes not retained by the taxpayer. For purposes of this subsection (g), the term taxpayer shall include taxpayer and members of the taxpayer's unitary business group as defined under paragraph (27) of subsection (a) of Section 1501 of this Act. This Section is exempt from the provisions of Section 250 of this Act.
    (h) An employer may claim a credit against payments due under this Section for amounts withheld during the first calendar year ending after the date on which a tax credit certificate was issued under Section 35 of the Small Business Job Creation Tax Credit Act. The credit shall be equal to the amount shown on the certificate, but may not reduce the taxpayer's obligation for any payment due under this Section to less than zero. If the amount of the credit exceeds the total payments due under this Section with respect to amounts withheld during the calendar year, the excess may be carried forward and applied against the taxpayer's liability under this Section in the 5 succeeding calendar years. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one calendar year that are available to offset a liability, the earlier credit shall be applied first. This Section is exempt from the provisions of Section 250 of this Act.
(Source: P.A. 96-834, eff. 12-14-09; 96-888, eff. 4-13-10; 96-905, eff. 6-4-10; 96-1027, eff. 7-12-10; 97-333, eff. 8-12-11; 97-507, eff. 8-23-11.)

35 ILCS 5/705

    (35 ILCS 5/705) (from Ch. 120, par. 7-705)
    Sec. 705. Employer's Liability for Withheld Taxes. Every employer who deducts and withholds or is required to deduct and withhold tax under this Act is liable for such tax. For purposes of assessment and collection, any amount withheld or required to be withheld and paid over to the Department, and any penalties and interest with respect thereto, shall be considered the tax of the employer. Any amount of tax actually deducted and withheld under this Act shall be held to be a special fund in trust for the Department. No employee shall have any right of action against his employer in respect of any money deducted and withheld from his wages and paid over to the Department in compliance or in intended compliance with this Act.
(Source: P.A. 82-1009.)

35 ILCS 5/706

    (35 ILCS 5/706) (from Ch. 120, par. 7-706)
    Sec. 706. Employer's Failure to Withhold.
    If an employer fails to deduct and withhold any amount of tax as required under this Act, and thereafter the tax on account of which such amount was required to be deducted and withheld is paid, such amount of tax shall not be collected from the employer, but the employer shall not be relieved from liability for penalties or interest otherwise applicable in respect of such failure to deduct and withhold.
(Source: P.A. 76-261.)

35 ILCS 5/707

    (35 ILCS 5/707) (from Ch. 120, par. 7-707)
    Sec. 707. Governmental Employers.
    If the employer is the United States, or a state, Territory, or political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing, the return of the amount deducted and withheld upon any compensation may be made by any officer or employee of the United States, or of such state, Territory, or political subdivision, or of the District of Columbia, or of such agency or instrumentality, as the case may be, having control of the payment of such compensation, or appropriately designated for that purpose.
(Source: P.A. 76-261.)

35 ILCS 5/709.5

    (35 ILCS 5/709.5)
    Sec. 709.5. Withholding by partnerships, Subchapter S corporations, and trusts.
    (a) In general. For each taxable year ending on or after December 31, 2008, every partnership (other than a publicly traded partnership under Section 7704 of the Internal Revenue Code or investment partnership), Subchapter S corporation, and trust must withhold from each nonresident partner, shareholder, or beneficiary (other than a partner, shareholder, or beneficiary who is exempt from tax under Section 501(a) of the Internal Revenue Code or under Section 205 of this Act, who is included on a composite return filed by the partnership or Subchapter S corporation for the taxable year under subsection (f) of Section 502 of this Act), or who is a retired partner, to the extent that partner's distributions are exempt from tax under Section 203(a)(2)(F) of this Act) an amount equal to the sum of (i) the share of business income of the partnership, Subchapter S corporation, or trust apportionable to Illinois plus (ii) for taxable years ending on or after December 31, 2014, the share of nonbusiness income of the partnership, Subchapter S corporation, or trust allocated to Illinois under Section 303 of this Act (other than an amount allocated to the commercial domicile of the taxpayer under Section 303 of this Act) that is distributable to that partner, shareholder, or beneficiary under Sections 702 and 704 and Subchapter S of the Internal Revenue Code, whether or not distributed, (iii) multiplied by the applicable rates of tax for that partner, shareholder, or beneficiary under subsections (a) through (d) of Section 201 of this Act, and (iv) net of the share of any credit under Article 2 of this Act that is distributable by the partnership, Subchapter S corporation, or trust and allowable against the tax liability of that partner, shareholder, or beneficiary for a taxable year ending on or after December 31, 2014.
    (b) Credit for taxes withheld. Any amount withheld under subsection (a) of this Section and paid to the Department shall be treated as a payment of the estimated tax liability or of the liability for withholding under this Section of the partner, shareholder, or beneficiary to whom the income is distributable for the taxable year in which that person incurred a liability under this Act with respect to that income. The Department shall adopt rules pursuant to which a partner, shareholder, or beneficiary may claim a credit against its obligation for withholding under this Section for amounts withheld under this Section with respect to income distributable to it by a partnership, Subchapter S corporation, or trust and allowing its partners, shareholders, or beneficiaries to claim a credit under this subsection (b) for those withheld amounts.
    (c) Exemption from withholding.
        (1) A partnership, Subchapter S corporation, or trust
    
shall not be required to withhold tax under subsection (a) of this Section with respect to any nonresident partner, shareholder, or beneficiary (other than an individual) from whom the partnership, S corporation, or trust has received a certificate, completed in the form and manner prescribed by the Department, stating that such nonresident partner, shareholder, or beneficiary shall:
            (A) file all returns that the partner,
        
shareholder, or beneficiary is required to file under Section 502 of this Act and make timely payment of all taxes imposed under Section 201 of this Act or under this Section on the partner, shareholder, or beneficiary with respect to income of the partnership, S corporation, or trust; and
            (B) be subject to personal jurisdiction in this
        
State for purposes of the collection of income taxes, together with related interest and penalties, imposed on the partner, shareholder, or beneficiary with respect to the income of the partnership, S corporation, or trust.
        (2) The Department may revoke the exemption provided
    
by this subsection (c) at any time that it determines that the nonresident partner, shareholder, or beneficiary is not abiding by the terms of the certificate. The Department shall notify the partnership, S corporation, or trust that it has revoked a certificate by notice left at the usual place of business of the partnership, S corporation, or trust or by mail to the last known address of the partnership, S corporation, or trust.
        (3) A partnership, S corporation, or trust that
    
receives a certificate under this subsection (c) properly completed by a nonresident partner, shareholder, or beneficiary shall not be required to withhold any amount from that partner, shareholder, or beneficiary, the payment of which would be due under Section 711(a-5) of this Act after the receipt of the certificate and no earlier than 60 days after the Department has notified the partnership, S corporation, or trust that the certificate has been revoked.
        (4) Certificates received by a the partnership, S
    
corporation, or trust under this subsection (c) must be retained by the partnership, S corporation, or trust and a record of such certificates must be provided to the Department, in a format in which the record is available for review by the Department, upon request by the Department. The Department may, by rule, require the record of certificates to be maintained and provided to the Department electronically.
(Source: P.A. 97-507, eff. 8-23-11; 98-478, eff. 1-1-14.)

35 ILCS 5/710

    (35 ILCS 5/710) (from Ch. 120, par. 7-710)
    Sec. 710. Withholding from lottery winnings.
    (a) In general.
        (1) Any person making a payment to a resident or
    
nonresident of winnings under the Illinois Lottery Law and not required to withhold Illinois income tax from such payment under Subsection (b) of Section 701 of this Act because those winnings are not subject to Federal income tax withholding, must withhold Illinois income tax from such payment at a rate equal to the percentage tax rate for individuals provided in subsection (b) of Section 201, provided that withholding is not required if such payment of winnings is less than $1,000.
        (2) In the case of an assignment of a lottery prize
    
under Section 13.1 of the Illinois Lottery Law, any person making a payment of the purchase price after December 31, 2013, shall withhold from the