101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB2542

 

Introduced , by Rep. Sonya M. Harper

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/216

    Amends the Illinois Income Tax Act. In a Section concerning the credit for wages paid to ex-felons, provides that, if the taxpayer is a business located in a census tract with a high rate of unemployment and violent crime, then (i) the amount of the credit shall be 10% (currently, 5%) of qualified wages paid by the taxpayer during the taxable year to the qualified ex-offender and (ii) the total credit allowed to that taxpayer with respect to each qualified ex-offender may not exceed $3,000 (currently, $1,500) for all taxable years. Provides that, in the case of those taxpayers, the requirement that the ex-felon must be hired by the taxpayer within 3 years after being released from an Illinois adult correctional center does not apply. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5changing Section 216 as follows:
 
6    (35 ILCS 5/216)
7    Sec. 216. Credit for wages paid to ex-felons.
8    (a) For each taxable year beginning on or after January 1,
92007, each taxpayer is entitled to a credit against the tax
10imposed by subsections (a) and (b) of Section 201 of this Act
11in an amount equal to 5% of qualified wages paid by the
12taxpayer during the taxable year to one or more Illinois
13residents who are qualified ex-offenders. The total credit
14allowed to a taxpayer with respect to each qualified
15ex-offender may not exceed $1,500 for all taxable years.
16Notwithstanding the provisions of this subsection (a), for
17taxable years beginning on or after January 1, 2019, if the
18taxpayer is a business located in a census tract with a high
19rate of unemployment and violent crime, according to rules
20adopted by the Department of Commerce and Economic Opportunity,
21then (i) the amount of the credit shall be 10% of qualified
22wages paid by the taxpayer during the taxable year to one or
23more Illinois residents who are qualified ex-offenders and (ii)

 

 

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1the total credit allowed to that taxpayer with respect to each
2qualified ex-offender may not exceed $3,000 for all taxable
3years. For partners, shareholders of Subchapter S
4corporations, and owners of limited liability companies, if the
5liability company is treated as a partnership for purposes of
6federal and State income taxation, there shall be allowed a
7credit under this Section to be determined in accordance with
8the determination of income and distributive share of income
9under Sections 702 and 704 and Subchapter S of the Internal
10Revenue Code.
11    (b) For purposes of this Section, "qualified wages":
12        (1) includes only wages that are subject to federal
13    unemployment tax under Section 3306 of the Internal Revenue
14    Code, without regard to any dollar limitation contained in
15    that Section;
16        (2) does not include any amounts paid or incurred by an
17    employer for any period to any qualified ex-offender for
18    whom the employer receives federally funded payments for
19    on-the-job training of that qualified ex-offender for that
20    period; and
21        (3) includes only wages attributable to service
22    rendered during the one-year period beginning with the day
23    the qualified ex-offender begins work for the employer.
24    If the taxpayer has received any payment from a program
25established under Section 482(e)(1) of the federal Social
26Security Act with respect to a qualified ex-offender, then, for

 

 

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1purposes of calculating the credit under this Section, the
2amount of the qualified wages paid to that qualified
3ex-offender must be reduced by the amount of the payment.
4    (c) For purposes of this Section, "qualified ex-offender"
5means any person who:
6        (1) has been convicted of a crime in this State or of
7    an offense in any other jurisdiction, not including any
8    offense or attempted offense that would subject a person to
9    registration under the Sex Offender Registration Act;
10        (2) was sentenced to a period of incarceration in an
11    Illinois adult correctional center; and
12        (3) was hired by the taxpayer within 3 years after
13    being released from an Illinois adult correctional center,
14    except that this subparagraph (3) does not apply to a
15    business located in a census tract with a high rate of
16    unemployment and violent crime, according to rules adopted
17    by the Department of Commerce and Economic Opportunity.
18    (d) In no event shall a credit under this Section reduce
19the taxpayer's liability to less than zero. If the amount of
20the credit exceeds the tax liability for the year, the excess
21may be carried forward and applied to the tax liability of the
225 taxable years following the excess credit year. The tax
23credit shall be applied to the earliest year for which there is
24a tax liability. If there are credits for more than one year
25that are available to offset a liability, the earlier credit
26shall be applied first.

 

 

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1    (e) This Section is exempt from the provisions of Section
2250.
3(Source: P.A. 98-165, eff. 8-5-13.)
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.