101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB1550

 

Introduced 2/15/2019, by Sen. Donald P. DeWitte

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/901  from Ch. 120, par. 9-901

    Amends the Illinois Income Tax Act. Provides that an amount equal to 10% of the net revenue realized from the State income tax during the preceding month shall be transferred from the General Revenue Fund to the Local Government Distributive Fund (currently, the amount transferred is equal to the sum of (i) 6.06% of the net revenue realized from the tax imposed upon individuals, trusts, and estates and (ii) 6.85% of the net revenue realized from the tax imposed upon corporations).


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB1550LRB101 09660 HLH 54759 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5changing Section 901 as follows:
 
6    (35 ILCS 5/901)  (from Ch. 120, par. 9-901)
7    Sec. 901. Collection authority.
8    (a) In general. The Department shall collect the taxes
9imposed by this Act. The Department shall collect certified
10past due child support amounts under Section 2505-650 of the
11Department of Revenue Law of the Civil Administrative Code of
12Illinois. Except as provided in subsections (b), (c), (e), (f),
13(g), and (h) of this Section, money collected pursuant to
14subsections (a) and (b) of Section 201 of this Act shall be
15paid into the General Revenue Fund in the State treasury; money
16collected pursuant to subsections (c) and (d) of Section 201 of
17this Act shall be paid into the Personal Property Tax
18Replacement Fund, a special fund in the State Treasury; and
19money collected under Section 2505-650 of the Department of
20Revenue Law of the Civil Administrative Code of Illinois shall
21be paid into the Child Support Enforcement Trust Fund, a
22special fund outside the State Treasury, or to the State
23Disbursement Unit established under Section 10-26 of the

 

 

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1Illinois Public Aid Code, as directed by the Department of
2Healthcare and Family Services.
3    (b) Local Government Distributive Fund. Beginning August
41, 1969, and continuing through June 30, 1994, the Treasurer
5shall transfer each month from the General Revenue Fund to a
6special fund in the State treasury, to be known as the "Local
7Government Distributive Fund", an amount equal to 1/12 of the
8net revenue realized from the tax imposed by subsections (a)
9and (b) of Section 201 of this Act during the preceding month.
10Beginning July 1, 1994, and continuing through June 30, 1995,
11the Treasurer shall transfer each month from the General
12Revenue Fund to the Local Government Distributive Fund an
13amount equal to 1/11 of the net revenue realized from the tax
14imposed by subsections (a) and (b) of Section 201 of this Act
15during the preceding month. Beginning July 1, 1995 and
16continuing through January 31, 2011, the Treasurer shall
17transfer each month from the General Revenue Fund to the Local
18Government Distributive Fund an amount equal to the net of (i)
191/10 of the net revenue realized from the tax imposed by
20subsections (a) and (b) of Section 201 of the Illinois Income
21Tax Act during the preceding month (ii) minus, beginning July
221, 2003 and ending June 30, 2004, $6,666,666, and beginning
23July 1, 2004, zero. Beginning February 1, 2011, and continuing
24through January 31, 2015, the Treasurer shall transfer each
25month from the General Revenue Fund to the Local Government
26Distributive Fund an amount equal to the sum of (i) 6% (10% of

 

 

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1the ratio of the 3% individual income tax rate prior to 2011 to
2the 5% individual income tax rate after 2010) of the net
3revenue realized from the tax imposed by subsections (a) and
4(b) of Section 201 of this Act upon individuals, trusts, and
5estates during the preceding month and (ii) 6.86% (10% of the
6ratio of the 4.8% corporate income tax rate prior to 2011 to
7the 7% corporate income tax rate after 2010) of the net revenue
8realized from the tax imposed by subsections (a) and (b) of
9Section 201 of this Act upon corporations during the preceding
10month. Beginning February 1, 2015 and continuing through July
1131, 2017, the Treasurer shall transfer each month from the
12General Revenue Fund to the Local Government Distributive Fund
13an amount equal to the sum of (i) 8% (10% of the ratio of the 3%
14individual income tax rate prior to 2011 to the 3.75%
15individual income tax rate after 2014) of the net revenue
16realized from the tax imposed by subsections (a) and (b) of
17Section 201 of this Act upon individuals, trusts, and estates
18during the preceding month and (ii) 9.14% (10% of the ratio of
19the 4.8% corporate income tax rate prior to 2011 to the 5.25%
20corporate income tax rate after 2014) of the net revenue
21realized from the tax imposed by subsections (a) and (b) of
22Section 201 of this Act upon corporations during the preceding
23month. Beginning August 1, 2017 and continuing through July 31,
242019, the Treasurer shall transfer each month from the General
25Revenue Fund to the Local Government Distributive Fund an
26amount equal to the sum of (i) 6.06% (10% of the ratio of the 3%

 

 

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1individual income tax rate prior to 2011 to the 4.95%
2individual income tax rate after July 1, 2017) of the net
3revenue realized from the tax imposed by subsections (a) and
4(b) of Section 201 of this Act upon individuals, trusts, and
5estates during the preceding month and (ii) 6.85% (10% of the
6ratio of the 4.8% corporate income tax rate prior to 2011 to
7the 7% corporate income tax rate after July 1, 2017) of the net
8revenue realized from the tax imposed by subsections (a) and
9(b) of Section 201 of this Act upon corporations during the
10preceding month. Beginning August 1, 2019, the Treasurer shall
11transfer each month from the General Revenue Fund to the Local
12Government Distributive Fund an amount equal to 10% of the net
13revenue realized from the tax imposed by subsections (a) and
14(b) of Section 201 of the Illinois Income Tax Act during the
15preceding month. Net revenue realized for a month shall be
16defined as the revenue from the tax imposed by subsections (a)
17and (b) of Section 201 of this Act which is deposited in the
18General Revenue Fund, the Education Assistance Fund, the Income
19Tax Surcharge Local Government Distributive Fund, the Fund for
20the Advancement of Education, and the Commitment to Human
21Services Fund during the month minus the amount paid out of the
22General Revenue Fund in State warrants during that same month
23as refunds to taxpayers for overpayment of liability under the
24tax imposed by subsections (a) and (b) of Section 201 of this
25Act.
26    Notwithstanding any provision of law to the contrary,

 

 

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1beginning on July 6, 2017 (the effective date of Public Act
2100-23), those amounts required under this subsection (b) to be
3transferred by the Treasurer into the Local Government
4Distributive Fund from the General Revenue Fund shall be
5directly deposited into the Local Government Distributive Fund
6as the revenue is realized from the tax imposed by subsections
7(a) and (b) of Section 201 of this Act.
8    For State fiscal year 2018 only, notwithstanding any
9provision of law to the contrary, the total amount of revenue
10and deposits under this Section attributable to revenues
11realized during State fiscal year 2018 shall be reduced by 10%.
12    For State fiscal year 2019 only, notwithstanding any
13provision of law to the contrary, the total amount of revenue
14and deposits under this Section attributable to revenues
15realized during State fiscal year 2019 shall be reduced by 5%.
16    (c) Deposits Into Income Tax Refund Fund.
17        (1) Beginning on January 1, 1989 and thereafter, the
18    Department shall deposit a percentage of the amounts
19    collected pursuant to subsections (a) and (b)(1), (2), and
20    (3) of Section 201 of this Act into a fund in the State
21    treasury known as the Income Tax Refund Fund. The
22    Department shall deposit 6% of such amounts during the
23    period beginning January 1, 1989 and ending on June 30,
24    1989. Beginning with State fiscal year 1990 and for each
25    fiscal year thereafter, the percentage deposited into the
26    Income Tax Refund Fund during a fiscal year shall be the

 

 

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1    Annual Percentage. For fiscal years 1999 through 2001, the
2    Annual Percentage shall be 7.1%. For fiscal year 2003, the
3    Annual Percentage shall be 8%. For fiscal year 2004, the
4    Annual Percentage shall be 11.7%. Upon the effective date
5    of Public Act 93-839 (July 30, 2004), the Annual Percentage
6    shall be 10% for fiscal year 2005. For fiscal year 2006,
7    the Annual Percentage shall be 9.75%. For fiscal year 2007,
8    the Annual Percentage shall be 9.75%. For fiscal year 2008,
9    the Annual Percentage shall be 7.75%. For fiscal year 2009,
10    the Annual Percentage shall be 9.75%. For fiscal year 2010,
11    the Annual Percentage shall be 9.75%. For fiscal year 2011,
12    the Annual Percentage shall be 8.75%. For fiscal year 2012,
13    the Annual Percentage shall be 8.75%. For fiscal year 2013,
14    the Annual Percentage shall be 9.75%. For fiscal year 2014,
15    the Annual Percentage shall be 9.5%. For fiscal year 2015,
16    the Annual Percentage shall be 10%. For fiscal year 2018,
17    the Annual Percentage shall be 9.8%. For fiscal year 2019,
18    the Annual Percentage shall be 9.7%. For all other fiscal
19    years, the Annual Percentage shall be calculated as a
20    fraction, the numerator of which shall be the amount of
21    refunds approved for payment by the Department during the
22    preceding fiscal year as a result of overpayment of tax
23    liability under subsections (a) and (b)(1), (2), and (3) of
24    Section 201 of this Act plus the amount of such refunds
25    remaining approved but unpaid at the end of the preceding
26    fiscal year, minus the amounts transferred into the Income

 

 

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1    Tax Refund Fund from the Tobacco Settlement Recovery Fund,
2    and the denominator of which shall be the amounts which
3    will be collected pursuant to subsections (a) and (b)(1),
4    (2), and (3) of Section 201 of this Act during the
5    preceding fiscal year; except that in State fiscal year
6    2002, the Annual Percentage shall in no event exceed 7.6%.
7    The Director of Revenue shall certify the Annual Percentage
8    to the Comptroller on the last business day of the fiscal
9    year immediately preceding the fiscal year for which it is
10    to be effective.
11        (2) Beginning on January 1, 1989 and thereafter, the
12    Department shall deposit a percentage of the amounts
13    collected pursuant to subsections (a) and (b)(6), (7), and
14    (8), (c) and (d) of Section 201 of this Act into a fund in
15    the State treasury known as the Income Tax Refund Fund. The
16    Department shall deposit 18% of such amounts during the
17    period beginning January 1, 1989 and ending on June 30,
18    1989. Beginning with State fiscal year 1990 and for each
19    fiscal year thereafter, the percentage deposited into the
20    Income Tax Refund Fund during a fiscal year shall be the
21    Annual Percentage. For fiscal years 1999, 2000, and 2001,
22    the Annual Percentage shall be 19%. For fiscal year 2003,
23    the Annual Percentage shall be 27%. For fiscal year 2004,
24    the Annual Percentage shall be 32%. Upon the effective date
25    of Public Act 93-839 (July 30, 2004), the Annual Percentage
26    shall be 24% for fiscal year 2005. For fiscal year 2006,

 

 

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1    the Annual Percentage shall be 20%. For fiscal year 2007,
2    the Annual Percentage shall be 17.5%. For fiscal year 2008,
3    the Annual Percentage shall be 15.5%. For fiscal year 2009,
4    the Annual Percentage shall be 17.5%. For fiscal year 2010,
5    the Annual Percentage shall be 17.5%. For fiscal year 2011,
6    the Annual Percentage shall be 17.5%. For fiscal year 2012,
7    the Annual Percentage shall be 17.5%. For fiscal year 2013,
8    the Annual Percentage shall be 14%. For fiscal year 2014,
9    the Annual Percentage shall be 13.4%. For fiscal year 2015,
10    the Annual Percentage shall be 14%. For fiscal year 2018,
11    the Annual Percentage shall be 17.5%. For fiscal year 2019,
12    the Annual Percentage shall be 15.5%. For all other fiscal
13    years, the Annual Percentage shall be calculated as a
14    fraction, the numerator of which shall be the amount of
15    refunds approved for payment by the Department during the
16    preceding fiscal year as a result of overpayment of tax
17    liability under subsections (a) and (b)(6), (7), and (8),
18    (c) and (d) of Section 201 of this Act plus the amount of
19    such refunds remaining approved but unpaid at the end of
20    the preceding fiscal year, and the denominator of which
21    shall be the amounts which will be collected pursuant to
22    subsections (a) and (b)(6), (7), and (8), (c) and (d) of
23    Section 201 of this Act during the preceding fiscal year;
24    except that in State fiscal year 2002, the Annual
25    Percentage shall in no event exceed 23%. The Director of
26    Revenue shall certify the Annual Percentage to the

 

 

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1    Comptroller on the last business day of the fiscal year
2    immediately preceding the fiscal year for which it is to be
3    effective.
4        (3) The Comptroller shall order transferred and the
5    Treasurer shall transfer from the Tobacco Settlement
6    Recovery Fund to the Income Tax Refund Fund (i) $35,000,000
7    in January, 2001, (ii) $35,000,000 in January, 2002, and
8    (iii) $35,000,000 in January, 2003.
9    (d) Expenditures from Income Tax Refund Fund.
10        (1) Beginning January 1, 1989, money in the Income Tax
11    Refund Fund shall be expended exclusively for the purpose
12    of paying refunds resulting from overpayment of tax
13    liability under Section 201 of this Act and for making
14    transfers pursuant to this subsection (d).
15        (2) The Director shall order payment of refunds
16    resulting from overpayment of tax liability under Section
17    201 of this Act from the Income Tax Refund Fund only to the
18    extent that amounts collected pursuant to Section 201 of
19    this Act and transfers pursuant to this subsection (d) and
20    item (3) of subsection (c) have been deposited and retained
21    in the Fund.
22        (3) As soon as possible after the end of each fiscal
23    year, the Director shall order transferred and the State
24    Treasurer and State Comptroller shall transfer from the
25    Income Tax Refund Fund to the Personal Property Tax
26    Replacement Fund an amount, certified by the Director to

 

 

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1    the Comptroller, equal to the excess of the amount
2    collected pursuant to subsections (c) and (d) of Section
3    201 of this Act deposited into the Income Tax Refund Fund
4    during the fiscal year over the amount of refunds resulting
5    from overpayment of tax liability under subsections (c) and
6    (d) of Section 201 of this Act paid from the Income Tax
7    Refund Fund during the fiscal year.
8        (4) As soon as possible after the end of each fiscal
9    year, the Director shall order transferred and the State
10    Treasurer and State Comptroller shall transfer from the
11    Personal Property Tax Replacement Fund to the Income Tax
12    Refund Fund an amount, certified by the Director to the
13    Comptroller, equal to the excess of the amount of refunds
14    resulting from overpayment of tax liability under
15    subsections (c) and (d) of Section 201 of this Act paid
16    from the Income Tax Refund Fund during the fiscal year over
17    the amount collected pursuant to subsections (c) and (d) of
18    Section 201 of this Act deposited into the Income Tax
19    Refund Fund during the fiscal year.
20        (4.5) As soon as possible after the end of fiscal year
21    1999 and of each fiscal year thereafter, the Director shall
22    order transferred and the State Treasurer and State
23    Comptroller shall transfer from the Income Tax Refund Fund
24    to the General Revenue Fund any surplus remaining in the
25    Income Tax Refund Fund as of the end of such fiscal year;
26    excluding for fiscal years 2000, 2001, and 2002 amounts

 

 

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1    attributable to transfers under item (3) of subsection (c)
2    less refunds resulting from the earned income tax credit.
3        (5) This Act shall constitute an irrevocable and
4    continuing appropriation from the Income Tax Refund Fund
5    for the purpose of paying refunds upon the order of the
6    Director in accordance with the provisions of this Section.
7    (e) Deposits into the Education Assistance Fund and the
8Income Tax Surcharge Local Government Distributive Fund. On
9July 1, 1991, and thereafter, of the amounts collected pursuant
10to subsections (a) and (b) of Section 201 of this Act, minus
11deposits into the Income Tax Refund Fund, the Department shall
12deposit 7.3% into the Education Assistance Fund in the State
13Treasury. Beginning July 1, 1991, and continuing through
14January 31, 1993, of the amounts collected pursuant to
15subsections (a) and (b) of Section 201 of the Illinois Income
16Tax Act, minus deposits into the Income Tax Refund Fund, the
17Department shall deposit 3.0% into the Income Tax Surcharge
18Local Government Distributive Fund in the State Treasury.
19Beginning February 1, 1993 and continuing through June 30,
201993, of the amounts collected pursuant to subsections (a) and
21(b) of Section 201 of the Illinois Income Tax Act, minus
22deposits into the Income Tax Refund Fund, the Department shall
23deposit 4.4% into the Income Tax Surcharge Local Government
24Distributive Fund in the State Treasury. Beginning July 1,
251993, and continuing through June 30, 1994, of the amounts
26collected under subsections (a) and (b) of Section 201 of this

 

 

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1Act, minus deposits into the Income Tax Refund Fund, the
2Department shall deposit 1.475% into the Income Tax Surcharge
3Local Government Distributive Fund in the State Treasury.
4    (f) Deposits into the Fund for the Advancement of
5Education. Beginning February 1, 2015, the Department shall
6deposit the following portions of the revenue realized from the
7tax imposed upon individuals, trusts, and estates by
8subsections (a) and (b) of Section 201 of this Act, minus
9deposits into the Income Tax Refund Fund, into the Fund for the
10Advancement of Education:
11        (1) beginning February 1, 2015, and prior to February
12    1, 2025, 1/30; and
13        (2) beginning February 1, 2025, 1/26.
14    If the rate of tax imposed by subsection (a) and (b) of
15Section 201 is reduced pursuant to Section 201.5 of this Act,
16the Department shall not make the deposits required by this
17subsection (f) on or after the effective date of the reduction.
18    (g) Deposits into the Commitment to Human Services Fund.
19Beginning February 1, 2015, the Department shall deposit the
20following portions of the revenue realized from the tax imposed
21upon individuals, trusts, and estates by subsections (a) and
22(b) of Section 201 of this Act, minus deposits into the Income
23Tax Refund Fund, into the Commitment to Human Services Fund:
24        (1) beginning February 1, 2015, and prior to February
25    1, 2025, 1/30; and
26        (2) beginning February 1, 2025, 1/26.

 

 

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1    If the rate of tax imposed by subsection (a) and (b) of
2Section 201 is reduced pursuant to Section 201.5 of this Act,
3the Department shall not make the deposits required by this
4subsection (g) on or after the effective date of the reduction.
5    (h) Deposits into the Tax Compliance and Administration
6Fund. Beginning on the first day of the first calendar month to
7occur on or after August 26, 2014 (the effective date of Public
8Act 98-1098), each month the Department shall pay into the Tax
9Compliance and Administration Fund, to be used, subject to
10appropriation, to fund additional auditors and compliance
11personnel at the Department, an amount equal to 1/12 of 5% of
12the cash receipts collected during the preceding fiscal year by
13the Audit Bureau of the Department from the tax imposed by
14subsections (a), (b), (c), and (d) of Section 201 of this Act,
15net of deposits into the Income Tax Refund Fund made from those
16cash receipts.
17(Source: P.A. 99-78, eff. 7-20-15; 100-22, eff. 7-6-17; 100-23,
18eff. 7-6-17; 100-587, eff. 6-4-18; 100-621, eff. 7-20-18;
19100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; revised 1-8-19.)