Rep. Michael J. Zalewski

Filed: 4/5/2022

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 1497

2    AMENDMENT NO. ______. Amend House Bill 1497 by replacing
3everything after the enacting clause with the following:
 
4
"ARTICLE 5. USE AND OCCUPATION TAX-EQUIPMENT

 
5    Section 5-5. The Use Tax Act is amended by changing
6Section 3-5 as follows:
 
7    (35 ILCS 105/3-5)
8    Sec. 3-5. Exemptions. Use of the following tangible
9personal property is exempt from the tax imposed by this Act:
10    (1) Personal property purchased from a corporation,
11society, association, foundation, institution, or
12organization, other than a limited liability company, that is
13organized and operated as a not-for-profit service enterprise
14for the benefit of persons 65 years of age or older if the
15personal property was not purchased by the enterprise for the

 

 

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1purpose of resale by the enterprise.
2    (2) Personal property purchased by a not-for-profit
3Illinois county fair association for use in conducting,
4operating, or promoting the county fair.
5    (3) Personal property purchased by a not-for-profit arts
6or cultural organization that establishes, by proof required
7by the Department by rule, that it has received an exemption
8under Section 501(c)(3) of the Internal Revenue Code and that
9is organized and operated primarily for the presentation or
10support of arts or cultural programming, activities, or
11services. These organizations include, but are not limited to,
12music and dramatic arts organizations such as symphony
13orchestras and theatrical groups, arts and cultural service
14organizations, local arts councils, visual arts organizations,
15and media arts organizations. On and after July 1, 2001 (the
16effective date of Public Act 92-35), however, an entity
17otherwise eligible for this exemption shall not make tax-free
18purchases unless it has an active identification number issued
19by the Department.
20    (4) Personal property purchased by a governmental body, by
21a corporation, society, association, foundation, or
22institution organized and operated exclusively for charitable,
23religious, or educational purposes, or by a not-for-profit
24corporation, society, association, foundation, institution, or
25organization that has no compensated officers or employees and
26that is organized and operated primarily for the recreation of

 

 

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1persons 55 years of age or older. A limited liability company
2may qualify for the exemption under this paragraph only if the
3limited liability company is organized and operated
4exclusively for educational purposes. On and after July 1,
51987, however, no entity otherwise eligible for this exemption
6shall make tax-free purchases unless it has an active
7exemption identification number issued by the Department.
8    (5) Until July 1, 2003, a passenger car that is a
9replacement vehicle to the extent that the purchase price of
10the car is subject to the Replacement Vehicle Tax.
11    (6) Until July 1, 2003 and beginning again on September 1,
122004 through August 30, 2014, graphic arts machinery and
13equipment, including repair and replacement parts, both new
14and used, and including that manufactured on special order,
15certified by the purchaser to be used primarily for graphic
16arts production, and including machinery and equipment
17purchased for lease. Equipment includes chemicals or chemicals
18acting as catalysts but only if the chemicals or chemicals
19acting as catalysts effect a direct and immediate change upon
20a graphic arts product. Beginning on July 1, 2017, graphic
21arts machinery and equipment is included in the manufacturing
22and assembling machinery and equipment exemption under
23paragraph (18).
24    (7) Farm chemicals.
25    (8) Legal tender, currency, medallions, or gold or silver
26coinage issued by the State of Illinois, the government of the

 

 

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1United States of America, or the government of any foreign
2country, and bullion.
3    (9) Personal property purchased from a teacher-sponsored
4student organization affiliated with an elementary or
5secondary school located in Illinois.
6    (10) A motor vehicle that is used for automobile renting,
7as defined in the Automobile Renting Occupation and Use Tax
8Act.
9    (11) Farm machinery and equipment, both new and used,
10including that manufactured on special order, certified by the
11purchaser to be used primarily for production agriculture or
12State or federal agricultural programs, including individual
13replacement parts for the machinery and equipment, including
14machinery and equipment purchased for lease, and including
15implements of husbandry defined in Section 1-130 of the
16Illinois Vehicle Code, farm machinery and agricultural
17chemical and fertilizer spreaders, and nurse wagons required
18to be registered under Section 3-809 of the Illinois Vehicle
19Code, but excluding other motor vehicles required to be
20registered under the Illinois Vehicle Code. Horticultural
21polyhouses or hoop houses used for propagating, growing, or
22overwintering plants shall be considered farm machinery and
23equipment under this item (11). Agricultural chemical tender
24tanks and dry boxes shall include units sold separately from a
25motor vehicle required to be licensed and units sold mounted
26on a motor vehicle required to be licensed if the selling price

 

 

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1of the tender is separately stated.
2    Farm machinery and equipment shall include precision
3farming equipment that is installed or purchased to be
4installed on farm machinery and equipment including, but not
5limited to, tractors, harvesters, sprayers, planters, seeders,
6or spreaders. Precision farming equipment includes, but is not
7limited to, soil testing sensors, computers, monitors,
8software, global positioning and mapping systems, and other
9such equipment.
10    Farm machinery and equipment also includes computers,
11sensors, software, and related equipment used primarily in the
12computer-assisted operation of production agriculture
13facilities, equipment, and activities such as, but not limited
14to, the collection, monitoring, and correlation of animal and
15crop data for the purpose of formulating animal diets and
16agricultural chemicals. This item (11) is exempt from the
17provisions of Section 3-90.
18    (12) Until June 30, 2013, fuel and petroleum products sold
19to or used by an air common carrier, certified by the carrier
20to be used for consumption, shipment, or storage in the
21conduct of its business as an air common carrier, for a flight
22destined for or returning from a location or locations outside
23the United States without regard to previous or subsequent
24domestic stopovers.
25    Beginning July 1, 2013, fuel and petroleum products sold
26to or used by an air carrier, certified by the carrier to be

 

 

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1used for consumption, shipment, or storage in the conduct of
2its business as an air common carrier, for a flight that (i) is
3engaged in foreign trade or is engaged in trade between the
4United States and any of its possessions and (ii) transports
5at least one individual or package for hire from the city of
6origination to the city of final destination on the same
7aircraft, without regard to a change in the flight number of
8that aircraft.
9    (13) Proceeds of mandatory service charges separately
10stated on customers' bills for the purchase and consumption of
11food and beverages purchased at retail from a retailer, to the
12extent that the proceeds of the service charge are in fact
13turned over as tips or as a substitute for tips to the
14employees who participate directly in preparing, serving,
15hosting or cleaning up the food or beverage function with
16respect to which the service charge is imposed.
17    (14) Until July 1, 2003, oil field exploration, drilling,
18and production equipment, including (i) rigs and parts of
19rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
20pipe and tubular goods, including casing and drill strings,
21(iii) pumps and pump-jack units, (iv) storage tanks and flow
22lines, (v) any individual replacement part for oil field
23exploration, drilling, and production equipment, and (vi)
24machinery and equipment purchased for lease; but excluding
25motor vehicles required to be registered under the Illinois
26Vehicle Code.

 

 

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1    (15) Photoprocessing machinery and equipment, including
2repair and replacement parts, both new and used, including
3that manufactured on special order, certified by the purchaser
4to be used primarily for photoprocessing, and including
5photoprocessing machinery and equipment purchased for lease.
6    (16) Coal Until July 1, 2023, coal and aggregate
7exploration, mining, off-highway hauling, processing,
8maintenance, and reclamation equipment, including replacement
9parts and equipment, and including equipment purchased for
10lease, but excluding motor vehicles required to be registered
11under the Illinois Vehicle Code. The changes made to this
12Section by Public Act 97-767 apply on and after July 1, 2003,
13but no claim for credit or refund is allowed on or after August
1416, 2013 (the effective date of Public Act 98-456) for such
15taxes paid during the period beginning July 1, 2003 and ending
16on August 16, 2013 (the effective date of Public Act 98-456).
17The exemption under this paragraph (16) for coal applies until
18July 1, 2023. The exemption under this paragraph (16) for
19aggregate exploration, mining, off-highway hauling,
20processing, maintenance, and reclamation equipment applies
21until July 1, 2028.
22    (17) Until July 1, 2003, distillation machinery and
23equipment, sold as a unit or kit, assembled or installed by the
24retailer, certified by the user to be used only for the
25production of ethyl alcohol that will be used for consumption
26as motor fuel or as a component of motor fuel for the personal

 

 

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1use of the user, and not subject to sale or resale.
2    (18) Manufacturing and assembling machinery and equipment
3used primarily in the process of manufacturing or assembling
4tangible personal property for wholesale or retail sale or
5lease, whether that sale or lease is made directly by the
6manufacturer or by some other person, whether the materials
7used in the process are owned by the manufacturer or some other
8person, or whether that sale or lease is made apart from or as
9an incident to the seller's engaging in the service occupation
10of producing machines, tools, dies, jigs, patterns, gauges, or
11other similar items of no commercial value on special order
12for a particular purchaser. The exemption provided by this
13paragraph (18) includes production related tangible personal
14property, as defined in Section 3-50, purchased on or after
15July 1, 2019. The exemption provided by this paragraph (18)
16does not include machinery and equipment used in (i) the
17generation of electricity for wholesale or retail sale; (ii)
18the generation or treatment of natural or artificial gas for
19wholesale or retail sale that is delivered to customers
20through pipes, pipelines, or mains; or (iii) the treatment of
21water for wholesale or retail sale that is delivered to
22customers through pipes, pipelines, or mains. The provisions
23of Public Act 98-583 are declaratory of existing law as to the
24meaning and scope of this exemption. Beginning on July 1,
252017, the exemption provided by this paragraph (18) includes,
26but is not limited to, graphic arts machinery and equipment,

 

 

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1as defined in paragraph (6) of this Section.
2    (19) Personal property delivered to a purchaser or
3purchaser's donee inside Illinois when the purchase order for
4that personal property was received by a florist located
5outside Illinois who has a florist located inside Illinois
6deliver the personal property.
7    (20) Semen used for artificial insemination of livestock
8for direct agricultural production.
9    (21) Horses, or interests in horses, registered with and
10meeting the requirements of any of the Arabian Horse Club
11Registry of America, Appaloosa Horse Club, American Quarter
12Horse Association, United States Trotting Association, or
13Jockey Club, as appropriate, used for purposes of breeding or
14racing for prizes. This item (21) is exempt from the
15provisions of Section 3-90, and the exemption provided for
16under this item (21) applies for all periods beginning May 30,
171995, but no claim for credit or refund is allowed on or after
18January 1, 2008 for such taxes paid during the period
19beginning May 30, 2000 and ending on January 1, 2008.
20    (22) Computers and communications equipment utilized for
21any hospital purpose and equipment used in the diagnosis,
22analysis, or treatment of hospital patients purchased by a
23lessor who leases the equipment, under a lease of one year or
24longer executed or in effect at the time the lessor would
25otherwise be subject to the tax imposed by this Act, to a
26hospital that has been issued an active tax exemption

 

 

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1identification number by the Department under Section 1g of
2the Retailers' Occupation Tax Act. If the equipment is leased
3in a manner that does not qualify for this exemption or is used
4in any other non-exempt manner, the lessor shall be liable for
5the tax imposed under this Act or the Service Use Tax Act, as
6the case may be, based on the fair market value of the property
7at the time the non-qualifying use occurs. No lessor shall
8collect or attempt to collect an amount (however designated)
9that purports to reimburse that lessor for the tax imposed by
10this Act or the Service Use Tax Act, as the case may be, if the
11tax has not been paid by the lessor. If a lessor improperly
12collects any such amount from the lessee, the lessee shall
13have a legal right to claim a refund of that amount from the
14lessor. If, however, that amount is not refunded to the lessee
15for any reason, the lessor is liable to pay that amount to the
16Department.
17    (23) Personal property purchased by a lessor who leases
18the property, under a lease of one year or longer executed or
19in effect at the time the lessor would otherwise be subject to
20the tax imposed by this Act, to a governmental body that has
21been issued an active sales tax exemption identification
22number by the Department under Section 1g of the Retailers'
23Occupation Tax Act. If the property is leased in a manner that
24does not qualify for this exemption or used in any other
25non-exempt manner, the lessor shall be liable for the tax
26imposed under this Act or the Service Use Tax Act, as the case

 

 

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1may be, based on the fair market value of the property at the
2time the non-qualifying use occurs. No lessor shall collect or
3attempt to collect an amount (however designated) that
4purports to reimburse that lessor for the tax imposed by this
5Act or the Service Use Tax Act, as the case may be, if the tax
6has not been paid by the lessor. If a lessor improperly
7collects any such amount from the lessee, the lessee shall
8have a legal right to claim a refund of that amount from the
9lessor. If, however, that amount is not refunded to the lessee
10for any reason, the lessor is liable to pay that amount to the
11Department.
12    (24) Beginning with taxable years ending on or after
13December 31, 1995 and ending with taxable years ending on or
14before December 31, 2004, personal property that is donated
15for disaster relief to be used in a State or federally declared
16disaster area in Illinois or bordering Illinois by a
17manufacturer or retailer that is registered in this State to a
18corporation, society, association, foundation, or institution
19that has been issued a sales tax exemption identification
20number by the Department that assists victims of the disaster
21who reside within the declared disaster area.
22    (25) Beginning with taxable years ending on or after
23December 31, 1995 and ending with taxable years ending on or
24before December 31, 2004, personal property that is used in
25the performance of infrastructure repairs in this State,
26including but not limited to municipal roads and streets,

 

 

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1access roads, bridges, sidewalks, waste disposal systems,
2water and sewer line extensions, water distribution and
3purification facilities, storm water drainage and retention
4facilities, and sewage treatment facilities, resulting from a
5State or federally declared disaster in Illinois or bordering
6Illinois when such repairs are initiated on facilities located
7in the declared disaster area within 6 months after the
8disaster.
9    (26) Beginning July 1, 1999, game or game birds purchased
10at a "game breeding and hunting preserve area" as that term is
11used in the Wildlife Code. This paragraph is exempt from the
12provisions of Section 3-90.
13    (27) A motor vehicle, as that term is defined in Section
141-146 of the Illinois Vehicle Code, that is donated to a
15corporation, limited liability company, society, association,
16foundation, or institution that is determined by the
17Department to be organized and operated exclusively for
18educational purposes. For purposes of this exemption, "a
19corporation, limited liability company, society, association,
20foundation, or institution organized and operated exclusively
21for educational purposes" means all tax-supported public
22schools, private schools that offer systematic instruction in
23useful branches of learning by methods common to public
24schools and that compare favorably in their scope and
25intensity with the course of study presented in tax-supported
26schools, and vocational or technical schools or institutes

 

 

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1organized and operated exclusively to provide a course of
2study of not less than 6 weeks duration and designed to prepare
3individuals to follow a trade or to pursue a manual,
4technical, mechanical, industrial, business, or commercial
5occupation.
6    (28) Beginning January 1, 2000, personal property,
7including food, purchased through fundraising events for the
8benefit of a public or private elementary or secondary school,
9a group of those schools, or one or more school districts if
10the events are sponsored by an entity recognized by the school
11district that consists primarily of volunteers and includes
12parents and teachers of the school children. This paragraph
13does not apply to fundraising events (i) for the benefit of
14private home instruction or (ii) for which the fundraising
15entity purchases the personal property sold at the events from
16another individual or entity that sold the property for the
17purpose of resale by the fundraising entity and that profits
18from the sale to the fundraising entity. This paragraph is
19exempt from the provisions of Section 3-90.
20    (29) Beginning January 1, 2000 and through December 31,
212001, new or used automatic vending machines that prepare and
22serve hot food and beverages, including coffee, soup, and
23other items, and replacement parts for these machines.
24Beginning January 1, 2002 and through June 30, 2003, machines
25and parts for machines used in commercial, coin-operated
26amusement and vending business if a use or occupation tax is

 

 

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1paid on the gross receipts derived from the use of the
2commercial, coin-operated amusement and vending machines. This
3paragraph is exempt from the provisions of Section 3-90.
4    (30) Beginning January 1, 2001 and through June 30, 2016,
5food for human consumption that is to be consumed off the
6premises where it is sold (other than alcoholic beverages,
7soft drinks, and food that has been prepared for immediate
8consumption) and prescription and nonprescription medicines,
9drugs, medical appliances, and insulin, urine testing
10materials, syringes, and needles used by diabetics, for human
11use, when purchased for use by a person receiving medical
12assistance under Article V of the Illinois Public Aid Code who
13resides in a licensed long-term care facility, as defined in
14the Nursing Home Care Act, or in a licensed facility as defined
15in the ID/DD Community Care Act, the MC/DD Act, or the
16Specialized Mental Health Rehabilitation Act of 2013.
17    (31) Beginning on August 2, 2001 (the effective date of
18Public Act 92-227), computers and communications equipment
19utilized for any hospital purpose and equipment used in the
20diagnosis, analysis, or treatment of hospital patients
21purchased by a lessor who leases the equipment, under a lease
22of one year or longer executed or in effect at the time the
23lessor would otherwise be subject to the tax imposed by this
24Act, to a hospital that has been issued an active tax exemption
25identification number by the Department under Section 1g of
26the Retailers' Occupation Tax Act. If the equipment is leased

 

 

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1in a manner that does not qualify for this exemption or is used
2in any other nonexempt manner, the lessor shall be liable for
3the tax imposed under this Act or the Service Use Tax Act, as
4the case may be, based on the fair market value of the property
5at the time the nonqualifying use occurs. No lessor shall
6collect or attempt to collect an amount (however designated)
7that purports to reimburse that lessor for the tax imposed by
8this Act or the Service Use Tax Act, as the case may be, if the
9tax has not been paid by the lessor. If a lessor improperly
10collects any such amount from the lessee, the lessee shall
11have a legal right to claim a refund of that amount from the
12lessor. If, however, that amount is not refunded to the lessee
13for any reason, the lessor is liable to pay that amount to the
14Department. This paragraph is exempt from the provisions of
15Section 3-90.
16    (32) Beginning on August 2, 2001 (the effective date of
17Public Act 92-227), personal property purchased by a lessor
18who leases the property, under a lease of one year or longer
19executed or in effect at the time the lessor would otherwise be
20subject to the tax imposed by this Act, to a governmental body
21that has been issued an active sales tax exemption
22identification number by the Department under Section 1g of
23the Retailers' Occupation Tax Act. If the property is leased
24in a manner that does not qualify for this exemption or used in
25any other nonexempt manner, the lessor shall be liable for the
26tax imposed under this Act or the Service Use Tax Act, as the

 

 

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1case may be, based on the fair market value of the property at
2the time the nonqualifying use occurs. No lessor shall collect
3or attempt to collect an amount (however designated) that
4purports to reimburse that lessor for the tax imposed by this
5Act or the Service Use Tax Act, as the case may be, if the tax
6has not been paid by the lessor. If a lessor improperly
7collects any such amount from the lessee, the lessee shall
8have a legal right to claim a refund of that amount from the
9lessor. If, however, that amount is not refunded to the lessee
10for any reason, the lessor is liable to pay that amount to the
11Department. This paragraph is exempt from the provisions of
12Section 3-90.
13    (33) On and after July 1, 2003 and through June 30, 2004,
14the use in this State of motor vehicles of the second division
15with a gross vehicle weight in excess of 8,000 pounds and that
16are subject to the commercial distribution fee imposed under
17Section 3-815.1 of the Illinois Vehicle Code. Beginning on
18July 1, 2004 and through June 30, 2005, the use in this State
19of motor vehicles of the second division: (i) with a gross
20vehicle weight rating in excess of 8,000 pounds; (ii) that are
21subject to the commercial distribution fee imposed under
22Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
23are primarily used for commercial purposes. Through June 30,
242005, this exemption applies to repair and replacement parts
25added after the initial purchase of such a motor vehicle if
26that motor vehicle is used in a manner that would qualify for

 

 

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1the rolling stock exemption otherwise provided for in this
2Act. For purposes of this paragraph, the term "used for
3commercial purposes" means the transportation of persons or
4property in furtherance of any commercial or industrial
5enterprise, whether for-hire or not.
6    (34) Beginning January 1, 2008, tangible personal property
7used in the construction or maintenance of a community water
8supply, as defined under Section 3.145 of the Environmental
9Protection Act, that is operated by a not-for-profit
10corporation that holds a valid water supply permit issued
11under Title IV of the Environmental Protection Act. This
12paragraph is exempt from the provisions of Section 3-90.
13    (35) Beginning January 1, 2010 and continuing through
14December 31, 2024, materials, parts, equipment, components,
15and furnishings incorporated into or upon an aircraft as part
16of the modification, refurbishment, completion, replacement,
17repair, or maintenance of the aircraft. This exemption
18includes consumable supplies used in the modification,
19refurbishment, completion, replacement, repair, and
20maintenance of aircraft, but excludes any materials, parts,
21equipment, components, and consumable supplies used in the
22modification, replacement, repair, and maintenance of aircraft
23engines or power plants, whether such engines or power plants
24are installed or uninstalled upon any such aircraft.
25"Consumable supplies" include, but are not limited to,
26adhesive, tape, sandpaper, general purpose lubricants,

 

 

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1cleaning solution, latex gloves, and protective films. This
2exemption applies only to the use of qualifying tangible
3personal property by persons who modify, refurbish, complete,
4repair, replace, or maintain aircraft and who (i) hold an Air
5Agency Certificate and are empowered to operate an approved
6repair station by the Federal Aviation Administration, (ii)
7have a Class IV Rating, and (iii) conduct operations in
8accordance with Part 145 of the Federal Aviation Regulations.
9The exemption does not include aircraft operated by a
10commercial air carrier providing scheduled passenger air
11service pursuant to authority issued under Part 121 or Part
12129 of the Federal Aviation Regulations. The changes made to
13this paragraph (35) by Public Act 98-534 are declarative of
14existing law. It is the intent of the General Assembly that the
15exemption under this paragraph (35) applies continuously from
16January 1, 2010 through December 31, 2024; however, no claim
17for credit or refund is allowed for taxes paid as a result of
18the disallowance of this exemption on or after January 1, 2015
19and prior to the effective date of this amendatory Act of the
20101st General Assembly.
21    (36) Tangible personal property purchased by a
22public-facilities corporation, as described in Section
2311-65-10 of the Illinois Municipal Code, for purposes of
24constructing or furnishing a municipal convention hall, but
25only if the legal title to the municipal convention hall is
26transferred to the municipality without any further

 

 

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1consideration by or on behalf of the municipality at the time
2of the completion of the municipal convention hall or upon the
3retirement or redemption of any bonds or other debt
4instruments issued by the public-facilities corporation in
5connection with the development of the municipal convention
6hall. This exemption includes existing public-facilities
7corporations as provided in Section 11-65-25 of the Illinois
8Municipal Code. This paragraph is exempt from the provisions
9of Section 3-90.
10    (37) Beginning January 1, 2017 and through December 31,
112026, menstrual pads, tampons, and menstrual cups.
12    (38) Merchandise that is subject to the Rental Purchase
13Agreement Occupation and Use Tax. The purchaser must certify
14that the item is purchased to be rented subject to a rental
15purchase agreement, as defined in the Rental Purchase
16Agreement Act, and provide proof of registration under the
17Rental Purchase Agreement Occupation and Use Tax Act. This
18paragraph is exempt from the provisions of Section 3-90.
19    (39) Tangible personal property purchased by a purchaser
20who is exempt from the tax imposed by this Act by operation of
21federal law. This paragraph is exempt from the provisions of
22Section 3-90.
23    (40) Qualified tangible personal property used in the
24construction or operation of a data center that has been
25granted a certificate of exemption by the Department of
26Commerce and Economic Opportunity, whether that tangible

 

 

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1personal property is purchased by the owner, operator, or
2tenant of the data center or by a contractor or subcontractor
3of the owner, operator, or tenant. Data centers that would
4have qualified for a certificate of exemption prior to January
51, 2020 had Public Act 101-31 been in effect may apply for and
6obtain an exemption for subsequent purchases of computer
7equipment or enabling software purchased or leased to upgrade,
8supplement, or replace computer equipment or enabling software
9purchased or leased in the original investment that would have
10qualified.
11    The Department of Commerce and Economic Opportunity shall
12grant a certificate of exemption under this item (40) to
13qualified data centers as defined by Section 605-1025 of the
14Department of Commerce and Economic Opportunity Law of the
15Civil Administrative Code of Illinois.
16    For the purposes of this item (40):
17        "Data center" means a building or a series of
18    buildings rehabilitated or constructed to house working
19    servers in one physical location or multiple sites within
20    the State of Illinois.
21        "Qualified tangible personal property" means:
22    electrical systems and equipment; climate control and
23    chilling equipment and systems; mechanical systems and
24    equipment; monitoring and secure systems; emergency
25    generators; hardware; computers; servers; data storage
26    devices; network connectivity equipment; racks; cabinets;

 

 

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1    telecommunications cabling infrastructure; raised floor
2    systems; peripheral components or systems; software;
3    mechanical, electrical, or plumbing systems; battery
4    systems; cooling systems and towers; temperature control
5    systems; other cabling; and other data center
6    infrastructure equipment and systems necessary to operate
7    qualified tangible personal property, including fixtures;
8    and component parts of any of the foregoing, including
9    installation, maintenance, repair, refurbishment, and
10    replacement of qualified tangible personal property to
11    generate, transform, transmit, distribute, or manage
12    electricity necessary to operate qualified tangible
13    personal property; and all other tangible personal
14    property that is essential to the operations of a computer
15    data center. The term "qualified tangible personal
16    property" also includes building materials physically
17    incorporated in to the qualifying data center. To document
18    the exemption allowed under this Section, the retailer
19    must obtain from the purchaser a copy of the certificate
20    of eligibility issued by the Department of Commerce and
21    Economic Opportunity.
22    This item (40) is exempt from the provisions of Section
233-90.
24(Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19;
25101-81, eff. 7-12-19; 101-629, eff. 2-5-20; 102-16, eff.
266-17-21.)
 

 

 

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1    Section 5-10. The Service Use Tax Act is amended by
2changing Section 3-5 as follows:
 
3    (35 ILCS 110/3-5)
4    Sec. 3-5. Exemptions. Use of the following tangible
5personal property is exempt from the tax imposed by this Act:
6    (1) Personal property purchased from a corporation,
7society, association, foundation, institution, or
8organization, other than a limited liability company, that is
9organized and operated as a not-for-profit service enterprise
10for the benefit of persons 65 years of age or older if the
11personal property was not purchased by the enterprise for the
12purpose of resale by the enterprise.
13    (2) Personal property purchased by a non-profit Illinois
14county fair association for use in conducting, operating, or
15promoting the county fair.
16    (3) Personal property purchased by a not-for-profit arts
17or cultural organization that establishes, by proof required
18by the Department by rule, that it has received an exemption
19under Section 501(c)(3) of the Internal Revenue Code and that
20is organized and operated primarily for the presentation or
21support of arts or cultural programming, activities, or
22services. These organizations include, but are not limited to,
23music and dramatic arts organizations such as symphony
24orchestras and theatrical groups, arts and cultural service

 

 

10200HB1497ham001- 23 -LRB102 03513 HLH 38716 a

1organizations, local arts councils, visual arts organizations,
2and media arts organizations. On and after July 1, 2001 (the
3effective date of Public Act 92-35), however, an entity
4otherwise eligible for this exemption shall not make tax-free
5purchases unless it has an active identification number issued
6by the Department.
7    (4) Legal tender, currency, medallions, or gold or silver
8coinage issued by the State of Illinois, the government of the
9United States of America, or the government of any foreign
10country, and bullion.
11    (5) Until July 1, 2003 and beginning again on September 1,
122004 through August 30, 2014, graphic arts machinery and
13equipment, including repair and replacement parts, both new
14and used, and including that manufactured on special order or
15purchased for lease, certified by the purchaser to be used
16primarily for graphic arts production. Equipment includes
17chemicals or chemicals acting as catalysts but only if the
18chemicals or chemicals acting as catalysts effect a direct and
19immediate change upon a graphic arts product. Beginning on
20July 1, 2017, graphic arts machinery and equipment is included
21in the manufacturing and assembling machinery and equipment
22exemption under Section 2 of this Act.
23    (6) Personal property purchased from a teacher-sponsored
24student organization affiliated with an elementary or
25secondary school located in Illinois.
26    (7) Farm machinery and equipment, both new and used,

 

 

10200HB1497ham001- 24 -LRB102 03513 HLH 38716 a

1including that manufactured on special order, certified by the
2purchaser to be used primarily for production agriculture or
3State or federal agricultural programs, including individual
4replacement parts for the machinery and equipment, including
5machinery and equipment purchased for lease, and including
6implements of husbandry defined in Section 1-130 of the
7Illinois Vehicle Code, farm machinery and agricultural
8chemical and fertilizer spreaders, and nurse wagons required
9to be registered under Section 3-809 of the Illinois Vehicle
10Code, but excluding other motor vehicles required to be
11registered under the Illinois Vehicle Code. Horticultural
12polyhouses or hoop houses used for propagating, growing, or
13overwintering plants shall be considered farm machinery and
14equipment under this item (7). Agricultural chemical tender
15tanks and dry boxes shall include units sold separately from a
16motor vehicle required to be licensed and units sold mounted
17on a motor vehicle required to be licensed if the selling price
18of the tender is separately stated.
19    Farm machinery and equipment shall include precision
20farming equipment that is installed or purchased to be
21installed on farm machinery and equipment including, but not
22limited to, tractors, harvesters, sprayers, planters, seeders,
23or spreaders. Precision farming equipment includes, but is not
24limited to, soil testing sensors, computers, monitors,
25software, global positioning and mapping systems, and other
26such equipment.

 

 

10200HB1497ham001- 25 -LRB102 03513 HLH 38716 a

1    Farm machinery and equipment also includes computers,
2sensors, software, and related equipment used primarily in the
3computer-assisted operation of production agriculture
4facilities, equipment, and activities such as, but not limited
5to, the collection, monitoring, and correlation of animal and
6crop data for the purpose of formulating animal diets and
7agricultural chemicals. This item (7) is exempt from the
8provisions of Section 3-75.
9    (8) Until June 30, 2013, fuel and petroleum products sold
10to or used by an air common carrier, certified by the carrier
11to be used for consumption, shipment, or storage in the
12conduct of its business as an air common carrier, for a flight
13destined for or returning from a location or locations outside
14the United States without regard to previous or subsequent
15domestic stopovers.
16    Beginning July 1, 2013, fuel and petroleum products sold
17to or used by an air carrier, certified by the carrier to be
18used for consumption, shipment, or storage in the conduct of
19its business as an air common carrier, for a flight that (i) is
20engaged in foreign trade or is engaged in trade between the
21United States and any of its possessions and (ii) transports
22at least one individual or package for hire from the city of
23origination to the city of final destination on the same
24aircraft, without regard to a change in the flight number of
25that aircraft.
26    (9) Proceeds of mandatory service charges separately

 

 

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1stated on customers' bills for the purchase and consumption of
2food and beverages acquired as an incident to the purchase of a
3service from a serviceman, to the extent that the proceeds of
4the service charge are in fact turned over as tips or as a
5substitute for tips to the employees who participate directly
6in preparing, serving, hosting or cleaning up the food or
7beverage function with respect to which the service charge is
8imposed.
9    (10) Until July 1, 2003, oil field exploration, drilling,
10and production equipment, including (i) rigs and parts of
11rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
12pipe and tubular goods, including casing and drill strings,
13(iii) pumps and pump-jack units, (iv) storage tanks and flow
14lines, (v) any individual replacement part for oil field
15exploration, drilling, and production equipment, and (vi)
16machinery and equipment purchased for lease; but excluding
17motor vehicles required to be registered under the Illinois
18Vehicle Code.
19    (11) Proceeds from the sale of photoprocessing machinery
20and equipment, including repair and replacement parts, both
21new and used, including that manufactured on special order,
22certified by the purchaser to be used primarily for
23photoprocessing, and including photoprocessing machinery and
24equipment purchased for lease.
25    (12) Coal Until July 1, 2023, coal and aggregate
26exploration, mining, off-highway hauling, processing,

 

 

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1maintenance, and reclamation equipment, including replacement
2parts and equipment, and including equipment purchased for
3lease, but excluding motor vehicles required to be registered
4under the Illinois Vehicle Code. The changes made to this
5Section by Public Act 97-767 apply on and after July 1, 2003,
6but no claim for credit or refund is allowed on or after August
716, 2013 (the effective date of Public Act 98-456) for such
8taxes paid during the period beginning July 1, 2003 and ending
9on August 16, 2013 (the effective date of Public Act 98-456).
10The exemption under this paragraph (12) for coal applies until
11July 1, 2023. The exemption under this paragraph (12) for
12aggregate exploration, mining, off-highway hauling,
13processing, maintenance, and reclamation equipment applies
14until July 1, 2028.
15    (13) Semen used for artificial insemination of livestock
16for direct agricultural production.
17    (14) Horses, or interests in horses, registered with and
18meeting the requirements of any of the Arabian Horse Club
19Registry of America, Appaloosa Horse Club, American Quarter
20Horse Association, United States Trotting Association, or
21Jockey Club, as appropriate, used for purposes of breeding or
22racing for prizes. This item (14) is exempt from the
23provisions of Section 3-75, and the exemption provided for
24under this item (14) applies for all periods beginning May 30,
251995, but no claim for credit or refund is allowed on or after
26January 1, 2008 (the effective date of Public Act 95-88) for

 

 

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1such taxes paid during the period beginning May 30, 2000 and
2ending on January 1, 2008 (the effective date of Public Act
395-88).
4    (15) Computers and communications equipment utilized for
5any hospital purpose and equipment used in the diagnosis,
6analysis, or treatment of hospital patients purchased by a
7lessor who leases the equipment, under a lease of one year or
8longer executed or in effect at the time the lessor would
9otherwise be subject to the tax imposed by this Act, to a
10hospital that has been issued an active tax exemption
11identification number by the Department under Section 1g of
12the Retailers' Occupation Tax Act. If the equipment is leased
13in a manner that does not qualify for this exemption or is used
14in any other non-exempt manner, the lessor shall be liable for
15the tax imposed under this Act or the Use Tax Act, as the case
16may be, based on the fair market value of the property at the
17time the non-qualifying use occurs. No lessor shall collect or
18attempt to collect an amount (however designated) that
19purports to reimburse that lessor for the tax imposed by this
20Act or the Use Tax Act, as the case may be, if the tax has not
21been paid by the lessor. If a lessor improperly collects any
22such amount from the lessee, the lessee shall have a legal
23right to claim a refund of that amount from the lessor. If,
24however, that amount is not refunded to the lessee for any
25reason, the lessor is liable to pay that amount to the
26Department.

 

 

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1    (16) Personal property purchased by a lessor who leases
2the property, under a lease of one year or longer executed or
3in effect at the time the lessor would otherwise be subject to
4the tax imposed by this Act, to a governmental body that has
5been issued an active tax exemption identification number by
6the Department under Section 1g of the Retailers' Occupation
7Tax Act. If the property is leased in a manner that does not
8qualify for this exemption or is used in any other non-exempt
9manner, the lessor shall be liable for the tax imposed under
10this Act or the Use Tax Act, as the case may be, based on the
11fair market value of the property at the time the
12non-qualifying use occurs. No lessor shall collect or attempt
13to collect an amount (however designated) that purports to
14reimburse that lessor for the tax imposed by this Act or the
15Use Tax Act, as the case may be, if the tax has not been paid
16by the lessor. If a lessor improperly collects any such amount
17from the lessee, the lessee shall have a legal right to claim a
18refund of that amount from the lessor. If, however, that
19amount is not refunded to the lessee for any reason, the lessor
20is liable to pay that amount to the Department.
21    (17) Beginning with taxable years ending on or after
22December 31, 1995 and ending with taxable years ending on or
23before December 31, 2004, personal property that is donated
24for disaster relief to be used in a State or federally declared
25disaster area in Illinois or bordering Illinois by a
26manufacturer or retailer that is registered in this State to a

 

 

10200HB1497ham001- 30 -LRB102 03513 HLH 38716 a

1corporation, society, association, foundation, or institution
2that has been issued a sales tax exemption identification
3number by the Department that assists victims of the disaster
4who reside within the declared disaster area.
5    (18) Beginning with taxable years ending on or after
6December 31, 1995 and ending with taxable years ending on or
7before December 31, 2004, personal property that is used in
8the performance of infrastructure repairs in this State,
9including but not limited to municipal roads and streets,
10access roads, bridges, sidewalks, waste disposal systems,
11water and sewer line extensions, water distribution and
12purification facilities, storm water drainage and retention
13facilities, and sewage treatment facilities, resulting from a
14State or federally declared disaster in Illinois or bordering
15Illinois when such repairs are initiated on facilities located
16in the declared disaster area within 6 months after the
17disaster.
18    (19) Beginning July 1, 1999, game or game birds purchased
19at a "game breeding and hunting preserve area" as that term is
20used in the Wildlife Code. This paragraph is exempt from the
21provisions of Section 3-75.
22    (20) A motor vehicle, as that term is defined in Section
231-146 of the Illinois Vehicle Code, that is donated to a
24corporation, limited liability company, society, association,
25foundation, or institution that is determined by the
26Department to be organized and operated exclusively for

 

 

10200HB1497ham001- 31 -LRB102 03513 HLH 38716 a

1educational purposes. For purposes of this exemption, "a
2corporation, limited liability company, society, association,
3foundation, or institution organized and operated exclusively
4for educational purposes" means all tax-supported public
5schools, private schools that offer systematic instruction in
6useful branches of learning by methods common to public
7schools and that compare favorably in their scope and
8intensity with the course of study presented in tax-supported
9schools, and vocational or technical schools or institutes
10organized and operated exclusively to provide a course of
11study of not less than 6 weeks duration and designed to prepare
12individuals to follow a trade or to pursue a manual,
13technical, mechanical, industrial, business, or commercial
14occupation.
15    (21) Beginning January 1, 2000, personal property,
16including food, purchased through fundraising events for the
17benefit of a public or private elementary or secondary school,
18a group of those schools, or one or more school districts if
19the events are sponsored by an entity recognized by the school
20district that consists primarily of volunteers and includes
21parents and teachers of the school children. This paragraph
22does not apply to fundraising events (i) for the benefit of
23private home instruction or (ii) for which the fundraising
24entity purchases the personal property sold at the events from
25another individual or entity that sold the property for the
26purpose of resale by the fundraising entity and that profits

 

 

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1from the sale to the fundraising entity. This paragraph is
2exempt from the provisions of Section 3-75.
3    (22) Beginning January 1, 2000 and through December 31,
42001, new or used automatic vending machines that prepare and
5serve hot food and beverages, including coffee, soup, and
6other items, and replacement parts for these machines.
7Beginning January 1, 2002 and through June 30, 2003, machines
8and parts for machines used in commercial, coin-operated
9amusement and vending business if a use or occupation tax is
10paid on the gross receipts derived from the use of the
11commercial, coin-operated amusement and vending machines. This
12paragraph is exempt from the provisions of Section 3-75.
13    (23) Beginning August 23, 2001 and through June 30, 2016,
14food for human consumption that is to be consumed off the
15premises where it is sold (other than alcoholic beverages,
16soft drinks, and food that has been prepared for immediate
17consumption) and prescription and nonprescription medicines,
18drugs, medical appliances, and insulin, urine testing
19materials, syringes, and needles used by diabetics, for human
20use, when purchased for use by a person receiving medical
21assistance under Article V of the Illinois Public Aid Code who
22resides in a licensed long-term care facility, as defined in
23the Nursing Home Care Act, or in a licensed facility as defined
24in the ID/DD Community Care Act, the MC/DD Act, or the
25Specialized Mental Health Rehabilitation Act of 2013.
26    (24) Beginning on August 2, 2001 (the effective date of

 

 

10200HB1497ham001- 33 -LRB102 03513 HLH 38716 a

1Public Act 92-227), computers and communications equipment
2utilized for any hospital purpose and equipment used in the
3diagnosis, analysis, or treatment of hospital patients
4purchased by a lessor who leases the equipment, under a lease
5of one year or longer executed or in effect at the time the
6lessor would otherwise be subject to the tax imposed by this
7Act, to a hospital that has been issued an active tax exemption
8identification number by the Department under Section 1g of
9the Retailers' Occupation Tax Act. If the equipment is leased
10in a manner that does not qualify for this exemption or is used
11in any other nonexempt manner, the lessor shall be liable for
12the tax imposed under this Act or the Use Tax Act, as the case
13may be, based on the fair market value of the property at the
14time the nonqualifying use occurs. No lessor shall collect or
15attempt to collect an amount (however designated) that
16purports to reimburse that lessor for the tax imposed by this
17Act or the Use Tax Act, as the case may be, if the tax has not
18been paid by the lessor. If a lessor improperly collects any
19such amount from the lessee, the lessee shall have a legal
20right to claim a refund of that amount from the lessor. If,
21however, that amount is not refunded to the lessee for any
22reason, the lessor is liable to pay that amount to the
23Department. This paragraph is exempt from the provisions of
24Section 3-75.
25    (25) Beginning on August 2, 2001 (the effective date of
26Public Act 92-227), personal property purchased by a lessor

 

 

10200HB1497ham001- 34 -LRB102 03513 HLH 38716 a

1who leases the property, under a lease of one year or longer
2executed or in effect at the time the lessor would otherwise be
3subject to the tax imposed by this Act, to a governmental body
4that has been issued an active tax exemption identification
5number by the Department under Section 1g of the Retailers'
6Occupation Tax Act. If the property is leased in a manner that
7does not qualify for this exemption or is used in any other
8nonexempt manner, the lessor shall be liable for the tax
9imposed under this Act or the Use Tax Act, as the case may be,
10based on the fair market value of the property at the time the
11nonqualifying use occurs. No lessor shall collect or attempt
12to collect an amount (however designated) that purports to
13reimburse that lessor for the tax imposed by this Act or the
14Use Tax Act, as the case may be, if the tax has not been paid
15by the lessor. If a lessor improperly collects any such amount
16from the lessee, the lessee shall have a legal right to claim a
17refund of that amount from the lessor. If, however, that
18amount is not refunded to the lessee for any reason, the lessor
19is liable to pay that amount to the Department. This paragraph
20is exempt from the provisions of Section 3-75.
21    (26) Beginning January 1, 2008, tangible personal property
22used in the construction or maintenance of a community water
23supply, as defined under Section 3.145 of the Environmental
24Protection Act, that is operated by a not-for-profit
25corporation that holds a valid water supply permit issued
26under Title IV of the Environmental Protection Act. This

 

 

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1paragraph is exempt from the provisions of Section 3-75.
2    (27) Beginning January 1, 2010 and continuing through
3December 31, 2024, materials, parts, equipment, components,
4and furnishings incorporated into or upon an aircraft as part
5of the modification, refurbishment, completion, replacement,
6repair, or maintenance of the aircraft. This exemption
7includes consumable supplies used in the modification,
8refurbishment, completion, replacement, repair, and
9maintenance of aircraft, but excludes any materials, parts,
10equipment, components, and consumable supplies used in the
11modification, replacement, repair, and maintenance of aircraft
12engines or power plants, whether such engines or power plants
13are installed or uninstalled upon any such aircraft.
14"Consumable supplies" include, but are not limited to,
15adhesive, tape, sandpaper, general purpose lubricants,
16cleaning solution, latex gloves, and protective films. This
17exemption applies only to the use of qualifying tangible
18personal property transferred incident to the modification,
19refurbishment, completion, replacement, repair, or maintenance
20of aircraft by persons who (i) hold an Air Agency Certificate
21and are empowered to operate an approved repair station by the
22Federal Aviation Administration, (ii) have a Class IV Rating,
23and (iii) conduct operations in accordance with Part 145 of
24the Federal Aviation Regulations. The exemption does not
25include aircraft operated by a commercial air carrier
26providing scheduled passenger air service pursuant to

 

 

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1authority issued under Part 121 or Part 129 of the Federal
2Aviation Regulations. The changes made to this paragraph (27)
3by Public Act 98-534 are declarative of existing law. It is the
4intent of the General Assembly that the exemption under this
5paragraph (27) applies continuously from January 1, 2010
6through December 31, 2024; however, no claim for credit or
7refund is allowed for taxes paid as a result of the
8disallowance of this exemption on or after January 1, 2015 and
9prior to the effective date of this amendatory Act of the 101st
10General Assembly.
11    (28) Tangible personal property purchased by a
12public-facilities corporation, as described in Section
1311-65-10 of the Illinois Municipal Code, for purposes of
14constructing or furnishing a municipal convention hall, but
15only if the legal title to the municipal convention hall is
16transferred to the municipality without any further
17consideration by or on behalf of the municipality at the time
18of the completion of the municipal convention hall or upon the
19retirement or redemption of any bonds or other debt
20instruments issued by the public-facilities corporation in
21connection with the development of the municipal convention
22hall. This exemption includes existing public-facilities
23corporations as provided in Section 11-65-25 of the Illinois
24Municipal Code. This paragraph is exempt from the provisions
25of Section 3-75.
26    (29) Beginning January 1, 2017 and through December 31,

 

 

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12026, menstrual pads, tampons, and menstrual cups.
2    (30) Tangible personal property transferred to a purchaser
3who is exempt from the tax imposed by this Act by operation of
4federal law. This paragraph is exempt from the provisions of
5Section 3-75.
6    (31) Qualified tangible personal property used in the
7construction or operation of a data center that has been
8granted a certificate of exemption by the Department of
9Commerce and Economic Opportunity, whether that tangible
10personal property is purchased by the owner, operator, or
11tenant of the data center or by a contractor or subcontractor
12of the owner, operator, or tenant. Data centers that would
13have qualified for a certificate of exemption prior to January
141, 2020 had this amendatory Act of the 101st General Assembly
15been in effect, may apply for and obtain an exemption for
16subsequent purchases of computer equipment or enabling
17software purchased or leased to upgrade, supplement, or
18replace computer equipment or enabling software purchased or
19leased in the original investment that would have qualified.
20    The Department of Commerce and Economic Opportunity shall
21grant a certificate of exemption under this item (31) to
22qualified data centers as defined by Section 605-1025 of the
23Department of Commerce and Economic Opportunity Law of the
24Civil Administrative Code of Illinois.
25    For the purposes of this item (31):
26        "Data center" means a building or a series of

 

 

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1    buildings rehabilitated or constructed to house working
2    servers in one physical location or multiple sites within
3    the State of Illinois.
4        "Qualified tangible personal property" means:
5    electrical systems and equipment; climate control and
6    chilling equipment and systems; mechanical systems and
7    equipment; monitoring and secure systems; emergency
8    generators; hardware; computers; servers; data storage
9    devices; network connectivity equipment; racks; cabinets;
10    telecommunications cabling infrastructure; raised floor
11    systems; peripheral components or systems; software;
12    mechanical, electrical, or plumbing systems; battery
13    systems; cooling systems and towers; temperature control
14    systems; other cabling; and other data center
15    infrastructure equipment and systems necessary to operate
16    qualified tangible personal property, including fixtures;
17    and component parts of any of the foregoing, including
18    installation, maintenance, repair, refurbishment, and
19    replacement of qualified tangible personal property to
20    generate, transform, transmit, distribute, or manage
21    electricity necessary to operate qualified tangible
22    personal property; and all other tangible personal
23    property that is essential to the operations of a computer
24    data center. The term "qualified tangible personal
25    property" also includes building materials physically
26    incorporated in to the qualifying data center. To document

 

 

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1    the exemption allowed under this Section, the retailer
2    must obtain from the purchaser a copy of the certificate
3    of eligibility issued by the Department of Commerce and
4    Economic Opportunity.
5    This item (31) is exempt from the provisions of Section
63-75.
7(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
8101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
 
9    Section 5-15. The Service Occupation Tax Act is amended by
10changing Section 3-5 as follows:
 
11    (35 ILCS 115/3-5)
12    Sec. 3-5. Exemptions. The following tangible personal
13property is exempt from the tax imposed by this Act:
14    (1) Personal property sold by a corporation, society,
15association, foundation, institution, or organization, other
16than a limited liability company, that is organized and
17operated as a not-for-profit service enterprise for the
18benefit of persons 65 years of age or older if the personal
19property was not purchased by the enterprise for the purpose
20of resale by the enterprise.
21    (2) Personal property purchased by a not-for-profit
22Illinois county fair association for use in conducting,
23operating, or promoting the county fair.
24    (3) Personal property purchased by any not-for-profit arts

 

 

10200HB1497ham001- 40 -LRB102 03513 HLH 38716 a

1or cultural organization that establishes, by proof required
2by the Department by rule, that it has received an exemption
3under Section 501(c)(3) of the Internal Revenue Code and that
4is organized and operated primarily for the presentation or
5support of arts or cultural programming, activities, or
6services. These organizations include, but are not limited to,
7music and dramatic arts organizations such as symphony
8orchestras and theatrical groups, arts and cultural service
9organizations, local arts councils, visual arts organizations,
10and media arts organizations. On and after July 1, 2001 (the
11effective date of Public Act 92-35), however, an entity
12otherwise eligible for this exemption shall not make tax-free
13purchases unless it has an active identification number issued
14by the Department.
15    (4) Legal tender, currency, medallions, or gold or silver
16coinage issued by the State of Illinois, the government of the
17United States of America, or the government of any foreign
18country, and bullion.
19    (5) Until July 1, 2003 and beginning again on September 1,
202004 through August 30, 2014, graphic arts machinery and
21equipment, including repair and replacement parts, both new
22and used, and including that manufactured on special order or
23purchased for lease, certified by the purchaser to be used
24primarily for graphic arts production. Equipment includes
25chemicals or chemicals acting as catalysts but only if the
26chemicals or chemicals acting as catalysts effect a direct and

 

 

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1immediate change upon a graphic arts product. Beginning on
2July 1, 2017, graphic arts machinery and equipment is included
3in the manufacturing and assembling machinery and equipment
4exemption under Section 2 of this Act.
5    (6) Personal property sold by a teacher-sponsored student
6organization affiliated with an elementary or secondary school
7located in Illinois.
8    (7) Farm machinery and equipment, both new and used,
9including that manufactured on special order, certified by the
10purchaser to be used primarily for production agriculture or
11State or federal agricultural programs, including individual
12replacement parts for the machinery and equipment, including
13machinery and equipment purchased for lease, and including
14implements of husbandry defined in Section 1-130 of the
15Illinois Vehicle Code, farm machinery and agricultural
16chemical and fertilizer spreaders, and nurse wagons required
17to be registered under Section 3-809 of the Illinois Vehicle
18Code, but excluding other motor vehicles required to be
19registered under the Illinois Vehicle Code. Horticultural
20polyhouses or hoop houses used for propagating, growing, or
21overwintering plants shall be considered farm machinery and
22equipment under this item (7). Agricultural chemical tender
23tanks and dry boxes shall include units sold separately from a
24motor vehicle required to be licensed and units sold mounted
25on a motor vehicle required to be licensed if the selling price
26of the tender is separately stated.

 

 

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1    Farm machinery and equipment shall include precision
2farming equipment that is installed or purchased to be
3installed on farm machinery and equipment including, but not
4limited to, tractors, harvesters, sprayers, planters, seeders,
5or spreaders. Precision farming equipment includes, but is not
6limited to, soil testing sensors, computers, monitors,
7software, global positioning and mapping systems, and other
8such equipment.
9    Farm machinery and equipment also includes computers,
10sensors, software, and related equipment used primarily in the
11computer-assisted operation of production agriculture
12facilities, equipment, and activities such as, but not limited
13to, the collection, monitoring, and correlation of animal and
14crop data for the purpose of formulating animal diets and
15agricultural chemicals. This item (7) is exempt from the
16provisions of Section 3-55.
17    (8) Until June 30, 2013, fuel and petroleum products sold
18to or used by an air common carrier, certified by the carrier
19to be used for consumption, shipment, or storage in the
20conduct of its business as an air common carrier, for a flight
21destined for or returning from a location or locations outside
22the United States without regard to previous or subsequent
23domestic stopovers.
24    Beginning July 1, 2013, fuel and petroleum products sold
25to or used by an air carrier, certified by the carrier to be
26used for consumption, shipment, or storage in the conduct of

 

 

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1its business as an air common carrier, for a flight that (i) is
2engaged in foreign trade or is engaged in trade between the
3United States and any of its possessions and (ii) transports
4at least one individual or package for hire from the city of
5origination to the city of final destination on the same
6aircraft, without regard to a change in the flight number of
7that aircraft.
8    (9) Proceeds of mandatory service charges separately
9stated on customers' bills for the purchase and consumption of
10food and beverages, to the extent that the proceeds of the
11service charge are in fact turned over as tips or as a
12substitute for tips to the employees who participate directly
13in preparing, serving, hosting or cleaning up the food or
14beverage function with respect to which the service charge is
15imposed.
16    (10) Until July 1, 2003, oil field exploration, drilling,
17and production equipment, including (i) rigs and parts of
18rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
19pipe and tubular goods, including casing and drill strings,
20(iii) pumps and pump-jack units, (iv) storage tanks and flow
21lines, (v) any individual replacement part for oil field
22exploration, drilling, and production equipment, and (vi)
23machinery and equipment purchased for lease; but excluding
24motor vehicles required to be registered under the Illinois
25Vehicle Code.
26    (11) Photoprocessing machinery and equipment, including

 

 

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1repair and replacement parts, both new and used, including
2that manufactured on special order, certified by the purchaser
3to be used primarily for photoprocessing, and including
4photoprocessing machinery and equipment purchased for lease.
5    (12) Coal Until July 1, 2023, coal and aggregate
6exploration, mining, off-highway hauling, processing,
7maintenance, and reclamation equipment, including replacement
8parts and equipment, and including equipment purchased for
9lease, but excluding motor vehicles required to be registered
10under the Illinois Vehicle Code. The changes made to this
11Section by Public Act 97-767 apply on and after July 1, 2003,
12but no claim for credit or refund is allowed on or after August
1316, 2013 (the effective date of Public Act 98-456) for such
14taxes paid during the period beginning July 1, 2003 and ending
15on August 16, 2013 (the effective date of Public Act 98-456).
16The exemption under this paragraph (12) for coal applies until
17July 1, 2023. The exemption under this paragraph (12) for
18aggregate exploration, mining, off-highway hauling,
19processing, maintenance, and reclamation equipment applies
20until July 1, 2028.
21    (13) Beginning January 1, 1992 and through June 30, 2016,
22food for human consumption that is to be consumed off the
23premises where it is sold (other than alcoholic beverages,
24soft drinks and food that has been prepared for immediate
25consumption) and prescription and non-prescription medicines,
26drugs, medical appliances, and insulin, urine testing

 

 

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1materials, syringes, and needles used by diabetics, for human
2use, when purchased for use by a person receiving medical
3assistance under Article V of the Illinois Public Aid Code who
4resides in a licensed long-term care facility, as defined in
5the Nursing Home Care Act, or in a licensed facility as defined
6in the ID/DD Community Care Act, the MC/DD Act, or the
7Specialized Mental Health Rehabilitation Act of 2013.
8    (14) Semen used for artificial insemination of livestock
9for direct agricultural production.
10    (15) Horses, or interests in horses, registered with and
11meeting the requirements of any of the Arabian Horse Club
12Registry of America, Appaloosa Horse Club, American Quarter
13Horse Association, United States Trotting Association, or
14Jockey Club, as appropriate, used for purposes of breeding or
15racing for prizes. This item (15) is exempt from the
16provisions of Section 3-55, and the exemption provided for
17under this item (15) applies for all periods beginning May 30,
181995, but no claim for credit or refund is allowed on or after
19January 1, 2008 (the effective date of Public Act 95-88) for
20such taxes paid during the period beginning May 30, 2000 and
21ending on January 1, 2008 (the effective date of Public Act
2295-88).
23    (16) Computers and communications equipment utilized for
24any hospital purpose and equipment used in the diagnosis,
25analysis, or treatment of hospital patients sold to a lessor
26who leases the equipment, under a lease of one year or longer

 

 

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1executed or in effect at the time of the purchase, to a
2hospital that has been issued an active tax exemption
3identification number by the Department under Section 1g of
4the Retailers' Occupation Tax Act.
5    (17) Personal property sold to a lessor who leases the
6property, under a lease of one year or longer executed or in
7effect at the time of the purchase, to a governmental body that
8has been issued an active tax exemption identification number
9by the Department under Section 1g of the Retailers'
10Occupation Tax Act.
11    (18) Beginning with taxable years ending on or after
12December 31, 1995 and ending with taxable years ending on or
13before December 31, 2004, personal property that is donated
14for disaster relief to be used in a State or federally declared
15disaster area in Illinois or bordering Illinois by a
16manufacturer or retailer that is registered in this State to a
17corporation, society, association, foundation, or institution
18that has been issued a sales tax exemption identification
19number by the Department that assists victims of the disaster
20who reside within the declared disaster area.
21    (19) Beginning with taxable years ending on or after
22December 31, 1995 and ending with taxable years ending on or
23before December 31, 2004, personal property that is used in
24the performance of infrastructure repairs in this State,
25including but not limited to municipal roads and streets,
26access roads, bridges, sidewalks, waste disposal systems,

 

 

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1water and sewer line extensions, water distribution and
2purification facilities, storm water drainage and retention
3facilities, and sewage treatment facilities, resulting from a
4State or federally declared disaster in Illinois or bordering
5Illinois when such repairs are initiated on facilities located
6in the declared disaster area within 6 months after the
7disaster.
8    (20) Beginning July 1, 1999, game or game birds sold at a
9"game breeding and hunting preserve area" as that term is used
10in the Wildlife Code. This paragraph is exempt from the
11provisions of Section 3-55.
12    (21) A motor vehicle, as that term is defined in Section
131-146 of the Illinois Vehicle Code, that is donated to a
14corporation, limited liability company, society, association,
15foundation, or institution that is determined by the
16Department to be organized and operated exclusively for
17educational purposes. For purposes of this exemption, "a
18corporation, limited liability company, society, association,
19foundation, or institution organized and operated exclusively
20for educational purposes" means all tax-supported public
21schools, private schools that offer systematic instruction in
22useful branches of learning by methods common to public
23schools and that compare favorably in their scope and
24intensity with the course of study presented in tax-supported
25schools, and vocational or technical schools or institutes
26organized and operated exclusively to provide a course of

 

 

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1study of not less than 6 weeks duration and designed to prepare
2individuals to follow a trade or to pursue a manual,
3technical, mechanical, industrial, business, or commercial
4occupation.
5    (22) Beginning January 1, 2000, personal property,
6including food, purchased through fundraising events for the
7benefit of a public or private elementary or secondary school,
8a group of those schools, or one or more school districts if
9the events are sponsored by an entity recognized by the school
10district that consists primarily of volunteers and includes
11parents and teachers of the school children. This paragraph
12does not apply to fundraising events (i) for the benefit of
13private home instruction or (ii) for which the fundraising
14entity purchases the personal property sold at the events from
15another individual or entity that sold the property for the
16purpose of resale by the fundraising entity and that profits
17from the sale to the fundraising entity. This paragraph is
18exempt from the provisions of Section 3-55.
19    (23) Beginning January 1, 2000 and through December 31,
202001, new or used automatic vending machines that prepare and
21serve hot food and beverages, including coffee, soup, and
22other items, and replacement parts for these machines.
23Beginning January 1, 2002 and through June 30, 2003, machines
24and parts for machines used in commercial, coin-operated
25amusement and vending business if a use or occupation tax is
26paid on the gross receipts derived from the use of the

 

 

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1commercial, coin-operated amusement and vending machines. This
2paragraph is exempt from the provisions of Section 3-55.
3    (24) Beginning on August 2, 2001 (the effective date of
4Public Act 92-227), computers and communications equipment
5utilized for any hospital purpose and equipment used in the
6diagnosis, analysis, or treatment of hospital patients sold to
7a lessor who leases the equipment, under a lease of one year or
8longer executed or in effect at the time of the purchase, to a
9hospital that has been issued an active tax exemption
10identification number by the Department under Section 1g of
11the Retailers' Occupation Tax Act. This paragraph is exempt
12from the provisions of Section 3-55.
13    (25) Beginning on August 2, 2001 (the effective date of
14Public Act 92-227), personal property sold to a lessor who
15leases the property, under a lease of one year or longer
16executed or in effect at the time of the purchase, to a
17governmental body that has been issued an active tax exemption
18identification number by the Department under Section 1g of
19the Retailers' Occupation Tax Act. This paragraph is exempt
20from the provisions of Section 3-55.
21    (26) Beginning on January 1, 2002 and through June 30,
222016, tangible personal property purchased from an Illinois
23retailer by a taxpayer engaged in centralized purchasing
24activities in Illinois who will, upon receipt of the property
25in Illinois, temporarily store the property in Illinois (i)
26for the purpose of subsequently transporting it outside this

 

 

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1State for use or consumption thereafter solely outside this
2State or (ii) for the purpose of being processed, fabricated,
3or manufactured into, attached to, or incorporated into other
4tangible personal property to be transported outside this
5State and thereafter used or consumed solely outside this
6State. The Director of Revenue shall, pursuant to rules
7adopted in accordance with the Illinois Administrative
8Procedure Act, issue a permit to any taxpayer in good standing
9with the Department who is eligible for the exemption under
10this paragraph (26). The permit issued under this paragraph
11(26) shall authorize the holder, to the extent and in the
12manner specified in the rules adopted under this Act, to
13purchase tangible personal property from a retailer exempt
14from the taxes imposed by this Act. Taxpayers shall maintain
15all necessary books and records to substantiate the use and
16consumption of all such tangible personal property outside of
17the State of Illinois.
18    (27) Beginning January 1, 2008, tangible personal property
19used in the construction or maintenance of a community water
20supply, as defined under Section 3.145 of the Environmental
21Protection Act, that is operated by a not-for-profit
22corporation that holds a valid water supply permit issued
23under Title IV of the Environmental Protection Act. This
24paragraph is exempt from the provisions of Section 3-55.
25    (28) Tangible personal property sold to a
26public-facilities corporation, as described in Section

 

 

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111-65-10 of the Illinois Municipal Code, for purposes of
2constructing or furnishing a municipal convention hall, but
3only if the legal title to the municipal convention hall is
4transferred to the municipality without any further
5consideration by or on behalf of the municipality at the time
6of the completion of the municipal convention hall or upon the
7retirement or redemption of any bonds or other debt
8instruments issued by the public-facilities corporation in
9connection with the development of the municipal convention
10hall. This exemption includes existing public-facilities
11corporations as provided in Section 11-65-25 of the Illinois
12Municipal Code. This paragraph is exempt from the provisions
13of Section 3-55.
14    (29) Beginning January 1, 2010 and continuing through
15December 31, 2024, materials, parts, equipment, components,
16and furnishings incorporated into or upon an aircraft as part
17of the modification, refurbishment, completion, replacement,
18repair, or maintenance of the aircraft. This exemption
19includes consumable supplies used in the modification,
20refurbishment, completion, replacement, repair, and
21maintenance of aircraft, but excludes any materials, parts,
22equipment, components, and consumable supplies used in the
23modification, replacement, repair, and maintenance of aircraft
24engines or power plants, whether such engines or power plants
25are installed or uninstalled upon any such aircraft.
26"Consumable supplies" include, but are not limited to,

 

 

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1adhesive, tape, sandpaper, general purpose lubricants,
2cleaning solution, latex gloves, and protective films. This
3exemption applies only to the transfer of qualifying tangible
4personal property incident to the modification, refurbishment,
5completion, replacement, repair, or maintenance of an aircraft
6by persons who (i) hold an Air Agency Certificate and are
7empowered to operate an approved repair station by the Federal
8Aviation Administration, (ii) have a Class IV Rating, and
9(iii) conduct operations in accordance with Part 145 of the
10Federal Aviation Regulations. The exemption does not include
11aircraft operated by a commercial air carrier providing
12scheduled passenger air service pursuant to authority issued
13under Part 121 or Part 129 of the Federal Aviation
14Regulations. The changes made to this paragraph (29) by Public
15Act 98-534 are declarative of existing law. It is the intent of
16the General Assembly that the exemption under this paragraph
17(29) applies continuously from January 1, 2010 through
18December 31, 2024; however, no claim for credit or refund is
19allowed for taxes paid as a result of the disallowance of this
20exemption on or after January 1, 2015 and prior to the
21effective date of this amendatory Act of the 101st General
22Assembly.
23    (30) Beginning January 1, 2017 and through December 31,
242026, menstrual pads, tampons, and menstrual cups.
25    (31) Tangible personal property transferred to a purchaser
26who is exempt from tax by operation of federal law. This

 

 

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1paragraph is exempt from the provisions of Section 3-55.
2    (32) Qualified tangible personal property used in the
3construction or operation of a data center that has been
4granted a certificate of exemption by the Department of
5Commerce and Economic Opportunity, whether that tangible
6personal property is purchased by the owner, operator, or
7tenant of the data center or by a contractor or subcontractor
8of the owner, operator, or tenant. Data centers that would
9have qualified for a certificate of exemption prior to January
101, 2020 had this amendatory Act of the 101st General Assembly
11been in effect, may apply for and obtain an exemption for
12subsequent purchases of computer equipment or enabling
13software purchased or leased to upgrade, supplement, or
14replace computer equipment or enabling software purchased or
15leased in the original investment that would have qualified.
16    The Department of Commerce and Economic Opportunity shall
17grant a certificate of exemption under this item (32) to
18qualified data centers as defined by Section 605-1025 of the
19Department of Commerce and Economic Opportunity Law of the
20Civil Administrative Code of Illinois.
21    For the purposes of this item (32):
22        "Data center" means a building or a series of
23    buildings rehabilitated or constructed to house working
24    servers in one physical location or multiple sites within
25    the State of Illinois.
26        "Qualified tangible personal property" means:

 

 

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1    electrical systems and equipment; climate control and
2    chilling equipment and systems; mechanical systems and
3    equipment; monitoring and secure systems; emergency
4    generators; hardware; computers; servers; data storage
5    devices; network connectivity equipment; racks; cabinets;
6    telecommunications cabling infrastructure; raised floor
7    systems; peripheral components or systems; software;
8    mechanical, electrical, or plumbing systems; battery
9    systems; cooling systems and towers; temperature control
10    systems; other cabling; and other data center
11    infrastructure equipment and systems necessary to operate
12    qualified tangible personal property, including fixtures;
13    and component parts of any of the foregoing, including
14    installation, maintenance, repair, refurbishment, and
15    replacement of qualified tangible personal property to
16    generate, transform, transmit, distribute, or manage
17    electricity necessary to operate qualified tangible
18    personal property; and all other tangible personal
19    property that is essential to the operations of a computer
20    data center. The term "qualified tangible personal
21    property" also includes building materials physically
22    incorporated in to the qualifying data center. To document
23    the exemption allowed under this Section, the retailer
24    must obtain from the purchaser a copy of the certificate
25    of eligibility issued by the Department of Commerce and
26    Economic Opportunity.

 

 

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1    This item (32) is exempt from the provisions of Section
23-55.
3(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
4101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
 
5    Section 5-20. The Retailers' Occupation Tax Act is amended
6by changing Section 2-5 as follows:
 
7    (35 ILCS 120/2-5)
8    Sec. 2-5. Exemptions. Gross receipts from proceeds from
9the sale of the following tangible personal property are
10exempt from the tax imposed by this Act:
11        (1) Farm chemicals.
12        (2) Farm machinery and equipment, both new and used,
13    including that manufactured on special order, certified by
14    the purchaser to be used primarily for production
15    agriculture or State or federal agricultural programs,
16    including individual replacement parts for the machinery
17    and equipment, including machinery and equipment purchased
18    for lease, and including implements of husbandry defined
19    in Section 1-130 of the Illinois Vehicle Code, farm
20    machinery and agricultural chemical and fertilizer
21    spreaders, and nurse wagons required to be registered
22    under Section 3-809 of the Illinois Vehicle Code, but
23    excluding other motor vehicles required to be registered
24    under the Illinois Vehicle Code. Horticultural polyhouses

 

 

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1    or hoop houses used for propagating, growing, or
2    overwintering plants shall be considered farm machinery
3    and equipment under this item (2). Agricultural chemical
4    tender tanks and dry boxes shall include units sold
5    separately from a motor vehicle required to be licensed
6    and units sold mounted on a motor vehicle required to be
7    licensed, if the selling price of the tender is separately
8    stated.
9        Farm machinery and equipment shall include precision
10    farming equipment that is installed or purchased to be
11    installed on farm machinery and equipment including, but
12    not limited to, tractors, harvesters, sprayers, planters,
13    seeders, or spreaders. Precision farming equipment
14    includes, but is not limited to, soil testing sensors,
15    computers, monitors, software, global positioning and
16    mapping systems, and other such equipment.
17        Farm machinery and equipment also includes computers,
18    sensors, software, and related equipment used primarily in
19    the computer-assisted operation of production agriculture
20    facilities, equipment, and activities such as, but not
21    limited to, the collection, monitoring, and correlation of
22    animal and crop data for the purpose of formulating animal
23    diets and agricultural chemicals. This item (2) is exempt
24    from the provisions of Section 2-70.
25        (3) Until July 1, 2003, distillation machinery and
26    equipment, sold as a unit or kit, assembled or installed

 

 

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1    by the retailer, certified by the user to be used only for
2    the production of ethyl alcohol that will be used for
3    consumption as motor fuel or as a component of motor fuel
4    for the personal use of the user, and not subject to sale
5    or resale.
6        (4) Until July 1, 2003 and beginning again September
7    1, 2004 through August 30, 2014, graphic arts machinery
8    and equipment, including repair and replacement parts,
9    both new and used, and including that manufactured on
10    special order or purchased for lease, certified by the
11    purchaser to be used primarily for graphic arts
12    production. Equipment includes chemicals or chemicals
13    acting as catalysts but only if the chemicals or chemicals
14    acting as catalysts effect a direct and immediate change
15    upon a graphic arts product. Beginning on July 1, 2017,
16    graphic arts machinery and equipment is included in the
17    manufacturing and assembling machinery and equipment
18    exemption under paragraph (14).
19        (5) A motor vehicle that is used for automobile
20    renting, as defined in the Automobile Renting Occupation
21    and Use Tax Act. This paragraph is exempt from the
22    provisions of Section 2-70.
23        (6) Personal property sold by a teacher-sponsored
24    student organization affiliated with an elementary or
25    secondary school located in Illinois.
26        (7) Until July 1, 2003, proceeds of that portion of

 

 

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1    the selling price of a passenger car the sale of which is
2    subject to the Replacement Vehicle Tax.
3        (8) Personal property sold to an Illinois county fair
4    association for use in conducting, operating, or promoting
5    the county fair.
6        (9) Personal property sold to a not-for-profit arts or
7    cultural organization that establishes, by proof required
8    by the Department by rule, that it has received an
9    exemption under Section 501(c)(3) of the Internal Revenue
10    Code and that is organized and operated primarily for the
11    presentation or support of arts or cultural programming,
12    activities, or services. These organizations include, but
13    are not limited to, music and dramatic arts organizations
14    such as symphony orchestras and theatrical groups, arts
15    and cultural service organizations, local arts councils,
16    visual arts organizations, and media arts organizations.
17    On and after July 1, 2001 (the effective date of Public Act
18    92-35), however, an entity otherwise eligible for this
19    exemption shall not make tax-free purchases unless it has
20    an active identification number issued by the Department.
21        (10) Personal property sold by a corporation, society,
22    association, foundation, institution, or organization,
23    other than a limited liability company, that is organized
24    and operated as a not-for-profit service enterprise for
25    the benefit of persons 65 years of age or older if the
26    personal property was not purchased by the enterprise for

 

 

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1    the purpose of resale by the enterprise.
2        (11) Personal property sold to a governmental body, to
3    a corporation, society, association, foundation, or
4    institution organized and operated exclusively for
5    charitable, religious, or educational purposes, or to a
6    not-for-profit corporation, society, association,
7    foundation, institution, or organization that has no
8    compensated officers or employees and that is organized
9    and operated primarily for the recreation of persons 55
10    years of age or older. A limited liability company may
11    qualify for the exemption under this paragraph only if the
12    limited liability company is organized and operated
13    exclusively for educational purposes. On and after July 1,
14    1987, however, no entity otherwise eligible for this
15    exemption shall make tax-free purchases unless it has an
16    active identification number issued by the Department.
17        (12) (Blank).
18        (12-5) On and after July 1, 2003 and through June 30,
19    2004, motor vehicles of the second division with a gross
20    vehicle weight in excess of 8,000 pounds that are subject
21    to the commercial distribution fee imposed under Section
22    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
23    2004 and through June 30, 2005, the use in this State of
24    motor vehicles of the second division: (i) with a gross
25    vehicle weight rating in excess of 8,000 pounds; (ii) that
26    are subject to the commercial distribution fee imposed

 

 

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1    under Section 3-815.1 of the Illinois Vehicle Code; and
2    (iii) that are primarily used for commercial purposes.
3    Through June 30, 2005, this exemption applies to repair
4    and replacement parts added after the initial purchase of
5    such a motor vehicle if that motor vehicle is used in a
6    manner that would qualify for the rolling stock exemption
7    otherwise provided for in this Act. For purposes of this
8    paragraph, "used for commercial purposes" means the
9    transportation of persons or property in furtherance of
10    any commercial or industrial enterprise whether for-hire
11    or not.
12        (13) Proceeds from sales to owners, lessors, or
13    shippers of tangible personal property that is utilized by
14    interstate carriers for hire for use as rolling stock
15    moving in interstate commerce and equipment operated by a
16    telecommunications provider, licensed as a common carrier
17    by the Federal Communications Commission, which is
18    permanently installed in or affixed to aircraft moving in
19    interstate commerce.
20        (14) Machinery and equipment that will be used by the
21    purchaser, or a lessee of the purchaser, primarily in the
22    process of manufacturing or assembling tangible personal
23    property for wholesale or retail sale or lease, whether
24    the sale or lease is made directly by the manufacturer or
25    by some other person, whether the materials used in the
26    process are owned by the manufacturer or some other

 

 

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1    person, or whether the sale or lease is made apart from or
2    as an incident to the seller's engaging in the service
3    occupation of producing machines, tools, dies, jigs,
4    patterns, gauges, or other similar items of no commercial
5    value on special order for a particular purchaser. The
6    exemption provided by this paragraph (14) does not include
7    machinery and equipment used in (i) the generation of
8    electricity for wholesale or retail sale; (ii) the
9    generation or treatment of natural or artificial gas for
10    wholesale or retail sale that is delivered to customers
11    through pipes, pipelines, or mains; or (iii) the treatment
12    of water for wholesale or retail sale that is delivered to
13    customers through pipes, pipelines, or mains. The
14    provisions of Public Act 98-583 are declaratory of
15    existing law as to the meaning and scope of this
16    exemption. Beginning on July 1, 2017, the exemption
17    provided by this paragraph (14) includes, but is not
18    limited to, graphic arts machinery and equipment, as
19    defined in paragraph (4) of this Section.
20        (15) Proceeds of mandatory service charges separately
21    stated on customers' bills for purchase and consumption of
22    food and beverages, to the extent that the proceeds of the
23    service charge are in fact turned over as tips or as a
24    substitute for tips to the employees who participate
25    directly in preparing, serving, hosting or cleaning up the
26    food or beverage function with respect to which the

 

 

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1    service charge is imposed.
2        (16) Tangible personal property sold to a purchaser if
3    the purchaser is exempt from use tax by operation of
4    federal law. This paragraph is exempt from the provisions
5    of Section 2-70.
6        (17) Tangible personal property sold to a common
7    carrier by rail or motor that receives the physical
8    possession of the property in Illinois and that transports
9    the property, or shares with another common carrier in the
10    transportation of the property, out of Illinois on a
11    standard uniform bill of lading showing the seller of the
12    property as the shipper or consignor of the property to a
13    destination outside Illinois, for use outside Illinois.
14        (18) Legal tender, currency, medallions, or gold or
15    silver coinage issued by the State of Illinois, the
16    government of the United States of America, or the
17    government of any foreign country, and bullion.
18        (19) Until July 1, 2003, oil field exploration,
19    drilling, and production equipment, including (i) rigs and
20    parts of rigs, rotary rigs, cable tool rigs, and workover
21    rigs, (ii) pipe and tubular goods, including casing and
22    drill strings, (iii) pumps and pump-jack units, (iv)
23    storage tanks and flow lines, (v) any individual
24    replacement part for oil field exploration, drilling, and
25    production equipment, and (vi) machinery and equipment
26    purchased for lease; but excluding motor vehicles required

 

 

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1    to be registered under the Illinois Vehicle Code.
2        (20) Photoprocessing machinery and equipment,
3    including repair and replacement parts, both new and used,
4    including that manufactured on special order, certified by
5    the purchaser to be used primarily for photoprocessing,
6    and including photoprocessing machinery and equipment
7    purchased for lease.
8        (21) Coal Until July 1, 2023, coal and aggregate
9    exploration, mining, off-highway hauling, processing,
10    maintenance, and reclamation equipment, including
11    replacement parts and equipment, and including equipment
12    purchased for lease, but excluding motor vehicles required
13    to be registered under the Illinois Vehicle Code. The
14    changes made to this Section by Public Act 97-767 apply on
15    and after July 1, 2003, but no claim for credit or refund
16    is allowed on or after August 16, 2013 (the effective date
17    of Public Act 98-456) for such taxes paid during the
18    period beginning July 1, 2003 and ending on August 16,
19    2013 (the effective date of Public Act 98-456). The
20    exemption under this paragraph (21) for coal applies until
21    July 1, 2023. The exemption under this paragraph (21) for
22    aggregate exploration, mining, off-highway hauling,
23    processing, maintenance, and reclamation equipment applies
24    until July 1, 2028.
25        (22) Until June 30, 2013, fuel and petroleum products
26    sold to or used by an air carrier, certified by the carrier

 

 

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1    to be used for consumption, shipment, or storage in the
2    conduct of its business as an air common carrier, for a
3    flight destined for or returning from a location or
4    locations outside the United States without regard to
5    previous or subsequent domestic stopovers.
6        Beginning July 1, 2013, fuel and petroleum products
7    sold to or used by an air carrier, certified by the carrier
8    to be used for consumption, shipment, or storage in the
9    conduct of its business as an air common carrier, for a
10    flight that (i) is engaged in foreign trade or is engaged
11    in trade between the United States and any of its
12    possessions and (ii) transports at least one individual or
13    package for hire from the city of origination to the city
14    of final destination on the same aircraft, without regard
15    to a change in the flight number of that aircraft.
16        (23) A transaction in which the purchase order is
17    received by a florist who is located outside Illinois, but
18    who has a florist located in Illinois deliver the property
19    to the purchaser or the purchaser's donee in Illinois.
20        (24) Fuel consumed or used in the operation of ships,
21    barges, or vessels that are used primarily in or for the
22    transportation of property or the conveyance of persons
23    for hire on rivers bordering on this State if the fuel is
24    delivered by the seller to the purchaser's barge, ship, or
25    vessel while it is afloat upon that bordering river.
26        (25) Except as provided in item (25-5) of this

 

 

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1    Section, a motor vehicle sold in this State to a
2    nonresident even though the motor vehicle is delivered to
3    the nonresident in this State, if the motor vehicle is not
4    to be titled in this State, and if a drive-away permit is
5    issued to the motor vehicle as provided in Section 3-603
6    of the Illinois Vehicle Code or if the nonresident
7    purchaser has vehicle registration plates to transfer to
8    the motor vehicle upon returning to his or her home state.
9    The issuance of the drive-away permit or having the
10    out-of-state registration plates to be transferred is
11    prima facie evidence that the motor vehicle will not be
12    titled in this State.
13        (25-5) The exemption under item (25) does not apply if
14    the state in which the motor vehicle will be titled does
15    not allow a reciprocal exemption for a motor vehicle sold
16    and delivered in that state to an Illinois resident but
17    titled in Illinois. The tax collected under this Act on
18    the sale of a motor vehicle in this State to a resident of
19    another state that does not allow a reciprocal exemption
20    shall be imposed at a rate equal to the state's rate of tax
21    on taxable property in the state in which the purchaser is
22    a resident, except that the tax shall not exceed the tax
23    that would otherwise be imposed under this Act. At the
24    time of the sale, the purchaser shall execute a statement,
25    signed under penalty of perjury, of his or her intent to
26    title the vehicle in the state in which the purchaser is a

 

 

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1    resident within 30 days after the sale and of the fact of
2    the payment to the State of Illinois of tax in an amount
3    equivalent to the state's rate of tax on taxable property
4    in his or her state of residence and shall submit the
5    statement to the appropriate tax collection agency in his
6    or her state of residence. In addition, the retailer must
7    retain a signed copy of the statement in his or her
8    records. Nothing in this item shall be construed to
9    require the removal of the vehicle from this state
10    following the filing of an intent to title the vehicle in
11    the purchaser's state of residence if the purchaser titles
12    the vehicle in his or her state of residence within 30 days
13    after the date of sale. The tax collected under this Act in
14    accordance with this item (25-5) shall be proportionately
15    distributed as if the tax were collected at the 6.25%
16    general rate imposed under this Act.
17        (25-7) Beginning on July 1, 2007, no tax is imposed
18    under this Act on the sale of an aircraft, as defined in
19    Section 3 of the Illinois Aeronautics Act, if all of the
20    following conditions are met:
21            (1) the aircraft leaves this State within 15 days
22        after the later of either the issuance of the final
23        billing for the sale of the aircraft, or the
24        authorized approval for return to service, completion
25        of the maintenance record entry, and completion of the
26        test flight and ground test for inspection, as

 

 

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1        required by 14 C.F.R. 91.407;
2            (2) the aircraft is not based or registered in
3        this State after the sale of the aircraft; and
4            (3) the seller retains in his or her books and
5        records and provides to the Department a signed and
6        dated certification from the purchaser, on a form
7        prescribed by the Department, certifying that the
8        requirements of this item (25-7) are met. The
9        certificate must also include the name and address of
10        the purchaser, the address of the location where the
11        aircraft is to be titled or registered, the address of
12        the primary physical location of the aircraft, and
13        other information that the Department may reasonably
14        require.
15        For purposes of this item (25-7):
16        "Based in this State" means hangared, stored, or
17    otherwise used, excluding post-sale customizations as
18    defined in this Section, for 10 or more days in each
19    12-month period immediately following the date of the sale
20    of the aircraft.
21        "Registered in this State" means an aircraft
22    registered with the Department of Transportation,
23    Aeronautics Division, or titled or registered with the
24    Federal Aviation Administration to an address located in
25    this State.
26        This paragraph (25-7) is exempt from the provisions of

 

 

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1    Section 2-70.
2        (26) Semen used for artificial insemination of
3    livestock for direct agricultural production.
4        (27) Horses, or interests in horses, registered with
5    and meeting the requirements of any of the Arabian Horse
6    Club Registry of America, Appaloosa Horse Club, American
7    Quarter Horse Association, United States Trotting
8    Association, or Jockey Club, as appropriate, used for
9    purposes of breeding or racing for prizes. This item (27)
10    is exempt from the provisions of Section 2-70, and the
11    exemption provided for under this item (27) applies for
12    all periods beginning May 30, 1995, but no claim for
13    credit or refund is allowed on or after January 1, 2008
14    (the effective date of Public Act 95-88) for such taxes
15    paid during the period beginning May 30, 2000 and ending
16    on January 1, 2008 (the effective date of Public Act
17    95-88).
18        (28) Computers and communications equipment utilized
19    for any hospital purpose and equipment used in the
20    diagnosis, analysis, or treatment of hospital patients
21    sold to a lessor who leases the equipment, under a lease of
22    one year or longer executed or in effect at the time of the
23    purchase, to a hospital that has been issued an active tax
24    exemption identification number by the Department under
25    Section 1g of this Act.
26        (29) Personal property sold to a lessor who leases the

 

 

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1    property, under a lease of one year or longer executed or
2    in effect at the time of the purchase, to a governmental
3    body that has been issued an active tax exemption
4    identification number by the Department under Section 1g
5    of this Act.
6        (30) Beginning with taxable years ending on or after
7    December 31, 1995 and ending with taxable years ending on
8    or before December 31, 2004, personal property that is
9    donated for disaster relief to be used in a State or
10    federally declared disaster area in Illinois or bordering
11    Illinois by a manufacturer or retailer that is registered
12    in this State to a corporation, society, association,
13    foundation, or institution that has been issued a sales
14    tax exemption identification number by the Department that
15    assists victims of the disaster who reside within the
16    declared disaster area.
17        (31) Beginning with taxable years ending on or after
18    December 31, 1995 and ending with taxable years ending on
19    or before December 31, 2004, personal property that is
20    used in the performance of infrastructure repairs in this
21    State, including but not limited to municipal roads and
22    streets, access roads, bridges, sidewalks, waste disposal
23    systems, water and sewer line extensions, water
24    distribution and purification facilities, storm water
25    drainage and retention facilities, and sewage treatment
26    facilities, resulting from a State or federally declared

 

 

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1    disaster in Illinois or bordering Illinois when such
2    repairs are initiated on facilities located in the
3    declared disaster area within 6 months after the disaster.
4        (32) Beginning July 1, 1999, game or game birds sold
5    at a "game breeding and hunting preserve area" as that
6    term is used in the Wildlife Code. This paragraph is
7    exempt from the provisions of Section 2-70.
8        (33) A motor vehicle, as that term is defined in
9    Section 1-146 of the Illinois Vehicle Code, that is
10    donated to a corporation, limited liability company,
11    society, association, foundation, or institution that is
12    determined by the Department to be organized and operated
13    exclusively for educational purposes. For purposes of this
14    exemption, "a corporation, limited liability company,
15    society, association, foundation, or institution organized
16    and operated exclusively for educational purposes" means
17    all tax-supported public schools, private schools that
18    offer systematic instruction in useful branches of
19    learning by methods common to public schools and that
20    compare favorably in their scope and intensity with the
21    course of study presented in tax-supported schools, and
22    vocational or technical schools or institutes organized
23    and operated exclusively to provide a course of study of
24    not less than 6 weeks duration and designed to prepare
25    individuals to follow a trade or to pursue a manual,
26    technical, mechanical, industrial, business, or commercial

 

 

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1    occupation.
2        (34) Beginning January 1, 2000, personal property,
3    including food, purchased through fundraising events for
4    the benefit of a public or private elementary or secondary
5    school, a group of those schools, or one or more school
6    districts if the events are sponsored by an entity
7    recognized by the school district that consists primarily
8    of volunteers and includes parents and teachers of the
9    school children. This paragraph does not apply to
10    fundraising events (i) for the benefit of private home
11    instruction or (ii) for which the fundraising entity
12    purchases the personal property sold at the events from
13    another individual or entity that sold the property for
14    the purpose of resale by the fundraising entity and that
15    profits from the sale to the fundraising entity. This
16    paragraph is exempt from the provisions of Section 2-70.
17        (35) Beginning January 1, 2000 and through December
18    31, 2001, new or used automatic vending machines that
19    prepare and serve hot food and beverages, including
20    coffee, soup, and other items, and replacement parts for
21    these machines. Beginning January 1, 2002 and through June
22    30, 2003, machines and parts for machines used in
23    commercial, coin-operated amusement and vending business
24    if a use or occupation tax is paid on the gross receipts
25    derived from the use of the commercial, coin-operated
26    amusement and vending machines. This paragraph is exempt

 

 

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1    from the provisions of Section 2-70.
2        (35-5) Beginning August 23, 2001 and through June 30,
3    2016, food for human consumption that is to be consumed
4    off the premises where it is sold (other than alcoholic
5    beverages, soft drinks, and food that has been prepared
6    for immediate consumption) and prescription and
7    nonprescription medicines, drugs, medical appliances, and
8    insulin, urine testing materials, syringes, and needles
9    used by diabetics, for human use, when purchased for use
10    by a person receiving medical assistance under Article V
11    of the Illinois Public Aid Code who resides in a licensed
12    long-term care facility, as defined in the Nursing Home
13    Care Act, or a licensed facility as defined in the ID/DD
14    Community Care Act, the MC/DD Act, or the Specialized
15    Mental Health Rehabilitation Act of 2013.
16        (36) Beginning August 2, 2001, computers and
17    communications equipment utilized for any hospital purpose
18    and equipment used in the diagnosis, analysis, or
19    treatment of hospital patients sold to a lessor who leases
20    the equipment, under a lease of one year or longer
21    executed or in effect at the time of the purchase, to a
22    hospital that has been issued an active tax exemption
23    identification number by the Department under Section 1g
24    of this Act. This paragraph is exempt from the provisions
25    of Section 2-70.
26        (37) Beginning August 2, 2001, personal property sold

 

 

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1    to a lessor who leases the property, under a lease of one
2    year or longer executed or in effect at the time of the
3    purchase, to a governmental body that has been issued an
4    active tax exemption identification number by the
5    Department under Section 1g of this Act. This paragraph is
6    exempt from the provisions of Section 2-70.
7        (38) Beginning on January 1, 2002 and through June 30,
8    2016, tangible personal property purchased from an
9    Illinois retailer by a taxpayer engaged in centralized
10    purchasing activities in Illinois who will, upon receipt
11    of the property in Illinois, temporarily store the
12    property in Illinois (i) for the purpose of subsequently
13    transporting it outside this State for use or consumption
14    thereafter solely outside this State or (ii) for the
15    purpose of being processed, fabricated, or manufactured
16    into, attached to, or incorporated into other tangible
17    personal property to be transported outside this State and
18    thereafter used or consumed solely outside this State. The
19    Director of Revenue shall, pursuant to rules adopted in
20    accordance with the Illinois Administrative Procedure Act,
21    issue a permit to any taxpayer in good standing with the
22    Department who is eligible for the exemption under this
23    paragraph (38). The permit issued under this paragraph
24    (38) shall authorize the holder, to the extent and in the
25    manner specified in the rules adopted under this Act, to
26    purchase tangible personal property from a retailer exempt

 

 

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1    from the taxes imposed by this Act. Taxpayers shall
2    maintain all necessary books and records to substantiate
3    the use and consumption of all such tangible personal
4    property outside of the State of Illinois.
5        (39) Beginning January 1, 2008, tangible personal
6    property used in the construction or maintenance of a
7    community water supply, as defined under Section 3.145 of
8    the Environmental Protection Act, that is operated by a
9    not-for-profit corporation that holds a valid water supply
10    permit issued under Title IV of the Environmental
11    Protection Act. This paragraph is exempt from the
12    provisions of Section 2-70.
13        (40) Beginning January 1, 2010 and continuing through
14    December 31, 2024, materials, parts, equipment,
15    components, and furnishings incorporated into or upon an
16    aircraft as part of the modification, refurbishment,
17    completion, replacement, repair, or maintenance of the
18    aircraft. This exemption includes consumable supplies used
19    in the modification, refurbishment, completion,
20    replacement, repair, and maintenance of aircraft, but
21    excludes any materials, parts, equipment, components, and
22    consumable supplies used in the modification, replacement,
23    repair, and maintenance of aircraft engines or power
24    plants, whether such engines or power plants are installed
25    or uninstalled upon any such aircraft. "Consumable
26    supplies" include, but are not limited to, adhesive, tape,

 

 

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1    sandpaper, general purpose lubricants, cleaning solution,
2    latex gloves, and protective films. This exemption applies
3    only to the sale of qualifying tangible personal property
4    to persons who modify, refurbish, complete, replace, or
5    maintain an aircraft and who (i) hold an Air Agency
6    Certificate and are empowered to operate an approved
7    repair station by the Federal Aviation Administration,
8    (ii) have a Class IV Rating, and (iii) conduct operations
9    in accordance with Part 145 of the Federal Aviation
10    Regulations. The exemption does not include aircraft
11    operated by a commercial air carrier providing scheduled
12    passenger air service pursuant to authority issued under
13    Part 121 or Part 129 of the Federal Aviation Regulations.
14    The changes made to this paragraph (40) by Public Act
15    98-534 are declarative of existing law. It is the intent
16    of the General Assembly that the exemption under this
17    paragraph (40) applies continuously from January 1, 2010
18    through December 31, 2024; however, no claim for credit or
19    refund is allowed for taxes paid as a result of the
20    disallowance of this exemption on or after January 1, 2015
21    and prior to the effective date of this amendatory Act of
22    the 101st General Assembly.
23        (41) Tangible personal property sold to a
24    public-facilities corporation, as described in Section
25    11-65-10 of the Illinois Municipal Code, for purposes of
26    constructing or furnishing a municipal convention hall,

 

 

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1    but only if the legal title to the municipal convention
2    hall is transferred to the municipality without any
3    further consideration by or on behalf of the municipality
4    at the time of the completion of the municipal convention
5    hall or upon the retirement or redemption of any bonds or
6    other debt instruments issued by the public-facilities
7    corporation in connection with the development of the
8    municipal convention hall. This exemption includes
9    existing public-facilities corporations as provided in
10    Section 11-65-25 of the Illinois Municipal Code. This
11    paragraph is exempt from the provisions of Section 2-70.
12        (42) Beginning January 1, 2017 and through December
13    31, 2026, menstrual pads, tampons, and menstrual cups.
14        (43) Merchandise that is subject to the Rental
15    Purchase Agreement Occupation and Use Tax. The purchaser
16    must certify that the item is purchased to be rented
17    subject to a rental purchase agreement, as defined in the
18    Rental Purchase Agreement Act, and provide proof of
19    registration under the Rental Purchase Agreement
20    Occupation and Use Tax Act. This paragraph is exempt from
21    the provisions of Section 2-70.
22        (44) Qualified tangible personal property used in the
23    construction or operation of a data center that has been
24    granted a certificate of exemption by the Department of
25    Commerce and Economic Opportunity, whether that tangible
26    personal property is purchased by the owner, operator, or

 

 

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1    tenant of the data center or by a contractor or
2    subcontractor of the owner, operator, or tenant. Data
3    centers that would have qualified for a certificate of
4    exemption prior to January 1, 2020 had this amendatory Act
5    of the 101st General Assembly been in effect, may apply
6    for and obtain an exemption for subsequent purchases of
7    computer equipment or enabling software purchased or
8    leased to upgrade, supplement, or replace computer
9    equipment or enabling software purchased or leased in the
10    original investment that would have qualified.
11        The Department of Commerce and Economic Opportunity
12    shall grant a certificate of exemption under this item
13    (44) to qualified data centers as defined by Section
14    605-1025 of the Department of Commerce and Economic
15    Opportunity Law of the Civil Administrative Code of
16    Illinois.
17        For the purposes of this item (44):
18            "Data center" means a building or a series of
19        buildings rehabilitated or constructed to house
20        working servers in one physical location or multiple
21        sites within the State of Illinois.
22            "Qualified tangible personal property" means:
23        electrical systems and equipment; climate control and
24        chilling equipment and systems; mechanical systems and
25        equipment; monitoring and secure systems; emergency
26        generators; hardware; computers; servers; data storage

 

 

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1        devices; network connectivity equipment; racks;
2        cabinets; telecommunications cabling infrastructure;
3        raised floor systems; peripheral components or
4        systems; software; mechanical, electrical, or plumbing
5        systems; battery systems; cooling systems and towers;
6        temperature control systems; other cabling; and other
7        data center infrastructure equipment and systems
8        necessary to operate qualified tangible personal
9        property, including fixtures; and component parts of
10        any of the foregoing, including installation,
11        maintenance, repair, refurbishment, and replacement of
12        qualified tangible personal property to generate,
13        transform, transmit, distribute, or manage electricity
14        necessary to operate qualified tangible personal
15        property; and all other tangible personal property
16        that is essential to the operations of a computer data
17        center. The term "qualified tangible personal
18        property" also includes building materials physically
19        incorporated into in to the qualifying data center. To
20        document the exemption allowed under this Section, the
21        retailer must obtain from the purchaser a copy of the
22        certificate of eligibility issued by the Department of
23        Commerce and Economic Opportunity.
24        This item (44) is exempt from the provisions of
25    Section 2-70.
26        (45) Beginning January 1, 2020 and through December

 

 

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1    31, 2020, sales of tangible personal property made by a
2    marketplace seller over a marketplace for which tax is due
3    under this Act but for which use tax has been collected and
4    remitted to the Department by a marketplace facilitator
5    under Section 2d of the Use Tax Act are exempt from tax
6    under this Act. A marketplace seller claiming this
7    exemption shall maintain books and records demonstrating
8    that the use tax on such sales has been collected and
9    remitted by a marketplace facilitator. Marketplace sellers
10    that have properly remitted tax under this Act on such
11    sales may file a claim for credit as provided in Section 6
12    of this Act. No claim is allowed, however, for such taxes
13    for which a credit or refund has been issued to the
14    marketplace facilitator under the Use Tax Act, or for
15    which the marketplace facilitator has filed a claim for
16    credit or refund under the Use Tax Act.
17(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
18101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff.
198-27-21; revised 11-9-21.)
 
20
ARTICLE 10. EDGE-SUNSET

 
21    Section 10-5. The Economic Development for a Growing
22Economy Tax Credit Act is amended by changing Section 5-77 as
23follows:
 

 

 

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1    (35 ILCS 10/5-77)
2    Sec. 5-77. Sunset of new Agreements. The Department shall
3not enter into any new Agreements under the provisions of
4Section 5-50 of this Act after June 30, 2027 2022.
5(Source: P.A. 99-925, eff. 1-20-17; 100-511, eff. 9-18-17.)
 
6
ARTICLE 15. EDGE-STARTUPS

 
7    Section 15-5. The Economic Development for a Growing
8Economy Tax Credit Act is amended by changing Sections 5-5,
95-15, and 5-20 as follows:
 
10    (35 ILCS 10/5-5)
11    Sec. 5-5. Definitions. As used in this Act:
12    "Agreement" means the Agreement between a Taxpayer and the
13Department under the provisions of Section 5-50 of this Act.
14    "Applicant" means a Taxpayer that is operating a business
15located or that the Taxpayer plans to locate within the State
16of Illinois and that is engaged in interstate or intrastate
17commerce for the purpose of manufacturing, processing,
18assembling, warehousing, or distributing products, conducting
19research and development, providing tourism services, or
20providing services in interstate commerce, office industries,
21or agricultural processing, but excluding retail, retail food,
22health, or professional services. "Applicant" does not include
23a Taxpayer who closes or substantially reduces an operation at

 

 

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1one location in the State and relocates substantially the same
2operation to another location in the State. This does not
3prohibit a Taxpayer from expanding its operations at another
4location in the State, provided that existing operations of a
5similar nature located within the State are not closed or
6substantially reduced. This also does not prohibit a Taxpayer
7from moving its operations from one location in the State to
8another location in the State for the purpose of expanding the
9operation provided that the Department determines that
10expansion cannot reasonably be accommodated within the
11municipality in which the business is located, or in the case
12of a business located in an incorporated area of the county,
13within the county in which the business is located, after
14conferring with the chief elected official of the municipality
15or county and taking into consideration any evidence offered
16by the municipality or county regarding the ability to
17accommodate expansion within the municipality or county.
18    "Credit" means the amount agreed to between the Department
19and Applicant under this Act, but not to exceed the lesser of:
20(1) the sum of (i) 50% of the Incremental Income Tax
21attributable to New Employees at the Applicant's project and
22(ii) 10% of the training costs of New Employees; or (2) 100% of
23the Incremental Income Tax attributable to New Employees at
24the Applicant's project. However, if the project is located in
25an underserved area, then the amount of the Credit may not
26exceed the lesser of: (1) the sum of (i) 75% of the Incremental

 

 

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1Income Tax attributable to New Employees at the Applicant's
2project and (ii) 10% of the training costs of New Employees; or
3(2) 100% of the Incremental Income Tax attributable to New
4Employees at the Applicant's project. If an Applicant agrees
5to hire the required number of New Employees, then the maximum
6amount of the Credit for that Applicant may be increased by an
7amount not to exceed 25% of the Incremental Income Tax
8attributable to retained employees at the Applicant's project;
9provided that, in order to receive the increase for retained
10employees, the Applicant must provide the additional evidence
11required under paragraph (3) of subsection (b) of Section
125-25.
13    "Department" means the Department of Commerce and Economic
14Opportunity.
15    "Director" means the Director of Commerce and Economic
16Opportunity.
17    "Full-time Employee" means an individual who is employed
18for consideration for at least 35 hours each week or who
19renders any other standard of service generally accepted by
20industry custom or practice as full-time employment. An
21individual for whom a W-2 is issued by a Professional Employer
22Organization (PEO) is a full-time employee if employed in the
23service of the Applicant for consideration for at least 35
24hours each week or who renders any other standard of service
25generally accepted by industry custom or practice as full-time
26employment to Applicant.

 

 

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1    "Incremental Income Tax" means the total amount withheld
2during the taxable year from the compensation of New Employees
3and, if applicable, retained employees under Article 7 of the
4Illinois Income Tax Act arising from employment at a project
5that is the subject of an Agreement.
6    "New Construction EDGE Agreement" means the Agreement
7between a Taxpayer and the Department under the provisions of
8Section 5-51 of this Act.
9    "New Construction EDGE Credit" means an amount agreed to
10between the Department and the Applicant under this Act as
11part of a New Construction EDGE Agreement that does not exceed
1250% of the Incremental Income Tax attributable to New
13Construction EDGE Employees at the Applicant's project;
14however, if the New Construction EDGE Project is located in an
15underserved area, then the amount of the New Construction EDGE
16Credit may not exceed 75% of the Incremental Income Tax
17attributable to New Construction EDGE Employees at the
18Applicant's New Construction EDGE Project.
19    "New Construction EDGE Employee" means a laborer or worker
20who is employed by an Illinois contractor or subcontractor in
21the actual construction work on the site of a New Construction
22EDGE Project, pursuant to a New Construction EDGE Agreement.
23    "New Construction EDGE Incremental Income Tax" means the
24total amount withheld during the taxable year from the
25compensation of New Construction EDGE Employees.
26    "New Construction EDGE Project" means the building of a

 

 

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1Taxpayer's structure or building, or making improvements of
2any kind to real property. "New Construction EDGE Project"
3does not include the routine operation, routine repair, or
4routine maintenance of existing structures, buildings, or real
5property.
6    "New Employee" means:
7        (a) A Full-time Employee first employed by a Taxpayer
8    in the project that is the subject of an Agreement and who
9    is hired after the Taxpayer enters into the tax credit
10    Agreement.
11        (b) The term "New Employee" does not include:
12            (1) an employee of the Taxpayer who performs a job
13        that was previously performed by another employee, if
14        that job existed for at least 6 months before hiring
15        the employee;
16            (2) an employee of the Taxpayer who was previously
17        employed in Illinois by a Related Member of the
18        Taxpayer and whose employment was shifted to the
19        Taxpayer after the Taxpayer entered into the tax
20        credit Agreement; or
21            (3) a child, grandchild, parent, or spouse, other
22        than a spouse who is legally separated from the
23        individual, of any individual who has a direct or an
24        indirect ownership interest of at least 5% in the
25        profits, capital, or value of the Taxpayer.
26        (c) Notwithstanding paragraph (1) of subsection (b),

 

 

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1    an employee may be considered a New Employee under the
2    Agreement if the employee performs a job that was
3    previously performed by an employee who was:
4            (1) treated under the Agreement as a New Employee;
5        and
6            (2) promoted by the Taxpayer to another job.
7        (d) Notwithstanding subsection (a), the Department may
8    award Credit to an Applicant with respect to an employee
9    hired prior to the date of the Agreement if:
10            (1) the Applicant is in receipt of a letter from
11        the Department stating an intent to enter into a
12        credit Agreement;
13            (2) the letter described in paragraph (1) is
14        issued by the Department not later than 15 days after
15        the effective date of this Act; and
16            (3) the employee was hired after the date the
17        letter described in paragraph (1) was issued.
18    "Noncompliance Date" means, in the case of a Taxpayer that
19is not complying with the requirements of the Agreement or the
20provisions of this Act, the day following the last date upon
21which the Taxpayer was in compliance with the requirements of
22the Agreement and the provisions of this Act, as determined by
23the Director, pursuant to Section 5-65.
24    "Pass Through Entity" means an entity that is exempt from
25the tax under subsection (b) or (c) of Section 205 of the
26Illinois Income Tax Act.

 

 

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1    "Professional Employer Organization" (PEO) means an
2employee leasing company, as defined in Section 206.1(A)(2) of
3the Illinois Unemployment Insurance Act.
4    "Related Member" means a person that, with respect to the
5Taxpayer during any portion of the taxable year, is any one of
6the following:
7        (1) An individual stockholder, if the stockholder and
8    the members of the stockholder's family (as defined in
9    Section 318 of the Internal Revenue Code) own directly,
10    indirectly, beneficially, or constructively, in the
11    aggregate, at least 50% of the value of the Taxpayer's
12    outstanding stock.
13        (2) A partnership, estate, or trust and any partner or
14    beneficiary, if the partnership, estate, or trust, and its
15    partners or beneficiaries own directly, indirectly,
16    beneficially, or constructively, in the aggregate, at
17    least 50% of the profits, capital, stock, or value of the
18    Taxpayer.
19        (3) A corporation, and any party related to the
20    corporation in a manner that would require an attribution
21    of stock from the corporation to the party or from the
22    party to the corporation under the attribution rules of
23    Section 318 of the Internal Revenue Code, if the Taxpayer
24    owns directly, indirectly, beneficially, or constructively
25    at least 50% of the value of the corporation's outstanding
26    stock.

 

 

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1        (4) A corporation and any party related to that
2    corporation in a manner that would require an attribution
3    of stock from the corporation to the party or from the
4    party to the corporation under the attribution rules of
5    Section 318 of the Internal Revenue Code, if the
6    corporation and all such related parties own in the
7    aggregate at least 50% of the profits, capital, stock, or
8    value of the Taxpayer.
9        (5) A person to or from whom there is attribution of
10    stock ownership in accordance with Section 1563(e) of the
11    Internal Revenue Code, except, for purposes of determining
12    whether a person is a Related Member under this paragraph,
13    20% shall be substituted for 5% wherever 5% appears in
14    Section 1563(e) of the Internal Revenue Code.
15    "Startup taxpayer" means a corporation, partnership, or
16other entity incorporated or organized no more than 5 years
17before the filing of an application for an Agreement that has
18never had any Illinois income tax liability, excluding any
19Illinois income tax liability of a Related Member which shall
20not be attributed to the startup taxpayer.
21    "Taxpayer" means an individual, corporation, partnership,
22or other entity that has any Illinois Income Tax liability.
23    "Underserved area" means a geographic area that meets one
24or more of the following conditions:
25        (1) the area has a poverty rate of at least 20%
26    according to the latest American Community Survey federal

 

 

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1    decennial census;
2        (2) 35% or more of the families with children in the
3    area are living below 130% of the poverty line, according
4    to the latest American Community Survey 75% or more of the
5    children in the area participate in the federal free lunch
6    program according to reported statistics from the State
7    Board of Education;
8        (3) at least 20% of the households in the area receive
9    assistance under the Supplemental Nutrition Assistance
10    Program (SNAP); or
11        (4) the area has an average unemployment rate, as
12    determined by the Illinois Department of Employment
13    Security, that is more than 120% of the national
14    unemployment average, as determined by the U.S. Department
15    of Labor, for a period of at least 2 consecutive calendar
16    years preceding the date of the application.
17(Source: P.A. 101-9, eff. 6-5-19; 102-330, eff. 1-1-22.)
 
18    (35 ILCS 10/5-15)
19    Sec. 5-15. Tax Credit Awards. Subject to the conditions
20set forth in this Act, a Taxpayer is entitled to a Credit
21against or, as described in subsection (g) of this Section, a
22payment towards taxes imposed pursuant to subsections (a) and
23(b) of Section 201 of the Illinois Income Tax Act that may be
24imposed on the Taxpayer for a taxable year beginning on or
25after January 1, 1999, if the Taxpayer is awarded a Credit by

 

 

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1the Department under this Act for that taxable year.
2    (a) The Department shall make Credit awards under this Act
3to foster job creation and retention in Illinois.
4    (b) A person that proposes a project to create new jobs in
5Illinois must enter into an Agreement with the Department for
6the Credit under this Act.
7    (c) The Credit shall be claimed for the taxable years
8specified in the Agreement.
9    (d) The Credit shall not exceed the Incremental Income Tax
10attributable to the project that is the subject of the
11Agreement.
12    (e) Nothing herein shall prohibit a Tax Credit Award to an
13Applicant that uses a PEO if all other award criteria are
14satisfied.
15    (f) In lieu of the Credit allowed under this Act against
16the taxes imposed pursuant to subsections (a) and (b) of
17Section 201 of the Illinois Income Tax Act for any taxable year
18ending on or after December 31, 2009, for Taxpayers that
19entered into Agreements prior to January 1, 2015 and otherwise
20meet the criteria set forth in this subsection (f), the
21Taxpayer may elect to claim the Credit against its obligation
22to pay over withholding under Section 704A of the Illinois
23Income Tax Act.
24        (1) The election under this subsection (f) may be made
25    only by a Taxpayer that (i) is primarily engaged in one of
26    the following business activities: water purification and

 

 

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1    treatment, motor vehicle metal stamping, automobile
2    manufacturing, automobile and light duty motor vehicle
3    manufacturing, motor vehicle manufacturing, light truck
4    and utility vehicle manufacturing, heavy duty truck
5    manufacturing, motor vehicle body manufacturing, cable
6    television infrastructure design or manufacturing, or
7    wireless telecommunication or computing terminal device
8    design or manufacturing for use on public networks and
9    (ii) meets the following criteria:
10            (A) the Taxpayer (i) had an Illinois net loss or an
11        Illinois net loss deduction under Section 207 of the
12        Illinois Income Tax Act for the taxable year in which
13        the Credit is awarded, (ii) employed a minimum of
14        1,000 full-time employees in this State during the
15        taxable year in which the Credit is awarded, (iii) has
16        an Agreement under this Act on December 14, 2009 (the
17        effective date of Public Act 96-834), and (iv) is in
18        compliance with all provisions of that Agreement;
19            (B) the Taxpayer (i) had an Illinois net loss or an
20        Illinois net loss deduction under Section 207 of the
21        Illinois Income Tax Act for the taxable year in which
22        the Credit is awarded, (ii) employed a minimum of
23        1,000 full-time employees in this State during the
24        taxable year in which the Credit is awarded, and (iii)
25        has applied for an Agreement within 365 days after
26        December 14, 2009 (the effective date of Public Act

 

 

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1        96-834);
2            (C) the Taxpayer (i) had an Illinois net operating
3        loss carryforward under Section 207 of the Illinois
4        Income Tax Act in a taxable year ending during
5        calendar year 2008, (ii) has applied for an Agreement
6        within 150 days after the effective date of this
7        amendatory Act of the 96th General Assembly, (iii)
8        creates at least 400 new jobs in Illinois, (iv)
9        retains at least 2,000 jobs in Illinois that would
10        have been at risk of relocation out of Illinois over a
11        10-year period, and (v) makes a capital investment of
12        at least $75,000,000;
13            (D) the Taxpayer (i) had an Illinois net operating
14        loss carryforward under Section 207 of the Illinois
15        Income Tax Act in a taxable year ending during
16        calendar year 2009, (ii) has applied for an Agreement
17        within 150 days after the effective date of this
18        amendatory Act of the 96th General Assembly, (iii)
19        creates at least 150 new jobs, (iv) retains at least
20        1,000 jobs in Illinois that would have been at risk of
21        relocation out of Illinois over a 10-year period, and
22        (v) makes a capital investment of at least
23        $57,000,000; or
24            (E) the Taxpayer (i) employed at least 2,500
25        full-time employees in the State during the year in
26        which the Credit is awarded, (ii) commits to make at

 

 

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1        least $500,000,000 in combined capital improvements
2        and project costs under the Agreement, (iii) applies
3        for an Agreement between January 1, 2011 and June 30,
4        2011, (iv) executes an Agreement for the Credit during
5        calendar year 2011, and (v) was incorporated no more
6        than 5 years before the filing of an application for an
7        Agreement.
8        (1.5) The election under this subsection (f) may also
9    be made by a Taxpayer for any Credit awarded pursuant to an
10    agreement that was executed between January 1, 2011 and
11    June 30, 2011, if the Taxpayer (i) is primarily engaged in
12    the manufacture of inner tubes or tires, or both, from
13    natural and synthetic rubber, (ii) employs a minimum of
14    2,400 full-time employees in Illinois at the time of
15    application, (iii) creates at least 350 full-time jobs and
16    retains at least 250 full-time jobs in Illinois that would
17    have been at risk of being created or retained outside of
18    Illinois, and (iv) makes a capital investment of at least
19    $200,000,000 at the project location.
20        (1.6) The election under this subsection (f) may also
21    be made by a Taxpayer for any Credit awarded pursuant to an
22    agreement that was executed within 150 days after the
23    effective date of this amendatory Act of the 97th General
24    Assembly, if the Taxpayer (i) is primarily engaged in the
25    operation of a discount department store, (ii) maintains
26    its corporate headquarters in Illinois, (iii) employs a

 

 

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1    minimum of 4,250 full-time employees at its corporate
2    headquarters in Illinois at the time of application, (iv)
3    retains at least 4,250 full-time jobs in Illinois that
4    would have been at risk of being relocated outside of
5    Illinois, (v) had a minimum of $40,000,000,000 in total
6    revenue in 2010, and (vi) makes a capital investment of at
7    least $300,000,000 at the project location.
8        (1.7) Notwithstanding any other provision of law, the
9    election under this subsection (f) may also be made by a
10    Taxpayer for any Credit awarded pursuant to an agreement
11    that was executed or applied for on or after July 1, 2011
12    and on or before March 31, 2012, if the Taxpayer is
13    primarily engaged in the manufacture of original and
14    aftermarket filtration parts and products for automobiles,
15    motor vehicles, light duty motor vehicles, light trucks
16    and utility vehicles, and heavy duty trucks, (ii) employs
17    a minimum of 1,000 full-time employees in Illinois at the
18    time of application, (iii) creates at least 250 full-time
19    jobs in Illinois, (iv) relocates its corporate
20    headquarters to Illinois from another state, and (v) makes
21    a capital investment of at least $4,000,000 at the project
22    location.
23        (1.8) Notwithstanding any other provision of law, the
24    election under this subsection (f) may also be made by a
25    startup taxpayer for any Credit awarded pursuant to an
26    Agreement that was executed or applied for on or after the

 

 

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1    effective date of this amendatory Act of the 102nd General
2    Assembly, if the startup taxpayer, without considering any
3    Related Member or other investor, (i) has never had any
4    Illinois income tax liability and (ii) was incorporated or
5    organized no more than 5 years before the filing of an
6    application for an Agreement. Any such election under this
7    paragraph (1.8) shall be effective unless and until such
8    startup taxpayer has any Illinois income tax liability.
9    This election under this paragraph (1.8) shall
10    automatically terminate when the startup taxpayer has any
11    Illinois income tax liability at the end of any taxable
12    year during the term of the Agreement. Thereafter, the
13    startup taxpayer may receive a Credit, taking into account
14    any benefits previously enjoyed or received by way of the
15    election under this paragraph (1.8), so long as the
16    startup taxpayer remains in compliance with the terms and
17    conditions of the Agreement.
18        (2) An election under this subsection shall allow the
19    credit to be taken against payments otherwise due under
20    Section 704A of the Illinois Income Tax Act during the
21    first calendar year beginning after the end of the taxable
22    year in which the credit is awarded under this Act.
23        (3) The election shall be made in the form and manner
24    required by the Illinois Department of Revenue and, once
25    made, shall be irrevocable.
26        (4) If a Taxpayer who meets the requirements of

 

 

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1    subparagraph (A) of paragraph (1) of this subsection (f)
2    elects to claim the Credit against its withholdings as
3    provided in this subsection (f), then, on and after the
4    date of the election, the terms of the Agreement between
5    the Taxpayer and the Department may not be further amended
6    during the term of the Agreement.
7    (g) A pass-through entity that has been awarded a credit
8under this Act, its shareholders, or its partners may treat
9some or all of the credit awarded pursuant to this Act as a tax
10payment for purposes of the Illinois Income Tax Act. The term
11"tax payment" means a payment as described in Article 6 or
12Article 8 of the Illinois Income Tax Act or a composite payment
13made by a pass-through entity on behalf of any of its
14shareholders or partners to satisfy such shareholders' or
15partners' taxes imposed pursuant to subsections (a) and (b) of
16Section 201 of the Illinois Income Tax Act. In no event shall
17the amount of the award credited pursuant to this Act exceed
18the Illinois income tax liability of the pass-through entity
19or its shareholders or partners for the taxable year.
20(Source: P.A. 100-511, eff. 9-18-17.)
 
21    (35 ILCS 10/5-20)
22    Sec. 5-20. Application for a project to create and retain
23new jobs.
24    (a) Any Taxpayer proposing a project located or planned to
25be located in Illinois may request consideration for

 

 

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1designation of its project, by formal written letter of
2request or by formal application to the Department, in which
3the Applicant states its intent to make at least a specified
4level of investment and intends to hire or retain a specified
5number of full-time employees at a designated location in
6Illinois. As circumstances require, the Department may require
7a formal application from an Applicant and a formal letter of
8request for assistance.
9    (b) In order to qualify for Credits under this Act, an
10Applicant's project must:
11        (1) if the Applicant has more than 100 employees,
12    involve an investment of at least $2,500,000 in capital
13    improvements to be placed in service within the State as a
14    direct result of the project; if the Applicant has 100 or
15    fewer employees, then there is no capital investment
16    requirement;
17        (1.5) if the Applicant has more than 100 employees,
18    employ a number of new employees in the State equal to the
19    lesser of (A) 10% of the number of full-time employees
20    employed by the applicant world-wide on the date the
21    application is filed with the Department or (B) 50 New
22    Employees; and, if the Applicant has 100 or fewer
23    employees, employ a number of new employees in the State
24    equal to the lesser of (A) 5% of the number of full-time
25    employees employed by the applicant world-wide on the date
26    the application is filed with the Department or (B) 50 New

 

 

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1    Employees;
2        (1.6) if the Applicant is a startup taxpayer, the
3    employees employed by Related Members shall not be
4    attributed to the Applicant for purposes of determining
5    the capital investment or job creation requirements under
6    this subsection (b);
7        (2) (blank);
8        (3) (blank); and
9        (4) include an annual sexual harassment policy report
10    as provided under Section 5-58.
11    (c) After receipt of an application, the Department may
12enter into an Agreement with the Applicant if the application
13is accepted in accordance with Section 5-25.
14(Source: P.A. 100-511, eff. 9-18-17; 100-698, eff. 1-1-19;
15101-81, eff. 7-12-19.)
 
16
ARTICLE 20. EARNED INCOME TAX CREDIT

 
17    Section 20-5. The Illinois Income Tax Act is amended by
18changing Sections 212 and 225 as follows:
 
19    (35 ILCS 5/212)
20    Sec. 212. Earned income tax credit.
21    (a) With respect to the federal earned income tax credit
22allowed for the taxable year under Section 32 of the federal
23Internal Revenue Code, 26 U.S.C. 32, each individual taxpayer

 

 

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1is entitled to a credit against the tax imposed by subsections
2(a) and (b) of Section 201 in an amount equal to (i) 5% of the
3federal tax credit for each taxable year beginning on or after
4January 1, 2000 and ending prior to December 31, 2012, (ii)
57.5% of the federal tax credit for each taxable year beginning
6on or after January 1, 2012 and ending prior to December 31,
72013, (iii) 10% of the federal tax credit for each taxable year
8beginning on or after January 1, 2013 and beginning prior to
9January 1, 2017, (iv) 14% of the federal tax credit for each
10taxable year beginning on or after January 1, 2017 and
11beginning prior to January 1, 2018, and (v) 18% of the federal
12tax credit for each taxable year beginning on or after January
131, 2018 and beginning prior to January 1, 2023, and (vi) 20% of
14the federal tax credit for each taxable year beginning on or
15after January 1, 2023.
16    For a non-resident or part-year resident, the amount of
17the credit under this Section shall be in proportion to the
18amount of income attributable to this State.
19    (b) For taxable years beginning before January 1, 2003, in
20no event shall a credit under this Section reduce the
21taxpayer's liability to less than zero. For each taxable year
22beginning on or after January 1, 2003, if the amount of the
23credit exceeds the income tax liability for the applicable tax
24year, then the excess credit shall be refunded to the
25taxpayer. The amount of a refund shall not be included in the
26taxpayer's income or resources for the purposes of determining

 

 

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1eligibility or benefit level in any means-tested benefit
2program administered by a governmental entity unless required
3by federal law.
4    (b-5) For taxable years beginning on or after January 1,
52023, each individual taxpayer who has attained the age of 18
6during the taxable year but has not yet attained the age of 25
7is entitled to the credit under paragraph (a) based on the
8federal tax credit for which the taxpayer would have been
9eligible without regard to any age requirements that would
10otherwise apply to individuals without a qualifying child in
11Section 32(c)(1)(A)(ii) of the federal Internal Revenue Code.
12    (b-10) For taxable years beginning on or after January
131,2023, each individual taxpayer who has attained the age of
1465 or older during the taxable year is entitled to the credit
15under paragraph (a) based on the federal tax credit for which
16the taxpayer would have been eligible without regard to any
17age requirements that would otherwise apply to individuals
18without a qualifying child in Section 32(c)(1)(A)(ii) of the
19federal Internal Revenue Code.
20    (b-15) For taxable years beginning on or after January
211,2023, each individual taxpayer filing a return using an
22individual taxpayer identification number (ITIN) as prescribed
23under Section 6109 of the Internal Revenue Code, other than a
24Social Security number issued pursuant to Section 205(c)(2)(A)
25of the Social Security Act, is entitled to the credit under
26paragraph (a) based on the federal tax credit for which they

 

 

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1would have been eligible without applying the restrictions
2regarding social security numbers in Section 32(m) of the
3federal Internal Revenue Code.
4    (c) This Section is exempt from the provisions of Section
5250.
6(Source: P.A. 100-22, eff. 7-6-17.)
 
7
ARTICLE 25. INCOME TAX-INSTRUCTIONAL MATERIALS

 
8    Section 25-5. The Illinois Income Tax Act is amended by
9changing Section 225 as follows:
 
10    (35 ILCS 5/225)
11    Sec. 225. Credit for instructional materials and supplies.
12For taxable years beginning on and after January 1, 2017, a
13taxpayer shall be allowed a credit in the amount paid by the
14taxpayer during the taxable year for instructional materials
15and supplies with respect to classroom based instruction in a
16qualified school, or the maximum credit amount $250, whichever
17is less, provided that the taxpayer is a teacher, instructor,
18counselor, principal, or aide in a qualified school for at
19least 900 hours during a school year.
20    The credit may not be carried back and may not reduce the
21taxpayer's liability to less than zero. If the amount of the
22credit exceeds the tax liability for the year, the excess may
23be carried forward and applied to the tax liability of the 5

 

 

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1taxable years following the excess credit year. The tax credit
2shall be applied to the earliest year for which there is a tax
3liability. If there are credits for more than one year that are
4available to offset a liability, the earlier credit shall be
5applied first.
6    For purposes of this Section, the term "materials and
7supplies" means amounts paid for instructional materials or
8supplies that are designated for classroom use in any
9qualified school. For purposes of this Section, the term
10"qualified school" means a public school or non-public school
11located in Illinois.
12    For purposes of this Section, the term "maximum credit
13amount" means (i) $250 for taxable years beginning prior to
14January 1, 2023 and (ii) $500 for taxable years beginning on or
15after January 1, 2023.
16    This Section is exempt from the provisions of Section 250.
17(Source: P.A. 100-22, eff. 7-6-17.)
 
18
ARTICLE 30. ELECTRIC VEHICLES

 
19    Section 30-5. The Reimagining Electric Vehicles in
20Illinois Act is amended by changing Sections 10 and 20 as
21follows:
 
22    (20 ILCS 686/10)
23    Sec. 10. Definitions. As used in this Act:

 

 

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1    "Advanced battery" means a battery that consists of a
2battery cell that can be integrated into a module, pack, or
3system to be used in energy storage applications, including a
4battery used in an electric vehicle or the electric grid.
5    "Advanced battery component" means a component of an
6advanced battery, including materials, enhancements,
7enclosures, anodes, cathodes, electrolytes, cells, and other
8associated technologies that comprise an advanced battery.
9    "Agreement" means the agreement between a taxpayer and the
10Department under the provisions of Section 45 of this Act.
11    "Applicant" means a taxpayer that (i) operates a business
12in Illinois or is planning to locate a business within the
13State of Illinois and (ii) is engaged in interstate or
14intrastate commerce for the purpose of manufacturing electric
15vehicles, electric vehicle component parts, or electric
16vehicle power supply equipment or is engaged in interstate or
17intrastate commerce as a battery raw materials refining
18service provider or a battery recycling and reuse
19manufacturer. "Applicant" does not include a taxpayer who
20closes or substantially reduces by more than 50% operations at
21one location in the State and relocates substantially the same
22operation to another location in the State. This does not
23prohibit a Taxpayer from expanding its operations at another
24location in the State. This also does not prohibit a Taxpayer
25from moving its operations from one location in the State to
26another location in the State for the purpose of expanding the

 

 

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1operation, provided that the Department determines that
2expansion cannot reasonably be accommodated within the
3municipality or county in which the business is located, or,
4in the case of a business located in an incorporated area of
5the county, within the county in which the business is
6located, after conferring with the chief elected official of
7the municipality or county and taking into consideration any
8evidence offered by the municipality or county regarding the
9ability to accommodate expansion within the municipality or
10county.
11    "Battery raw materials" means the raw and processed form
12of a mineral, metal, chemical, or other material used in an
13advanced battery component.
14    "Battery raw materials refining service provider" means a
15business that operates a facility that filters, sifts, and
16treats battery raw materials for use in an advanced battery.
17    "Battery recycling and reuse manufacturer" means a
18manufacturer that is primarily engaged in the recovery,
19retrieval, processing, recycling, or recirculating of battery
20raw materials for new use in electric vehicle batteries.
21    "Capital improvements" means the purchase, renovation,
22rehabilitation, or construction of permanent tangible land,
23buildings, structures, equipment, and furnishings in an
24approved project sited in Illinois and expenditures for goods
25or services that are normally capitalized, including
26organizational costs and research and development costs

 

 

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1incurred in Illinois. For land, buildings, structures, and
2equipment that are leased, the lease must equal or exceed the
3term of the agreement, and the cost of the property shall be
4determined from the present value, using the corporate
5interest rate prevailing at the time of the application, of
6the lease payments.
7    "Credit" means either a "REV Illinois Credit" or a "REV
8Construction Jobs Credit" agreed to between the Department and
9applicant under this Act.
10    "Department" means the Department of Commerce and Economic
11Opportunity.
12    "Director" means the Director of Commerce and Economic
13Opportunity.
14    "Electric vehicle" means a vehicle that is exclusively
15powered by and refueled by electricity, including, but not
16limited to, electricity generated through a hydrogen fuel cell
17or solar technology, must be plugged in to charge or utilize a
18pre-charged battery, and is permitted to operate on public
19roadways. "Electric vehicle" does not include hybrid electric
20vehicles, electric bicycles, and extended-range electric
21vehicles that are also equipped with conventional fueled
22propulsion or auxiliary engines.
23    "Electric vehicle manufacturer" means a new or existing
24manufacturer that is focused on reequipping, expanding, or
25establishing a manufacturing facility in Illinois that
26produces electric vehicles as defined in this Section.

 

 

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1    "Electric vehicle component parts manufacturer" means a
2new or existing manufacturer that is primarily focused on
3reequipping, expanding, or establishing a manufacturing
4facility in Illinois that produces advanced battery components
5or key components that directly support the electric functions
6of electric vehicles, as defined by this Section.
7    "Electric vehicle power supply equipment" means the
8equipment used specifically for the purpose of delivering
9electricity to an electric vehicle, including, but not limited
10to, hydrogen fuel cells or solar refueling infrastructure.
11    "Electric vehicle power supply manufacturer" means a new
12or existing manufacturer that is focused on reequipping,
13expanding, or establishing a manufacturing facility in
14Illinois that produces electric vehicle power supply equipment
15used for the purpose of delivering electricity to an electric
16vehicle.
17    "Energy Transition Area" means a county with less than
18100,000 people or a municipality that contains one or more of
19the following:
20        (1) a fossil fuel plant that was retired from service
21    or has significant reduced service within 6 years before
22    the time of the application or will be retired or have
23    service significantly reduced within 6 years following the
24    time of the application; or
25        (2) a coal mine that was closed or had operations
26    significantly reduced within 6 years before the time of

 

 

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1    the application or is anticipated to be closed or have
2    operations significantly reduced within 6 years following
3    the time of the application.
4    "Full-time employee" means an individual who is employed
5for consideration for at least 35 hours each week or who
6renders any other standard of service generally accepted by
7industry custom or practice as full-time employment. An
8individual for whom a W-2 is issued by a Professional Employer
9Organization (PEO) is a full-time employee if employed in the
10service of the applicant for consideration for at least 35
11hours each week.
12    "Incremental income tax" means the total amount withheld
13during the taxable year from the compensation of new employees
14and, if applicable, retained employees under Article 7 of the
15Illinois Income Tax Act arising from employment at a project
16that is the subject of an agreement.
17    "Institution of higher education" or "institution" means
18any accredited public or private university, college,
19community college, business, technical, or vocational school,
20or other accredited educational institution offering degrees
21and instruction beyond the secondary school level.
22    "Minority person" means a minority person as defined in
23the Business Enterprise for Minorities, Women, and Persons
24with Disabilities Act.
25    "New employee" means a newly-hired full-time employee
26employed to work at the project site and whose work is directly

 

 

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1related to the project.
2    "Noncompliance date" means, in the case of a taxpayer that
3is not complying with the requirements of the agreement or the
4provisions of this Act, the day following the last date upon
5which the taxpayer was in compliance with the requirements of
6the agreement and the provisions of this Act, as determined by
7the Director, pursuant to Section 70.
8    "Pass-through entity" means an entity that is exempt from
9the tax under subsection (b) or (c) of Section 205 of the
10Illinois Income Tax Act.
11    "Placed in service" means the state or condition of
12readiness, availability for a specifically assigned function,
13and the facility is constructed and ready to conduct its
14facility operations to manufacture goods.
15    "Professional employer organization" (PEO) means an
16employee leasing company, as defined in Section 206.1 of the
17Illinois Unemployment Insurance Act.
18    "Program" means the Reimagining Electric Vehicles in
19Illinois Program (the REV Illinois Program) established in
20this Act.
21    "Project" or "REV Illinois Project" means a for-profit
22economic development activity for the manufacture of electric
23vehicles, electric vehicle component parts, or electric
24vehicle power supply equipment which is designated by the
25Department as a REV Illinois Project and is the subject of an
26agreement.

 

 

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1    "Recycling facility" means a location at which the
2taxpayer disposes of batteries and other component parts in
3manufacturing of electric vehicles, electric vehicle component
4parts, or electric vehicle power supply equipment.
5    "Related member" means a person that, with respect to the
6taxpayer during any portion of the taxable year, is any one of
7the following:
8        (1) An individual stockholder, if the stockholder and
9    the members of the stockholder's family (as defined in
10    Section 318 of the Internal Revenue Code) own directly,
11    indirectly, beneficially, or constructively, in the
12    aggregate, at least 50% of the value of the taxpayer's
13    outstanding stock.
14        (2) A partnership, estate, trust and any partner or
15    beneficiary, if the partnership, estate, or trust, and its
16    partners or beneficiaries own directly, indirectly,
17    beneficially, or constructively, in the aggregate, at
18    least 50% of the profits, capital, stock, or value of the
19    taxpayer.
20        (3) A corporation, and any party related to the
21    corporation in a manner that would require an attribution
22    of stock from the corporation under the attribution rules
23    of Section 318 of the Internal Revenue Code, if the
24    Taxpayer owns directly, indirectly, beneficially, or
25    constructively at least 50% of the value of the
26    corporation's outstanding stock.

 

 

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1        (4) A corporation and any party related to that
2    corporation in a manner that would require an attribution
3    of stock from the corporation to the party or from the
4    party to the corporation under the attribution rules of
5    Section 318 of the Internal Revenue Code, if the
6    corporation and all such related parties own in the
7    aggregate at least 50% of the profits, capital, stock, or
8    value of the taxpayer.
9        (5) A person to or from whom there is an attribution of
10    stock ownership in accordance with Section 1563(e) of the
11    Internal Revenue Code, except, for purposes of determining
12    whether a person is a related member under this paragraph,
13    20% shall be substituted for 5% wherever 5% appears in
14    Section 1563(e) of the Internal Revenue Code.
15    "Retained employee" means a full-time employee employed by
16the taxpayer prior to the term of the Agreement who continues
17to be employed during the term of the agreement whose job
18duties are directly and substantially related to the project.
19For purposes of this definition, "directly and substantially
20related to the project" means at least two-thirds of the
21employee's job duties must be directly related to the project
22and the employee must devote at least two-thirds of his or her
23time to the project. The term "retained employee" does not
24include any individual who has a direct or an indirect
25ownership interest of at least 5% in the profits, equity,
26capital, or value of the taxpayer or a child, grandchild,

 

 

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1parent, or spouse, other than a spouse who is legally
2separated from the individual, of any individual who has a
3direct or indirect ownership of at least 5% in the profits,
4equity, capital, or value of the taxpayer.
5    "REV Illinois credit" means a credit agreed to between the
6Department and the applicant under this Act that is based on
7the incremental income tax attributable to new employees and,
8if applicable, retained employees, and on training costs for
9such employees at the applicant's project.
10    "REV construction jobs credit" means a credit agreed to
11between the Department and the applicant under this Act that
12is based on the incremental income tax attributable to
13construction wages paid in connection with construction of the
14project facilities.
15    "Statewide baseline" means the total number of full-time
16employees of the applicant and any related member employed by
17such entities at the time of application for incentives under
18this Act.
19    "Taxpayer" means an individual, corporation, partnership,
20or other entity that has a legal obligation to pay Illinois
21income taxes and file an Illinois income tax return.
22    "Training costs" means costs incurred to upgrade the
23technological skills of full-time employees in Illinois and
24includes: curriculum development; training materials
25(including scrap product costs); trainee domestic travel
26expenses; instructor costs (including wages, fringe benefits,

 

 

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1tuition and domestic travel expenses); rent, purchase or lease
2of training equipment; and other usual and customary training
3costs. "Training costs" do not include costs associated with
4travel outside the United States (unless the Taxpayer receives
5prior written approval for the travel by the Director based on
6a showing of substantial need or other proof the training is
7not reasonably available within the United States), wages and
8fringe benefits of employees during periods of training, or
9administrative cost related to full-time employees of the
10taxpayer.
11    "Underserved area" means any geographic areas as defined
12in Section 5-5 of the Economic Development for a Growing
13Economy Tax Credit Act.
14(Source: P.A. 102-669, eff. 11-16-21.)
 
15    (20 ILCS 686/20)
16    Sec. 20. REV Illinois Program; project applications.
17    (a) The Reimagining Electric Vehicles in Illinois (REV
18Illinois) Program is hereby established and shall be
19administered by the Department. The Program will provide
20financial incentives to any one or more of the following: (1)
21eligible manufacturers of electric vehicles, electric vehicle
22component parts, and electric vehicle power supply equipment;
23(2) battery recycling and reuse manufacturers; or (3) battery
24raw materials refining service providers.
25    (b) Any taxpayer planning a project to be located in

 

 

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1Illinois may request consideration for designation of its
2project as a REV Illinois Project, by formal written letter of
3request or by formal application to the Department, in which
4the applicant states its intent to make at least a specified
5level of investment and intends to hire a specified number of
6full-time employees at a designated location in Illinois. As
7circumstances require, the Department shall require a formal
8application from an applicant and a formal letter of request
9for assistance.
10    (c) In order to qualify for credits under the REV Illinois
11Program, an Applicant must:
12        (1) for an electric vehicle manufacturer:
13            (A) make an investment of at least $1,500,000,000
14        in capital improvements at the project site;
15            (B) to be placed in service within the State
16        within a 60-month period after approval of the
17        application; and
18            (C) create at least 500 new full-time employee
19        jobs; or
20        (2) for an electric vehicle component parts
21    manufacturer:
22            (A) make an investment of at least $300,000,000 in
23        capital improvements at the project site;
24            (B) manufacture one or more parts that are
25        primarily used for electric vehicle manufacturing;
26            (C) to be placed in service within the State

 

 

10200HB1497ham001- 113 -LRB102 03513 HLH 38716 a

1        within a 60-month period after approval of the
2        application; and
3            (D) create at least 150 new full-time employee
4        jobs; or
5        (3) for an electric vehicle manufacturer, an electric
6    vehicle power supply equipment manufacturer Manufacturer,
7    an or electric vehicle component part manufacturer that
8    does not qualify quality under paragraph (2) above, a
9    battery recycling and reuse manufacturer, or a battery raw
10    materials refining service provider:
11            (A) make an investment of at least $20,000,000 in
12        capital improvements at the project site;
13            (B) for electric vehicle component part
14        manufacturers, manufacture one or more parts that are
15        primarily used for electric vehicle manufacturing;
16            (C) to be placed in service within the State
17        within a 48-month period after approval of the
18        application; and
19            (D) create at least 50 new full-time employee
20        jobs; or
21        (4) for an electric vehicle manufacturer or electric
22    vehicle component parts manufacturer with existing
23    operations within Illinois that intends to convert or
24    expand, in whole or in part, the existing facility from
25    traditional manufacturing to electric vehicle
26    manufacturing, electric vehicle component parts

 

 

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1    manufacturing, or electric vehicle power supply equipment
2    manufacturing:
3            (A) make an investment of at least $100,000,000 in
4        capital improvements at the project site;
5            (B) to be placed in service within the State
6        within a 60-month period after approval of the
7        application; and
8            (C) create the lesser of 75 new full-time employee
9        jobs or new full-time employee jobs equivalent to 10%
10        of the Statewide baseline applicable to the taxpayer
11        and any related member at the time of application.
12    (d) For agreements entered into prior to the effective
13date of this amendatory Act of the 102nd General Assembly, for
14For any applicant creating the full-time employee jobs noted
15in subsection (c), those jobs must have a total compensation
16equal to or greater than 120% of the average wage paid to
17full-time employees in the county where the project is
18located, as determined by the U.S. Bureau of Labor Statistics.
19For agreements entered into on or after the effective date of
20this amendatory Act of the 102nd General Assembly, for any
21applicant creating the full-time employee jobs noted in
22subsection (c), those jobs must have a compensation equal to
23or greater than 120% of the average wage paid to full-time
24employees in a similar position within an occupational group
25in the county where the project is located, as determined by
26the U.S. Bureau of Labor Statistics.

 

 

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1    (e) For any applicant, within 24 months after being placed
2in service, it must certify to the Department that it is carbon
3neutral or has attained certification under one of more of the
4following green building standards:
5        (1) BREEAM for New Construction or BREEAM In-Use;
6        (2) ENERGY STAR;
7        (3) Envision;
8        (4) ISO 50001 - energy management;
9        (5) LEED for Building Design and Construction or LEED
10    for Building Operations and Maintenance;
11        (6) Green Globes for New Construction or Green Globes
12    for Existing Buildings; or
13        (7) UL 3223.
14    (f) Each applicant must outline its hiring plan and
15commitment to recruit and hire full-time employee positions at
16the project site. The hiring plan may include a partnership
17with an institution of higher education to provide
18internships, including, but not limited to, internships
19supported by the Clean Jobs Workforce Network Program, or
20full-time permanent employment for students at the project
21site. Additionally, the applicant may create or utilize
22participants from apprenticeship programs that are approved by
23and registered with the United States Department of Labor's
24Bureau of Apprenticeship and Training. The Applicant may apply
25for apprenticeship education expense credits in accordance
26with the provisions set forth in 14 Ill. Admin. Code 522. Each

 

 

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1applicant is required to report annually, on or before April
215, on the diversity of its workforce in accordance with
3Section 50 of this Act. For existing facilities of applicants
4under paragraph (3) of subsection (b) above, if the taxpayer
5expects a reduction in force due to its transition to
6manufacturing electric vehicle, electric vehicle component
7parts, or electric vehicle power supply equipment, the plan
8submitted under this Section must outline the taxpayer's plan
9to assist with retraining its workforce aligned with the
10taxpayer's adoption of new technologies and anticipated
11efforts to retrain employees through employment opportunities
12within the taxpayer's workforce.
13    (g) Each applicant must demonstrate a contractual or other
14relationship with a recycling facility, or demonstrate its own
15recycling capabilities, at the time of application and report
16annually a continuing contractual or other relationship with a
17recycling facility and the percentage of batteries used in
18electric vehicles recycled throughout the term of the
19agreement.
20    (h) A taxpayer may not enter into more than one agreement
21under this Act with respect to a single address or location for
22the same period of time. Also, a taxpayer may not enter into an
23agreement under this Act with respect to a single address or
24location for the same period of time for which the taxpayer
25currently holds an active agreement under the Economic
26Development for a Growing Economy Tax Credit Act. This

 

 

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1provision does not preclude the applicant from entering into
2an additional agreement after the expiration or voluntary
3termination of an earlier agreement under this Act or under
4the Economic Development for a Growing Economy Tax Credit Act
5to the extent that the taxpayer's application otherwise
6satisfies the terms and conditions of this Act and is approved
7by the Department. An applicant with an existing agreement
8under the Economic Development for a Growing Economy Tax
9Credit Act may submit an application for an agreement under
10this Act after it terminates any existing agreement under the
11Economic Development for a Growing Economy Tax Credit Act with
12respect to the same address or location.
13(Source: P.A. 102-669, eff. 11-16-21.)
 
14
ARTICLE 35. RIVER EDGE

 
15    Section 35-5. The River Edge Redevelopment Zone Act is
16amended by changing Section 10-3 as follows:
 
17    (65 ILCS 115/10-3)
18    Sec. 10-3. Definitions. As used in this Act:
19    "Department" means the Department of Commerce and Economic
20Opportunity.
21    "River Edge Redevelopment Zone" means an area of the State
22certified by the Department as a River Edge Redevelopment Zone
23pursuant to this Act.

 

 

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1    "Designated zone organization" means an association or
2entity: (1) the members of which are substantially all
3residents of the River Edge Redevelopment Zone or of the
4municipality in which the River Edge Redevelopment Zone is
5located; (2) the board of directors of which is elected by the
6members of the organization; (3) that satisfies the criteria
7set forth in Section 501(c) (3) or 501(c) (4) of the Internal
8Revenue Code; and (4) that exists primarily for the purpose of
9performing within the zone, for the benefit of the residents
10and businesses thereof, any of the functions set forth in
11Section 8 of this Act.
12    "Incremental income tax" means the total amount withheld
13during the taxable year from the compensation of River Edge
14Construction Jobs Employees.
15    "Agency" means: each officer, board, commission, and
16agency created by the Constitution, in the executive branch of
17State government, other than the State Board of Elections;
18each officer, department, board, commission, agency,
19institution, authority, university, and body politic and
20corporate of the State; each administrative unit or corporate
21outgrowth of the State government that is created by or
22pursuant to statute, other than units of local government and
23their officers, school districts, and boards of election
24commissioners; and each administrative unit or corporate
25outgrowth of the above and as may be created by executive order
26of the Governor. No entity is an "agency" for the purposes of

 

 

10200HB1497ham001- 119 -LRB102 03513 HLH 38716 a

1this Act unless the entity is authorized by law to make rules
2or regulations.
3    "River Edge construction jobs credit" means an amount
4equal to 50% of the incremental income tax attributable to
5River Edge construction employees employed on a River Edge
6construction jobs project. However, the amount may equal 75%
7of the incremental income tax attributable to River Edge
8construction employees employed on a River Edge construction
9jobs project located in an underserved area. The total
10aggregate amount of credits awarded under the Blue Collar Jobs
11Act (Article 20 of this amendatory Act of the 101st General
12Assembly) shall not exceed $20,000,000 in any State fiscal
13year.
14    "River Edge construction jobs employee" means a laborer or
15worker who is employed by an Illinois contractor or
16subcontractor in the actual construction work on the site of a
17River Edge construction jobs project.
18    "River Edge construction jobs project" means building a
19structure or building, or making improvements of any kind to
20real property, in a River Edge Redevelopment Zone that is
21built or improved in the course of completing a qualified
22rehabilitation plan. "River Edge construction jobs project"
23does not include the routine operation, routine repair, or
24routine maintenance of existing structures, buildings, or real
25property.
26    "Rule" means each agency statement of general

 

 

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1applicability that implements, applies, interprets, or
2prescribes law or policy, but does not include (i) statements
3concerning only the internal management of an agency and not
4affecting private rights or procedures available to persons or
5entities outside the agency, (ii) intra-agency memoranda, or
6(iii) the prescription of standardized forms.
7    "Underserved area" means a geographic area that meets one
8or more of the following conditions:
9        (1) the area has a poverty rate of at least 20%,
10    according to the latest American Community Survey federal
11    decennial census;
12        (2) 35% or more of the families with children in the
13    area are living below 130% of the poverty line, according
14    to the latest American Community Survey 75% or more of the
15    children in the area participate in the federal free lunch
16    program according to reported statistics from the State
17    Board of Education;
18        (3) at least 20% of the households in the area receive
19    assistance under the Supplemental Nutrition Assistance
20    Program (SNAP); or
21        (4) the area has an average unemployment rate, as
22    determined by the Illinois Department of Employment
23    Security, that is more than 120% of the national
24    unemployment average, as determined by the U.S. Department
25    of Labor, for a period of at least 2 consecutive calendar
26    years preceding the date of the application.

 

 

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1(Source: P.A. 101-9, eff. 6-5-19.)
 
2
ARTICLE 40. FILM PRODUCTION TAX CREDIT

 
3    Section 40-5. The Illinois Income Tax Act is amended by
4changing Section 213 as follows:
 
5    (35 ILCS 5/213)
6    Sec. 213. Film production services credit. For tax years
7beginning on or after January 1, 2004, a taxpayer who has been
8awarded a tax credit under the Film Production Services Tax
9Credit Act or under the Film Production Services Tax Credit
10Act of 2008 is entitled to a credit against the taxes imposed
11under subsections (a) and (b) of Section 201 of this Act in an
12amount determined by the Department of Commerce and Economic
13Opportunity under those Acts. If the taxpayer is a partnership
14or Subchapter S corporation, the credit is allowed to the
15partners or shareholders in accordance with the determination
16of income and distributive share of income under Sections 702
17and 704 and Subchapter S of the Internal Revenue Code.
18    A transfer of this credit may be made by the taxpayer
19earning the credit within one year after the credit is awarded
20in accordance with rules adopted by the Department of Commerce
21and Economic Opportunity. Beginning July 1, 2023, if a credit
22is transferred under this Section by the taxpayer, then the
23transferor taxpayer shall pay to the Department of Commerce

 

 

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1and Economic Opportunity, upon notification of a transfer,
22.5% of the transferred credit amount eligible for nonresident
3wages, as described in Section 10 of the Film Production
4Services Tax Credit Act of 2008, and an additional 0.25% of the
5total amount of the transferred credit that is not calculated
6on nonresident wages, which shall be deposited into the
7Illinois Production Workforce Development Fund.
8    The Department, in cooperation with the Department of
9Commerce and Economic Opportunity, must prescribe rules to
10enforce and administer the provisions of this Section. This
11Section is exempt from the provisions of Section 250 of this
12Act.
13    The credit may not be carried back. If the amount of the
14credit exceeds the tax liability for the year, the excess may
15be carried forward and applied to the tax liability of the 5
16taxable years following the excess credit year. The credit
17shall be applied to the earliest year for which there is a tax
18liability. If there are credits from more than one tax year
19that are available to offset a liability, the earlier credit
20shall be applied first. In no event shall a credit under this
21Section reduce the taxpayer's liability to less than zero.
22(Source: P.A. 94-171, eff. 7-11-05; 95-720, eff. 5-27-08.)
 
23    Section 40-10. The Film Production Services Tax Credit Act
24of 2008 is amended by changing Sections 10 and 42 and by adding
25Section 46 as follows:
 

 

 

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1    (35 ILCS 16/10)
2    Sec. 10. Definitions. As used in this Act:
3    "Accredited production" means: (i) for productions
4commencing before May 1, 2006, a film, video, or television
5production that has been certified by the Department in which
6the aggregate Illinois labor expenditures included in the cost
7of the production, in the period that ends 12 months after the
8time principal filming or taping of the production began,
9exceed $100,000 for productions of 30 minutes or longer, or
10$50,000 for productions of less than 30 minutes; and (ii) for
11productions commencing on or after May 1, 2006, a film, video,
12or television production that has been certified by the
13Department in which the Illinois production spending included
14in the cost of production in the period that ends 12 months
15after the time principal filming or taping of the production
16began exceeds $100,000 for productions of 30 minutes or longer
17or exceeds $50,000 for productions of less than 30 minutes.
18"Accredited production" does not include a production that:
19        (1) is news, current events, or public programming, or
20    a program that includes weather or market reports;
21        (2) is a talk show;
22        (3) is a production in respect of a game,
23    questionnaire, or contest;
24        (4) is a sports event or activity;
25        (5) is a gala presentation or awards show;

 

 

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1        (6) is a finished production that solicits funds;
2        (7) is a production produced by a film production
3    company if records, as required by 18 U.S.C. 2257, are to
4    be maintained by that film production company with respect
5    to any performer portrayed in that single media or
6    multimedia program; or
7        (8) is a production produced primarily for industrial,
8    corporate, or institutional purposes.
9    "Accredited animated production" means an accredited
10production in which movement and characters' performances are
11created using a frame-by-frame technique and a significant
12number of major characters are animated. Motion capture by
13itself is not an animation technique.
14    "Accredited production certificate" means a certificate
15issued by the Department certifying that the production is an
16accredited production that meets the guidelines of this Act.
17    "Applicant" means a taxpayer that is a film production
18company that is operating or has operated an accredited
19production located within the State of Illinois and that (i)
20owns the copyright in the accredited production throughout the
21Illinois production period or (ii) has contracted directly
22with the owner of the copyright in the accredited production
23or a person acting on behalf of the owner to provide services
24for the production, where the owner of the copyright is not an
25eligible production corporation.
26    "Credit" means:

 

 

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1        (1) for an accredited production approved by the
2    Department on or before January 1, 2005 and commencing
3    before May 1, 2006, the amount equal to 25% of the Illinois
4    labor expenditure approved by the Department. The
5    applicant is deemed to have paid, on its balance due day
6    for the year, an amount equal to 25% of its qualified
7    Illinois labor expenditure for the tax year. For Illinois
8    labor expenditures generated by the employment of
9    residents of geographic areas of high poverty or high
10    unemployment, as determined by the Department, in an
11    accredited production commencing before May 1, 2006 and
12    approved by the Department after January 1, 2005, the
13    applicant shall receive an enhanced credit of 10% in
14    addition to the 25% credit; and
15        (2) for an accredited production commencing on or
16    after May 1, 2006, the amount equal to:
17            (i) 20% of the Illinois production spending for
18        the taxable year; plus
19            (ii) 15% of the Illinois labor expenditures
20        generated by the employment of residents of geographic
21        areas of high poverty or high unemployment, as
22        determined by the Department; and
23        (3) for an accredited production commencing on or
24    after January 1, 2009, the amount equal to:
25            (i) 30% of the Illinois production spending for
26        the taxable year; plus

 

 

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1            (ii) 15% of the Illinois labor expenditures
2        generated by the employment of residents of geographic
3        areas of high poverty or high unemployment, as
4        determined by the Department.
5    "Department" means the Department of Commerce and Economic
6Opportunity.
7    "Director" means the Director of Commerce and Economic
8Opportunity.
9    "Illinois labor expenditure" means salary or wages paid to
10employees of the applicant for services on the accredited
11production.
12    To qualify as an Illinois labor expenditure, the
13expenditure must be:
14        (1) Reasonable in the circumstances.
15        (2) Included in the federal income tax basis of the
16    property.
17        (3) Incurred by the applicant for services on or after
18    January 1, 2004.
19        (4) Incurred for the production stages of the
20    accredited production, from the final script stage to the
21    end of the post-production stage.
22        (5) Limited to the first $25,000 of wages paid or
23    incurred to each employee of a production commencing
24    before May 1, 2006 and the first $100,000 of wages paid or
25    incurred to each employee of a production commencing on or
26    after May 1, 2006 and prior to July 1, 2022. For

 

 

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1    productions commencing on or after July 1, 2022, limited
2    to the first $200,000 of wages paid or incurred to each
3    nonresident or resident employee of a production company
4    or loan out company that provides in-State services to a
5    production, whether those wages are paid or incurred by
6    the production company, loan out company, or both, subject
7    to withholding payments provided for in Article 7 of the
8    Illinois Income Tax Act. For purposes of calculating
9    Illinois labor expenditures for a television series, the
10    nonresident wage limitations provided under this
11    subparagraph are applied to the entire season.
12        (6) For a production commencing before May 1, 2006,
13    exclusive of the salary or wages paid to or incurred for
14    the 2 highest paid employees of the production.
15        (7) Directly attributable to the accredited
16    production.
17        (8) (Blank).
18        (9) Prior to July 1, 2022, paid Paid to persons
19    resident in Illinois at the time the payments were made.
20    For a production commencing on or after July 1, 2022, paid
21    to persons resident in Illinois and nonresidents at the
22    time the payments were made. For purposes of this
23    subparagraph, only wages paid to nonresidents working in
24    the following positions shall be considered Illinois labor
25    expenditures: Writer, Director, Director of Photography,
26    Production Designer, Costume Designer, Production

 

 

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1    Accountant, VFX Supervisor, Editor, Composer, and Actor,
2    subject to the limitations set forth under this
3    subparagraph. For an accredited Illinois production
4    spending of $25,000,000 or less, no more than 2
5    nonresident actors' wages shall qualify as an Illinois
6    labor expenditure. For an accredited production with
7    Illinois production spending of more than $25,000,000, no
8    more than 4 nonresident actor's wages shall qualify as
9    Illinois labor expenditures. The Department may not award
10    more than $20,000,000 in credits under this Act based on
11    the labor expenditures for nonresident employees in any
12    State fiscal year.
13        (10) Paid for services rendered in Illinois.
14    "Illinois production spending" means the expenses incurred
15by the applicant for an accredited production, including,
16without limitation, all of the following:
17        (1) expenses to purchase, from vendors within
18    Illinois, tangible personal property that is used in the
19    accredited production;
20        (2) expenses to acquire services, from vendors in
21    Illinois, for film production, editing, or processing; and
22        (3) for a production commencing before July 1, 2022,
23    the compensation, not to exceed $100,000 for any one
24    employee, for contractual or salaried employees who are
25    Illinois residents performing services with respect to the
26    accredited production. For a production commencing on or

 

 

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1    after July 1, 2022, the compensation, not to exceed
2    $200,000 for any one employee, for contractual or salaried
3    employees who are Illinois residents or nonresident
4    employees, subject to the limitations set forth under
5    Section 10 of this Act.
6    "Loan out company" means a personal service corporation or
7other entity that is under contract with the taxpayer to
8provide specified individual personnel, such as artists, crew,
9actors, producers, or directors for the performance of
10services used directly in a production. "Loan out company"
11does not include entities contracted with by the taxpayer to
12provide goods or ancillary contractor services such as
13catering, construction, trailers, equipment, or
14transportation.
15    "Qualified production facility" means stage facilities in
16the State in which television shows and films are or are
17intended to be regularly produced and that contain at least
18one sound stage of at least 15,000 square feet.
19    Rulemaking authority to implement Public Act 95-1006, if
20any, is conditioned on the rules being adopted in accordance
21with all provisions of the Illinois Administrative Procedure
22Act and all rules and procedures of the Joint Committee on
23Administrative Rules; any purported rule not so adopted, for
24whatever reason, is unauthorized.
25(Source: P.A. 102-558, eff. 8-20-21.)
 

 

 

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1    (35 ILCS 16/42)
2    Sec. 42. Sunset of credits. The application of credits
3awarded pursuant to this Act shall be limited by a reasonable
4and appropriate sunset date. A taxpayer shall not be entitled
5to take a credit awarded pursuant to this Act for tax years
6beginning on or after January 1, 2027; provided that a
7taxpayer that has been awarded a credit pursuant to this Act
8for a tax year beginning prior to January 1, 2027 may continue
9to take a credit under this Act for the same accredited
10production for tax years beginning on or after January 1, 2027
11if the accredited production remains eligible for credits
12under this Act.
13(Source: P.A. 101-178, eff. 8-1-19.)
 
14    (35 ILCS 16/46 new)
15    Sec. 46. Illinois Production Workforce Development Fund.
16    (a) The Illinois Production Workforce Development Fund is
17created as a special fund in the State Treasury. Beginning
18July 1, 2022, amounts paid to the Department of Commerce and
19Economic Opportunity pursuant to Section 213 of the Illinois
20Income Tax Act shall be deposited into the Fund. The Fund shall
21be used exclusively to provide grants to community-based
22organizations, labor organizations, private and public
23universities, community colleges, and other organizations and
24institutions that may be deemed appropriate by the Department
25to administer workforce training programs that support efforts

 

 

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1to recruit, hire, promote, retain, develop, and train a
2diverse and inclusive workforce in the film industry.
3    (b) Pursuant to Section 213 of the Illinois Income Tax
4Act, the Fund shall receive deposits in amounts not to exceed
50.25% of the amount of each credit certificate issued that is
6not calculated on out-of-state wages and transferred or
7claimed on an Illinois tax return in the quarter such credit
8was transferred or claimed. In addition, such amount shall
9also include 2.5% of the credit amount calculated on wages
10paid to nonresidents that is transferred or claimed on an
11Illinois tax return in the quarter such credit was transferred
12or claimed.
13    (c) At the request of the Department, the State
14Comptroller and the State Treasurer may advance amounts to the
15Fund on an annual basis not to exceed $1,000,000 in any fiscal
16year. The fund from which the moneys are advanced shall be
17reimbursed in the same fiscal year for any such advance
18payments as described in this Section. The method of
19reimbursement shall be set forth in rules.
20    (d) Of the appropriated funds in a given fiscal year, 50%
21of the appropriated funds shall be reserved for organizations
22that meet one of the following criteria. The organization is:
23(1) a minority-owned business, as defined by the Business
24Enterprise for Minorities, Women, and Persons with
25Disabilities Act; (2) located in an underserved area, as
26defined by the Economic Development for a Growing Economy Tax

 

 

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1Credit Act; or (3) on an annual basis, training a cohort of
2program participants where at least 50% of the program
3participants are either a minority person, as defined by the
4Business Enterprise for Minorities, Women, and Persons with
5Disabilities Act, or reside in an underserved area, as defined
6by the Economic Development for a Growing Economy Tax Credit
7Act.
8    (e) The Illinois Production Workforce Development Fund
9shall be administered by the Department. The Department may
10adopt rules necessary to administer the provisions of this
11Section.
12    (f) Notwithstanding any other law to the contrary, the
13Illinois Production Workforce Development Fund is not subject
14to sweeps, administrative charge-backs, or any other fiscal or
15budgetary maneuver that would in any way transfer any amounts
16from the Illinois Production Workforce Development Fund.
17    (g) By June 30 of each fiscal year, the Department must
18submit to the General Assembly a report that includes the
19following information: (1) an identification of the
20organizations and institutions that received funding to
21administer workforce training programs during the fiscal year;
22(2) the number of total persons trained and the number of
23persons trained per workforce training program in the fiscal
24year; and (3) in the aggregate, per organization, the number
25of persons identified as a minority person or that reside in an
26underserved area that received training in the fiscal year.
 

 

 

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1    Section 40-90. The State Finance Act is amended by adding
2Section 5.970 as follows:
 
3    (30 ILCS 105/5.970 new)
4    Sec. 5.970. The Illinois Production Workforce Development
5Fund.
 
6
ARTICLE 45. PROPERTY TAX REBATE

 
7    Section 45-5. The Illinois Administrative Procedure Act is
8amended by adding Section 5-45.21 as follows:
 
9    (5 ILCS 100/5-45.21 new)
10    Sec. 5-45.21. Emergency rulemaking; residential real
11estate tax rebate. To provide for the expeditious and timely
12implementation of Section 208.5 of the Illinois Income Tax
13Act, emergency rules implementing the residential real estate
14tax rebate described in that Section may be adopted in
15accordance with Section 5-45 by the Department of Revenue. The
16adoption of emergency rules authorized by Section 5-45 and
17this Section is deemed to be necessary for the public
18interest, safety, and welfare.
19    This Section is repealed one year after the effective date
20of this amendatory Act of the 102nd General Assembly.
 

 

 

10200HB1497ham001- 134 -LRB102 03513 HLH 38716 a

1    Section 45-10. The State Finance Act is amended by adding
2Section 5.971 as follows:
 
3    (30 ILCS 105/5.971 new)
4    Sec. 5.971. The Property Tax Rebate Fund. This Section is
5repealed on January 1, 2024.
 
6    Section 45-15. The Illinois Income Tax Act is amended by
7adding Section 208.5 as follows:
 
8    (35 ILCS 5/208.5 new)
9    Sec. 208.5. Residential real estate tax rebate.
10    (a) The Department shall pay a one-time rebate to every
11individual taxpayer who files with the Department, on or
12before October 17, 2022, an Illinois income tax return for tax
13year 2021 and who qualifies, in that tax year, under rules
14adopted by the Department, for the income tax credit provided
15under Section 208 of this Act. The amount of the one-time
16rebate provided under this Section shall be the lesser of: (1)
17the amount of the credit allowed to the taxpayer under Section
18208 for tax year 2021, including any amounts that would
19otherwise reduce a taxpayer's liability to less than zero, or
20(2) $300 per principal residence. The Department shall develop
21a process to claim a rebate for taxpayers who otherwise would
22be eligible for the rebate under this Section but who did not
23have an obligation to file a 2021 Illinois income tax return

 

 

10200HB1497ham001- 135 -LRB102 03513 HLH 38716 a

1because their exemption allowance exceeded their Illinois base
2income.
3    (b) On the effective date of this amendatory Act of the
4102nd General Assembly, or as soon thereafter as practical,
5but no later than June 30, 2022, the State Comptroller shall
6direct and the State Treasurer shall transfer the sum of
7$470,000,000 from the General Revenue Fund to the Property Tax
8Rebate Fund.
9    (c) On July 1, 2022, or as soon thereafter as practical,
10the State Comptroller shall direct and the State Treasurer
11shall transfer the sum of $50,000,000 from the General Revenue
12Fund to the Property Tax Rebate Fund.
13    (d) In addition to any other transfers that may be
14provided for by law, beginning on the effective date of this
15amendatory Act of the 102nd General Assembly and until June
1630, 2023, the Director may certify additional transfer amounts
17needed beyond the amounts specified in subsections (b) and
18(c). The State Comptroller shall direct and the State
19Treasurer shall transfer the amounts certified by the Director
20from the General Revenue Fund to the Property Tax Rebate Fund.
21    (e) The Property Tax Rebate Fund is hereby created as a
22special fund in the State Treasury. The one-time rebate
23payments provided under this Section shall be paid from the
24Property Tax Rebate Fund. This subsection shall constitute an
25irrevocable and continuing appropriation of all amounts
26necessary to provide the one-time rebate payments described in

 

 

10200HB1497ham001- 136 -LRB102 03513 HLH 38716 a

1this Section.
2    (f) Beginning on July 5, 2022, the Department shall
3certify to the Comptroller the names of the taxpayers who are
4eligible for a one-time rebate under this Section, the amounts
5of those rebates, and any other information that the
6Comptroller requires to direct the payment of the rebates
7provided under this Section to taxpayers.
8    (g) Notwithstanding any other law to the contrary, the
9one-time rebates provided under this Section shall not be
10subject to offset by the Comptroller against any liability
11owed either to the State or to any unit of local government.
12    (h) On July 1, 2023, or as soon thereafter as practical,
13the State Comptroller shall direct and the State Treasurer
14shall transfer the remaining balance in the Property Tax
15Rebate Fund to the General Revenue Fund. Upon completion of
16the transfer, the Property Tax Rebate Fund is dissolved.
17    (i) This Section is repealed on January 1, 2024.
 
18
ARTICLE 50. GROCERIES

 
19    Section 50-5. The State Finance Act is amended by adding
20Section 5.972 as follows:
 
21    (30 ILCS 105/5.972 new)
22    Sec. 5.972. The Grocery Tax Replacement Fund. This Section
23is repealed January 1, 2024.
 

 

 

10200HB1497ham001- 137 -LRB102 03513 HLH 38716 a

1    Section 50-10. The State Finance Act is amended by
2changing Sections 6z-17 and 6z-18 and by adding Section 6z-130
3as follows:
 
4    (30 ILCS 105/6z-17)  (from Ch. 127, par. 142z-17)
5    Sec. 6z-17. State and Local Sales Tax Reform Fund.
6    (a) After deducting the amount transferred to the Tax
7Compliance and Administration Fund under subsection (b), of
8the money paid into the State and Local Sales Tax Reform Fund:
9(i) subject to appropriation to the Department of Revenue,
10Municipalities having 1,000,000 or more inhabitants shall
11receive 20% and may expend such amount to fund and establish a
12program for developing and coordinating public and private
13resources targeted to meet the affordable housing needs of
14low-income and very low-income households within such
15municipality, (ii) 10% shall be transferred into the Regional
16Transportation Authority Occupation and Use Tax Replacement
17Fund, a special fund in the State treasury which is hereby
18created, (iii) until July 1, 2013, subject to appropriation to
19the Department of Transportation, the Madison County Mass
20Transit District shall receive .6%, and beginning on July 1,
212013, subject to appropriation to the Department of Revenue,
220.6% shall be distributed each month out of the Fund to the
23Madison County Mass Transit District, (iv) the following
24amounts, plus any cumulative deficiency in such transfers for

 

 

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1prior months, shall be transferred monthly into the Build
2Illinois Fund and credited to the Build Illinois Bond Account
3therein:
4Fiscal YearAmount
51990$2,700,000
619911,850,000
719922,750,000
819932,950,000
9    From Fiscal Year 1994 through Fiscal Year 2025 the
10transfer shall total $3,150,000 monthly, plus any cumulative
11deficiency in such transfers for prior months, and (v) the
12remainder of the money paid into the State and Local Sales Tax
13Reform Fund shall be transferred into the Local Government
14Distributive Fund and, except for municipalities with
151,000,000 or more inhabitants which shall receive no portion
16of such remainder, shall be distributed, subject to
17appropriation, in the manner provided by Section 2 of "An Act
18in relation to State revenue sharing with local government
19entities", approved July 31, 1969, as now or hereafter
20amended. Municipalities with more than 50,000 inhabitants
21according to the 1980 U.S. Census and located within the Metro
22East Mass Transit District receiving funds pursuant to
23provision (v) of this paragraph may expend such amounts to
24fund and establish a program for developing and coordinating
25public and private resources targeted to meet the affordable
26housing needs of low-income and very low-income households

 

 

10200HB1497ham001- 139 -LRB102 03513 HLH 38716 a

1within such municipality.
2    Moneys transferred from the Grocery Tax Replacement Fund
3to the State and Local Sales Tax Reform Fund under Section
46z-130 shall be treated under this Section in the same manner
5as if they had been remitted with the return on which they were
6reported.
7    (b) Beginning on the first day of the first calendar month
8to occur on or after the effective date of this amendatory Act
9of the 98th General Assembly, each month the Department of
10Revenue shall certify to the State Comptroller and the State
11Treasurer, and the State Comptroller shall order transferred
12and the State Treasurer shall transfer from the State and
13Local Sales Tax Reform Fund to the Tax Compliance and
14Administration Fund, an amount equal to 1/12 of 5% of 20% of
15the cash receipts collected during the preceding fiscal year
16by the Audit Bureau of the Department of Revenue under the Use
17Tax Act, the Service Use Tax Act, the Service Occupation Tax
18Act, the Retailers' Occupation Tax Act, and associated local
19occupation and use taxes administered by the Department. The
20amount distributed under subsection (a) each month shall first
21be reduced by the amount transferred to the Tax Compliance and
22Administration Fund under this subsection (b). Moneys
23transferred to the Tax Compliance and Administration Fund
24under this subsection (b) shall be used, subject to
25appropriation, to fund additional auditors and compliance
26personnel at the Department of Revenue.

 

 

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1(Source: P.A. 98-44, eff. 6-28-13; 98-1098, eff. 8-26-14.)
 
2    (30 ILCS 105/6z-18)  (from Ch. 127, par. 142z-18)
3    Sec. 6z-18. Local Government Tax Fund. A portion of the
4money paid into the Local Government Tax Fund from sales of
5tangible personal property taxed at the 1% rate under the
6Retailers' Occupation Tax Act and the Service Occupation Tax
7Act, which occurred in municipalities, shall be distributed to
8each municipality based upon the sales which occurred in that
9municipality. The remainder shall be distributed to each
10county based upon the sales which occurred in the
11unincorporated area of that county.
12    Moneys transferred from the Grocery Tax Replacement Fund
13to the Local Government Tax Fund under Section 6z-130 shall be
14treated under this Section in the same manner as if they had
15been remitted with the return on which they were reported.
16    A portion of the money paid into the Local Government Tax
17Fund from the 6.25% general use tax rate on the selling price
18of tangible personal property which is purchased outside
19Illinois at retail from a retailer and which is titled or
20registered by any agency of this State's government shall be
21distributed to municipalities as provided in this paragraph.
22Each municipality shall receive the amount attributable to
23sales for which Illinois addresses for titling or registration
24purposes are given as being in such municipality. The
25remainder of the money paid into the Local Government Tax Fund

 

 

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1from such sales shall be distributed to counties. Each county
2shall receive the amount attributable to sales for which
3Illinois addresses for titling or registration purposes are
4given as being located in the unincorporated area of such
5county.
6    A portion of the money paid into the Local Government Tax
7Fund from the 6.25% general rate (and, beginning July 1, 2000
8and through December 31, 2000, the 1.25% rate on motor fuel and
9gasohol, and beginning on August 6, 2010 through August 15,
102010, the 1.25% rate on sales tax holiday items) on sales
11subject to taxation under the Retailers' Occupation Tax Act
12and the Service Occupation Tax Act, which occurred in
13municipalities, shall be distributed to each municipality,
14based upon the sales which occurred in that municipality. The
15remainder shall be distributed to each county, based upon the
16sales which occurred in the unincorporated area of such
17county.
18    For the purpose of determining allocation to the local
19government unit, a retail sale by a producer of coal or other
20mineral mined in Illinois is a sale at retail at the place
21where the coal or other mineral mined in Illinois is extracted
22from the earth. This paragraph does not apply to coal or other
23mineral when it is delivered or shipped by the seller to the
24purchaser at a point outside Illinois so that the sale is
25exempt under the United States Constitution as a sale in
26interstate or foreign commerce.

 

 

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1    Whenever the Department determines that a refund of money
2paid into the Local Government Tax Fund should be made to a
3claimant instead of issuing a credit memorandum, the
4Department shall notify the State Comptroller, who shall cause
5the order to be drawn for the amount specified, and to the
6person named, in such notification from the Department. Such
7refund shall be paid by the State Treasurer out of the Local
8Government Tax Fund.
9    As soon as possible after the first day of each month,
10beginning January 1, 2011, upon certification of the
11Department of Revenue, the Comptroller shall order
12transferred, and the Treasurer shall transfer, to the STAR
13Bonds Revenue Fund the local sales tax increment, as defined
14in the Innovation Development and Economy Act, collected
15during the second preceding calendar month for sales within a
16STAR bond district and deposited into the Local Government Tax
17Fund, less 3% of that amount, which shall be transferred into
18the Tax Compliance and Administration Fund and shall be used
19by the Department, subject to appropriation, to cover the
20costs of the Department in administering the Innovation
21Development and Economy Act.
22    After the monthly transfer to the STAR Bonds Revenue Fund,
23on or before the 25th day of each calendar month, the
24Department shall prepare and certify to the Comptroller the
25disbursement of stated sums of money to named municipalities
26and counties, the municipalities and counties to be those

 

 

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1entitled to distribution of taxes or penalties paid to the
2Department during the second preceding calendar month. The
3amount to be paid to each municipality or county shall be the
4amount (not including credit memoranda) collected during the
5second preceding calendar month by the Department and paid
6into the Local Government Tax Fund, plus an amount the
7Department determines is necessary to offset any amounts which
8were erroneously paid to a different taxing body, and not
9including an amount equal to the amount of refunds made during
10the second preceding calendar month by the Department, and not
11including any amount which the Department determines is
12necessary to offset any amounts which are payable to a
13different taxing body but were erroneously paid to the
14municipality or county, and not including any amounts that are
15transferred to the STAR Bonds Revenue Fund. Within 10 days
16after receipt, by the Comptroller, of the disbursement
17certification to the municipalities and counties, provided for
18in this Section to be given to the Comptroller by the
19Department, the Comptroller shall cause the orders to be drawn
20for the respective amounts in accordance with the directions
21contained in such certification.
22    When certifying the amount of monthly disbursement to a
23municipality or county under this Section, the Department
24shall increase or decrease that amount by an amount necessary
25to offset any misallocation of previous disbursements. The
26offset amount shall be the amount erroneously disbursed within

 

 

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1the 6 months preceding the time a misallocation is discovered.
2    The provisions directing the distributions from the
3special fund in the State Treasury provided for in this
4Section shall constitute an irrevocable and continuing
5appropriation of all amounts as provided herein. The State
6Treasurer and State Comptroller are hereby authorized to make
7distributions as provided in this Section.
8    In construing any development, redevelopment, annexation,
9preannexation or other lawful agreement in effect prior to
10September 1, 1990, which describes or refers to receipts from
11a county or municipal retailers' occupation tax, use tax or
12service occupation tax which now cannot be imposed, such
13description or reference shall be deemed to include the
14replacement revenue for such abolished taxes, distributed from
15the Local Government Tax Fund.
16    As soon as possible after the effective date of this
17amendatory Act of the 98th General Assembly, the State
18Comptroller shall order and the State Treasurer shall transfer
19$6,600,000 from the Local Government Tax Fund to the Illinois
20State Medical Disciplinary Fund.
21(Source: P.A. 100-1171, eff. 1-4-19.)
 
22    (30 ILCS 105/6z-130 new)
23    Sec. 6z-130. Grocery Tax Replacement Fund.
24    (a) The Grocery Tax Replacement Fund is hereby created as
25a special fund in the State Treasury.

 

 

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1    (b) On the effective date of this amendatory Act of the
2102nd General Assembly, or as soon thereafter as practical,
3but no later than June 30, 2022, the State Comptroller shall
4direct and the State Treasurer shall transfer the sum of
5$225,000,000 from the General Revenue Fund to the Grocery Tax
6Replacement Fund.
7    (c) On July 1, 2022, or as soon thereafter as practical,
8the State Comptroller shall direct and the State Treasurer
9shall transfer the sum of $175,000,000 from the General
10Revenue Fund to the Grocery Tax Replacement Fund.
11    (d) In addition to any other transfers that may be
12provided for by law, beginning on the effective date of this
13amendatory Act of the 102nd General Assembly and until
14November 30, 2023, the Director may certify additional
15transfer amounts needed beyond the amounts specified in
16subsections (b) and (c) to cover any additional amounts needed
17to equal the net revenue that, but for the reduction of the
18rate to 0% in the Use Tax Act, the Service Use Tax Act, the
19Service Occupation Tax Act, and the Retailers' Occupation Tax
20Act under this amendatory Act of the 102nd General Assembly,
21would have been realized if the items that are subject to the
22rate reduction had been taxed at the 1% rate during the period
23of the reduction. The State Comptroller shall direct and the
24State Treasurer shall transfer the amounts certified by the
25Director from the General Revenue Fund to the Grocery Tax
26Replacement Fund.

 

 

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1    (e) In addition to any other transfers that may be
2provided for by law, beginning on July 1, 2022 and until
3December 1, 2023, at the direction of the Department of
4Revenue, the State Comptroller shall direct and the State
5Treasurer shall transfer from the Grocery Tax Replacement Fund
6to the State and Local Sales Tax Reform Fund any amounts needed
7to equal the net revenue that, but for the reduction of the
8rate to 0% in the Use Tax Act and Service Use Tax Act under
9this amendatory Act of the 102nd General Assembly, would have
10been deposited into the State and Local Sales Tax Reform Fund
11if the items that are subject to the rate reduction had been
12taxed at the 1% rate during the period of the reduction.
13    (f) In addition to any other transfers that may be
14provided for by law, beginning on July 1, 2022 and until
15December 1, 2023, at the direction of the Department of
16Revenue, the State Comptroller shall direct and the State
17Treasurer shall transfer from the Grocery Tax Replacement Fund
18to the Local Government Tax Fund any amounts needed to equal
19the net revenue that, but for the reduction of the rate to 0%
20in the Service Occupation Tax Act and the Retailers'
21Occupation Tax Act under this amendatory Act of the 102nd
22General Assembly, would have been deposited into the Local
23Government Tax Fund if the items that are subject to the rate
24reduction had been taxed at the 1% rate during the period of
25the reduction.
26    (g) The State Comptroller shall direct and the State

 

 

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1Treasurer shall transfer the remaining balance in the Grocery
2Tax Replacement Fund to the General Revenue Fund on December
31, 2023, or as soon thereafter as practical. Upon completion
4of the transfer, the Grocery Tax Replacement Fund is
5dissolved.
6    (h) This Section is repealed on January 1, 2024.
 
7    Section 50-15. The Use Tax Act is amended by changing
8Sections 3-10 and 9 as follows:
 
9    (35 ILCS 105/3-10)
10    Sec. 3-10. Rate of tax. Unless otherwise provided in this
11Section, the tax imposed by this Act is at the rate of 6.25% of
12either the selling price or the fair market value, if any, of
13the tangible personal property. In all cases where property
14functionally used or consumed is the same as the property that
15was purchased at retail, then the tax is imposed on the selling
16price of the property. In all cases where property
17functionally used or consumed is a by-product or waste product
18that has been refined, manufactured, or produced from property
19purchased at retail, then the tax is imposed on the lower of
20the fair market value, if any, of the specific property so used
21in this State or on the selling price of the property purchased
22at retail. For purposes of this Section "fair market value"
23means the price at which property would change hands between a
24willing buyer and a willing seller, neither being under any

 

 

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1compulsion to buy or sell and both having reasonable knowledge
2of the relevant facts. The fair market value shall be
3established by Illinois sales by the taxpayer of the same
4property as that functionally used or consumed, or if there
5are no such sales by the taxpayer, then comparable sales or
6purchases of property of like kind and character in Illinois.
7    Beginning on July 1, 2000 and through December 31, 2000,
8with respect to motor fuel, as defined in Section 1.1 of the
9Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
10the Use Tax Act, the tax is imposed at the rate of 1.25%.
11    Beginning on August 6, 2010 through August 15, 2010, with
12respect to sales tax holiday items as defined in Section 3-6 of
13this Act, the tax is imposed at the rate of 1.25%.
14    With respect to gasohol, the tax imposed by this Act
15applies to (i) 70% of the proceeds of sales made on or after
16January 1, 1990, and before July 1, 2003, (ii) 80% of the
17proceeds of sales made on or after July 1, 2003 and on or
18before July 1, 2017, and (iii) 100% of the proceeds of sales
19made thereafter. If, at any time, however, the tax under this
20Act on sales of gasohol is imposed at the rate of 1.25%, then
21the tax imposed by this Act applies to 100% of the proceeds of
22sales of gasohol made during that time.
23    With respect to majority blended ethanol fuel, the tax
24imposed by this Act does not apply to the proceeds of sales
25made on or after July 1, 2003 and on or before December 31,
262023 but applies to 100% of the proceeds of sales made

 

 

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1thereafter.
2    With respect to biodiesel blends with no less than 1% and
3no more than 10% biodiesel, the tax imposed by this Act applies
4to (i) 80% of the proceeds of sales made on or after July 1,
52003 and on or before December 31, 2018 and (ii) 100% of the
6proceeds of sales made thereafter. If, at any time, however,
7the tax under this Act on sales of biodiesel blends with no
8less than 1% and no more than 10% biodiesel is imposed at the
9rate of 1.25%, then the tax imposed by this Act applies to 100%
10of the proceeds of sales of biodiesel blends with no less than
111% and no more than 10% biodiesel made during that time.
12    With respect to 100% biodiesel and biodiesel blends with
13more than 10% but no more than 99% biodiesel, the tax imposed
14by this Act does not apply to the proceeds of sales made on or
15after July 1, 2003 and on or before December 31, 2023 but
16applies to 100% of the proceeds of sales made thereafter.
17    Until July 1, 2022 and beginning again on July 1, 2023,
18with With respect to food for human consumption that is to be
19consumed off the premises where it is sold (other than
20alcoholic beverages, food consisting of or infused with adult
21use cannabis, soft drinks, and food that has been prepared for
22immediate consumption), the tax is imposed at the rate of 1%.
23Beginning on July 1, 2022 and until July 1, 2023, with respect
24to food for human consumption that is to be consumed off the
25premises where it is sold (other than alcoholic beverages,
26food consisting of or infused with adult use cannabis, soft

 

 

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1drinks, and food that has been prepared for immediate
2consumption), the tax is imposed at the rate of 0%.
3    With respect to and prescription and nonprescription
4medicines, drugs, medical appliances, products classified as
5Class III medical devices by the United States Food and Drug
6Administration that are used for cancer treatment pursuant to
7a prescription, as well as any accessories and components
8related to those devices, modifications to a motor vehicle for
9the purpose of rendering it usable by a person with a
10disability, and insulin, blood sugar testing materials,
11syringes, and needles used by human diabetics, the tax is
12imposed at the rate of 1%. For the purposes of this Section,
13until September 1, 2009: the term "soft drinks" means any
14complete, finished, ready-to-use, non-alcoholic drink, whether
15carbonated or not, including but not limited to soda water,
16cola, fruit juice, vegetable juice, carbonated water, and all
17other preparations commonly known as soft drinks of whatever
18kind or description that are contained in any closed or sealed
19bottle, can, carton, or container, regardless of size; but
20"soft drinks" does not include coffee, tea, non-carbonated
21water, infant formula, milk or milk products as defined in the
22Grade A Pasteurized Milk and Milk Products Act, or drinks
23containing 50% or more natural fruit or vegetable juice.
24    Notwithstanding any other provisions of this Act,
25beginning September 1, 2009, "soft drinks" means non-alcoholic
26beverages that contain natural or artificial sweeteners. "Soft

 

 

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1drinks" do not include beverages that contain milk or milk
2products, soy, rice or similar milk substitutes, or greater
3than 50% of vegetable or fruit juice by volume.
4    Until August 1, 2009, and notwithstanding any other
5provisions of this Act, "food for human consumption that is to
6be consumed off the premises where it is sold" includes all
7food sold through a vending machine, except soft drinks and
8food products that are dispensed hot from a vending machine,
9regardless of the location of the vending machine. Beginning
10August 1, 2009, and notwithstanding any other provisions of
11this Act, "food for human consumption that is to be consumed
12off the premises where it is sold" includes all food sold
13through a vending machine, except soft drinks, candy, and food
14products that are dispensed hot from a vending machine,
15regardless of the location of the vending machine.
16    Notwithstanding any other provisions of this Act,
17beginning September 1, 2009, "food for human consumption that
18is to be consumed off the premises where it is sold" does not
19include candy. For purposes of this Section, "candy" means a
20preparation of sugar, honey, or other natural or artificial
21sweeteners in combination with chocolate, fruits, nuts or
22other ingredients or flavorings in the form of bars, drops, or
23pieces. "Candy" does not include any preparation that contains
24flour or requires refrigeration.
25    Notwithstanding any other provisions of this Act,
26beginning September 1, 2009, "nonprescription medicines and

 

 

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1drugs" does not include grooming and hygiene products. For
2purposes of this Section, "grooming and hygiene products"
3includes, but is not limited to, soaps and cleaning solutions,
4shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
5lotions and screens, unless those products are available by
6prescription only, regardless of whether the products meet the
7definition of "over-the-counter-drugs". For the purposes of
8this paragraph, "over-the-counter-drug" means a drug for human
9use that contains a label that identifies the product as a drug
10as required by 21 C.F.R. 201.66. The "over-the-counter-drug"
11label includes:
12        (A) A "Drug Facts" panel; or
13        (B) A statement of the "active ingredient(s)" with a
14    list of those ingredients contained in the compound,
15    substance or preparation.
16    Beginning on the effective date of this amendatory Act of
17the 98th General Assembly, "prescription and nonprescription
18medicines and drugs" includes medical cannabis purchased from
19a registered dispensing organization under the Compassionate
20Use of Medical Cannabis Program Act.
21    As used in this Section, "adult use cannabis" means
22cannabis subject to tax under the Cannabis Cultivation
23Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
24and does not include cannabis subject to tax under the
25Compassionate Use of Medical Cannabis Program Act.
26    If the property that is purchased at retail from a

 

 

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1retailer is acquired outside Illinois and used outside
2Illinois before being brought to Illinois for use here and is
3taxable under this Act, the "selling price" on which the tax is
4computed shall be reduced by an amount that represents a
5reasonable allowance for depreciation for the period of prior
6out-of-state use.
7(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
8102-4, eff. 4-27-21.)
 
9    (35 ILCS 105/9)  (from Ch. 120, par. 439.9)
10    Sec. 9. Except as to motor vehicles, watercraft, aircraft,
11and trailers that are required to be registered with an agency
12of this State, each retailer required or authorized to collect
13the tax imposed by this Act shall pay to the Department the
14amount of such tax (except as otherwise provided) at the time
15when he is required to file his return for the period during
16which such tax was collected, less a discount of 2.1% prior to
17January 1, 1990, and 1.75% on and after January 1, 1990, or $5
18per calendar year, whichever is greater, which is allowed to
19reimburse the retailer for expenses incurred in collecting the
20tax, keeping records, preparing and filing returns, remitting
21the tax and supplying data to the Department on request. The
22discount under this Section is not allowed for the 1.25%
23portion of taxes paid on aviation fuel that is subject to the
24revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.
2547133. When determining the discount allowed under this

 

 

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1Section, retailers shall include the amount of tax that would
2have been due at the 1% rate but for the 0% rate imposed under
3this amendatory Act of the 102nd General Assembly. In the case
4of retailers who report and pay the tax on a transaction by
5transaction basis, as provided in this Section, such discount
6shall be taken with each such tax remittance instead of when
7such retailer files his periodic return. The discount allowed
8under this Section is allowed only for returns that are filed
9in the manner required by this Act. The Department may
10disallow the discount for retailers whose certificate of
11registration is revoked at the time the return is filed, but
12only if the Department's decision to revoke the certificate of
13registration has become final. A retailer need not remit that
14part of any tax collected by him to the extent that he is
15required to remit and does remit the tax imposed by the
16Retailers' Occupation Tax Act, with respect to the sale of the
17same property.
18    Where such tangible personal property is sold under a
19conditional sales contract, or under any other form of sale
20wherein the payment of the principal sum, or a part thereof, is
21extended beyond the close of the period for which the return is
22filed, the retailer, in collecting the tax (except as to motor
23vehicles, watercraft, aircraft, and trailers that are required
24to be registered with an agency of this State), may collect for
25each tax return period, only the tax applicable to that part of
26the selling price actually received during such tax return

 

 

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1period.
2    Except as provided in this Section, on or before the
3twentieth day of each calendar month, such retailer shall file
4a return for the preceding calendar month. Such return shall
5be filed on forms prescribed by the Department and shall
6furnish such information as the Department may reasonably
7require. The return shall include the gross receipts on food
8for human consumption that is to be consumed off the premises
9where it is sold (other than alcoholic beverages, food
10consisting of or infused with adult use cannabis, soft drinks,
11and food that has been prepared for immediate consumption)
12which were received during the preceding calendar month,
13quarter, or year, as appropriate, and upon which tax would
14have been due but for the 0% rate imposed under this amendatory
15Act of the 102nd General Assembly. The return shall also
16include the amount of tax that would have been due on food for
17human consumption that is to be consumed off the premises
18where it is sold (other than alcoholic beverages, food
19consisting of or infused with adult use cannabis, soft drinks,
20and food that has been prepared for immediate consumption) but
21for the 0% rate imposed under this amendatory Act of the 102nd
22General Assembly.
23    On and after January 1, 2018, except for returns for motor
24vehicles, watercraft, aircraft, and trailers that are required
25to be registered with an agency of this State, with respect to
26retailers whose annual gross receipts average $20,000 or more,

 

 

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1all returns required to be filed pursuant to this Act shall be
2filed electronically. Retailers who demonstrate that they do
3not have access to the Internet or demonstrate hardship in
4filing electronically may petition the Department to waive the
5electronic filing requirement.
6    The Department may require returns to be filed on a
7quarterly basis. If so required, a return for each calendar
8quarter shall be filed on or before the twentieth day of the
9calendar month following the end of such calendar quarter. The
10taxpayer shall also file a return with the Department for each
11of the first two months of each calendar quarter, on or before
12the twentieth day of the following calendar month, stating:
13        1. The name of the seller;
14        2. The address of the principal place of business from
15    which he engages in the business of selling tangible
16    personal property at retail in this State;
17        3. The total amount of taxable receipts received by
18    him during the preceding calendar month from sales of
19    tangible personal property by him during such preceding
20    calendar month, including receipts from charge and time
21    sales, but less all deductions allowed by law;
22        4. The amount of credit provided in Section 2d of this
23    Act;
24        5. The amount of tax due;
25        5-5. The signature of the taxpayer; and
26        6. Such other reasonable information as the Department

 

 

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1    may require.
2    Each retailer required or authorized to collect the tax
3imposed by this Act on aviation fuel sold at retail in this
4State during the preceding calendar month shall, instead of
5reporting and paying tax on aviation fuel as otherwise
6required by this Section, report and pay such tax on a separate
7aviation fuel tax return. The requirements related to the
8return shall be as otherwise provided in this Section.
9Notwithstanding any other provisions of this Act to the
10contrary, retailers collecting tax on aviation fuel shall file
11all aviation fuel tax returns and shall make all aviation fuel
12tax payments by electronic means in the manner and form
13required by the Department. For purposes of this Section,
14"aviation fuel" means jet fuel and aviation gasoline.
15    If a taxpayer fails to sign a return within 30 days after
16the proper notice and demand for signature by the Department,
17the return shall be considered valid and any amount shown to be
18due on the return shall be deemed assessed.
19    Notwithstanding any other provision of this Act to the
20contrary, retailers subject to tax on cannabis shall file all
21cannabis tax returns and shall make all cannabis tax payments
22by electronic means in the manner and form required by the
23Department.
24    Beginning October 1, 1993, a taxpayer who has an average
25monthly tax liability of $150,000 or more shall make all
26payments required by rules of the Department by electronic

 

 

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1funds transfer. Beginning October 1, 1994, a taxpayer who has
2an average monthly tax liability of $100,000 or more shall
3make all payments required by rules of the Department by
4electronic funds transfer. Beginning October 1, 1995, a
5taxpayer who has an average monthly tax liability of $50,000
6or more shall make all payments required by rules of the
7Department by electronic funds transfer. Beginning October 1,
82000, a taxpayer who has an annual tax liability of $200,000 or
9more shall make all payments required by rules of the
10Department by electronic funds transfer. The term "annual tax
11liability" shall be the sum of the taxpayer's liabilities
12under this Act, and under all other State and local occupation
13and use tax laws administered by the Department, for the
14immediately preceding calendar year. The term "average monthly
15tax liability" means the sum of the taxpayer's liabilities
16under this Act, and under all other State and local occupation
17and use tax laws administered by the Department, for the
18immediately preceding calendar year divided by 12. Beginning
19on October 1, 2002, a taxpayer who has a tax liability in the
20amount set forth in subsection (b) of Section 2505-210 of the
21Department of Revenue Law shall make all payments required by
22rules of the Department by electronic funds transfer.
23    Before August 1 of each year beginning in 1993, the
24Department shall notify all taxpayers required to make
25payments by electronic funds transfer. All taxpayers required
26to make payments by electronic funds transfer shall make those

 

 

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1payments for a minimum of one year beginning on October 1.
2    Any taxpayer not required to make payments by electronic
3funds transfer may make payments by electronic funds transfer
4with the permission of the Department.
5    All taxpayers required to make payment by electronic funds
6transfer and any taxpayers authorized to voluntarily make
7payments by electronic funds transfer shall make those
8payments in the manner authorized by the Department.
9    The Department shall adopt such rules as are necessary to
10effectuate a program of electronic funds transfer and the
11requirements of this Section.
12    Before October 1, 2000, if the taxpayer's average monthly
13tax liability to the Department under this Act, the Retailers'
14Occupation Tax Act, the Service Occupation Tax Act, the
15Service Use Tax Act was $10,000 or more during the preceding 4
16complete calendar quarters, he shall file a return with the
17Department each month by the 20th day of the month next
18following the month during which such tax liability is
19incurred and shall make payments to the Department on or
20before the 7th, 15th, 22nd and last day of the month during
21which such liability is incurred. On and after October 1,
222000, if the taxpayer's average monthly tax liability to the
23Department under this Act, the Retailers' Occupation Tax Act,
24the Service Occupation Tax Act, and the Service Use Tax Act was
25$20,000 or more during the preceding 4 complete calendar
26quarters, he shall file a return with the Department each

 

 

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1month by the 20th day of the month next following the month
2during which such tax liability is incurred and shall make
3payment to the Department on or before the 7th, 15th, 22nd and
4last day of the month during which such liability is incurred.
5If the month during which such tax liability is incurred began
6prior to January 1, 1985, each payment shall be in an amount
7equal to 1/4 of the taxpayer's actual liability for the month
8or an amount set by the Department not to exceed 1/4 of the
9average monthly liability of the taxpayer to the Department
10for the preceding 4 complete calendar quarters (excluding the
11month of highest liability and the month of lowest liability
12in such 4 quarter period). If the month during which such tax
13liability is incurred begins on or after January 1, 1985, and
14prior to January 1, 1987, each payment shall be in an amount
15equal to 22.5% of the taxpayer's actual liability for the
16month or 27.5% of the taxpayer's liability for the same
17calendar month of the preceding year. If the month during
18which such tax liability is incurred begins on or after
19January 1, 1987, and prior to January 1, 1988, each payment
20shall be in an amount equal to 22.5% of the taxpayer's actual
21liability for the month or 26.25% of the taxpayer's liability
22for the same calendar month of the preceding year. If the month
23during which such tax liability is incurred begins on or after
24January 1, 1988, and prior to January 1, 1989, or begins on or
25after January 1, 1996, each payment shall be in an amount equal
26to 22.5% of the taxpayer's actual liability for the month or

 

 

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125% of the taxpayer's liability for the same calendar month of
2the preceding year. If the month during which such tax
3liability is incurred begins on or after January 1, 1989, and
4prior to January 1, 1996, each payment shall be in an amount
5equal to 22.5% of the taxpayer's actual liability for the
6month or 25% of the taxpayer's liability for the same calendar
7month of the preceding year or 100% of the taxpayer's actual
8liability for the quarter monthly reporting period. The amount
9of such quarter monthly payments shall be credited against the
10final tax liability of the taxpayer's return for that month.
11Before October 1, 2000, once applicable, the requirement of
12the making of quarter monthly payments to the Department shall
13continue until such taxpayer's average monthly liability to
14the Department during the preceding 4 complete calendar
15quarters (excluding the month of highest liability and the
16month of lowest liability) is less than $9,000, or until such
17taxpayer's average monthly liability to the Department as
18computed for each calendar quarter of the 4 preceding complete
19calendar quarter period is less than $10,000. However, if a
20taxpayer can show the Department that a substantial change in
21the taxpayer's business has occurred which causes the taxpayer
22to anticipate that his average monthly tax liability for the
23reasonably foreseeable future will fall below the $10,000
24threshold stated above, then such taxpayer may petition the
25Department for change in such taxpayer's reporting status. On
26and after October 1, 2000, once applicable, the requirement of

 

 

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1the making of quarter monthly payments to the Department shall
2continue until such taxpayer's average monthly liability to
3the Department during the preceding 4 complete calendar
4quarters (excluding the month of highest liability and the
5month of lowest liability) is less than $19,000 or until such
6taxpayer's average monthly liability to the Department as
7computed for each calendar quarter of the 4 preceding complete
8calendar quarter period is less than $20,000. However, if a
9taxpayer can show the Department that a substantial change in
10the taxpayer's business has occurred which causes the taxpayer
11to anticipate that his average monthly tax liability for the
12reasonably foreseeable future will fall below the $20,000
13threshold stated above, then such taxpayer may petition the
14Department for a change in such taxpayer's reporting status.
15The Department shall change such taxpayer's reporting status
16unless it finds that such change is seasonal in nature and not
17likely to be long term. Quarter monthly payment status shall
18be determined under this paragraph as if the rate reduction to
190% in this amendatory Act of the 102nd General Assembly on food
20for human consumption that is to be consumed off the premises
21where it is sold (other than alcoholic beverages, food
22consisting of or infused with adult use cannabis, soft drinks,
23and food that has been prepared for immediate consumption) had
24not occurred. For quarter monthly payments due under this
25paragraph on or after July 1, 2023 and through June 30, 2024,
26"25% of the taxpayer's liability for the same calendar month

 

 

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1of the preceding year" shall be determined as if the rate
2reduction to 0% in this amendatory Act of the 102nd General
3Assembly had not occurred. If any such quarter monthly payment
4is not paid at the time or in the amount required by this
5Section, then the taxpayer shall be liable for penalties and
6interest on the difference between the minimum amount due and
7the amount of such quarter monthly payment actually and timely
8paid, except insofar as the taxpayer has previously made
9payments for that month to the Department in excess of the
10minimum payments previously due as provided in this Section.
11The Department shall make reasonable rules and regulations to
12govern the quarter monthly payment amount and quarter monthly
13payment dates for taxpayers who file on other than a calendar
14monthly basis.
15    If any such payment provided for in this Section exceeds
16the taxpayer's liabilities under this Act, the Retailers'
17Occupation Tax Act, the Service Occupation Tax Act and the
18Service Use Tax Act, as shown by an original monthly return,
19the Department shall issue to the taxpayer a credit memorandum
20no later than 30 days after the date of payment, which
21memorandum may be submitted by the taxpayer to the Department
22in payment of tax liability subsequently to be remitted by the
23taxpayer to the Department or be assigned by the taxpayer to a
24similar taxpayer under this Act, the Retailers' Occupation Tax
25Act, the Service Occupation Tax Act or the Service Use Tax Act,
26in accordance with reasonable rules and regulations to be

 

 

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1prescribed by the Department, except that if such excess
2payment is shown on an original monthly return and is made
3after December 31, 1986, no credit memorandum shall be issued,
4unless requested by the taxpayer. If no such request is made,
5the taxpayer may credit such excess payment against tax
6liability subsequently to be remitted by the taxpayer to the
7Department under this Act, the Retailers' Occupation Tax Act,
8the Service Occupation Tax Act or the Service Use Tax Act, in
9accordance with reasonable rules and regulations prescribed by
10the Department. If the Department subsequently determines that
11all or any part of the credit taken was not actually due to the
12taxpayer, the taxpayer's 2.1% or 1.75% vendor's discount shall
13be reduced by 2.1% or 1.75% of the difference between the
14credit taken and that actually due, and the taxpayer shall be
15liable for penalties and interest on such difference.
16    If the retailer is otherwise required to file a monthly
17return and if the retailer's average monthly tax liability to
18the Department does not exceed $200, the Department may
19authorize his returns to be filed on a quarter annual basis,
20with the return for January, February, and March of a given
21year being due by April 20 of such year; with the return for
22April, May and June of a given year being due by July 20 of
23such year; with the return for July, August and September of a
24given year being due by October 20 of such year, and with the
25return for October, November and December of a given year
26being due by January 20 of the following year.

 

 

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1    If the retailer is otherwise required to file a monthly or
2quarterly return and if the retailer's average monthly tax
3liability to the Department does not exceed $50, the
4Department may authorize his returns to be filed on an annual
5basis, with the return for a given year being due by January 20
6of the following year.
7    Such quarter annual and annual returns, as to form and
8substance, shall be subject to the same requirements as
9monthly returns.
10    Notwithstanding any other provision in this Act concerning
11the time within which a retailer may file his return, in the
12case of any retailer who ceases to engage in a kind of business
13which makes him responsible for filing returns under this Act,
14such retailer shall file a final return under this Act with the
15Department not more than one month after discontinuing such
16business.
17    In addition, with respect to motor vehicles, watercraft,
18aircraft, and trailers that are required to be registered with
19an agency of this State, except as otherwise provided in this
20Section, every retailer selling this kind of tangible personal
21property shall file, with the Department, upon a form to be
22prescribed and supplied by the Department, a separate return
23for each such item of tangible personal property which the
24retailer sells, except that if, in the same transaction, (i) a
25retailer of aircraft, watercraft, motor vehicles or trailers
26transfers more than one aircraft, watercraft, motor vehicle or

 

 

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1trailer to another aircraft, watercraft, motor vehicle or
2trailer retailer for the purpose of resale or (ii) a retailer
3of aircraft, watercraft, motor vehicles, or trailers transfers
4more than one aircraft, watercraft, motor vehicle, or trailer
5to a purchaser for use as a qualifying rolling stock as
6provided in Section 3-55 of this Act, then that seller may
7report the transfer of all the aircraft, watercraft, motor
8vehicles or trailers involved in that transaction to the
9Department on the same uniform invoice-transaction reporting
10return form. For purposes of this Section, "watercraft" means
11a Class 2, Class 3, or Class 4 watercraft as defined in Section
123-2 of the Boat Registration and Safety Act, a personal
13watercraft, or any boat equipped with an inboard motor.
14    In addition, with respect to motor vehicles, watercraft,
15aircraft, and trailers that are required to be registered with
16an agency of this State, every person who is engaged in the
17business of leasing or renting such items and who, in
18connection with such business, sells any such item to a
19retailer for the purpose of resale is, notwithstanding any
20other provision of this Section to the contrary, authorized to
21meet the return-filing requirement of this Act by reporting
22the transfer of all the aircraft, watercraft, motor vehicles,
23or trailers transferred for resale during a month to the
24Department on the same uniform invoice-transaction reporting
25return form on or before the 20th of the month following the
26month in which the transfer takes place. Notwithstanding any

 

 

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1other provision of this Act to the contrary, all returns filed
2under this paragraph must be filed by electronic means in the
3manner and form as required by the Department.
4    The transaction reporting return in the case of motor
5vehicles or trailers that are required to be registered with
6an agency of this State, shall be the same document as the
7Uniform Invoice referred to in Section 5-402 of the Illinois
8Vehicle Code and must show the name and address of the seller;
9the name and address of the purchaser; the amount of the
10selling price including the amount allowed by the retailer for
11traded-in property, if any; the amount allowed by the retailer
12for the traded-in tangible personal property, if any, to the
13extent to which Section 2 of this Act allows an exemption for
14the value of traded-in property; the balance payable after
15deducting such trade-in allowance from the total selling
16price; the amount of tax due from the retailer with respect to
17such transaction; the amount of tax collected from the
18purchaser by the retailer on such transaction (or satisfactory
19evidence that such tax is not due in that particular instance,
20if that is claimed to be the fact); the place and date of the
21sale; a sufficient identification of the property sold; such
22other information as is required in Section 5-402 of the
23Illinois Vehicle Code, and such other information as the
24Department may reasonably require.
25    The transaction reporting return in the case of watercraft
26and aircraft must show the name and address of the seller; the

 

 

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1name and address of the purchaser; the amount of the selling
2price including the amount allowed by the retailer for
3traded-in property, if any; the amount allowed by the retailer
4for the traded-in tangible personal property, if any, to the
5extent to which Section 2 of this Act allows an exemption for
6the value of traded-in property; the balance payable after
7deducting such trade-in allowance from the total selling
8price; the amount of tax due from the retailer with respect to
9such transaction; the amount of tax collected from the
10purchaser by the retailer on such transaction (or satisfactory
11evidence that such tax is not due in that particular instance,
12if that is claimed to be the fact); the place and date of the
13sale, a sufficient identification of the property sold, and
14such other information as the Department may reasonably
15require.
16    Such transaction reporting return shall be filed not later
17than 20 days after the date of delivery of the item that is
18being sold, but may be filed by the retailer at any time sooner
19than that if he chooses to do so. The transaction reporting
20return and tax remittance or proof of exemption from the tax
21that is imposed by this Act may be transmitted to the
22Department by way of the State agency with which, or State
23officer with whom, the tangible personal property must be
24titled or registered (if titling or registration is required)
25if the Department and such agency or State officer determine
26that this procedure will expedite the processing of

 

 

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1applications for title or registration.
2    With each such transaction reporting return, the retailer
3shall remit the proper amount of tax due (or shall submit
4satisfactory evidence that the sale is not taxable if that is
5the case), to the Department or its agents, whereupon the
6Department shall issue, in the purchaser's name, a tax receipt
7(or a certificate of exemption if the Department is satisfied
8that the particular sale is tax exempt) which such purchaser
9may submit to the agency with which, or State officer with
10whom, he must title or register the tangible personal property
11that is involved (if titling or registration is required) in
12support of such purchaser's application for an Illinois
13certificate or other evidence of title or registration to such
14tangible personal property.
15    No retailer's failure or refusal to remit tax under this
16Act precludes a user, who has paid the proper tax to the
17retailer, from obtaining his certificate of title or other
18evidence of title or registration (if titling or registration
19is required) upon satisfying the Department that such user has
20paid the proper tax (if tax is due) to the retailer. The
21Department shall adopt appropriate rules to carry out the
22mandate of this paragraph.
23    If the user who would otherwise pay tax to the retailer
24wants the transaction reporting return filed and the payment
25of tax or proof of exemption made to the Department before the
26retailer is willing to take these actions and such user has not

 

 

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1paid the tax to the retailer, such user may certify to the fact
2of such delay by the retailer, and may (upon the Department
3being satisfied of the truth of such certification) transmit
4the information required by the transaction reporting return
5and the remittance for tax or proof of exemption directly to
6the Department and obtain his tax receipt or exemption
7determination, in which event the transaction reporting return
8and tax remittance (if a tax payment was required) shall be
9credited by the Department to the proper retailer's account
10with the Department, but without the 2.1% or 1.75% discount
11provided for in this Section being allowed. When the user pays
12the tax directly to the Department, he shall pay the tax in the
13same amount and in the same form in which it would be remitted
14if the tax had been remitted to the Department by the retailer.
15    Where a retailer collects the tax with respect to the
16selling price of tangible personal property which he sells and
17the purchaser thereafter returns such tangible personal
18property and the retailer refunds the selling price thereof to
19the purchaser, such retailer shall also refund, to the
20purchaser, the tax so collected from the purchaser. When
21filing his return for the period in which he refunds such tax
22to the purchaser, the retailer may deduct the amount of the tax
23so refunded by him to the purchaser from any other use tax
24which such retailer may be required to pay or remit to the
25Department, as shown by such return, if the amount of the tax
26to be deducted was previously remitted to the Department by

 

 

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1such retailer. If the retailer has not previously remitted the
2amount of such tax to the Department, he is entitled to no
3deduction under this Act upon refunding such tax to the
4purchaser.
5    Any retailer filing a return under this Section shall also
6include (for the purpose of paying tax thereon) the total tax
7covered by such return upon the selling price of tangible
8personal property purchased by him at retail from a retailer,
9but as to which the tax imposed by this Act was not collected
10from the retailer filing such return, and such retailer shall
11remit the amount of such tax to the Department when filing such
12return.
13    If experience indicates such action to be practicable, the
14Department may prescribe and furnish a combination or joint
15return which will enable retailers, who are required to file
16returns hereunder and also under the Retailers' Occupation Tax
17Act, to furnish all the return information required by both
18Acts on the one form.
19    Where the retailer has more than one business registered
20with the Department under separate registration under this
21Act, such retailer may not file each return that is due as a
22single return covering all such registered businesses, but
23shall file separate returns for each such registered business.
24    Beginning January 1, 1990, each month the Department shall
25pay into the State and Local Sales Tax Reform Fund, a special
26fund in the State Treasury which is hereby created, the net

 

 

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1revenue realized for the preceding month from the 1% tax
2imposed under this Act.
3    Beginning January 1, 1990, each month the Department shall
4pay into the County and Mass Transit District Fund 4% of the
5net revenue realized for the preceding month from the 6.25%
6general rate on the selling price of tangible personal
7property which is purchased outside Illinois at retail from a
8retailer and which is titled or registered by an agency of this
9State's government.
10    Beginning January 1, 1990, each month the Department shall
11pay into the State and Local Sales Tax Reform Fund, a special
12fund in the State Treasury, 20% of the net revenue realized for
13the preceding month from the 6.25% general rate on the selling
14price of tangible personal property, other than (i) tangible
15personal property which is purchased outside Illinois at
16retail from a retailer and which is titled or registered by an
17agency of this State's government and (ii) aviation fuel sold
18on or after December 1, 2019. This exception for aviation fuel
19only applies for so long as the revenue use requirements of 49
20U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.
21    For aviation fuel sold on or after December 1, 2019, each
22month the Department shall pay into the State Aviation Program
23Fund 20% of the net revenue realized for the preceding month
24from the 6.25% general rate on the selling price of aviation
25fuel, less an amount estimated by the Department to be
26required for refunds of the 20% portion of the tax on aviation

 

 

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1fuel under this Act, which amount shall be deposited into the
2Aviation Fuel Sales Tax Refund Fund. The Department shall only
3pay moneys into the State Aviation Program Fund and the
4Aviation Fuels Sales Tax Refund Fund under this Act for so long
5as the revenue use requirements of 49 U.S.C. 47107(b) and 49
6U.S.C. 47133 are binding on the State.
7    Beginning August 1, 2000, each month the Department shall
8pay into the State and Local Sales Tax Reform Fund 100% of the
9net revenue realized for the preceding month from the 1.25%
10rate on the selling price of motor fuel and gasohol. Beginning
11September 1, 2010, each month the Department shall pay into
12the State and Local Sales Tax Reform Fund 100% of the net
13revenue realized for the preceding month from the 1.25% rate
14on the selling price of sales tax holiday items.
15    Beginning January 1, 1990, each month the Department shall
16pay into the Local Government Tax Fund 16% of the net revenue
17realized for the preceding month from the 6.25% general rate
18on the selling price of tangible personal property which is
19purchased outside Illinois at retail from a retailer and which
20is titled or registered by an agency of this State's
21government.
22    Beginning October 1, 2009, each month the Department shall
23pay into the Capital Projects Fund an amount that is equal to
24an amount estimated by the Department to represent 80% of the
25net revenue realized for the preceding month from the sale of
26candy, grooming and hygiene products, and soft drinks that had

 

 

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1been taxed at a rate of 1% prior to September 1, 2009 but that
2are now taxed at 6.25%.
3    Beginning July 1, 2011, each month the Department shall
4pay into the Clean Air Act Permit Fund 80% of the net revenue
5realized for the preceding month from the 6.25% general rate
6on the selling price of sorbents used in Illinois in the
7process of sorbent injection as used to comply with the
8Environmental Protection Act or the federal Clean Air Act, but
9the total payment into the Clean Air Act Permit Fund under this
10Act and the Retailers' Occupation Tax Act shall not exceed
11$2,000,000 in any fiscal year.
12    Beginning July 1, 2013, each month the Department shall
13pay into the Underground Storage Tank Fund from the proceeds
14collected under this Act, the Service Use Tax Act, the Service
15Occupation Tax Act, and the Retailers' Occupation Tax Act an
16amount equal to the average monthly deficit in the Underground
17Storage Tank Fund during the prior year, as certified annually
18by the Illinois Environmental Protection Agency, but the total
19payment into the Underground Storage Tank Fund under this Act,
20the Service Use Tax Act, the Service Occupation Tax Act, and
21the Retailers' Occupation Tax Act shall not exceed $18,000,000
22in any State fiscal year. As used in this paragraph, the
23"average monthly deficit" shall be equal to the difference
24between the average monthly claims for payment by the fund and
25the average monthly revenues deposited into the fund,
26excluding payments made pursuant to this paragraph.

 

 

10200HB1497ham001- 175 -LRB102 03513 HLH 38716 a

1    Beginning July 1, 2015, of the remainder of the moneys
2received by the Department under this Act, the Service Use Tax
3Act, the Service Occupation Tax Act, and the Retailers'
4Occupation Tax Act, each month the Department shall deposit
5$500,000 into the State Crime Laboratory Fund.
6    Of the remainder of the moneys received by the Department
7pursuant to this Act, (a) 1.75% thereof shall be paid into the
8Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on
9and after July 1, 1989, 3.8% thereof shall be paid into the
10Build Illinois Fund; provided, however, that if in any fiscal
11year the sum of (1) the aggregate of 2.2% or 3.8%, as the case
12may be, of the moneys received by the Department and required
13to be paid into the Build Illinois Fund pursuant to Section 3
14of the Retailers' Occupation Tax Act, Section 9 of the Use Tax
15Act, Section 9 of the Service Use Tax Act, and Section 9 of the
16Service Occupation Tax Act, such Acts being hereinafter called
17the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case
18may be, of moneys being hereinafter called the "Tax Act
19Amount", and (2) the amount transferred to the Build Illinois
20Fund from the State and Local Sales Tax Reform Fund shall be
21less than the Annual Specified Amount (as defined in Section 3
22of the Retailers' Occupation Tax Act), an amount equal to the
23difference shall be immediately paid into the Build Illinois
24Fund from other moneys received by the Department pursuant to
25the Tax Acts; and further provided, that if on the last
26business day of any month the sum of (1) the Tax Act Amount

 

 

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1required to be deposited into the Build Illinois Bond Account
2in the Build Illinois Fund during such month and (2) the amount
3transferred during such month to the Build Illinois Fund from
4the State and Local Sales Tax Reform Fund shall have been less
5than 1/12 of the Annual Specified Amount, an amount equal to
6the difference shall be immediately paid into the Build
7Illinois Fund from other moneys received by the Department
8pursuant to the Tax Acts; and, further provided, that in no
9event shall the payments required under the preceding proviso
10result in aggregate payments into the Build Illinois Fund
11pursuant to this clause (b) for any fiscal year in excess of
12the greater of (i) the Tax Act Amount or (ii) the Annual
13Specified Amount for such fiscal year; and, further provided,
14that the amounts payable into the Build Illinois Fund under
15this clause (b) shall be payable only until such time as the
16aggregate amount on deposit under each trust indenture
17securing Bonds issued and outstanding pursuant to the Build
18Illinois Bond Act is sufficient, taking into account any
19future investment income, to fully provide, in accordance with
20such indenture, for the defeasance of or the payment of the
21principal of, premium, if any, and interest on the Bonds
22secured by such indenture and on any Bonds expected to be
23issued thereafter and all fees and costs payable with respect
24thereto, all as certified by the Director of the Bureau of the
25Budget (now Governor's Office of Management and Budget). If on
26the last business day of any month in which Bonds are

 

 

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1outstanding pursuant to the Build Illinois Bond Act, the
2aggregate of the moneys deposited in the Build Illinois Bond
3Account in the Build Illinois Fund in such month shall be less
4than the amount required to be transferred in such month from
5the Build Illinois Bond Account to the Build Illinois Bond
6Retirement and Interest Fund pursuant to Section 13 of the
7Build Illinois Bond Act, an amount equal to such deficiency
8shall be immediately paid from other moneys received by the
9Department pursuant to the Tax Acts to the Build Illinois
10Fund; provided, however, that any amounts paid to the Build
11Illinois Fund in any fiscal year pursuant to this sentence
12shall be deemed to constitute payments pursuant to clause (b)
13of the preceding sentence and shall reduce the amount
14otherwise payable for such fiscal year pursuant to clause (b)
15of the preceding sentence. The moneys received by the
16Department pursuant to this Act and required to be deposited
17into the Build Illinois Fund are subject to the pledge, claim
18and charge set forth in Section 12 of the Build Illinois Bond
19Act.
20    Subject to payment of amounts into the Build Illinois Fund
21as provided in the preceding paragraph or in any amendment
22thereto hereafter enacted, the following specified monthly
23installment of the amount requested in the certificate of the
24Chairman of the Metropolitan Pier and Exposition Authority
25provided under Section 8.25f of the State Finance Act, but not
26in excess of the sums designated as "Total Deposit", shall be

 

 

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1deposited in the aggregate from collections under Section 9 of
2the Use Tax Act, Section 9 of the Service Use Tax Act, Section
39 of the Service Occupation Tax Act, and Section 3 of the
4Retailers' Occupation Tax Act into the McCormick Place
5Expansion Project Fund in the specified fiscal years.
6Fiscal YearTotal Deposit
71993         $0
81994 53,000,000
91995 58,000,000
101996 61,000,000
111997 64,000,000
121998 68,000,000
131999 71,000,000
142000 75,000,000
152001 80,000,000
162002 93,000,000
172003 99,000,000
182004103,000,000
192005108,000,000
202006113,000,000
212007119,000,000
222008126,000,000
232009132,000,000
242010139,000,000
252011146,000,000
262012153,000,000

 

 

10200HB1497ham001- 179 -LRB102 03513 HLH 38716 a

12013161,000,000
22014170,000,000
32015179,000,000
42016189,000,000
52017199,000,000
62018210,000,000
72019221,000,000
82020233,000,000
92021300,000,000
102022300,000,000
112023300,000,000
122024 300,000,000
132025 300,000,000
142026 300,000,000
152027 375,000,000
162028 375,000,000
172029 375,000,000
182030 375,000,000
192031 375,000,000
202032 375,000,000
212033 375,000,000
222034375,000,000
232035375,000,000
242036450,000,000
25and
26each fiscal year

 

 

10200HB1497ham001- 180 -LRB102 03513 HLH 38716 a

1thereafter that bonds
2are outstanding under
3Section 13.2 of the
4Metropolitan Pier and
5Exposition Authority Act,
6but not after fiscal year 2060.
7    Beginning July 20, 1993 and in each month of each fiscal
8year thereafter, one-eighth of the amount requested in the
9certificate of the Chairman of the Metropolitan Pier and
10Exposition Authority for that fiscal year, less the amount
11deposited into the McCormick Place Expansion Project Fund by
12the State Treasurer in the respective month under subsection
13(g) of Section 13 of the Metropolitan Pier and Exposition
14Authority Act, plus cumulative deficiencies in the deposits
15required under this Section for previous months and years,
16shall be deposited into the McCormick Place Expansion Project
17Fund, until the full amount requested for the fiscal year, but
18not in excess of the amount specified above as "Total
19Deposit", has been deposited.
20    Subject to payment of amounts into the Capital Projects
21Fund, the Clean Air Act Permit Fund, the Build Illinois Fund,
22and the McCormick Place Expansion Project Fund pursuant to the
23preceding paragraphs or in any amendments thereto hereafter
24enacted, for aviation fuel sold on or after December 1, 2019,
25the Department shall each month deposit into the Aviation Fuel
26Sales Tax Refund Fund an amount estimated by the Department to

 

 

10200HB1497ham001- 181 -LRB102 03513 HLH 38716 a

1be required for refunds of the 80% portion of the tax on
2aviation fuel under this Act. The Department shall only
3deposit moneys into the Aviation Fuel Sales Tax Refund Fund
4under this paragraph for so long as the revenue use
5requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are
6binding on the State.
7    Subject to payment of amounts into the Build Illinois Fund
8and the McCormick Place Expansion Project Fund pursuant to the
9preceding paragraphs or in any amendments thereto hereafter
10enacted, beginning July 1, 1993 and ending on September 30,
112013, the Department shall each month pay into the Illinois
12Tax Increment Fund 0.27% of 80% of the net revenue realized for
13the preceding month from the 6.25% general rate on the selling
14price of tangible personal property.
15    Subject to payment of amounts into the Build Illinois Fund
16and the McCormick Place Expansion Project Fund pursuant to the
17preceding paragraphs or in any amendments thereto hereafter
18enacted, beginning with the receipt of the first report of
19taxes paid by an eligible business and continuing for a
2025-year period, the Department shall each month pay into the
21Energy Infrastructure Fund 80% of the net revenue realized
22from the 6.25% general rate on the selling price of
23Illinois-mined coal that was sold to an eligible business. For
24purposes of this paragraph, the term "eligible business" means
25a new electric generating facility certified pursuant to
26Section 605-332 of the Department of Commerce and Economic

 

 

10200HB1497ham001- 182 -LRB102 03513 HLH 38716 a

1Opportunity Law of the Civil Administrative Code of Illinois.
2    Subject to payment of amounts into the Build Illinois
3Fund, the McCormick Place Expansion Project Fund, the Illinois
4Tax Increment Fund, and the Energy Infrastructure Fund
5pursuant to the preceding paragraphs or in any amendments to
6this Section hereafter enacted, beginning on the first day of
7the first calendar month to occur on or after August 26, 2014
8(the effective date of Public Act 98-1098), each month, from
9the collections made under Section 9 of the Use Tax Act,
10Section 9 of the Service Use Tax Act, Section 9 of the Service
11Occupation Tax Act, and Section 3 of the Retailers' Occupation
12Tax Act, the Department shall pay into the Tax Compliance and
13Administration Fund, to be used, subject to appropriation, to
14fund additional auditors and compliance personnel at the
15Department of Revenue, an amount equal to 1/12 of 5% of 80% of
16the cash receipts collected during the preceding fiscal year
17by the Audit Bureau of the Department under the Use Tax Act,
18the Service Use Tax Act, the Service Occupation Tax Act, the
19Retailers' Occupation Tax Act, and associated local occupation
20and use taxes administered by the Department.
21    Subject to payments of amounts into the Build Illinois
22Fund, the McCormick Place Expansion Project Fund, the Illinois
23Tax Increment Fund, the Energy Infrastructure Fund, and the
24Tax Compliance and Administration Fund as provided in this
25Section, beginning on July 1, 2018 the Department shall pay
26each month into the Downstate Public Transportation Fund the

 

 

10200HB1497ham001- 183 -LRB102 03513 HLH 38716 a

1moneys required to be so paid under Section 2-3 of the
2Downstate Public Transportation Act.
3    Subject to successful execution and delivery of a
4public-private agreement between the public agency and private
5entity and completion of the civic build, beginning on July 1,
62023, of the remainder of the moneys received by the
7Department under the Use Tax Act, the Service Use Tax Act, the
8Service Occupation Tax Act, and this Act, the Department shall
9deposit the following specified deposits in the aggregate from
10collections under the Use Tax Act, the Service Use Tax Act, the
11Service Occupation Tax Act, and the Retailers' Occupation Tax
12Act, as required under Section 8.25g of the State Finance Act
13for distribution consistent with the Public-Private
14Partnership for Civic and Transit Infrastructure Project Act.
15The moneys received by the Department pursuant to this Act and
16required to be deposited into the Civic and Transit
17Infrastructure Fund are subject to the pledge, claim, and
18charge set forth in Section 25-55 of the Public-Private
19Partnership for Civic and Transit Infrastructure Project Act.
20As used in this paragraph, "civic build", "private entity",
21"public-private agreement", and "public agency" have the
22meanings provided in Section 25-10 of the Public-Private
23Partnership for Civic and Transit Infrastructure Project Act.
24        Fiscal Year............................Total Deposit
25        2024....................................$200,000,000
26        2025....................................$206,000,000

 

 

10200HB1497ham001- 184 -LRB102 03513 HLH 38716 a

1        2026....................................$212,200,000
2        2027....................................$218,500,000
3        2028....................................$225,100,000
4        2029....................................$288,700,000
5        2030....................................$298,900,000
6        2031....................................$309,300,000
7        2032....................................$320,100,000
8        2033....................................$331,200,000
9        2034....................................$341,200,000
10        2035....................................$351,400,000
11        2036....................................$361,900,000
12        2037....................................$372,800,000
13        2038....................................$384,000,000
14        2039....................................$395,500,000
15        2040....................................$407,400,000
16        2041....................................$419,600,000
17        2042....................................$432,200,000
18        2043....................................$445,100,000
19    Beginning July 1, 2021 and until July 1, 2022, subject to
20the payment of amounts into the State and Local Sales Tax
21Reform Fund, the Build Illinois Fund, the McCormick Place
22Expansion Project Fund, the Illinois Tax Increment Fund, the
23Energy Infrastructure Fund, and the Tax Compliance and
24Administration Fund as provided in this Section, the
25Department shall pay each month into the Road Fund the amount
26estimated to represent 16% of the net revenue realized from

 

 

10200HB1497ham001- 185 -LRB102 03513 HLH 38716 a

1the taxes imposed on motor fuel and gasohol. Beginning July 1,
22022 and until July 1, 2023, subject to the payment of amounts
3into the State and Local Sales Tax Reform Fund, the Build
4Illinois Fund, the McCormick Place Expansion Project Fund, the
5Illinois Tax Increment Fund, the Energy Infrastructure Fund,
6and the Tax Compliance and Administration Fund as provided in
7this Section, the Department shall pay each month into the
8Road Fund the amount estimated to represent 32% of the net
9revenue realized from the taxes imposed on motor fuel and
10gasohol. Beginning July 1, 2023 and until July 1, 2024,
11subject to the payment of amounts into the State and Local
12Sales Tax Reform Fund, the Build Illinois Fund, the McCormick
13Place Expansion Project Fund, the Illinois Tax Increment Fund,
14the Energy Infrastructure Fund, and the Tax Compliance and
15Administration Fund as provided in this Section, the
16Department shall pay each month into the Road Fund the amount
17estimated to represent 48% of the net revenue realized from
18the taxes imposed on motor fuel and gasohol. Beginning July 1,
192024 and until July 1, 2025, subject to the payment of amounts
20into the State and Local Sales Tax Reform Fund, the Build
21Illinois Fund, the McCormick Place Expansion Project Fund, the
22Illinois Tax Increment Fund, the Energy Infrastructure Fund,
23and the Tax Compliance and Administration Fund as provided in
24this Section, the Department shall pay each month into the
25Road Fund the amount estimated to represent 64% of the net
26revenue realized from the taxes imposed on motor fuel and

 

 

10200HB1497ham001- 186 -LRB102 03513 HLH 38716 a

1gasohol. Beginning on July 1, 2025, subject to the payment of
2amounts into the State and Local Sales Tax Reform Fund, the
3Build Illinois Fund, the McCormick Place Expansion Project
4Fund, the Illinois Tax Increment Fund, the Energy
5Infrastructure Fund, and the Tax Compliance and Administration
6Fund as provided in this Section, the Department shall pay
7each month into the Road Fund the amount estimated to
8represent 80% of the net revenue realized from the taxes
9imposed on motor fuel and gasohol. As used in this paragraph
10"motor fuel" has the meaning given to that term in Section 1.1
11of the Motor Fuel Tax Law Act, and "gasohol" has the meaning
12given to that term in Section 3-40 of this Act.
13    Of the remainder of the moneys received by the Department
14pursuant to this Act, 75% thereof shall be paid into the State
15Treasury and 25% shall be reserved in a special account and
16used only for the transfer to the Common School Fund as part of
17the monthly transfer from the General Revenue Fund in
18accordance with Section 8a of the State Finance Act.
19    As soon as possible after the first day of each month, upon
20certification of the Department of Revenue, the Comptroller
21shall order transferred and the Treasurer shall transfer from
22the General Revenue Fund to the Motor Fuel Tax Fund an amount
23equal to 1.7% of 80% of the net revenue realized under this Act
24for the second preceding month. Beginning April 1, 2000, this
25transfer is no longer required and shall not be made.
26    Net revenue realized for a month shall be the revenue

 

 

10200HB1497ham001- 187 -LRB102 03513 HLH 38716 a

1collected by the State pursuant to this Act, less the amount
2paid out during that month as refunds to taxpayers for
3overpayment of liability.
4    For greater simplicity of administration, manufacturers,
5importers and wholesalers whose products are sold at retail in
6Illinois by numerous retailers, and who wish to do so, may
7assume the responsibility for accounting and paying to the
8Department all tax accruing under this Act with respect to
9such sales, if the retailers who are affected do not make
10written objection to the Department to this arrangement.
11(Source: P.A. 100-303, eff. 8-24-17; 100-363, eff. 7-1-18;
12100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; 101-10, Article
1315, Section 15-10, eff. 6-5-19; 101-10, Article 25, Section
1425-105, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff.
156-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20.)
 
16    Section 50-20. The Service Use Tax Act is amended by
17changing Sections 3-10 and 9 as follows:
 
18    (35 ILCS 110/3-10)  (from Ch. 120, par. 439.33-10)
19    Sec. 3-10. Rate of tax. Unless otherwise provided in this
20Section, the tax imposed by this Act is at the rate of 6.25% of
21the selling price of tangible personal property transferred as
22an incident to the sale of service, but, for the purpose of
23computing this tax, in no event shall the selling price be less
24than the cost price of the property to the serviceman.

 

 

10200HB1497ham001- 188 -LRB102 03513 HLH 38716 a

1    Beginning on July 1, 2000 and through December 31, 2000,
2with respect to motor fuel, as defined in Section 1.1 of the
3Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
4the Use Tax Act, the tax is imposed at the rate of 1.25%.
5    With respect to gasohol, as defined in the Use Tax Act, the
6tax imposed by this Act applies to (i) 70% of the selling price
7of property transferred as an incident to the sale of service
8on or after January 1, 1990, and before July 1, 2003, (ii) 80%
9of the selling price of property transferred as an incident to
10the sale of service on or after July 1, 2003 and on or before
11July 1, 2017, and (iii) 100% of the selling price thereafter.
12If, at any time, however, the tax under this Act on sales of
13gasohol, as defined in the Use Tax Act, is imposed at the rate
14of 1.25%, then the tax imposed by this Act applies to 100% of
15the proceeds of sales of gasohol made during that time.
16    With respect to majority blended ethanol fuel, as defined
17in the Use Tax Act, the tax imposed by this Act does not apply
18to the selling price of property transferred as an incident to
19the sale of service on or after July 1, 2003 and on or before
20December 31, 2023 but applies to 100% of the selling price
21thereafter.
22    With respect to biodiesel blends, as defined in the Use
23Tax Act, with no less than 1% and no more than 10% biodiesel,
24the tax imposed by this Act applies to (i) 80% of the selling
25price of property transferred as an incident to the sale of
26service on or after July 1, 2003 and on or before December 31,

 

 

10200HB1497ham001- 189 -LRB102 03513 HLH 38716 a

12018 and (ii) 100% of the proceeds of the selling price
2thereafter. If, at any time, however, the tax under this Act on
3sales of biodiesel blends, as defined in the Use Tax Act, with
4no less than 1% and no more than 10% biodiesel is imposed at
5the rate of 1.25%, then the tax imposed by this Act applies to
6100% of the proceeds of sales of biodiesel blends with no less
7than 1% and no more than 10% biodiesel made during that time.
8    With respect to 100% biodiesel, as defined in the Use Tax
9Act, and biodiesel blends, as defined in the Use Tax Act, with
10more than 10% but no more than 99% biodiesel, the tax imposed
11by this Act does not apply to the proceeds of the selling price
12of property transferred as an incident to the sale of service
13on or after July 1, 2003 and on or before December 31, 2023 but
14applies to 100% of the selling price thereafter.
15    At the election of any registered serviceman made for each
16fiscal year, sales of service in which the aggregate annual
17cost price of tangible personal property transferred as an
18incident to the sales of service is less than 35%, or 75% in
19the case of servicemen transferring prescription drugs or
20servicemen engaged in graphic arts production, of the
21aggregate annual total gross receipts from all sales of
22service, the tax imposed by this Act shall be based on the
23serviceman's cost price of the tangible personal property
24transferred as an incident to the sale of those services.
25    Until July 1, 2022 and beginning again on July 1, 2023, the
26The tax shall be imposed at the rate of 1% on food prepared for

 

 

10200HB1497ham001- 190 -LRB102 03513 HLH 38716 a

1immediate consumption and transferred incident to a sale of
2service subject to this Act or the Service Occupation Tax Act
3by an entity licensed under the Hospital Licensing Act, the
4Nursing Home Care Act, the Assisted Living and Shared Housing
5Act, the ID/DD Community Care Act, the MC/DD Act, the
6Specialized Mental Health Rehabilitation Act of 2013, or the
7Child Care Act of 1969, or an entity that holds a permit issued
8pursuant to the Life Care Facilities Act. Until July 1, 2022
9and beginning again on July 1, 2023, the The tax shall also be
10imposed at the rate of 1% on food for human consumption that is
11to be consumed off the premises where it is sold (other than
12alcoholic beverages, food consisting of or infused with adult
13use cannabis, soft drinks, and food that has been prepared for
14immediate consumption and is not otherwise included in this
15paragraph).
16    Beginning on July 1, 2022 and until July 1, 2023, the tax
17shall be imposed at the rate of 0% on food prepared for
18immediate consumption and transferred incident to a sale of
19service subject to this Act or the Service Occupation Tax Act
20by an entity licensed under the Hospital Licensing Act, the
21Nursing Home Care Act, the Assisted Living and Shared Housing
22Act, the ID/DD Community Care Act, the MC/DD Act, the
23Specialized Mental Health Rehabilitation Act of 2013, or the
24Child Care Act of 1969, or an entity that holds a permit issued
25pursuant to the Life Care Facilities Act. Beginning on July 1,
262022 and until July 1, 2023, the tax shall also be imposed at

 

 

10200HB1497ham001- 191 -LRB102 03513 HLH 38716 a

1the rate of 0% on food for human consumption that is to be
2consumed off the premises where it is sold (other than
3alcoholic beverages, food consisting of or infused with adult
4use cannabis, soft drinks, and food that has been prepared for
5immediate consumption and is not otherwise included in this
6paragraph).
7    The tax shall also be imposed at the rate of 1% on and
8prescription and nonprescription medicines, drugs, medical
9appliances, products classified as Class III medical devices
10by the United States Food and Drug Administration that are
11used for cancer treatment pursuant to a prescription, as well
12as any accessories and components related to those devices,
13modifications to a motor vehicle for the purpose of rendering
14it usable by a person with a disability, and insulin, blood
15sugar testing materials, syringes, and needles used by human
16diabetics. For the purposes of this Section, until September
171, 2009: the term "soft drinks" means any complete, finished,
18ready-to-use, non-alcoholic drink, whether carbonated or not,
19including but not limited to soda water, cola, fruit juice,
20vegetable juice, carbonated water, and all other preparations
21commonly known as soft drinks of whatever kind or description
22that are contained in any closed or sealed bottle, can,
23carton, or container, regardless of size; but "soft drinks"
24does not include coffee, tea, non-carbonated water, infant
25formula, milk or milk products as defined in the Grade A
26Pasteurized Milk and Milk Products Act, or drinks containing

 

 

10200HB1497ham001- 192 -LRB102 03513 HLH 38716 a

150% or more natural fruit or vegetable juice.
2    Notwithstanding any other provisions of this Act,
3beginning September 1, 2009, "soft drinks" means non-alcoholic
4beverages that contain natural or artificial sweeteners. "Soft
5drinks" do not include beverages that contain milk or milk
6products, soy, rice or similar milk substitutes, or greater
7than 50% of vegetable or fruit juice by volume.
8    Until August 1, 2009, and notwithstanding any other
9provisions of this Act, "food for human consumption that is to
10be consumed off the premises where it is sold" includes all
11food sold through a vending machine, except soft drinks and
12food products that are dispensed hot from a vending machine,
13regardless of the location of the vending machine. Beginning
14August 1, 2009, and notwithstanding any other provisions of
15this Act, "food for human consumption that is to be consumed
16off the premises where it is sold" includes all food sold
17through a vending machine, except soft drinks, candy, and food
18products that are dispensed hot from a vending machine,
19regardless of the location of the vending machine.
20    Notwithstanding any other provisions of this Act,
21beginning September 1, 2009, "food for human consumption that
22is to be consumed off the premises where it is sold" does not
23include candy. For purposes of this Section, "candy" means a
24preparation of sugar, honey, or other natural or artificial
25sweeteners in combination with chocolate, fruits, nuts or
26other ingredients or flavorings in the form of bars, drops, or

 

 

10200HB1497ham001- 193 -LRB102 03513 HLH 38716 a

1pieces. "Candy" does not include any preparation that contains
2flour or requires refrigeration.
3    Notwithstanding any other provisions of this Act,
4beginning September 1, 2009, "nonprescription medicines and
5drugs" does not include grooming and hygiene products. For
6purposes of this Section, "grooming and hygiene products"
7includes, but is not limited to, soaps and cleaning solutions,
8shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
9lotions and screens, unless those products are available by
10prescription only, regardless of whether the products meet the
11definition of "over-the-counter-drugs". For the purposes of
12this paragraph, "over-the-counter-drug" means a drug for human
13use that contains a label that identifies the product as a drug
14as required by 21 C.F.R. 201.66. The "over-the-counter-drug"
15label includes:
16        (A) A "Drug Facts" panel; or
17        (B) A statement of the "active ingredient(s)" with a
18    list of those ingredients contained in the compound,
19    substance or preparation.
20    Beginning on January 1, 2014 (the effective date of Public
21Act 98-122), "prescription and nonprescription medicines and
22drugs" includes medical cannabis purchased from a registered
23dispensing organization under the Compassionate Use of Medical
24Cannabis Program Act.
25    As used in this Section, "adult use cannabis" means
26cannabis subject to tax under the Cannabis Cultivation

 

 

10200HB1497ham001- 194 -LRB102 03513 HLH 38716 a

1Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
2and does not include cannabis subject to tax under the
3Compassionate Use of Medical Cannabis Program Act.
4    If the property that is acquired from a serviceman is
5acquired outside Illinois and used outside Illinois before
6being brought to Illinois for use here and is taxable under
7this Act, the "selling price" on which the tax is computed
8shall be reduced by an amount that represents a reasonable
9allowance for depreciation for the period of prior
10out-of-state use.
11(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
12102-4, eff. 4-27-21; 102-16, eff. 6-17-21.)
 
13    (35 ILCS 110/9)  (from Ch. 120, par. 439.39)
14    Sec. 9. Each serviceman required or authorized to collect
15the tax herein imposed shall pay to the Department the amount
16of such tax (except as otherwise provided) at the time when he
17is required to file his return for the period during which such
18tax was collected, less a discount of 2.1% prior to January 1,
191990 and 1.75% on and after January 1, 1990, or $5 per calendar
20year, whichever is greater, which is allowed to reimburse the
21serviceman for expenses incurred in collecting the tax,
22keeping records, preparing and filing returns, remitting the
23tax and supplying data to the Department on request. When
24determining the discount allowed under this Section,
25servicemen shall include the amount of tax that would have

 

 

10200HB1497ham001- 195 -LRB102 03513 HLH 38716 a

1been due at the 1% rate but for the 0% rate imposed under this
2amendatory Act of the 102nd General Assembly. The discount
3under this Section is not allowed for the 1.25% portion of
4taxes paid on aviation fuel that is subject to the revenue use
5requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133. The
6discount allowed under this Section is allowed only for
7returns that are filed in the manner required by this Act. The
8Department may disallow the discount for servicemen whose
9certificate of registration is revoked at the time the return
10is filed, but only if the Department's decision to revoke the
11certificate of registration has become final. A serviceman
12need not remit that part of any tax collected by him to the
13extent that he is required to pay and does pay the tax imposed
14by the Service Occupation Tax Act with respect to his sale of
15service involving the incidental transfer by him of the same
16property.
17    Except as provided hereinafter in this Section, on or
18before the twentieth day of each calendar month, such
19serviceman shall file a return for the preceding calendar
20month in accordance with reasonable Rules and Regulations to
21be promulgated by the Department. Such return shall be filed
22on a form prescribed by the Department and shall contain such
23information as the Department may reasonably require. The
24return shall include the gross receipts which were received
25during the preceding calendar month or quarter on the
26following items upon which tax would have been due but for the

 

 

10200HB1497ham001- 196 -LRB102 03513 HLH 38716 a

10% rate imposed under this amendatory Act of the 102nd General
2Assembly: (i) food for human consumption that is to be
3consumed off the premises where it is sold (other than
4alcoholic beverages, food consisting of or infused with adult
5use cannabis, soft drinks, and food that has been prepared for
6immediate consumption); and (ii) food prepared for immediate
7consumption and transferred incident to a sale of service
8subject to this Act or the Service Occupation Tax Act by an
9entity licensed under the Hospital Licensing Act, the Nursing
10Home Care Act, the Assisted Living and Shared Housing Act, the
11ID/DD Community Care Act, the MC/DD Act, the Specialized
12Mental Health Rehabilitation Act of 2013, or the Child Care
13Act of 1969, or an entity that holds a permit issued pursuant
14to the Life Care Facilities Act. The return shall also include
15the amount of tax that would have been due on the items listed
16in the previous sentence but for the 0% rate imposed under this
17amendatory Act of the 102nd General Assembly.
18    On and after January 1, 2018, with respect to servicemen
19whose annual gross receipts average $20,000 or more, all
20returns required to be filed pursuant to this Act shall be
21filed electronically. Servicemen who demonstrate that they do
22not have access to the Internet or demonstrate hardship in
23filing electronically may petition the Department to waive the
24electronic filing requirement.
25    The Department may require returns to be filed on a
26quarterly basis. If so required, a return for each calendar

 

 

10200HB1497ham001- 197 -LRB102 03513 HLH 38716 a

1quarter shall be filed on or before the twentieth day of the
2calendar month following the end of such calendar quarter. The
3taxpayer shall also file a return with the Department for each
4of the first two months of each calendar quarter, on or before
5the twentieth day of the following calendar month, stating:
6        1. The name of the seller;
7        2. The address of the principal place of business from
8    which he engages in business as a serviceman in this
9    State;
10        3. The total amount of taxable receipts received by
11    him during the preceding calendar month, including
12    receipts from charge and time sales, but less all
13    deductions allowed by law;
14        4. The amount of credit provided in Section 2d of this
15    Act;
16        5. The amount of tax due;
17        5-5. The signature of the taxpayer; and
18        6. Such other reasonable information as the Department
19    may require.
20    Each serviceman required or authorized to collect the tax
21imposed by this Act on aviation fuel transferred as an
22incident of a sale of service in this State during the
23preceding calendar month shall, instead of reporting and
24paying tax on aviation fuel as otherwise required by this
25Section, report and pay such tax on a separate aviation fuel
26tax return. The requirements related to the return shall be as

 

 

10200HB1497ham001- 198 -LRB102 03513 HLH 38716 a

1otherwise provided in this Section. Notwithstanding any other
2provisions of this Act to the contrary, servicemen collecting
3tax on aviation fuel shall file all aviation fuel tax returns
4and shall make all aviation fuel tax payments by electronic
5means in the manner and form required by the Department. For
6purposes of this Section, "aviation fuel" means jet fuel and
7aviation gasoline.
8    If a taxpayer fails to sign a return within 30 days after
9the proper notice and demand for signature by the Department,
10the return shall be considered valid and any amount shown to be
11due on the return shall be deemed assessed.
12    Notwithstanding any other provision of this Act to the
13contrary, servicemen subject to tax on cannabis shall file all
14cannabis tax returns and shall make all cannabis tax payments
15by electronic means in the manner and form required by the
16Department.
17    Beginning October 1, 1993, a taxpayer who has an average
18monthly tax liability of $150,000 or more shall make all
19payments required by rules of the Department by electronic
20funds transfer. Beginning October 1, 1994, a taxpayer who has
21an average monthly tax liability of $100,000 or more shall
22make all payments required by rules of the Department by
23electronic funds transfer. Beginning October 1, 1995, a
24taxpayer who has an average monthly tax liability of $50,000
25or more shall make all payments required by rules of the
26Department by electronic funds transfer. Beginning October 1,

 

 

10200HB1497ham001- 199 -LRB102 03513 HLH 38716 a

12000, a taxpayer who has an annual tax liability of $200,000 or
2more shall make all payments required by rules of the
3Department by electronic funds transfer. The term "annual tax
4liability" shall be the sum of the taxpayer's liabilities
5under this Act, and under all other State and local occupation
6and use tax laws administered by the Department, for the
7immediately preceding calendar year. The term "average monthly
8tax liability" means the sum of the taxpayer's liabilities
9under this Act, and under all other State and local occupation
10and use tax laws administered by the Department, for the
11immediately preceding calendar year divided by 12. Beginning
12on October 1, 2002, a taxpayer who has a tax liability in the
13amount set forth in subsection (b) of Section 2505-210 of the
14Department of Revenue Law shall make all payments required by
15rules of the Department by electronic funds transfer.
16    Before August 1 of each year beginning in 1993, the
17Department shall notify all taxpayers required to make
18payments by electronic funds transfer. All taxpayers required
19to make payments by electronic funds transfer shall make those
20payments for a minimum of one year beginning on October 1.
21    Any taxpayer not required to make payments by electronic
22funds transfer may make payments by electronic funds transfer
23with the permission of the Department.
24    All taxpayers required to make payment by electronic funds
25transfer and any taxpayers authorized to voluntarily make
26payments by electronic funds transfer shall make those

 

 

10200HB1497ham001- 200 -LRB102 03513 HLH 38716 a

1payments in the manner authorized by the Department.
2    The Department shall adopt such rules as are necessary to
3effectuate a program of electronic funds transfer and the
4requirements of this Section.
5    If the serviceman is otherwise required to file a monthly
6return and if the serviceman's average monthly tax liability
7to the Department does not exceed $200, the Department may
8authorize his returns to be filed on a quarter annual basis,
9with the return for January, February and March of a given year
10being due by April 20 of such year; with the return for April,
11May and June of a given year being due by July 20 of such year;
12with the return for July, August and September of a given year
13being due by October 20 of such year, and with the return for
14October, November and December of a given year being due by
15January 20 of the following year.
16    If the serviceman is otherwise required to file a monthly
17or quarterly return and if the serviceman's average monthly
18tax liability to the Department does not exceed $50, the
19Department may authorize his returns to be filed on an annual
20basis, with the return for a given year being due by January 20
21of the following year.
22    Such quarter annual and annual returns, as to form and
23substance, shall be subject to the same requirements as
24monthly returns.
25    Notwithstanding any other provision in this Act concerning
26the time within which a serviceman may file his return, in the

 

 

10200HB1497ham001- 201 -LRB102 03513 HLH 38716 a

1case of any serviceman who ceases to engage in a kind of
2business which makes him responsible for filing returns under
3this Act, such serviceman shall file a final return under this
4Act with the Department not more than 1 month after
5discontinuing such business.
6    Where a serviceman collects the tax with respect to the
7selling price of property which he sells and the purchaser
8thereafter returns such property and the serviceman refunds
9the selling price thereof to the purchaser, such serviceman
10shall also refund, to the purchaser, the tax so collected from
11the purchaser. When filing his return for the period in which
12he refunds such tax to the purchaser, the serviceman may
13deduct the amount of the tax so refunded by him to the
14purchaser from any other Service Use Tax, Service Occupation
15Tax, retailers' occupation tax or use tax which such
16serviceman may be required to pay or remit to the Department,
17as shown by such return, provided that the amount of the tax to
18be deducted shall previously have been remitted to the
19Department by such serviceman. If the serviceman shall not
20previously have remitted the amount of such tax to the
21Department, he shall be entitled to no deduction hereunder
22upon refunding such tax to the purchaser.
23    Any serviceman filing a return hereunder shall also
24include the total tax upon the selling price of tangible
25personal property purchased for use by him as an incident to a
26sale of service, and such serviceman shall remit the amount of

 

 

10200HB1497ham001- 202 -LRB102 03513 HLH 38716 a

1such tax to the Department when filing such return.
2    If experience indicates such action to be practicable, the
3Department may prescribe and furnish a combination or joint
4return which will enable servicemen, who are required to file
5returns hereunder and also under the Service Occupation Tax
6Act, to furnish all the return information required by both
7Acts on the one form.
8    Where the serviceman has more than one business registered
9with the Department under separate registration hereunder,
10such serviceman shall not file each return that is due as a
11single return covering all such registered businesses, but
12shall file separate returns for each such registered business.
13    Beginning January 1, 1990, each month the Department shall
14pay into the State and Local Tax Reform Fund, a special fund in
15the State Treasury, the net revenue realized for the preceding
16month from the 1% tax imposed under this Act.
17    Beginning January 1, 1990, each month the Department shall
18pay into the State and Local Sales Tax Reform Fund 20% of the
19net revenue realized for the preceding month from the 6.25%
20general rate on transfers of tangible personal property, other
21than (i) tangible personal property which is purchased outside
22Illinois at retail from a retailer and which is titled or
23registered by an agency of this State's government and (ii)
24aviation fuel sold on or after December 1, 2019. This
25exception for aviation fuel only applies for so long as the
26revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.

 

 

10200HB1497ham001- 203 -LRB102 03513 HLH 38716 a

147133 are binding on the State.
2    For aviation fuel sold on or after December 1, 2019, each
3month the Department shall pay into the State Aviation Program
4Fund 20% of the net revenue realized for the preceding month
5from the 6.25% general rate on the selling price of aviation
6fuel, less an amount estimated by the Department to be
7required for refunds of the 20% portion of the tax on aviation
8fuel under this Act, which amount shall be deposited into the
9Aviation Fuel Sales Tax Refund Fund. The Department shall only
10pay moneys into the State Aviation Program Fund and the
11Aviation Fuel Sales Tax Refund Fund under this Act for so long
12as the revenue use requirements of 49 U.S.C. 47107(b) and 49
13U.S.C. 47133 are binding on the State.
14    Beginning August 1, 2000, each month the Department shall
15pay into the State and Local Sales Tax Reform Fund 100% of the
16net revenue realized for the preceding month from the 1.25%
17rate on the selling price of motor fuel and gasohol.
18    Beginning October 1, 2009, each month the Department shall
19pay into the Capital Projects Fund an amount that is equal to
20an amount estimated by the Department to represent 80% of the
21net revenue realized for the preceding month from the sale of
22candy, grooming and hygiene products, and soft drinks that had
23been taxed at a rate of 1% prior to September 1, 2009 but that
24are now taxed at 6.25%.
25    Beginning July 1, 2013, each month the Department shall
26pay into the Underground Storage Tank Fund from the proceeds

 

 

10200HB1497ham001- 204 -LRB102 03513 HLH 38716 a

1collected under this Act, the Use Tax Act, the Service
2Occupation Tax Act, and the Retailers' Occupation Tax Act an
3amount equal to the average monthly deficit in the Underground
4Storage Tank Fund during the prior year, as certified annually
5by the Illinois Environmental Protection Agency, but the total
6payment into the Underground Storage Tank Fund under this Act,
7the Use Tax Act, the Service Occupation Tax Act, and the
8Retailers' Occupation Tax Act shall not exceed $18,000,000 in
9any State fiscal year. As used in this paragraph, the "average
10monthly deficit" shall be equal to the difference between the
11average monthly claims for payment by the fund and the average
12monthly revenues deposited into the fund, excluding payments
13made pursuant to this paragraph.
14    Beginning July 1, 2015, of the remainder of the moneys
15received by the Department under the Use Tax Act, this Act, the
16Service Occupation Tax Act, and the Retailers' Occupation Tax
17Act, each month the Department shall deposit $500,000 into the
18State Crime Laboratory Fund.
19    Of the remainder of the moneys received by the Department
20pursuant to this Act, (a) 1.75% thereof shall be paid into the
21Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on
22and after July 1, 1989, 3.8% thereof shall be paid into the
23Build Illinois Fund; provided, however, that if in any fiscal
24year the sum of (1) the aggregate of 2.2% or 3.8%, as the case
25may be, of the moneys received by the Department and required
26to be paid into the Build Illinois Fund pursuant to Section 3

 

 

10200HB1497ham001- 205 -LRB102 03513 HLH 38716 a

1of the Retailers' Occupation Tax Act, Section 9 of the Use Tax
2Act, Section 9 of the Service Use Tax Act, and Section 9 of the
3Service Occupation Tax Act, such Acts being hereinafter called
4the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case
5may be, of moneys being hereinafter called the "Tax Act
6Amount", and (2) the amount transferred to the Build Illinois
7Fund from the State and Local Sales Tax Reform Fund shall be
8less than the Annual Specified Amount (as defined in Section 3
9of the Retailers' Occupation Tax Act), an amount equal to the
10difference shall be immediately paid into the Build Illinois
11Fund from other moneys received by the Department pursuant to
12the Tax Acts; and further provided, that if on the last
13business day of any month the sum of (1) the Tax Act Amount
14required to be deposited into the Build Illinois Bond Account
15in the Build Illinois Fund during such month and (2) the amount
16transferred during such month to the Build Illinois Fund from
17the State and Local Sales Tax Reform Fund shall have been less
18than 1/12 of the Annual Specified Amount, an amount equal to
19the difference shall be immediately paid into the Build
20Illinois Fund from other moneys received by the Department
21pursuant to the Tax Acts; and, further provided, that in no
22event shall the payments required under the preceding proviso
23result in aggregate payments into the Build Illinois Fund
24pursuant to this clause (b) for any fiscal year in excess of
25the greater of (i) the Tax Act Amount or (ii) the Annual
26Specified Amount for such fiscal year; and, further provided,

 

 

10200HB1497ham001- 206 -LRB102 03513 HLH 38716 a

1that the amounts payable into the Build Illinois Fund under
2this clause (b) shall be payable only until such time as the
3aggregate amount on deposit under each trust indenture
4securing Bonds issued and outstanding pursuant to the Build
5Illinois Bond Act is sufficient, taking into account any
6future investment income, to fully provide, in accordance with
7such indenture, for the defeasance of or the payment of the
8principal of, premium, if any, and interest on the Bonds
9secured by such indenture and on any Bonds expected to be
10issued thereafter and all fees and costs payable with respect
11thereto, all as certified by the Director of the Bureau of the
12Budget (now Governor's Office of Management and Budget). If on
13the last business day of any month in which Bonds are
14outstanding pursuant to the Build Illinois Bond Act, the
15aggregate of the moneys deposited in the Build Illinois Bond
16Account in the Build Illinois Fund in such month shall be less
17than the amount required to be transferred in such month from
18the Build Illinois Bond Account to the Build Illinois Bond
19Retirement and Interest Fund pursuant to Section 13 of the
20Build Illinois Bond Act, an amount equal to such deficiency
21shall be immediately paid from other moneys received by the
22Department pursuant to the Tax Acts to the Build Illinois
23Fund; provided, however, that any amounts paid to the Build
24Illinois Fund in any fiscal year pursuant to this sentence
25shall be deemed to constitute payments pursuant to clause (b)
26of the preceding sentence and shall reduce the amount

 

 

10200HB1497ham001- 207 -LRB102 03513 HLH 38716 a

1otherwise payable for such fiscal year pursuant to clause (b)
2of the preceding sentence. The moneys received by the
3Department pursuant to this Act and required to be deposited
4into the Build Illinois Fund are subject to the pledge, claim
5and charge set forth in Section 12 of the Build Illinois Bond
6Act.
7    Subject to payment of amounts into the Build Illinois Fund
8as provided in the preceding paragraph or in any amendment
9thereto hereafter enacted, the following specified monthly
10installment of the amount requested in the certificate of the
11Chairman of the Metropolitan Pier and Exposition Authority
12provided under Section 8.25f of the State Finance Act, but not
13in excess of the sums designated as "Total Deposit", shall be
14deposited in the aggregate from collections under Section 9 of
15the Use Tax Act, Section 9 of the Service Use Tax Act, Section
169 of the Service Occupation Tax Act, and Section 3 of the
17Retailers' Occupation Tax Act into the McCormick Place
18Expansion Project Fund in the specified fiscal years.
 
19Fiscal YearTotal Deposit
201993         $0
211994 53,000,000
221995 58,000,000
231996 61,000,000
241997 64,000,000
251998 68,000,000

 

 

10200HB1497ham001- 208 -LRB102 03513 HLH 38716 a

11999 71,000,000
22000 75,000,000
32001 80,000,000
42002 93,000,000
52003 99,000,000
62004103,000,000
72005108,000,000
82006113,000,000
92007119,000,000
102008126,000,000
112009132,000,000
122010139,000,000
132011146,000,000
142012153,000,000
152013161,000,000
162014170,000,000
172015179,000,000
182016189,000,000
192017199,000,000
202018210,000,000
212019221,000,000
222020233,000,000
232021300,000,000
242022300,000,000
252023300,000,000
262024 300,000,000

 

 

10200HB1497ham001- 209 -LRB102 03513 HLH 38716 a

12025 300,000,000
22026 300,000,000
32027 375,000,000
42028 375,000,000
52029 375,000,000
62030 375,000,000
72031 375,000,000
82032 375,000,000
92033 375,000,000
102034375,000,000
112035375,000,000
122036450,000,000
13and
14each fiscal year
15thereafter that bonds
16are outstanding under
17Section 13.2 of the
18Metropolitan Pier and
19Exposition Authority Act,
20but not after fiscal year 2060.
21    Beginning July 20, 1993 and in each month of each fiscal
22year thereafter, one-eighth of the amount requested in the
23certificate of the Chairman of the Metropolitan Pier and
24Exposition Authority for that fiscal year, less the amount
25deposited into the McCormick Place Expansion Project Fund by
26the State Treasurer in the respective month under subsection

 

 

10200HB1497ham001- 210 -LRB102 03513 HLH 38716 a

1(g) of Section 13 of the Metropolitan Pier and Exposition
2Authority Act, plus cumulative deficiencies in the deposits
3required under this Section for previous months and years,
4shall be deposited into the McCormick Place Expansion Project
5Fund, until the full amount requested for the fiscal year, but
6not in excess of the amount specified above as "Total
7Deposit", has been deposited.
8    Subject to payment of amounts into the Capital Projects
9Fund, the Clean Air Act Permit Fund, the Build Illinois Fund,
10and the McCormick Place Expansion Project Fund pursuant to the
11preceding paragraphs or in any amendments thereto hereafter
12enacted, for aviation fuel sold on or after December 1, 2019,
13the Department shall each month deposit into the Aviation Fuel
14Sales Tax Refund Fund an amount estimated by the Department to
15be required for refunds of the 80% portion of the tax on
16aviation fuel under this Act. The Department shall only
17deposit moneys into the Aviation Fuel Sales Tax Refund Fund
18under this paragraph for so long as the revenue use
19requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are
20binding on the State.
21    Subject to payment of amounts into the Build Illinois Fund
22and the McCormick Place Expansion Project Fund pursuant to the
23preceding paragraphs or in any amendments thereto hereafter
24enacted, beginning July 1, 1993 and ending on September 30,
252013, the Department shall each month pay into the Illinois
26Tax Increment Fund 0.27% of 80% of the net revenue realized for

 

 

10200HB1497ham001- 211 -LRB102 03513 HLH 38716 a

1the preceding month from the 6.25% general rate on the selling
2price of tangible personal property.
3    Subject to payment of amounts into the Build Illinois Fund
4and the McCormick Place Expansion Project Fund pursuant to the
5preceding paragraphs or in any amendments thereto hereafter
6enacted, beginning with the receipt of the first report of
7taxes paid by an eligible business and continuing for a
825-year period, the Department shall each month pay into the
9Energy Infrastructure Fund 80% of the net revenue realized
10from the 6.25% general rate on the selling price of
11Illinois-mined coal that was sold to an eligible business. For
12purposes of this paragraph, the term "eligible business" means
13a new electric generating facility certified pursuant to
14Section 605-332 of the Department of Commerce and Economic
15Opportunity Law of the Civil Administrative Code of Illinois.
16    Subject to payment of amounts into the Build Illinois
17Fund, the McCormick Place Expansion Project Fund, the Illinois
18Tax Increment Fund, and the Energy Infrastructure Fund
19pursuant to the preceding paragraphs or in any amendments to
20this Section hereafter enacted, beginning on the first day of
21the first calendar month to occur on or after August 26, 2014
22(the effective date of Public Act 98-1098), each month, from
23the collections made under Section 9 of the Use Tax Act,
24Section 9 of the Service Use Tax Act, Section 9 of the Service
25Occupation Tax Act, and Section 3 of the Retailers' Occupation
26Tax Act, the Department shall pay into the Tax Compliance and

 

 

10200HB1497ham001- 212 -LRB102 03513 HLH 38716 a

1Administration Fund, to be used, subject to appropriation, to
2fund additional auditors and compliance personnel at the
3Department of Revenue, an amount equal to 1/12 of 5% of 80% of
4the cash receipts collected during the preceding fiscal year
5by the Audit Bureau of the Department under the Use Tax Act,
6the Service Use Tax Act, the Service Occupation Tax Act, the
7Retailers' Occupation Tax Act, and associated local occupation
8and use taxes administered by the Department.
9    Subject to payments of amounts into the Build Illinois
10Fund, the McCormick Place Expansion Project Fund, the Illinois
11Tax Increment Fund, the Energy Infrastructure Fund, and the
12Tax Compliance and Administration Fund as provided in this
13Section, beginning on July 1, 2018 the Department shall pay
14each month into the Downstate Public Transportation Fund the
15moneys required to be so paid under Section 2-3 of the
16Downstate Public Transportation Act.
17    Subject to successful execution and delivery of a
18public-private agreement between the public agency and private
19entity and completion of the civic build, beginning on July 1,
202023, of the remainder of the moneys received by the
21Department under the Use Tax Act, the Service Use Tax Act, the
22Service Occupation Tax Act, and this Act, the Department shall
23deposit the following specified deposits in the aggregate from
24collections under the Use Tax Act, the Service Use Tax Act, the
25Service Occupation Tax Act, and the Retailers' Occupation Tax
26Act, as required under Section 8.25g of the State Finance Act

 

 

10200HB1497ham001- 213 -LRB102 03513 HLH 38716 a

1for distribution consistent with the Public-Private
2Partnership for Civic and Transit Infrastructure Project Act.
3The moneys received by the Department pursuant to this Act and
4required to be deposited into the Civic and Transit
5Infrastructure Fund are subject to the pledge, claim, and
6charge set forth in Section 25-55 of the Public-Private
7Partnership for Civic and Transit Infrastructure Project Act.
8As used in this paragraph, "civic build", "private entity",
9"public-private agreement", and "public agency" have the
10meanings provided in Section 25-10 of the Public-Private
11Partnership for Civic and Transit Infrastructure Project Act.
12        Fiscal Year............................Total Deposit
13        2024....................................$200,000,000
14        2025....................................$206,000,000
15        2026....................................$212,200,000
16        2027....................................$218,500,000
17        2028....................................$225,100,000
18        2029....................................$288,700,000
19        2030....................................$298,900,000
20        2031....................................$309,300,000
21        2032....................................$320,100,000
22        2033....................................$331,200,000
23        2034....................................$341,200,000
24        2035....................................$351,400,000
25        2036....................................$361,900,000
26        2037....................................$372,800,000

 

 

10200HB1497ham001- 214 -LRB102 03513 HLH 38716 a

1        2038....................................$384,000,000
2        2039....................................$395,500,000
3        2040....................................$407,400,000
4        2041....................................$419,600,000
5        2042....................................$432,200,000
6        2043....................................$445,100,000
7    Beginning July 1, 2021 and until July 1, 2022, subject to
8the payment of amounts into the State and Local Sales Tax
9Reform Fund, the Build Illinois Fund, the McCormick Place
10Expansion Project Fund, the Illinois Tax Increment Fund, the
11Energy Infrastructure Fund, and the Tax Compliance and
12Administration Fund as provided in this Section, the
13Department shall pay each month into the Road Fund the amount
14estimated to represent 16% of the net revenue realized from
15the taxes imposed on motor fuel and gasohol. Beginning July 1,
162022 and until July 1, 2023, subject to the payment of amounts
17into the State and Local Sales Tax Reform Fund, the Build
18Illinois Fund, the McCormick Place Expansion Project Fund, the
19Illinois Tax Increment Fund, the Energy Infrastructure Fund,
20and the Tax Compliance and Administration Fund as provided in
21this Section, the Department shall pay each month into the
22Road Fund the amount estimated to represent 32% of the net
23revenue realized from the taxes imposed on motor fuel and
24gasohol. Beginning July 1, 2023 and until July 1, 2024,
25subject to the payment of amounts into the State and Local
26Sales Tax Reform Fund, the Build Illinois Fund, the McCormick

 

 

10200HB1497ham001- 215 -LRB102 03513 HLH 38716 a

1Place Expansion Project Fund, the Illinois Tax Increment Fund,
2the Energy Infrastructure Fund, and the Tax Compliance and
3Administration Fund as provided in this Section, the
4Department shall pay each month into the Road Fund the amount
5estimated to represent 48% of the net revenue realized from
6the taxes imposed on motor fuel and gasohol. Beginning July 1,
72024 and until July 1, 2025, subject to the payment of amounts
8into the State and Local Sales Tax Reform Fund, the Build
9Illinois Fund, the McCormick Place Expansion Project Fund, the
10Illinois Tax Increment Fund, the Energy Infrastructure Fund,
11and the Tax Compliance and Administration Fund as provided in
12this Section, the Department shall pay each month into the
13Road Fund the amount estimated to represent 64% of the net
14revenue realized from the taxes imposed on motor fuel and
15gasohol. Beginning on July 1, 2025, subject to the payment of
16amounts into the State and Local Sales Tax Reform Fund, the
17Build Illinois Fund, the McCormick Place Expansion Project
18Fund, the Illinois Tax Increment Fund, the Energy
19Infrastructure Fund, and the Tax Compliance and Administration
20Fund as provided in this Section, the Department shall pay
21each month into the Road Fund the amount estimated to
22represent 80% of the net revenue realized from the taxes
23imposed on motor fuel and gasohol. As used in this paragraph
24"motor fuel" has the meaning given to that term in Section 1.1
25of the Motor Fuel Tax Law Act, and "gasohol" has the meaning
26given to that term in Section 3-40 of the Use Tax Act.

 

 

10200HB1497ham001- 216 -LRB102 03513 HLH 38716 a

1    Of the remainder of the moneys received by the Department
2pursuant to this Act, 75% thereof shall be paid into the
3General Revenue Fund of the State Treasury and 25% shall be
4reserved in a special account and used only for the transfer to
5the Common School Fund as part of the monthly transfer from the
6General Revenue Fund in accordance with Section 8a of the
7State Finance Act.
8    As soon as possible after the first day of each month, upon
9certification of the Department of Revenue, the Comptroller
10shall order transferred and the Treasurer shall transfer from
11the General Revenue Fund to the Motor Fuel Tax Fund an amount
12equal to 1.7% of 80% of the net revenue realized under this Act
13for the second preceding month. Beginning April 1, 2000, this
14transfer is no longer required and shall not be made.
15    Net revenue realized for a month shall be the revenue
16collected by the State pursuant to this Act, less the amount
17paid out during that month as refunds to taxpayers for
18overpayment of liability.
19(Source: P.A. 100-303, eff. 8-24-17; 100-363, eff. 7-1-18;
20100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; 101-10, Article
2115, Section 15-15, eff. 6-5-19; 101-10, Article 25, Section
2225-110, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff.
236-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20.)
 
24    Section 50-25. The Service Occupation Tax Act is amended
25by changing Sections 3-10 and 9 as follows:
 

 

 

10200HB1497ham001- 217 -LRB102 03513 HLH 38716 a

1    (35 ILCS 115/3-10)  (from Ch. 120, par. 439.103-10)
2    Sec. 3-10. Rate of tax. Unless otherwise provided in this
3Section, the tax imposed by this Act is at the rate of 6.25% of
4the "selling price", as defined in Section 2 of the Service Use
5Tax Act, of the tangible personal property. For the purpose of
6computing this tax, in no event shall the "selling price" be
7less than the cost price to the serviceman of the tangible
8personal property transferred. The selling price of each item
9of tangible personal property transferred as an incident of a
10sale of service may be shown as a distinct and separate item on
11the serviceman's billing to the service customer. If the
12selling price is not so shown, the selling price of the
13tangible personal property is deemed to be 50% of the
14serviceman's entire billing to the service customer. When,
15however, a serviceman contracts to design, develop, and
16produce special order machinery or equipment, the tax imposed
17by this Act shall be based on the serviceman's cost price of
18the tangible personal property transferred incident to the
19completion of the contract.
20    Beginning on July 1, 2000 and through December 31, 2000,
21with respect to motor fuel, as defined in Section 1.1 of the
22Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
23the Use Tax Act, the tax is imposed at the rate of 1.25%.
24    With respect to gasohol, as defined in the Use Tax Act, the
25tax imposed by this Act shall apply to (i) 70% of the cost

 

 

10200HB1497ham001- 218 -LRB102 03513 HLH 38716 a

1price of property transferred as an incident to the sale of
2service on or after January 1, 1990, and before July 1, 2003,
3(ii) 80% of the selling price of property transferred as an
4incident to the sale of service on or after July 1, 2003 and on
5or before July 1, 2017, and (iii) 100% of the cost price
6thereafter. If, at any time, however, the tax under this Act on
7sales of gasohol, as defined in the Use Tax Act, is imposed at
8the rate of 1.25%, then t