Sen. Celina Villanueva

Filed: 5/25/2024

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 4951

2    AMENDMENT NO. ______. Amend House Bill 4951, AS AMENDED,
3by replacing everything after the enacting clause with the
4following:
 
5
"ARTICLE 5.

 
6    Section 5-5. The Department of Revenue Law of the Civil
7Administrative Code of Illinois is amended by adding Section
82505-815 as follows:
 
9    (20 ILCS 2505/2505-815 new)
10    Sec. 2505-815. County Official Compensation Task Force.
11    (a) The County Official Compensation Task Force is created
12to review the compensation of county-level officials as
13provided for in various State statutes and to make
14recommendations to the General Assembly on any appropriate
15changes to those statutes, including implementation dates.

 

 

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1    (b) The members of the Task Force shall be as follows:
2        (1) the Director of Revenue or the Director's
3    designee, who shall serve as the chair of the Task Force;
4        (2) two representatives from a statewide organization
5    that represents chief county assessment officers, with one
6    representative from a county with a 2020 population of
7    fewer than 25,000 persons and one representative from a
8    county with a 2020 population of 25,000 or more, to be
9    appointed by the Director of Revenue;
10        (3) two representatives from a statewide organization
11    that represents county auditors, with one representative
12    from a county with a 2020 population of fewer than 25,000
13    persons and one representative from a county with a 2020
14    population of 25,000 or more, to be appointed by the
15    Director of Revenue;
16        (4) two representatives from a statewide organization
17    that represents county clerks and recorders, with one
18    representative from a county with a 2020 population of
19    fewer than 25,000 persons and one representative from a
20    county with a 2020 population of 25,000 or more, to be
21    appointed by the Director of Revenue;
22        (5) two representatives from a statewide organization
23    that represents circuit clerks, with one representative
24    from a county with a 2020 population of fewer than 25,000
25    persons and one representative from a county with a 2020
26    population of 25,000 or more, to be appointed by the Chief

 

 

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1    Justice of the Supreme Court;
2        (6) two representatives from a statewide organization
3    that represents county treasurers, with one representative
4    from a county with a 2020 population of fewer than 25,000
5    persons and one representative from a county with a 2020
6    population of 25,000 or more, to be appointed by the
7    Director of Revenue;
8        (7) four representatives from a statewide organization
9    that represents county board members, with 2
10    representatives from counties with a 2020 population of
11    fewer than 25,000 persons and 2 representatives from
12    counties with a 2020 population of 25,000 or more, to be
13    appointed by the Governor; and
14        (8) four members from the General Assembly, with one
15    member appointed by the President of the Senate, one
16    member appointed by the Senate Minority Leader, one member
17    appointed by the Speaker of the House of Representatives,
18    and one member appointed by the House Minority Leader.
19    (c) The Department of Revenue shall provide administrative
20and other support to the Task Force.
21    (d) The Task Force's review shall include, but is not
22limited to, the following subjects:
23        (1) a review and comparison of current statutory
24    provisions and requirements for compensation of
25    county-level officials;
26        (2) the proportion of salary and related costs borne

 

 

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1    by State government compared to local government;
2        (3) job duties, education requirements, and other
3    requirements of those serving as county-level officials;
4    and
5        (4) current compensation levels for county-level
6    officials as compared to comparable positions in
7    non-governmental positions and comparable positions in
8    other levels of government.
9    (e) On or before September 1, 2024, the Task Force members
10shall be appointed. On or before February 1, 2025, the Task
11Force shall prepare a status report that summarizes its work.
12The Task Force shall also prepare a comprehensive report
13either (i) on or before May 1, 2025 or (ii) on or before
14December 31, 2025, if all appointments to the Task Force are
15not made by September 1, 2024. The comprehensive report shall
16summarize the Task Force's findings and make recommendations
17on the implementation of changes to the compensation of chief
18county assessment officers, county auditors, county clerks and
19recorders, county coroners, county treasurers, and circuit
20clerks that will ensure compensation is competitive for
21recruitment and retention and will ensure parity exists among
22compensation levels within each profession, each county, and
23across the State.
24    (f) The Task Force is dissolved on January 1, 2026.
 
25
ARTICLE 10.

 

 

 

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1    Section 10-1. Short title. This Act may be cited as the
2Workforce Development through Charitable Loan Repayment Act.
3References in this Article to "this Act" mean this Article.
 
4    Section 10-5. Purpose. The purpose of this Act is to
5create a private sector incentive for qualified workers to
6work and live in eligible areas while also reducing the
7student debt burden of those workers.
 
8    Section 10-10. Definitions. As used in this Act:
9    "Commission" means the Illinois Student Assistance
10Commission.
11    "Full-time employee" means an individual who is employed
12for consideration for at least 35 hours each week.
13    "Program" means the Workforce Development Through
14Charitable Loan Repayment Program established under this Act.
15    "Qualified community foundation" means a community
16foundation or similar publicly supported organization
17described in Section 170(b)(1)(A)(vi) of the Internal Revenue
18Code of 1986 that (i) is organized or operating in this State,
19(ii) substantially complies, as determined by the Commission,
20with the national standards for United States community
21foundations established by the Community Foundations National
22Standards or a successor entity, and (iii) is approved by the
23Commission for participation in the Program as provided in

 

 

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1Section 10-17.
2    "Qualified worker" means an individual who meets all of
3the following:
4        (1) the individual is a full-time employee of a
5    business that meets one or more of the following:
6            (A) the business is a qualified new business
7        venture that is registered with the Department of
8        Commerce and Economic Opportunity under Section 220 of
9        the Illinois Income Tax Act;
10            (B) the business is primarily engaged in a
11        targeted growth industry;
12            (C) the business is a minority-owned business, a
13        women-owned business, or a business owned by a person
14        with a disability, as those terms are defined in the
15        Business Enterprise for Minorities, Women, and Persons
16        with Disabilities Act; or
17            (D) the business is a not-for-profit corporation,
18        as defined in the General Not For Profit Corporation
19        Act of 1986;
20        (2) the individual is employed by the business
21    described in paragraph (1) at a job site that is located in
22    an Enterprise Zone, an Opportunity Zone, an underserved
23    area, or an area that has a bachelor's degree attainment
24    rate for the population that is below the State or
25    national average for the population, as determined by the
26    United States Census Bureau; and

 

 

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1        (3) the individual (i) received an associate degree or
2    higher and has an outstanding balance due on a qualified
3    education loan, as defined in Section 221 of the Internal
4    Revenue Code, or (ii) accrued educational debt while
5    pursuing skilled trades and related schooling.
6    "Student loan repayment assistance" means grants or
7post-graduation scholarships made by a community foundation
8directly to a student loan servicer on behalf of a qualified
9worker.
10    "Targeted growth industry" means one or more of the
11following:
12        (1) advanced manufacturing;
13        (2) agribusiness and food processing;
14        (3) transportation distribution and logistics;
15        (4) life sciences and biotechnology;
16        (5) business and professional services; or
17        (6) energy.
18    "Underserved area" has the meaning given to that term in
19Section 5-5 of the Economic Development for a Growing Economy
20Tax Credit Act.
 
21    Section 10-15. Establishment of the Program;
22advertisement. The Workforce Development through Charitable
23Loan Repayment Program is hereby created for the purpose of
24facilitating student loan repayment assistance for qualified
25workers. The Program shall be administered by qualified

 

 

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1community foundations with the assistance of the Commission.
2The Commission shall advertise the program on its website.
 
3    Section 10-17. Approval to participate in the Program.
4    (a) A qualified community foundation shall apply to the
5Commission, in the form and manner prescribed by the
6Commission, for eligibility to participate in the Program
7under this Act. Each application shall include:
8        (1) documentary evidence that the qualified community
9    foundation meets the qualifications under Section
10    170(b)(1)(A)(vi) of the Internal Revenue Code and
11    substantially complies with the standards established by
12    Community Foundations National Standards;
13        (2) a list of the names and addresses of all members of
14    the governing board of the qualified community foundation;
15    and
16        (3) a copy of the most recent financial audit of the
17    qualified community foundation's accounts and records
18    conducted by an independent certified public accountant in
19    accordance with auditing standards generally accepted in
20    the United States, government auditing standards, and
21    rules adopted by the Commission.
22    (b) The Commission shall review and either approve or deny
23each application for participation. Applicants shall be
24notified of the status of their application within a
25reasonable amount of time after the completed application is

 

 

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1received.
2    (c) The Commission may provide, by rule, that qualified
3community foundations that are eligible to participate in tax
4incentive programs administered by other State agencies are
5automatically eligible to participate in the Program under
6this Section.
 
7    Section 10-20. Applications. Each qualified community
8foundation shall establish an application process for
9qualified workers to receive student loan repayment assistance
10from the qualified community foundation in accordance with
11this Act and rules adopted for the implementation of this Act
12by the Commission. If necessary due to limited funds, the
13qualified community foundation shall give priority to
14applicants with a higher student debt-to-income ratio when
15awarding student loan repayment assistance under the Program.
 
16    Section 10-25. Eligibility; work requirement. Each
17individual qualified community foundation shall certify the
18eligibility of qualified workers to receive student loan
19repayment assistance and establish work requirements in
20accordance with this Act, rules adopted by the Commission, and
21the requirements of the individual qualified community
22foundation.
 
23    Section 10-30. Administration; rules. Qualified community

 

 

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1foundations shall administer the Program under this Act and
2shall issue to qualified workers any forms required by the
3Commission or the Department of Revenue. The Commission shall
4adopt rules for the Program's effective implementation, except
5that rules regarding the documentation necessary to deduct
6student loan repayment assistance from the worker's income
7under subparagraph (LL) of subsection (a) of Section 203 of
8the Illinois Income Tax Act may be adopted by the Department of
9Revenue in consultation with the Commission. Individual
10qualified community foundations may impose requirements for
11participation in the Program, which shall not be inconsistent
12with this Act or the rules adopted by the Commission or the
13Department of Revenue in connection with this Act.
 
14    Section 10-35. Reporting. Each qualified community
15foundation shall submit an annual report to the Commission
16summarizing its loan repayment activity under the Program.
17Reports under this Section shall be submitted in the form and
18manner prescribed by the Commission.
 
19    Section 10-900. The Illinois Income Tax Act is amended by
20changing Section 203 as follows:
 
21    (35 ILCS 5/203)
22    Sec. 203. Base income defined.
23    (a) Individuals.

 

 

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1        (1) In general. In the case of an individual, base
2    income means an amount equal to the taxpayer's adjusted
3    gross income for the taxable year as modified by paragraph
4    (2).
5        (2) Modifications. The adjusted gross income referred
6    to in paragraph (1) shall be modified by adding thereto
7    the sum of the following amounts:
8            (A) An amount equal to all amounts paid or accrued
9        to the taxpayer as interest or dividends during the
10        taxable year to the extent excluded from gross income
11        in the computation of adjusted gross income, except
12        stock dividends of qualified public utilities
13        described in Section 305(e) of the Internal Revenue
14        Code;
15            (B) An amount equal to the amount of tax imposed by
16        this Act to the extent deducted from gross income in
17        the computation of adjusted gross income for the
18        taxable year;
19            (C) An amount equal to the amount received during
20        the taxable year as a recovery or refund of real
21        property taxes paid with respect to the taxpayer's
22        principal residence under the Revenue Act of 1939 and
23        for which a deduction was previously taken under
24        subparagraph (L) of this paragraph (2) prior to July
25        1, 1991, the retrospective application date of Article
26        4 of Public Act 87-17. In the case of multi-unit or

 

 

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1        multi-use structures and farm dwellings, the taxes on
2        the taxpayer's principal residence shall be that
3        portion of the total taxes for the entire property
4        which is attributable to such principal residence;
5            (D) An amount equal to the amount of the capital
6        gain deduction allowable under the Internal Revenue
7        Code, to the extent deducted from gross income in the
8        computation of adjusted gross income;
9            (D-5) An amount, to the extent not included in
10        adjusted gross income, equal to the amount of money
11        withdrawn by the taxpayer in the taxable year from a
12        medical care savings account and the interest earned
13        on the account in the taxable year of a withdrawal
14        pursuant to subsection (b) of Section 20 of the
15        Medical Care Savings Account Act or subsection (b) of
16        Section 20 of the Medical Care Savings Account Act of
17        2000;
18            (D-10) For taxable years ending after December 31,
19        1997, an amount equal to any eligible remediation
20        costs that the individual deducted in computing
21        adjusted gross income and for which the individual
22        claims a credit under subsection (l) of Section 201;
23            (D-15) For taxable years 2001 and thereafter, an
24        amount equal to the bonus depreciation deduction taken
25        on the taxpayer's federal income tax return for the
26        taxable year under subsection (k) of Section 168 of

 

 

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1        the Internal Revenue Code;
2            (D-16) If the taxpayer sells, transfers, abandons,
3        or otherwise disposes of property for which the
4        taxpayer was required in any taxable year to make an
5        addition modification under subparagraph (D-15), then
6        an amount equal to the aggregate amount of the
7        deductions taken in all taxable years under
8        subparagraph (Z) with respect to that property.
9            If the taxpayer continues to own property through
10        the last day of the last tax year for which a
11        subtraction is allowed with respect to that property
12        under subparagraph (Z) and for which the taxpayer was
13        allowed in any taxable year to make a subtraction
14        modification under subparagraph (Z), then an amount
15        equal to that subtraction modification.
16            The taxpayer is required to make the addition
17        modification under this subparagraph only once with
18        respect to any one piece of property;
19            (D-17) An amount equal to the amount otherwise
20        allowed as a deduction in computing base income for
21        interest paid, accrued, or incurred, directly or
22        indirectly, (i) for taxable years ending on or after
23        December 31, 2004, to a foreign person who would be a
24        member of the same unitary business group but for the
25        fact that foreign person's business activity outside
26        the United States is 80% or more of the foreign

 

 

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1        person's total business activity and (ii) for taxable
2        years ending on or after December 31, 2008, to a person
3        who would be a member of the same unitary business
4        group but for the fact that the person is prohibited
5        under Section 1501(a)(27) from being included in the
6        unitary business group because he or she is ordinarily
7        required to apportion business income under different
8        subsections of Section 304. The addition modification
9        required by this subparagraph shall be reduced to the
10        extent that dividends were included in base income of
11        the unitary group for the same taxable year and
12        received by the taxpayer or by a member of the
13        taxpayer's unitary business group (including amounts
14        included in gross income under Sections 951 through
15        964 of the Internal Revenue Code and amounts included
16        in gross income under Section 78 of the Internal
17        Revenue Code) with respect to the stock of the same
18        person to whom the interest was paid, accrued, or
19        incurred.
20            This paragraph shall not apply to the following:
21                (i) an item of interest paid, accrued, or
22            incurred, directly or indirectly, to a person who
23            is subject in a foreign country or state, other
24            than a state which requires mandatory unitary
25            reporting, to a tax on or measured by net income
26            with respect to such interest; or

 

 

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1                (ii) an item of interest paid, accrued, or
2            incurred, directly or indirectly, to a person if
3            the taxpayer can establish, based on a
4            preponderance of the evidence, both of the
5            following:
6                    (a) the person, during the same taxable
7                year, paid, accrued, or incurred, the interest
8                to a person that is not a related member, and
9                    (b) the transaction giving rise to the
10                interest expense between the taxpayer and the
11                person did not have as a principal purpose the
12                avoidance of Illinois income tax, and is paid
13                pursuant to a contract or agreement that
14                reflects an arm's-length interest rate and
15                terms; or
16                (iii) the taxpayer can establish, based on
17            clear and convincing evidence, that the interest
18            paid, accrued, or incurred relates to a contract
19            or agreement entered into at arm's-length rates
20            and terms and the principal purpose for the
21            payment is not federal or Illinois tax avoidance;
22            or
23                (iv) an item of interest paid, accrued, or
24            incurred, directly or indirectly, to a person if
25            the taxpayer establishes by clear and convincing
26            evidence that the adjustments are unreasonable; or

 

 

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1            if the taxpayer and the Director agree in writing
2            to the application or use of an alternative method
3            of apportionment under Section 304(f).
4                Nothing in this subsection shall preclude the
5            Director from making any other adjustment
6            otherwise allowed under Section 404 of this Act
7            for any tax year beginning after the effective
8            date of this amendment provided such adjustment is
9            made pursuant to regulation adopted by the
10            Department and such regulations provide methods
11            and standards by which the Department will utilize
12            its authority under Section 404 of this Act;
13            (D-18) An amount equal to the amount of intangible
14        expenses and costs otherwise allowed as a deduction in
15        computing base income, and that were paid, accrued, or
16        incurred, directly or indirectly, (i) for taxable
17        years ending on or after December 31, 2004, to a
18        foreign person who would be a member of the same
19        unitary business group but for the fact that the
20        foreign person's business activity outside the United
21        States is 80% or more of that person's total business
22        activity and (ii) for taxable years ending on or after
23        December 31, 2008, to a person who would be a member of
24        the same unitary business group but for the fact that
25        the person is prohibited under Section 1501(a)(27)
26        from being included in the unitary business group

 

 

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1        because he or she is ordinarily required to apportion
2        business income under different subsections of Section
3        304. The addition modification required by this
4        subparagraph shall be reduced to the extent that
5        dividends were included in base income of the unitary
6        group for the same taxable year and received by the
7        taxpayer or by a member of the taxpayer's unitary
8        business group (including amounts included in gross
9        income under Sections 951 through 964 of the Internal
10        Revenue Code and amounts included in gross income
11        under Section 78 of the Internal Revenue Code) with
12        respect to the stock of the same person to whom the
13        intangible expenses and costs were directly or
14        indirectly paid, incurred, or accrued. The preceding
15        sentence does not apply to the extent that the same
16        dividends caused a reduction to the addition
17        modification required under Section 203(a)(2)(D-17) of
18        this Act. As used in this subparagraph, the term
19        "intangible expenses and costs" includes (1) expenses,
20        losses, and costs for, or related to, the direct or
21        indirect acquisition, use, maintenance or management,
22        ownership, sale, exchange, or any other disposition of
23        intangible property; (2) losses incurred, directly or
24        indirectly, from factoring transactions or discounting
25        transactions; (3) royalty, patent, technical, and
26        copyright fees; (4) licensing fees; and (5) other

 

 

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1        similar expenses and costs. For purposes of this
2        subparagraph, "intangible property" includes patents,
3        patent applications, trade names, trademarks, service
4        marks, copyrights, mask works, trade secrets, and
5        similar types of intangible assets.
6            This paragraph shall not apply to the following:
7                (i) any item of intangible expenses or costs
8            paid, accrued, or incurred, directly or
9            indirectly, from a transaction with a person who
10            is subject in a foreign country or state, other
11            than a state which requires mandatory unitary
12            reporting, to a tax on or measured by net income
13            with respect to such item; or
14                (ii) any item of intangible expense or cost
15            paid, accrued, or incurred, directly or
16            indirectly, if the taxpayer can establish, based
17            on a preponderance of the evidence, both of the
18            following:
19                    (a) the person during the same taxable
20                year paid, accrued, or incurred, the
21                intangible expense or cost to a person that is
22                not a related member, and
23                    (b) the transaction giving rise to the
24                intangible expense or cost between the
25                taxpayer and the person did not have as a
26                principal purpose the avoidance of Illinois

 

 

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1                income tax, and is paid pursuant to a contract
2                or agreement that reflects arm's-length terms;
3                or
4                (iii) any item of intangible expense or cost
5            paid, accrued, or incurred, directly or
6            indirectly, from a transaction with a person if
7            the taxpayer establishes by clear and convincing
8            evidence, that the adjustments are unreasonable;
9            or if the taxpayer and the Director agree in
10            writing to the application or use of an
11            alternative method of apportionment under Section
12            304(f);
13                Nothing in this subsection shall preclude the
14            Director from making any other adjustment
15            otherwise allowed under Section 404 of this Act
16            for any tax year beginning after the effective
17            date of this amendment provided such adjustment is
18            made pursuant to regulation adopted by the
19            Department and such regulations provide methods
20            and standards by which the Department will utilize
21            its authority under Section 404 of this Act;
22            (D-19) For taxable years ending on or after
23        December 31, 2008, an amount equal to the amount of
24        insurance premium expenses and costs otherwise allowed
25        as a deduction in computing base income, and that were
26        paid, accrued, or incurred, directly or indirectly, to

 

 

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1        a person who would be a member of the same unitary
2        business group but for the fact that the person is
3        prohibited under Section 1501(a)(27) from being
4        included in the unitary business group because he or
5        she is ordinarily required to apportion business
6        income under different subsections of Section 304. The
7        addition modification required by this subparagraph
8        shall be reduced to the extent that dividends were
9        included in base income of the unitary group for the
10        same taxable year and received by the taxpayer or by a
11        member of the taxpayer's unitary business group
12        (including amounts included in gross income under
13        Sections 951 through 964 of the Internal Revenue Code
14        and amounts included in gross income under Section 78
15        of the Internal Revenue Code) with respect to the
16        stock of the same person to whom the premiums and costs
17        were directly or indirectly paid, incurred, or
18        accrued. The preceding sentence does not apply to the
19        extent that the same dividends caused a reduction to
20        the addition modification required under Section
21        203(a)(2)(D-17) or Section 203(a)(2)(D-18) of this
22        Act;
23            (D-20) For taxable years beginning on or after
24        January 1, 2002 and ending on or before December 31,
25        2006, in the case of a distribution from a qualified
26        tuition program under Section 529 of the Internal

 

 

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1        Revenue Code, other than (i) a distribution from a
2        College Savings Pool created under Section 16.5 of the
3        State Treasurer Act or (ii) a distribution from the
4        Illinois Prepaid Tuition Trust Fund, an amount equal
5        to the amount excluded from gross income under Section
6        529(c)(3)(B). For taxable years beginning on or after
7        January 1, 2007, in the case of a distribution from a
8        qualified tuition program under Section 529 of the
9        Internal Revenue Code, other than (i) a distribution
10        from a College Savings Pool created under Section 16.5
11        of the State Treasurer Act, (ii) a distribution from
12        the Illinois Prepaid Tuition Trust Fund, or (iii) a
13        distribution from a qualified tuition program under
14        Section 529 of the Internal Revenue Code that (I)
15        adopts and determines that its offering materials
16        comply with the College Savings Plans Network's
17        disclosure principles and (II) has made reasonable
18        efforts to inform in-state residents of the existence
19        of in-state qualified tuition programs by informing
20        Illinois residents directly and, where applicable, to
21        inform financial intermediaries distributing the
22        program to inform in-state residents of the existence
23        of in-state qualified tuition programs at least
24        annually, an amount equal to the amount excluded from
25        gross income under Section 529(c)(3)(B).
26            For the purposes of this subparagraph (D-20), a

 

 

10300HB4951sam002- 22 -LRB103 38094 HLH 74177 a

1        qualified tuition program has made reasonable efforts
2        if it makes disclosures (which may use the term
3        "in-state program" or "in-state plan" and need not
4        specifically refer to Illinois or its qualified
5        programs by name) (i) directly to prospective
6        participants in its offering materials or makes a
7        public disclosure, such as a website posting; and (ii)
8        where applicable, to intermediaries selling the
9        out-of-state program in the same manner that the
10        out-of-state program distributes its offering
11        materials;
12            (D-20.5) For taxable years beginning on or after
13        January 1, 2018, in the case of a distribution from a
14        qualified ABLE program under Section 529A of the
15        Internal Revenue Code, other than a distribution from
16        a qualified ABLE program created under Section 16.6 of
17        the State Treasurer Act, an amount equal to the amount
18        excluded from gross income under Section 529A(c)(1)(B)
19        of the Internal Revenue Code;
20            (D-21) For taxable years beginning on or after
21        January 1, 2007, in the case of transfer of moneys from
22        a qualified tuition program under Section 529 of the
23        Internal Revenue Code that is administered by the
24        State to an out-of-state program, an amount equal to
25        the amount of moneys previously deducted from base
26        income under subsection (a)(2)(Y) of this Section;

 

 

10300HB4951sam002- 23 -LRB103 38094 HLH 74177 a

1            (D-21.5) For taxable years beginning on or after
2        January 1, 2018, in the case of the transfer of moneys
3        from a qualified tuition program under Section 529 or
4        a qualified ABLE program under Section 529A of the
5        Internal Revenue Code that is administered by this
6        State to an ABLE account established under an
7        out-of-state ABLE account program, an amount equal to
8        the contribution component of the transferred amount
9        that was previously deducted from base income under
10        subsection (a)(2)(Y) or subsection (a)(2)(HH) of this
11        Section;
12            (D-22) For taxable years beginning on or after
13        January 1, 2009, and prior to January 1, 2018, in the
14        case of a nonqualified withdrawal or refund of moneys
15        from a qualified tuition program under Section 529 of
16        the Internal Revenue Code administered by the State
17        that is not used for qualified expenses at an eligible
18        education institution, an amount equal to the
19        contribution component of the nonqualified withdrawal
20        or refund that was previously deducted from base
21        income under subsection (a)(2)(y) of this Section,
22        provided that the withdrawal or refund did not result
23        from the beneficiary's death or disability. For
24        taxable years beginning on or after January 1, 2018:
25        (1) in the case of a nonqualified withdrawal or
26        refund, as defined under Section 16.5 of the State

 

 

10300HB4951sam002- 24 -LRB103 38094 HLH 74177 a

1        Treasurer Act, of moneys from a qualified tuition
2        program under Section 529 of the Internal Revenue Code
3        administered by the State, an amount equal to the
4        contribution component of the nonqualified withdrawal
5        or refund that was previously deducted from base
6        income under subsection (a)(2)(Y) of this Section, and
7        (2) in the case of a nonqualified withdrawal or refund
8        from a qualified ABLE program under Section 529A of
9        the Internal Revenue Code administered by the State
10        that is not used for qualified disability expenses, an
11        amount equal to the contribution component of the
12        nonqualified withdrawal or refund that was previously
13        deducted from base income under subsection (a)(2)(HH)
14        of this Section;
15            (D-23) An amount equal to the credit allowable to
16        the taxpayer under Section 218(a) of this Act,
17        determined without regard to Section 218(c) of this
18        Act;
19            (D-24) For taxable years ending on or after
20        December 31, 2017, an amount equal to the deduction
21        allowed under Section 199 of the Internal Revenue Code
22        for the taxable year;
23            (D-25) In the case of a resident, an amount equal
24        to the amount of tax for which a credit is allowed
25        pursuant to Section 201(p)(7) of this Act;
26    and by deducting from the total so obtained the sum of the

 

 

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1    following amounts:
2            (E) For taxable years ending before December 31,
3        2001, any amount included in such total in respect of
4        any compensation (including but not limited to any
5        compensation paid or accrued to a serviceman while a
6        prisoner of war or missing in action) paid to a
7        resident by reason of being on active duty in the Armed
8        Forces of the United States and in respect of any
9        compensation paid or accrued to a resident who as a
10        governmental employee was a prisoner of war or missing
11        in action, and in respect of any compensation paid to a
12        resident in 1971 or thereafter for annual training
13        performed pursuant to Sections 502 and 503, Title 32,
14        United States Code as a member of the Illinois
15        National Guard or, beginning with taxable years ending
16        on or after December 31, 2007, the National Guard of
17        any other state. For taxable years ending on or after
18        December 31, 2001, any amount included in such total
19        in respect of any compensation (including but not
20        limited to any compensation paid or accrued to a
21        serviceman while a prisoner of war or missing in
22        action) paid to a resident by reason of being a member
23        of any component of the Armed Forces of the United
24        States and in respect of any compensation paid or
25        accrued to a resident who as a governmental employee
26        was a prisoner of war or missing in action, and in

 

 

10300HB4951sam002- 26 -LRB103 38094 HLH 74177 a

1        respect of any compensation paid to a resident in 2001
2        or thereafter by reason of being a member of the
3        Illinois National Guard or, beginning with taxable
4        years ending on or after December 31, 2007, the
5        National Guard of any other state. The provisions of
6        this subparagraph (E) are exempt from the provisions
7        of Section 250;
8            (F) An amount equal to all amounts included in
9        such total pursuant to the provisions of Sections
10        402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and
11        408 of the Internal Revenue Code, or included in such
12        total as distributions under the provisions of any
13        retirement or disability plan for employees of any
14        governmental agency or unit, or retirement payments to
15        retired partners, which payments are excluded in
16        computing net earnings from self employment by Section
17        1402 of the Internal Revenue Code and regulations
18        adopted pursuant thereto;
19            (G) The valuation limitation amount;
20            (H) An amount equal to the amount of any tax
21        imposed by this Act which was refunded to the taxpayer
22        and included in such total for the taxable year;
23            (I) An amount equal to all amounts included in
24        such total pursuant to the provisions of Section 111
25        of the Internal Revenue Code as a recovery of items
26        previously deducted from adjusted gross income in the

 

 

10300HB4951sam002- 27 -LRB103 38094 HLH 74177 a

1        computation of taxable income;
2            (J) An amount equal to those dividends included in
3        such total which were paid by a corporation which
4        conducts business operations in a River Edge
5        Redevelopment Zone or zones created under the River
6        Edge Redevelopment Zone Act, and conducts
7        substantially all of its operations in a River Edge
8        Redevelopment Zone or zones. This subparagraph (J) is
9        exempt from the provisions of Section 250;
10            (K) An amount equal to those dividends included in
11        such total that were paid by a corporation that
12        conducts business operations in a federally designated
13        Foreign Trade Zone or Sub-Zone and that is designated
14        a High Impact Business located in Illinois; provided
15        that dividends eligible for the deduction provided in
16        subparagraph (J) of paragraph (2) of this subsection
17        shall not be eligible for the deduction provided under
18        this subparagraph (K);
19            (L) For taxable years ending after December 31,
20        1983, an amount equal to all social security benefits
21        and railroad retirement benefits included in such
22        total pursuant to Sections 72(r) and 86 of the
23        Internal Revenue Code;
24            (M) With the exception of any amounts subtracted
25        under subparagraph (N), an amount equal to the sum of
26        all amounts disallowed as deductions by (i) Sections

 

 

10300HB4951sam002- 28 -LRB103 38094 HLH 74177 a

1        171(a)(2) and 265(a)(2) of the Internal Revenue Code,
2        and all amounts of expenses allocable to interest and
3        disallowed as deductions by Section 265(a)(1) of the
4        Internal Revenue Code; and (ii) for taxable years
5        ending on or after August 13, 1999, Sections
6        171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
7        Internal Revenue Code, plus, for taxable years ending
8        on or after December 31, 2011, Section 45G(e)(3) of
9        the Internal Revenue Code and, for taxable years
10        ending on or after December 31, 2008, any amount
11        included in gross income under Section 87 of the
12        Internal Revenue Code; the provisions of this
13        subparagraph are exempt from the provisions of Section
14        250;
15            (N) An amount equal to all amounts included in
16        such total which are exempt from taxation by this
17        State either by reason of its statutes or Constitution
18        or by reason of the Constitution, treaties or statutes
19        of the United States; provided that, in the case of any
20        statute of this State that exempts income derived from
21        bonds or other obligations from the tax imposed under
22        this Act, the amount exempted shall be the interest
23        net of bond premium amortization;
24            (O) An amount equal to any contribution made to a
25        job training project established pursuant to the Tax
26        Increment Allocation Redevelopment Act;

 

 

10300HB4951sam002- 29 -LRB103 38094 HLH 74177 a

1            (P) An amount equal to the amount of the deduction
2        used to compute the federal income tax credit for
3        restoration of substantial amounts held under claim of
4        right for the taxable year pursuant to Section 1341 of
5        the Internal Revenue Code or of any itemized deduction
6        taken from adjusted gross income in the computation of
7        taxable income for restoration of substantial amounts
8        held under claim of right for the taxable year;
9            (Q) An amount equal to any amounts included in
10        such total, received by the taxpayer as an
11        acceleration in the payment of life, endowment or
12        annuity benefits in advance of the time they would
13        otherwise be payable as an indemnity for a terminal
14        illness;
15            (R) An amount equal to the amount of any federal or
16        State bonus paid to veterans of the Persian Gulf War;
17            (S) An amount, to the extent included in adjusted
18        gross income, equal to the amount of a contribution
19        made in the taxable year on behalf of the taxpayer to a
20        medical care savings account established under the
21        Medical Care Savings Account Act or the Medical Care
22        Savings Account Act of 2000 to the extent the
23        contribution is accepted by the account administrator
24        as provided in that Act;
25            (T) An amount, to the extent included in adjusted
26        gross income, equal to the amount of interest earned

 

 

10300HB4951sam002- 30 -LRB103 38094 HLH 74177 a

1        in the taxable year on a medical care savings account
2        established under the Medical Care Savings Account Act
3        or the Medical Care Savings Account Act of 2000 on
4        behalf of the taxpayer, other than interest added
5        pursuant to item (D-5) of this paragraph (2);
6            (U) For one taxable year beginning on or after
7        January 1, 1994, an amount equal to the total amount of
8        tax imposed and paid under subsections (a) and (b) of
9        Section 201 of this Act on grant amounts received by
10        the taxpayer under the Nursing Home Grant Assistance
11        Act during the taxpayer's taxable years 1992 and 1993;
12            (V) Beginning with tax years ending on or after
13        December 31, 1995 and ending with tax years ending on
14        or before December 31, 2004, an amount equal to the
15        amount paid by a taxpayer who is a self-employed
16        taxpayer, a partner of a partnership, or a shareholder
17        in a Subchapter S corporation for health insurance or
18        long-term care insurance for that taxpayer or that
19        taxpayer's spouse or dependents, to the extent that
20        the amount paid for that health insurance or long-term
21        care insurance may be deducted under Section 213 of
22        the Internal Revenue Code, has not been deducted on
23        the federal income tax return of the taxpayer, and
24        does not exceed the taxable income attributable to
25        that taxpayer's income, self-employment income, or
26        Subchapter S corporation income; except that no

 

 

10300HB4951sam002- 31 -LRB103 38094 HLH 74177 a

1        deduction shall be allowed under this item (V) if the
2        taxpayer is eligible to participate in any health
3        insurance or long-term care insurance plan of an
4        employer of the taxpayer or the taxpayer's spouse. The
5        amount of the health insurance and long-term care
6        insurance subtracted under this item (V) shall be
7        determined by multiplying total health insurance and
8        long-term care insurance premiums paid by the taxpayer
9        times a number that represents the fractional
10        percentage of eligible medical expenses under Section
11        213 of the Internal Revenue Code of 1986 not actually
12        deducted on the taxpayer's federal income tax return;
13            (W) For taxable years beginning on or after
14        January 1, 1998, all amounts included in the
15        taxpayer's federal gross income in the taxable year
16        from amounts converted from a regular IRA to a Roth
17        IRA. This paragraph is exempt from the provisions of
18        Section 250;
19            (X) For taxable year 1999 and thereafter, an
20        amount equal to the amount of any (i) distributions,
21        to the extent includible in gross income for federal
22        income tax purposes, made to the taxpayer because of
23        his or her status as a victim of persecution for racial
24        or religious reasons by Nazi Germany or any other Axis
25        regime or as an heir of the victim and (ii) items of
26        income, to the extent includible in gross income for

 

 

10300HB4951sam002- 32 -LRB103 38094 HLH 74177 a

1        federal income tax purposes, attributable to, derived
2        from or in any way related to assets stolen from,
3        hidden from, or otherwise lost to a victim of
4        persecution for racial or religious reasons by Nazi
5        Germany or any other Axis regime immediately prior to,
6        during, and immediately after World War II, including,
7        but not limited to, interest on the proceeds
8        receivable as insurance under policies issued to a
9        victim of persecution for racial or religious reasons
10        by Nazi Germany or any other Axis regime by European
11        insurance companies immediately prior to and during
12        World War II; provided, however, this subtraction from
13        federal adjusted gross income does not apply to assets
14        acquired with such assets or with the proceeds from
15        the sale of such assets; provided, further, this
16        paragraph shall only apply to a taxpayer who was the
17        first recipient of such assets after their recovery
18        and who is a victim of persecution for racial or
19        religious reasons by Nazi Germany or any other Axis
20        regime or as an heir of the victim. The amount of and
21        the eligibility for any public assistance, benefit, or
22        similar entitlement is not affected by the inclusion
23        of items (i) and (ii) of this paragraph in gross income
24        for federal income tax purposes. This paragraph is
25        exempt from the provisions of Section 250;
26            (Y) For taxable years beginning on or after

 

 

10300HB4951sam002- 33 -LRB103 38094 HLH 74177 a

1        January 1, 2002 and ending on or before December 31,
2        2004, moneys contributed in the taxable year to a
3        College Savings Pool account under Section 16.5 of the
4        State Treasurer Act, except that amounts excluded from
5        gross income under Section 529(c)(3)(C)(i) of the
6        Internal Revenue Code shall not be considered moneys
7        contributed under this subparagraph (Y). For taxable
8        years beginning on or after January 1, 2005, a maximum
9        of $10,000 contributed in the taxable year to (i) a
10        College Savings Pool account under Section 16.5 of the
11        State Treasurer Act or (ii) the Illinois Prepaid
12        Tuition Trust Fund, except that amounts excluded from
13        gross income under Section 529(c)(3)(C)(i) of the
14        Internal Revenue Code shall not be considered moneys
15        contributed under this subparagraph (Y). For purposes
16        of this subparagraph, contributions made by an
17        employer on behalf of an employee, or matching
18        contributions made by an employee, shall be treated as
19        made by the employee. This subparagraph (Y) is exempt
20        from the provisions of Section 250;
21            (Z) For taxable years 2001 and thereafter, for the
22        taxable year in which the bonus depreciation deduction
23        is taken on the taxpayer's federal income tax return
24        under subsection (k) of Section 168 of the Internal
25        Revenue Code and for each applicable taxable year
26        thereafter, an amount equal to "x", where:

 

 

10300HB4951sam002- 34 -LRB103 38094 HLH 74177 a

1                (1) "y" equals the amount of the depreciation
2            deduction taken for the taxable year on the
3            taxpayer's federal income tax return on property
4            for which the bonus depreciation deduction was
5            taken in any year under subsection (k) of Section
6            168 of the Internal Revenue Code, but not
7            including the bonus depreciation deduction;
8                (2) for taxable years ending on or before
9            December 31, 2005, "x" equals "y" multiplied by 30
10            and then divided by 70 (or "y" multiplied by
11            0.429); and
12                (3) for taxable years ending after December
13            31, 2005:
14                    (i) for property on which a bonus
15                depreciation deduction of 30% of the adjusted
16                basis was taken, "x" equals "y" multiplied by
17                30 and then divided by 70 (or "y" multiplied
18                by 0.429);
19                    (ii) for property on which a bonus
20                depreciation deduction of 50% of the adjusted
21                basis was taken, "x" equals "y" multiplied by
22                1.0;
23                    (iii) for property on which a bonus
24                depreciation deduction of 100% of the adjusted
25                basis was taken in a taxable year ending on or
26                after December 31, 2021, "x" equals the

 

 

10300HB4951sam002- 35 -LRB103 38094 HLH 74177 a

1                depreciation deduction that would be allowed
2                on that property if the taxpayer had made the
3                election under Section 168(k)(7) of the
4                Internal Revenue Code to not claim bonus
5                depreciation on that property; and
6                    (iv) for property on which a bonus
7                depreciation deduction of a percentage other
8                than 30%, 50% or 100% of the adjusted basis
9                was taken in a taxable year ending on or after
10                December 31, 2021, "x" equals "y" multiplied
11                by 100 times the percentage bonus depreciation
12                on the property (that is, 100(bonus%)) and
13                then divided by 100 times 1 minus the
14                percentage bonus depreciation on the property
15                (that is, 100(1-bonus%)).
16            The aggregate amount deducted under this
17        subparagraph in all taxable years for any one piece of
18        property may not exceed the amount of the bonus
19        depreciation deduction taken on that property on the
20        taxpayer's federal income tax return under subsection
21        (k) of Section 168 of the Internal Revenue Code. This
22        subparagraph (Z) is exempt from the provisions of
23        Section 250;
24            (AA) If the taxpayer sells, transfers, abandons,
25        or otherwise disposes of property for which the
26        taxpayer was required in any taxable year to make an

 

 

10300HB4951sam002- 36 -LRB103 38094 HLH 74177 a

1        addition modification under subparagraph (D-15), then
2        an amount equal to that addition modification.
3            If the taxpayer continues to own property through
4        the last day of the last tax year for which a
5        subtraction is allowed with respect to that property
6        under subparagraph (Z) and for which the taxpayer was
7        required in any taxable year to make an addition
8        modification under subparagraph (D-15), then an amount
9        equal to that addition modification.
10            The taxpayer is allowed to take the deduction
11        under this subparagraph only once with respect to any
12        one piece of property.
13            This subparagraph (AA) is exempt from the
14        provisions of Section 250;
15            (BB) Any amount included in adjusted gross income,
16        other than salary, received by a driver in a
17        ridesharing arrangement using a motor vehicle;
18            (CC) The amount of (i) any interest income (net of
19        the deductions allocable thereto) taken into account
20        for the taxable year with respect to a transaction
21        with a taxpayer that is required to make an addition
22        modification with respect to such transaction under
23        Section 203(a)(2)(D-17), 203(b)(2)(E-12),
24        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
25        the amount of that addition modification, and (ii) any
26        income from intangible property (net of the deductions

 

 

10300HB4951sam002- 37 -LRB103 38094 HLH 74177 a

1        allocable thereto) taken into account for the taxable
2        year with respect to a transaction with a taxpayer
3        that is required to make an addition modification with
4        respect to such transaction under Section
5        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
6        203(d)(2)(D-8), but not to exceed the amount of that
7        addition modification. This subparagraph (CC) is
8        exempt from the provisions of Section 250;
9            (DD) An amount equal to the interest income taken
10        into account for the taxable year (net of the
11        deductions allocable thereto) with respect to
12        transactions with (i) a foreign person who would be a
13        member of the taxpayer's unitary business group but
14        for the fact that the foreign person's business
15        activity outside the United States is 80% or more of
16        that person's total business activity and (ii) for
17        taxable years ending on or after December 31, 2008, to
18        a person who would be a member of the same unitary
19        business group but for the fact that the person is
20        prohibited under Section 1501(a)(27) from being
21        included in the unitary business group because he or
22        she is ordinarily required to apportion business
23        income under different subsections of Section 304, but
24        not to exceed the addition modification required to be
25        made for the same taxable year under Section
26        203(a)(2)(D-17) for interest paid, accrued, or

 

 

10300HB4951sam002- 38 -LRB103 38094 HLH 74177 a

1        incurred, directly or indirectly, to the same person.
2        This subparagraph (DD) is exempt from the provisions
3        of Section 250;
4            (EE) An amount equal to the income from intangible
5        property taken into account for the taxable year (net
6        of the deductions allocable thereto) with respect to
7        transactions with (i) a foreign person who would be a
8        member of the taxpayer's unitary business group but
9        for the fact that the foreign person's business
10        activity outside the United States is 80% or more of
11        that person's total business activity and (ii) for
12        taxable years ending on or after December 31, 2008, to
13        a person who would be a member of the same unitary
14        business group but for the fact that the person is
15        prohibited under Section 1501(a)(27) from being
16        included in the unitary business group because he or
17        she is ordinarily required to apportion business
18        income under different subsections of Section 304, but
19        not to exceed the addition modification required to be
20        made for the same taxable year under Section
21        203(a)(2)(D-18) for intangible expenses and costs
22        paid, accrued, or incurred, directly or indirectly, to
23        the same foreign person. This subparagraph (EE) is
24        exempt from the provisions of Section 250;
25            (FF) An amount equal to any amount awarded to the
26        taxpayer during the taxable year by the Court of

 

 

10300HB4951sam002- 39 -LRB103 38094 HLH 74177 a

1        Claims under subsection (c) of Section 8 of the Court
2        of Claims Act for time unjustly served in a State
3        prison. This subparagraph (FF) is exempt from the
4        provisions of Section 250;
5            (GG) For taxable years ending on or after December
6        31, 2011, in the case of a taxpayer who was required to
7        add back any insurance premiums under Section
8        203(a)(2)(D-19), such taxpayer may elect to subtract
9        that part of a reimbursement received from the
10        insurance company equal to the amount of the expense
11        or loss (including expenses incurred by the insurance
12        company) that would have been taken into account as a
13        deduction for federal income tax purposes if the
14        expense or loss had been uninsured. If a taxpayer
15        makes the election provided for by this subparagraph
16        (GG), the insurer to which the premiums were paid must
17        add back to income the amount subtracted by the
18        taxpayer pursuant to this subparagraph (GG). This
19        subparagraph (GG) is exempt from the provisions of
20        Section 250;
21            (HH) For taxable years beginning on or after
22        January 1, 2018 and prior to January 1, 2028, a maximum
23        of $10,000 contributed in the taxable year to a
24        qualified ABLE account under Section 16.6 of the State
25        Treasurer Act, except that amounts excluded from gross
26        income under Section 529(c)(3)(C)(i) or Section

 

 

10300HB4951sam002- 40 -LRB103 38094 HLH 74177 a

1        529A(c)(1)(C) of the Internal Revenue Code shall not
2        be considered moneys contributed under this
3        subparagraph (HH). For purposes of this subparagraph
4        (HH), contributions made by an employer on behalf of
5        an employee, or matching contributions made by an
6        employee, shall be treated as made by the employee;
7            (II) For taxable years that begin on or after
8        January 1, 2021 and begin before January 1, 2026, the
9        amount that is included in the taxpayer's federal
10        adjusted gross income pursuant to Section 61 of the
11        Internal Revenue Code as discharge of indebtedness
12        attributable to student loan forgiveness and that is
13        not excluded from the taxpayer's federal adjusted
14        gross income pursuant to paragraph (5) of subsection
15        (f) of Section 108 of the Internal Revenue Code; and
16            (JJ) For taxable years beginning on or after
17        January 1, 2023, for any cannabis establishment
18        operating in this State and licensed under the
19        Cannabis Regulation and Tax Act or any cannabis
20        cultivation center or medical cannabis dispensing
21        organization operating in this State and licensed
22        under the Compassionate Use of Medical Cannabis
23        Program Act, an amount equal to the deductions that
24        were disallowed under Section 280E of the Internal
25        Revenue Code for the taxable year and that would not be
26        added back under this subsection. The provisions of

 

 

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1        this subparagraph (JJ) are exempt from the provisions
2        of Section 250; .
3            (KK) (JJ) To the extent includible in gross income
4        for federal income tax purposes, any amount awarded or
5        paid to the taxpayer as a result of a judgment or
6        settlement for fertility fraud as provided in Section
7        15 of the Illinois Fertility Fraud Act, donor
8        fertility fraud as provided in Section 20 of the
9        Illinois Fertility Fraud Act, or similar action in
10        another state; and .
11            (LL) For taxable years beginning on or after
12        January 1, 2026, if the taxpayer is a qualified
13        worker, as defined in the Workforce Development
14        through Charitable Loan Repayment Act, an amount equal
15        to the amount included in the taxpayer's federal
16        adjusted gross income that is attributable to student
17        loan repayment assistance received by the taxpayer
18        during the taxable year from a qualified community
19        foundation under the provisions of the Workforce
20        Development Through Charitable Loan Repayment Act.
21            This subparagraph (LL) is exempt from the
22        provisions of Section 250.
 
23    (b) Corporations.
24        (1) In general. In the case of a corporation, base
25    income means an amount equal to the taxpayer's taxable

 

 

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1    income for the taxable year as modified by paragraph (2).
2        (2) Modifications. The taxable income referred to in
3    paragraph (1) shall be modified by adding thereto the sum
4    of the following amounts:
5            (A) An amount equal to all amounts paid or accrued
6        to the taxpayer as interest and all distributions
7        received from regulated investment companies during
8        the taxable year to the extent excluded from gross
9        income in the computation of taxable income;
10            (B) An amount equal to the amount of tax imposed by
11        this Act to the extent deducted from gross income in
12        the computation of taxable income for the taxable
13        year;
14            (C) In the case of a regulated investment company,
15        an amount equal to the excess of (i) the net long-term
16        capital gain for the taxable year, over (ii) the
17        amount of the capital gain dividends designated as
18        such in accordance with Section 852(b)(3)(C) of the
19        Internal Revenue Code and any amount designated under
20        Section 852(b)(3)(D) of the Internal Revenue Code,
21        attributable to the taxable year (this amendatory Act
22        of 1995 (Public Act 89-89) is declarative of existing
23        law and is not a new enactment);
24            (D) The amount of any net operating loss deduction
25        taken in arriving at taxable income, other than a net
26        operating loss carried forward from a taxable year

 

 

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1        ending prior to December 31, 1986;
2            (E) For taxable years in which a net operating
3        loss carryback or carryforward from a taxable year
4        ending prior to December 31, 1986 is an element of
5        taxable income under paragraph (1) of subsection (e)
6        or subparagraph (E) of paragraph (2) of subsection
7        (e), the amount by which addition modifications other
8        than those provided by this subparagraph (E) exceeded
9        subtraction modifications in such earlier taxable
10        year, with the following limitations applied in the
11        order that they are listed:
12                (i) the addition modification relating to the
13            net operating loss carried back or forward to the
14            taxable year from any taxable year ending prior to
15            December 31, 1986 shall be reduced by the amount
16            of addition modification under this subparagraph
17            (E) which related to that net operating loss and
18            which was taken into account in calculating the
19            base income of an earlier taxable year, and
20                (ii) the addition modification relating to the
21            net operating loss carried back or forward to the
22            taxable year from any taxable year ending prior to
23            December 31, 1986 shall not exceed the amount of
24            such carryback or carryforward;
25            For taxable years in which there is a net
26        operating loss carryback or carryforward from more

 

 

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1        than one other taxable year ending prior to December
2        31, 1986, the addition modification provided in this
3        subparagraph (E) shall be the sum of the amounts
4        computed independently under the preceding provisions
5        of this subparagraph (E) for each such taxable year;
6            (E-5) For taxable years ending after December 31,
7        1997, an amount equal to any eligible remediation
8        costs that the corporation deducted in computing
9        adjusted gross income and for which the corporation
10        claims a credit under subsection (l) of Section 201;
11            (E-10) For taxable years 2001 and thereafter, an
12        amount equal to the bonus depreciation deduction taken
13        on the taxpayer's federal income tax return for the
14        taxable year under subsection (k) of Section 168 of
15        the Internal Revenue Code;
16            (E-11) If the taxpayer sells, transfers, abandons,
17        or otherwise disposes of property for which the
18        taxpayer was required in any taxable year to make an
19        addition modification under subparagraph (E-10), then
20        an amount equal to the aggregate amount of the
21        deductions taken in all taxable years under
22        subparagraph (T) with respect to that property.
23            If the taxpayer continues to own property through
24        the last day of the last tax year for which a
25        subtraction is allowed with respect to that property
26        under subparagraph (T) and for which the taxpayer was

 

 

10300HB4951sam002- 45 -LRB103 38094 HLH 74177 a

1        allowed in any taxable year to make a subtraction
2        modification under subparagraph (T), then an amount
3        equal to that subtraction modification.
4            The taxpayer is required to make the addition
5        modification under this subparagraph only once with
6        respect to any one piece of property;
7            (E-12) An amount equal to the amount otherwise
8        allowed as a deduction in computing base income for
9        interest paid, accrued, or incurred, directly or
10        indirectly, (i) for taxable years ending on or after
11        December 31, 2004, to a foreign person who would be a
12        member of the same unitary business group but for the
13        fact the foreign person's business activity outside
14        the United States is 80% or more of the foreign
15        person's total business activity and (ii) for taxable
16        years ending on or after December 31, 2008, to a person
17        who would be a member of the same unitary business
18        group but for the fact that the person is prohibited
19        under Section 1501(a)(27) from being included in the
20        unitary business group because he or she is ordinarily
21        required to apportion business income under different
22        subsections of Section 304. The addition modification
23        required by this subparagraph shall be reduced to the
24        extent that dividends were included in base income of
25        the unitary group for the same taxable year and
26        received by the taxpayer or by a member of the

 

 

10300HB4951sam002- 46 -LRB103 38094 HLH 74177 a

1        taxpayer's unitary business group (including amounts
2        included in gross income pursuant to Sections 951
3        through 964 of the Internal Revenue Code and amounts
4        included in gross income under Section 78 of the
5        Internal Revenue Code) with respect to the stock of
6        the same person to whom the interest was paid,
7        accrued, or incurred.
8            This paragraph shall not apply to the following:
9                (i) an item of interest paid, accrued, or
10            incurred, directly or indirectly, to a person who
11            is subject in a foreign country or state, other
12            than a state which requires mandatory unitary
13            reporting, to a tax on or measured by net income
14            with respect to such interest; or
15                (ii) an item of interest paid, accrued, or
16            incurred, directly or indirectly, to a person if
17            the taxpayer can establish, based on a
18            preponderance of the evidence, both of the
19            following:
20                    (a) the person, during the same taxable
21                year, paid, accrued, or incurred, the interest
22                to a person that is not a related member, and
23                    (b) the transaction giving rise to the
24                interest expense between the taxpayer and the
25                person did not have as a principal purpose the
26                avoidance of Illinois income tax, and is paid

 

 

10300HB4951sam002- 47 -LRB103 38094 HLH 74177 a

1                pursuant to a contract or agreement that
2                reflects an arm's-length interest rate and
3                terms; or
4                (iii) the taxpayer can establish, based on
5            clear and convincing evidence, that the interest
6            paid, accrued, or incurred relates to a contract
7            or agreement entered into at arm's-length rates
8            and terms and the principal purpose for the
9            payment is not federal or Illinois tax avoidance;
10            or
11                (iv) an item of interest paid, accrued, or
12            incurred, directly or indirectly, to a person if
13            the taxpayer establishes by clear and convincing
14            evidence that the adjustments are unreasonable; or
15            if the taxpayer and the Director agree in writing
16            to the application or use of an alternative method
17            of apportionment under Section 304(f).
18                Nothing in this subsection shall preclude the
19            Director from making any other adjustment
20            otherwise allowed under Section 404 of this Act
21            for any tax year beginning after the effective
22            date of this amendment provided such adjustment is
23            made pursuant to regulation adopted by the
24            Department and such regulations provide methods
25            and standards by which the Department will utilize
26            its authority under Section 404 of this Act;

 

 

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1            (E-13) An amount equal to the amount of intangible
2        expenses and costs otherwise allowed as a deduction in
3        computing base income, and that were paid, accrued, or
4        incurred, directly or indirectly, (i) for taxable
5        years ending on or after December 31, 2004, to a
6        foreign person who would be a member of the same
7        unitary business group but for the fact that the
8        foreign person's business activity outside the United
9        States is 80% or more of that person's total business
10        activity and (ii) for taxable years ending on or after
11        December 31, 2008, to a person who would be a member of
12        the same unitary business group but for the fact that
13        the person is prohibited under Section 1501(a)(27)
14        from being included in the unitary business group
15        because he or she is ordinarily required to apportion
16        business income under different subsections of Section
17        304. The addition modification required by this
18        subparagraph shall be reduced to the extent that
19        dividends were included in base income of the unitary
20        group for the same taxable year and received by the
21        taxpayer or by a member of the taxpayer's unitary
22        business group (including amounts included in gross
23        income pursuant to Sections 951 through 964 of the
24        Internal Revenue Code and amounts included in gross
25        income under Section 78 of the Internal Revenue Code)
26        with respect to the stock of the same person to whom

 

 

10300HB4951sam002- 49 -LRB103 38094 HLH 74177 a

1        the intangible expenses and costs were directly or
2        indirectly paid, incurred, or accrued. The preceding
3        sentence shall not apply to the extent that the same
4        dividends caused a reduction to the addition
5        modification required under Section 203(b)(2)(E-12) of
6        this Act. As used in this subparagraph, the term
7        "intangible expenses and costs" includes (1) expenses,
8        losses, and costs for, or related to, the direct or
9        indirect acquisition, use, maintenance or management,
10        ownership, sale, exchange, or any other disposition of
11        intangible property; (2) losses incurred, directly or
12        indirectly, from factoring transactions or discounting
13        transactions; (3) royalty, patent, technical, and
14        copyright fees; (4) licensing fees; and (5) other
15        similar expenses and costs. For purposes of this
16        subparagraph, "intangible property" includes patents,
17        patent applications, trade names, trademarks, service
18        marks, copyrights, mask works, trade secrets, and
19        similar types of intangible assets.
20            This paragraph shall not apply to the following:
21                (i) any item of intangible expenses or costs
22            paid, accrued, or incurred, directly or
23            indirectly, from a transaction with a person who
24            is subject in a foreign country or state, other
25            than a state which requires mandatory unitary
26            reporting, to a tax on or measured by net income

 

 

10300HB4951sam002- 50 -LRB103 38094 HLH 74177 a

1            with respect to such item; or
2                (ii) any item of intangible expense or cost
3            paid, accrued, or incurred, directly or
4            indirectly, if the taxpayer can establish, based
5            on a preponderance of the evidence, both of the
6            following:
7                    (a) the person during the same taxable
8                year paid, accrued, or incurred, the
9                intangible expense or cost to a person that is
10                not a related member, and
11                    (b) the transaction giving rise to the
12                intangible expense or cost between the
13                taxpayer and the person did not have as a
14                principal purpose the avoidance of Illinois
15                income tax, and is paid pursuant to a contract
16                or agreement that reflects arm's-length terms;
17                or
18                (iii) any item of intangible expense or cost
19            paid, accrued, or incurred, directly or
20            indirectly, from a transaction with a person if
21            the taxpayer establishes by clear and convincing
22            evidence, that the adjustments are unreasonable;
23            or if the taxpayer and the Director agree in
24            writing to the application or use of an
25            alternative method of apportionment under Section
26            304(f);

 

 

10300HB4951sam002- 51 -LRB103 38094 HLH 74177 a

1                Nothing in this subsection shall preclude the
2            Director from making any other adjustment
3            otherwise allowed under Section 404 of this Act
4            for any tax year beginning after the effective
5            date of this amendment provided such adjustment is
6            made pursuant to regulation adopted by the
7            Department and such regulations provide methods
8            and standards by which the Department will utilize
9            its authority under Section 404 of this Act;
10            (E-14) For taxable years ending on or after
11        December 31, 2008, an amount equal to the amount of
12        insurance premium expenses and costs otherwise allowed
13        as a deduction in computing base income, and that were
14        paid, accrued, or incurred, directly or indirectly, to
15        a person who would be a member of the same unitary
16        business group but for the fact that the person is
17        prohibited under Section 1501(a)(27) from being
18        included in the unitary business group because he or
19        she is ordinarily required to apportion business
20        income under different subsections of Section 304. The
21        addition modification required by this subparagraph
22        shall be reduced to the extent that dividends were
23        included in base income of the unitary group for the
24        same taxable year and received by the taxpayer or by a
25        member of the taxpayer's unitary business group
26        (including amounts included in gross income under

 

 

10300HB4951sam002- 52 -LRB103 38094 HLH 74177 a

1        Sections 951 through 964 of the Internal Revenue Code
2        and amounts included in gross income under Section 78
3        of the Internal Revenue Code) with respect to the
4        stock of the same person to whom the premiums and costs
5        were directly or indirectly paid, incurred, or
6        accrued. The preceding sentence does not apply to the
7        extent that the same dividends caused a reduction to
8        the addition modification required under Section
9        203(b)(2)(E-12) or Section 203(b)(2)(E-13) of this
10        Act;
11            (E-15) For taxable years beginning after December
12        31, 2008, any deduction for dividends paid by a
13        captive real estate investment trust that is allowed
14        to a real estate investment trust under Section
15        857(b)(2)(B) of the Internal Revenue Code for
16        dividends paid;
17            (E-16) An amount equal to the credit allowable to
18        the taxpayer under Section 218(a) of this Act,
19        determined without regard to Section 218(c) of this
20        Act;
21            (E-17) For taxable years ending on or after
22        December 31, 2017, an amount equal to the deduction
23        allowed under Section 199 of the Internal Revenue Code
24        for the taxable year;
25            (E-18) for taxable years beginning after December
26        31, 2018, an amount equal to the deduction allowed

 

 

10300HB4951sam002- 53 -LRB103 38094 HLH 74177 a

1        under Section 250(a)(1)(A) of the Internal Revenue
2        Code for the taxable year;
3            (E-19) for taxable years ending on or after June
4        30, 2021, an amount equal to the deduction allowed
5        under Section 250(a)(1)(B)(i) of the Internal Revenue
6        Code for the taxable year;
7            (E-20) for taxable years ending on or after June
8        30, 2021, an amount equal to the deduction allowed
9        under Sections 243(e) and 245A(a) of the Internal
10        Revenue Code for the taxable year.
11    and by deducting from the total so obtained the sum of the
12    following amounts:
13            (F) An amount equal to the amount of any tax
14        imposed by this Act which was refunded to the taxpayer
15        and included in such total for the taxable year;
16            (G) An amount equal to any amount included in such
17        total under Section 78 of the Internal Revenue Code;
18            (H) In the case of a regulated investment company,
19        an amount equal to the amount of exempt interest
20        dividends as defined in subsection (b)(5) of Section
21        852 of the Internal Revenue Code, paid to shareholders
22        for the taxable year;
23            (I) With the exception of any amounts subtracted
24        under subparagraph (J), an amount equal to the sum of
25        all amounts disallowed as deductions by (i) Sections
26        171(a)(2) and 265(a)(2) and amounts disallowed as

 

 

10300HB4951sam002- 54 -LRB103 38094 HLH 74177 a

1        interest expense by Section 291(a)(3) of the Internal
2        Revenue Code, and all amounts of expenses allocable to
3        interest and disallowed as deductions by Section
4        265(a)(1) of the Internal Revenue Code; and (ii) for
5        taxable years ending on or after August 13, 1999,
6        Sections 171(a)(2), 265, 280C, 291(a)(3), and
7        832(b)(5)(B)(i) of the Internal Revenue Code, plus,
8        for tax years ending on or after December 31, 2011,
9        amounts disallowed as deductions by Section 45G(e)(3)
10        of the Internal Revenue Code and, for taxable years
11        ending on or after December 31, 2008, any amount
12        included in gross income under Section 87 of the
13        Internal Revenue Code and the policyholders' share of
14        tax-exempt interest of a life insurance company under
15        Section 807(a)(2)(B) of the Internal Revenue Code (in
16        the case of a life insurance company with gross income
17        from a decrease in reserves for the tax year) or
18        Section 807(b)(1)(B) of the Internal Revenue Code (in
19        the case of a life insurance company allowed a
20        deduction for an increase in reserves for the tax
21        year); the provisions of this subparagraph are exempt
22        from the provisions of Section 250;
23            (J) An amount equal to all amounts included in
24        such total which are exempt from taxation by this
25        State either by reason of its statutes or Constitution
26        or by reason of the Constitution, treaties or statutes

 

 

10300HB4951sam002- 55 -LRB103 38094 HLH 74177 a

1        of the United States; provided that, in the case of any
2        statute of this State that exempts income derived from
3        bonds or other obligations from the tax imposed under
4        this Act, the amount exempted shall be the interest
5        net of bond premium amortization;
6            (K) An amount equal to those dividends included in
7        such total which were paid by a corporation which
8        conducts business operations in a River Edge
9        Redevelopment Zone or zones created under the River
10        Edge Redevelopment Zone Act and conducts substantially
11        all of its operations in a River Edge Redevelopment
12        Zone or zones. This subparagraph (K) is exempt from
13        the provisions of Section 250;
14            (L) An amount equal to those dividends included in
15        such total that were paid by a corporation that
16        conducts business operations in a federally designated
17        Foreign Trade Zone or Sub-Zone and that is designated
18        a High Impact Business located in Illinois; provided
19        that dividends eligible for the deduction provided in
20        subparagraph (K) of paragraph 2 of this subsection
21        shall not be eligible for the deduction provided under
22        this subparagraph (L);
23            (M) For any taxpayer that is a financial
24        organization within the meaning of Section 304(c) of
25        this Act, an amount included in such total as interest
26        income from a loan or loans made by such taxpayer to a

 

 

10300HB4951sam002- 56 -LRB103 38094 HLH 74177 a

1        borrower, to the extent that such a loan is secured by
2        property which is eligible for the River Edge
3        Redevelopment Zone Investment Credit. To determine the
4        portion of a loan or loans that is secured by property
5        eligible for a Section 201(f) investment credit to the
6        borrower, the entire principal amount of the loan or
7        loans between the taxpayer and the borrower should be
8        divided into the basis of the Section 201(f)
9        investment credit property which secures the loan or
10        loans, using for this purpose the original basis of
11        such property on the date that it was placed in service
12        in the River Edge Redevelopment Zone. The subtraction
13        modification available to the taxpayer in any year
14        under this subsection shall be that portion of the
15        total interest paid by the borrower with respect to
16        such loan attributable to the eligible property as
17        calculated under the previous sentence. This
18        subparagraph (M) is exempt from the provisions of
19        Section 250;
20            (M-1) For any taxpayer that is a financial
21        organization within the meaning of Section 304(c) of
22        this Act, an amount included in such total as interest
23        income from a loan or loans made by such taxpayer to a
24        borrower, to the extent that such a loan is secured by
25        property which is eligible for the High Impact
26        Business Investment Credit. To determine the portion

 

 

10300HB4951sam002- 57 -LRB103 38094 HLH 74177 a

1        of a loan or loans that is secured by property eligible
2        for a Section 201(h) investment credit to the
3        borrower, the entire principal amount of the loan or
4        loans between the taxpayer and the borrower should be
5        divided into the basis of the Section 201(h)
6        investment credit property which secures the loan or
7        loans, using for this purpose the original basis of
8        such property on the date that it was placed in service
9        in a federally designated Foreign Trade Zone or
10        Sub-Zone located in Illinois. No taxpayer that is
11        eligible for the deduction provided in subparagraph
12        (M) of paragraph (2) of this subsection shall be
13        eligible for the deduction provided under this
14        subparagraph (M-1). The subtraction modification
15        available to taxpayers in any year under this
16        subsection shall be that portion of the total interest
17        paid by the borrower with respect to such loan
18        attributable to the eligible property as calculated
19        under the previous sentence;
20            (N) Two times any contribution made during the
21        taxable year to a designated zone organization to the
22        extent that the contribution (i) qualifies as a
23        charitable contribution under subsection (c) of
24        Section 170 of the Internal Revenue Code and (ii)
25        must, by its terms, be used for a project approved by
26        the Department of Commerce and Economic Opportunity

 

 

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1        under Section 11 of the Illinois Enterprise Zone Act
2        or under Section 10-10 of the River Edge Redevelopment
3        Zone Act. This subparagraph (N) is exempt from the
4        provisions of Section 250;
5            (O) An amount equal to: (i) 85% for taxable years
6        ending on or before December 31, 1992, or, a
7        percentage equal to the percentage allowable under
8        Section 243(a)(1) of the Internal Revenue Code of 1986
9        for taxable years ending after December 31, 1992, of
10        the amount by which dividends included in taxable
11        income and received from a corporation that is not
12        created or organized under the laws of the United
13        States or any state or political subdivision thereof,
14        including, for taxable years ending on or after
15        December 31, 1988, dividends received or deemed
16        received or paid or deemed paid under Sections 951
17        through 965 of the Internal Revenue Code, exceed the
18        amount of the modification provided under subparagraph
19        (G) of paragraph (2) of this subsection (b) which is
20        related to such dividends, and including, for taxable
21        years ending on or after December 31, 2008, dividends
22        received from a captive real estate investment trust;
23        plus (ii) 100% of the amount by which dividends,
24        included in taxable income and received, including,
25        for taxable years ending on or after December 31,
26        1988, dividends received or deemed received or paid or

 

 

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1        deemed paid under Sections 951 through 964 of the
2        Internal Revenue Code and including, for taxable years
3        ending on or after December 31, 2008, dividends
4        received from a captive real estate investment trust,
5        from any such corporation specified in clause (i) that
6        would but for the provisions of Section 1504(b)(3) of
7        the Internal Revenue Code be treated as a member of the
8        affiliated group which includes the dividend
9        recipient, exceed the amount of the modification
10        provided under subparagraph (G) of paragraph (2) of
11        this subsection (b) which is related to such
12        dividends. For taxable years ending on or after June
13        30, 2021, (i) for purposes of this subparagraph, the
14        term "dividend" does not include any amount treated as
15        a dividend under Section 1248 of the Internal Revenue
16        Code, and (ii) this subparagraph shall not apply to
17        dividends for which a deduction is allowed under
18        Section 245(a) of the Internal Revenue Code. This
19        subparagraph (O) is exempt from the provisions of
20        Section 250 of this Act;
21            (P) An amount equal to any contribution made to a
22        job training project established pursuant to the Tax
23        Increment Allocation Redevelopment Act;
24            (Q) An amount equal to the amount of the deduction
25        used to compute the federal income tax credit for
26        restoration of substantial amounts held under claim of

 

 

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1        right for the taxable year pursuant to Section 1341 of
2        the Internal Revenue Code;
3            (R) On and after July 20, 1999, in the case of an
4        attorney-in-fact with respect to whom an interinsurer
5        or a reciprocal insurer has made the election under
6        Section 835 of the Internal Revenue Code, 26 U.S.C.
7        835, an amount equal to the excess, if any, of the
8        amounts paid or incurred by that interinsurer or
9        reciprocal insurer in the taxable year to the
10        attorney-in-fact over the deduction allowed to that
11        interinsurer or reciprocal insurer with respect to the
12        attorney-in-fact under Section 835(b) of the Internal
13        Revenue Code for the taxable year; the provisions of
14        this subparagraph are exempt from the provisions of
15        Section 250;
16            (S) For taxable years ending on or after December
17        31, 1997, in the case of a Subchapter S corporation, an
18        amount equal to all amounts of income allocable to a
19        shareholder subject to the Personal Property Tax
20        Replacement Income Tax imposed by subsections (c) and
21        (d) of Section 201 of this Act, including amounts
22        allocable to organizations exempt from federal income
23        tax by reason of Section 501(a) of the Internal
24        Revenue Code. This subparagraph (S) is exempt from the
25        provisions of Section 250;
26            (T) For taxable years 2001 and thereafter, for the

 

 

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1        taxable year in which the bonus depreciation deduction
2        is taken on the taxpayer's federal income tax return
3        under subsection (k) of Section 168 of the Internal
4        Revenue Code and for each applicable taxable year
5        thereafter, an amount equal to "x", where:
6                (1) "y" equals the amount of the depreciation
7            deduction taken for the taxable year on the
8            taxpayer's federal income tax return on property
9            for which the bonus depreciation deduction was
10            taken in any year under subsection (k) of Section
11            168 of the Internal Revenue Code, but not
12            including the bonus depreciation deduction;
13                (2) for taxable years ending on or before
14            December 31, 2005, "x" equals "y" multiplied by 30
15            and then divided by 70 (or "y" multiplied by
16            0.429); and
17                (3) for taxable years ending after December
18            31, 2005:
19                    (i) for property on which a bonus
20                depreciation deduction of 30% of the adjusted
21                basis was taken, "x" equals "y" multiplied by
22                30 and then divided by 70 (or "y" multiplied
23                by 0.429);
24                    (ii) for property on which a bonus
25                depreciation deduction of 50% of the adjusted
26                basis was taken, "x" equals "y" multiplied by

 

 

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1                1.0;
2                    (iii) for property on which a bonus
3                depreciation deduction of 100% of the adjusted
4                basis was taken in a taxable year ending on or
5                after December 31, 2021, "x" equals the
6                depreciation deduction that would be allowed
7                on that property if the taxpayer had made the
8                election under Section 168(k)(7) of the
9                Internal Revenue Code to not claim bonus
10                depreciation on that property; and
11                    (iv) for property on which a bonus
12                depreciation deduction of a percentage other
13                than 30%, 50% or 100% of the adjusted basis
14                was taken in a taxable year ending on or after
15                December 31, 2021, "x" equals "y" multiplied
16                by 100 times the percentage bonus depreciation
17                on the property (that is, 100(bonus%)) and
18                then divided by 100 times 1 minus the
19                percentage bonus depreciation on the property
20                (that is, 100(1-bonus%)).
21            The aggregate amount deducted under this
22        subparagraph in all taxable years for any one piece of
23        property may not exceed the amount of the bonus
24        depreciation deduction taken on that property on the
25        taxpayer's federal income tax return under subsection
26        (k) of Section 168 of the Internal Revenue Code. This

 

 

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1        subparagraph (T) is exempt from the provisions of
2        Section 250;
3            (U) If the taxpayer sells, transfers, abandons, or
4        otherwise disposes of property for which the taxpayer
5        was required in any taxable year to make an addition
6        modification under subparagraph (E-10), then an amount
7        equal to that addition modification.
8            If the taxpayer continues to own property through
9        the last day of the last tax year for which a
10        subtraction is allowed with respect to that property
11        under subparagraph (T) and for which the taxpayer was
12        required in any taxable year to make an addition
13        modification under subparagraph (E-10), then an amount
14        equal to that addition modification.
15            The taxpayer is allowed to take the deduction
16        under this subparagraph only once with respect to any
17        one piece of property.
18            This subparagraph (U) is exempt from the
19        provisions of Section 250;
20            (V) The amount of: (i) any interest income (net of
21        the deductions allocable thereto) taken into account
22        for the taxable year with respect to a transaction
23        with a taxpayer that is required to make an addition
24        modification with respect to such transaction under
25        Section 203(a)(2)(D-17), 203(b)(2)(E-12),
26        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed

 

 

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1        the amount of such addition modification, (ii) any
2        income from intangible property (net of the deductions
3        allocable thereto) taken into account for the taxable
4        year with respect to a transaction with a taxpayer
5        that is required to make an addition modification with
6        respect to such transaction under Section
7        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
8        203(d)(2)(D-8), but not to exceed the amount of such
9        addition modification, and (iii) any insurance premium
10        income (net of deductions allocable thereto) taken
11        into account for the taxable year with respect to a
12        transaction with a taxpayer that is required to make
13        an addition modification with respect to such
14        transaction under Section 203(a)(2)(D-19), Section
15        203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section
16        203(d)(2)(D-9), but not to exceed the amount of that
17        addition modification. This subparagraph (V) is exempt
18        from the provisions of Section 250;
19            (W) An amount equal to the interest income taken
20        into account for the taxable year (net of the
21        deductions allocable thereto) with respect to
22        transactions with (i) a foreign person who would be a
23        member of the taxpayer's unitary business group but
24        for the fact that the foreign person's business
25        activity outside the United States is 80% or more of
26        that person's total business activity and (ii) for

 

 

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1        taxable years ending on or after December 31, 2008, to
2        a person who would be a member of the same unitary
3        business group but for the fact that the person is
4        prohibited under Section 1501(a)(27) from being
5        included in the unitary business group because he or
6        she is ordinarily required to apportion business
7        income under different subsections of Section 304, but
8        not to exceed the addition modification required to be
9        made for the same taxable year under Section
10        203(b)(2)(E-12) for interest paid, accrued, or
11        incurred, directly or indirectly, to the same person.
12        This subparagraph (W) is exempt from the provisions of
13        Section 250;
14            (X) An amount equal to the income from intangible
15        property taken into account for the taxable year (net
16        of the deductions allocable thereto) with respect to
17        transactions with (i) a foreign person who would be a
18        member of the taxpayer's unitary business group but
19        for the fact that the foreign person's business
20        activity outside the United States is 80% or more of
21        that person's total business activity and (ii) for
22        taxable years ending on or after December 31, 2008, to
23        a person who would be a member of the same unitary
24        business group but for the fact that the person is
25        prohibited under Section 1501(a)(27) from being
26        included in the unitary business group because he or

 

 

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1        she is ordinarily required to apportion business
2        income under different subsections of Section 304, but
3        not to exceed the addition modification required to be
4        made for the same taxable year under Section
5        203(b)(2)(E-13) for intangible expenses and costs
6        paid, accrued, or incurred, directly or indirectly, to
7        the same foreign person. This subparagraph (X) is
8        exempt from the provisions of Section 250;
9            (Y) For taxable years ending on or after December
10        31, 2011, in the case of a taxpayer who was required to
11        add back any insurance premiums under Section
12        203(b)(2)(E-14), such taxpayer may elect to subtract
13        that part of a reimbursement received from the
14        insurance company equal to the amount of the expense
15        or loss (including expenses incurred by the insurance
16        company) that would have been taken into account as a
17        deduction for federal income tax purposes if the
18        expense or loss had been uninsured. If a taxpayer
19        makes the election provided for by this subparagraph
20        (Y), the insurer to which the premiums were paid must
21        add back to income the amount subtracted by the
22        taxpayer pursuant to this subparagraph (Y). This
23        subparagraph (Y) is exempt from the provisions of
24        Section 250;
25            (Z) The difference between the nondeductible
26        controlled foreign corporation dividends under Section

 

 

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1        965(e)(3) of the Internal Revenue Code over the
2        taxable income of the taxpayer, computed without
3        regard to Section 965(e)(2)(A) of the Internal Revenue
4        Code, and without regard to any net operating loss
5        deduction. This subparagraph (Z) is exempt from the
6        provisions of Section 250; and
7            (AA) For taxable years beginning on or after
8        January 1, 2023, for any cannabis establishment
9        operating in this State and licensed under the
10        Cannabis Regulation and Tax Act or any cannabis
11        cultivation center or medical cannabis dispensing
12        organization operating in this State and licensed
13        under the Compassionate Use of Medical Cannabis
14        Program Act, an amount equal to the deductions that
15        were disallowed under Section 280E of the Internal
16        Revenue Code for the taxable year and that would not be
17        added back under this subsection. The provisions of
18        this subparagraph (AA) are exempt from the provisions
19        of Section 250.
20        (3) Special rule. For purposes of paragraph (2)(A),
21    "gross income" in the case of a life insurance company,
22    for tax years ending on and after December 31, 1994, and
23    prior to December 31, 2011, shall mean the gross
24    investment income for the taxable year and, for tax years
25    ending on or after December 31, 2011, shall mean all
26    amounts included in life insurance gross income under

 

 

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1    Section 803(a)(3) of the Internal Revenue Code.
 
2    (c) Trusts and estates.
3        (1) In general. In the case of a trust or estate, base
4    income means an amount equal to the taxpayer's taxable
5    income for the taxable year as modified by paragraph (2).
6        (2) Modifications. Subject to the provisions of
7    paragraph (3), the taxable income referred to in paragraph
8    (1) shall be modified by adding thereto the sum of the
9    following amounts:
10            (A) An amount equal to all amounts paid or accrued
11        to the taxpayer as interest or dividends during the
12        taxable year to the extent excluded from gross income
13        in the computation of taxable income;
14            (B) In the case of (i) an estate, $600; (ii) a
15        trust which, under its governing instrument, is
16        required to distribute all of its income currently,
17        $300; and (iii) any other trust, $100, but in each such
18        case, only to the extent such amount was deducted in
19        the computation of taxable income;
20            (C) An amount equal to the amount of tax imposed by
21        this Act to the extent deducted from gross income in
22        the computation of taxable income for the taxable
23        year;
24            (D) The amount of any net operating loss deduction
25        taken in arriving at taxable income, other than a net

 

 

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1        operating loss carried forward from a taxable year
2        ending prior to December 31, 1986;
3            (E) For taxable years in which a net operating
4        loss carryback or carryforward from a taxable year
5        ending prior to December 31, 1986 is an element of
6        taxable income under paragraph (1) of subsection (e)
7        or subparagraph (E) of paragraph (2) of subsection
8        (e), the amount by which addition modifications other
9        than those provided by this subparagraph (E) exceeded
10        subtraction modifications in such taxable year, with
11        the following limitations applied in the order that
12        they are listed:
13                (i) the addition modification relating to the
14            net operating loss carried back or forward to the
15            taxable year from any taxable year ending prior to
16            December 31, 1986 shall be reduced by the amount
17            of addition modification under this subparagraph
18            (E) which related to that net operating loss and
19            which was taken into account in calculating the
20            base income of an earlier taxable year, and
21                (ii) the addition modification relating to the
22            net operating loss carried back or forward to the
23            taxable year from any taxable year ending prior to
24            December 31, 1986 shall not exceed the amount of
25            such carryback or carryforward;
26            For taxable years in which there is a net

 

 

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1        operating loss carryback or carryforward from more
2        than one other taxable year ending prior to December
3        31, 1986, the addition modification provided in this
4        subparagraph (E) shall be the sum of the amounts
5        computed independently under the preceding provisions
6        of this subparagraph (E) for each such taxable year;
7            (F) For taxable years ending on or after January
8        1, 1989, an amount equal to the tax deducted pursuant
9        to Section 164 of the Internal Revenue Code if the
10        trust or estate is claiming the same tax for purposes
11        of the Illinois foreign tax credit under Section 601
12        of this Act;
13            (G) An amount equal to the amount of the capital
14        gain deduction allowable under the Internal Revenue
15        Code, to the extent deducted from gross income in the
16        computation of taxable income;
17            (G-5) For taxable years ending after December 31,
18        1997, an amount equal to any eligible remediation
19        costs that the trust or estate deducted in computing
20        adjusted gross income and for which the trust or
21        estate claims a credit under subsection (l) of Section
22        201;
23            (G-10) For taxable years 2001 and thereafter, an
24        amount equal to the bonus depreciation deduction taken
25        on the taxpayer's federal income tax return for the
26        taxable year under subsection (k) of Section 168 of

 

 

10300HB4951sam002- 71 -LRB103 38094 HLH 74177 a

1        the Internal Revenue Code; and
2            (G-11) If the taxpayer sells, transfers, abandons,
3        or otherwise disposes of property for which the
4        taxpayer was required in any taxable year to make an
5        addition modification under subparagraph (G-10), then
6        an amount equal to the aggregate amount of the
7        deductions taken in all taxable years under
8        subparagraph (R) with respect to that property.
9            If the taxpayer continues to own property through
10        the last day of the last tax year for which a
11        subtraction is allowed with respect to that property
12        under subparagraph (R) and for which the taxpayer was
13        allowed in any taxable year to make a subtraction
14        modification under subparagraph (R), then an amount
15        equal to that subtraction modification.
16            The taxpayer is required to make the addition
17        modification under this subparagraph only once with
18        respect to any one piece of property;
19            (G-12) An amount equal to the amount otherwise
20        allowed as a deduction in computing base income for
21        interest paid, accrued, or incurred, directly or
22        indirectly, (i) for taxable years ending on or after
23        December 31, 2004, to a foreign person who would be a
24        member of the same unitary business group but for the
25        fact that the foreign person's business activity
26        outside the United States is 80% or more of the foreign

 

 

10300HB4951sam002- 72 -LRB103 38094 HLH 74177 a

1        person's total business activity and (ii) for taxable
2        years ending on or after December 31, 2008, to a person
3        who would be a member of the same unitary business
4        group but for the fact that the person is prohibited
5        under Section 1501(a)(27) from being included in the
6        unitary business group because he or she is ordinarily
7        required to apportion business income under different
8        subsections of Section 304. The addition modification
9        required by this subparagraph shall be reduced to the
10        extent that dividends were included in base income of
11        the unitary group for the same taxable year and
12        received by the taxpayer or by a member of the
13        taxpayer's unitary business group (including amounts
14        included in gross income pursuant to Sections 951
15        through 964 of the Internal Revenue Code and amounts
16        included in gross income under Section 78 of the
17        Internal Revenue Code) with respect to the stock of
18        the same person to whom the interest was paid,
19        accrued, or incurred.
20            This paragraph shall not apply to the following:
21                (i) an item of interest paid, accrued, or
22            incurred, directly or indirectly, to a person who
23            is subject in a foreign country or state, other
24            than a state which requires mandatory unitary
25            reporting, to a tax on or measured by net income
26            with respect to such interest; or

 

 

10300HB4951sam002- 73 -LRB103 38094 HLH 74177 a

1                (ii) an item of interest paid, accrued, or
2            incurred, directly or indirectly, to a person if
3            the taxpayer can establish, based on a
4            preponderance of the evidence, both of the
5            following:
6                    (a) the person, during the same taxable
7                year, paid, accrued, or incurred, the interest
8                to a person that is not a related member, and
9                    (b) the transaction giving rise to the
10                interest expense between the taxpayer and the
11                person did not have as a principal purpose the
12                avoidance of Illinois income tax, and is paid
13                pursuant to a contract or agreement that
14                reflects an arm's-length interest rate and
15                terms; or
16                (iii) the taxpayer can establish, based on
17            clear and convincing evidence, that the interest
18            paid, accrued, or incurred relates to a contract
19            or agreement entered into at arm's-length rates
20            and terms and the principal purpose for the
21            payment is not federal or Illinois tax avoidance;
22            or
23                (iv) an item of interest paid, accrued, or
24            incurred, directly or indirectly, to a person if
25            the taxpayer establishes by clear and convincing
26            evidence that the adjustments are unreasonable; or

 

 

10300HB4951sam002- 74 -LRB103 38094 HLH 74177 a

1            if the taxpayer and the Director agree in writing
2            to the application or use of an alternative method
3            of apportionment under Section 304(f).
4                Nothing in this subsection shall preclude the
5            Director from making any other adjustment
6            otherwise allowed under Section 404 of this Act
7            for any tax year beginning after the effective
8            date of this amendment provided such adjustment is
9            made pursuant to regulation adopted by the
10            Department and such regulations provide methods
11            and standards by which the Department will utilize
12            its authority under Section 404 of this Act;
13            (G-13) An amount equal to the amount of intangible
14        expenses and costs otherwise allowed as a deduction in
15        computing base income, and that were paid, accrued, or
16        incurred, directly or indirectly, (i) for taxable
17        years ending on or after December 31, 2004, to a
18        foreign person who would be a member of the same
19        unitary business group but for the fact that the
20        foreign person's business activity outside the United
21        States is 80% or more of that person's total business
22        activity and (ii) for taxable years ending on or after
23        December 31, 2008, to a person who would be a member of
24        the same unitary business group but for the fact that
25        the person is prohibited under Section 1501(a)(27)
26        from being included in the unitary business group

 

 

10300HB4951sam002- 75 -LRB103 38094 HLH 74177 a

1        because he or she is ordinarily required to apportion
2        business income under different subsections of Section
3        304. The addition modification required by this
4        subparagraph shall be reduced to the extent that
5        dividends were included in base income of the unitary
6        group for the same taxable year and received by the
7        taxpayer or by a member of the taxpayer's unitary
8        business group (including amounts included in gross
9        income pursuant to Sections 951 through 964 of the
10        Internal Revenue Code and amounts included in gross
11        income under Section 78 of the Internal Revenue Code)
12        with respect to the stock of the same person to whom
13        the intangible expenses and costs were directly or
14        indirectly paid, incurred, or accrued. The preceding
15        sentence shall not apply to the extent that the same
16        dividends caused a reduction to the addition
17        modification required under Section 203(c)(2)(G-12) of
18        this Act. As used in this subparagraph, the term
19        "intangible expenses and costs" includes: (1)
20        expenses, losses, and costs for or related to the
21        direct or indirect acquisition, use, maintenance or
22        management, ownership, sale, exchange, or any other
23        disposition of intangible property; (2) losses
24        incurred, directly or indirectly, from factoring
25        transactions or discounting transactions; (3) royalty,
26        patent, technical, and copyright fees; (4) licensing

 

 

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1        fees; and (5) other similar expenses and costs. For
2        purposes of this subparagraph, "intangible property"
3        includes patents, patent applications, trade names,
4        trademarks, service marks, copyrights, mask works,
5        trade secrets, and similar types of intangible assets.
6            This paragraph shall not apply to the following:
7                (i) any item of intangible expenses or costs
8            paid, accrued, or incurred, directly or
9            indirectly, from a transaction with a person who
10            is subject in a foreign country or state, other
11            than a state which requires mandatory unitary
12            reporting, to a tax on or measured by net income
13            with respect to such item; or
14                (ii) any item of intangible expense or cost
15            paid, accrued, or incurred, directly or
16            indirectly, if the taxpayer can establish, based
17            on a preponderance of the evidence, both of the
18            following:
19                    (a) the person during the same taxable
20                year paid, accrued, or incurred, the
21                intangible expense or cost to a person that is
22                not a related member, and
23                    (b) the transaction giving rise to the
24                intangible expense or cost between the
25                taxpayer and the person did not have as a
26                principal purpose the avoidance of Illinois

 

 

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1                income tax, and is paid pursuant to a contract
2                or agreement that reflects arm's-length terms;
3                or
4                (iii) any item of intangible expense or cost
5            paid, accrued, or incurred, directly or
6            indirectly, from a transaction with a person if
7            the taxpayer establishes by clear and convincing
8            evidence, that the adjustments are unreasonable;
9            or if the taxpayer and the Director agree in
10            writing to the application or use of an
11            alternative method of apportionment under Section
12            304(f);
13                Nothing in this subsection shall preclude the
14            Director from making any other adjustment
15            otherwise allowed under Section 404 of this Act
16            for any tax year beginning after the effective
17            date of this amendment provided such adjustment is
18            made pursuant to regulation adopted by the
19            Department and such regulations provide methods
20            and standards by which the Department will utilize
21            its authority under Section 404 of this Act;
22            (G-14) For taxable years ending on or after
23        December 31, 2008, an amount equal to the amount of
24        insurance premium expenses and costs otherwise allowed
25        as a deduction in computing base income, and that were
26        paid, accrued, or incurred, directly or indirectly, to

 

 

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1        a person who would be a member of the same unitary
2        business group but for the fact that the person is
3        prohibited under Section 1501(a)(27) from being
4        included in the unitary business group because he or
5        she is ordinarily required to apportion business
6        income under different subsections of Section 304. The
7        addition modification required by this subparagraph
8        shall be reduced to the extent that dividends were
9        included in base income of the unitary group for the
10        same taxable year and received by the taxpayer or by a
11        member of the taxpayer's unitary business group
12        (including amounts included in gross income under
13        Sections 951 through 964 of the Internal Revenue Code
14        and amounts included in gross income under Section 78
15        of the Internal Revenue Code) with respect to the
16        stock of the same person to whom the premiums and costs
17        were directly or indirectly paid, incurred, or
18        accrued. The preceding sentence does not apply to the
19        extent that the same dividends caused a reduction to
20        the addition modification required under Section
21        203(c)(2)(G-12) or Section 203(c)(2)(G-13) of this
22        Act;
23            (G-15) An amount equal to the credit allowable to
24        the taxpayer under Section 218(a) of this Act,
25        determined without regard to Section 218(c) of this
26        Act;

 

 

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1            (G-16) For taxable years ending on or after
2        December 31, 2017, an amount equal to the deduction
3        allowed under Section 199 of the Internal Revenue Code
4        for the taxable year;
5    and by deducting from the total so obtained the sum of the
6    following amounts:
7            (H) An amount equal to all amounts included in
8        such total pursuant to the provisions of Sections
9        402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and 408
10        of the Internal Revenue Code or included in such total
11        as distributions under the provisions of any
12        retirement or disability plan for employees of any
13        governmental agency or unit, or retirement payments to
14        retired partners, which payments are excluded in
15        computing net earnings from self employment by Section
16        1402 of the Internal Revenue Code and regulations
17        adopted pursuant thereto;
18            (I) The valuation limitation amount;
19            (J) An amount equal to the amount of any tax
20        imposed by this Act which was refunded to the taxpayer
21        and included in such total for the taxable year;
22            (K) An amount equal to all amounts included in
23        taxable income as modified by subparagraphs (A), (B),
24        (C), (D), (E), (F) and (G) which are exempt from
25        taxation by this State either by reason of its
26        statutes or Constitution or by reason of the

 

 

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1        Constitution, treaties or statutes of the United
2        States; provided that, in the case of any statute of
3        this State that exempts income derived from bonds or
4        other obligations from the tax imposed under this Act,
5        the amount exempted shall be the interest net of bond
6        premium amortization;
7            (L) With the exception of any amounts subtracted
8        under subparagraph (K), an amount equal to the sum of
9        all amounts disallowed as deductions by (i) Sections
10        171(a)(2) and 265(a)(2) of the Internal Revenue Code,
11        and all amounts of expenses allocable to interest and
12        disallowed as deductions by Section 265(a)(1) of the
13        Internal Revenue Code; and (ii) for taxable years
14        ending on or after August 13, 1999, Sections
15        171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
16        Internal Revenue Code, plus, (iii) for taxable years
17        ending on or after December 31, 2011, Section
18        45G(e)(3) of the Internal Revenue Code and, for
19        taxable years ending on or after December 31, 2008,
20        any amount included in gross income under Section 87
21        of the Internal Revenue Code; the provisions of this
22        subparagraph are exempt from the provisions of Section
23        250;
24            (M) An amount equal to those dividends included in
25        such total which were paid by a corporation which
26        conducts business operations in a River Edge

 

 

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1        Redevelopment Zone or zones created under the River
2        Edge Redevelopment Zone Act and conducts substantially
3        all of its operations in a River Edge Redevelopment
4        Zone or zones. This subparagraph (M) is exempt from
5        the provisions of Section 250;
6            (N) An amount equal to any contribution made to a
7        job training project established pursuant to the Tax
8        Increment Allocation Redevelopment Act;
9            (O) An amount equal to those dividends included in
10        such total that were paid by a corporation that
11        conducts business operations in a federally designated
12        Foreign Trade Zone or Sub-Zone and that is designated
13        a High Impact Business located in Illinois; provided
14        that dividends eligible for the deduction provided in
15        subparagraph (M) of paragraph (2) of this subsection
16        shall not be eligible for the deduction provided under
17        this subparagraph (O);
18            (P) An amount equal to the amount of the deduction
19        used to compute the federal income tax credit for
20        restoration of substantial amounts held under claim of
21        right for the taxable year pursuant to Section 1341 of
22        the Internal Revenue Code;
23            (Q) For taxable year 1999 and thereafter, an
24        amount equal to the amount of any (i) distributions,
25        to the extent includible in gross income for federal
26        income tax purposes, made to the taxpayer because of

 

 

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1        his or her status as a victim of persecution for racial
2        or religious reasons by Nazi Germany or any other Axis
3        regime or as an heir of the victim and (ii) items of
4        income, to the extent includible in gross income for
5        federal income tax purposes, attributable to, derived
6        from or in any way related to assets stolen from,
7        hidden from, or otherwise lost to a victim of
8        persecution for racial or religious reasons by Nazi
9        Germany or any other Axis regime immediately prior to,
10        during, and immediately after World War II, including,
11        but not limited to, interest on the proceeds
12        receivable as insurance under policies issued to a
13        victim of persecution for racial or religious reasons
14        by Nazi Germany or any other Axis regime by European
15        insurance companies immediately prior to and during
16        World War II; provided, however, this subtraction from
17        federal adjusted gross income does not apply to assets
18        acquired with such assets or with the proceeds from
19        the sale of such assets; provided, further, this
20        paragraph shall only apply to a taxpayer who was the
21        first recipient of such assets after their recovery
22        and who is a victim of persecution for racial or
23        religious reasons by Nazi Germany or any other Axis
24        regime or as an heir of the victim. The amount of and
25        the eligibility for any public assistance, benefit, or
26        similar entitlement is not affected by the inclusion

 

 

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1        of items (i) and (ii) of this paragraph in gross income
2        for federal income tax purposes. This paragraph is
3        exempt from the provisions of Section 250;
4            (R) For taxable years 2001 and thereafter, for the
5        taxable year in which the bonus depreciation deduction
6        is taken on the taxpayer's federal income tax return
7        under subsection (k) of Section 168 of the Internal
8        Revenue Code and for each applicable taxable year
9        thereafter, an amount equal to "x", where:
10                (1) "y" equals the amount of the depreciation
11            deduction taken for the taxable year on the
12            taxpayer's federal income tax return on property
13            for which the bonus depreciation deduction was
14            taken in any year under subsection (k) of Section
15            168 of the Internal Revenue Code, but not
16            including the bonus depreciation deduction;
17                (2) for taxable years ending on or before
18            December 31, 2005, "x" equals "y" multiplied by 30
19            and then divided by 70 (or "y" multiplied by
20            0.429); and
21                (3) for taxable years ending after December
22            31, 2005:
23                    (i) for property on which a bonus
24                depreciation deduction of 30% of the adjusted
25                basis was taken, "x" equals "y" multiplied by
26                30 and then divided by 70 (or "y" multiplied

 

 

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1                by 0.429);
2                    (ii) for property on which a bonus
3                depreciation deduction of 50% of the adjusted
4                basis was taken, "x" equals "y" multiplied by
5                1.0;
6                    (iii) for property on which a bonus
7                depreciation deduction of 100% of the adjusted
8                basis was taken in a taxable year ending on or
9                after December 31, 2021, "x" equals the
10                depreciation deduction that would be allowed
11                on that property if the taxpayer had made the
12                election under Section 168(k)(7) of the
13                Internal Revenue Code to not claim bonus
14                depreciation on that property; and
15                    (iv) for property on which a bonus
16                depreciation deduction of a percentage other
17                than 30%, 50% or 100% of the adjusted basis
18                was taken in a taxable year ending on or after
19                December 31, 2021, "x" equals "y" multiplied
20                by 100 times the percentage bonus depreciation
21                on the property (that is, 100(bonus%)) and
22                then divided by 100 times 1 minus the
23                percentage bonus depreciation on the property
24                (that is, 100(1-bonus%)).
25            The aggregate amount deducted under this
26        subparagraph in all taxable years for any one piece of

 

 

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1        property may not exceed the amount of the bonus
2        depreciation deduction taken on that property on the
3        taxpayer's federal income tax return under subsection
4        (k) of Section 168 of the Internal Revenue Code. This
5        subparagraph (R) is exempt from the provisions of
6        Section 250;
7            (S) If the taxpayer sells, transfers, abandons, or
8        otherwise disposes of property for which the taxpayer
9        was required in any taxable year to make an addition
10        modification under subparagraph (G-10), then an amount
11        equal to that addition modification.
12            If the taxpayer continues to own property through
13        the last day of the last tax year for which a
14        subtraction is allowed with respect to that property
15        under subparagraph (R) and for which the taxpayer was
16        required in any taxable year to make an addition
17        modification under subparagraph (G-10), then an amount
18        equal to that addition modification.
19            The taxpayer is allowed to take the deduction
20        under this subparagraph only once with respect to any
21        one piece of property.
22            This subparagraph (S) is exempt from the
23        provisions of Section 250;
24            (T) The amount of (i) any interest income (net of
25        the deductions allocable thereto) taken into account
26        for the taxable year with respect to a transaction

 

 

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1        with a taxpayer that is required to make an addition
2        modification with respect to such transaction under
3        Section 203(a)(2)(D-17), 203(b)(2)(E-12),
4        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
5        the amount of such addition modification and (ii) any
6        income from intangible property (net of the deductions
7        allocable thereto) taken into account for the taxable
8        year with respect to a transaction with a taxpayer
9        that is required to make an addition modification with
10        respect to such transaction under Section
11        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
12        203(d)(2)(D-8), but not to exceed the amount of such
13        addition modification. This subparagraph (T) is exempt
14        from the provisions of Section 250;
15            (U) An amount equal to the interest income taken
16        into account for the taxable year (net of the
17        deductions allocable thereto) with respect to
18        transactions with (i) a foreign person who would be a
19        member of the taxpayer's unitary business group but
20        for the fact the foreign person's business activity
21        outside the United States is 80% or more of that
22        person's total business activity and (ii) for taxable
23        years ending on or after December 31, 2008, to a person
24        who would be a member of the same unitary business
25        group but for the fact that the person is prohibited
26        under Section 1501(a)(27) from being included in the

 

 

10300HB4951sam002- 87 -LRB103 38094 HLH 74177 a

1        unitary business group because he or she is ordinarily
2        required to apportion business income under different
3        subsections of Section 304, but not to exceed the
4        addition modification required to be made for the same
5        taxable year under Section 203(c)(2)(G-12) for
6        interest paid, accrued, or incurred, directly or
7        indirectly, to the same person. This subparagraph (U)
8        is exempt from the provisions of Section 250;
9            (V) An amount equal to the income from intangible
10        property taken into account for the taxable year (net
11        of the deductions allocable thereto) with respect to
12        transactions with (i) a foreign person who would be a
13        member of the taxpayer's unitary business group but
14        for the fact that the foreign person's business
15        activity outside the United States is 80% or more of
16        that person's total business activity and (ii) for
17        taxable years ending on or after December 31, 2008, to
18        a person who would be a member of the same unitary
19        business group but for the fact that the person is
20        prohibited under Section 1501(a)(27) from being
21        included in the unitary business group because he or
22        she is ordinarily required to apportion business
23        income under different subsections of Section 304, but
24        not to exceed the addition modification required to be
25        made for the same taxable year under Section
26        203(c)(2)(G-13) for intangible expenses and costs

 

 

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1        paid, accrued, or incurred, directly or indirectly, to
2        the same foreign person. This subparagraph (V) is
3        exempt from the provisions of Section 250;
4            (W) in the case of an estate, an amount equal to
5        all amounts included in such total pursuant to the
6        provisions of Section 111 of the Internal Revenue Code
7        as a recovery of items previously deducted by the
8        decedent from adjusted gross income in the computation
9        of taxable income. This subparagraph (W) is exempt
10        from Section 250;
11            (X) an amount equal to the refund included in such
12        total of any tax deducted for federal income tax
13        purposes, to the extent that deduction was added back
14        under subparagraph (F). This subparagraph (X) is
15        exempt from the provisions of Section 250;
16            (Y) For taxable years ending on or after December
17        31, 2011, in the case of a taxpayer who was required to
18        add back any insurance premiums under Section
19        203(c)(2)(G-14), such taxpayer may elect to subtract
20        that part of a reimbursement received from the
21        insurance company equal to the amount of the expense
22        or loss (including expenses incurred by the insurance
23        company) that would have been taken into account as a
24        deduction for federal income tax purposes if the
25        expense or loss had been uninsured. If a taxpayer
26        makes the election provided for by this subparagraph

 

 

10300HB4951sam002- 89 -LRB103 38094 HLH 74177 a

1        (Y), the insurer to which the premiums were paid must
2        add back to income the amount subtracted by the
3        taxpayer pursuant to this subparagraph (Y). This
4        subparagraph (Y) is exempt from the provisions of
5        Section 250;
6            (Z) For taxable years beginning after December 31,
7        2018 and before January 1, 2026, the amount of excess
8        business loss of the taxpayer disallowed as a
9        deduction by Section 461(l)(1)(B) of the Internal
10        Revenue Code; and
11            (AA) For taxable years beginning on or after
12        January 1, 2023, for any cannabis establishment
13        operating in this State and licensed under the
14        Cannabis Regulation and Tax Act or any cannabis
15        cultivation center or medical cannabis dispensing
16        organization operating in this State and licensed
17        under the Compassionate Use of Medical Cannabis
18        Program Act, an amount equal to the deductions that
19        were disallowed under Section 280E of the Internal
20        Revenue Code for the taxable year and that would not be
21        added back under this subsection. The provisions of
22        this subparagraph (AA) are exempt from the provisions
23        of Section 250.
24        (3) Limitation. The amount of any modification
25    otherwise required under this subsection shall, under
26    regulations prescribed by the Department, be adjusted by

 

 

10300HB4951sam002- 90 -LRB103 38094 HLH 74177 a

1    any amounts included therein which were properly paid,
2    credited, or required to be distributed, or permanently
3    set aside for charitable purposes pursuant to Internal
4    Revenue Code Section 642(c) during the taxable year.
 
5    (d) Partnerships.
6        (1) In general. In the case of a partnership, base
7    income means an amount equal to the taxpayer's taxable
8    income for the taxable year as modified by paragraph (2).
9        (2) Modifications. The taxable income referred to in
10    paragraph (1) shall be modified by adding thereto the sum
11    of the following amounts:
12            (A) An amount equal to all amounts paid or accrued
13        to the taxpayer as interest or dividends during the
14        taxable year to the extent excluded from gross income
15        in the computation of taxable income;
16            (B) An amount equal to the amount of tax imposed by
17        this Act to the extent deducted from gross income for
18        the taxable year;
19            (C) The amount of deductions allowed to the
20        partnership pursuant to Section 707 (c) of the
21        Internal Revenue Code in calculating its taxable
22        income;
23            (D) An amount equal to the amount of the capital
24        gain deduction allowable under the Internal Revenue
25        Code, to the extent deducted from gross income in the

 

 

10300HB4951sam002- 91 -LRB103 38094 HLH 74177 a

1        computation of taxable income;
2            (D-5) For taxable years 2001 and thereafter, an
3        amount equal to the bonus depreciation deduction taken
4        on the taxpayer's federal income tax return for the
5        taxable year under subsection (k) of Section 168 of
6        the Internal Revenue Code;
7            (D-6) If the taxpayer sells, transfers, abandons,
8        or otherwise disposes of property for which the
9        taxpayer was required in any taxable year to make an
10        addition modification under subparagraph (D-5), then
11        an amount equal to the aggregate amount of the
12        deductions taken in all taxable years under
13        subparagraph (O) with respect to that property.
14            If the taxpayer continues to own property through
15        the last day of the last tax year for which a
16        subtraction is allowed with respect to that property
17        under subparagraph (O) and for which the taxpayer was
18        allowed in any taxable year to make a subtraction
19        modification under subparagraph (O), then an amount
20        equal to that subtraction modification.
21            The taxpayer is required to make the addition
22        modification under this subparagraph only once with
23        respect to any one piece of property;
24            (D-7) An amount equal to the amount otherwise
25        allowed as a deduction in computing base income for
26        interest paid, accrued, or incurred, directly or

 

 

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1        indirectly, (i) for taxable years ending on or after
2        December 31, 2004, to a foreign person who would be a
3        member of the same unitary business group but for the
4        fact the foreign person's business activity outside
5        the United States is 80% or more of the foreign
6        person's total business activity and (ii) for taxable
7        years ending on or after December 31, 2008, to a person
8        who would be a member of the same unitary business
9        group but for the fact that the person is prohibited
10        under Section 1501(a)(27) from being included in the
11        unitary business group because he or she is ordinarily
12        required to apportion business income under different
13        subsections of Section 304. The addition modification
14        required by this subparagraph shall be reduced to the
15        extent that dividends were included in base income of
16        the unitary group for the same taxable year and
17        received by the taxpayer or by a member of the
18        taxpayer's unitary business group (including amounts
19        included in gross income pursuant to Sections 951
20        through 964 of the Internal Revenue Code and amounts
21        included in gross income under Section 78 of the
22        Internal Revenue Code) with respect to the stock of
23        the same person to whom the interest was paid,
24        accrued, or incurred.
25            This paragraph shall not apply to the following:
26                (i) an item of interest paid, accrued, or

 

 

10300HB4951sam002- 93 -LRB103 38094 HLH 74177 a

1            incurred, directly or indirectly, to a person who
2            is subject in a foreign country or state, other
3            than a state which requires mandatory unitary
4            reporting, to a tax on or measured by net income
5            with respect to such interest; or
6                (ii) an item of interest paid, accrued, or
7            incurred, directly or indirectly, to a person if
8            the taxpayer can establish, based on a
9            preponderance of the evidence, both of the
10            following:
11                    (a) the person, during the same taxable
12                year, paid, accrued, or incurred, the interest
13                to a person that is not a related member, and
14                    (b) the transaction giving rise to the
15                interest expense between the taxpayer and the
16                person did not have as a principal purpose the
17                avoidance of Illinois income tax, and is paid
18                pursuant to a contract or agreement that
19                reflects an arm's-length interest rate and
20                terms; or
21                (iii) the taxpayer can establish, based on
22            clear and convincing evidence, that the interest
23            paid, accrued, or incurred relates to a contract
24            or agreement entered into at arm's-length rates
25            and terms and the principal purpose for the
26            payment is not federal or Illinois tax avoidance;

 

 

10300HB4951sam002- 94 -LRB103 38094 HLH 74177 a

1            or
2                (iv) an item of interest paid, accrued, or
3            incurred, directly or indirectly, to a person if
4            the taxpayer establishes by clear and convincing
5            evidence that the adjustments are unreasonable; or
6            if the taxpayer and the Director agree in writing
7            to the application or use of an alternative method
8            of apportionment under Section 304(f).
9                Nothing in this subsection shall preclude the
10            Director from making any other adjustment
11            otherwise allowed under Section 404 of this Act
12            for any tax year beginning after the effective
13            date of this amendment provided such adjustment is
14            made pursuant to regulation adopted by the
15            Department and such regulations provide methods
16            and standards by which the Department will utilize
17            its authority under Section 404 of this Act; and
18            (D-8) An amount equal to the amount of intangible
19        expenses and costs otherwise allowed as a deduction in
20        computing base income, and that were paid, accrued, or
21        incurred, directly or indirectly, (i) for taxable
22        years ending on or after December 31, 2004, to a
23        foreign person who would be a member of the same
24        unitary business group but for the fact that the
25        foreign person's business activity outside the United
26        States is 80% or more of that person's total business

 

 

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1        activity and (ii) for taxable years ending on or after
2        December 31, 2008, to a person who would be a member of
3        the same unitary business group but for the fact that
4        the person is prohibited under Section 1501(a)(27)
5        from being included in the unitary business group
6        because he or she is ordinarily required to apportion
7        business income under different subsections of Section
8        304. The addition modification required by this
9        subparagraph shall be reduced to the extent that
10        dividends were included in base income of the unitary
11        group for the same taxable year and received by the
12        taxpayer or by a member of the taxpayer's unitary
13        business group (including amounts included in gross
14        income pursuant to Sections 951 through 964 of the
15        Internal Revenue Code and amounts included in gross
16        income under Section 78 of the Internal Revenue Code)
17        with respect to the stock of the same person to whom
18        the intangible expenses and costs were directly or
19        indirectly paid, incurred or accrued. The preceding
20        sentence shall not apply to the extent that the same
21        dividends caused a reduction to the addition
22        modification required under Section 203(d)(2)(D-7) of
23        this Act. As used in this subparagraph, the term
24        "intangible expenses and costs" includes (1) expenses,
25        losses, and costs for, or related to, the direct or
26        indirect acquisition, use, maintenance or management,

 

 

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1        ownership, sale, exchange, or any other disposition of
2        intangible property; (2) losses incurred, directly or
3        indirectly, from factoring transactions or discounting
4        transactions; (3) royalty, patent, technical, and
5        copyright fees; (4) licensing fees; and (5) other
6        similar expenses and costs. For purposes of this
7        subparagraph, "intangible property" includes patents,
8        patent applications, trade names, trademarks, service
9        marks, copyrights, mask works, trade secrets, and
10        similar types of intangible assets;
11            This paragraph shall not apply to the following:
12                (i) any item of intangible expenses or costs
13            paid, accrued, or incurred, directly or
14            indirectly, from a transaction with a person who
15            is subject in a foreign country or state, other
16            than a state which requires mandatory unitary
17            reporting, to a tax on or measured by net income
18            with respect to such item; or
19                (ii) any item of intangible expense or cost
20            paid, accrued, or incurred, directly or
21            indirectly, if the taxpayer can establish, based
22            on a preponderance of the evidence, both of the
23            following:
24                    (a) the person during the same taxable
25                year paid, accrued, or incurred, the
26                intangible expense or cost to a person that is

 

 

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1                not a related member, and
2                    (b) the transaction giving rise to the
3                intangible expense or cost between the
4                taxpayer and the person did not have as a
5                principal purpose the avoidance of Illinois
6                income tax, and is paid pursuant to a contract
7                or agreement that reflects arm's-length terms;
8                or
9                (iii) any item of intangible expense or cost
10            paid, accrued, or incurred, directly or
11            indirectly, from a transaction with a person if
12            the taxpayer establishes by clear and convincing
13            evidence, that the adjustments are unreasonable;
14            or if the taxpayer and the Director agree in
15            writing to the application or use of an
16            alternative method of apportionment under Section
17            304(f);
18                Nothing in this subsection shall preclude the
19            Director from making any other adjustment
20            otherwise allowed under Section 404 of this Act
21            for any tax year beginning after the effective
22            date of this amendment provided such adjustment is
23            made pursuant to regulation adopted by the
24            Department and such regulations provide methods
25            and standards by which the Department will utilize
26            its authority under Section 404 of this Act;

 

 

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1            (D-9) For taxable years ending on or after
2        December 31, 2008, an amount equal to the amount of
3        insurance premium expenses and costs otherwise allowed
4        as a deduction in computing base income, and that were
5        paid, accrued, or incurred, directly or indirectly, to
6        a person who would be a member of the same unitary
7        business group but for the fact that the person is
8        prohibited under Section 1501(a)(27) from being
9        included in the unitary business group because he or
10        she is ordinarily required to apportion business
11        income under different subsections of Section 304. The
12        addition modification required by this subparagraph
13        shall be reduced to the extent that dividends were
14        included in base income of the unitary group for the
15        same taxable year and received by the taxpayer or by a
16        member of the taxpayer's unitary business group
17        (including amounts included in gross income under
18        Sections 951 through 964 of the Internal Revenue Code
19        and amounts included in gross income under Section 78
20        of the Internal Revenue Code) with respect to the
21        stock of the same person to whom the premiums and costs
22        were directly or indirectly paid, incurred, or
23        accrued. The preceding sentence does not apply to the
24        extent that the same dividends caused a reduction to
25        the addition modification required under Section
26        203(d)(2)(D-7) or Section 203(d)(2)(D-8) of this Act;

 

 

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1            (D-10) An amount equal to the credit allowable to
2        the taxpayer under Section 218(a) of this Act,
3        determined without regard to Section 218(c) of this
4        Act;
5            (D-11) For taxable years ending on or after
6        December 31, 2017, an amount equal to the deduction
7        allowed under Section 199 of the Internal Revenue Code
8        for the taxable year;
9    and by deducting from the total so obtained the following
10    amounts:
11            (E) The valuation limitation amount;
12            (F) An amount equal to the amount of any tax
13        imposed by this Act which was refunded to the taxpayer
14        and included in such total for the taxable year;
15            (G) An amount equal to all amounts included in
16        taxable income as modified by subparagraphs (A), (B),
17        (C) and (D) which are exempt from taxation by this
18        State either by reason of its statutes or Constitution
19        or by reason of the Constitution, treaties or statutes
20        of the United States; provided that, in the case of any
21        statute of this State that exempts income derived from
22        bonds or other obligations from the tax imposed under
23        this Act, the amount exempted shall be the interest
24        net of bond premium amortization;
25            (H) Any income of the partnership which
26        constitutes personal service income as defined in

 

 

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1        Section 1348(b)(1) of the Internal Revenue Code (as in
2        effect December 31, 1981) or a reasonable allowance
3        for compensation paid or accrued for services rendered
4        by partners to the partnership, whichever is greater;
5        this subparagraph (H) is exempt from the provisions of
6        Section 250;
7            (I) An amount equal to all amounts of income
8        distributable to an entity subject to the Personal
9        Property Tax Replacement Income Tax imposed by
10        subsections (c) and (d) of Section 201 of this Act
11        including amounts distributable to organizations
12        exempt from federal income tax by reason of Section
13        501(a) of the Internal Revenue Code; this subparagraph
14        (I) is exempt from the provisions of Section 250;
15            (J) With the exception of any amounts subtracted
16        under subparagraph (G), an amount equal to the sum of
17        all amounts disallowed as deductions by (i) Sections
18        171(a)(2) and 265(a)(2) of the Internal Revenue Code,
19        and all amounts of expenses allocable to interest and
20        disallowed as deductions by Section 265(a)(1) of the
21        Internal Revenue Code; and (ii) for taxable years
22        ending on or after August 13, 1999, Sections
23        171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
24        Internal Revenue Code, plus, (iii) for taxable years
25        ending on or after December 31, 2011, Section
26        45G(e)(3) of the Internal Revenue Code and, for

 

 

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1        taxable years ending on or after December 31, 2008,
2        any amount included in gross income under Section 87
3        of the Internal Revenue Code; the provisions of this
4        subparagraph are exempt from the provisions of Section
5        250;
6            (K) An amount equal to those dividends included in
7        such total which were paid by a corporation which
8        conducts business operations in a River Edge
9        Redevelopment Zone or zones created under the River
10        Edge Redevelopment Zone Act and conducts substantially
11        all of its operations from a River Edge Redevelopment
12        Zone or zones. This subparagraph (K) is exempt from
13        the provisions of Section 250;
14            (L) An amount equal to any contribution made to a
15        job training project established pursuant to the Real
16        Property Tax Increment Allocation Redevelopment Act;
17            (M) An amount equal to those dividends included in
18        such total that were paid by a corporation that
19        conducts business operations in a federally designated
20        Foreign Trade Zone or Sub-Zone and that is designated
21        a High Impact Business located in Illinois; provided
22        that dividends eligible for the deduction provided in
23        subparagraph (K) of paragraph (2) of this subsection
24        shall not be eligible for the deduction provided under
25        this subparagraph (M);
26            (N) An amount equal to the amount of the deduction

 

 

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1        used to compute the federal income tax credit for
2        restoration of substantial amounts held under claim of
3        right for the taxable year pursuant to Section 1341 of
4        the Internal Revenue Code;
5            (O) For taxable years 2001 and thereafter, for the
6        taxable year in which the bonus depreciation deduction
7        is taken on the taxpayer's federal income tax return
8        under subsection (k) of Section 168 of the Internal
9        Revenue Code and for each applicable taxable year
10        thereafter, an amount equal to "x", where:
11                (1) "y" equals the amount of the depreciation
12            deduction taken for the taxable year on the
13            taxpayer's federal income tax return on property
14            for which the bonus depreciation deduction was
15            taken in any year under subsection (k) of Section
16            168 of the Internal Revenue Code, but not
17            including the bonus depreciation deduction;
18                (2) for taxable years ending on or before
19            December 31, 2005, "x" equals "y" multiplied by 30
20            and then divided by 70 (or "y" multiplied by
21            0.429); and
22                (3) for taxable years ending after December
23            31, 2005:
24                    (i) for property on which a bonus
25                depreciation deduction of 30% of the adjusted
26                basis was taken, "x" equals "y" multiplied by

 

 

10300HB4951sam002- 103 -LRB103 38094 HLH 74177 a

1                30 and then divided by 70 (or "y" multiplied
2                by 0.429);
3                    (ii) for property on which a bonus
4                depreciation deduction of 50% of the adjusted
5                basis was taken, "x" equals "y" multiplied by
6                1.0;
7                    (iii) for property on which a bonus
8                depreciation deduction of 100% of the adjusted
9                basis was taken in a taxable year ending on or
10                after December 31, 2021, "x" equals the
11                depreciation deduction that would be allowed
12                on that property if the taxpayer had made the
13                election under Section 168(k)(7) of the
14                Internal Revenue Code to not claim bonus
15                depreciation on that property; and
16                    (iv) for property on which a bonus
17                depreciation deduction of a percentage other
18                than 30%, 50% or 100% of the adjusted basis
19                was taken in a taxable year ending on or after
20                December 31, 2021, "x" equals "y" multiplied
21                by 100 times the percentage bonus depreciation
22                on the property (that is, 100(bonus%)) and
23                then divided by 100 times 1 minus the
24                percentage bonus depreciation on the property
25                (that is, 100(1-bonus%)).
26            The aggregate amount deducted under this

 

 

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1        subparagraph in all taxable years for any one piece of
2        property may not exceed the amount of the bonus
3        depreciation deduction taken on that property on the
4        taxpayer's federal income tax return under subsection
5        (k) of Section 168 of the Internal Revenue Code. This
6        subparagraph (O) is exempt from the provisions of
7        Section 250;
8            (P) If the taxpayer sells, transfers, abandons, or
9        otherwise disposes of property for which the taxpayer
10        was required in any taxable year to make an addition
11        modification under subparagraph (D-5), then an amount
12        equal to that addition modification.
13            If the taxpayer continues to own property through
14        the last day of the last tax year for which a
15        subtraction is allowed with respect to that property
16        under subparagraph (O) and for which the taxpayer was
17        required in any taxable year to make an addition
18        modification under subparagraph (D-5), then an amount
19        equal to that addition modification.
20            The taxpayer is allowed to take the deduction
21        under this subparagraph only once with respect to any
22        one piece of property.
23            This subparagraph (P) is exempt from the
24        provisions of Section 250;
25            (Q) The amount of (i) any interest income (net of
26        the deductions allocable thereto) taken into account

 

 

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1        for the taxable year with respect to a transaction
2        with a taxpayer that is required to make an addition
3        modification with respect to such transaction under
4        Section 203(a)(2)(D-17), 203(b)(2)(E-12),
5        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
6        the amount of such addition modification and (ii) any
7        income from intangible property (net of the deductions
8        allocable thereto) taken into account for the taxable
9        year with respect to a transaction with a taxpayer
10        that is required to make an addition modification with
11        respect to such transaction under Section
12        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
13        203(d)(2)(D-8), but not to exceed the amount of such
14        addition modification. This subparagraph (Q) is exempt
15        from Section 250;
16            (R) An amount equal to the interest income taken
17        into account for the taxable year (net of the
18        deductions allocable thereto) with respect to
19        transactions with (i) a foreign person who would be a
20        member of the taxpayer's unitary business group but
21        for the fact that the foreign person's business
22        activity outside the United States is 80% or more of
23        that person's total business activity and (ii) for
24        taxable years ending on or after December 31, 2008, to
25        a person who would be a member of the same unitary
26        business group but for the fact that the person is

 

 

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1        prohibited under Section 1501(a)(27) from being
2        included in the unitary business group because he or
3        she is ordinarily required to apportion business
4        income under different subsections of Section 304, but
5        not to exceed the addition modification required to be
6        made for the same taxable year under Section
7        203(d)(2)(D-7) for interest paid, accrued, or
8        incurred, directly or indirectly, to the same person.
9        This subparagraph (R) is exempt from Section 250;
10            (S) An amount equal to the income from intangible
11        property taken into account for the taxable year (net
12        of the deductions allocable thereto) with respect to
13        transactions with (i) a foreign person who would be a
14        member of the taxpayer's unitary business group but
15        for the fact that the foreign person's business
16        activity outside the United States is 80% or more of
17        that person's total business activity and (ii) for
18        taxable years ending on or after December 31, 2008, to
19        a person who would be a member of the same unitary
20        business group but for the fact that the person is
21        prohibited under Section 1501(a)(27) from being
22        included in the unitary business group because he or
23        she is ordinarily required to apportion business
24        income under different subsections of Section 304, but
25        not to exceed the addition modification required to be
26        made for the same taxable year under Section

 

 

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1        203(d)(2)(D-8) for intangible expenses and costs paid,
2        accrued, or incurred, directly or indirectly, to the
3        same person. This subparagraph (S) is exempt from
4        Section 250;
5            (T) For taxable years ending on or after December
6        31, 2011, in the case of a taxpayer who was required to
7        add back any insurance premiums under Section
8        203(d)(2)(D-9), such taxpayer may elect to subtract
9        that part of a reimbursement received from the
10        insurance company equal to the amount of the expense
11        or loss (including expenses incurred by the insurance
12        company) that would have been taken into account as a
13        deduction for federal income tax purposes if the
14        expense or loss had been uninsured. If a taxpayer
15        makes the election provided for by this subparagraph
16        (T), the insurer to which the premiums were paid must
17        add back to income the amount subtracted by the
18        taxpayer pursuant to this subparagraph (T). This
19        subparagraph (T) is exempt from the provisions of
20        Section 250; and
21            (U) For taxable years beginning on or after
22        January 1, 2023, for any cannabis establishment
23        operating in this State and licensed under the
24        Cannabis Regulation and Tax Act or any cannabis
25        cultivation center or medical cannabis dispensing
26        organization operating in this State and licensed

 

 

10300HB4951sam002- 108 -LRB103 38094 HLH 74177 a

1        under the Compassionate Use of Medical Cannabis
2        Program Act, an amount equal to the deductions that
3        were disallowed under Section 280E of the Internal
4        Revenue Code for the taxable year and that would not be
5        added back under this subsection. The provisions of
6        this subparagraph (U) are exempt from the provisions
7        of Section 250.
 
8    (e) Gross income; adjusted gross income; taxable income.
9        (1) In general. Subject to the provisions of paragraph
10    (2) and subsection (b)(3), for purposes of this Section
11    and Section 803(e), a taxpayer's gross income, adjusted
12    gross income, or taxable income for the taxable year shall
13    mean the amount of gross income, adjusted gross income or
14    taxable income properly reportable for federal income tax
15    purposes for the taxable year under the provisions of the
16    Internal Revenue Code. Taxable income may be less than
17    zero. However, for taxable years ending on or after
18    December 31, 1986, net operating loss carryforwards from
19    taxable years ending prior to December 31, 1986, may not
20    exceed the sum of federal taxable income for the taxable
21    year before net operating loss deduction, plus the excess
22    of addition modifications over subtraction modifications
23    for the taxable year. For taxable years ending prior to
24    December 31, 1986, taxable income may never be an amount
25    in excess of the net operating loss for the taxable year as

 

 

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1    defined in subsections (c) and (d) of Section 172 of the
2    Internal Revenue Code, provided that when taxable income
3    of a corporation (other than a Subchapter S corporation),
4    trust, or estate is less than zero and addition
5    modifications, other than those provided by subparagraph
6    (E) of paragraph (2) of subsection (b) for corporations or
7    subparagraph (E) of paragraph (2) of subsection (c) for
8    trusts and estates, exceed subtraction modifications, an
9    addition modification must be made under those
10    subparagraphs for any other taxable year to which the
11    taxable income less than zero (net operating loss) is
12    applied under Section 172 of the Internal Revenue Code or
13    under subparagraph (E) of paragraph (2) of this subsection
14    (e) applied in conjunction with Section 172 of the
15    Internal Revenue Code.
16        (2) Special rule. For purposes of paragraph (1) of
17    this subsection, the taxable income properly reportable
18    for federal income tax purposes shall mean:
19            (A) Certain life insurance companies. In the case
20        of a life insurance company subject to the tax imposed
21        by Section 801 of the Internal Revenue Code, life
22        insurance company taxable income, plus the amount of
23        distribution from pre-1984 policyholder surplus
24        accounts as calculated under Section 815a of the
25        Internal Revenue Code;
26            (B) Certain other insurance companies. In the case

 

 

10300HB4951sam002- 110 -LRB103 38094 HLH 74177 a

1        of mutual insurance companies subject to the tax
2        imposed by Section 831 of the Internal Revenue Code,
3        insurance company taxable income;
4            (C) Regulated investment companies. In the case of
5        a regulated investment company subject to the tax
6        imposed by Section 852 of the Internal Revenue Code,
7        investment company taxable income;
8            (D) Real estate investment trusts. In the case of
9        a real estate investment trust subject to the tax
10        imposed by Section 857 of the Internal Revenue Code,
11        real estate investment trust taxable income;
12            (E) Consolidated corporations. In the case of a
13        corporation which is a member of an affiliated group
14        of corporations filing a consolidated income tax
15        return for the taxable year for federal income tax
16        purposes, taxable income determined as if such
17        corporation had filed a separate return for federal
18        income tax purposes for the taxable year and each
19        preceding taxable year for which it was a member of an
20        affiliated group. For purposes of this subparagraph,
21        the taxpayer's separate taxable income shall be
22        determined as if the election provided by Section
23        243(b)(2) of the Internal Revenue Code had been in
24        effect for all such years;
25            (F) Cooperatives. In the case of a cooperative
26        corporation or association, the taxable income of such

 

 

10300HB4951sam002- 111 -LRB103 38094 HLH 74177 a

1        organization determined in accordance with the
2        provisions of Section 1381 through 1388 of the
3        Internal Revenue Code, but without regard to the
4        prohibition against offsetting losses from patronage
5        activities against income from nonpatronage
6        activities; except that a cooperative corporation or
7        association may make an election to follow its federal
8        income tax treatment of patronage losses and
9        nonpatronage losses. In the event such election is
10        made, such losses shall be computed and carried over
11        in a manner consistent with subsection (a) of Section
12        207 of this Act and apportioned by the apportionment
13        factor reported by the cooperative on its Illinois
14        income tax return filed for the taxable year in which
15        the losses are incurred. The election shall be
16        effective for all taxable years with original returns
17        due on or after the date of the election. In addition,
18        the cooperative may file an amended return or returns,
19        as allowed under this Act, to provide that the
20        election shall be effective for losses incurred or
21        carried forward for taxable years occurring prior to
22        the date of the election. Once made, the election may
23        only be revoked upon approval of the Director. The
24        Department shall adopt rules setting forth
25        requirements for documenting the elections and any
26        resulting Illinois net loss and the standards to be

 

 

10300HB4951sam002- 112 -LRB103 38094 HLH 74177 a

1        used by the Director in evaluating requests to revoke
2        elections. Public Act 96-932 is declaratory of
3        existing law;
4            (G) Subchapter S corporations. In the case of: (i)
5        a Subchapter S corporation for which there is in
6        effect an election for the taxable year under Section
7        1362 of the Internal Revenue Code, the taxable income
8        of such corporation determined in accordance with
9        Section 1363(b) of the Internal Revenue Code, except
10        that taxable income shall take into account those
11        items which are required by Section 1363(b)(1) of the
12        Internal Revenue Code to be separately stated; and
13        (ii) a Subchapter S corporation for which there is in
14        effect a federal election to opt out of the provisions
15        of the Subchapter S Revision Act of 1982 and have
16        applied instead the prior federal Subchapter S rules
17        as in effect on July 1, 1982, the taxable income of
18        such corporation determined in accordance with the
19        federal Subchapter S rules as in effect on July 1,
20        1982; and
21            (H) Partnerships. In the case of a partnership,
22        taxable income determined in accordance with Section
23        703 of the Internal Revenue Code, except that taxable
24        income shall take into account those items which are
25        required by Section 703(a)(1) to be separately stated
26        but which would be taken into account by an individual

 

 

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1        in calculating his taxable income.
2        (3) Recapture of business expenses on disposition of
3    asset or business. Notwithstanding any other law to the
4    contrary, if in prior years income from an asset or
5    business has been classified as business income and in a
6    later year is demonstrated to be non-business income, then
7    all expenses, without limitation, deducted in such later
8    year and in the 2 immediately preceding taxable years
9    related to that asset or business that generated the
10    non-business income shall be added back and recaptured as
11    business income in the year of the disposition of the
12    asset or business. Such amount shall be apportioned to
13    Illinois using the greater of the apportionment fraction
14    computed for the business under Section 304 of this Act
15    for the taxable year or the average of the apportionment
16    fractions computed for the business under Section 304 of
17    this Act for the taxable year and for the 2 immediately
18    preceding taxable years.
 
19    (f) Valuation limitation amount.
20        (1) In general. The valuation limitation amount
21    referred to in subsections (a)(2)(G), (c)(2)(I) and
22    (d)(2)(E) is an amount equal to:
23            (A) The sum of the pre-August 1, 1969 appreciation
24        amounts (to the extent consisting of gain reportable
25        under the provisions of Section 1245 or 1250 of the

 

 

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1        Internal Revenue Code) for all property in respect of
2        which such gain was reported for the taxable year;
3        plus
4            (B) The lesser of (i) the sum of the pre-August 1,
5        1969 appreciation amounts (to the extent consisting of
6        capital gain) for all property in respect of which
7        such gain was reported for federal income tax purposes
8        for the taxable year, or (ii) the net capital gain for
9        the taxable year, reduced in either case by any amount
10        of such gain included in the amount determined under
11        subsection (a)(2)(F) or (c)(2)(H).
12        (2) Pre-August 1, 1969 appreciation amount.
13            (A) If the fair market value of property referred
14        to in paragraph (1) was readily ascertainable on
15        August 1, 1969, the pre-August 1, 1969 appreciation
16        amount for such property is the lesser of (i) the
17        excess of such fair market value over the taxpayer's
18        basis (for determining gain) for such property on that
19        date (determined under the Internal Revenue Code as in
20        effect on that date), or (ii) the total gain realized
21        and reportable for federal income tax purposes in
22        respect of the sale, exchange or other disposition of
23        such property.
24            (B) If the fair market value of property referred
25        to in paragraph (1) was not readily ascertainable on
26        August 1, 1969, the pre-August 1, 1969 appreciation

 

 

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1        amount for such property is that amount which bears
2        the same ratio to the total gain reported in respect of
3        the property for federal income tax purposes for the
4        taxable year, as the number of full calendar months in
5        that part of the taxpayer's holding period for the
6        property ending July 31, 1969 bears to the number of
7        full calendar months in the taxpayer's entire holding
8        period for the property.
9            (C) The Department shall prescribe such
10        regulations as may be necessary to carry out the
11        purposes of this paragraph.
 
12    (g) Double deductions. Unless specifically provided
13otherwise, nothing in this Section shall permit the same item
14to be deducted more than once.
 
15    (h) Legislative intention. Except as expressly provided by
16this Section there shall be no modifications or limitations on
17the amounts of income, gain, loss or deduction taken into
18account in determining gross income, adjusted gross income or
19taxable income for federal income tax purposes for the taxable
20year, or in the amount of such items entering into the
21computation of base income and net income under this Act for
22such taxable year, whether in respect of property values as of
23August 1, 1969 or otherwise.
24(Source: P.A. 102-16, eff. 6-17-21; 102-558, eff. 8-20-21;

 

 

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1102-658, eff. 8-27-21; 102-813, eff. 5-13-22; 102-1112, eff.
212-21-22; 103-8, eff. 6-7-23; 103-478, eff. 1-1-24; revised
39-26-23.)
 
4
ARTICLE 15.

 
5    Section 15-5. The Property Tax Code is amended by changing
6Section 18-173 as follows:
 
7    (35 ILCS 200/18-173)
8    Sec. 18-173. Housing opportunity area abatement program.
9    (a) For the purpose of promoting access to housing near
10work and in order to promote economic diversity throughout
11Illinois and to alleviate the concentration of low-income
12households in areas of high poverty, a housing opportunity
13area tax abatement program is created.
14    (b) As used in this Section:
15    "Housing authority" means either a housing authority
16created under the Housing Authorities Act or other government
17agency that is authorized by the United States government
18under the United States Housing Act of 1937 to administer a
19housing choice voucher program, or the authorized agent of
20such a housing authority that is authorized to act upon that
21authority's behalf.
22    "Housing choice voucher" means a tenant voucher issued by
23a housing authority under Section 8 of the United States

 

 

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1Housing Act of 1937 and a tenant voucher converted to a
2project-based voucher by a housing authority.
3    "Housing opportunity area" means a census tract where less
4than 10% of the residents live below the poverty level, as
5defined by the United States government and determined by the
6most recent United States census, that is located within a
7qualified township, except for census tracts located within
8any township that is located wholly within a municipality with
91,000,000 or more inhabitants. A census tract that is located
10within a township that is located wholly within a municipality
11with 1,000,000 or more inhabitants is considered a housing
12opportunity area if less than 12% of the residents of the
13census tract live below the poverty level.
14    "Housing opportunity unit" means a dwelling unit located
15in residential property that is located in a housing
16opportunity area, that is owned by the applicant, and that is
17rented to and occupied by a tenant who is participating in a
18housing choice voucher program administered by a housing
19authority as of January 1st of the tax year for which the
20application is made.
21    "Qualified units" means the number of housing opportunity
22units located in the property with the limitation that no more
23than 2 units or 20% of the total units contained within the
24property, whichever is greater, may be considered qualified
25units. Further, no unit may be considered qualified unless the
26property in which it is contained is in substantial compliance

 

 

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1with local building codes, and, moreover, no unit may be
2considered qualified unless it meets the United States
3Department of Housing and Urban Development's housing quality
4standards as of the most recent housing authority inspection.
5    "Qualified township" means a township located within a
6county with 200,000 or more inhabitants whose tax capacity
7exceeds 80% of the average tax capacity of the county in which
8it is located, except for townships located within a county
9with 3,000,000 or more inhabitants, where a qualified township
10means a township whose tax capacity exceeds 115% of the
11average tax capacity of the county except for townships
12located wholly within a municipality with 1,000,000 or more
13inhabitants. All townships located wholly within a
14municipality with 1,000,000 or more inhabitants are considered
15qualified townships.
16    "Tax capacity" means the equalized assessed value of all
17taxable real estate located within a township or county
18divided by the total population of that township or county.
19    (c) The owner of property located within a housing
20opportunity area who has a housing choice voucher contract
21with a housing authority may apply for a housing opportunity
22area tax abatement by annually submitting an application to
23the housing authority that administers the housing choice
24voucher contract. The application must include the number of
25housing opportunity units as well as the total number of
26dwelling units contained within the property. The owner must,

 

 

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1under oath, self-certify as to the total number of dwelling
2units in the property and must self-certify that the property
3is in substantial compliance with local building codes. The
4housing authority shall annually determine the number of
5qualified units located within each property for which an
6application is made.
7    The housing authority shall establish rules and procedures
8governing the application processes and may charge an
9application fee. The county clerk may audit the applications
10to determine that the properties subject to the tax abatement
11meet the requirements of this Section. The determination of
12eligibility of a property for the housing opportunity area
13abatement shall be made annually; however, no property may
14receive an abatement for more than 10 tax years.
15    (d) The housing authority shall determine housing
16opportunity areas within its service area and annually deliver
17to the county clerk, in a manner determined by the county
18clerk, a list of all properties containing qualified units
19within that service area by December 31st of the tax year for
20which the property is eligible for abatement; the list shall
21include the number of qualified units and the total number of
22dwelling units for each property.
23    The county clerk shall deliver annually to a housing
24authority, upon that housing authority's request, the most
25recent available equalized assessed value for the county as a
26whole and for those taxing districts and townships so

 

 

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1specified by the requesting housing authority.
2    (e) The county clerk shall abate the tax attributed to a
3portion of the property determined to be eligible for a
4housing opportunity area abatement. The portion eligible for
5abatement shall be determined by reducing the equalized
6assessment value by a percentage calculated using the
7following formula: 19% of the equalized assessed value of the
8property multiplied by a fraction where the numerator is the
9number of qualified units and denominator is the total number
10of dwelling units located within the property.
11    (f) Any municipality, except for municipalities with
121,000,000 or more inhabitants, may annually petition the
13county clerk to be excluded from a housing opportunity area if
14it is able to demonstrate that more than 2.5% of the total
15residential units located within that municipality are
16occupied by tenants under the housing choice voucher program.
17Properties located within an excluded municipality shall not
18be eligible for the housing opportunity area abatement for the
19tax year in which the petition is made.
20    (g) Applicability. This Section applies to tax years 2004
21through 2034 2024, unless extended by law.
22(Source: P.A. 98-957, eff. 8-15-14.)
 
23
ARTICLE 20.

 
24    Section 20-5. The Property Tax Code is amended by changing

 

 

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1Section 21-355 as follows:
 
2    (35 ILCS 200/21-355)
3    Sec. 21-355. Amount of redemption. Any person desiring to
4redeem shall deposit an amount specified in this Section with
5the county clerk of the county in which the property is
6situated, in legal money of the United States, or by cashier's
7check, certified check, post office money order or money order
8issued by a financial institution insured by an agency or
9instrumentality of the United States, payable to the county
10clerk of the proper county. The deposit shall be deemed timely
11only if actually received in person at the county clerk's
12office prior to the close of business as defined in Section
133-2007 of the Counties Code on or before the expiration of the
14period of redemption or by United States mail with a post
15office cancellation mark dated not less than one day prior to
16the expiration of the period of redemption. The deposit shall
17be in an amount equal to the total of the following:
18        (a) the certificate amount, which shall include all
19    tax principal, special assessments, interest and penalties
20    paid by the tax purchaser together with costs and fees of
21    sale and fees paid under Sections 21-295 and 21-315
22    through 21-335, except for the nonrefundable $80 fee paid,
23    pursuant to Section 21-295, for each item purchased at the
24    tax sale;
25        (b) the accrued penalty, computed through the date of

 

 

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1    redemption as a percentage of the certificate amount, as
2    follows:
3            (1) if the redemption occurs on or before the
4        expiration of 6 months from the date of sale, the
5        certificate amount times the penalty bid at sale;
6            (2) if the redemption occurs after 6 months from
7        the date of sale, and on or before the expiration of 12
8        months from the date of sale, the certificate amount
9        times 2 times the penalty bid at sale;
10            (3) if the redemption occurs after 12 months from
11        the date of sale and on or before the expiration of 18
12        months from the date of sale, the certificate amount
13        times 3 times the penalty bid at sale;
14            (4) if the redemption occurs after 18 months from
15        the date of sale and on or before the expiration of 24
16        months from the date of sale, the certificate amount
17        times 4 times the penalty bid at sale;
18            (5) if the redemption occurs after 24 months from
19        the date of sale and on or before the expiration of 30
20        months from the date of sale, the certificate amount
21        times 5 times the penalty bid at sale;
22            (6) if the redemption occurs after 30 months from
23        the date of sale and on or before the expiration of 36
24        months from the date of sale, the certificate amount
25        times 6 times the penalty bid at sale.
26        In the event that the property to be redeemed has been

 

 

10300HB4951sam002- 123 -LRB103 38094 HLH 74177 a

1    purchased under Section 21-405 before January 1, 2024, the
2    penalty bid shall be 12% per penalty period as set forth in
3    subparagraphs (1) through (6) of this subsection (b). The
4    changes to this subdivision (b)(6) made by this amendatory
5    Act of the 91st General Assembly are not a new enactment,
6    but declaratory of existing law.
7        For counties with fewer than 3,000,000 inhabitants, if
8    the property to be redeemed is property with respect to
9    which a tax lien or certificate is acquired after January
10    1, 2024 by the county as trustee pursuant to Section
11    21-90, the penalty bid at sale shall accrue according to
12    the penalty periods established in subparagraphs (1)
13    through (6) of this subsection (b).
14        For counties with more than 3,000,000 inhabitants, if
15    If the property to be redeemed is property with respect to
16    which a tax lien or certificate is acquired on or after
17    January 1, 2024 by the county as trustee pursuant to
18    Section 21-90, the penalty bid is 0.75% and shall accrue
19    monthly instead of according to the penalty periods
20    established in subparagraphs (1) through (6) of this
21    subsection (b).
22        (c) The total of all taxes, special assessments,
23    accrued interest on those taxes and special assessments
24    and costs charged in connection with the payment of those
25    taxes or special assessments, except for the nonrefundable
26    $80 fee paid, pursuant to Section 21-295, for each item

 

 

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1    purchased at the tax sale, which have been paid by the tax
2    certificate holder on or after the date those taxes or
3    special assessments became delinquent together with 12%
4    penalty on each amount so paid for each year or portion
5    thereof intervening between the date of that payment and
6    the date of redemption. In counties with less than
7    3,000,000 inhabitants, however, a tax certificate holder
8    may not pay all or part of an installment of a subsequent
9    tax or special assessment for any year, nor shall any
10    tender of such a payment be accepted, until after the
11    second or final installment of the subsequent tax or
12    special assessment has become delinquent or until after
13    the holder of the certificate of purchase has filed a
14    petition for a tax deed under Section 22.30. The person
15    redeeming shall also pay the amount of interest charged on
16    the subsequent tax or special assessment and paid as a
17    penalty by the tax certificate holder. This amendatory Act
18    of 1995 applies to tax years beginning with the 1995
19    taxes, payable in 1996, and thereafter.
20        (d) Any amount paid to redeem a forfeiture occurring
21    before January 1, 2024 but after the tax sale together
22    with 12% penalty thereon for each year or portion thereof
23    intervening between the date of the forfeiture redemption
24    and the date of redemption from the sale.
25        (e) Any amount paid by the certificate holder for
26    redemption of a subsequently occurring tax sale, including

 

 

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1    tax liens or certificates held by the county as trustee,
2    pursuant to Section 21-90.
3        (f) All fees paid to the county clerk under Section
4    22-5.
5        (g) All fees paid to the registrar of titles incident
6    to registering the tax certificate in compliance with the
7    Registered Titles (Torrens) Act.
8        (h) All fees paid to the circuit clerk and the
9    sheriff, a licensed or registered private detective, or
10    the coroner in connection with the filing of the petition
11    for tax deed and service of notices under Sections 22-15
12    through 22-30 and 22-40 in addition to (1) a fee of $35 if
13    a petition for tax deed has been filed, which fee shall be
14    posted to the tax judgement, sale, redemption, and
15    forfeiture record, to be paid to the purchaser or his or
16    her assignee; (2) a fee of $4 if a notice under Section
17    22-5 has been filed, which fee shall be posted to the tax
18    judgment, sale, redemption, and forfeiture record, to be
19    paid to the purchaser or his or her assignee; (3) all costs
20    paid to record a lis pendens notice in connection with
21    filing a petition under this Code; and (4) if a petition
22    for tax deed has been filed, all fees up to $150 per
23    redemption paid to a registered or licensed title
24    insurance company or title insurance agent for a title
25    search to identify all owners, parties interested, and
26    occupants of the property, to be paid to the purchaser or

 

 

10300HB4951sam002- 126 -LRB103 38094 HLH 74177 a

1    his or her assignee. The fees in (1) and (2) of this
2    paragraph (h) shall be exempt from the posting
3    requirements of Section 21-360. The costs incurred in
4    causing notices to be served by a licensed or registered
5    private detective under Section 22-15, may not exceed the
6    amount that the sheriff would be authorized by law to
7    charge if those notices had been served by the sheriff.
8        (i) All fees paid for publication of notice of the tax
9    sale in accordance with Section 22-20.
10        (j) All sums paid to any county, city, village or
11    incorporated town for reimbursement under Section 22-35.
12        (k) All costs and expenses of receivership under
13    Section 21-410, to the extent that these costs and
14    expenses exceed any income from the property in question,
15    if the costs and expenditures have been approved by the
16    court appointing the receiver and a certified copy of the
17    order or approval is filed and posted by the certificate
18    holder with the county clerk. Only actual costs expended
19    may be posted on the tax judgment, sale, redemption and
20    forfeiture record.
21(Source: P.A. 103-555, eff. 1-1-24.)
 
22
ARTICLE 25.

 
23    Section 25-5. The Property Tax Code is amended by changing
24Section 20-15 as follows:
 

 

 

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1    (35 ILCS 200/20-15)
2    Sec. 20-15. Information on bill or separate statement.
3There shall be printed on each bill, or on a separate slip
4which shall be mailed with the bill:
5        (a) a statement itemizing the rate at which taxes have
6    been extended for each of the taxing districts in the
7    county in whose district the property is located, and in
8    those counties utilizing electronic data processing
9    equipment the dollar amount of tax due from the person
10    assessed allocable to each of those taxing districts,
11    including a separate statement of the dollar amount of tax
12    due which is allocable to a tax levied under the Illinois
13    Local Library Act or to any other tax levied by a
14    municipality or township for public library purposes,
15        (b) a separate statement for each of the taxing
16    districts of the dollar amount of tax due which is
17    allocable to a tax levied under the Illinois Pension Code
18    or to any other tax levied by a municipality or township
19    for public pension or retirement purposes,
20        (b-5) a list of each tax increment financing (TIF)
21    district in which the property is located and the dollar
22    amount of tax due that is allocable to the TIF district,
23        (c) the total tax rate,
24        (d) the total amount of tax due, and
25        (e) the amount by which the total tax and the tax

 

 

10300HB4951sam002- 128 -LRB103 38094 HLH 74177 a

1    allocable to each taxing district differs from the
2    taxpayer's last prior tax bill.
3    The county treasurer shall ensure that only those taxing
4districts in which a parcel of property is located shall be
5listed on the bill for that property.
6    In all counties the statement shall also provide:
7        (1) the property index number or other suitable
8    description,
9        (2) the assessment of the property,
10        (3) the statutory amount of each homestead exemption
11    applied to the property,
12        (4) the assessed value of the property after
13    application of all homestead exemptions,
14        (5) the equalization factors imposed by the county and
15    by the Department, and
16        (6) the equalized assessment resulting from the
17    application of the equalization factors to the basic
18    assessment.
19    In all counties which do not classify property for
20purposes of taxation, for property on which a single family
21residence is situated the statement shall also include a
22statement to reflect the fair cash value determined for the
23property. In all counties which classify property for purposes
24of taxation in accordance with Section 4 of Article IX of the
25Illinois Constitution, for parcels of residential property in
26the lowest assessment classification the statement shall also

 

 

10300HB4951sam002- 129 -LRB103 38094 HLH 74177 a

1include a statement to reflect the fair cash value determined
2for the property.
3    In all counties, the statement must include information
4that certain taxpayers may be eligible for tax exemptions,
5abatements, and other assistance programs and that, for more
6information, taxpayers should consult with the office of their
7township or county assessor and with the Illinois Department
8of Revenue. For bills mailed on or after January 1, 2026, the
9statement must include, in bold face type, a list of
10exemptions available to taxpayers and contact information for
11the chief county assessment officer.
12    In counties which use the estimated or accelerated billing
13methods, these statements shall only be provided with the
14final installment of taxes due. The provisions of this Section
15create a mandatory statutory duty. They are not merely
16directory or discretionary. The failure or neglect of the
17collector to mail the bill, or the failure of the taxpayer to
18receive the bill, shall not affect the validity of any tax, or
19the liability for the payment of any tax.
20(Source: P.A. 100-621, eff. 7-20-18; 101-134, eff. 7-26-19.)
 
21
ARTICLE 30.

 
22    Section 30-5. The Property Tax Code is amended by changing
23Section 30-25 as follows:
 

 

 

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1    (35 ILCS 200/30-25)
2    Sec. 30-25. Distributions from account.
3    (a) At the direction of the corporate authorities of a
4taxing district, the treasurer of the taxing district shall
5disburse the amounts held in the tax reimbursement account.
6Unless the taxing district has divided the moneys as provided
7in subsection (b), disbursements shall be made to all of the
8owners of taxable homestead property within the taxing
9district. Each owner of taxable homestead property shall
10receive a proportionate share of the total disbursement based
11on the amount of ad valorem taxes on taxable homestead
12property paid by the owner to the taxing district under the
13most recent tax bill.
14    (b) The corporate authorities of a taxing district may
15direct the treasurer to divide the moneys deposited into the
16account into 2 separate pools to be designated the homestead
17property pool and the commercial or industrial property pool.
18The amount to be deposited into each pool shall be determined
19by the corporate authorities of the taxing district, except
20that at least 50% of the moneys in the account shall be
21deposited into the homestead property pool. The treasurer
22shall disburse the amounts held in each pool in the tax
23reimbursement account at the direction of the corporate
24authorities. Disbursements from the homestead property pool
25shall be made to all of the owners of taxable homestead
26property within the taxing district. Each owner of taxable

 

 

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1homestead property shall receive a proportionate share of the
2total disbursement from the pool based on the amount of ad
3valorem taxes on taxable homestead property paid by the owner
4to the taxing district under the most recent tax bill.
5Disbursements from the commercial or industrial property pool
6shall be made to all of the owners of taxable commercial or
7industrial property, except (i) those owners whose property is
8located within a tax increment financing district, (ii) those
9owners who received a tax incentive as a result of a tax
10incentivized development established by an intergovernmental
11agreement to which the taxing district is a party, or (iii)
12those owners whose property is classified as an apartment
13building. Each eligible owner of taxable commercial or
14industrial property shall receive a proportionate share of the
15total disbursement from the pool based on the amount of ad
16valorem taxes on taxable commercial or industrial property
17paid by the owner to the taxing district under the most recent
18tax bill.
19    (c) In determining the proportionate share of each owner
20of homestead property, the numerator shall be the amount of
21taxes on homestead property paid by that owner to the taxing
22district under the most recent tax bill, and the denominator
23shall be the aggregate total of all taxes on homestead
24property paid by all owners to the taxing district under the
25most recent tax bills.
26    (d) In determining the proportionate share of each owner

 

 

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1of commercial or industrial property, the numerator shall be
2the amount of taxes on commercial or industrial property paid
3by that owner to the taxing district under the most recent tax
4bill, and the denominator shall be the aggregate total of all
5taxes on commercial or industrial property paid by all owners
6to the taxing district under the most recent tax bills less
7taxes paid on commercial or industrial property located in a
8tax increment financing district, taxes paid on commercial or
9industrial property for which the owner received a tax
10incentive as a result of a tax incentivized development
11established by an intergovernmental agreement to which the
12taxing district is a party, and taxes paid on an apartment
13building.
14    (e) As used in this Section:
15    "Qualified redevelopment costs" means costs advanced by a
16taxing district to a commercial or industrial property owner
17to promote economic development when, but for the advancement
18of the funds, the development would not be financially
19feasible.
20    "Tax incentivized development" means an economic
21development project established by intergovernmental agreement
22whereby a taxing district advances qualified redevelopment
23costs to a commercial or industrial property owner.
24(Source: P.A. 90-471, eff. 8-17-97.)
 
25
ARTICLE 35.

 

 

 

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1    Section 35-5. The Property Tax Code is amended by changing
2Sections 18-15 and 18-190 and by adding Section 18-17 as
3follows:
 
4    (35 ILCS 200/18-15)
5    Sec. 18-15. Filing of levies of taxing districts.
6    (a) Notwithstanding any other law to the contrary, all
7taxing districts, other than a school district subject to the
8authority of a Financial Oversight Panel pursuant to Article
91H of the School Code, and except as provided in Section 18-17,
10shall annually certify to the county clerk, on or before the
11last Tuesday in December, the several amounts that they have
12levied.
13    (a-5) Certification to the county clerk under subsection
14(a), including any supplemental or supportive documentation,
15may be submitted electronically.
16    (b) A school district subject to the authority of a
17Financial Oversight Panel pursuant to Article 1H of the School
18Code shall file a certificate of tax levy, necessary to effect
19the implementation of the approved financial plan and the
20approval of the Panel, as otherwise provided by this Section,
21except that the certificate must be certified to the county
22clerk on or before the first Tuesday in November.
23    (c) If a school district as specified in subsection (b) of
24this Section fails to certify and return the certificate of

 

 

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1tax levy, necessary to effect the implementation of the
2approved financial plan and the approval of the Financial
3Oversight Panel, to the county clerk on or before the first
4Tuesday in November, then the Financial Oversight Panel for
5the school district shall proceed to adopt, certify, and
6return a certificate of tax levy for the school district to the
7county clerk on or before the last Tuesday in December.
8(Source: P.A. 102-625, eff. 1-1-22.)
 
9    (35 ILCS 200/18-17 new)
10    Sec. 18-17. Supplemental levy for LaMoille Community Unit
11School District #303. Notwithstanding any other provision of
12law, LaMoille Community Unit School District #303 may, by
13ordinance adopted on or before June 30, 2024, amend or
14supplement its levy for the 2023 tax year for taxes scheduled
15to be collected in calendar year 2024. The District shall
16certify the amount of the amended or supplemental levy to the
17county clerk as soon as possible after the amended or
18supplemental levy is adopted, and the county clerk shall
19include those amounts in the extension of taxes for the 2023
20tax year. In no event shall the amended or supplemental levy
21adopted under this Section cause the District's property tax
22rate for the 2023 tax year to exceed the District's limiting
23rate under the Property Tax Extension Limitation Law or any
24other limitation on the extension of property taxes applicable
25to the District. This Section is repealed on January 1, 2025.
 

 

 

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1    (35 ILCS 200/18-190)
2    Sec. 18-190. Direct referendum; new rate or increased
3limiting rate.
4    (a) If a new rate is authorized by statute to be imposed
5without referendum or is subject to a backdoor referendum, as
6defined in Section 28-2 of the Election Code, the governing
7body of the affected taxing district before levying the new
8rate shall submit the new rate to direct referendum under the
9provisions of this Section and of Article 28 of the Election
10Code. Notwithstanding any other provision of law, the levies
11authorized by Sections 21-110 and 21-110.1 of the Illinois
12Pension Code shall not be considered new rates; however,
13nothing in this amendatory Act of the 98th General Assembly
14authorizes a taxing district to increase its limiting rate or
15its aggregate extension without first obtaining referendum
16approval as provided in this Section. Notwithstanding any
17other provision of law, the levy authorized by Section 18-17
18is considered part of the annual corporate extension for the
19taxing district and is not considered a new rate.
20Notwithstanding the provisions, requirements, or limitations
21of any other law, any tax levied for the 2005 levy year and all
22subsequent levy years by any taxing district subject to this
23Law may be extended at a rate exceeding the rate established
24for that tax by referendum or statute, provided that the rate
25does not exceed the statutory ceiling above which the tax is

 

 

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1not authorized to be further increased either by referendum or
2in any other manner. Notwithstanding the provisions,
3requirements, or limitations of any other law, all taxing
4districts subject to this Law shall follow the provisions of
5this Section whenever seeking referenda approval after March
621, 2006 to (i) levy a new tax rate authorized by statute or
7(ii) increase the limiting rate applicable to the taxing
8district. All taxing districts subject to this Law are
9authorized to seek referendum approval of each proposition
10described and set forth in this Section.
11    The proposition seeking to obtain referendum approval to
12levy a new tax rate as authorized in clause (i) shall be in
13substantially the following form:
14        Shall ... (insert legal name, number, if any, and
15    county or counties of taxing district and geographic or
16    other common name by which a school or community college
17    district is known and referred to), Illinois, be
18    authorized to levy a new tax for ... purposes and have an
19    additional tax of ...% of the equalized assessed value of
20    the taxable property therein extended for such purposes?
21The votes must be recorded as "Yes" or "No".
22    The proposition seeking to obtain referendum approval to
23increase the limiting rate as authorized in clause (ii) shall
24be in substantially the following form:
25        Shall the limiting rate under the Property Tax
26    Extension Limitation Law for ... (insert legal name,

 

 

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1    number, if any, and county or counties of taxing district
2    and geographic or other common name by which a school or
3    community college district is known and referred to),
4    Illinois, be increased by an additional amount equal to
5    ...% above the limiting rate for the purpose of...(insert
6    purpose) for levy year ... (insert the most recent levy
7    year for which the limiting rate of the taxing district is
8    known at the time the submission of the proposition is
9    initiated by the taxing district) and be equal to ...% of
10    the equalized assessed value of the taxable property
11    therein for levy year(s) (insert each levy year for which
12    the increase will be applicable, which years must be
13    consecutive and may not exceed 4)?
14    The votes must be recorded as "Yes" or "No".
15    The ballot for any proposition submitted pursuant to this
16Section shall have printed thereon, but not as a part of the
17proposition submitted, only the following supplemental
18information (which shall be supplied to the election authority
19by the taxing district) in substantially the following form:
20        (1) The approximate amount of taxes extendable at the
21    most recently extended limiting rate is $..., and the
22    approximate amount of taxes extendable if the proposition
23    is approved is $....
24        (2) For the ... (insert the first levy year for which
25    the new rate or increased limiting rate will be
26    applicable) levy year the approximate amount of the

 

 

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1    additional tax extendable against property containing a
2    single family residence and having a fair market value at
3    the time of the referendum of $100,000 is estimated to be
4    $....
5        (3) Based upon an average annual percentage increase
6    (or decrease) in the market value of such property of %...
7    (insert percentage equal to the average annual percentage
8    increase or decrease for the prior 3 levy years, at the
9    time the submission of the proposition is initiated by the
10    taxing district, in the amount of (A) the equalized
11    assessed value of the taxable property in the taxing
12    district less (B) the new property included in the
13    equalized assessed value), the approximate amount of the
14    additional tax extendable against such property for the
15    ... levy year is estimated to be $... and for the ... levy
16    year is estimated to be $ ....
17        (4) If the proposition is approved, the aggregate
18    extension for ... (insert each levy year for which the
19    increase will apply) will be determined by the limiting
20    rate set forth in the proposition, rather than the
21    otherwise applicable limiting rate calculated under the
22    provisions of the Property Tax Extension Limitation Law
23    (commonly known as the Property Tax Cap Law).
24The approximate amount of taxes extendable shown in paragraph
25(1) shall be computed upon the last known equalized assessed
26value of taxable property in the taxing district (at the time

 

 

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1the submission of the proposition is initiated by the taxing
2district). Paragraph (3) shall be included only if the
3increased limiting rate will be applicable for more than one
4levy year and shall list each levy year for which the increased
5limiting rate will be applicable. The additional tax shown for
6each levy year shall be the approximate dollar amount of the
7increase over the amount of the most recently completed
8extension at the time the submission of the proposition is
9initiated by the taxing district. The approximate amount of
10the additional taxes extendable shown in paragraphs (2) and
11(3) shall be calculated by multiplying $100,000 (the fair
12market value of the property without regard to any property
13tax exemptions) by (i) the percentage level of assessment
14prescribed for that property by statute, or by ordinance of
15the county board in counties that classify property for
16purposes of taxation in accordance with Section 4 of Article
17IX of the Illinois Constitution; (ii) the most recent final
18equalization factor certified to the county clerk by the
19Department of Revenue at the time the taxing district
20initiates the submission of the proposition to the electors;
21and (iii) either the new rate or the amount by which the
22limiting rate is to be increased. This amendatory Act of the
2397th General Assembly is intended to clarify the existing
24requirements of this Section, and shall not be construed to
25validate any prior non-compliant referendum language.
26Paragraph (4) shall be included if the proposition concerns a

 

 

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1limiting rate increase but shall not be included if the
2proposition concerns a new rate. Any notice required to be
3published in connection with the submission of the proposition
4shall also contain this supplemental information and shall not
5contain any other supplemental information regarding the
6proposition. Any error, miscalculation, or inaccuracy in
7computing any amount set forth on the ballot and in the notice
8that is not deliberate shall not invalidate or affect the
9validity of any proposition approved. Notice of the referendum
10shall be published and posted as otherwise required by law,
11and the submission of the proposition shall be initiated as
12provided by law.
13    If a majority of all ballots cast on the proposition are in
14favor of the proposition, the following provisions shall be
15applicable to the extension of taxes for the taxing district:
16        (A) a new tax rate shall be first effective for the
17    levy year in which the new rate is approved;
18        (B) if the proposition provides for a new tax rate,
19    the taxing district is authorized to levy a tax after the
20    canvass of the results of the referendum by the election
21    authority for the purposes for which the tax is
22    authorized;
23        (C) a limiting rate increase shall be first effective
24    for the levy year in which the limiting rate increase is
25    approved, provided that the taxing district may elect to
26    have a limiting rate increase be effective for the levy

 

 

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1    year prior to the levy year in which the limiting rate
2    increase is approved unless the extension of taxes for the
3    prior levy year occurs 30 days or less after the canvass of
4    the results of the referendum by the election authority in
5    any county in which the taxing district is located;
6        (D) in order for the limiting rate increase to be
7    first effective for the levy year prior to the levy year of
8    the referendum, the taxing district must certify its
9    election to have the limiting rate increase be effective
10    for the prior levy year to the clerk of each county in
11    which the taxing district is located not more than 2 days
12    after the date the results of the referendum are canvassed
13    by the election authority; and
14        (E) if the proposition provides for a limiting rate
15    increase, the increase may be effective regardless of
16    whether the proposition is approved before or after the
17    taxing district adopts or files its levy for any levy
18    year.
19    Rates required to extend taxes on levies subject to a
20backdoor referendum in each year there is a levy are not new
21rates or rate increases under this Section if a levy has been
22made for the fund in one or more of the preceding 3 levy years.
23Changes made by this amendatory Act of 1997 to this Section in
24reference to rates required to extend taxes on levies subject
25to a backdoor referendum in each year there is a levy are
26declarative of existing law and not a new enactment.

 

 

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1    (b) Whenever other applicable law authorizes a taxing
2district subject to the limitation with respect to its
3aggregate extension provided for in this Law to issue bonds or
4other obligations either without referendum or subject to
5backdoor referendum, the taxing district may elect for each
6separate bond issuance to submit the question of the issuance
7of the bonds or obligations directly to the voters of the
8taxing district, and if the referendum passes the taxing
9district is not required to comply with any backdoor
10referendum procedures or requirements set forth in the other
11applicable law. The direct referendum shall be initiated by
12ordinance or resolution of the governing body of the taxing
13district, and the question shall be certified to the proper
14election authorities in accordance with the provisions of the
15Election Code.
16(Source: P.A. 97-1087, eff. 8-24-12; 98-1088, eff. 8-26-14.)
 
17    Section 35-10. The School Code is amended by changing
18Section 17-3.2 as follows:
 
19    (105 ILCS 5/17-3.2)  (from Ch. 122, par. 17-3.2)
20    Sec. 17-3.2. Additional or supplemental budget.
21    (a) Whenever the voters of a school district have voted in
22favor of an increase in the annual tax rate for educational or
23operations and maintenance purposes or both at an election
24held after the adoption of the annual school budget for any

 

 

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1fiscal year, the board may adopt or pass during that fiscal
2year an additional or supplemental budget under the sole
3authority of this Section by a vote of a majority of the full
4membership of the board, any other provision of this Article
5to the contrary notwithstanding, in and by which such
6additional or supplemental budget the board shall appropriate
7such additional sums of money as it may find necessary to
8defray expenses and liabilities of that district to be
9incurred for educational or operations and maintenance
10purposes or both of the district during that fiscal year, but
11not in excess of the additional funds estimated to be
12available by virtue of such voted increase in the annual tax
13rate for educational or operations and maintenance purposes or
14both. Such additional or supplemental budget shall be regarded
15as an amendment of the annual school budget for the fiscal year
16in which it is adopted, and the board may levy the additional
17tax for educational or operations and maintenance purposes or
18both to equal the amount of the additional sums of money
19appropriated in that additional or supplemental budget,
20immediately.
21    (b) Notwithstanding any other provision of law, LaMoille
22Community Unit School District #303 may adopt an additional or
23supplemental budget in connection with an amended or
24supplemental levy adopted under Section 18-17 of the Property
25Tax Code without receiving the approval of the voters as
26provided in subsection (a). This subsection (b) is inoperative

 

 

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1on and after January 1, 2025.
2(Source: P.A. 86-1334.)
 
3
ARTICLE 40.

 
4    Section 40-1. Short title. This Act may be cited as the
5Local Journalism Sustainability Act. References in this
6Article to "this Act" mean this Article.
 
7    Section 40-5. Definitions.
8    "Award cycle" means the 4 reporting periods for which the
9employer is awarded a credit under Section 40-10.
10    "Comparable rate" has the meaning given to that term by
11the Federal Communications Commission in its campaign
12advertising rate rules.
13    "Department" means the Department of Commerce and Economic
14Opportunity.
15    "Independently owned" means, as applied to a local news
16organization, that:
17        (1) the local news organization is not a publicly
18    traded entity and no more than 5% of the beneficial
19    ownership of the local news organization is owned,
20    directly or indirectly, by a publicly traded entity; and
21        (2) the local news organization is not a subsidiary.
22    "Local news organization" means an entity that:
23        (1) engages professionals to create, edit, produce,

 

 

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1    and distribute original content concerning matters of
2    public interest through reporting activities, including
3    conducting interviews, observing current events, or
4    analyzing documents or other information;
5        (2) has at least one employee who meets all of the
6    following criteria:
7            (A) the employee is employed by the entity on a
8        full-time basis for at least 30 hours a week;
9            (B) the employee's job duties for the entity
10        consist primarily of providing coverage of Illinois or
11        local Illinois community news as described in
12        paragraph (C);
13            (C) the employee gathers, prepares, collects,
14        photographs, writes, edits, reports, or publishes
15        original local or State community news for
16        dissemination to the local or State community; and
17            (D) the employee lives within 50 miles of the
18        coverage area;
19        (3) in the case of a print publication, has published
20    at least one print publication per month over the previous
21    12 months and either (i) holds a valid United States
22    Postal Service periodical permit or (ii) has at least 25%
23    of its content dedicated to local news;
24        (4) in the case of a digital-only entity, has
25    published one piece about the community per week over the
26    previous 12 months and has at least 33% of its digital

 

 

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1    audience in Illinois, averaged over a 12-month period;
2        (5) in the case of a hybrid entity that has both print
3    and digital outlets, meets the requirements in either
4    paragraph (3) or (4) of this definition;
5        (6) has disclosed in its print publication or on its
6    website its beneficial ownership or, in the case of a
7    not-for-profit entity, its board of directors;
8        (7) in the case of an entity that maintains tax status
9    under Section 501(c)(3) of the federal Internal Revenue
10    Code, has declared the coverage of local or State news as
11    the stated mission in its filings with the Internal
12    Revenue Service;
13        (8) has not received any payments of more than 50% of
14    its gross receipts for the previous year from political
15    action committees or other entities described in Section
16    527 of the federal Internal Revenue Code or from an
17    organization that maintains Section 501(c)(4) or 501(c)(6)
18    status under the federal Internal Revenue Code, unless
19    those payments are for political advertising during the
20    lowest unit windows and using comparable rates; and
21        (9) has not received more than 30% of its revenue from
22    the previous taxable year from political advertisements
23    during lowest unit windows.
24    "Local news organization" does not include an organization
25that received more than $100,000 from organizations described
26in paragraph (8) during the taxable year or any preceding

 

 

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1taxable year.
2    "Lowest unit window" has the meaning given to that term by
3the Federal Communications Commission in its campaign
4advertising rate rules.
5    "New journalism position" means an employment position
6that results in a net increase in qualified journalists
7employed by the local news organization from January 1 of the
8preceding calendar year compared to January 1 of the calendar
9year in which a credit under this Act is sought.
10    "Private fund" means a corporation that:
11        (1) would be considered an investment company under
12    Section 3 of the Investment Company Act of 1940, 15 U.S.C.
13    80a-3, but for the application of paragraph (1) or (7) of
14    subsection (c) of that Section;
15        (2) is not a venture capital fund, as defined in
16    Section 275.203(l)-1 of Title 17 of the Code of Federal
17    Regulations, as in effect on the effective date of this
18    Act; and
19        (3) is not an institution selected under Section 107
20    of the federal Community Development Banking and Financial
21    Institutions Act of 1994.
22    "Qualified journalist" means a person who:
23        (1) is employed for an average of at least 30 hours per
24    week; and
25        (2) is responsible for gathering, developing,
26    preparing, directing the recording of, producing,

 

 

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1    collecting, photographing, recording, writing, editing,
2    reporting, designing, presenting, distributing, or
3    publishing original news or information that concerns
4    local matters of public interest.
5    "Reporting period" means the quarter for which a return is
6required to be filed under Article 7 of the Illinois Income Tax
7Act.
 
8    Section 40-10. Credit award. For reporting periods that
9begin on or after January 1, 2025 and before January 1, 2030,
10employers, including employers that maintain tax status under
11Section 501(c)(3) of the federal Internal Revenue Code, that
12are local news organizations and that are required to deduct
13and withhold taxes as provided in Article 7 of the Illinois
14Income Tax Act are eligible to receive a credit against
15payments due under Section 704A of the Illinois Income Tax
16Act. The credit shall be $15,000 per qualified journalist
17employed and paid by the employer during the 12-month period
18immediately preceding the date on which the employer applies
19for a credit under this Section. An additional credit of
20$10,000 shall be awarded against payments due under Section
21704A of the Illinois Income Tax Act for each qualified
22journalist who fills a new journalism position for the
23employer during the 12-month period immediately preceding the
24date on which the employer applies for a credit under this
25Section. No more than $150,000 in credits under this Act may be

 

 

10300HB4951sam002- 149 -LRB103 38094 HLH 74177 a

1awarded to any one local news organization in a single
2calendar year. If the local news organization is not
3independently owned or lists a private fund among its
4beneficial ownership, no more than $250,000 in credits may be
5awarded in a single calendar year to all local news
6organizations that share the same ownership interest. The
7total amount of credits that may be awarded under this Act in
8any given calendar year may not exceed $5,000,000, of which no
9more than $4,000,000 may be awarded for the $15,000 credit
10that applies to qualified journalists, and no more than
11$1,000,000 may be awarded for the additional $10,000 credit
12that is awarded for new journalism positions. Credits under
13this Section shall be awarded by the Department on a
14first-come, first-served basis.
15    The Department shall issue a credit certificate to each
16eligible local news organization. Upon issuance of the credit
17certificate, the Department shall inform the Department of
18Revenue, in the form and manner as agreed between the
19agencies, of the date the credit certificate was issued, the
20name and tax identification number of the recipient, the
21amount of the credit, and such other information as the
22Department of Revenue may require. The credit certificate
23shall be attached to the taxpayer's return.
24    The credit shall be applied to the first reporting period
25after the credit certificate is issued and that begins on or
26after January 1, 2025. If the amount of credit exceeds the

 

 

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1liability for the reporting period, the excess credit shall be
2refunded to the taxpayer.
 
3    Section 40-15. Application for local journalism
4certificate.
5    (a) In order to qualify for a tax credit award under this
6Act, an applicant must apply with the Department, in the form
7and manner required by the Department, for each award cycle
8for which a credit under this Act is sought, providing
9information necessary to calculate the tax credit award and
10any additional information as reasonably required by the
11Department. A separate application shall be filed for each
12local news organization. The tax credit award shall be
13calculated based upon the filing by the applicant on forms
14prescribed by the Department. The Department shall cooperate
15with the Department of Revenue as needed in order to determine
16credit amount and eligibility.
17     (b) Upon satisfactory review of the application, the
18Department shall issue a local journalism certificate stating
19the amount of the tax credit award to which the applicant is
20entitled for the credit period and shall contemporaneously
21notify the applicant and Department of Revenue upon issuance
22of the certificate.
 
23    Section 40-20. Powers of the Department. The Department
24and the Department of Revenue may, in consultation, adopt any

 

 

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1rules necessary to administer the provisions of this Act.
 
2    Section 40-25. Program terms and conditions. Any
3documentary materials or data made available or received from
4an applicant by any agent or employee of the Department are
5confidential and are not public records to the extent that the
6materials or data consist of commercial or financial
7information regarding the operation of, or the production of,
8the applicant or recipient of any tax credit award under this
9Act.
 
10    Section 40-900. The Illinois Income Tax Act is amended by
11changing Section 704A as follows:
 
12    (35 ILCS 5/704A)
13    Sec. 704A. Employer's return and payment of tax withheld.
14    (a) In general, every employer who deducts and withholds
15or is required to deduct and withhold tax under this Act on or
16after January 1, 2008 shall make those payments and returns as
17provided in this Section.
18    (b) Returns. Every employer shall, in the form and manner
19required by the Department, make returns with respect to taxes
20withheld or required to be withheld under this Article 7 for
21each quarter beginning on or after January 1, 2008, on or
22before the last day of the first month following the close of
23that quarter.

 

 

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1    (c) Payments. With respect to amounts withheld or required
2to be withheld on or after January 1, 2008:
3        (1) Semi-weekly payments. For each calendar year, each
4    employer who withheld or was required to withhold more
5    than $12,000 during the one-year period ending on June 30
6    of the immediately preceding calendar year, payment must
7    be made:
8            (A) on or before each Friday of the calendar year,
9        for taxes withheld or required to be withheld on the
10        immediately preceding Saturday, Sunday, Monday, or
11        Tuesday;
12            (B) on or before each Wednesday of the calendar
13        year, for taxes withheld or required to be withheld on
14        the immediately preceding Wednesday, Thursday, or
15        Friday.
16        Beginning with calendar year 2011, payments made under
17    this paragraph (1) of subsection (c) must be made by
18    electronic funds transfer.
19        (2) Semi-weekly payments. Any employer who withholds
20    or is required to withhold more than $12,000 in any
21    quarter of a calendar year is required to make payments on
22    the dates set forth under item (1) of this subsection (c)
23    for each remaining quarter of that calendar year and for
24    the subsequent calendar year.
25        (3) Monthly payments. Each employer, other than an
26    employer described in items (1) or (2) of this subsection,

 

 

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1    shall pay to the Department, on or before the 15th day of
2    each month the taxes withheld or required to be withheld
3    during the immediately preceding month.
4        (4) Payments with returns. Each employer shall pay to
5    the Department, on or before the due date for each return
6    required to be filed under this Section, any tax withheld
7    or required to be withheld during the period for which the
8    return is due and not previously paid to the Department.
9    (d) Regulatory authority. The Department may, by rule:
10        (1) Permit employers, in lieu of the requirements of
11    subsections (b) and (c), to file annual returns due on or
12    before January 31 of the year for taxes withheld or
13    required to be withheld during the previous calendar year
14    and, if the aggregate amounts required to be withheld by
15    the employer under this Article 7 (other than amounts
16    required to be withheld under Section 709.5) do not exceed
17    $1,000 for the previous calendar year, to pay the taxes
18    required to be shown on each such return no later than the
19    due date for such return.
20        (2) Provide that any payment required to be made under
21    subsection (c)(1) or (c)(2) is deemed to be timely to the
22    extent paid by electronic funds transfer on or before the
23    due date for deposit of federal income taxes withheld
24    from, or federal employment taxes due with respect to, the
25    wages from which the Illinois taxes were withheld.
26        (3) Designate one or more depositories to which

 

 

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1    payment of taxes required to be withheld under this
2    Article 7 must be paid by some or all employers.
3        (4) Increase the threshold dollar amounts at which
4    employers are required to make semi-weekly payments under
5    subsection (c)(1) or (c)(2).
6    (e) Annual return and payment. Every employer who deducts
7and withholds or is required to deduct and withhold tax from a
8person engaged in domestic service employment, as that term is
9defined in Section 3510 of the Internal Revenue Code, may
10comply with the requirements of this Section with respect to
11such employees by filing an annual return and paying the taxes
12required to be deducted and withheld on or before the 15th day
13of the fourth month following the close of the employer's
14taxable year. The Department may allow the employer's return
15to be submitted with the employer's individual income tax
16return or to be submitted with a return due from the employer
17under Section 1400.2 of the Unemployment Insurance Act.
18    (f) Magnetic media and electronic filing. With respect to
19taxes withheld in calendar years prior to 2017, any W-2 Form
20that, under the Internal Revenue Code and regulations
21promulgated thereunder, is required to be submitted to the
22Internal Revenue Service on magnetic media or electronically
23must also be submitted to the Department on magnetic media or
24electronically for Illinois purposes, if required by the
25Department.
26    With respect to taxes withheld in 2017 and subsequent

 

 

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1calendar years, the Department may, by rule, require that any
2return (including any amended return) under this Section and
3any W-2 Form that is required to be submitted to the Department
4must be submitted on magnetic media or electronically.
5    The due date for submitting W-2 Forms shall be as
6prescribed by the Department by rule.
7    (g) For amounts deducted or withheld after December 31,
82009, a taxpayer who makes an election under subsection (f) of
9Section 5-15 of the Economic Development for a Growing Economy
10Tax Credit Act for a taxable year shall be allowed a credit
11against payments due under this Section for amounts withheld
12during the first calendar year beginning after the end of that
13taxable year equal to the amount of the credit for the
14incremental income tax attributable to full-time employees of
15the taxpayer awarded to the taxpayer by the Department of
16Commerce and Economic Opportunity under the Economic
17Development for a Growing Economy Tax Credit Act for the
18taxable year and credits not previously claimed and allowed to
19be carried forward under Section 211(4) of this Act as
20provided in subsection (f) of Section 5-15 of the Economic
21Development for a Growing Economy Tax Credit Act. The credit
22or credits may not reduce the taxpayer's obligation for any
23payment due under this Section to less than zero. If the amount
24of the credit or credits exceeds the total payments due under
25this Section with respect to amounts withheld during the
26calendar year, the excess may be carried forward and applied

 

 

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1against the taxpayer's liability under this Section in the
2succeeding calendar years as allowed to be carried forward
3under paragraph (4) of Section 211 of this Act. The credit or
4credits shall be applied to the earliest year for which there
5is a tax liability. If there are credits from more than one
6taxable year that are available to offset a liability, the
7earlier credit shall be applied first. Each employer who
8deducts and withholds or is required to deduct and withhold
9tax under this Act and who retains income tax withholdings
10under subsection (f) of Section 5-15 of the Economic
11Development for a Growing Economy Tax Credit Act must make a
12return with respect to such taxes and retained amounts in the
13form and manner that the Department, by rule, requires and pay
14to the Department or to a depositary designated by the
15Department those withheld taxes not retained by the taxpayer.
16For purposes of this subsection (g), the term taxpayer shall
17include taxpayer and members of the taxpayer's unitary
18business group as defined under paragraph (27) of subsection
19(a) of Section 1501 of this Act. This Section is exempt from
20the provisions of Section 250 of this Act. No credit awarded
21under the Economic Development for a Growing Economy Tax
22Credit Act for agreements entered into on or after January 1,
232015 may be credited against payments due under this Section.
24    (g-1) For amounts deducted or withheld after December 31,
252024, a taxpayer who makes an election under the Reimagining
26Energy and Vehicles in Illinois Act shall be allowed a credit

 

 

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1against payments due under this Section for amounts withheld
2during the first quarterly reporting period beginning after
3the certificate is issued equal to the portion of the REV
4Illinois Credit attributable to the incremental income tax
5attributable to new employees and retained employees as
6certified by the Department of Commerce and Economic
7Opportunity pursuant to an agreement with the taxpayer under
8the Reimagining Energy and Vehicles in Illinois Act for the
9taxable year. The credit or credits may not reduce the
10taxpayer's obligation for any payment due under this Section
11to less than zero. If the amount of the credit or credits
12exceeds the total payments due under this Section with respect
13to amounts withheld during the quarterly reporting period, the
14excess may be carried forward and applied against the
15taxpayer's liability under this Section in the succeeding
16quarterly reporting period as allowed to be carried forward
17under paragraph (4) of Section 211 of this Act. The credit or
18credits shall be applied to the earliest quarterly reporting
19period for which there is a tax liability. If there are credits
20from more than one quarterly reporting period that are
21available to offset a liability, the earlier credit shall be
22applied first. Each employer who deducts and withholds or is
23required to deduct and withhold tax under this Act and who
24retains income tax withholdings this subsection must make a
25return with respect to such taxes and retained amounts in the
26form and manner that the Department, by rule, requires and pay

 

 

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1to the Department or to a depositary designated by the
2Department those withheld taxes not retained by the taxpayer.
3For purposes of this subsection (g-1), the term taxpayer shall
4include taxpayer and members of the taxpayer's unitary
5business group as defined under paragraph (27) of subsection
6(a) of Section 1501 of this Act. This Section is exempt from
7the provisions of Section 250 of this Act.
8    (g-2) For amounts deducted or withheld after December 31,
92024, a taxpayer who makes an election under the Manufacturing
10Illinois Chips for Real Opportunity (MICRO) Act shall be
11allowed a credit against payments due under this Section for
12amounts withheld during the first quarterly reporting period
13beginning after the certificate is issued equal to the portion
14of the MICRO Illinois Credit attributable to the incremental
15income tax attributable to new employees and retained
16employees as certified by the Department of Commerce and
17Economic Opportunity pursuant to an agreement with the
18taxpayer under the Manufacturing Illinois Chips for Real
19Opportunity (MICRO) Act for the taxable year. The credit or
20credits may not reduce the taxpayer's obligation for any
21payment due under this Section to less than zero. If the amount
22of the credit or credits exceeds the total payments due under
23this Section with respect to amounts withheld during the
24quarterly reporting period, the excess may be carried forward
25and applied against the taxpayer's liability under this
26Section in the succeeding quarterly reporting period as

 

 

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1allowed to be carried forward under paragraph (4) of Section
2211 of this Act. The credit or credits shall be applied to the
3earliest quarterly reporting period for which there is a tax
4liability. If there are credits from more than one quarterly
5reporting period that are available to offset a liability, the
6earlier credit shall be applied first. Each employer who
7deducts and withholds or is required to deduct and withhold
8tax under this Act and who retains income tax withholdings
9this subsection must make a return with respect to such taxes
10and retained amounts in the form and manner that the
11Department, by rule, requires and pay to the Department or to a
12depositary designated by the Department those withheld taxes
13not retained by the taxpayer. For purposes of this subsection,
14the term taxpayer shall include taxpayer and members of the
15taxpayer's unitary business group as defined under paragraph
16(27) of subsection (a) of Section 1501 of this Act. This
17Section is exempt from the provisions of Section 250 of this
18Act.
19    (h) An employer may claim a credit against payments due
20under this Section for amounts withheld during the first
21calendar year ending after the date on which a tax credit
22certificate was issued under Section 35 of the Small Business
23Job Creation Tax Credit Act. The credit shall be equal to the
24amount shown on the certificate, but may not reduce the
25taxpayer's obligation for any payment due under this Section
26to less than zero. If the amount of the credit exceeds the

 

 

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1total payments due under this Section with respect to amounts
2withheld during the calendar year, the excess may be carried
3forward and applied against the taxpayer's liability under
4this Section in the 5 succeeding calendar years. The credit
5shall be applied to the earliest year for which there is a tax
6liability. If there are credits from more than one calendar
7year that are available to offset a liability, the earlier
8credit shall be applied first. This Section is exempt from the
9provisions of Section 250 of this Act.
10    (i) Each employer with 50 or fewer full-time equivalent
11employees during the reporting period may claim a credit
12against the payments due under this Section for each qualified
13employee in an amount equal to the maximum credit allowable.
14The credit may be taken against payments due for reporting
15periods that begin on or after January 1, 2020, and end on or
16before December 31, 2027. An employer may not claim a credit
17for an employee who has worked fewer than 90 consecutive days
18immediately preceding the reporting period; however, such
19credits may accrue during that 90-day period and be claimed
20against payments under this Section for future reporting
21periods after the employee has worked for the employer at
22least 90 consecutive days. In no event may the credit exceed
23the employer's liability for the reporting period. Each
24employer who deducts and withholds or is required to deduct
25and withhold tax under this Act and who retains income tax
26withholdings under this subsection must make a return with

 

 

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1respect to such taxes and retained amounts in the form and
2manner that the Department, by rule, requires and pay to the
3Department or to a depositary designated by the Department
4those withheld taxes not retained by the employer.
5    For each reporting period, the employer may not claim a
6credit or credits for more employees than the number of
7employees making less than the minimum or reduced wage for the
8current calendar year during the last reporting period of the
9preceding calendar year. Notwithstanding any other provision
10of this subsection, an employer shall not be eligible for
11credits for a reporting period unless the average wage paid by
12the employer per employee for all employees making less than
13$55,000 during the reporting period is greater than the
14average wage paid by the employer per employee for all
15employees making less than $55,000 during the same reporting
16period of the prior calendar year.
17    For purposes of this subsection (i):
18    "Compensation paid in Illinois" has the meaning ascribed
19to that term under Section 304(a)(2)(B) of this Act.
20    "Employer" and "employee" have the meaning ascribed to
21those terms in the Minimum Wage Law, except that "employee"
22also includes employees who work for an employer with fewer
23than 4 employees. Employers that operate more than one
24establishment pursuant to a franchise agreement or that
25constitute members of a unitary business group shall aggregate
26their employees for purposes of determining eligibility for

 

 

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1the credit.
2    "Full-time equivalent employees" means the ratio of the
3number of paid hours during the reporting period and the
4number of working hours in that period.
5    "Maximum credit" means the percentage listed below of the
6difference between the amount of compensation paid in Illinois
7to employees who are paid not more than the required minimum
8wage reduced by the amount of compensation paid in Illinois to
9employees who were paid less than the current required minimum
10wage during the reporting period prior to each increase in the
11required minimum wage on January 1. If an employer pays an
12employee more than the required minimum wage and that employee
13previously earned less than the required minimum wage, the
14employer may include the portion that does not exceed the
15required minimum wage as compensation paid in Illinois to
16employees who are paid not more than the required minimum
17wage.
18        (1) 25% for reporting periods beginning on or after
19    January 1, 2020 and ending on or before December 31, 2020;
20        (2) 21% for reporting periods beginning on or after
21    January 1, 2021 and ending on or before December 31, 2021;
22        (3) 17% for reporting periods beginning on or after
23    January 1, 2022 and ending on or before December 31, 2022;
24        (4) 13% for reporting periods beginning on or after
25    January 1, 2023 and ending on or before December 31, 2023;
26        (5) 9% for reporting periods beginning on or after

 

 

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1    January 1, 2024 and ending on or before December 31, 2024;
2        (6) 5% for reporting periods beginning on or after
3    January 1, 2025 and ending on or before December 31, 2025.
4    The amount computed under this subsection may continue to
5be claimed for reporting periods beginning on or after January
61, 2026 and:
7        (A) ending on or before December 31, 2026 for
8    employers with more than 5 employees; or
9        (B) ending on or before December 31, 2027 for
10    employers with no more than 5 employees.
11    "Qualified employee" means an employee who is paid not
12more than the required minimum wage and has an average wage
13paid per hour by the employer during the reporting period
14equal to or greater than his or her average wage paid per hour
15by the employer during each reporting period for the
16immediately preceding 12 months. A new qualified employee is
17deemed to have earned the required minimum wage in the
18preceding reporting period.
19    "Reporting period" means the quarter for which a return is
20required to be filed under subsection (b) of this Section.
21    (j) For reporting periods beginning on or after January 1,
222023, if a private employer grants all of its employees the
23option of taking a paid leave of absence of at least 30 days
24for the purpose of serving as an organ donor or bone marrow
25donor, then the private employer may take a credit against the
26payments due under this Section in an amount equal to the

 

 

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1amount withheld under this Section with respect to wages paid
2while the employee is on organ donation leave, not to exceed
3$1,000 in withholdings for each employee who takes organ
4donation leave. To be eligible for the credit, such a leave of
5absence must be taken without loss of pay, vacation time,
6compensatory time, personal days, or sick time for at least
7the first 30 days of the leave of absence. The private employer
8shall adopt rules governing organ donation leave, including
9rules that (i) establish conditions and procedures for
10requesting and approving leave and (ii) require medical
11documentation of the proposed organ or bone marrow donation
12before leave is approved by the private employer. A private
13employer must provide, in the manner required by the
14Department, documentation from the employee's medical
15provider, which the private employer receives from the
16employee, that verifies the employee's organ donation. The
17private employer must also provide, in the manner required by
18the Department, documentation that shows that a qualifying
19organ donor leave policy was in place and offered to all
20qualifying employees at the time the leave was taken. For the
21private employer to receive the tax credit, the employee
22taking organ donor leave must allow for the applicable medical
23records to be disclosed to the Department. If the private
24employer cannot provide the required documentation to the
25Department, then the private employer is ineligible for the
26credit under this Section. A private employer must also

 

 

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1provide, in the form required by the Department, any
2additional documentation or information required by the
3Department to administer the credit under this Section. The
4credit under this subsection (j) shall be taken within one
5year after the date upon which the organ donation leave
6begins. If the leave taken spans into a second tax year, the
7employer qualifies for the allowable credit in the later of
8the 2 years. If the amount of credit exceeds the tax liability
9for the year, the excess may be carried and applied to the tax
10liability for the 3 taxable years following the excess credit
11year. The tax credit shall be applied to the earliest year for
12which there is a tax liability. If there are credits for more
13than one year that are available to offset liability, the
14earlier credit shall be applied first.
15    Nothing in this subsection (j) prohibits a private
16employer from providing an unpaid leave of absence to its
17employees for the purpose of serving as an organ donor or bone
18marrow donor; however, if the employer's policy provides for
19fewer than 30 days of paid leave for organ or bone marrow
20donation, then the employer shall not be eligible for the
21credit under this Section.
22    As used in this subsection (j):
23    "Organ" means any biological tissue of the human body that
24may be donated by a living donor, including, but not limited
25to, the kidney, liver, lung, pancreas, intestine, bone, skin,
26or any subpart of those organs.

 

 

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1    "Organ donor" means a person from whose body an organ is
2taken to be transferred to the body of another person.
3    "Private employer" means a sole proprietorship,
4corporation, partnership, limited liability company, or other
5entity with one or more employees. "Private employer" does not
6include a municipality, county, State agency, or other public
7employer.
8    This subsection (j) is exempt from the provisions of
9Section 250 of this Act.
10    (k) A taxpayer who is issued a certificate under the Local
11Journalism Sustainability Act for a taxable year shall be
12allowed a credit against payments due under this Section as
13provided in that Act.
14(Source: P.A. 101-1, eff. 2-19-19; 102-669, eff. 11-16-21;
15102-700, Article 30, Section 30-5, eff. 4-19-22; 102-700,
16Article 110, Section 110-905, eff. 4-19-22; 102-1125, eff.
172-3-23.)
 
18
ARTICLE 45.

 
19    Section 45-5. The Live Theater Production Tax Credit Act
20is amended by changing Sections 10-10, 10-20, and 10-40 as
21follows:
 
22    (35 ILCS 17/10-10)
23    Sec. 10-10. Definitions. As used in this Act:

 

 

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1    "Accredited theater production" means a for-profit live
2stage presentation in a qualified production facility, as
3defined in this Section, that is either (i) a pre-Broadway
4production or (ii) a long-run production for which the
5aggregate Illinois labor and marketing expenditures exceed
6$100,000. For credits awarded under this Act on or after July
71, 2022 in State Fiscal Year 2023, "accredited theater
8production" also includes any commercial Broadway touring
9show. For credits awarded under this Act on or after July 1,
102024, "accredited theater production" also includes non-profit
11theater productions.
12    "Commercial Broadway touring show" means a production that
13(i) is performed in a qualified production facility and plays
14in more than 2 other markets in North America outside of
15Illinois within 12 months of its Illinois presentation and
16(ii) has Illinois production spending of not less than
17$100,000, as shown on the applicant's application for the
18credit.
19    "Pre-Broadway production" means a live stage production
20that, (i) in its original or adaptive version, is performed in
21a qualified production facility with the goal of having a
22presentation scheduled for Broadway's Theater District in New
23York City within 12 months after its Illinois presentation and
24(ii) has Illinois production spending of not less than
25$100,000, as shown on the applicant's application for the
26credit.

 

 

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1    "Long-run production" means a live stage production that
2is performed in a qualified production facility for longer
3than 8 weeks, with at least 6 performances per week, and
4includes a production that spans the end of one tax year and
5the commencement of a new tax year that, in combination, meets
6the criteria set forth in this definition making it a long-run
7production eligible for a theater tax credit award in each tax
8year or portion thereof.
9    "Non-profit theater production" means a live stage
10production that is at least 75 minutes in length with a written
11script that (i) is produced by a 501(c)3 non-profit registered
12in the State of Illinois for at least 5 years, (ii) has
13Illinois production spending of not less than $10,000, as
14shown on the applicant's application for the credit, and (iii)
15has a minimum annual operating budget of $25,000 or more, as
16shown on the applicant's application for the credit.
17    "Accredited theater production certificate" means a
18certificate issued by the Department certifying that the
19production is an accredited theater production that meets the
20guidelines of this Act.
21    "Applicant" means a taxpayer that is a theater producer,
22owner, licensee, operator, or presenter that is presenting or
23has presented a live stage presentation located within the
24State of Illinois who:
25        (1) owns or licenses the theatrical rights of the
26    stage presentation for the Illinois production period; or

 

 

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1        (2) has contracted or will contract directly with the
2    owner or licensee of the theatrical rights or a person
3    acting on behalf of the owner or licensee to provide live
4    performances of the production.
5    An applicant that directly or indirectly owns, controls,
6or operates multiple qualified production facilities shall be
7presumed to be and considered for the purposes of this Act to
8be a single applicant; provided, however, that as to each of
9the applicant's qualified production facilities, the applicant
10shall be eligible to separately and contemporaneously (i)
11apply for and obtain accredited theater production
12certificates, (ii) stage accredited theater productions, and
13(iii) apply for and receive a tax credit award certificate for
14each of the applicant's accredited theater productions
15performed at each of the applicant's qualified production
16facilities.
17    "Department" means the Department of Commerce and Economic
18Opportunity.
19    "Director" means the Director of the Department.
20    "Illinois labor expenditure" means gross salary or wages
21including, but not limited to, taxes, benefits, and any other
22consideration incurred or paid to non-talent employees of the
23applicant for services rendered to and on behalf of the
24accredited theater production. To qualify as an Illinois labor
25expenditure, the expenditure must be:
26        (1) incurred or paid by the applicant on or after the

 

 

10300HB4951sam002- 170 -LRB103 38094 HLH 74177 a

1    effective date of the Act for services related to any
2    portion of an accredited theater production from its
3    pre-production stages, including, but not limited to, the
4    writing of the script, casting, hiring of service
5    providers, purchases from vendors, marketing, advertising,
6    public relations, load in, rehearsals, performances, other
7    accredited theater production related activities, and load
8    out;
9        (2) directly attributable to the accredited theater
10    production;
11        (3) limited to the first $100,000 of wages incurred or
12    paid to each employee of an accredited theater production
13    in each tax year;
14        (4) included in the federal income tax basis of the
15    property;
16        (5) paid in the tax year for which the applicant is
17    claiming the tax credit award, or no later than 60 days
18    after the end of the tax year;
19        (6) paid to persons residing in Illinois at the time
20    payments were made; and
21        (7) reasonable in the circumstances.
22    "Illinois production spending" means any and all expenses
23directly or indirectly incurred relating to an accredited
24theater production presented in any qualified production
25facility of the applicant, including, but not limited to,
26expenditures for:

 

 

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1        (1) national marketing, public relations, and the
2    creation and placement of print, electronic, television,
3    billboard, and other forms of advertising; and
4        (2) the construction and fabrication of scenic
5    materials and elements; provided, however, that the
6    maximum amount of expenditures attributable to the
7    construction and fabrication of scenic materials and
8    elements eligible for a tax credit award shall not exceed
9    $500,000 per applicant per production in any single tax
10    year.
11    "Qualified production facility" means a facility located
12in the State in which live theatrical productions are, or are
13intended to be, exclusively presented that contains at least
14one stage, a seating capacity of 1,200 or more seats or, if the
15live theater production is a non-profit theater production, a
16seating capacity of 50 or more seats, and dressing rooms,
17storage areas, and other ancillary amenities necessary for the
18accredited theater production.
19    "Tax credit award" means the issuance to a taxpayer by the
20Department of a tax credit award in conformance with Sections
2110-40 and 10-45 of this Act.
22    "Tax year" means a calendar year for the period January 1
23to and including December 31.
24(Source: P.A. 102-1112, eff. 12-21-22.)
 
25    (35 ILCS 17/10-20)

 

 

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1    Sec. 10-20. Tax credit award. Subject to the conditions
2set forth in this Act, an applicant is entitled to a tax credit
3award as approved by the Department for qualifying Illinois
4labor expenditures and Illinois production spending for each
5tax year in which the applicant is awarded an accredited
6theater production certificate issued by the Department. The
7amount of tax credits awarded pursuant to this Act shall not
8exceed $2,000,000 in any State fiscal year ending on or before
9June 30, 2022. The , except that the amount of tax credits
10awarded pursuant to this Act for the State fiscal year ending
11on June 30, 2023 or the State fiscal year ending on June 30,
122024 shall not exceed $4,000,000. For the State fiscal year
13ending on June 30, 2023 and the State fiscal year ending on
14June 30, 2024, no more than $2,000,000 in credits may be
15awarded in either of those fiscal years to accredited theater
16productions that are not commercial Broadway touring shows,
17and no more than $2,000,000 in credits may be awarded in either
18of those fiscal years to commercial Broadway touring shows.
19For State fiscal years ending on or after June 30, 2025, the
20amount of tax credits awarded under this Act shall not exceed
21$6,000,000, with no more than $2,000,000 in credits awarded
22for long-run productions and pre-Broadway productions, no more
23than $2,000,000 in credits awarded for commercial Broadway
24touring shows, and no more than $2,000,000 in credits awarded
25for non-profit theater productions. In the case of credits
26awarded under this Act for non-profit theater productions, no

 

 

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1more than $100,000 in credits may be awarded to any single
2non-profit theater production. Credits shall be awarded on a
3first-come, first-served basis. Notwithstanding the foregoing,
4if the amount of credits applied for in any fiscal year exceeds
5the amount authorized to be awarded under this Section, the
6excess credit amount shall be awarded in the next fiscal year
7in which credits remain available for award and shall be
8treated as having been applied for on the first day of that
9fiscal year.
10(Source: P.A. 102-700, eff. 4-19-22; 102-1112, eff. 12-21-22.)
 
11    (35 ILCS 17/10-40)
12    Sec. 10-40. Issuance of Tax Credit Award Certificate.
13    (a) In order to qualify for a tax credit award under this
14Act, an applicant must file an application for each accredited
15theater production at each of the applicant's qualified
16production facilities, on forms prescribed by the Department,
17providing information necessary to calculate the tax credit
18award and any additional information as reasonably required by
19the Department.
20    (b) Upon satisfactory review of the application, the
21Department shall issue a tax credit award certificate stating
22the amount of the tax credit award to which the applicant is
23entitled for that tax year and shall contemporaneously notify
24the applicant and Illinois Department of Revenue in accordance
25with Section 222 of the Illinois Income Tax Act or, if the

 

 

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1applicant is a nonprofit theater production, subsection (k) of
2Section 704A of the Illinois Income Tax Act, as applicable.
3(Source: P.A. 97-636, eff. 6-1-12.)
 
4    Section 45-10. The Illinois Income Tax Act is amended by
5changing Sections 222 and 704A as follows:
 
6    (35 ILCS 5/222)
7    Sec. 222. Live theater production credit.
8    (a) For tax years beginning on or after January 1, 2012 and
9beginning prior to January 1, 2027, a taxpayer who has
10received a tax credit award under the Live Theater Production
11Tax Credit Act for a long-run production, a pre-Broadway
12production, or a commercial Broadway touring show is entitled
13to a credit against the taxes imposed under subsections (a)
14and (b) of Section 201 of this Act in an amount determined
15under that Act by the Department of Commerce and Economic
16Opportunity.
17    (b) For taxable years ending before December 31, 2023, if
18the taxpayer is a partnership, limited liability partnership,
19limited liability company, or Subchapter S corporation, the
20tax credit award is allowed to the partners, unit holders, or
21shareholders in accordance with the determination of income
22and distributive share of income under Sections 702 and 704
23and Subchapter S of the Internal Revenue Code. For taxable
24years ending on or after December 31, 2023, if the taxpayer is

 

 

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1a partnership or Subchapter S corporation, then the provisions
2of Section 251 apply.
3    (c) A sale, assignment, or transfer of the tax credit
4award may be made by the taxpayer earning the credit within one
5year after the credit is awarded in accordance with rules
6adopted by the Department of Commerce and Economic
7Opportunity.
8    (d) The Department of Revenue, in cooperation with the
9Department of Commerce and Economic Opportunity, shall adopt
10rules to enforce and administer the provisions of this
11Section.
12    (e) The tax credit award may not be carried back. If the
13amount of the credit exceeds the tax liability for the year,
14the excess may be carried forward and applied to the tax
15liability of the 5 tax years following the excess credit year.
16The tax credit award shall be applied to the earliest year for
17which there is a tax liability. If there are credits from more
18than one tax year that are available to offset liability, the
19earlier credit shall be applied first. In no event may a credit
20under this Section reduce the taxpayer's liability to less
21than zero.
22(Source: P.A. 102-16, eff. 6-17-21; 103-396, eff. 1-1-24.)
 
23    (35 ILCS 5/704A)
24    Sec. 704A. Employer's return and payment of tax withheld.
25    (a) In general, every employer who deducts and withholds

 

 

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1or is required to deduct and withhold tax under this Act on or
2after January 1, 2008 shall make those payments and returns as
3provided in this Section.
4    (b) Returns. Every employer shall, in the form and manner
5required by the Department, make returns with respect to taxes
6withheld or required to be withheld under this Article 7 for
7each quarter beginning on or after January 1, 2008, on or
8before the last day of the first month following the close of
9that quarter.
10    (c) Payments. With respect to amounts withheld or required
11to be withheld on or after January 1, 2008:
12        (1) Semi-weekly payments. For each calendar year, each
13    employer who withheld or was required to withhold more
14    than $12,000 during the one-year period ending on June 30
15    of the immediately preceding calendar year, payment must
16    be made:
17            (A) on or before each Friday of the calendar year,
18        for taxes withheld or required to be withheld on the
19        immediately preceding Saturday, Sunday, Monday, or
20        Tuesday;
21            (B) on or before each Wednesday of the calendar
22        year, for taxes withheld or required to be withheld on
23        the immediately preceding Wednesday, Thursday, or
24        Friday.
25        Beginning with calendar year 2011, payments made under
26    this paragraph (1) of subsection (c) must be made by

 

 

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1    electronic funds transfer.
2        (2) Semi-weekly payments. Any employer who withholds
3    or is required to withhold more than $12,000 in any
4    quarter of a calendar year is required to make payments on
5    the dates set forth under item (1) of this subsection (c)
6    for each remaining quarter of that calendar year and for
7    the subsequent calendar year.
8        (3) Monthly payments. Each employer, other than an
9    employer described in items (1) or (2) of this subsection,
10    shall pay to the Department, on or before the 15th day of
11    each month the taxes withheld or required to be withheld
12    during the immediately preceding month.
13        (4) Payments with returns. Each employer shall pay to
14    the Department, on or before the due date for each return
15    required to be filed under this Section, any tax withheld
16    or required to be withheld during the period for which the
17    return is due and not previously paid to the Department.
18    (d) Regulatory authority. The Department may, by rule:
19        (1) Permit employers, in lieu of the requirements of
20    subsections (b) and (c), to file annual returns due on or
21    before January 31 of the year for taxes withheld or
22    required to be withheld during the previous calendar year
23    and, if the aggregate amounts required to be withheld by
24    the employer under this Article 7 (other than amounts
25    required to be withheld under Section 709.5) do not exceed
26    $1,000 for the previous calendar year, to pay the taxes

 

 

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1    required to be shown on each such return no later than the
2    due date for such return.
3        (2) Provide that any payment required to be made under
4    subsection (c)(1) or (c)(2) is deemed to be timely to the
5    extent paid by electronic funds transfer on or before the
6    due date for deposit of federal income taxes withheld
7    from, or federal employment taxes due with respect to, the
8    wages from which the Illinois taxes were withheld.
9        (3) Designate one or more depositories to which
10    payment of taxes required to be withheld under this
11    Article 7 must be paid by some or all employers.
12        (4) Increase the threshold dollar amounts at which
13    employers are required to make semi-weekly payments under
14    subsection (c)(1) or (c)(2).
15    (e) Annual return and payment. Every employer who deducts
16and withholds or is required to deduct and withhold tax from a
17person engaged in domestic service employment, as that term is
18defined in Section 3510 of the Internal Revenue Code, may
19comply with the requirements of this Section with respect to
20such employees by filing an annual return and paying the taxes
21required to be deducted and withheld on or before the 15th day
22of the fourth month following the close of the employer's
23taxable year. The Department may allow the employer's return
24to be submitted with the employer's individual income tax
25return or to be submitted with a return due from the employer
26under Section 1400.2 of the Unemployment Insurance Act.

 

 

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1    (f) Magnetic media and electronic filing. With respect to
2taxes withheld in calendar years prior to 2017, any W-2 Form
3that, under the Internal Revenue Code and regulations
4promulgated thereunder, is required to be submitted to the
5Internal Revenue Service on magnetic media or electronically
6must also be submitted to the Department on magnetic media or
7electronically for Illinois purposes, if required by the
8Department.
9    With respect to taxes withheld in 2017 and subsequent
10calendar years, the Department may, by rule, require that any
11return (including any amended return) under this Section and
12any W-2 Form that is required to be submitted to the Department
13must be submitted on magnetic media or electronically.
14    The due date for submitting W-2 Forms shall be as
15prescribed by the Department by rule.
16    (g) For amounts deducted or withheld after December 31,
172009, a taxpayer who makes an election under subsection (f) of
18Section 5-15 of the Economic Development for a Growing Economy
19Tax Credit Act for a taxable year shall be allowed a credit
20against payments due under this Section for amounts withheld
21during the first calendar year beginning after the end of that
22taxable year equal to the amount of the credit for the
23incremental income tax attributable to full-time employees of
24the taxpayer awarded to the taxpayer by the Department of
25Commerce and Economic Opportunity under the Economic
26Development for a Growing Economy Tax Credit Act for the

 

 

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1taxable year and credits not previously claimed and allowed to
2be carried forward under Section 211(4) of this Act as
3provided in subsection (f) of Section 5-15 of the Economic
4Development for a Growing Economy Tax Credit Act. The credit
5or credits may not reduce the taxpayer's obligation for any
6payment due under this Section to less than zero. If the amount
7of the credit or credits exceeds the total payments due under
8this Section with respect to amounts withheld during the
9calendar year, the excess may be carried forward and applied
10against the taxpayer's liability under this Section in the
11succeeding calendar years as allowed to be carried forward
12under paragraph (4) of Section 211 of this Act. The credit or
13credits shall be applied to the earliest year for which there
14is a tax liability. If there are credits from more than one
15taxable year that are available to offset a liability, the
16earlier credit shall be applied first. Each employer who
17deducts and withholds or is required to deduct and withhold
18tax under this Act and who retains income tax withholdings
19under subsection (f) of Section 5-15 of the Economic
20Development for a Growing Economy Tax Credit Act must make a
21return with respect to such taxes and retained amounts in the
22form and manner that the Department, by rule, requires and pay
23to the Department or to a depositary designated by the
24Department those withheld taxes not retained by the taxpayer.
25For purposes of this subsection (g), the term taxpayer shall
26include taxpayer and members of the taxpayer's unitary

 

 

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1business group as defined under paragraph (27) of subsection
2(a) of Section 1501 of this Act. This Section is exempt from
3the provisions of Section 250 of this Act. No credit awarded
4under the Economic Development for a Growing Economy Tax
5Credit Act for agreements entered into on or after January 1,
62015 may be credited against payments due under this Section.
7    (g-1) For amounts deducted or withheld after December 31,
82024, a taxpayer who makes an election under the Reimagining
9Energy and Vehicles in Illinois Act shall be allowed a credit
10against payments due under this Section for amounts withheld
11during the first quarterly reporting period beginning after
12the certificate is issued equal to the portion of the REV
13Illinois Credit attributable to the incremental income tax
14attributable to new employees and retained employees as
15certified by the Department of Commerce and Economic
16Opportunity pursuant to an agreement with the taxpayer under
17the Reimagining Energy and Vehicles in Illinois Act for the
18taxable year. The credit or credits may not reduce the
19taxpayer's obligation for any payment due under this Section
20to less than zero. If the amount of the credit or credits
21exceeds the total payments due under this Section with respect
22to amounts withheld during the quarterly reporting period, the
23excess may be carried forward and applied against the
24taxpayer's liability under this Section in the succeeding
25quarterly reporting period as allowed to be carried forward
26under paragraph (4) of Section 211 of this Act. The credit or

 

 

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1credits shall be applied to the earliest quarterly reporting
2period for which there is a tax liability. If there are credits
3from more than one quarterly reporting period that are
4available to offset a liability, the earlier credit shall be
5applied first. Each employer who deducts and withholds or is
6required to deduct and withhold tax under this Act and who
7retains income tax withholdings this subsection must make a
8return with respect to such taxes and retained amounts in the
9form and manner that the Department, by rule, requires and pay
10to the Department or to a depositary designated by the
11Department those withheld taxes not retained by the taxpayer.
12For purposes of this subsection (g-1), the term taxpayer shall
13include taxpayer and members of the taxpayer's unitary
14business group as defined under paragraph (27) of subsection
15(a) of Section 1501 of this Act. This Section is exempt from
16the provisions of Section 250 of this Act.
17    (g-2) For amounts deducted or withheld after December 31,
182024, a taxpayer who makes an election under the Manufacturing
19Illinois Chips for Real Opportunity (MICRO) Act shall be
20allowed a credit against payments due under this Section for
21amounts withheld during the first quarterly reporting period
22beginning after the certificate is issued equal to the portion
23of the MICRO Illinois Credit attributable to the incremental
24income tax attributable to new employees and retained
25employees as certified by the Department of Commerce and
26Economic Opportunity pursuant to an agreement with the

 

 

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1taxpayer under the Manufacturing Illinois Chips for Real
2Opportunity (MICRO) Act for the taxable year. The credit or
3credits may not reduce the taxpayer's obligation for any
4payment due under this Section to less than zero. If the amount
5of the credit or credits exceeds the total payments due under
6this Section with respect to amounts withheld during the
7quarterly reporting period, the excess may be carried forward
8and applied against the taxpayer's liability under this
9Section in the succeeding quarterly reporting period as
10allowed to be carried forward under paragraph (4) of Section
11211 of this Act. The credit or credits shall be applied to the
12earliest quarterly reporting period for which there is a tax
13liability. If there are credits from more than one quarterly
14reporting period that are available to offset a liability, the
15earlier credit shall be applied first. Each employer who
16deducts and withholds or is required to deduct and withhold
17tax under this Act and who retains income tax withholdings
18this subsection must make a return with respect to such taxes
19and retained amounts in the form and manner that the
20Department, by rule, requires and pay to the Department or to a
21depositary designated by the Department those withheld taxes
22not retained by the taxpayer. For purposes of this subsection,
23the term taxpayer shall include taxpayer and members of the
24taxpayer's unitary business group as defined under paragraph
25(27) of subsection (a) of Section 1501 of this Act. This
26Section is exempt from the provisions of Section 250 of this

 

 

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1Act.
2    (h) An employer may claim a credit against payments due
3under this Section for amounts withheld during the first
4calendar year ending after the date on which a tax credit
5certificate was issued under Section 35 of the Small Business
6Job Creation Tax Credit Act. The credit shall be equal to the
7amount shown on the certificate, but may not reduce the
8taxpayer's obligation for any payment due under this Section
9to less than zero. If the amount of the credit exceeds the
10total payments due under this Section with respect to amounts
11withheld during the calendar year, the excess may be carried
12forward and applied against the taxpayer's liability under
13this Section in the 5 succeeding calendar years. The credit
14shall be applied to the earliest year for which there is a tax
15liability. If there are credits from more than one calendar
16year that are available to offset a liability, the earlier
17credit shall be applied first. This Section is exempt from the
18provisions of Section 250 of this Act.
19    (i) Each employer with 50 or fewer full-time equivalent
20employees during the reporting period may claim a credit
21against the payments due under this Section for each qualified
22employee in an amount equal to the maximum credit allowable.
23The credit may be taken against payments due for reporting
24periods that begin on or after January 1, 2020, and end on or
25before December 31, 2027. An employer may not claim a credit
26for an employee who has worked fewer than 90 consecutive days

 

 

10300HB4951sam002- 185 -LRB103 38094 HLH 74177 a

1immediately preceding the reporting period; however, such
2credits may accrue during that 90-day period and be claimed
3against payments under this Section for future reporting
4periods after the employee has worked for the employer at
5least 90 consecutive days. In no event may the credit exceed
6the employer's liability for the reporting period. Each
7employer who deducts and withholds or is required to deduct
8and withhold tax under this Act and who retains income tax
9withholdings under this subsection must make a return with
10respect to such taxes and retained amounts in the form and
11manner that the Department, by rule, requires and pay to the
12Department or to a depositary designated by the Department
13those withheld taxes not retained by the employer.
14    For each reporting period, the employer may not claim a
15credit or credits for more employees than the number of
16employees making less than the minimum or reduced wage for the
17current calendar year during the last reporting period of the
18preceding calendar year. Notwithstanding any other provision
19of this subsection, an employer shall not be eligible for
20credits for a reporting period unless the average wage paid by
21the employer per employee for all employees making less than
22$55,000 during the reporting period is greater than the
23average wage paid by the employer per employee for all
24employees making less than $55,000 during the same reporting
25period of the prior calendar year.
26    For purposes of this subsection (i):

 

 

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1    "Compensation paid in Illinois" has the meaning ascribed
2to that term under Section 304(a)(2)(B) of this Act.
3    "Employer" and "employee" have the meaning ascribed to
4those terms in the Minimum Wage Law, except that "employee"
5also includes employees who work for an employer with fewer
6than 4 employees. Employers that operate more than one
7establishment pursuant to a franchise agreement or that
8constitute members of a unitary business group shall aggregate
9their employees for purposes of determining eligibility for
10the credit.
11    "Full-time equivalent employees" means the ratio of the
12number of paid hours during the reporting period and the
13number of working hours in that period.
14    "Maximum credit" means the percentage listed below of the
15difference between the amount of compensation paid in Illinois
16to employees who are paid not more than the required minimum
17wage reduced by the amount of compensation paid in Illinois to
18employees who were paid less than the current required minimum
19wage during the reporting period prior to each increase in the
20required minimum wage on January 1. If an employer pays an
21employee more than the required minimum wage and that employee
22previously earned less than the required minimum wage, the
23employer may include the portion that does not exceed the
24required minimum wage as compensation paid in Illinois to
25employees who are paid not more than the required minimum
26wage.

 

 

10300HB4951sam002- 187 -LRB103 38094 HLH 74177 a

1        (1) 25% for reporting periods beginning on or after
2    January 1, 2020 and ending on or before December 31, 2020;
3        (2) 21% for reporting periods beginning on or after
4    January 1, 2021 and ending on or before December 31, 2021;
5        (3) 17% for reporting periods beginning on or after
6    January 1, 2022 and ending on or before December 31, 2022;
7        (4) 13% for reporting periods beginning on or after
8    January 1, 2023 and ending on or before December 31, 2023;
9        (5) 9% for reporting periods beginning on or after
10    January 1, 2024 and ending on or before December 31, 2024;
11        (6) 5% for reporting periods beginning on or after
12    January 1, 2025 and ending on or before December 31, 2025.
13    The amount computed under this subsection may continue to
14be claimed for reporting periods beginning on or after January
151, 2026 and:
16        (A) ending on or before December 31, 2026 for
17    employers with more than 5 employees; or
18        (B) ending on or before December 31, 2027 for
19    employers with no more than 5 employees.
20    "Qualified employee" means an employee who is paid not
21more than the required minimum wage and has an average wage
22paid per hour by the employer during the reporting period
23equal to or greater than his or her average wage paid per hour
24by the employer during each reporting period for the
25immediately preceding 12 months. A new qualified employee is
26deemed to have earned the required minimum wage in the

 

 

10300HB4951sam002- 188 -LRB103 38094 HLH 74177 a

1preceding reporting period.
2    "Reporting period" means the quarter for which a return is
3required to be filed under subsection (b) of this Section.
4    (j) For reporting periods beginning on or after January 1,
52023, if a private employer grants all of its employees the
6option of taking a paid leave of absence of at least 30 days
7for the purpose of serving as an organ donor or bone marrow
8donor, then the private employer may take a credit against the
9payments due under this Section in an amount equal to the
10amount withheld under this Section with respect to wages paid
11while the employee is on organ donation leave, not to exceed
12$1,000 in withholdings for each employee who takes organ
13donation leave. To be eligible for the credit, such a leave of
14absence must be taken without loss of pay, vacation time,
15compensatory time, personal days, or sick time for at least
16the first 30 days of the leave of absence. The private employer
17shall adopt rules governing organ donation leave, including
18rules that (i) establish conditions and procedures for
19requesting and approving leave and (ii) require medical
20documentation of the proposed organ or bone marrow donation
21before leave is approved by the private employer. A private
22employer must provide, in the manner required by the
23Department, documentation from the employee's medical
24provider, which the private employer receives from the
25employee, that verifies the employee's organ donation. The
26private employer must also provide, in the manner required by

 

 

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1the Department, documentation that shows that a qualifying
2organ donor leave policy was in place and offered to all
3qualifying employees at the time the leave was taken. For the
4private employer to receive the tax credit, the employee
5taking organ donor leave must allow for the applicable medical
6records to be disclosed to the Department. If the private
7employer cannot provide the required documentation to the
8Department, then the private employer is ineligible for the
9credit under this Section. A private employer must also
10provide, in the form required by the Department, any
11additional documentation or information required by the
12Department to administer the credit under this Section. The
13credit under this subsection (j) shall be taken within one
14year after the date upon which the organ donation leave
15begins. If the leave taken spans into a second tax year, the
16employer qualifies for the allowable credit in the later of
17the 2 years. If the amount of credit exceeds the tax liability
18for the year, the excess may be carried and applied to the tax
19liability for the 3 taxable years following the excess credit
20year. The tax credit shall be applied to the earliest year for
21which there is a tax liability. If there are credits for more
22than one year that are available to offset liability, the
23earlier credit shall be applied first.
24    Nothing in this subsection (j) prohibits a private
25employer from providing an unpaid leave of absence to its
26employees for the purpose of serving as an organ donor or bone

 

 

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1marrow donor; however, if the employer's policy provides for
2fewer than 30 days of paid leave for organ or bone marrow
3donation, then the employer shall not be eligible for the
4credit under this Section.
5    As used in this subsection (j):
6    "Organ" means any biological tissue of the human body that
7may be donated by a living donor, including, but not limited
8to, the kidney, liver, lung, pancreas, intestine, bone, skin,
9or any subpart of those organs.
10    "Organ donor" means a person from whose body an organ is
11taken to be transferred to the body of another person.
12    "Private employer" means a sole proprietorship,
13corporation, partnership, limited liability company, or other
14entity with one or more employees. "Private employer" does not
15include a municipality, county, State agency, or other public
16employer.
17    This subsection (j) is exempt from the provisions of
18Section 250 of this Act.
19    (k) For reporting periods beginning on or after January 1,
202025 and before January 1, 2027, an employer may claim a credit
21against payments due under this Section for amounts withheld
22during the first reporting period to occur after the date on
23which a tax credit certificate is issued for a non-profit
24theater production under Section 10 of the Live Theater
25Production Tax Credit Act. The credit shall be equal to the
26amount shown on the certificate, but may not reduce the

 

 

10300HB4951sam002- 191 -LRB103 38094 HLH 74177 a

1taxpayer's obligation for any payment due under this Article
2to less than zero. If the amount of the credit exceeds the
3total amount due under this Article with respect to amounts
4withheld during the first reporting period to occur after the
5date on which a tax credit certificate is issued, the excess
6may be carried forward and applied against the taxpayer's
7liability under this Section for reporting periods that occur
8in the 5 succeeding calendar years. The excess credit shall be
9applied to the earliest reporting period for which there is a
10payment due under this Article. If there are credits from more
11than one reporting period that are available to offset a
12liability, the earlier credit shall be applied first. The
13Department of Revenue, in cooperation with the Department of
14Commerce and Economic Opportunity, shall adopt rules to
15enforce and administer the provisions of this subsection.
16(Source: P.A. 101-1, eff. 2-19-19; 102-669, eff. 11-16-21;
17102-700, Article 30, Section 30-5, eff. 4-19-22; 102-700,
18Article 110, Section 110-905, eff. 4-19-22; 102-1125, eff.
192-3-23.)
 
20
ARTICLE 50.

 
21    Section 50-1. Short title. This Act may be cited as the
22Music and Musicians Tax Credit and Jobs Act. References in
23this Article to "this Act" mean this Article.
 

 

 

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1    Section 50-5. Purpose. The State's economy depends heavily
2on music, professional musicians, music teachers, and
3educators. Illinois is a cultural crown jewel of the United
4States. Illinois and Chicago boast a robust history and
5community of creative artists, writers, musicians, architects,
6orchestras, live music and entertainment venues, civic operas,
7recording studios, and universities. The COVID-19 pandemic and
8the economic fallout that ensued brought on especially
9difficult circumstances for the live entertainment industry at
10large. Throughout the State, this has meant the closure of and
11overall decrease in culturally engaging aspects of Illinois
12cities from Cairo to Chicago.
13    According to the Americans for the Arts Action Fund, arts
14and culture represent 3.1% of the State's gross domestic
15product and 190,078 jobs. In fact, in 2020, Illinois arts and
16culture was larger than the State's agriculture industry. In
172015, nonprofit arts organizations in the State generated
18$4,000,000,000 in economic activity that supported 111,068
19jobs and generated $478,500,000 in State and local government
20revenue. In Chicago specifically, nonprofit arts groups
21generated $3,200,000,000 in total economic activity and
22$336,500,000 in State and local government revenue. Audiences
23exceeded 36,000,000 people.
24    Yet, during the COVID-19 pandemic, the arts suffered. As a
25result, Illinois arts and culture value added decreased by 9%
26between 2019 and 2020 and employment decreased by 12%.

 

 

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1Ultimately, $3,200,000,000 and 26,644 jobs were lost. Even as
2live performances have resumed, audience sizes remain below
3pre-pandemic levels. Regional theaters, local orchestras,
4opera houses, and performing arts organizations are reporting
5persistent drops in attendance.
6    It is the policy of this State to promote and encourage the
7training and hiring of Illinois residents who represent the
8diversity of the Illinois population through the creation and
9implementation of training, education, and recruitment
10programs organized in cooperation with Illinois colleges and
11universities, labor organizations, and the commercial
12for-profit music industry.
 
13    Section 50-10. Definitions.
14    "Department" means the Department of Commerce and Economic
15Opportunity.
16    "Expenditure in the State" means (i) an expenditure to
17acquire, from a source within the State, property that is
18subject to tax under the Use Tax Act, the Service Use Tax Act,
19the Service Occupation Tax Act, or the Retailers' Occupation
20Tax Act or (ii) an expenditure for compensation for services
21performed within the State that is subject to State income tax
22under the Illinois Income Tax Act.
23    "Illinois labor expenditure" means gross salary or wages,
24including, but not limited to, taxes, benefits, and any other
25consideration incurred or paid to artist employees of the

 

 

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1applicant for services rendered to and on behalf of the
2qualified music company, provided that the expenditure is:
3        (1) incurred or paid by the applicant on or after the
4    effective date of this Act for services related to any
5    portion of a qualified music company from rehearsals,
6    performances, and any other qualified music company
7    related activities;
8        (2) limited to the first $100,000 of wages incurred or
9    paid to each employee of a qualified music production in
10    each tax year;
11        (3) paid in the tax year for which the applicant is
12    claiming the tax credit award;
13        (4) paid to persons residing in Illinois at the time
14    payments were made; and
15        (5) reasonable under the circumstances.
16    "Qualified music company" means an entity that (i) is
17authorized to do business in Illinois, (ii) is engaged
18directly or indirectly in the production, distribution, or
19promotion of music, (iii) is certified by the Department as
20meeting the eligibility requirements of this Act, and (iv) has
21executed a contract with the Department providing the terms
22and conditions for its participation.
23    "Qualified music company payroll" or "QMC payroll" means
24wages reported by the qualified music company in box 1 of each
25W-2 form prepared for an employee of the qualified music
26company who is an Illinois resident.

 

 

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1    "Resident copyright" means the copyright of a musical
2composition written by an Illinois resident or owned by an
3Illinois-domiciled music company, as evidenced by documents of
4ownership, including, but not limited to, registration with
5the United States Copyright Office.
6    "Sound recording" means a recording of music, poetry, or a
7spoken-word performance made, in whole or in part, in
8Illinois. "Sound recording" does not include the audio
9portions of dialogue or words spoken and recorded as part of
10television news coverage or athletic events.
11    "Sound recording production company" means a company
12engaged in the business of producing sound recordings. "Sound
13recording production company" does not include any person or
14company, or any company owned, affiliated, or controlled, in
15whole or in part, by any company or person, that is in default
16on a loan made by the State or a loan guaranteed by the State,
17nor which has ever declared bankruptcy under which an
18obligation of the company or person to pay or repay public
19funds or moneys was discharged as a part of the bankruptcy.
20    "State-certified production" means a sound recording
21production, or a series of productions, including but not
22limited to master and demonstration recordings, occurring over
23the course of a 12-month period, and the base
24production-related investment that is approved by the
25Department within 180 days after receipt by the Department of
26a complete application for initial certification of a

 

 

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1production. If the production is not approved within 180 days,
2the Department shall provide a written report to the Senate
3Executive Committee and the House Executive Committee that
4states the reason why the production has not been approved.
5    "Tax credit award" means the issuance to a taxpayer by the
6Department of a tax credit award against the taxes imposed by
7subsections (a) and (b) of Section 201 of the Illinois Income
8Tax Act as provided in this Act.
 
9    Section 50-15. Powers of the Department. The Department,
10in addition to those powers granted under the Civil
11Administrative Code of Illinois, is granted and has all the
12powers necessary or convenient to carry out and effectuate the
13purposes and provisions of this Act, including, but not
14limited to, the power and authority to:
15        (1) adopt rules that are necessary and appropriate for
16    the administration of this Act;
17        (2) establish forms for applications, notifications,
18    contracts, or any other agreements with respect to tax
19    credits under this Act and to accept applications for tax
20    credits under this Act at any time during the year;
21        (3) assist applicants for tax credits under this Act
22    to promote, foster, and support sound recording and live
23    theater development and production and its related job
24    creation or retention within the State;
25        (4) gather information and conduct inquiries, as

 

 

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1    provided in this Act, required for the Department to
2    comply with the provisions of this Act and, without
3    limitation, to obtain information with respect to
4    applicants for the purpose of making any designations or
5    certifications necessary or desirable to assist the
6    Department with any recommendation or guidance in the
7    furtherance of the purposes of this Act and relating to
8    applicants' participation in training, education, and
9    recruitment programs that are organized in cooperation
10    with Illinois colleges and universities or labor
11    organizations designed to promote and encourage the
12    training and hiring of Illinois residents who represent
13    the diversity of the Illinois population;
14        (5) provide for sufficient personnel to permit
15    administrative, staffing, operating, and related support
16    required to adequately discharge the Department's duties
17    and responsibilities under this Act from funds as may be
18    appropriated by the General Assembly for the
19    administration of this Act; and
20        (6) require that the applicant at all times keep
21    proper books and records of accounts relating to the tax
22    credit award, in accordance with generally accepted
23    accounting principles consistently applied, and make those
24    books and records available for reasonable Department
25    inspection and audit, upon reasonable written request by
26    the Department, during the applicant's normal business

 

 

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1    hours. Any documents or data made available to the
2    Department or received by the Department from the
3    applicant by any agent, employee, officer, or service
4    provider shall be deemed confidential and shall not
5    constitute public records to the extent that the documents
6    or data consist of commercial or financial information
7    regarding the operation by the applicant of any theater or
8    any accredited theater production or any recipient of any
9    tax credit award under this Act.
 
10    Section 50-20. Application for certification of qualified
11music company. Any applicant that operates a qualified music
12company located in the State or is proposing to operate a
13qualified music company in the State may apply to the
14Department to have the qualified music company certified by
15the Department as a qualified music company.
 
16    Section 50-25. Review of applications for qualified music
17company certificates.
18     (a) The Department shall issue a qualified music company
19certificate to an applicant if it finds that a preponderance
20of the following conditions exists:
21        (1) the applicant is engaged directly or indirectly in
22    the production, distribution, and promotion of music;
23        (2) the applicant intends to make the expenditure in
24    the State required for certification of the qualified

 

 

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1    music company;
2        (3) the applicant's qualified music company is
3    economically sound and will benefit the people of the
4    State of Illinois by increasing opportunities for