103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB2316

 

Introduced 2/10/2023, by Sen. Donald P. DeWitte

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/234 new
35 ILCS 5/704A

    Amends the Illinois Income Tax Act. Creates an income tax credit for any taxpayers that hire a new employee for a position as a driver for which a commercial driver's license is required and any individual taxpayers who are employed as a driver in a position in which a commercial driver's license is required. Effective immediately.


LRB103 25038 HLH 51372 b

 

 

A BILL FOR

 

SB2316LRB103 25038 HLH 51372 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5adding Section 234 and by changing Section 704A as follows:
 
6    (35 ILCS 5/234 new)
7    Sec. 234. Commercial driver's license employment tax
8credit.
9    (a) For tax years beginning on or after January 1, 2024 and
10ending on or before December 31, 2026, any taxpayers that hire
11a new employee for a position as a driver for which a
12commercial driver's license is required under Article V of the
13Illinois Vehicle Code and any individual taxpayers who are
14employed as a driver in a position in which a commercial
15driver's license is required are entitled to a credit against
16the taxes imposed under subsections (a) and (b) of Section 201
17of this Section. The amount of the credit for the employer and
18employee shall each be equal to 2.475% of the wages paid during
19the taxable year to the full-time or part-time employee. In
20lieu of the credit allowed under this Section against the
21taxes imposed pursuant to subsections (a) and (b) of Section
22201 of the Illinois Income Tax Act reported on the taxpayer's
23annual return or the returns of partners or Subchapter S

 

 

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1corporation shareholders of the taxpayer, the employing
2taxpayer may elect to claim the credit against its obligation
3to pay over withholding under Section 704A of the Illinois
4Income Tax Act. If requested by the employee taxpayer, the
5employing taxpayer shall reduce the amount of withholding
6required on wages under Section 704A of the Illinois Income
7Tax Act on each paycheck by taking into account the employee
8tax credit.
9    (b) To qualify for the credit, more than 50% of the
10employee's duties must involve driving a vehicle for which a
11commercial driver's license is required.
12    (c) If the taxpayer is a partnership, a Subchapter S
13corporation, or a limited liability company that has elected
14partnership tax treatment, the employing taxpayer's credit
15shall be allowed to the partners, shareholders, or members in
16accordance with the determination of income and distributive
17share of income under Sections 702 and 704 and subchapter S of
18the Internal Revenue Code, as applicable. The Department, in
19cooperation with the Department of Commerce and Economic
20Opportunity, shall adopt rules to implement and administer
21this Section.
22    (d) As used in this Section, "new employee" means an
23employee who is hired on or after the effective date of this
24amendatory Act of the 103rd General Assembly for a new or
25vacant position with the employer.
26    (e) This Section is exempt from the provisions of Section

 

 

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1250 of this Act.
 
2    (35 ILCS 5/704A)
3    Sec. 704A. Employer's return and payment of tax withheld.
4    (a) In general, every employer who deducts and withholds
5or is required to deduct and withhold tax under this Act on or
6after January 1, 2008 shall make those payments and returns as
7provided in this Section.
8    (b) Returns. Every employer shall, in the form and manner
9required by the Department, make returns with respect to taxes
10withheld or required to be withheld under this Article 7 for
11each quarter beginning on or after January 1, 2008, on or
12before the last day of the first month following the close of
13that quarter.
14    (c) Payments. With respect to amounts withheld or required
15to be withheld on or after January 1, 2008:
16        (1) Semi-weekly payments. For each calendar year, each
17    employer who withheld or was required to withhold more
18    than $12,000 during the one-year period ending on June 30
19    of the immediately preceding calendar year, payment must
20    be made:
21            (A) on or before each Friday of the calendar year,
22        for taxes withheld or required to be withheld on the
23        immediately preceding Saturday, Sunday, Monday, or
24        Tuesday;
25            (B) on or before each Wednesday of the calendar

 

 

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1        year, for taxes withheld or required to be withheld on
2        the immediately preceding Wednesday, Thursday, or
3        Friday.
4        Beginning with calendar year 2011, payments made under
5    this paragraph (1) of subsection (c) must be made by
6    electronic funds transfer.
7        (2) Semi-weekly payments. Any employer who withholds
8    or is required to withhold more than $12,000 in any
9    quarter of a calendar year is required to make payments on
10    the dates set forth under item (1) of this subsection (c)
11    for each remaining quarter of that calendar year and for
12    the subsequent calendar year.
13        (3) Monthly payments. Each employer, other than an
14    employer described in items (1) or (2) of this subsection,
15    shall pay to the Department, on or before the 15th day of
16    each month the taxes withheld or required to be withheld
17    during the immediately preceding month.
18        (4) Payments with returns. Each employer shall pay to
19    the Department, on or before the due date for each return
20    required to be filed under this Section, any tax withheld
21    or required to be withheld during the period for which the
22    return is due and not previously paid to the Department.
23    (d) Regulatory authority. The Department may, by rule:
24        (1) Permit employers, in lieu of the requirements of
25    subsections (b) and (c), to file annual returns due on or
26    before January 31 of the year for taxes withheld or

 

 

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1    required to be withheld during the previous calendar year
2    and, if the aggregate amounts required to be withheld by
3    the employer under this Article 7 (other than amounts
4    required to be withheld under Section 709.5) do not exceed
5    $1,000 for the previous calendar year, to pay the taxes
6    required to be shown on each such return no later than the
7    due date for such return.
8        (2) Provide that any payment required to be made under
9    subsection (c)(1) or (c)(2) is deemed to be timely to the
10    extent paid by electronic funds transfer on or before the
11    due date for deposit of federal income taxes withheld
12    from, or federal employment taxes due with respect to, the
13    wages from which the Illinois taxes were withheld.
14        (3) Designate one or more depositories to which
15    payment of taxes required to be withheld under this
16    Article 7 must be paid by some or all employers.
17        (4) Increase the threshold dollar amounts at which
18    employers are required to make semi-weekly payments under
19    subsection (c)(1) or (c)(2).
20    (e) Annual return and payment. Every employer who deducts
21and withholds or is required to deduct and withhold tax from a
22person engaged in domestic service employment, as that term is
23defined in Section 3510 of the Internal Revenue Code, may
24comply with the requirements of this Section with respect to
25such employees by filing an annual return and paying the taxes
26required to be deducted and withheld on or before the 15th day

 

 

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1of the fourth month following the close of the employer's
2taxable year. The Department may allow the employer's return
3to be submitted with the employer's individual income tax
4return or to be submitted with a return due from the employer
5under Section 1400.2 of the Unemployment Insurance Act.
6    (f) Magnetic media and electronic filing. With respect to
7taxes withheld in calendar years prior to 2017, any W-2 Form
8that, under the Internal Revenue Code and regulations
9promulgated thereunder, is required to be submitted to the
10Internal Revenue Service on magnetic media or electronically
11must also be submitted to the Department on magnetic media or
12electronically for Illinois purposes, if required by the
13Department.
14    With respect to taxes withheld in 2017 and subsequent
15calendar years, the Department may, by rule, require that any
16return (including any amended return) under this Section and
17any W-2 Form that is required to be submitted to the Department
18must be submitted on magnetic media or electronically.
19    The due date for submitting W-2 Forms shall be as
20prescribed by the Department by rule.
21    (g) For amounts deducted or withheld after December 31,
222009, a taxpayer who makes an election under subsection (f) of
23Section 5-15 of the Economic Development for a Growing Economy
24Tax Credit Act for a taxable year shall be allowed a credit
25against payments due under this Section for amounts withheld
26during the first calendar year beginning after the end of that

 

 

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

 

 

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1form and manner that the Department, by rule, requires and pay
2to the Department or to a depositary designated by the
3Department those withheld taxes not retained by the taxpayer.
4For purposes of this subsection (g), the term taxpayer shall
5include taxpayer and members of the taxpayer's unitary
6business group as defined under paragraph (27) of subsection
7(a) of Section 1501 of this Act. This Section is exempt from
8the provisions of Section 250 of this Act. No credit awarded
9under the Economic Development for a Growing Economy Tax
10Credit Act for agreements entered into on or after January 1,
112015 may be credited against payments due under this Section.
12    (g-1) For amounts deducted or withheld after December 31,
132024, a taxpayer who makes an election under the Reimagining
14Electric Vehicles in Illinois Act shall be allowed a credit
15against payments due under this Section for amounts withheld
16during the first quarterly reporting period beginning after
17the certificate is issued equal to the portion of the REV
18Illinois Credit attributable to the incremental income tax
19attributable to new employees and retained employees as
20certified by the Department of Commerce and Economic
21Opportunity pursuant to an agreement with the taxpayer under
22the Reimagining Electric Vehicles in Illinois Act for the
23taxable year. The credit or credits may not reduce the
24taxpayer's obligation for any payment due under this Section
25to less than zero. If the amount of the credit or credits
26exceeds the total payments due under this Section with respect

 

 

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1to amounts withheld during the quarterly reporting period, the
2excess may be carried forward and applied against the
3taxpayer's liability under this Section in the succeeding
4quarterly reporting period as allowed to be carried forward
5under paragraph (4) of Section 211 of this Act. The credit or
6credits shall be applied to the earliest quarterly reporting
7period for which there is a tax liability. If there are credits
8from more than one quarterly reporting period that are
9available to offset a liability, the earlier credit shall be
10applied first. Each employer who deducts and withholds or is
11required to deduct and withhold tax under this Act and who
12retains income tax withholdings this subsection must make a
13return with respect to such taxes and retained amounts in the
14form and manner that the Department, by rule, requires and pay
15to the Department or to a depositary designated by the
16Department those withheld taxes not retained by the taxpayer.
17For purposes of this subsection (g-1), the term taxpayer shall
18include taxpayer and members of the taxpayer's unitary
19business group as defined under paragraph (27) of subsection
20(a) of Section 1501 of this Act. This Section is exempt from
21the provisions of Section 250 of this Act.
22    (g-2) For amounts deducted or withheld after December 31,
232024, a taxpayer who makes an election under the Manufacturing
24Illinois Chips for Real Opportunity (MICRO) Act shall be
25allowed a credit against payments due under this Section for
26amounts withheld during the first quarterly reporting period

 

 

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1beginning after the certificate is issued equal to the portion
2of the MICRO Illinois Credit attributable to the incremental
3income tax attributable to new employees and retained
4employees as certified by the Department of Commerce and
5Economic Opportunity pursuant to an agreement with the
6taxpayer under the Manufacturing Illinois Chips for Real
7Opportunity (MICRO) Act for the taxable year. The credit or
8credits may not reduce the taxpayer's obligation for any
9payment due under this Section to less than zero. If the amount
10of the credit or credits exceeds the total payments due under
11this Section with respect to amounts withheld during the
12quarterly reporting period, the excess may be carried forward
13and applied against the taxpayer's liability under this
14Section in the succeeding quarterly reporting period as
15allowed to be carried forward under paragraph (4) of Section
16211 of this Act. The credit or credits shall be applied to the
17earliest quarterly reporting period for which there is a tax
18liability. If there are credits from more than one quarterly
19reporting period that are available to offset a liability, the
20earlier credit shall be applied first. Each employer who
21deducts and withholds or is required to deduct and withhold
22tax under this Act and who retains income tax withholdings
23this subsection must make a return with respect to such taxes
24and retained amounts in the form and manner that the
25Department, by rule, requires and pay to the Department or to a
26depositary designated by the Department those withheld taxes

 

 

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1not retained by the taxpayer. For purposes of this subsection,
2the term taxpayer shall include taxpayer and members of the
3taxpayer's unitary business group as defined under paragraph
4(27) of subsection (a) of Section 1501 of this Act. This
5Section is exempt from the provisions of Section 250 of this
6Act.
7    (h) An employer may claim a credit against payments due
8under this Section for amounts withheld during the first
9calendar year ending after the date on which a tax credit
10certificate was issued under Section 35 of the Small Business
11Job Creation Tax Credit Act. The credit shall be equal to the
12amount shown on the certificate, but may not reduce the
13taxpayer's obligation for any payment due under this Section
14to less than zero. If the amount of the credit exceeds the
15total payments due under this Section with respect to amounts
16withheld during the calendar year, the excess may be carried
17forward and applied against the taxpayer's liability under
18this Section in the 5 succeeding calendar years. The credit
19shall be applied to the earliest year for which there is a tax
20liability. If there are credits from more than one calendar
21year that are available to offset a liability, the earlier
22credit shall be applied first. This Section is exempt from the
23provisions of Section 250 of this Act.
24    (i) Each employer with 50 or fewer full-time equivalent
25employees during the reporting period may claim a credit
26against the payments due under this Section for each qualified

 

 

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1employee in an amount equal to the maximum credit allowable.
2The credit may be taken against payments due for reporting
3periods that begin on or after January 1, 2020, and end on or
4before December 31, 2027. An employer may not claim a credit
5for an employee who has worked fewer than 90 consecutive days
6immediately preceding the reporting period; however, such
7credits may accrue during that 90-day period and be claimed
8against payments under this Section for future reporting
9periods after the employee has worked for the employer at
10least 90 consecutive days. In no event may the credit exceed
11the employer's liability for the reporting period. Each
12employer who deducts and withholds or is required to deduct
13and withhold tax under this Act and who retains income tax
14withholdings under this subsection must make a return with
15respect to such taxes and retained amounts in the form and
16manner that the Department, by rule, requires and pay to the
17Department or to a depositary designated by the Department
18those withheld taxes not retained by the employer.
19    For each reporting period, the employer may not claim a
20credit or credits for more employees than the number of
21employees making less than the minimum or reduced wage for the
22current calendar year during the last reporting period of the
23preceding calendar year. Notwithstanding any other provision
24of this subsection, an employer shall not be eligible for
25credits for a reporting period unless the average wage paid by
26the employer per employee for all employees making less than

 

 

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1$55,000 during the reporting period is greater than the
2average wage paid by the employer per employee for all
3employees making less than $55,000 during the same reporting
4period of the prior calendar year.
5    For purposes of this subsection (i):
6    "Compensation paid in Illinois" has the meaning ascribed
7to that term under Section 304(a)(2)(B) of this Act.
8    "Employer" and "employee" have the meaning ascribed to
9those terms in the Minimum Wage Law, except that "employee"
10also includes employees who work for an employer with fewer
11than 4 employees. Employers that operate more than one
12establishment pursuant to a franchise agreement or that
13constitute members of a unitary business group shall aggregate
14their employees for purposes of determining eligibility for
15the credit.
16    "Full-time equivalent employees" means the ratio of the
17number of paid hours during the reporting period and the
18number of working hours in that period.
19    "Maximum credit" means the percentage listed below of the
20difference between the amount of compensation paid in Illinois
21to employees who are paid not more than the required minimum
22wage reduced by the amount of compensation paid in Illinois to
23employees who were paid less than the current required minimum
24wage during the reporting period prior to each increase in the
25required minimum wage on January 1. If an employer pays an
26employee more than the required minimum wage and that employee

 

 

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1previously earned less than the required minimum wage, the
2employer may include the portion that does not exceed the
3required minimum wage as compensation paid in Illinois to
4employees who are paid not more than the required minimum
5wage.
6        (1) 25% for reporting periods beginning on or after
7    January 1, 2020 and ending on or before December 31, 2020;
8        (2) 21% for reporting periods beginning on or after
9    January 1, 2021 and ending on or before December 31, 2021;
10        (3) 17% for reporting periods beginning on or after
11    January 1, 2022 and ending on or before December 31, 2022;
12        (4) 13% for reporting periods beginning on or after
13    January 1, 2023 and ending on or before December 31, 2023;
14        (5) 9% for reporting periods beginning on or after
15    January 1, 2024 and ending on or before December 31, 2024;
16        (6) 5% for reporting periods beginning on or after
17    January 1, 2025 and ending on or before December 31, 2025.
18    The amount computed under this subsection may continue to
19be claimed for reporting periods beginning on or after January
201, 2026 and:
21        (A) ending on or before December 31, 2026 for
22    employers with more than 5 employees; or
23        (B) ending on or before December 31, 2027 for
24    employers with no more than 5 employees.
25    "Qualified employee" means an employee who is paid not
26more than the required minimum wage and has an average wage

 

 

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1paid per hour by the employer during the reporting period
2equal to or greater than his or her average wage paid per hour
3by the employer during each reporting period for the
4immediately preceding 12 months. A new qualified employee is
5deemed to have earned the required minimum wage in the
6preceding reporting period.
7    "Reporting period" means the quarter for which a return is
8required to be filed under subsection (b) of this Section.
9    (j) For reporting periods beginning on or after January 1,
102023, if a private employer grants all of its employees the
11option of taking a paid leave of absence of at least 30 days
12for the purpose of serving as an organ donor or bone marrow
13donor, then the private employer may take a credit against the
14payments due under this Section in an amount equal to the
15amount withheld under this Section with respect to wages paid
16while the employee is on organ donation leave, not to exceed
17$1,000 in withholdings for each employee who takes organ
18donation leave. To be eligible for the credit, such a leave of
19absence must be taken without loss of pay, vacation time,
20compensatory time, personal days, or sick time for at least
21the first 30 days of the leave of absence. The private employer
22shall adopt rules governing organ donation leave, including
23rules that (i) establish conditions and procedures for
24requesting and approving leave and (ii) require medical
25documentation of the proposed organ or bone marrow donation
26before leave is approved by the private employer. A private

 

 

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1employer must provide, in the manner required by the
2Department, documentation from the employee's medical
3provider, which the private employer receives from the
4employee, that verifies the employee's organ donation. The
5private employer must also provide, in the manner required by
6the Department, documentation that shows that a qualifying
7organ donor leave policy was in place and offered to all
8qualifying employees at the time the leave was taken. For the
9private employer to receive the tax credit, the employee
10taking organ donor leave must allow for the applicable medical
11records to be disclosed to the Department. If the private
12employer cannot provide the required documentation to the
13Department, then the private employer is ineligible for the
14credit under this Section. A private employer must also
15provide, in the form required by the Department, any
16additional documentation or information required by the
17Department to administer the credit under this Section. The
18credit under this subsection (j) shall be taken within one
19year after the date upon which the organ donation leave
20begins. If the leave taken spans into a second tax year, the
21employer qualifies for the allowable credit in the later of
22the 2 years. If the amount of credit exceeds the tax liability
23for the year, the excess may be carried and applied to the tax
24liability for the 3 taxable years following the excess credit
25year. The tax credit shall be applied to the earliest year for
26which there is a tax liability. If there are credits for more

 

 

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1than one year that are available to offset liability, the
2earlier credit shall be applied first.
3    Nothing in this subsection (j) prohibits a private
4employer from providing an unpaid leave of absence to its
5employees for the purpose of serving as an organ donor or bone
6marrow donor; however, if the employer's policy provides for
7fewer than 30 days of paid leave for organ or bone marrow
8donation, then the employer shall not be eligible for the
9credit under this Section.
10    As used in this subsection (j):
11    "Organ" means any biological tissue of the human body that
12may be donated by a living donor, including, but not limited
13to, the kidney, liver, lung, pancreas, intestine, bone, skin,
14or any subpart of those organs.
15    "Organ donor" means a person from whose body an organ is
16taken to be transferred to the body of another person.
17    "Private employer" means a sole proprietorship,
18corporation, partnership, limited liability company, or other
19entity with one or more employees. "Private employer" does not
20include a municipality, county, State agency, or other public
21employer.
22    This subsection (j) is exempt from the provisions of
23Section 250 of this Act.
24    (k) An employer may claim a credit against payments due
25under this Section as provided in Section 234.
26(Source: P.A. 101-1, eff. 2-19-19; 102-669, eff. 11-16-21;

 

 

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1102-700, Article 30, Section 30-5, eff. 4-19-22; 102-700,
2Article 110, Section 110-905, eff. 4-19-22; revised 6-1-22.)
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.