97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB1359

 

Introduced 2/8/2011, by Sen. Carole Pankau

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 10/5-15

    Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that, on and after the effective date of the amendatory Act, any Taxpayer that is awarded a credit under the Act may elect to claim the Credit against its withholding tax obligations (now, only certain taxpayers that are engaged in motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing may claim the credit against withholdings). Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Economic Development for a Growing Economy
5Tax Credit Act is amended by changing Section 5-15 as follows:
 
6    (35 ILCS 10/5-15)
7    Sec. 5-15. Tax Credit Awards. Subject to the conditions set
8forth in this Act, a Taxpayer is entitled to a Credit against
9or, as described in subsection (g) of this Section, a payment
10towards taxes imposed pursuant to subsections (a) and (b) of
11Section 201 of the Illinois Income Tax Act that may be imposed
12on the Taxpayer for a taxable year beginning on or after
13January 1, 1999, if the Taxpayer is awarded a Credit by the
14Department under this Act for that taxable year.
15    (a) The Department shall make Credit awards under this Act
16to foster job creation and retention in Illinois.
17    (b) A person that proposes a project to create new jobs in
18Illinois must enter into an Agreement with the Department for
19the Credit under this Act.
20    (c) The Credit shall be claimed for the taxable years
21specified in the Agreement.
22    (d) The Credit shall not exceed the Incremental Income Tax
23attributable to the project that is the subject of the

 

 

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1Agreement.
2    (e) Nothing herein shall prohibit a Tax Credit Award to an
3Applicant that uses a PEO if all other award criteria are
4satisfied.
5    (f) In lieu of the Credit allowed under this Act against
6the taxes imposed pursuant to subsections (a) and (b) of
7Section 201 of the Illinois Income Tax Act for any taxable year
8ending on or after December 31, 2009, the Taxpayer may elect to
9claim the Credit against its obligation to pay over withholding
10under Section 704A of the Illinois Income Tax Act.
11        (1) Prior to the effective date of this amendatory Act
12    of the 97th General Assembly, the The election under this
13    subsection (f) may be made only by a Taxpayer that (i) is
14    primarily engaged in one of the following business
15    activities: motor vehicle metal stamping, automobile
16    manufacturing, automobile and light duty motor vehicle
17    manufacturing, motor vehicle manufacturing, light truck
18    and utility vehicle manufacturing, heavy duty truck
19    manufacturing, or motor vehicle body manufacturing and
20    (ii) meets the following criteria:
21            (A) the Taxpayer (i) had an Illinois net loss or an
22        Illinois net loss deduction under Section 207 of the
23        Illinois Income Tax Act for the taxable year in which
24        the Credit is awarded, (ii) employed a minimum of 1,000
25        full-time employees in this State during the taxable
26        year in which the Credit is awarded, (iii) has an

 

 

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1        Agreement under this Act on December 14, 2009 (the
2        effective date of Public Act 96-834), and (iv) is in
3        compliance with all provisions of that Agreement;
4            (B) the Taxpayer (i) had an Illinois net loss or an
5        Illinois net loss deduction under Section 207 of the
6        Illinois Income Tax Act for the taxable year in which
7        the Credit is awarded, (ii) employed a minimum of 1,000
8        full-time employees in this State during the taxable
9        year in which the Credit is awarded, and (iii) has
10        applied for an Agreement within 365 days after December
11        14, 2009 (the effective date of Public Act 96-834); or
12            (C) the Taxpayer (i) had an Illinois net operating
13        loss carryforward under Section 207 of the Illinois
14        Income Tax Act in a taxable year ending during calendar
15        year 2008, (ii) has applied for an Agreement within 150
16        days after the effective date of this amendatory Act of
17        the 96th General Assembly, (iii) creates at least 400
18        new jobs in Illinois, (iv) retains at least 2,000 jobs
19        in Illinois that would have been at risk of relocation
20        out of Illinois over a 10-year period, and (v) makes a
21        capital investment of at least $75,000,000.
22        (1.5) On and after the effective date of this
23    amendatory Act of the 97th General Assembly, any Taxpayer
24    that is awarded a Credit under this Act may elect to claim
25    the Credit against its obligation to pay over withholding
26    under Section 704A of the Illinois Income Tax Act.

 

 

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1        (2) An election under this subsection shall allow the
2    credit to be taken against payments otherwise due under
3    Section 704A of the Illinois Income Tax Act during the
4    first calendar year beginning after the end of the taxable
5    year in which the credit is awarded under this Act.
6        (3) The election shall be made in the form and manner
7    required by the Illinois Department of Revenue and, once
8    made, shall be irrevocable.
9        (4) If a Taxpayer who meets the requirements of
10    subparagraph (A) of paragraph (1) of this subsection (f)
11    elects to claim the Credit against its withholdings as
12    provided in this subsection (f), then, on and after the
13    date of the election, the terms of the Agreement between
14    the Taxpayer and the Department may not be further amended
15    during the term of the Agreement.
16    (g) A pass-through entity that has been awarded a credit
17under this Act, its shareholders, or its partners may treat
18some or all of the credit awarded pursuant to this Act as a tax
19payment for purposes of the Illinois Income Tax Act. The term
20"tax payment" means a payment as described in Article 6 or
21Article 8 of the Illinois Income Tax Act or a composite payment
22made by a pass-through entity on behalf of any of its
23shareholders or partners to satisfy such shareholders' or
24partners' taxes imposed pursuant to subsections (a) and (b) of
25Section 201 of the Illinois Income Tax Act. In no event shall
26the amount of the award credited pursuant to this Act exceed

 

 

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1the Illinois income tax liability of the pass-through entity or
2its shareholders or partners for the taxable year.
3(Source: P.A. 95-375, eff. 8-23-07; 96-834, eff. 12-14-09;
496-836, eff. 12-16-09; 96-905, eff. 6-4-10; 96-1000, eff.
57-2-10.)
 
6    Section 99. Effective date. This Act takes effect upon
7becoming law.