Full Text of HB5461 102nd General Assembly
HB5461 102ND GENERAL ASSEMBLY |
| | 102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022 HB5461 Introduced 1/31/2022, by Rep. Angelica Guerrero-Cuellar SYNOPSIS AS INTRODUCED: |
| 35 ILCS 40/5 | | 35 ILCS 40/10 | | 35 ILCS 40/40 | | 35 ILCS 40/65 | |
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Amends the Invest in Kids Act. Provides that non-public pre-kindergarten schools are considered qualified schools. Provides that the credit shall be in the amount of 100% (currently, 75%) of the contribution. Provides that the credit may not exceed $1,333,333 per taxpayer (currently, $1,000,000). Establishes priority groups for the awarding of scholarships. Makes other changes. Effective immediately.
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| | A BILL FOR |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Invest in Kids Act is amended by changing | 5 | | Sections 5, 10, 40, and 65 as follows: | 6 | | (35 ILCS 40/5) | 7 | | (Section scheduled to be repealed on January 1, 2025)
| 8 | | Sec. 5. Definitions. As used in this Act: | 9 | | "Authorized contribution" means the contribution amount | 10 | | that is listed on the contribution authorization certificate | 11 | | issued to the taxpayer.
| 12 | | "Board" means the State Board of Education.
| 13 | | "Contribution" means a donation made by the taxpayer | 14 | | during the taxable year for providing scholarships as provided | 15 | | in this Act. | 16 | | "Custodian" means, with respect to eligible students, an | 17 | | Illinois resident who is a parent or legal guardian of the | 18 | | eligible student or students.
| 19 | | "Department" means the Department of Revenue. | 20 | | "Eligible student" means a child who:
| 21 | | (1) is a member of a household whose federal adjusted | 22 | | gross income the year before he or she
initially receives | 23 | | a scholarship under this program, as determined by the |
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| 1 | | Department, does not exceed 300% of the federal poverty
| 2 | | level and, once the child receives a scholarship, does not | 3 | | exceed 400% of the federal poverty
level;
| 4 | | (2) is eligible to attend a pre-kindergarten school, | 5 | | public elementary school , or high school in Illinois in | 6 | | the semester immediately preceding the semester for which | 7 | | he or she first receives a scholarship or is
starting | 8 | | school in Illinois for the first time when he or she first | 9 | | receives a scholarship; and
| 10 | | (3) resides in Illinois while receiving a scholarship. | 11 | | "Family member" means a parent, child, or sibling, whether | 12 | | by whole blood, half blood, or adoption; spouse; or stepchild. | 13 | | "Focus district" means a school district which has a | 14 | | school that is either (i) a school that has one or more | 15 | | subgroups in which the average student performance is at or | 16 | | below the State average for the lowest 10% of student | 17 | | performance in that subgroup or (ii) a school with an average | 18 | | graduation rate of less than 60% and not identified for | 19 | | priority.
| 20 | | "Jointly administered CTE program" means a program or set | 21 | | of programs within a non-public school located in Illinois, as | 22 | | determined by the State Board of Education pursuant to Section | 23 | | 7.5 of this Act. | 24 | | "Necessary costs and fees" includes the customary charge | 25 | | for instruction and use of facilities in general
and the | 26 | | additional fixed fees charged for specified purposes that are |
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| 1 | | required generally of non-scholarship recipients for each | 2 | | academic period for which the scholarship applicant actually | 3 | | enrolls, including costs associated with student assessments, | 4 | | but does not
include fees payable only once and other | 5 | | contingent deposits that are refundable in whole or in part. | 6 | | The Board may prescribe, by rules consistent with this Act, | 7 | | detailed provisions concerning the computation of necessary | 8 | | costs and fees.
| 9 | | "Scholarship granting organization" means an entity that:
| 10 | | (1) is exempt from taxation under Section 501(c)(3) of | 11 | | the Internal Revenue Code;
| 12 | | (2) uses at least 95% of the qualified contributions | 13 | | received during a taxable year for scholarships;
| 14 | | (3) provides scholarships to students according to the | 15 | | guidelines of this Act;
| 16 | | (4) deposits and holds qualified contributions and any | 17 | | income derived from qualified contributions
in an account | 18 | | that is separate from the organization's operating fund or | 19 | | other funds until such qualified contributions or income | 20 | | are withdrawn for use; and
| 21 | | (5) is approved to issue certificates of receipt.
| 22 | | "Technical academy" means a non-public school located in | 23 | | Illinois that: (1) registers with the Board pursuant to | 24 | | Section 2-3.25 of the School Code; and (2) operates or will | 25 | | operate a jointly administered CTE program as the primary | 26 | | focus of the school. To maintain its status as a technical |
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| 1 | | academy, the non-public school must obtain recognition from | 2 | | the Board pursuant to Section 2-3.25o of the School Code | 3 | | within 2 calendar years of its registration with the Board. | 4 | | "Qualified contribution" means the authorized contribution | 5 | | made by a taxpayer to a scholarship granting organization for | 6 | | which the taxpayer has received a certificate of receipt from | 7 | | such organization.
| 8 | | "Qualified school" means a non-public school , including a | 9 | | non-public pre-kindergarten school, located in Illinois and | 10 | | recognized by the Board pursuant to Section 2-3.25o of the | 11 | | School Code.
| 12 | | "Scholarship" means an educational scholarship awarded to | 13 | | an eligible student to attend a qualified school
of their | 14 | | custodians' choice in an amount not exceeding the necessary | 15 | | costs and fees to attend that school.
| 16 | | "Taxpayer" means any individual, corporation, partnership, | 17 | | trust, or other entity subject to the Illinois income tax. For | 18 | | the purposes of this Act, 2 individuals filing a joint return | 19 | | shall be considered one taxpayer.
| 20 | | (Source: P.A. 102-16, eff. 6-17-21.) | 21 | | (35 ILCS 40/10) | 22 | | (Section scheduled to be repealed on January 1, 2025)
| 23 | | Sec. 10. Credit awards. | 24 | | (a) The Department shall award credits against the tax | 25 | | imposed under subsections (a) and (b) of Section 201 of the |
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| 1 | | Illinois Income Tax Act to taxpayers who make qualified | 2 | | contributions. For contributions made under this Act, the | 3 | | credit shall be equal to 100% 75% of the total amount of
| 4 | | qualified contributions made by the taxpayer during a taxable | 5 | | year, not to exceed a credit of $1,333,333 $1,000,000 per | 6 | | taxpayer.
| 7 | | (b) The aggregate amount of all credits the Department may | 8 | | award under this Act in any calendar year may not exceed | 9 | | $75,000,000. | 10 | | (c) Contributions made by individuals, corporations | 11 | | (including Subchapter S corporations), partnerships, and | 12 | | trusts under this Act may not be directed to a particular | 13 | | subset of schools, a particular school, a particular group of | 14 | | students, or a particular student.
Contributions made by | 15 | | individuals under this Act may be directed to a particular | 16 | | subset of schools or a particular school but may not be | 17 | | directed to a particular group of students or a particular | 18 | | student. | 19 | | (d) (Blank). No credit shall be taken under this Act for | 20 | | any qualified contribution for which the taxpayer claims a | 21 | | federal income tax deduction. | 22 | | (e) Credits shall be awarded in a manner, as determined by | 23 | | the Department, that is geographically proportionate to | 24 | | enrollment in recognized non-public schools in Illinois. If | 25 | | the cap on the aggregate credits that may be awarded by the | 26 | | Department is not reached by June 1 of a given year, the |
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| 1 | | Department shall award remaining credits on a first-come, | 2 | | first-served basis, without regard to the limitation of this | 3 | | subsection.
| 4 | | (f) Credits awarded for donations made to a technical | 5 | | academy shall be awarded without regard to subsection (e), but | 6 | | shall not exceed 15% of the annual statewide program cap. For | 7 | | the purposes of this subsection, "technical academy" means a | 8 | | technical academy that is registered with the Board within 30 | 9 | | days after the effective date of this amendatory Act of the | 10 | | 102nd General Assembly. | 11 | | (Source: P.A. 102-16, eff. 6-17-21.) | 12 | | (35 ILCS 40/40) | 13 | | (Section scheduled to be repealed on January 1, 2025)
| 14 | | Sec. 40. Scholarship granting organization | 15 | | responsibilities. | 16 | | (a) Before granting a scholarship for an academic year, | 17 | | all scholarship granting organizations shall assess and | 18 | | document each student's eligibility for the academic year.
| 19 | | (b) A scholarship granting organization shall grant | 20 | | scholarships only to eligible students.
| 21 | | (c) A scholarship granting organization shall allow an | 22 | | eligible student to attend any qualified school of the | 23 | | student's choosing, subject to the availability of funds.
| 24 | | (d) In granting scholarships, beginning in the 2022-2023 | 25 | | school year and for each school year thereafter, a scholarship |
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| 1 | | granting organization shall give priority to eligible students | 2 | | who received a scholarship from a scholarship granting | 3 | | organization during the previous school year. Second priority | 4 | | shall be given to the following priority groups: | 5 | | (1) (blank); eligible students who received a | 6 | | scholarship from a scholarship granting organization | 7 | | during the previous school year;
| 8 | | (2) eligible students who are members of a household | 9 | | whose previous year's total annual income does not exceed | 10 | | 185% of the federal poverty level;
| 11 | | (3) eligible students who reside within a focus | 12 | | district; and
| 13 | | (4) eligible students who are siblings of students | 14 | | currently receiving a scholarship.
| 15 | | (d-5) A scholarship granting organization shall begin | 16 | | granting scholarships no later than February 1 preceding the | 17 | | school year for which the scholarship is sought. Each The | 18 | | priority group groups identified in subsection (d) of this | 19 | | Section shall be eligible to receive scholarships on a | 20 | | first-come, first-served basis until the April 1 immediately | 21 | | preceding the school year for which the scholarship is sought | 22 | | starting with the first priority group identified in | 23 | | subsection (d) of this Section. . Applications for scholarships | 24 | | for eligible students meeting the qualifications of one or | 25 | | more priority groups that are received before April 1 must be | 26 | | either approved or denied within 10 business days after |
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| 1 | | receipt. Beginning April 1, all eligible students shall be | 2 | | eligible to receive scholarships without regard to the | 3 | | priority groups identified in subsection (d) of this Section. | 4 | | (e) Except as provided in subsection (e-5) of this | 5 | | Section, scholarships shall not exceed the lesser of (i) the | 6 | | statewide average operational expense per
student among public | 7 | | schools ; or (ii) the necessary costs and fees for attendance | 8 | | at the qualified school ; or (iii) the maximum scholarship | 9 | | amount set by the qualified school, if the qualified school | 10 | | chooses to set such an amount, which may not exceed the | 11 | | necessary costs and fees for attendance at the qualified | 12 | | school. The qualified school shall notify the scholarship | 13 | | granting organization of its necessary costs and fees as well | 14 | | as any maximum scholarship amount set by the school .
| 15 | | Scholarships shall be prorated as follows: | 16 | | (1) for eligible students whose household income is | 17 | | less than 185% of the federal poverty level, the | 18 | | scholarship shall be 100% of the amount determined | 19 | | pursuant to this subsection (e) and subsection (e-5) of | 20 | | this Section; | 21 | | (2) for eligible students whose household income is | 22 | | 185% or more of the federal poverty level but less than | 23 | | 250% of the federal poverty level, the average of | 24 | | scholarships shall be 75% of the amount determined | 25 | | pursuant to this subsection (e) and subsection (e-5) of | 26 | | this Section or in an amount set by the qualified school |
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| 1 | | pursuant to subsection (e)(iii) of this Section ; and | 2 | | (3) for eligible students whose household income is | 3 | | 250% or more of the federal poverty level, the average of | 4 | | scholarships shall be 50% of the amount determined | 5 | | pursuant to this subsection (e) and subsection (e-5) of | 6 | | this Section. | 7 | | (e-5) The statewide average operational expense per | 8 | | student among public schools shall be multiplied by the | 9 | | following factors: | 10 | | (1) for students determined eligible to receive | 11 | | services under the federal Individuals with Disabilities | 12 | | Education Act, 2; | 13 | | (2) for students who are English learners, as defined | 14 | | in subsection (d) of Section 14C-2 of the School Code, | 15 | | 1.2; and | 16 | | (3) for students who are gifted and talented children, | 17 | | as defined in Section 14A-20 of the School Code, 1.1. | 18 | | (f) A scholarship granting organization shall distribute | 19 | | scholarship payments to the participating school where the | 20 | | student is enrolled.
| 21 | | (g) Each For the 2018-2019 school year through the | 22 | | 2021-2022 school year, each scholarship granting organization | 23 | | shall expend no less than 75% of the qualified contributions | 24 | | received during the calendar year in which the qualified | 25 | | contributions were received. No more than 25% of the
qualified | 26 | | contributions may be carried forward to the following calendar |
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| 1 | | year.
| 2 | | (h) (Blank). For the 2022-2023 school year, each | 3 | | scholarship granting organization shall expend all qualified | 4 | | contributions received during the calendar year in which the | 5 | | qualified contributions were
received. No qualified | 6 | | contributions may be carried forward to the following calendar | 7 | | year.
| 8 | | (i) A scholarship granting organization shall allow an | 9 | | eligible student to transfer a scholarship during a school | 10 | | year to any other participating school of the custodian's | 11 | | choice. Such scholarships shall be prorated.
| 12 | | (j) With the prior approval of the Department, a | 13 | | scholarship granting organization may transfer funds to | 14 | | another scholarship granting organization if additional funds | 15 | | are required to meet scholarship demands at the receiving | 16 | | scholarship granting organization. All transferred funds must | 17 | | be
deposited by the receiving scholarship granting | 18 | | organization into its scholarship accounts. All transferred | 19 | | amounts received by any scholarship granting organization must | 20 | | be separately
disclosed to the Department.
| 21 | | (k) If the approval of a scholarship granting organization | 22 | | is revoked as provided in Section 20 of this Act or the | 23 | | scholarship granting organization is dissolved, all remaining | 24 | | qualified contributions of the scholarship granting | 25 | | organization shall be transferred to another scholarship | 26 | | granting organization. All transferred funds must be deposited |
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| 1 | | by the receiving scholarship granting organization into its | 2 | | scholarship accounts. | 3 | | (l) Scholarship granting organizations shall make | 4 | | reasonable efforts to advertise the availability of | 5 | | scholarships to eligible students.
| 6 | | (Source: P.A. 100-465, eff. 8-31-17 .) | 7 | | (35 ILCS 40/65) | 8 | | (Section scheduled to be repealed on January 1, 2025)
| 9 | | Sec. 65. Credit period; repeal. | 10 | | (a) A taxpayer may take a credit under this Act for tax | 11 | | years beginning on or after January 1, 2018 and ending before | 12 | | January 1, 2024. A taxpayer may not take a credit pursuant to | 13 | | this Act for tax years beginning on or after January 1, 2024 .
| 14 | | (b) This Act is exempt from the provisions of Section 250 | 15 | | of the Illinois Income Tax Act repealed on January 1, 2025 .
| 16 | | (Source: P.A. 102-16, eff. 6-17-21.)
| 17 | | Section 99. Effective date. This Act takes effect upon | 18 | | becoming law.
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