Illinois General Assembly - Full Text of SB1823
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Full Text of SB1823  102nd General Assembly

SB1823eng 102ND GENERAL ASSEMBLY

  
  
  

 


 
SB1823 EngrossedLRB102 15347 HLH 20707 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
5changing Section 221 as follows:
 
6    (35 ILCS 5/221)
7    Sec. 221. Rehabilitation costs; qualified historic
8properties; River Edge Redevelopment Zone.
9    (a) For taxable years that begin on or after January 1,
102012 and begin prior to January 1, 2018, there shall be allowed
11a tax credit against the tax imposed by subsections (a) and (b)
12of Section 201 of this Act in an amount equal to 25% of
13qualified expenditures incurred by a qualified taxpayer during
14the taxable year in the restoration and preservation of a
15qualified historic structure located in a River Edge
16Redevelopment Zone pursuant to a qualified rehabilitation
17plan, provided that the total amount of such expenditures (i)
18must equal $5,000 or more and (ii) must exceed 50% of the
19purchase price of the property.
20    (a-1) For taxable years that begin on or after January 1,
212018 and end prior to January 1, 2027 January 1, 2022, there
22shall be allowed a tax credit against the tax imposed by
23subsections (a) and (b) of Section 201 of this Act in an

 

 

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1aggregate amount equal to 25% of qualified expenditures
2incurred by a qualified taxpayer in the restoration and
3preservation of a qualified historic structure located in a
4River Edge Redevelopment Zone pursuant to a qualified
5rehabilitation plan, provided that the total amount of such
6expenditures must: (i) equal $5,000 or more; and (ii) exceed
7the adjusted basis of the qualified historic structure on the
8first day the qualified rehabilitation plan begins; and (iii)
9be a part of a qualified rehabilitation plan or phase of a
10qualified rehabilitation plan that received final approval to
11begin the expenditures no later than December 31, 2026. For
12any rehabilitation project, regardless of duration or number
13of phases, the project's compliance with the foregoing
14provisions (i) and (ii) shall be determined based on the
15aggregate amount of qualified expenditures for the entire
16project and may include expenditures incurred under subsection
17(a), this subsection, or both subsection (a) and this
18subsection. If the qualified rehabilitation plan spans
19multiple years, the aggregate credit for the entire project
20shall be allowed in the last taxable year, except for phased
21rehabilitation projects, which may receive credits upon
22completion of each phase. Before obtaining the first phased
23credit: (A) the total amount of such expenditures must meet
24the requirements of provisions (i) and (ii) of this
25subsection; (B) the rehabilitated portion of the qualified
26historic structure must be placed in service; and (C) the

 

 

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1requirements of subsection (b) must be met.
2    (a-2) For taxable years beginning on or after January 1,
32021 and ending prior to January 1, 2022, there shall be
4allowed a tax credit against the tax imposed by subsections
5(a) and (b) of Section 201 as provided in Section 10-10.3 of
6the River Edge Redevelopment Zone Act. The credit allowed
7under this subsection (a-2) shall apply only to taxpayers that
8make a capital investment of at least $1,000,000 in a
9qualified rehabilitation plan.
10    The credit or credits may not reduce the taxpayer's
11liability to less than zero. If the amount of the credit or
12credits exceeds the taxpayer's liability, the excess may be
13carried forward and applied against the taxpayer's liability
14in succeeding calendar years in the manner provided under
15paragraph (4) of Section 211 of this Act. The credit or credits
16shall be applied to the earliest year for which there is a tax
17liability. If there are credits from more than one taxable
18year that are available to offset a liability, the earlier
19credit shall be applied first.
20    For partners, shareholders of Subchapter S corporations,
21and owners of limited liability companies, if the liability
22company is treated as a partnership for the purposes of
23federal and State income taxation, there shall be allowed a
24credit under this Section to be determined in accordance with
25the determination of income and distributive share of income
26under Sections 702 and 704 and Subchapter S of the Internal

 

 

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1Revenue Code.
2    The total aggregate amount of credits awarded under the
3Blue Collar Jobs Act (Article 20 of this amendatory Act of the
4101st General Assembly) shall not exceed $20,000,000 in any
5State fiscal year.
6    (b) To obtain a tax credit pursuant to this Section, the
7taxpayer must apply with the Department of Natural Resources.
8The Department of Natural Resources shall determine the amount
9of eligible rehabilitation costs and expenses in addition to
10the amount of the River Edge construction jobs credit within
1145 days of receipt of a complete application. The taxpayer
12must submit a certification of costs prepared by an
13independent certified public accountant that certifies (i) the
14project expenses, (ii) whether those expenses are qualified
15expenditures, and (iii) that the qualified expenditures exceed
16the adjusted basis of the qualified historic structure on the
17first day the qualified rehabilitation plan commenced. The
18Department of Natural Resources is authorized, but not
19required, to accept this certification of costs to determine
20the amount of qualified expenditures and the amount of the
21credit. The Department of Natural Resources shall provide
22guidance as to the minimum standards to be followed in the
23preparation of such certification. The Department of Natural
24Resources and the National Park Service shall determine
25whether the rehabilitation is consistent with the United
26States Secretary of the Interior's Standards for

 

 

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1Rehabilitation.
2    (b-1) Upon completion of the project and approval of the
3complete application, the Department of Natural Resources
4shall issue a single certificate in the amount of the eligible
5credits equal to 25% of qualified expenditures incurred during
6the eligible taxable years, as defined in subsections (a) and
7(a-1), excepting any credits awarded under subsection (a)
8prior to January 1, 2019 (the effective date of Public Act
9100-629) and any phased credits issued prior to the eligible
10taxable year under subsection (a-1). At the time the
11certificate is issued, an issuance fee up to the maximum
12amount of 2% of the amount of the credits issued by the
13certificate may be collected from the applicant to administer
14the provisions of this Section. If collected, this issuance
15fee shall be deposited into the Historic Property
16Administrative Fund, a special fund created in the State
17treasury. Subject to appropriation, moneys in the Historic
18Property Administrative Fund shall be provided to the
19Department of Natural Resources as reimbursement for the costs
20associated with administering this Section.
21    (c) The taxpayer must attach the certificate to the tax
22return on which the credits are to be claimed. The tax credit
23under this Section may not reduce the taxpayer's liability to
24less than zero. If the amount of the credit exceeds the tax
25liability for the year, the excess credit may be carried
26forward and applied to the tax liability of the 5 taxable years

 

 

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1following the excess credit year.
2    (c-1) Subject to appropriation, moneys in the Historic
3Property Administrative Fund shall be used, on a biennial
4basis beginning at the end of the second fiscal year after
5January 1, 2019 (the effective date of Public Act 100-629), to
6hire a qualified third party to prepare a biennial report to
7assess the overall economic impact to the State from the
8qualified rehabilitation projects under this Section completed
9in that year and in previous years. The overall economic
10impact shall include at least: (1) the direct and indirect or
11induced economic impacts of completed projects; (2) temporary,
12permanent, and construction jobs created; (3) sales, income,
13and property tax generation before, during construction, and
14after completion; and (4) indirect neighborhood impact after
15completion. The report shall be submitted to the Governor and
16the General Assembly. The report to the General Assembly shall
17be filed with the Clerk of the House of Representatives and the
18Secretary of the Senate in electronic form only, in the manner
19that the Clerk and the Secretary shall direct.
20    (c-2) The Department of Natural Resources may adopt rules
21to implement this Section in addition to the rules expressly
22authorized in this Section.
23    (d) As used in this Section, the following terms have the
24following meanings.
25    "Phased rehabilitation" means a project that is completed
26in phases, as defined under Section 47 of the federal Internal

 

 

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1Revenue Code and pursuant to National Park Service regulations
2at 36 C.F.R. 67.
3    "Placed in service" means the date when the property is
4placed in a condition or state of readiness and availability
5for a specifically assigned function as defined under Section
647 of the federal Internal Revenue Code and federal Treasury
7Regulation Sections 1.46 and 1.48.
8    "Qualified expenditure" means all the costs and expenses
9defined as qualified rehabilitation expenditures under Section
1047 of the federal Internal Revenue Code that were incurred in
11connection with a qualified historic structure.
12    "Qualified historic structure" means a certified historic
13structure as defined under Section 47(c)(3) of the federal
14Internal Revenue Code.
15    "Qualified rehabilitation plan" means a project that is
16approved by the Department of Natural Resources and the
17National Park Service as being consistent with the United
18States Secretary of the Interior's Standards for
19Rehabilitation.
20    "Qualified taxpayer" means the owner of the qualified
21historic structure or any other person who qualifies for the
22federal rehabilitation credit allowed by Section 47 of the
23federal Internal Revenue Code with respect to that qualified
24historic structure. Partners, shareholders of subchapter S
25corporations, and owners of limited liability companies (if
26the limited liability company is treated as a partnership for

 

 

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1purposes of federal and State income taxation) are entitled to
2a credit under this Section to be determined in accordance
3with the determination of income and distributive share of
4income under Sections 702 and 703 and subchapter S of the
5Internal Revenue Code, provided that credits granted to a
6partnership, a limited liability company taxed as a
7partnership, or other multiple owners of property shall be
8passed through to the partners, members, or owners
9respectively on a pro rata basis or pursuant to an executed
10agreement among the partners, members, or owners documenting
11any alternate distribution method.
12(Source: P.A. 100-236, eff. 8-18-17; 100-629, eff. 1-1-19;
13100-695, eff. 8-3-18; 101-9, eff. 6-5-19; 101-81, eff.
147-12-19.)
 
15    Section 99. Effective date. This Act takes effect upon
16becoming law.