HB5424 103RD GENERAL ASSEMBLY

LRB103 37922 HLH 68054 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB5424

Introduced 2/9/2024, by Rep. Michael J. Coffey, Jr.

SYNOPSIS AS INTRODUCED:

35 ILCS 5/241 new

Amends the Illinois Income Tax Act. Creates an income tax credit for fire equipment distributors that are actively researching and developing alternative fire prevention equipment that contains no perfluoroalkyl or polyfluoroalkyl substances. Provides that the credit is in an amount equal to 75% of the amount expended during the taxable year to actively develop that equipment. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Income Tax Act is amended by adding Section 241 as follows:

(35 ILCS 5/241 new)

Sec. 241. Fire prevention equipment credit.

(a) For taxable years beginning on or after January 1, 2025 and beginning before January 1, 2035, each taxpayer that is engaged in business as a fire equipment distributor and that is actively researching and developing alternative fire prevention equipment that contains no perfluoroalkyl or polyfluoroalkyl substances, or PFAS, may apply to the Office for a credit against the taxes imposed by subsections (a) and (b) of Section 201 in an amount equal to 75% of the amount expended by the taxpayer during the taxable year to actively develop that equipment.

(b) In no event may the Office award more than $5,000,000 in credits under this Section in any taxable year.

(c) In no event shall a credit under this Section reduce a taxpayer's liability to less than zero. If the amount of credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability for the 5 taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset liability, the earlier credit shall be applied first.

(d) As used in this Section:

"Fire equipment distributor" means any person, company, or corporation that services, recharges, hydro-tests, inspects, installs, maintains, alters, repairs, or replaces fire extinguishers, fire suppression devices, or fire suppression systems. "Fire equipment distributor" does not include a person, company, or corporation that works exclusively on water sprinklers or a person, company, or corporation that only hydro-tests cylinders that store extinguishment materials.

"Fire prevention equipment" means equipment that is used by a fire department to actively prevent or extinguish fire hazards and that is known to contain PFAS, including, but not limited to, foam products or gear used by firefighters.

"Office" means the Office of the State Fire Marshal.

Section 99. Effective date. This Act takes effect upon becoming law.