Full Text of SB3215 97th General Assembly
SB3215 97TH GENERAL ASSEMBLY |
| | 97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012 SB3215 Introduced 2/1/2012, by Sen. Susan Garrett SYNOPSIS AS INTRODUCED: |
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35 ILCS 5/207 | from Ch. 120, par. 2-207 |
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Amends the Illinois Income Tax Act. Removes a provision limiting the net loss carryover deduction to $100,000 for any taxable year ending on or after December 31, 2012 and prior to December 31, 2014. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
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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 Illinois Income Tax Act is amended by | 5 | | changing Section 207 as follows:
| 6 | | (35 ILCS 5/207) (from Ch. 120, par. 2-207)
| 7 | | (Text of Section before amendment by P.A. 97-636 ) | 8 | | Sec. 207. Net Losses.
| 9 | | (a) If after applying all of the (i) modifications
provided | 10 | | for in paragraph (2) of Section 203(b), paragraph (2) of | 11 | | Section
203(c) and paragraph (2) of Section 203(d) and (ii) the | 12 | | allocation and
apportionment provisions of Article 3 of this
| 13 | | Act and subsection (c) of this Section, the taxpayer's net | 14 | | income results in a loss;
| 15 | | (1) for any taxable year ending prior to December 31, | 16 | | 1999, such loss
shall be allowed
as a carryover or | 17 | | carryback deduction in the manner allowed under Section
172 | 18 | | of the Internal Revenue Code;
| 19 | | (2) for any taxable year ending on or after December | 20 | | 31, 1999 and prior
to December 31, 2003, such loss
shall be | 21 | | allowed as a carryback to each of the 2 taxable years | 22 | | preceding the
taxable year of such loss and shall be a net | 23 | | operating loss carryover to each of the
20 taxable years |
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| 1 | | following the taxable year of such loss; and
| 2 | | (3) for any taxable year ending on or after December | 3 | | 31, 2003, such loss
shall be allowed as a net operating | 4 | | loss carryover to each of the 12 taxable years
following | 5 | | the taxable year of such loss, except as provided in | 6 | | subsection (d).
| 7 | | (a-5) Election to relinquish carryback and order of | 8 | | application of
losses.
| 9 | | (A) For losses incurred in tax years ending prior | 10 | | to December 31,
2003, the taxpayer may elect to | 11 | | relinquish the entire carryback period
with respect to | 12 | | such loss. Such election shall be made in the form and | 13 | | manner
prescribed by the Department and shall be made | 14 | | by the due date (including
extensions of time) for | 15 | | filing the taxpayer's return for the taxable year in
| 16 | | which such loss is incurred, and such election, once | 17 | | made, shall be
irrevocable.
| 18 | | (B) The entire amount of such loss shall be carried | 19 | | to the earliest
taxable year to which such loss may be | 20 | | carried. The amount of such loss which
shall be carried | 21 | | to each of the other taxable years shall be the excess, | 22 | | if
any, of the amount of such loss over the sum of the | 23 | | deductions for carryback or
carryover of such loss | 24 | | allowable for each of the prior taxable years to which
| 25 | | such loss may be carried.
| 26 | | (b) Any loss determined under subsection (a) of this |
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| 1 | | Section must be carried
back or carried forward in the same | 2 | | manner for purposes of subsections (a)
and (b) of Section 201 | 3 | | of this Act as for purposes of subsections (c) and
(d) of | 4 | | Section 201 of this Act.
| 5 | | (c) Notwithstanding any other provision of this Act, for | 6 | | each taxable year ending on or after December 31, 2008, for | 7 | | purposes of computing the loss for the taxable year under | 8 | | subsection (a) of this Section and the deduction taken into | 9 | | account for the taxable year for a net operating loss carryover | 10 | | under paragraphs (1), (2), and (3) of subsection (a) of this | 11 | | Section, the loss and net operating loss carryover shall be | 12 | | reduced in an amount equal to the reduction to the net | 13 | | operating loss and net operating loss carryover to the taxable | 14 | | year, respectively, required under Section 108(b)(2)(A) of the | 15 | | Internal Revenue Code, multiplied by a fraction, the numerator | 16 | | of which is the amount of discharge of indebtedness income that | 17 | | is excluded from gross income for the taxable year (but only if | 18 | | the taxable year ends on or after December 31, 2008) under | 19 | | Section 108(a) of the Internal Revenue Code and that would have | 20 | | been allocated and apportioned to this State under Article 3 of | 21 | | this Act but for that exclusion, and the denominator of which | 22 | | is the total amount of discharge of indebtedness income | 23 | | excluded from gross income under Section 108(a) of the Internal | 24 | | Revenue Code for the taxable year. The reduction required under | 25 | | this subsection (c) shall be made after the determination of | 26 | | Illinois net income for the taxable year in which the |
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| 1 | | indebtedness is discharged.
| 2 | | (d) In the case of a corporation (other than a Subchapter S | 3 | | corporation), no carryover deduction shall be allowed under | 4 | | this Section for any taxable year ending after December 31, | 5 | | 2010 and prior to December 31, 2014; provided that, for | 6 | | purposes of determining the taxable years to which a net loss | 7 | | may be carried under subsection (a) of this Section, no taxable | 8 | | year for which a deduction is disallowed under this subsection | 9 | | shall be counted. | 10 | | (e) In the case of a residual interest holder in a real | 11 | | estate mortgage investment conduit subject to Section 860E of | 12 | | the Internal Revenue Code, the net loss in subsection (a) shall | 13 | | be equal to: | 14 | | (1) the amount computed under subsection (a), without | 15 | | regard to this subsection (e), or if that amount is | 16 | | positive, zero; | 17 | | (2) minus an amount equal to the amount computed under | 18 | | subsection (a), without regard to this subsection (e), | 19 | | minus the amount that would be computed under subsection | 20 | | (a) if the taxpayer's federal taxable income were computed | 21 | | without regard to Section 860E of the Internal Revenue Code | 22 | | and without regard to this subsection (e). | 23 | | The modification in this subsection (e) is exempt from the | 24 | | provisions of Section 250. | 25 | | (Source: P.A. 96-1496, eff. 1-13-11; 97-507, eff. 8-23-11.) |
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| 1 | | (Text of Section after amendment by P.A. 97-636 ) | 2 | | Sec. 207. Net Losses.
| 3 | | (a) If after applying all of the (i) modifications
provided | 4 | | for in paragraph (2) of Section 203(b), paragraph (2) of | 5 | | Section
203(c) and paragraph (2) of Section 203(d) and (ii) the | 6 | | allocation and
apportionment provisions of Article 3 of this
| 7 | | Act and subsection (c) of this Section, the taxpayer's net | 8 | | income results in a loss;
| 9 | | (1) for any taxable year ending prior to December 31, | 10 | | 1999, such loss
shall be allowed
as a carryover or | 11 | | carryback deduction in the manner allowed under Section
172 | 12 | | of the Internal Revenue Code;
| 13 | | (2) for any taxable year ending on or after December | 14 | | 31, 1999 and prior
to December 31, 2003, such loss
shall be | 15 | | allowed as a carryback to each of the 2 taxable years | 16 | | preceding the
taxable year of such loss and shall be a net | 17 | | operating loss carryover to each of the
20 taxable years | 18 | | following the taxable year of such loss; and
| 19 | | (3) for any taxable year ending on or after December | 20 | | 31, 2003, such loss
shall be allowed as a net operating | 21 | | loss carryover to each of the 12 taxable years
following | 22 | | the taxable year of such loss, except as provided in | 23 | | subsection (d).
| 24 | | (a-5) Election to relinquish carryback and order of | 25 | | application of
losses.
| 26 | | (A) For losses incurred in tax years ending prior |
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| 1 | | to December 31,
2003, the taxpayer may elect to | 2 | | relinquish the entire carryback period
with respect to | 3 | | such loss. Such election shall be made in the form and | 4 | | manner
prescribed by the Department and shall be made | 5 | | by the due date (including
extensions of time) for | 6 | | filing the taxpayer's return for the taxable year in
| 7 | | which such loss is incurred, and such election, once | 8 | | made, shall be
irrevocable.
| 9 | | (B) The entire amount of such loss shall be carried | 10 | | to the earliest
taxable year to which such loss may be | 11 | | carried. The amount of such loss which
shall be carried | 12 | | to each of the other taxable years shall be the excess, | 13 | | if
any, of the amount of such loss over the sum of the | 14 | | deductions for carryback or
carryover of such loss | 15 | | allowable for each of the prior taxable years to which
| 16 | | such loss may be carried.
| 17 | | (b) Any loss determined under subsection (a) of this | 18 | | Section must be carried
back or carried forward in the same | 19 | | manner for purposes of subsections (a)
and (b) of Section 201 | 20 | | of this Act as for purposes of subsections (c) and
(d) of | 21 | | Section 201 of this Act.
| 22 | | (c) Notwithstanding any other provision of this Act, for | 23 | | each taxable year ending on or after December 31, 2008, for | 24 | | purposes of computing the loss for the taxable year under | 25 | | subsection (a) of this Section and the deduction taken into | 26 | | account for the taxable year for a net operating loss carryover |
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| 1 | | under paragraphs (1), (2), and (3) of subsection (a) of this | 2 | | Section, the loss and net operating loss carryover shall be | 3 | | reduced in an amount equal to the reduction to the net | 4 | | operating loss and net operating loss carryover to the taxable | 5 | | year, respectively, required under Section 108(b)(2)(A) of the | 6 | | Internal Revenue Code, multiplied by a fraction, the numerator | 7 | | of which is the amount of discharge of indebtedness income that | 8 | | is excluded from gross income for the taxable year (but only if | 9 | | the taxable year ends on or after December 31, 2008) under | 10 | | Section 108(a) of the Internal Revenue Code and that would have | 11 | | been allocated and apportioned to this State under Article 3 of | 12 | | this Act but for that exclusion, and the denominator of which | 13 | | is the total amount of discharge of indebtedness income | 14 | | excluded from gross income under Section 108(a) of the Internal | 15 | | Revenue Code for the taxable year. The reduction required under | 16 | | this subsection (c) shall be made after the determination of | 17 | | Illinois net income for the taxable year in which the | 18 | | indebtedness is discharged.
| 19 | | (d) In the case of a corporation (other than a Subchapter S | 20 | | corporation), no carryover deduction shall be allowed under | 21 | | this Section for any taxable year ending after December 31, | 22 | | 2010 and prior to December 31, 2012 , and no carryover deduction | 23 | | shall exceed $100,000 for any taxable year ending on or after | 24 | | December 31, 2012 and prior to December 31, 2014 ; provided | 25 | | that, for purposes of determining the taxable years to which a | 26 | | net loss may be carried under subsection (a) of this Section, |
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| 1 | | no taxable year for which a deduction is disallowed under this | 2 | | subsection , or for which the deduction would exceed $100,000 if | 3 | | not for this subsection, shall be counted. | 4 | | (e) In the case of a residual interest holder in a real | 5 | | estate mortgage investment conduit subject to Section 860E of | 6 | | the Internal Revenue Code, the net loss in subsection (a) shall | 7 | | be equal to: | 8 | | (1) the amount computed under subsection (a), without | 9 | | regard to this subsection (e), or if that amount is | 10 | | positive, zero; | 11 | | (2) minus an amount equal to the amount computed under | 12 | | subsection (a), without regard to this subsection (e), | 13 | | minus the amount that would be computed under subsection | 14 | | (a) if the taxpayer's federal taxable income were computed | 15 | | without regard to Section 860E of the Internal Revenue Code | 16 | | and without regard to this subsection (e). | 17 | | The modification in this subsection (e) is exempt from the | 18 | | provisions of Section 250. | 19 | | (Source: P.A. 96-1496, eff. 1-13-11; 97-507, eff. 8-23-11; | 20 | | 97-636, eff. 6-1-12.)
| 21 | | Section 95. No acceleration or delay. Where this Act makes | 22 | | changes in a statute that is represented in this Act by text | 23 | | that is not yet or no longer in effect (for example, a Section | 24 | | represented by multiple versions), the use of that text does | 25 | | not accelerate or delay the taking effect of (i) the changes |
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| 1 | | made by this Act or (ii) provisions derived from any other | 2 | | Public Act.
| 3 | | Section 99. Effective date. This Act takes effect upon | 4 | | becoming law.
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