Illinois General Assembly - Full Text of HB4599
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Full Text of HB4599  96th General Assembly

HB4599sam003 96TH GENERAL ASSEMBLY

Sen. Jeffrey M. Schoenberg

Filed: 1/6/2011

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 4599

2    AMENDMENT NO. ______. Amend House Bill 4599, AS AMENDED, by
3replacing everything after the enacting clause with the
4following:
 
5    "Section 5. The Small Business Job Creation Tax Credit Act
6is amended by changing Sections 10, 25, and 35 as follows:
 
7    (35 ILCS 25/10)
8    Sec. 10. Definitions. In this Act:
9    "Applicant" means a person that is operating a business
10located within the State of Illinois that is engaged in
11interstate or intrastate commerce and either:
12         (1) has no more than 50 full-time employees, without
13    regard to the location of employment of such employees at
14    the beginning of the incentive period; or .
15        (2) hired within the incentive period an employee who
16    had participated as worker-trainee in the Put Illinois to

 

 

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1    Work Program during 2010.
2    In the case of any person that is a member of a unitary
3business group within the meaning of subdivision (a)(27) of
4Section 1501 of the Illinois Income Tax Act, "applicant" refers
5to the unitary business group.
6    "Certificate" means the tax credit certificate issued by
7the Department under Section 35 of this Act.
8    "Certificate of eligibility" means the certificate issued
9by the Department under Section 20 of this Act.
10    "Credit" means the amount awarded by the Department to an
11applicant by issuance of a certificate under Section 35 of this
12Act for each new full-time equivalent employee hired or job
13created.
14    "Department" means the Department of Commerce and Economic
15Opportunity.
16    "Director" means the Director of the Department.
17    "Full-time employee" means an individual who is employed
18for a basic wage for at least 35 hours each week or who renders
19any other standard of service generally accepted by industry
20custom or practice as full-time employment.
21    "Incentive period" means the period beginning July 1, 2010
22and ending on June 30, 2011.
23    "Basic wage" means compensation for employment that is no
24less than $10 $13.75 per hour or the equivalent salary for a
25new employee.
26    "New employee" means a full-time employee:

 

 

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1        (1) who first became employed by an applicant with less
2    than 50 full-time employees within the incentive period
3    whose hire results in a net increase in the applicant's
4    full-time Illinois employees and who is receiving a basic
5    wage as compensation; or .
6        (2) who participated as a worker-trainee in the Put
7    Illinois to Work Program during 2010 and who is
8    subsequently hired during the incentive period by an
9    applicant and who is receiving a basic wage as
10    compensation.
11    The term "new employee" does not include:
12        (1) a person who was previously employed in Illinois by
13    the applicant or a related member prior to the onset of the
14    incentive period; or
15        (2) any individual who has a direct or indirect
16    ownership interest of at least 5% in the profits, capital,
17    or value of the applicant or a related member.
18    "Noncompliance date" means, in the case of an applicant
19that is not complying with the requirements of the provisions
20of this Act, the day following the last date upon which the
21taxpayer was in compliance with the requirements of the
22provisions of this Act, as determined by the Director, pursuant
23to Section 45 of this Act.
24    "Put Illinois to Work Program" means a worker training and
25employment program that was established by the State of
26Illinois with funding from the United States Department of

 

 

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1Health and Human Services of Emergency Temporary Assistance to
2Needy Families funds authorized by the American Recovery and
3Reinvestment Act of 2009 (ARRA TANF Funds). These ARRA TANF
4funds were in turn used by the State of Illinois to fund the
5Put Illinois to Work Program.
6    "Related member" means a person that, with respect to the
7applicant during any portion of the incentive period, is any
8one of the following,
9        (1) An individual, if the individual and the members of
10    the individual's family (as defined in Section 318 of the
11    Internal Revenue Code) own directly, indirectly,
12    beneficially, or constructively, in the aggregate, at
13    least 50% of the value of the outstanding profits, capital,
14    stock, or other ownership interest in the applicant.
15        (2) A partnership, estate, or trust and any partner or
16    beneficiary, if the partnership, estate, or trust and its
17    partners or beneficiaries own directly, indirectly,
18    beneficially, or constructively, in the aggregate, at
19    least 50% of the profits, capital, stock, or other
20    ownership interest in the applicant.
21        (3) A corporation, and any party related to the
22    corporation in a manner that would require an attribution
23    of stock from the corporation under the attribution rules
24    of Section 318 of the Internal Revenue Code, if the
25    applicant and any other related member own, in the
26    aggregate, directly, indirectly, beneficially, or

 

 

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1    constructively, at least 50% of the value of the
2    corporation's outstanding stock.
3        (4) A corporation and any party related to that
4    corporation in a manner that would require an attribution
5    of stock from the corporation to the party or from the
6    party to the corporation under the attribution rules of
7    Section 318 of the Internal Revenue Code, if the
8    corporation and all such related parties own, in the
9    aggregate, at least 50% of the profits, capital, stock, or
10    other ownership interest in the applicant.
11        (5) A person to or from whom there is attribution of
12    stock ownership in accordance with Section 1563(e) of the
13    Internal Revenue Code, except that for purposes of
14    determining whether a person is a related member under this
15    paragraph, "20%" shall be substituted for "5%" whenever
16    "5%" appears in Section 1563(e) of the Internal Revenue
17    Code.
18(Source: P.A. 96-888, eff. 4-13-10.)
 
19    (35 ILCS 25/25)
20    Sec. 25. Tax credit.
21    (a) Subject to the conditions set forth in this Act, an
22applicant is entitled to a credit against payment of taxes
23withheld under Section 704A of the Illinois Income Tax Act:
24        (1) for new employees who participated as
25    worker-trainees in the Put Illinois to Work Program during

 

 

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1    2010:
2            (A) in the first calendar year ending on or after
3        the date that is 6 months after December 31, 2010, or
4        the date of hire, whichever is later. Under this
5        subparagraph, the applicant is entitled to one-half of
6        the credit allowable for each new employee who is
7        employed for at least 6 months after the date of hire;
8        and
9            (B) in the first calendar year ending on or after
10        the date that is 12 months after December 31, 2010, or
11        the date of hire, whichever is later. Under this
12        subparagraph, the applicant is entitled to one-half of
13        the credit allowable for each new employee who is
14        employed for at least 12 months after the date of hire;
15         (2) for all other new employees, in the first calendar
16    year years ending on or after the date that is 12 months
17    after the date of hire of a new employee. The credit shall
18    be allowed as a credit to an applicant for each full-time
19    employee hired during the incentive period that results in
20    a net increase in full-time Illinois employees, where the
21    net increase in the employer's full-time Illinois
22    employees is maintained for at least 12 months.
23    (b) The Department shall make credit awards under this Act
24to further job creation.
25    (c) The credit shall be claimed for the first calendar year
26ending on or after the date on which the certificate is issued

 

 

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1by the Department.
2    (d) The credit shall not exceed $2,500 per new employee
3hired.
4    (e) The net increase in full-time Illinois employees,
5measured on an annual full-time equivalent basis, shall be the
6total number of full-time Illinois employees of the applicant
7on June 30, 2011, minus the number of full-time Illinois
8employees employed by the employer on July 1, 2010. For
9purposes of the calculation, an employer that begins doing
10business in this State during the incentive period, as
11determined by the Director, shall be treated as having zero
12Illinois employees on July 1, 2010.
13    (f) The net increase in the number of full-time Illinois
14employees of the applicant under subsection (e) must be
15sustained continuously for at least 12 months, starting with
16the date of hire of a new employee during the incentive period.
17Eligibility for the credit does not depend on the continuous
18employment of any particular individual. For purposes of this
19subsection (f), if a new employee ceases to be employed before
20the completion of the 12-month period for any reason, the net
21increase in the number of full-time Illinois employees shall be
22treated as continuous if a different new employee is hired as a
23replacement within a reasonable time for the same position.
24(Source: P.A. 96-888, eff. 4-13-10.)
 
25    (35 ILCS 25/35)

 

 

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1    Sec. 35. Application for award of tax credit; tax credit
2certificate.
3    (a) On or after the conclusion of the 12-month period (or
46-month period, for purposes of subparagraph (A) of item (1) of
5subsection (a) of Section 25) after a new employee has been
6hired, an applicant shall file with the Department an
7application for award of a credit. The application shall
8include the following:
9        (1) The names, Social Security numbers, job
10    descriptions, salary or wage rates, and dates of hire of
11    the new employees with respect to whom the credit is being
12    requested, and an indication of whether each new employee
13    listed participated as a worker-trainee in the Put Illinois
14    to Work Program.
15        (2) A certification that each new employee listed has
16    been retained on the job for one year (or 6 months, for
17    purposes of subparagraph (A) of item (1) of subsection (a)
18    of Section 25) from the date of hire.
19        (3) The number of new employees hired by the applicant
20    during the incentive period.
21        (4) The net increase in the number of full-time
22    Illinois employees of the applicant (including the new
23    employees listed in the request) between the beginning of
24    the incentive period and the dates on which the new
25    employees listed in the request were hired. This
26    requirement does not apply for tax credits the applicant is

 

 

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1    seeking because the new employee had participated as a
2    worker-trainee in the Put Illinois to Work Program.
3        (5) An agreement that the Director is authorized to
4    verify with the appropriate State agencies the information
5    contained in the request before issuing a certificate to
6    the applicant.
7        (6) Any other information the Department determines to
8    be appropriate.
9    (b) Although an application may be filed at any time after
10the conclusion of the 12-month period (or 6-month period, for
11purposes of subparagraph (A) of item (1) of subsection (a) of
12Section 25) after a new employee was hired, an application
13filed more than 90 days after the earliest date on which it
14could have been filed shall not be awarded any credit if, prior
15to the date it is filed, the Department has received
16applications under this Section for credits totaling more than
17$50,000,000.
18    (c) The Department shall issue a certificate to each
19applicant awarded a credit under this Act. The certificate
20shall include the following:
21        (1) The name and taxpayer identification number of the
22    applicant.
23        (2) The date on which the certificate is issued.
24        (3) The credit amount that will be allowed.
25        (4) Any other information the Department determines to
26    be appropriate.

 

 

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1(Source: P.A. 96-888, eff. 4-13-10.)
 
2    Section 99. Effective date. This Act takes effect upon
3becoming law.".