Full Text of SB2505 96th General Assembly
SB2505ham002 96TH GENERAL ASSEMBLY | Rep. Barbara Flynn Currie Filed: 1/10/2011
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| 1 | | AMENDMENT TO SENATE BILL 2505
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 2505, AS AMENDED, | 3 | | by replacing everything after the enacting clause with the | 4 | | following:
| 5 | | "Section 1. This Act shall be known as the Taxpayer | 6 | | Accountability and Budget Stabilization Act. | 7 | | Section 5. The Secretary of State Act is amended by | 8 | | changing Section 5 as follows:
| 9 | | (15 ILCS 305/5) (from Ch. 124, par. 5)
| 10 | | Sec. 5. It shall be the duty of the Secretary of State:
| 11 | | 1. To countersign and affix the seal of state to all | 12 | | commissions
required by law to be issued by the Governor.
| 13 | | 2. To make a register of all appointments by the Governor, | 14 | | specifying
the person appointed, the office conferred, the date | 15 | | of the appointment,
the date when bond or oath is taken and the |
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| 1 | | date filed. If Senate
confirmation is required, the date of the | 2 | | confirmation shall be included
in the register.
| 3 | | 3. To make proper indexes to public acts, resolutions, | 4 | | papers and
documents in his office.
| 5 | | 3-a. To review all rules of all State agencies adopted in | 6 | | compliance
with the
codification system prescribed by the | 7 | | Secretary. The review shall be for the
purposes and include all | 8 | | the powers and duties provided in the Illinois
Administrative | 9 | | Procedure Act. The Secretary of State shall cooperate with the
| 10 | | Legislative Information System to insure the accuracy of the | 11 | | text of the rules
maintained under the Legislative Information | 12 | | System Act.
| 13 | | 4. To give any person requiring the same paying the lawful | 14 | | fees
therefor, a copy of any law, act, resolution, record or | 15 | | paper in his
office, and attach thereto his certificate, under | 16 | | the seal of the state.
| 17 | | 5. To take charge of and preserve from waste, and keep in | 18 | | repair,
the houses, lots, grounds and appurtenances, situated | 19 | | in the City of
Springfield, and belonging to or occupied by the | 20 | | State, the care of
which is not otherwise provided for by law, | 21 | | and to take charge of and
preserve from waste, and keep in | 22 | | repair, the houses, lots, grounds and
appurtenances, situated | 23 | | in the State outside the City of Springfield
where such houses, | 24 | | lots, grounds and appurtenances are occupied by the
Secretary | 25 | | of State and no other State officer or agency.
| 26 | | 6. To supervise the distribution of the laws.
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| 1 | | 7. To perform such other duties as may be required by law. | 2 | | The
Secretary of State may, within appropriations authorized by | 3 | | the General
Assembly, maintain offices in the State Capital and | 4 | | in such other places
in the State as he may deem necessary to | 5 | | properly carry out the powers
and duties vested in him by law.
| 6 | | 8. In addition to all other authority granted to the | 7 | | Secretary by law, subject to appropriation, to make grants or | 8 | | otherwise provide assistance to, among others without | 9 | | limitation, units of local government, school districts, | 10 | | educational institutions, private agencies, not-for-profit | 11 | | organizations, and for-profit entities for the health, safety, | 12 | | and welfare of Illinois residents for purposes related to | 13 | | education, transportation, construction, capital improvements, | 14 | | social services, and any other lawful public purpose. Upon | 15 | | request of the Secretary, all State agencies are mandated to | 16 | | provide the Secretary with assistance in administering the | 17 | | grants. | 18 | | 9. To notify the Auditor General of any Public Act filed | 19 | | with the Office of the Secretary of State making an | 20 | | appropriation or transfer of funds from the State treasury. | 21 | | This paragraph (9) applies only through June 30, 2015. | 22 | | (Source: P.A. 96-37, eff. 7-13-09.)
| 23 | | Section 10. The Illinois State Auditing Act is amended by | 24 | | adding Section 3-20 as follows: |
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| 1 | | (30 ILCS 5/3-20 new) | 2 | | Sec. 3-20. Spending limitation reports. The Auditor | 3 | | General shall issue reports in accordance with Section 201.5 of | 4 | | the Illinois Income Tax Act. This Section applies through June | 5 | | 30, 2015 or the effective date of a reduction in the rate of | 6 | | tax imposed by subsections (a) and (b) of Section 201 of the | 7 | | Illinois Income Tax Act pursuant to Section 201.5 of the | 8 | | Illinois Income Tax Act, whichever is earlier. | 9 | | Section 15. The State Finance Act is amended by adding | 10 | | Sections 5.786, 5.787, 5.788, 6z-85, 6z-86, 6z-87, and 25.2 as | 11 | | follows: | 12 | | (30 ILCS 105/5.786 new) | 13 | | Sec. 5.786. The Fund for the Advancement of Education. | 14 | | (30 ILCS 105/5.787 new) | 15 | | Sec. 5.787. The Property Tax Rebate Trust Fund. | 16 | | (30 ILCS 105/5.788 new) | 17 | | Sec. 5.788. The Commitment to Human Services Fund. | 18 | | (30 ILCS 105/6z-85 new) | 19 | | Sec. 6z-85. The Fund for the Advancement of Education; | 20 | | creation. The Fund for the Advancement of Education is hereby | 21 | | created as a special fund in the State treasury. All moneys |
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| 1 | | deposited into the fund shall be
appropriated to provide | 2 | | financial assistance for education programs. Moneys | 3 | | appropriated from the Fund shall supplement and not supplant | 4 | | the current level of education funding. | 5 | | (30 ILCS 105/6z-86 new) | 6 | | Sec. 6z-86. The Property Tax Rebate Trust Fund; uses. | 7 | | (a) The Property Tax Rebate Trust Fund is hereby created as | 8 | | a special fund in the State treasury. Moneys in the Fund shall | 9 | | be used to pay rebates as provided in this Section. Beginning | 10 | | in 2012, as soon as practical after July 15 of each year, the | 11 | | Department of Revenue shall pay a rebate to each taxpayer who | 12 | | files, no later than April 15 of that year, an individual | 13 | | income tax return in the State for a taxable year beginning in | 14 | | the previous calendar year and was responsible for paying real | 15 | | property taxes on his or her principal residence located in the | 16 | | State during the taxable year. Persons filing a joint return | 17 | | shall be treated as one taxpayer, and only one rebate may be | 18 | | issued per residence each year. The amount of the property tax | 19 | | rebate shall be equal to the balance of the Property Tax Rebate | 20 | | Trust Fund as of July 1 of the calendar year divided by the | 21 | | number of eligible taxpayers, rounded to the next lowest dollar | 22 | | amount. The Department of Revenue shall certify the name of | 23 | | each taxpayer who is eligible for a rebate under this Section. | 24 | | The State Comptroller shall mail the rebate warrants to these | 25 | | taxpayers as soon as practical after receipt of the |
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| 1 | | certification from the Department of Revenue. The Comptroller | 2 | | shall include a notice with the rebate warrant advising the | 3 | | taxpayer that the rebate is being provided as a result of the | 4 | | Taxpayer Accountability and Budget Stabilization Act passed by | 5 | | the General Assembly and signed into law by the Governor. | 6 | | (b) Any rebate payment that is returned or otherwise is not | 7 | | cashed shall be redeposited into the Fund. | 8 | | (c) If the rate of tax imposed by subsections (a) and (b) | 9 | | of Section 201 of the Illinois Income Tax Act is reduced | 10 | | pursuant to Section 201.5 of the Illinois Income Tax Act, the | 11 | | Department of Revenue shall not make a certification and the | 12 | | Comptroller shall not issue warrants under this Section on or | 13 | | after the effective date of the reduction. | 14 | | (30 ILCS 105/6z-87 new) | 15 | | Sec. 6z-87. The Commitment to Human Services Fund; uses. | 16 | | The Commitment to Human Services Fund is hereby created as a | 17 | | special fund in the State treasury. All moneys deposited into | 18 | | the fund shall be appropriated to provide financial assistance | 19 | | for community-based human service providers and for State | 20 | | funded human service programs. Moneys appropriated from the | 21 | | Fund shall supplement and not supplant the current level of | 22 | | human services funding. | 23 | | (30 ILCS 105/25.2 new) | 24 | | Sec. 25.2. Statutory mandates not designated in law as |
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| 1 | | being subject to appropriation. Notwithstanding any law to the | 2 | | contrary, from the effective date of this Section through | 3 | | fiscal year 2015, with respect to any statutory mandate that is | 4 | | not designated in law as being subject to appropriation, if and | 5 | | only if the Governor determines that funds appropriated for | 6 | | such statutory mandates are insufficient to satisfy those | 7 | | mandates, the Governor may reduce the amount of funds | 8 | | appropriated for some or all of those statutory mandates in | 9 | | amounts he or she deems necessary to accommodate budgetary | 10 | | limitations while attempting to implement such mandates to the | 11 | | extent reasonably practical. The reduction shall become | 12 | | effective upon the Governor giving notice of the reduction to | 13 | | the Speaker of the House of Representatives, the President of | 14 | | the Senate, the Minority Leader of the House of | 15 | | Representatives, the Minority Leader of the Senate, the State | 16 | | Comptroller, the State Treasurer, and the Commission on | 17 | | Government Forecasting and Accountability. Nothing in this | 18 | | Section prohibits adjustments to the Governor's reduction by | 19 | | law. | 20 | | Section 20. The Illinois Income Tax Act is amended by | 21 | | changing Sections 201, 207, 208, 208.1, 804, and 901 and by | 22 | | adding Sections 201.5, 202.5, and 517 as follows: | 23 | | (35 ILCS 5/201) (from Ch. 120, par. 2-201) | 24 | | Sec. 201. Tax Imposed. |
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| 1 | | (a) In general. A tax measured by net income is hereby | 2 | | imposed on every
individual, corporation, trust and estate for | 3 | | each taxable year ending
after July 31, 1969 on the privilege | 4 | | of earning or receiving income in or
as a resident of this | 5 | | State. Such tax shall be in addition to all other
occupation or | 6 | | privilege taxes imposed by this State or by any municipal
| 7 | | corporation or political subdivision thereof. | 8 | | (b) Rates. The tax imposed by subsection (a) of this | 9 | | Section shall be
determined as follows, except as adjusted by | 10 | | subsection (d-1): | 11 | | (1) In the case of an individual, trust or estate, for | 12 | | taxable years
ending prior to July 1, 1989, an amount equal | 13 | | to 2 1/2% of the taxpayer's
net income for the taxable | 14 | | year. | 15 | | (2) In the case of an individual, trust or estate, for | 16 | | taxable years
beginning prior to July 1, 1989 and ending | 17 | | after June 30, 1989, an amount
equal to the sum of (i) 2 | 18 | | 1/2% of the taxpayer's net income for the period
prior to | 19 | | July 1, 1989, as calculated under Section 202.3, and (ii) | 20 | | 3% of the
taxpayer's net income for the period after June | 21 | | 30, 1989, as calculated
under Section 202.3. | 22 | | (3) In the case of an individual, trust or estate, for | 23 | | taxable years
beginning after June 30, 1989, and ending | 24 | | prior to January 1, 2011, an amount equal to 3% of the | 25 | | taxpayer's net
income for the taxable year. | 26 | | (4) In the case of an individual, trust, or estate, for |
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| 1 | | taxable years beginning prior to January 1, 2011, and | 2 | | ending after December 31, 2010, an amount equal to the sum | 3 | | of (i) 3% of the taxpayer's net income for the period prior | 4 | | to January 1, 2011, as calculated under Section 202.5, and | 5 | | (ii) 5% of the taxpayer's net income for the period after | 6 | | December 31, 2010, as calculated under Section 202.5. | 7 | | (Blank). | 8 | | (5) In the case of an individual, trust, or estate, for | 9 | | taxable years beginning on or after January 1, 2011, and | 10 | | ending prior to January 1, 2015, an amount equal to 5% of | 11 | | the taxpayer's net income for the taxable year. (Blank). | 12 | | (5.1) In the case of an individual, trust, or estate, | 13 | | for taxable years beginning prior to January 1, 2015, and | 14 | | ending after December 31, 2014, an amount equal to the sum | 15 | | of (i) 5% of the taxpayer's net income for the period prior | 16 | | to January 1, 2015, as calculated under Section 202.5, and | 17 | | (ii) 4% of the taxpayer's net income for the period after | 18 | | December 31, 2014, as calculated under Section 202.5. | 19 | | (5.2) In the case of an individual, trust, or estate, | 20 | | for taxable years beginning on or after January 1, 2015, | 21 | | and ending prior to January 1, 2025, an amount equal to 4% | 22 | | of the taxpayer's net income for the taxable year. | 23 | | (5.3) In the case of an individual, trust, or estate, | 24 | | for taxable years beginning prior to January 1, 2025, and | 25 | | ending after December 31, 2024, an amount equal to the sum | 26 | | of (i) 4% of the taxpayer's net income for the period prior |
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| 1 | | to January 1, 2025, as calculated under Section 202.5, and | 2 | | (ii) 3.5% of the taxpayer's net income for the period after | 3 | | December 31, 2024, as calculated under Section 202.5. | 4 | | (5.4) In the case of an individual, trust, or estate, | 5 | | for taxable years beginning on or after January 1, 2025, an | 6 | | amount equal to 3.5% of the taxpayer's net income for the | 7 | | taxable year. | 8 | | (6) In the case of a corporation, for taxable years
| 9 | | ending prior to July 1, 1989, an amount equal to 4% of the
| 10 | | taxpayer's net income for the taxable year. | 11 | | (7) In the case of a corporation, for taxable years | 12 | | beginning prior to
July 1, 1989 and ending after June 30, | 13 | | 1989, an amount equal to the sum of
(i) 4% of the | 14 | | taxpayer's net income for the period prior to July 1, 1989,
| 15 | | as calculated under Section 202.3, and (ii) 4.8% of the | 16 | | taxpayer's net
income for the period after June 30, 1989, | 17 | | as calculated under Section
202.3. | 18 | | (8) In the case of a corporation, for taxable years | 19 | | beginning after
June 30, 1989, and ending prior to January | 20 | | 1, 2011, an amount equal to 4.8% of the taxpayer's net | 21 | | income for the
taxable year. | 22 | | (9) In the case of a corporation, for taxable years | 23 | | beginning prior to January 1, 2011, and ending after | 24 | | December 31, 2010, an amount equal to the sum of (i) 4.8% | 25 | | of the taxpayer's net income for the period prior to | 26 | | January 1, 2011, as calculated under Section 202.5, and |
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| 1 | | (ii) 7% of the taxpayer's net income for the period after | 2 | | December 31, 2010, as calculated under Section 202.5. | 3 | | (10) In the case of a corporation, for taxable years | 4 | | beginning on or after January 1, 2011, and ending prior to | 5 | | January 1, 2015, an amount equal to 7% of the taxpayer's | 6 | | net income for the taxable year. | 7 | | (11) In the case of a corporation, for taxable years | 8 | | beginning prior to January 1, 2015, and ending after | 9 | | December 31, 2014, an amount equal to the sum of (i) 7% of | 10 | | the taxpayer's net income for the period prior to January | 11 | | 1, 2015, as calculated under Section 202.5, and (ii) 5.6% | 12 | | of the taxpayer's net income for the period after December | 13 | | 31, 2014, as calculated under Section 202.5. | 14 | | (12) In the case of a corporation, for taxable years | 15 | | beginning on or after January 1, 2015, and ending prior to | 16 | | January 1, 2025, an amount equal to 5.6% of the taxpayer's | 17 | | net income for the taxable year. | 18 | | (13) In the case of a corporation, for taxable years | 19 | | beginning prior to January 1, 2025, and ending after | 20 | | December 31, 2024, an amount equal to the sum of (i) 5.6% | 21 | | of the taxpayer's net income for the period prior to | 22 | | January 1, 2025, as calculated under Section 202.5, and | 23 | | (ii) 4.9% of the taxpayer's net income for the period after | 24 | | December 31, 2024, as calculated under Section 202.5. | 25 | | (14) In the case of a corporation, for taxable years | 26 | | beginning on or after January 1, 2025, an amount equal to |
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| 1 | | 4.9% of the taxpayer's net income for the taxable year. | 2 | | The rates under this subsection (b) are subject to the | 3 | | provisions of Section 201.5. | 4 | | (c) Personal Property Tax Replacement Income Tax.
| 5 | | Beginning on July 1, 1979 and thereafter, in addition to such | 6 | | income
tax, there is also hereby imposed the Personal Property | 7 | | Tax Replacement
Income Tax measured by net income on every | 8 | | corporation (including Subchapter
S corporations), partnership | 9 | | and trust, for each taxable year ending after
June 30, 1979. | 10 | | Such taxes are imposed on the privilege of earning or
receiving | 11 | | income in or as a resident of this State. The Personal Property
| 12 | | Tax Replacement Income Tax shall be in addition to the income | 13 | | tax imposed
by subsections (a) and (b) of this Section and in | 14 | | addition to all other
occupation or privilege taxes imposed by | 15 | | this State or by any municipal
corporation or political | 16 | | subdivision thereof. | 17 | | (d) Additional Personal Property Tax Replacement Income | 18 | | Tax Rates.
The personal property tax replacement income tax | 19 | | imposed by this subsection
and subsection (c) of this Section | 20 | | in the case of a corporation, other
than a Subchapter S | 21 | | corporation and except as adjusted by subsection (d-1),
shall | 22 | | be an additional amount equal to
2.85% of such taxpayer's net | 23 | | income for the taxable year, except that
beginning on January | 24 | | 1, 1981, and thereafter, the rate of 2.85% specified
in this | 25 | | subsection shall be reduced to 2.5%, and in the case of a
| 26 | | partnership, trust or a Subchapter S corporation shall be an |
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| 1 | | additional
amount equal to 1.5% of such taxpayer's net income | 2 | | for the taxable year. | 3 | | (d-1) Rate reduction for certain foreign insurers. In the | 4 | | case of a
foreign insurer, as defined by Section 35A-5 of the | 5 | | Illinois Insurance Code,
whose state or country of domicile | 6 | | imposes on insurers domiciled in Illinois
a retaliatory tax | 7 | | (excluding any insurer
whose premiums from reinsurance assumed | 8 | | are 50% or more of its total insurance
premiums as determined | 9 | | under paragraph (2) of subsection (b) of Section 304,
except | 10 | | that for purposes of this determination premiums from | 11 | | reinsurance do
not include premiums from inter-affiliate | 12 | | reinsurance arrangements),
beginning with taxable years ending | 13 | | on or after December 31, 1999,
the sum of
the rates of tax | 14 | | imposed by subsections (b) and (d) shall be reduced (but not
| 15 | | increased) to the rate at which the total amount of tax imposed | 16 | | under this Act,
net of all credits allowed under this Act, | 17 | | shall equal (i) the total amount of
tax that would be imposed | 18 | | on the foreign insurer's net income allocable to
Illinois for | 19 | | the taxable year by such foreign insurer's state or country of
| 20 | | domicile if that net income were subject to all income taxes | 21 | | and taxes
measured by net income imposed by such foreign | 22 | | insurer's state or country of
domicile, net of all credits | 23 | | allowed or (ii) a rate of zero if no such tax is
imposed on such | 24 | | income by the foreign insurer's state of domicile.
For the | 25 | | purposes of this subsection (d-1), an inter-affiliate includes | 26 | | a
mutual insurer under common management. |
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| 1 | | (1) For the purposes of subsection (d-1), in no event | 2 | | shall the sum of the
rates of tax imposed by subsections | 3 | | (b) and (d) be reduced below the rate at
which the sum of: | 4 | | (A) the total amount of tax imposed on such foreign | 5 | | insurer under
this Act for a taxable year, net of all | 6 | | credits allowed under this Act, plus | 7 | | (B) the privilege tax imposed by Section 409 of the | 8 | | Illinois Insurance
Code, the fire insurance company | 9 | | tax imposed by Section 12 of the Fire
Investigation | 10 | | Act, and the fire department taxes imposed under | 11 | | Section 11-10-1
of the Illinois Municipal Code, | 12 | | equals 1.25% for taxable years ending prior to December 31, | 13 | | 2003, or
1.75% for taxable years ending on or after | 14 | | December 31, 2003, of the net
taxable premiums written for | 15 | | the taxable year,
as described by subsection (1) of Section | 16 | | 409 of the Illinois Insurance Code.
This paragraph will in | 17 | | no event increase the rates imposed under subsections
(b) | 18 | | and (d). | 19 | | (2) Any reduction in the rates of tax imposed by this | 20 | | subsection shall be
applied first against the rates imposed | 21 | | by subsection (b) and only after the
tax imposed by | 22 | | subsection (a) net of all credits allowed under this | 23 | | Section
other than the credit allowed under subsection (i) | 24 | | has been reduced to zero,
against the rates imposed by | 25 | | subsection (d). | 26 | | This subsection (d-1) is exempt from the provisions of |
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| 1 | | Section 250. | 2 | | (e) Investment credit. A taxpayer shall be allowed a credit
| 3 | | against the Personal Property Tax Replacement Income Tax for
| 4 | | investment in qualified property. | 5 | | (1) A taxpayer shall be allowed a credit equal to .5% | 6 | | of
the basis of qualified property placed in service during | 7 | | the taxable year,
provided such property is placed in | 8 | | service on or after
July 1, 1984. There shall be allowed an | 9 | | additional credit equal
to .5% of the basis of qualified | 10 | | property placed in service during the
taxable year, | 11 | | provided such property is placed in service on or
after | 12 | | July 1, 1986, and the taxpayer's base employment
within | 13 | | Illinois has increased by 1% or more over the preceding | 14 | | year as
determined by the taxpayer's employment records | 15 | | filed with the
Illinois Department of Employment Security. | 16 | | Taxpayers who are new to
Illinois shall be deemed to have | 17 | | met the 1% growth in base employment for
the first year in | 18 | | which they file employment records with the Illinois
| 19 | | Department of Employment Security. The provisions added to | 20 | | this Section by
Public Act 85-1200 (and restored by Public | 21 | | Act 87-895) shall be
construed as declaratory of existing | 22 | | law and not as a new enactment. If,
in any year, the | 23 | | increase in base employment within Illinois over the
| 24 | | preceding year is less than 1%, the additional credit shall | 25 | | be limited to that
percentage times a fraction, the | 26 | | numerator of which is .5% and the denominator
of which is |
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| 1 | | 1%, but shall not exceed .5%. The investment credit shall | 2 | | not be
allowed to the extent that it would reduce a | 3 | | taxpayer's liability in any tax
year below zero, nor may | 4 | | any credit for qualified property be allowed for any
year | 5 | | other than the year in which the property was placed in | 6 | | service in
Illinois. For tax years ending on or after | 7 | | December 31, 1987, and on or
before December 31, 1988, the | 8 | | credit shall be allowed for the tax year in
which the | 9 | | property is placed in service, or, if the amount of the | 10 | | credit
exceeds the tax liability for that year, whether it | 11 | | exceeds the original
liability or the liability as later | 12 | | amended, such excess may be carried
forward and applied to | 13 | | the tax liability of the 5 taxable years following
the | 14 | | excess credit years if the taxpayer (i) makes investments | 15 | | which cause
the creation of a minimum of 2,000 full-time | 16 | | equivalent jobs in Illinois,
(ii) is located in an | 17 | | enterprise zone established pursuant to the Illinois
| 18 | | Enterprise Zone Act and (iii) is certified by the | 19 | | Department of Commerce
and Community Affairs (now | 20 | | Department of Commerce and Economic Opportunity) as | 21 | | complying with the requirements specified in
clause (i) and | 22 | | (ii) by July 1, 1986. The Department of Commerce and
| 23 | | Community Affairs (now Department of Commerce and Economic | 24 | | Opportunity) shall notify the Department of Revenue of all | 25 | | such
certifications immediately. For tax years ending | 26 | | after December 31, 1988,
the credit shall be allowed for |
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| 1 | | the tax year in which the property is
placed in service, | 2 | | or, if the amount of the credit exceeds the tax
liability | 3 | | for that year, whether it exceeds the original liability or | 4 | | the
liability as later amended, such excess may be carried | 5 | | forward and applied
to the tax liability of the 5 taxable | 6 | | years following the excess credit
years. The credit shall | 7 | | be applied to the earliest year for which there is
a | 8 | | liability. If there is credit from more than one tax year | 9 | | that is
available to offset a liability, earlier credit | 10 | | shall be applied first. | 11 | | (2) The term "qualified property" means property | 12 | | which: | 13 | | (A) is tangible, whether new or used, including | 14 | | buildings and structural
components of buildings and | 15 | | signs that are real property, but not including
land or | 16 | | improvements to real property that are not a structural | 17 | | component of a
building such as landscaping, sewer | 18 | | lines, local access roads, fencing, parking
lots, and | 19 | | other appurtenances; | 20 | | (B) is depreciable pursuant to Section 167 of the | 21 | | Internal Revenue Code,
except that "3-year property" | 22 | | as defined in Section 168(c)(2)(A) of that
Code is not | 23 | | eligible for the credit provided by this subsection | 24 | | (e); | 25 | | (C) is acquired by purchase as defined in Section | 26 | | 179(d) of
the Internal Revenue Code; |
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| 1 | | (D) is used in Illinois by a taxpayer who is | 2 | | primarily engaged in
manufacturing, or in mining coal | 3 | | or fluorite, or in retailing, or was placed in service | 4 | | on or after July 1, 2006 in a River Edge Redevelopment | 5 | | Zone established pursuant to the River Edge | 6 | | Redevelopment Zone Act; and | 7 | | (E) has not previously been used in Illinois in | 8 | | such a manner and by
such a person as would qualify for | 9 | | the credit provided by this subsection
(e) or | 10 | | subsection (f). | 11 | | (3) For purposes of this subsection (e), | 12 | | "manufacturing" means
the material staging and production | 13 | | of tangible personal property by
procedures commonly | 14 | | regarded as manufacturing, processing, fabrication, or
| 15 | | assembling which changes some existing material into new | 16 | | shapes, new
qualities, or new combinations. For purposes of | 17 | | this subsection
(e) the term "mining" shall have the same | 18 | | meaning as the term "mining" in
Section 613(c) of the | 19 | | Internal Revenue Code. For purposes of this subsection
(e), | 20 | | the term "retailing" means the sale of tangible personal | 21 | | property for use or consumption and not for resale, or
| 22 | | services rendered in conjunction with the sale of tangible | 23 | | personal property for use or consumption and not for | 24 | | resale. For purposes of this subsection (e), "tangible | 25 | | personal property" has the same meaning as when that term | 26 | | is used in the Retailers' Occupation Tax Act, and, for |
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| 1 | | taxable years ending after December 31, 2008, does not | 2 | | include the generation, transmission, or distribution of | 3 | | electricity. | 4 | | (4) The basis of qualified property shall be the basis
| 5 | | used to compute the depreciation deduction for federal | 6 | | income tax purposes. | 7 | | (5) If the basis of the property for federal income tax | 8 | | depreciation
purposes is increased after it has been placed | 9 | | in service in Illinois by
the taxpayer, the amount of such | 10 | | increase shall be deemed property placed
in service on the | 11 | | date of such increase in basis. | 12 | | (6) The term "placed in service" shall have the same
| 13 | | meaning as under Section 46 of the Internal Revenue Code. | 14 | | (7) If during any taxable year, any property ceases to
| 15 | | be qualified property in the hands of the taxpayer within | 16 | | 48 months after
being placed in service, or the situs of | 17 | | any qualified property is
moved outside Illinois within 48 | 18 | | months after being placed in service, the
Personal Property | 19 | | Tax Replacement Income Tax for such taxable year shall be
| 20 | | increased. Such increase shall be determined by (i) | 21 | | recomputing the
investment credit which would have been | 22 | | allowed for the year in which
credit for such property was | 23 | | originally allowed by eliminating such
property from such | 24 | | computation and, (ii) subtracting such recomputed credit
| 25 | | from the amount of credit previously allowed. For the | 26 | | purposes of this
paragraph (7), a reduction of the basis of |
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| 1 | | qualified property resulting
from a redetermination of the | 2 | | purchase price shall be deemed a disposition
of qualified | 3 | | property to the extent of such reduction. | 4 | | (8) Unless the investment credit is extended by law, | 5 | | the
basis of qualified property shall not include costs | 6 | | incurred after
December 31, 2013, except for costs incurred | 7 | | pursuant to a binding
contract entered into on or before | 8 | | December 31, 2013. | 9 | | (9) Each taxable year ending before December 31, 2000, | 10 | | a partnership may
elect to pass through to its
partners the | 11 | | credits to which the partnership is entitled under this | 12 | | subsection
(e) for the taxable year. A partner may use the | 13 | | credit allocated to him or her
under this paragraph only | 14 | | against the tax imposed in subsections (c) and (d) of
this | 15 | | Section. If the partnership makes that election, those | 16 | | credits shall be
allocated among the partners in the | 17 | | partnership in accordance with the rules
set forth in | 18 | | Section 704(b) of the Internal Revenue Code, and the rules
| 19 | | promulgated under that Section, and the allocated amount of | 20 | | the credits shall
be allowed to the partners for that | 21 | | taxable year. The partnership shall make
this election on | 22 | | its Personal Property Tax Replacement Income Tax return for
| 23 | | that taxable year. The election to pass through the credits | 24 | | shall be
irrevocable. | 25 | | For taxable years ending on or after December 31, 2000, | 26 | | a
partner that qualifies its
partnership for a subtraction |
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| 1 | | under subparagraph (I) of paragraph (2) of
subsection (d) | 2 | | of Section 203 or a shareholder that qualifies a Subchapter | 3 | | S
corporation for a subtraction under subparagraph (S) of | 4 | | paragraph (2) of
subsection (b) of Section 203 shall be | 5 | | allowed a credit under this subsection
(e) equal to its | 6 | | share of the credit earned under this subsection (e) during
| 7 | | the taxable year by the partnership or Subchapter S | 8 | | corporation, determined in
accordance with the | 9 | | determination of income and distributive share of
income | 10 | | under Sections 702 and 704 and Subchapter S of the Internal | 11 | | Revenue
Code. This paragraph is exempt from the provisions | 12 | | of Section 250. | 13 | | (f) Investment credit; Enterprise Zone; River Edge | 14 | | Redevelopment Zone. | 15 | | (1) A taxpayer shall be allowed a credit against the | 16 | | tax imposed
by subsections (a) and (b) of this Section for | 17 | | investment in qualified
property which is placed in service | 18 | | in an Enterprise Zone created
pursuant to the Illinois | 19 | | Enterprise Zone Act or, for property placed in service on | 20 | | or after July 1, 2006, a River Edge Redevelopment Zone | 21 | | established pursuant to the River Edge Redevelopment Zone | 22 | | Act. For partners, shareholders
of Subchapter S | 23 | | corporations, and owners of limited liability companies,
| 24 | | if the liability company is treated as a partnership for | 25 | | purposes of
federal and State income taxation, there shall | 26 | | be allowed a credit under
this subsection (f) to be |
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| 1 | | determined in accordance with the determination
of income | 2 | | and distributive share of income under Sections 702 and 704 | 3 | | and
Subchapter S of the Internal Revenue Code. The credit | 4 | | shall be .5% of the
basis for such property. The credit | 5 | | shall be available only in the taxable
year in which the | 6 | | property is placed in service in the Enterprise Zone or | 7 | | River Edge Redevelopment Zone and
shall not be allowed to | 8 | | the extent that it would reduce a taxpayer's
liability for | 9 | | the tax imposed by subsections (a) and (b) of this Section | 10 | | to
below zero. For tax years ending on or after December | 11 | | 31, 1985, the credit
shall be allowed for the tax year in | 12 | | which the property is placed in
service, or, if the amount | 13 | | of the credit exceeds the tax liability for that
year, | 14 | | whether it exceeds the original liability or the liability | 15 | | as later
amended, such excess may be carried forward and | 16 | | applied to the tax
liability of the 5 taxable years | 17 | | following the excess credit year.
The credit shall be | 18 | | applied to the earliest year for which there is a
| 19 | | liability. If there is credit from more than one tax year | 20 | | that is available
to offset a liability, the credit | 21 | | accruing first in time shall be applied
first. | 22 | | (2) The term qualified property means property which: | 23 | | (A) is tangible, whether new or used, including | 24 | | buildings and
structural components of buildings; | 25 | | (B) is depreciable pursuant to Section 167 of the | 26 | | Internal Revenue
Code, except that "3-year property" |
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| 1 | | as defined in Section 168(c)(2)(A) of
that Code is not | 2 | | eligible for the credit provided by this subsection | 3 | | (f); | 4 | | (C) is acquired by purchase as defined in Section | 5 | | 179(d) of
the Internal Revenue Code; | 6 | | (D) is used in the Enterprise Zone or River Edge | 7 | | Redevelopment Zone by the taxpayer; and | 8 | | (E) has not been previously used in Illinois in | 9 | | such a manner and by
such a person as would qualify for | 10 | | the credit provided by this subsection
(f) or | 11 | | subsection (e). | 12 | | (3) The basis of qualified property shall be the basis | 13 | | used to compute
the depreciation deduction for federal | 14 | | income tax purposes. | 15 | | (4) If the basis of the property for federal income tax | 16 | | depreciation
purposes is increased after it has been placed | 17 | | in service in the Enterprise
Zone or River Edge | 18 | | Redevelopment Zone by the taxpayer, the amount of such | 19 | | increase shall be deemed property
placed in service on the | 20 | | date of such increase in basis. | 21 | | (5) The term "placed in service" shall have the same | 22 | | meaning as under
Section 46 of the Internal Revenue Code. | 23 | | (6) If during any taxable year, any property ceases to | 24 | | be qualified
property in the hands of the taxpayer within | 25 | | 48 months after being placed
in service, or the situs of | 26 | | any qualified property is moved outside the
Enterprise Zone |
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| 1 | | or River Edge Redevelopment Zone within 48 months after | 2 | | being placed in service, the tax
imposed under subsections | 3 | | (a) and (b) of this Section for such taxable year
shall be | 4 | | increased. Such increase shall be determined by (i) | 5 | | recomputing
the investment credit which would have been | 6 | | allowed for the year in which
credit for such property was | 7 | | originally allowed by eliminating such
property from such | 8 | | computation, and (ii) subtracting such recomputed credit
| 9 | | from the amount of credit previously allowed. For the | 10 | | purposes of this
paragraph (6), a reduction of the basis of | 11 | | qualified property resulting
from a redetermination of the | 12 | | purchase price shall be deemed a disposition
of qualified | 13 | | property to the extent of such reduction. | 14 | | (7) There shall be allowed an additional credit equal | 15 | | to 0.5% of the basis of qualified property placed in | 16 | | service during the taxable year in a River Edge | 17 | | Redevelopment Zone, provided such property is placed in | 18 | | service on or after July 1, 2006, and the taxpayer's base | 19 | | employment within Illinois has increased by 1% or more over | 20 | | the preceding year as determined by the taxpayer's | 21 | | employment records filed with the Illinois Department of | 22 | | Employment Security. Taxpayers who are new to Illinois | 23 | | shall be deemed to have met the 1% growth in base | 24 | | employment for the first year in which they file employment | 25 | | records with the Illinois Department of Employment | 26 | | Security. If, in any year, the increase in base employment |
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| 1 | | within Illinois over the preceding year is less than 1%, | 2 | | the additional credit shall be limited to that percentage | 3 | | times a fraction, the numerator of which is 0.5% and the | 4 | | denominator of which is 1%, but shall not exceed 0.5%.
| 5 | | (g) Jobs Tax Credit; Enterprise Zone, River Edge | 6 | | Redevelopment Zone, and Foreign Trade Zone or Sub-Zone. | 7 | | (1) A taxpayer conducting a trade or business in an | 8 | | enterprise zone
or a High Impact Business designated by the | 9 | | Department of Commerce and
Economic Opportunity or for | 10 | | taxable years ending on or after December 31, 2006, in a | 11 | | River Edge Redevelopment Zone conducting a trade or | 12 | | business in a federally designated
Foreign Trade Zone or | 13 | | Sub-Zone shall be allowed a credit against the tax
imposed | 14 | | by subsections (a) and (b) of this Section in the amount of | 15 | | $500
per eligible employee hired to work in the zone during | 16 | | the taxable year. | 17 | | (2) To qualify for the credit: | 18 | | (A) the taxpayer must hire 5 or more eligible | 19 | | employees to work in an
enterprise zone, River Edge | 20 | | Redevelopment Zone, or federally designated Foreign | 21 | | Trade Zone or Sub-Zone
during the taxable year; | 22 | | (B) the taxpayer's total employment within the | 23 | | enterprise zone, River Edge Redevelopment Zone, or
| 24 | | federally designated Foreign Trade Zone or Sub-Zone | 25 | | must
increase by 5 or more full-time employees beyond | 26 | | the total employed in that
zone at the end of the |
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| 1 | | previous tax year for which a jobs tax
credit under | 2 | | this Section was taken, or beyond the total employed by | 3 | | the
taxpayer as of December 31, 1985, whichever is | 4 | | later; and | 5 | | (C) the eligible employees must be employed 180 | 6 | | consecutive days in
order to be deemed hired for | 7 | | purposes of this subsection. | 8 | | (3) An "eligible employee" means an employee who is: | 9 | | (A) Certified by the Department of Commerce and | 10 | | Economic Opportunity
as "eligible for services" | 11 | | pursuant to regulations promulgated in
accordance with | 12 | | Title II of the Job Training Partnership Act, Training
| 13 | | Services for the Disadvantaged or Title III of the Job | 14 | | Training Partnership
Act, Employment and Training | 15 | | Assistance for Dislocated Workers Program. | 16 | | (B) Hired after the enterprise zone, River Edge | 17 | | Redevelopment Zone, or federally designated Foreign
| 18 | | Trade Zone or Sub-Zone was designated or the trade or
| 19 | | business was located in that zone, whichever is later. | 20 | | (C) Employed in the enterprise zone, River Edge | 21 | | Redevelopment Zone, or Foreign Trade Zone or
Sub-Zone. | 22 | | An employee is employed in an
enterprise zone or | 23 | | federally designated Foreign Trade Zone or Sub-Zone
if | 24 | | his services are rendered there or it is the base of
| 25 | | operations for the services performed. | 26 | | (D) A full-time employee working 30 or more hours |
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| 1 | | per week. | 2 | | (4) For tax years ending on or after December 31, 1985 | 3 | | and prior to
December 31, 1988, the credit shall be allowed | 4 | | for the tax year in which
the eligible employees are hired. | 5 | | For tax years ending on or after
December 31, 1988, the | 6 | | credit shall be allowed for the tax year immediately
| 7 | | following the tax year in which the eligible employees are | 8 | | hired. If the
amount of the credit exceeds the tax | 9 | | liability for that year, whether it
exceeds the original | 10 | | liability or the liability as later amended, such
excess | 11 | | may be carried forward and applied to the tax liability of | 12 | | the 5
taxable years following the excess credit year. The | 13 | | credit shall be
applied to the earliest year for which | 14 | | there is a liability. If there is
credit from more than one | 15 | | tax year that is available to offset a liability,
earlier | 16 | | credit shall be applied first. | 17 | | (5) The Department of Revenue shall promulgate such | 18 | | rules and regulations
as may be deemed necessary to carry | 19 | | out the purposes of this subsection (g). | 20 | | (6) The credit shall be available for eligible | 21 | | employees hired on or
after January 1, 1986. | 22 | | (h) Investment credit; High Impact Business. | 23 | | (1) Subject to subsections (b) and (b-5) of Section
5.5 | 24 | | of the Illinois Enterprise Zone Act, a taxpayer shall be | 25 | | allowed a credit
against the tax imposed by subsections (a) | 26 | | and (b) of this Section for
investment in qualified
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| 1 | | property which is placed in service by a Department of | 2 | | Commerce and Economic Opportunity
designated High Impact | 3 | | Business. The credit shall be .5% of the basis
for such | 4 | | property. The credit shall not be available (i) until the | 5 | | minimum
investments in qualified property set forth in | 6 | | subdivision (a)(3)(A) of
Section 5.5 of the Illinois
| 7 | | Enterprise Zone Act have been satisfied
or (ii) until the | 8 | | time authorized in subsection (b-5) of the Illinois
| 9 | | Enterprise Zone Act for entities designated as High Impact | 10 | | Businesses under
subdivisions (a)(3)(B), (a)(3)(C), and | 11 | | (a)(3)(D) of Section 5.5 of the Illinois
Enterprise Zone | 12 | | Act, and shall not be allowed to the extent that it would
| 13 | | reduce a taxpayer's liability for the tax imposed by | 14 | | subsections (a) and (b) of
this Section to below zero. The | 15 | | credit applicable to such investments shall be
taken in the | 16 | | taxable year in which such investments have been completed. | 17 | | The
credit for additional investments beyond the minimum | 18 | | investment by a designated
high impact business authorized | 19 | | under subdivision (a)(3)(A) of Section 5.5 of
the Illinois | 20 | | Enterprise Zone Act shall be available only in the taxable | 21 | | year in
which the property is placed in service and shall | 22 | | not be allowed to the extent
that it would reduce a | 23 | | taxpayer's liability for the tax imposed by subsections
(a) | 24 | | and (b) of this Section to below zero.
For tax years ending | 25 | | on or after December 31, 1987, the credit shall be
allowed | 26 | | for the tax year in which the property is placed in |
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| 1 | | service, or, if
the amount of the credit exceeds the tax | 2 | | liability for that year, whether
it exceeds the original | 3 | | liability or the liability as later amended, such
excess | 4 | | may be carried forward and applied to the tax liability of | 5 | | the 5
taxable years following the excess credit year. The | 6 | | credit shall be
applied to the earliest year for which | 7 | | there is a liability. If there is
credit from more than one | 8 | | tax year that is available to offset a liability,
the | 9 | | credit accruing first in time shall be applied first. | 10 | | Changes made in this subdivision (h)(1) by Public Act | 11 | | 88-670
restore changes made by Public Act 85-1182 and | 12 | | reflect existing law. | 13 | | (2) The term qualified property means property which: | 14 | | (A) is tangible, whether new or used, including | 15 | | buildings and
structural components of buildings; | 16 | | (B) is depreciable pursuant to Section 167 of the | 17 | | Internal Revenue
Code, except that "3-year property" | 18 | | as defined in Section 168(c)(2)(A) of
that Code is not | 19 | | eligible for the credit provided by this subsection | 20 | | (h); | 21 | | (C) is acquired by purchase as defined in Section | 22 | | 179(d) of the
Internal Revenue Code; and | 23 | | (D) is not eligible for the Enterprise Zone | 24 | | Investment Credit provided
by subsection (f) of this | 25 | | Section. | 26 | | (3) The basis of qualified property shall be the basis |
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| 1 | | used to compute
the depreciation deduction for federal | 2 | | income tax purposes. | 3 | | (4) If the basis of the property for federal income tax | 4 | | depreciation
purposes is increased after it has been placed | 5 | | in service in a federally
designated Foreign Trade Zone or | 6 | | Sub-Zone located in Illinois by the taxpayer,
the amount of | 7 | | such increase shall be deemed property placed in service on
| 8 | | the date of such increase in basis. | 9 | | (5) The term "placed in service" shall have the same | 10 | | meaning as under
Section 46 of the Internal Revenue Code. | 11 | | (6) If during any taxable year ending on or before | 12 | | December 31, 1996,
any property ceases to be qualified
| 13 | | property in the hands of the taxpayer within 48 months | 14 | | after being placed
in service, or the situs of any | 15 | | qualified property is moved outside
Illinois within 48 | 16 | | months after being placed in service, the tax imposed
under | 17 | | subsections (a) and (b) of this Section for such taxable | 18 | | year shall
be increased. Such increase shall be determined | 19 | | by (i) recomputing the
investment credit which would have | 20 | | been allowed for the year in which
credit for such property | 21 | | was originally allowed by eliminating such
property from | 22 | | such computation, and (ii) subtracting such recomputed | 23 | | credit
from the amount of credit previously allowed. For | 24 | | the purposes of this
paragraph (6), a reduction of the | 25 | | basis of qualified property resulting
from a | 26 | | redetermination of the purchase price shall be deemed a |
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| 1 | | disposition
of qualified property to the extent of such | 2 | | reduction. | 3 | | (7) Beginning with tax years ending after December 31, | 4 | | 1996, if a
taxpayer qualifies for the credit under this | 5 | | subsection (h) and thereby is
granted a tax abatement and | 6 | | the taxpayer relocates its entire facility in
violation of | 7 | | the explicit terms and length of the contract under Section
| 8 | | 18-183 of the Property Tax Code, the tax imposed under | 9 | | subsections
(a) and (b) of this Section shall be increased | 10 | | for the taxable year
in which the taxpayer relocated its | 11 | | facility by an amount equal to the
amount of credit | 12 | | received by the taxpayer under this subsection (h). | 13 | | (i) Credit for Personal Property Tax Replacement Income | 14 | | Tax.
For tax years ending prior to December 31, 2003, a credit | 15 | | shall be allowed
against the tax imposed by
subsections (a) and | 16 | | (b) of this Section for the tax imposed by subsections (c)
and | 17 | | (d) of this Section. This credit shall be computed by | 18 | | multiplying the tax
imposed by subsections (c) and (d) of this | 19 | | Section by a fraction, the numerator
of which is base income | 20 | | allocable to Illinois and the denominator of which is
Illinois | 21 | | base income, and further multiplying the product by the tax | 22 | | rate
imposed by subsections (a) and (b) of this Section. | 23 | | Any credit earned on or after December 31, 1986 under
this | 24 | | subsection which is unused in the year
the credit is computed | 25 | | because it exceeds the tax liability imposed by
subsections (a) | 26 | | and (b) for that year (whether it exceeds the original
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| 1 | | liability or the liability as later amended) may be carried | 2 | | forward and
applied to the tax liability imposed by subsections | 3 | | (a) and (b) of the 5
taxable years following the excess credit | 4 | | year, provided that no credit may
be carried forward to any | 5 | | year ending on or
after December 31, 2003. This credit shall be
| 6 | | applied first to the earliest year for which there is a | 7 | | liability. If
there is a credit under this subsection from more | 8 | | than one tax year that is
available to offset a liability the | 9 | | earliest credit arising under this
subsection shall be applied | 10 | | first. | 11 | | If, during any taxable year ending on or after December 31, | 12 | | 1986, the
tax imposed by subsections (c) and (d) of this | 13 | | Section for which a taxpayer
has claimed a credit under this | 14 | | subsection (i) is reduced, the amount of
credit for such tax | 15 | | shall also be reduced. Such reduction shall be
determined by | 16 | | recomputing the credit to take into account the reduced tax
| 17 | | imposed by subsections (c) and (d). If any portion of the
| 18 | | reduced amount of credit has been carried to a different | 19 | | taxable year, an
amended return shall be filed for such taxable | 20 | | year to reduce the amount of
credit claimed. | 21 | | (j) Training expense credit. Beginning with tax years | 22 | | ending on or
after December 31, 1986 and prior to December 31, | 23 | | 2003, a taxpayer shall be
allowed a credit against the
tax | 24 | | imposed by subsections (a) and (b) under this Section
for all | 25 | | amounts paid or accrued, on behalf of all persons
employed by | 26 | | the taxpayer in Illinois or Illinois residents employed
outside |
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| 1 | | of Illinois by a taxpayer, for educational or vocational | 2 | | training in
semi-technical or technical fields or semi-skilled | 3 | | or skilled fields, which
were deducted from gross income in the | 4 | | computation of taxable income. The
credit against the tax | 5 | | imposed by subsections (a) and (b) shall be 1.6% of
such | 6 | | training expenses. For partners, shareholders of subchapter S
| 7 | | corporations, and owners of limited liability companies, if the | 8 | | liability
company is treated as a partnership for purposes of | 9 | | federal and State income
taxation, there shall be allowed a | 10 | | credit under this subsection (j) to be
determined in accordance | 11 | | with the determination of income and distributive
share of | 12 | | income under Sections 702 and 704 and subchapter S of the | 13 | | Internal
Revenue Code. | 14 | | Any credit allowed under this subsection which is unused in | 15 | | the year
the credit is earned may be carried forward to each of | 16 | | the 5 taxable
years following the year for which the credit is | 17 | | first computed until it is
used. This credit shall be applied | 18 | | first to the earliest year for which
there is a liability. If | 19 | | there is a credit under this subsection from more
than one tax | 20 | | year that is available to offset a liability the earliest
| 21 | | credit arising under this subsection shall be applied first. No | 22 | | carryforward
credit may be claimed in any tax year ending on or | 23 | | after
December 31, 2003. | 24 | | (k) Research and development credit. | 25 | | For tax years ending after July 1, 1990 and prior to
| 26 | | December 31, 2003, and beginning again for tax years ending on |
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| 1 | | or after December 31, 2004, and ending prior to January 1, | 2 | | 2011, a taxpayer shall be
allowed a credit against the tax | 3 | | imposed by subsections (a) and (b) of this
Section for | 4 | | increasing research activities in this State. The credit
| 5 | | allowed against the tax imposed by subsections (a) and (b) | 6 | | shall be equal
to 6 1/2% of the qualifying expenditures for | 7 | | increasing research activities
in this State. For partners, | 8 | | shareholders of subchapter S corporations, and
owners of | 9 | | limited liability companies, if the liability company is | 10 | | treated as a
partnership for purposes of federal and State | 11 | | income taxation, there shall be
allowed a credit under this | 12 | | subsection to be determined in accordance with the
| 13 | | determination of income and distributive share of income under | 14 | | Sections 702 and
704 and subchapter S of the Internal Revenue | 15 | | Code. | 16 | | For purposes of this subsection, "qualifying expenditures" | 17 | | means the
qualifying expenditures as defined for the federal | 18 | | credit for increasing
research activities which would be | 19 | | allowable under Section 41 of the
Internal Revenue Code and | 20 | | which are conducted in this State, "qualifying
expenditures for | 21 | | increasing research activities in this State" means the
excess | 22 | | of qualifying expenditures for the taxable year in which | 23 | | incurred
over qualifying expenditures for the base period, | 24 | | "qualifying expenditures
for the base period" means the average | 25 | | of the qualifying expenditures for
each year in the base | 26 | | period, and "base period" means the 3 taxable years
immediately |
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| 1 | | preceding the taxable year for which the determination is
being | 2 | | made. | 3 | | Any credit in excess of the tax liability for the taxable | 4 | | year
may be carried forward. A taxpayer may elect to have the
| 5 | | unused credit shown on its final completed return carried over | 6 | | as a credit
against the tax liability for the following 5 | 7 | | taxable years or until it has
been fully used, whichever occurs | 8 | | first; provided that no credit earned in a tax year ending | 9 | | prior to December 31, 2003 may be carried forward to any year | 10 | | ending on or after December 31, 2003, and no credit may be | 11 | | carried forward to any taxable year ending on or after January | 12 | | 1, 2011. | 13 | | If an unused credit is carried forward to a given year from | 14 | | 2 or more
earlier years, that credit arising in the earliest | 15 | | year will be applied
first against the tax liability for the | 16 | | given year. If a tax liability for
the given year still | 17 | | remains, the credit from the next earliest year will
then be | 18 | | applied, and so on, until all credits have been used or no tax
| 19 | | liability for the given year remains. Any remaining unused | 20 | | credit or
credits then will be carried forward to the next | 21 | | following year in which a
tax liability is incurred, except | 22 | | that no credit can be carried forward to
a year which is more | 23 | | than 5 years after the year in which the expense for
which the | 24 | | credit is given was incurred. | 25 | | No inference shall be drawn from this amendatory Act of the | 26 | | 91st General
Assembly in construing this Section for taxable |
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| 1 | | years beginning before January
1, 1999. | 2 | | (l) Environmental Remediation Tax Credit. | 3 | | (i) For tax years ending after December 31, 1997 and on | 4 | | or before
December 31, 2001, a taxpayer shall be allowed a | 5 | | credit against the tax
imposed by subsections (a) and (b) | 6 | | of this Section for certain amounts paid
for unreimbursed | 7 | | eligible remediation costs, as specified in this | 8 | | subsection.
For purposes of this Section, "unreimbursed | 9 | | eligible remediation costs" means
costs approved by the | 10 | | Illinois Environmental Protection Agency ("Agency") under
| 11 | | Section 58.14 of the Environmental Protection Act that were | 12 | | paid in performing
environmental remediation at a site for | 13 | | which a No Further Remediation Letter
was issued by the | 14 | | Agency and recorded under Section 58.10 of the | 15 | | Environmental
Protection Act. The credit must be claimed | 16 | | for the taxable year in which
Agency approval of the | 17 | | eligible remediation costs is granted. The credit is
not | 18 | | available to any taxpayer if the taxpayer or any related | 19 | | party caused or
contributed to, in any material respect, a | 20 | | release of regulated substances on,
in, or under the site | 21 | | that was identified and addressed by the remedial
action | 22 | | pursuant to the Site Remediation Program of the | 23 | | Environmental Protection
Act. After the Pollution Control | 24 | | Board rules are adopted pursuant to the
Illinois | 25 | | Administrative Procedure Act for the administration and | 26 | | enforcement of
Section 58.9 of the Environmental |
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| 1 | | Protection Act, determinations as to credit
availability | 2 | | for purposes of this Section shall be made consistent with | 3 | | those
rules. For purposes of this Section, "taxpayer" | 4 | | includes a person whose tax
attributes the taxpayer has | 5 | | succeeded to under Section 381 of the Internal
Revenue Code | 6 | | and "related party" includes the persons disallowed a | 7 | | deduction
for losses by paragraphs (b), (c), and (f)(1) of | 8 | | Section 267 of the Internal
Revenue Code by virtue of being | 9 | | a related taxpayer, as well as any of its
partners. The | 10 | | credit allowed against the tax imposed by subsections (a) | 11 | | and
(b) shall be equal to 25% of the unreimbursed eligible | 12 | | remediation costs in
excess of $100,000 per site, except | 13 | | that the $100,000 threshold shall not apply
to any site | 14 | | contained in an enterprise zone as determined by the | 15 | | Department of
Commerce and Community Affairs (now | 16 | | Department of Commerce and Economic Opportunity). The | 17 | | total credit allowed shall not exceed
$40,000 per year with | 18 | | a maximum total of $150,000 per site. For partners and
| 19 | | shareholders of subchapter S corporations, there shall be | 20 | | allowed a credit
under this subsection to be determined in | 21 | | accordance with the determination of
income and | 22 | | distributive share of income under Sections 702 and 704 and
| 23 | | subchapter S of the Internal Revenue Code. | 24 | | (ii) A credit allowed under this subsection that is | 25 | | unused in the year
the credit is earned may be carried | 26 | | forward to each of the 5 taxable years
following the year |
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| 1 | | for which the credit is first earned until it is used.
The | 2 | | term "unused credit" does not include any amounts of | 3 | | unreimbursed eligible
remediation costs in excess of the | 4 | | maximum credit per site authorized under
paragraph (i). | 5 | | This credit shall be applied first to the earliest year
for | 6 | | which there is a liability. If there is a credit under this | 7 | | subsection
from more than one tax year that is available to | 8 | | offset a liability, the
earliest credit arising under this | 9 | | subsection shall be applied first. A
credit allowed under | 10 | | this subsection may be sold to a buyer as part of a sale
of | 11 | | all or part of the remediation site for which the credit | 12 | | was granted. The
purchaser of a remediation site and the | 13 | | tax credit shall succeed to the unused
credit and remaining | 14 | | carry-forward period of the seller. To perfect the
| 15 | | transfer, the assignor shall record the transfer in the | 16 | | chain of title for the
site and provide written notice to | 17 | | the Director of the Illinois Department of
Revenue of the | 18 | | assignor's intent to sell the remediation site and the | 19 | | amount of
the tax credit to be transferred as a portion of | 20 | | the sale. In no event may a
credit be transferred to any | 21 | | taxpayer if the taxpayer or a related party would
not be | 22 | | eligible under the provisions of subsection (i). | 23 | | (iii) For purposes of this Section, the term "site" | 24 | | shall have the same
meaning as under Section 58.2 of the | 25 | | Environmental Protection Act. | 26 | | (m) Education expense credit. Beginning with tax years |
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| 1 | | ending after
December 31, 1999, a taxpayer who
is the custodian | 2 | | of one or more qualifying pupils shall be allowed a credit
| 3 | | against the tax imposed by subsections (a) and (b) of this | 4 | | Section for
qualified education expenses incurred on behalf of | 5 | | the qualifying pupils.
The credit shall be equal to 25% of | 6 | | qualified education expenses, but in no
event may the total | 7 | | credit under this subsection claimed by a
family that is the
| 8 | | custodian of qualifying pupils exceed $500. In no event shall a | 9 | | credit under
this subsection reduce the taxpayer's liability | 10 | | under this Act to less than
zero. This subsection is exempt | 11 | | from the provisions of Section 250 of this
Act. | 12 | | For purposes of this subsection: | 13 | | "Qualifying pupils" means individuals who (i) are | 14 | | residents of the State of
Illinois, (ii) are under the age of | 15 | | 21 at the close of the school year for
which a credit is | 16 | | sought, and (iii) during the school year for which a credit
is | 17 | | sought were full-time pupils enrolled in a kindergarten through | 18 | | twelfth
grade education program at any school, as defined in | 19 | | this subsection. | 20 | | "Qualified education expense" means the amount incurred
on | 21 | | behalf of a qualifying pupil in excess of $250 for tuition, | 22 | | book fees, and
lab fees at the school in which the pupil is | 23 | | enrolled during the regular school
year. | 24 | | "School" means any public or nonpublic elementary or | 25 | | secondary school in
Illinois that is in compliance with Title | 26 | | VI of the Civil Rights Act of 1964
and attendance at which |
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| 1 | | satisfies the requirements of Section 26-1 of the
School Code, | 2 | | except that nothing shall be construed to require a child to
| 3 | | attend any particular public or nonpublic school to qualify for | 4 | | the credit
under this Section. | 5 | | "Custodian" means, with respect to qualifying pupils, an | 6 | | Illinois resident
who is a parent, the parents, a legal | 7 | | guardian, or the legal guardians of the
qualifying pupils. | 8 | | (n) River Edge Redevelopment Zone site remediation tax | 9 | | credit.
| 10 | | (i) For tax years ending on or after December 31, 2006, | 11 | | a taxpayer shall be allowed a credit against the tax | 12 | | imposed by subsections (a) and (b) of this Section for | 13 | | certain amounts paid for unreimbursed eligible remediation | 14 | | costs, as specified in this subsection. For purposes of | 15 | | this Section, "unreimbursed eligible remediation costs" | 16 | | means costs approved by the Illinois Environmental | 17 | | Protection Agency ("Agency") under Section 58.14a of the | 18 | | Environmental Protection Act that were paid in performing | 19 | | environmental remediation at a site within a River Edge | 20 | | Redevelopment Zone for which a No Further Remediation | 21 | | Letter was issued by the Agency and recorded under Section | 22 | | 58.10 of the Environmental Protection Act. The credit must | 23 | | be claimed for the taxable year in which Agency approval of | 24 | | the eligible remediation costs is granted. The credit is | 25 | | not available to any taxpayer if the taxpayer or any | 26 | | related party caused or contributed to, in any material |
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| 1 | | respect, a release of regulated substances on, in, or under | 2 | | the site that was identified and addressed by the remedial | 3 | | action pursuant to the Site Remediation Program of the | 4 | | Environmental Protection Act. Determinations as to credit | 5 | | availability for purposes of this Section shall be made | 6 | | consistent with rules adopted by the Pollution Control | 7 | | Board pursuant to the Illinois Administrative Procedure | 8 | | Act for the administration and enforcement of Section 58.9 | 9 | | of the Environmental Protection Act. For purposes of this | 10 | | Section, "taxpayer" includes a person whose tax attributes | 11 | | the taxpayer has succeeded to under Section 381 of the | 12 | | Internal Revenue Code and "related party" includes the | 13 | | persons disallowed a deduction for losses by paragraphs | 14 | | (b), (c), and (f)(1) of Section 267 of the Internal Revenue | 15 | | Code by virtue of being a related taxpayer, as well as any | 16 | | of its partners. The credit allowed against the tax imposed | 17 | | by subsections (a) and (b) shall be equal to 25% of the | 18 | | unreimbursed eligible remediation costs in excess of | 19 | | $100,000 per site. | 20 | | (ii) A credit allowed under this subsection that is | 21 | | unused in the year the credit is earned may be carried | 22 | | forward to each of the 5 taxable years following the year | 23 | | for which the credit is first earned until it is used. This | 24 | | credit shall be applied first to the earliest year for | 25 | | which there is a liability. If there is a credit under this | 26 | | subsection from more than one tax year that is available to |
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| 1 | | offset a liability, the earliest credit arising under this | 2 | | subsection shall be applied first. A credit allowed under | 3 | | this subsection may be sold to a buyer as part of a sale of | 4 | | all or part of the remediation site for which the credit | 5 | | was granted. The purchaser of a remediation site and the | 6 | | tax credit shall succeed to the unused credit and remaining | 7 | | carry-forward period of the seller. To perfect the | 8 | | transfer, the assignor shall record the transfer in the | 9 | | chain of title for the site and provide written notice to | 10 | | the Director of the Illinois Department of Revenue of the | 11 | | assignor's intent to sell the remediation site and the | 12 | | amount of the tax credit to be transferred as a portion of | 13 | | the sale. In no event may a credit be transferred to any | 14 | | taxpayer if the taxpayer or a related party would not be | 15 | | eligible under the provisions of subsection (i). | 16 | | (iii) For purposes of this Section, the term "site" | 17 | | shall have the same meaning as under Section 58.2 of the | 18 | | Environmental Protection Act. | 19 | | (iv) This subsection is exempt from the provisions of | 20 | | Section 250.
| 21 | | (Source: P.A. 95-454, eff. 8-27-07; 96-115, eff. 7-31-09; | 22 | | 96-116, eff. 7-31-09; 96-937, eff. 6-23-10; 96-1000, eff. | 23 | | 7-2-10.) | 24 | | (35 ILCS 5/201.5 new) | 25 | | Sec. 201.5. State spending limitation and tax reduction. |
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| 1 | | (a) If, beginning in State fiscal year 2012 and continuing | 2 | | through State fiscal year 2015, State spending for any fiscal | 3 | | year exceeds the State spending limitation set forth in | 4 | | subsection (b) of this Section, then the tax rates set forth in | 5 | | subsection (b) of Section 201 of this Act shall be reduced, | 6 | | according to the procedures set forth in this Section, to 3% of | 7 | | the taxpayer's net income for individuals, trusts, and estates | 8 | | and to 4.8% of the taxpayer's net income for corporations. For | 9 | | all taxable years following the taxable year in which the rate | 10 | | has been reduced pursuant to this Section, the tax rate set | 11 | | forth in subsection (b) of Section 201 of this Act shall be 3% | 12 | | of the taxpayer's net income for individuals, trusts, and | 13 | | estates and 4.8% of the taxpayer's net income for corporations. | 14 | | (b) The State spending limitation for fiscal years 2012 | 15 | | through 2015 shall be as follows: (i) for fiscal year 2012, | 16 | | $36,818,000,000; (ii) for fiscal year 2013, $37,554,000,000; | 17 | | (iii) for fiscal year 2014, $38,305,000,000; and (iv) for | 18 | | fiscal year 2015, $39,072,000,000. | 19 | | (c) Nothwithstanding any other provision of law to the | 20 | | contrary, the Auditor General shall examine each Public Act | 21 | | authorizing State spending from State general funds and prepare | 22 | | a report no later than 30 days after receiving notification of | 23 | | the Public Act from the Secretary of State or 60 days after the | 24 | | effective date of the Public Act, whichever is earlier. The | 25 | | Auditor General shall file the report with the Secretary of | 26 | | State and copies with the Governor, the State Treasurer, the |
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| 1 | | State Comptroller, the Senate, and the House of | 2 | | Representatives. The report shall indicate: (i) the amount of | 3 | | State spending set forth in the applicable Public Act; (ii) the | 4 | | total amount of State spending authorized by law for the | 5 | | applicable fiscal year as of the date of the report; and (iii) | 6 | | whether State spending exceeds the State spending limitation | 7 | | set forth in subsection (b). The Auditor General may examine | 8 | | multiple Public Acts in one consolidated report, provided that | 9 | | each Public Act is examined within the time period mandated by | 10 | | this subsection (c). The Auditor General shall issue reports in | 11 | | accordance with this Section through June 30, 2015 or the | 12 | | effective date of a reduction in the rate of tax imposed by | 13 | | subsections (a) and (b) of Section 201 of this Act pursuant to | 14 | | this Section, whichever is earlier. | 15 | | At the request of the Auditor General, each State agency | 16 | | shall, without delay, make available to the Auditor General or | 17 | | his or her designated representative any record or information | 18 | | requested and shall provide for examination or copying all | 19 | | records, accounts, papers, reports, vouchers, correspondence, | 20 | | books and other documentation in the custody of that agency, | 21 | | including information stored in electronic data processing | 22 | | systems, which is related to or within the scope of a report | 23 | | prepared under this Section. The Auditor General shall report | 24 | | to the Governor each instance in which a State agency fails to | 25 | | cooperate promptly and fully with his or her office as required | 26 | | by this Section. |
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| 1 | | The Auditor General's report shall not be in the nature of | 2 | | a post-audit or examination and shall not lead to the issuance | 3 | | of an opinion as that term is defined in generally accepted | 4 | | government auditing standards. | 5 | | (d) If the Auditor General reports that State spending has | 6 | | exceeded the State spending limitation set forth in subsection | 7 | | (b) and if the Governor has not been presented with a bill or | 8 | | bills passed by the General Assembly to reduce State spending | 9 | | to a level that does not exceed the State spending limitation | 10 | | within 45 calendar days of receipt of the Auditor General's | 11 | | report, then the Governor may, for the purpose of reducing | 12 | | State spending to a level that does not exceed the State | 13 | | spending limitation set forth in subsection (b), designate | 14 | | amounts to be set aside as a reserve from the amounts | 15 | | appropriated from the State general funds for all boards, | 16 | | commissions, agencies, institutions, authorities, colleges, | 17 | | universities, and bodies politic and corporate of the State, | 18 | | but not other constitutional officers, the legislative or | 19 | | judicial branch, the office of the Executive Inspector General, | 20 | | or the Executive Ethics Commission. Such a designation must be | 21 | | made within 15 calendar days after the end of that 45-day | 22 | | period. If the Governor designates amounts to be set aside as a | 23 | | reserve, the Governor shall give notice of the designation to | 24 | | the Auditor General, the State Treasurer, the State | 25 | | Comptroller, the Senate, and the House of Representatives. The | 26 | | amounts placed in reserves shall not be transferred, obligated, |
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| 1 | | encumbered, expended, or otherwise committed unless so | 2 | | authorized by law. Any amount placed in reserves is not State | 3 | | spending and shall not be considered when calculating the total | 4 | | amount of State spending. Any Public Act authorizing the use of | 5 | | amounts placed in reserve by the Governor is considered State | 6 | | spending, unless such Public Act authorizes the use of amounts | 7 | | placed in reserves in response to a fiscal emergency under | 8 | | subsection (g). | 9 | | (e) If the Auditor General reports under subsection (c) | 10 | | that State spending has exceeded the State spending limitation | 11 | | set forth in subsection (b), then the Auditor General shall | 12 | | issue a supplemental report no sooner than the 61st day and no | 13 | | later than the 65th day after issuing the report pursuant to | 14 | | subsection (c). The supplemental report shall: (i) summarize | 15 | | details of actions taken by the General Assembly and the | 16 | | Governor after the issuance of the initial report to reduce | 17 | | State spending, if any, (ii) indicate whether the level of | 18 | | State spending has changed since the initial report, and (iii) | 19 | | indicate whether State spending exceeds the State spending | 20 | | limitation. The Auditor General shall file the report with the | 21 | | Secretary of State and copies with the Governor, the State | 22 | | Treasurer, the State Comptroller, the Senate, and the House of | 23 | | Representatives. If the supplemental report of the Auditor | 24 | | General provides that State spending exceeds the State spending | 25 | | limitation, then the rate of tax imposed by subsections (a) and | 26 | | (b) of Section 201 is reduced as provided in this Section |
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| 1 | | beginning on the first day of the first month to occur not less | 2 | | than 30 days after issuance of the supplemental report. | 3 | | (f) For any taxable year in which the rates of tax have | 4 | | been reduced under this Section, the tax imposed by subsections | 5 | | (a) and (b) of Section 201 shall be determined as follows: | 6 | | (1) In the case of an individual, trust, or estate, the | 7 | | tax shall be imposed in an amount equal to the sum of (i) | 8 | | the rate applicable to the taxpayer under subsection (b) of | 9 | | Section 201 (without regard to the provisions of this | 10 | | Section) times the taxpayer's net income for any portion of | 11 | | the taxable year prior to the effective date of the | 12 | | reduction and (ii) 3% of the taxpayer's net income for any | 13 | | portion of the taxable year on or after the effective date | 14 | | of the reduction. | 15 | | (2) In the case of a corporation, the tax shall be | 16 | | imposed in an amount equal to the sum of (i) the rate | 17 | | applicable to the taxpayer under subsection (b) of Section | 18 | | 201 (without regard to the provisions of this Section) | 19 | | times the taxpayer's net income for any portion of the | 20 | | taxable year prior to the effective date of the reduction | 21 | | and (ii) 4.8% of the taxpayer's net income for any portion | 22 | | of the taxable year on or after the effective date of the | 23 | | reduction. | 24 | | (3) For any taxpayer for whom the rate has been reduced | 25 | | under this Section for a portion of a taxable year, the | 26 | | taxpayer shall determine the net income for each portion of |
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| 1 | | the taxable year following the rules set forth in Section | 2 | | 202.5 of this Act, using the effective date of the rate | 3 | | reduction rather than the January 1 dates found in that | 4 | | Section, and the day before the effective date of the rate | 5 | | reduction rather than the December 31 dates found in that | 6 | | Section. | 7 | | (4) If the rate applicable to the taxpayer under | 8 | | subsection (b) of Section 201 (without regard to the | 9 | | provisions of this Section) changes during a portion of the | 10 | | taxable year to which that rate is applied under paragraphs | 11 | | (1) or (2) of this subsection (f), the tax for that portion | 12 | | of the taxable year for purposes of paragraph (1) or (2) of | 13 | | this subsection (f) shall be determined as if that portion | 14 | | of the taxable year were a separate taxable year, following | 15 | | the rules set forth in Section 202.5 of this Act. If the | 16 | | taxpayer elects to follow the rules set forth in subsection | 17 | | (b) of Section 202.5, the taxpayer shall follow the rules | 18 | | set forth in subsection (b) of Section 202.5 for all | 19 | | purposes of this Section for that taxable year. | 20 | | (g) Notwithstanding the State spending limitation set | 21 | | forth in subsection (b) of this Section, the Governor may | 22 | | declare a fiscal emergency by filing a declaration with the | 23 | | Secretary of State and copies with the State Treasurer, the | 24 | | State Comptroller, the Senate, and the House of | 25 | | Representatives. The declaration must be limited to only one | 26 | | State fiscal year, set forth compelling reasons for declaring a |
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| 1 | | fiscal emergency, and request a specific dollar amount. Unless, | 2 | | within 10 calendar days of receipt of the Governor's | 3 | | declaration, the State Comptroller or State Treasurer notifies | 4 | | the Senate and the House of Representatives that he or she does | 5 | | not concur in the Governor's declaration, State spending | 6 | | authorized by law to address the fiscal emergency in an amount | 7 | | no greater than the dollar amount specified in the declaration | 8 | | shall not be considered "State spending" for purposes of the | 9 | | State spending limitation. | 10 | | (h) As used in this Section: | 11 | | "State general funds" means the General Revenue Fund, the | 12 | | Common School Fund, the General Revenue Common School Special | 13 | | Account Fund, the Education Assistance Fund, and the Budget | 14 | | Stabilization Fund. | 15 | | "State spending" means (i) the total amount authorized for | 16 | | spending by appropriation or statutory transfer from the State | 17 | | general funds in the applicable fiscal year, and (ii) any | 18 | | amounts the Governor places in reserves in accordance with | 19 | | subsection (d) that are subsequently released from reserves | 20 | | following authorization by a Public Act. For the purpose of | 21 | | this definition, "appropriation" means authority to spend | 22 | | money from a State general fund for a specific amount, purpose, | 23 | | and time period, including any supplemental appropriation or | 24 | | continuing appropriation, but does not include | 25 | | reappropriations from a previous fiscal year. For the purpose | 26 | | of this definition, "statutory transfer" means authority to |
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| 1 | | transfer funds from one State general fund to any other fund in | 2 | | the State Treasury, but does not include transfers made from | 3 | | one State general fund to another State general fund. | 4 | | "State spending limitation" means the amount described in | 5 | | subsection (b) of this Section for the applicable fiscal year. | 6 | | (35 ILCS 5/202.5 new) | 7 | | Sec. 202.5. Net income attributable to the period beginning | 8 | | prior to January 1 of any year and ending after December 31 of | 9 | | the preceding year. | 10 | | (a) In general. With respect to the taxable year of a | 11 | | taxpayer beginning prior to January 1 of any year and ending | 12 | | after December 31 of the preceding year, net income for the | 13 | | period after December 31 of the preceding year, is that amount | 14 | | that bears the same ratio to the taxpayer's net income for the | 15 | | entire taxable year as the number of days in that taxable year | 16 | | after December 31 bears to the total number of days in that | 17 | | taxable year, and the net income for the period prior to | 18 | | January 1 is that amount that bears the same ratio to the | 19 | | taxpayer's net income for the entire taxable year as the number | 20 | | of days in that taxable year prior to January 1 bears to the | 21 | | total number of days in that taxable year. | 22 | | (b) Election to attribute income and deduction items | 23 | | specifically to the respective portions of a taxable year prior | 24 | | to January 1 of any year and after December 31 of the preceding | 25 | | year. In the case of a taxpayer with a taxable year beginning |
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| 1 | | prior to January 1 of any year and ending after December 31 of | 2 | | the preceding year, the taxpayer may elect, instead of the | 3 | | procedure established in subsection (a) of this Section, to | 4 | | determine net income on a specific accounting basis for the 2 | 5 | | portions of the taxable year: | 6 | | (1) from the beginning of the taxable year through | 7 | | December 31; and | 8 | | (2) from January 1 through the end of the taxable year. | 9 | | The election provided by this subsection must be made in | 10 | | form and manner that the Department requires by rule, and must | 11 | | be made no later than the due date (including any extensions | 12 | | thereof) for the filing of the return for the taxable year, and | 13 | | is irrevocable. | 14 | | (c) If the taxpayer elects specific accounting under | 15 | | subsection (b): | 16 | | (1) there shall be taken into account in computing base | 17 | | income for each of the 2 portions of the taxable year only | 18 | | those items earned, received, paid, incurred or accrued in | 19 | | each such period; | 20 | | (2) for purposes of apportioning business income of the | 21 | | taxpayer, the provisions in Article 3 shall be applied on | 22 | | the basis of the taxpayer's full taxable year, without | 23 | | regard to this Section; | 24 | | (3) the net loss carryforward deduction for the taxable | 25 | | year under Section 207 may not exceed combined net income | 26 | | of both portions of the taxable year, and shall be used |
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| 1 | | against the net income of the portion of the taxable year | 2 | | from the beginning of the taxable year through December 31 | 3 | | before any remaining amount is used against the net income | 4 | | of the latter portion of the taxable year.
| 5 | | (35 ILCS 5/207) (from Ch. 120, par. 2-207)
| 6 | | Sec. 207. Net Losses.
| 7 | | (a) If after applying all of the (i) modifications
provided | 8 | | for in paragraph (2) of Section 203(b), paragraph (2) of | 9 | | Section
203(c) and paragraph (2) of Section 203(d) and (ii) the | 10 | | allocation and
apportionment provisions of Article 3 of this
| 11 | | Act and subsection (c) of this Section, the taxpayer's net | 12 | | income results in a loss;
| 13 | | (1) for any taxable year ending prior to December 31, | 14 | | 1999, such loss
shall be allowed
as a carryover or | 15 | | carryback deduction in the manner allowed under Section
172 | 16 | | of the Internal Revenue Code;
| 17 | | (2) for any taxable year ending on or after December | 18 | | 31, 1999 and prior
to December 31, 2003, such loss
shall be | 19 | | allowed as a carryback to each of the 2 taxable years | 20 | | preceding the
taxable year of such loss and shall be a net | 21 | | operating loss carryover to each of the
20 taxable years | 22 | | following the taxable year of such loss; and
| 23 | | (3) for any taxable year ending on or after December | 24 | | 31, 2003, such loss
shall be allowed as a net operating | 25 | | loss carryover to each of the 12 taxable years
following |
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| 1 | | the taxable year of such loss , except as provided in | 2 | | subsection (d) .
| 3 | | (a-5) Election to relinquish carryback and order of | 4 | | application of
losses.
| 5 | | (A) For losses incurred in tax years ending prior | 6 | | to December 31,
2003, the taxpayer may elect to | 7 | | relinquish the entire carryback period
with respect to | 8 | | such loss. Such election shall be made in the form and | 9 | | manner
prescribed by the Department and shall be made | 10 | | by the due date (including
extensions of time) for | 11 | | filing the taxpayer's return for the taxable year in
| 12 | | which such loss is incurred, and such election, once | 13 | | made, shall be
irrevocable.
| 14 | | (B) The entire amount of such loss shall be carried | 15 | | to the earliest
taxable year to which such loss may be | 16 | | carried. The amount of such loss which
shall be carried | 17 | | to each of the other taxable years shall be the excess, | 18 | | if
any, of the amount of such loss over the sum of the | 19 | | deductions for carryback or
carryover of such loss | 20 | | allowable for each of the prior taxable years to which
| 21 | | such loss may be carried.
| 22 | | (b) Any loss determined under subsection (a) of this | 23 | | Section must be carried
back or carried forward in the same | 24 | | manner for purposes of subsections (a)
and (b) of Section 201 | 25 | | of this Act as for purposes of subsections (c) and
(d) of | 26 | | Section 201 of this Act.
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| 1 | | (c) Notwithstanding any other provision of this Act, for | 2 | | each taxable year ending on or after December 31, 2008, for | 3 | | purposes of computing the loss for the taxable year under | 4 | | subsection (a) of this Section and the deduction taken into | 5 | | account for the taxable year for a net operating loss carryover | 6 | | under paragraphs (1), (2), and (3) of subsection (a) of this | 7 | | Section, the loss and net operating loss carryover shall be | 8 | | reduced in an amount equal to the reduction to the net | 9 | | operating loss and net operating loss carryover to the taxable | 10 | | year, respectively, required under Section 108(b)(2)(A) of the | 11 | | Internal Revenue Code, multiplied by a fraction, the numerator | 12 | | of which is the amount of discharge of indebtedness income that | 13 | | is excluded from gross income for the taxable year (but only if | 14 | | the taxable year ends on or after December 31, 2008) under | 15 | | Section 108(a) of the Internal Revenue Code and that would have | 16 | | been allocated and apportioned to this State under Article 3 of | 17 | | this Act but for that exclusion, and the denominator of which | 18 | | is the total amount of discharge of indebtedness income | 19 | | excluded from gross income under Section 108(a) of the Internal | 20 | | Revenue Code for the taxable year. The reduction required under | 21 | | this subsection (c) shall be made after the determination of | 22 | | Illinois net income for the taxable year in which the | 23 | | indebtedness is discharged.
| 24 | | (d) In the case of a corporation (other than a Subchapter S | 25 | | corporation), no carryover deduction shall be allowed under | 26 | | this Section for any taxable year ending after December 31, |
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| 1 | | 2010 and prior to December 31, 2014; provided that, for | 2 | | purposes of determining the taxable years to which a net loss | 3 | | may be carried under subsection (a) of this Section, no taxable | 4 | | year for which a deduction is disallowed under this subsection | 5 | | shall be counted. | 6 | | (Source: P.A. 95-233, eff. 8-16-07.)
| 7 | | (35 ILCS 5/208) (from Ch. 120, par. 2-208)
| 8 | | Sec. 208. Tax credit for residential real property taxes. | 9 | | For Beginning with tax years ending on or after December 31, | 10 | | 1991 and ending on or before December 31, 2010 ,
every | 11 | | individual taxpayer shall be entitled to a tax credit equal
to | 12 | | 5% of real property taxes paid by such taxpayer during the
| 13 | | taxable year on the principal residence of the taxpayer. In the
| 14 | | case of multi-unit or multi-use structures and farm dwellings,
| 15 | | the taxes on the taxpayer's principal residence shall be that
| 16 | | portion of the total taxes which is attributable to such | 17 | | principal
residence.
| 18 | | (Source: P.A. 87-17.)
| 19 | | (35 ILCS 5/517 new) | 20 | | Sec. 517. Property tax rebate information. For taxable | 21 | | years beginning on or after January 1, 2011, for the purposes | 22 | | of making distributions from the Property Tax Rebate Trust | 23 | | Fund, the Department shall print on its standard individual | 24 | | income tax form a provision allowing the taxpayer to indicate |
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| 1 | | whether (i) he or she was responsible for paying real property | 2 | | taxes on his or her principal residence located in the State | 3 | | during the taxable year and (ii) he or she is the only person | 4 | | claiming a rebate for that residence. The Department shall | 5 | | develop a schedule to be attached to the individual income tax | 6 | | form for the purpose of verifying the taxpayer's property tax | 7 | | liability. If the rate of tax imposed by subsections (a) and | 8 | | (b) of Section 201 is reduced pursuant to Section 201.5 of this | 9 | | Act, the Department shall not require the schedule on or after | 10 | | the effective date of the reduction.
| 11 | | (35 ILCS 5/804) (from Ch. 120, par. 8-804)
| 12 | | Sec. 804. Failure to Pay Estimated Tax.
| 13 | | (a) In general. In case of any underpayment of estimated | 14 | | tax by a
taxpayer, except as provided in subsection (d) or (e), | 15 | | the taxpayer shall
be liable to a penalty in an amount | 16 | | determined at the rate prescribed by
Section 3-3 of the Uniform | 17 | | Penalty and Interest Act upon the amount of the
underpayment | 18 | | (determined under subsection (b)) for each required | 19 | | installment.
| 20 | | (b) Amount of underpayment. For purposes of subsection (a), | 21 | | the
amount of the underpayment shall be the excess of:
| 22 | | (1) the amount of the installment which would be | 23 | | required to be paid
under subsection (c), over
| 24 | | (2) the amount, if any, of the installment paid on or | 25 | | before the
last date prescribed for payment.
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| 1 | | (c) Amount of Required Installments.
| 2 | | (1) Amount.
| 3 | | (A) In General. Except as provided in paragraph | 4 | | (2), the amount of any
required installment shall be | 5 | | 25% of the required annual payment.
| 6 | | (B) Required Annual Payment. For purposes of | 7 | | subparagraph (A),
the term "required annual payment" | 8 | | means the lesser of
| 9 | | (i) 90% of the tax shown on the return for the | 10 | | taxable year, or
if no return is filed, 90% of the | 11 | | tax for such year, or
| 12 | | (ii) for installments due prior to February 1, | 13 | | 2011, and after January 31, 2012, 100% of the tax | 14 | | shown on the return of the taxpayer for the
| 15 | | preceding taxable year if a return showing a | 16 | | liability for tax was filed by
the taxpayer for the | 17 | | preceding taxable year and such preceding year was | 18 | | a
taxable year of 12 months ; or .
| 19 | | (iii) for installments due after January 31, | 20 | | 2011, and prior to February 1, 2012, 150% of the | 21 | | tax shown on the return of the taxpayer for the | 22 | | preceding taxable year if a return showing a | 23 | | liability for tax was filed by the taxpayer for the | 24 | | preceding taxable year and such preceding year was | 25 | | a taxable year of 12 months.
| 26 | | (2) Lower Required Installment where Annualized Income |
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| 1 | | Installment is Less
Than Amount Determined Under Paragraph | 2 | | (1).
| 3 | | (A) In General. In the case of any required | 4 | | installment if a taxpayer
establishes that the | 5 | | annualized income installment is less than the amount
| 6 | | determined under paragraph (1),
| 7 | | (i) the amount of such required installment | 8 | | shall be the annualized
income installment, and
| 9 | | (ii) any reduction in a required installment | 10 | | resulting from the
application of this | 11 | | subparagraph shall be recaptured by increasing the
| 12 | | amount of the next required installment determined | 13 | | under paragraph (1) by
the amount of such | 14 | | reduction, and by increasing subsequent required
| 15 | | installments to the extent that the reduction has | 16 | | not previously been
recaptured under this clause.
| 17 | | (B) Determination of Annualized Income | 18 | | Installment. In the case of
any required installment, | 19 | | the annualized income installment is the
excess, if | 20 | | any, of
| 21 | | (i) an amount equal to the applicable | 22 | | percentage of the tax for the
taxable year computed | 23 | | by placing on an annualized basis the net income | 24 | | for
months in the taxable year ending before the | 25 | | due date for the installment, over
| 26 | | (ii) the aggregate amount of any prior |
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| 1 | | required installments for
the taxable year.
| 2 | | (C) Applicable Percentage.
|
|
3 | | In the case of the following |
The applicable |
|
4 | | required installments: |
percentage is: |
|
5 | | 1st ............................... |
22.5% |
|
6 | | 2nd ............................... |
45% |
|
7 | | 3rd ............................... |
67.5% |
|
8 | | 4th ............................... |
90% |
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9 | | (D) Annualized Net Income; Individuals. For | 10 | | individuals, net
income shall be placed on an | 11 | | annualized basis by:
| 12 | | (i) multiplying by 12, or in the case of a | 13 | | taxable year of
less than 12 months, by the number | 14 | | of months in the taxable year, the
net income | 15 | | computed without regard to the standard exemption | 16 | | for the months
in the taxable
year ending before | 17 | | the month in which the installment is required to | 18 | | be paid;
| 19 | | (ii) dividing the resulting amount by the | 20 | | number of months in the
taxable year ending before | 21 | | the month in which such installment date falls; and
| 22 | | (iii) deducting from such amount the standard | 23 | | exemption allowable for
the taxable year, such | 24 | | standard exemption being determined as of the last
| 25 | | date prescribed for payment of the installment.
| 26 | | (E) Annualized Net Income; Corporations. For |
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| 1 | | corporations,
net income shall be placed on an | 2 | | annualized basis by multiplying
by 12 the taxable | 3 | | income
| 4 | | (i) for the first 3 months of the taxable year, | 5 | | in the case of the
installment required to be paid | 6 | | in the 4th month,
| 7 | | (ii) for the first 3 months or for the first 5 | 8 | | months of the taxable
year, in the case of the | 9 | | installment required to be paid in the 6th month,
| 10 | | (iii) for the first 6 months or for the first 8 | 11 | | months of the taxable
year, in the case of the | 12 | | installment required to be paid in the 9th month, | 13 | | and
| 14 | | (iv) for the first 9 months or for the first 11 | 15 | | months of the taxable
year, in the case of the | 16 | | installment required to be paid in the 12th month
| 17 | | of the taxable year,
| 18 | | then dividing the resulting amount by the number of | 19 | | months in the taxable
year (3, 5, 6, 8, 9, or 11 as the | 20 | | case may be).
| 21 | | (d) Exceptions. Notwithstanding the provisions of the | 22 | | preceding
subsections, the penalty imposed by subsection (a) | 23 | | shall not
be imposed if the taxpayer was not required to file | 24 | | an Illinois income
tax return for the preceding taxable year, | 25 | | or, for individuals, if the
taxpayer had no tax liability for | 26 | | the preceding taxable year and such year
was a taxable year of |
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| 1 | | 12 months.
The penalty imposed by subsection (a) shall
also not | 2 | | be imposed on any underpayments of estimated tax due before the
| 3 | | effective date of this amendatory Act of 1998 which | 4 | | underpayments are solely
attributable to the change in | 5 | | apportionment from subsection (a) to subsection
(h) of Section | 6 | | 304. The provisions of this amendatory Act of 1998 apply to tax
| 7 | | years ending on or after December 31, 1998.
| 8 | | (e) The penalty imposed for underpayment of estimated tax | 9 | | by subsection
(a) of this Section shall not be imposed to the | 10 | | extent that the Director
or his or her designate determines, | 11 | | pursuant to Section 3-8 of the Uniform Penalty
and Interest Act | 12 | | that the penalty should not be imposed.
| 13 | | (f) Definition of tax. For purposes of subsections (b) and | 14 | | (c),
the term "tax" means the excess of the tax imposed under | 15 | | Article 2 of
this Act, over the amounts credited against such | 16 | | tax under Sections
601(b) (3) and (4).
| 17 | | (g) Application of Section in case of tax withheld under | 18 | | Article 7.
For purposes of applying this Section:
| 19 | | (1) in the case of an individual, tax
withheld from | 20 | | compensation for the taxable year shall be deemed a payment
| 21 | | of estimated tax, and an equal part of such amount shall be | 22 | | deemed paid
on each installment date for such taxable year, | 23 | | unless the taxpayer
establishes the dates on which all | 24 | | amounts were actually withheld, in
which case the amounts | 25 | | so withheld shall be deemed payments of estimated
tax on | 26 | | the dates on which such amounts were actually withheld;
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| 1 | | (2) amounts timely paid by a partnership, Subchapter S | 2 | | corporation, or trust on behalf of a partner, shareholder, | 3 | | or beneficiary pursuant to subsection (f) of Section 502 or | 4 | | Section 709.5 and claimed as a payment of estimated tax | 5 | | shall be deemed a payment of estimated tax made on the last | 6 | | day of the taxable year of the partnership, Subchapter S | 7 | | corporation, or trust for which the income from the | 8 | | withholding is made was computed; and | 9 | | (3) all other amounts pursuant to Article 7 shall be | 10 | | deemed a payment of estimated tax on the date the payment | 11 | | is made to the taxpayer of the amount from which the tax is | 12 | | withheld.
| 13 | | (g-5) Amounts withheld under the State Salary and Annuity | 14 | | Withholding
Act. An individual who has amounts withheld under | 15 | | paragraph (10) of Section 4
of the State Salary and Annuity | 16 | | Withholding Act may elect to have those amounts
treated as | 17 | | payments of estimated tax made on the dates on which those | 18 | | amounts
are actually withheld.
| 19 | | (i) Short taxable year. The application of this Section to
| 20 | | taxable years of less than 12 months shall be in accordance | 21 | | with
regulations prescribed by the Department.
| 22 | | The changes in this Section made by Public Act 84-127 shall | 23 | | apply to
taxable years ending on or after January 1, 1986.
| 24 | | (Source: P.A. 95-233, eff. 8-16-07.)
| 25 | | (35 ILCS 5/901) (from Ch. 120, par. 9-901) |
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| 1 | | Sec. 901. Collection Authority. | 2 | | (a) In general. | 3 | | The Department shall collect the taxes imposed by this Act. | 4 | | The Department
shall collect certified past due child support | 5 | | amounts under Section 2505-650
of the Department of Revenue Law | 6 | | (20 ILCS 2505/2505-650). Except as
provided in subsections (c) , | 7 | | and (e) , (f), (g), and (h) of this Section, money collected
| 8 | | pursuant to subsections (a) and (b) of Section 201 of this Act | 9 | | shall be
paid into the General Revenue Fund in the State | 10 | | treasury; money
collected pursuant to subsections (c) and (d) | 11 | | of Section 201 of this Act
shall be paid into the Personal | 12 | | Property Tax Replacement Fund, a special
fund in the State | 13 | | Treasury; and money collected under Section 2505-650 of the
| 14 | | Department of Revenue Law (20 ILCS 2505/2505-650) shall be paid
| 15 | | into the
Child Support Enforcement Trust Fund, a special fund | 16 | | outside the State
Treasury, or
to the State
Disbursement Unit | 17 | | established under Section 10-26 of the Illinois Public Aid
| 18 | | Code, as directed by the Department of Healthcare and Family | 19 | | Services. | 20 | | (b) Local Government Distributive Fund. | 21 | | Beginning August 1, 1969, and continuing through June 30, | 22 | | 1994, the Treasurer
shall transfer each month from the General | 23 | | Revenue Fund to a special fund in
the State treasury, to be | 24 | | known as the "Local Government Distributive Fund", an
amount | 25 | | equal to 1/12 of the net revenue realized from the tax imposed | 26 | | by
subsections (a) and (b) of Section 201 of this Act during |
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| 1 | | the preceding month.
Beginning July 1, 1994, and continuing | 2 | | through June 30, 1995, the Treasurer
shall transfer each month | 3 | | from the General Revenue Fund to the Local Government
| 4 | | Distributive Fund an amount equal to 1/11 of the net revenue | 5 | | realized from the
tax imposed by subsections (a) and (b) of | 6 | | Section 201 of this Act during the
preceding month. Beginning | 7 | | July 1, 1995 and continuing through January 31, 2011 , the | 8 | | Treasurer shall transfer each
month from the General Revenue | 9 | | Fund to the Local Government Distributive Fund
an amount equal | 10 | | to the net of (i) 1/10 of the net revenue realized from the
tax | 11 | | imposed by
subsections (a) and (b) of Section 201 of the | 12 | | Illinois Income Tax Act during
the preceding month
(ii) minus, | 13 | | beginning July 1, 2003 and ending June 30, 2004, $6,666,666, | 14 | | and
beginning July 1,
2004,
zero. Beginning February 1, 2011, | 15 | | and continuing through January 31, 2015, the Treasurer shall | 16 | | transfer each month from the General Revenue Fund to the Local | 17 | | Government Distributive Fund an amount equal to the sum of (i) | 18 | | 6% (10% of the ratio of the 3% individual income tax rate prior | 19 | | to 2011 to the 5% individual income tax rate after 2010) of the | 20 | | net revenue realized from the tax imposed by subsections (a) | 21 | | and (b) of Section 201 of this Act upon individuals, trusts, | 22 | | and estates during the preceding month and (ii) 6.86% (10% of | 23 | | the ratio of the 4.8% corporate income tax rate prior to 2011 | 24 | | to the 7% corporate income tax rate after 2010) of the net | 25 | | revenue realized from the tax imposed by subsections (a) and | 26 | | (b) of Section 201 of this Act upon corporations during the |
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| 1 | | preceding month. Beginning February 1, 2015 and continuing | 2 | | through January 31, 2025, the Treasurer shall transfer each | 3 | | month from the General Revenue Fund to the Local Government | 4 | | Distributive Fund an amount equal to the sum of (i) 7.5% (10% | 5 | | of the ratio of the 3% individual income tax rate prior to 2011 | 6 | | to the 4% individual income tax rate after 2014) of the net | 7 | | revenue realized from the tax imposed by subsections (a) and | 8 | | (b) of Section 201 of this Act upon individuals, trusts, and | 9 | | estates during the preceding month and (ii) 8.57% (10% of the | 10 | | ratio of the 4.8% corporate income tax rate prior to 2011 to | 11 | | the 5.6% corporate income tax rate after 2014) of the net | 12 | | revenue realized from the tax imposed by subsections (a) and | 13 | | (b) of Section 201 of this Act upon corporations during the | 14 | | preceding month. Beginning February 1, 2025, the Treasurer | 15 | | shall transfer each month from the General Revenue Fund to the | 16 | | Local Government Distributive Fund an amount equal to the sum | 17 | | of (i) 8.57% (10% of the ratio of the 3% individual income tax | 18 | | rate prior to 2011 to the 3.5% individual income tax rate after | 19 | | 2024) of the net revenue realized from the tax imposed by | 20 | | subsections (a) and (b) of Section 201 of this Act upon | 21 | | individuals, trusts, and estates during the preceding month and | 22 | | (ii) 9.8% (10% of the ratio of the 4.8% corporate income tax | 23 | | rate prior to 2011 to the 4.9% corporate income tax rate after | 24 | | 2024) of the net revenue realized from the tax imposed by | 25 | | subsections (a) and (b) of Section 201 of this Act upon | 26 | | corporations during the preceding month. Net revenue realized |
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| 1 | | for a month shall be defined as the
revenue from the tax | 2 | | imposed by subsections (a) and (b) of Section 201 of this
Act | 3 | | which is deposited in the General Revenue Fund, the Education | 4 | | Educational Assistance
Fund , and the Income Tax Surcharge Local | 5 | | Government Distributive Fund , the Property Tax Rebate Trust | 6 | | Fund, the Fund for the Advancement of Education, and the | 7 | | Commitment to Human Services Fund during the
month minus the | 8 | | amount paid out of the General Revenue Fund in State warrants
| 9 | | during that same month as refunds to taxpayers for overpayment | 10 | | of liability
under the tax imposed by subsections (a) and (b) | 11 | | of Section 201 of this Act. | 12 | | (c) Deposits Into Income Tax Refund Fund. | 13 | | (1) Beginning on January 1, 1989 and thereafter, the | 14 | | Department shall
deposit a percentage of the amounts | 15 | | collected pursuant to subsections (a)
and (b)(1), (2), and | 16 | | (3), of Section 201 of this Act into a fund in the State
| 17 | | treasury known as the Income Tax Refund Fund. The | 18 | | Department shall deposit 6%
of such amounts during the | 19 | | period beginning January 1, 1989 and ending on June
30, | 20 | | 1989. Beginning with State fiscal year 1990 and for each | 21 | | fiscal year
thereafter, the percentage deposited into the | 22 | | Income Tax Refund Fund during a
fiscal year shall be the | 23 | | Annual Percentage. For fiscal years 1999 through
2001, the | 24 | | Annual Percentage shall be 7.1%.
For fiscal year 2003, the | 25 | | Annual Percentage shall be 8%.
For fiscal year 2004, the | 26 | | Annual Percentage shall be 11.7%. Upon the effective date |
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| 1 | | of this amendatory Act of the 93rd General Assembly, the | 2 | | Annual Percentage shall be 10% for fiscal year 2005. For | 3 | | fiscal year 2006, the Annual Percentage shall be 9.75%. For | 4 | | fiscal
year 2007, the Annual Percentage shall be 9.75%. For | 5 | | fiscal year 2008, the Annual Percentage shall be 7.75%. For | 6 | | fiscal year 2009, the Annual Percentage shall be 9.75%. For | 7 | | fiscal year 2010, the Annual Percentage shall be 9.75%. For | 8 | | fiscal year 2011, the Annual Percentage shall be 8.75%. For | 9 | | all other
fiscal years, the
Annual Percentage shall be | 10 | | calculated as a fraction, the numerator of which
shall be | 11 | | the amount of refunds approved for payment by the | 12 | | Department during
the preceding fiscal year as a result of | 13 | | overpayment of tax liability under
subsections (a) and | 14 | | (b)(1), (2), and (3) of Section 201 of this Act plus the
| 15 | | amount of such refunds remaining approved but unpaid at the | 16 | | end of the
preceding fiscal year, minus the amounts | 17 | | transferred into the Income Tax
Refund Fund from the | 18 | | Tobacco Settlement Recovery Fund, and
the denominator of | 19 | | which shall be the amounts which will be collected pursuant
| 20 | | to subsections (a) and (b)(1), (2), and (3) of Section 201 | 21 | | of this Act during
the preceding fiscal year; except that | 22 | | in State fiscal year 2002, the Annual
Percentage shall in | 23 | | no event exceed 7.6%. The Director of Revenue shall
certify | 24 | | the Annual Percentage to the Comptroller on the last | 25 | | business day of
the fiscal year immediately preceding the | 26 | | fiscal year for which it is to be
effective. |
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| 1 | | (2) Beginning on January 1, 1989 and thereafter, the | 2 | | Department shall
deposit a percentage of the amounts | 3 | | collected pursuant to subsections (a)
and (b)(6), (7), and | 4 | | (8), (c) and (d) of Section 201
of this Act into a fund in | 5 | | the State treasury known as the Income Tax
Refund Fund. The | 6 | | Department shall deposit 18% of such amounts during the
| 7 | | period beginning January 1, 1989 and ending on June 30, | 8 | | 1989. Beginning
with State fiscal year 1990 and for each | 9 | | fiscal year thereafter, the
percentage deposited into the | 10 | | Income Tax Refund Fund during a fiscal year
shall be the | 11 | | Annual Percentage. For fiscal years 1999, 2000, and 2001, | 12 | | the
Annual Percentage shall be 19%.
For fiscal year 2003, | 13 | | the Annual Percentage shall be 27%. For fiscal year
2004, | 14 | | the Annual Percentage shall be 32%.
Upon the effective date | 15 | | of this amendatory Act of the 93rd General Assembly, the | 16 | | Annual Percentage shall be 24% for fiscal year 2005.
For | 17 | | fiscal year 2006, the Annual Percentage shall be 20%. For | 18 | | fiscal
year 2007, the Annual Percentage shall be 17.5%. For | 19 | | fiscal year 2008, the Annual Percentage shall be 15.5%. For | 20 | | fiscal year 2009, the Annual Percentage shall be 17.5%. For | 21 | | fiscal year 2010, the Annual Percentage shall be 17.5%. For | 22 | | fiscal year 2011, the Annual Percentage shall be 17.5%. For | 23 | | all other fiscal years, the Annual
Percentage shall be | 24 | | calculated
as a fraction, the numerator of which shall be | 25 | | the amount of refunds
approved for payment by the | 26 | | Department during the preceding fiscal year as
a result of |
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| 1 | | overpayment of tax liability under subsections (a) and | 2 | | (b)(6),
(7), and (8), (c) and (d) of Section 201 of this | 3 | | Act plus the
amount of such refunds remaining approved but | 4 | | unpaid at the end of the
preceding fiscal year, and the | 5 | | denominator of
which shall be the amounts which will be | 6 | | collected pursuant to subsections (a)
and (b)(6), (7), and | 7 | | (8), (c) and (d) of Section 201 of this Act during the
| 8 | | preceding fiscal year; except that in State fiscal year | 9 | | 2002, the Annual
Percentage shall in no event exceed 23%. | 10 | | The Director of Revenue shall
certify the Annual Percentage | 11 | | to the Comptroller on the last business day of
the fiscal | 12 | | year immediately preceding the fiscal year for which it is | 13 | | to be
effective. | 14 | | (3) The Comptroller shall order transferred and the | 15 | | Treasurer shall
transfer from the Tobacco Settlement | 16 | | Recovery Fund to the Income Tax Refund
Fund (i) $35,000,000 | 17 | | in January, 2001, (ii) $35,000,000 in January, 2002, and
| 18 | | (iii) $35,000,000 in January, 2003. | 19 | | (d) Expenditures from Income Tax Refund Fund. | 20 | | (1) Beginning January 1, 1989, money in the Income Tax | 21 | | Refund Fund
shall be expended exclusively for the purpose | 22 | | of paying refunds resulting
from overpayment of tax | 23 | | liability under Section 201 of this Act, for paying
rebates | 24 | | under Section 208.1 in the event that the amounts in the | 25 | | Homeowners'
Tax Relief Fund are insufficient for that | 26 | | purpose,
and for
making transfers pursuant to this |
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| 1 | | subsection (d). | 2 | | (2) The Director shall order payment of refunds | 3 | | resulting from
overpayment of tax liability under Section | 4 | | 201 of this Act from the
Income Tax Refund Fund only to the | 5 | | extent that amounts collected pursuant
to Section 201 of | 6 | | this Act and transfers pursuant to this subsection (d)
and | 7 | | item (3) of subsection (c) have been deposited and retained | 8 | | in the
Fund. | 9 | | (3) As soon as possible after the end of each fiscal | 10 | | year, the Director
shall
order transferred and the State | 11 | | Treasurer and State Comptroller shall
transfer from the | 12 | | Income Tax Refund Fund to the Personal Property Tax
| 13 | | Replacement Fund an amount, certified by the Director to | 14 | | the Comptroller,
equal to the excess of the amount | 15 | | collected pursuant to subsections (c) and
(d) of Section | 16 | | 201 of this Act deposited into the Income Tax Refund Fund
| 17 | | during the fiscal year over the amount of refunds resulting | 18 | | from
overpayment of tax liability under subsections (c) and | 19 | | (d) of Section 201
of this Act paid from the Income Tax | 20 | | Refund Fund during the fiscal year. | 21 | | (4) As soon as possible after the end of each fiscal | 22 | | year, the Director shall
order transferred and the State | 23 | | Treasurer and State Comptroller shall
transfer from the | 24 | | Personal Property Tax Replacement Fund to the Income Tax
| 25 | | Refund Fund an amount, certified by the Director to the | 26 | | Comptroller, equal
to the excess of the amount of refunds |
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| 1 | | resulting from overpayment of tax
liability under | 2 | | subsections (c) and (d) of Section 201 of this Act paid
| 3 | | from the Income Tax Refund Fund during the fiscal year over | 4 | | the amount
collected pursuant to subsections (c) and (d) of | 5 | | Section 201 of this Act
deposited into the Income Tax | 6 | | Refund Fund during the fiscal year. | 7 | | (4.5) As soon as possible after the end of fiscal year | 8 | | 1999 and of each
fiscal year
thereafter, the Director shall | 9 | | order transferred and the State Treasurer and
State | 10 | | Comptroller shall transfer from the Income Tax Refund Fund | 11 | | to the General
Revenue Fund any surplus remaining in the | 12 | | Income Tax Refund Fund as of the end
of such fiscal year; | 13 | | excluding for fiscal years 2000, 2001, and 2002
amounts | 14 | | attributable to transfers under item (3) of subsection (c) | 15 | | less refunds
resulting from the earned income tax credit. | 16 | | (5) This Act shall constitute an irrevocable and | 17 | | continuing
appropriation from the Income Tax Refund Fund | 18 | | for the purpose of paying
refunds upon the order of the | 19 | | Director in accordance with the provisions of
this Section. | 20 | | (e) Deposits into the Education Assistance Fund and the | 21 | | Income Tax
Surcharge Local Government Distributive Fund. | 22 | | On July 1, 1991, and thereafter, of the amounts collected | 23 | | pursuant to
subsections (a) and (b) of Section 201 of this Act, | 24 | | minus deposits into the
Income Tax Refund Fund, the Department | 25 | | shall deposit 7.3% into the
Education Assistance Fund in the | 26 | | State Treasury. Beginning July 1, 1991,
and continuing through |
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| 1 | | January 31, 1993, of the amounts collected pursuant to
| 2 | | subsections (a) and (b) of Section 201 of the Illinois Income | 3 | | Tax Act, minus
deposits into the Income Tax Refund Fund, the | 4 | | Department shall deposit 3.0%
into the Income Tax Surcharge | 5 | | Local Government Distributive Fund in the State
Treasury. | 6 | | Beginning February 1, 1993 and continuing through June 30, | 7 | | 1993, of
the amounts collected pursuant to subsections (a) and | 8 | | (b) of Section 201 of the
Illinois Income Tax Act, minus | 9 | | deposits into the Income Tax Refund Fund, the
Department shall | 10 | | deposit 4.4% into the Income Tax Surcharge Local Government
| 11 | | Distributive Fund in the State Treasury. Beginning July 1, | 12 | | 1993, and
continuing through June 30, 1994, of the amounts | 13 | | collected under subsections
(a) and (b) of Section 201 of this | 14 | | Act, minus deposits into the Income Tax
Refund Fund, the | 15 | | Department shall deposit 1.475% into the Income Tax Surcharge
| 16 | | Local Government Distributive Fund in the State Treasury. | 17 | | (f) Deposits into the Property Tax Rebate Trust Fund. | 18 | | Beginning July 1, 2011, the Department shall deposit the | 19 | | following portions of the revenue realized from the tax imposed | 20 | | upon individuals, trusts, and estates by subsections (a) and | 21 | | (b) of Section 201 of this Act during the preceding month, | 22 | | minus deposits into the Income Tax Refund Fund, into the | 23 | | Property Tax Rebate Trust Fund: | 24 | | (1) beginning July 1, 2011, and prior to July 1, 2015, | 25 | | 1/20; | 26 | | (2) beginning July 1, 2015, and prior to July 1, 2025, |
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| 1 | | 1/16; and | 2 | | (3) beginning July 1, 2025, 1/14. | 3 | | If the rate of tax imposed by subsection (a) and (b) of | 4 | | Section 201 is reduced pursuant to Section 201.5 of this Act, | 5 | | the Department shall not make the deposits required by this | 6 | | subsection (f) on or after the effective date of the reduction. | 7 | | (g) Deposits into the Fund for the Advancement of | 8 | | Education. Beginning February 1, 2015, the Department shall | 9 | | deposit the following portions of the revenue realized from the | 10 | | tax imposed upon individuals, trusts, and estates by | 11 | | subsections (a) and (b) of Section 201 of this Act during the | 12 | | preceding month, minus deposits into the Income Tax Refund | 13 | | Fund, into the Fund for the Advancement of Education: | 14 | | (1) beginning February 1, 2015, and prior to February | 15 | | 1, 2025, 1/32; and | 16 | | (2) beginning February 1, 2025, 1/28. | 17 | | If the rate of tax imposed by subsection (a) and (b) of | 18 | | Section 201 is reduced pursuant to Section 201.5 of this Act, | 19 | | the Department shall not make the deposits required by this | 20 | | subsection (g) on or after the effective date of the reduction. | 21 | | (h) Deposits into the Commitment to Human Services Fund. | 22 | | Beginning February 1, 2015, the Department shall deposit the | 23 | | following portions of the revenue realized from the tax imposed | 24 | | upon individuals, trusts, and estates by subsections (a) and | 25 | | (b) of Section 201 of this Act during the preceding month, | 26 | | minus deposits into the Income Tax Refund Fund, into the |
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| 1 | | Commitment to Human Services Fund: | 2 | | (1) beginning February 1, 2015, and prior to February | 3 | | 1, 2025, 1/32; and | 4 | | (2) beginning February 1, 2025, 1/28. | 5 | | If the rate of tax imposed by subsection (a) and (b) of | 6 | | Section 201 is reduced pursuant to Section 201.5 of this Act, | 7 | | the Department shall not make the deposits required by this | 8 | | subsection (h) on or after the effective date of the reduction. | 9 | | (Source: P.A. 95-707, eff. 1-11-08; 95-744, eff. 7-18-08; | 10 | | 96-45, eff. 7-15-09; 96-328, eff. 8-11-09; 96-959, eff. | 11 | | 7-1-10.)
| 12 | | Section 25. The Illinois Estate and Generation-Skipping | 13 | | Transfer Tax Act is amended by changing Section 2 as follows:
| 14 | | (35 ILCS 405/2) (from Ch. 120, par. 405A-2)
| 15 | | Sec. 2. Definitions.
| 16 | | "Federal estate tax" means the tax due to the United States | 17 | | with respect
to a taxable transfer under Chapter 11 of the | 18 | | Internal Revenue Code.
| 19 | | "Federal generation-skipping transfer tax" means the tax | 20 | | due to the
United States with respect to a taxable transfer | 21 | | under Chapter 13 of the
Internal Revenue Code.
| 22 | | "Federal return" means the federal estate tax return with | 23 | | respect to the
federal estate tax and means the federal | 24 | | generation-skipping transfer tax
return
with respect to the |
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| 1 | | federal generation-skipping transfer tax.
| 2 | | "Federal transfer tax" means the federal estate tax or the | 3 | | federal
generation-skipping transfer tax.
| 4 | | "Illinois estate tax" means the tax due to this State with | 5 | | respect to a
taxable transfer.
| 6 | | "Illinois generation-skipping transfer tax" means the tax | 7 | | due to this State
with respect to a taxable transfer that gives | 8 | | rise to a federal
generation-skipping transfer tax.
| 9 | | "Illinois transfer tax" means the Illinois estate tax or | 10 | | the Illinois
generation-skipping transfer tax.
| 11 | | "Internal Revenue Code" means, unless otherwise provided, | 12 | | the Internal
Revenue Code of 1986, as
amended from time to | 13 | | time.
| 14 | | "Non-resident trust" means a trust that is not a resident | 15 | | of this State
for purposes of the Illinois Income Tax Act, as | 16 | | amended from time to time.
| 17 | | "Person" means and includes any individual, trust, estate, | 18 | | partnership,
association, company or corporation.
| 19 | | "Qualified heir" means a qualified heir as defined in | 20 | | Section 2032A(e)(1)
of the Internal Revenue Code.
| 21 | | "Resident trust" means a trust that is a resident of this | 22 | | State for
purposes of the Illinois Income Tax Act, as amended | 23 | | from time to time.
| 24 | | "State" means any state, territory or possession of the | 25 | | United States and
the District of Columbia.
| 26 | | "State tax credit" means:
|
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| 1 | | (a) For persons dying on or after January 1, 2003 and
| 2 | | through December 31, 2005, an amount
equal
to the full credit | 3 | | calculable under Section 2011 or Section 2604 of the
Internal | 4 | | Revenue
Code as the credit would have been computed and allowed | 5 | | under the Internal
Revenue
Code as in effect on December 31, | 6 | | 2001, without the reduction in the State
Death Tax
Credit as | 7 | | provided in Section 2011(b)(2) or the termination of the State | 8 | | Death
Tax Credit
as provided in Section 2011(f) as enacted by | 9 | | the Economic Growth and Tax Relief
Reconciliation Act of 2001, | 10 | | but recognizing the increased applicable exclusion
amount
| 11 | | through December 31, 2005.
| 12 | | (b) For persons dying after December 31, 2005 and on or | 13 | | before December 31,
2009, and for persons dying after December | 14 | | 31, 2010, an amount equal to the full
credit
calculable under | 15 | | Section 2011 or 2604 of the Internal Revenue Code as the
credit | 16 | | would
have been computed and allowed under the Internal Revenue | 17 | | Code as in effect on
December 31, 2001, without the reduction | 18 | | in the State Death Tax Credit as
provided in
Section 2011(b)(2) | 19 | | or the termination of the State Death Tax Credit as provided
in
| 20 | | Section 2011(f) as enacted by the Economic Growth and Tax | 21 | | Relief Reconciliation
Act of
2001, but recognizing the | 22 | | exclusion amount of only $2,000,000, and with reduction to the | 23 | | adjusted taxable estate for any qualified terminable interest | 24 | | property election as defined in subsection (b-1) of this | 25 | | Section.
| 26 | | (b-1) The person required to file the Illinois return may |
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| 1 | | elect on a timely filed Illinois return a marital deduction for | 2 | | qualified terminable interest property under Section | 3 | | 2056(b)(7) of the Internal Revenue Code for purposes of the | 4 | | Illinois estate tax that is separate and independent of any | 5 | | qualified terminable interest property election for federal | 6 | | estate tax purposes. For purposes of the Illinois estate tax, | 7 | | the inclusion of property in the gross estate of a surviving | 8 | | spouse is the same as under Section 2044 of the Internal | 9 | | Revenue Code. | 10 | | In the case of any trust for which a State or federal | 11 | | qualified terminable interest property election is made, the | 12 | | trustee may not retain non-income producing assets for more | 13 | | than a reasonable amount of time without the consent of the | 14 | | surviving spouse. | 15 | | (c) For persons dying after December 31, 2009,
the credit | 16 | | for state tax allowable under Section
2011 or Section 2604 of | 17 | | the Internal Revenue Code.
| 18 | | "Taxable transfer" means an event that gives rise to a | 19 | | state tax credit,
including any credit as a result of the | 20 | | imposition of an
additional tax under Section 2032A(c) of the | 21 | | Internal Revenue Code.
| 22 | | "Transferee" means a transferee within the meaning of | 23 | | Section 2603(a)(1)
and Section 6901(h) of the Internal Revenue | 24 | | Code.
| 25 | | "Transferred property" means:
| 26 | | (1) With respect to a taxable transfer occurring at the |
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| 1 | | death of an
individual, the
deceased individual's gross | 2 | | estate as defined in Section 2031 of the
Internal Revenue | 3 | | Code.
| 4 | | (2) With respect to a taxable transfer occurring as a | 5 | | result of a
taxable termination as defined in Section | 6 | | 2612(a) of the Internal Revenue Code,
the taxable amount | 7 | | determined under Section 2622(a) of the Internal Revenue
| 8 | | Code.
| 9 | | (3) With respect to a taxable transfer occurring as a | 10 | | result of a
taxable distribution as defined in Section | 11 | | 2612(b) of the Internal Revenue Code,
the taxable amount | 12 | | determined under Section 2621(a) of the Internal Revenue
| 13 | | Code.
| 14 | | (4) With respect to an event which causes the | 15 | | imposition of an
additional estate tax under Section | 16 | | 2032A(c) of the Internal Revenue Code,
the
qualified real | 17 | | property that was disposed of or which ceased to be used | 18 | | for
the qualified use, within the meaning of Section | 19 | | 2032A(c)(1) of the Internal
Revenue Code.
| 20 | | "Trust" includes a trust as defined in Section 2652(b)(1) | 21 | | of the Internal
Revenue Code.
| 22 | | (Source: P.A. 96-789, eff. 9-8-09.)
| 23 | | Section 99. Effective date. This Act takes effect upon | 24 | | becoming law.".
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