HB5080 103RD GENERAL ASSEMBLY

LRB103 37735 HLH 67862 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB5080

Introduced 2/8/2024, by Rep. Lance Yednock

SYNOPSIS AS INTRODUCED:

New Act
35 ILCS 5/241 new

Creates the Illinois Farmers Who Fight Food Insecurity Act. Establishes an income tax credit for taxpayers who own farm property in the State and make a qualified donation of an agricultural or horticultural commodity, or a cash donation, to a food bank or a historically underserved farmer or rancher.

A BILL FOR

AN ACT concerning revenue.

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

Section 1. Short title. This Act may be cited as the Illinois Farmers Who Fight Food Insecurity Act.

Section 5. Definitions. As used in this Act:

"Department" means the Department of Human Services.

"Farm property" means real property that is used primarily for raising or harvesting agricultural or horticultural commodities for commercial sale.

"Food bank" means a food bank in Illinois that received funding from The Emergency Food Assistance Program (TEFAP) in the year in which it received the qualified donation.

"Historically underserved farmer or rancher" means an individual who: (i) is a beginning farmer or rancher, a socially disadvantaged farmer or rancher, a veteran farmer or rancher, or a limited resource farmer or rancher, as those terms are defined by the Natural Resources Conservation Service of the United States Department of Agriculture; and (ii) materially and substantially participates in the operation of farm property located in the State at least 50% of which is owned by a beginning farmer or rancher, a socially disadvantaged farmer or rancher, a veteran farmer or rancher, or some combination of those persons at the time the donation is made.

"Material and substantial participation" means day-to-day labor and management of farm property, consistent with the practices of the county in which the farm property is located.

"Qualified donation" means a donation to a food bank or to a historically underserved farmer or rancher of an agricultural or horticultural commodity that is suitable for human consumption and is produced on farm property owned by the taxpayer, a cash equivalent donation to a food bank or a historically underserved farmer or rancher, or some combination of those types of donations.

Section 10. Tax Credit.

(a) For taxable years beginning on or after January 1, 2025, each taxpayer who owns farm property in the State and makes a qualified donation during the taxable year is entitled to a credit against the taxes imposed by subsections (a) and (b) of Section 201 in an amount equal to the value of the qualified donation, but not to exceed $2,500 per taxpayer in any taxable year. Eligible taxpayers shall apply to the Department for a tax credit certificate for the credit under this Section, and the Department shall certify the value of the qualified donation. Upon satisfactory review of the application, the Department shall issue to the taxpayer a tax credit certificate stating the amount of the tax credit to which the taxpayer is entitled. The tax credit certificate shall be attached to the taxpayer's Illinois income tax return.

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

(c) For partners of partnerships and shareholders of Subchapter S corporations, there shall be allowed a credit under this Section to be determined in accordance with the determination of income and distributive share of income under Sections 702 and 704 and Subchapter S of the Internal Revenue Code.

(d) The Department, in addition to those powers granted elsewhere, is granted and has all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this Section, including, but not limited to, the following:

(1) adopt rules deemed necessary and appropriate for the administration of the tax credit program established under this Section;

(2) establish forms for applications, notifications, contracts, or other agreements related to the credit under this Section;

(3) accept applications for the credit under this Section at any time during the year;

(4) gather information and conduct inquiries for the purpose of administering the tax credit under this Section;

(5) provide for sufficient personnel to permit administrative, staffing, operating, and related support required to adequately discharge its duties and responsibilities described in this Section from funds as may be appropriated by the General Assembly for the administration of this Section; and

(6) require that the applicant at all times keep proper books and records of accounts relating to the tax credit award, in accordance with generally accepted accounting principles consistently applied, and make, upon reasonable written request by the Department, those books and records available for reasonable Department inspection and audit during the applicant's normal business hours; any documents or data made available to or received from the applicant by any agent, employee, officer, or service provider to the Department shall be deemed confidential and shall not constitute public records to the extent that the documents or data consist of commercial or financial information regarding the operation by the applicant of farm property.

Section 900. The Illinois Income Tax Act is amended by adding Section 241 as follows:

(35 ILCS 5/241 new)

Sec. 241. Illinois Farmers Who Fight Food Insecurity Act. Taxpayers who are awarded a credit under the Illinois Farmers Who Fight Food Insecurity Act are entitled to a credit against the taxes imposed by subsections (a) and (b) of Section 201 as provided in that Act.