Public Act 101-0009
 
SB0689 EnrolledLRB101 04450 HLH 49458 b


  
    AN ACT concerning revenue.
  
 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:
  



 
 
ARTICLE 10.   AMENDATORY PROVISIONS

 
    Section 10-3. The State Finance Act is amended  by changing 
Section 6z-81 as follows:
 
    (30 ILCS 105/6z-81)
    Sec. 6z-81. Healthcare Provider Relief Fund.
    (a)    There is created in the State treasury a special fund 
to be known as the Healthcare Provider Relief Fund.
    (b)  The Fund is created for the purpose of receiving and 
disbursing moneys in accordance with this Section. 
Disbursements from the Fund shall be made only as follows:
        (1)   Subject to appropriation, for payment by the 
    Department of Healthcare and


 Family Services or by the 
    Department of Human Services of medical bills and related 
    expenses, including administrative expenses, for which the 
    State is responsible under Titles XIX and XXI of the Social 
    Security Act, the Illinois Public Aid Code, the Children's 
    Health Insurance Program Act, the Covering ALL KIDS Health 
    Insurance Act, and the Long Term Acute Care Hospital 
    Quality Improvement Transfer Program Act.
        (2)    For repayment of funds borrowed from other State


 
    funds or from outside sources, including interest thereon.
        (3) For State fiscal years 2017, 2018, and 2019, for 
    making payments to the human poison control center pursuant 
    to Section 12-4.105 of the Illinois Public Aid Code.
    (c) The Fund shall consist of the following:
        (1)    Moneys received by the State from short-term


 
    borrowing pursuant to the Short Term Borrowing Act on or 
    after the effective date of Public Act 96-820.
        (2)   All federal matching funds received by the


 Illinois 
    Department of Healthcare and Family Services  as a result of 
    expenditures made by the Department that are attributable 
    to moneys deposited in the Fund.
        (3)   All federal matching funds received by the


 Illinois 
    Department of Healthcare and Family Services as a result of 
    federal approval of Title XIX State plan amendment 
    transmittal number 07-09.
        (3.5) Proceeds from the assessment authorized under 
    Article V-H of the Public Aid Code.
        (4)   All other moneys received for the Fund from any


 
    other source, including interest earned thereon.
        (5) All federal matching funds received by the
    Illinois 
    Department of Healthcare and Family Services as a result of 
    expenditures made by the Department for Medical Assistance 
    from the General Revenue Fund, the Tobacco Settlement 
    Recovery Fund, the Long-Term Care Provider Fund, and the 
    Drug Rebate Fund related to individuals eligible for 
    medical assistance pursuant to the Patient Protection and 
    Affordable Care Act (P.L. 111-148) and Section 5-2 of the 
    Illinois Public Aid Code. 
    (d) In addition to any other transfers that may be provided 
for by law, on the effective date of Public Act 97-44, or as 
soon thereafter as practical, the State Comptroller shall 
direct and the State Treasurer shall transfer the sum of 
$365,000,000 from the General Revenue Fund into the Healthcare 
Provider Relief Fund. 

    (e)  In addition to any other transfers that may be provided 
for by law, on July 1, 2011, or as soon thereafter as 
practical, the State Comptroller shall direct and the State 
Treasurer shall transfer the sum of $160,000,000 from the 
General Revenue Fund to the Healthcare Provider Relief Fund. 
    (f) Notwithstanding any other State law to the contrary, 
and in addition to any other transfers that may be provided for 
by law, the State Comptroller shall order transferred and the 
State Treasurer shall transfer $500,000,000 to the Healthcare 
Provider Relief Fund from the General Revenue Fund in equal 
monthly installments of $100,000,000, with the first transfer 
to be made on July 1, 2012, or as soon thereafter as practical, 
and with each of the remaining transfers to be made on August 
1, 2012, September 1, 2012, October 1, 2012, and November 1, 
2012, or as soon thereafter as practical. This transfer may 
assist the Department of Healthcare and Family Services in 
improving Medical Assistance bill processing timeframes or in 
meeting the possible requirements of Senate Bill 3397, or other 
similar legislation, of the 97th General Assembly should it 
become law. 
    (g) Notwithstanding any other State law to the contrary, 
and in addition to any other transfers that may be provided for 
by law, on July 1, 2013, or as soon thereafter as may be 
practical, the State Comptroller shall direct and the State 
Treasurer shall transfer the sum of $601,000,000 from the 
General Revenue Fund to the Healthcare Provider Relief Fund. 
(Source: P.A. 99-516, eff. 6-30-16; 100-587, eff. 6-4-18.)
 
    Section 10-5. The Illinois Income Tax Act is amended  by 
changing Section 203 as follows:
 
    (35 ILCS 5/203)  (from Ch. 120, par. 2-203)
    Sec. 203. Base income defined. 
    (a) Individuals.
        (1) In general.  In the case of an individual, base 
    income means an
amount equal to the taxpayer's adjusted 
    gross income for the taxable
year as modified by paragraph 
    (2).
        (2) Modifications.  The adjusted gross income referred 
    to in
paragraph (1) shall be modified by adding thereto the 
    sum of the
following amounts:
            (A) An amount equal to all amounts paid or accrued 
        to the taxpayer
as interest or dividends during the 
        taxable year to the extent excluded
from gross income 
        in the computation of adjusted gross income, except 
        stock
dividends of qualified public utilities 
        described in Section 305(e) of the
Internal Revenue 
        Code;
            (B) An amount equal to the amount of tax imposed by 
        this Act to the
extent deducted from gross income in 
        the computation of adjusted gross
income for the 
        taxable year;
            (C) An amount equal to the amount received during 
        the taxable year
as a recovery or refund of real 
        property taxes paid with respect to the
taxpayer's 
        principal residence under the Revenue Act of
1939 and 
        for which a deduction was previously taken under 
        subparagraph (L) of
this paragraph (2) prior to July 1, 
        1991, the retrospective application date of
Article 4 
        of Public Act 87-17.  In the case of multi-unit or 
        multi-use
structures and farm dwellings, the taxes on 
        the taxpayer's principal residence
shall be that 
        portion of the total taxes for the entire property 
        which is
attributable to such principal residence;
            (D) An amount equal to the amount of the capital 
        gain deduction
allowable under the Internal Revenue 
        Code, to the extent deducted from gross
income in the 
        computation of adjusted gross income;
            (D-5) An amount, to the extent not included in 
        adjusted gross income,
equal to the amount of money 
        withdrawn by the taxpayer in the taxable year from
a 
        medical care savings account and the interest earned on 
        the account in the
taxable year of a withdrawal 
        pursuant to subsection (b) of Section 20 of the
Medical 
        Care Savings Account Act or subsection (b) of Section 
        20 of the
Medical Care Savings Account Act of 2000;
            (D-10) For taxable years ending after December 31, 
        1997, an
amount equal to any eligible remediation costs 
        that the individual
deducted in computing adjusted 
        gross income and for which the
individual claims a 
        credit under subsection (l) of Section 201;
            (D-15) For taxable years 2001 and thereafter, an 
        amount equal to the
bonus depreciation deduction taken 
        on the taxpayer's federal income tax return for the 
        taxable
year under subsection (k) of Section 168 of the 
        Internal Revenue Code;
            (D-16) If the taxpayer sells, transfers, abandons, 
        or otherwise disposes of property for which the 
        taxpayer was required in any taxable year to
make an 
        addition modification under subparagraph (D-15), then 
        an amount equal
to the aggregate amount of the 
        deductions taken in all taxable
years under 
        subparagraph (Z) with respect to that property.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was allowed in any taxable year to make a subtraction 
        modification under subparagraph (Z), then an amount 
        equal to that subtraction modification.

            The taxpayer is required to make the addition 
        modification under this
subparagraph
only once with 
        respect to any one piece of property;
            (D-17) An amount equal to the amount otherwise 
        allowed as a deduction in computing base income for 
        interest paid, accrued, or incurred, directly or 
        indirectly, (i) for taxable years ending on or after 
        December 31, 2004, to a foreign person who would be a 
        member of the same unitary business group but for the 
        fact that foreign person's business activity outside 
        the United States is 80% or more of the foreign 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304. The addition modification 
        required by this subparagraph shall be reduced to the 
        extent that dividends were included in base income of 
        the unitary group for the same taxable year and 
        received by the taxpayer or by a member of the 
        taxpayer's unitary business group (including amounts 
        included in gross income under Sections 951 through 964 
        of the Internal Revenue Code and amounts included in 
        gross income under Section 78 of the Internal Revenue 
        Code) with respect to the stock of the same person to 
        whom the interest was paid, accrued, or incurred.
            This paragraph shall not apply to the following:

                (i) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person who 
            is subject in a foreign country or state, other 
            than a state which requires mandatory unitary 
            reporting, to a tax on or measured by net income 
            with respect to such interest; or
                (ii) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer can establish, based on a 
            preponderance of the evidence, both of the 
            following:
                    (a) the person, during the same taxable 
                year, paid, accrued, or incurred, the interest 
                to a person that is not a related member, and
                    (b) the transaction giving rise to the 
                interest expense between the taxpayer and the 
                person did not have as a principal purpose the 
                avoidance of Illinois income tax, and is paid 
                pursuant to a contract or agreement that 
                reflects an arm's-length interest rate and 
                terms; or

                (iii) the taxpayer can establish, based on 
            clear and convincing evidence, that the interest 
            paid, accrued, or incurred relates to a contract or 
            agreement entered into at arm's-length rates and 
            terms and the principal purpose for the payment is 
            not federal or Illinois tax avoidance; or

                (iv) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer establishes by clear and convincing 
            evidence that the adjustments are unreasonable; or 
            if the taxpayer and the Director agree in writing 
            to the application or use of an alternative method 
            of apportionment under Section 304(f).

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (D-18) An amount equal to the amount of intangible 
        expenses and costs otherwise allowed as a deduction in 
        computing base income, and that were paid, accrued, or 
        incurred, directly or indirectly, (i) for taxable 
        years ending on or after December 31, 2004, to a 
        foreign person who would be a member of the same 
        unitary business group but for the fact that the 
        foreign person's business activity outside the United 
        States is 80% or more of that person's total business 
        activity and (ii) for taxable years ending on or after 
        December 31, 2008, to a person who would be a member of 
        the same unitary business group but for the fact that 
        the person is prohibited under Section 1501(a)(27) 
        from being included in the unitary business group 
        because he or she is ordinarily required to apportion 
        business income under different subsections of Section 
        304. The addition modification required by this 
        subparagraph shall be reduced to the extent that 
        dividends were included in base income of the unitary 
        group for the same taxable year and received by the 
        taxpayer or by a member of the taxpayer's unitary 
        business group (including amounts included in gross 
        income under Sections 951 through 964 of the Internal 
        Revenue Code and amounts included in gross income under 
        Section 78 of the Internal Revenue Code) with respect 
        to the stock of the same person to whom the intangible 
        expenses and costs were directly or indirectly paid, 
        incurred, or accrued. The preceding sentence does not 
        apply to the extent that the same dividends caused a 
        reduction to the addition modification required under 
        Section 203(a)(2)(D-17) of this Act. As used in this 
        subparagraph, the term "intangible expenses and costs" 
        includes (1) expenses, losses, and costs for, or 
        related to, the direct or indirect acquisition, use, 
        maintenance or management, ownership, sale, exchange, 
        or any other disposition of intangible property; (2) 
        losses incurred, directly or indirectly, from 
        factoring transactions or discounting transactions; 
        (3) royalty, patent, technical, and copyright fees; 
        (4) licensing fees; and (5) other similar expenses and 
        costs.
For purposes of this subparagraph, "intangible 
        property" includes patents, patent applications, trade 
        names, trademarks, service marks, copyrights, mask 
        works, trade secrets, and similar types of intangible 
        assets.
            This paragraph shall not apply to the following:
                (i)         any item of intangible expenses or costs 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person who is 
            subject in a foreign country or state, other than a 
            state which requires mandatory unitary reporting, 
            to a tax on or measured by net income with respect 
            to such item; or
                (ii)        any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, if the taxpayer can establish, based 
            on a preponderance of the evidence, both of the 
            following:
                    (a) the person during the same taxable 
                year paid, accrued, or incurred, the 
                intangible expense or cost to a person that is 
                not a related member, and
                    (b) the transaction giving rise to the 
                intangible expense or cost between the 
                taxpayer and the person did not have as a 
                principal purpose the avoidance of Illinois 
                income tax, and is paid pursuant to a contract 
                or agreement that reflects arm's-length terms; 
                or
                (iii)       any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person if the 
            taxpayer establishes by clear and convincing 
            evidence, that the adjustments are unreasonable; 
            or if the taxpayer and the Director agree in 
            writing to the application or use of an alternative 
            method of apportionment under Section 304(f);

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (D-19) For taxable years ending on or after 
        December 31, 2008, an amount equal to the amount of 
        insurance premium expenses and costs otherwise allowed 
        as a deduction in computing base income, and that were 
        paid, accrued, or incurred, directly or indirectly, to 
        a person who would be a member of the same unitary 
        business group but for the fact that the person is 
        prohibited under Section 1501(a)(27) from being 
        included in the unitary business group because he or 
        she is ordinarily required to apportion business 
        income under different subsections of Section 304.  The 
        addition modification required by this subparagraph 
        shall be reduced to the extent that dividends were 
        included in base income of the unitary group for the 
        same taxable year and received by the taxpayer or by a 
        member of the taxpayer's unitary business group 
        (including amounts included in gross income under 
        Sections 951 through 964 of the Internal Revenue Code 
        and amounts included in gross income under Section 78 
        of the Internal Revenue Code) with respect to the stock 
        of the same person to whom the premiums and costs were 
        directly or indirectly paid, incurred, or accrued. The 
        preceding sentence does not apply to the extent that 
        the same dividends caused a reduction to the addition 
        modification required under Section 203(a)(2)(D-17) or 
        Section 203(a)(2)(D-18) of this Act.

            (D-20) For taxable years beginning on or after 
        January 1,
2002 and ending on or before December 31, 
        2006, in
the
case of a distribution from a qualified 
        tuition program under Section 529 of
the Internal 
        Revenue Code, other than (i) a distribution from a 
        College Savings
Pool created under Section 16.5 of the 
        State Treasurer Act or (ii) a
distribution from the 
        Illinois Prepaid Tuition Trust Fund, an amount equal to

        the amount excluded from gross income under Section 
        529(c)(3)(B). For taxable years beginning on or after 
        January 1, 2007, in the case of a distribution from a 
        qualified tuition program under Section 529 of the 
        Internal Revenue Code, other than (i) a distribution 
        from a College Savings Pool created under Section 16.5 
        of the State Treasurer Act, (ii) a distribution from 
        the Illinois Prepaid Tuition Trust Fund, or (iii) a 
        distribution from a qualified tuition program under 
        Section 529 of the Internal Revenue Code that (I) 
        adopts and determines that its offering materials 
        comply with the College Savings Plans Network's 
        disclosure principles and (II) has made reasonable 
        efforts to inform in-state residents of the existence 
        of in-state qualified tuition programs by informing 
        Illinois residents directly and, where applicable, to 
        inform financial intermediaries distributing the 
        program to inform in-state residents of the existence 
        of in-state qualified tuition programs at least 
        annually, an amount equal to the amount excluded from 
        gross income under Section 529(c)(3)(B).
            For the purposes of this subparagraph (D-20), a 
        qualified tuition program has made reasonable efforts 
        if it makes disclosures (which may use the term 
        "in-state program" or "in-state plan" and need not 
        specifically refer to Illinois or its qualified 
        programs by name) (i) directly to prospective 
        participants in its offering materials or makes a 
        public disclosure, such as a website posting; and (ii) 
        where applicable, to intermediaries selling the 
        out-of-state program in the same manner that the 
        out-of-state program distributes its offering 
        materials;
            (D-20.5)   For taxable years beginning on or after 
        January 1, 2018, in the case of a distribution from a 
        qualified ABLE program under Section 529A of the 
        Internal Revenue Code, other than a  distribution from a 
        qualified ABLE program created under Section 16.6 of 
        the State Treasurer  Act, an amount equal to the amount 
        excluded from gross income under Section 529A(c)(1)(B) 
        of  the Internal Revenue Code; 
            (D-21) For taxable years beginning on or after 
        January 1, 2007, in the case of transfer of moneys from 
        a qualified tuition program under Section 529 of the 
        Internal Revenue Code that is administered by the State 
        to an out-of-state program, an amount equal to the 
        amount of moneys previously deducted from base income 
        under subsection (a)(2)(Y) of this Section;
            (D-21.5)   For taxable years beginning on or after 
        January 1, 2018, in the case of the transfer of moneys 
        from a qualified tuition program under Section 529 or a 
        qualified ABLE program under  Section 529A of the 
        Internal Revenue Code that is administered by this 
        State to an ABLE account  established under an 
        out-of-state ABLE account program, an amount equal to 
        the contribution component of the transferred amount 
        that was previously deducted from base income under 
        subsection (a)(2)(Y) or subsection (a)(2)(HH) of this 
        Section; 
            (D-22) For taxable years beginning on or after 
        January 1, 2009, and prior to January 1, 2018, in the 
        case of a nonqualified withdrawal or refund of moneys 
        from a qualified tuition program under Section 529 of 
        the Internal Revenue Code administered by the State 
        that is not used for qualified expenses at an eligible 
        education institution, an amount equal to the 
        contribution component of the nonqualified withdrawal 
        or refund that was previously deducted from base income 
        under subsection (a)(2)(y) of this Section, provided 
        that the withdrawal or refund did not result from the 
        beneficiary's death or disability. For taxable years 
        beginning on or after January 1, 2018: (1) in the case 
        of a nonqualified withdrawal or refund, as defined 
        under Section
16.5 of the State Treasurer Act, of 
        moneys from a qualified tuition program under Section 
        529 of the Internal Revenue Code administered by the 
        State, an amount equal to the contribution  component of 
        the nonqualified withdrawal or refund that was 
        previously deducted from base
income under subsection 
        (a)(2)(Y) of this Section, and (2) in the case of a 
        nonqualified  withdrawal or refund from a qualified 
        ABLE program under Section 529A of the Internal  Revenue 
        Code administered by the State that is not used for 
        qualified disability expenses, an amount equal to the 
        contribution component of the nonqualified withdrawal 
        or refund that was previously deducted from base income 
        under subsection (a)(2)(HH) of this Section;
            (D-23)  An amount equal to the credit allowable to 
        the taxpayer under Section 218(a) of this Act, 
        determined without regard to Section 218(c) of this 
        Act;
            (D-24) For taxable years ending on or after 
        December 31, 2017, an amount equal to the deduction 
        allowed under Section 199 of the Internal Revenue Code 
        for the taxable year; 
    and by deducting from the total so obtained the
sum of the 
    following amounts:
            (E) For taxable years ending before December 31, 
        2001,
any amount included in such total in respect of 
        any compensation
(including but not limited to any 
        compensation paid or accrued to a
serviceman while a 
        prisoner of war or missing in action) paid to a 
        resident
by reason of being on active duty in the Armed 
        Forces of the United States
and in respect of any 
        compensation paid or accrued to a resident who as a

        governmental employee was a prisoner of war or missing 
        in action, and in
respect of any compensation paid to a 
        resident in 1971 or thereafter for
annual training 
        performed pursuant to Sections 502 and 503, Title 32,

        United States Code as a member of the Illinois National 
        Guard or, beginning with taxable years ending on or 
        after December 31, 2007, the National Guard of any 
        other state.
For taxable years ending on or after 
        December 31, 2001, any amount included in
such total in 
        respect of any compensation (including but not limited 
        to any
compensation paid or accrued to a serviceman 
        while a prisoner of war or missing
in action) paid to a 
        resident by reason of being a member of any component 
        of
the Armed Forces of the United States and in respect 
        of any compensation paid
or accrued to a resident who 
        as a governmental employee was a prisoner of war
or 
        missing in action, and in respect of any compensation 
        paid to a resident in
2001 or thereafter by reason of 
        being a member of the Illinois National Guard or, 
        beginning with taxable years ending on or after 
        December 31, 2007, the National Guard of any other 
        state.
The provisions of this subparagraph (E) are 
        exempt
from the provisions of Section 250;
            (F) An amount equal to all amounts included in such 
        total pursuant
to the provisions of Sections 402(a), 
        402(c), 403(a), 403(b), 406(a), 407(a),
and 408 of the 
        Internal Revenue Code, or included in such total as

        distributions under the provisions of any retirement 
        or disability plan for
employees of any governmental 
        agency or unit, or retirement payments to
retired 
        partners, which payments are excluded in computing net 
        earnings
from self employment by Section 1402 of the 
        Internal Revenue Code and
regulations adopted pursuant 
        thereto;
            (G) The valuation limitation amount;
            (H) An amount equal to the amount of any tax 
        imposed by this Act
which was refunded to the taxpayer 
        and included in such total for the
taxable year;
            (I) An amount equal to all amounts included in such 
        total pursuant
to the provisions of Section 111 of the 
        Internal Revenue Code as a
recovery of items previously 
        deducted from adjusted gross income in the
computation 
        of taxable income;
            (J) An amount equal to those dividends included in 
        such total which were
paid by a corporation which 
        conducts business operations in a River Edge 
        Redevelopment Zone or zones created under the River 
        Edge Redevelopment Zone Act, and conducts

        substantially all of its operations in a River Edge 
        Redevelopment Zone or zones. This subparagraph (J) is 
        exempt from the provisions of Section 250;
            (K) An amount equal to those dividends included in 
        such total that
were paid by a corporation that 
        conducts business operations in a federally
designated 
        Foreign Trade Zone or Sub-Zone and that is designated a 
        High Impact
Business located in Illinois; provided 
        that dividends eligible for the
deduction provided in 
        subparagraph (J) of paragraph (2) of this subsection

        shall not be eligible for the deduction provided under 
        this subparagraph
(K);
            (L) For taxable years ending after December 31, 
        1983, an amount equal to
all social security benefits 
        and railroad retirement benefits included in
such 
        total pursuant to Sections 72(r) and 86 of the Internal 
        Revenue Code;
            (M) With the exception of any amounts subtracted 
        under subparagraph
(N), an amount equal to the sum of 
        all amounts disallowed as
deductions by (i) Sections 
        171(a)(2), and 265(a)(2) 265(2) of the Internal 
        Revenue Code, and all amounts of expenses allocable
to 
        interest and  disallowed as deductions by Section 
        265(a)(1) 265(1) of the Internal
Revenue Code;
and (ii) 
        for taxable years
ending on or after August 13, 1999, 
        Sections 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of 
        the Internal Revenue Code, plus, for taxable years 
        ending on or after December 31, 2011, Section 45G(e)(3) 
        of the Internal Revenue Code and, for taxable years 
        ending on or after December 31, 2008, any amount 
        included in gross income under Section 87 of the 
        Internal Revenue Code; the provisions of this

        subparagraph are exempt from the provisions of Section 
        250;
            (N) An amount equal to all amounts included in such 
        total which are
exempt from taxation by this State 
        either by reason of its statutes or
Constitution
or by 
        reason of the Constitution, treaties or statutes of the 
        United States;
provided that, in the case of any 
        statute of this State that exempts income
derived from 
        bonds or other obligations from the tax imposed under 
        this Act,
the amount exempted shall be the interest net 
        of bond premium amortization;
            (O) An amount equal to any contribution made to a 
        job training
project established pursuant to the Tax 
        Increment Allocation Redevelopment Act;
            (P) An amount equal to the amount of the deduction 
        used to compute the
federal income tax credit for 
        restoration of substantial amounts held under
claim of 
        right for the taxable year pursuant to Section 1341 of 
        the
Internal Revenue Code or of any itemized deduction 
        taken from adjusted gross income in the computation of 
        taxable income for restoration of substantial amounts 
        held under claim of right for the taxable year;
            (Q) An amount equal to any amounts included in such 
        total, received by
the taxpayer as an acceleration in 
        the payment of life, endowment or annuity
benefits in 
        advance of the time they would otherwise be payable as 
        an indemnity
for a terminal illness;
            (R) An amount equal to the amount of any federal or 
        State bonus paid
to veterans of the Persian Gulf War;
            (S) An amount, to the extent included in adjusted 
        gross income, equal
to the amount of a contribution 
        made in the taxable year on behalf of the
taxpayer to a 
        medical care savings account established under the 
        Medical Care
Savings Account Act or the Medical Care 
        Savings Account Act of 2000 to the
extent the 
        contribution is accepted by the account
administrator 
        as provided in that Act;
            (T) An amount, to the extent included in adjusted 
        gross income, equal to
the amount of interest earned in 
        the taxable year on a medical care savings
account 
        established under the Medical Care Savings Account Act 
        or the Medical
Care Savings Account Act of 2000 on 
        behalf of the
taxpayer, other than interest added 
        pursuant to item (D-5) of this paragraph
(2);
            (U) For one taxable year beginning on or after 
        January 1,
1994, an
amount equal to the total amount of 
        tax imposed and paid under subsections (a)
and (b) of 
        Section 201 of this Act on grant amounts received by 
        the taxpayer
under the Nursing Home Grant Assistance 
        Act during the taxpayer's taxable years
1992 and 1993;
            (V) Beginning with tax years ending on or after 
        December 31, 1995 and
ending with tax years ending on 
        or before December 31, 2004, an amount equal to
the 
        amount paid by a taxpayer who is a
self-employed 
        taxpayer, a partner of a partnership, or a
shareholder 
        in a Subchapter S corporation for health insurance or 
        long-term
care insurance for that taxpayer or that 
        taxpayer's spouse or dependents, to
the extent that the 
        amount paid for that health insurance or long-term care

        insurance may be deducted under Section 213 of the 
        Internal Revenue Code, has not been deducted on the 
        federal income tax return of the taxpayer,
and does not 
        exceed the taxable income attributable to that 
        taxpayer's income,
self-employment income, or 
        Subchapter S corporation income; except that no

        deduction shall be allowed under this item (V) if the 
        taxpayer is eligible to
participate in any health 
        insurance or long-term care insurance plan of an

        employer of the taxpayer or the taxpayer's
spouse.  The 
        amount of the health insurance and long-term care 
        insurance
subtracted under this item (V) shall be 
        determined by multiplying total
health insurance and 
        long-term care insurance premiums paid by the taxpayer

        times a number that represents the fractional 
        percentage of eligible medical
expenses under Section 
        213 of the Internal Revenue Code of 1986 not actually

        deducted on the taxpayer's federal income tax return;
            (W) For taxable years beginning on or after January 
        1, 1998,
all amounts included in the taxpayer's federal 
        gross income
in the taxable year from amounts converted 
        from a regular IRA to a Roth IRA.
This paragraph is 
        exempt from the provisions of Section
250;
            (X) For taxable year 1999 and thereafter, an amount 
        equal to the
amount of any (i) distributions, to the 
        extent includible in gross income for
federal income 
        tax purposes, made to the taxpayer because of his or 
        her status
as a victim of persecution for racial or 
        religious reasons by Nazi Germany or
any other Axis 
        regime or as an heir of the victim and (ii) items
of 
        income, to the extent
includible in gross income for 
        federal income tax purposes, attributable to,
derived 
        from or in any way related to assets stolen from, 
        hidden from, or
otherwise lost to a victim of

        persecution for racial or religious reasons by Nazi 
        Germany or any other Axis
regime immediately prior to, 
        during, and immediately after World War II,
including, 
        but
not limited to, interest on the proceeds receivable 
        as insurance
under policies issued to a victim of 
        persecution for racial or religious
reasons
by Nazi 
        Germany or any other Axis regime by European insurance 
        companies
immediately prior to and during World War II;

        provided, however, this subtraction from federal 
        adjusted gross income does not
apply to assets acquired 
        with such assets or with the proceeds from the sale of

        such assets; provided, further, this paragraph shall 
        only apply to a taxpayer
who was the first recipient of 
        such assets after their recovery and who is a
victim of 
        persecution for racial or religious reasons
by Nazi 
        Germany or any other Axis regime or as an heir of the 
        victim.  The
amount of and the eligibility for any 
        public assistance, benefit, or
similar entitlement is 
        not affected by the inclusion of items (i) and (ii) of

        this paragraph in gross income for federal income tax 
        purposes.
This paragraph is exempt from the provisions 
        of Section 250;
            (Y) For taxable years beginning on or after January 
        1, 2002
and ending
on or before December 31, 2004, 
        moneys contributed in the taxable year to a College 
        Savings Pool account under
Section 16.5 of the State 
        Treasurer Act, except that amounts excluded from
gross 
        income under Section 529(c)(3)(C)(i) of the Internal 
        Revenue Code
shall not be considered moneys 
        contributed under this subparagraph (Y).  For taxable 
        years beginning on or after January 1, 2005, a maximum 
        of $10,000
contributed
in the
taxable year to (i) a 
        College Savings Pool account under Section 16.5 of the

        State
Treasurer Act or (ii) the Illinois Prepaid 
        Tuition Trust Fund,
except that
amounts excluded from 
        gross income under Section 529(c)(3)(C)(i) of the

        Internal
Revenue Code shall not be considered moneys 
        contributed under this subparagraph
(Y). For purposes 
        of this subparagraph, contributions made by an 
        employer on behalf of an employee, or matching 
        contributions made by an employee, shall be treated as 
        made by the employee. This
subparagraph (Y) is exempt 
        from the provisions of Section 250;
            (Z) For taxable years 2001 and thereafter, for the 
        taxable year in
which the bonus depreciation deduction

        is taken on the taxpayer's federal income tax return 
        under
subsection (k) of Section 168 of the Internal 
        Revenue Code and for each
applicable taxable year 
        thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation 
            deduction taken for the
taxable year
on the 
            taxpayer's federal income tax return on property 
            for which the bonus
depreciation deduction
was 
            taken in any year under subsection (k) of Section 
            168 of the Internal
Revenue Code, but not including 
            the bonus depreciation deduction;
                (2) for taxable years ending on or before 
            December 31, 2005, "x" equals "y" multiplied by 30 
            and then divided by 70 (or "y"
multiplied by 
            0.429); and
                (3) for taxable years ending after December 
            31, 2005:
                    (i) for property on which a bonus 
                depreciation deduction of 30% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                30 and then divided by 70 (or "y"
multiplied by 
                0.429); and
                    (ii) for property on which a bonus 
                depreciation deduction of 50% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                1.0.
            The aggregate amount deducted under this 
        subparagraph in all taxable
years for any one piece of 
        property may not exceed the amount of the bonus

        depreciation deduction
taken on that property on the 
        taxpayer's federal income tax return under
subsection 
        (k) of Section 168 of the Internal Revenue Code. This 
        subparagraph (Z) is exempt from the provisions of 
        Section 250;
            (AA) If the taxpayer sells, transfers, abandons, 
        or otherwise disposes of

property for which the 
        taxpayer was required in any taxable year to make an

        addition modification under subparagraph (D-15), then 
        an amount equal to that
addition modification.

            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was required in any taxable year to make an addition 
        modification under subparagraph (D-15), then an amount 
        equal to that addition modification.

            The taxpayer is allowed to take the deduction under 
        this subparagraph
only once with respect to any one 
        piece of property.
            This subparagraph (AA) is exempt from the 
        provisions of Section 250;
            (BB) Any amount included in adjusted gross income, 
        other
than
salary,
received by a driver in a 
        ridesharing arrangement using a motor vehicle;
            (CC) The amount of (i) any interest income (net of 
        the deductions allocable thereto) taken into account 
        for the taxable year with respect to a transaction with 
        a taxpayer that is required to make an addition 
        modification with respect to such transaction under 
        Section 203(a)(2)(D-17), 203(b)(2)(E-12), 
        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed 
        the amount of that addition modification, and

(ii) any 
        income from intangible property (net of the deductions 
        allocable thereto) taken into account for the taxable 
        year with respect to a transaction with a taxpayer that 
        is required to make an addition modification with 
        respect to such transaction under Section 
        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 
        203(d)(2)(D-8), but not to exceed the amount of that 
        addition modification. This subparagraph (CC) is 
        exempt from the provisions of Section 250;
            (DD) An amount equal to the interest income taken 
        into account for the taxable year (net of the 
        deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(a)(2)(D-17) for 
        interest paid, accrued, or incurred, directly or 
        indirectly, to the same person. This subparagraph (DD) 
        is exempt from the provisions of Section 250; 
            (EE) An amount equal to the income from intangible 
        property taken into account for the taxable year (net 
        of the deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(a)(2)(D-18) for 
        intangible expenses and costs paid, accrued, or 
        incurred, directly or indirectly, to the same foreign 
        person. This subparagraph (EE) is exempt from the 
        provisions of Section 250;
            (FF) An amount equal to any amount awarded to the 
        taxpayer during the taxable year by the Court of Claims 
        under subsection (c) of Section 8 of the Court of 
        Claims Act for time unjustly served in a State prison.  
        This subparagraph (FF) is exempt from the provisions of 
        Section 250; 
            (GG)  For taxable years ending on or after December 
        31, 2011, in the case of a taxpayer who was required to 
        add back any insurance premiums under Section 
        203(a)(2)(D-19), such taxpayer may elect to subtract 
        that part of a reimbursement received from the 
        insurance company equal to the amount of the expense or 
        loss (including expenses incurred by the insurance 
        company) that would have been taken into account as a 
        deduction for federal income tax purposes if the 
        expense or loss had been uninsured. If a taxpayer makes 
        the election provided for by this subparagraph (GG), 
        the insurer to which the premiums were paid must add 
        back to income the amount subtracted by the taxpayer 
        pursuant to this subparagraph (GG).  This subparagraph 
        (GG) is exempt from the provisions of Section 250; and 
            (HH)   For taxable years beginning on or after 
        January 1, 2018 and prior to January 1, 2023, a maximum 
        of $10,000 contributed in the taxable year to a 
        qualified ABLE account under Section 16.6 of the State 
        Treasurer Act, except that amounts excluded from gross 
        income under Section 529(c)(3)(C)(i) or Section 
        529A(c)(1)(C) of the Internal Revenue Code shall not be 
        considered moneys contributed under this subparagraph 
        (HH). For purposes of this subparagraph (HH), 
        contributions made by an employer on behalf of an 
        employee, or matching contributions made by an 
        employee, shall be treated as  made by the employee. 
 
    (b) Corporations.
        (1) In general.  In the case of a corporation, base 
    income means an
amount equal to the taxpayer's taxable 
    income for the taxable year as
modified by paragraph (2).
        (2) Modifications.  The taxable income referred to in 
    paragraph (1)
shall be modified by adding thereto the sum 
    of the following amounts:
            (A) An amount equal to all amounts paid or accrued 
        to the taxpayer
as interest and all distributions 
        received from regulated investment
companies during 
        the taxable year to the extent excluded from gross

        income in the computation of taxable income;
            (B) An amount equal to the amount of tax imposed by 
        this Act to the
extent deducted from gross income in 
        the computation of taxable income
for the taxable year;
            (C) In the case of a regulated investment company, 
        an amount equal to
the excess of (i) the net long-term 
        capital gain for the taxable year, over
(ii) the amount 
        of the capital gain dividends designated as such in 
        accordance
with Section 852(b)(3)(C) of the Internal 
        Revenue Code and any amount
designated under Section 
        852(b)(3)(D) of the Internal Revenue Code,

        attributable to the taxable year (this amendatory Act 
        of 1995
(Public Act 89-89) is declarative of existing 
        law and is not a new
enactment);
            (D) The amount of any net operating loss deduction 
        taken in arriving
at taxable income, other than a net 
        operating loss carried forward from a
taxable year 
        ending prior to December 31, 1986;
            (E) For taxable years in which a net operating loss 
        carryback or
carryforward from a taxable year ending 
        prior to December 31, 1986 is an
element of taxable 
        income under paragraph (1) of subsection (e) or

        subparagraph (E) of paragraph (2) of subsection (e), 
        the amount by which
addition modifications other than 
        those provided by this subparagraph (E)
exceeded 
        subtraction modifications in such earlier taxable 
        year, with the
following limitations applied in the 
        order that they are listed:
                (i) the addition modification relating to the 
            net operating loss
carried back or forward to the 
            taxable year from any taxable year ending
prior to 
            December 31, 1986 shall be reduced by the amount of 
            addition
modification under this subparagraph (E) 
            which related to that net operating
loss and which 
            was taken into account in calculating the base 
            income of an
earlier taxable year, and
                (ii) the addition modification relating to the 
            net operating loss
carried back or forward to the 
            taxable year from any taxable year ending
prior to 
            December 31, 1986 shall not exceed the amount of 
            such carryback or
carryforward;
            For taxable years in which there is a net operating 
        loss carryback or
carryforward from more than one other 
        taxable year ending prior to December
31, 1986, the 
        addition modification provided in this subparagraph 
        (E) shall
be the sum of the amounts computed 
        independently under the preceding
provisions of this 
        subparagraph (E) for each such taxable year;
            (E-5) For taxable years ending after December 31, 
        1997, an
amount equal to any eligible remediation costs 
        that the corporation
deducted in computing adjusted 
        gross income and for which the
corporation claims a 
        credit under subsection (l) of Section 201;
            (E-10) For taxable years 2001 and thereafter, an 
        amount equal to the
bonus depreciation deduction taken 
        on the taxpayer's federal income tax return for the 
        taxable
year under subsection (k) of Section 168 of the 
        Internal Revenue Code;
            (E-11) If the taxpayer sells, transfers, abandons, 
        or otherwise disposes of property for which the 
        taxpayer was required in any taxable year to
make an 
        addition modification under subparagraph (E-10), then 
        an amount equal
to the aggregate amount of the 
        deductions taken in all taxable
years under 
        subparagraph (T) with respect to that property.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was allowed in any taxable year to make a subtraction 
        modification under subparagraph (T), then an amount 
        equal to that subtraction modification.

            The taxpayer is required to make the addition 
        modification under this
subparagraph
only once with 
        respect to any one piece of property;
            (E-12) An amount equal to the amount otherwise 
        allowed as a deduction in computing base income for 
        interest paid, accrued, or incurred, directly or 
        indirectly, (i) for taxable years ending on or after 
        December 31, 2004, to a foreign person who would be a 
        member of the same unitary business group but for the 
        fact the foreign person's business activity outside 
        the United States is 80% or more of the foreign 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304. The addition modification 
        required by this subparagraph shall be reduced to the 
        extent that dividends were included in base income of 
        the unitary group for the same taxable year and 
        received by the taxpayer or by a member of the 
        taxpayer's unitary business group (including amounts 
        included in gross income pursuant to Sections 951 
        through 964 of the Internal Revenue Code and amounts 
        included in gross income under Section 78 of the 
        Internal Revenue Code) with respect to the stock of the 
        same person to whom the interest was paid, accrued, or 
        incurred.

            This paragraph shall not apply to the following:

                (i) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person who 
            is subject in a foreign country or state, other 
            than a state which requires mandatory unitary 
            reporting, to a tax on or measured by net income 
            with respect to such interest; or
                (ii) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer can establish, based on a 
            preponderance of the evidence, both of the 
            following:
                    (a) the person, during the same taxable 
                year, paid, accrued, or incurred, the interest 
                to a person that is not a related member, and
                    (b) the transaction giving rise to the 
                interest expense between the taxpayer and the 
                person did not have as a principal purpose the 
                avoidance of Illinois income tax, and is paid 
                pursuant to a contract or agreement that 
                reflects an arm's-length interest rate and 
                terms; or

                (iii) the taxpayer can establish, based on 
            clear and convincing evidence, that the interest 
            paid, accrued, or incurred relates to a contract or 
            agreement entered into at arm's-length rates and 
            terms and the principal purpose for the payment is 
            not federal or Illinois tax avoidance; or

                (iv) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer establishes by clear and convincing 
            evidence that the adjustments are unreasonable; or 
            if the taxpayer and the Director agree in writing 
            to the application or use of an alternative method 
            of apportionment under Section 304(f).

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (E-13) An amount equal to the amount of intangible 
        expenses and costs otherwise allowed as a deduction in 
        computing base income, and that were paid, accrued, or 
        incurred, directly or indirectly, (i) for taxable 
        years ending on or after December 31, 2004, to a 
        foreign person who would be a member of the same 
        unitary business group but for the fact that the 
        foreign person's business activity outside the United 
        States is 80% or more of that person's total business 
        activity and (ii) for taxable years ending on or after 
        December 31, 2008, to a person who would be a member of 
        the same unitary business group but for the fact that 
        the person is prohibited under Section 1501(a)(27) 
        from being included in the unitary business group 
        because he or she is ordinarily required to apportion 
        business income under different subsections of Section 
        304. The addition modification required by this 
        subparagraph shall be reduced to the extent that 
        dividends were included in base income of the unitary 
        group for the same taxable year and received by the 
        taxpayer or by a member of the taxpayer's unitary 
        business group (including amounts included in gross 
        income pursuant to Sections 951 through 964 of the 
        Internal Revenue Code and amounts included in gross 
        income under Section 78 of the Internal Revenue Code) 
        with respect to the stock of the same person to whom 
        the intangible expenses and costs were directly or 
        indirectly paid, incurred, or accrued. The preceding 
        sentence shall not apply to the extent that the same 
        dividends caused a reduction to the addition 
        modification required under Section 203(b)(2)(E-12) of 
        this Act.
As used in this subparagraph, the term 
        "intangible expenses and costs" includes (1) expenses, 
        losses, and costs for, or related to, the direct or 
        indirect acquisition, use, maintenance or management, 
        ownership, sale, exchange, or any other disposition of 
        intangible property; (2) losses incurred, directly or 
        indirectly, from factoring transactions or discounting 
        transactions; (3) royalty, patent, technical, and 
        copyright fees; (4) licensing fees; and (5) other 
        similar expenses and costs.
For purposes of this 
        subparagraph, "intangible property" includes patents, 
        patent applications, trade names, trademarks, service 
        marks, copyrights, mask works, trade secrets, and 
        similar types of intangible assets.
            This paragraph shall not apply to the following:
                (i)         any item of intangible expenses or costs 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person who is 
            subject in a foreign country or state, other than a 
            state which requires mandatory unitary reporting, 
            to a tax on or measured by net income with respect 
            to such item; or
                (ii)        any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, if the taxpayer can establish, based 
            on a preponderance of the evidence, both of the 
            following:
                    (a) the person during the same taxable 
                year paid, accrued, or incurred, the 
                intangible expense or cost to a person that is 
                not a related member, and
                    (b) the transaction giving rise to the 
                intangible expense or cost between the 
                taxpayer and the person did not have as a 
                principal purpose the avoidance of Illinois 
                income tax, and is paid pursuant to a contract 
                or agreement that reflects arm's-length terms; 
                or
                (iii)       any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person if the 
            taxpayer establishes by clear and convincing 
            evidence, that the adjustments are unreasonable; 
            or if the taxpayer and the Director agree in 
            writing to the application or use of an alternative 
            method of apportionment under Section 304(f);

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (E-14) For taxable years ending on or after 
        December 31, 2008, an amount equal to the amount of 
        insurance premium expenses and costs otherwise allowed 
        as a deduction in computing base income, and that were 
        paid, accrued, or incurred, directly or indirectly, to 
        a person who would be a member of the same unitary 
        business group but for the fact that the person is 
        prohibited under Section 1501(a)(27) from being 
        included in the unitary business group because he or 
        she is ordinarily required to apportion business 
        income under different subsections of Section 304.  The 
        addition modification required by this subparagraph 
        shall be reduced to the extent that dividends were 
        included in base income of the unitary group for the 
        same taxable year and received by the taxpayer or by a 
        member of the taxpayer's unitary business group 
        (including amounts included in gross income under 
        Sections 951 through 964 of the Internal Revenue Code 
        and amounts included in gross income under Section 78 
        of the Internal Revenue Code) with respect to the stock 
        of the same person to whom the premiums and costs were 
        directly or indirectly paid, incurred, or accrued. The 
        preceding sentence does not apply to the extent that 
        the same dividends caused a reduction to the addition 
        modification required under Section 203(b)(2)(E-12) or 
        Section 203(b)(2)(E-13) of this Act;

            (E-15) For taxable years beginning after December 
        31, 2008, any deduction for dividends paid by a captive 
        real estate investment trust that is allowed to a real 
        estate investment trust under Section 857(b)(2)(B) of 
        the Internal Revenue Code for dividends paid;
            (E-16)  An amount equal to the credit allowable to 
        the taxpayer under Section 218(a) of this Act, 
        determined without regard to Section 218(c) of this 
        Act;
            (E-17)  For taxable years ending on or after 
        December 31, 2017, an amount equal to the deduction 
        allowed under Section 199 of the Internal Revenue Code 
        for the taxable year; 
            (E-18) for taxable years beginning after December 
        31, 2018, an amount equal to the deduction allowed 
        under Section 250(a)(1)(A) of the Internal Revenue 
        Code for the taxable year. 
    and by deducting from the total so obtained the sum of the 
    following
amounts:
            (F) An amount equal to the amount of any tax 
        imposed by this Act
which was refunded to the taxpayer 
        and included in such total for the
taxable year;
            (G) An amount equal to any amount included in such 
        total under
Section 78 of the Internal Revenue Code;
            (H) In the case of a regulated investment company, 
        an amount equal
to the amount of exempt interest 
        dividends as defined in subsection (b)(5) of Section 
        852 of the Internal Revenue Code, paid to shareholders

        for the taxable year;
            (I) With the exception of any amounts subtracted 
        under subparagraph
(J),
an amount equal to the sum of 
        all amounts disallowed as
deductions by (i) Sections 
        171(a)(2), and 265(a)(2) and amounts disallowed as

        interest expense by Section 291(a)(3) of the Internal 
        Revenue Code, and all amounts of expenses allocable to 
        interest and
disallowed as deductions by Section 
        265(a)(1) of the Internal Revenue Code;
and (ii) for 
        taxable years
ending on or after August 13, 1999, 
        Sections
171(a)(2), 265,
280C, 291(a)(3), and 
        832(b)(5)(B)(i) of the Internal Revenue Code, plus, 
        for tax years ending on or after December 31, 2011, 
        amounts disallowed as deductions by Section 45G(e)(3) 
        of the Internal Revenue Code and, for taxable years 
        ending on or after December 31, 2008, any amount 
        included in gross income under Section 87 of the 
        Internal Revenue Code and the policyholders' share of 
        tax-exempt interest of a life insurance company under 
        Section 807(a)(2)(B) of the Internal Revenue Code (in 
        the case of a life insurance company with gross income 
        from a decrease in reserves for the tax year) or 
        Section 807(b)(1)(B) of the Internal Revenue Code (in 
        the case of a life insurance company allowed a 
        deduction for an increase in reserves for the tax 
        year); the
provisions of this
subparagraph are exempt 
        from the provisions of Section 250;
            (J) An amount equal to all amounts included in such 
        total which are
exempt from taxation by this State 
        either by reason of its statutes or
Constitution
or by 
        reason of the Constitution, treaties or statutes of the 
        United States;
provided that, in the case of any 
        statute of this State that exempts income
derived from 
        bonds or other obligations from the tax imposed under 
        this Act,
the amount exempted shall be the interest net 
        of bond premium amortization;
            (K) An amount equal to those dividends included in 
        such total
which were paid by a corporation which 
        conducts
business operations in a River Edge 
        Redevelopment Zone or zones created under the River 
        Edge Redevelopment Zone Act and conducts substantially 
        all of its
operations in a River Edge Redevelopment 
        Zone or zones. This subparagraph (K) is exempt from the 
        provisions of Section 250;
            (L) An amount equal to those dividends included in 
        such total that
were paid by a corporation that 
        conducts business operations in a federally
designated 
        Foreign Trade Zone or Sub-Zone and that is designated a 
        High Impact
Business located in Illinois; provided 
        that dividends eligible for the
deduction provided in 
        subparagraph (K) of paragraph 2 of this subsection

        shall not be eligible for the deduction provided under 
        this subparagraph
(L);
            (M) For any taxpayer that is a financial 
        organization within the meaning
of Section 304(c) of 
        this Act, an amount included in such total as interest

        income from a loan or loans made by such taxpayer to a 
        borrower, to the extent
that such a loan is secured by 
        property which is eligible for the River Edge 
        Redevelopment Zone Investment Credit.   To determine the 
        portion of a loan or loans that is
secured by property 
        eligible for a Section 201(f) investment
credit to the 
        borrower, the entire principal amount of the loan or 
        loans
between the taxpayer and the borrower should be 
        divided into the basis of the
Section 201(f) investment 
        credit property which secures the
loan or loans, using 
        for this purpose the original basis of such property on

        the date that it was placed in service in the River 
        Edge Redevelopment Zone.  The subtraction modification 
        available to the taxpayer in any
year under this 
        subsection shall be that portion of the total interest 
        paid
by the borrower with respect to such loan 
        attributable to the eligible
property as calculated 
        under the previous sentence. This subparagraph (M) is 
        exempt from the provisions of Section 250;
            (M-1) For any taxpayer that is a financial 
        organization within the
meaning of Section 304(c) of 
        this Act, an amount included in such total as
interest 
        income from a loan or loans made by such taxpayer to a 
        borrower,
to the extent that such a loan is secured by 
        property which is eligible for
the High Impact Business 
        Investment Credit.  To determine the portion of a
loan 
        or loans that is secured by property eligible for a 
        Section 201(h) investment credit to the borrower, the 
        entire principal amount of
the loan or loans between 
        the taxpayer and the borrower should be divided into

        the basis of the Section 201(h) investment credit 
        property which
secures the loan or loans, using for 
        this purpose the original basis of such
property on the 
        date that it was placed in service in a federally 
        designated
Foreign Trade Zone or Sub-Zone located in 
        Illinois.  No taxpayer that is
eligible for the 
        deduction provided in subparagraph (M) of paragraph 
        (2) of
this subsection shall be eligible for the 
        deduction provided under this
subparagraph (M-1).  The 
        subtraction modification available to taxpayers in
any 
        year under this subsection shall be that portion of the 
        total interest
paid by the borrower with respect to 
        such loan attributable to the eligible
property as 
        calculated under the previous sentence;
            (N) Two times any contribution made during the 
        taxable year to a
designated zone organization to the 
        extent that the contribution (i)
qualifies as a 
        charitable contribution under subsection (c) of 
        Section 170
of the Internal Revenue Code and (ii) must, 
        by its terms, be used for a
project approved by the 
        Department of Commerce and Economic Opportunity under 
        Section 11 of the Illinois Enterprise Zone Act or under 
        Section 10-10 of the River Edge Redevelopment Zone Act.  
        This subparagraph (N) is exempt from the provisions of 
        Section 250;
            (O) An amount equal to: (i) 85% for taxable years 
        ending on or before
December 31, 1992, or, a percentage 
        equal to the percentage allowable under
Section 
        243(a)(1) of the Internal Revenue Code of 1986 for 
        taxable years ending
after December 31, 1992, of the 
        amount by which dividends included in taxable
income 
        and received from a corporation that is not created or 
        organized under
the laws of the United States or any 
        state or political subdivision thereof,
including, for 
        taxable years ending on or after December 31, 1988, 
        dividends
received or deemed received or paid or deemed 
        paid under Sections 951 through
965 of the Internal 
        Revenue Code, exceed the amount of the modification

        provided under subparagraph (G) of paragraph (2) of 
        this subsection (b) which
is related to such dividends, 
        and including, for taxable years ending on or after 
        December 31, 2008, dividends received from a captive 
        real estate investment trust; plus (ii) 100% of the 
        amount by which dividends,
included in taxable income 
        and received, including, for taxable years ending on
or 
        after December 31, 1988, dividends received or deemed 
        received or paid or
deemed paid under Sections 951 
        through 964 of the Internal Revenue Code and including, 
        for taxable years ending on or after December 31, 2008, 
        dividends received from a captive real estate 
        investment trust, from
any such corporation specified 
        in clause (i) that would but for the provisions
of 
        Section 1504(b)(3) of the Internal Revenue Code be 
        treated as a member of
the affiliated group which 
        includes the dividend recipient, exceed the amount
of 
        the modification provided under subparagraph (G) of 
        paragraph (2) of this
subsection (b) which is related 
        to such dividends. This subparagraph (O) is exempt from 
        the provisions of Section 250 of this Act;
            (P) An amount equal to any contribution made to a 
        job training project
established pursuant to the Tax 
        Increment Allocation Redevelopment Act;
            (Q) An amount equal to the amount of the deduction 
        used to compute the
federal income tax credit for 
        restoration of substantial amounts held under
claim of 
        right for the taxable year pursuant to Section 1341 of 
        the
Internal Revenue Code;
            (R) On and after July 20, 1999, in the case of an 
        attorney-in-fact with respect to whom an
interinsurer 
        or a reciprocal insurer has made the election under 
        Section 835 of
the Internal Revenue Code, 26 U.S.C. 
        835, an amount equal to the excess, if
any, of the 
        amounts paid or incurred by that interinsurer or 
        reciprocal insurer
in the taxable year to the 
        attorney-in-fact over the deduction allowed to that

        interinsurer or reciprocal insurer with respect to the 
        attorney-in-fact under
Section 835(b) of the Internal 
        Revenue Code for the taxable year; the provisions of 
        this subparagraph are exempt from the provisions of 
        Section 250;
            (S) For taxable years ending on or after December 
        31, 1997, in the
case of a Subchapter
S corporation, an 
        amount equal to all amounts of income allocable to a

        shareholder subject to the Personal Property Tax 
        Replacement Income Tax imposed
by subsections (c) and 
        (d) of Section 201 of this Act, including amounts

        allocable to organizations exempt from federal income 
        tax by reason of Section
501(a) of the Internal Revenue 
        Code.  This subparagraph (S) is exempt from
the 
        provisions of Section 250;
            (T) For taxable years 2001 and thereafter, for the 
        taxable year in
which the bonus depreciation deduction

        is taken on the taxpayer's federal income tax return 
        under
subsection (k) of Section 168 of the Internal 
        Revenue Code and for each
applicable taxable year 
        thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation 
            deduction taken for the
taxable year
on the 
            taxpayer's federal income tax return on property 
            for which the bonus
depreciation deduction
was 
            taken in any year under subsection (k) of Section 
            168 of the Internal
Revenue Code, but not including 
            the bonus depreciation deduction;
                (2) for taxable years ending on or before 
            December 31, 2005, "x" equals "y" multiplied by 30 
            and then divided by 70 (or "y"
multiplied by 
            0.429); and
                (3) for taxable years ending after December 
            31, 2005:
                    (i) for property on which a bonus 
                depreciation deduction of 30% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                30 and then divided by 70 (or "y"
multiplied by 
                0.429); and
                    (ii) for property on which a bonus 
                depreciation deduction of 50% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                1.0.
            The aggregate amount deducted under this 
        subparagraph in all taxable
years for any one piece of 
        property may not exceed the amount of the bonus

        depreciation deduction
taken on that property on the 
        taxpayer's federal income tax return under
subsection 
        (k) of Section 168 of the Internal Revenue Code. This 
        subparagraph (T) is exempt from the provisions of 
        Section 250;
            (U) If the taxpayer sells, transfers, abandons, or 
        otherwise disposes of

property for which the taxpayer 
        was required in any taxable year to make an
addition 
        modification under subparagraph (E-10), then an amount 
        equal to that
addition modification.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was required in any taxable year to make an addition 
        modification under subparagraph (E-10), then an amount 
        equal to that addition modification.

            The taxpayer is allowed to take the deduction under 
        this subparagraph
only once with respect to any one 
        piece of property.
            This subparagraph (U) is exempt from the 
        provisions of Section 250;
            (V) The amount of: (i) any interest income (net of 
        the deductions allocable thereto) taken into account 
        for the taxable year with respect to a transaction with 
        a taxpayer that is required to make an addition 
        modification with respect to such transaction under 
        Section 203(a)(2)(D-17), 203(b)(2)(E-12), 
        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed 
        the amount of such addition modification,

(ii) any 
        income from intangible property (net of the deductions 
        allocable thereto) taken into account for the taxable 
        year with respect to a transaction with a taxpayer that 
        is required to make an addition modification with 
        respect to such transaction under Section 
        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 
        203(d)(2)(D-8), but not to exceed the amount of such 
        addition modification, and (iii) any insurance premium 
        income (net of deductions allocable thereto) taken 
        into account for the taxable year with respect to a 
        transaction with a taxpayer that is required to make an 
        addition modification with respect to such transaction 
        under Section 203(a)(2)(D-19), Section 
        203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section 
        203(d)(2)(D-9), but not to exceed the amount of that 
        addition modification. This subparagraph (V) is exempt 
        from the provisions of Section 250;

            (W) An amount equal to the interest income taken 
        into account for the taxable year (net of the 
        deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(b)(2)(E-12) for 
        interest paid, accrued, or incurred, directly or 
        indirectly, to the same person. This subparagraph (W) 
        is exempt from the provisions of Section 250;

            (X) An amount equal to the income from intangible 
        property taken into account for the taxable year (net 
        of the deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(b)(2)(E-13) for 
        intangible expenses and costs paid, accrued, or 
        incurred, directly or indirectly, to the same foreign 
        person. This subparagraph (X) is exempt from the 
        provisions of Section 250;

            (Y) For taxable years ending on or after December 
        31, 2011, in the case of a taxpayer who was required to 
        add back any insurance premiums under Section 
        203(b)(2)(E-14), such taxpayer may elect to subtract 
        that part of a reimbursement received from the 
        insurance company equal to the amount of the expense or 
        loss (including expenses incurred by the insurance 
        company) that would have been taken into account as a 
        deduction for federal income tax purposes if the 
        expense or loss had been uninsured. If a taxpayer makes 
        the election provided for by this subparagraph (Y), the 
        insurer to which the premiums were paid must add back 
        to income the amount subtracted by the taxpayer 
        pursuant to this subparagraph (Y).  This subparagraph 
        (Y) is exempt from the provisions of Section 250; and 
            (Z)  The difference between the nondeductible 
        controlled foreign corporation dividends under Section 
        965(e)(3) of the Internal Revenue Code over the taxable 
        income of the taxpayer, computed without regard to 
        Section 965(e)(2)(A) of the Internal Revenue Code, and 
        without regard to any net operating loss deduction. 
        This subparagraph (Z) is exempt from the provisions of 
        Section 250. 
        (3) Special rule.  For purposes of paragraph (2)(A), 
    "gross income"
in the case of a life insurance company, for 
    tax years ending on and after
December 31, 1994,
and prior 
    to December 31, 2011, shall mean the gross investment 
    income for the taxable year and, for tax years ending on or 
    after December 31, 2011, shall mean all amounts included in 
    life insurance gross income under Section 803(a)(3) of the 
    Internal Revenue Code.
 
    (c) Trusts and estates.
        (1) In general.  In the case of a trust or estate, base 
    income means
an amount equal to the taxpayer's taxable 
    income for the taxable year as
modified by paragraph (2).
        (2) Modifications.  Subject to the provisions of 
    paragraph (3), the
taxable income referred to in paragraph 
    (1) shall be modified by adding
thereto the sum of the 
    following amounts:
            (A) An amount equal to all amounts paid or accrued 
        to the taxpayer
as interest or dividends during the 
        taxable year to the extent excluded
from gross income 
        in the computation of taxable income;
            (B) In the case of (i) an estate, $600; (ii) a 
        trust which, under
its governing instrument, is 
        required to distribute all of its income
currently, 
        $300; and (iii) any other trust, $100, but in each such 
        case,
only to the extent such amount was deducted in 
        the computation of
taxable income;
            (C) An amount equal to the amount of tax imposed by 
        this Act to the
extent deducted from gross income in 
        the computation of taxable income
for the taxable year;
            (D) The amount of any net operating loss deduction 
        taken in arriving at
taxable income, other than a net 
        operating loss carried forward from a
taxable year 
        ending prior to December 31, 1986;
            (E) For taxable years in which a net operating loss 
        carryback or
carryforward from a taxable year ending 
        prior to December 31, 1986 is an
element of taxable 
        income under paragraph (1) of subsection (e) or 
        subparagraph
(E) of paragraph (2) of subsection (e), 
        the amount by which addition
modifications other than 
        those provided by this subparagraph (E) exceeded

        subtraction modifications in such taxable year, with 
        the following limitations
applied in the order that 
        they are listed:
                (i) the addition modification relating to the 
            net operating loss
carried back or forward to the 
            taxable year from any taxable year ending
prior to 
            December 31, 1986 shall be reduced by the amount of 
            addition
modification under this subparagraph (E) 
            which related to that net
operating loss and which 
            was taken into account in calculating the base

            income of an earlier taxable year, and
                (ii) the addition modification relating to the 
            net operating loss
carried back or forward to the 
            taxable year from any taxable year ending
prior to 
            December 31, 1986 shall not exceed the amount of 
            such carryback or
carryforward;
            For taxable years in which there is a net operating 
        loss carryback or
carryforward from more than one other 
        taxable year ending prior to December
31, 1986, the 
        addition modification provided in this subparagraph 
        (E) shall
be the sum of the amounts computed 
        independently under the preceding
provisions of this 
        subparagraph (E) for each such taxable year;
            (F) For taxable years ending on or after January 1, 
        1989, an amount
equal to the tax deducted pursuant to 
        Section 164 of the Internal Revenue
Code if the trust 
        or estate is claiming the same tax for purposes of the

        Illinois foreign tax credit under Section 601 of this 
        Act;
            (G) An amount equal to the amount of the capital 
        gain deduction
allowable under the Internal Revenue 
        Code, to the extent deducted from
gross income in the 
        computation of taxable income;
            (G-5) For taxable years ending after December 31, 
        1997, an
amount equal to any eligible remediation costs 
        that the trust or estate
deducted in computing adjusted 
        gross income and for which the trust
or estate claims a 
        credit under subsection (l) of Section 201;
            (G-10) For taxable years 2001 and thereafter, an 
        amount equal to the
bonus depreciation deduction taken 
        on the taxpayer's federal income tax return for the 
        taxable
year under subsection (k) of Section 168 of the 
        Internal Revenue Code; and
            (G-11) If the taxpayer sells, transfers, abandons, 
        or otherwise disposes of property for which the 
        taxpayer was required in any taxable year to
make an 
        addition modification under subparagraph (G-10), then 
        an amount equal
to the aggregate amount of the 
        deductions taken in all taxable
years under 
        subparagraph (R) with respect to that property.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was allowed in any taxable year to make a subtraction 
        modification under subparagraph (R), then an amount 
        equal to that subtraction modification.

            The taxpayer is required to make the addition 
        modification under this
subparagraph
only once with 
        respect to any one piece of property;
            (G-12) An amount equal to the amount otherwise 
        allowed as a deduction in computing base income for 
        interest paid, accrued, or incurred, directly or 
        indirectly, (i) for taxable years ending on or after 
        December 31, 2004, to a foreign person who would be a 
        member of the same unitary business group but for the 
        fact that the foreign person's business activity 
        outside the United States is 80% or more of the foreign 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304. The addition modification 
        required by this subparagraph shall be reduced to the 
        extent that dividends were included in base income of 
        the unitary group for the same taxable year and 
        received by the taxpayer or by a member of the 
        taxpayer's unitary business group (including amounts 
        included in gross income pursuant to Sections 951 
        through 964 of the Internal Revenue Code and amounts 
        included in gross income under Section 78 of the 
        Internal Revenue Code) with respect to the stock of the 
        same person to whom the interest was paid, accrued, or 
        incurred.

            This paragraph shall not apply to the following:

                (i) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person who 
            is subject in a foreign country or state, other 
            than a state which requires mandatory unitary 
            reporting, to a tax on or measured by net income 
            with respect to such interest; or
                (ii) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer can establish, based on a 
            preponderance of the evidence, both of the 
            following:
                    (a) the person, during the same taxable 
                year, paid, accrued, or incurred, the interest 
                to a person that is not a related member, and
                    (b) the transaction giving rise to the 
                interest expense between the taxpayer and the 
                person did not have as a principal purpose the 
                avoidance of Illinois income tax, and is paid 
                pursuant to a contract or agreement that 
                reflects an arm's-length interest rate and 
                terms; or

                (iii) the taxpayer can establish, based on 
            clear and convincing evidence, that the interest 
            paid, accrued, or incurred relates to a contract or 
            agreement entered into at arm's-length rates and 
            terms and the principal purpose for the payment is 
            not federal or Illinois tax avoidance; or

                (iv) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer establishes by clear and convincing 
            evidence that the adjustments are unreasonable; or 
            if the taxpayer and the Director agree in writing 
            to the application or use of an alternative method 
            of apportionment under Section 304(f).

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (G-13) An amount equal to the amount of intangible 
        expenses and costs otherwise allowed as a deduction in 
        computing base income, and that were paid, accrued, or 
        incurred, directly or indirectly, (i) for taxable 
        years ending on or after December 31, 2004, to a 
        foreign person who would be a member of the same 
        unitary business group but for the fact that the 
        foreign person's business activity outside the United 
        States is 80% or more of that person's total business 
        activity and (ii) for taxable years ending on or after 
        December 31, 2008, to a person who would be a member of 
        the same unitary business group but for the fact that 
        the person is prohibited under Section 1501(a)(27) 
        from being included in the unitary business group 
        because he or she is ordinarily required to apportion 
        business income under different subsections of Section 
        304. The addition modification required by this 
        subparagraph shall be reduced to the extent that 
        dividends were included in base income of the unitary 
        group for the same taxable year and received by the 
        taxpayer or by a member of the taxpayer's unitary 
        business group (including amounts included in gross 
        income pursuant to Sections 951 through 964 of the 
        Internal Revenue Code and amounts included in gross 
        income under Section 78 of the Internal Revenue Code) 
        with respect to the stock of the same person to whom 
        the intangible expenses and costs were directly or 
        indirectly paid, incurred, or accrued. The preceding 
        sentence shall not apply to the extent that the same 
        dividends caused a reduction to the addition 
        modification required under Section 203(c)(2)(G-12) of 
        this Act. As used in this subparagraph, the term 
        "intangible expenses and costs" includes: (1) 
        expenses, losses, and costs for or related to the 
        direct or indirect acquisition, use, maintenance or 
        management, ownership, sale, exchange, or any other 
        disposition of intangible property; (2) losses 
        incurred, directly or indirectly, from factoring 
        transactions or discounting transactions; (3) royalty, 
        patent, technical, and copyright fees; (4) licensing 
        fees; and (5) other similar expenses and costs. For 
        purposes of this subparagraph, "intangible property" 
        includes patents, patent applications, trade names, 
        trademarks, service marks, copyrights, mask works, 
        trade secrets, and similar types of intangible assets.
            This paragraph shall not apply to the following:
                (i)         any item of intangible expenses or costs 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person who is 
            subject in a foreign country or state, other than a 
            state which requires mandatory unitary reporting, 
            to a tax on or measured by net income with respect 
            to such item; or
                (ii)        any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, if the taxpayer can establish, based 
            on a preponderance of the evidence, both of the 
            following:
                    (a) the person during the same taxable 
                year paid, accrued, or incurred, the 
                intangible expense or cost to a person that is 
                not a related member, and
                    (b) the transaction giving rise to the 
                intangible expense or cost between the 
                taxpayer and the person did not have as a 
                principal purpose the avoidance of Illinois 
                income tax, and is paid pursuant to a contract 
                or agreement that reflects arm's-length terms; 
                or
                (iii)       any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person if the 
            taxpayer establishes by clear and convincing 
            evidence, that the adjustments are unreasonable; 
            or if the taxpayer and the Director agree in 
            writing to the application or use of an alternative 
            method of apportionment under Section 304(f);

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (G-14) For taxable years ending on or after 
        December 31, 2008, an amount equal to the amount of 
        insurance premium expenses and costs otherwise allowed 
        as a deduction in computing base income, and that were 
        paid, accrued, or incurred, directly or indirectly, to 
        a person who would be a member of the same unitary 
        business group but for the fact that the person is 
        prohibited under Section 1501(a)(27) from being 
        included in the unitary business group because he or 
        she is ordinarily required to apportion business 
        income under different subsections of Section 304.  The 
        addition modification required by this subparagraph 
        shall be reduced to the extent that dividends were 
        included in base income of the unitary group for the 
        same taxable year and received by the taxpayer or by a 
        member of the taxpayer's unitary business group 
        (including amounts included in gross income under 
        Sections 951 through 964 of the Internal Revenue Code 
        and amounts included in gross income under Section 78 
        of the Internal Revenue Code) with respect to the stock 
        of the same person to whom the premiums and costs were 
        directly or indirectly paid, incurred, or accrued. The 
        preceding sentence does not apply to the extent that 
        the same dividends caused a reduction to the addition 
        modification required under Section 203(c)(2)(G-12) or 
        Section 203(c)(2)(G-13) of this Act;
            (G-15)  An amount equal to the credit allowable to 
        the taxpayer under Section 218(a) of this Act, 
        determined without regard to Section 218(c) of this 
        Act;
            (G-16) For taxable years ending on or after 
        December 31, 2017, an amount equal to the deduction 
        allowed under Section 199 of the Internal Revenue Code 
        for the taxable year; 
    and by deducting from the total so obtained the sum of the 
    following
amounts:
            (H) An amount equal to all amounts included in such 
        total pursuant
to the provisions of Sections 402(a), 
        402(c), 403(a), 403(b), 406(a), 407(a)
and 408 of the 
        Internal Revenue Code or included in such total as

        distributions under the provisions of any retirement 
        or disability plan for
employees of any governmental 
        agency or unit, or retirement payments to
retired 
        partners, which payments are excluded in computing net 
        earnings
from self employment by Section 1402 of the 
        Internal Revenue Code and
regulations adopted pursuant 
        thereto;
            (I) The valuation limitation amount;
            (J) An amount equal to the amount of any tax 
        imposed by this Act
which was refunded to the taxpayer 
        and included in such total for the
taxable year;
            (K) An amount equal to all amounts included in 
        taxable income as
modified by subparagraphs (A), (B), 
        (C), (D), (E), (F) and (G) which
are exempt from 
        taxation by this State either by reason of its statutes 
        or
Constitution
or by reason of the Constitution, 
        treaties or statutes of the United States;
provided 
        that, in the case of any statute of this State that 
        exempts income
derived from bonds or other obligations 
        from the tax imposed under this Act,
the amount 
        exempted shall be the interest net of bond premium 
        amortization;
            (L) With the exception of any amounts subtracted 
        under subparagraph
(K),
an amount equal to the sum of 
        all amounts disallowed as
deductions by (i) Sections 
        171(a)(2) and 265(a)(2) of the Internal Revenue
Code, 
        and all amounts of expenses allocable
to interest and 
        disallowed as deductions by Section 265(a)(1) 265(1) 
        of the Internal
Revenue Code;
and (ii) for taxable 
        years
ending on or after August 13, 1999, Sections

        171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of the 
        Internal Revenue Code, plus, (iii) for taxable years 
        ending on or after December 31, 2011, Section 45G(e)(3) 
        of the Internal Revenue Code and, for taxable years 
        ending on or after December 31, 2008, any amount 
        included in gross income under Section 87 of the 
        Internal Revenue Code; the provisions of this

        subparagraph are exempt from the provisions of Section 
        250;
            (M) An amount equal to those dividends included in 
        such total
which were paid by a corporation which 
        conducts business operations in a River Edge 
        Redevelopment Zone or zones created under the River 
        Edge Redevelopment Zone Act and
conducts substantially 
        all of its operations in a River Edge Redevelopment 
        Zone or zones. This subparagraph (M) is exempt from the 
        provisions of Section 250;
            (N) An amount equal to any contribution made to a 
        job training
project established pursuant to the Tax 
        Increment Allocation
Redevelopment Act;
            (O) An amount equal to those dividends included in 
        such total
that were paid by a corporation that 
        conducts business operations in a
federally designated 
        Foreign Trade Zone or Sub-Zone and that is designated
a 
        High Impact Business located in Illinois; provided 
        that dividends eligible
for the deduction provided in 
        subparagraph (M) of paragraph (2) of this
subsection 
        shall not be eligible for the deduction provided under 
        this
subparagraph (O);
            (P) An amount equal to the amount of the deduction 
        used to compute the
federal income tax credit for 
        restoration of substantial amounts held under
claim of 
        right for the taxable year pursuant to Section 1341 of 
        the
Internal Revenue Code;
            (Q) For taxable year 1999 and thereafter, an amount 
        equal to the
amount of any
(i) distributions, to the 
        extent includible in gross income for
federal income 
        tax purposes, made to the taxpayer because of
his or 
        her status as a victim of
persecution for racial or 
        religious reasons by Nazi Germany or any other Axis

        regime or as an heir of the victim and (ii) items
of 
        income, to the extent
includible in gross income for 
        federal income tax purposes, attributable to,
derived 
        from or in any way related to assets stolen from, 
        hidden from, or
otherwise lost to a victim of

        persecution for racial or religious reasons by Nazi

        Germany or any other Axis regime
immediately prior to, 
        during, and immediately after World War II, including,

        but
not limited to, interest on the proceeds receivable 
        as insurance
under policies issued to a victim of 
        persecution for racial or religious
reasons by Nazi 
        Germany or any other Axis regime by European insurance

        companies
immediately prior to and during World War II;

        provided, however, this subtraction from federal 
        adjusted gross income does not
apply to assets acquired 
        with such assets or with the proceeds from the sale of

        such assets; provided, further, this paragraph shall 
        only apply to a taxpayer
who was the first recipient of 
        such assets after their recovery and who is a
victim of

        persecution for racial or religious reasons
by Nazi 
        Germany or any other Axis regime or as an heir of the 
        victim.  The
amount of and the eligibility for any 
        public assistance, benefit, or
similar entitlement is 
        not affected by the inclusion of items (i) and (ii) of

        this paragraph in gross income for federal income tax 
        purposes.
This paragraph is exempt from the provisions 
        of Section 250;
            (R) For taxable years 2001 and thereafter, for the 
        taxable year in
which the bonus depreciation deduction

        is taken on the taxpayer's federal income tax return 
        under
subsection (k) of Section 168 of the Internal 
        Revenue Code and for each
applicable taxable year 
        thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation 
            deduction taken for the
taxable year
on the 
            taxpayer's federal income tax return on property 
            for which the bonus
depreciation deduction
was 
            taken in any year under subsection (k) of Section 
            168 of the Internal
Revenue Code, but not including 
            the bonus depreciation deduction;
                (2) for taxable years ending on or before 
            December 31, 2005, "x" equals "y" multiplied by 30 
            and then divided by 70 (or "y"
multiplied by 
            0.429); and
                (3) for taxable years ending after December 
            31, 2005:
                    (i) for property on which a bonus 
                depreciation deduction of 30% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                30 and then divided by 70 (or "y"
multiplied by 
                0.429); and
                    (ii) for property on which a bonus 
                depreciation deduction of 50% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                1.0.
            The aggregate amount deducted under this 
        subparagraph in all taxable
years for any one piece of 
        property may not exceed the amount of the bonus

        depreciation deduction
taken on that property on the 
        taxpayer's federal income tax return under
subsection 
        (k) of Section 168 of the Internal Revenue Code. This 
        subparagraph (R) is exempt from the provisions of 
        Section 250;
            (S) If the taxpayer sells, transfers, abandons, or 
        otherwise disposes of

property for which the taxpayer 
        was required in any taxable year to make an
addition 
        modification under subparagraph (G-10), then an amount 
        equal to that
addition modification.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was required in any taxable year to make an addition 
        modification under subparagraph (G-10), then an amount 
        equal to that addition modification.

            The taxpayer is allowed to take the deduction under 
        this subparagraph
only once with respect to any one 
        piece of property.
            This subparagraph (S) is exempt from the 
        provisions of Section 250;
            (T) The amount of (i) any interest income (net of 
        the deductions allocable thereto) taken into account 
        for the taxable year with respect to a transaction with 
        a taxpayer that is required to make an addition 
        modification with respect to such transaction under 
        Section 203(a)(2)(D-17), 203(b)(2)(E-12), 
        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed 
        the amount of such addition modification and

(ii) any 
        income from intangible property (net of the deductions 
        allocable thereto) taken into account for the taxable 
        year with respect to a transaction with a taxpayer that 
        is required to make an addition modification with 
        respect to such transaction under Section 
        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 
        203(d)(2)(D-8), but not to exceed the amount of such 
        addition modification. This subparagraph (T) is exempt 
        from the provisions of Section 250;

            (U) An amount equal to the interest income taken 
        into account for the taxable year (net of the 
        deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(c)(2)(G-12) for 
        interest paid, accrued, or incurred, directly or 
        indirectly, to the same person. This subparagraph (U) 
        is exempt from the provisions of Section 250; 
            (V) An amount equal to the income from intangible 
        property taken into account for the taxable year (net 
        of the deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(c)(2)(G-13) for 
        intangible expenses and costs paid, accrued, or 
        incurred, directly or indirectly, to the same foreign 
        person. This subparagraph (V) is exempt from the 
        provisions of Section 250;

            (W)  in the case of an estate, an amount equal to 
        all amounts included in such total pursuant to the 
        provisions of Section 111 of the  Internal Revenue Code 
        as a recovery of items previously deducted by the 
        decedent from adjusted gross income in the computation 
        of taxable income.  This subparagraph (W) is exempt from 
        Section 250; 
            (X) an amount equal to the refund included in such 
        total of any tax deducted for federal income tax 
        purposes, to the extent that deduction was added back 
        under subparagraph (F). This subparagraph (X) is 
        exempt from the provisions of Section 250; and
            (Y) For taxable years ending on or after December 
        31, 2011, in the case of a taxpayer who was required to 
        add back any insurance premiums under Section 
        203(c)(2)(G-14), such taxpayer may elect to subtract 
        that part of a reimbursement received from the 
        insurance company equal to the amount of the expense or 
        loss (including expenses incurred by the insurance 
        company) that would have been taken into account as a 
        deduction for federal income tax purposes if the 
        expense or loss had been uninsured. If a taxpayer makes 
        the election provided for by this subparagraph (Y), the 
        insurer to which the premiums were paid must add back 
        to income the amount subtracted by the taxpayer 
        pursuant to this subparagraph (Y).  This subparagraph 
        (Y) is exempt from the provisions of Section 250; and .
            (Z) For taxable years beginning after December 31, 
        2018 and before January 1, 2026, the amount of excess 
        business loss of the taxpayer disallowed as a deduction 
        by Section 461(l)(1)(B) of the Internal Revenue Code. 
        (3) Limitation.  The amount of any modification 
    otherwise required
under this subsection shall, under 
    regulations prescribed by the
Department, be adjusted by 
    any amounts included therein which were
properly paid, 
    credited, or required to be distributed, or permanently set

    aside for charitable purposes pursuant  to Internal Revenue 
    Code Section
642(c) during the taxable year.
 
    (d) Partnerships.
        (1) In general. In the case of a partnership, base 
    income means an
amount equal to the taxpayer's taxable 
    income for the taxable year as
modified by paragraph (2).
        (2) Modifications. The taxable income referred to in 
    paragraph (1)
shall be modified by adding thereto the sum 
    of the following amounts:
            (A) An amount equal to all amounts paid or accrued 
        to the taxpayer as
interest or dividends during the 
        taxable year to the extent excluded from
gross income 
        in the computation of taxable income;
            (B) An amount equal to the amount of tax imposed by 
        this Act to the
extent deducted from gross income for 
        the taxable year;
            (C) The amount of deductions allowed to the 
        partnership pursuant to
Section 707 (c) of the Internal 
        Revenue Code in calculating its taxable income;
            (D) An amount equal to the amount of the capital 
        gain deduction
allowable under the Internal Revenue 
        Code, to the extent deducted from
gross income in the 
        computation of taxable income;
            (D-5) For taxable years 2001 and thereafter, an 
        amount equal to the
bonus depreciation deduction taken 
        on the taxpayer's federal income tax return for the 
        taxable
year under subsection (k) of Section 168 of the 
        Internal Revenue Code;
            (D-6) If the taxpayer sells, transfers, abandons, 
        or otherwise disposes of

property for which the 
        taxpayer was required in any taxable year to make an

        addition modification under subparagraph (D-5), then 
        an amount equal to the
aggregate amount of the 
        deductions taken in all taxable years
under 
        subparagraph (O) with respect to that property.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was allowed in any taxable year to make a subtraction 
        modification under subparagraph (O), then an amount 
        equal to that subtraction modification.

            The taxpayer is required to make the addition 
        modification under this
subparagraph
only once with 
        respect to any one piece of property;
            (D-7) An amount equal to the amount otherwise 
        allowed as a deduction in computing base income for 
        interest paid, accrued, or incurred, directly or 
        indirectly, (i) for taxable years ending on or after 
        December 31, 2004, to a foreign person who would be a 
        member of the same unitary business group but for the 
        fact the foreign person's business activity outside 
        the United States is 80% or more of the foreign 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304. The addition modification 
        required by this subparagraph shall be reduced to the 
        extent that dividends were included in base income of 
        the unitary group for the same taxable year and 
        received by the taxpayer or by a member of the 
        taxpayer's unitary business group (including amounts 
        included in gross income pursuant to Sections 951 
        through 964 of the Internal Revenue Code and amounts 
        included in gross income under Section 78 of the 
        Internal Revenue Code) with respect to the stock of the 
        same person to whom the interest was paid, accrued, or 
        incurred.

            This paragraph shall not apply to the following:

                (i) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person who 
            is subject in a foreign country or state, other 
            than a state which requires mandatory unitary 
            reporting, to a tax on or measured by net income 
            with respect to such interest; or
                (ii) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer can establish, based on a 
            preponderance of the evidence, both of the 
            following:
                    (a) the person, during the same taxable 
                year, paid, accrued, or incurred, the interest 
                to a person that is not a related member, and
                    (b) the transaction giving rise to the 
                interest expense between the taxpayer and the 
                person did not have as a principal purpose the 
                avoidance of Illinois income tax, and is paid 
                pursuant to a contract or agreement that 
                reflects an arm's-length interest rate and 
                terms; or

                (iii) the taxpayer can establish, based on 
            clear and convincing evidence, that the interest 
            paid, accrued, or incurred relates to a contract or 
            agreement entered into at arm's-length rates and 
            terms and the principal purpose for the payment is 
            not federal or Illinois tax avoidance; or

                (iv) an item of interest paid, accrued, or 
            incurred, directly or indirectly, to a person if 
            the taxpayer establishes by clear and convincing 
            evidence that the adjustments are unreasonable; or 
            if the taxpayer and the Director agree in writing 
            to the application or use of an alternative method 
            of apportionment under Section 304(f).

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act; and

            (D-8) An amount equal to the amount of intangible 
        expenses and costs otherwise allowed as a deduction in 
        computing base income, and that were paid, accrued, or 
        incurred, directly or indirectly, (i) for taxable 
        years ending on or after December 31, 2004, to a 
        foreign person who would be a member of the same 
        unitary business group but for the fact that the 
        foreign person's business activity outside the United 
        States is 80% or more of that person's total business 
        activity and (ii) for taxable years ending on or after 
        December 31, 2008, to a person who would be a member of 
        the same unitary business group but for the fact that 
        the person is prohibited under Section 1501(a)(27) 
        from being included in the unitary business group 
        because he or she is ordinarily required to apportion 
        business income under different subsections of Section 
        304. The addition modification required by this 
        subparagraph shall be reduced to the extent that 
        dividends were included in base income of the unitary 
        group for the same taxable year and received by the 
        taxpayer or by a member of the taxpayer's unitary 
        business group (including amounts included in gross 
        income pursuant to Sections 951 through 964 of the 
        Internal Revenue Code and amounts included in gross 
        income under Section 78 of the Internal Revenue Code) 
        with respect to the stock of the same person to whom 
        the intangible expenses and costs were directly or 
        indirectly paid, incurred or accrued. The preceding 
        sentence shall not apply to the extent that the same 
        dividends caused a reduction to the addition 
        modification required under Section 203(d)(2)(D-7) of 
        this Act. As used in this subparagraph, the term 
        "intangible expenses and costs" includes (1) expenses, 
        losses, and costs for, or related to, the direct or 
        indirect acquisition, use, maintenance or management, 
        ownership, sale, exchange, or any other disposition of 
        intangible property; (2) losses incurred, directly or 
        indirectly, from factoring transactions or discounting 
        transactions; (3) royalty, patent, technical, and 
        copyright fees; (4) licensing fees; and (5) other 
        similar expenses and costs. For purposes of this 
        subparagraph, "intangible property" includes patents, 
        patent applications, trade names, trademarks, service 
        marks, copyrights, mask works, trade secrets, and 
        similar types of intangible assets;
            This paragraph shall not apply to the following:
                (i)         any item of intangible expenses or costs 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person who is 
            subject in a foreign country or state, other than a 
            state which requires mandatory unitary reporting, 
            to a tax on or measured by net income with respect 
            to such item; or
                (ii)        any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, if the taxpayer can establish, based 
            on a preponderance of the evidence, both of the 
            following:
                    (a) the person during the same taxable 
                year paid, accrued, or incurred, the 
                intangible expense or cost to a person that is 
                not a related member, and
                    (b) the transaction giving rise to the 
                intangible expense or cost between the 
                taxpayer and the person did not have as a 
                principal purpose the avoidance of Illinois 
                income tax, and is paid pursuant to a contract 
                or agreement that reflects arm's-length terms; 
                or
                (iii)       any item of intangible expense or cost 
            paid, accrued, or incurred, directly or 
            indirectly, from a transaction with a person if the 
            taxpayer establishes by clear and convincing 
            evidence, that the adjustments are unreasonable; 
            or if the taxpayer and the Director agree in 
            writing to the application or use of an alternative 
            method of apportionment under Section 304(f);

                Nothing in this subsection shall preclude the 
            Director from making any other adjustment 
            otherwise allowed under Section 404 of this Act for 
            any tax year beginning after the effective date of 
            this amendment provided such adjustment is made 
            pursuant to regulation adopted by the Department 
            and such regulations provide methods and standards 
            by which the Department will utilize its authority 
            under Section 404 of this Act;

            (D-9) For taxable years ending on or after December 
        31, 2008, an amount equal to the amount of insurance 
        premium expenses and costs otherwise allowed as a 
        deduction in computing base income, and that were paid, 
        accrued, or incurred, directly or indirectly, to a 
        person who would be a member of the same unitary 
        business group but for the fact that the person is 
        prohibited under Section 1501(a)(27) from being 
        included in the unitary business group because he or 
        she is ordinarily required to apportion business 
        income under different subsections of Section 304.  The 
        addition modification required by this subparagraph 
        shall be reduced to the extent that dividends were 
        included in base income of the unitary group for the 
        same taxable year and received by the taxpayer or by a 
        member of the taxpayer's unitary business group 
        (including amounts included in gross income under 
        Sections 951 through 964 of the Internal Revenue Code 
        and amounts included in gross income under Section 78 
        of the Internal Revenue Code) with respect to the stock 
        of the same person to whom the premiums and costs were 
        directly or indirectly paid, incurred, or accrued. The 
        preceding sentence does not apply to the extent that 
        the same dividends caused a reduction to the addition 
        modification required under Section 203(d)(2)(D-7) or 
        Section 203(d)(2)(D-8) of this Act;
            (D-10) An amount equal to the credit allowable to 
        the taxpayer under Section 218(a) of this Act, 
        determined without regard to Section 218(c) of this 
        Act;
            (D-11) For taxable years ending on or after 
        December 31, 2017, an amount equal to the deduction 
        allowed under Section 199 of the Internal Revenue Code 
        for the taxable year; 
    and by deducting from the total so obtained the following 
    amounts:
            (E) The valuation limitation amount;
            (F) An amount equal to the amount of any tax 
        imposed by this Act which
was refunded to the taxpayer 
        and included in such total for the taxable year;
            (G) An amount equal to all amounts included in 
        taxable income as
modified by subparagraphs (A), (B), 
        (C) and (D) which are exempt from
taxation by this 
        State either by reason of its statutes or Constitution 
        or
by reason of
the Constitution, treaties or statutes 
        of the United States;
provided that, in the case of any 
        statute of this State that exempts income
derived from 
        bonds or other obligations from the tax imposed under 
        this Act,
the amount exempted shall be the interest net 
        of bond premium amortization;
            (H) Any income of the partnership which 
        constitutes personal service
income as defined in 
        Section 1348(b)(1) of the Internal Revenue Code (as
in 
        effect December 31, 1981) or a reasonable allowance for 
        compensation
paid or accrued for services rendered by 
        partners to the partnership,
whichever is greater; 
        this subparagraph (H) is exempt from the provisions of 
        Section 250;
            (I) An amount equal to all amounts of income 
        distributable to an entity
subject to the Personal 
        Property Tax Replacement Income Tax imposed by

        subsections (c) and (d) of Section 201 of this Act 
        including amounts
distributable to organizations 
        exempt from federal income tax by reason of
Section 
        501(a) of the Internal Revenue Code; this subparagraph 
        (I) is exempt from the provisions of Section 250;
            (J) With the exception of any amounts subtracted 
        under subparagraph
(G),
an amount equal to the sum of 
        all amounts disallowed as deductions
by (i) Sections 
        171(a)(2), and 265(a)(2) 265(2) of the Internal 
        Revenue Code, and all amounts of expenses allocable to

        interest and disallowed as deductions by Section 
        265(a)(1) 265(1) of the Internal
Revenue Code;
and (ii) 
        for taxable years
ending on or after August 13, 1999, 
        Sections
171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of 
        the Internal Revenue Code, plus, (iii) for taxable 
        years ending on or after December 31, 2011, Section 
        45G(e)(3) of the Internal Revenue Code and, for taxable 
        years ending on or after December 31, 2008, any amount 
        included in gross income under Section 87 of the 
        Internal Revenue Code; the provisions of this

        subparagraph are exempt from the provisions of Section 
        250;
            (K) An amount equal to those dividends included in 
        such total which were
paid by a corporation which 
        conducts business operations in a River Edge 
        Redevelopment Zone or zones created under the River 
        Edge Redevelopment Zone Act and
conducts substantially 
        all of its operations
 from a River Edge Redevelopment 
        Zone or zones.  This subparagraph (K) is exempt from the 
        provisions of Section 250;
            (L) An amount equal to any contribution made to a 
        job training project
established pursuant to the Real 
        Property Tax Increment Allocation
Redevelopment Act;
            (M) An amount equal to those dividends included in 
        such total
that were paid by a corporation that 
        conducts business operations in a
federally designated 
        Foreign Trade Zone or Sub-Zone and that is designated a

        High Impact Business located in Illinois; provided 
        that dividends eligible
for the deduction provided in 
        subparagraph (K) of paragraph (2) of this
subsection 
        shall not be eligible for the deduction provided under 
        this
subparagraph (M);
            (N) An amount equal to the amount of the deduction 
        used to compute the
federal income tax credit for 
        restoration of substantial amounts held under
claim of 
        right for the taxable year pursuant to Section 1341 of 
        the
Internal Revenue Code;
            (O) For taxable years 2001 and thereafter, for the 
        taxable year in
which the bonus depreciation deduction

        is taken on the taxpayer's federal income tax return 
        under
subsection (k) of Section 168 of the Internal 
        Revenue Code and for each
applicable taxable year 
        thereafter, an amount equal to "x", where:
                (1) "y" equals the amount of the depreciation 
            deduction taken for the
taxable year
on the 
            taxpayer's federal income tax return on property 
            for which the bonus
depreciation deduction
was 
            taken in any year under subsection (k) of Section 
            168 of the Internal
Revenue Code, but not including 
            the bonus depreciation deduction;
                (2) for taxable years ending on or before 
            December 31, 2005, "x" equals "y" multiplied by 30 
            and then divided by 70 (or "y"
multiplied by 
            0.429); and
                (3) for taxable years ending after December 
            31, 2005:
                    (i) for property on which a bonus 
                depreciation deduction of 30% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                30 and then divided by 70 (or "y"
multiplied by 
                0.429); and
                    (ii) for property on which a bonus 
                depreciation deduction of 50% of the adjusted 
                basis was taken, "x" equals "y" multiplied by 
                1.0.
            The aggregate amount deducted under this 
        subparagraph in all taxable
years for any one piece of 
        property may not exceed the amount of the bonus

        depreciation deduction
taken on that property on the 
        taxpayer's federal income tax return under
subsection 
        (k) of Section 168 of the Internal Revenue Code. This 
        subparagraph (O) is exempt from the provisions of 
        Section 250;
            (P) If the taxpayer sells, transfers, abandons, or 
        otherwise disposes of

property for which the taxpayer 
        was required in any taxable year to make an
addition 
        modification under subparagraph (D-5), then an amount 
        equal to that
addition modification.
            If the taxpayer continues to own property through 
        the last day of the last tax year for which the 
        taxpayer may claim a depreciation deduction for 
        federal income tax purposes and for which the taxpayer 
        was required in any taxable year to make an addition 
        modification under subparagraph (D-5), then an amount 
        equal to that addition modification.

            The taxpayer is allowed to take the deduction under 
        this subparagraph
only once with respect to any one 
        piece of property.
            This subparagraph (P) is exempt from the 
        provisions of Section 250;
            (Q) The amount of (i) any interest income (net of 
        the deductions allocable thereto) taken into account 
        for the taxable year with respect to a transaction with 
        a taxpayer that is required to make an addition 
        modification with respect to such transaction under 
        Section 203(a)(2)(D-17), 203(b)(2)(E-12), 
        203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed 
        the amount of such addition modification and

(ii) any 
        income from intangible property (net of the deductions 
        allocable thereto) taken into account for the taxable 
        year with respect to a transaction with a taxpayer that 
        is required to make an addition modification with 
        respect to such transaction under Section 
        203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or 
        203(d)(2)(D-8), but not to exceed the amount of such 
        addition modification. This subparagraph (Q) is exempt 
        from Section 250;

            (R) An amount equal to the interest income taken 
        into account for the taxable year (net of the 
        deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(d)(2)(D-7) for interest 
        paid, accrued, or incurred, directly or indirectly, to 
        the same person. This subparagraph (R) is exempt from 
        Section 250; 
            (S) An amount equal to the income from intangible 
        property taken into account for the taxable year (net 
        of the deductions allocable thereto) with respect to 
        transactions with (i) a foreign person who would be a 
        member of the taxpayer's unitary business group but for 
        the fact that the foreign person's business activity 
        outside the United States is 80% or more of that 
        person's total business activity and (ii) for taxable 
        years ending on or after December 31, 2008, to a person 
        who would be a member of the same unitary business 
        group but for the fact that the person is prohibited 
        under Section 1501(a)(27) from being included in the 
        unitary business group because he or she is ordinarily 
        required to apportion business income under different 
        subsections of Section 304, but not to exceed the 
        addition modification required to be made for the same 
        taxable year under Section 203(d)(2)(D-8) for 
        intangible expenses and costs paid, accrued, or 
        incurred, directly or indirectly, to the same person. 
        This subparagraph (S) is exempt from Section 250; and

            (T)  For taxable years ending on or after December 
        31, 2011, in the case of a taxpayer who was required to 
        add back any insurance premiums under Section 
        203(d)(2)(D-9), such taxpayer may elect to subtract 
        that part of a reimbursement received from the 
        insurance company equal to the amount of the expense or 
        loss (including expenses incurred by the insurance 
        company) that would have been taken into account as a 
        deduction for federal income tax purposes if the 
        expense or loss had been uninsured. If a taxpayer makes 
        the election provided for by this subparagraph (T), the 
        insurer to which the premiums were paid must add back 
        to income the amount subtracted by the taxpayer 
        pursuant to this subparagraph (T).  This subparagraph 
        (T) is exempt from the provisions of Section 250. 
 
    (e) Gross income; adjusted gross income; taxable income.
        (1) In general.  Subject to the provisions of paragraph 
    (2) and
subsection (b)(3), for purposes of this Section and 
    Section 803(e), a
taxpayer's gross income, adjusted gross 
    income, or taxable income for
the taxable year shall mean 
    the amount of gross income, adjusted gross
income or 
    taxable income properly reportable for federal income tax

    purposes for the taxable year under the provisions of the 
    Internal
Revenue Code. Taxable income may be less than 
    zero. However, for taxable
years ending on or after 
    December 31, 1986, net operating loss
carryforwards from 
    taxable years ending prior to December 31, 1986, may not

    exceed the sum of federal taxable income for the taxable 
    year before net
operating loss deduction, plus the excess 
    of addition modifications over
subtraction modifications 
    for the taxable year.  For taxable years ending
prior to 
    December 31, 1986, taxable income may never be an amount in 
    excess
of the net operating loss for the taxable year as 
    defined in subsections
(c) and (d) of Section 172 of the 
    Internal Revenue Code, provided that when
taxable income of 
    a corporation (other than a Subchapter S corporation),

    trust, or estate is less than zero and addition 
    modifications, other than
those provided by subparagraph 
    (E) of paragraph (2) of subsection (b) for
corporations or 
    subparagraph (E) of paragraph (2) of subsection (c) for

    trusts and estates, exceed subtraction modifications, an 
    addition
modification must be made under those 
    subparagraphs for any other taxable
year to which the 
    taxable income less than zero (net operating loss) is

    applied under Section 172 of the Internal Revenue Code or 
    under
subparagraph (E) of paragraph (2) of this subsection 
    (e) applied in
conjunction with Section 172 of the Internal 
    Revenue Code.
        (2) Special rule.  For purposes of paragraph (1) of this 
    subsection,
the taxable income properly reportable for 
    federal income tax purposes
shall mean:
            (A) Certain life insurance companies.  In the case 
        of a life
insurance company subject to the tax imposed 
        by Section 801 of the
Internal Revenue Code, life 
        insurance company taxable income, plus the
amount of 
        distribution from pre-1984 policyholder surplus 
        accounts as
calculated under Section 815a of the 
        Internal Revenue Code;
            (B) Certain other insurance companies.  In the case 
        of mutual
insurance companies subject to the tax 
        imposed by Section 831 of the
Internal Revenue Code, 
        insurance company taxable income;
            (C) Regulated investment companies.  In the case of 
        a regulated
investment company subject to the tax 
        imposed by Section 852 of the
Internal Revenue Code, 
        investment company taxable income;
            (D) Real estate investment trusts.  In the case of a 
        real estate
investment trust subject to the tax imposed 
        by Section 857 of the
Internal Revenue Code, real 
        estate investment trust taxable income;
            (E) Consolidated corporations.  In the case of a 
        corporation which
is a member of an affiliated group of 
        corporations filing a consolidated
income tax return 
        for the taxable year for federal income tax purposes,

        taxable income determined as if such corporation had 
        filed a separate
return for federal income tax purposes 
        for the taxable year and each
preceding taxable year 
        for which it was a member of an affiliated group.
For 
        purposes of this subparagraph, the taxpayer's separate 
        taxable
income shall be determined as if the election 
        provided by Section
243(b)(2) of the Internal Revenue 
        Code had been in effect for all such years;
            (F) Cooperatives.  In the case of a cooperative 
        corporation or
association, the taxable income of such 
        organization determined in
accordance with the 
        provisions of Section 1381 through 1388 of the
Internal 
        Revenue Code, but without regard to the prohibition 
        against offsetting losses from patronage activities 
        against income from nonpatronage activities; except 
        that a cooperative corporation or association may make 
        an election to follow its federal income tax treatment 
        of patronage losses and  nonpatronage losses.  In the 
        event such election is made, such losses shall be 
        computed and carried over in a manner consistent with 
        subsection (a) of Section 207 of this Act and 
        apportioned by the apportionment factor reported by 
        the cooperative on its Illinois income tax return filed 
        for the taxable year in which the losses are incurred.  
        The election shall be effective for all taxable years 
        with original returns due on or after the date of the 
        election.  In addition, the cooperative may file an 
        amended return or returns, as allowed under this Act, 
        to provide that the election shall be effective for 
        losses incurred or carried forward for taxable years 
        occurring prior to the date of the election.  Once made, 
        the election may only be revoked upon approval of the 
        Director.  The Department shall adopt rules setting 
        forth requirements for documenting the elections and 
        any resulting Illinois net loss and the standards to be 
        used by the Director in evaluating requests to revoke 
        elections.  Public Act 96-932  is declaratory of 
        existing law; 
            (G) Subchapter S corporations.  In the case of: (i) 
        a Subchapter S
corporation for which there is in effect 
        an election for the taxable year
under Section 1362 of 
        the Internal Revenue Code, the taxable income of such

        corporation determined in accordance with Section 
        1363(b) of the Internal
Revenue Code, except that 
        taxable income shall take into
account those items 
        which are required by Section 1363(b)(1) of the

        Internal Revenue Code to be separately stated; and (ii) 
        a Subchapter
S corporation for which there is in effect 
        a federal election to opt out of
the provisions of the 
        Subchapter S Revision Act of 1982 and have applied

        instead the prior federal Subchapter S rules as in 
        effect on July 1, 1982,
the taxable income of such 
        corporation determined in accordance with the
federal 
        Subchapter S rules as in effect on July 1, 1982; and
            (H) Partnerships.  In the case of a partnership, 
        taxable income
determined in accordance with Section 
        703 of the Internal Revenue Code,
except that taxable 
        income shall take into account those items which are

        required by Section 703(a)(1) to be separately stated 
        but which would be
taken into account by an individual 
        in calculating his taxable income.
        (3) Recapture of business expenses on disposition of 
    asset or business. Notwithstanding any other law to the 
    contrary, if in prior years income from an asset or 
    business has been classified as business income and in a 
    later year is demonstrated to be non-business income, then 
    all expenses, without limitation, deducted in such later 
    year and in the 2 immediately preceding taxable years 
    related to that asset or business that generated the 
    non-business income shall be added back and recaptured as 
    business income in the year of the disposition of the asset 
    or business. Such amount shall be apportioned to Illinois 
    using the greater of the apportionment fraction computed 
    for the business under Section 304 of this Act for the 
    taxable year or the average of the apportionment fractions 
    computed for the business under Section 304 of this Act for 
    the taxable year and for the 2 immediately preceding 
    taxable years.

 
    (f) Valuation limitation amount.
        (1) In general.  The valuation limitation amount 
    referred to in
subsections (a)(2)(G), (c)(2)(I) and 
    (d)(2)(E) is an amount equal to:
            (A) The sum of the pre-August 1, 1969 appreciation 
        amounts (to the
extent consisting of gain reportable 
        under the provisions of Section
1245 or 1250 of the 
        Internal Revenue Code) for all property in respect
of 
        which such gain was reported for the taxable year; plus
            (B) The lesser of (i) the sum of the pre-August 1, 
        1969 appreciation
amounts (to the extent consisting of 
        capital gain) for all property in
respect of which such 
        gain was reported for federal income tax purposes
for 
        the taxable year, or (ii) the net capital gain for the 
        taxable year,
reduced in either case by any amount of 
        such gain included in the amount
determined under 
        subsection (a)(2)(F) or (c)(2)(H).
        (2) Pre-August 1, 1969 appreciation amount.
            (A) If the fair market value of property referred 
        to in paragraph
(1) was readily ascertainable on August 
        1, 1969, the pre-August 1, 1969
appreciation amount for 
        such property is the lesser of (i) the excess of
such 
        fair market value over the taxpayer's basis (for 
        determining gain)
for such property on that date 
        (determined under the Internal Revenue
Code as in 
        effect on that date), or (ii) the total gain realized 
        and
reportable for federal income tax purposes in 
        respect of the sale,
exchange or other disposition of 
        such property.
            (B) If the fair market value of property referred 
        to in paragraph
(1) was not readily ascertainable on 
        August 1, 1969, the pre-August 1,
1969 appreciation 
        amount for such property is that amount which bears
the 
        same ratio to the total gain reported in respect of the 
        property for
federal income tax purposes for the 
        taxable year, as the number of full
calendar months in 
        that part of the taxpayer's holding period for the

        property ending July 31, 1969 bears to the number of 
        full calendar
months in the taxpayer's entire holding 
        period for the
property.
            (C) The Department shall prescribe such 
        regulations as may be
necessary to carry out the 
        purposes of this paragraph.
 
    (g) Double deductions.  Unless specifically provided 
otherwise, nothing
in this Section shall permit the same item 
to be deducted more than once.
 
    (h) Legislative intention.  Except as expressly provided by 
this
Section there shall be no modifications or limitations on 
the amounts
of income, gain, loss or deduction taken into 
account in determining
gross income, adjusted gross income or 
taxable income for federal income
tax purposes for the taxable 
year, or in the amount of such items
entering into the 
computation of base income and net income under this
Act for 
such taxable year, whether in respect of property values as of

August 1, 1969 or otherwise.
(Source: P.A. 100-22, eff. 7-6-17; 100-905, eff. 8-17-18; 
revised 10-29-18.)
 
    Section 10-10. The Use Tax Act is amended  by changing 
Section 2 and  by adding Section 2d as follows:
 


    (35 ILCS 105/2)  (from Ch. 120, par. 439.2)



    Sec. 2. Definitions.
    "Use" means the exercise by any person of any right or 
power over
tangible personal property incident to the ownership 
of that property,
except that it does not include the sale of 
such property in any form as
tangible personal property in the 
regular course of business to the extent
that such property is 
not first subjected to a use for which it was
purchased, and 
does not include the use of such property by its owner for

demonstration purposes: Provided that the property purchased 
is deemed to
be purchased for the purpose of resale, despite 
first being used, to the
extent to which it is resold as an 
ingredient of an intentionally produced
product or by-product 
of manufacturing.  "Use" does not mean the demonstration
use or 
interim use of tangible personal property by a retailer before 
he sells
that tangible personal property.  For watercraft or 
aircraft, if the period of
demonstration use or interim use by 
the retailer exceeds 18 months,
the retailer
shall pay on the 
retailers' original cost price the tax imposed by this Act,
and 
no credit for that tax is permitted if the watercraft or 
aircraft is
subsequently sold by the retailer.  "Use" does not 
mean the physical
incorporation of tangible personal property, 
to the extent not first subjected
to a use for which it was 
purchased, as an ingredient or constituent, into
other tangible 
personal property (a) which is sold in the regular course of

business or (b) which the person incorporating such ingredient 
or constituent
therein has undertaken at the time of such 
purchase to cause to be transported
in interstate commerce to 
destinations outside the State of Illinois: Provided
that the 
property purchased is deemed to be purchased for the purpose of

resale, despite first being used, to the extent to which it is 
resold as an
ingredient of an intentionally produced product or 
by-product of manufacturing.

    "Watercraft" means a Class 2, Class 3, or Class 4 
watercraft as defined in
Section 3-2 of the Boat Registration 
and Safety Act, a personal watercraft, or
any boat equipped 
with an inboard motor.

    "Purchase at retail" means the acquisition of the ownership 
of or title
to tangible personal property through a sale at 
retail.

    "Purchaser" means anyone who, through a sale at retail, 
acquires the
ownership of tangible personal property for a 
valuable consideration.

    "Sale at retail" means any transfer of the ownership of or 
title to
tangible personal property to a purchaser, for the 
purpose of use, and not
for the purpose of resale in any form 
as tangible personal property to the
extent not first subjected 
to a use for which it was purchased, for a
valuable 
consideration: Provided that the property purchased is deemed 
to
be purchased for the purpose of resale, despite first being 
used, to the
extent to which it is resold as an ingredient of 
an intentionally produced
product or by-product of 
manufacturing.  For this purpose, slag produced as
an incident 
to manufacturing pig iron or steel and sold is considered to be

an intentionally produced by-product of manufacturing.  "Sale 
at retail"
includes any such transfer made for resale unless 
made in compliance with
Section 2c of the Retailers' Occupation 
Tax Act, as incorporated by
reference into Section 12 of this 
Act.  Transactions whereby the possession
of the property is 
transferred but the seller retains the title as security
for 
payment of the selling price are sales.

    "Sale at retail" shall also be construed to include any 
Illinois
florist's sales transaction in which the purchase 
order is received in
Illinois by a florist and the sale is for 
use or consumption, but the
Illinois florist has a florist in 
another state deliver the property to the
purchaser or the 
purchaser's donee in such other state.

    Nonreusable tangible personal property that is used by 
persons engaged in
the business of operating a restaurant, 
cafeteria, or drive-in is a sale for
resale when it is 
transferred to customers in the ordinary course of business
as 
part of the sale of food or beverages and is used to deliver, 
package, or
consume food or beverages, regardless of where 
consumption of the food or
beverages occurs.  Examples of those 
items include, but are not limited to
nonreusable, paper and 
plastic cups, plates, baskets, boxes, sleeves, buckets
or other 
containers, utensils, straws, placemats, napkins, doggie bags, 
and
wrapping or packaging
materials that are transferred to 
customers as part of the sale of food or
beverages in the 
ordinary course of business.

    The purchase, employment and transfer of such tangible 
personal property
as newsprint and ink for the primary purpose 
of conveying news (with or
without other information) is not a 
purchase, use or sale of tangible
personal property.

    "Selling price" means the consideration for a sale valued 
in money
whether received in money or otherwise, including 
cash, credits, property
other than as hereinafter provided, and 
services, but not including the
value of or credit given for 
traded-in tangible personal property where the
item that is 
traded-in is of like kind and character as that which is being

sold, and shall be determined without any deduction on account 
of the cost
of the property sold, the cost of materials used, 
labor or service cost or
any other expense whatsoever, but does 
not include interest or finance
charges which appear as 
separate items on the bill of sale or sales
contract nor 
charges that are added to prices by sellers on account of the

seller's tax liability under the "Retailers' Occupation Tax 
Act", or on
account of the seller's duty to collect, from the 
purchaser, the tax that
is imposed by this Act, or, except as 
otherwise provided with respect to any cigarette tax imposed by 
a home rule unit, on account of the seller's tax liability 
under any local occupation tax administered by the Department, 
or, except as otherwise provided with respect to any cigarette 
tax imposed by a home rule unit on account of the seller's duty 
to collect, from the purchasers, the tax that is imposed under 
any local use tax administered by the Department. Effective 
December 1, 1985, "selling price"
shall include charges that 
are added to prices by sellers on account of the
seller's tax 
liability under the Cigarette Tax Act, on account of the 
seller's
duty to collect, from the purchaser, the tax imposed 
under the Cigarette Use
Tax Act, and on account of the seller's 
duty to collect, from the purchaser,
any cigarette tax imposed 
by a home rule unit.

    Notwithstanding any law to the contrary, for any motor 
vehicle, as defined in Section 1-146 of the Vehicle Code, that 
is sold on or after January 1, 2015 for the purpose of leasing 
the vehicle for a defined period that is longer than one year 
and (1) is a motor vehicle of the second division that: (A) is 
a self-contained motor vehicle designed or permanently 
converted to provide living quarters for recreational, 
camping, or travel use, with direct walk through access to the 
living quarters from the driver's seat; (B) is of the van 
configuration designed for the transportation of not less than 
7 nor more than 16 passengers; or (C) has a gross vehicle 
weight rating of 8,000 pounds or less or (2) is a motor vehicle 
of the first division, "selling price" or "amount of sale" 
means the consideration received by the lessor pursuant to the 
lease contract, including amounts due at lease signing and all 
monthly or other regular payments charged over the term of the 
lease.  Also included in the selling price is any amount 
received by the lessor from the lessee for the leased vehicle 
that is not calculated at the time the lease is executed, 
including, but not limited to, excess mileage charges and 
charges for excess wear and tear.  For sales that occur in 
Illinois, with respect to any amount received by the lessor 
from the lessee for the leased vehicle that is not calculated 
at the time the lease is executed, the lessor who purchased the 
motor vehicle does not incur the tax imposed by the Use Tax Act 
on those amounts, and the retailer who makes the retail sale of 
the motor vehicle to the lessor is not required to collect the 
tax imposed by this Act or to pay the tax imposed by the 
Retailers' Occupation Tax Act on those amounts.  However, the 
lessor who purchased the motor vehicle assumes the liability 
for reporting and paying the tax on those amounts directly to 
the Department in the same form (Illinois Retailers' Occupation 
Tax, and local retailers' occupation taxes, if applicable) in 
which the retailer would have reported and paid such tax if the 
retailer had accounted for the tax to the Department.  For 
amounts received by the lessor from the lessee that are not 
calculated at the time the lease is executed, the lessor must 
file the return and pay the tax to the Department by the due 
date otherwise required by this Act for returns other than 
transaction returns.  If the retailer is entitled under this Act 
to a discount for collecting and remitting the tax imposed 
under this Act to the Department with respect to the sale of 
the motor vehicle to the lessor, then the right to the discount 
provided in this Act shall be transferred to the lessor with 
respect to the tax paid by the lessor for any amount received 
by the lessor from the lessee for the leased vehicle that is 
not calculated at the time the lease is executed; provided that 
the discount is only allowed if the return is timely filed and 
for amounts timely paid.  The "selling price" of a motor vehicle 
that is sold on or after January 1, 2015 for the purpose of 
leasing for a defined period of longer than one year shall not 
be reduced by the value of or credit given for traded-in 
tangible personal property owned by the lessor, nor shall it be 
reduced by the value of or credit given for traded-in tangible 
personal property owned by the lessee, regardless of whether 
the trade-in value thereof is assigned by the lessee to the 
lessor.  In the case of a motor vehicle that is sold for the 
purpose of leasing for a defined period of longer than one 
year, the sale occurs at the time of the delivery of the 
vehicle, regardless of the due date of any lease payments. A 
lessor who incurs a Retailers' Occupation Tax liability on the 
sale of a motor vehicle coming off lease may not take a credit 
against that liability for the Use Tax the lessor paid upon the 
purchase of the motor vehicle (or for any tax the lessor paid 
with respect to any amount received by the lessor from the 
lessee for the leased vehicle that was not calculated at the 
time the lease was executed) if the selling price of the motor 
vehicle at the time of purchase was calculated using the 
definition of "selling price" as defined in this paragraph.      
Notwithstanding any other provision of this Act to the 
contrary, lessors shall file all returns and make all payments 
required under this paragraph to the Department by electronic 
means in the manner and form as required by the Department.  
This paragraph does not apply to leases of motor vehicles for 
which, at the time the lease is entered into, the term of the 
lease is not a defined period, including leases with a defined 
initial period with the option to continue the lease on a 
month-to-month or other basis beyond the initial defined 
period. 
    The phrase "like kind and character" shall be liberally 
construed
(including but not limited to any form of motor 
vehicle for any form of
motor vehicle, or any kind of farm or 
agricultural implement for any other
kind of farm or 
agricultural implement), while not including a kind of item

which, if sold at retail by that retailer, would be exempt from 
retailers'
occupation tax and use tax as an isolated or 
occasional sale.

    "Department" means the Department of Revenue.

    "Person" means any natural individual, firm, partnership, 
association,
joint stock company, joint adventure, public or 
private corporation, limited
liability company, or a
receiver, 
executor, trustee, guardian or other representative appointed

by order of any court.

    "Retailer" means and includes every person engaged in the 
business of
making sales at retail as defined in this Section.

    A person who holds himself or herself out as being engaged 
(or who habitually
engages) in selling tangible personal 
property at retail is a retailer
hereunder with respect to such 
sales (and not primarily in a service
occupation) 
notwithstanding the fact that such person designs and produces

such tangible personal property on special order for the 
purchaser and in
such a way as to render the property of value 
only to such purchaser, if
such tangible personal property so 
produced on special order serves
substantially the same 
function as stock or standard items of tangible
personal 
property that are sold at retail.

    A person whose activities are organized and conducted 
primarily as a
not-for-profit service enterprise, and who 
engages in selling tangible
personal property at retail 
(whether to the public or merely to members and
their guests) 
is a retailer with respect to such transactions, excepting
only 
a person organized and operated exclusively for charitable, 
religious
or educational purposes either (1), to the extent of 
sales by such person
to its members, students, patients or 
inmates of tangible personal property
to be used primarily for 
the purposes of such person, or (2), to the extent
of sales by 
such person of tangible personal property which is not sold or

offered for sale by persons organized for profit.  The selling 
of school
books and school supplies by schools at retail to 
students is not
"primarily for the purposes of" the school 
which does such selling.  This
paragraph does not apply to nor 
subject to taxation occasional dinners,
social or similar 
activities of a person organized and operated exclusively
for 
charitable, religious or educational purposes, whether or not 
such
activities are open to the public.

    A person who is the recipient of a grant or contract under 
Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and 
serves meals to
participants in the federal Nutrition Program 
for the Elderly in return for
contributions established in 
amount by the individual participant pursuant
to a schedule of 
suggested fees as provided for in the federal Act is not a

retailer under this Act with respect to such transactions.

    Persons who engage in the business of transferring tangible 
personal
property upon the redemption of trading stamps are 
retailers hereunder when
engaged in such business.

    The isolated or occasional sale of tangible personal 
property at retail
by a person who does not hold himself out as 
being engaged (or who does not
habitually engage) in selling 
such tangible personal property at retail or
a sale through a 
bulk vending machine does not make such person a retailer

hereunder.  However, any person who is engaged in a business 
which is not
subject to the tax imposed by the "Retailers' 
Occupation Tax Act" because
of involving the sale of or a 
contract to sell real estate or a
construction contract to 
improve real estate, but who, in the course of
conducting such 
business, transfers tangible personal property to users or

consumers in the finished form in which it was purchased, and 
which does
not become real estate, under any provision of a 
construction contract or
real estate sale or real estate sales 
agreement entered into with some
other person arising out of or 
because of such nontaxable business, is a
retailer to the 
extent of the value of the tangible personal property so

transferred.  If, in such transaction, a separate charge is made 
for the
tangible personal property so transferred, the value of 
such property, for
the purposes of this Act, is the amount so 
separately charged, but not less
than the cost of such property 
to the transferor; if no separate charge is
made, the value of 
such property, for the purposes of this Act, is the cost
to the 
transferor of such tangible personal property.

    "Retailer maintaining a place of business in this State", 
or any like
term, means and includes any of the following 
retailers:

        (1) A retailer having or maintaining within this State, 
    directly or by
a subsidiary, an office, distribution house, 
    sales house, warehouse or other
place of business, or any 
    agent or other representative operating within this
State 
    under the authority of the retailer or its subsidiary, 
    irrespective of
whether such place of business or agent or 
    other representative is located here
permanently or 
    temporarily, or whether such retailer or subsidiary is 
    licensed
to do business in this State. However, the 
    ownership of property that is
located at the premises of a 
    printer with which the retailer has contracted for
printing 
    and that consists of the final printed product, property 
    that becomes
a part of the final printed product, or copy 
    from which the printed product is
produced shall not result 
    in the retailer being deemed to have or maintain an
office, 
    distribution house, sales house, warehouse, or other place 
    of business
within this State.
        (1.1) A retailer having a contract with a person 
    located in this State under which the person, for a 
    commission or other consideration based upon the sale of 
    tangible personal property by the retailer, directly or 
    indirectly refers potential customers to the retailer by 
    providing to the potential customers a promotional code or 
    other mechanism that allows the retailer to track purchases 
    referred by such persons.  Examples of mechanisms that allow 
    the retailer to track purchases referred by such persons 
    include but are not limited to the use of a link on the 
    person's Internet website, promotional codes distributed 
    through the person's hand-delivered or mailed material, 
    and promotional codes distributed by the person through 
    radio or other broadcast media.  The provisions of this 
    paragraph (1.1) shall apply only if the cumulative gross 
    receipts from sales of tangible personal property by the 
    retailer to customers who are referred to the retailer by 
    all persons in this State under such contracts exceed 
    $10,000 during the preceding 4 quarterly periods ending on 
    the last day of March, June, September, and December. A 
    retailer meeting the requirements of this paragraph (1.1) 
    shall be presumed to be maintaining a place of business in 
    this State but may rebut this presumption by submitting 
    proof that the referrals or other activities pursued within 
    this State by such persons were not sufficient to meet the 
    nexus standards of the United States Constitution during 
    the preceding 4 quarterly periods.
        (1.2) Beginning July 1, 2011, a retailer having a 
    contract with a person located in this State under which:
            (A) the retailer sells the same or substantially 
        similar line of products as the person located in this 
        State and does so using an identical or substantially 
        similar name, trade name, or trademark as the person 
        located in this State; and
            (B) the retailer provides a commission or other 
        consideration to the person located in this State based 
        upon the sale of tangible personal property by the 
        retailer.
    The provisions of this paragraph (1.2) shall apply only if 
    the cumulative gross receipts from sales of tangible 
    personal property by the retailer to customers in this 
    State under all such contracts exceed $10,000 during the 
    preceding 4 quarterly periods ending on the last day of 
    March, June, September, and December. 

        (2) A retailer soliciting orders for tangible personal 
    property by
means of a telecommunication or television 
    shopping system (which utilizes toll
free numbers) which is 
    intended by the retailer to be broadcast by cable

    television or other means of broadcasting, to consumers 
    located in this State.

        (3) A retailer, pursuant to a contract with a 
    broadcaster or publisher
located in this State, soliciting 
    orders for tangible personal property by
means of 
    advertising which is disseminated primarily to consumers 
    located in
this State and only secondarily to bordering 
    jurisdictions.

        (4) A retailer soliciting orders for tangible personal 
    property by mail
if the solicitations are substantial and 
    recurring and if the retailer benefits
from any banking, 
    financing, debt collection, telecommunication, or 
    marketing
activities occurring in this State or benefits 
    from the location in this State
of authorized installation, 
    servicing, or repair facilities.

        (5) A retailer that is owned or controlled by the same 
    interests that own
or control any retailer engaging in 
    business in the same or similar line of
business in this 
    State.

        (6) A retailer having a franchisee or licensee 
    operating under its trade
name if the franchisee or 
    licensee is required to collect the tax under this
Section.

        (7) A retailer, pursuant to a contract with a cable 
    television operator
located in this State, soliciting 
    orders for tangible personal property by
means of 
    advertising which is transmitted or distributed over a 
    cable
television system in this State.

        (8) A retailer engaging in activities in Illinois, 
    which activities in
the state in which the retail business 
    engaging in such activities is located
would constitute 
    maintaining a place of business in that state.

        (9) Beginning October 1, 2018, a retailer making sales 
    of tangible personal property to purchasers in Illinois 
    from outside of Illinois if: 
            (A) the cumulative gross receipts from sales of 
        tangible personal property to purchasers in Illinois 
        are $100,000 or more; or 
            (B) the retailer enters into 200 or more separate 
        transactions for the sale of tangible personal 
        property to purchasers in Illinois. 
        The retailer shall determine on a quarterly basis, 
    ending on the last day of March, June, September, and 
    December, whether he or she meets the criteria of either 
    subparagraph (A) or (B) of this paragraph (9) for the 
    preceding 12-month period.  If the retailer meets the 
    criteria of either subparagraph (A) or (B) for a 12-month 
    period, he or she is considered a retailer maintaining a 
    place of business in this State and is required to collect 
    and remit the tax imposed under this Act and file returns 
    for one year.  At the end of that one-year period, the 
    retailer shall determine whether the retailer met the 
    criteria of either subparagraph (A) or (B) during the 
    preceding 12-month period.  If the retailer met the criteria 
    in either subparagraph (A) or (B) for the preceding 
    12-month period, he or she is considered a retailer 
    maintaining a place of business in this State and is 
    required to collect and remit the tax imposed under this 
    Act and file returns for the subsequent year.  If at the end 
    of a one-year period a retailer that was required to 
    collect and remit the tax imposed under this Act determines 
    that he or she did not meet the criteria in either 
    subparagraph (A) or (B) during the preceding 12-month 
    period, the retailer shall subsequently determine on a 
    quarterly basis, ending on the last day of March, June, 
    September, and December, whether he or she meets the 
    criteria of either subparagraph (A) or (B) for the 
    preceding 12-month period.
        Beginning January 1, 2020, neither the gross receipts 
    from nor the number of separate transactions for sales of 
    tangible personal property to purchasers in Illinois that a 
    retailer makes through a marketplace facilitator and for 
    which the retailer has received a certification from the 
    marketplace facilitator pursuant to Section 2d of this Act 
    shall be included for purposes of determining whether he or 
    she has met the thresholds of this paragraph (9).
        (10) Beginning January 1, 2020, a marketplace 
    facilitator, as defined in Section 2d of this Act. 
    "Bulk vending machine" means a vending machine,
containing 
unsorted confections, nuts, toys, or other items designed

primarily to be used or played with by children
which, when a 
coin or coins of a denomination not larger than $0.50 are 
inserted, are dispensed in equal portions, at random and

without selection by the customer.

(Source: P.A. 99-78, eff. 7-20-15; 100-587, eff. 6-4-18.)

 
    (35 ILCS 105/2d new)
    Sec. 2d. Marketplace facilitators and marketplace sellers.
    (a) As used in this Section:
    "Affiliate" means a person that, with respect to another 
person:  (i) has a direct or indirect ownership interest of more 
than 5 percent in the other person; or (ii) is related to the 
other person because a third person, or a group of third 
persons who are affiliated with each other as defined in this 
subsection, holds a direct or indirect ownership interest of 
more than 5% in the related person.
    "Marketplace" means a physical or electronic place, forum, 
platform, application, or other method by which a marketplace 
seller sells or offers to sell items. 
    "Marketplace facilitator" means a person who, pursuant to 
an agreement with a marketplace seller, facilitates sales of 
tangible personal property by that marketplace seller.  A person 
facilitates a sale of tangible personal property by, directly 
or indirectly through one or more affiliates, doing both of the 
following:  (i) listing or otherwise making available for sale 
the tangible personal property of the marketplace seller 
through a marketplace owned or operated by the marketplace 
facilitator; and (ii) processing sales or payments for 
marketplace sellers.
    "Marketplace seller" means a person that sells or offers to 
sell tangible personal property through a marketplace.
    (b)  Beginning on January 1, 2020, a marketplace facilitator 
who meets either of the following criteria is considered the 
retailer of each sale of tangible personal property made on the 
marketplace:
        (1) the cumulative gross receipts from sales of 
    tangible personal property to purchasers in Illinois by the 
    marketplace facilitator and by marketplace sellers are 
    $100,000 or more; or
        (2) the marketplace facilitator and marketplace 
    sellers cumulatively enter into 200 or more separate 
    transactions for the sale of tangible personal property to 
    purchasers in Illinois.
    A marketplace facilitator shall determine on a quarterly 
basis, ending on the last day of March, June, September, and 
December, whether he or she meets the criteria of either 
paragraph (1) or (2) of this subsection (b) for the preceding 
12-month period. If the marketplace facilitator meets the 
criteria of either paragraph (1) or (2) for a 12-month period, 
he or she is considered a retailer maintaining a place of 
business in this State and is required to collect and remit the 
tax imposed under this Act and file returns for one year. At 
the end of that one-year period, the marketplace facilitator 
shall determine whether the marketplace facilitator met the 
criteria of either paragraph (1) or (2) during the preceding 
12-month period. If the marketplace facilitator met the 
criteria in either paragraph (1) or (2) for the preceding 
12-month period, he or she is considered a retailer maintaining 
a place of business in this State and is required to collect 
and remit the tax imposed under this Act and file returns for 
the subsequent year. If at the end of a one-year period a 
marketplace facilitator that was required to collect and remit 
the tax imposed under this Act determines that he or she did 
not meet the criteria in either paragraph (1) or (2)  during the 
preceding 12-month period, the marketplace facilitator shall 
subsequently determine on a quarterly basis, ending on the last 
day of March, June, September, and December, whether he or she 
meets the criteria of either paragraph (1) or (2) for the 
preceding 12-month period.
    (c) A marketplace facilitator that meets either of the 
thresholds in subsection (b) of this Section is considered the 
retailer of each sale made through its marketplace and is 
liable for collecting and remitting the tax under this Act on 
all such sales.  The marketplace facilitator has all the rights 
and duties, and is required to comply with the same 
requirements and procedures, as all other retailers 
maintaining a place of business in this State who are 
registered or who are required to be registered to collect and 
remit the tax imposed by this Act.
    (d)  A marketplace facilitator shall:
        (1)  certify to each marketplace seller that the 
    marketplace facilitator assumes the rights and duties of a 
    retailer under this Act with respect to sales made by the 
    marketplace seller through the marketplace; and
        (2) collect taxes imposed by this Act as required by 
    Section 3-45 of this Act for sales made through the 
    marketplace.
    (e) A marketplace seller shall retain books and records for 
all sales made through a marketplace in accordance with the 
requirements of Section 11.
    (f) A marketplace seller shall furnish to the marketplace 
facilitator information that is necessary for the marketplace 
facilitator to correctly collect and remit taxes for a retail 
sale.  The information may include a certification that an item 
being sold is taxable, not taxable, exempt from taxation, or 
taxable at a specified rate. A marketplace seller shall be held 
harmless for liability for the tax imposed under this Act when 
a marketplace facilitator fails to correctly collect and remit 
tax after having been provided with information by a 
marketplace seller to correctly collect and remit taxes imposed 
under this Act.
    (g) Except as provided in subsection (h), if the 
marketplace facilitator demonstrates to the satisfaction of 
the Department that its failure to correctly collect and remit 
tax on a retail sale resulted from the marketplace 
facilitator's good faith reliance on incorrect or insufficient 
information provided by a marketplace seller, it shall be 
relieved of liability for the tax on that retail sale.  In this 
case, a marketplace seller is liable for any resulting tax due.
    (h)  A marketplace facilitator and marketplace seller that 
are affiliates, as defined by subsection (a), are jointly and 
severally liable for tax liability resulting from a sale made 
by the affiliated marketplace seller through the marketplace.
    (i) This Section does not affect the tax liability of a 
purchaser under this Act.
    (j) The Department may adopt rules for the administration 
and enforcement of the provisions of this Section.
 
    Section 10-15. The Service Use Tax Act is amended  by 
changing Section 2 and  by adding Section 2d as follows:
 



    (35 ILCS 110/2)  (from Ch. 120, par. 439.32)



    Sec. 2. Definitions.  In this Act: 
    "Use" means the exercise by any person of any right or 
power
over tangible personal property incident to the ownership 
of that
property, but does not include the sale or use for 
demonstration by him
of that property in any form as tangible 
personal property in the
regular course of business.
"Use" does 
not mean the interim
use of
tangible personal property nor the 
physical incorporation of tangible
personal property, as an 
ingredient or constituent, into other tangible
personal 
property, (a) which is sold in the regular course of business

or (b) which the person incorporating such ingredient or 
constituent
therein has undertaken at the time of such purchase 
to cause to be
transported in interstate commerce to 
destinations outside the State of
Illinois.

    "Purchased from a serviceman" means the acquisition of the 
ownership
of, or title to, tangible personal property through a 
sale of service.

    "Purchaser" means any person who, through a sale of 
service, acquires
the ownership of, or title to, any tangible 
personal property.

    "Cost price" means the consideration paid by the serviceman 
for a
purchase valued in money, whether paid in money or 
otherwise, including
cash, credits and services, and shall be 
determined without any
deduction on account of the supplier's 
cost of the property sold or on
account of any other expense 
incurred by the supplier. When a serviceman
contracts out part 
or all of the services required in his sale of service,
it 
shall be presumed that the cost price to the serviceman of the 
property
transferred to him or her by his or her subcontractor 
is equal to 50% of
the subcontractor's charges to the 
serviceman in the absence of proof of
the consideration paid by 
the subcontractor for the purchase of such property.

    "Selling price" means the consideration for a sale valued 
in money
whether received in money or otherwise, including 
cash, credits and
service, and shall be determined without any 
deduction on account of the
serviceman's cost of the property 
sold, the cost of materials used,
labor or service cost or any 
other expense whatsoever, but does not
include interest or 
finance charges which appear as separate items on
the bill of 
sale or sales contract nor charges that are added to prices
by 
sellers on account of the seller's duty to collect, from the

purchaser, the tax that is imposed by this Act.

    "Department" means the Department of Revenue.

    "Person" means any natural individual, firm, partnership,

association, joint stock company, joint venture, public or 
private
corporation, limited liability company, and any 
receiver, executor, trustee,
guardian or other representative 
appointed by order of any court.

    "Sale of service" means any transaction except:

        (1) a retail sale of tangible personal property taxable 
    under the
Retailers' Occupation Tax Act or under the Use 
    Tax Act.

        (2) a sale of tangible personal property for the 
    purpose of resale
made in compliance with Section 2c of the 
    Retailers' Occupation Tax Act.

        (3) except as hereinafter provided, a sale or transfer 
    of tangible
personal property as an incident to the 
    rendering of service for or by
any governmental body, or 
    for or by any corporation, society,
association, 
    foundation or institution organized and operated

    exclusively for charitable, religious or educational 
    purposes or any
not-for-profit corporation, society, 
    association, foundation,
institution or organization which 
    has no compensated officers or
employees and which is 
    organized and operated primarily for the
recreation of 
    persons 55 years of age or older. A limited liability 
    company
may qualify for the exemption under this paragraph 
    only if the limited
liability company is organized and 
    operated exclusively for educational
purposes.

        (4) (blank).

        (4a) a sale or transfer of tangible personal
property 
    as an incident
to the rendering of service for owners, 
    lessors, or shippers of tangible
personal property which is 
    utilized by interstate carriers for hire for
use as rolling 
    stock moving in interstate commerce so long as so used by

    interstate carriers for hire, and equipment operated by a

    telecommunications provider, licensed as a common carrier 
    by the Federal
Communications Commission, which is 
    permanently installed in or affixed to
aircraft moving in 
    interstate commerce.

        (4a-5) on and after July 1, 2003 and through June 30, 
    2004, a sale or transfer of a motor vehicle
of
the
second 
    division with a gross vehicle weight in excess of 8,000 
    pounds as an
incident to the rendering of service if that 
    motor
vehicle is subject
to the commercial distribution fee 
    imposed under Section 3-815.1 of the
Illinois Vehicle
Code.   
    Beginning on July 1, 2004 and through June 30, 2005, the 
    use in this State of motor vehicles of the second division: 
    (i) with a gross vehicle weight rating in excess of 8,000 
    pounds; (ii) that are subject to the commercial 
    distribution fee imposed under Section 3-815.1 of the 
    Illinois Vehicle Code; and (iii) that are primarily used 
    for commercial purposes. Through June 30, 2005, this


    exemption applies to repair and replacement parts added 
    after the
initial
purchase of such a motor vehicle if that 
    motor vehicle is used in a manner that
would
qualify for 
    the rolling stock exemption otherwise provided for in this 
    Act. For purposes of this paragraph, "used for commercial 
    purposes" means the transportation of persons or property 
    in furtherance of any commercial or industrial enterprise 
    whether for-hire or not.


        (5) a sale or transfer of machinery and equipment used 
    primarily in the
process of the manufacturing or 
    assembling, either in an existing, an expanded
or a new 
    manufacturing facility, of tangible personal property for 
    wholesale or
retail sale or lease, whether such sale or 
    lease is made directly by the
manufacturer or by some other 
    person, whether the materials used in the process
are owned 
    by the manufacturer or some other person, or whether such 
    sale or
lease is made apart from or as an incident to the 
    seller's engaging in a
service occupation and the 
    applicable tax is a Service Use Tax or Service
Occupation 
    Tax, rather than Use Tax or Retailers' Occupation Tax. The 
    exemption provided by this paragraph (5) does not include 
    machinery and equipment used in (i) the generation of 
    electricity for wholesale or retail sale; (ii) the 
    generation or treatment of natural or artificial gas for 
    wholesale or retail sale that is delivered to customers 
    through pipes, pipelines, or mains; or (iii)  the treatment 
    of water for wholesale or retail sale that is delivered to 
    customers through pipes, pipelines, or mains.    The 
    provisions of Public Act 98-583 are declaratory of existing 
    law as to the meaning and scope of this exemption. The 
    exemption under this paragraph (5) is exempt from the 
    provisions of Section 3-75. 

        (5a) the repairing, reconditioning or remodeling, for 
    a
common carrier by rail, of tangible personal property 
    which belongs to such
carrier for hire, and as to which 
    such carrier receives the physical possession
of the 
    repaired, reconditioned or remodeled item of tangible 
    personal property
in Illinois, and which such carrier 
    transports, or shares with another common
carrier in the 
    transportation of such property, out of Illinois on a 
    standard
uniform bill of lading showing the person who 
    repaired, reconditioned or
remodeled the property to a 
    destination outside Illinois, for use outside
Illinois.

        (5b) a sale or transfer of tangible personal property 
    which is produced by
the seller thereof on special order in 
    such a way as to have made the
applicable tax the Service 
    Occupation Tax or the Service Use Tax, rather than
the 
    Retailers' Occupation Tax or the Use Tax, for an interstate 
    carrier by rail
which receives the physical possession of 
    such property in Illinois, and which
transports such 
    property, or shares with another common carrier in the

    transportation of such property, out of Illinois on a 
    standard uniform bill of
lading showing the seller of the 
    property as the shipper or consignor of such
property to a 
    destination outside Illinois, for use outside Illinois.

        (6) until July 1, 2003, a sale or transfer of 
    distillation machinery
and equipment, sold
as a unit or kit 
    and assembled or installed by the retailer, which
machinery 
    and equipment is certified by the user to be used only for 
    the
production of ethyl alcohol that will be used for 
    consumption as motor fuel
or as a component of motor fuel 
    for the personal use of such user and not
subject to sale 
    or resale.

        (7) at the election of any serviceman not required to 
    be
otherwise registered as a retailer under Section 2a of 
    the Retailers'
Occupation Tax Act, made for each fiscal 
    year sales
of service in which the aggregate annual cost 
    price of tangible
personal property transferred as an 
    incident to the sales of service is
less than 35%, or 75% 
    in the case of servicemen transferring prescription
drugs 
    or servicemen engaged in graphic arts production, of the 
    aggregate
annual total gross receipts from all sales of 
    service. The purchase of
such tangible personal property by 
    the serviceman shall be subject to tax
under the Retailers' 
    Occupation Tax Act and the Use Tax Act.
However, if a

    primary serviceman who has made the election described in 
    this paragraph
subcontracts service work to a secondary 
    serviceman who has also made the
election described in this 
    paragraph, the primary serviceman does not
incur a Use Tax 
    liability if the secondary serviceman (i) has paid or will 
    pay
Use
Tax on his or her cost price of any tangible 
    personal property transferred
to the primary serviceman 
    and (ii) certifies that fact in writing to the
primary

    serviceman.

    Tangible personal property transferred incident to the 
completion of a
maintenance agreement is exempt from the tax 
imposed pursuant to this Act.

    Exemption (5) also includes machinery and equipment used in 
the general
maintenance or repair of such exempt machinery and 
equipment or for in-house
manufacture of exempt machinery and 
equipment. On and after July 1, 2017, exemption (5) also

includes graphic arts machinery and equipment, as
defined in 
paragraph (5) of Section 3-5. The machinery and equipment 
exemption does not include machinery and equipment used in (i) 
the generation of electricity for wholesale or retail sale; 
(ii) the generation or treatment of natural or artificial gas 
for wholesale or retail sale that is delivered to customers 
through pipes, pipelines, or mains; or (iii) the treatment of 
water for wholesale or retail sale that is delivered to 
customers through pipes, pipelines, or mains.   The provisions of 
Public Act 98-583 are declaratory of existing law as to the 
meaning and scope of this exemption. For the purposes of 
exemption
(5), each of these terms shall have the following 
meanings:  (1) "manufacturing
process" shall mean the 
production of any article of tangible personal
property, 
whether such article is a finished product or an article for 
use in
the process of manufacturing or assembling a different 
article of tangible
personal property, by procedures commonly 
regarded as manufacturing,
processing, fabricating, or 
refining which changes some existing
material or materials into 
a material with a different form, use or
name.  In relation to a 
recognized integrated business composed of a
series of 
operations which collectively constitute manufacturing, or

individually constitute manufacturing operations, the 
manufacturing
process shall be deemed to commence with the 
first operation or stage of
production in the series, and shall 
not be deemed to end until the
completion of the final product 
in the last operation or stage of
production in the series; and 
further, for purposes of exemption (5),
photoprocessing is 
deemed to be a manufacturing process of tangible
personal 
property for wholesale or retail sale; (2) "assembling process" 
shall
mean the production of any article of tangible personal 
property, whether such
article is a finished product or an 
article for use in the process of
manufacturing or assembling a 
different article of tangible personal
property, by the 
combination of existing materials in a manner commonly
regarded 
as assembling which results in a material of a different form,

use or name; (3) "machinery" shall mean major mechanical 
machines or
major components of such machines contributing to a 
manufacturing or
assembling process; and (4) "equipment" shall 
include any independent
device or tool separate from any 
machinery but essential to an
integrated manufacturing or 
assembly process; including computers
used primarily in a 
manufacturer's computer
assisted design, computer assisted 
manufacturing (CAD/CAM) system;
or any subunit or assembly 
comprising a component of any machinery or
auxiliary, adjunct 
or attachment parts of machinery, such as tools, dies,
jigs, 
fixtures, patterns and molds; or any parts which require 
periodic
replacement in the course of normal operation; but 
shall not include hand
tools.
Equipment includes chemicals or 
chemicals acting as catalysts but only if the
chemicals or 
chemicals acting as catalysts effect a direct and immediate 
change
upon a
product being manufactured or assembled for 
wholesale or retail sale or
lease.
The purchaser of such 
machinery and equipment who has an active
resale registration 
number shall furnish such number to the seller at the
time of 
purchase. The user of such machinery and equipment and tools

without an active resale registration number shall prepare a 
certificate of
exemption for each transaction stating facts 
establishing the exemption for
that transaction, which 
certificate shall be available to the Department
for inspection 
or audit.  The Department shall prescribe the form of the

certificate.

    Any informal rulings, opinions or letters issued by the 
Department in
response to an inquiry or request for any opinion 
from any person
regarding the coverage and applicability of 
exemption (5) to specific
devices shall be published, 
maintained as a public record, and made
available for public 
inspection and copying.  If the informal ruling,
opinion or 
letter contains trade secrets or other confidential

information, where possible the Department shall delete such 
information
prior to publication.  Whenever such informal 
rulings, opinions, or
letters contain any policy of general 
applicability, the Department
shall formulate and adopt such 
policy as a rule in accordance with the
provisions of the 
Illinois Administrative Procedure Act.

    On and after July 1, 1987, no entity otherwise eligible 
under exemption
(3) of this Section shall make tax-free 
purchases unless it has an active
exemption identification 
number issued by the Department.

    The purchase, employment and transfer of such tangible 
personal
property as newsprint and ink for the primary purpose 
of conveying news
(with or without other information) is not a 
purchase, use or sale of
service or of tangible personal 
property within the meaning of this Act.

    "Serviceman" means any person who is engaged in the 
occupation of
making sales of service.

    "Sale at retail" means "sale at retail" as defined in the 
Retailers'
Occupation Tax Act.

    "Supplier" means any person who makes sales of tangible 
personal
property to servicemen for the purpose of resale as an 
incident to a
sale of service.

    "Serviceman maintaining a place of business in this State", 
or any
like term, means and includes any serviceman:

        (1) having or maintaining within this State, directly 
    or by a
subsidiary, an office, distribution house, sales 
    house, warehouse or
other place of business, or any agent 
    or other representative operating
within this State under 
    the authority of the serviceman or its
subsidiary, 
    irrespective of whether such place of business or agent or

    other representative is located here permanently or 
    temporarily, or
whether such serviceman or subsidiary is 
    licensed to do business in this
State;
        (1.1) having a contract with a person located in this 
    State under which the person, for a commission or other 
    consideration based on the sale of service by the 
    serviceman, directly or indirectly refers potential 
    customers to the serviceman by providing to the potential 
    customers a promotional code or other mechanism that allows 
    the serviceman to track purchases referred by such persons. 
    Examples of mechanisms that allow the serviceman to track 
    purchases referred by such persons include but are not 
    limited to the use of a link on the person's Internet 
    website, promotional codes distributed through the 
    person's hand-delivered or mailed material, and 
    promotional codes distributed by the person through radio 
    or other broadcast media. The provisions of this paragraph 
    (1.1) shall apply only if the cumulative gross receipts 
    from sales of service by the serviceman to customers who 
    are referred to the serviceman by all persons in this State 
    under such contracts exceed $10,000 during the preceding 4 
    quarterly periods ending on the last day of March, June, 
    September, and December; a serviceman meeting the 
    requirements of this paragraph (1.1) shall be presumed to 
    be maintaining a place of business in this State but may 
    rebut this presumption by submitting proof that the 
    referrals or other activities pursued within this State by 
    such persons were not sufficient to meet the nexus 
    standards of the United States Constitution during the 
    preceding 4 quarterly periods; 
        (1.2) beginning July 1, 2011, having a contract with a 
    person located in this State under which:
            (A) the serviceman sells the same or substantially 
        similar line of services as the person located in this 
        State and does so using an identical or substantially 
        similar name, trade name, or trademark as the person 
        located in this State; and
            (B) the serviceman provides a commission or other 
        consideration to the person located in this State based 
        upon the sale of services by the serviceman.
    The provisions of this paragraph (1.2) shall apply only if 
    the cumulative gross receipts from sales of service by the 
    serviceman to customers in this State under all such 
    contracts exceed $10,000 during the preceding 4 quarterly 
    periods ending on the last day of March, June, September, 
    and December; 

        (2) soliciting orders for tangible personal property 
    by means of a
telecommunication or television shopping 
    system (which utilizes toll free
numbers) which is intended 
    by the retailer to be broadcast by cable
television or 
    other means of broadcasting, to consumers located in this 
    State;

        (3) pursuant to a contract with a broadcaster or 
    publisher located in this
State, soliciting orders for 
    tangible personal property by means of advertising
which is 
    disseminated primarily to consumers located in this State 
    and only
secondarily to bordering jurisdictions;

        (4) soliciting orders for tangible personal property 
    by mail if the
solicitations are substantial and recurring 
    and if the retailer benefits
from any banking, financing, 
    debt collection, telecommunication, or
marketing 
    activities occurring in this State or benefits from the 
    location
in this State of authorized installation, 
    servicing, or repair facilities;

        (5) being owned or controlled by the same interests 
    which own or
control any retailer engaging in business in 
    the same or similar line of
business in this State;

        (6) having a franchisee or licensee operating under its 
    trade name if
the franchisee or licensee is required to 
    collect the tax under this Section;

        (7) pursuant to a contract with a cable television 
    operator located in
this State, soliciting orders for 
    tangible personal property by means of
advertising which is 
    transmitted or distributed over a cable television
system 
    in this State;

        (8) engaging in activities in Illinois, which 
    activities in the
state in which the supply business 
    engaging in such activities is located
would constitute 
    maintaining a place of business in that state; or

        (9) beginning October 1, 2018, making sales of service 
    to purchasers in Illinois from outside of Illinois if: 
            (A) the cumulative gross receipts from sales of 
        service to purchasers in Illinois are $100,000 or more; 
        or 
            (B) the serviceman enters into 200 or more separate 
        transactions for sales of service to purchasers in 
        Illinois. 
        The serviceman shall determine on a quarterly basis, 
    ending on the last day of March, June, September, and 
    December, whether he or she meets the criteria of either 
    subparagraph (A) or (B) of this paragraph (9) for the 
    preceding 12-month period.  If the serviceman meets the 
    criteria of either subparagraph (A) or (B) for a 12-month 
    period, he or she is considered a serviceman maintaining a 
    place of business in this State and is required to collect 
    and remit the tax imposed under this Act and file returns 
    for one year.  At the end of that one-year period, the 
    serviceman shall determine whether the serviceman met the 
    criteria of either subparagraph (A) or (B) during the 
    preceding 12-month period.  If the serviceman met the 
    criteria in either subparagraph (A) or (B) for the 
    preceding 12-month period, he or she is considered a 
    serviceman maintaining a place of business in this State 
    and is required to collect and remit the tax imposed under 
    this Act and file returns for the subsequent year.  If at 
    the end of a one-year period a serviceman that was required 
    to collect and remit the tax imposed under this Act 
    determines that he or she did not meet the criteria in 
    either subparagraph (A) or (B) during the preceding 
    12-month period, the serviceman subsequently shall 
    determine on a quarterly basis, ending on the last day of 
    March, June, September, and December, whether he or she 
    meets the criteria of either subparagraph (A) or (B) for 
    the preceding 12-month period.
        Beginning January 1, 2020, neither the gross receipts 
    from nor the number of separate transactions for sales of 
    service to purchasers in Illinois that a serviceman makes 
    through a marketplace facilitator and for which the 
    serviceman has received a certification from the 
    marketplace facilitator pursuant to Section 2d of this Act 
    shall be included for purposes of determining whether he or 
    she has met the thresholds of this paragraph (9).
        (10) Beginning January 1, 2020, a marketplace 
    facilitator, as defined in Section 2d of this Act. 
(Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 
100-587, eff. 6-4-18; 100-863, eff. 8-14-18.)

 
    (35 ILCS 110/2d new)
    Sec. 2d. Marketplace facilitators and marketplace 
servicemen.
    (a) Definitions.  For purposes of this Section:
    "Affiliate" means a person that, with respect to another 
person:  (i) has a direct or indirect ownership interest of more 
than 5% in the other person; or (ii) is related to the other 
person because a third person, or group of third persons who 
are affiliated with each other as defined in this subsection, 
holds a direct or indirect ownership interest of more than 5% 
in the related person.
    "Marketplace" means a physical or electronic place, forum, 
platform, application or other method by which a marketplace 
serviceman makes or offers to make sales of service. 
    "Marketplace facilitator" means a person who, pursuant to 
an agreement with a marketplace serviceman, facilitates sales 
of service by that marketplace serviceman.  A person facilitates 
a sale of service by, directly or indirectly through one or 
more affiliates, doing both of the following:  (i) listing or 
otherwise making available a sale of service of the marketplace 
serviceman through a marketplace owned or operated by the 
marketplace facilitator; and (ii) processing sales of service 
for, or payments for sales of service by, marketplace 
servicemen.
    "Marketplace serviceman" means a person that makes or 
offers to make a sale of service through a marketplace.
    (b)  Beginning January 1, 2020, a marketplace facilitator 
who meets either of the following criteria is considered the 
serviceman for each sale of service made on the marketplace:
        (1) the cumulative gross receipts from sales of service 
    to purchasers in Illinois by the marketplace facilitator 
    and by marketplace servicemen are $100,000 or more; or
        (2) the marketplace facilitator and marketplace 
    servicemen cumulatively enter into 200 or more separate 
    transactions for the sale of service to purchasers in 
    Illinois.
    A marketplace facilitator shall determine on a quarterly 
basis, ending on the last day of March, June, September, and 
December, whether he or she meets the criteria of either 
paragraph (1) or (2) of this subsection (b) for the preceding 
12-month period. If the marketplace facilitator meets the 
criteria of either paragraph (1) or (2) for a 12-month period, 
he or she is considered a serviceman maintaining a place of 
business in this State and is required to collect and remit the 
tax imposed under this Act and file returns for one year. At 
the end of that one-year period, the marketplace facilitator 
shall determine whether the marketplace facilitator met the 
criteria of either paragraph (1) or (2) during the preceding 
12-month period. If the marketplace facilitator met the 
criteria in either paragraph (1) or (2) for the preceding 
12-month period, he or she is considered a serviceman 
maintaining a place of business in this State and is required 
to collect and remit the tax imposed under this Act and file 
returns for the subsequent year. If, at the end of a one-year 
period, a marketplace facilitator that was required to collect 
and remit the tax imposed under this Act determines that he or 
she did not meet the criteria in either paragraph (1) or (2) 
during the preceding 12-month period, the marketplace 
facilitator shall subsequently determine on a quarterly basis, 
ending on the last day of March, June, September, and December, 
whether he or she meets the criteria of either paragraph (1) or 
(2) for the preceding 12-month period.
    (c) A marketplace facilitator that meets either of the 
thresholds in subsection (b) of this Section is considered the 
serviceman for each sale of service made through its 
marketplace and is liable for collecting and remitting the tax 
under this Act on all such sales.  The marketplace facilitator 
has all the rights and duties, and is required to comply with 
the same requirements and procedures, as all other servicemen 
maintaining a place of business in this State who are 
registered or who are required to be registered to collect and 
remit the tax imposed by this Act.
    (d)  A marketplace facilitator shall:
        (1)  certify to each marketplace serviceman that the 
    marketplace facilitator assumes the rights and duties of a 
    serviceman under this Act with respect to sales of service 
    made by the marketplace serviceman through the 
    marketplace; and
        (2) collect taxes imposed by this Act as required by 
    Section 3-40 of this Act for sales of service made through 
    the marketplace.
    (e) A marketplace serviceman shall retain books and records 
for all sales of service made through a marketplace in 
accordance with the requirements of Section 11.
    (f) A marketplace serviceman shall furnish to the 
marketplace facilitator information that is necessary for the 
marketplace facilitator to correctly collect and remit taxes 
for a sale of service.  The information may include a 
certification that an item transferred incident to a sale of 
service under this Act is taxable, not taxable, exempt from 
taxation, or taxable at a specified rate. A marketplace 
serviceman shall be held harmless for liability for the tax 
imposed under this Act when a marketplace facilitator fails to 
correctly collect and remit tax after having been provided with 
information by a marketplace serviceman to correctly collect 
and remit taxes imposed under this Act.
    (g) Except as provided in subsection (h), if the 
marketplace facilitator demonstrates to the satisfaction of 
the Department that its failure to correctly collect and remit 
tax on a sale of service resulted from the marketplace 
facilitator's good faith reliance on incorrect or insufficient 
information provided by a marketplace serviceman, it shall be 
relieved of liability for the tax on that sale of service.  In 
this case, a marketplace serviceman is liable for any resulting 
tax due.
    (h)  A marketplace facilitator and marketplace serviceman 
that are affiliates, as defined by subsection (a), are jointly 
and severally liable for tax liability resulting from a sale of 
service made by the affiliated marketplace serviceman through 
the marketplace.
    (i) This Section does not affect the tax liability of a 
purchaser under this Act.
    (j) The Department may adopt rules for the administration 
and enforcement of the provisions of this Section. 
 
    Section 10-35. The Tax Delinquency Amnesty Act is amended  
by changing Section 10 as follows:
 



    (35 ILCS 745/10)



    Sec. 10. Amnesty program. The Department shall establish an 
amnesty
program for all taxpayers owing any tax imposed by 
reason of or pursuant to
authorization by any law of the State 
of Illinois and collected by the
Department.

    The amnesty program shall be for a period from October 1, 
2003 through
November 15, 2003 and for a period beginning on 
October 1, 2010 and ending November 8, 2010 and for a period 
beginning on October 1, 2019 and ending on November 15, 2019.

    The amnesty program shall provide that, upon payment by a 
taxpayer of all
taxes
due from that taxpayer to the State of 
Illinois for any taxable period ending
(i) after June 30,
1983 
and prior to July 1, 2002 for the tax amnesty period occurring 
from October 1, 2003 through
November 15, 2003, and (ii) after 
June 30, 2002 and prior to July 1, 2009  for the tax amnesty 
period beginning on October 1, 2010 through November 8, 2010, 
and (iii) after June 30, 2011 and prior to July 1, 2018 for the 
tax amnesty period beginning on October 1, 2019 through 
November 15, 2019, the
Department shall abate and not seek to 
collect any interest or penalties that
may be
applicable and 
the Department shall not seek civil or criminal prosecution for

any taxpayer for the period of time for which amnesty has been 
granted to the
taxpayer. Failure to pay all taxes due to the 
State for a taxable period shall
invalidate any
amnesty granted 
under this Act. Amnesty shall be granted only if all amnesty

conditions are
satisfied by the taxpayer.

    Amnesty shall not be granted to taxpayers who are a party 
to any criminal
investigation or to any civil or criminal 
litigation that is pending in any
circuit court or appellate 
court or the Supreme Court of this State for
nonpayment, 
delinquency, or fraud in relation to any State tax imposed by 
any
law of the State of Illinois.

    Participation in an amnesty program shall not preclude a 
taxpayer from claiming a refund for an overpayment of tax on an 
issue unrelated to the issues for which the taxpayer claimed 
amnesty or for an overpayment of tax by taxpayers estimating a 
non-final liability for the amnesty program pursuant to Section 
506(b) of the Illinois Income Tax Act (35 ILCS 5/506(b)). 
    Voluntary payments made under this Act shall be made by 
cash, check,
guaranteed remittance, or ACH debit.

    The Department shall adopt rules as necessary to implement 
the provisions of
this Act.

    Except as otherwise provided in this Section, all money 
collected under this
Act that would otherwise be deposited into 
the General Revenue Fund shall be
deposited as
follows: (i) 
one-half into the Common School Fund; (ii) one-half into the

General
Revenue Fund. Two percent of all money collected under 
this Act shall be
deposited by
the State Treasurer into the Tax 
Compliance and Administration Fund and,
subject to

appropriation, shall be used by the Department to cover costs 
associated with
the administration of this Act.

(Source: P.A. 96-1435, eff. 8-16-10.)

 
    Section 10-40. The Health Maintenance Organization Act is 
amended  by changing Section 5-5 and by adding Section 5-10 as 
follows:
 



    (215 ILCS 125/5-5)  (from Ch. 111 1/2, par. 1413)



    Sec. 5-5. Suspension, revocation or denial of 
certification of authority. The Director may suspend or revoke 
any certificate of authority issued
to a health maintenance 
organization under this Act or deny an
application for a 
certificate of authority if he finds any of the
following:

    (a) The health maintenance organization is operating 
significantly
in contravention of its basic organizational 
document, its health care
plan, or in a manner contrary to that 
described in any information
submitted under Section 2-1 or 
4-12.

    (b) The health maintenance organization issues contracts 
or
evidences of coverage or uses a schedule of charges for 
health care
services that do not comply with the requirement of 
Section 2-1
or 4-12.

    (c) The health care plan does not provide or arrange for 
basic health
care services, except as provided in Section 4-13 
concerning mental health
services for clients of the Department 
of Children and Family Services.

    (d) The Director of Public Health certifies to the Director 
that
(1) the health maintenance organization does not meet the 
requirements of
Section 2-2 or (2) the health maintenance 
organization is unable to fulfill
its obligations to furnish 
health care services as required under its
health care plan.  
The Department of Public Health shall promulgate by
rule, 
pursuant to the Illinois Administrative Procedure Act, the 
precise
standards used for determining what constitutes a 
material
misrepresentation, what constitutes a material 
violation of a contract or
evidence of coverage, or what 
constitutes good faith with regard to
certification under this 
paragraph.

    (e) The health maintenance organization is no longer 
financially
responsible and may reasonably be expected to be 
unable to meet its
obligations to enrollees or prospective 
enrollees.

    (f) The health maintenance organization, or any person on 
its behalf,
has advertised or merchandised its services in an 
untrue, misrepresentative,
misleading, deceptive, or unfair 
manner.

    (g) The continued operation of the health maintenance 
organization would
be hazardous to its enrollees.

    (h) The health maintenance organization has neglected to 
correct, within the
time prescribed by subsection (c) of 
Section 2-4, any deficiency occurring due
to the organization's 
prescribed minimum net worth or special contingent
reserve 
being impaired.

    (i) The health maintenance organization has otherwise 
failed to
substantially comply with this Act.

    (j) The health maintenance organization has failed to meet 
the
requirements for issuance of a certificate of authority set 
forth in
Section 2-2.

    When the certificate of authority of a health maintenance 
organization
is revoked, the organization shall proceed, 
immediately following the
effective date of the order of 
revocation, to wind up its affairs and shall
conduct no further 
business except as may be essential to the orderly
conclusion 
of the affairs of the organization. The Director may permit 
further
operation of the organization that he finds to be in 
the best interest of
enrollees to the end that the enrollees 
will be afforded the greatest practical
opportunity to obtain 
health care services.

    (k)   The health maintenance organization has failed to pay 
any assessment due under Article V-H of the Public Aid Code for 
60 days following the due date of the payment (as extended by 
any grace period granted).
(Source: P.A. 88-487.)

 
    (215 ILCS 125/5-10 new)
    Sec. 5-10. Managed care organizations; revenue data.
    (a)  No managed care organization shall pass the cost of the 
assessment imposed pursuant to Article V-H of the Public Aid 
Code on to consumers as a discrete addition to their premiums.
    (b) The Department shall provide the Department of 
Healthcare and Family Services with member months and premium 
revenue data needed for implementing the assessment imposed 
under Article V-H of the Public Aid Code.
 
    Section 10-45. The Illinois Public Aid Code is amended  by 
adding the Article V-H as follows:
 
    (305 ILCS 5/Art. V-H heading new)
ARTICLE V-H.  MANAGED CARE ORGANIZATION PROVIDER ASSESSMENT.

 
    (305 ILCS 5/5H-1 new)
    Sec. 5H-1. Definitions.  As used in this Article: 
    "Base year" means the 12-month period from January 1, 2018 
to December 31, 2018.
    "Department" means the Department of Healthcare and Family 
Services.
    "Federal employee health benefit" means the program of 
health benefits plans, as defined in 5 U.S.C. 8901, available 
to federal employees under 5 U.S.C. 8901 to 8914.
    "Fund" means the Healthcare Provider Relief Fund.
    "Managed care organization" means an entity operating  
under a certificate of authority issued pursuant to the Health 
Maintenance Organization Act or as a Managed Care Community 
Network pursuant to Section 5-11 of the Public Aid Code.
    "Medicaid managed care organization" means a managed care 
organization under contract with the Department to provide 
services to recipients of benefits in the medical assistance 
program pursuant to Article V of the Public Aid Code, the 
Children's Health Insurance Program Act, or the Covering ALL 
KIDS Health Insurance Act. It does not include contracts the 
same entity or an affiliated entity has for other business.
    "Medicare" means the federal Medicare program established 
under Title XVIII of the federal Social Security Act.
    "Member months" means the aggregate total number of months 
all individuals are enrolled for coverage in a Managed Care 
Organization during the base year. Member months are determined 
by the Department for Medicaid Managed Care Organizations based 
on enrollment data in its Medicaid Management Information 
System and by the Department of Insurance for other Managed 
Care Organizations based on required filings with the 
Department of Insurance.  Member months do not include months 
individuals are enrolled in a Limited Health Services 
Organization, including stand-alone dental or vision plans, a 
Medicare Advantage Plan, a Medicare Supplement Plan, a Medicaid 
Medicare Alignment Initiate Plan pursuant to a Memorandum of 
Understanding between the Department and the Federal Centers 
for Medicare and Medicaid Services or a Federal Employee Health 
Benefits Plan.
 
    (305 ILCS 5/5H-2 new)
    Sec. 5H-2. Federal waivers.  The Department shall request a 
waiver from the federal Centers for Medicare and Medicaid 
Services of the broad-based and uniformity provisions of 
Section 1903(w)(3)(B) and (C) of Title XIX of the Social 
Security Act, 42 U.S.C. 1396b, relating to the assessment 
imposed under this Article. The assessment required pursuant to 
Section 5H-3 shall not be due and payable until such waiver has 
been approved and all other federal requirements necessary to 
obtain federal financial participation have been approved by 
the Centers for Medicare and Medicaid Services.
 
    (305 ILCS 5/5H-3 new)
    Sec. 5H-3. Managed care assessment.
    (a)  For State Fiscal year 2020 through State Fiscal Year 
2025, there is imposed upon managed care organization member 
months an assessment, calculated on base year data, as set 
forth below for the appropriate tier: 
        (1)  Tier 1: $60.20 per member month.
        (2)  Tier 2: $1.20 per member month.
        (3)  Tier 3: $2.40 per member month.
    (b)   The tiers are established as follows:
        (1) Tier 1 includes the first 4,195,000 member months 
    in a Medicaid managed care organization for the base year;
        (ii) Tier 2 includes member months over 4,195,000 in a 
    Medicaid managed care organization during the base year; 
    and
        (iv)  Tier 3 includes member months during the base year 
    in a managed care organization that is not a Medicaid 
    managed care organization.
    (c)   For State fiscal year 2020 through State fiscal year 
2025, the Department may by rule adjust rates or tier 
parameters or both in order to maximize the revenue generated 
by the assessment consistent with federal regulations and to 
meet federal statistical tests necessary for federal financial 
participation. Any upward adjustment to the Tier 3 rate shall 
be the minimum necessary to meet federal statistical tests.
 
    (305 ILCS 5/5H-4 new)
    Sec. 5H-4. Payment of assessment.
    (a)  The assessment payable pursuant to Section 5H-3 shall 
be due and payable in monthly installments, each equaling 
one-twelfth of the assessment for the year, on the first State 
business day of each month.
    (b) If the approval of the waivers required under Section 
5H-2 is delayed beyond the start of State fiscal year 2020, 
then the first installment shall be due on the first business 
day of the first month that begins more than 15 days after the 
date of such approval.  In the event approval results in 
installments beginning after July 1, 2019, the amount of each 
installment for that fiscal year shall equal the full amount of 
the annual assessment divided by the number of payments that 
will be paid in fiscal year 2020.
    (c)  The Department shall notify each managed care 
organization of its annual fiscal year 2020 assessment and the 
installment due dates no later than 30 days prior to the first 
installment due date and the annual assessment and due dates 
for each subsequent year at least 30 days prior to the start of 
each fiscal year.
    (d)  Proceeds from the assessment levied pursuant to Section 
5H-3 shall be deposited into the Fund.
 
    (305 ILCS 5/5H-5 new)
    Sec. 5H-5. Liability or resultant entities.  In the event of 
a merger, acquisition, or any similar transaction involving 
entities subject to the assessment under this Article, the 
resultant entity shall be responsible for the full amount of 
the assessment for all entities involved in the transaction 
with the member months allotted to tiers as they were prior to 
the transaction and no member months shall change tiers as a 
result of any transaction. A managed care organization that 
ceases doing business in the State during any fiscal year shall 
be liable only for the monthly installments due in months that 
they operated in the State. The Department shall by rule 
establish a methodology to set the assessment base member 
months for a managed care organization that begins operating in 
the State at any time after 2018.  Nothing in this Section shall 
be construed to limit authority granted in subsection (c) of 
Section 5H-3. 
 
    (305 ILCS 5/5H-6 new)
    Sec. 5H-6. Recordkeeping; penalties.
    (a)  A managed care organization that is liable for the 
assessment under this Article shall keep accurate and complete 
records and pertinent documents as may be required by the 
Department. Records required by the Department shall be 
retained for a period of 4 years after the assessment imposed 
under this Act to which the records apply is due or as 
otherwise provided by law. The Department or the Department of 
Insurance may audit all records necessary to ensure compliance 
with this Article and make adjustments to assessment amounts 
previously calculated based on the results of any such audit.
    (b)  If a managed care organization fails to make a payment 
due under this Article in a timely fashion, they shall pay an 
additional penalty of 5% of the amount of the installment not 
paid on or before the due date, or any grace period granted, 
plus 5% of the portion thereof remaining unpaid on the last day 
of each 30-day period thereafter. The Department is authorized 
to grant grace periods of up to 30 days upon request of a 
managed care organization for good cause due to financial or 
other difficulties, as determined by the Department. If a 
managed care organization fails to make a payment within 60 
days after the due date the Department shall additionally 
impose a contractual sanction allowed against a Medicaid 
managed care organization and may terminate any such contract.  
The Department of Insurance shall take action against the 
certificate of authority of a non-Medicaid managed care 
organization that fails to pay an installment within 60 days 
after the due date.
 
    (305 ILCS 5/5H-7 new)
    Sec. 5H-7. Rulemaking.  The Department may by rule modify or 
make adjustments to any methodology, assessment amount, 
assessment  tier, or other similar provision specified in this 
Article, including broadening the tax base in subsection (a) of 
Section 5H-3, to the extent necessary to meet the requirements 
of federal law or regulations, obtain federal approval, or to 
ensure federal financial participation is available.  However, 
upward adjustments to Tier 3 rates shall be the minimum 
necessary to meet federal statistical tests to receive federal 
financial participation. The Department shall adopt rules to 
implement this Article under the Illinois Administrative 
Procedure Act.
 
    (305 ILCS 5/5H-8 new)
    Sec. 5H-8. Duties of the Department.
    (a)  The Department shall ensure that rates to Medicaid 
managed care organizations are actuarially sound including 
appropriate incorporation of assessments under this Article, 
other taxes and administrative expenses, including 
standardization of processes, and cost of medical care.
    (b)  The Department shall pay to each Medicaid managed care 
organization the amount required to be included in its rates 
due to the assessment under this Article in order to ensure 
actuarial soundness within 10 business days of receipt of each 
assessment payment from the Medicaid managed care 
organization.  The Department shall extend the deadline for any 
assessment payment due after the initial assessment payment if 
the payment to the managed care organizations under this 
subsection for the previous assessment payment has not been 
paid.  Such extension shall extend until 7 business days after 
receipt by the managed care organization of the late payment 
under this subsection.
    (c)  Reimbursement of assessments paid under this Article 
shall not be required to count as revenue towards any 
calculation of the managed care organization's medical loss 
ratio, net worth, risk based capital or other deposit 
requirements as may otherwise be required under the Insurance 
Code. Such  reimbursements will be considered revenue in 
calculating the 6% limit under 42 U.S.C. 433.68(f)(3).
    (d)  The Department shall include in its annual report, 
beginning with its fiscal year 2020 report, and every year 
thereafter, information on the revenues collected from this 
assessment, the federal funds drawn based on those revenues, 
the rates set in Section 5H-3 or any alterations thereof by 
administrative rule, and other impacts this gross revenue has 
had on the Medicaid program.
 
    Section 10-50. The Franchise Tax and License Fee Amnesty 
Act of 2007 is amended  by changing Section 5-10 as follows:
 
    (805 ILCS 8/5-10)

    Sec. 5-10. Amnesty program. The Secretary shall establish 
an amnesty program for all taxpayers owing any franchise tax or 
license fee imposed by Article XV of the Business Corporation 
Act of 1983. The amnesty program shall  be for a period from 
February 1, 2008 through March 15, 2008. The amnesty program 
shall also be for a period between October 1, 2019 and November 
15, 2019, and shall apply to franchise tax or license fee 
liabilities for any tax period ending after March 15, 2008 and 
on or before June 30, 2019. The amnesty program shall provide 
that, upon payment by a taxpayer of all franchise taxes and 
license fees due from that taxpayer to the State of Illinois 
for any taxable period, the Secretary shall abate and not seek 
to collect any interest or penalties  that may be applicable, 
and the Secretary shall not seek civil or criminal prosecution 
for any taxpayer for the period of time for which amnesty has 
been granted to the taxpayer. Failure to pay all taxes due to 
the State for a taxable period shall not invalidate any amnesty 
granted under this Act with respect to the taxes paid pursuant 
to the amnesty program. Amnesty shall be granted only if all 
amnesty conditions are satisfied by the taxpayer. Amnesty shall 
not be granted to taxpayers who are a party to any criminal 
investigation or to any civil or criminal litigation that is 
pending in any circuit court or appellate court or the Supreme 
Court of this State for nonpayment, delinquency, or fraud in 
relation to any franchise tax or license fee imposed by Article 
XV of the Business Corporation Act of 1983. Voluntary payments 
made under this Act shall be made by check, guaranteed 
remittance, or ACH debit. The Secretary shall adopt rules as 
necessary to implement the provisions of this Act. Except as 
otherwise provided in this Section, all money collected under 
this Act that would otherwise be deposited into the General 
Revenue Fund shall be deposited into the General Revenue Fund. 
Two percent of all money collected under this Act shall be 
deposited by the State Treasurer into the Franchise Tax and 
License Fee Amnesty Administration Fund and, subject to 
appropriation, shall be used by the Secretary to cover costs 
associated with the administration of this Act.

(Source: P.A. 95-233, eff. 8-16-07; 95-707, eff. 1-11-08.)
 
ARTICLE 20.   BLUE COLLAR JOBS ACT

 
    Section 20-1. This Act may be referred to as the Blue 
Collar Jobs Act.
 
    Section 20-5. The Illinois Enterprise Zone Act is amended  
by changing Section 5.5 and  by adding Section 13 as follows:
 



    (20 ILCS 655/5.5)
  (from Ch. 67 1/2, par. 609.1)



    Sec. 5.5. High Impact Business. 

    (a) In order to respond to unique opportunities to assist 
in the
encouragement, development, growth and expansion of the 
private sector through
large scale investment and development 
projects, the Department is authorized
to receive and approve 
applications for the designation of "High Impact
Businesses" in 
Illinois subject to the following conditions:


        (1) such applications may be submitted at any time 
    during the year;


        (2) such business is not located, at the time of 
    designation, in
an enterprise zone designated pursuant to 
    this Act;


        (3) the business intends to do one or more of the 
    following:

            (A) the business intends to make a minimum 
        investment of
$12,000,000 which will be placed in 
        service in qualified property and
intends to create 500 
        full-time equivalent jobs at a designated location
in 
        Illinois or intends to make a minimum investment of 
        $30,000,000 which
will be placed in service in 
        qualified property and intends to retain 1,500

        full-time retained jobs at a designated location in 
        Illinois.
The business must certify in writing that the 
        investments would not be
placed in service in qualified 
        property and the job creation or job
retention would 
        not occur without the tax credits and exemptions set 
        forth
in subsection (b) of this Section. The terms 
        "placed in service" and
"qualified property" have the 
        same meanings as described in subsection (h)
of Section 
        201 of the Illinois Income Tax Act; or


            (B) the business intends to establish a new 
        electric generating
facility at a designated location 
        in Illinois.  "New electric generating
facility", for 
        purposes of this Section, means a newly-constructed

        electric
generation plant
or a newly-constructed 
        generation capacity expansion at an existing electric

        generation
plant, including the transmission lines and 
        associated
equipment that transfers electricity from 
        points of supply to points of
delivery, and for which 
        such new foundation construction commenced not sooner

        than July 1,
2001.  Such facility shall be designed to 
        provide baseload electric
generation and shall operate 
        on a continuous basis throughout the year;
and (i) 
        shall have an aggregate rated generating capacity of at 
        least 1,000
megawatts for all new units at one site if 
        it uses natural gas as its primary
fuel and foundation 
        construction of the facility is commenced on
or before 
        December 31, 2004, or shall have an aggregate rated 
        generating
capacity of at least 400 megawatts for all 
        new units at one site if it uses
coal or gases derived 
        from coal
as its primary fuel and
shall support the 
        creation of at least 150 new Illinois coal mining jobs, 
        or
(ii) shall be funded through a federal Department of 
        Energy grant before December 31, 2010 and shall support 
        the creation of Illinois
coal-mining
jobs, or (iii) 
        shall use coal gasification or integrated 
        gasification-combined cycle units
that generate

        electricity or chemicals, or both, and shall support 
        the creation of Illinois
coal-mining
jobs.
The

        business must certify in writing that the investments 
        necessary to establish
a new electric generating 
        facility would not be placed in service and the
job 
        creation in the case of a coal-fueled plant
would not 
        occur without the tax credits and exemptions set forth 
        in
subsection (b-5) of this Section.  The term "placed 
        in service" has
the same meaning as described in 
        subsection
(h) of Section 201 of the Illinois Income 
        Tax Act; or

            (B-5) the business intends to establish a new 
        gasification
facility at a designated location in 
        Illinois.  As used in this Section, "new gasification 
        facility" means a newly constructed coal gasification 
        facility that generates chemical feedstocks or 
        transportation fuels derived from coal (which may 
        include, but are not limited to, methane, methanol, and 
        nitrogen fertilizer), that supports the creation or 
        retention of Illinois coal-mining jobs, and that 
        qualifies for financial assistance from the Department 
        before December 31, 2010. A new gasification facility 
        does not include a pilot project located within 
        Jefferson County or within a county adjacent to 
        Jefferson County for synthetic natural gas from coal; 
        or

            (C) the business intends to establish
production 
        operations at a new coal mine, re-establish production 
        operations at
a closed coal mine, or expand production 
        at an existing coal mine
at a designated location in 
        Illinois not sooner than July 1, 2001;
provided that 
        the
production operations result in the creation of 150 
        new Illinois coal mining
jobs as described in 
        subdivision (a)(3)(B) of this Section, and further

        provided that the coal extracted from such mine is 
        utilized as the predominant
source for a new electric 
        generating facility.
The business must certify in 
        writing that the
investments necessary to establish a 
        new, expanded, or reopened coal mine would
not
be 
        placed in service and the job creation would not
occur 
        without the tax credits and exemptions set forth in 
        subsection (b-5) of
this Section.  The term "placed in 
        service" has
the same meaning as described in 
        subsection (h) of Section 201 of the
Illinois Income 
        Tax Act; or


            (D) the business intends to construct new 
        transmission facilities or
upgrade existing 
        transmission facilities at designated locations in 
        Illinois,
for which construction commenced not sooner 
        than July 1, 2001.  For the
purposes of this Section, 
        "transmission facilities" means transmission lines

        with a voltage rating of 115 kilovolts or above, 
        including associated
equipment, that transfer 
        electricity from points of supply to points of
delivery 
        and that transmit a majority of the electricity 
        generated by a new
electric generating facility 
        designated as a High Impact Business in accordance
with 
        this Section.  The business must certify in writing that 
        the investments
necessary to construct new 
        transmission facilities or upgrade existing

        transmission facilities would not be placed in service

        without the tax credits and exemptions set forth in 
        subsection (b-5) of this
Section.  The term "placed in 
        service" has the
same meaning as described in 
        subsection (h) of Section 201 of the Illinois
Income 
        Tax Act; or

            (E)  the business intends to establish a new wind 
        power facility at a designated location in Illinois.  
        For purposes of this Section, "new wind power facility" 
        means a newly constructed electric generation 
        facility, or a newly constructed expansion of an 
        existing electric generation facility, placed in 
        service on or after July 1, 2009, that generates 
        electricity using wind energy devices, and such 
        facility shall be deemed to include all associated 
        transmission lines, substations, and other equipment 
        related to the generation of electricity from wind 
        energy devices.  For purposes of this Section, "wind 
        energy device" means any device, with a nameplate 
        capacity of at least 0.5 megawatts, that is used in the 
        process of converting kinetic energy from the wind to 
        generate electricity; or 
            (F)  the business commits to (i)  make a minimum 
        investment of $500,000,000, which will be placed in 
        service in a qualified property, (ii) create 125  
        full-time equivalent jobs at a designated location in 
        Illinois, (iii) establish a fertilizer plant at a 
        designated location in Illinois that complies with the 
        set-back standards as described in Table 1: Initial 
        Isolation and Protective Action Distances  in the 2012 
        Emergency Response Guidebook published by the United 
        States Department of Transportation, (iv) pay a 
        prevailing wage for employees at that location who are 
        engaged in construction activities, and (v) secure an 
        appropriate level of general liability insurance to 
        protect against catastrophic failure of the fertilizer 
        plant or any of its constituent systems; in addition, 
        the business must agree to enter into a construction 
        project labor agreement including provisions 
        establishing wages, benefits, and other compensation 
        for employees performing work under the project labor 
        agreement at that location;  for the purposes of this 
        Section, "fertilizer plant" means a newly constructed 
        or upgraded plant utilizing gas used in the production 
        of anhydrous ammonia and downstream nitrogen 
        fertilizer products for resale; for the purposes of 
        this Section, "prevailing wage" means the hourly cash 
        wages plus fringe benefits for training and

        apprenticeship programs approved by the U.S. 
        Department of Labor, Bureau of
Apprenticeship and 
        Training, health and welfare, insurance, vacations and

        pensions paid generally, in the
locality in which the 
        work is being performed, to employees engaged in
work 
        of a similar character on public works; this paragraph 
        (F) applies only to businesses that submit an 
        application to the Department within 60 days after the 
        effective date of this amendatory Act of the 98th 
        General Assembly;  and 

        (4) no later than 90 days after an application is 
    submitted, the
Department shall notify the applicant of the 
    Department's determination of
the qualification of the 
    proposed High Impact Business under this Section.

    (b) Businesses designated as High Impact Businesses 
pursuant to
subdivision (a)(3)(A) of this Section shall qualify 
for the credits and
exemptions described in the
following Acts: 
Section 9-222 and Section 9-222.1A of the Public Utilities
Act,

subsection (h)
of Section 201 of the Illinois Income Tax Act,

and Section 1d of
the
Retailers' Occupation Tax Act; provided 
that these credits and
exemptions
described in these Acts shall 
not be authorized until the minimum
investments set forth in 
subdivision (a)(3)(A) of this
Section have been placed in

service in qualified properties and, in the case of the 
exemptions
described in the Public Utilities Act and Section 1d 
of the Retailers'
Occupation Tax Act, the minimum full-time 
equivalent jobs or full-time retained jobs set
forth in 
subdivision (a)(3)(A) of this Section have been
created or 
retained.
Businesses designated as High Impact Businesses 
under
this Section shall also
qualify for the exemption 
described in Section 5l of the Retailers' Occupation
Tax Act. 
The credit provided in subsection (h) of Section 201 of the 
Illinois
Income Tax Act shall be applicable to investments in 
qualified property as set
forth in subdivision (a)(3)(A) of 
this Section.

    (b-5) Businesses designated as High Impact Businesses 
pursuant to
subdivisions (a)(3)(B), (a)(3)(B-5), (a)(3)(C), 
and (a)(3)(D) of this Section shall qualify
for the credits and 
exemptions described in the following Acts:  Section 51 of
the 
Retailers' Occupation Tax Act, Section 9-222 and Section 
9-222.1A of the
Public Utilities Act, and subsection (h) of 
Section 201 of the Illinois Income
Tax Act; however, the 
credits and exemptions authorized under Section 9-222 and

Section 9-222.1A of the Public Utilities Act, and subsection 
(h) of Section 201
of the Illinois Income Tax Act shall not be 
authorized until the new electric
generating facility, the new 
gasification facility, the new transmission facility, or the 
new, expanded, or
reopened coal mine is operational,
except 
that a new electric generating facility whose primary fuel 
source is
natural gas is eligible only for the exemption under 
Section 5l of the
Retailers' Occupation Tax Act.

    (b-6) Businesses designated as High Impact Businesses 
pursuant to subdivision (a)(3)(E) of this Section shall qualify 
for the exemptions described in Section 5l of the Retailers' 
Occupation Tax Act; any business so designated as a High Impact 
Business being, for purposes of this Section, a "Wind Energy 
Business". 
    (b-7) Beginning on January 1, 2021, businesses designated 
as High Impact Businesses by the Department shall qualify for 
the High Impact Business construction jobs credit under 
subsection (h-5) of Section 201 of the Illinois Income Tax Act 
if the business meets the criteria set forth in subsection (i) 
of this Section. The total aggregate amount of credits awarded 
under the Blue Collar Jobs Act (Article 20 of this amendatory 
Act of the 101st General Assembly) shall not exceed $20,000,000 
in any State fiscal year. 
    (c) High Impact Businesses located in federally designated 
foreign trade
zones or sub-zones are also eligible for 
additional credits, exemptions and
deductions as described in 
the following Acts: Section 9-221 and Section
9-222.1 of the 
Public
Utilities Act; and subsection (g) of Section 201, and 
Section 203
of the Illinois Income Tax Act.

    (d) Except for businesses contemplated under subdivision 
(a)(3)(E) of this Section, existing Illinois businesses which 
apply for designation as a
High Impact Business must provide 
the Department with the prospective plan
for which 1,500 
full-time retained jobs would be eliminated in the event that 
the
business is not designated.

    (e) Except for new wind power facilities contemplated under 
subdivision (a)(3)(E) of this Section, new proposed facilities 
which apply for designation as High Impact
Business must 
provide the Department with proof of alternative non-Illinois

sites which would receive the proposed investment and job 
creation in the
event that the business is not designated as a 
High Impact Business.

    (f) Except for businesses contemplated under subdivision 
(a)(3)(E) of this Section, in the event that a business is 
designated a High Impact Business
and it is later determined 
after reasonable notice and an opportunity for a
hearing as 
provided under the Illinois Administrative Procedure Act, that

the business would have placed in service in qualified property 
the
investments and created or retained the requisite number of 
jobs without
the benefits of the High Impact Business 
designation, the Department shall
be required to immediately 
revoke the designation and notify the Director
of the 
Department of Revenue who shall begin proceedings to recover 
all
wrongfully exempted State taxes with interest.  The business 
shall also be
ineligible for all State funded Department 
programs for a period of 10 years.

    (g) The Department shall revoke a High Impact Business 
designation if
the participating business fails to comply with 
the terms and conditions of
the designation. However, the 
penalties for new wind power facilities or Wind Energy 
Businesses for failure to comply with any of the terms or 
conditions of the Illinois Prevailing Wage Act shall be only 
those penalties identified in the Illinois Prevailing Wage Act, 
and the Department shall not revoke a High Impact Business 
designation as a result of the failure to comply with any of 
the terms or conditions of the Illinois Prevailing Wage Act in 
relation to a new wind power facility or a Wind Energy 
Business. 

    (h) Prior to designating a business, the Department shall 
provide the
members of the General Assembly and Commission on 
Government Forecasting and Accountability
with a report 
setting forth the terms and conditions of the designation and

guarantees that have been received by the Department in 
relation to the
proposed business being designated.

    (i) High Impact Business construction jobs credit. 
Beginning on January 1, 2021, a High Impact Business may 
receive a tax credit against the tax imposed under subsections 
(a) and (b) of Section 201 of the Illinois Income Tax Act in an 
amount equal to 50% of the amount of the incremental income tax 
attributable to High Impact Business construction jobs credit 
employees employed in the course of completing a High Impact 
Business construction jobs project. However, the High Impact 
Business construction jobs credit may equal 75% of the amount 
of the incremental income tax attributable to High Impact 
Business construction jobs credit employees if the High Impact 
Business construction jobs credit project is located in an 
underserved area. 
    The Department shall certify to the Department of Revenue: 
(1) the identity of taxpayers that are eligible for the High 
Impact Business construction jobs credit; and (2) the amount of 
High Impact Business construction jobs credits that are claimed 
pursuant to subsection (h-5) of Section 201 of the Illinois 
Income Tax Act in each taxable year.  Any business entity that 
receives a High Impact Business construction jobs credit shall 
maintain a certified payroll pursuant to subsection (j) of this 
Section. 
    As used in this subsection (i):
    "High Impact Business construction jobs credit" means an 
amount equal to 50% (or 75% if the High Impact Business 
construction project is located in an underserved area) of the 
incremental income tax attributable to High Impact Business 
construction job employees. The total aggregate amount of 
credits awarded under the Blue Collar Jobs Act (Article 20 of 
this amendatory Act of the 101st General Assembly) shall not 
exceed $20,000,000 in any State fiscal year
    "High Impact Business construction job employee" means a 
laborer or worker who is employed by an Illinois contractor or 
subcontractor in the actual construction work on the site of a 
High Impact Business construction job project.
    "High Impact Business construction jobs project" means 
building a structure or building or making improvements of any 
kind to real property, undertaken and commissioned by a 
business that was designated as a High Impact Business by the 
Department. The term "High  Impact Business construction jobs 
project" does not include the routine operation, routine 
repair, or routine maintenance of existing structures, 
buildings, or real property.
    "Incremental income tax" means the total amount withheld 
during the taxable year from the compensation of High Impact 
Business construction job employees.
    "Underserved area" means a geographic area that meets one 
or more of the following conditions:
        (1) the area has a poverty rate of at least 20% 
    according to the latest federal decennial census; 
        (2) 75% or more of the children in the area participate 
    in the federal free lunch program according to reported 
    statistics from the State Board of Education; 
        (3) at least 20% of the households in the area receive 
    assistance under the Supplemental Nutrition Assistance 
    Program (SNAP); or 
        (4) the area has an average unemployment rate, as 
    determined by the Illinois Department of Employment 
    Security, that is more than 120% of the national 
    unemployment average, as determined by the U.S. Department 
    of Labor, for a period of at least 2 consecutive calendar 
    years preceding the date of the application. 
    (j) Each contractor and subcontractor who is engaged in and 
executing a High Impact Business Construction jobs project, as 
defined under subsection (i) of this Section, for a business 
that is entitled to a credit pursuant to subsection (i) of this 
Section shall: 
        (1) make and keep, for a period of 5 years from the 
    date of the last payment made on or after the effective 
    date of this amendatory Act of the 101st General Assembly 
    on a contract or subcontract for a High Impact Business 
    Construction Jobs Project, records for all laborers and 
    other workers employed by the contractor or subcontractor 
    on the project; the records shall include: 
            (A) the worker's name; 
            (B) the worker's address; 
            (C) the worker's telephone number, if available; 
            (D) the worker's social security number; 
            (E) the worker's classification or 
        classifications; 
            (F) the worker's gross and net wages paid in each 
        pay period; 
            (G) the worker's number of hours worked each day; 
            (H) the worker's starting and ending times of work 
        each day; 
            (I) the worker's hourly wage rate; and 
            (J) the worker's hourly overtime wage rate; 
        (2) no later than the 15th day of each calendar month, 
    provide a certified payroll for the immediately preceding 
    month to the taxpayer in charge of the High Impact Business 
    construction jobs project; within 5 business days after 
    receiving the certified payroll, the taxpayer shall file 
    the certified payroll with the Department of Labor and the 
    Department of Commerce and Economic Opportunity; a 
    certified payroll must be filed for only those calendar 
    months during which construction on a High Impact Business 
    construction jobs project has occurred; the certified 
    payroll shall consist of a complete copy of the records 
    identified in paragraph (1) of this subsection (j), but may 
    exclude the starting and ending times of work each day; the 
    certified payroll shall be accompanied by a statement 
    signed by the contractor or subcontractor or an officer, 
    employee, or agent of the contractor or subcontractor which 
    avers that: 
            (A) he or she has examined the certified payroll 
        records required to be submitted by the Act and such 
        records are true and accurate; and 
            (B) the contractor or subcontractor is aware that 
        filing a certified payroll that he or she knows to be 
        false is a Class A misdemeanor. 
    A general contractor is not prohibited from relying on a 
certified payroll of a lower-tier subcontractor, provided the 
general contractor does not knowingly rely upon a 
subcontractor's false certification. 
    Any contractor or subcontractor subject to this 
subsection, and any officer, employee, or agent of such 
contractor or subcontractor whose duty as an officer, employee, 
or agent it is to file a certified payroll under this 
subsection, who willfully fails to file such a certified 
payroll on or before the date such certified payroll is 
required by this paragraph to be filed and any person who 
willfully files a false certified payroll that is false as to 
any material fact is in violation of this Act and guilty of a 
Class A misdemeanor. 
    The taxpayer in charge of the project shall keep the 
records submitted in accordance with this subsection on or 
after the effective date of this amendatory Act of the 101st 
General Assembly for a period of 5 years from the date of the 
last payment for work on a contract or subcontract for the High 
Impact Business construction jobs project. 
    The records submitted in accordance with this subsection 
shall be considered public records, except an employee's 
address, telephone number, and social security number, and made 
available in accordance with the Freedom of Information Act. 
The Department of Labor shall accept any reasonable submissions 
by the contractor that meet the requirements of this subsection 
(j) and shall share the information with the Department in 
order to comply with the awarding of a High Impact Business 
construction jobs credit. A contractor, subcontractor, or 
public body may retain records required under this Section in 
paper or electronic format. 
    (k) Upon 7 business days' notice, each contractor and 
subcontractor shall make available for inspection and copying 
at a location within this State during reasonable hours, the 
records identified in this subsection (j) to the taxpayer in 
charge of the High Impact Business construction jobs project, 
its officers and agents, the Director of the Department of 
Labor and his deputies and agents, and to federal, State, or 
local law enforcement agencies and prosecutors. 
(Source: P.A. 97-905, eff. 8-7-12; 98-109, eff. 7-25-13.)

 
    (20 ILCS 655/13 new)
    Sec. 13. Enterprise Zone construction jobs credit.
    (a) Beginning on January 1, 2021, a business entity in a 
certified Enterprise Zone that makes a capital investment of at 
least $10,000,000 in an Enterprise Zone construction jobs 
project may receive an Enterprise Zone construction jobs credit 
against the tax imposed under subsections (a) and (b) of 
Section 201 of the Illinois Income Tax Act in an amount equal 
to 50% of the amount of the incremental income tax attributable 
to Enterprise Zone construction jobs credit employees employed 
in the course of completing an Enterprise Zone construction 
jobs project. However, the Enterprise Zone construction jobs 
credit may equal 75% of the amount of the incremental income 
tax attributable to Enterprise Zone construction jobs credit 
employees if the project is located in an underserved area. 
    (b) A business entity seeking a credit under this Section 
must submit an application to the Department and must receive 
approval from the designating municipality or county and the 
Department for the Enterprise Zone construction jobs credit 
project. The application must describe the nature and benefit 
of the project to the certified Enterprise Zone and its 
potential contributors. The total aggregate amount of credits 
awarded under the Blue Collar Jobs Act (Article 20 of this 
amendatory Act of the 101st General Assembly) shall not exceed 
$20,000,000 in any State fiscal year. 
    Within 45 days after receipt of an application, the 
Department shall give notice to the applicant as to whether the 
application has been approved or disapproved. If the Department 
disapproves the application, it shall specify the reasons for 
this decision and allow 60 days for the applicant to amend and 
resubmit its application. The Department shall provide 
assistance upon request to applicants. Resubmitted 
applications shall receive the Department's approval or 
disapproval within 30 days after the application is 
resubmitted. Those resubmitted applications satisfying initial 
Department objectives shall be approved unless reasonable 
circumstances warrant disapproval. 
    On an annual basis, the designated zone organization shall 
furnish a statement to the Department on the programmatic and 
financial status of any approved project and an audited 
financial statement of the project. 
    The Department shall certify to the Department of Revenue 
the identity of taxpayers who are eligible for the credits and 
the amount of credits that are claimed pursuant to subparagraph 
(8) of subsection (f) of Section 201 the Illinois Income Tax 
Act. 
    The Enterprise Zone construction jobs credit project must 
be undertaken by the business entity in the course of 
completing a project that complies with the criteria contained 
in Section 4 of this Act and is undertaken in a certified 
Enterprise Zone. The Department shall adopt any necessary rules 
for the implementation of this  subsection (b). 
    (c) Any business entity that receives an Enterprise Zone 
construction jobs credit shall maintain a certified payroll 
pursuant to subsection (d) of this Section. 
    (d) Each contractor and subcontractor who is engaged in and 
is executing an Enterprise Zone Construction jobs credit 
project for a business that is entitled to a credit pursuant to 
this Section shall: 
        (1) make and keep, for a period of 5 years from the 
    date of the last payment made on or after the effective 
    date of this amendatory Act of the 101st General Assembly 
    on a contract or subcontract for an Enterprise Zone 
    construction jobs credit project, records for all laborers 
    and other workers employed by them on the project; the 
    records shall include: 
            (A) the worker's name; 
            (B) the worker's address; 
            (C) the worker's telephone number, if available; 
            (D) the worker's social security number; 
            (E) the worker's classification or 
        classifications; 
            (F) the worker's gross and net wages paid in each 
        pay period; 
            (G) the worker's number of hours worked each day; 
            (H) the worker's starting and ending times of work 
        each day; 
            (I) the worker's hourly wage rate; and 
            (J) the worker's hourly overtime wage rate; 
        (2) no later than the 15th day of each calendar month, 
    provide a certified payroll for the immediately preceding 
    month to the taxpayer in charge of the project; within 5 
    business days after receiving the certified payroll, the 
    taxpayer shall file the certified payroll with the 
    Department of Labor and the Department of Commerce and 
    Economic Opportunity; a certified payroll must be filed for 
    only those calendar months during which construction on an 
    Enterprise Zone construction jobs project has occurred; 
    the certified payroll shall consist of a complete copy of 
    the records identified in paragraph (1) of this subsection 
    (d), but may exclude the starting and ending times of work 
    each day; the certified payroll shall be accompanied by a 
    statement signed by the contractor or subcontractor or an 
    officer, employee, or agent of the contractor or 
    subcontractor which avers that: 
            (A) he or she has examined the certified payroll 
        records required to be submitted by the Act and such 
        records are true and accurate; and 
            (B) the contractor or subcontractor is aware that 
        filing a certified payroll that he or she knows to be 
        false is a Class A misdemeanor. 
    A general contractor is not prohibited from relying on a 
certified payroll of a lower-tier subcontractor, provided the 
general contractor does not knowingly rely upon a 
subcontractor's false certification. 
    Any contractor or subcontractor subject to this 
subsection, and any officer, employee, or agent of such 
contractor or subcontractor whose duty as an officer, employee, 
or agent it is to file a certified payroll under this 
subsection, who willfully fails to file such a certified 
payroll on or before the date such certified payroll is 
required by this paragraph to be filed and any person who 
willfully files a false certified payroll that is false as to 
any material fact is in violation of this Act and guilty of a 
Class A misdemeanor. 
    The taxpayer in charge of the project shall keep the 
records submitted in accordance with this subsection on or 
after the effective date of this amendatory Act of the 101st 
General Assembly for a period of 5 years from the date of the 
last payment for work on a contract or subcontract for the 
project. 
    The records submitted in accordance with this subsection 
shall be considered public records, except an employee's 
address, telephone number, and social security number, and made 
available in accordance with the Freedom of Information Act. 
The Department of Labor shall accept any reasonable submissions 
by the contractor that meet the requirements of this subsection 
and shall share the information with the Department in order to 
comply with the awarding of Enterprise Zone construction jobs 
credits. A contractor, subcontractor, or public body may retain 
records required under this Section in paper or electronic 
format. 
    Upon 7 business days' notice, the contractor and each 
subcontractor shall make available for inspection and copying 
at a location within this State during reasonable hours, the 
records identified in paragraph (1) of this subsection to the 
taxpayer in charge of the project, its officers and agents, the 
Director of Labor and his deputies and agents, and to federal, 
State, or local law enforcement agencies and prosecutors. 
    (e) As used in this Section: 
    "Enterprise Zone construction jobs credit" means an amount 
equal to 50% (or 75% if the project is located in an 
underserved area) of the incremental income tax attributable to 
Enterprise Zone construction jobs credit employees. 
    "Enterprise Zone construction jobs credit employee" means 
a laborer or worker who is employed by an Illinois contractor 
or subcontractor in the actual construction work on the site of 
an Enterprise Zone construction jobs credit project. 
    "Enterprise Zone construction jobs credit project" means 
building a structure or building or making improvements of any 
kind to real property commissioned and paid for by a business 
that has applied and been approved for an Enterprise Zone 
construction jobs credit pursuant to this Section. "Enterprise 
Zone construction jobs credit project" does not include the 
routine operation, routine repair, or routine maintenance of 
existing structures, buildings, or real property. 
    "Incremental income tax" means the total amount withheld 
during the taxable year from the compensation of Enterprise 
Zone construction jobs credit employees. 
    "Underserved area" means a geographic area that meets one 
or more of the following conditions:
        (1) the area has a poverty rate of at least 20% 
    according to the latest federal decennial census; 
        (2) 75% or more of the children in the area participate 
    in the federal free lunch program according to reported 
    statistics from the State Board of Education; 
        (3) at least 20% of the households in the area receive 
    assistance under the Supplemental Nutrition Assistance 
    Program (SNAP); or 
        (4) the area has an average unemployment rate, as 
    determined by the Illinois Department of Employment 
    Security, that is more than 120% of the national 
    unemployment average, as determined by the U.S. Department 
    of Labor, for a period of at least 2 consecutive calendar 
    years preceding the date of the application. 
 
    Section 20-10. The Illinois Income Tax Act is amended  by 
changing Sections 201, 211, and 221 as follows:
 
    (35 ILCS 5/201)  (from Ch. 120, par. 2-201)
    Sec. 201. Tax imposed. 
    (a) In general.  A tax measured by net income is hereby 
imposed on every
individual, corporation, trust and estate for 
each taxable year ending
after July 31, 1969 on the privilege 
of earning or receiving income in or
as a resident of this 
State. Such tax shall be in addition to all other
occupation or 
privilege taxes imposed by this State or by any municipal

corporation or political subdivision thereof.
    (b) Rates.  The tax imposed by subsection (a) of this 
Section shall be
determined as follows, except as adjusted by 
subsection (d-1):
        (1) In the case of an individual, trust or estate, for 
    taxable years
ending prior to July 1, 1989, an amount equal 
    to 2 1/2% of the taxpayer's
net income for the taxable 
    year.
        (2) In the case of an individual, trust or estate, for 
    taxable years
beginning prior to July 1, 1989 and ending 
    after June 30, 1989, an amount
equal to the sum of (i) 2 
    1/2% of the taxpayer's net income for the period
prior to 
    July 1, 1989, as calculated under Section 202.3, and (ii) 
    3% of the
taxpayer's net income for the period after June 
    30, 1989, as calculated
under Section 202.3.
        (3) In the case of an individual, trust or estate, for 
    taxable years
beginning after June 30, 1989, and ending 
    prior to January 1, 2011, an amount equal to 3% of the 
    taxpayer's net
income for the taxable year.
        (4) In the case of an individual, trust, or estate, for 
    taxable years beginning prior to January 1, 2011, and 
    ending after December 31, 2010, an amount equal to the sum 
    of (i) 3% of the taxpayer's net income for the period prior 
    to January 1, 2011, as calculated under Section 202.5, and 
    (ii) 5% of the taxpayer's net income for the period after 
    December 31, 2010, as calculated under Section 202.5.
        (5) In the case of an individual, trust, or estate, for 
    taxable years beginning on or after January 1, 2011, and 
    ending prior to January 1, 2015, an amount equal to 5% of 
    the taxpayer's net income for the taxable year.
        (5.1) In the case of an individual, trust, or estate, 
    for taxable years beginning prior to January 1, 2015, and 
    ending after December 31, 2014, an amount equal to the sum 
    of (i) 5% of the taxpayer's net income for the period prior 
    to January 1, 2015, as calculated under Section 202.5, and 
    (ii) 3.75% of the taxpayer's net income for the period 
    after December 31, 2014, as calculated under Section 202.5. 
        (5.2) In the case of an individual, trust, or estate, 
    for taxable years beginning on or after January 1, 2015, 
    and ending prior to July 1, 2017, an amount equal to 3.75% 
    of the taxpayer's net income for the taxable year. 
        (5.3) In the case of an individual, trust, or estate, 
    for taxable years beginning prior to July 1, 2017, and 
    ending after June 30, 2017, an amount equal to the sum of 
    (i) 3.75% of the taxpayer's net income for the period prior 
    to July 1, 2017, as calculated under Section 202.5, and 
    (ii) 4.95% of the taxpayer's net income for the period 
    after June 30, 2017, as calculated under Section 202.5. 
        (5.4) In the case of an individual, trust, or estate, 
    for taxable years beginning on or after July 1, 2017, an 
    amount equal to 4.95% of the taxpayer's net income for the 
    taxable year. 
        (6) In the case of a corporation, for taxable years

    ending prior to July 1, 1989, an amount equal to 4% of the

    taxpayer's net income for the taxable year.
        (7) In the case of a corporation, for taxable years 
    beginning prior to
July 1, 1989 and ending after June 30, 
    1989, an amount equal to the sum of
(i) 4% of the 
    taxpayer's net income for the period prior to July 1, 1989,

    as calculated under Section 202.3, and (ii) 4.8% of the 
    taxpayer's net
income for the period after June 30, 1989, 
    as calculated under Section
202.3.
        (8) In the case of a corporation, for taxable years 
    beginning after
June 30, 1989, and ending prior to January 
    1, 2011, an amount equal to 4.8% of the taxpayer's net 
    income for the
taxable year.
        (9) In the case of a corporation, for taxable years 
    beginning prior to January 1, 2011, and ending after 
    December 31, 2010, an amount equal to the sum of (i) 4.8% 
    of the taxpayer's net income for the period prior to 
    January 1, 2011, as calculated under Section 202.5, and 
    (ii) 7% of the taxpayer's net income for the period after 
    December 31, 2010, as calculated under Section 202.5. 
        (10) In the case of a corporation, for taxable years 
    beginning on or after January 1, 2011, and ending prior to 
    January 1, 2015, an amount equal to 7% of the taxpayer's 
    net income for the taxable year. 
        (11) In the case of a corporation, for taxable years 
    beginning prior to January 1, 2015, and ending after 
    December 31, 2014, an amount equal to the sum of (i) 7% of 
    the taxpayer's net income for the period prior to January 
    1, 2015, as calculated under Section 202.5, and (ii) 5.25% 
    of the taxpayer's net income for the period after December 
    31, 2014, as calculated under Section 202.5. 
        (12) In the case of a corporation, for taxable years 
    beginning on or after January 1, 2015, and ending prior to 
    July 1, 2017, an amount equal to 5.25% of the taxpayer's 
    net income for the taxable year. 
        (13) In the case of a corporation, for taxable years 
    beginning prior to July 1, 2017, and ending after June 30, 
    2017, an amount equal to the sum of (i) 5.25% of the 
    taxpayer's net income for the period prior to July 1, 2017, 
    as calculated under Section 202.5, and (ii) 7% of the 
    taxpayer's net income for the period after June 30, 2017, 
    as calculated under Section 202.5. 
        (14) In the case of a corporation, for taxable years 
    beginning on or after July 1, 2017, an amount equal to 7% 
    of the taxpayer's net income for the taxable year. 
    The rates under this subsection (b) are subject to the 
provisions of Section 201.5. 
    (c) Personal Property Tax Replacement Income Tax.

Beginning on July 1, 1979 and thereafter, in addition to such 
income
tax, there is also hereby imposed the Personal Property 
Tax Replacement
Income Tax measured by net income on every 
corporation (including Subchapter
S corporations), partnership 
and trust, for each taxable year ending after
June 30, 1979.  
Such taxes are imposed on the privilege of earning or
receiving 
income in or as a resident of this State.  The Personal Property

Tax Replacement Income Tax shall be in addition to the income 
tax imposed
by subsections (a) and (b) of this Section and in 
addition to all other
occupation or privilege taxes imposed by 
this State or by any municipal
corporation or political 
subdivision thereof.
    (d) Additional Personal Property Tax Replacement Income 
Tax Rates.
The personal property tax replacement income tax 
imposed by this subsection
and subsection (c) of this Section 
in the case of a corporation, other
than a Subchapter S 
corporation and except as adjusted by subsection (d-1),
shall 
be an additional amount equal to
2.85% of such taxpayer's net 
income for the taxable year, except that
beginning on January 
1, 1981, and thereafter, the rate of 2.85% specified
in this 
subsection shall be reduced to 2.5%, and in the case of a

partnership, trust or a Subchapter S corporation shall be an 
additional
amount equal to 1.5% of such taxpayer's net income 
for the taxable year.
    (d-1) Rate reduction for certain foreign insurers.  In the 
case of a
foreign insurer, as defined by Section 35A-5 of the 
Illinois Insurance Code,
whose state or country of domicile 
imposes on insurers domiciled in Illinois
a retaliatory tax 
(excluding any insurer
whose premiums from reinsurance assumed 
are 50% or more of its total insurance
premiums as determined 
under paragraph (2) of subsection (b) of Section 304,
except 
that for purposes of this determination premiums from 
reinsurance do
not include premiums from inter-affiliate 
reinsurance arrangements),
beginning with taxable years ending 
on or after December 31, 1999,
the sum of
the rates of tax 
imposed by subsections (b) and (d) shall be reduced (but not

increased) to the rate at which the total amount of tax imposed 
under this Act,
net of all credits allowed under this Act, 
shall equal (i) the total amount of
tax that would be imposed 
on the foreign insurer's net income allocable to
Illinois for 
the taxable year by such foreign insurer's state or country of

domicile if that net income were subject to all income taxes 
and taxes
measured by net income imposed by such foreign 
insurer's state or country of
domicile, net of all credits 
allowed or (ii) a rate of zero if no such tax is
imposed on such 
income by the foreign insurer's state of domicile.
For the 
purposes of this subsection (d-1), an inter-affiliate includes 
a
mutual insurer under common management.
        (1) For the purposes of subsection (d-1), in no event 
    shall the sum of the
rates of tax imposed by subsections 
    (b) and (d) be reduced below the rate at
which the sum of:
            (A) the total amount of tax imposed on such foreign 
        insurer under
this Act for a taxable year, net of all 
        credits allowed under this Act, plus
            (B) the privilege tax imposed by Section 409 of the 
        Illinois Insurance
Code, the fire insurance company 
        tax imposed by Section 12 of the Fire
Investigation 
        Act, and the fire department taxes imposed under 
        Section 11-10-1
of the Illinois Municipal Code,
    equals 1.25% for taxable years ending prior to December 31, 
    2003, or
1.75% for taxable years ending on or after 
    December 31, 2003, of the net
taxable premiums written for 
    the taxable year,
as described by subsection (1) of Section 
    409 of the Illinois Insurance Code.
This paragraph will in 
    no event increase the rates imposed under subsections
(b) 
    and (d).
        (2) Any reduction in the rates of tax imposed by this 
    subsection shall be
applied first against the rates imposed 
    by subsection (b) and only after the
tax imposed by 
    subsection (a) net of all credits allowed under this 
    Section
other than the credit allowed under subsection (i) 
    has been reduced to zero,
against the rates imposed by 
    subsection (d).
    This subsection (d-1) is exempt from the provisions of 
Section 250.
    (e) Investment credit.  A taxpayer shall be allowed a credit

against the Personal Property Tax Replacement Income Tax for

investment in qualified property.
        (1) A taxpayer shall be allowed a credit equal to .5% 
    of
the basis of qualified property placed in service during 
    the taxable year,
provided such property is placed in 
    service on or after
July 1, 1984.  There shall be allowed an 
    additional credit equal
to .5% of the basis of qualified 
    property placed in service during the
taxable year, 
    provided such property is placed in service on or
after 
    July 1, 1986, and the taxpayer's base employment
within 
    Illinois has increased by 1% or more over the preceding 
    year as
determined by the taxpayer's employment records 
    filed with the
Illinois Department of Employment Security.  
    Taxpayers who are new to
Illinois shall be deemed to have 
    met the 1% growth in base employment for
the first year in 
    which they file employment records with the Illinois

    Department of Employment Security.  The provisions added to 
    this Section by
Public Act 85-1200 (and restored by Public 
    Act 87-895) shall be
construed as declaratory of existing 
    law and not as a new enactment.  If,
in any year, the 
    increase in base employment within Illinois over the

    preceding year is less than 1%, the additional credit shall 
    be limited to that
percentage times a fraction, the 
    numerator of which is .5% and the denominator
of which is 
    1%, but shall not exceed .5%.  The investment credit shall 
    not be
allowed to the extent that it would reduce a 
    taxpayer's liability in any tax
year below zero, nor may 
    any credit for qualified property be allowed for any
year 
    other than the year in which the property was placed in 
    service in
Illinois. For tax years ending on or after 
    December 31, 1987, and on or
before December 31, 1988, the 
    credit shall be allowed for the tax year in
which the 
    property is placed in service, or, if the amount of the 
    credit
exceeds the tax liability for that year, whether it 
    exceeds the original
liability or the liability as later 
    amended, such excess may be carried
forward and applied to 
    the tax liability of the 5 taxable years following
the 
    excess credit years if the taxpayer (i) makes investments 
    which cause
the creation of a minimum of 2,000 full-time 
    equivalent jobs in Illinois,
(ii) is located in an 
    enterprise zone established pursuant to the Illinois

    Enterprise Zone Act and (iii) is certified by the 
    Department of Commerce
and Community Affairs (now 
    Department of Commerce and Economic Opportunity) as 
    complying with the requirements specified in
clause (i) and 
    (ii) by July 1, 1986.  The Department of Commerce and

    Community Affairs (now Department of Commerce and Economic 
    Opportunity) shall notify the Department of Revenue of all 
    such
certifications immediately. For tax years ending 
    after December 31, 1988,
the credit shall be allowed for 
    the tax year in which the property is
placed in service, 
    or, if the amount of the credit exceeds the tax
liability 
    for that year, whether it exceeds the original liability or 
    the
liability as later amended, such excess may be carried 
    forward and applied
to the tax liability of the 5 taxable 
    years following the excess credit
years. The credit shall 
    be applied to the earliest year for which there is
a 
    liability. If there is credit from more than one tax year 
    that is
available to offset a liability, earlier credit 
    shall be applied first.
        (2) The term "qualified property" means property 
    which:
            (A) is tangible, whether new or used, including 
        buildings and structural
components of buildings and 
        signs that are real property, but not including
land or 
        improvements to real property that are not a structural 
        component of a
building such as landscaping, sewer 
        lines, local access roads, fencing, parking
lots, and 
        other appurtenances;
            (B) is depreciable pursuant to Section 167 of the 
        Internal Revenue Code,
except that "3-year property" 
        as defined in Section 168(c)(2)(A) of that
Code is not 
        eligible for the credit provided by this subsection 
        (e);
            (C) is acquired by purchase as defined in Section 
        179(d) of
the Internal Revenue Code;
            (D) is used in Illinois by a taxpayer who is 
        primarily engaged in
manufacturing, or in mining coal 
        or fluorite, or in retailing, or was placed in  service 
        on or after July 1, 2006 in a River Edge Redevelopment 
        Zone established pursuant to the River Edge 
        Redevelopment Zone Act; and
            (E) has not previously been used in Illinois in 
        such a manner and by
such a person as would qualify for 
        the credit provided by this subsection
(e) or 
        subsection (f).
        (3) For purposes of this subsection (e), 
    "manufacturing" means
the material staging and production 
    of tangible personal property by
procedures commonly 
    regarded as manufacturing, processing, fabrication, or

    assembling which changes some existing material into new 
    shapes, new
qualities, or new combinations.  For purposes of 
    this subsection
(e) the term "mining" shall have the same 
    meaning as the term "mining" in
Section 613(c) of the 
    Internal Revenue Code.  For purposes of this subsection
(e), 
    the term "retailing" means the sale of tangible personal 
    property for use or consumption and not for resale, or

    services rendered in conjunction with the sale of tangible 
    personal property for use or consumption and not for 
    resale. For purposes of this subsection (e), "tangible 
    personal property" has the same meaning as when that term 
    is used in the Retailers' Occupation Tax Act, and, for 
    taxable years ending after December 31, 2008, does not 
    include the generation, transmission, or distribution of 
    electricity.
        (4) The basis of qualified property shall be the basis

    used to compute the depreciation deduction for federal 
    income tax purposes.
        (5) If the basis of the property for federal income tax 
    depreciation
purposes is increased after it has been placed 
    in service in Illinois by
the taxpayer, the amount of such 
    increase shall be deemed property placed
in service on the 
    date of such increase in basis.
        (6) The term "placed in service" shall have the same

    meaning as under Section 46 of the Internal Revenue Code.
        (7) If during any taxable year, any property ceases to

    be qualified property in the hands of the taxpayer within 
    48 months after
being placed in service, or the situs of 
    any qualified property is
moved outside Illinois within 48 
    months after being placed in service, the
Personal Property 
    Tax Replacement Income Tax for such taxable year shall be

    increased.  Such increase shall be determined by (i) 
    recomputing the
investment credit which would have been 
    allowed for the year in which
credit for such property was 
    originally allowed by eliminating such
property from such 
    computation and, (ii) subtracting such recomputed credit

    from the amount of credit previously allowed. For the 
    purposes of this
paragraph (7), a reduction of the basis of 
    qualified property resulting
from a redetermination of the 
    purchase price shall be deemed a disposition
of qualified 
    property to the extent of such reduction.
        (8) Unless the investment credit is extended by law, 
    the
basis of qualified property shall not include costs 
    incurred after
December 31, 2018, except for costs incurred 
    pursuant to a binding
contract entered into on or before 
    December 31, 2018.
        (9) Each taxable year ending before December 31, 2000, 
    a partnership may
elect to pass through to its
partners the 
    credits to which the partnership is entitled under this 
    subsection
(e) for the taxable year.  A partner may use the 
    credit allocated to him or her
under this paragraph only 
    against the tax imposed in subsections (c) and (d) of
this 
    Section.  If the partnership makes that election, those 
    credits shall be
allocated among the partners in the 
    partnership in accordance with the rules
set forth in 
    Section 704(b) of the Internal Revenue Code, and the rules

    promulgated under that Section, and the allocated amount of 
    the credits shall
be allowed to the partners for that 
    taxable year.  The partnership shall make
this election on 
    its Personal Property Tax Replacement Income Tax return for

    that taxable year. The election to pass through the credits 
    shall be
irrevocable.
        For taxable years ending on or after December 31, 2000, 
    a
partner that qualifies its
partnership for a subtraction 
    under subparagraph (I) of paragraph (2) of
subsection (d) 
    of Section 203 or a shareholder that qualifies a Subchapter 
    S
corporation for a subtraction under subparagraph (S) of 
    paragraph (2) of
subsection (b) of Section 203 shall be 
    allowed a credit under this subsection
(e) equal to its 
    share of the credit earned under this subsection (e) during

    the taxable year by the partnership or Subchapter S 
    corporation, 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.  This paragraph is exempt from the provisions 
    of Section 250.
    (f) Investment credit; Enterprise Zone; River Edge 
Redevelopment Zone.
        (1) A taxpayer shall be allowed a credit against the 
    tax imposed
by subsections (a) and (b) of this Section for 
    investment in qualified
property which is placed in service 
    in an Enterprise Zone created
pursuant to the Illinois 
    Enterprise Zone Act or, for property placed in  service on 
    or after July 1, 2006, a River Edge Redevelopment Zone 
    established pursuant to the River Edge Redevelopment Zone 
    Act.  For partners, shareholders
of Subchapter S 
    corporations, and owners of limited liability companies,

    if the liability company is treated as a partnership for 
    purposes of
federal and State income taxation, there shall 
    be allowed a credit under
this subsection (f) 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.  The credit 
    shall be .5% of the
basis for such property.  The credit 
    shall be available only in the taxable
year in which the 
    property is placed in service in the Enterprise Zone or 
    River Edge Redevelopment Zone and
shall not be allowed to 
    the extent that it would reduce a taxpayer's
liability for 
    the tax imposed by subsections (a) and (b) of this Section 
    to
below zero.  For tax years ending on or after December 
    31, 1985, the credit
shall be allowed for the tax year in 
    which the property is placed in
service, or, if the amount 
    of the credit exceeds the tax liability for that
year, 
    whether it exceeds the original liability or the liability 
    as later
amended, such excess may be carried forward and 
    applied to the tax
liability of the 5 taxable years 
    following the excess credit year.
The credit shall be 
    applied to the earliest year for which there is a

    liability.  If there is credit from more than one tax year 
    that is available
to offset a liability, the credit 
    accruing first in time shall be applied
first.
        (2) The term qualified property means property which:
            (A) is tangible, whether new or used, including 
        buildings and
structural components of buildings;
            (B) is depreciable pursuant to Section 167 of the 
        Internal Revenue
Code, except that "3-year property" 
        as defined in Section 168(c)(2)(A) of
that Code is not 
        eligible for the credit provided by this subsection 
        (f);
            (C) is acquired by purchase as defined in Section 
        179(d) of
the Internal Revenue Code;
            (D) is used in the Enterprise Zone or River Edge 
        Redevelopment Zone by the taxpayer; and
            (E) has not been previously used in Illinois in 
        such a manner and by
such a person as would qualify for 
        the credit provided by this subsection
(f) or 
        subsection (e).
        (3) The basis of qualified property shall be the basis 
    used to compute
the depreciation deduction for federal 
    income tax purposes.
        (4) If the basis of the property for federal income tax 
    depreciation
purposes is increased after it has been placed 
    in service in the Enterprise
Zone or River Edge 
    Redevelopment Zone by the taxpayer, the amount of such 
    increase shall be deemed property
placed in service on the 
    date of such increase in basis.
        (5) The term "placed in service" shall have the same 
    meaning as under
Section 46 of the Internal Revenue Code.
        (6) If during any taxable year, any property ceases to 
    be qualified
property in the hands of the taxpayer within 
    48 months after being placed
in service, or the situs of 
    any qualified property is moved outside the
Enterprise Zone 
    or River Edge Redevelopment Zone within 48 months after 
    being placed in service, the tax
imposed under subsections 
    (a) and (b) of this Section for such taxable year
shall be 
    increased.  Such increase shall be determined by (i) 
    recomputing
the investment credit which would have been 
    allowed for the year in which
credit for such property was 
    originally allowed by eliminating such
property from such 
    computation, and (ii) subtracting such recomputed credit

    from the amount of credit previously allowed.  For the 
    purposes of this
paragraph (6), a reduction of the basis of 
    qualified property resulting
from a redetermination of the 
    purchase price shall be deemed a disposition
of qualified 
    property to the extent of such reduction.
        (7) There shall be allowed an additional credit equal 
    to 0.5% of the basis of qualified property placed in 
    service during the taxable year in a River Edge 
    Redevelopment Zone, provided such property is placed in 
    service on or after July 1, 2006, and the taxpayer's base 
    employment within Illinois has increased by 1% or more over 
    the preceding year as determined by the taxpayer's 
    employment records filed with the Illinois Department of 
    Employment Security.  Taxpayers who are new to Illinois 
    shall be deemed to have met the 1% growth in base 
    employment for the first year in which they file employment 
    records with the Illinois Department of Employment 
    Security.  If, in any year, the increase in base employment 
    within Illinois over the preceding year is less than 1%, 
    the additional credit shall be limited to that percentage 
    times a fraction, the numerator of which is 0.5% and the 
    denominator of which is 1%, but shall not exceed 0.5%.

        (8) For taxable years beginning on or after January 1, 
    2021, there shall be allowed an Enterprise Zone 
    construction jobs credit against the taxes imposed under 
    subsections (a) and (b) of this Section as provided in 
    Section 13 of the Illinois Enterprise Zone Act. 
        The credit or credits may not reduce the taxpayer's 
    liability to less than zero. If the amount of the credit or 
    credits exceeds the taxpayer's liability, the excess may be 
    carried forward and applied against the taxpayer's 
    liability in succeeding calendar years in the same manner 
    provided under paragraph (4) of Section 211 of this Act. 
    The credit or credits shall be applied to the earliest year 
    for which there is a tax liability. If there are credits 
    from more than one taxable year that are available to 
    offset a liability, the earlier credit shall be applied 
    first. 
        For partners, shareholders of Subchapter S 
    corporations, and owners of limited liability companies, 
    if the liability company is treated as a partnership for 
    the purposes of federal and State income taxation, 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. 
        The total aggregate amount of credits awarded under the 
    Blue Collar Jobs Act (Article 20 of this amendatory Act of 
    the 101st General Assembly) shall not exceed $20,000,000 in 
    any State fiscal year 
        This paragraph (8) is exempt from the provisions of 
    Section 250. 
    (g) (Blank).
    (h) Investment credit; High Impact Business.
        (1) Subject to subsections (b) and (b-5) of Section
5.5 
    of the Illinois Enterprise Zone Act, a taxpayer shall be 
    allowed a credit
against the tax imposed by subsections (a) 
    and (b) of this Section for
investment in qualified

    property which is placed in service by a Department of 
    Commerce and Economic Opportunity

designated High Impact 
    Business.  The credit shall be .5% of the basis
for such 
    property.  The credit shall not be available (i) until the 
    minimum
investments in qualified property set forth in 
    subdivision (a)(3)(A) of
Section 5.5 of the Illinois

    Enterprise Zone Act have been satisfied
or (ii) until the 
    time authorized in subsection (b-5) of the Illinois

    Enterprise Zone Act for entities designated as High Impact 
    Businesses under
subdivisions (a)(3)(B), (a)(3)(C), and 
    (a)(3)(D) of Section 5.5 of the Illinois
Enterprise Zone 
    Act, and shall not be allowed to the extent that it would

    reduce a taxpayer's liability for the tax imposed by 
    subsections (a) and (b) of
this Section to below zero.  The 
    credit applicable to such investments shall be
taken in the 
    taxable year in which such investments have been completed.  
    The
credit for additional investments beyond the minimum 
    investment by a designated
high impact business authorized 
    under subdivision (a)(3)(A) of Section 5.5 of
the Illinois 
    Enterprise Zone Act shall be available only in the taxable 
    year in
which the property is placed in service and shall 
    not be allowed to the extent
that it would reduce a 
    taxpayer's liability for the tax imposed by subsections
(a) 
    and (b) of this Section to below zero.
For tax years ending 
    on or after December 31, 1987, the credit shall be
allowed 
    for the tax year in which the property is placed in 
    service, or, if
the amount of the credit exceeds the tax 
    liability for that year, whether
it exceeds the original 
    liability or the liability as later amended, such
excess 
    may be carried forward and applied to the tax liability of 
    the 5
taxable years following the excess credit year.  The 
    credit shall be
applied to the earliest year for which 
    there is a liability.  If there is
credit from more than one 
    tax year that is available to offset a liability,
the 
    credit accruing first in time shall be applied first.
        Changes made in this subdivision (h)(1) by Public Act 
    88-670
restore changes made by Public Act 85-1182 and 
    reflect existing law.
        (2) The term qualified property means property which:
            (A) is tangible, whether new or used, including 
        buildings and
structural components of buildings;
            (B) is depreciable pursuant to Section 167 of the 
        Internal Revenue
Code, except that "3-year property" 
        as defined in Section 168(c)(2)(A) of
that Code is not 
        eligible for the credit provided by this subsection 
        (h);
            (C) is acquired by purchase as defined in Section 
        179(d) of the
Internal Revenue Code; and
            (D) is not eligible for the Enterprise Zone 
        Investment Credit provided
by subsection (f) of this 
        Section.
        (3) The basis of qualified property shall be the basis 
    used to compute
the depreciation deduction for federal 
    income tax purposes.
        (4) If the basis of the property for federal income tax 
    depreciation
purposes is increased after it has been placed 
    in service in a federally
designated Foreign Trade Zone or 
    Sub-Zone located in Illinois by the taxpayer,
the amount of 
    such increase shall be deemed property placed in service on

    the date of such increase in basis.
        (5) The term "placed in service" shall have the same 
    meaning as under
Section 46 of the Internal Revenue Code.
        (6) If during any taxable year ending on or before 
    December 31, 1996,
any property ceases to be qualified

    property in the hands of the taxpayer within 48 months 
    after being placed
in service, or the situs of any 
    qualified property is moved outside
Illinois within 48 
    months after being placed in service, the tax imposed
under 
    subsections (a) and (b) of this Section for such taxable 
    year shall
be increased.  Such increase shall be determined 
    by (i) recomputing the
investment credit which would have 
    been allowed for the year in which
credit for such property 
    was originally allowed by eliminating such
property from 
    such computation, and (ii) subtracting such recomputed 
    credit
from the amount of credit previously allowed.  For 
    the purposes of this
paragraph (6), a reduction of the 
    basis of qualified property resulting
from a 
    redetermination of the purchase price shall be deemed a 
    disposition
of qualified property to the extent of such 
    reduction.
        (7) Beginning with tax years ending after December 31, 
    1996, if a
taxpayer qualifies for the credit under this 
    subsection (h) and thereby is
granted a tax abatement and 
    the taxpayer relocates its entire facility in
violation of 
    the explicit terms and length of the contract under Section

    18-183 of the Property Tax Code, the tax imposed under 
    subsections
(a) and (b) of this Section shall be increased 
    for the taxable year
in which the taxpayer relocated its 
    facility by an amount equal to the
amount of credit 
    received by the taxpayer under this subsection (h).
    (h-5) High Impact Business constructions jobs credit. For 
taxable years beginning on or after January 1, 2021, there 
shall also be allowed a High Impact Business construction jobs 
credit against the tax imposed under subsections (a) and (b) of 
this Section as provided in subsections (i)  and (j) of Section 
5.5 of the Illinois Enterprise Zone Act. 
    The credit or credits may not reduce the taxpayer's 
liability to less than zero. If the amount of the credit or 
credits exceeds the taxpayer's liability, the excess may be 
carried forward and applied against the taxpayer's liability in 
succeeding calendar years in the manner provided under 
paragraph (4) of Section 211 of this Act. The credit or credits 
shall be applied to the earliest year for which there is a tax 
liability. If there are credits from more than one taxable year 
that are available to offset a liability, the earlier credit 
shall be applied first. 
    For partners, shareholders of Subchapter S corporations, 
and owners of limited liability companies, if the liability 
company is treated as a partnership for the purposes of federal 
and State income taxation, 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. 
    The total aggregate amount of credits awarded under the 
Blue Collar Jobs Act (Article 20 of this amendatory Act of the 
101st General Assembly) shall not exceed $20,000,000 in any 
State fiscal year 
    This subsection (h-5) is exempt from the provisions of 
Section 250. 
    (i) Credit for Personal Property Tax Replacement Income 
Tax.
For tax years ending prior to December 31, 2003, a credit 
shall be allowed
against the tax imposed by
subsections (a) and 
(b) of this Section for the tax imposed by subsections (c)
and 
(d) of this Section.  This credit shall be computed by 
multiplying the tax
imposed by subsections (c) and (d) of this 
Section by a fraction, the numerator
of which is base income 
allocable to Illinois and the denominator of which is
Illinois 
base income, and further multiplying the product by the tax 
rate
imposed by subsections (a) and (b) of this Section.
    Any credit earned on or after December 31, 1986 under
this 
subsection which is unused in the year
the credit is computed 
because it exceeds the tax liability imposed by
subsections (a) 
and (b) for that year (whether it exceeds the original

liability or the liability as later amended) may be carried 
forward and
applied to the tax liability imposed by subsections 
(a) and (b) of the 5
taxable years following the excess credit 
year, provided that no credit may
be carried forward to any 
year ending on or
after December 31, 2003.  This credit shall be

applied first to the earliest year for which there is a 
liability.  If
there is a credit under this subsection from more 
than one tax year that is
available to offset a liability the 
earliest credit arising under this
subsection shall be applied 
first.
    If, during any taxable year ending on or after December 31, 
1986, the
tax imposed by subsections (c) and (d) of this 
Section for which a taxpayer
has claimed a credit under this 
subsection (i) is reduced, the amount of
credit for such tax 
shall also be reduced.  Such reduction shall be
determined by 
recomputing the credit to take into account the reduced tax

imposed by subsections (c) and (d).  If any portion of the

reduced amount of credit has been carried to a different 
taxable year, an
amended return shall be filed for such taxable 
year to reduce the amount of
credit claimed.
    (j) Training expense credit.  Beginning with tax years 
ending on or
after December 31, 1986 and prior to December 31, 
2003, a taxpayer shall be
allowed a credit against the
tax 
imposed by subsections (a) and (b) under this Section
for all 
amounts paid or accrued, on behalf of all persons
employed by 
the taxpayer in Illinois or Illinois residents employed
outside 
of Illinois by a taxpayer, for educational or vocational 
training in
semi-technical or technical fields or semi-skilled 
or skilled fields, which
were deducted from gross income in the 
computation of taxable income.  The
credit against the tax 
imposed by subsections (a) and (b) shall be 1.6% of
such 
training expenses.  For partners, shareholders of subchapter S

corporations, and owners of limited liability companies, if the 
liability
company is treated as a partnership for purposes of 
federal and State income
taxation, there shall be allowed a 
credit under this subsection (j) 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.
    Any credit allowed under this subsection which is unused in 
the year
the credit is earned may be carried forward to each of 
the 5 taxable
years following the year for which the credit is 
first computed until it is
used.  This credit shall be applied 
first to the earliest year for which
there is a liability.  If 
there is a credit under this subsection from more
than one tax 
year that is available to offset a liability the earliest

credit arising under this subsection shall be applied first.  No 
carryforward
credit may be claimed in any tax year ending on or 
after
December 31, 2003.
    (k) Research and development credit. For tax years ending 
after July 1, 1990 and prior to
December 31, 2003, and 
beginning again for tax years ending on or after December 31, 
2004, and ending prior to January 1, 2022, a taxpayer shall be

allowed a credit against the tax imposed by subsections (a) and 
(b) of this
Section for increasing research activities in this 
State.  The credit
allowed against the tax imposed by 
subsections (a) and (b) shall be equal
to 6 1/2% of the 
qualifying expenditures for increasing research activities
in 
this State.  For partners, shareholders of subchapter S 
corporations, and
owners of limited liability companies, if the 
liability company is treated as a
partnership for purposes of 
federal and State income taxation, there shall be
allowed a 
credit under this subsection 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.
    For purposes of this subsection, "qualifying expenditures" 
means the
qualifying expenditures as defined for the federal 
credit for increasing
research activities which would be 
allowable under Section 41 of the
Internal Revenue Code and 
which are conducted in this State, "qualifying
expenditures for 
increasing research activities in this State" means the
excess 
of qualifying expenditures for the taxable year in which 
incurred
over qualifying expenditures for the base period, 
"qualifying expenditures
for the base period" means the average 
of the qualifying expenditures for
each year in the base 
period, and "base period" means the 3 taxable years
immediately 
preceding the taxable year for which the determination is
being 
made.
    Any credit in excess of the tax liability for the taxable 
year
may be carried forward. A taxpayer may elect to have the

unused credit shown on its final completed return carried over 
as a credit
against the tax liability for the following 5 
taxable years or until it has
been fully used, whichever occurs 
first; provided that no credit earned in a tax year ending 
prior to December 31, 2003 may be carried forward to any year 
ending on or after December 31, 2003.
    If an unused credit is carried forward to a given year from 
2 or more
earlier years, that credit arising in the earliest 
year will be applied
first against the tax liability for the 
given year.  If a tax liability for
the given year still 
remains, the credit from the next earliest year will
then be 
applied, and so on, until all credits have been used or no tax

liability for the given year remains.  Any remaining unused 
credit or
credits then will be carried forward to the next 
following year in which a
tax liability is incurred, except 
that no credit can be carried forward to
a year which is more 
than 5 years after the year in which the expense for
which the 
credit is given was incurred.
    No inference shall be drawn from this amendatory Act of the 
91st General
Assembly in construing this Section for taxable 
years beginning before January
1, 1999.
    It is the intent of the General Assembly that the research 
and development credit under this subsection (k) shall apply 
continuously for all tax years ending on or after December 31, 
2004 and ending prior to January 1, 2022, including, but not 
limited to, the period beginning on January 1, 2016 and ending 
on the effective date of this amendatory Act of the 100th 
General Assembly. All actions taken in reliance on the 
continuation of the credit under this subsection (k) by any 
taxpayer are hereby validated. 
    (l) Environmental Remediation Tax Credit.
        (i) For tax  years ending after December 31, 1997 and on 
    or before
December 31, 2001, a taxpayer shall be allowed a 
    credit against the tax
imposed by subsections (a) and (b) 
    of this Section for certain amounts paid
for unreimbursed 
    eligible remediation costs, as specified in this 
    subsection.
For purposes of this Section, "unreimbursed 
    eligible remediation costs" means
costs approved by the 
    Illinois Environmental Protection Agency ("Agency") under

    Section 58.14 of the Environmental Protection Act that were 
    paid in performing
environmental remediation at a site for 
    which a No Further Remediation Letter
was issued by the 
    Agency and recorded under Section 58.10 of the 
    Environmental
Protection Act.  The credit must be claimed 
    for the taxable year in which
Agency approval of the 
    eligible remediation costs is granted.  The credit is
not 
    available to any taxpayer if the taxpayer or any related 
    party caused or
contributed to, in any material respect, a 
    release of regulated substances on,
in, or under the site 
    that was identified and addressed by the remedial
action 
    pursuant to the Site Remediation Program of the 
    Environmental Protection
Act.  After the Pollution Control 
    Board rules are adopted pursuant to the
Illinois 
    Administrative Procedure Act for the administration and 
    enforcement of
Section 58.9 of the Environmental 
    Protection Act, determinations as to credit
availability 
    for purposes of this Section shall be made consistent with 
    those
rules.  For purposes of this Section, "taxpayer" 
    includes a person whose tax
attributes the taxpayer has 
    succeeded to under Section 381 of the Internal
Revenue Code 
    and "related party" includes the persons disallowed a 
    deduction
for losses by paragraphs (b), (c), and (f)(1) of 
    Section 267 of the Internal
Revenue Code by virtue of being 
    a related taxpayer, as well as any of its
partners.  The 
    credit allowed against the tax imposed by subsections (a) 
    and
(b) shall be equal to 25% of the unreimbursed eligible 
    remediation costs in
excess of $100,000 per site, except 
    that the $100,000 threshold shall not apply
to any site 
    contained in an enterprise zone as determined by the 
    Department of
Commerce and Community Affairs (now 
    Department of Commerce and Economic Opportunity).  The 
    total credit allowed shall not exceed
$40,000 per year with 
    a maximum total of $150,000 per site.  For partners and

    shareholders of subchapter S corporations, there shall be 
    allowed a credit
under this subsection 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.
        (ii) A credit allowed under this subsection that is 
    unused in the year
the credit is earned may be carried 
    forward to each of the 5 taxable years
following the year 
    for which the credit is first earned until it is used.
The 
    term "unused credit" does not include any amounts of 
    unreimbursed eligible
remediation costs in excess of the 
    maximum credit per site authorized under
paragraph (i).  
    This credit shall be applied first to the earliest year
for 
    which there is a liability.  If there is a credit under this 
    subsection
from more than one tax year that is available to 
    offset a liability, the
earliest credit arising under this 
    subsection shall be applied first.  A
credit allowed under 
    this subsection may be sold to a buyer as part of a sale
of 
    all or part of the remediation site for which the credit 
    was granted.  The
purchaser of a remediation site and the 
    tax credit shall succeed to the unused
credit and remaining 
    carry-forward period of the seller.  To perfect the

    transfer, the assignor shall record the transfer in the 
    chain of title for the
site and provide written notice to 
    the Director of the Illinois Department of
Revenue of the 
    assignor's intent to sell the remediation site and the 
    amount of
the tax credit to be transferred as a portion of 
    the sale.  In no event may a
credit be transferred to any 
    taxpayer if the taxpayer or a related party would
not be 
    eligible under the provisions of subsection (i).
        (iii) For purposes of this Section, the term "site" 
    shall have the same
meaning as under Section 58.2 of the 
    Environmental Protection Act.
    (m) Education expense credit.  Beginning with tax years 
ending after
December 31, 1999, a taxpayer who
is the custodian 
of one or more qualifying pupils shall be allowed a credit

against the tax imposed by subsections (a) and (b) of this 
Section for
qualified education expenses incurred on behalf of 
the qualifying pupils.
The credit shall be equal to 25% of 
qualified education expenses, but in no
event may the total 
credit under this subsection claimed by a
family that is the

custodian of qualifying pupils exceed (i) $500 for tax years 
ending prior to December 31, 2017, and (ii) $750 for tax years 
ending on or after December 31, 2017.  In no event shall a 
credit under
this subsection reduce the taxpayer's liability 
under this Act to less than
zero.  Notwithstanding any other 
provision of law, for taxable years beginning on or after 
January 1, 2017, no taxpayer may claim a credit under this 
subsection (m) if the taxpayer's adjusted gross income for the 
taxable year exceeds (i) $500,000, in the case of spouses 
filing a joint federal tax return or (ii) $250,000, in the case 
of all other taxpayers. This subsection is exempt from the 
provisions of Section 250 of this
Act.
    For purposes of this subsection:
    "Qualifying pupils" means individuals who (i) are 
residents of the State of
Illinois, (ii) are under the age of 
21 at the close of the school year for
which a credit is 
sought, and (iii) during the school year for which a credit
is 
sought were full-time pupils enrolled in a kindergarten through 
twelfth
grade education program at any school, as defined in 
this subsection.
    "Qualified education expense" means the amount incurred
on 
behalf of a qualifying pupil in excess of $250 for tuition, 
book fees, and
lab fees at the school in which the pupil is 
enrolled during the regular school
year.
    "School" means any public or nonpublic elementary or 
secondary school in
Illinois that is in compliance with Title 
VI of the Civil Rights Act of 1964
and attendance at which 
satisfies the requirements of Section 26-1 of the
School Code, 
except that nothing shall be construed to require a child to

attend any particular public or nonpublic school to qualify for 
the credit
under this Section.
    "Custodian" means, with respect to qualifying pupils, an 
Illinois resident
who is a parent, the parents, a legal 
guardian, or the legal guardians of the
qualifying pupils.
    (n) River Edge Redevelopment Zone site remediation tax 
credit.

        (i) For tax years ending on or after December 31, 2006, 
    a taxpayer shall be allowed a credit against the tax 
    imposed by subsections (a) and (b) of this Section for 
    certain amounts paid for unreimbursed eligible remediation 
    costs, as specified in this subsection. For purposes of 
    this Section, "unreimbursed eligible remediation costs" 
    means costs approved by the Illinois Environmental 
    Protection Agency ("Agency") under Section 58.14a of the 
    Environmental Protection Act that were paid in performing 
    environmental remediation at a site within a River Edge 
    Redevelopment Zone for which a No Further Remediation 
    Letter was issued by the Agency and recorded under Section 
    58.10 of the Environmental Protection Act. The credit must 
    be claimed for the taxable year in which Agency approval of 
    the eligible remediation costs is granted. The credit is 
    not available to any taxpayer if the taxpayer or any 
    related party caused or contributed to, in any material 
    respect, a release of regulated substances on, in, or under 
    the site that was identified and addressed by the remedial 
    action pursuant to the Site Remediation Program of the 
    Environmental Protection Act.  Determinations as to credit 
    availability for purposes of this Section shall be made 
    consistent with rules adopted by the Pollution Control 
    Board pursuant to the Illinois Administrative Procedure 
    Act for the administration and enforcement of Section 58.9 
    of the Environmental Protection Act. For purposes of this 
    Section, "taxpayer" includes a person whose tax attributes 
    the taxpayer has succeeded to under Section 381 of the 
    Internal Revenue Code and "related party" includes the 
    persons disallowed a deduction for losses by paragraphs 
    (b), (c), and (f)(1) of Section 267 of the Internal Revenue 
    Code by virtue of being a related taxpayer, as well as any 
    of its partners. The credit allowed against the tax imposed 
    by subsections (a) and (b) shall be equal to 25% of the 
    unreimbursed eligible remediation costs in excess of 
    $100,000 per site.
        (ii) A credit allowed under this subsection that is 
    unused in the year the credit is earned may be carried 
    forward to each of the 5 taxable years following the year 
    for which the credit is first earned until it is used. This 
    credit shall be applied first to the earliest year for 
    which there is a liability. If there is a credit under this 
    subsection from more than one tax year that is available to 
    offset a liability, the earliest credit arising under this 
    subsection shall be applied first. A credit allowed under 
    this subsection may be sold to a buyer as part of a sale of 
    all or part of the remediation site for which the credit 
    was granted. The purchaser of a remediation site and the 
    tax credit shall succeed to the unused credit and remaining 
    carry-forward period of the seller. To perfect the 
    transfer, the assignor shall record the transfer in the 
    chain of title for the site and provide written notice to 
    the Director of the Illinois Department of Revenue of the 
    assignor's intent to sell the remediation site and the 
    amount of the tax credit to be transferred as a portion of 
    the sale. In no event may a credit be transferred to any 
    taxpayer if the taxpayer or a related party would not be 
    eligible under the provisions of subsection (i).
        (iii) For purposes of this Section, the term "site" 
    shall have the same meaning as under Section 58.2 of the 
    Environmental Protection Act.
    (o)  For each of taxable years during the Compassionate Use 
of Medical Cannabis Pilot Program, a surcharge is imposed on 
all taxpayers on income arising from the sale or exchange of 
capital assets, depreciable business property, real property 
used in the trade or business, and Section 197 intangibles of 
an organization registrant under the Compassionate Use of 
Medical Cannabis Pilot Program Act. The amount of the surcharge 
is equal to the amount of federal income tax liability for the 
taxable year attributable to those sales and exchanges. The 
surcharge imposed does not apply if:
        (1) the medical cannabis cultivation center 
    registration, medical cannabis dispensary registration, or 
    the property of a registration is transferred as a result 
    of any of the following:
            (A) bankruptcy, a receivership, or a debt 
        adjustment initiated by or against the initial 
        registration or the  substantial owners of the initial 
        registration;
            (B) cancellation, revocation, or termination of 
        any registration by the Illinois Department of Public 
        Health;
            (C) a determination by the Illinois Department of 
        Public Health that transfer of the registration is in 
        the best interests of Illinois qualifying patients as 
        defined by the Compassionate Use of Medical Cannabis 
        Pilot Program Act;
            (D) the death of an owner of the equity interest in 
        a registrant;
            (E) the acquisition of a controlling interest in 
        the stock or substantially all of the assets of a 
        publicly traded company;
            (F) a transfer by a parent company to a wholly 
        owned subsidiary; or
            (G) the transfer or sale to or by one person to 
        another person where both persons were initial owners 
        of the registration when the registration was issued; 
        or
        (2) the cannabis cultivation center registration, 
    medical cannabis dispensary registration, or the 
    controlling interest in a registrant's property is 
    transferred in a transaction to lineal descendants in which 
    no gain or loss is recognized or as a result of a 
    transaction in accordance with Section 351 of the Internal 
    Revenue Code in which no gain or loss is recognized.
(Source: P.A. 100-22, eff. 7-6-17.)
 



    (35 ILCS 5/211)



    Sec. 211. Economic Development for a Growing Economy Tax 
Credit. For tax years beginning on or after January 1, 1999, a 
Taxpayer
who has entered into an Agreement (including a New 
Construction EDGE Agreement) under the Economic Development 
for a Growing
Economy Tax Credit Act is entitled to a credit 
against the taxes imposed
under subsections (a) and (b) of 
Section 201 of this Act in an amount to be
determined in the 
Agreement.  If the Taxpayer is a partnership or Subchapter
S 
corporation, the credit shall be allowed to the partners or 
shareholders 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.
The Department, in 
cooperation with the Department
of Commerce and Economic 
Opportunity, shall prescribe rules to enforce and
administer 
the provisions of this Section.  This Section is
exempt from the 
provisions of Section 250 of this Act.

    The credit shall be  subject to the conditions set forth in

the Agreement and the following limitations:


        (1) The tax credit shall not exceed the Incremental 
    Income Tax
(as defined in Section 5-5 of the Economic 
    Development for a Growing Economy
Tax Credit Act) with 
    respect to the project; additionally, the New Construction 
    EDGE Credit shall not exceed the New Construction EDGE 
    Incremental Income Tax (as defined in Section 5-5 of the 
    Economic Development for a Growing Economy Tax Credit Act).


        (2) The amount of the credit allowed during the tax 
    year plus the sum of
all amounts allowed in prior years 
    shall not exceed 100% of the aggregate
amount expended by 
    the Taxpayer during all prior tax years on approved costs

    defined by Agreement.


        (3) The amount of the credit shall be determined on an 
    annual
basis.  Except as applied in a carryover year 
    pursuant to Section 211(4) of
this Act, the credit may not 
    be applied against any State
income tax liability in more 
    than 10 taxable
years; provided, however, that (i) an 
    eligible business certified by the
Department of Commerce 
    and Economic Opportunity under the Corporate Headquarters

    Relocation Act may not
apply the credit against any of its 
    State income tax liability in more than 15
taxable years

    and (ii) credits allowed to that eligible business are 
    subject to the
conditions
and requirements set forth in 
    Sections 5-35 and 5-45 of the Economic
Development for a 
    Growing Economy Tax Credit Act and Section 5-51 as 
    applicable to New Construction EDGE Credits.


        (4) The credit may not exceed the amount of taxes 
    imposed pursuant to
subsections (a) and (b) of Section 201 
    of this Act.  Any credit
that is unused in the year the 
    credit is computed may be carried forward and
applied to 
    the tax liability of the 5 taxable years following the 
    excess credit
year.  The credit shall be applied to the 
    earliest year for which there is a
tax liability.  If there 
    are credits from more than one tax year that are
available 
    to offset a liability, the earlier credit shall be applied 
    first.


        (5) No credit shall be allowed with respect to any 
    Agreement for any
taxable year ending after the 
    Noncompliance Date.  Upon receiving notification
by the 
    Department of Commerce and Economic Opportunity of the 
    noncompliance of a
Taxpayer with an Agreement, the 
    Department shall notify the Taxpayer that no
credit is 
    allowed with respect to that Agreement for any taxable year 
    ending
after the Noncompliance Date, as stated in such 
    notification.  If any credit
has been allowed with respect 
    to an Agreement for a taxable year ending after
the 
    Noncompliance Date for that Agreement, any refund paid to 
    the
Taxpayer for that taxable year shall, to the extent of 
    that credit allowed, be
an erroneous refund within the 
    meaning of Section 912 of this Act.


        (6) For purposes of this Section, the terms 
    "Agreement",  "Incremental
Income Tax", "New Construction 
    EDGE Agreement", "New Construction EDGE Credit", "New 
    Construction EDGE Incremental Income Tax", and 
    "Noncompliance Date" have the same meaning as when used
in 
    the Economic Development for a Growing Economy Tax Credit 
    Act.

(Source: P.A. 94-793, eff. 5-19-06.)

 
    (35 ILCS 5/221)
    Sec. 221. Rehabilitation costs; qualified historic 
properties; River Edge Redevelopment Zone.
    (a)  For taxable years that begin on or after January 1, 
2012 and begin prior to January 1, 2018, there shall be allowed 
a tax credit against the tax imposed by subsections (a) and (b) 
of Section 201 of this Act in an amount equal to 25% of 
qualified expenditures incurred by a qualified taxpayer during 
the taxable year in the restoration and preservation of a 
qualified historic structure located in a River Edge 
Redevelopment Zone pursuant to a qualified rehabilitation 
plan, provided that the total amount of such expenditures (i) 
must equal $5,000 or more and (ii) must exceed 50% of the 
purchase price of the property.
    (a-1) For taxable years that begin on or after January 1, 
2018 and end prior to January 1, 2022, there shall be allowed a 
tax credit against the tax imposed by subsections (a) and (b) 
of Section 201 of this Act in an aggregate amount equal to 25% 
of qualified expenditures incurred by a qualified taxpayer in 
the restoration and preservation of a qualified historic 
structure located in a River Edge Redevelopment Zone pursuant 
to a qualified rehabilitation plan, provided that the total 
amount of such expenditures must (i) equal $5,000 or more and 
(ii) exceed the adjusted basis of the qualified historic 
structure on the first day the qualified rehabilitation plan 
begins. For any rehabilitation project, regardless of duration 
or number of phases, the project's compliance with the 
foregoing provisions (i) and (ii) shall be determined based on 
the aggregate amount of qualified expenditures for the entire 
project and may include expenditures incurred under subsection 
(a), this subsection, or both subsection (a) and this 
subsection. If the qualified rehabilitation plan spans 
multiple years, the aggregate credit for the entire project 
shall be allowed in the last taxable year, except for phased 
rehabilitation projects, which may receive credits upon 
completion of each phase. Before obtaining the first phased 
credit: (A) the total amount of such expenditures must meet the 
requirements of provisions (i) and (ii) of this subsection; (B) 
the rehabilitated portion of the qualified historic structure 
must be placed in service; and (C) the requirements of 
subsection (b) must be met.
    (a-2) For taxable years beginning on or after January 1, 
2021 and ending prior to January 1, 2022, there shall be 
allowed a tax credit against  the tax imposed by subsections (a) 
and (b) of Section 201 as provided in Section 10-10.3 of the 
River Edge Redevelopment Zone Act. The credit allowed under 
this subsection (a-2) shall apply only to taxpayers that make a 
capital investment of at least $1,000,000 in a qualified 
rehabilitation plan. 
    The credit or credits may not reduce the taxpayer's 
liability to less than zero. If the amount of the credit or 
credits exceeds the taxpayer's liability, the excess may be 
carried forward and applied against the taxpayer's liability in 
succeeding calendar years in the manner provided under 
paragraph (4) of Section 211 of this Act. The credit or credits 
shall be applied to the earliest year for which there is a tax 
liability. If there are credits from more than one taxable year 
that are available to offset a liability, the earlier credit 
shall be applied first. 
    For partners, shareholders of Subchapter S corporations, 
and owners of limited liability companies, if the liability 
company is treated as a partnership for the purposes of federal 
and State income taxation, 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. 
    The total aggregate amount of credits awarded under the 
Blue Collar Jobs Act (Article 20 of this amendatory Act of the 
101st General Assembly) shall not exceed $20,000,000 in any 
State fiscal year. 
    (b)  To obtain a tax credit pursuant to this Section, the 
taxpayer must apply with the Department of Natural Resources. 
The Department of Natural Resources shall determine the amount 
of eligible rehabilitation costs and expenses in addition to 
the amount of the River Edge construction jobs credit within 45 
days of receipt of a complete application. The taxpayer must 
submit a certification of costs prepared by an independent 
certified public accountant that certifies (i) the project 
expenses, (ii) whether those expenses are qualified 
expenditures, and (iii) that the qualified expenditures exceed 
the adjusted basis of the qualified historic structure on the 
first day the qualified rehabilitation plan commenced. The 
Department of Natural Resources is authorized, but not 
required, to accept this certification of costs to determine 
the amount of qualified expenditures and the amount of the 
credit. The Department of Natural Resources shall provide 
guidance as to the minimum standards to be followed in the 
preparation of such certification. The Department of Natural 
Resources and the National Park Service shall determine whether 
the rehabilitation is consistent with the United States 
Secretary of the Interior's Standards for Rehabilitation. 
    (b-1) Upon completion of the project and approval of the 
complete application, the Department of Natural Resources 
shall issue a single certificate in the amount of the eligible 
credits equal to 25% of qualified expenditures incurred during 
the eligible taxable years, as defined in subsections (a) and 
(a-1), excepting any credits awarded under subsection (a) prior 
to January 1, 2019 (the effective date of Public Act 100-629) 
this amendatory Act of the 100th General Assembly and any 
phased credits issued prior to the eligible taxable year under 
subsection (a-1). At the time the certificate is issued, an 
issuance fee up to the maximum amount of 2% of the amount of 
the credits issued by the certificate may be collected from the 
applicant to administer the provisions of this Section. If 
collected, this issuance fee shall be deposited into the 
Historic Property Administrative Fund, a special fund created 
in the State treasury.  Subject to appropriation, moneys in the 
Historic Property Administrative Fund shall be provided to the 
Department of Natural Resources as reimbursement Department of 
Natural Resources for the costs associated with administering 
this Section. 
    (c)  The taxpayer must attach the certificate to the tax 
return on which the credits are to be claimed. The tax credit 
under this Section may not reduce the taxpayer's liability to 
less than
zero. If the amount of the credit exceeds the tax 
liability for the year, the excess credit may be carried 
forward and applied to the tax liability of the 5 taxable years 
following the excess credit year. 
    (c-1) Subject to appropriation, moneys in the Historic 
Property Administrative Fund shall be used, on a biennial basis 
beginning at the end of the second fiscal year after January 1, 
2019 (the effective date of Public Act 100-629) this amendatory 
Act of the 100th General Assembly, to hire a qualified third 
party to prepare a biennial report to assess the overall 
economic impact to the State from the qualified rehabilitation 
projects under this Section completed in that year and in 
previous years. The overall economic impact shall include at 
least: (1) the direct and indirect or induced economic impacts 
of completed projects; (2) temporary, permanent, and 
construction jobs created; (3) sales, income, and property tax 
generation before, during construction, and after completion; 
and (4) indirect neighborhood impact after completion. The 
report shall be submitted to the Governor and the General 
Assembly. The report to the General Assembly shall be filed 
with the Clerk of the House of Representatives and the 
Secretary of the Senate in electronic form only, in the manner 
that the Clerk and the Secretary shall direct. 
    (c-2) The Department of Natural Resources may adopt rules 
to implement this Section in addition to the rules expressly 
authorized in this Section. 
    (d)  As used in this Section, the following terms have the 
following meanings.
    "Phased rehabilitation" means a project that is completed 
in phases, as defined under Section 47 of the federal Internal 
Revenue Code and pursuant to National Park Service regulations 
at 36 C.F.R. 67. 
    "Placed in service" means the date when the property is 
placed in a condition or state of readiness and availability 
for a specifically assigned function as defined under Section 
47 of the federal Internal Revenue Code and federal Treasury 
Regulation Sections 1.46 and 1.48. 
    "Qualified expenditure" means all the costs and expenses 
defined as qualified rehabilitation expenditures under Section 
47 of the federal Internal Revenue Code that were incurred in 
connection with a qualified historic structure. 
    "Qualified historic structure" means a certified historic 
structure as defined under Section 47(c)(3) of the federal 
Internal Revenue Code. 
    "Qualified rehabilitation plan" means a project that is 
approved by the Department of Natural Resources and the 
National Park Service as being consistent with the United 
States Secretary of the Interior's Standards for 
Rehabilitation. 
    "Qualified taxpayer" means the owner of the qualified 
historic structure or any other person who qualifies for the 
federal rehabilitation credit allowed by Section 47 of the 
federal Internal Revenue Code with respect to that qualified 
historic structure.  Partners, shareholders of subchapter S 
corporations, and owners of limited liability companies (if the 
limited liability company is treated as  a partnership for 
purposes of federal and State income taxation) are entitled to 
a credit under this Section to be determined in accordance with 
the determination of income and distributive share of income 
under Sections 702 and 703 and subchapter S of the Internal 
Revenue Code, provided that credits granted to  a partnership, a 
limited liability company taxed as a partnership, or other 
multiple owners of property shall be passed through to the 
partners, members, or owners respectively on a pro rata basis 
or pursuant to an executed agreement among the partners, 
members, or owners documenting any alternate distribution 
method. 

(Source: P.A. 99-914, eff. 12-20-16; 100-236, eff. 8-18-17; 
100-629, eff. 1-1-19; 100-695, eff. 8-3-18; revised 10-18-18.)
 
    Section 20-15. The Economic Development for a Growing 
Economy Tax Credit Act is amended  by changing Section 5-5 and  
by adding Sections 5-51 and 5-56 as follows:
 



    (35 ILCS 10/5-5)



    Sec. 5-5. Definitions. As used in this Act:

    "Agreement" means the Agreement between a Taxpayer and the 
Department under
the provisions of Section 5-50 of this Act.

    "Applicant" means a Taxpayer that is operating a business 
located or that
the Taxpayer plans to locate within the State 
of Illinois and that is engaged
in interstate or intrastate 
commerce for the purpose of manufacturing,
processing, 
assembling, warehousing, or distributing products, conducting

research and development, providing tourism services, or 
providing services
in interstate commerce, office industries, 
or agricultural processing, but
excluding retail, retail food, 
health, or professional services.
"Applicant" does not include 
a Taxpayer who closes or
substantially reduces an operation at 
one location in the State and relocates
substantially the same 
operation to another location in the State.  This does
not 
prohibit a Taxpayer from expanding its operations at another 
location in
the State, provided that existing operations of a 
similar nature located within
the State are not closed or 
substantially reduced.  This also does not prohibit
a Taxpayer 
from moving its operations from one location in the State to 
another
location in the State for the purpose of expanding the 
operation provided that
the Department determines that 
expansion cannot reasonably be accommodated
within the 
municipality in which the business is located, or in the case 
of a
business located in an incorporated area of the county, 
within the county in
which the business is located, after 
conferring with the chief elected
official of the municipality 
or county and taking into consideration any
evidence offered by 
the municipality or county regarding the ability to
accommodate 
expansion within the municipality or county.

    "Committee" means the Illinois Business Investment 
Committee created under
Section 5-25 of this Act within the 
Illinois Economic Development Board.

    "Credit" means the amount agreed to between the Department 
and Applicant
under this Act, but not to exceed the lesser of: 
(1) the sum of (i) 50% of the Incremental Income Tax 
attributable to
New Employees at the Applicant's project and 
(ii) 10% of the training costs of New Employees; or (2) 100% of 
the Incremental Income Tax attributable to
New Employees at the 
Applicant's project.  However, if the project is located in an 
underserved area, then the amount of the Credit may not exceed 
the lesser of: (1) the sum of (i) 75% of the Incremental Income 
Tax attributable to
New Employees at the Applicant's project 
and (ii) 10% of the training costs of New Employees; or (2) 
100% of the Incremental Income Tax attributable to
New 
Employees at the Applicant's project.  If an Applicant agrees to 
hire the required number of New Employees, then the maximum 
amount of the Credit for that Applicant may be increased by an 
amount not to exceed 25% of the Incremental Income Tax 
attributable to retained employees at the Applicant's project; 
provided that, in order to receive the increase for retained 
employees, the Applicant must provide the additional evidence 
required under paragraph (3) of subsection (b) of Section 5-25.

    "Department" means the Department of Commerce and Economic 
Opportunity.

    "Director" means the Director of Commerce and Economic 
Opportunity.

    "Full-time Employee" means an individual who is employed 
for consideration
for at least 35 hours each week or who 
renders any other standard of service
generally accepted by 
industry custom or practice as full-time employment. An 
individual for whom a W-2 is issued by a Professional Employer 
Organization (PEO) is a full-time employee if employed in the 
service of the Applicant for consideration for at least 35 
hours each week or who renders any other standard of service 
generally accepted by industry custom or practice as full-time 
employment to Applicant.


    "Incremental Income Tax" means the total amount withheld 
during the taxable
year from the compensation of New Employees 
and, if applicable, retained employees under Article 7 of the 
Illinois
Income Tax Act arising from employment at a project 
that is the subject of an
Agreement.

    "New Construction EDGE Agreement" means the Agreement 
between a Taxpayer and the Department under the provisions of 
Section 5-51 of this Act. 
    "New Construction EDGE Credit" means an amount agreed to 
between the Department and the Applicant under this Act as part 
of a New Construction EDGE Agreement that does not exceed 50% 
of the Incremental Income Tax attributable to New Construction 
EDGE Employees at the Applicant's project; however, if the New 
Construction EDGE Project is located in an underserved area, 
then the amount of the New Construction EDGE Credit may not 
exceed 75% of the Incremental Income Tax attributable to New 
Construction EDGE Employees at the Applicant's New 
Construction EDGE Project. 
    "New Construction EDGE Employee" means a laborer or worker 
who is employed by an Illinois contractor or subcontractor in 
the actual construction work on the site of a New Construction 
EDGE Project, pursuant to a New Construction EDGE Agreement. 
    "New Construction EDGE Incremental Income Tax" means the 
total amount withheld during the taxable year from the 
compensation of New Construction EDGE Employees. 
    "New Construction EDGE Project" means the building of a 
Taxpayer's structure or building, or making improvements of any 
kind to real property. "New Construction EDGE Project" does not 
include the routine operation, routine repair, or routine 
maintenance of existing structures, buildings, or real 
property. 
    "New Employee" means:

        (a) A Full-time Employee first employed by a Taxpayer 
    in the project
that is the subject of an Agreement and who 
    is hired after the Taxpayer
enters into the tax credit 
    Agreement.

        (b) The term "New Employee" does not include:

            (1) an employee of the Taxpayer who performs a job 
        that was previously
performed by another employee, if 
        that job existed for at least 6
months before hiring 
        the employee;

            (2) an employee of the Taxpayer who was previously 
        employed in
Illinois by a Related Member of the 
        Taxpayer and whose employment was
shifted to the 
        Taxpayer after the Taxpayer entered into the tax credit

        Agreement; or

            (3) a child, grandchild, parent, or spouse, other 
        than a spouse who
is legally separated from the 
        individual, of any individual who has a direct
or an 
        indirect ownership interest of at least 5% in the 
        profits, capital, or
value of the Taxpayer.

        (c) Notwithstanding paragraph (1) of subsection (b), 
    an employee may be
considered a New Employee under the 
    Agreement if the employee performs a job
that was 
    previously performed by an employee who was:

            (1) treated under the Agreement as a New Employee; 
        and

            (2) promoted by the Taxpayer to another job.

        (d) Notwithstanding subsection (a), the Department may 
    award Credit to an
Applicant with respect to an employee 
    hired prior to the date of the Agreement
if:

            (1) the Applicant is in receipt of a letter from 
        the Department stating
an
intent to enter into a credit 
        Agreement;

            (2) the letter described in paragraph (1) is issued 
        by the
Department not later than 15 days after the 
        effective date of this Act; and

            (3) the employee was hired after the date the 
        letter described in
paragraph (1) was issued.

    "Noncompliance Date" means, in the case of a Taxpayer that 
is not complying
with the requirements of the Agreement or the 
provisions of this Act, the day
following the last date upon 
which the Taxpayer was in compliance with the
requirements of 
the Agreement and the provisions of this Act, as determined
by 
the Director, pursuant to Section 5-65.

    "Pass Through Entity" means an entity that is exempt from 
the tax under
subsection (b) or (c) of Section 205 of the 
Illinois Income Tax Act.

    "Professional Employer Organization" (PEO) means an 
employee leasing company, as defined in Section 206.1(A)(2) of 
the Illinois Unemployment Insurance Act.

    "Related Member" means a person that, with respect to the 
Taxpayer during
any portion of the taxable year, is any one  of 
the following:

        (1) An individual stockholder, if the stockholder and 
    the members of the
stockholder's family (as defined in 
    Section 318 of the Internal Revenue Code)
own directly, 
    indirectly, beneficially, or constructively, in the 
    aggregate,
at least 50% of the value of the Taxpayer's 
    outstanding stock.

        (2) A partnership, estate, or trust and any partner or 
    beneficiary,
if the partnership, estate, or trust, and its 
    partners or beneficiaries own
directly, indirectly, 
    beneficially, or constructively, in the aggregate, at

    least 50% of the profits, capital, stock, or value of the

    Taxpayer.

        (3) A corporation, and any party related to the 
    corporation in a manner
that would require an attribution 
    of stock from the corporation to the
party or from the 
    party to the corporation under the attribution rules
of 
    Section 318 of the Internal Revenue Code, if the Taxpayer 
    owns
directly, indirectly, beneficially, or constructively 
    at least
50% of the value of the corporation's outstanding 
    stock.

        (4) A corporation and any party related to that 
    corporation in a manner
that would require an attribution 
    of stock from the corporation to the party or
from the 
    party to the corporation under the attribution rules of 
    Section 318 of
the Internal Revenue Code, if the 
    corporation and all such related parties own
in the 
    aggregate at least 50% of the profits, capital, stock, or 
    value of the
Taxpayer.

        (5) A person to or from whom there is attribution of 
    stock ownership
in accordance with Section 1563(e) of the 
    Internal Revenue Code, except,
for purposes of determining 
    whether a person is a Related Member under
this paragraph, 
    20% shall be substituted for 5% wherever  5% appears in

    Section 1563(e) of the Internal Revenue Code.

    "Taxpayer" means an individual, corporation, partnership, 
or other entity
that has any Illinois Income Tax liability.

    "Underserved area" means a geographic area that meets one 
or more of the following conditions: 
        (1) the area has a poverty rate of at least 20% 
    according to the latest federal decennial census;
        (2) 75% or more of the children in the area participate 
    in the federal free lunch program according to reported 
    statistics from the State Board of Education; 
        (3) at least 20% of the households in the area receive 
    assistance under the Supplemental Nutrition Assistance 
    Program (SNAP); or 
        (4) the area has
an average unemployment rate, as 
    determined by the Illinois Department of
Employment 
    Security, that is more than 120% of the national 
    unemployment average, as
determined by the U.S. Department 
    of Labor, for  a period of at least 2 consecutive calendar 
    years preceding the date of the application. 
(Source: P.A. 100-511, eff. 9-18-17.)

 
    (35 ILCS 10/5-51 new)
    Sec. 5-51. New Construction EDGE Agreement.
    (a) Notwithstanding any other provisions of this Act, and 
in addition to any Credit otherwise allowed under this Act, 
beginning on January 1, 2021, there is allowed a New 
Construction EDGE Credit for eligible Applicants that meet the 
following criteria: 
        (1) the Department has certified that the Applicant 
    meets all requirements of Sections 5-15, 5-20, and 5-25; 
    and 
        (2) the Department has certified that, pursuant to 
    Section 5-20, the Applicant's Agreement includes a capital 
    investment of at least $10,000,000 in a New Construction 
    EDGE Project to be placed in service within the State as a 
    direct result of an Agreement entered into pursuant to this 
    Section. 
    (b) The Department shall notify each Applicant during the 
application process that their project is eligible for a New 
Construction EDGE Credit. The Department shall create a 
separate application to be filled out by the Applicant 
regarding the New Construction EDGE credit. The Application 
shall include the following: 
        (1) a detailed description of the New Construction EDGE 
    Project that is subject to the New Construction EDGE 
    Agreement, including the location and amount of the 
    investment and jobs created or retained; 
        (2) the duration of the New Construction EDGE Credit 
    and the first taxable year for which the Credit may be 
    claimed; 
        (3) the New Construction EDGE Credit amount that will 
    be allowed for each taxable year; 
        (4) a requirement that the Director is authorized to 
    verify with the appropriate State agencies the amount of 
    the incremental income tax withheld by a Taxpayer, and 
    after doing so, shall issue a certificate to the Taxpayer 
    stating that the amounts have been verified; 
        (5) the amount of the capital investment, which may at 
    no point be less than $10,000,000, the time period of 
    placing the New Construction EDGE Project in service, and 
    the designated location in Illinois for the investment; 
        (6) a requirement that the Taxpayer shall provide 
    written notification to the Director not more than 30 days 
    after the Taxpayer determines that the capital investment 
    of at least $10,000,000 is not or will not be achieved or 
    maintained as set forth in the terms and conditions of the 
    Agreement; 
        (7) a detailed provision that the Taxpayer shall be 
    awarded a New Construction EDGE Credit upon the verified 
    completion and occupancy of a New Construction EDGE 
    Project; and 
        (8) any other performance conditions, including the 
    ability to verify that a New Construction EDGE Project is 
    built and completed, or that contract provisions as the 
    Department determines are appropriate. 
    (c) The Department shall post on its website the terms of 
each New Construction EDGE Agreement entered into under this 
Act on or after the effective date of this amendatory Act of 
the 101st General Assembly. Such information shall be posted 
within 10 days after entering into the Agreement and must 
include the following: 
        (1) the name of the recipient business; 
        (2) the location of the project; 
        (3) the estimated value of the credit; and 
        (4) whether or not the project is located in an 
    underserved area. 
    (d) The Department, in collaboration with the Department of 
Labor, shall require that certified payroll reporting, 
pursuant to Section 5-56 of this Act, be completed in order to 
verify the wages and any other necessary information which the 
Department may deem necessary to ascertain and certify the 
total number of New Construction EDGE Employees subject to a 
New Construction EDGE Agreement and amount of a New 
Construction EDGE Credit. 
    (e) The total aggregate amount of credits awarded under the 
Blue Collar Jobs Act (Article 20 of this amendatory Act of the 
101st General Assembly) shall not exceed $20,000,000 in any 
State fiscal year. 
 
    (35 ILCS 10/5-56 new)
    Sec. 5-56. Certified payroll.
    (a) Each contractor and subcontractor that is engaged in 
and is executing a New Construction EDGE Project for a 
Taxpayer, pursuant to a New Construction EDGE Agreement shall: 
        (1) make and keep, for a period of 5 years from the 
    date of the last payment made on or after the effective 
    date of this amendatory Act of the 101st General Assembly 
    on a contract or subcontract for a New Construction EDGE 
    Project pursuant to a New Construction EDGE Agreement, 
    records of all laborers and other workers employed by the 
    contractor or subcontractor on the project; the records 
    shall include: 
            (A) the worker's name; 
            (B) the worker's address; 
            (C) the worker's telephone number, if available; 
            (D) the worker's social security number; 
            (E) the worker's classification or 
        classifications; 
            (F) the worker's gross and net wages paid in each 
        pay period; 
            (G) the worker's number of hours worked each day; 
            (H) the worker's starting and ending times of work 
        each day; 
            (I) the worker's hourly wage rate; and 
            (J) the worker's hourly overtime wage rate; and 
        (2) no later than the 15th day of each calendar month, 
    provide a certified payroll for the immediately preceding 
    month to the taxpayer in charge of the project; within 5 
    business days after receiving the certified payroll, the 
    taxpayer shall file the certified payroll with the 
    Department of Labor and the Department of Commerce and 
    Economic Opportunity; a certified payroll must be filed for 
    only those calendar months during which construction on a 
    New Construction EDGE Project has occurred; the certified 
    payroll shall consist of a complete copy of the records 
    identified in paragraph (1), but may exclude the starting 
    and ending times of work each day; the certified payroll 
    shall be accompanied by a statement signed by the 
    contractor or subcontractor or an officer, employee, or 
    agent of the contractor or subcontractor which avers that: 
            (A) he or she has examined the certified payroll 
        records required to be submitted by the Act and such 
        records are true and accurate; and 
            (B) the contractor or subcontractor is aware that 
        filing a certified payroll that he or she knows to be 
        false is a Class A misdemeanor. 
    A general contractor is not prohibited from relying on a 
certified payroll of a lower-tier subcontractor, provided the 
general contractor does not knowingly rely upon a 
subcontractor's false certification. 
    Any contractor or subcontractor subject to this Section, 
and any officer, employee, or agent of such contractor or 
subcontractor whose duty as an officer, employee, or agent it 
is to file a certified payroll under this Section, who 
willfully fails to file such a certified payroll on or before 
the date such certified payroll is required to be filed and any 
person who willfully files a false certified payroll that is 
false as to any material fact is in violation of this Act and 
guilty of a Class A misdemeanor. 
    The taxpayer in charge of the project shall keep the 
records submitted in accordance with this subsection on or 
after the effective date of this amendatory Act of the 101st 
General Assembly for a period of 5 years from the date of the 
last payment for work on a contract or subcontract for the 
project. 
    The records submitted in accordance with this subsection 
shall be considered public records, except an employee's 
address, telephone number, and social security number, and made 
available in accordance with the Freedom of Information Act. 
The Department of Labor shall accept any reasonable submissions 
by the contractor that meet the requirements of this subsection 
and shall share the information with the Department in order to 
comply with the awarding of New Construction EDGE Credits. A 
contractor, subcontractor, or public body may retain records 
required under this Section in paper or electronic format. 
    Upon 7 business days' notice, the contractor and each 
subcontractor shall make available for inspection and copying 
at a location within this State during reasonable hours, the 
records identified in paragraph (1) of this subsection to the 
taxpayer in charge of the project, its officers and agents, the 
Director of Labor and his deputies and agents, and to federal, 
State, or local law enforcement agencies and prosecutors. 
 
    Section 20-20. The River Edge Redevelopment Zone Act is 
amended  by changing Section 10-3 and  by adding Sections 10-10.3 
and 10-10.4 as follows:
 
    (65 ILCS 115/10-3)

    Sec. 10-3. Definitions.  As used in this Act:
    "Department" means the Department of Commerce and Economic 
Opportunity.
    "River Edge Redevelopment Zone" means an area of the State 
certified by the Department as a River Edge Redevelopment Zone 
pursuant to this Act.
    "Designated zone organization" means an association or 
entity: (1) the members of which are substantially all 
residents of the River Edge Redevelopment Zone or of the 
municipality in which the River Edge Redevelopment Zone is 
located; (2) the board of directors of which is elected by the 
members of the organization; (3) that satisfies the criteria 
set forth in Section 501(c) (3) or 501(c) (4) of the Internal 
Revenue Code; and (4) that exists primarily for the purpose of 
performing within the zone, for the benefit of the residents 
and businesses thereof, any of the functions set forth in 
Section 8 of this Act.
    "Incremental income tax" means the total amount withheld 
during the taxable year from the compensation of River Edge 
Construction Jobs Employees. 
    "Agency" means: each officer, board, commission, and 
agency created by the Constitution, in the executive branch of 
State government, other than the State Board of Elections; each 
officer, department, board, commission, agency, institution, 
authority, university, and body politic and corporate of the 
State; each administrative unit or corporate outgrowth of the 
State government that is created by or pursuant to statute, 
other than units of local government and their officers, school 
districts, and boards of election commissioners; and each 
administrative unit or corporate outgrowth of the above and as 
may be created by executive order of the Governor. No entity is 
an "agency" for the purposes of this Act unless the entity is 
authorized by law to make rules or regulations.
    "River Edge construction jobs credit" means an amount equal 
to 50% of the incremental income tax attributable to River Edge 
construction employees employed on a River Edge construction 
jobs project. However, the amount may equal 75% of the 
incremental income tax attributable to River Edge construction 
employees employed on a River Edge construction jobs project 
located in an underserved area. The total aggregate amount of 
credits awarded under the Blue Collar Jobs Act (Article 20 of 
this amendatory Act of the 101st General Assembly) shall not 
exceed $20,000,000 in any State fiscal year. 
    "River Edge construction jobs employee" means a laborer or 
worker who is employed by an Illinois contractor or 
subcontractor in the actual construction work on the site of a 
River Edge construction jobs project. 
    "River Edge construction jobs project" means building a 
structure or building, or making improvements of any kind to 
real property, in a River Edge Redevelopment Zone that is built 
or improved in the course of completing a qualified 
rehabilitation plan. "River Edge construction jobs project" 
does not include the routine operation, routine repair, or 
routine maintenance of existing structures, buildings, or real 
property. 
    "Rule" means each agency statement of general 
applicability that implements, applies, interprets, or 
prescribes law or policy, but does not include (i) statements 
concerning only the internal management of an agency and not 
affecting private rights or procedures available to persons or 
entities outside the agency, (ii) intra-agency memoranda, or 
(iii) the prescription of standardized forms.

    "Underserved area" means a geographic area that meets one 
or more of the following conditions:
        (1) the area has a poverty rate of at least 20% 
    according to the latest federal decennial census; 
        (2) 75% or more of the children in the area participate 
    in the federal free lunch program according to reported 
    statistics from the State Board of Education; 
        (3) at least 20% of the households in the area receive 
    assistance under the Supplemental Nutrition Assistance 
    Program (SNAP); or 
        (4) the area has an average unemployment rate, as 
    determined by the Illinois Department of Employment 
    Security, that is more than 120% of the national 
    unemployment average, as determined by the U.S. Department 
    of Labor, for a period of at least 2 consecutive calendar 
    years preceding the date of the application. 
(Source: P.A. 94-1021, eff. 7-12-06.)
 
    (65 ILCS 115/10-10.3 new)
    Sec. 10-10.3. River Edge Construction Jobs Credit.
    (a) Beginning on January 1, 2021, a business entity may 
receive a tax credit against the tax imposed under subsections 
(a) and (b) of Section 201 in an amount equal to 50% (or 75% if 
the project is located in an underserved area) of the amount of 
the incremental income tax attributable to River Edge 
construction jobs employees employed in the course of 
completing a River Edge construction jobs project. The credit 
allowed under this Section shall apply only to taxpayers that 
make a capital investment of at least $1,000,000 in a qualified 
rehabilitation plan. 
    (b) A business entity seeking a credit under this Section 
must submit an application to the Department describing the 
nature and benefit of the River Edge construction jobs project 
to the qualified rehabilitation project and the River Edge 
Redevelopment Zone. The Department may adopt any necessary 
rules in order to administer the provisions of this Section. 
    (c) Within 45 days after the receipt of an application, the 
Department shall give notice to the applicant as to whether the 
application has been approved or disapproved. If the Department 
disapproves the application, it shall specify the reasons for 
this decision and allow 60 days for the applicant to amend and 
resubmit its application. The Department shall provide 
assistance upon request to applicants. Resubmitted 
applications shall receive the Department's approval or 
disapproval within 30 days of resubmission. Those resubmitted 
applications satisfying initial Department objectives shall be 
approved unless reasonable circumstances warrant disapproval. 
    (d) On an annual basis, the designated zone organization 
shall furnish a statement to the Department on the programmatic 
and financial status of any approved project and an audited 
financial statement of the project. 
    (e) The Department shall certify to the Department of 
Revenue the identity of the taxpayers who are eligible for 
River Edge construction jobs credits and the amounts of River 
Edge construction jobs credits awarded in each taxable year. 
    (f) The Department, in collaboration with the Department of 
Labor, shall require certified payroll reporting, pursuant to 
Section 10-10.4 of this Act, be completed in order to verify 
the wages and any other necessary information which the 
Department may deem necessary to ascertain and certify the 
total number of River Edge construction jobs employees and 
determine the amount of a River Edge construction jobs credit. 
    (g) The total aggregate amount of credits awarded under the 
Blue Collar Jobs Act (Article 20 of this amendatory Act of the 
101st General Assembly) shall not exceed $20,000,000 in any 
State fiscal year. 
 
    (65 ILCS 115/10-10.4 new)
    Sec. 10-10.4. Certified payroll.
    (a) Any contractor and each subcontractor who is engaged in 
and is executing a River Edge construction jobs project for a 
taxpayer that is entitled to a credit pursuant to Section 
10-10.3 of this Act shall: 
        (1) make and keep, for a period of 5 years from the 
    date of the last payment made on or after the effective 
    date of this amendatory Act of the 101st General Assembly 
    on a contract or subcontract for a River Edge Construction 
    Jobs Project in a River Edge Redevelopment Zone records of 
    all laborers and other workers employed by them on the 
    project; the records shall include: 
            (A) the worker's name; 
            (B) the worker's address; 
            (C) the worker's telephone number, if available; 
            (D) the worker's social security number; 
            (E) the worker's classification or 
        classifications; 
            (F) the worker's gross and net wages paid in each 
        pay period; 
            (G) the worker's number of hours worked each day; 
            (H) the worker's starting and ending times of work 
        each day; 
            (I) the worker's hourly wage rate; and 
            (J) the worker's hourly overtime wage rate; 
        (2) no later than the 15th day of each calendar month, 
    provide a certified payroll for the immediately preceding 
    month to the taxpayer in charge of the project; within 5 
    business days after receiving the certified payroll, the 
    taxpayer shall file the certified payroll with the 
    Department of Labor and the Department of Commerce and 
    Economic Opportunity; a certified payroll must be filed for 
    only those calendar months during which construction on a 
    River Edge Construction Jobs Project has occurred; the 
    certified payroll shall consist of a complete copy of the 
    records identified in paragraph (1), but may exclude the 
    starting and ending times of work each day; the certified 
    payroll shall be accompanied by a statement signed by the 
    contractor or subcontractor or an officer, employee, or 
    agent of the contractor or subcontractor which avers that: 
            (A) he or she has examined the certified payroll 
        records required to be submitted and such records are 
        true and accurate; and 
            (B) the contractor or subcontractor is aware that 
        filing a certified payroll that he or she knows to be 
        false is a Class A misdemeanor. 
    A general contractor is not prohibited from relying on a 
certified payroll of a lower-tier subcontractor, provided the 
general contractor does not knowingly rely upon a 
subcontractor's false certification. 
    Any contractor or subcontractor subject to this Section, 
and any officer, employee, or agent of such contractor or 
subcontractor whose duty as an officer, employee, or agent it 
is to file a certified payroll under this Section, who 
willfully fails to file such a certified payroll on or before 
the date such certified payroll is required to be filed and any 
person who willfully files a false certified payroll that is 
false as to any material fact is in violation of this Act and 
guilty of a Class A misdemeanor. 
    The taxpayer in charge of the project shall keep the 
records submitted in accordance with this Section on or after 
the effective date of this amendatory Act of the 101st General 
Assembly for a period of 5 years from the date of the last 
payment for work on a contract or subcontract for the project. 
    The records submitted in accordance with this subsection 
shall be considered public records, except an employee's 
address, telephone number, and social security number, and made 
available in accordance with the Freedom of Information Act. 
The Department of Labor shall accept any reasonable submissions 
by the contractor that meet the requirements of this subsection 
and shall share the information with the Department in order to 
comply with the awarding of River Edge construction jobs 
credits. A contractor, subcontractor, or public body may retain 
records required under this Section in paper or electronic 
format. 
    Upon 7 business days' notice, the contractor and each 
subcontractor shall make available for inspection and copying 
at a location within this State during reasonable hours, the 
records identified in paragraph (1) of this subsection to the 
taxpayer in charge of the project, its officers and agents, the 
Director of Labor and his deputies and agents, and to federal, 
State, or local law enforcement agencies and prosecutors. 
 
ARTICLE 25.  MANUFACTURING MACHINERY AND EQUIPMENT

 
    Section 25-5. The Use Tax Act is amended  by changing 
Sections 3-5 and 3-50 as follows:
 


    (35 ILCS 105/3-5)


    Sec. 3-5. Exemptions. Use of the following tangible 
personal property is exempt from the tax imposed by this Act:

    (1) Personal property purchased from a corporation, 
society, association,
foundation, institution, or 
organization, other than a limited liability
company, that is 
organized and operated as a not-for-profit service enterprise

for the benefit of persons 65 years of age or older if the 
personal property was not purchased by the enterprise for the 
purpose of resale by the
enterprise.

    (2) Personal property purchased by a not-for-profit 
Illinois county
fair association for use in conducting, 
operating, or promoting the
county fair.

    (3) Personal property purchased by a not-for-profit
arts or 
cultural organization that establishes, by proof required by 
the
Department by
rule, that it has received an exemption under 
Section 501(c)(3) of the Internal
Revenue Code and that is 
organized and operated primarily for the
presentation
or 
support of arts or cultural programming, activities, or 
services.  These
organizations include, but are not limited to, 
music and dramatic arts
organizations such as symphony 
orchestras and theatrical groups, arts and
cultural service 
organizations, local arts councils, visual arts organizations,

and media arts organizations.
On and after July 1, 2001 (the 
effective date of Public Act 92-35), however, an entity 
otherwise eligible for this exemption shall not
make tax-free 
purchases unless it has an active identification number issued 
by
the Department.

    (4) Personal property purchased by a governmental body, by 
a
corporation, society, association, foundation, or 
institution organized and
operated exclusively for charitable, 
religious, or educational purposes, or
by a not-for-profit 
corporation, society, association, foundation,
institution, or 
organization that has no compensated officers or employees
and 
that is organized and operated primarily for the recreation of 
persons
55 years of age or older. A limited liability company 
may qualify for the
exemption under this paragraph only if the 
limited liability company is
organized and operated 
exclusively for educational purposes. On and after July
1, 
1987, however, no entity otherwise eligible for this exemption 
shall make
tax-free purchases unless it has an active exemption 
identification number
issued by the Department.

    (5) Until July 1, 2003, a passenger car that is a 
replacement vehicle to
the extent that the
purchase price of 
the car is subject to the Replacement Vehicle Tax.

    (6) Until July 1, 2003 and beginning again on September 1, 
2004 through August 30, 2014, graphic arts machinery and 
equipment, including
repair and replacement
parts, both new and 
used, and including that manufactured on special order,

certified by the purchaser to be used primarily for graphic 
arts production,
and including machinery and equipment 
purchased for lease.
 Equipment includes chemicals or chemicals 
acting as catalysts but only if
the
chemicals or chemicals 
acting as catalysts effect a direct and immediate change
upon a 
graphic arts product. Beginning on July 1, 2017, graphic arts 
machinery and equipment is included in the manufacturing and 
assembling machinery and equipment exemption under paragraph 
(18). 

    (7) Farm chemicals.

    (8) Legal tender, currency, medallions, or gold or silver 
coinage issued by
the State of Illinois, the government of the 
United States of America, or the
government of any foreign 
country, and bullion.

    (9) Personal property purchased from a teacher-sponsored 
student
organization affiliated with an elementary or 
secondary school located in
Illinois.

    (10) A motor vehicle that is used for automobile renting, 
as defined in the
Automobile Renting Occupation and Use Tax 
Act.

    (11) Farm machinery and equipment, both new and used,

including that manufactured on special order, certified by the 
purchaser
to be used primarily for production agriculture or 
State or federal
agricultural programs, including individual 
replacement parts for
the machinery and equipment, including 
machinery and equipment
purchased
for lease,
and including 
implements of husbandry defined in Section 1-130 of
the 
Illinois Vehicle Code, farm machinery and agricultural 
chemical and
fertilizer spreaders, and nurse wagons required to 
be registered
under Section 3-809 of the Illinois Vehicle Code,

but excluding other motor
vehicles required to be
registered 
under the Illinois Vehicle Code.
Horticultural polyhouses or 
hoop houses used for propagating, growing, or
overwintering 
plants shall be considered farm machinery and equipment under

this item (11).
Agricultural chemical tender tanks and dry 
boxes shall include units sold
separately from a motor vehicle 
required to be licensed and units sold mounted
on a motor 
vehicle required to be licensed if the selling price of the 
tender
is separately stated.

    Farm machinery and equipment shall include precision 
farming equipment
that is
installed or purchased to be 
installed on farm machinery and equipment
including, but not 
limited to, tractors, harvesters, sprayers, planters,
seeders, 
or spreaders.
Precision farming equipment includes, but is not 
limited to, soil testing
sensors, computers, monitors, 
software, global positioning
and mapping systems, and other 
such equipment.

    Farm machinery and equipment also includes computers, 
sensors, software, and
related equipment used primarily in the

computer-assisted operation of production agriculture 
facilities, equipment,
and
activities such as, but not limited 
to,
the collection, monitoring, and correlation of
animal and 
crop data for the purpose of
formulating animal diets and 
agricultural chemicals.  This item (11) is exempt
from the 
provisions of
Section 3-90.

    (12) Until June 30, 2013, fuel and petroleum products sold 
to or used by an air common
carrier, certified by the carrier 
to be used for consumption, shipment, or
storage in the conduct 
of its business as an air common carrier, for a
flight destined 
for or returning from a location or locations
outside the 
United States without regard to previous or subsequent domestic

stopovers.

    Beginning July 1, 2013, fuel and petroleum products sold to 
or used by an air carrier, certified by the carrier to be used 
for consumption, shipment, or storage in the conduct of its 
business as an air common carrier, for a flight that (i) is 
engaged in foreign trade or is engaged in trade between the 
United States and any of its possessions and (ii) transports at 
least one individual or package for hire from the city of 
origination to the city of final destination on the same 
aircraft, without regard to a change in the flight number of 
that aircraft. 
    (13) Proceeds of mandatory service charges separately

stated on customers' bills for the purchase and consumption of 
food and
beverages purchased at retail from a retailer, to the 
extent that the proceeds
of the service charge are in fact 
turned over as tips or as a substitute
for tips to the 
employees who participate directly in preparing, serving,

hosting or cleaning up the food or beverage function with 
respect to which
the service charge is imposed.

    (14) Until July 1, 2003, oil field exploration, drilling, 
and production
equipment,
including (i) rigs and parts of rigs, 
rotary
rigs, cable tool rigs, and workover rigs, (ii) pipe and 
tubular goods,
including casing and drill strings, (iii) pumps 
and pump-jack units, (iv)
storage tanks and flow lines, (v) any 
individual replacement part for oil
field exploration, 
drilling, and production equipment, and (vi) machinery and

equipment purchased
for lease; but excluding motor vehicles 
required to be registered under the
Illinois Vehicle Code.

    (15) Photoprocessing machinery and equipment, including 
repair and
replacement parts, both new and used, including that

manufactured on special order, certified by the purchaser to be 
used
primarily for photoprocessing, and including

photoprocessing machinery and equipment purchased for lease.

    (16) Until July 1, 2023, coal and aggregate exploration, 
mining, off-highway hauling,
processing, maintenance, and 
reclamation equipment,
including replacement parts and 
equipment, and
including equipment purchased for lease, but 
excluding motor
vehicles required to be registered under the 
Illinois Vehicle Code. The changes made to this Section by 
Public Act 97-767 apply on and after July 1, 2003, but no claim 
for credit or refund is allowed on or after August 16, 2013 
(the effective date of Public Act 98-456)
 for such taxes paid 
during the period beginning July 1, 2003 and ending  on August 
16, 2013 (the effective date of Public Act 98-456). 

    (17) Until July 1, 2003, distillation machinery and 
equipment, sold as a
unit or kit,
assembled or installed by the 
retailer, certified by the user to be used
only for the 
production of ethyl alcohol that will be used for consumption

as motor fuel or as a component of motor fuel for the personal 
use of the
user, and not subject to sale or resale.

    (18) Manufacturing and assembling machinery and equipment 
used
primarily in the process of manufacturing or assembling 
tangible
personal property for wholesale or retail sale or 
lease, whether that sale
or lease is made directly by the 
manufacturer or by some other person,
whether the materials 
used in the process are
owned by the manufacturer or some other 
person, or whether that sale or
lease is made apart from or as 
an incident to the seller's engaging in
the service occupation 
of producing machines, tools, dies, jigs,
patterns, gauges, or 
other similar items of no commercial value on
special order for 
a particular purchaser. The exemption provided by this 
paragraph (18) includes production related tangible personal 
property, as defined in Section 3-50, purchased on or after 
July 1, 2019. The exemption provided by this paragraph (18) 
does not include machinery and equipment used in (i) the 
generation of electricity for wholesale or retail sale; (ii) 
the generation or treatment of natural or artificial gas for 
wholesale or retail sale that is delivered to customers through 
pipes, pipelines, or mains; or (iii) the treatment of water for 
wholesale or retail sale that is delivered to customers through 
pipes, pipelines, or mains.    The provisions of Public Act 98-583 
are declaratory of existing law as to the meaning and scope of 
this exemption. Beginning on July 1, 2017, the exemption 
provided by this paragraph (18) includes, but is not limited 
to, graphic arts machinery and equipment, as defined in 
paragraph (6) of this Section. 

    (19) Personal property delivered to a purchaser or 
purchaser's donee
inside Illinois when the purchase order for 
that personal property was
received by a florist located 
outside Illinois who has a florist located
inside Illinois 
deliver the personal property.

    (20) Semen used for artificial insemination of livestock 
for direct
agricultural production.

    (21) Horses, or interests in horses, registered with and 
meeting the
requirements of any of the
Arabian Horse Club 
Registry of America, Appaloosa Horse Club, American Quarter

Horse Association, United States
Trotting Association, or 
Jockey Club, as appropriate, used for
purposes of breeding or 
racing for prizes. This item (21) is exempt from the provisions 
of Section 3-90, and the exemption provided for under this item 
(21) applies for all periods beginning May 30, 1995, but no 
claim for credit or refund is allowed on or after January 1, 
2008
 for such taxes paid during the period beginning May 30, 
2000 and ending on January 1, 2008.


    (22) Computers and communications equipment utilized for 
any
hospital
purpose
and equipment used in the diagnosis,

analysis, or treatment of hospital patients purchased by a 
lessor who leases
the
equipment, under a lease of one year or 
longer executed or in effect at the
time the lessor would 
otherwise be subject to the tax imposed by this Act, to a

hospital
 that has been issued an active tax exemption 
identification number by
the
Department under Section 1g of the 
Retailers' Occupation Tax Act.  If the
equipment is leased in a 
manner that does not qualify for
this exemption or is used in 
any other non-exempt manner, the lessor
shall be liable for the

tax imposed under this Act or the Service Use Tax Act, as the 
case may
be, based on the fair market value of the property at 
the time the
non-qualifying use occurs.  No lessor shall collect 
or attempt to collect an
amount (however
designated) that 
purports to reimburse that lessor for the tax imposed by this

Act or the Service Use Tax Act, as the case may be, if the tax 
has not been
paid by the lessor.  If a lessor improperly 
collects any such amount from the
lessee, the lessee shall have 
a legal right to claim a refund of that amount
from the lessor.  
If, however, that amount is not refunded to the lessee for
any 
reason, the lessor is liable to pay that amount to the 
Department.

    (23) Personal property purchased by a lessor who leases the

property, under
a
lease of
 one year or longer executed or in 
effect at the time
the lessor would otherwise be subject to the 
tax imposed by this Act,
to a governmental body
that has been 
issued an active sales tax exemption identification number by 
the
Department under Section 1g of the Retailers' Occupation 
Tax Act.
If the
property is leased in a manner that does not 
qualify for
this exemption
or used in any other non-exempt 
manner, the lessor shall be liable for the
tax imposed under 
this Act or the Service Use Tax Act, as the case may
be, based 
on the fair market value of the property at the time the

non-qualifying use occurs.  No lessor shall collect or attempt 
to collect an
amount (however
designated) that purports to 
reimburse that lessor for the tax imposed by this
Act or the 
Service Use Tax Act, as the case may be, if the tax has not been

paid by the lessor.  If a lessor improperly collects any such 
amount from the
lessee, the lessee shall have a legal right to 
claim a refund of that amount
from the lessor.  If, however, 
that amount is not refunded to the lessee for
any reason, the 
lessor is liable to pay that amount to the Department.

    (24) Beginning with taxable years ending on or after 
December
31, 1995
and
ending with taxable years ending on or 
before December 31, 2004,
personal property that is
donated for 
disaster relief to be used in a State or federally declared

disaster area in Illinois or bordering Illinois by a 
manufacturer or retailer
that is registered in this State to a 
corporation, society, association,
foundation, or institution 
that has been issued a sales tax exemption
identification 
number by the Department that assists victims of the disaster

who reside within the declared disaster area.

    (25) Beginning with taxable years ending on or after 
December
31, 1995 and
ending with taxable years ending on or 
before December 31, 2004, personal
property that is used in the 
performance of infrastructure repairs in this
State, including 
but not limited to municipal roads and streets, access roads,

bridges, sidewalks, waste disposal systems, water and sewer 
line extensions,
water distribution and purification 
facilities, storm water drainage and
retention facilities, and 
sewage treatment facilities, resulting from a State
or 
federally declared disaster in Illinois or bordering Illinois 
when such
repairs are initiated on facilities located in the 
declared disaster area
within 6 months after the disaster.

    (26) Beginning July 1, 1999, game or game birds purchased 
at a "game
breeding
and hunting preserve area" as that term is

used in
the Wildlife Code.  This paragraph is exempt from the 
provisions
of
Section 3-90.

    (27) A motor vehicle, as that term is defined in Section 
1-146
of the
Illinois
Vehicle Code, that is donated to a 
corporation, limited liability company,
society, association, 
foundation, or institution that is determined by the
Department 
to be organized and operated exclusively for educational 
purposes.
For purposes of this exemption, "a corporation, 
limited liability company,
society, association, foundation, 
or institution organized and operated
exclusively for 
educational purposes" means all tax-supported public schools,

private schools that offer systematic instruction in useful 
branches of
learning by methods common to public schools and 
that compare favorably in
their scope and intensity with the 
course of study presented in tax-supported
schools, and 
vocational or technical schools or institutes organized and

operated exclusively to provide a course of study of not less 
than 6 weeks
duration and designed to prepare individuals to 
follow a trade or to pursue a
manual, technical, mechanical, 
industrial, business, or commercial
occupation.

    (28) Beginning January 1, 2000,  personal property, 
including
food,
purchased through fundraising
events for the 
benefit of
a public or private elementary or
secondary school, 
a group of those schools, or one or more school
districts if 
the events are
sponsored by an entity recognized by the school 
district that consists
primarily of volunteers and includes

parents and teachers of the school children.  This paragraph 
does not apply
to fundraising
events (i) for the benefit of 
private home instruction or (ii)
for which the fundraising 
entity purchases the personal property sold at
the events from 
another individual or entity that sold the property for the

purpose of resale by the fundraising entity and that
profits 
from the sale to the
fundraising entity.  This paragraph is 
exempt
from the provisions
of Section 3-90.

    (29) Beginning January 1, 2000 and through December 31, 
2001, new or
used automatic vending
machines that prepare and 
serve hot food and beverages, including coffee, soup,
and
other 
items, and replacement parts for these machines.
Beginning 
January 1,
2002 and through June 30, 2003, machines and parts 
for machines used in
commercial, coin-operated amusement and 
vending business if a use or occupation
tax is paid on the 
gross receipts derived from the use of the commercial,

coin-operated amusement and vending machines.
This
paragraph

is exempt from the provisions of Section 3-90.

    (30) Beginning January 1, 2001 and through June 30, 2016, 
food for human consumption that is to be consumed off the 
premises
where it is sold (other than alcoholic beverages, soft 
drinks, and food that
has been prepared for immediate 
consumption) and prescription and
nonprescription medicines, 
drugs, medical appliances, and insulin, urine
testing 
materials, syringes, and needles used by diabetics, for human 
use, when
purchased for use by a person receiving medical 
assistance under Article V of
the Illinois Public Aid Code who 
resides in a licensed long-term care facility,
as defined in 
the Nursing Home Care Act, or in a licensed facility as defined 
in the ID/DD Community Care Act, the MC/DD Act, or the 
Specialized Mental Health Rehabilitation Act of 2013.

    (31) Beginning on August 2, 2001 (the effective date of 
Public Act 92-227),
computers and communications equipment

utilized for any hospital purpose and equipment used in the 
diagnosis,
analysis, or treatment of hospital patients 
purchased by a lessor who leases
the equipment, under a lease 
of one year or longer executed or in effect at the
time the 
lessor would otherwise be subject to the tax imposed by this 
Act, to a
hospital that has been issued an active tax exemption 
identification number by
the Department under Section 1g of the 
Retailers' Occupation Tax Act.  If the
equipment is leased in a 
manner that does not qualify for this exemption or is
used in 
any other nonexempt manner, the lessor shall be liable for the 
tax
imposed under this Act or the Service Use Tax Act, as the 
case may be, based on
the fair market value of the property at 
the time the nonqualifying use
occurs.  No lessor shall collect 
or attempt to collect an amount (however
designated) that 
purports to reimburse that lessor for the tax imposed by this

Act or the Service Use Tax Act, as the case may be, if the tax 
has not been
paid by the lessor.  If a lessor improperly 
collects any such amount from the
lessee, the lessee shall have 
a legal right to claim a refund of that amount
from the lessor.  
If, however, that amount is not refunded to the lessee for
any 
reason, the lessor is liable to pay that amount to the 
Department.
This paragraph is exempt from the provisions of 
Section 3-90.

    (32) Beginning on August 2, 2001 (the effective date of 
Public Act 92-227),
personal property purchased by a lessor who 
leases the property,
under a lease of one year or longer 
executed or in effect at the time the
lessor would otherwise be 
subject to the tax imposed by this Act, to a
governmental body 
that has been issued an active sales tax exemption

identification number by the Department under Section 1g of the 
Retailers'
Occupation Tax Act.  If the property is leased in a 
manner that does not
qualify for this exemption or used in any 
other nonexempt manner, the lessor
shall be liable for the tax 
imposed under this Act or the Service Use Tax Act,
as the case 
may be, based on the fair market value of the property at the 
time
the nonqualifying use occurs.  No lessor shall collect or 
attempt to collect
an amount (however designated) that purports 
to reimburse that lessor for the
tax imposed by this Act or the 
Service Use Tax Act, as the case may be, if the
tax has not been 
paid by the lessor.  If a lessor improperly collects any such

amount from the lessee, the lessee shall have a legal right to 
claim a refund
of that amount from the lessor.  If, however, 
that amount is not refunded to
the lessee for any reason, the 
lessor is liable to pay that amount to the
Department.  This 
paragraph is exempt from the provisions of Section 3-90.

    (33) On and after July 1, 2003 and through June 30, 2004, 
the use in this State of motor vehicles of
the second division 
with a gross vehicle weight in excess of 8,000 pounds and
that 
are subject to the commercial distribution fee imposed under 
Section
3-815.1 of the Illinois Vehicle Code. Beginning on July 
1, 2004 and through June 30, 2005, the use in this State of 
motor vehicles of the second division: (i) with a gross vehicle 
weight rating in excess of 8,000 pounds; (ii) that are subject 
to the commercial distribution fee imposed under Section 
3-815.1 of the Illinois Vehicle Code; and (iii) that are 
primarily used for commercial purposes. Through June 30, 2005, 
this exemption applies to repair and
replacement parts added 
after the initial purchase of such a motor vehicle if
that 
motor
vehicle is used in a manner that would qualify for the 
rolling stock exemption
otherwise provided for in this Act. For 
purposes of this paragraph, the term "used for commercial 
purposes" means the transportation of persons or property in 
furtherance of any commercial or industrial enterprise, 
whether for-hire or not.


    (34) Beginning January 1, 2008, tangible personal property 
used in the construction or maintenance of a community water 
supply, as defined under Section 3.145 of the Environmental 
Protection Act, that is operated by a not-for-profit 
corporation that holds a valid water supply permit issued under 
Title IV of the Environmental Protection Act. This paragraph is 
exempt from the provisions of Section 3-90.
    (35) Beginning January 1, 2010, materials, parts, 
equipment, components, and furnishings incorporated into or 
upon an aircraft as part of the modification, refurbishment, 
completion, replacement, repair, or maintenance of the 
aircraft. This exemption includes consumable supplies used in 
the modification, refurbishment, completion, replacement, 
repair, and maintenance of aircraft, but excludes any 
materials, parts, equipment, components, and consumable 
supplies used in the modification, replacement, repair, and 
maintenance of aircraft engines or power plants, whether such 
engines or power plants are installed or uninstalled upon any 
such aircraft. "Consumable supplies" include, but are not 
limited to, adhesive, tape, sandpaper, general purpose 
lubricants, cleaning solution, latex gloves, and protective 
films. This exemption applies only to the use of qualifying 
tangible personal property by persons who modify, refurbish, 
complete, repair, replace, or maintain aircraft and who (i) 
hold an Air Agency Certificate and are empowered to operate an 
approved repair station by the Federal Aviation 
Administration, (ii) have a Class IV Rating, and (iii) conduct 
operations in accordance with Part 145 of the Federal Aviation 
Regulations. The exemption does not include aircraft operated 
by a commercial air carrier providing scheduled passenger air 
service pursuant to authority issued under Part 121 or Part 129 
of the Federal Aviation Regulations. The changes made to this 
paragraph (35) by Public Act 98-534 are declarative of existing 
law. 
    (36) Tangible personal property purchased by a 
public-facilities corporation, as described in Section 
11-65-10 of the Illinois Municipal Code, for purposes of 
constructing or furnishing a municipal convention hall, but 
only if the legal title to the municipal convention hall is 
transferred to the municipality without any further 
consideration by or on behalf of the municipality at the time 
of the completion of the municipal convention hall or upon the 
retirement or redemption of any bonds or other debt instruments 
issued by the public-facilities corporation in connection with 
the development of the municipal convention hall.  This 
exemption includes existing public-facilities corporations as 
provided in Section 11-65-25 of the Illinois Municipal Code.  
This paragraph is exempt from the provisions of Section 3-90. 
    (37) Beginning January 1, 2017, menstrual pads, tampons, 
and menstrual cups. 
    (38) Merchandise that is subject to the Rental Purchase 
Agreement Occupation and Use Tax.  The purchaser must certify 
that the item is purchased to be rented subject to a rental 
purchase agreement, as defined in the Rental Purchase Agreement 
Act, and provide proof of registration under the Rental 
Purchase Agreement Occupation and Use Tax Act. This paragraph 
is exempt from the provisions of Section 3-90.
    (39) Tangible personal property purchased by a purchaser 
who is exempt from the tax imposed by this Act by operation of 
federal law. This paragraph  is exempt from the provisions of 
Section 3-90.
(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16; 
100-22, eff. 7-6-17; 100-437, eff. 1-1-18; 100-594, eff. 
6-29-18; 100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; revised 
1-8-19.)

 



    (35 ILCS 105/3-50)  (from Ch. 120, par. 439.3-50)


    Sec. 3-50. Manufacturing and assembly exemption. The 
manufacturing
and assembling machinery and equipment exemption 
includes
machinery and equipment that replaces machinery and 
equipment in an
existing manufacturing facility as well as 
machinery and equipment that
are for use in an expanded or new 
manufacturing facility. The machinery and
equipment exemption 
also includes machinery and equipment used in the
general 
maintenance or repair of exempt machinery and equipment or for

in-house manufacture of exempt machinery and equipment. 
Beginning on July 1, 2017, the manufacturing and assembling 
machinery and equipment exemption also includes graphic arts 
machinery and equipment, as defined in paragraph (6) of Section 
3-5. The machinery and equipment exemption does not include 
machinery and equipment used in (i) the generation of 
electricity for wholesale or retail sale; (ii) the generation 
or treatment of natural or artificial gas for wholesale or 
retail sale that is delivered to customers through pipes, 
pipelines, or mains; or (iii)  the treatment of water for 
wholesale or retail sale that is delivered to customers through 
pipes, pipelines, or mains.      The provisions of this amendatory 
Act of the 98th General Assembly are declaratory of existing 
law as to the meaning and scope of this exemption. For the

purposes of this exemption, terms have the following
meanings:

        (1) "Manufacturing process" means the production of
an 
    article of tangible personal property, whether the article

    is a finished product or an article for use in the process 
    of manufacturing
or assembling a different article of 
    tangible personal property, by
a procedure commonly 
    regarded as manufacturing, processing, fabricating, or

    refining that changes some existing material into a 
    material
with a different form, use, or name.  In relation 
    to a recognized integrated
business composed of a series of 
    operations that collectively constitute
manufacturing, or 
    individually constitute
manufacturing operations, the 
    manufacturing process commences with the
first operation 
    or stage of production in the series
and does not end until 
    the completion of the final product
in the last operation 
    or stage of production in the series.  For purposes
of this 
    exemption, photoprocessing is a
manufacturing process of 
    tangible personal property for wholesale or retail
sale.

        (2) "Assembling process" means the production of
an 
    article of tangible personal property, whether the article

    is a finished product or an article for use in the process 
    of manufacturing
or assembling a different article of 
    tangible personal property, by the
combination of existing 
    materials in a manner commonly regarded as
assembling that 
    results in an article or material of a different
form, use, 
    or name.

        (3) "Machinery" means major
mechanical machines or 
    major components of those machines contributing to a

    manufacturing or assembling process.

        (4) "Equipment" includes an independent device
or tool 
    separate from machinery but essential to an integrated

    manufacturing or assembly process; including computers 
    used primarily in
a manufacturer's computer assisted 
    design,
computer assisted manufacturing (CAD/CAM) system; 
    any
subunit or assembly comprising a component of any 
    machinery or auxiliary,
adjunct, or attachment parts of 
    machinery, such as tools, dies, jigs,
fixtures, patterns, 
    and molds; and any parts that require
periodic replacement 
    in the course of normal operation; but does not
include 
    hand tools. Equipment includes chemicals or chemicals 
    acting as
catalysts but only if
the chemicals or chemicals 
    acting as catalysts effect a direct and
immediate change 
    upon a
product being manufactured or assembled for 
    wholesale or retail sale or
lease.
        (5) "Production related tangible personal property" 
    means all tangible personal property that is used or 
    consumed by the purchaser in a manufacturing facility in 
    which a manufacturing process takes place and includes, 
    without limitation,  tangible personal property that is 
    purchased for incorporation into real estate within a 
    manufacturing facility, supplies and consumables used in a 
    manufacturing facility including fuels, coolants, 
    solvents, oils, lubricants, and adhesives, hand tools, 
    protective apparel, and fire and safety equipment used or 
    consumed within a manufacturing facility, and tangible 
    personal property that is used or consumed in activities 
    such as research and development, preproduction material 
    handling, receiving, quality control, inventory control, 
    storage, staging, and packaging for shipping and 
    transportation purposes. "Production related tangible 
    personal property" does not include (i) tangible personal 
    property that is used, within or without a manufacturing 
    facility, in sales, purchasing, accounting, fiscal 
    management, marketing, personnel recruitment or selection, 
    or landscaping or (ii) tangible personal property that is 
    required to be titled or registered with a department, 
    agency, or unit of federal, State, or local government. 

    The manufacturing and assembling machinery and equipment 
exemption includes production related tangible personal 
property that is purchased on or after July 1, 2007 and on or 
before June 30, 2008 and on or after July 1, 2019. The 
exemption for production related tangible personal property 
purchased on or after July 1, 2007 and on or before June 30, 
2008 is subject to both of  the following limitations:
        (1) The maximum amount of the exemption for any one 
    taxpayer may not exceed 5% of the purchase price of 
    production related tangible personal property that is 
    purchased on or after July 1, 2007 and on or before June 
    30, 2008. A credit under Section 3-85 of this Act may not 
    be earned by the purchase of production related tangible 
    personal property for which an exemption is received under 
    this Section.
        (2) The maximum aggregate amount of  the exemptions for 
    production related tangible personal property  purchased on 
    or after July 1, 2007 and on or before June 30, 2008 
    awarded under this Act and the Retailers' Occupation Tax 
    Act to all taxpayers may not exceed $10,000,000. If the 
    claims for the exemption exceed $10,000,000, then the 
    Department shall reduce the amount of the exemption to each 
    taxpayer on a pro rata basis.
The Department shall may adopt rules to implement and 
administer the exemption for production related tangible 
personal property. 
    The manufacturing and assembling machinery and equipment

exemption includes the sale of materials to a purchaser who

produces exempted types of machinery, equipment, or tools and 
who rents or
leases that machinery, equipment, or tools to a

manufacturer of tangible
personal property.  This exemption 
also includes the sale of materials to a
purchaser who 
manufactures those materials into an exempted type of

machinery, equipment, or tools that the purchaser uses
himself 
or herself in the
manufacturing of tangible personal property.  
This exemption includes the
sale of exempted types of machinery 
or equipment to a
purchaser who is not the manufacturer, but 
who rents or leases the use of
the property to a manufacturer. 
The purchaser of the machinery and
equipment who has an active 
resale registration number shall
furnish that number to the 
seller at the time of purchase.
A user of the machinery, 
equipment, or tools without an
active resale registration 
number shall prepare a certificate of exemption
for each 
transaction stating facts establishing the exemption for that

transaction, and that certificate shall be
available to the 
Department for inspection or audit. The Department shall

prescribe the form of the certificate. Informal rulings, 
opinions, or
letters issued by the Department in
response to an 
inquiry or request for an opinion from any person
regarding the 
coverage and applicability of this exemption to specific

devices shall be published, maintained as a public record, and 
made
available for public inspection and copying.  If the 
informal ruling,
opinion, or letter contains trade secrets or 
other confidential
information, where possible, the Department 
shall delete that information
before publication.  Whenever 
informal rulings, opinions, or
letters contain a policy of 
general applicability, the Department
shall formulate and 
adopt that policy as a rule in accordance with the
Illinois 
Administrative Procedure Act.

    The manufacturing and assembling machinery and equipment

exemption is exempt from the provisions of Section 3-90. 
(Source: P.A. 100-22, eff. 7-6-17.)

 
    Section 25-10. The Service Use Tax Act is amended  by 
changing Section 2 as follows:
 



    (35 ILCS 110/2)  (from Ch. 120, par. 439.32)



    Sec. 2. Definitions.  In this Act: 
    "Use" means the exercise by any person of any right or 
power
over tangible personal property incident to the ownership 
of that
property, but does not include the sale or use for 
demonstration by him
of that property in any form as tangible 
personal property in the
regular course of business.
"Use" does 
not mean the interim
use of
tangible personal property nor the 
physical incorporation of tangible
personal property, as an 
ingredient or constituent, into other tangible
personal 
property, (a) which is sold in the regular course of business

or (b) which the person incorporating such ingredient or 
constituent
therein has undertaken at the time of such purchase 
to cause to be
transported in interstate commerce to 
destinations outside the State of
Illinois.

    "Purchased from a serviceman" means the acquisition of the 
ownership
of, or title to, tangible personal property through a 
sale of service.

    "Purchaser" means any person who, through a sale of 
service, acquires
the ownership of, or title to, any tangible 
personal property.

    "Cost price" means the consideration paid by the serviceman 
for a
purchase valued in money, whether paid in money or 
otherwise, including
cash, credits and services, and shall be 
determined without any
deduction on account of the supplier's 
cost of the property sold or on
account of any other expense 
incurred by the supplier. When a serviceman
contracts out part 
or all of the services required in his sale of service,
it 
shall be presumed that the cost price to the serviceman of the 
property
transferred to him or her by his or her subcontractor 
is equal to 50% of
the subcontractor's charges to the 
serviceman in the absence of proof of
the consideration paid by 
the subcontractor for the purchase of such property.

    "Selling price" means the consideration for a sale valued 
in money
whether received in money or otherwise, including 
cash, credits and
service, and shall be determined without any 
deduction on account of the
serviceman's cost of the property 
sold, the cost of materials used,
labor or service cost or any 
other expense whatsoever, but does not
include interest or 
finance charges which appear as separate items on
the bill of 
sale or sales contract nor charges that are added to prices
by 
sellers on account of the seller's duty to collect, from the

purchaser, the tax that is imposed by this Act.

    "Department" means the Department of Revenue.

    "Person" means any natural individual, firm, partnership,

association, joint stock company, joint venture, public or 
private
corporation, limited liability company, and any 
receiver, executor, trustee,
guardian or other representative 
appointed by order of any court.

    "Sale of service" means any transaction except:

        (1) a retail sale of tangible personal property taxable 
    under the
Retailers' Occupation Tax Act or under the Use 
    Tax Act.

        (2) a sale of tangible personal property for the 
    purpose of resale
made in compliance with Section 2c of the 
    Retailers' Occupation Tax Act.

        (3) except as hereinafter provided, a sale or transfer 
    of tangible
personal property as an incident to the 
    rendering of service for or by
any governmental body, or 
    for or by any corporation, society,
association, 
    foundation or institution organized and operated

    exclusively for charitable, religious or educational 
    purposes or any
not-for-profit corporation, society, 
    association, foundation,
institution or organization which 
    has no compensated officers or
employees and which is 
    organized and operated primarily for the
recreation of 
    persons 55 years of age or older. A limited liability 
    company
may qualify for the exemption under this paragraph 
    only if the limited
liability company is organized and 
    operated exclusively for educational
purposes.

        (4) (blank).

        (4a) a sale or transfer of tangible personal
property 
    as an incident
to the rendering of service for owners, 
    lessors, or shippers of tangible
personal property which is 
    utilized by interstate carriers for hire for
use as rolling 
    stock moving in interstate commerce so long as so used by

    interstate carriers for hire, and equipment operated by a

    telecommunications provider, licensed as a common carrier 
    by the Federal
Communications Commission, which is 
    permanently installed in or affixed to
aircraft moving in 
    interstate commerce.

        (4a-5) on and after July 1, 2003 and through June 30, 
    2004, a sale or transfer of a motor vehicle
of
the
second 
    division with a gross vehicle weight in excess of 8,000 
    pounds as an
incident to the rendering of service if that 
    motor
vehicle is subject
to the commercial distribution fee 
    imposed under Section 3-815.1 of the
Illinois Vehicle
Code.   
    Beginning on July 1, 2004 and through June 30, 2005, the 
    use in this State of motor vehicles of the second division: 
    (i) with a gross vehicle weight rating in excess of 8,000 
    pounds; (ii) that are subject to the commercial 
    distribution fee imposed under Section 3-815.1 of the 
    Illinois Vehicle Code; and (iii) that are primarily used 
    for commercial purposes. Through June 30, 2005, this


    exemption applies to repair and replacement parts added 
    after the
initial
purchase of such a motor vehicle if that 
    motor vehicle is used in a manner that
would
qualify for 
    the rolling stock exemption otherwise provided for in this 
    Act. For purposes of this paragraph, "used for commercial 
    purposes" means the transportation of persons or property 
    in furtherance of any commercial or industrial enterprise 
    whether for-hire or not.


        (5) a sale or transfer of machinery and equipment used 
    primarily in the
process of the manufacturing or 
    assembling, either in an existing, an expanded
or a new 
    manufacturing facility, of tangible personal property for 
    wholesale or
retail sale or lease, whether such sale or 
    lease is made directly by the
manufacturer or by some other 
    person, whether the materials used in the process
are owned 
    by the manufacturer or some other person, or whether such 
    sale or
lease is made apart from or as an incident to the 
    seller's engaging in a
service occupation and the 
    applicable tax is a Service Use Tax or Service
Occupation 
    Tax, rather than Use Tax or Retailers' Occupation Tax. The 
    exemption provided by this paragraph (5) includes 
    production related tangible personal property, as defined 
    in Section 3-50 of the Use Tax Act, purchased on or after 
    July 1, 2019. The exemption provided by this paragraph (5) 
    does not include machinery and equipment used in (i) the 
    generation of electricity for wholesale or retail sale; 
    (ii) the generation or treatment of natural or artificial 
    gas for wholesale or retail sale that is delivered to 
    customers through pipes, pipelines, or mains; or (iii)  the 
    treatment of water for wholesale or retail sale that is 
    delivered to customers through pipes, pipelines, or mains.    
    The provisions of Public Act 98-583 are declaratory of 
    existing law as to the meaning and scope of this exemption. 
    The exemption under this paragraph (5) is exempt from the 
    provisions of Section 3-75. 

        (5a) the repairing, reconditioning or remodeling, for 
    a
common carrier by rail, of tangible personal property 
    which belongs to such
carrier for hire, and as to which 
    such carrier receives the physical possession
of the 
    repaired, reconditioned or remodeled item of tangible 
    personal property
in Illinois, and which such carrier 
    transports, or shares with another common
carrier in the 
    transportation of such property, out of Illinois on a 
    standard
uniform bill of lading showing the person who 
    repaired, reconditioned or
remodeled the property to a 
    destination outside Illinois, for use outside
Illinois.

        (5b) a sale or transfer of tangible personal property 
    which is produced by
the seller thereof on special order in 
    such a way as to have made the
applicable tax the Service 
    Occupation Tax or the Service Use Tax, rather than
the 
    Retailers' Occupation Tax or the Use Tax, for an interstate 
    carrier by rail
which receives the physical possession of 
    such property in Illinois, and which
transports such 
    property, or shares with another common carrier in the

    transportation of such property, out of Illinois on a 
    standard uniform bill of
lading showing the seller of the 
    property as the shipper or consignor of such
property to a 
    destination outside Illinois, for use outside Illinois.

        (6) until July 1, 2003, a sale or transfer of 
    distillation machinery
and equipment, sold
as a unit or kit 
    and assembled or installed by the retailer, which
machinery 
    and equipment is certified by the user to be used only for 
    the
production of ethyl alcohol that will be used for 
    consumption as motor fuel
or as a component of motor fuel 
    for the personal use of such user and not
subject to sale 
    or resale.

        (7) at the election of any serviceman not required to 
    be
otherwise registered as a retailer under Section 2a of 
    the Retailers'
Occupation Tax Act, made for each fiscal 
    year sales
of service in which the aggregate annual cost 
    price of tangible
personal property transferred as an 
    incident to the sales of service is
less than 35%, or 75% 
    in the case of servicemen transferring prescription
drugs 
    or servicemen engaged in graphic arts production, of the 
    aggregate
annual total gross receipts from all sales of 
    service. The purchase of
such tangible personal property by 
    the serviceman shall be subject to tax
under the Retailers' 
    Occupation Tax Act and the Use Tax Act.
However, if a

    primary serviceman who has made the election described in 
    this paragraph
subcontracts service work to a secondary 
    serviceman who has also made the
election described in this 
    paragraph, the primary serviceman does not
incur a Use Tax 
    liability if the secondary serviceman (i) has paid or will 
    pay
Use
Tax on his or her cost price of any tangible 
    personal property transferred
to the primary serviceman 
    and (ii) certifies that fact in writing to the
primary

    serviceman.

    Tangible personal property transferred incident to the 
completion of a
maintenance agreement is exempt from the tax 
imposed pursuant to this Act.

    Exemption (5) also includes machinery and equipment used in 
the general
maintenance or repair of such exempt machinery and 
equipment or for in-house
manufacture of exempt machinery and 
equipment. On and after July 1, 2017, exemption (5) also

includes graphic arts machinery and equipment, as
defined in 
paragraph (5) of Section 3-5. The machinery and equipment 
exemption does not include machinery and equipment used in (i) 
the generation of electricity for wholesale or retail sale; 
(ii) the generation or treatment of natural or artificial gas 
for wholesale or retail sale that is delivered to customers 
through pipes, pipelines, or mains; or (iii) the treatment of 
water for wholesale or retail sale that is delivered to 
customers through pipes, pipelines, or mains.   The provisions of 
Public Act 98-583 are declaratory of existing law as to the 
meaning and scope of this exemption. For the purposes of 
exemption
(5), each of these terms shall have the following 
meanings:  (1) "manufacturing
process" shall mean the 
production of any article of tangible personal
property, 
whether such article is a finished product or an article for 
use in
the process of manufacturing or assembling a different 
article of tangible
personal property, by procedures commonly 
regarded as manufacturing,
processing, fabricating, or 
refining which changes some existing
material or materials into 
a material with a different form, use or
name.  In relation to a 
recognized integrated business composed of a
series of 
operations which collectively constitute manufacturing, or

individually constitute manufacturing operations, the 
manufacturing
process shall be deemed to commence with the 
first operation or stage of
production in the series, and shall 
not be deemed to end until the
completion of the final product 
in the last operation or stage of
production in the series; and 
further, for purposes of exemption (5),
photoprocessing is 
deemed to be a manufacturing process of tangible
personal 
property for wholesale or retail sale; (2) "assembling process" 
shall
mean the production of any article of tangible personal 
property, whether such
article is a finished product or an 
article for use in the process of
manufacturing or assembling a 
different article of tangible personal
property, by the 
combination of existing materials in a manner commonly
regarded 
as assembling which results in a material of a different form,

use or name; (3) "machinery" shall mean major mechanical 
machines or
major components of such machines contributing to a 
manufacturing or
assembling process; and (4) "equipment" shall 
include any independent
device or tool separate from any 
machinery but essential to an
integrated manufacturing or 
assembly process; including computers
used primarily in a 
manufacturer's computer
assisted design, computer assisted 
manufacturing (CAD/CAM) system;
or any subunit or assembly 
comprising a component of any machinery or
auxiliary, adjunct 
or attachment parts of machinery, such as tools, dies,
jigs, 
fixtures, patterns and molds; or any parts which require 
periodic
replacement in the course of normal operation; but 
shall not include hand
tools.
Equipment includes chemicals or 
chemicals acting as catalysts but only if the
chemicals or 
chemicals acting as catalysts effect a direct and immediate 
change
upon a
product being manufactured or assembled for 
wholesale or retail sale or
lease.
The purchaser of such 
machinery and equipment who has an active
resale registration 
number shall furnish such number to the seller at the
time of 
purchase. The user of such machinery and equipment and tools

without an active resale registration number shall prepare a 
certificate of
exemption for each transaction stating facts 
establishing the exemption for
that transaction, which 
certificate shall be available to the Department
for inspection 
or audit.  The Department shall prescribe the form of the

certificate.

    Any informal rulings, opinions or letters issued by the 
Department in
response to an inquiry or request for any opinion 
from any person
regarding the coverage and applicability of 
exemption (5) to specific
devices shall be published, 
maintained as a public record, and made
available for public 
inspection and copying.  If the informal ruling,
opinion or 
letter contains trade secrets or other confidential

information, where possible the Department shall delete such 
information
prior to publication.  Whenever such informal 
rulings, opinions, or
letters contain any policy of general 
applicability, the Department
shall formulate and adopt such 
policy as a rule in accordance with the
provisions of the 
Illinois Administrative Procedure Act.

    On and after July 1, 1987, no entity otherwise eligible 
under exemption
(3) of this Section shall make tax-free 
purchases unless it has an active
exemption identification 
number issued by the Department.

    The purchase, employment and transfer of such tangible 
personal
property as newsprint and ink for the primary purpose 
of conveying news
(with or without other information) is not a 
purchase, use or sale of
service or of tangible personal 
property within the meaning of this Act.

    "Serviceman" means any person who is engaged in the 
occupation of
making sales of service.

    "Sale at retail" means "sale at retail" as defined in the 
Retailers'
Occupation Tax Act.

    "Supplier" means any person who makes sales of tangible 
personal
property to servicemen for the purpose of resale as an 
incident to a
sale of service.

    "Serviceman maintaining a place of business in this State", 
or any
like term, means and includes any serviceman:

        (1) having or maintaining within this State, directly 
    or by a
subsidiary, an office, distribution house, sales 
    house, warehouse or
other place of business, or any agent 
    or other representative operating
within this State under 
    the authority of the serviceman or its
subsidiary, 
    irrespective of whether such place of business or agent or

    other representative is located here permanently or 
    temporarily, or
whether such serviceman or subsidiary is 
    licensed to do business in this
State;
        (1.1) having a contract with a person located in this 
    State under which the person, for a commission or other 
    consideration based on the sale of service by the 
    serviceman, directly or indirectly refers potential 
    customers to the serviceman by providing to the potential 
    customers a promotional code or other mechanism that allows 
    the serviceman to track purchases referred by such persons. 
    Examples of mechanisms that allow the serviceman to track 
    purchases referred by such persons include but are not 
    limited to the use of a link on the person's Internet 
    website, promotional codes distributed through the 
    person's hand-delivered or mailed material, and 
    promotional codes distributed by the person through radio 
    or other broadcast media. The provisions of this paragraph 
    (1.1) shall apply only if the cumulative gross receipts 
    from sales of service by the serviceman to customers who 
    are referred to the serviceman by all persons in this State 
    under such contracts exceed $10,000 during the preceding 4 
    quarterly periods ending on the last day of March, June, 
    September, and December; a serviceman meeting the 
    requirements of this paragraph (1.1) shall be presumed to 
    be maintaining a place of business in this State but may 
    rebut this presumption by submitting proof that the 
    referrals or other activities pursued within this State by 
    such persons were not sufficient to meet the nexus 
    standards of the United States Constitution during the 
    preceding 4 quarterly periods; 
        (1.2) beginning July 1, 2011, having a contract with a 
    person located in this State under which:
            (A) the serviceman sells the same or substantially 
        similar line of services as the person located in this 
        State and does so using an identical or substantially 
        similar name, trade name, or trademark as the person 
        located in this State; and
            (B) the serviceman provides a commission or other 
        consideration to the person located in this State based 
        upon the sale of services by the serviceman.
    The provisions of this paragraph (1.2) shall apply only if 
    the cumulative gross receipts from sales of service by the 
    serviceman to customers in this State under all such 
    contracts exceed $10,000 during the preceding 4 quarterly 
    periods ending on the last day of March, June, September, 
    and December; 

        (2) soliciting orders for tangible personal property 
    by means of a
telecommunication or television shopping 
    system (which utilizes toll free
numbers) which is intended 
    by the retailer to be broadcast by cable
television or 
    other means of broadcasting, to consumers located in this 
    State;

        (3) pursuant to a contract with a broadcaster or 
    publisher located in this
State, soliciting orders for 
    tangible personal property by means of advertising
which is 
    disseminated primarily to consumers located in this State 
    and only
secondarily to bordering jurisdictions;

        (4) soliciting orders for tangible personal property 
    by mail if the
solicitations are substantial and recurring 
    and if the retailer benefits
from any banking, financing, 
    debt collection, telecommunication, or
marketing 
    activities occurring in this State or benefits from the 
    location
in this State of authorized installation, 
    servicing, or repair facilities;

        (5) being owned or controlled by the same interests 
    which own or
control any retailer engaging in business in 
    the same or similar line of
business in this State;

        (6) having a franchisee or licensee operating under its 
    trade name if
the franchisee or licensee is required to 
    collect the tax under this Section;

        (7) pursuant to a contract with a cable television 
    operator located in
this State, soliciting orders for 
    tangible personal property by means of
advertising which is 
    transmitted or distributed over a cable television
system 
    in this State;

        (8) engaging in activities in Illinois, which 
    activities in the
state in which the supply business 
    engaging in such activities is located
would constitute 
    maintaining a place of business in that state; or

        (9) beginning October 1, 2018, making sales of service 
    to purchasers in Illinois from outside of Illinois if: 
            (A) the cumulative gross receipts from sales of 
        service to purchasers in Illinois are $100,000 or more; 
        or 
            (B) the serviceman enters into 200 or more separate 
        transactions for sales of service to purchasers in 
        Illinois. 
        The serviceman shall determine on a quarterly basis, 
    ending on the last day of March, June, September, and 
    December, whether he or she meets the criteria of either 
    subparagraph (A) or (B) of this paragraph (9) for the 
    preceding 12-month period.  If the serviceman meets the 
    criteria of either subparagraph (A) or (B) for a 12-month 
    period, he or she is considered a serviceman maintaining a 
    place of business in this State and is required to collect 
    and remit the tax imposed under this Act and file returns 
    for one year.  At the end of that one-year period, the 
    serviceman shall determine whether the serviceman met the 
    criteria of either subparagraph (A) or (B) during the 
    preceding 12-month period.  If the serviceman met the 
    criteria in either subparagraph (A) or (B) for the 
    preceding 12-month period, he or she is considered a 
    serviceman maintaining a place of business in this State 
    and is required to collect and remit the tax imposed under 
    this Act and file returns for the subsequent year.  If at 
    the end of a one-year period a serviceman that was required 
    to collect and remit the tax imposed under this Act 
    determines that he or she did not meet the criteria in 
    either subparagraph (A) or (B) during the preceding 
    12-month period, the serviceman subsequently shall 
    determine on a quarterly basis, ending on the last day of 
    March, June, September, and December, whether he or she 
    meets the criteria of either subparagraph (A) or (B) for 
    the preceding 12-month period. 
(Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 
100-587, eff. 6-4-18; 100-863, eff. 8-14-18.)

 
    Section 25-15. The Service Occupation Tax Act is amended  by 
changing Section 2 as follows:
 



    (35 ILCS 115/2)  (from Ch. 120, par. 439.102)



    Sec. 2. In this Act: 
    "Transfer" means any transfer of the title to property or 
of
the ownership of property whether or not the transferor 
retains title as
security for the payment of amounts due him 
from the transferee.

    "Cost Price" means the consideration paid by the serviceman 
for a
purchase valued in money, whether paid in money or 
otherwise, including
cash, credits and services, and shall be 
determined without any deduction
on account of the supplier's 
cost of the property sold or on account of any
other expense 
incurred by the supplier. When a serviceman contracts out
part 
or all of the services required in his sale of service, it 
shall be
presumed that the cost price to the serviceman of the 
property
transferred to him by his or her subcontractor is 
equal to 50% of the
subcontractor's charges to the serviceman 
in the absence of proof of the
consideration paid by the 
subcontractor for the purchase of such
property.

    "Department" means the Department of Revenue.

    "Person" means any natural individual, firm, partnership, 
association, joint
stock company, joint venture, public or 
private corporation, limited liability
company, and any 
receiver, executor, trustee, guardian or other representative

appointed by order of any court.

    "Sale of Service" means any transaction except:

    (a) A retail sale of tangible personal property taxable 
under the Retailers'
Occupation Tax Act or under the Use Tax 
Act.

    (b) A sale of tangible personal property for the purpose of 
resale made in
compliance with Section 2c of the Retailers' 
Occupation Tax Act.

    (c) Except as hereinafter provided, a sale or transfer of 
tangible personal
property as an incident to the rendering of 
service for or by any governmental
body or for or by any 
corporation, society, association, foundation or
institution 
organized and operated exclusively for charitable, religious 
or
educational purposes or any not-for-profit corporation, 
society, association,
foundation, institution or organization 
which has no compensated officers or
employees and which is 
organized and operated primarily for the recreation of
persons 
55 years of age or older. A limited liability company may 
qualify for
the exemption under this paragraph only if the 
limited liability company is
organized and operated 
exclusively for educational purposes.

    (d) (Blank).

    (d-1) A sale or transfer of tangible personal
property as 
an incident to
the rendering of service for owners, lessors or 
shippers of tangible personal
property which is utilized by 
interstate carriers for hire for use as rolling
stock moving in 
interstate commerce, and equipment operated
by a 
telecommunications provider, licensed as a common carrier by 
the
Federal Communications Commission, which is permanently 
installed in or
affixed to aircraft moving in interstate 
commerce.

    (d-1.1) On and after July 1, 2003 and through June 30, 
2004, a sale or transfer of a motor vehicle
of the
second 
division with a gross vehicle weight in excess of 8,000 pounds 
as an
incident to the rendering of service if that motor

vehicle is subject
to the commercial distribution fee imposed 
under Section 3-815.1 of the
Illinois Vehicle
Code. Beginning 
on July 1, 2004 and through June 30, 2005, the use in this 
State of motor vehicles of the second division: (i) with a 
gross vehicle weight rating in excess of 8,000 pounds; (ii) 
that are subject to the commercial distribution fee imposed 
under Section 3-815.1 of the Illinois Vehicle Code; and (iii) 
that are primarily used for commercial purposes. Through June 
30, 2005, this exemption applies to repair and replacement 
parts added after the
initial
purchase of such a motor vehicle 
if that motor vehicle is used in a manner that
would
qualify 
for the rolling stock exemption otherwise provided for in this 
Act. For purposes of this paragraph, "used for commercial 
purposes" means the transportation of persons or property in 
furtherance of any commercial or industrial enterprise whether 
for-hire or not.


    (d-2) The repairing, reconditioning or remodeling, for a 
common carrier by
rail, of tangible personal property which 
belongs to such carrier for hire, and
as to which such carrier 
receives the physical possession of the repaired,

reconditioned or remodeled item of tangible personal property 
in Illinois, and
which such carrier transports, or shares with 
another common carrier in the
transportation of such property, 
out of Illinois on a standard uniform bill of
lading showing 
the person who repaired, reconditioned or remodeled the 
property
as the shipper or consignor of such property to a 
destination outside Illinois,
for use outside Illinois.

    (d-3) A sale or transfer of tangible personal property 
which
is produced by the seller thereof on special order in 
such a way as to have
made the applicable tax the Service 
Occupation Tax or the Service Use Tax,
rather than the 
Retailers' Occupation Tax or the Use Tax, for an interstate

carrier by rail which receives the physical possession of such 
property in
Illinois, and which transports such property, or 
shares with another common
carrier in the transportation of 
such property, out of Illinois on a standard
uniform bill of 
lading showing the seller of the property as the shipper or

consignor of such property to a destination outside Illinois, 
for use outside
Illinois.

    (d-4) Until January 1, 1997, a sale, by a registered 
serviceman paying tax
under this Act to the Department, of 
special order printed materials delivered
outside Illinois and 
which are not returned to this State, if delivery is made
by 
the seller or agent of the seller, including an agent who 
causes the product
to be delivered outside Illinois by a common 
carrier or the U.S.
postal service.

    (e) A sale or transfer of machinery and equipment used 
primarily in
the process of the manufacturing or assembling, 
either in an existing, an
expanded or a new manufacturing 
facility, of tangible personal property for
wholesale or retail 
sale or lease, whether such sale or lease is made directly
by 
the manufacturer or by some other person, whether the materials 
used in the
process are owned by the manufacturer or some other 
person, or whether such
sale or lease is made apart from or as 
an incident to the seller's engaging in
a service occupation 
and the applicable tax is a Service Occupation Tax or
Service 
Use Tax, rather than Retailers' Occupation Tax or Use Tax. The 
exemption provided by this paragraph (e) includes production 
related tangible personal property, as defined in Section 3-50 
of the Use Tax Act, purchased on or after July 1, 2019. The 
exemption provided by this paragraph (e) does not include 
machinery and equipment used in (i) the generation of 
electricity for wholesale or retail sale; (ii) the generation 
or treatment of natural or artificial gas for wholesale or 
retail sale that is delivered to customers through pipes, 
pipelines, or mains; or (iii) the treatment of water for 
wholesale or retail sale that is delivered to customers through 
pipes, pipelines, or mains.   The provisions of Public Act 98-583 
are declaratory of existing law as to the meaning and scope of 
this exemption. The exemption under this subsection (e) is 
exempt from the provisions of Section 3-75. 

    (f) Until July 1, 2003, the sale or transfer of 
distillation
machinery
and equipment, sold as a
unit or kit and 
assembled or installed by the retailer, which machinery
and 
equipment is certified by the user to be used only for the 
production
of ethyl alcohol that will be used for consumption 
as motor fuel or as a
component of motor fuel for the personal 
use of such user and not subject
to sale or resale.

    (g) At the election of any serviceman not required to be 
otherwise
registered as a retailer under Section 2a of the 
Retailers' Occupation Tax Act,
made for each fiscal year sales 
of service in which the aggregate annual cost
price of tangible 
personal property transferred as an incident to the sales of

service is less than 35% (75% in the case of servicemen 
transferring
prescription drugs or servicemen engaged in 
graphic arts production) of the
aggregate annual total gross 
receipts from all sales of service. The purchase
of such 
tangible personal property by the serviceman shall be subject 
to tax
under the Retailers' Occupation Tax Act and the Use Tax 
Act.
However, if a
primary serviceman who has made the election 
described in this paragraph
subcontracts service work to a 
secondary serviceman who has also made the
election described 
in this paragraph, the primary serviceman does not
incur a Use 
Tax liability if the secondary serviceman (i) has paid or will 
pay
Use
Tax on his or her cost price of any tangible personal 
property transferred
to the primary serviceman and (ii) 
certifies that fact in writing to the
primary serviceman.

    Tangible personal property transferred incident to the 
completion of a
maintenance agreement is exempt from the tax 
imposed pursuant to this Act.

    Exemption (e) also includes machinery and equipment used in 
the
general maintenance or repair of such exempt machinery and 
equipment or for
in-house manufacture of exempt machinery and 
equipment.
On and after July 1, 2017, exemption (e) also

includes graphic arts machinery and equipment, as
defined in 
paragraph (5) of Section 3-5. The machinery and equipment 
exemption does not include machinery and equipment used in (i) 
the generation of electricity for wholesale or retail sale; 
(ii) the generation or treatment of natural or artificial gas 
for wholesale or retail sale that is delivered to customers 
through pipes, pipelines, or mains; or (iii) the treatment of 
water for wholesale or retail sale that is delivered to 
customers through pipes, pipelines, or mains.     The provisions of 
Public Act 98-583 are declaratory of existing law as to the 
meaning and scope of this exemption. For the purposes of 
exemption (e), each of these terms shall have the following

meanings:  (1) "manufacturing process" shall mean the 
production of any
article of tangible personal property, 
whether such article is a
finished product or an article for 
use in the process of manufacturing
or assembling a different 
article of tangible personal property, by
procedures commonly 
regarded as manufacturing, processing, fabricating,
or 
refining which changes some existing material or materials into 
a
material with a different form, use or name.  In relation to a

recognized integrated business composed of a series of 
operations which
collectively constitute manufacturing, or 
individually constitute
manufacturing operations, the 
manufacturing process shall be deemed to
commence with the 
first operation or stage of production in the series,
and shall 
not be deemed to end until the completion of the final product

in the last operation or stage of production in the series; and 
further for
purposes of exemption (e), photoprocessing is 
deemed to be a manufacturing
process of tangible personal 
property for wholesale or retail sale;
(2) "assembling process" 
shall mean the production of any article of
tangible personal 
property, whether such article is a finished product
or an 
article for use in the process of manufacturing or assembling a

different article of tangible personal property, by the 
combination of
existing materials in a manner commonly regarded 
as assembling which
results in a material of a different form, 
use or name; (3) "machinery"
shall mean major mechanical 
machines or major components of such machines
contributing to a 
manufacturing or assembling process; and (4) "equipment"
shall 
include any independent device or tool separate from any 
machinery but
essential to an integrated manufacturing or 
assembly process; including
computers used primarily in a 
manufacturer's computer
assisted design, computer assisted 
manufacturing (CAD/CAM) system; or any
subunit or assembly 
comprising a component of any machinery or auxiliary,
adjunct 
or attachment parts of machinery, such as tools, dies, jigs, 
fixtures,
patterns and molds; or any parts which require 
periodic replacement in the
course of normal operation; but 
shall not include hand tools.  Equipment
includes chemicals or 
chemicals acting as catalysts but only if the chemicals
or 
chemicals acting as catalysts effect a direct and immediate 
change upon a
product being manufactured or assembled for 
wholesale or retail sale or lease.
The purchaser of such 
machinery and equipment
who has an active resale registration 
number shall furnish such number to
the seller at the time of 
purchase.  The purchaser of such machinery and
equipment and 
tools without an active resale registration number shall 
furnish
to the seller a certificate of exemption for each 
transaction stating facts
establishing the exemption for that 
transaction, which certificate shall
be available to the 
Department for inspection or audit.

    Except as provided in Section 2d of this Act, the rolling 
stock exemption
applies to rolling
stock
used by an interstate

carrier for hire, even just between points in Illinois, if such 
rolling
stock transports, for hire, persons whose journeys or 
property whose
shipments originate or terminate outside 
Illinois.

    Any informal rulings, opinions or letters issued by the 
Department in
response to an inquiry or request for any opinion 
from any person
regarding the coverage and applicability of 
exemption (e) to specific
devices shall be published, 
maintained as a public record, and made
available for public 
inspection and copying.  If the informal ruling,
opinion or 
letter contains trade secrets or other confidential

information, where possible the Department shall delete such 
information
prior to publication.  Whenever such informal 
rulings, opinions, or
letters contain any policy of general 
applicability, the Department
shall formulate and adopt such 
policy as a rule in accordance with the
provisions of the 
Illinois Administrative Procedure Act.

    On and after July 1, 1987, no entity otherwise eligible 
under exemption
(c) of this Section shall make tax-free 
purchases unless it has an active
exemption identification 
number issued by the Department.

    "Serviceman" means any person who is engaged in the 
occupation of
making sales of service.

    "Sale at Retail" means "sale at retail" as defined in the 
Retailers'
Occupation Tax Act.

    "Supplier" means any person who makes sales of tangible 
personal
property to servicemen for the purpose of resale as an 
incident to a
sale of service.

(Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 
100-863, eff. 8-14-18.)

 
    Section 25-20. The Retailers' Occupation Tax Act is amended  
by changing Section 2-45 as follows:
 



    (35 ILCS 120/2-45)  (from Ch. 120, par. 441-45)


    Sec. 2-45. Manufacturing and assembly exemption. The 
manufacturing
and assembly machinery and equipment exemption 
includes machinery
and equipment that replaces machinery
and 
equipment in an existing manufacturing facility as well as 
machinery
and equipment that are for use in an expanded or new

manufacturing facility.

    The machinery and equipment exemption also includes 
machinery
and equipment used in the
general maintenance or 
repair of exempt machinery and equipment or for
in-house 
manufacture of exempt machinery and equipment.
Beginning on 
July 1, 2017, the manufacturing and assembling machinery and 
equipment exemption also includes graphic arts machinery and 
equipment, as defined in paragraph (4) of Section 2-5. The 
machinery and equipment exemption does not include machinery 
and equipment used in (i) the generation of electricity for 
wholesale or retail sale; (ii) the generation or treatment of 
natural or artificial gas for wholesale or retail sale that is 
delivered to customers through pipes, pipelines, or mains; or 
(iii) the treatment of water for wholesale or retail sale that 
is delivered to customers through pipes, pipelines, or mains.    
The provisions of this amendatory Act of the 98th General 
Assembly are declaratory of existing law as to the meaning and 
scope of this exemption. For the purposes of this exemption, 
terms have the following meanings:

        (1) "Manufacturing process" means the production of an 
    article of
tangible personal property, whether the article 
    is a finished product or an
article for use in the process 
    of manufacturing or assembling a different
article of 
    tangible personal property, by a procedure commonly 
    regarded as
manufacturing, processing, fabricating, or 
    refining that changes some
existing material or materials 
    into a material with a different form, use,
or name.  In 
    relation to a recognized integrated business composed of a

    series of operations that collectively constitute 
    manufacturing, or
individually constitute manufacturing 
    operations, the manufacturing process
commences with the 
    first operation or stage of production in the series and

    does not end until the completion of the final product in 
    the last
operation or stage of production in the series.  
    For purposes of this
exemption, photoprocessing is a 
    manufacturing process of tangible personal
property for 
    wholesale or retail sale.

        (2) "Assembling process" means the production of an 
    article of
tangible personal property, whether the article 
    is a finished product or an
article for use in the process 
    of manufacturing or assembling a different
article of 
    tangible personal property, by the combination of existing

    materials in a manner commonly regarded as assembling that 
    results in a
material of a different form, use, or name.

        (3) "Machinery" means major mechanical machines or 
    major components of
those machines contributing to a 
    manufacturing or assembling process.

        (4) "Equipment" includes an independent device or tool 
    separate from
machinery but essential to an integrated 
    manufacturing or assembly process;
including computers 
    used primarily in a manufacturer's computer assisted 
    design, computer assisted manufacturing
(CAD/CAM) system; 
    any subunit or assembly comprising a component of any

    machinery or auxiliary, adjunct, or attachment parts of 
    machinery, such as
tools, dies, jigs, fixtures, patterns, 
    and molds; and any parts that
require periodic replacement 
    in the course of normal operation; but does
not include 
    hand tools. Equipment includes chemicals or chemicals 
    acting as
catalysts but only if
the chemicals or chemicals 
    acting as catalysts effect a direct and
immediate change 
    upon a
product being manufactured or assembled for 
    wholesale or retail sale or
lease.

        (5) "Production related tangible personal property" 
    means all tangible personal property that is used or 
    consumed by the purchaser in a manufacturing facility in 
    which a manufacturing process takes place and includes, 
    without limitation,  tangible personal property that is 
    purchased for incorporation into real estate within a 
    manufacturing facility, supplies and consumables used in a 
    manufacturing facility including fuels, coolants, 
    solvents, oils, lubricants, and adhesives, hand tools, 
    protective apparel, and fire and safety equipment used or 
    consumed within a manufacturing facility, and tangible 
    personal property that is used or consumed in activities 
    such as research and development, preproduction material 
    handling, receiving, quality control, inventory control, 
    storage, staging, and packaging for shipping and 
    transportation purposes. "Production related tangible 
    personal property" does not include (i) tangible personal 
    property that is used, within or without a manufacturing 
    facility, in sales, purchasing, accounting, fiscal 
    management, marketing, personnel recruitment or selection, 
    or landscaping or (ii) tangible personal property that is 
    required to be titled or registered with a department, 
    agency, or unit of federal, State, or local government. 

    The manufacturing and assembling machinery and equipment 
exemption includes production related tangible personal 
property that is purchased on or after July 1, 2007 and on or 
before June 30, 2008 and on or after July 1, 2019. The 
exemption for production related tangible personal property 
purchased on or after July 1, 2007 and before June 30, 2008 is 
subject to both of  the following limitations:
        (1) The maximum amount of the exemption for any one 
    taxpayer may not exceed 5% of the purchase price of 
    production related tangible personal property that is 
    purchased on or after July 1, 2007 and on or before June 
    30, 2008. A credit under Section 3-85 of this Act may not 
    be earned by the purchase of production related tangible 
    personal property for which an exemption is received under 
    this Section.
        (2) The maximum aggregate amount of  the exemptions for 
    production related tangible personal property  awarded 
    under this Act and the Use
 Tax Act to all taxpayers may not 
    exceed $10,000,000. If the claims for the exemption exceed 
    $10,000,000, then the Department shall reduce the amount of 
    the exemption to each taxpayer on a pro rata basis.
The Department shall may adopt rules to implement and 
administer the exemption for production related tangible 
personal property. 
    The manufacturing and assembling machinery and equipment 
exemption
includes the sale of materials to a purchaser who 
produces exempted types
of machinery, equipment, or tools and 
who rents or leases that machinery,
equipment, or tools to a 
manufacturer of tangible personal property.  This
exemption 
also includes the sale of materials to a purchaser who 
manufactures
those materials into an exempted type of 
machinery, equipment, or tools
that the purchaser uses himself 
or herself in the manufacturing of tangible
personal property.  
The purchaser of the machinery and equipment who has an
active 
resale registration number shall furnish that number to the 
seller
at the time of purchase.  A purchaser of the machinery, 
equipment, and
tools without an active resale registration 
number shall furnish to the
seller a certificate of exemption 
for each transaction stating facts
establishing the exemption 
for that transaction, and that certificate shall
be available 
to the Department for inspection or audit.  Informal
rulings, 
opinions, or letters issued by the Department in response to an

inquiry or request for an opinion from any person regarding the 
coverage and
applicability of this exemption to specific 
devices shall be published,
maintained as a public record,
and 
made available for public inspection and copying.  If the 
informal
ruling, opinion, or letter contains trade secrets or 
other confidential
information, where possible, the Department 
shall delete that information
before publication.  Whenever 
informal rulings, opinions, or letters
contain a policy of 
general applicability, the Department shall
formulate and 
adopt that policy as a rule in accordance with the Illinois

Administrative Procedure Act.

    The manufacturing and assembling machinery and equipment

exemption is exempt from the provisions of Section 2-70. 
(Source: P.A. 100-22, eff. 7-6-17.)

 
ARTICLE 30. BUSINESS CORPORATION ACT OF 1983

 
    Section 30-5. The Business Corporation Act of 1983 is 
amended  by changing Sections 14.30, 15.35, 15.65, and 15.97 as 
follows:
 



    (805 ILCS 5/14.30)  (from Ch. 32, par. 14.30)



    Sec. 14.30. 
Cumulative report of changes in issued shares 
or paid-in
capital.

    (a) Each domestic corporation and each foreign corporation

authorized to transact business in this State that effects any 
change in
the number of issued shares or the amount of paid-in 
capital prior to January 1, 2024 that has
not theretofore been 
reported in any report other than an annual report,
interim 
annual report, or final transition annual report, shall execute 
and
file, in accordance with Section 1.10 of this Act, a report 
with respect to
the changes in its issued shares or paid-in 
capital:


        (1) that have occurred subsequent to the last day of 
    the third month
preceding its anniversary month in the 
    preceding year and prior to the
first day of the second 
    month immediately preceding its anniversary month
in the 
    current year; or


        (2) in the case of a corporation that has established 
    an extended
filing month, that have occurred during its 
    fiscal year; or


        (3) in the case of a statutory merger or consolidation 
    or an amendment
to the corporation's articles of 
    incorporation that affects the number of
issued shares or 
    the amount of paid-in capital,
that have
occurred between 
    the last day of the third month immediately preceding its

    anniversary month and the date of the merger, 
    consolidation, or
amendment  or, in the
case of a 
    corporation that has established an extended filing month, 
    that
have occurred between the first day of its fiscal year 
    and the date of the
merger, consolidation, or amendment; or


        (4) in the case of a statutory merger or consolidation 
    or an amendment
to the corporation's articles of 
    incorporation that affects the number of
issued shares or 
    the amount of paid-in capital,
that have
occurred between 
    the date of the merger, consolidation, or amendment (but

    not including the merger,
consolidation, or amendment) and 
    the first day of the second month
immediately preceding
its 
    anniversary month in the current year, or in the case of a 
    corporation
that has established an extended filing month, 
    that have occurred between
the date of the merger, 
    consolidation or amendment (but not including the
merger, 
    consolidation or amendment) and the last day of
its fiscal 
    year.

    (b) The corporation shall file the report required under 
subsection
(a) not later than (i) the time its annual report is 
required to be filed in
1992 and in each subsequent year and 
(ii) not later than the time of filing
the articles of merger, 
consolidation, or amendment to the articles of
incorporation 
that affects the number of issued shares or the amount of 
paid-in
capital of a domestic corporation or the certified copy 
of
merger
of a foreign corporation.

    (c) The report shall net decreases against increases that 
occur during
the same taxable period.  The report shall set 
forth:


        (1) The name of the corporation and the state or 
    country under the laws
of which it is organized.


        (2) A statement of the aggregate number of shares which 
    the corporation
has authority to issue, itemized by classes 
    and series, if any, within a class.


        (3) A statement of the aggregate number of issued 
    shares as last
reported to the Secretary of State in any 
    document required or permitted by
this Act to be filed, 
    other than an annual report, interim annual report or
final 
    transition annual report, itemized by classes and series, 
    if any,
within a class.


        (4) A statement, expressed in dollars, of the amount of 
    paid-in capital
of the corporation as last reported to the 
    Secretary of State in any
document required or permitted by 
    this Act to be filed, other than an
annual report, interim 
    annual report or final transition annual report.


        (5) A statement, if applicable, of the aggregate number 
    of shares
issued by the corporation not theretofore 
    reported to the Secretary of
State as having been issued, 
    and a statement, expressed in dollars, of the
value of the 
    entire consideration received, less expenses, including

    commissions, paid or incurred in connection with the 
    issuance, for, or on
account of, the issuance of the 
    shares, itemized by
classes, and series, if any, within a 
    class; and in the case of shares
issued as a share 
    dividend, the amount added or transferred to the paid-in

    capital of the corporation for, or on account of, the 
    issuance of the
shares; provided, however, that the report 
    shall also include the date of
each issuance made prior to 
    the current reporting period, and the number of
issued 
    shares and consideration received in each case.


        (6) A statement, if applicable, expressed in dollars, 
    of the amount
added or transferred to paid-in capital of 
    the corporation without the
issuance of shares; provided, 
    however, that the report shall also include
the date of 
    each increase made prior to the current reporting period, 
    and
the consideration received in each case.


        (7) In case of an exchange or reclassification of 
    issued shares
resulting in an increase in the amount of 
    paid-in capital, a statement of
the manner in which it was 
    effected, and a statement, expressed in dollars, of
the 
    amount added or transferred to the paid-in capital of the 
    corporation
as a result thereof, except any portion thereof 
    reported under any other
subsection of this Section as a 
    part of the consideration received by the
corporation for, 
    or on account of, its issued shares; provided, however,

    that the report shall also include the date of each 
    exchange or
reclassification made prior to the current 
    reporting period and the
consideration received in each 
    case.


        (8) If the consideration received for the issuance of 
    any shares not
theretofore reported as having been issued 
    consists of labor or services
performed or of property, 
    other than cash, then a statement, expressed in
dollars, of 
    the value of that consideration as fixed by the board of

    directors.


        (9) In the case of a cancellation of shares or a 
    reduction in paid-in
capital made pursuant to Section 9.20, 
    the aggregate
reduction in paid-in capital;
provided, 
    however, that the report shall also include the date of 
    each
reduction made prior to the current reporting period.


        (10) A statement of the aggregate number of issued 
    shares itemized by
classes and series, if any, within a 
    class, after giving effect to the
changes reported.


        (11) A statement, expressed in dollars, of the amount 
    of paid-in capital
of the corporation after giving effect 
    to the changes reported.

    (d) No additional license fees or franchise taxes shall be 
payable
upon the filing of the report to the extent that 
license fees or franchise
taxes shall have been previously paid 
by the corporation in respect of
shares previously issued which 
are being exchanged for the shares the
issuance of which is 
being reported, provided those facts are shown in
the report.

    (e) The report shall be made on forms prescribed and 
furnished by the
Secretary of State.

    (f) Until the report under this Section or a report under 
Section 14.25
shall have been filed in the Office of the 
Secretary of State showing a
reduction in paid-in capital, the 
basis of the annual franchise tax payable
by the corporation 
shall not be reduced, provided, however, in no event
shall the 
annual franchise tax for any taxable year be reduced if the

report is not filed prior to the first day of the anniversary 
month or, in
the case of a corporation which has established an 
extended filing month,
the extended filing month of the 
corporation of that taxable year and
before payment of its 
annual franchise tax.

(Source: P.A. 90-421, eff. 1-1-98.)

 



    (805 ILCS 5/15.35)  (from Ch. 32, par. 15.35)



    Sec. 15.35. Franchise taxes payable by domestic 
corporations. For the privilege of exercising its franchises in 
this State, each
domestic corporation shall pay to the 
Secretary of State the following
franchise taxes, computed on 
the basis, at the rates and for the periods
prescribed in this 
Act:

    (a) An initial franchise tax at the time of filing its 
first report of
issuance of shares.

    (b) An additional franchise tax at the time of filing (1) a 
report of
the issuance of additional shares, or (2) a report of 
an increase in paid-in
capital without the issuance of shares, 
or (3) an amendment to the articles
of incorporation or a 
report of cumulative changes in paid-in capital,
whenever any 
amendment or such report discloses an increase in its paid-in

capital over the amount thereof last reported in any document, 
other than
an annual report, interim annual report or final 
transition annual report
required by this Act to be filed in 
the office of the Secretary of State.

    (c) An additional franchise tax at the time of filing a 
report of paid-in
capital following a statutory merger or 
consolidation, which discloses that
the paid-in capital of the 
surviving or new corporation immediately after
the merger or 
consolidation is greater than the sum of the paid-in capital
of 
all of the merged or consolidated corporations as last reported

by them in any documents, other than annual reports, required 
by this Act
to be filed in the office of the Secretary of 
State; and in addition, the
surviving or new corporation shall 
be liable for a further additional franchise
tax on the paid-in 
capital of each of the merged or consolidated
corporations as 
last reported by them in any document, other than an annual

report, required by this Act to be filed with the Secretary of 
State from
their taxable year end to the next succeeding 
anniversary month or, in
the case of a corporation which has 
established an extended filing month,
the extended filing month 
of the surviving or new corporation; however if
the taxable 
year ends within the 2 month period immediately preceding the

anniversary month or, in the case of a corporation which has 
established an
extended filing month, the extended filing month 
of the surviving or new
corporation the tax will be computed to 
the anniversary month or, in the
case of a corporation which 
has established an extended filing month, the
extended filing 
month of the surviving or new corporation in the next

succeeding calendar year.

    (d) An annual franchise tax payable each year with the 
annual report
which the corporation is required by this Act to 
file.

    (e) On or after January 1, 2020 and prior to January 1, 
2021, the first $30 in liability is exempt from the tax imposed 
under this Section.  On or after January 1, 2021 and prior to 
January 1, 2022, the first $1,000 in liability is exempt from 
the tax imposed under this Section. On or after January 1, 2022 
and prior to January 1, 2023, the first $10,000 in liability is 
exempt from the tax imposed under this Section. On or after 
January 1, 2023 and prior to January 1, 2024, the first 
$100,000 in liability is exempt from the tax imposed under this 
Section. The provisions of this Section shall not require the 
payment of any franchise tax that would otherwise have been due 
and payable on or after January 1, 2024. There shall be no 
refunds or proration of franchise tax for any taxes due and 
payable on or after January 1, 2024 on the basis that a portion 
of the corporation's taxable year extends beyond January 1, 
2024. This amendatory Act of the 101st General Assembly shall 
not affect any right accrued or established, or any liability 
or penalty incurred prior to January 1, 2024. 
    (f) This Section is repealed on  December 31, 2025. 
(Source: P.A. 86-985.)

 



    (805 ILCS 5/15.65)  (from Ch. 32, par. 15.65)



    Sec. 15.65. Franchise taxes payable by foreign 
corporations. For the privilege of exercising its authority to 
transact such business
in this State as set out in its 
application therefor or any amendment
thereto, each foreign 
corporation shall pay to the Secretary of State the
following 
franchise taxes, computed on the basis, at the rates and for 
the
periods prescribed in this Act:

    (a) An initial franchise tax at the time of filing its 
application for
authority to transact business in this State.

    (b) An additional franchise tax at the time of filing (1) a 
report of
the issuance of additional shares, or (2) a report of 
an increase in paid-in
capital without the issuance of shares, 
or (3) a report of cumulative
changes in paid-in capital or a 
report of an exchange or reclassification
of shares, whenever 
any such report discloses an increase in its paid-in
capital 
over the amount thereof last reported in any document, other 
than
an annual report, interim annual report or final 
transition annual report,
required by this Act to be filed in 
the office of the Secretary of State.

    (c) Whenever the corporation shall be a party to a 
statutory merger and
shall be the surviving corporation, an 
additional franchise tax at the time
of filing its report 
following merger, if such report discloses that the
amount 
represented in this State of its paid-in capital immediately 
after
the merger is greater than the aggregate of the amounts 
represented in this
State of the paid-in capital of such of the 
merged corporations as were
authorized to transact business in 
this State at the time of the merger, as
last reported by them 
in any documents, other than annual reports, required
by this 
Act to be filed in the office of the  Secretary of State; and in

addition, the surviving corporation shall be liable for a 
further
additional franchise tax on the paid-in capital of each 
of the merged
corporations as last reported by them in any 
document, other than an annual
report, required by this Act to 
be filed with the Secretary
of State, from their taxable year 
end to the next succeeding anniversary
month or, in the case of 
a corporation which has established an extended
filing month, 
the extended filing month of the surviving corporation;
however 
if the taxable year ends within the 2 month period immediately

preceding the anniversary month or the extended filing month of 
the
surviving corporation, the tax will be computed to the 
anniversary or,
extended filing month of the surviving 
corporation in the next succeeding
calendar year.

    (d) An annual franchise tax payable each year with any

annual report which the corporation is required by this Act to 
file.

    (e) On or after January 1, 2020 and prior to January 1, 
2021, the first $30 in liability is exempt from the tax imposed 
under this Section.  On or after January 1, 2021 and prior to 
January 1, 2022, the first $1,000 in liability is exempt from 
the tax imposed under this Section. On or after January 1, 2022 
and prior to January 1, 2023, the first $10,000 in liability is 
exempt from the tax imposed under this Section. On or after 
January 1, 2023 and prior to January 1, 2024, the first 
$100,000 in liability is exempt from the tax imposed under this 
Section. The provisions of this Section shall not require the 
payment of any franchise tax that would otherwise have been due 
and payable on or after January 1, 2024. There shall be no 
refunds or proration of franchise tax for any taxes due and 
payable on or after January 1, 2024 on the basis that a portion 
of the corporation's taxable year extends beyond January 1, 
2024. This amendatory Act of the 101st General Assembly shall 
not affect any right accrued or established, or any liability 
or penalty incurred prior to January 1, 2024. 
    (f) This Section is repealed on December 31, 2024. 
(Source: P.A. 92-33, eff. 7-1-01.)

 


    (805 ILCS 5/15.97)  (from Ch. 32, par. 15.97)




    Sec. 15.97. Corporate Franchise Tax Refund Fund. 

    (a) Beginning July 1, 1993, a percentage of the amounts 
collected
under Sections 15.35, 15.45, 15.65, and 15.75 of this 
Act shall be
deposited into the Corporate Franchise Tax Refund 
Fund, a special Fund
hereby created in the State treasury.  From 
July 1, 1993, until December 31,
1994, there shall be deposited 
into the Fund 3% of the amounts received
under those Sections.  
Beginning January 1, 1995, and for each fiscal year
beginning 
thereafter, 2% of the amounts collected under those Sections

during the preceding fiscal year shall be deposited into the 
Fund.

    (b) Beginning July 1, 1993, moneys in the Fund shall be 
expended
exclusively for the purpose of paying refunds payable 
because of overpayment
of franchise taxes, penalties, or 
interest under Sections 13.70, 15.35,
15.45, 15.65, 15.75, and 
16.05 of this
Act and making transfers authorized under this 
Section.  Refunds in
accordance with the provisions of 
subsections (f) and (g) of Section 1.15
and Section 1.17 of 
this Act may be made from the Fund only to the extent that

amounts collected under Sections 15.35, 15.45, 15.65, and 15.75 
of this Act
have been deposited in the Fund and remain 
available.  On or before August 31 of each year, the balance in 
the Fund in excess of $100,000 shall be transferred to the 
General Revenue Fund. Notwithstanding the provisions of this 
subsection, for the period commencing on or after July 1, 2022, 
amounts in the fund shall not be transferred to the General 
Revenue Fund and shall be used to pay refunds in accordance 
with the provisions of this Act. Within a reasonable time after 
December 31, 2022, the Secretary of State shall direct and the 
Comptroller shall order transferred to the General Revenue Fund 
all amounts remaining in the fund. 

    (c) This Act shall constitute an irrevocable and continuing

appropriation from the Corporate Franchise Tax Refund Fund for 
the purpose
of paying refunds upon the order of the Secretary 
of State in accordance
with the provisions of this Section.

    (d) This Section is repealed on December 31, 2022. 
(Source: P.A. 99-620, eff. 1-1-17.)

 
ARTICLE 99.   EFFECTIVE DATE

 
    Section 999. Effective date. This Act takes effect upon 
becoming law.