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Public Act 097-0905 | ||||
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AN ACT concerning revenue.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Enterprise Zone Act is amended by | ||||
changing Sections 3, 4, 5.2, 5.3, 5.5, and 6 and by adding | ||||
Sections 4.1, 5.2.1, 8.1, and 8.2 as follows:
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(20 ILCS 655/3) (from Ch. 67 1/2, par. 603)
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Sec. 3. Definition. As used in this Act, the following | ||||
words shall
have the meanings ascribed to them, unless the | ||||
context otherwise requires:
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(a) "Department" means the Department of Commerce and | ||||
Economic Opportunity.
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(b) "Enterprise Zone" means an area of the State certified | ||||
by the Department
as an Enterprise Zone pursuant to this Act.
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(c) "Depressed Area" means an area in which pervasive | ||||
poverty, unemployment
and economic distress exist.
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(d) "Designated Zone Organization" means an association or | ||||
entity: (1)
the members of which are substantially all | ||||
residents of the Enterprise Zone;
(2) the board of directors of | ||||
which is elected by the members of the organization;
(3) which | ||||
satisfies the criteria set forth in Section 501(c) (3) or | ||||
501(c) (4) of the
Internal Revenue Code; and (4) which exists | ||||
primarily for the purpose of
performing within such area or |
zone for the benefit of the residents and businesses
thereof | ||
any of the functions set forth in Section 8 of this Act.
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(e) "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, body politic and corporate of
the State; | ||
and each administrative unit or corporate outgrowth of the | ||
State
government which is created by or pursuant to statute, | ||
other than units
of local government and their officers, school | ||
districts and boards of election
commissioners; each | ||
administrative unit or corporate outgrowth of the above
and as | ||
may be created by executive order of the Governor. No entity | ||
shall
be considered an "agency" for the purposes of this Act | ||
unless authorized
by law to make rules or regulations.
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(f) "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
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affecting private rights or procedures available to persons or | ||
entities
outside the agency, (ii) intra-agency memoranda, or | ||
(iii) the prescription
of standardized forms.
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(g) "Board" means the Enterprise Zone Board created in | ||
Section 5.2.1. | ||
(h) "Local labor market area" means an economically | ||
integrated area within which individuals can reside and find |
employment within a reasonable distance or can readily change | ||
jobs without changing their place of residence. | ||
(i) "Full-time equivalent job" means a job in which the new | ||
employee works for the recipient or for a corporation under | ||
contract to the recipient at a rate of at least 35 hours per | ||
week. A recipient who employs labor or services at a specific | ||
site or facility under contract with another may declare one | ||
full-time, permanent job for every 1,820 man hours worked per | ||
year under that contract. Vacations, paid holidays, and sick | ||
time are included in this computation. Overtime is not | ||
considered a part of regular hours. | ||
(j) "Full-time retained job" means any employee defined as | ||
having a full-time or full-time equivalent job preserved at a | ||
specific facility or site, the continuance of which is | ||
threatened by a specific and demonstrable threat, which shall | ||
be specified in the application for development assistance. A | ||
recipient who employs labor or services at a specific site or | ||
facility under contract with another may declare one retained | ||
employee per year for every 1,750 man hours worked per year | ||
under that contract, even if different individuals perform | ||
on-site labor or services. | ||
(Source: P.A. 94-793, eff. 5-19-06.)
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(20 ILCS 655/4) (from Ch. 67 1/2, par. 604)
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Sec. 4. Qualifications for Enterprise Zones. (1) An area is | ||
qualified to become an enterprise zone which:
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(a) is a contiguous area, provided that a zone area may | ||
exclude wholly
surrounded territory within its boundaries;
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(b) comprises a minimum of one-half square mile and not | ||
more than 12
square miles, or 15 square miles if the zone is | ||
located within the
jurisdiction of 4 or more counties or | ||
municipalities, in total area,
exclusive of lakes and | ||
waterways;
however, in such cases where the enterprise zone is | ||
a joint effort of
three or more units of government, or two or | ||
more units of government if
situated in a township which is | ||
divided by a municipality of 1,000,000 or
more inhabitants, and | ||
where the certification has been in
effect at least one year, | ||
the total area shall comprise a minimum of
one-half square mile | ||
and not more than thirteen square miles in total area
exclusive | ||
of lakes and waterways;
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(c) (blank) is a depressed area ;
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(d) (blank); satisfies any additional criteria established | ||
by regulation of the
Department consistent with the purposes of | ||
this Act ; and
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(e) is (1) entirely within a municipality or (2) entirely | ||
within
the unincorporated
areas of a county, except where | ||
reasonable need is established for such
zone to cover portions | ||
of more than one municipality or county or (3)
both comprises | ||
(i) all or part of a municipality and (ii) an unincorporated
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area of a county ; and .
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(f) meets 3 or more of the following criteria: | ||
(1) all or part of the local labor market area has had |
an annual average unemployment rate of at least 120% of the | ||
State's annual average unemployment rate for the most | ||
recent calendar year or the most recent fiscal year as | ||
reported by the Department of Employment Security; | ||
(2) designation will result in the development of | ||
substantial employment opportunities by creating or | ||
retaining a minimum aggregate of 1,000 full-time | ||
equivalent jobs due to an aggregate investment of | ||
$100,000,000 or more, and will help alleviate the effects | ||
of poverty and unemployment within the local labor market | ||
area; | ||
(3) all or part of the local labor market area has a | ||
poverty rate of at least 20% according to the latest | ||
federal decennial census, 50% or more of children in the | ||
local labor market area participate in the federal free | ||
lunch program according to reported statistics from the | ||
State Board of Education, or 20% or more households in the | ||
local labor market area receive food stamps according to | ||
the latest federal decennial census; | ||
(4) an abandoned coal mine or a brownfield (as defined | ||
in Section 58.2 of the Environmental Protection Act) is | ||
located in the proposed zone area, or all or a portion of | ||
the proposed zone was declared a federal disaster area in | ||
the 3 years preceding the date of application; | ||
(5) the local labor market area contains a presence of | ||
large employers that have downsized over the years, the |
labor market area has experienced plant closures in the 5 | ||
years prior to the date of application affecting more than | ||
50 workers, or the local labor market area has experienced | ||
State or federal facility closures in the 5 years prior to | ||
the date of application affecting more than 50 workers; | ||
(6) based on data from Multiple Listing Service | ||
information or other suitable sources, the local labor | ||
market area contains a high floor vacancy rate of | ||
industrial or commercial properties, vacant or demolished | ||
commercial and industrial structures are prevalent in the | ||
local labor market area, or industrial structures in the | ||
local labor market area are not used because of age, | ||
deterioration, relocation of the former occupants, or | ||
cessation of operation; | ||
(7) the applicant demonstrates a substantial plan for | ||
using the designation to improve the State and local | ||
government tax base, including income, sales, and property | ||
taxes; | ||
(8) significant public infrastructure is present in | ||
the local labor market area in addition to a plan for | ||
infrastructure development and improvement; | ||
(9) high schools or community colleges located within | ||
the local labor market area are engaged in ACT Work Keys, | ||
Manufacturing Skills Standard Certification, or other | ||
industry-based credentials that prepare students for | ||
careers; or |
(10) the change in equalized assessed valuation of | ||
industrial and/or commercial properties in the 5 years | ||
prior to the date of application is equal to or less than | ||
50% of the State average change in equalized assessed | ||
valuation for industrial and/or commercial properties, as | ||
applicable, for the same period of time. | ||
As provided in Section 10-5.3 of the River Edge | ||
Redevelopment Zone Act, upon the expiration of the term of each | ||
River Edge Redevelopment Zone in existence on the effective | ||
date of this amendatory Act of the 97th General Assembly, that | ||
River Edge Redevelopment Zone will become available for its | ||
previous designee or a new applicant to compete for designation | ||
as an enterprise zone. No preference for designation will be | ||
given to the previous designee of the zone. | ||
(2) Any criteria established by the Department or by law | ||
which utilize the rate
of unemployment for a particular area | ||
shall provide that all persons who
are not presently employed | ||
and have exhausted all unemployment benefits
shall be | ||
considered unemployed, whether or not such persons are actively
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seeking employment.
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(Source: P.A. 86-803.)
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(20 ILCS 655/4.1 new) | ||
Sec. 4.1. Department recommendations. | ||
(a) For all applications that qualify under Section 4 of | ||
this Act, the Department shall issue recommendations by |
assigning a score to each applicant. The scores will be | ||
determined by the Department, based on the extent to which an | ||
applicant meets the criteria points under subsection (f) of | ||
Section 4 of this Act. Scores will be determined using the | ||
following scoring system: | ||
(1) Up to 50 points for the extent to which the | ||
applicant meets the criteria in item (1) of subsection (f) | ||
of Section 4 of this Act. | ||
(2) Up to 50 points for the extent to which the | ||
applicant meets the criteria in item (2) of subsection (f) | ||
of Section 4 of this Act. | ||
(3) Up to 40 points for the extent to which the | ||
applicant meets the criteria in item (3) of subsection (f) | ||
of Section 4 of this Act. | ||
(4) Up to 30 points for the extent to which the | ||
applicant meets the criteria in item (4) of subsection (f) | ||
of Section 4 of this Act. | ||
(5) Up to 50 points for the extent to which the | ||
applicant meets the criteria in item (5) of subsection (f) | ||
of Section 4 of this Act. | ||
(6) Up to 40 points for the extent to which the | ||
applicant meets the criteria in item (6) of subsection (f) | ||
of Section 4 of this Act. | ||
(7) Up to 30 points for the extent to which the | ||
applicant meets the criteria in item (7) of subsection (f) | ||
of Section 4 of this Act. |
(8) Up to 50 points for the extent to which the | ||
applicant meets the criteria in item (8) of subsection (f) | ||
of Section 4 of this Act. | ||
(9) Up to 40 points for the extent to which the | ||
applicant meets the criteria in item (9) of subsection (f) | ||
of Section 4 of this Act. | ||
(10) Up to 40 points for the extent to which the | ||
applicant meets the criteria in item (10) of subsection (f) | ||
of Section 4 of this Act. | ||
(b) After assigning a score for each of the individual | ||
criteria using the point system as described in subsection (a), | ||
the Department shall then take the sum of the scores for each | ||
applicant and assign a final score. The Department shall then | ||
submit this information to the Board, as required in subsection | ||
(c) of Section 5.2, as its recommendation.
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(20 ILCS 655/5.2) (from Ch. 67 1/2, par. 607)
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Sec. 5.2. Department Review of Enterprise Zone | ||
Applications. | ||
(a) All
applications which are to be considered and acted | ||
upon by the Department
during a calendar year must be received | ||
by the Department no later than
December 31 of the preceding | ||
calendar year.
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Any application received on or after December 31 January 1 | ||
of any calendar year shall
be held by the Department for | ||
consideration and action during the following
calendar year.
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Each enterprise zone application shall include a specific | ||
definition of the applicant's local labor market area. | ||
(a-5) The Department shall, no later than March 31, 2013, | ||
develop an application process for an enterprise zone | ||
application. The Department has emergency rulemaking authority | ||
for the purpose of application development only until 9 months | ||
after the effective date of this amendatory Act of the 97th | ||
General Assembly. | ||
(b) Upon receipt of an application from a county or | ||
municipality the Department
shall review the application to | ||
determine whether the designated area
qualifies as an | ||
enterprise zone under Section 4 of this Act.
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(c) No later than June 30 May 1 , the Department shall | ||
notify all applicant municipalities
and counties of the | ||
Department's determination of the qualification of their
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respective designated enterprise zone areas , and shall send | ||
qualifying applications, including the applicant's scores for | ||
items (1) through (10) of subsection (a) of Section 4.1 and the | ||
applicant's final score under that Section, to the Board .
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(d) If any such designated area is found to be qualified to | ||
be an enterprise
zone by the Department under subsection (c) of | ||
this Section , the Department shall, no later than July 15 May | ||
15 , send a letter of notification to each member of the General | ||
Assembly whose legislative district or representative district | ||
contains all or part of the designated area and publish a | ||
notice in at
least one newspaper of general circulation within |
the proposed zone area
to notify the general public of the | ||
application and their opportunity to
comment. Such notice shall | ||
include a description of the area and a brief
summary of the | ||
application and shall indicate locations where the applicant
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has provided copies of the application for public inspection. | ||
The notice
shall also indicate appropriate procedures for the | ||
filing of written comments
from zone residents, business, civic | ||
and other organizations and property
owners to the Department.
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(e) (Blank). By July 1 of each calendar year, the | ||
Department shall either approve
or deny all applications filed | ||
by December 31 of the preceding calendar year.
If approval of | ||
an application filed by December 31 of any calendar year
is not | ||
received by July 1 of the following calendar year, the | ||
application
shall be considered denied. If an application is | ||
denied, the Department
shall inform the county or municipality | ||
of the specific reasons for the denial.
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(f) (Blank). Preference in Designation. In determining | ||
which designated areas
shall be approved and certified as | ||
Enterprise Zones, the Department shall
give preference to:
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(1) Areas with high levels of poverty, unemployment, job | ||
and population
loss, and general distress; and
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(2) Areas which have evidenced with widest support from the | ||
county or
municipality seeking to have such areas designated as | ||
Enterprise Zones,
community residents, local business, labor | ||
and neighborhood organizations
and where there are plans for | ||
the disposal of publicly owned real property
as described in |
Section 10; and
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(3) Areas for which a specific plan has been submitted to | ||
effect economic
growth and expansion and neighborhood | ||
revitalization for the benefit of
Zone residents and existing | ||
business through efforts which may include but
need not be | ||
limited to a reduction of tax rates or fees, an increase in
the | ||
level and efficiency of local services, and a simplification or | ||
streamlining
of governmental requirements applicable to | ||
employers or employees, taking
into account the resources | ||
available to the county or municipality seeking
to have an area | ||
designated as an Enterprise Zone to make such efforts; and
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(4) Areas for which there is evidence of prior consultation | ||
between the
county or municipality seeking designation of an | ||
area as an Enterprise Zone
and business, labor and neighborhood | ||
organizations within the proposed Zone;
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(5) Areas for which a specific plan has been submitted | ||
which will or may
be expected to benefit zone residents and | ||
workers by increasing their ownership
opportunities and | ||
participation in enterprise zone development;
| ||
(6) Areas in which specific governmental functions are to | ||
be performed
by designated neighborhood organizations in | ||
partnership with the county
or municipality seeking | ||
designation of an area as an Enterprise Zone.
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(g) (Blank). At least 2/5 of all new enterprise zones | ||
approved and certified by
the Department during any calendar | ||
year shall be located wholly or partially
within counties with |
unemployment rates of or above 8% for at least one
month during | ||
the 12-month
calendar year preceding the calendar year in which | ||
the applications are to
be considered and acted upon by the | ||
Department.
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(h) (Blank). The Department's determination of whether to | ||
certify an enterprise
zone shall be based on the purposes of | ||
this Act, the criteria set forth
in Section 4 and subsections | ||
(f) and
(g) of Section 5.2, and any additional criteria
adopted | ||
by regulation of the Department under paragraph (d) of Section | ||
4.
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(Source: P.A. 85-870.)
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(20 ILCS 655/5.2.1 new) | ||
Sec. 5.2.1. Enterprise Zone Board. | ||
(a) An Enterprise Zone Board is hereby created within the | ||
Department. | ||
(b) The Board shall consist of the following 5 members: | ||
(1) the Director of Commerce and Economic Opportunity, | ||
or his or her designee, who shall serve as chairperson; | ||
(2) the Director of Revenue, or his or her designee; | ||
and | ||
(3) three members appointed by the Governor, with the | ||
advice and consent of the Senate. | ||
Board members shall serve without compensation but may be | ||
reimbursed for necessary expenses incurred in the performance | ||
of their duties. |
(c) Each member appointed under item (3) of subsection (b) | ||
shall have at least 5 years of experience in business, economic | ||
development, or site location. Of the members appointed under | ||
item (3) of subsection (b): one member shall reside in Cook | ||
County; one member shall reside in DuPage, Kane, Lake, McHenry, | ||
or Will County; and one member shall reside in a county other | ||
than Cook, DuPage, Kane, Lake, McHenry, or Will. | ||
(d) Of the initial members appointed under item (3) of | ||
subsection (b): one member shall serve for a term of 2 years; | ||
one member shall serve for a term of 3 years; and one member | ||
shall serve for a term of 4 years. Thereafter, all members | ||
appointed under item (3) of subsection (b) shall serve for | ||
terms of 4 years. Members appointed under item (3) of | ||
subsection (b) may be reappointed. The Governor may remove a | ||
member appointed under item (3) of subsection (b) for | ||
incompetence, neglect of duty, or malfeasance in office. | ||
(e) By September 30, 2014, and September 30 of each year | ||
thereafter, all applications filed by December 31 of the | ||
preceding calendar year and deemed qualified by the Department | ||
shall be approved or denied by the Board. If such application | ||
is not approved by September 30, the application shall be | ||
considered denied. If an application is denied, the Board shall | ||
inform the applicant of the specific reasons for the denial. | ||
(f) A majority of the Board will determine whether an | ||
application is approved or denied. The Board is not, at any | ||
time, required to designate an enterprise zone. |
(g) In determining which designated areas shall be approved | ||
and certified as enterprise zones, the Board shall give | ||
preference to the extent to which the area meets the criteria | ||
set forth in Section 4.
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(20 ILCS 655/5.3) (from Ch. 67 1/2, par. 608)
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Sec. 5.3. Certification of Enterprise Zones; Effective | ||
date.
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(a) Certification of Board-approved Approval of designated | ||
Enterprise Zones shall be made by the
Department by | ||
certification of the designating ordinance. The Department
| ||
shall promptly issue a certificate for each Enterprise Zone | ||
upon its
approval by the Board . The certificate shall be signed | ||
by the Director of the
Department, shall make specific | ||
reference to the designating ordinance,
which shall be attached | ||
thereto, and shall be filed in the office of the
Secretary of | ||
State. A certified copy of the Enterprise Zone Certificate, or
| ||
a duplicate original thereof, shall be recorded in the office | ||
of recorder
of deeds of the county in which the Enterprise Zone | ||
lies.
| ||
(b) An Enterprise Zone shall be effective on January 1 of | ||
the first calendar year after Department upon its | ||
certification. The
Department shall transmit a copy of the | ||
certification to the Department
of Revenue, and to the | ||
designating municipality or county.
| ||
Upon certification of an Enterprise Zone, the terms and |
provisions of the
designating ordinance shall be in effect, and | ||
may not be amended or repealed
except in accordance with | ||
Section 5.4.
| ||
(c) With the exception of Enterprise Zones scheduled to | ||
expire before December 31, 2018, an An Enterprise Zone | ||
designated before the effective date of this amendatory Act of | ||
the 97th General Assembly shall be in effect for 30 calendar | ||
years, or for
a lesser number of years specified in the | ||
certified designating ordinance.
Each Enterprise Zone in | ||
existence on the effective date of this amendatory Act of the | ||
97th General Assembly that is scheduled to expire before July | ||
1, 2016 will have its termination date extended until July 1, | ||
2016. An Enterprise Zone designated on or after the effective | ||
date of this amendatory Act of the 97th General Assembly shall | ||
be in effect for a term of 15 calendar years, or for a lesser | ||
number of years specified in the certified designating | ||
ordinance. An enterprise zone designated on or after the | ||
effective date of this amendatory Act of the 97th General | ||
Assembly shall be subject to review by the Board after 13 years | ||
for an additional 10-year designation. Enterprise Zones shall | ||
terminate at midnight of December 31 of the final
calendar year | ||
of the certified term, except as provided in Section 5.4.
| ||
(d) No more than 12 Enterprise Zones may be certified by | ||
the Department
in calendar year 1984, no more than 12 | ||
Enterprise Zones may be certified
by the Department in calendar | ||
year 1985, no more than 13 Enterprise
Zones may be certified by |
the Department in calendar year 1986, no
more than 15 | ||
Enterprise Zones may be certified by the Department in
calendar | ||
year 1987, and no more than 20 Enterprise Zones may be | ||
certified
by the Department in calendar year 1990. In other | ||
calendar years, no more
than 13 Enterprise Zones may be | ||
certified by the Department.
The Department may also designate | ||
up to 8 additional Enterprise Zones
outside the regular | ||
application cycle if warranted by the extreme economic
| ||
circumstances as determined by the Department. The Department | ||
may also
designate one additional Enterprise Zone outside the | ||
regular application
cycle if an aircraft manufacturer agrees to | ||
locate
an aircraft manufacturing facility in the proposed | ||
Enterprise Zone.
Notwithstanding any
other provision of this | ||
Act, no more than 89 Enterprise Zones may be
certified by the | ||
Department for the 10 calendar years commencing with 1983.
The | ||
7 additional Enterprise Zones authorized by Public Act
86-15 | ||
shall not lie within municipalities or unincorporated areas of
| ||
counties that abut or are contiguous to Enterprise Zones | ||
certified pursuant
to this Section prior to June 30, 1989. The | ||
7 additional Enterprise
Zones (excluding the additional | ||
Enterprise Zone which may be designated
outside the regular | ||
application cycle) authorized by Public Act 86-1030
shall not | ||
lie within municipalities or unincorporated areas of counties
| ||
that abut or are contiguous to Enterprise Zones certified | ||
pursuant to this
Section prior to February 28, 1990. Beginning | ||
in calendar year 2004 and until
December 31, 2008, one |
additional enterprise zone may be certified by the
Department. | ||
In any calendar year, the
Department
may not certify more than | ||
3 Zones located within the same municipality. The
Department | ||
may certify Enterprise Zones in each of the 10 calendar years
| ||
commencing with 1983. The Department may not certify more than | ||
a total of
18 Enterprise Zones located within the same county | ||
(whether within
municipalities or within unincorporated | ||
territory) for the 10 calendar years
commencing with 1983. | ||
Thereafter, the Department may not certify any
additional | ||
Enterprise Zones, but may amend and rescind certifications of
| ||
existing Enterprise Zones in accordance with Section 5.4.
| ||
(e) Notwithstanding any other provision of law, if (i) the | ||
county board of
any county in which a current military base is | ||
located, in part or in whole, or
in which a military
base that | ||
has been closed within 20 years of the effective date of this
| ||
amendatory Act of 1998 is located, in part or in whole, adopts | ||
a designating
ordinance in accordance with Section 5 of this | ||
Act to designate the military
base in that county as an | ||
enterprise zone and (ii) the property otherwise
meets the
| ||
qualifications for an enterprise zone as prescribed in Section | ||
4 of this Act,
then the Department may certify the designating | ||
ordinance or ordinances, as the
case may be.
| ||
(f) Applications for Enterprise Zones that are scheduled to | ||
expire in 2016, 2017, or 2018, including Enterprise Zones that | ||
have been extended until 2016 by this amendatory Act of the | ||
97th General Assembly, shall be submitted to the Department no |
later than the date established by the Department by rule | ||
pursuant to Section 5.2. At that time, the Zone becomes | ||
available for either the previously designated area or a | ||
different area to compete for designation. No preference for | ||
designation as a Zone will be given to the previously | ||
designated area. | ||
For Enterprise Zones that are scheduled to expire on or | ||
after January 1, 2019, an application process shall begin 2 | ||
years prior to the year in which the Zone expires. At that | ||
time, the Zone becomes available for either the previously | ||
designated area or a different area to compete for designation. | ||
No preference for designation as a Zone will be given to the | ||
previously designated area. | ||
Each Enterprise Zone that reapplies for certification but | ||
does not receive a new certification shall expire on its | ||
scheduled termination date. | ||
(Source: P.A. 92-16, eff. 6-28-01; 92-777, eff. 1-1-03; 93-436, | ||
eff.
1-1-04.)
| ||
(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; 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". | ||
(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.
| ||
(Source: P.A. 95-18, eff. 7-30-07; 96-28, eff. 7-1-09.)
| ||
(20 ILCS 655/6) (from Ch. 67 1/2, par. 610)
|
Sec. 6. Powers and Duties of Department.
| ||
(A) General Powers. The Department shall administer this | ||
Act and shall
have the following powers and duties:
| ||
(1) To monitor the implementation of this Act and | ||
submit reports
evaluating
the effectiveness of the program | ||
and any suggestions for legislation to
the Governor and | ||
General Assembly by October 1 of every year preceding a
| ||
regular Session of the General Assembly and to annually | ||
report to the General
Assembly initial and current | ||
population, employment, per capita income,
number of | ||
business establishments , and dollar value of new | ||
construction and
improvements , and the aggregate value of | ||
each tax incentive, based on information provided by the | ||
Department of Revenue, for each Enterprise Zone.
| ||
(2) To promulgate all necessary rules and regulations | ||
to carry out the
purposes of this Act in accordance with | ||
The Illinois Administrative Procedure
Act.
| ||
(3) To assist municipalities and counties in obtaining | ||
Federal status
as an Enterprise Zone.
| ||
(B) Specific Duties:
| ||
(1) The Department shall provide information and | ||
appropriate assistance
to persons desiring to locate and | ||
engage in business in an enterprise zone,
to persons | ||
engaged in business in an enterprise zone and to designated | ||
zone
organizations operating there.
| ||
(2) The Department shall, in cooperation with |
appropriate units of local
government and State agencies, | ||
coordinate and streamline existing State
business | ||
assistance programs and permit and license application | ||
procedures
for Enterprise Zone businesses.
| ||
(3) The Department shall publicize existing tax | ||
incentives and economic
development programs within the | ||
Zone and upon request, offer technical
assistance
in | ||
abatement and alternative revenue source development to | ||
local units of
government which have enterprise Zones | ||
within their jurisdiction.
| ||
(4) The Department shall work together with the | ||
responsible State and
Federal agencies to promote the | ||
coordination of other relevant programs,
including but not | ||
limited to housing, community and economic development,
| ||
small business, banking, financial assistance, and | ||
employment training programs
which are carried on in an | ||
Enterprise Zone.
| ||
(5) In order to stimulate employment opportunities for | ||
Zone residents,
the Department, in cooperation with the | ||
Department of Human Services and the
Department of | ||
Employment Security, is to initiate a test of
the following | ||
2 programs within
the 12 month period following designation | ||
and approval by the Department
of the first enterprise | ||
zones: (i) the use of aid to families with dependent
| ||
children benefits payable under Article IV of the Illinois | ||
Public Aid Code,
General Assistance benefits payable under |
Article VI of the Illinois Public
Aid Code,
the | ||
unemployment insurance benefits payable under the | ||
Unemployment Insurance
Act as training or employment | ||
subsidies leading to unsubsidized employment;
and (ii) a | ||
program for voucher reimbursement of the cost of training | ||
zone
residents eligible under the Targeted Jobs Tax Credit | ||
provisions of the
Internal Revenue Code for employment in | ||
private industry. These programs
shall not be designed to | ||
subsidize businesses, but are intended to open
up job and | ||
training opportunities not otherwise available. Nothing in | ||
this
paragraph (5) shall be deemed to require zone | ||
businesses to utilize these
programs. These programs | ||
should be designed (i) for those individuals whose
| ||
opportunities for job-finding are minimal without program | ||
participation,
(ii) to minimize the period of benefit | ||
collection by such individuals, and
(iii) to accelerate the | ||
transition of those individuals to unsubsidized
| ||
employment. The Department is to seek agreement with | ||
business, organized
labor and the appropriate State | ||
Department and agencies on the design,
operation and | ||
evaluation of the test programs.
| ||
A report with recommendations including representative | ||
comments of these
groups shall be submitted by the Department | ||
to the county or municipality
which designated the area as an | ||
Enterprise Zone, Governor and General Assembly
not later than | ||
12 months after such test programs have commenced, or not
later |
than 3 months following the termination of such test programs, | ||
whichever
first occurs.
| ||
(Source: P.A. 89-507, eff. 7-1-97.)
| ||
(20 ILCS 655/8.1 new) | ||
Sec. 8.1. Accounting. | ||
(a) Any business receiving tax incentives due to its | ||
location within an Enterprise Zone or its designation as a High | ||
Impact Business must report the total Enterprise Zone or High | ||
Impact Business tax benefits received by the business, broken | ||
down by incentive category and enterprise zone, if applicable, | ||
annually to the Department of Revenue. Reports will be due no | ||
later than March 30 of each year and shall cover the previous | ||
calendar year. The first report will be for the 2012 calendar | ||
year and will be due no later than March 30, 2013. Failure to | ||
report data shall result in ineligibility to receive | ||
incentives. For the first offense, a business shall be given 60 | ||
days to comply. | ||
(b) Each person required to file a return under the Gas | ||
Revenue Tax Act, the Gas Use Tax Act, the Electricity Excise | ||
Tax Act, or the Telecommunications Excise Tax Act shall file, | ||
on or before March 30 of each year, a report with the | ||
Department of Revenue, in the manner and form required by the | ||
Department of Revenue, itemizing the amount of the deduction | ||
taken under each Act, respectively, due to the location of a | ||
business in an Enterprise Zone or its designation as a High |
Impact Business. The report shall be itemized by business and | ||
the business location address. | ||
(c) Employers shall report their job creation, retention, | ||
and capital investment numbers within the zone annually to the | ||
administrator, which will compile the information and report it | ||
to the Department of Revenue no later than March 30 of each | ||
calendar year. High Impact Businesses shall report their job | ||
creation, retention, and capital investment numbers directly | ||
to the Department of Revenue no later than March 30 of each | ||
year. | ||
(d) The Department of Revenue will aggregate and collect | ||
the tax, job, and capital investment data by Enterprise Zone | ||
and High Impact Business and report this information, formatted | ||
to exclude company-specific proprietary information, to the | ||
Department by May 1, 2013, and by May 1 of every calendar year | ||
thereafter. The Department will include this information in | ||
their required reports under Section 6 of this Act. | ||
(e) The Department of Revenue, in its discretion, may | ||
require that the reports filed under this Section be submitted | ||
electronically. | ||
(f) The Department of Revenue shall have the authority to | ||
adopt rules as are reasonable and necessary to implement the | ||
provisions of this Section. | ||
(20 ILCS 655/8.2 new) | ||
Sec. 8.2. Zone Administrator. |
(a) Each Zone Administrator designated under Section 8 of | ||
this Act shall post a copy of the boundaries of the Enterprise | ||
Zone on its official Internet website and shall provide an | ||
electronic copy to the Department. The Department shall post | ||
each copy of the boundaries of an Enterprise Zone that it | ||
receives from a Zone Administrator on its official Internet | ||
website. | ||
(b) The Zone Administrator shall collect and aggregate the | ||
following information: | ||
(1) the estimated cost of each building project, broken | ||
down into labor and materials; and | ||
(2) within 60 days after the end of the project, the | ||
estimated cost of each building project, broken down into | ||
labor and materials. | ||
(c) By April 1 of each year, each Zone Administrator shall | ||
file a copy of its fee schedule with the Department, and the | ||
Department shall review and approve the fee schedule. Zone | ||
Administrators shall charge no more than 0.5% of the cost of | ||
building materials of the project associated with the specific | ||
Enterprise Zone, with a maximum fee of no more than $50,000. | ||
Section 10. The Illinois Income Tax Act is amended by | ||
changing Sections 201 and 203 as follows: | ||
(35 ILCS 5/201) (from Ch. 120, par. 2-201) | ||
(Text of Section before amendment by P.A. 97-636 ) |
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 January 1, 2025, 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 January 1, 2025, and | ||
ending after December 31, 2024, an amount equal to the sum | ||
of (i) 3.75% of the taxpayer's net income for the period |
prior to January 1, 2025, as calculated under Section | ||
202.5, and (ii) 3.25% of the taxpayer's net income for the | ||
period after December 31, 2024, as calculated under Section | ||
202.5. | ||
(5.4) In the case of an individual, trust, or estate, | ||
for taxable years beginning on or after January 1, 2025, an | ||
amount equal to 3.25% 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 | ||
January 1, 2025, 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 January 1, 2025, and ending after | ||
December 31, 2024, an amount equal to the sum of (i) 5.25% | ||
of the taxpayer's net income for the period prior to | ||
January 1, 2025, as calculated under Section 202.5, and | ||
(ii) 4.8% of the taxpayer's net income for the period after | ||
December 31, 2024, as calculated under Section 202.5. | ||
(14) In the case of a corporation, for taxable years |
beginning on or after January 1, 2025, an amount equal to | ||
4.8% 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, 2013, except for costs incurred | ||
pursuant to a binding
contract entered into on or before | ||
December 31, 2013. | ||
(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%.
| ||
(g) Jobs Tax Credit; Enterprise Zone, River Edge | ||
Redevelopment Zone , and Foreign Trade Zone or Sub-Zone. | ||
(1) A taxpayer conducting a trade or business , in an | ||
enterprise zone
or a High Impact Business designated by the | ||
Department of Commerce and
Economic Opportunity or for | ||
taxable years ending on or after December 31, 2006, in a | ||
River Edge Redevelopment Zone or conducting a trade or | ||
business in a federally designated
Foreign Trade Zone or | ||
Sub-Zone shall be allowed a credit against the tax
imposed | ||
by subsections (a) and (b) of this Section in the amount of | ||
$500
per eligible employee hired to work in the zone during | ||
the taxable year. | ||
(2) To qualify for the credit: | ||
(A) the taxpayer must hire 5 or more eligible | ||
employees to work in a an
enterprise zone, River Edge | ||
Redevelopment Zone , or federally designated Foreign | ||
Trade Zone or Sub-Zone
during the taxable year; | ||
(B) the taxpayer's total employment within the | ||
enterprise zone, River Edge Redevelopment Zone , or
| ||
federally designated Foreign Trade Zone or Sub-Zone | ||
must
increase by 5 or more full-time employees beyond |
the total employed in that
zone at the end of the | ||
previous tax year for which a jobs tax
credit under | ||
this Section was taken, or beyond the total employed by | ||
the
taxpayer as of December 31, 1985, whichever is | ||
later; and | ||
(C) the eligible employees must be employed 180 | ||
consecutive days in
order to be deemed hired for | ||
purposes of this subsection. | ||
(3) An "eligible employee" means an employee who is: | ||
(A) Certified by the Department of Commerce and | ||
Economic Opportunity
as "eligible for services" | ||
pursuant to regulations promulgated in
accordance with | ||
Title II of the Job Training Partnership Act, Training
| ||
Services for the Disadvantaged or Title III of the Job | ||
Training Partnership
Act, Employment and Training | ||
Assistance for Dislocated Workers Program. | ||
(B) Hired after the enterprise zone, River Edge | ||
Redevelopment Zone , or federally designated Foreign
| ||
Trade Zone or Sub-Zone was designated or the trade or
| ||
business was located in that zone, whichever is later. | ||
(C) Employed in the enterprise zone, River Edge | ||
Redevelopment Zone , or Foreign Trade Zone or
Sub-Zone. | ||
An employee is employed in a an
enterprise zone or | ||
federally designated Foreign Trade Zone or Sub-Zone
if | ||
his services are rendered there or it is the base of
| ||
operations for the services performed. |
(D) A full-time employee working 30 or more hours | ||
per week. | ||
(4) For tax years ending on or after December 31, 1985 | ||
and prior to
December 31, 1988, the credit shall be allowed | ||
for the tax year in which
the eligible employees are hired. | ||
For tax years ending on or after
December 31, 1988, the | ||
credit shall be allowed for the tax year immediately
| ||
following the tax year in which the eligible employees are | ||
hired. 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,
earlier | ||
credit shall be applied first. | ||
(5) The Department of Revenue shall promulgate such | ||
rules and regulations
as may be deemed necessary to carry | ||
out the purposes of this subsection (g). | ||
(6) The credit shall be available for eligible | ||
employees hired on or
after January 1, 1986. | ||
(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). | ||
(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, | ||
2011, 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, and no credit may be | ||
carried forward to any taxable year ending on or after January | ||
1, 2011. | ||
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. | ||
(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 $500. In no event shall a | ||
credit under
this subsection reduce the taxpayer's liability | ||
under this Act to less than
zero. 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. | ||
(Source: P.A. 96-115, eff. 7-31-09; 96-116, eff. 7-31-09; | ||
96-937, eff. 6-23-10; 96-1000, eff. 7-2-10; 96-1496, eff. | ||
1-13-11; 97-2, eff. 5-6-11.) | ||
(Text of Section after amendment by P.A. 97-636 ) | ||
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 January 1, 2025, 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 January 1, 2025, and | ||
ending after December 31, 2024, an amount equal to the sum | ||
of (i) 3.75% of the taxpayer's net income for the period | ||
prior to January 1, 2025, as calculated under Section | ||
202.5, and (ii) 3.25% of the taxpayer's net income for the |
period after December 31, 2024, as calculated under Section | ||
202.5. | ||
(5.4) In the case of an individual, trust, or estate, | ||
for taxable years beginning on or after January 1, 2025, an | ||
amount equal to 3.25% 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 | ||
January 1, 2025, 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 January 1, 2025, and ending after | ||
December 31, 2024, an amount equal to the sum of (i) 5.25% | ||
of the taxpayer's net income for the period prior to | ||
January 1, 2025, as calculated under Section 202.5, and | ||
(ii) 4.8% of the taxpayer's net income for the period after | ||
December 31, 2024, as calculated under Section 202.5. | ||
(14) In the case of a corporation, for taxable years | ||
beginning on or after January 1, 2025, an amount equal to | ||
4.8% 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%.
| ||
(g) Jobs Tax Credit; Enterprise Zone, River Edge | ||
Redevelopment Zone , and Foreign Trade Zone or Sub-Zone. | ||
(1) A taxpayer conducting a trade or business , in an | ||
enterprise zone
or a High Impact Business designated by the | ||
Department of Commerce and
Economic Opportunity or for | ||
taxable years ending on or after December 31, 2006, in a | ||
River Edge Redevelopment Zone or conducting a trade or | ||
business in a federally designated
Foreign Trade Zone or | ||
Sub-Zone shall be allowed a credit against the tax
imposed | ||
by subsections (a) and (b) of this Section in the amount of | ||
$500
per eligible employee hired to work in the zone during | ||
the taxable year. | ||
(2) To qualify for the credit: | ||
(A) the taxpayer must hire 5 or more eligible | ||
employees to work in a an
enterprise zone, River Edge | ||
Redevelopment Zone , or federally designated Foreign | ||
Trade Zone or Sub-Zone
during the taxable year; | ||
(B) the taxpayer's total employment within the | ||
enterprise zone, River Edge Redevelopment Zone , or
| ||
federally designated Foreign Trade Zone or Sub-Zone | ||
must
increase by 5 or more full-time employees beyond | ||
the total employed in that
zone at the end of the | ||
previous tax year for which a jobs tax
credit under |
this Section was taken, or beyond the total employed by | ||
the
taxpayer as of December 31, 1985, whichever is | ||
later; and | ||
(C) the eligible employees must be employed 180 | ||
consecutive days in
order to be deemed hired for | ||
purposes of this subsection. | ||
(3) An "eligible employee" means an employee who is: | ||
(A) Certified by the Department of Commerce and | ||
Economic Opportunity
as "eligible for services" | ||
pursuant to regulations promulgated in
accordance with | ||
Title II of the Job Training Partnership Act, Training
| ||
Services for the Disadvantaged or Title III of the Job | ||
Training Partnership
Act, Employment and Training | ||
Assistance for Dislocated Workers Program. | ||
(B) Hired after the enterprise zone, River Edge | ||
Redevelopment Zone , or federally designated Foreign
| ||
Trade Zone or Sub-Zone was designated or the trade or
| ||
business was located in that zone, whichever is later. | ||
(C) Employed in the enterprise zone, River Edge | ||
Redevelopment Zone , or Foreign Trade Zone or
Sub-Zone. | ||
An employee is employed in a an
enterprise zone or | ||
federally designated Foreign Trade Zone or Sub-Zone
if | ||
his services are rendered there or it is the base of
| ||
operations for the services performed. | ||
(D) A full-time employee working 30 or more hours | ||
per week. |
(4) For tax years ending on or after December 31, 1985 | ||
and prior to
December 31, 1988, the credit shall be allowed | ||
for the tax year in which
the eligible employees are hired. | ||
For tax years ending on or after
December 31, 1988, the | ||
credit shall be allowed for the tax year immediately
| ||
following the tax year in which the eligible employees are | ||
hired. 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,
earlier | ||
credit shall be applied first. | ||
(5) The Department of Revenue shall promulgate such | ||
rules and regulations
as may be deemed necessary to carry | ||
out the purposes of this subsection (g). | ||
(6) The credit shall be available for eligible | ||
employees hired on or
after January 1, 1986. | ||
(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). | ||
(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, |
2016, 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. | ||
(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 $500. In no event shall a | ||
credit under
this subsection reduce the taxpayer's liability | ||
under this Act to less than
zero. 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. | ||
(Source: P.A. 96-115, eff. 7-31-09; 96-116, eff. 7-31-09; | ||
96-937, eff. 6-23-10; 96-1000, eff. 7-2-10; 96-1496, eff. | ||
1-13-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12.) | ||
(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-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-22) For taxable years beginning on or after | ||
January 1, 2009, 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; | ||
(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; | ||
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 an Enterprise
Zone or | ||
zones created under the Illinois Enterprise Zone Act or | ||
a River Edge Redevelopment Zone or zones created under | ||
the River Edge Redevelopment Zone Act, and conducts
| ||
substantially all of its operations in an Enterprise | ||
Zone or zones or 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(2) of the Internal Revenue Code, | ||
and all amounts of expenses allocable
to interest and | ||
disallowed as deductions by Section 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; and | ||
(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. | ||
(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; | ||
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 an Enterprise Zone or | ||
zones created under
the Illinois Enterprise Zone Act or | ||
a River Edge Redevelopment Zone or zones created under | ||
the River Edge Redevelopment Zone Act and conducts | ||
substantially all of its
operations in an Enterprise | ||
Zone or zones or 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 Enterprise
Zone | ||
Investment Credit or 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
Enterprise | ||
Zone or the River Edge Redevelopment Zone. The | ||
subtraction modification available to 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; | ||
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(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 an
Enterprise Zone or | ||
zones created under the Illinois Enterprise Zone Act or | ||
a River Edge Redevelopment Zone or zones created under | ||
the River Edge Redevelopment Zone Act and
conducts | ||
substantially all of its operations in an Enterprise | ||
Zone or Zones or 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. | ||
(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; | ||
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(2) of the Internal Revenue Code, | ||
and all amounts of expenses allocable to
interest and | ||
disallowed as deductions by Section 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 an Enterprise
Zone or | ||
zones created under the Illinois Enterprise Zone Act, | ||
enacted by
the 82nd General Assembly, or a River Edge |
Redevelopment Zone or zones created under the River | ||
Edge Redevelopment Zone Act and
conducts substantially | ||
all of its operations
in an Enterprise Zone or Zones or | ||
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. 96-45, eff. 7-15-09; 96-120, eff. 8-4-09; 96-198, | ||
eff. 8-10-09; 96-328, eff. 8-11-09; 96-520, eff. 8-14-09; | ||
96-835, eff. 12-16-09; 96-932, eff. 1-1-11; 96-935, eff. | ||
6-21-10; 96-1214, eff. 7-22-10; 97-333, eff. 8-12-11; 97-507, | ||
eff. 8-23-11.) | ||
Section 15. The Retailers' Occupation Tax Act is amended by | ||
changing Sections 5k and 5l as follows:
| ||
(35 ILCS 120/5k) (from Ch. 120, par. 444k)
| ||
Sec. 5k. Building materials exemption ; enterprise zone . | ||
(a) Each retailer who makes a qualified sale of building
| ||
materials
to be incorporated into real estate in an enterprise | ||
zone
established by a county or municipality under the Illinois | ||
Enterprise Zone
Act
by remodeling,
rehabilitation or new | ||
construction, may deduct receipts from such sales
when | ||
calculating the tax imposed by this Act.
For purposes of this | ||
Section, before July 1, 2013, "qualified sale" means a sale of | ||
building
materials that will be incorporated into real estate | ||
as part of a building
project for which a Certificate of |
Eligibility for Sales Tax Exemption has been
issued by the | ||
administrator of the enterprise zone in which the building
| ||
project is located , and on and after July 1, 2013, "qualified | ||
sale" means a sale of building materials that will be | ||
incorporated into real estate as part of a building project for | ||
which an Enterprise Zone Building Materials Exemption | ||
Certificate has been issued to the purchaser by the Department. | ||
A construction contractor or other entity shall not make | ||
tax-free purchases unless it has an active Exemption | ||
Certificate issued by the Department at the time of the | ||
purchase . | ||
(b) Before July 1, 2013, to To document the exemption | ||
allowed under this Section, the
retailer must obtain from the | ||
purchaser a copy of the Certificate of
Eligibility for Sales | ||
Tax Exemption issued by the administrator of the
enterprise | ||
zone into which the building materials will be incorporated. On | ||
and after July 1, 2013, to document the exemption allowed under | ||
this Section, the retailer must obtain from the purchaser the | ||
certification required under subsection (c), which must | ||
contain the Enterprise Zone Building Materials Exemption | ||
Certificate number issued to the purchaser by the Department.
| ||
Upon request from the enterprise zone administrator, the | ||
Department shall issue an Enterprise Zone Building Materials | ||
Exemption Certificate for each construction contractor or | ||
other entity identified by the enterprise zone administrator. | ||
The Department shall issue the Exemption Certificates directly |
to each construction contractor or other entity. The Department | ||
shall also provide the enterprise zone administrator with a | ||
copy of each Exemption Certificate issued. The request for | ||
Enterprise Zone Building Materials Exemption Certificates from | ||
the enterprise zone administrator to the Department must | ||
include the following information: | ||
(1) the name and address of the construction contractor | ||
or other entity; | ||
(2) the name and number of the enterprise zone; | ||
(3) the name and location or address of the building | ||
project in the enterprise zone; | ||
(4) the estimated amount of the exemption for each | ||
construction contractor or other entity for which a request | ||
for Exemption Certificate is made, based on a stated | ||
estimated average tax rate and the percentage of the | ||
contract that consists of materials; | ||
(5) the period of time over which supplies for the | ||
project are expected to be purchased; and | ||
(6) other reasonable information as the Department may | ||
require. | ||
The Department shall issue the Enterprise Zone Building | ||
Materials Exemption Certificates within 3 business days after | ||
receipt of request from the zone administrator. This | ||
requirement does not apply in circumstances where the | ||
Department, for reasonable cause, is unable to issue the | ||
Exemption Certificate within 3 business days. The Department |
may refuse to issue an Exemption Certificate if the owner, any | ||
partner, or a corporate officer, and in the case of a limited | ||
liability company, any manager or member, of the construction | ||
contractor or other entity is or has been the owner, a partner, | ||
a corporate officer, and in the case of a limited liability | ||
company, a manager or member, of a person that is in default | ||
for moneys due to the Department under this Act or any other | ||
tax or fee Act administered by the Department. The Enterprise | ||
Zone Building Materials Exemption Certificate shall contain | ||
language stating that if the construction contractor or other | ||
entity who is issued the Exemption Certificate makes a | ||
tax-exempt purchase, as described in this Section, that is not | ||
eligible for exemption under this Section or allows another | ||
person to make a tax-exempt purchase, as described in this | ||
Section, that is not eligible for exemption under this Section, | ||
then, in addition to any tax or other penalty imposed, the | ||
construction contractor or other entity is subject to a penalty | ||
equal to the tax that would have been paid by the retailer | ||
under this Act as well as any applicable local retailers' | ||
occupation tax on the purchase that is not eligible for the | ||
exemption. | ||
The Department, in its discretion, may require that the | ||
request for Enterprise Zone Building Materials Exemption | ||
Certificates be submitted electronically. The Department may, | ||
in its discretion, issue the Exemption Certificates | ||
electronically. The Enterprise Zone Building Materials |
Exemption Certificate number shall be designed in such a way | ||
that the Department can identify from the unique number on the | ||
Exemption Certificate issued to a given construction | ||
contractor or other entity, the name of the Enterprise Zone, | ||
the project for which the Exemption Certificate is issued, and | ||
the construction contractor or other entity to whom the | ||
Exemption Certificate is issued. The Exemption Certificate | ||
shall contain an expiration date, which shall be no more than 2 | ||
years after the date of issuance. At the request of the zone | ||
administrator, the Department may renew an Exemption | ||
Certificate. After the Department issues Exemption | ||
Certificates for a given enterprise zone project, the | ||
enterprise zone administrator may notify the Department of | ||
additional construction contractors or other entities eligible | ||
for an Enterprise Zone Building Materials Exemption | ||
Certificate. Upon notification by the enterprise zone | ||
administrator and subject to the other provisions of this | ||
subsection (b), the Department shall issue an Enterprise Zone | ||
Building Materials Exemption Certificate to each additional | ||
construction contractor or other entity identified by the | ||
enterprise zone administrator. An enterprise zone | ||
administrator may notify the Department to rescind an | ||
Enterprise Zone Building Materials Exemption Certificate | ||
previously issued by the Department but that has not yet | ||
expired. Upon notification by the enterprise zone | ||
administrator and subject to the other provisions of this |
subsection (b), the Department shall issue the rescission of | ||
the Enterprise Zone Building Materials Exemption Certificate | ||
to the construction contractor or other entity identified by | ||
the enterprise zone administrator and provide a copy to the | ||
enterprise zone administrator. | ||
If the Department of Revenue determines that a construction | ||
contractor or other entity that was issued an Exemption | ||
Certificate under this subsection (b) made a tax-exempt | ||
purchase, as described in this Section, that was not eligible | ||
for exemption under this Section or allowed another person to | ||
make a tax-exempt purchase, as described in this Section, that | ||
was not eligible for exemption under this Section, then, in | ||
addition to any tax or other penalty imposed, the construction | ||
contractor or other entity is subject to a penalty equal to the | ||
tax that would have been paid by the retailer under this Act as | ||
well as any applicable local retailers' occupation tax on the | ||
purchase that was not eligible for the exemption. The
| ||
Certificate of Eligibility for Sales Tax Exemption must | ||
contain:
| ||
(1) a statement that the building project identified in | ||
the Certificate
meets all the requirements for the building | ||
material exemption contained in the
enterprise zone | ||
ordinance of the jurisdiction in which the building project | ||
is
located;
| ||
(2) the location or address of the building project; | ||
and
|
(3) the signature of the administrator of the | ||
enterprise zone in which the
building project is located.
| ||
(c) In addition, the retailer must obtain certification | ||
from the purchaser that
contains:
| ||
(1) a statement that the building materials are being | ||
purchased for
incorporation into real estate located in an | ||
Illinois enterprise zone;
| ||
(2) the location or address of the real estate into | ||
which the building
materials will be incorporated;
| ||
(3) the name of the enterprise zone in which that real | ||
estate is located;
| ||
(4) a description of the building materials being | ||
purchased; and
| ||
(5) on and after July 1, 2013, the purchaser's | ||
Enterprise Zone Building Materials Exemption Certificate | ||
number issued by the Department; and | ||
(6) the purchaser's signature and date of purchase.
| ||
(d) The deduction allowed by
this Section for the sale of | ||
building materials may be limited, to the
extent authorized by | ||
ordinance, adopted after the effective date of this
amendatory | ||
Act of 1992, by the municipality or county that created the
| ||
enterprise zone
into which the
building materials will be | ||
incorporated.
The ordinance, however, may neither require nor | ||
prohibit the purchase of
building materials from any retailer | ||
or class of retailers in order to qualify
for the exemption | ||
allowed under this Section. The provisions of this Section
are |
exempt from Section
2-70.
| ||
(e) Notwithstanding anything to the contrary in this | ||
Section, for enterprise zone projects already in existence and | ||
for which construction contracts are already in place on July | ||
1, 2013, the request for Enterprise Zone Building Materials | ||
Exemption Certificates from the enterprise zone administrator | ||
to the Department for these pre-existing construction | ||
contractors and other entities must include the information | ||
required under subsection (b), but not including the | ||
information listed in items (4) and (5). For any new | ||
construction contract entered into on or after July 1, 2013, | ||
however, all of the information in subsection (b) must be | ||
provided. | ||
(Source: P.A. 91-51, eff. 6-30-99; 91-954, eff. 1-1-02; 92-484, | ||
eff.
8-23-01; 92-779, eff. 8-6-02.)
| ||
(35 ILCS 120/5l) (from Ch. 120, par. 444l)
| ||
Sec. 5l. Building materials exemption; High Impact | ||
Business. | ||
(a) Beginning January 1, 1995, each retailer who makes a | ||
sale of
building materials that will be incorporated into a | ||
High Impact Business
location as designated by the Department | ||
of Commerce and Economic Opportunity
under Section 5.5 of the | ||
Illinois Enterprise Zone Act may deduct receipts from
such | ||
sales when calculating only the 6.25% State rate of tax
imposed | ||
by this Act. Beginning on the effective date of this amendatory |
Act of
1995, a retailer may also deduct receipts from such | ||
sales when calculating any
applicable local taxes. However, | ||
until the effective date of this amendatory
Act of 1995, a | ||
retailer may file claims for credit or refund to recover the
| ||
amount of any applicable local tax paid on such sales. No | ||
retailer who is
eligible for the deduction or credit
under | ||
Section 5k of this Act for making a sale of building materials | ||
to be
incorporated into real estate in an enterprise zone by | ||
rehabilitation,
remodeling or new construction shall be | ||
eligible for the deduction or
credit authorized under this | ||
Section.
| ||
(b) In addition to any other requirements to document the | ||
exemption allowed under this Section, the retailer must obtain | ||
from the purchaser the purchaser's High Impact Business | ||
Building Materials Exemption Certificate number issued by the | ||
Department. A construction contractor or other entity shall not | ||
make tax-free purchases unless it has an active Exemption | ||
Certificate issued by the Department at the time of purchase. | ||
Upon request from the designated High Impact Business, the | ||
Department shall issue a High Impact Business Building | ||
Materials Exemption Certificate for each construction | ||
contractor or other entity identified by the designated High | ||
Impact Business. The Department shall issue the Exemption | ||
Certificates directly to each construction contractor or other | ||
entity. The Department shall also provide the designated High | ||
Impact Business with a copy of each Exemption Certificate |
issued. The request for Building Materials Exemption | ||
Certificates from the designated High Impact Business to the | ||
Department must include the following information: | ||
(1) the name and address of the construction contractor | ||
or other entity; | ||
(2) the name and location or address of the designated | ||
High Impact Business; | ||
(3) the estimated amount of the exemption for each | ||
construction contractor or other entity for which a request | ||
for Exemption Certificate is made, based on a stated | ||
estimated average tax rate and the percentage of the | ||
contract that consists of materials; | ||
(4) the period of time over which supplies for the | ||
project are expected to be purchased; and | ||
(5) other reasonable information as the Department may | ||
require. | ||
The Department shall issue the High Impact Business | ||
Building Materials Exemption Certificates within 3 business | ||
days after receipt of request from the designated High Impact | ||
Business. This requirement does not apply in circumstances | ||
where the Department, for reasonable cause, is unable to issue | ||
the Exemption Certificate within 3 business days. The | ||
Department may refuse to issue an Exemption Certificate if the | ||
owner, any partner, or a corporate officer, and in the case of | ||
a limited liability company, any manager or member, of the | ||
construction contractor or other entity is or has been the |
owner, a partner, a corporate officer, and in the case of a | ||
limited liability company, a manager or member, of a person | ||
that is in default for moneys due to the Department under this | ||
Act or any other tax or fee Act administered by the Department. | ||
The High Impact Business Building Materials Exemption | ||
Certificate shall contain language stating that if the | ||
construction contractor or other entity who is issued the | ||
Exemption Certificate makes a tax-exempt purchase, as | ||
described in this Section, that is not eligible for exemption | ||
under this Section or allows another person to make a | ||
tax-exempt purchase, as described in this Section, that is not | ||
eligible for exemption under this Section, then, in addition to | ||
any tax or other penalty imposed, the construction contractor | ||
or other entity is subject to a penalty equal to the tax that | ||
would have been paid by the retailer under this Act as well as | ||
any applicable local retailers' occupation tax on the purchase | ||
that is not eligible for the exemption. | ||
The Department, in its discretion, may require that the | ||
request for High Impact Business Building Materials Exemption | ||
Certificates be submitted electronically. The Department may, | ||
in its discretion, issue the Exemption Certificates | ||
electronically. The High Impact Business Building Materials | ||
Exemption Certificate number shall be designed in such a way | ||
that the Department can identify from the unique number on the | ||
Exemption Certificate issued to a given construction | ||
contractor or other entity, the name of the designated High |
Impact Business and the construction contractor or other entity | ||
to whom the Exemption Certificate is issued. The Exemption | ||
Certificate shall contain an expiration date, which shall be no | ||
more than 2 years after the date of issuance. At the request of | ||
the designated High Impact Business, the Department may renew | ||
an Exemption Certificate. After the Department issues | ||
Exemption Certificates for a given designated High Impact | ||
Business, the designated High Impact Business may notify the | ||
Department of additional construction contractors or other | ||
entities eligible for a Building Materials Exemption | ||
Certificate. Upon notification by the designated High Impact | ||
Business and subject to the other provisions of this subsection | ||
(b), the Department shall issue a High Impact Business Building | ||
Materials Exemption Certificate to each additional | ||
construction contractor or other entity identified by the | ||
designated High Impact Business. A designated High Impact | ||
Business may notify the Department to rescind a Building | ||
Materials Exemption Certificate previously issued by the | ||
Department but that has not yet expired. Upon notification by | ||
the designated High Impact Business and subject to the other | ||
provisions of this subsection (b), the Department shall issue | ||
the rescission of the Building Materials Exemption Certificate | ||
to the construction contractor or other entity identified by | ||
the designated High Impact Business and provide a copy to the | ||
designated High Impact Business. | ||
If the Department of Revenue determines that a construction |
contractor or other entity that was issued an Exemption | ||
Certificate under this subsection (b) made a tax-exempt | ||
purchase, as described in this Section, that was not eligible | ||
for exemption under this Section or allowed another person to | ||
make a tax-exempt purchase, as described in this Section, that | ||
was not eligible for exemption under this Section, then, in | ||
addition to any tax or other penalty imposed, the construction | ||
contractor or other entity is subject to a penalty equal to the | ||
tax that would have been paid by the retailer under this Act as | ||
well as any applicable local retailers' occupation tax on the | ||
purchase that was not eligible for the exemption. | ||
(c) Notwithstanding anything to the contrary in this | ||
Section, for High Impact Businesses for which projects are | ||
already in existence and for which construction contracts are | ||
already in place on July 1, 2013, the request for High Impact | ||
Business Building Materials Exemption Certificates from the | ||
High Impact Business to the Department for these pre-existing | ||
construction contractors and other entities must include the | ||
information required under subsection (b), but not including | ||
the information listed in items (3) and (4). For any new | ||
construction contract entered into on or after July 1, 2013, | ||
however, all of the information in subsection (b) must be | ||
provided. | ||
(Source: P.A. 94-793, eff. 5-19-06.)
| ||
Section 20. The River Edge Redevelopment Zone Act is |
amended by changing Section 10-5.3 and by adding Section | ||
10-10.2 as follows: | ||
(65 ILCS 115/10-5.3)
| ||
Sec. 10-5.3. Certification of River Edge Redevelopment | ||
Zones. | ||
(a) Approval of designated River Edge Redevelopment Zones | ||
shall be made by the Department by certification of the | ||
designating ordinance. The Department shall promptly issue a | ||
certificate for each zone upon its approval. The certificate | ||
shall be signed by the Director of the Department, shall make | ||
specific reference to the designating ordinance, which shall be | ||
attached thereto, and shall be filed in the office of the | ||
Secretary of State. A certified copy of the River Edge | ||
Redevelopment Zone Certificate, or a duplicate original | ||
thereof, shall be recorded in the office of the recorder of | ||
deeds of the county in which the River Edge Redevelopment Zone | ||
lies. | ||
(b) A River Edge Redevelopment Zone shall be effective upon | ||
its certification. The Department shall transmit a copy of the | ||
certification to the Department of Revenue, and to the | ||
designating municipality.
Upon certification of a River Edge | ||
Redevelopment Zone, the terms and provisions of the designating | ||
ordinance shall be in effect, and may not be amended or | ||
repealed except in accordance with Section 10-5.4. | ||
(c) A River Edge Redevelopment Zone shall be in effect for |
the period stated in the certificate, which shall in no event | ||
exceed 30 calendar years. Zones shall terminate at midnight of | ||
December 31 of the final calendar year of the certified term, | ||
except as provided in Section 10-5.4. | ||
(d) In calendar years 2006 and 2007, the Department may | ||
certify one pilot River Edge Redevelopment Zone in the City of | ||
East St. Louis, one pilot River Edge Redevelopment Zone in the | ||
City of Rockford, and one pilot River Edge Redevelopment Zone | ||
in the City of Aurora. | ||
In calendar year 2009, the Department may certify one pilot | ||
River Edge Redevelopment Zone in the City of Elgin. | ||
On or after the effective date of this amendatory Act of | ||
the 97th General Assembly, the Department may certify one | ||
additional pilot River Edge Redevelopment Zone in the City of | ||
Peoria. | ||
Thereafter the Department may not certify any additional | ||
River Edge Redevelopment Zones, but may amend and rescind | ||
certifications of existing River Edge Redevelopment Zones in | ||
accordance with Section 10-5.4 , except that no River Edge | ||
Redevelopment Zone may be extended on or after the effective | ||
date of this amendatory Act of the 97th General Assembly. Each | ||
River Edge Redevelopment Zone in existence on the effective | ||
date of this amendatory Act of the 97th General Assembly shall | ||
continue until its scheduled termination under this Act, unless | ||
the Zone is decertified sooner. At the time of its term | ||
expiration each River Edge Redevelopment Zone will become an |
open enterprise zone, available for the previously designated | ||
area or a different area to compete for designation as an | ||
enterprise zone. No preference for designation as a Zone will | ||
be given to the previously designated area . | ||
(e) A municipality in which a River Edge Redevelopment Zone | ||
has been certified must submit to the Department, within 60 | ||
days after the certification, a plan for encouraging the | ||
participation by minority persons, females, persons with | ||
disabilities, and veterans in the zone. The Department may | ||
assist the municipality in developing and implementing the | ||
plan. The terms "minority person", "female", and "person with a | ||
disability" have the meanings set forth under Section 2 of the | ||
Business Enterprise for Minorities, Females, and Persons with | ||
Disabilities Act. "Veteran" means an Illinois resident who is a | ||
veteran as defined in subsection (h) of Section 1491 of Title | ||
10 of the United States Code.
| ||
(Source: P.A. 96-37, eff. 7-13-09; 97-203, eff. 7-28-11.) | ||
(65 ILCS 115/10-10.2 new) | ||
Sec. 10-10.2. Accounting. | ||
(a) Any business receiving tax incentives due to its | ||
location within a River Edge Redevelopment Zone must report the | ||
total tax benefits received by the business, broken down by | ||
incentive category, annually to the Department of Revenue. | ||
Reports will be due no later than March 30 of each year and | ||
shall cover the previous calendar year. The first report will |
be for the 2012 calendar year and will be due no later than | ||
March 30, 2013. Failure to report data shall result in | ||
ineligibility to receive incentives. For the first offense, a | ||
business shall be given 60 days to comply. | ||
(b) Each person required to file a return under the Gas | ||
Revenue Tax Act, the Gas Use Tax Act, the Electricity Excise | ||
Tax Act, or the Telecommunications Excise Tax Act shall file, | ||
on or before March 30 of each year, a report with the | ||
Department of Revenue, in the manner and form required by the | ||
Department of Revenue, itemizing the amount of the deduction | ||
taken under each Act, respectively, due to the location of a | ||
business in a River Edge Redevelopment Zone. The report shall | ||
be itemized by business and the business location address. | ||
(c) Employers shall report their job creation, retention, | ||
and capital investment numbers within the River Edge | ||
Redevelopment Zone annually to the administrator which will | ||
compile the information and report it to the Department of | ||
Revenue no later than March 30 of each calendar year. | ||
(d) The Department of Revenue will aggregate and collect | ||
the tax, job, and capital investment data by River Edge | ||
Redevelopment Zone and report this information, formatted to | ||
exclude company-specific proprietary information, to the | ||
Department by May 1, 2013, and by May 1 of every calendar year | ||
thereafter. The Department will include this information in | ||
their required reports under Section 6 of this Act. | ||
(e) The Department of Revenue, in its discretion, may |
require that the reports filed under this Section be submitted | ||
electronically. | ||
(f) The Department of Revenue shall have the authority to | ||
adopt rules as are reasonable and necessary to implement the | ||
provisions of this Section. | ||
Section 95. No acceleration or delay. Where this Act makes | ||
changes in a statute that is represented in this Act by text | ||
that is not yet or no longer in effect (for example, a Section | ||
represented by multiple versions), the use of that text does | ||
not accelerate or delay the taking effect of (i) the changes | ||
made by this Act or (ii) provisions derived from any other | ||
Public Act.
| ||
Section 99. Effective date. This Act takes effect upon | ||
becoming law.
|