Illinois General Assembly - Full Text of HB3419

LRB104 11395 HLH 21483 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB3419

Introduced 2/18/2025, by Rep. Elizabeth "Lisa" Hernandez

SYNOPSIS AS INTRODUCED:

35 ILCS 5/246 new

Amends the Illinois Income Tax Act. Creates an income tax credit for each taxpayer that manufactures renewable diesel in Illinois for use by a rail carrier. Provides that the amount of the credit is $1 per gallon of renewable diesel that is manufactured by the taxpayer in the State for use by a rail carrier. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

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

Section 5. The Illinois Income Tax Act is amended by adding Section 246 as follows:

(35 ILCS 5/246 new)

Sec. 246. Rail carrier renewable diesel tax credit.

(a) For taxable years beginning on or after January 1, 2027, each taxpayer that manufactures renewable diesel in Illinois for use by a rail carrier is eligible for a credit against the tax imposed by subsections (a) and (b) of Section 201 as provided in this Section.

The amount of the credit shall be $1 per gallon, or fraction of a gallon, of renewable diesel that is manufactured by the taxpayer in the State for use by a rail carrier.

(b) To qualify for the credit under this Section, the taxpayer must retain in its books and records:

(1) records indicating the number of whole gallons of renewable diesel manufactured by the taxpayer in Illinois for use by a rail carrier; and

(2) a verification that the renewable diesel blended by the taxpayer meets the definition of renewable diesel set forth in this Section.

The documentation must include detail sufficient for the Department to determine the number of gallons of renewable diesel manufactured in the State for use by rail carriers, as well as any other information reasonably required by the Department.

All documentation must be submitted to the Department in the form and manner required by the Department and by the date required by the Department.

(c) If the amount of the credit exceeds the taxpayer's tax liability for the taxable year, the excess may be carried forward and applied to the tax liability of the 10 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one tax year that are available to offset a liability, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer's liability to less than zero.

(d) This Section is exempt from the provisions of Section 250.

(e) As used in this Section:

"Renewable diesel" means diesel fuel that is a hydrocarbon fuel derived from biomass and that meets the requirements of the latest version of ASTM standards D975 or D396.

"Rail carrier" means a Class I railroad, a Class II railroad, or a Class III railroad, as defined in paragraph (1) of 49 U.S.C. 20102.

Section 99. Effective date. This Act takes effect upon becoming law.