Section 532.110  Transfer of Theater Tax Credit Award

a)         A sale, assignment, or transfer of the credit may be made by the taxpayer earning the credit within one year after the credit is awarded in accordance with this Part. [35 ILCS 5/222(c)]

b)         For purposes of this Section, a tax credit is earned on the date that the theater tax credit award is issued under Section 532.80.

c)         For purposes of this Section, a tax credit earned by a partnership, limited liability company or Subchapter S corporation, the tax credit is allowed to the partners, unit holders, or shareholders in accordance with the determination of income and distributive share of income under sections 702 and 704 and subchapter S of the Internal Revenue Code. [35 ILCS 5/222(b)]

d)         The tax credit award may not be carried back. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 years following the excess credit year. The tax credit award 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 liability, the earlier credit shall be applied first.  In no event may a credit under this Section reduce the taxpayer's liability to less than zero. [35 ILCS 5/222(e)]

e)         Transfer of a theater tax credit award shall be made as follows:

1)         The applicant earning the credit shall request the transfer from the Department, in writing, identifying the transferees (name, tax identification number, mailing address) and the amount to be transferred, and the applicant shall return the theater tax credit award to the Department, together with its transfer request.

2)         A request for transfer may be submitted with the applicant's request for the theater tax credit award under Section 532.80, in which case the Department may issue the requested certificates of transfer in lieu of the tax credit award.

3)         If the transfer request is timely and meets the requirements of this Section, the Department shall issue a certificate of transfer, identifying the original theater tax credit award and stating the amount of the credit transferred.

4)         If the applicant earning the credit transfers less than the full amount of the credit, the Department shall issue a certificate of transfer to the applicant identifying the original theater tax credit award and stating the amount of tax credit retained by the applicant.

5)         If the person transferring the credit is a partner or shareholder in a partnership or Subchapter S corporation that earned the credit, that person shall submit to the Department, in lieu of the original theater tax credit award, copies of the tax credit awards and copies of the Schedule K-1-P received by that person from the partnership or Subchapter S corporation stating that person's share of the credit.