Revenue Committee

Filed: 5/20/2008

 

 


 

 


 
09500SB2015ham001 LRB095 17253 HLH 51069 a

1
AMENDMENT TO SENATE BILL 2015

2     AMENDMENT NO. ______. Amend Senate Bill 2015 by replacing
3 everything after the enacting clause with the following:
 
4     "Section 1. Short title. This Act may be cited as the New
5 Markets Development Program Act.
 
6     Section 5. Definitions. As used in this Act:
7     "Applicable percentage" means 0% for each of the first 2
8 credit allowance dates, 7% for the third credit allowance date,
9 and 8% for the next 4 credit allowance dates.
10     "Credit allowance date" means with respect to any qualified
11 equity investment:
12         (1) the date on which the investment is initially made;
13     and
14         (2) each of the 6 anniversary dates of that date
15     thereafter.
16     "Department" means the Department of Commerce and Economic

 

 

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1 Opportunity.
2     "Long-term debt security" means any debt instrument issued
3 by a qualified community development entity, at par value or a
4 premium, with an original maturity date of at least 7 years
5 from the date of its issuance, with no acceleration of
6 repayment, amortization, or prepayment features prior to its
7 original maturity date. Cumulative cash payments of interest on
8 the qualified debt instrument during the period commencing with
9 the issuance of the qualified debt instrument and ending with
10 the seventh anniversary of its issuance shall not exceed the
11 sum of such cash interest payments and the cumulative net
12 income of the issuing community development entity for the same
13 period. This definition in no way limits the holder's ability
14 to accelerate payments on the debt instrument in situations
15 where the issuer has defaulted on covenants designed to ensure
16 compliance with this Act or Section 45D of the Internal Revenue
17 Code of 1986, as amended.
18     "Purchase price" means the amount paid to the issuer of a
19 qualified equity investment for that qualified equity
20 investment.
21     "Qualified active low-income community business" has the
22 meaning given to that term in Section 45D of the Internal
23 Revenue Code of 1986, as amended; except that any business that
24 derives or projects to derive 15% or more of its annual revenue
25 from the rental or sale of real estate is not considered to be
26 a qualified active low-income community business. This

 

 

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1 exception does not apply to a business that is controlled by or
2 under common control with another business if the second
3 business (i) does not derive or project to derive 15% or more
4 of its annual revenue from the rental or sale of real estate
5 and (ii) is the primary tenant of the real estate leased from
6 the initial business. A business shall be considered a
7 qualified active low-income community business for the
8 duration of the qualified community development entity's
9 investment in or loan to the business if the entity reasonably
10 expects, at the time it makes the investment or loan, that the
11 business will continue to satisfy the requirements for being a
12 qualified active low-income community business throughout the
13 entire period of the investment or loan.
14     "Qualified community development entity" has the meaning
15 given to that term in Section 45D of the Internal Revenue Code
16 of 1986, as amended; provided that such entity has entered
17 into, or is controlled by an entity that has entered into, an
18 allocation agreement with the Community Development Financial
19 Institutions Fund of the U.S. Treasury Department with respect
20 to credits authorized by Section 45D of the Internal Revenue
21 Code of 1986, as amended, that includes the State of Illinois
22 within the service area set forth in that allocation agreement.
23     "Qualified equity investment" means any equity investment
24 in, or long-term debt security issued by, a qualified community
25 development entity that:
26         (1) is acquired after the effective date of this Act at

 

 

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1     its original issuance solely in exchange for cash;
2         (2) has at least 85% of its cash purchase price used by
3     the issuer to make qualified low-income community
4     investments in the State of Illinois; and
5         (3) is designated by the issuer as a qualified equity
6     investment under this Act and is certified by the
7     Department as not exceeding the limitation contained in
8     Section 20.
9     This term includes any qualified equity investment that
10 does not meet the provisions of item (1) of this definition if
11 the investment was a qualified equity investment in the hands
12 of a prior holder.
13     "Qualified low-income community investment" means any
14 capital or equity investment in, or loan to, any qualified
15 active low-income community business. With respect to any one
16 qualified active low-income community business, the maximum
17 amount of qualified low-income community investments made in
18 that business, on a collective basis with all of its affiliates
19 that may be counted towards the satisfaction of paragraph (2)
20 of the definition of qualified equity investment, shall be
21 $10,000,000 whether issued to one or several qualified
22 community development entities.
23     "Tax credit" means a credit against any income, franchise,
24 or insurance premium taxes otherwise due under Illinois law.
25     "Taxpayer" means any individual or entity subject to any
26 income, franchise, or insurance premium tax under Illinois law.
 

 

 

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1     Section 10. Credit established. A person or entity that
2 makes a qualified equity investment earns a vested right to tax
3 credits as follows:
4         (1) on each credit allowance date of the qualified
5     equity investment, the purchaser of the qualified equity
6     investment, or subsequent holder of the qualified equity
7     investment, is entitled to a tax credit during the taxable
8     year including that credit allowance date;
9         (2) the tax credit amount shall be equal to the
10     applicable percentage for such credit allowance date
11     multiplied by the purchase price paid to the issuer of the
12     qualified equity investment; and
13         (3) the amount of the tax credit claimed shall not
14     exceed the amount of the State tax liability of the holder,
15     or the person or entity to whom the credit is allocated for
16     use pursuant to Section 15, for the tax year for which the
17     tax credit is claimed.
18     A company doing insurance business in this State claiming a
19 tax credit against insurance premium taxes payable pursuant to
20 Section 409 of the Illinois Insurance Code is not required to
21 pay any additional retaliatory tax imposed pursuant to Section
22 444 or 444.1 of the Illinois Insurance Code related to that
23 claim for a tax credit.
 
24     Section 15. Transferability. No tax credit claimed under

 

 

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1 this Act shall be refundable or saleable on the open market.
2 Tax credits earned by a partnership, limited liability company,
3 S corporation, or other "pass-through" entity may be allocated
4 to the partners, members, or shareholders of that entity for
5 their direct use in accordance with the provisions of any
6 agreement among the partners, members, or shareholders. Any
7 amount of tax credit that the taxpayer, or partner, member, or
8 shareholder thereof, is prohibited from claiming in a taxable
9 year may be carried forward to any of the taxpayer's 5
10 subsequent taxable years.
 
11     Section 20. Annual cap on credits. The Department shall
12 limit the monetary amount of qualified equity investments
13 permitted under this Act to a level necessary to limit tax
14 credit use at no more than $10,000,000 of tax credits in any
15 fiscal year. This limitation on qualified equity investments
16 shall be based on the anticipated use of credits without regard
17 to the potential for taxpayers to carry forward tax credits to
18 later tax years.
 
19     Section 25. Certification of qualified equity investments.
20     (a) A qualified community development entity that seeks to
21 have an equity investment or long-term debt security designated
22 as a qualified equity investment and eligible for tax credits
23 under this Section shall apply to the Department. The qualified
24 community development entity must submit an application on a

 

 

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1 form that the Department provides that includes:
2         (1) The name, address, tax identification number of the
3     entity, and evidence of the entity's certification as a
4     qualified community development entity.
5         (2) A copy of the allocation agreement executed by the
6     entity, or its controlling entity, and the Community
7     Development Financial Institutions Fund.
8         (3) A certificate executed by an executive officer of
9     the entity attesting that the allocation agreement remains
10     in effect and has not been revoked or cancelled by the
11     Community Development Financial Institutions Fund.
12         (4) A description of the proposed amount, structure,
13     and purchaser of the equity investment or long-term debt
14     security.
15         (5) The name and tax identification number of any
16     taxpayer eligible to utilize tax credits earned as a result
17     of the issuance of the qualified equity investment.
18         (6) Information regarding the proposed use of proceeds
19     from the issuance of the qualified equity investment.
20         (7) A nonrefundable application fee of $5,000. This fee
21     shall be paid to the Department and shall be required of
22     each application submitted.
23     (b) Within 30 days after receipt of a completed application
24 containing the information necessary for the Department to
25 certify a potential qualified equity investment, including the
26 payment of the application fee, the Department shall grant or

 

 

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1 deny the application in full or in part. If the Department
2 denies any part of the application, it shall inform the
3 qualified community development entity of the grounds for the
4 denial. If the qualified community development entity provides
5 any additional information required by the Department or
6 otherwise completes its application within 15 days of the
7 notice of denial, the application shall be considered completed
8 as of the original date of submission. If the qualified
9 community development entity fails to provide the information
10 or complete its application within the 15-day period, the
11 application remains denied and must be resubmitted in full with
12 a new submission date.
13     (c) If the application is deemed complete, the Department
14 shall certify the proposed equity investment or long-term debt
15 security as a qualified equity investment that is eligible for
16 tax credits under this Section, subject to the limitations
17 contained in Section 20. The Department shall provide written
18 notice of the certification to the qualified community
19 development entity. The notice shall include the names of those
20 taxpayers who are eligible to utilize the credits and their
21 respective credit amounts. If the names of the taxpayers who
22 are eligible to utilize the credits change due to a transfer of
23 a qualified equity investment or a change in an allocation
24 pursuant to Section 15, the qualified community development
25 entity shall notify the Department of such change.
26     (d) The Department shall certify qualified equity

 

 

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1 investments in the order applications are received by the
2 Department. Applications received on the same day shall be
3 deemed to have been received simultaneously. For applications
4 received on the same day and deemed complete, the Department
5 shall certify, consistent with remaining tax credit capacity,
6 qualified equity investments in proportionate percentages
7 based upon the ratio of the amount of qualified equity
8 investment requested in an application to the total amount of
9 qualified equity investments requested in all applications
10 received on the same day.
11     (e) Once the Department has certified qualified equity
12 investments that, on a cumulative basis, are eligible for
13 $10,000,000 in tax credits, the Department may not certify any
14 more qualified equity investments. If a pending request cannot
15 be fully certified, the Department shall certify the portion
16 that may be certified unless the qualified community
17 development entity elects to withdraw its request rather than
18 receive partial credit.
19     (f) Within 30 days after receiving notice of certification,
20 the qualified community development entity shall issue the
21 qualified equity investment and receive cash in the amount of
22 the certified amount. The qualified community development
23 entity must provide the Department with evidence of the receipt
24 of the cash investment within 10 business days after receipt.
25 If the qualified community development entity does not receive
26 the cash investment and issue the qualified equity investment

 

 

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1 within 30 days following receipt of the certification notice,
2 the certification shall lapse and the entity may not issue the
3 qualified equity investment without reapplying to the
4 Department for certification. A certification that lapses
5 reverts back to the Department and may be reissued only in
6 accordance with the application process outline in this Section
7 25.
 
8     Section 40. Recapture. The Department shall recapture,
9 from the taxpayer that claimed the credit on a return, the tax
10 credit allowed under this Act if:
11         (1) any amount of the federal tax credit available with
12     respect to a qualified equity investment that is eligible
13     for a tax credit under this Act is recaptured under Section
14     45D of the Internal Revenue Code of 1986, as amended. In
15     that case, the Department's recapture shall be
16     proportionate to the federal recapture with respect to that
17     qualified equity investment;
18         (2) the issuer redeems or makes principal repayment
19     with respect to a qualified equity investment prior to the
20     7th anniversary of the issuance of the qualified equity
21     investment. In that case, the Department's recapture shall
22     be proportionate to the amount of the redemption or
23     repayment with respect to the qualified equity investment;
24     or
25         (3) the issuer fails to invest at least 85% of the cash

 

 

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1     purchase price of the qualified equity investment in
2     qualified low-income community investments in the state of
3     Illinois within 12 months of the issuance of the qualified
4     equity investment and maintain such level of investment in
5     qualified low-income community investments in Illinois
6     until the last credit allowance date for such qualified
7     equity investment.
8     For purposes of this Section, an investment shall be
9 considered held by an issuer even if the investment has been
10 sold or repaid; provided that the issuer reinvests an amount
11 equal to the capital returned to or recovered by the issuer
12 from the original investment, exclusive of any profits
13 realized, in another qualified low-income community investment
14 in this State within 12 months after the receipt of that
15 capital. An issuer is not required to reinvest capital returned
16 from qualified low-income community investments after the 6th
17 anniversary of the issuance of the qualified equity investment,
18 the proceeds of which were used to make the qualified
19 low-income community investment, and the qualified low-income
20 community investment shall be considered held by the issuer
21 through the 7th anniversary of the qualified equity
22 investment's issuance.
23     The Department shall provide notice to the qualified
24 community development entity of any proposed recapture of tax
25 credits pursuant to this Section. The entity shall have 90 days
26 to cure any deficiency indicated in the Department's original

 

 

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1 recapture notice and avoid such recapture. If the entity fails
2 or is unable to cure such deficiency with the 90-day period,
3 the Department shall provide the entity and the taxpayer from
4 whom the credit is to be recaptured with a final order of
5 recapture. Any tax credit for which a final recapture order has
6 been issued shall be recaptured by the Department from the
7 taxpayer who claimed the tax credit on a tax return.
 
8     Section 45. Examination and Rulemaking.
9     (a) The Department may conduct examinations to verify that
10 the tax credits under this Act have been received and applied
11 according to the requirements of this Act and to verify that no
12 event has occurred that would result in a recapture of tax
13 credits under Section 40.
14     (b) Neither the Department nor the Department of Revenue
15 shall have the authority to promulgate rules under the Act, but
16 the Department and the Department of Revenue shall have the
17 authority to issue advisory letters to individual qualified
18 community development entities and their investors that are
19 limited to the specific facts outlined in an advisory letter
20 request from a qualified community development entity. Such
21 rulings cannot be relied upon by any person or entity other
22 than the qualified community development entity that requested
23 the letter and the taxpayers that are entitled to any tax
24 credits generated from investments in such entity. In rendering
25 such advisory letters and making other determinations under

 

 

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1 this Act, to the extent applicable, the Department and the
2 Department of Revenue shall look for guidance to Section 45D of
3 the Internal Revenue Code of 1986, as amended, and the rules
4 and regulations issued thereunder.
 
5     Section 50. Sunset. For fiscal years following fiscal year
6 2012, qualified equity investments shall not be made under this
7 Act unless reauthorization is made pursuant to this Section.
8 For all fiscal years following fiscal year 2012, unless the
9 General Assembly adopts a joint resolution granting authority
10 to the Department to approve qualified equity investments for
11 the Illinois new markets development program and clearly
12 describing the amount of tax credits available for the next
13 fiscal year, or otherwise complies with the provisions of this
14 Section, no qualified equity investments may be permitted to be
15 made under this Act. The amount of available tax credits
16 contained in such a resolution shall not exceed the limitation
17 provided under Section 20. Nothing in this Section precludes a
18 taxpayer who makes a qualified equity investment prior to the
19 expiration of authority to make qualified equity investments
20 from claiming tax credits relating to that qualified equity
21 investment for each applicable credit allowance date.
 
22     Section 75. The Illinois Insurance Code is amended by
23 changing Sections 409, 444, and 444.1 as follows:
 

 

 

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1     (215 ILCS 5/409)  (from Ch. 73, par. 1021)
2     Sec. 409. Annual privilege tax payable by companies.
3     (1) As of January 1, 1999 for all health maintenance
4 organization premiums written; as of July 1, 1998 for all
5 premiums written as accident and health business, voluntary
6 health service plan business, dental service plan business, or
7 limited health service organization business; and as of January
8 1, 1998 for all other types of insurance premiums written,
9 every company doing any form of insurance business in this
10 State, including, but not limited to, every risk retention
11 group, and excluding all fraternal benefit societies, all farm
12 mutual companies, all religious charitable risk pooling
13 trusts, and excluding all statutory residual market and special
14 purpose entities in which companies are statutorily required to
15 participate, whether incorporated or otherwise, shall pay, for
16 the privilege of doing business in this State, to the Director
17 for the State treasury a State tax equal to 0.5% of the net
18 taxable premium written, together with any amounts due under
19 Section 444 of this Code, except that the tax to be paid on any
20 premium derived from any accident and health insurance or on
21 any insurance business written by any company operating as a
22 health maintenance organization, voluntary health service
23 plan, dental service plan, or limited health service
24 organization shall be equal to 0.4% of such net taxable premium
25 written, together with any amounts due under Section 444. Upon
26 the failure of any company to pay any such tax due, the

 

 

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1 Director may, by order, revoke or suspend the company's
2 certificate of authority after giving 20 days written notice to
3 the company, or commence proceedings for the suspension of
4 business in this State under the procedures set forth by
5 Section 401.1 of this Code. The gross taxable premium written
6 shall be the gross amount of premiums received on direct
7 business during the calendar year on contracts covering risks
8 in this State, except premiums on annuities, premiums on which
9 State premium taxes are prohibited by federal law, premiums
10 paid by the State for health care coverage for Medicaid
11 eligible insureds as described in Section 5-2 of the Illinois
12 Public Aid Code, premiums paid for health care services
13 included as an element of tuition charges at any university or
14 college owned and operated by the State of Illinois, premiums
15 on group insurance contracts under the State Employees Group
16 Insurance Act of 1971, and except premiums for deferred
17 compensation plans for employees of the State, units of local
18 government, or school districts. The net taxable premium shall
19 be the gross taxable premium written reduced only by the
20 following:
21         (a) the amount of premiums returned thereon which shall
22     be limited to premiums returned during the same preceding
23     calendar year and shall not include the return of cash
24     surrender values or death benefits on life policies
25     including annuities;
26         (b) dividends on such direct business that have been

 

 

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1     paid in cash, applied in reduction of premiums or left to
2     accumulate to the credit of policyholders or annuitants. In
3     the case of life insurance, no deduction shall be made for
4     the payment of deferred dividends paid in cash to
5     policyholders on maturing policies; dividends left to
6     accumulate to the credit of policyholders or annuitants
7     shall be included as gross taxable premium written when
8     such dividend accumulations are applied to purchase
9     paid-up insurance or to shorten the endowment or premium
10     paying period.
11     (2) The annual privilege tax payment due from a company
12 under subsection (4) of this Section may be reduced by: (a) the
13 excess amount, if any, by which the aggregate income taxes paid
14 by the company, on a cash basis, for the preceding calendar
15 year under subsections (a) through (d) of Section 201 of the
16 Illinois Income Tax Act exceed 1.5% of the company's net
17 taxable premium written for that prior calendar year, as
18 determined under subsection (1) of this Section; and (b) the
19 amount of any fire department taxes paid by the company during
20 the preceding calendar year under Section 11-10-1 of the
21 Illinois Municipal Code. Any deductible amount or offset
22 allowed under items (a) and (b) of this subsection for any
23 calendar year will not be allowed as a deduction or offset
24 against the company's privilege tax liability for any other
25 taxing period or calendar year.
26     (3) If a company survives or was formed by a merger,

 

 

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1 consolidation, reorganization, or reincorporation, the
2 premiums received and amounts returned or paid by all companies
3 party to the merger, consolidation, reorganization, or
4 reincorporation shall, for purposes of determining the amount
5 of the tax imposed by this Section, be regarded as received,
6 returned, or paid by the surviving or new company.
7     (4)(a) All companies subject to the provisions of this
8 Section shall make an annual return for the preceding calendar
9 year on or before March 15 setting forth such information on
10 such forms as the Director may reasonably require. Payments of
11 quarterly installments of the taxpayer's total estimated tax
12 for the current calendar year shall be due on or before April
13 15, June 15, September 15, and December 15 of such year, except
14 that all companies transacting insurance in this State whose
15 annual tax for the immediately preceding calendar year was less
16 than $5,000 shall make only an annual return. Failure of a
17 company to make the annual payment, or to make the quarterly
18 payments, if required, of at least 25% of either (i) the total
19 tax paid during the previous calendar year or (ii) 80% of the
20 actual tax for the current calendar year shall subject it to
21 the penalty provisions set forth in Section 412 of this Code.
22     (b) Notwithstanding the foregoing provisions, no annual
23 return shall be required or made on March 15, 1998, under this
24 subsection. For the calendar year 1998:
25         (i) each health maintenance organization shall have no
26     estimated tax installments;

 

 

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1         (ii) all companies subject to the tax as of July 1,
2     1998 as set forth in subsection (1) shall have estimated
3     tax installments due on September 15 and December 15 of
4     1998 which installments shall each amount to no less than
5     one-half of 80% of the actual tax on its net taxable
6     premium written during the period July 1, 1998, through
7     December 31, 1998; and
8         (iii) all other companies shall have estimated tax
9     installments due on June 15, September 15, and December 15
10     of 1998 which installments shall each amount to no less
11     than one-third of 80% of the actual tax on its net taxable
12     premium written during the calendar year 1998.
13     In the year 1999 and thereafter all companies shall make
14 annual and quarterly installments of their estimated tax as
15 provided by paragraph (a) of this subsection.
16     (5) In addition to the authority specifically granted under
17 Article XXV of this Code, the Director shall have such
18 authority to adopt rules and establish forms as may be
19 reasonably necessary for purposes of determining the
20 allocation of Illinois corporate income taxes paid under
21 subsections (a) through (d) of Section 201 of the Illinois
22 Income Tax Act amongst members of a business group that files
23 an Illinois corporate income tax return on a unitary basis, for
24 purposes of regulating the amendment of tax returns, for
25 purposes of defining terms, and for purposes of enforcing the
26 provisions of Article XXV of this Code. The Director shall also

 

 

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1 have authority to defer, waive, or abate the tax imposed by
2 this Section if in his opinion the company's solvency and
3 ability to meet its insured obligations would be immediately
4 threatened by payment of the tax due.
5     (c) This Section is subject to the provisions of Section 10
6 of the New Markets Development Program Act.
7 (Source: P.A. 90-583, eff. 5-29-98.)
 
8     (215 ILCS 5/444)  (from Ch. 73, par. 1056)
9     Sec. 444. Retaliation.
10     (1) Whenever the existing or future laws of any other state
11 or country shall require of companies incorporated or organized
12 under the laws of this State as a condition precedent to their
13 doing business in such other state or country, compliance with
14 laws, rules, regulations, and prohibitions more onerous or
15 burdensome than the rules and regulations imposed by this State
16 on foreign or alien companies, or shall require any deposit of
17 securities or other obligations in such state or country, for
18 the protection of policyholders or otherwise or require of such
19 companies or agents thereof or brokers the payment of
20 penalties, fees, charges, or taxes greater than the penalties,
21 fees, charges, or taxes required in the aggregate for like
22 purposes by this Code or any other law of this State, of
23 foreign or alien companies, agents thereof or brokers, then
24 such laws, rules, regulations, and prohibitions of said other
25 state or country shall apply to companies incorporated or

 

 

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1 organized under the laws of such state or country doing
2 business in this State, and all such companies, agents thereof,
3 or brokers doing business in this State, shall be required to
4 make deposits, pay penalties, fees, charges, and taxes, in
5 amounts equal to those required in the aggregate for like
6 purposes of Illinois companies doing business in such state or
7 country, agents thereof or brokers. Whenever any other state or
8 country shall refuse to permit any insurance company
9 incorporated or organized under the laws of this State to
10 transact business according to its usual plan in such other
11 state or country, the director may, if satisfied that such
12 company of this State is solvent, properly managed, and can
13 operate legally under the laws of such other state or country,
14 forthwith suspend or cancel the license of every insurance
15 company doing business in this State which is incorporated or
16 organized under the laws of such other state or country to the
17 extent that it insures in this State against any of the risks
18 or hazards which are sought to be insured against by the
19 company of this State in such other state or country.
20     (2) The provisions of this Section shall not apply to
21 residual market or special purpose assessments or guaranty fund
22 or guaranty association assessments, both under the laws of
23 this State and under the laws of any other state or country,
24 and any tax offset or credit for any such assessment shall, for
25 purposes of this Section, be treated as a tax paid both under
26 the laws of this State and under the laws of any other state or

 

 

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1 country.
2     (3) The terms "penalties", "fees", "charges", and "taxes"
3 in subsection (1) of this Section shall include: the penalties,
4 fees, charges, and taxes collected under State law and
5 referenced within Article XXV exclusive of any items referenced
6 by subsection (2) of this Section, but including any tax offset
7 allowed under Section 531.13 of this Code; the Illinois
8 corporate income taxes imposed under subsections (a) through
9 (d) of Section 201 of the Illinois Income Tax Act after any tax
10 offset allowed under Section 531.13 of this Code; income or
11 personal property taxes imposed by other states or countries;
12 penalties, fees, charges, and taxes of other states or
13 countries imposed for purposes like those of the penalties,
14 fees, charges, and taxes specified in Article XXV of this Code
15 exclusive of any item referenced in subsection (2) of this
16 Section; and any penalties, fees, charges, and taxes required
17 as a franchise, privilege, or licensing tax for conducting the
18 business of insurance whether calculated as a percentage of
19 income, gross receipts, premium, or otherwise.
20     (4) Nothing contained in this Section or Section 409 or
21 Section 444.1 is intended to authorize or expand any power of
22 local governmental units or municipalities to impose taxes,
23 fees, or charges.
24     (5) This Section is subject to the provisions of Section 10
25 of the New Markets Development Program Act.
26 (Source: P.A. 90-583, eff. 5-29-98.)
 

 

 

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1     (215 ILCS 5/444.1)  (from Ch. 73, par. 1056.1)
2     Sec. 444.1. Payment of retaliatory taxes.
3     (1) Every foreign or alien company doing insurance business
4 in this State shall pay the Director the retaliatory tax
5 determined in accordance with Section 444.
6     (2) (a) All companies subject to the provisions of this
7 Section shall make an annual return for the preceding calendar
8 year on or before March 15 setting forth such information on
9 such forms as the Director may reasonably require. Payments of
10 quarterly installments of the taxpayer's total estimated
11 retaliatory tax for the current calendar year shall be due on
12 or before April 15, June 15, September 15, and December 15 of
13 such year, except that all companies transacting insurance
14 business in this State whose annual tax for the immediately
15 preceding calendar year was less than $5,000 shall make only an
16 annual return. Failure of a company to make the annual payment,
17 or to make the quarterly payments, if required, of at least
18 one-fourth of either (i) the total tax paid during the previous
19 calendar year or (ii) 80% of the actual tax for the current
20 calendar year shall subject it to the penalty provisions set
21 forth in Section 412 of this Code.
22     (b) Notwithstanding the foregoing provisions of paragraph
23 (a) of this subsection, the retaliatory tax liability of
24 companies under Section 444 of this Code for the calendar year
25 ended December 31, 1997 shall be determined in accordance with

 

 

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1 this amendatory Act of 1998 and shall include in the aggregate
2 comparative tax burden for the State of Illinois, any tax
3 offset allowed under Section 531.13 of this Code and any income
4 taxes paid for the year 1997 under subsections (a) through (d)
5 of Section 201 of the Illinois Income Tax Act after any tax
6 offset allowed under Section 531.13 of this Code.
7         (i) Any annual retaliatory tax returns and payments
8     made for the year ended December 31, 1997 and any quarterly
9     installments of the taxpayer's total estimated 1998
10     retaliatory tax liability paid prior to the effective date
11     of this Amendatory Act of 1998 that do not include the
12     items specified by subsection (1) of this Section shall be
13     amended and restated, at the taxpayer's election, on forms
14     prepared by the Director so as to provide for the inclusion
15     of such items. An amended and restated return for the year
16     ended December 31, 1997 filed under this subparagraph shall
17     treat any payment of estimated privilege taxes under
18     Section 409 as in effect prior to October 23, 1997 as a
19     payment of estimated retaliatory taxes for the year ended
20     December 31, 1997.
21         (ii) Any overpayment resulting from such amended
22     return and restated tax liability shall be allowed as a
23     credit against any subsequent privilege or retaliatory tax
24     obligations of the taxpayer.
25         (iii) In the year 1999 and thereafter all companies
26     shall make annual and quarterly installments of their

 

 

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1     estimated tax as provided by paragraph (a) of this
2     subsection.
3     (3) Any tax payment made under this Section and any tax
4 returns prepared in compliance with Section 410 shall give full
5 consideration to the impact of any future reduction in or
6 elimination of a taxpayer's liability under Section 409,
7 whether such reduction or elimination is due to an operation of
8 law or an Act of the General Assembly.
9     (4) Any foreign or alien taxpayer who makes, under protest,
10 a tax payment required by Section 409 shall, at the time of
11 payment, file a retaliatory tax return sufficient to disclose
12 the full amount of retaliatory taxes which would be due and
13 owing for the tax period in question if the protest were
14 upheld. Notwithstanding the provisions of the State Officers
15 and Employees Money Disposition Act or any other laws of this
16 State, the protested payment, to the extent of the retaliatory
17 tax so disclosed, shall be deposited directly in the General
18 Revenue Fund; and the balance of the payment, if any, shall be
19 deposited in a protest account pursuant to the provisions of
20 the aforesaid Act, as now or hereafter amended.
21     (5) The failure of a company to make the annual payment or
22 to make the quarterly payments, if required, of at least
23 one-fourth of either (i) the total tax paid during the
24 preceding calendar year or (ii) 80% of the actual tax for the
25 current calendar year shall subject it to the penalty
26 provisions set forth in Section 412 of this Code.

 

 

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1     (6) This Section is subject to the provisions of Section 10
2 of the New Markets Development Program Act.
3 (Source: P.A. 90-583, eff. 5-29-98.)
 
4     Section 99. Effective date. This Act takes effect upon
5 becoming law.".