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1 | AN ACT concerning revenue.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
| ||||||
4 | Section 5. The Department of Revenue Law of the
Civil | ||||||
5 | Administrative Code of Illinois is amended by changing Section | ||||||
6 | 2505-200 as follows:
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7 | (20 ILCS 2505/2505-200) (was 20 ILCS 2505/39c-1a)
| ||||||
8 | Sec. 2505-200. Electronic filing rules. | ||||||
9 | (a) The Department may adopt
rules to authorize the | ||||||
10 | electronic filing of any return or document required to
be | ||||||
11 | filed under any Act administered by the Department. | ||||||
12 | (b) The Department may adopt rules to require the | ||||||
13 | electronic filing of the income and replacement tax return | ||||||
14 | required to be filed under the Illinois Income Tax Act for a | ||||||
15 | taxable year by any taxpayer (other than an individual) who is | ||||||
16 | required to file its federal income tax return electronically | ||||||
17 | for the taxable year. | ||||||
18 | (c)
In the case of an electronically filed return or other | ||||||
19 | document required to
be filed with the Department or maintained | ||||||
20 | by any taxpayer, these rules may set
forth standards that | ||||||
21 | provide for acceptance of a signature in a form other than
in | ||||||
22 | the proper handwriting of the person.
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23 | (Source: P.A. 91-239, eff. 1-1-00.)
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1 | Section 10. The Illinois Income Tax Act is amended by | ||||||
2 | changing Sections 203, 502, 911.1, and 911.2 as follows:
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3 | (35 ILCS 5/203) (from Ch. 120, par. 2-203)
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4 | Sec. 203. Base income defined.
| ||||||
5 | (a) Individuals.
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6 | (1) In general. In the case of an individual, base | ||||||
7 | income means an
amount equal to the taxpayer's adjusted | ||||||
8 | gross income for the taxable
year as modified by paragraph | ||||||
9 | (2).
| ||||||
10 | (2) Modifications. The adjusted gross income referred | ||||||
11 | to in
paragraph (1) shall be modified by adding thereto the | ||||||
12 | sum of the
following amounts:
| ||||||
13 | (A) An amount equal to all amounts paid or accrued | ||||||
14 | to the taxpayer
as interest or dividends during the | ||||||
15 | taxable year to the extent excluded
from gross income | ||||||
16 | in the computation of adjusted gross income, except | ||||||
17 | stock
dividends of qualified public utilities | ||||||
18 | described in Section 305(e) of the
Internal Revenue | ||||||
19 | Code;
| ||||||
20 | (B) An amount equal to the amount of tax imposed by | ||||||
21 | this Act to the
extent deducted from gross income in | ||||||
22 | the computation of adjusted gross
income for the | ||||||
23 | taxable year;
| ||||||
24 | (C) An amount equal to the amount received during |
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| |||||||
1 | the taxable year
as a recovery or refund of real | ||||||
2 | property taxes paid with respect to the
taxpayer's | ||||||
3 | principal residence under the Revenue Act of
1939 and | ||||||
4 | for which a deduction was previously taken under | ||||||
5 | subparagraph (L) of
this paragraph (2) prior to July 1, | ||||||
6 | 1991, the retrospective application date of
Article 4 | ||||||
7 | of Public Act 87-17. In the case of multi-unit or | ||||||
8 | multi-use
structures and farm dwellings, the taxes on | ||||||
9 | the taxpayer's principal residence
shall be that | ||||||
10 | portion of the total taxes for the entire property | ||||||
11 | which is
attributable to such principal residence;
| ||||||
12 | (D) An amount equal to the amount of the capital | ||||||
13 | gain deduction
allowable under the Internal Revenue | ||||||
14 | Code, to the extent deducted from gross
income in the | ||||||
15 | computation of adjusted gross income;
| ||||||
16 | (D-5) An amount, to the extent not included in | ||||||
17 | adjusted gross income,
equal to the amount of money | ||||||
18 | withdrawn by the taxpayer in the taxable year from
a | ||||||
19 | medical care savings account and the interest earned on | ||||||
20 | the account in the
taxable year of a withdrawal | ||||||
21 | pursuant to subsection (b) of Section 20 of the
Medical | ||||||
22 | Care Savings Account Act or subsection (b) of Section | ||||||
23 | 20 of the
Medical Care Savings Account Act of 2000;
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24 | (D-10) For taxable years ending after December 31, | ||||||
25 | 1997, an
amount equal to any eligible remediation costs | ||||||
26 | that the individual
deducted in computing adjusted |
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| |||||||
1 | gross income and for which the
individual claims a | ||||||
2 | credit under subsection (l) of Section 201;
| ||||||
3 | (D-15) For taxable years 2001 and thereafter, an | ||||||
4 | amount equal to the
bonus depreciation deduction taken | ||||||
5 | on the taxpayer's federal income tax return for the | ||||||
6 | taxable
year under subsection (k) of Section 168 of the | ||||||
7 | Internal Revenue Code;
| ||||||
8 | (D-16) If the taxpayer sells, transfers, abandons, | ||||||
9 | or otherwise disposes of property for which the | ||||||
10 | taxpayer was required in any taxable year to
make an | ||||||
11 | addition modification under subparagraph (D-15), then | ||||||
12 | an amount equal
to the aggregate amount of the | ||||||
13 | deductions taken in all taxable
years under | ||||||
14 | subparagraph (Z) with respect to that property.
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15 | If the taxpayer continues to own property through | ||||||
16 | the last day of the last tax year for which the | ||||||
17 | taxpayer may claim a depreciation deduction for | ||||||
18 | federal income tax purposes and for which the taxpayer | ||||||
19 | was allowed in any taxable year to make a subtraction | ||||||
20 | modification under subparagraph (Z), then an amount | ||||||
21 | equal to that subtraction modification.
| ||||||
22 | The taxpayer is required to make the addition | ||||||
23 | modification under this
subparagraph
only once with | ||||||
24 | respect to any one piece of property;
| ||||||
25 | (D-17) An amount equal to the amount otherwise | ||||||
26 | allowed as a deduction in computing base income for |
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1 | interest paid, accrued, or incurred, directly or | ||||||
2 | indirectly, (i) for taxable years ending on or after | ||||||
3 | December 31, 2004, to a foreign person who would be a | ||||||
4 | member of the same unitary business group but for the | ||||||
5 | fact that foreign person's business activity outside | ||||||
6 | the United States is 80% or more of the foreign | ||||||
7 | person's total business activity and (ii) for taxable | ||||||
8 | years ending on or after December 31, 2008, to a person | ||||||
9 | who would be a member of the same unitary business | ||||||
10 | group but for the fact that the person is prohibited | ||||||
11 | under Section 1501(a)(27) from being included in the | ||||||
12 | unitary business group because he or she is ordinarily | ||||||
13 | required to apportion business income under different | ||||||
14 | subsections of Section 304. The addition modification | ||||||
15 | required by this subparagraph shall be reduced to the | ||||||
16 | extent that dividends were included in base income of | ||||||
17 | the unitary group for the same taxable year and | ||||||
18 | received by the taxpayer or by a member of the | ||||||
19 | taxpayer's unitary business group (including amounts | ||||||
20 | included in gross income under Sections 951 through 964 | ||||||
21 | of the Internal Revenue Code and amounts included in | ||||||
22 | gross income under Section 78 of the Internal Revenue | ||||||
23 | Code) with respect to the stock of the same person to | ||||||
24 | whom the interest was paid, accrued, or incurred. | ||||||
25 | This paragraph shall not apply to the following:
| ||||||
26 | (i) an item of interest paid, accrued, or |
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1 | incurred, directly or indirectly, to a person who | ||||||
2 | is subject in a foreign country or state, other | ||||||
3 | than a state which requires mandatory unitary | ||||||
4 | reporting, to a tax on or measured by net income | ||||||
5 | with respect to such interest; or | ||||||
6 | (ii) an item of interest paid, accrued, or | ||||||
7 | incurred, directly or indirectly, to a person if | ||||||
8 | the taxpayer can establish, based on a | ||||||
9 | preponderance of the evidence, both of the | ||||||
10 | following: | ||||||
11 | (a) the person, during the same taxable | ||||||
12 | year, paid, accrued, or incurred, the interest | ||||||
13 | to a person that is not a related member, and | ||||||
14 | (b) the transaction giving rise to the | ||||||
15 | interest expense between the taxpayer and the | ||||||
16 | person did not have as a principal purpose the | ||||||
17 | avoidance of Illinois income tax, and is paid | ||||||
18 | pursuant to a contract or agreement that | ||||||
19 | reflects an arm's-length interest rate and | ||||||
20 | terms; or
| ||||||
21 | (iii) the taxpayer can establish, based on | ||||||
22 | clear and convincing evidence, that the interest | ||||||
23 | paid, accrued, or incurred relates to a contract or | ||||||
24 | agreement entered into at arm's-length rates and | ||||||
25 | terms and the principal purpose for the payment is | ||||||
26 | not federal or Illinois tax avoidance; or
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1 | (iv) an item of interest paid, accrued, or | ||||||
2 | incurred, directly or indirectly, to a person if | ||||||
3 | the taxpayer establishes by clear and convincing | ||||||
4 | evidence that the adjustments are unreasonable; or | ||||||
5 | if the taxpayer and the Director agree in writing | ||||||
6 | to the application or use of an alternative method | ||||||
7 | of apportionment under Section 304(f).
| ||||||
8 | Nothing in this subsection shall preclude the | ||||||
9 | Director from making any other adjustment | ||||||
10 | otherwise allowed under Section 404 of this Act for | ||||||
11 | any tax year beginning after the effective date of | ||||||
12 | this amendment provided such adjustment is made | ||||||
13 | pursuant to regulation adopted by the Department | ||||||
14 | and such regulations provide methods and standards | ||||||
15 | by which the Department will utilize its authority | ||||||
16 | under Section 404 of this Act;
| ||||||
17 | (D-18) An amount equal to the amount of intangible | ||||||
18 | expenses and costs otherwise allowed as a deduction in | ||||||
19 | computing base income, and that were paid, accrued, or | ||||||
20 | incurred, directly or indirectly, (i) for taxable | ||||||
21 | years ending on or after December 31, 2004, to a | ||||||
22 | foreign person who would be a member of the same | ||||||
23 | unitary business group but for the fact that the | ||||||
24 | foreign person's business activity outside the United | ||||||
25 | States is 80% or more of that person's total business | ||||||
26 | activity and (ii) for taxable years ending on or after |
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| |||||||
1 | December 31, 2008, to a person who would be a member of | ||||||
2 | the same unitary business group but for the fact that | ||||||
3 | the person is prohibited under Section 1501(a)(27) | ||||||
4 | from being included in the unitary business group | ||||||
5 | because he or she is ordinarily required to apportion | ||||||
6 | business income under different subsections of Section | ||||||
7 | 304. The addition modification required by this | ||||||
8 | subparagraph shall be reduced to the extent that | ||||||
9 | dividends were included in base income of the unitary | ||||||
10 | group for the same taxable year and received by the | ||||||
11 | taxpayer or by a member of the taxpayer's unitary | ||||||
12 | business group (including amounts included in gross | ||||||
13 | income under Sections 951 through 964 of the Internal | ||||||
14 | Revenue Code and amounts included in gross income under | ||||||
15 | Section 78 of the Internal Revenue Code) with respect | ||||||
16 | to the stock of the same person to whom the intangible | ||||||
17 | expenses and costs were directly or indirectly paid, | ||||||
18 | incurred, or accrued. The preceding sentence does not | ||||||
19 | apply to the extent that the same dividends caused a | ||||||
20 | reduction to the addition modification required under | ||||||
21 | Section 203(a)(2)(D-17) of this Act. As used in this | ||||||
22 | subparagraph, the term "intangible expenses and costs" | ||||||
23 | includes (1) expenses, losses, and costs for, or | ||||||
24 | related to, the direct or indirect acquisition, use, | ||||||
25 | maintenance or management, ownership, sale, exchange, | ||||||
26 | or any other disposition of intangible property; (2) |
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| |||||||
1 | losses incurred, directly or indirectly, from | ||||||
2 | factoring transactions or discounting transactions; | ||||||
3 | (3) royalty, patent, technical, and copyright fees; | ||||||
4 | (4) licensing fees; and (5) other similar expenses and | ||||||
5 | costs.
For purposes of this subparagraph, "intangible | ||||||
6 | property" includes patents, patent applications, trade | ||||||
7 | names, trademarks, service marks, copyrights, mask | ||||||
8 | works, trade secrets, and similar types of intangible | ||||||
9 | assets. | ||||||
10 | This paragraph shall not apply to the following: | ||||||
11 | (i) any item of intangible expenses or costs | ||||||
12 | paid, accrued, or incurred, directly or | ||||||
13 | indirectly, from a transaction with a person who is | ||||||
14 | subject in a foreign country or state, other than a | ||||||
15 | state which requires mandatory unitary reporting, | ||||||
16 | to a tax on or measured by net income with respect | ||||||
17 | to such item; or | ||||||
18 | (ii) any item of intangible expense or cost | ||||||
19 | paid, accrued, or incurred, directly or | ||||||
20 | indirectly, if the taxpayer can establish, based | ||||||
21 | on a preponderance of the evidence, both of the | ||||||
22 | following: | ||||||
23 | (a) the person during the same taxable | ||||||
24 | year paid, accrued, or incurred, the | ||||||
25 | intangible expense or cost to a person that is | ||||||
26 | not a related member, and |
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| |||||||
1 | (b) the transaction giving rise to the | ||||||
2 | intangible expense or cost between the | ||||||
3 | taxpayer and the person did not have as a | ||||||
4 | principal purpose the avoidance of Illinois | ||||||
5 | income tax, and is paid pursuant to a contract | ||||||
6 | or agreement that reflects arm's-length terms; | ||||||
7 | or | ||||||
8 | (iii) any item of intangible expense or cost | ||||||
9 | paid, accrued, or incurred, directly or | ||||||
10 | indirectly, from a transaction with a person if the | ||||||
11 | taxpayer establishes by clear and convincing | ||||||
12 | evidence, that the adjustments are unreasonable; | ||||||
13 | or if the taxpayer and the Director agree in | ||||||
14 | writing to the application or use of an alternative | ||||||
15 | method of apportionment under Section 304(f);
| ||||||
16 | Nothing in this subsection shall preclude the | ||||||
17 | Director from making any other adjustment | ||||||
18 | otherwise allowed under Section 404 of this Act for | ||||||
19 | any tax year beginning after the effective date of | ||||||
20 | this amendment provided such adjustment is made | ||||||
21 | pursuant to regulation adopted by the Department | ||||||
22 | and such regulations provide methods and standards | ||||||
23 | by which the Department will utilize its authority | ||||||
24 | under Section 404 of this Act;
| ||||||
25 | (D-19) For taxable years ending on or after | ||||||
26 | December 31, 2008, an amount equal to the amount of |
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| |||||||
1 | insurance premium expenses and costs otherwise allowed | ||||||
2 | as a deduction in computing base income, and that were | ||||||
3 | paid, accrued, or incurred, directly or indirectly, to | ||||||
4 | a person who would be a member of the same unitary | ||||||
5 | business group but for the fact that the person is | ||||||
6 | prohibited under Section 1501(a)(27) from being | ||||||
7 | included in the unitary business group because he or | ||||||
8 | she is ordinarily required to apportion business | ||||||
9 | income under different subsections of Section 304. The | ||||||
10 | addition modification required by this subparagraph | ||||||
11 | shall be reduced to the extent that dividends were | ||||||
12 | included in base income of the unitary group for the | ||||||
13 | same taxable year and received by the taxpayer or by a | ||||||
14 | member of the taxpayer's unitary business group | ||||||
15 | (including amounts included in gross income under | ||||||
16 | Sections 951 through 964 of the Internal Revenue Code | ||||||
17 | and amounts included in gross income under Section 78 | ||||||
18 | of the Internal Revenue Code) with respect to the stock | ||||||
19 | of the same person to whom the premiums and costs were | ||||||
20 | directly or indirectly paid, incurred, or accrued. The | ||||||
21 | preceding sentence does not apply to the extent that | ||||||
22 | the same dividends caused a reduction to the addition | ||||||
23 | modification required under Section 203(a)(2)(D-17) or | ||||||
24 | Section 203(a)(2)(D-18) of this Act.
| ||||||
25 | (D-20) For taxable years beginning on or after | ||||||
26 | January 1,
2002 and ending on or before December 31, |
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| |||||||
1 | 2006, in
the
case of a distribution from a qualified | ||||||
2 | tuition program under Section 529 of
the Internal | ||||||
3 | Revenue Code, other than (i) a distribution from a | ||||||
4 | College Savings
Pool created under Section 16.5 of the | ||||||
5 | State Treasurer Act or (ii) a
distribution from the | ||||||
6 | Illinois Prepaid Tuition Trust Fund, an amount equal to
| ||||||
7 | the amount excluded from gross income under Section | ||||||
8 | 529(c)(3)(B). For taxable years beginning on or after | ||||||
9 | January 1, 2007, in the case of a distribution from a | ||||||
10 | qualified tuition program under Section 529 of the | ||||||
11 | Internal Revenue Code, other than (i) a distribution | ||||||
12 | from a College Savings Pool created under Section 16.5 | ||||||
13 | of the State Treasurer Act, (ii) a distribution from | ||||||
14 | the Illinois Prepaid Tuition Trust Fund, or (iii) a | ||||||
15 | distribution from a qualified tuition program under | ||||||
16 | Section 529 of the Internal Revenue Code that (I) | ||||||
17 | adopts and determines that its offering materials | ||||||
18 | comply with the College Savings Plans Network's | ||||||
19 | disclosure principles and (II) has made reasonable | ||||||
20 | efforts to inform in-state residents of the existence | ||||||
21 | of in-state qualified tuition programs by informing | ||||||
22 | Illinois residents directly and, where applicable, to | ||||||
23 | inform financial intermediaries distributing the | ||||||
24 | program to inform in-state residents of the existence | ||||||
25 | of in-state qualified tuition programs at least | ||||||
26 | annually, an amount equal to the amount excluded from |
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| |||||||
1 | gross income under Section 529(c)(3)(B). | ||||||
2 | For the purposes of this subparagraph (D-20), a | ||||||
3 | qualified tuition program has made reasonable efforts | ||||||
4 | if it makes disclosures (which may use the term | ||||||
5 | "in-state program" or "in-state plan" and need not | ||||||
6 | specifically refer to Illinois or its qualified | ||||||
7 | programs by name) (i) directly to prospective | ||||||
8 | participants in its offering materials or makes a | ||||||
9 | public disclosure, such as a website posting; and (ii) | ||||||
10 | where applicable, to intermediaries selling the | ||||||
11 | out-of-state program in the same manner that the | ||||||
12 | out-of-state program distributes its offering | ||||||
13 | materials;
| ||||||
14 | (D-21) For taxable years beginning on or after | ||||||
15 | January 1, 2007, in the case of transfer of moneys from | ||||||
16 | a qualified tuition program under Section 529 of the | ||||||
17 | Internal Revenue Code that is administered by the State | ||||||
18 | to an out-of-state program, an amount equal to the | ||||||
19 | amount of moneys previously deducted from base income | ||||||
20 | under subsection (a)(2)(Y) of this Section.
| ||||||
21 | and by deducting from the total so obtained the
sum of the | ||||||
22 | following amounts:
| ||||||
23 | (E) For taxable years ending before December 31, | ||||||
24 | 2001,
any amount included in such total in respect of | ||||||
25 | any compensation
(including but not limited to any | ||||||
26 | compensation paid or accrued to a
serviceman while a |
| |||||||
| |||||||
1 | prisoner of war or missing in action) paid to a | ||||||
2 | resident
by reason of being on active duty in the Armed | ||||||
3 | Forces of the United States
and in respect of any | ||||||
4 | compensation paid or accrued to a resident who as a
| ||||||
5 | governmental employee was a prisoner of war or missing | ||||||
6 | in action, and in
respect of any compensation paid to a | ||||||
7 | resident in 1971 or thereafter for
annual training | ||||||
8 | performed pursuant to Sections 502 and 503, Title 32,
| ||||||
9 | United States Code as a member of the Illinois National | ||||||
10 | Guard or, beginning with taxable years ending on or | ||||||
11 | after December 31, 2007, the National Guard of any | ||||||
12 | other state.
For taxable years ending on or after | ||||||
13 | December 31, 2001, any amount included in
such total in | ||||||
14 | respect of any compensation (including but not limited | ||||||
15 | to any
compensation paid or accrued to a serviceman | ||||||
16 | while a prisoner of war or missing
in action) paid to a | ||||||
17 | resident by reason of being a member of any component | ||||||
18 | of
the Armed Forces of the United States and in respect | ||||||
19 | of any compensation paid
or accrued to a resident who | ||||||
20 | as a governmental employee was a prisoner of war
or | ||||||
21 | missing in action, and in respect of any compensation | ||||||
22 | paid to a resident in
2001 or thereafter by reason of | ||||||
23 | being a member of the Illinois National Guard or, | ||||||
24 | beginning with taxable years ending on or after | ||||||
25 | December 31, 2007, the National Guard of any other | ||||||
26 | state.
The provisions of this amendatory Act of the |
| |||||||
| |||||||
1 | 92nd General Assembly are exempt
from the provisions of | ||||||
2 | Section 250;
| ||||||
3 | (F) An amount equal to all amounts included in such | ||||||
4 | total pursuant
to the provisions of Sections 402(a), | ||||||
5 | 402(c), 403(a), 403(b), 406(a), 407(a),
and 408 of the | ||||||
6 | Internal Revenue Code, or included in such total as
| ||||||
7 | distributions under the provisions of any retirement | ||||||
8 | or disability plan for
employees of any governmental | ||||||
9 | agency or unit, or retirement payments to
retired | ||||||
10 | partners, which payments are excluded in computing net | ||||||
11 | earnings
from self employment by Section 1402 of the | ||||||
12 | Internal Revenue Code and
regulations adopted pursuant | ||||||
13 | thereto;
| ||||||
14 | (G) The valuation limitation amount;
| ||||||
15 | (H) An amount equal to the amount of any tax | ||||||
16 | imposed by this Act
which was refunded to the taxpayer | ||||||
17 | and included in such total for the
taxable year;
| ||||||
18 | (I) An amount equal to all amounts included in such | ||||||
19 | total pursuant
to the provisions of Section 111 of the | ||||||
20 | Internal Revenue Code as a
recovery of items previously | ||||||
21 | deducted from adjusted gross income in the
computation | ||||||
22 | of taxable income;
| ||||||
23 | (J) An amount equal to those dividends included in | ||||||
24 | such total which were
paid by a corporation which | ||||||
25 | conducts business operations in an Enterprise
Zone or | ||||||
26 | zones created under the Illinois Enterprise Zone Act or |
| |||||||
| |||||||
1 | a River Edge Redevelopment Zone or zones created under | ||||||
2 | the River Edge Redevelopment Zone Act, and conducts
| ||||||
3 | substantially all of its operations in an Enterprise | ||||||
4 | Zone or zones or a River Edge Redevelopment Zone or | ||||||
5 | zones. This subparagraph (J) is exempt from the | ||||||
6 | provisions of Section 250;
| ||||||
7 | (K) An amount equal to those dividends included in | ||||||
8 | such total that
were paid by a corporation that | ||||||
9 | conducts business operations in a federally
designated | ||||||
10 | Foreign Trade Zone or Sub-Zone and that is designated a | ||||||
11 | High Impact
Business located in Illinois; provided | ||||||
12 | that dividends eligible for the
deduction provided in | ||||||
13 | subparagraph (J) of paragraph (2) of this subsection
| ||||||
14 | shall not be eligible for the deduction provided under | ||||||
15 | this subparagraph
(K);
| ||||||
16 | (L) For taxable years ending after December 31, | ||||||
17 | 1983, an amount equal to
all social security benefits | ||||||
18 | and railroad retirement benefits included in
such | ||||||
19 | total pursuant to Sections 72(r) and 86 of the Internal | ||||||
20 | Revenue Code;
| ||||||
21 | (M) With the exception of any amounts subtracted | ||||||
22 | under subparagraph
(N), an amount equal to the sum of | ||||||
23 | all amounts disallowed as
deductions by (i) Sections | ||||||
24 | 171(a) (2), and 265(2) of the Internal Revenue Code
of | ||||||
25 | 1954, as now or hereafter amended, and all amounts of | ||||||
26 | expenses allocable
to interest and disallowed as |
| |||||||
| |||||||
1 | deductions by Section 265(1) of the Internal
Revenue | ||||||
2 | Code of 1954, as now or hereafter amended;
and (ii) for | ||||||
3 | taxable years
ending on or after August 13, 1999, | ||||||
4 | Sections 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of | ||||||
5 | the Internal Revenue Code; the provisions of this
| ||||||
6 | subparagraph are exempt from the provisions of Section | ||||||
7 | 250;
| ||||||
8 | (N) An amount equal to all amounts included in such | ||||||
9 | total which are
exempt from taxation by this State | ||||||
10 | either by reason of its statutes or
Constitution
or by | ||||||
11 | reason of the Constitution, treaties or statutes of the | ||||||
12 | United States;
provided that, in the case of any | ||||||
13 | statute of this State that exempts income
derived from | ||||||
14 | bonds or other obligations from the tax imposed under | ||||||
15 | this Act,
the amount exempted shall be the interest net | ||||||
16 | of bond premium amortization;
| ||||||
17 | (O) An amount equal to any contribution made to a | ||||||
18 | job training
project established pursuant to the Tax | ||||||
19 | Increment Allocation Redevelopment Act;
| ||||||
20 | (P) An amount equal to the amount of the deduction | ||||||
21 | used to compute the
federal income tax credit for | ||||||
22 | restoration of substantial amounts held under
claim of | ||||||
23 | right for the taxable year pursuant to Section 1341 of | ||||||
24 | the
Internal Revenue Code of 1986;
| ||||||
25 | (Q) An amount equal to any amounts included in such | ||||||
26 | total, received by
the taxpayer as an acceleration in |
| |||||||
| |||||||
1 | the payment of life, endowment or annuity
benefits in | ||||||
2 | advance of the time they would otherwise be payable as | ||||||
3 | an indemnity
for a terminal illness;
| ||||||
4 | (R) An amount equal to the amount of any federal or | ||||||
5 | State bonus paid
to veterans of the Persian Gulf War;
| ||||||
6 | (S) An amount, to the extent included in adjusted | ||||||
7 | gross income, equal
to the amount of a contribution | ||||||
8 | made in the taxable year on behalf of the
taxpayer to a | ||||||
9 | medical care savings account established under the | ||||||
10 | Medical Care
Savings Account Act or the Medical Care | ||||||
11 | Savings Account Act of 2000 to the
extent the | ||||||
12 | contribution is accepted by the account
administrator | ||||||
13 | as provided in that Act;
| ||||||
14 | (T) An amount, to the extent included in adjusted | ||||||
15 | gross income, equal to
the amount of interest earned in | ||||||
16 | the taxable year on a medical care savings
account | ||||||
17 | established under the Medical Care Savings Account Act | ||||||
18 | or the Medical
Care Savings Account Act of 2000 on | ||||||
19 | behalf of the
taxpayer, other than interest added | ||||||
20 | pursuant to item (D-5) of this paragraph
(2);
| ||||||
21 | (U) For one taxable year beginning on or after | ||||||
22 | January 1,
1994, an
amount equal to the total amount of | ||||||
23 | tax imposed and paid under subsections (a)
and (b) of | ||||||
24 | Section 201 of this Act on grant amounts received by | ||||||
25 | the taxpayer
under the Nursing Home Grant Assistance | ||||||
26 | Act during the taxpayer's taxable years
1992 and 1993;
|
| |||||||
| |||||||
1 | (V) Beginning with tax years ending on or after | ||||||
2 | December 31, 1995 and
ending with tax years ending on | ||||||
3 | or before December 31, 2004, an amount equal to
the | ||||||
4 | amount paid by a taxpayer who is a
self-employed | ||||||
5 | taxpayer, a partner of a partnership, or a
shareholder | ||||||
6 | in a Subchapter S corporation for health insurance or | ||||||
7 | long-term
care insurance for that taxpayer or that | ||||||
8 | taxpayer's spouse or dependents, to
the extent that the | ||||||
9 | amount paid for that health insurance or long-term care
| ||||||
10 | insurance may be deducted under Section 213 of the | ||||||
11 | Internal Revenue Code of
1986, has not been deducted on | ||||||
12 | the federal income tax return of the taxpayer,
and does | ||||||
13 | not exceed the taxable income attributable to that | ||||||
14 | taxpayer's income,
self-employment income, or | ||||||
15 | Subchapter S corporation income; except that no
| ||||||
16 | deduction shall be allowed under this item (V) if the | ||||||
17 | taxpayer is eligible to
participate in any health | ||||||
18 | insurance or long-term care insurance plan of an
| ||||||
19 | employer of the taxpayer or the taxpayer's
spouse. The | ||||||
20 | amount of the health insurance and long-term care | ||||||
21 | insurance
subtracted under this item (V) shall be | ||||||
22 | determined by multiplying total
health insurance and | ||||||
23 | long-term care insurance premiums paid by the taxpayer
| ||||||
24 | times a number that represents the fractional | ||||||
25 | percentage of eligible medical
expenses under Section | ||||||
26 | 213 of the Internal Revenue Code of 1986 not actually
|
| |||||||
| |||||||
1 | deducted on the taxpayer's federal income tax return;
| ||||||
2 | (W) For taxable years beginning on or after January | ||||||
3 | 1, 1998,
all amounts included in the taxpayer's federal | ||||||
4 | gross income
in the taxable year from amounts converted | ||||||
5 | from a regular IRA to a Roth IRA.
This paragraph is | ||||||
6 | exempt from the provisions of Section
250;
| ||||||
7 | (X) For taxable year 1999 and thereafter, an amount | ||||||
8 | equal to the
amount of any (i) distributions, to the | ||||||
9 | extent includible in gross income for
federal income | ||||||
10 | tax purposes, made to the taxpayer because of his or | ||||||
11 | her status
as a victim of persecution for racial or | ||||||
12 | religious reasons by Nazi Germany or
any other Axis | ||||||
13 | regime or as an heir of the victim and (ii) items
of | ||||||
14 | income, to the extent
includible in gross income for | ||||||
15 | federal income tax purposes, attributable to,
derived | ||||||
16 | from or in any way related to assets stolen from, | ||||||
17 | hidden from, or
otherwise lost to a victim of
| ||||||
18 | persecution for racial or religious reasons by Nazi | ||||||
19 | Germany or any other Axis
regime immediately prior to, | ||||||
20 | during, and immediately after World War II,
including, | ||||||
21 | but
not limited to, interest on the proceeds receivable | ||||||
22 | as insurance
under policies issued to a victim of | ||||||
23 | persecution for racial or religious
reasons
by Nazi | ||||||
24 | Germany or any other Axis regime by European insurance | ||||||
25 | companies
immediately prior to and during World War II;
| ||||||
26 | provided, however, this subtraction from federal |
| |||||||
| |||||||
1 | adjusted gross income does not
apply to assets acquired | ||||||
2 | with such assets or with the proceeds from the sale of
| ||||||
3 | such assets; provided, further, this paragraph shall | ||||||
4 | only apply to a taxpayer
who was the first recipient of | ||||||
5 | such assets after their recovery and who is a
victim of | ||||||
6 | persecution for racial or religious reasons
by Nazi | ||||||
7 | Germany or any other Axis regime or as an heir of the | ||||||
8 | victim. The
amount of and the eligibility for any | ||||||
9 | public assistance, benefit, or
similar entitlement is | ||||||
10 | not affected by the inclusion of items (i) and (ii) of
| ||||||
11 | this paragraph in gross income for federal income tax | ||||||
12 | purposes.
This paragraph is exempt from the provisions | ||||||
13 | of Section 250;
| ||||||
14 | (Y) For taxable years beginning on or after January | ||||||
15 | 1, 2002
and ending
on or before December 31, 2004, | ||||||
16 | moneys contributed in the taxable year to a College | ||||||
17 | Savings Pool account under
Section 16.5 of the State | ||||||
18 | Treasurer Act, except that amounts excluded from
gross | ||||||
19 | income under Section 529(c)(3)(C)(i) of the Internal | ||||||
20 | Revenue Code
shall not be considered moneys | ||||||
21 | contributed under this subparagraph (Y). For taxable | ||||||
22 | years beginning on or after January 1, 2005, a maximum | ||||||
23 | of $10,000
contributed
in the
taxable year to (i) a | ||||||
24 | College Savings Pool account under Section 16.5 of the
| ||||||
25 | State
Treasurer Act or (ii) the Illinois Prepaid | ||||||
26 | Tuition Trust Fund,
except that
amounts excluded from |
| |||||||
| |||||||
1 | gross income under Section 529(c)(3)(C)(i) of the
| ||||||
2 | Internal
Revenue Code shall not be considered moneys | ||||||
3 | contributed under this subparagraph
(Y). This
| ||||||
4 | subparagraph (Y) is exempt from the provisions of | ||||||
5 | Section 250;
| ||||||
6 | (Z) For taxable years 2001 and thereafter, for the | ||||||
7 | taxable year in
which the bonus depreciation deduction
| ||||||
8 | is taken on the taxpayer's federal income tax return | ||||||
9 | under
subsection (k) of Section 168 of the Internal | ||||||
10 | Revenue Code and for each
applicable taxable year | ||||||
11 | thereafter, an amount equal to "x", where:
| ||||||
12 | (1) "y" equals the amount of the depreciation | ||||||
13 | deduction taken for the
taxable year
on the | ||||||
14 | taxpayer's federal income tax return on property | ||||||
15 | for which the bonus
depreciation deduction
was | ||||||
16 | taken in any year under subsection (k) of Section | ||||||
17 | 168 of the Internal
Revenue Code, but not including | ||||||
18 | the bonus depreciation deduction;
| ||||||
19 | (2) for taxable years ending on or before | ||||||
20 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
21 | and then divided by 70 (or "y"
multiplied by | ||||||
22 | 0.429); and | ||||||
23 | (3) for taxable years ending after December | ||||||
24 | 31, 2005: | ||||||
25 | (i) for property on which a bonus | ||||||
26 | depreciation deduction of 30% of the adjusted |
| |||||||
| |||||||
1 | basis was taken, "x" equals "y" multiplied by | ||||||
2 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
3 | 0.429); and | ||||||
4 | (ii) for property on which a bonus | ||||||
5 | depreciation deduction of 50% of the adjusted | ||||||
6 | basis was taken, "x" equals "y" multiplied by | ||||||
7 | 1.0.
| ||||||
8 | The aggregate amount deducted under this | ||||||
9 | subparagraph in all taxable
years for any one piece of | ||||||
10 | property may not exceed the amount of the bonus
| ||||||
11 | depreciation deduction
taken on that property on the | ||||||
12 | taxpayer's federal income tax return under
subsection | ||||||
13 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
14 | subparagraph (Z) is exempt from the provisions of | ||||||
15 | Section 250;
| ||||||
16 | (AA) If the taxpayer sells, transfers, abandons, | ||||||
17 | or otherwise disposes of
property for which the | ||||||
18 | taxpayer was required in any taxable year to make an
| ||||||
19 | addition modification under subparagraph (D-15), then | ||||||
20 | an amount equal to that
addition modification.
| ||||||
21 | If the taxpayer continues to own property through | ||||||
22 | the last day of the last tax year for which the | ||||||
23 | taxpayer may claim a depreciation deduction for | ||||||
24 | federal income tax purposes and for which the taxpayer | ||||||
25 | was required in any taxable year to make an addition | ||||||
26 | modification under subparagraph (D-15), then an amount |
| |||||||
| |||||||
1 | equal to that addition modification.
| ||||||
2 | The taxpayer is allowed to take the deduction under | ||||||
3 | this subparagraph
only once with respect to any one | ||||||
4 | piece of property. | ||||||
5 | This subparagraph (AA) is exempt from the | ||||||
6 | provisions of Section 250;
| ||||||
7 | (BB) Any amount included in adjusted gross income, | ||||||
8 | other
than
salary,
received by a driver in a | ||||||
9 | ridesharing arrangement using a motor vehicle;
| ||||||
10 | (CC) The amount of (i) any interest income (net of | ||||||
11 | the deductions allocable thereto) taken into account | ||||||
12 | for the taxable year with respect to a transaction with | ||||||
13 | a taxpayer that is required to make an addition | ||||||
14 | modification with respect to such transaction under | ||||||
15 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
16 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
17 | the amount of that addition modification, and
(ii) any | ||||||
18 | income from intangible property (net of the deductions | ||||||
19 | allocable thereto) taken into account for the taxable | ||||||
20 | year with respect to a transaction with a taxpayer that | ||||||
21 | is required to make an addition modification with | ||||||
22 | respect to such transaction under Section | ||||||
23 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
24 | 203(d)(2)(D-8), but not to exceed the amount of that | ||||||
25 | addition modification. This subparagraph (CC) is | ||||||
26 | exempt from the provisions of Section 250; |
| |||||||
| |||||||
1 | (DD) An amount equal to the interest income taken | ||||||
2 | into account for the taxable year (net of the | ||||||
3 | deductions allocable thereto) with respect to | ||||||
4 | transactions with (i) a foreign person who would be a | ||||||
5 | member of the taxpayer's unitary business group but for | ||||||
6 | the fact that the foreign person's business activity | ||||||
7 | outside the United States is 80% or more of that | ||||||
8 | person's total business activity and (ii) for taxable | ||||||
9 | years ending on or after December 31, 2008, to a person | ||||||
10 | who would be a member of the same unitary business | ||||||
11 | group but for the fact that the person is prohibited | ||||||
12 | under Section 1501(a)(27) from being included in the | ||||||
13 | unitary business group because he or she is ordinarily | ||||||
14 | required to apportion business income under different | ||||||
15 | subsections of Section 304, but not to exceed the | ||||||
16 | addition modification required to be made for the same | ||||||
17 | taxable year under Section 203(a)(2)(D-17) for | ||||||
18 | interest paid, accrued, or incurred, directly or | ||||||
19 | indirectly, to the same person. This subparagraph (DD) | ||||||
20 | is exempt from the provisions of Section 250; and | ||||||
21 | (EE) An amount equal to the income from intangible | ||||||
22 | property taken into account for the taxable year (net | ||||||
23 | of the deductions allocable thereto) with respect to | ||||||
24 | transactions with (i) a foreign person who would be a | ||||||
25 | member of the taxpayer's unitary business group but for | ||||||
26 | the fact that the foreign person's business activity |
| |||||||
| |||||||
1 | outside the United States is 80% or more of that | ||||||
2 | person's total business activity and (ii) for taxable | ||||||
3 | years ending on or after December 31, 2008, to a person | ||||||
4 | who would be a member of the same unitary business | ||||||
5 | group but for the fact that the person is prohibited | ||||||
6 | under Section 1501(a)(27) from being included in the | ||||||
7 | unitary business group because he or she is ordinarily | ||||||
8 | required to apportion business income under different | ||||||
9 | subsections of Section 304, but not to exceed the | ||||||
10 | addition modification required to be made for the same | ||||||
11 | taxable year under Section 203(a)(2)(D-18) for | ||||||
12 | intangible expenses and costs paid, accrued, or | ||||||
13 | incurred, directly or indirectly, to the same foreign | ||||||
14 | person. This subparagraph (EE) is exempt from the | ||||||
15 | provisions of Section 250.
| ||||||
16 | (b) Corporations.
| ||||||
17 | (1) In general. In the case of a corporation, base | ||||||
18 | income means an
amount equal to the taxpayer's taxable | ||||||
19 | income for the taxable year as
modified by paragraph (2).
| ||||||
20 | (2) Modifications. The taxable income referred to in | ||||||
21 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
22 | of the following amounts:
| ||||||
23 | (A) An amount equal to all amounts paid or accrued | ||||||
24 | to the taxpayer
as interest and all distributions | ||||||
25 | received from regulated investment
companies during |
| |||||||
| |||||||
1 | the taxable year to the extent excluded from gross
| ||||||
2 | income in the computation of taxable income;
| ||||||
3 | (B) An amount equal to the amount of tax imposed by | ||||||
4 | this Act to the
extent deducted from gross income in | ||||||
5 | the computation of taxable income
for the taxable year;
| ||||||
6 | (C) In the case of a regulated investment company, | ||||||
7 | an amount equal to
the excess of (i) the net long-term | ||||||
8 | capital gain for the taxable year, over
(ii) the amount | ||||||
9 | of the capital gain dividends designated as such in | ||||||
10 | accordance
with Section 852(b)(3)(C) of the Internal | ||||||
11 | Revenue Code and any amount
designated under Section | ||||||
12 | 852(b)(3)(D) of the Internal Revenue Code,
| ||||||
13 | attributable to the taxable year (this amendatory Act | ||||||
14 | of 1995
(Public Act 89-89) is declarative of existing | ||||||
15 | law and is not a new
enactment);
| ||||||
16 | (D) The amount of any net operating loss deduction | ||||||
17 | taken in arriving
at taxable income, other than a net | ||||||
18 | operating loss carried forward from a
taxable year | ||||||
19 | ending prior to December 31, 1986;
| ||||||
20 | (E) For taxable years in which a net operating loss | ||||||
21 | carryback or
carryforward from a taxable year ending | ||||||
22 | prior to December 31, 1986 is an
element of taxable | ||||||
23 | income under paragraph (1) of subsection (e) or
| ||||||
24 | subparagraph (E) of paragraph (2) of subsection (e), | ||||||
25 | the amount by which
addition modifications other than | ||||||
26 | those provided by this subparagraph (E)
exceeded |
| |||||||
| |||||||
1 | subtraction modifications in such earlier taxable | ||||||
2 | year, with the
following limitations applied in the | ||||||
3 | order that they are listed:
| ||||||
4 | (i) the addition modification relating to the | ||||||
5 | net operating loss
carried back or forward to the | ||||||
6 | taxable year from any taxable year ending
prior to | ||||||
7 | December 31, 1986 shall be reduced by the amount of | ||||||
8 | addition
modification under this subparagraph (E) | ||||||
9 | which related to that net operating
loss and which | ||||||
10 | was taken into account in calculating the base | ||||||
11 | income of an
earlier taxable year, and
| ||||||
12 | (ii) the addition modification relating to the | ||||||
13 | net operating loss
carried back or forward to the | ||||||
14 | taxable year from any taxable year ending
prior to | ||||||
15 | December 31, 1986 shall not exceed the amount of | ||||||
16 | such carryback or
carryforward;
| ||||||
17 | For taxable years in which there is a net operating | ||||||
18 | loss carryback or
carryforward from more than one other | ||||||
19 | taxable year ending prior to December
31, 1986, the | ||||||
20 | addition modification provided in this subparagraph | ||||||
21 | (E) shall
be the sum of the amounts computed | ||||||
22 | independently under the preceding
provisions of this | ||||||
23 | subparagraph (E) for each such taxable year;
| ||||||
24 | (E-5) For taxable years ending after December 31, | ||||||
25 | 1997, an
amount equal to any eligible remediation costs | ||||||
26 | that the corporation
deducted in computing adjusted |
| |||||||
| |||||||
1 | gross income and for which the
corporation claims a | ||||||
2 | credit under subsection (l) of Section 201;
| ||||||
3 | (E-10) For taxable years 2001 and thereafter, an | ||||||
4 | amount equal to the
bonus depreciation deduction taken | ||||||
5 | on the taxpayer's federal income tax return for the | ||||||
6 | taxable
year under subsection (k) of Section 168 of the | ||||||
7 | Internal Revenue Code;
| ||||||
8 | (E-11) If the taxpayer sells, transfers, abandons, | ||||||
9 | or otherwise disposes of property for which the | ||||||
10 | taxpayer was required in any taxable year to
make an | ||||||
11 | addition modification under subparagraph (E-10), then | ||||||
12 | an amount equal
to the aggregate amount of the | ||||||
13 | deductions taken in all taxable
years under | ||||||
14 | subparagraph (T) with respect to that property.
| ||||||
15 | If the taxpayer continues to own property through | ||||||
16 | the last day of the last tax year for which the | ||||||
17 | taxpayer may claim a depreciation deduction for | ||||||
18 | federal income tax purposes and for which the taxpayer | ||||||
19 | was allowed in any taxable year to make a subtraction | ||||||
20 | modification under subparagraph (T), then an amount | ||||||
21 | equal to that subtraction modification.
| ||||||
22 | The taxpayer is required to make the addition | ||||||
23 | modification under this
subparagraph
only once with | ||||||
24 | respect to any one piece of property;
| ||||||
25 | (E-12) An amount equal to the amount otherwise | ||||||
26 | allowed as a deduction in computing base income for |
| |||||||
| |||||||
1 | interest paid, accrued, or incurred, directly or | ||||||
2 | indirectly, (i) for taxable years ending on or after | ||||||
3 | December 31, 2004, to a foreign person who would be a | ||||||
4 | member of the same unitary business group but for the | ||||||
5 | fact the foreign person's business activity outside | ||||||
6 | the United States is 80% or more of the foreign | ||||||
7 | person's total business activity and (ii) for taxable | ||||||
8 | years ending on or after December 31, 2008, to a person | ||||||
9 | who would be a member of the same unitary business | ||||||
10 | group but for the fact that the person is prohibited | ||||||
11 | under Section 1501(a)(27) from being included in the | ||||||
12 | unitary business group because he or she is ordinarily | ||||||
13 | required to apportion business income under different | ||||||
14 | subsections of Section 304. The addition modification | ||||||
15 | required by this subparagraph shall be reduced to the | ||||||
16 | extent that dividends were included in base income of | ||||||
17 | the unitary group for the same taxable year and | ||||||
18 | received by the taxpayer or by a member of the | ||||||
19 | taxpayer's unitary business group (including amounts | ||||||
20 | included in gross income pursuant to Sections 951 | ||||||
21 | through 964 of the Internal Revenue Code and amounts | ||||||
22 | included in gross income under Section 78 of the | ||||||
23 | Internal Revenue Code) with respect to the stock of the | ||||||
24 | same person to whom the interest was paid, accrued, or | ||||||
25 | incurred.
| ||||||
26 | This paragraph shall not apply to the following:
|
| |||||||
| |||||||
1 | (i) an item of interest paid, accrued, or | ||||||
2 | incurred, directly or indirectly, to a person who | ||||||
3 | is subject in a foreign country or state, other | ||||||
4 | than a state which requires mandatory unitary | ||||||
5 | reporting, to a tax on or measured by net income | ||||||
6 | with respect to such interest; or | ||||||
7 | (ii) an item of interest paid, accrued, or | ||||||
8 | incurred, directly or indirectly, to a person if | ||||||
9 | the taxpayer can establish, based on a | ||||||
10 | preponderance of the evidence, both of the | ||||||
11 | following: | ||||||
12 | (a) the person, during the same taxable | ||||||
13 | year, paid, accrued, or incurred, the interest | ||||||
14 | to a person that is not a related member, and | ||||||
15 | (b) the transaction giving rise to the | ||||||
16 | interest expense between the taxpayer and the | ||||||
17 | person did not have as a principal purpose the | ||||||
18 | avoidance of Illinois income tax, and is paid | ||||||
19 | pursuant to a contract or agreement that | ||||||
20 | reflects an arm's-length interest rate and | ||||||
21 | terms; or
| ||||||
22 | (iii) the taxpayer can establish, based on | ||||||
23 | clear and convincing evidence, that the interest | ||||||
24 | paid, accrued, or incurred relates to a contract or | ||||||
25 | agreement entered into at arm's-length rates and | ||||||
26 | terms and the principal purpose for the payment is |
| |||||||
| |||||||
1 | not federal or Illinois tax avoidance; or
| ||||||
2 | (iv) an item of interest paid, accrued, or | ||||||
3 | incurred, directly or indirectly, to a person if | ||||||
4 | the taxpayer establishes by clear and convincing | ||||||
5 | evidence that the adjustments are unreasonable; or | ||||||
6 | if the taxpayer and the Director agree in writing | ||||||
7 | to the application or use of an alternative method | ||||||
8 | of apportionment under Section 304(f).
| ||||||
9 | Nothing in this subsection shall preclude the | ||||||
10 | Director from making any other adjustment | ||||||
11 | otherwise allowed under Section 404 of this Act for | ||||||
12 | any tax year beginning after the effective date of | ||||||
13 | this amendment provided such adjustment is made | ||||||
14 | pursuant to regulation adopted by the Department | ||||||
15 | and such regulations provide methods and standards | ||||||
16 | by which the Department will utilize its authority | ||||||
17 | under Section 404 of this Act;
| ||||||
18 | (E-13) An amount equal to the amount of intangible | ||||||
19 | expenses and costs otherwise allowed as a deduction in | ||||||
20 | computing base income, and that were paid, accrued, or | ||||||
21 | incurred, directly or indirectly, (i) for taxable | ||||||
22 | years ending on or after December 31, 2004, to a | ||||||
23 | foreign person who would be a member of the same | ||||||
24 | unitary business group but for the fact that the | ||||||
25 | foreign person's business activity outside the United | ||||||
26 | States is 80% or more of that person's total business |
| |||||||
| |||||||
1 | activity and (ii) for taxable years ending on or after | ||||||
2 | December 31, 2008, to a person who would be a member of | ||||||
3 | the same unitary business group but for the fact that | ||||||
4 | the person is prohibited under Section 1501(a)(27) | ||||||
5 | from being included in the unitary business group | ||||||
6 | because he or she is ordinarily required to apportion | ||||||
7 | business income under different subsections of Section | ||||||
8 | 304. The addition modification required by this | ||||||
9 | subparagraph shall be reduced to the extent that | ||||||
10 | dividends were included in base income of the unitary | ||||||
11 | group for the same taxable year and received by the | ||||||
12 | taxpayer or by a member of the taxpayer's unitary | ||||||
13 | business group (including amounts included in gross | ||||||
14 | income pursuant to Sections 951 through 964 of the | ||||||
15 | Internal Revenue Code and amounts included in gross | ||||||
16 | income under Section 78 of the Internal Revenue Code) | ||||||
17 | with respect to the stock of the same person to whom | ||||||
18 | the intangible expenses and costs were directly or | ||||||
19 | indirectly paid, incurred, or accrued. The preceding | ||||||
20 | sentence shall not apply to the extent that the same | ||||||
21 | dividends caused a reduction to the addition | ||||||
22 | modification required under Section 203(b)(2)(E-12) of | ||||||
23 | this Act.
As used in this subparagraph, the term | ||||||
24 | "intangible expenses and costs" includes (1) expenses, | ||||||
25 | losses, and costs for, or related to, the direct or | ||||||
26 | indirect acquisition, use, maintenance or management, |
| |||||||
| |||||||
1 | ownership, sale, exchange, or any other disposition of | ||||||
2 | intangible property; (2) losses incurred, directly or | ||||||
3 | indirectly, from factoring transactions or discounting | ||||||
4 | transactions; (3) royalty, patent, technical, and | ||||||
5 | copyright fees; (4) licensing fees; and (5) other | ||||||
6 | similar expenses and costs.
For purposes of this | ||||||
7 | subparagraph, "intangible property" includes patents, | ||||||
8 | patent applications, trade names, trademarks, service | ||||||
9 | marks, copyrights, mask works, trade secrets, and | ||||||
10 | similar types of intangible assets. | ||||||
11 | This paragraph shall not apply to the following: | ||||||
12 | (i) any item of intangible expenses or costs | ||||||
13 | paid, accrued, or incurred, directly or | ||||||
14 | indirectly, from a transaction with a person who is | ||||||
15 | subject in a foreign country or state, other than a | ||||||
16 | state which requires mandatory unitary reporting, | ||||||
17 | to a tax on or measured by net income with respect | ||||||
18 | to such item; or | ||||||
19 | (ii) any item of intangible expense or cost | ||||||
20 | paid, accrued, or incurred, directly or | ||||||
21 | indirectly, if the taxpayer can establish, based | ||||||
22 | on a preponderance of the evidence, both of the | ||||||
23 | following: | ||||||
24 | (a) the person during the same taxable | ||||||
25 | year paid, accrued, or incurred, the | ||||||
26 | intangible expense or cost to a person that is |
| |||||||
| |||||||
1 | not a related member, and | ||||||
2 | (b) the transaction giving rise to the | ||||||
3 | intangible expense or cost between the | ||||||
4 | taxpayer and the person did not have as a | ||||||
5 | principal purpose the avoidance of Illinois | ||||||
6 | income tax, and is paid pursuant to a contract | ||||||
7 | or agreement that reflects arm's-length terms; | ||||||
8 | or | ||||||
9 | (iii) any item of intangible expense or cost | ||||||
10 | paid, accrued, or incurred, directly or | ||||||
11 | indirectly, from a transaction with a person if the | ||||||
12 | taxpayer establishes by clear and convincing | ||||||
13 | evidence, that the adjustments are unreasonable; | ||||||
14 | or if the taxpayer and the Director agree in | ||||||
15 | writing to the application or use of an alternative | ||||||
16 | method of apportionment under Section 304(f);
| ||||||
17 | Nothing in this subsection shall preclude the | ||||||
18 | Director from making any other adjustment | ||||||
19 | otherwise allowed under Section 404 of this Act for | ||||||
20 | any tax year beginning after the effective date of | ||||||
21 | this amendment provided such adjustment is made | ||||||
22 | pursuant to regulation adopted by the Department | ||||||
23 | and such regulations provide methods and standards | ||||||
24 | by which the Department will utilize its authority | ||||||
25 | under Section 404 of this Act;
| ||||||
26 | (E-14) For taxable years ending on or after |
| |||||||
| |||||||
1 | December 31, 2008, an amount equal to the amount of | ||||||
2 | insurance premium expenses and costs otherwise allowed | ||||||
3 | as a deduction in computing base income, and that were | ||||||
4 | paid, accrued, or incurred, directly or indirectly, to | ||||||
5 | a person who would be a member of the same unitary | ||||||
6 | business group but for the fact that the person is | ||||||
7 | prohibited under Section 1501(a)(27) from being | ||||||
8 | included in the unitary business group because he or | ||||||
9 | she is ordinarily required to apportion business | ||||||
10 | income under different subsections of Section 304. The | ||||||
11 | addition modification required by this subparagraph | ||||||
12 | shall be reduced to the extent that dividends were | ||||||
13 | included in base income of the unitary group for the | ||||||
14 | same taxable year and received by the taxpayer or by a | ||||||
15 | member of the taxpayer's unitary business group | ||||||
16 | (including amounts included in gross income under | ||||||
17 | Sections 951 through 964 of the Internal Revenue Code | ||||||
18 | and amounts included in gross income under Section 78 | ||||||
19 | of the Internal Revenue Code) with respect to the stock | ||||||
20 | of the same person to whom the premiums and costs were | ||||||
21 | directly or indirectly paid, incurred, or accrued. The | ||||||
22 | preceding sentence does not apply to the extent that | ||||||
23 | the same dividends caused a reduction to the addition | ||||||
24 | modification required under Section 203(b)(2)(E-12) or | ||||||
25 | Section 203(b)(2)(E-13) of this Act;
| ||||||
26 | (E-15) For taxable years beginning after December |
| |||||||
| |||||||
1 | 31, 2008, any deduction for dividends paid by a captive | ||||||
2 | real estate investment trust that is allowed to a real | ||||||
3 | estate investment trust under Section 857(b)(2)(B) of | ||||||
4 | the Internal Revenue Code for dividends paid;
| ||||||
5 | and by deducting from the total so obtained the sum of the | ||||||
6 | following
amounts:
| ||||||
7 | (F) An amount equal to the amount of any tax | ||||||
8 | imposed by this Act
which was refunded to the taxpayer | ||||||
9 | and included in such total for the
taxable year;
| ||||||
10 | (G) An amount equal to any amount included in such | ||||||
11 | total under
Section 78 of the Internal Revenue Code;
| ||||||
12 | (H) In the case of a regulated investment company, | ||||||
13 | an amount equal
to the amount of exempt interest | ||||||
14 | dividends as defined in subsection (b)
(5) of Section | ||||||
15 | 852 of the Internal Revenue Code, paid to shareholders
| ||||||
16 | for the taxable year;
| ||||||
17 | (I) With the exception of any amounts subtracted | ||||||
18 | under subparagraph
(J),
an amount equal to the sum of | ||||||
19 | all amounts disallowed as
deductions by (i) Sections | ||||||
20 | 171(a) (2), and 265(a)(2) and amounts disallowed as
| ||||||
21 | interest expense by Section 291(a)(3) of the Internal | ||||||
22 | Revenue Code, as now
or hereafter amended, and all | ||||||
23 | amounts of expenses allocable to interest and
| ||||||
24 | disallowed as deductions by Section 265(a)(1) of the | ||||||
25 | Internal Revenue Code,
as now or hereafter amended;
and | ||||||
26 | (ii) for taxable years
ending on or after August 13, |
| |||||||
| |||||||
1 | 1999, Sections
171(a)(2), 265,
280C, 291(a)(3), and | ||||||
2 | 832(b)(5)(B)(i) of the Internal Revenue Code; the
| ||||||
3 | provisions of this
subparagraph are exempt from the | ||||||
4 | provisions of Section 250;
| ||||||
5 | (J) An amount equal to all amounts included in such | ||||||
6 | total which are
exempt from taxation by this State | ||||||
7 | either by reason of its statutes or
Constitution
or by | ||||||
8 | reason of the Constitution, treaties or statutes of the | ||||||
9 | United States;
provided that, in the case of any | ||||||
10 | statute of this State that exempts income
derived from | ||||||
11 | bonds or other obligations from the tax imposed under | ||||||
12 | this Act,
the amount exempted shall be the interest net | ||||||
13 | of bond premium amortization;
| ||||||
14 | (K) An amount equal to those dividends included in | ||||||
15 | such total
which were paid by a corporation which | ||||||
16 | conducts
business operations in an Enterprise Zone or | ||||||
17 | zones created under
the Illinois Enterprise Zone Act or | ||||||
18 | a River Edge Redevelopment Zone or zones created under | ||||||
19 | the River Edge Redevelopment Zone Act and conducts | ||||||
20 | substantially all of its
operations in an Enterprise | ||||||
21 | Zone or zones or a River Edge Redevelopment Zone or | ||||||
22 | zones. This subparagraph (K) is exempt from the | ||||||
23 | provisions of Section 250;
| ||||||
24 | (L) An amount equal to those dividends included in | ||||||
25 | such total that
were paid by a corporation that | ||||||
26 | conducts business operations in a federally
designated |
| |||||||
| |||||||
1 | Foreign Trade Zone or Sub-Zone and that is designated a | ||||||
2 | High Impact
Business located in Illinois; provided | ||||||
3 | that dividends eligible for the
deduction provided in | ||||||
4 | subparagraph (K) of paragraph 2 of this subsection
| ||||||
5 | shall not be eligible for the deduction provided under | ||||||
6 | this subparagraph
(L);
| ||||||
7 | (M) For any taxpayer that is a financial | ||||||
8 | organization within the meaning
of Section 304(c) of | ||||||
9 | this Act, an amount included in such total as interest
| ||||||
10 | income from a loan or loans made by such taxpayer to a | ||||||
11 | borrower, to the extent
that such a loan is secured by | ||||||
12 | property which is eligible for the Enterprise
Zone | ||||||
13 | Investment Credit or the River Edge Redevelopment Zone | ||||||
14 | Investment Credit. To determine the portion of a loan | ||||||
15 | or loans that is
secured by property eligible for a | ||||||
16 | Section 201(f) investment
credit to the borrower, the | ||||||
17 | entire principal amount of the loan or loans
between | ||||||
18 | the taxpayer and the borrower should be divided into | ||||||
19 | the basis of the
Section 201(f) investment credit | ||||||
20 | property which secures the
loan or loans, using for | ||||||
21 | this purpose the original basis of such property on
the | ||||||
22 | date that it was placed in service in the
Enterprise | ||||||
23 | Zone or the River Edge Redevelopment Zone. The | ||||||
24 | subtraction modification available to taxpayer in any
| ||||||
25 | year under this subsection shall be that portion of the | ||||||
26 | total interest paid
by the borrower with respect to |
| |||||||
| |||||||
1 | such loan attributable to the eligible
property as | ||||||
2 | calculated under the previous sentence. This | ||||||
3 | subparagraph (M) is exempt from the provisions of | ||||||
4 | Section 250;
| ||||||
5 | (M-1) For any taxpayer that is a financial | ||||||
6 | organization within the
meaning of Section 304(c) of | ||||||
7 | this Act, an amount included in such total as
interest | ||||||
8 | income from a loan or loans made by such taxpayer to a | ||||||
9 | borrower,
to the extent that such a loan is secured by | ||||||
10 | property which is eligible for
the High Impact Business | ||||||
11 | Investment Credit. To determine the portion of a
loan | ||||||
12 | or loans that is secured by property eligible for a | ||||||
13 | Section 201(h) investment credit to the borrower, the | ||||||
14 | entire principal amount of
the loan or loans between | ||||||
15 | the taxpayer and the borrower should be divided into
| ||||||
16 | the basis of the Section 201(h) investment credit | ||||||
17 | property which
secures the loan or loans, using for | ||||||
18 | this purpose the original basis of such
property on the | ||||||
19 | date that it was placed in service in a federally | ||||||
20 | designated
Foreign Trade Zone or Sub-Zone located in | ||||||
21 | Illinois. No taxpayer that is
eligible for the | ||||||
22 | deduction provided in subparagraph (M) of paragraph | ||||||
23 | (2) of
this subsection shall be eligible for the | ||||||
24 | deduction provided under this
subparagraph (M-1). The | ||||||
25 | subtraction modification available to taxpayers in
any | ||||||
26 | year under this subsection shall be that portion of the |
| |||||||
| |||||||
1 | total interest
paid by the borrower with respect to | ||||||
2 | such loan attributable to the eligible
property as | ||||||
3 | calculated under the previous sentence;
| ||||||
4 | (N) Two times any contribution made during the | ||||||
5 | taxable year to a
designated zone organization to the | ||||||
6 | extent that the contribution (i)
qualifies as a | ||||||
7 | charitable contribution under subsection (c) of | ||||||
8 | Section 170
of the Internal Revenue Code and (ii) must, | ||||||
9 | by its terms, be used for a
project approved by the | ||||||
10 | Department of Commerce and Economic Opportunity under | ||||||
11 | Section 11 of the Illinois Enterprise Zone Act or under | ||||||
12 | Section 10-10 of the River Edge Redevelopment Zone Act. | ||||||
13 | This subparagraph (N) is exempt from the provisions of | ||||||
14 | Section 250;
| ||||||
15 | (O) An amount equal to: (i) 85% for taxable years | ||||||
16 | ending on or before
December 31, 1992, or, a percentage | ||||||
17 | equal to the percentage allowable under
Section | ||||||
18 | 243(a)(1) of the Internal Revenue Code of 1986 for | ||||||
19 | taxable years ending
after December 31, 1992, of the | ||||||
20 | amount by which dividends included in taxable
income | ||||||
21 | and received from a corporation that is not created or | ||||||
22 | organized under
the laws of the United States or any | ||||||
23 | state or political subdivision thereof,
including, for | ||||||
24 | taxable years ending on or after December 31, 1988, | ||||||
25 | dividends
received or deemed received or paid or deemed | ||||||
26 | paid under Sections 951 through
964 of the Internal |
| |||||||
| |||||||
1 | Revenue Code, exceed the amount of the modification
| ||||||
2 | provided under subparagraph (G) of paragraph (2) of | ||||||
3 | this subsection (b) which
is related to such dividends, | ||||||
4 | and including, for taxable years ending on or after | ||||||
5 | December 31, 2008, dividends received from a captive | ||||||
6 | real estate investment trust; plus (ii) 100% of the | ||||||
7 | amount by which dividends,
included in taxable income | ||||||
8 | and received, including, for taxable years ending on
or | ||||||
9 | after December 31, 1988, dividends received or deemed | ||||||
10 | received or paid or
deemed paid under Sections 951 | ||||||
11 | through 964 of the Internal Revenue Code and including, | ||||||
12 | for taxable years ending on or after December 31, 2008, | ||||||
13 | dividends received from a captive real estate | ||||||
14 | investment trust, from
any such corporation specified | ||||||
15 | in clause (i) that would but for the provisions
of | ||||||
16 | Section 1504 (b) (3) of the Internal Revenue Code be | ||||||
17 | treated as a member of
the affiliated group which | ||||||
18 | includes the dividend recipient, exceed the amount
of | ||||||
19 | the modification provided under subparagraph (G) of | ||||||
20 | paragraph (2) of this
subsection (b) which is related | ||||||
21 | to such dividends. This subparagraph (O) is exempt from | ||||||
22 | the provisions of Section 250 of this Act;
| ||||||
23 | (P) An amount equal to any contribution made to a | ||||||
24 | job training project
established pursuant to the Tax | ||||||
25 | Increment Allocation Redevelopment Act;
| ||||||
26 | (Q) An amount equal to the amount of the deduction |
| |||||||
| |||||||
1 | used to compute the
federal income tax credit for | ||||||
2 | restoration of substantial amounts held under
claim of | ||||||
3 | right for the taxable year pursuant to Section 1341 of | ||||||
4 | the
Internal Revenue Code of 1986;
| ||||||
5 | (R) On and after July 20, 1999, in the case of an | ||||||
6 | attorney-in-fact with respect to whom an
interinsurer | ||||||
7 | or a reciprocal insurer has made the election under | ||||||
8 | Section 835 of
the Internal Revenue Code, 26 U.S.C. | ||||||
9 | 835, an amount equal to the excess, if
any, of the | ||||||
10 | amounts paid or incurred by that interinsurer or | ||||||
11 | reciprocal insurer
in the taxable year to the | ||||||
12 | attorney-in-fact over the deduction allowed to that
| ||||||
13 | interinsurer or reciprocal insurer with respect to the | ||||||
14 | attorney-in-fact under
Section 835(b) of the Internal | ||||||
15 | Revenue Code for the taxable year; the provisions of | ||||||
16 | this subparagraph are exempt from the provisions of | ||||||
17 | Section 250;
| ||||||
18 | (S) For taxable years ending on or after December | ||||||
19 | 31, 1997, in the
case of a Subchapter
S corporation, an | ||||||
20 | amount equal to all amounts of income allocable to a
| ||||||
21 | shareholder subject to the Personal Property Tax | ||||||
22 | Replacement Income Tax imposed
by subsections (c) and | ||||||
23 | (d) of Section 201 of this Act, including amounts
| ||||||
24 | allocable to organizations exempt from federal income | ||||||
25 | tax by reason of Section
501(a) of the Internal Revenue | ||||||
26 | Code. This subparagraph (S) is exempt from
the |
| |||||||
| |||||||
1 | provisions of Section 250;
| ||||||
2 | (T) For taxable years 2001 and thereafter, for the | ||||||
3 | taxable year in
which the bonus depreciation deduction
| ||||||
4 | is taken on the taxpayer's federal income tax return | ||||||
5 | under
subsection (k) of Section 168 of the Internal | ||||||
6 | Revenue Code and for each
applicable taxable year | ||||||
7 | thereafter, an amount equal to "x", where:
| ||||||
8 | (1) "y" equals the amount of the depreciation | ||||||
9 | deduction taken for the
taxable year
on the | ||||||
10 | taxpayer's federal income tax return on property | ||||||
11 | for which the bonus
depreciation deduction
was | ||||||
12 | taken in any year under subsection (k) of Section | ||||||
13 | 168 of the Internal
Revenue Code, but not including | ||||||
14 | the bonus depreciation deduction;
| ||||||
15 | (2) for taxable years ending on or before | ||||||
16 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
17 | and then divided by 70 (or "y"
multiplied by | ||||||
18 | 0.429); and | ||||||
19 | (3) for taxable years ending after December | ||||||
20 | 31, 2005: | ||||||
21 | (i) for property on which a bonus | ||||||
22 | depreciation deduction of 30% of the adjusted | ||||||
23 | basis was taken, "x" equals "y" multiplied by | ||||||
24 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
25 | 0.429); and | ||||||
26 | (ii) for property on which a bonus |
| |||||||
| |||||||
1 | depreciation deduction of 50% of the adjusted | ||||||
2 | basis was taken, "x" equals "y" multiplied by | ||||||
3 | 1.0.
| ||||||
4 | The aggregate amount deducted under this | ||||||
5 | subparagraph in all taxable
years for any one piece of | ||||||
6 | property may not exceed the amount of the bonus
| ||||||
7 | depreciation deduction
taken on that property on the | ||||||
8 | taxpayer's federal income tax return under
subsection | ||||||
9 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
10 | subparagraph (T) is exempt from the provisions of | ||||||
11 | Section 250;
| ||||||
12 | (U) If the taxpayer sells, transfers, abandons, or | ||||||
13 | otherwise disposes of
property for which the taxpayer | ||||||
14 | was required in any taxable year to make an
addition | ||||||
15 | modification under subparagraph (E-10), then an amount | ||||||
16 | equal to that
addition modification.
| ||||||
17 | If the taxpayer continues to own property through | ||||||
18 | the last day of the last tax year for which the | ||||||
19 | taxpayer may claim a depreciation deduction for | ||||||
20 | federal income tax purposes and for which the taxpayer | ||||||
21 | was required in any taxable year to make an addition | ||||||
22 | modification under subparagraph (E-10), then an amount | ||||||
23 | equal to that addition modification.
| ||||||
24 | The taxpayer is allowed to take the deduction under | ||||||
25 | this subparagraph
only once with respect to any one | ||||||
26 | piece of property. |
| |||||||
| |||||||
1 | This subparagraph (U) is exempt from the | ||||||
2 | provisions of Section 250;
| ||||||
3 | (V) The amount of: (i) any interest income (net of | ||||||
4 | the deductions allocable thereto) taken into account | ||||||
5 | for the taxable year with respect to a transaction with | ||||||
6 | a taxpayer that is required to make an addition | ||||||
7 | modification with respect to such transaction under | ||||||
8 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
9 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
10 | the amount of such addition modification,
(ii) any | ||||||
11 | income from intangible property (net of the deductions | ||||||
12 | allocable thereto) taken into account for the taxable | ||||||
13 | year with respect to a transaction with a taxpayer that | ||||||
14 | is required to make an addition modification with | ||||||
15 | respect to such transaction under Section | ||||||
16 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
17 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
18 | addition modification, and (iii) any insurance premium | ||||||
19 | income (net of deductions allocable thereto) taken | ||||||
20 | into account for the taxable year with respect to a | ||||||
21 | transaction with a taxpayer that is required to make an | ||||||
22 | addition modification with respect to such transaction | ||||||
23 | under Section 203(a)(2)(D-19), Section | ||||||
24 | 203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section | ||||||
25 | 203(d)(2)(D-9), but not to exceed the amount of that | ||||||
26 | addition modification. This subparagraph (V) is exempt |
| |||||||
| |||||||
1 | from the provisions of Section 250;
| ||||||
2 | (W) An amount equal to the interest income taken | ||||||
3 | into account for the taxable year (net of the | ||||||
4 | deductions allocable thereto) with respect to | ||||||
5 | transactions with (i) a foreign person who would be a | ||||||
6 | member of the taxpayer's unitary business group but for | ||||||
7 | the fact that the foreign person's business activity | ||||||
8 | outside the United States is 80% or more of that | ||||||
9 | person's total business activity and (ii) for taxable | ||||||
10 | years ending on or after December 31, 2008, to a person | ||||||
11 | who would be a member of the same unitary business | ||||||
12 | group but for the fact that the person is prohibited | ||||||
13 | under Section 1501(a)(27) from being included in the | ||||||
14 | unitary business group because he or she is ordinarily | ||||||
15 | required to apportion business income under different | ||||||
16 | subsections of Section 304, but not to exceed the | ||||||
17 | addition modification required to be made for the same | ||||||
18 | taxable year under Section 203(b)(2)(E-12) for | ||||||
19 | interest paid, accrued, or incurred, directly or | ||||||
20 | indirectly, to the same person. This subparagraph (W) | ||||||
21 | is exempt from the provisions of Section 250; and
| ||||||
22 | (X) An amount equal to the income from intangible | ||||||
23 | property taken into account for the taxable year (net | ||||||
24 | of the deductions allocable thereto) with respect to | ||||||
25 | transactions with (i) a foreign person who would be a | ||||||
26 | member of the taxpayer's unitary business group but for |
| |||||||
| |||||||
1 | the fact that the foreign person's business activity | ||||||
2 | outside the United States is 80% or more of that | ||||||
3 | person's total business activity and (ii) for taxable | ||||||
4 | years ending on or after December 31, 2008, to a person | ||||||
5 | who would be a member of the same unitary business | ||||||
6 | group but for the fact that the person is prohibited | ||||||
7 | under Section 1501(a)(27) from being included in the | ||||||
8 | unitary business group because he or she is ordinarily | ||||||
9 | required to apportion business income under different | ||||||
10 | subsections of Section 304, but not to exceed the | ||||||
11 | addition modification required to be made for the same | ||||||
12 | taxable year under Section 203(b)(2)(E-13) for | ||||||
13 | intangible expenses and costs paid, accrued, or | ||||||
14 | incurred, directly or indirectly, to the same foreign | ||||||
15 | person. This subparagraph (X) is exempt from the | ||||||
16 | provisions of Section 250.
(Y)
| ||||||
17 | (3) Special rule. For purposes of paragraph (2) (A), | ||||||
18 | "gross income"
in the case of a life insurance company, for | ||||||
19 | tax years ending on and after
December 31, 1994,
shall mean | ||||||
20 | the gross investment income for the taxable year.
| ||||||
21 | (c) Trusts and estates.
| ||||||
22 | (1) In general. In the case of a trust or estate, base | ||||||
23 | income means
an amount equal to the taxpayer's taxable | ||||||
24 | income for the taxable year as
modified by paragraph (2).
| ||||||
25 | (2) Modifications. Subject to the provisions of |
| |||||||
| |||||||
1 | paragraph (3), the
taxable income referred to in paragraph | ||||||
2 | (1) shall be modified by adding
thereto the sum of the | ||||||
3 | following amounts:
| ||||||
4 | (A) An amount equal to all amounts paid or accrued | ||||||
5 | to the taxpayer
as interest or dividends during the | ||||||
6 | taxable year to the extent excluded
from gross income | ||||||
7 | in the computation of taxable income;
| ||||||
8 | (B) In the case of (i) an estate, $600; (ii) a | ||||||
9 | trust which, under
its governing instrument, is | ||||||
10 | required to distribute all of its income
currently, | ||||||
11 | $300; and (iii) any other trust, $100, but in each such | ||||||
12 | case,
only to the extent such amount was deducted in | ||||||
13 | the computation of
taxable income;
| ||||||
14 | (C) An amount equal to the amount of tax imposed by | ||||||
15 | this Act to the
extent deducted from gross income in | ||||||
16 | the computation of taxable income
for the taxable year;
| ||||||
17 | (D) The amount of any net operating loss deduction | ||||||
18 | taken in arriving at
taxable income, other than a net | ||||||
19 | operating loss carried forward from a
taxable year | ||||||
20 | ending prior to December 31, 1986;
| ||||||
21 | (E) For taxable years in which a net operating loss | ||||||
22 | carryback or
carryforward from a taxable year ending | ||||||
23 | prior to December 31, 1986 is an
element of taxable | ||||||
24 | income under paragraph (1) of subsection (e) or | ||||||
25 | subparagraph
(E) of paragraph (2) of subsection (e), | ||||||
26 | the amount by which addition
modifications other than |
| |||||||
| |||||||
1 | those provided by this subparagraph (E) exceeded
| ||||||
2 | subtraction modifications in such taxable year, with | ||||||
3 | the following limitations
applied in the order that | ||||||
4 | they are listed:
| ||||||
5 | (i) the addition modification relating to the | ||||||
6 | net operating loss
carried back or forward to the | ||||||
7 | taxable year from any taxable year ending
prior to | ||||||
8 | December 31, 1986 shall be reduced by the amount of | ||||||
9 | addition
modification under this subparagraph (E) | ||||||
10 | which related to that net
operating loss and which | ||||||
11 | was taken into account in calculating the base
| ||||||
12 | income of an earlier taxable year, and
| ||||||
13 | (ii) the addition modification relating to the | ||||||
14 | net operating loss
carried back or forward to the | ||||||
15 | taxable year from any taxable year ending
prior to | ||||||
16 | December 31, 1986 shall not exceed the amount of | ||||||
17 | such carryback or
carryforward;
| ||||||
18 | For taxable years in which there is a net operating | ||||||
19 | loss carryback or
carryforward from more than one other | ||||||
20 | taxable year ending prior to December
31, 1986, the | ||||||
21 | addition modification provided in this subparagraph | ||||||
22 | (E) shall
be the sum of the amounts computed | ||||||
23 | independently under the preceding
provisions of this | ||||||
24 | subparagraph (E) for each such taxable year;
| ||||||
25 | (F) For taxable years ending on or after January 1, | ||||||
26 | 1989, an amount
equal to the tax deducted pursuant to |
| |||||||
| |||||||
1 | Section 164 of the Internal Revenue
Code if the trust | ||||||
2 | or estate is claiming the same tax for purposes of the
| ||||||
3 | Illinois foreign tax credit under Section 601 of this | ||||||
4 | Act;
| ||||||
5 | (G) An amount equal to the amount of the capital | ||||||
6 | gain deduction
allowable under the Internal Revenue | ||||||
7 | Code, to the extent deducted from
gross income in the | ||||||
8 | computation of taxable income;
| ||||||
9 | (G-5) For taxable years ending after December 31, | ||||||
10 | 1997, an
amount equal to any eligible remediation costs | ||||||
11 | that the trust or estate
deducted in computing adjusted | ||||||
12 | gross income and for which the trust
or estate claims a | ||||||
13 | credit under subsection (l) of Section 201;
| ||||||
14 | (G-10) For taxable years 2001 and thereafter, an | ||||||
15 | amount equal to the
bonus depreciation deduction taken | ||||||
16 | on the taxpayer's federal income tax return for the | ||||||
17 | taxable
year under subsection (k) of Section 168 of the | ||||||
18 | Internal Revenue Code; and
| ||||||
19 | (G-11) If the taxpayer sells, transfers, abandons, | ||||||
20 | or otherwise disposes of property for which the | ||||||
21 | taxpayer was required in any taxable year to
make an | ||||||
22 | addition modification under subparagraph (G-10), then | ||||||
23 | an amount equal
to the aggregate amount of the | ||||||
24 | deductions taken in all taxable
years under | ||||||
25 | subparagraph (R) with respect to that property.
| ||||||
26 | If the taxpayer continues to own property through |
| |||||||
| |||||||
1 | the last day of the last tax year for which the | ||||||
2 | taxpayer may claim a depreciation deduction for | ||||||
3 | federal income tax purposes and for which the taxpayer | ||||||
4 | was allowed in any taxable year to make a subtraction | ||||||
5 | modification under subparagraph (R), then an amount | ||||||
6 | equal to that subtraction modification.
| ||||||
7 | The taxpayer is required to make the addition | ||||||
8 | modification under this
subparagraph
only once with | ||||||
9 | respect to any one piece of property;
| ||||||
10 | (G-12) An amount equal to the amount otherwise | ||||||
11 | allowed as a deduction in computing base income for | ||||||
12 | interest paid, accrued, or incurred, directly or | ||||||
13 | indirectly, (i) for taxable years ending on or after | ||||||
14 | December 31, 2004, to a foreign person who would be a | ||||||
15 | member of the same unitary business group but for the | ||||||
16 | fact that the foreign person's business activity | ||||||
17 | outside the United States is 80% or more of the foreign | ||||||
18 | person's total business activity and (ii) for taxable | ||||||
19 | years ending on or after December 31, 2008, to a person | ||||||
20 | who would be a member of the same unitary business | ||||||
21 | group but for the fact that the person is prohibited | ||||||
22 | under Section 1501(a)(27) from being included in the | ||||||
23 | unitary business group because he or she is ordinarily | ||||||
24 | required to apportion business income under different | ||||||
25 | subsections of Section 304. The addition modification | ||||||
26 | required by this subparagraph shall be reduced to the |
| |||||||
| |||||||
1 | extent that dividends were included in base income of | ||||||
2 | the unitary group for the same taxable year and | ||||||
3 | received by the taxpayer or by a member of the | ||||||
4 | taxpayer's unitary business group (including amounts | ||||||
5 | included in gross income pursuant to Sections 951 | ||||||
6 | through 964 of the Internal Revenue Code and amounts | ||||||
7 | included in gross income under Section 78 of the | ||||||
8 | Internal Revenue Code) with respect to the stock of the | ||||||
9 | same person to whom the interest was paid, accrued, or | ||||||
10 | incurred.
| ||||||
11 | This paragraph shall not apply to the following:
| ||||||
12 | (i) an item of interest paid, accrued, or | ||||||
13 | incurred, directly or indirectly, to a person who | ||||||
14 | is subject in a foreign country or state, other | ||||||
15 | than a state which requires mandatory unitary | ||||||
16 | reporting, to a tax on or measured by net income | ||||||
17 | with respect to such interest; or | ||||||
18 | (ii) an item of interest paid, accrued, or | ||||||
19 | incurred, directly or indirectly, to a person if | ||||||
20 | the taxpayer can establish, based on a | ||||||
21 | preponderance of the evidence, both of the | ||||||
22 | following: | ||||||
23 | (a) the person, during the same taxable | ||||||
24 | year, paid, accrued, or incurred, the interest | ||||||
25 | to a person that is not a related member, and | ||||||
26 | (b) the transaction giving rise to the |
| |||||||
| |||||||
1 | interest expense between the taxpayer and the | ||||||
2 | person did not have as a principal purpose the | ||||||
3 | avoidance of Illinois income tax, and is paid | ||||||
4 | pursuant to a contract or agreement that | ||||||
5 | reflects an arm's-length interest rate and | ||||||
6 | terms; or
| ||||||
7 | (iii) the taxpayer can establish, based on | ||||||
8 | clear and convincing evidence, that the interest | ||||||
9 | paid, accrued, or incurred relates to a contract or | ||||||
10 | agreement entered into at arm's-length rates and | ||||||
11 | terms and the principal purpose for the payment is | ||||||
12 | not federal or Illinois tax avoidance; or
| ||||||
13 | (iv) an item of interest paid, accrued, or | ||||||
14 | incurred, directly or indirectly, to a person if | ||||||
15 | the taxpayer establishes by clear and convincing | ||||||
16 | evidence that the adjustments are unreasonable; or | ||||||
17 | if the taxpayer and the Director agree in writing | ||||||
18 | to the application or use of an alternative method | ||||||
19 | of apportionment under Section 304(f).
| ||||||
20 | Nothing in this subsection shall preclude the | ||||||
21 | Director from making any other adjustment | ||||||
22 | otherwise allowed under Section 404 of this Act for | ||||||
23 | any tax year beginning after the effective date of | ||||||
24 | this amendment provided such adjustment is made | ||||||
25 | pursuant to regulation adopted by the Department | ||||||
26 | and such regulations provide methods and standards |
| |||||||
| |||||||
1 | by which the Department will utilize its authority | ||||||
2 | under Section 404 of this Act;
| ||||||
3 | (G-13) An amount equal to the amount of intangible | ||||||
4 | expenses and costs otherwise allowed as a deduction in | ||||||
5 | computing base income, and that were paid, accrued, or | ||||||
6 | incurred, directly or indirectly, (i) for taxable | ||||||
7 | years ending on or after December 31, 2004, to a | ||||||
8 | foreign person who would be a member of the same | ||||||
9 | unitary business group but for the fact that the | ||||||
10 | foreign person's business activity outside the United | ||||||
11 | States is 80% or more of that person's total business | ||||||
12 | activity and (ii) for taxable years ending on or after | ||||||
13 | December 31, 2008, to a person who would be a member of | ||||||
14 | the same unitary business group but for the fact that | ||||||
15 | the person is prohibited under Section 1501(a)(27) | ||||||
16 | from being included in the unitary business group | ||||||
17 | because he or she is ordinarily required to apportion | ||||||
18 | business income under different subsections of Section | ||||||
19 | 304. The addition modification required by this | ||||||
20 | subparagraph shall be reduced to the extent that | ||||||
21 | dividends were included in base income of the unitary | ||||||
22 | group for the same taxable year and received by the | ||||||
23 | taxpayer or by a member of the taxpayer's unitary | ||||||
24 | business group (including amounts included in gross | ||||||
25 | income pursuant to Sections 951 through 964 of the | ||||||
26 | Internal Revenue Code and amounts included in gross |
| |||||||
| |||||||
1 | income under Section 78 of the Internal Revenue Code) | ||||||
2 | with respect to the stock of the same person to whom | ||||||
3 | the intangible expenses and costs were directly or | ||||||
4 | indirectly paid, incurred, or accrued. The preceding | ||||||
5 | sentence shall not apply to the extent that the same | ||||||
6 | dividends caused a reduction to the addition | ||||||
7 | modification required under Section 203(c)(2)(G-12) of | ||||||
8 | this Act. As used in this subparagraph, the term | ||||||
9 | "intangible expenses and costs" includes: (1) | ||||||
10 | expenses, losses, and costs for or related to the | ||||||
11 | direct or indirect acquisition, use, maintenance or | ||||||
12 | management, ownership, sale, exchange, or any other | ||||||
13 | disposition of intangible property; (2) losses | ||||||
14 | incurred, directly or indirectly, from factoring | ||||||
15 | transactions or discounting transactions; (3) royalty, | ||||||
16 | patent, technical, and copyright fees; (4) licensing | ||||||
17 | fees; and (5) other similar expenses and costs. For | ||||||
18 | purposes of this subparagraph, "intangible property" | ||||||
19 | includes patents, patent applications, trade names, | ||||||
20 | trademarks, service marks, copyrights, mask works, | ||||||
21 | trade secrets, and similar types of intangible assets. | ||||||
22 | This paragraph shall not apply to the following: | ||||||
23 | (i) any item of intangible expenses or costs | ||||||
24 | paid, accrued, or incurred, directly or | ||||||
25 | indirectly, from a transaction with a person who is | ||||||
26 | subject in a foreign country or state, other than a |
| |||||||
| |||||||
1 | state which requires mandatory unitary reporting, | ||||||
2 | to a tax on or measured by net income with respect | ||||||
3 | to such item; or | ||||||
4 | (ii) any item of intangible expense or cost | ||||||
5 | paid, accrued, or incurred, directly or | ||||||
6 | indirectly, if the taxpayer can establish, based | ||||||
7 | on a preponderance of the evidence, both of the | ||||||
8 | following: | ||||||
9 | (a) the person during the same taxable | ||||||
10 | year paid, accrued, or incurred, the | ||||||
11 | intangible expense or cost to a person that is | ||||||
12 | not a related member, and | ||||||
13 | (b) the transaction giving rise to the | ||||||
14 | intangible expense or cost between the | ||||||
15 | taxpayer and the person did not have as a | ||||||
16 | principal purpose the avoidance of Illinois | ||||||
17 | income tax, and is paid pursuant to a contract | ||||||
18 | or agreement that reflects arm's-length terms; | ||||||
19 | or | ||||||
20 | (iii) any item of intangible expense or cost | ||||||
21 | paid, accrued, or incurred, directly or | ||||||
22 | indirectly, from a transaction with a person if the | ||||||
23 | taxpayer establishes by clear and convincing | ||||||
24 | evidence, that the adjustments are unreasonable; | ||||||
25 | or if the taxpayer and the Director agree in | ||||||
26 | writing to the application or use of an alternative |
| |||||||
| |||||||
1 | method of apportionment under Section 304(f);
| ||||||
2 | Nothing in this subsection shall preclude the | ||||||
3 | Director from making any other adjustment | ||||||
4 | otherwise allowed under Section 404 of this Act for | ||||||
5 | any tax year beginning after the effective date of | ||||||
6 | this amendment provided such adjustment is made | ||||||
7 | pursuant to regulation adopted by the Department | ||||||
8 | and such regulations provide methods and standards | ||||||
9 | by which the Department will utilize its authority | ||||||
10 | under Section 404 of this Act;
| ||||||
11 | (G-14) For taxable years ending on or after | ||||||
12 | December 31, 2008, an amount equal to the amount of | ||||||
13 | insurance premium expenses and costs otherwise allowed | ||||||
14 | as a deduction in computing base income, and that were | ||||||
15 | paid, accrued, or incurred, directly or indirectly, to | ||||||
16 | a person who would be a member of the same unitary | ||||||
17 | business group but for the fact that the person is | ||||||
18 | prohibited under Section 1501(a)(27) from being | ||||||
19 | included in the unitary business group because he or | ||||||
20 | she is ordinarily required to apportion business | ||||||
21 | income under different subsections of Section 304. The | ||||||
22 | addition modification required by this subparagraph | ||||||
23 | shall be reduced to the extent that dividends were | ||||||
24 | included in base income of the unitary group for the | ||||||
25 | same taxable year and received by the taxpayer or by a | ||||||
26 | member of the taxpayer's unitary business group |
| |||||||
| |||||||
1 | (including amounts included in gross income under | ||||||
2 | Sections 951 through 964 of the Internal Revenue Code | ||||||
3 | and amounts included in gross income under Section 78 | ||||||
4 | of the Internal Revenue Code) with respect to the stock | ||||||
5 | of the same person to whom the premiums and costs were | ||||||
6 | directly or indirectly paid, incurred, or accrued. The | ||||||
7 | preceding sentence does not apply to the extent that | ||||||
8 | the same dividends caused a reduction to the addition | ||||||
9 | modification required under Section 203(c)(2)(G-12) or | ||||||
10 | Section 203(c)(2)(G-13) of this Act.
| ||||||
11 | and by deducting from the total so obtained the sum of the | ||||||
12 | following
amounts:
| ||||||
13 | (H) An amount equal to all amounts included in such | ||||||
14 | total pursuant
to the provisions of Sections 402(a), | ||||||
15 | 402(c), 403(a), 403(b), 406(a), 407(a)
and 408 of the | ||||||
16 | Internal Revenue Code or included in such total as
| ||||||
17 | distributions under the provisions of any retirement | ||||||
18 | or disability plan for
employees of any governmental | ||||||
19 | agency or unit, or retirement payments to
retired | ||||||
20 | partners, which payments are excluded in computing net | ||||||
21 | earnings
from self employment by Section 1402 of the | ||||||
22 | Internal Revenue Code and
regulations adopted pursuant | ||||||
23 | thereto;
| ||||||
24 | (I) The valuation limitation amount;
| ||||||
25 | (J) An amount equal to the amount of any tax | ||||||
26 | imposed by this Act
which was refunded to the taxpayer |
| |||||||
| |||||||
1 | and included in such total for the
taxable year;
| ||||||
2 | (K) An amount equal to all amounts included in | ||||||
3 | taxable income as
modified by subparagraphs (A), (B), | ||||||
4 | (C), (D), (E), (F) and (G) which
are exempt from | ||||||
5 | taxation by this State either by reason of its statutes | ||||||
6 | or
Constitution
or by reason of the Constitution, | ||||||
7 | treaties or statutes of the United States;
provided | ||||||
8 | that, in the case of any statute of this State that | ||||||
9 | exempts income
derived from bonds or other obligations | ||||||
10 | from the tax imposed under this Act,
the amount | ||||||
11 | exempted shall be the interest net of bond premium | ||||||
12 | amortization;
| ||||||
13 | (L) With the exception of any amounts subtracted | ||||||
14 | under subparagraph
(K),
an amount equal to the sum of | ||||||
15 | all amounts disallowed as
deductions by (i) Sections | ||||||
16 | 171(a) (2) and 265(a)(2) of the Internal Revenue
Code, | ||||||
17 | as now or hereafter amended, and all amounts of | ||||||
18 | expenses allocable
to interest and disallowed as | ||||||
19 | deductions by Section 265(1) of the Internal
Revenue | ||||||
20 | Code of 1954, as now or hereafter amended;
and (ii) for | ||||||
21 | taxable years
ending on or after August 13, 1999, | ||||||
22 | Sections
171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of | ||||||
23 | the Internal Revenue Code; the provisions of this
| ||||||
24 | subparagraph are exempt from the provisions of Section | ||||||
25 | 250;
| ||||||
26 | (M) An amount equal to those dividends included in |
| |||||||
| |||||||
1 | such total
which were paid by a corporation which | ||||||
2 | conducts business operations in an
Enterprise Zone or | ||||||
3 | zones created under the Illinois Enterprise Zone Act or | ||||||
4 | a River Edge Redevelopment Zone or zones created under | ||||||
5 | the River Edge Redevelopment Zone Act and
conducts | ||||||
6 | substantially all of its operations in an Enterprise | ||||||
7 | Zone or Zones or a River Edge Redevelopment Zone or | ||||||
8 | zones. This subparagraph (M) is exempt from the | ||||||
9 | provisions of Section 250;
| ||||||
10 | (N) An amount equal to any contribution made to a | ||||||
11 | job training
project established pursuant to the Tax | ||||||
12 | Increment Allocation
Redevelopment Act;
| ||||||
13 | (O) An amount equal to those dividends included in | ||||||
14 | such total
that were paid by a corporation that | ||||||
15 | conducts business operations in a
federally designated | ||||||
16 | Foreign Trade Zone or Sub-Zone and that is designated
a | ||||||
17 | High Impact Business located in Illinois; provided | ||||||
18 | that dividends eligible
for the deduction provided in | ||||||
19 | subparagraph (M) of paragraph (2) of this
subsection | ||||||
20 | shall not be eligible for the deduction provided under | ||||||
21 | this
subparagraph (O);
| ||||||
22 | (P) An amount equal to the amount of the deduction | ||||||
23 | used to compute the
federal income tax credit for | ||||||
24 | restoration of substantial amounts held under
claim of | ||||||
25 | right for the taxable year pursuant to Section 1341 of | ||||||
26 | the
Internal Revenue Code of 1986;
|
| |||||||
| |||||||
1 | (Q) For taxable year 1999 and thereafter, an amount | ||||||
2 | equal to the
amount of any
(i) distributions, to the | ||||||
3 | extent includible in gross income for
federal income | ||||||
4 | tax purposes, made to the taxpayer because of
his or | ||||||
5 | her status as a victim of
persecution for racial or | ||||||
6 | religious reasons by Nazi Germany or any other Axis
| ||||||
7 | regime or as an heir of the victim and (ii) items
of | ||||||
8 | income, to the extent
includible in gross income for | ||||||
9 | federal income tax purposes, attributable to,
derived | ||||||
10 | from or in any way related to assets stolen from, | ||||||
11 | hidden from, or
otherwise lost to a victim of
| ||||||
12 | persecution for racial or religious reasons by Nazi
| ||||||
13 | Germany or any other Axis regime
immediately prior to, | ||||||
14 | during, and immediately after World War II, including,
| ||||||
15 | but
not limited to, interest on the proceeds receivable | ||||||
16 | as insurance
under policies issued to a victim of | ||||||
17 | persecution for racial or religious
reasons by Nazi | ||||||
18 | Germany or any other Axis regime by European insurance
| ||||||
19 | companies
immediately prior to and during World War II;
| ||||||
20 | provided, however, this subtraction from federal | ||||||
21 | adjusted gross income does not
apply to assets acquired | ||||||
22 | with such assets or with the proceeds from the sale of
| ||||||
23 | such assets; provided, further, this paragraph shall | ||||||
24 | only apply to a taxpayer
who was the first recipient of | ||||||
25 | such assets after their recovery and who is a
victim of
| ||||||
26 | persecution for racial or religious reasons
by Nazi |
| |||||||
| |||||||
1 | Germany or any other Axis regime or as an heir of the | ||||||
2 | victim. The
amount of and the eligibility for any | ||||||
3 | public assistance, benefit, or
similar entitlement is | ||||||
4 | not affected by the inclusion of items (i) and (ii) of
| ||||||
5 | this paragraph in gross income for federal income tax | ||||||
6 | purposes.
This paragraph is exempt from the provisions | ||||||
7 | of Section 250;
| ||||||
8 | (R) For taxable years 2001 and thereafter, for the | ||||||
9 | taxable year in
which the bonus depreciation deduction
| ||||||
10 | is taken on the taxpayer's federal income tax return | ||||||
11 | under
subsection (k) of Section 168 of the Internal | ||||||
12 | Revenue Code and for each
applicable taxable year | ||||||
13 | thereafter, an amount equal to "x", where:
| ||||||
14 | (1) "y" equals the amount of the depreciation | ||||||
15 | deduction taken for the
taxable year
on the | ||||||
16 | taxpayer's federal income tax return on property | ||||||
17 | for which the bonus
depreciation deduction
was | ||||||
18 | taken in any year under subsection (k) of Section | ||||||
19 | 168 of the Internal
Revenue Code, but not including | ||||||
20 | the bonus depreciation deduction;
| ||||||
21 | (2) for taxable years ending on or before | ||||||
22 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
23 | and then divided by 70 (or "y"
multiplied by | ||||||
24 | 0.429); and | ||||||
25 | (3) for taxable years ending after December | ||||||
26 | 31, 2005: |
| |||||||
| |||||||
1 | (i) for property on which a bonus | ||||||
2 | depreciation deduction of 30% of the adjusted | ||||||
3 | basis was taken, "x" equals "y" multiplied by | ||||||
4 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
5 | 0.429); and | ||||||
6 | (ii) for property on which a bonus | ||||||
7 | depreciation deduction of 50% of the adjusted | ||||||
8 | basis was taken, "x" equals "y" multiplied by | ||||||
9 | 1.0.
| ||||||
10 | The aggregate amount deducted under this | ||||||
11 | subparagraph in all taxable
years for any one piece of | ||||||
12 | property may not exceed the amount of the bonus
| ||||||
13 | depreciation deduction
taken on that property on the | ||||||
14 | taxpayer's federal income tax return under
subsection | ||||||
15 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
16 | subparagraph (R) is exempt from the provisions of | ||||||
17 | Section 250;
| ||||||
18 | (S) If the taxpayer sells, transfers, abandons, or | ||||||
19 | otherwise disposes of
property for which the taxpayer | ||||||
20 | was required in any taxable year to make an
addition | ||||||
21 | modification under subparagraph (G-10), then an amount | ||||||
22 | equal to that
addition modification.
| ||||||
23 | If the taxpayer continues to own property through | ||||||
24 | the last day of the last tax year for which the | ||||||
25 | taxpayer may claim a depreciation deduction for | ||||||
26 | federal income tax purposes and for which the taxpayer |
| |||||||
| |||||||
1 | was required in any taxable year to make an addition | ||||||
2 | modification under subparagraph (G-10), then an amount | ||||||
3 | equal to that addition modification.
| ||||||
4 | The taxpayer is allowed to take the deduction under | ||||||
5 | this subparagraph
only once with respect to any one | ||||||
6 | piece of property. | ||||||
7 | This subparagraph (S) is exempt from the | ||||||
8 | provisions of Section 250;
| ||||||
9 | (T) The amount of (i) any interest income (net of | ||||||
10 | the deductions allocable thereto) taken into account | ||||||
11 | for the taxable year with respect to a transaction with | ||||||
12 | a taxpayer that is required to make an addition | ||||||
13 | modification with respect to such transaction under | ||||||
14 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
15 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
16 | the amount of such addition modification and
(ii) any | ||||||
17 | income from intangible property (net of the deductions | ||||||
18 | allocable thereto) taken into account for the taxable | ||||||
19 | year with respect to a transaction with a taxpayer that | ||||||
20 | is required to make an addition modification with | ||||||
21 | respect to such transaction under Section | ||||||
22 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
23 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
24 | addition modification. This subparagraph (T) is exempt | ||||||
25 | from the provisions of Section 250;
| ||||||
26 | (U) An amount equal to the interest income taken |
| |||||||
| |||||||
1 | into account for the taxable year (net of the | ||||||
2 | deductions allocable thereto) with respect to | ||||||
3 | transactions with (i) a foreign person who would be a | ||||||
4 | member of the taxpayer's unitary business group but for | ||||||
5 | the fact the foreign person's business activity | ||||||
6 | outside the United States is 80% or more of that | ||||||
7 | person's total business activity and (ii) for taxable | ||||||
8 | years ending on or after December 31, 2008, to a person | ||||||
9 | who would be a member of the same unitary business | ||||||
10 | group but for the fact that the person is prohibited | ||||||
11 | under Section 1501(a)(27) from being included in the | ||||||
12 | unitary business group because he or she is ordinarily | ||||||
13 | required to apportion business income under different | ||||||
14 | subsections of Section 304, but not to exceed the | ||||||
15 | addition modification required to be made for the same | ||||||
16 | taxable year under Section 203(c)(2)(G-12) for | ||||||
17 | interest paid, accrued, or incurred, directly or | ||||||
18 | indirectly, to the same person. This subparagraph (U) | ||||||
19 | is exempt from the provisions of Section 250; and | ||||||
20 | (V) An amount equal to the income from intangible | ||||||
21 | property taken into account for the taxable year (net | ||||||
22 | of the deductions allocable thereto) with respect to | ||||||
23 | transactions with (i) a foreign person who would be a | ||||||
24 | member of the taxpayer's unitary business group but for | ||||||
25 | the fact that the foreign person's business activity | ||||||
26 | outside the United States is 80% or more of that |
| |||||||
| |||||||
1 | person's total business activity and (ii) for taxable | ||||||
2 | years ending on or after December 31, 2008, to a person | ||||||
3 | who would be a member of the same unitary business | ||||||
4 | group but for the fact that the person is prohibited | ||||||
5 | under Section 1501(a)(27) from being included in the | ||||||
6 | unitary business group because he or she is ordinarily | ||||||
7 | required to apportion business income under different | ||||||
8 | subsections of Section 304, but not to exceed the | ||||||
9 | addition modification required to be made for the same | ||||||
10 | taxable year under Section 203(c)(2)(G-13) for | ||||||
11 | intangible expenses and costs paid, accrued, or | ||||||
12 | incurred, directly or indirectly, to the same foreign | ||||||
13 | person. This subparagraph (V) is exempt from the | ||||||
14 | provisions of Section 250.
(W)
| ||||||
15 | (3) Limitation. The amount of any modification | ||||||
16 | otherwise required
under this subsection shall, under | ||||||
17 | regulations prescribed by the
Department, be adjusted by | ||||||
18 | any amounts included therein which were
properly paid, | ||||||
19 | credited, or required to be distributed, or permanently set
| ||||||
20 | aside for charitable purposes pursuant to Internal Revenue | ||||||
21 | Code Section
642(c) during the taxable year.
| ||||||
22 | (d) Partnerships.
| ||||||
23 | (1) In general. In the case of a partnership, base | ||||||
24 | income means an
amount equal to the taxpayer's taxable | ||||||
25 | income for the taxable year as
modified by paragraph (2).
|
| |||||||
| |||||||
1 | (2) Modifications. The taxable income referred to in | ||||||
2 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
3 | of the following amounts:
| ||||||
4 | (A) An amount equal to all amounts paid or accrued | ||||||
5 | to the taxpayer as
interest or dividends during the | ||||||
6 | taxable year to the extent excluded from
gross income | ||||||
7 | in the computation of taxable income;
| ||||||
8 | (B) An amount equal to the amount of tax imposed by | ||||||
9 | this Act to the
extent deducted from gross income for | ||||||
10 | the taxable year;
| ||||||
11 | (C) The amount of deductions allowed to the | ||||||
12 | partnership pursuant to
Section 707 (c) of the Internal | ||||||
13 | Revenue Code in calculating its taxable income;
| ||||||
14 | (D) An amount equal to the amount of the capital | ||||||
15 | gain deduction
allowable under the Internal Revenue | ||||||
16 | Code, to the extent deducted from
gross income in the | ||||||
17 | computation of taxable income;
| ||||||
18 | (D-5) For taxable years 2001 and thereafter, an | ||||||
19 | amount equal to the
bonus depreciation deduction taken | ||||||
20 | on the taxpayer's federal income tax return for the | ||||||
21 | taxable
year under subsection (k) of Section 168 of the | ||||||
22 | Internal Revenue Code;
| ||||||
23 | (D-6) If the taxpayer sells, transfers, abandons, | ||||||
24 | or otherwise disposes of
property for which the | ||||||
25 | taxpayer was required in any taxable year to make an
| ||||||
26 | addition modification under subparagraph (D-5), then |
| |||||||
| |||||||
1 | an amount equal to the
aggregate amount of the | ||||||
2 | deductions taken in all taxable years
under | ||||||
3 | subparagraph (O) with respect to that property.
| ||||||
4 | If the taxpayer continues to own property through | ||||||
5 | the last day of the last tax year for which the | ||||||
6 | taxpayer may claim a depreciation deduction for | ||||||
7 | federal income tax purposes and for which the taxpayer | ||||||
8 | was allowed in any taxable year to make a subtraction | ||||||
9 | modification under subparagraph (O), then an amount | ||||||
10 | equal to that subtraction modification.
| ||||||
11 | The taxpayer is required to make the addition | ||||||
12 | modification under this
subparagraph
only once with | ||||||
13 | respect to any one piece of property;
| ||||||
14 | (D-7) An amount equal to the amount otherwise | ||||||
15 | allowed as a deduction in computing base income for | ||||||
16 | interest paid, accrued, or incurred, directly or | ||||||
17 | indirectly, (i) for taxable years ending on or after | ||||||
18 | December 31, 2004, to a foreign person who would be a | ||||||
19 | member of the same unitary business group but for the | ||||||
20 | fact the foreign person's business activity outside | ||||||
21 | the United States is 80% or more of the foreign | ||||||
22 | person's total business activity and (ii) for taxable | ||||||
23 | years ending on or after December 31, 2008, to a person | ||||||
24 | who would be a member of the same unitary business | ||||||
25 | group but for the fact that the person is prohibited | ||||||
26 | under Section 1501(a)(27) from being included in the |
| |||||||
| |||||||
1 | unitary business group because he or she is ordinarily | ||||||
2 | required to apportion business income under different | ||||||
3 | subsections of Section 304. The addition modification | ||||||
4 | required by this subparagraph shall be reduced to the | ||||||
5 | extent that dividends were included in base income of | ||||||
6 | the unitary group for the same taxable year and | ||||||
7 | received by the taxpayer or by a member of the | ||||||
8 | taxpayer's unitary business group (including amounts | ||||||
9 | included in gross income pursuant to Sections 951 | ||||||
10 | through 964 of the Internal Revenue Code and amounts | ||||||
11 | included in gross income under Section 78 of the | ||||||
12 | Internal Revenue Code) with respect to the stock of the | ||||||
13 | same person to whom the interest was paid, accrued, or | ||||||
14 | incurred.
| ||||||
15 | This paragraph shall not apply to the following:
| ||||||
16 | (i) an item of interest paid, accrued, or | ||||||
17 | incurred, directly or indirectly, to a person who | ||||||
18 | is subject in a foreign country or state, other | ||||||
19 | than a state which requires mandatory unitary | ||||||
20 | reporting, to a tax on or measured by net income | ||||||
21 | with respect to such interest; or | ||||||
22 | (ii) an item of interest paid, accrued, or | ||||||
23 | incurred, directly or indirectly, to a person if | ||||||
24 | the taxpayer can establish, based on a | ||||||
25 | preponderance of the evidence, both of the | ||||||
26 | following: |
| |||||||
| |||||||
1 | (a) the person, during the same taxable | ||||||
2 | year, paid, accrued, or incurred, the interest | ||||||
3 | to a person that is not a related member, and | ||||||
4 | (b) the transaction giving rise to the | ||||||
5 | interest expense between the taxpayer and the | ||||||
6 | person did not have as a principal purpose the | ||||||
7 | avoidance of Illinois income tax, and is paid | ||||||
8 | pursuant to a contract or agreement that | ||||||
9 | reflects an arm's-length interest rate and | ||||||
10 | terms; or
| ||||||
11 | (iii) the taxpayer can establish, based on | ||||||
12 | clear and convincing evidence, that the interest | ||||||
13 | paid, accrued, or incurred relates to a contract or | ||||||
14 | agreement entered into at arm's-length rates and | ||||||
15 | terms and the principal purpose for the payment is | ||||||
16 | not federal or Illinois tax avoidance; or
| ||||||
17 | (iv) an item of interest paid, accrued, or | ||||||
18 | incurred, directly or indirectly, to a person if | ||||||
19 | the taxpayer establishes by clear and convincing | ||||||
20 | evidence that the adjustments are unreasonable; or | ||||||
21 | if the taxpayer and the Director agree in writing | ||||||
22 | to the application or use of an alternative method | ||||||
23 | of apportionment under Section 304(f).
| ||||||
24 | Nothing in this subsection shall preclude the | ||||||
25 | Director from making any other adjustment | ||||||
26 | otherwise allowed under Section 404 of this Act for |
| |||||||
| |||||||
1 | any tax year beginning after the effective date of | ||||||
2 | this amendment provided such adjustment is made | ||||||
3 | pursuant to regulation adopted by the Department | ||||||
4 | and such regulations provide methods and standards | ||||||
5 | by which the Department will utilize its authority | ||||||
6 | under Section 404 of this Act; and
| ||||||
7 | (D-8) An amount equal to the amount of intangible | ||||||
8 | expenses and costs otherwise allowed as a deduction in | ||||||
9 | computing base income, and that were paid, accrued, or | ||||||
10 | incurred, directly or indirectly, (i) for taxable | ||||||
11 | years ending on or after December 31, 2004, to a | ||||||
12 | foreign person who would be a member of the same | ||||||
13 | unitary business group but for the fact that the | ||||||
14 | foreign person's business activity outside the United | ||||||
15 | States is 80% or more of that person's total business | ||||||
16 | activity and (ii) for taxable years ending on or after | ||||||
17 | December 31, 2008, to a person who would be a member of | ||||||
18 | the same unitary business group but for the fact that | ||||||
19 | the person is prohibited under Section 1501(a)(27) | ||||||
20 | from being included in the unitary business group | ||||||
21 | because he or she is ordinarily required to apportion | ||||||
22 | business income under different subsections of Section | ||||||
23 | 304. The addition modification required by this | ||||||
24 | subparagraph shall be reduced to the extent that | ||||||
25 | dividends were included in base income of the unitary | ||||||
26 | group for the same taxable year and received by the |
| |||||||
| |||||||
1 | taxpayer or by a member of the taxpayer's unitary | ||||||
2 | business group (including amounts included in gross | ||||||
3 | income pursuant to Sections 951 through 964 of the | ||||||
4 | Internal Revenue Code and amounts included in gross | ||||||
5 | income under Section 78 of the Internal Revenue Code) | ||||||
6 | with respect to the stock of the same person to whom | ||||||
7 | the intangible expenses and costs were directly or | ||||||
8 | indirectly paid, incurred or accrued. The preceding | ||||||
9 | sentence shall not apply to the extent that the same | ||||||
10 | dividends caused a reduction to the addition | ||||||
11 | modification required under Section 203(d)(2)(D-7) of | ||||||
12 | this Act. As used in this subparagraph, the term | ||||||
13 | "intangible expenses and costs" includes (1) expenses, | ||||||
14 | losses, and costs for, or related to, the direct or | ||||||
15 | indirect acquisition, use, maintenance or management, | ||||||
16 | ownership, sale, exchange, or any other disposition of | ||||||
17 | intangible property; (2) losses incurred, directly or | ||||||
18 | indirectly, from factoring transactions or discounting | ||||||
19 | transactions; (3) royalty, patent, technical, and | ||||||
20 | copyright fees; (4) licensing fees; and (5) other | ||||||
21 | similar expenses and costs. For purposes of this | ||||||
22 | subparagraph, "intangible property" includes patents, | ||||||
23 | patent applications, trade names, trademarks, service | ||||||
24 | marks, copyrights, mask works, trade secrets, and | ||||||
25 | similar types of intangible assets; | ||||||
26 | This paragraph shall not apply to the following: |
| |||||||
| |||||||
1 | (i) any item of intangible expenses or costs | ||||||
2 | paid, accrued, or incurred, directly or | ||||||
3 | indirectly, from a transaction with a person who is | ||||||
4 | subject in a foreign country or state, other than a | ||||||
5 | state which requires mandatory unitary reporting, | ||||||
6 | to a tax on or measured by net income with respect | ||||||
7 | to such item; or | ||||||
8 | (ii) any item of intangible expense or cost | ||||||
9 | paid, accrued, or incurred, directly or | ||||||
10 | indirectly, if the taxpayer can establish, based | ||||||
11 | on a preponderance of the evidence, both of the | ||||||
12 | following: | ||||||
13 | (a) the person during the same taxable | ||||||
14 | year paid, accrued, or incurred, the | ||||||
15 | intangible expense or cost to a person that is | ||||||
16 | not a related member, and | ||||||
17 | (b) the transaction giving rise to the | ||||||
18 | intangible expense or cost between the | ||||||
19 | taxpayer and the person did not have as a | ||||||
20 | principal purpose the avoidance of Illinois | ||||||
21 | income tax, and is paid pursuant to a contract | ||||||
22 | or agreement that reflects arm's-length terms; | ||||||
23 | or | ||||||
24 | (iii) any item of intangible expense or cost | ||||||
25 | paid, accrued, or incurred, directly or | ||||||
26 | indirectly, from a transaction with a person if the |
| |||||||
| |||||||
1 | taxpayer establishes by clear and convincing | ||||||
2 | evidence, that the adjustments are unreasonable; | ||||||
3 | or if the taxpayer and the Director agree in | ||||||
4 | writing to the application or use of an alternative | ||||||
5 | method of apportionment under Section 304(f);
| ||||||
6 | Nothing in this subsection shall preclude the | ||||||
7 | Director from making any other adjustment | ||||||
8 | otherwise allowed under Section 404 of this Act for | ||||||
9 | any tax year beginning after the effective date of | ||||||
10 | this amendment provided such adjustment is made | ||||||
11 | pursuant to regulation adopted by the Department | ||||||
12 | and such regulations provide methods and standards | ||||||
13 | by which the Department will utilize its authority | ||||||
14 | under Section 404 of this Act;
| ||||||
15 | (D-9) For taxable years ending on or after December | ||||||
16 | 31, 2008, an amount equal to the amount of insurance | ||||||
17 | premium expenses and costs otherwise allowed as a | ||||||
18 | deduction in computing base income, and that were paid, | ||||||
19 | accrued, or incurred, directly or indirectly, to a | ||||||
20 | person who would be a member of the same unitary | ||||||
21 | business group but for the fact that the person is | ||||||
22 | prohibited under Section 1501(a)(27) from being | ||||||
23 | included in the unitary business group because he or | ||||||
24 | she is ordinarily required to apportion business | ||||||
25 | income under different subsections of Section 304. The | ||||||
26 | addition modification required by this subparagraph |
| |||||||
| |||||||
1 | shall be reduced to the extent that dividends were | ||||||
2 | included in base income of the unitary group for the | ||||||
3 | same taxable year and received by the taxpayer or by a | ||||||
4 | member of the taxpayer's unitary business group | ||||||
5 | (including amounts included in gross income under | ||||||
6 | Sections 951 through 964 of the Internal Revenue Code | ||||||
7 | and amounts included in gross income under Section 78 | ||||||
8 | of the Internal Revenue Code) with respect to the stock | ||||||
9 | of the same person to whom the premiums and costs were | ||||||
10 | directly or indirectly paid, incurred, or accrued. The | ||||||
11 | preceding sentence does not apply to the extent that | ||||||
12 | the same dividends caused a reduction to the addition | ||||||
13 | modification required under Section 203(d)(2)(D-7) or | ||||||
14 | Section 203(d)(2)(D-8) of this Act.
| ||||||
15 | and by deducting from the total so obtained the following | ||||||
16 | amounts:
| ||||||
17 | (E) The valuation limitation amount;
| ||||||
18 | (F) An amount equal to the amount of any tax | ||||||
19 | imposed by this Act which
was refunded to the taxpayer | ||||||
20 | and included in such total for the taxable year;
| ||||||
21 | (G) An amount equal to all amounts included in | ||||||
22 | taxable income as
modified by subparagraphs (A), (B), | ||||||
23 | (C) and (D) which are exempt from
taxation by this | ||||||
24 | State either by reason of its statutes or Constitution | ||||||
25 | or
by reason of
the Constitution, treaties or statutes | ||||||
26 | of the United States;
provided that, in the case of any |
| |||||||
| |||||||
1 | statute of this State that exempts income
derived from | ||||||
2 | bonds or other obligations from the tax imposed under | ||||||
3 | this Act,
the amount exempted shall be the interest net | ||||||
4 | of bond premium amortization;
| ||||||
5 | (H) Any income of the partnership which | ||||||
6 | constitutes personal service
income as defined in | ||||||
7 | Section 1348 (b) (1) of the Internal Revenue Code (as
| ||||||
8 | in effect December 31, 1981) or a reasonable allowance | ||||||
9 | for compensation
paid or accrued for services rendered | ||||||
10 | by partners to the partnership,
whichever is greater;
| ||||||
11 | (I) An amount equal to all amounts of income | ||||||
12 | distributable to an entity
subject to the Personal | ||||||
13 | Property Tax Replacement Income Tax imposed by
| ||||||
14 | subsections (c) and (d) of Section 201 of this Act | ||||||
15 | including amounts
distributable to organizations | ||||||
16 | exempt from federal income tax by reason of
Section | ||||||
17 | 501(a) of the Internal Revenue Code , provided that the | ||||||
18 | deduction under this subparagraph (I) shall not be | ||||||
19 | allowed to a publicly traded partnership under Section | ||||||
20 | 7704 of the Internal Revenue Code for any taxable year | ||||||
21 | ending on or after December 31, 2009 ;
| ||||||
22 | (J) With the exception of any amounts subtracted | ||||||
23 | under subparagraph
(G),
an amount equal to the sum of | ||||||
24 | all amounts disallowed as deductions
by (i) Sections | ||||||
25 | 171(a) (2), and 265(2) of the Internal Revenue Code of | ||||||
26 | 1954,
as now or hereafter amended, and all amounts of |
| |||||||
| |||||||
1 | expenses allocable to
interest and disallowed as | ||||||
2 | deductions by Section 265(1) of the Internal
Revenue | ||||||
3 | Code, as now or hereafter amended;
and (ii) for taxable | ||||||
4 | years
ending on or after August 13, 1999, Sections
| ||||||
5 | 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of the | ||||||
6 | Internal Revenue Code; the provisions of this
| ||||||
7 | subparagraph are exempt from the provisions of Section | ||||||
8 | 250;
| ||||||
9 | (K) An amount equal to those dividends included in | ||||||
10 | such total which were
paid by a corporation which | ||||||
11 | conducts business operations in an Enterprise
Zone or | ||||||
12 | zones created under the Illinois Enterprise Zone Act, | ||||||
13 | enacted by
the 82nd General Assembly, or a River Edge | ||||||
14 | Redevelopment Zone or zones created under the River | ||||||
15 | Edge Redevelopment Zone Act and
conducts substantially | ||||||
16 | all of its operations
in an Enterprise Zone or Zones or | ||||||
17 | from a River Edge Redevelopment Zone or zones. This | ||||||
18 | subparagraph (K) is exempt from the provisions of | ||||||
19 | Section 250;
| ||||||
20 | (L) An amount equal to any contribution made to a | ||||||
21 | job training project
established pursuant to the Real | ||||||
22 | Property Tax Increment Allocation
Redevelopment Act;
| ||||||
23 | (M) An amount equal to those dividends included in | ||||||
24 | such total
that were paid by a corporation that | ||||||
25 | conducts business operations in a
federally designated | ||||||
26 | Foreign Trade Zone or Sub-Zone and that is designated a
|
| |||||||
| |||||||
1 | High Impact Business located in Illinois; provided | ||||||
2 | that dividends eligible
for the deduction provided in | ||||||
3 | subparagraph (K) of paragraph (2) of this
subsection | ||||||
4 | shall not be eligible for the deduction provided under | ||||||
5 | this
subparagraph (M);
| ||||||
6 | (N) An amount equal to the amount of the deduction | ||||||
7 | used to compute the
federal income tax credit for | ||||||
8 | restoration of substantial amounts held under
claim of | ||||||
9 | right for the taxable year pursuant to Section 1341 of | ||||||
10 | the
Internal Revenue Code of 1986;
| ||||||
11 | (O) For taxable years 2001 and thereafter, for the | ||||||
12 | taxable year in
which the bonus depreciation deduction
| ||||||
13 | is taken on the taxpayer's federal income tax return | ||||||
14 | under
subsection (k) of Section 168 of the Internal | ||||||
15 | Revenue Code and for each
applicable taxable year | ||||||
16 | thereafter, an amount equal to "x", where:
| ||||||
17 | (1) "y" equals the amount of the depreciation | ||||||
18 | deduction taken for the
taxable year
on the | ||||||
19 | taxpayer's federal income tax return on property | ||||||
20 | for which the bonus
depreciation deduction
was | ||||||
21 | taken in any year under subsection (k) of Section | ||||||
22 | 168 of the Internal
Revenue Code, but not including | ||||||
23 | the bonus depreciation deduction;
| ||||||
24 | (2) for taxable years ending on or before | ||||||
25 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
26 | and then divided by 70 (or "y"
multiplied by |
| |||||||
| |||||||
1 | 0.429); and | ||||||
2 | (3) for taxable years ending after December | ||||||
3 | 31, 2005: | ||||||
4 | (i) for property on which a bonus | ||||||
5 | depreciation deduction of 30% of the adjusted | ||||||
6 | basis was taken, "x" equals "y" multiplied by | ||||||
7 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
8 | 0.429); and | ||||||
9 | (ii) for property on which a bonus | ||||||
10 | depreciation deduction of 50% of the adjusted | ||||||
11 | basis was taken, "x" equals "y" multiplied by | ||||||
12 | 1.0.
| ||||||
13 | The aggregate amount deducted under this | ||||||
14 | subparagraph in all taxable
years for any one piece of | ||||||
15 | property may not exceed the amount of the bonus
| ||||||
16 | depreciation deduction
taken on that property on the | ||||||
17 | taxpayer's federal income tax return under
subsection | ||||||
18 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
19 | subparagraph (O) is exempt from the provisions of | ||||||
20 | Section 250;
| ||||||
21 | (P) If the taxpayer sells, transfers, abandons, or | ||||||
22 | otherwise disposes of
property for which the taxpayer | ||||||
23 | was required in any taxable year to make an
addition | ||||||
24 | modification under subparagraph (D-5), then an amount | ||||||
25 | equal to that
addition modification.
| ||||||
26 | If the taxpayer continues to own property through |
| |||||||
| |||||||
1 | the last day of the last tax year for which the | ||||||
2 | taxpayer may claim a depreciation deduction for | ||||||
3 | federal income tax purposes and for which the taxpayer | ||||||
4 | was required in any taxable year to make an addition | ||||||
5 | modification under subparagraph (D-5), then an amount | ||||||
6 | equal to that addition modification.
| ||||||
7 | The taxpayer is allowed to take the deduction under | ||||||
8 | this subparagraph
only once with respect to any one | ||||||
9 | piece of property. | ||||||
10 | This subparagraph (P) is exempt from the | ||||||
11 | provisions of Section 250;
| ||||||
12 | (Q) The amount of (i) any interest income (net of | ||||||
13 | the deductions allocable thereto) taken into account | ||||||
14 | for the taxable year with respect to a transaction with | ||||||
15 | a taxpayer that is required to make an addition | ||||||
16 | modification with respect to such transaction under | ||||||
17 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
18 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
19 | the amount of such addition modification and
(ii) any | ||||||
20 | income from intangible property (net of the deductions | ||||||
21 | allocable thereto) taken into account for the taxable | ||||||
22 | year with respect to a transaction with a taxpayer that | ||||||
23 | is required to make an addition modification with | ||||||
24 | respect to such transaction under Section | ||||||
25 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
26 | 203(d)(2)(D-8), but not to exceed the amount of such |
| |||||||
| |||||||
1 | addition modification. This subparagraph (Q) is exempt | ||||||
2 | from Section 250;
| ||||||
3 | (R) An amount equal to the interest income taken | ||||||
4 | into account for the taxable year (net of the | ||||||
5 | deductions allocable thereto) with respect to | ||||||
6 | transactions with (i) a foreign person who would be a | ||||||
7 | member of the taxpayer's unitary business group but for | ||||||
8 | the fact that the foreign person's business activity | ||||||
9 | outside the United States is 80% or more of that | ||||||
10 | person's total business activity and (ii) for taxable | ||||||
11 | years ending on or after December 31, 2008, to a person | ||||||
12 | who would be a member of the same unitary business | ||||||
13 | group but for the fact that the person is prohibited | ||||||
14 | under Section 1501(a)(27) from being included in the | ||||||
15 | unitary business group because he or she is ordinarily | ||||||
16 | required to apportion business income under different | ||||||
17 | subsections of Section 304, but not to exceed the | ||||||
18 | addition modification required to be made for the same | ||||||
19 | taxable year under Section 203(d)(2)(D-7) for interest | ||||||
20 | paid, accrued, or incurred, directly or indirectly, to | ||||||
21 | the same person. This subparagraph (R) is exempt from | ||||||
22 | Section 250; and | ||||||
23 | (S) An amount equal to the income from intangible | ||||||
24 | property taken into account for the taxable year (net | ||||||
25 | of the deductions allocable thereto) with respect to | ||||||
26 | transactions with (i) a foreign person who would be a |
| |||||||
| |||||||
1 | member of the taxpayer's unitary business group but for | ||||||
2 | the fact that the foreign person's business activity | ||||||
3 | outside the United States is 80% or more of that | ||||||
4 | person's total business activity and (ii) for taxable | ||||||
5 | years ending on or after December 31, 2008, to a person | ||||||
6 | who would be a member of the same unitary business | ||||||
7 | group but for the fact that the person is prohibited | ||||||
8 | under Section 1501(a)(27) from being included in the | ||||||
9 | unitary business group because he or she is ordinarily | ||||||
10 | required to apportion business income under different | ||||||
11 | subsections of Section 304, but not to exceed the | ||||||
12 | addition modification required to be made for the same | ||||||
13 | taxable year under Section 203(d)(2)(D-8) for | ||||||
14 | intangible expenses and costs paid, accrued, or | ||||||
15 | incurred, directly or indirectly, to the same person. | ||||||
16 | This subparagraph (S) is exempt from Section 250.
(T)
| ||||||
17 | (e) Gross income; adjusted gross income; taxable income.
| ||||||
18 | (1) In general. Subject to the provisions of paragraph | ||||||
19 | (2) and
subsection (b) (3), for purposes of this Section | ||||||
20 | and Section 803(e), a
taxpayer's gross income, adjusted | ||||||
21 | gross income, or taxable income for
the taxable year shall | ||||||
22 | mean the amount of gross income, adjusted gross
income or | ||||||
23 | taxable income properly reportable for federal income tax
| ||||||
24 | purposes for the taxable year under the provisions of the | ||||||
25 | Internal
Revenue Code. Taxable income may be less than |
| |||||||
| |||||||
1 | zero. However, for taxable
years ending on or after | ||||||
2 | December 31, 1986, net operating loss
carryforwards from | ||||||
3 | taxable years ending prior to December 31, 1986, may not
| ||||||
4 | exceed the sum of federal taxable income for the taxable | ||||||
5 | year before net
operating loss deduction, plus the excess | ||||||
6 | of addition modifications over
subtraction modifications | ||||||
7 | for the taxable year. For taxable years ending
prior to | ||||||
8 | December 31, 1986, taxable income may never be an amount in | ||||||
9 | excess
of the net operating loss for the taxable year as | ||||||
10 | defined in subsections
(c) and (d) of Section 172 of the | ||||||
11 | Internal Revenue Code, provided that when
taxable income of | ||||||
12 | a corporation (other than a Subchapter S corporation),
| ||||||
13 | trust, or estate is less than zero and addition | ||||||
14 | modifications, other than
those provided by subparagraph | ||||||
15 | (E) of paragraph (2) of subsection (b) for
corporations or | ||||||
16 | subparagraph (E) of paragraph (2) of subsection (c) for
| ||||||
17 | trusts and estates, exceed subtraction modifications, an | ||||||
18 | addition
modification must be made under those | ||||||
19 | subparagraphs for any other taxable
year to which the | ||||||
20 | taxable income less than zero (net operating loss) is
| ||||||
21 | applied under Section 172 of the Internal Revenue Code or | ||||||
22 | under
subparagraph (E) of paragraph (2) of this subsection | ||||||
23 | (e) applied in
conjunction with Section 172 of the Internal | ||||||
24 | Revenue Code.
| ||||||
25 | (2) Special rule. For purposes of paragraph (1) of this | ||||||
26 | subsection,
the taxable income properly reportable for |
| |||||||
| |||||||
1 | federal income tax purposes
shall mean:
| ||||||
2 | (A) Certain life insurance companies. In the case | ||||||
3 | of a life
insurance company subject to the tax imposed | ||||||
4 | by Section 801 of the
Internal Revenue Code, life | ||||||
5 | insurance company taxable income, plus the
amount of | ||||||
6 | distribution from pre-1984 policyholder surplus | ||||||
7 | accounts as
calculated under Section 815a of the | ||||||
8 | Internal Revenue Code;
| ||||||
9 | (B) Certain other insurance companies. In the case | ||||||
10 | of mutual
insurance companies subject to the tax | ||||||
11 | imposed by Section 831 of the
Internal Revenue Code, | ||||||
12 | insurance company taxable income;
| ||||||
13 | (C) Regulated investment companies. In the case of | ||||||
14 | a regulated
investment company subject to the tax | ||||||
15 | imposed by Section 852 of the
Internal Revenue Code, | ||||||
16 | investment company taxable income;
| ||||||
17 | (D) Real estate investment trusts. In the case of a | ||||||
18 | real estate
investment trust subject to the tax imposed | ||||||
19 | by Section 857 of the
Internal Revenue Code, real | ||||||
20 | estate investment trust taxable income;
| ||||||
21 | (E) Consolidated corporations. In the case of a | ||||||
22 | corporation which
is a member of an affiliated group of | ||||||
23 | corporations filing a consolidated
income tax return | ||||||
24 | for the taxable year for federal income tax purposes,
| ||||||
25 | taxable income determined as if such corporation had | ||||||
26 | filed a separate
return for federal income tax purposes |
| |||||||
| |||||||
1 | for the taxable year and each
preceding taxable year | ||||||
2 | for which it was a member of an affiliated group.
For | ||||||
3 | purposes of this subparagraph, the taxpayer's separate | ||||||
4 | taxable
income shall be determined as if the election | ||||||
5 | provided by Section
243(b) (2) of the Internal Revenue | ||||||
6 | Code had been in effect for all such years;
| ||||||
7 | (F) Cooperatives. In the case of a cooperative | ||||||
8 | corporation or
association, the taxable income of such | ||||||
9 | organization determined in
accordance with the | ||||||
10 | provisions of Section 1381 through 1388 of the
Internal | ||||||
11 | Revenue Code;
| ||||||
12 | (G) Subchapter S corporations. In the case of: (i) | ||||||
13 | a Subchapter S
corporation for which there is in effect | ||||||
14 | an election for the taxable year
under Section 1362 of | ||||||
15 | the Internal Revenue Code, the taxable income of such
| ||||||
16 | corporation determined in accordance with Section | ||||||
17 | 1363(b) of the Internal
Revenue Code, except that | ||||||
18 | taxable income shall take into
account those items | ||||||
19 | which are required by Section 1363(b)(1) of the
| ||||||
20 | Internal Revenue Code to be separately stated; and (ii) | ||||||
21 | a Subchapter
S corporation for which there is in effect | ||||||
22 | a federal election to opt out of
the provisions of the | ||||||
23 | Subchapter S Revision Act of 1982 and have applied
| ||||||
24 | instead the prior federal Subchapter S rules as in | ||||||
25 | effect on July 1, 1982,
the taxable income of such | ||||||
26 | corporation determined in accordance with the
federal |
| |||||||
| |||||||
1 | Subchapter S rules as in effect on July 1, 1982; and
| ||||||
2 | (H) Partnerships. In the case of a partnership, | ||||||
3 | taxable income
determined in accordance with Section | ||||||
4 | 703 of the Internal Revenue Code,
except that taxable | ||||||
5 | income shall take into account those items which are
| ||||||
6 | required by Section 703(a)(1) to be separately stated | ||||||
7 | but which would be
taken into account by an individual | ||||||
8 | in calculating his taxable income.
| ||||||
9 | (3) Recapture of business expenses on disposition of | ||||||
10 | asset or business. Notwithstanding any other law to the | ||||||
11 | contrary, if in prior years income from an asset or | ||||||
12 | business has been classified as business income and in a | ||||||
13 | later year is demonstrated to be non-business income, then | ||||||
14 | all expenses, without limitation, deducted in such later | ||||||
15 | year and in the 2 immediately preceding taxable years | ||||||
16 | related to that asset or business that generated the | ||||||
17 | non-business income shall be added back and recaptured as | ||||||
18 | business income in the year of the disposition of the asset | ||||||
19 | or business. Such amount shall be apportioned to Illinois | ||||||
20 | using the greater of the apportionment fraction computed | ||||||
21 | for the business under Section 304 of this Act for the | ||||||
22 | taxable year or the average of the apportionment fractions | ||||||
23 | computed for the business under Section 304 of this Act for | ||||||
24 | the taxable year and for the 2 immediately preceding | ||||||
25 | taxable years.
|
| |||||||
| |||||||
1 | (f) Valuation limitation amount.
| ||||||
2 | (1) In general. The valuation limitation amount | ||||||
3 | referred to in
subsections (a) (2) (G), (c) (2) (I) and | ||||||
4 | (d)(2) (E) is an amount equal to:
| ||||||
5 | (A) The sum of the pre-August 1, 1969 appreciation | ||||||
6 | amounts (to the
extent consisting of gain reportable | ||||||
7 | under the provisions of Section
1245 or 1250 of the | ||||||
8 | Internal Revenue Code) for all property in respect
of | ||||||
9 | which such gain was reported for the taxable year; plus
| ||||||
10 | (B) The lesser of (i) the sum of the pre-August 1, | ||||||
11 | 1969 appreciation
amounts (to the extent consisting of | ||||||
12 | capital gain) for all property in
respect of which such | ||||||
13 | gain was reported for federal income tax purposes
for | ||||||
14 | the taxable year, or (ii) the net capital gain for the | ||||||
15 | taxable year,
reduced in either case by any amount of | ||||||
16 | such gain included in the amount
determined under | ||||||
17 | subsection (a) (2) (F) or (c) (2) (H).
| ||||||
18 | (2) Pre-August 1, 1969 appreciation amount.
| ||||||
19 | (A) If the fair market value of property referred | ||||||
20 | to in paragraph
(1) was readily ascertainable on August | ||||||
21 | 1, 1969, the pre-August 1, 1969
appreciation amount for | ||||||
22 | such property is the lesser of (i) the excess of
such | ||||||
23 | fair market value over the taxpayer's basis (for | ||||||
24 | determining gain)
for such property on that date | ||||||
25 | (determined under the Internal Revenue
Code as in | ||||||
26 | effect on that date), or (ii) the total gain realized |
| |||||||
| |||||||
1 | and
reportable for federal income tax purposes in | ||||||
2 | respect of the sale,
exchange or other disposition of | ||||||
3 | such property.
| ||||||
4 | (B) If the fair market value of property referred | ||||||
5 | to in paragraph
(1) was not readily ascertainable on | ||||||
6 | August 1, 1969, the pre-August 1,
1969 appreciation | ||||||
7 | amount for such property is that amount which bears
the | ||||||
8 | same ratio to the total gain reported in respect of the | ||||||
9 | property for
federal income tax purposes for the | ||||||
10 | taxable year, as the number of full
calendar months in | ||||||
11 | that part of the taxpayer's holding period for the
| ||||||
12 | property ending July 31, 1969 bears to the number of | ||||||
13 | full calendar
months in the taxpayer's entire holding | ||||||
14 | period for the
property.
| ||||||
15 | (C) The Department shall prescribe such | ||||||
16 | regulations as may be
necessary to carry out the | ||||||
17 | purposes of this paragraph.
| ||||||
18 | (g) Double deductions. Unless specifically provided | ||||||
19 | otherwise, nothing
in this Section shall permit the same item | ||||||
20 | to be deducted more than once.
| ||||||
21 | (h) Legislative intention. Except as expressly provided by | ||||||
22 | this
Section there shall be no modifications or limitations on | ||||||
23 | the amounts
of income, gain, loss or deduction taken into | ||||||
24 | account in determining
gross income, adjusted gross income or |
| |||||||
| |||||||
1 | taxable income for federal income
tax purposes for the taxable | ||||||
2 | year, or in the amount of such items
entering into the | ||||||
3 | computation of base income and net income under this
Act for | ||||||
4 | such taxable year, whether in respect of property values as of
| ||||||
5 | August 1, 1969 or otherwise.
| ||||||
6 | (Source: P.A. 94-776, eff. 5-19-06; 94-789, eff. 5-19-06; | ||||||
7 | 94-1021, eff. 7-12-06; 94-1074, eff. 12-26-06; 95-23, eff. | ||||||
8 | 8-3-07; 95-233, eff. 8-16-07; 95-286, eff. 8-20-07; 95-331, | ||||||
9 | eff. 8-21-07; 95-707, eff. 1-11-08; 95-876, eff. 8-21-08; | ||||||
10 | revised 10-15-08.)
| ||||||
11 | (35 ILCS 5/502) (from Ch. 120, par. 5-502)
| ||||||
12 | Sec. 502. Returns and notices.
| ||||||
13 | (a) In general. A return with respect to the taxes imposed | ||||||
14 | by this
Act shall be made by every person for any taxable year:
| ||||||
15 | (1) for which such person is liable for a tax imposed | ||||||
16 | by this Act,
or
| ||||||
17 | (2) in the case of a resident or in the case of a | ||||||
18 | corporation which
is qualified to do business in this | ||||||
19 | State, for which such person is
required to make a federal | ||||||
20 | income tax return, regardless of whether such
person is | ||||||
21 | liable for a tax imposed by this Act. However, this | ||||||
22 | paragraph
shall not require a resident to make a return if | ||||||
23 | such person has
an
Illinois base income of the basic amount | ||||||
24 | in Section 204(b) or
less and is either claimed as a | ||||||
25 | dependent on
another person's tax return under the Internal |
| |||||||
| |||||||
1 | Revenue Code of 1986, or is
claimed as a dependent on | ||||||
2 | another person's tax return under this Act.
| ||||||
3 | Notwithstanding the provisions of paragraph (1), a | ||||||
4 | nonresident whose Illinois income tax liability under | ||||||
5 | subsections (a), (b), (c), and (d) of Section 201 of this Act | ||||||
6 | is paid in full after taking into account the credits allowed | ||||||
7 | under subsection (f) of this Section or allowed under Section | ||||||
8 | 709.5 of this Act shall not be required to file a return under | ||||||
9 | this subsection (a).
| ||||||
10 | (b) Fiduciaries and receivers.
| ||||||
11 | (1) Decedents. If an individual is deceased, any return | ||||||
12 | or notice
required of such individual under this Act shall | ||||||
13 | be made by his
executor, administrator, or other person | ||||||
14 | charged with the property of
such decedent.
| ||||||
15 | (2) Individuals under a disability. If an individual is | ||||||
16 | unable
to make a return or notice required under this Act, | ||||||
17 | the return or notice
required of such individual shall be | ||||||
18 | made by his duly authorized agent,
guardian, fiduciary or | ||||||
19 | other person charged with the care
of the person or | ||||||
20 | property of such individual.
| ||||||
21 | (3) Estates and trusts. Returns or notices required of | ||||||
22 | an estate
or a trust shall be made by the fiduciary | ||||||
23 | thereof.
| ||||||
24 | (4) Receivers, trustees and assignees for | ||||||
25 | corporations. In a
case where a receiver, trustee in | ||||||
26 | bankruptcy, or assignee, by order of a
court of competent |
| |||||||
| |||||||
1 | jurisdiction, by operation of law, or otherwise, has
| ||||||
2 | possession of or holds title to all or substantially all | ||||||
3 | the property or
business of a corporation, whether or not | ||||||
4 | such property or business is
being operated, such receiver, | ||||||
5 | trustee, or assignee shall make the
returns and notices | ||||||
6 | required of such corporation in the same manner and
form as | ||||||
7 | corporations are required to make such returns and notices.
| ||||||
8 | (c) Joint returns by husband and wife.
| ||||||
9 | (1) Except as provided in paragraph (3) : , | ||||||
10 | (A) if a husband and wife file a
joint federal | ||||||
11 | income tax return for a taxable year ending before | ||||||
12 | December 31, 2009, they shall file a joint
return under | ||||||
13 | this Act for such taxable year and their liabilities | ||||||
14 | shall be
joint and several ; , but | ||||||
15 | (B) if a husband and wife file a joint federal | ||||||
16 | income tax return for a taxable year ending on or after | ||||||
17 | December 31, 2009, they may elect to file separate | ||||||
18 | returns under this Act for such taxable year. The | ||||||
19 | election under this paragraph must be made on or before | ||||||
20 | the due date (including extensions) of the return and, | ||||||
21 | once made, shall be irrevocable. If no election is | ||||||
22 | timely made under this paragraph for a taxable year: | ||||||
23 | (i) the couple must file a joint return under | ||||||
24 | this Act for such taxable year, | ||||||
25 | (ii) their liabilities shall be joint and | ||||||
26 | several, and |
| |||||||
| |||||||
1 | (iii) any overpayment for that taxable year | ||||||
2 | may be withheld under Section 909 of this Act or | ||||||
3 | under Section 2505-275 of the Civil Administrative | ||||||
4 | Code of Illinois and applied against a debt of | ||||||
5 | either spouse without regard to the amount of the | ||||||
6 | overpayment attributable to the other spouse; and | ||||||
7 | (C) if the federal income tax liability of either | ||||||
8 | spouse is
determined on a separate federal income tax | ||||||
9 | return, they shall file separate
returns under this | ||||||
10 | Act.
| ||||||
11 | (2) If neither spouse is required to file a federal | ||||||
12 | income tax
return and either or both are required to file a | ||||||
13 | return under this Act,
they may elect to file separate or | ||||||
14 | joint returns and pursuant to such
election their | ||||||
15 | liabilities shall be separate or joint and several.
| ||||||
16 | (3) If either husband or wife is a resident and the | ||||||
17 | other is a
nonresident, they shall file separate returns in | ||||||
18 | this State on such
forms as may be required by the | ||||||
19 | Department in which event their tax
liabilities shall be | ||||||
20 | separate; but if they file a joint federal income tax | ||||||
21 | return for a taxable year, they may elect to determine | ||||||
22 | their
joint net income and file a joint return for that | ||||||
23 | taxable year under the provisions of paragraph (1) of this | ||||||
24 | subsection as if both were residents and
in such case, | ||||||
25 | their liabilities shall be joint and several.
| ||||||
26 | (4) Innocent spouses.
|
| |||||||
| |||||||
1 | (A) However, for tax liabilities arising and paid | ||||||
2 | prior to August 13,
1999, an innocent spouse shall be | ||||||
3 | relieved of
liability for tax
(including interest and | ||||||
4 | penalties) for any taxable year for which a joint
| ||||||
5 | return has been made, upon submission of proof that the | ||||||
6 | Internal Revenue
Service has made a determination | ||||||
7 | under Section 6013(e) of the Internal
Revenue Code, for | ||||||
8 | the same taxable year, which determination relieved | ||||||
9 | the
spouse from liability for federal income taxes.
If | ||||||
10 | there is no federal income tax liability at issue for | ||||||
11 | the
same taxable year, the Department shall rely on the | ||||||
12 | provisions of Section
6013(e) to determine whether the | ||||||
13 | person requesting innocent spouse abatement of
tax, | ||||||
14 | penalty, and interest is entitled to that relief.
| ||||||
15 | (B) For tax liabilities arising on and after August | ||||||
16 | 13, 1999 or which arose prior to that date, but remain | ||||||
17 | unpaid as of that date, if
an individual
who filed a | ||||||
18 | joint return for any taxable year has made an election | ||||||
19 | under this
paragraph, the individual's liability for | ||||||
20 | any tax shown on the joint return
shall not exceed the | ||||||
21 | individual's separate return amount and the | ||||||
22 | individual's
liability for any deficiency assessed for | ||||||
23 | that taxable year shall not exceed
the portion of the | ||||||
24 | deficiency properly allocable to the individual. For
| ||||||
25 | purposes of this paragraph:
| ||||||
26 | (i) An election properly made pursuant to |
| |||||||
| |||||||
1 | Section 6015 of the Internal
Revenue Code shall | ||||||
2 | constitute an election under this paragraph, | ||||||
3 | provided that
the election shall not be effective | ||||||
4 | until the individual has notified the
Department | ||||||
5 | of the election in the form and manner prescribed | ||||||
6 | by the Department.
| ||||||
7 | (ii) If no election has been made under Section | ||||||
8 | 6015, the individual
may make an election under | ||||||
9 | this paragraph in the form and manner prescribed by
| ||||||
10 | the Department, provided that no election may be | ||||||
11 | made if the Department finds
that assets were | ||||||
12 | transferred
between individuals filing a joint | ||||||
13 | return as part of a scheme by such
individuals to | ||||||
14 | avoid payment of Illinois income tax and the | ||||||
15 | election shall not
eliminate the individual's | ||||||
16 | liability for any portion of a deficiency
| ||||||
17 | attributable to an error on the return of which the | ||||||
18 | individual had actual
knowledge as of the date of | ||||||
19 | filing.
| ||||||
20 | (iii) In determining the separate return | ||||||
21 | amount or portion of any
deficiency attributable | ||||||
22 | to an individual, the Department shall follow the
| ||||||
23 | provisions in subsections (c) and (d) of Section | ||||||
24 | 6015 of the Internal Revenue Code.
| ||||||
25 | (iv) In determining the validity of an | ||||||
26 | individual's election under
subparagraph (ii) and |
| |||||||
| |||||||
1 | in determining an electing individual's separate | ||||||
2 | return
amount or portion of any deficiency under | ||||||
3 | subparagraph (iii), any determination
made by the | ||||||
4 | Secretary of the Treasury, by the United States Tax | ||||||
5 | Court on
petition for review of a determination by | ||||||
6 | the Secretary of the Treasury, or on
appeal from | ||||||
7 | the United States Tax Court under Section 6015 of
| ||||||
8 | the Internal
Revenue Code regarding criteria for | ||||||
9 | eligibility or under subsection (d) of
Section | ||||||
10 | 6015
of the Internal Revenue Code regarding the | ||||||
11 | allocation of any item of income,
deduction, | ||||||
12 | payment, or credit between an individual making | ||||||
13 | the federal election
and that individual's spouse | ||||||
14 | shall be conclusively presumed to be correct.
With | ||||||
15 | respect to any item that is not the subject of a | ||||||
16 | determination by the
Secretary of the Treasury or | ||||||
17 | the federal courts, in any proceeding
involving | ||||||
18 | this subsection, the
individual making the | ||||||
19 | election shall have the burden of proof with | ||||||
20 | respect to
any item except that the Department | ||||||
21 | shall have the burden of proof with respect
to | ||||||
22 | items in subdivision (ii).
| ||||||
23 | (v) Any election made by an individual under | ||||||
24 | this subsection shall
apply to all years for which | ||||||
25 | that individual and the spouse named in the
| ||||||
26 | election have filed a joint return.
|
| |||||||
| |||||||
1 | (vi) After receiving a notice that the federal | ||||||
2 | election has been made
or after receiving an | ||||||
3 | election under subdivision (ii), the Department | ||||||
4 | shall
take no collection action against the | ||||||
5 | electing individual for any liability
arising from | ||||||
6 | a joint return covered by the election until the | ||||||
7 | Department has
notified the electing individual in | ||||||
8 | writing that the election is invalid or of
the | ||||||
9 | portion of the liability the Department has | ||||||
10 | allocated to the electing
individual. Within 60 | ||||||
11 | days (150 days if the individual is outside the | ||||||
12 | United
States) after the issuance of such | ||||||
13 | notification, the individual may file a
written | ||||||
14 | protest of the denial of the election or of the | ||||||
15 | Department's
determination of the liability | ||||||
16 | allocated to him or her and shall be granted a
| ||||||
17 | hearing within the Department under the provisions | ||||||
18 | of Section 908. If a
protest is filed, the | ||||||
19 | Department shall take no collection action against | ||||||
20 | the
electing individual until the decision | ||||||
21 | regarding the protest has become final
under | ||||||
22 | subsection (d) of Section 908 or, if | ||||||
23 | administrative review of the
Department's decision
| ||||||
24 | is requested under Section 1201, until the | ||||||
25 | decision of the court becomes
final.
| ||||||
26 | (d) Partnerships. Every partnership having any base income
|
| |||||||
| |||||||
1 | allocable to this State in accordance with section 305(c) shall | ||||||
2 | retain
information concerning all items of income, gain, loss | ||||||
3 | and
deduction; the names and addresses of all of the partners, | ||||||
4 | or names and
addresses of members of a limited liability | ||||||
5 | company, or other
persons who would be entitled to share in the | ||||||
6 | base income of the
partnership if distributed; the amount of | ||||||
7 | the distributive share of
each; and such other pertinent | ||||||
8 | information as the Department may by
forms or regulations | ||||||
9 | prescribe. The partnership shall make that information
| ||||||
10 | available to the Department when requested by the Department.
| ||||||
11 | (e) For taxable years ending on or after December 31, 1985, | ||||||
12 | and before
December 31, 1993, taxpayers
that are corporations | ||||||
13 | (other than Subchapter S corporations) having the
same taxable | ||||||
14 | year and that are members of the same unitary business group
| ||||||
15 | may elect to be treated as one taxpayer for purposes of any | ||||||
16 | original return,
amended return which includes the same | ||||||
17 | taxpayers of the unitary group which
joined in the election to | ||||||
18 | file the original return, extension, claim for
refund, | ||||||
19 | assessment, collection and payment and determination of the
| ||||||
20 | group's tax liability under this Act. This subsection (e) does | ||||||
21 | not permit the
election to be made for some, but not all, of | ||||||
22 | the purposes enumerated above.
For taxable years ending on or | ||||||
23 | after December 31, 1987, corporate members
(other than | ||||||
24 | Subchapter S corporations) of the same unitary business group
| ||||||
25 | making this subsection (e) election are not required to have | ||||||
26 | the same taxable
year.
|
| |||||||
| |||||||
1 | For taxable years ending on or after December 31, 1993, | ||||||
2 | taxpayers that are
corporations (other than Subchapter S | ||||||
3 | corporations) and that are members of
the same unitary business | ||||||
4 | group shall be treated as one taxpayer for purposes
of any | ||||||
5 | original return, amended return which includes the same | ||||||
6 | taxpayers of the
unitary group which joined in filing the | ||||||
7 | original return, extension, claim for
refund, assessment, | ||||||
8 | collection and payment and determination of the group's tax
| ||||||
9 | liability under this Act.
| ||||||
10 | (f) The Department may promulgate regulations to permit | ||||||
11 | nonresident
individual partners of the same partnership, | ||||||
12 | nonresident Subchapter S
corporation shareholders of the same | ||||||
13 | Subchapter S corporation, and
nonresident individuals | ||||||
14 | transacting an insurance business in Illinois under
a Lloyds | ||||||
15 | plan of operation, and nonresident individual members of the | ||||||
16 | same
limited liability company that is treated as a partnership | ||||||
17 | under Section 1501
(a)(16) of this Act, to file composite | ||||||
18 | individual income tax returns
reflecting the composite income | ||||||
19 | of such individuals allocable to Illinois
and to make composite | ||||||
20 | individual income tax payments. The Department may
by | ||||||
21 | regulation also permit such composite returns to include the | ||||||
22 | income tax
owed by Illinois residents attributable to their | ||||||
23 | income from partnerships,
Subchapter S corporations, insurance | ||||||
24 | businesses organized under a Lloyds
plan of operation, or | ||||||
25 | limited liability companies that are treated as
partnership | ||||||
26 | under Section 1501(a)(16) of this Act, in which case such
|
| |||||||
| |||||||
1 | Illinois residents will be permitted to claim credits on their | ||||||
2 | individual
returns for their shares of the composite tax | ||||||
3 | payments. This paragraph of
subsection (f) applies to taxable | ||||||
4 | years ending on or after December 31, 1987.
| ||||||
5 | For taxable years ending on or after December 31, 1999, the | ||||||
6 | Department may,
by regulation, also permit any persons | ||||||
7 | transacting an insurance business
organized under a Lloyds plan | ||||||
8 | of operation to file composite returns reflecting
the income of | ||||||
9 | such persons allocable to Illinois and the tax rates applicable
| ||||||
10 | to such persons under Section 201 and to make composite tax | ||||||
11 | payments and shall,
by regulation, also provide that the income | ||||||
12 | and apportionment factors
attributable to the transaction of an | ||||||
13 | insurance business organized under a
Lloyds plan of operation | ||||||
14 | by any person joining in the filing of a composite
return | ||||||
15 | shall, for purposes of allocating and apportioning income under | ||||||
16 | Article
3 of this Act and computing net income under Section | ||||||
17 | 202 of this Act, be
excluded from any other income and | ||||||
18 | apportionment factors of that person or of
any unitary business | ||||||
19 | group, as defined in subdivision (a)(27) of Section 1501,
to | ||||||
20 | which that person may belong.
| ||||||
21 | For taxable years ending on or after December 31, 2008, | ||||||
22 | every nonresident shall be allowed a credit against his or her | ||||||
23 | liability under subsections (a) and (b) of Section 201 for any | ||||||
24 | amount of tax reported on a composite return and paid on his or | ||||||
25 | her behalf under this subsection (f). Residents (other than | ||||||
26 | persons transacting an insurance business organized under a |
| |||||||
| |||||||
1 | Lloyds plan of operation) may claim a credit for taxes reported | ||||||
2 | on a composite return and paid on their behalf under this | ||||||
3 | subsection (f) only as permitted by the Department by rule.
| ||||||
4 | (f-5) For taxable years ending on or after December 31, | ||||||
5 | 2008, the Department may adopt rules to provide that, when a | ||||||
6 | partnership or Subchapter S corporation has made an error in | ||||||
7 | determining the amount of any item of income, deduction, | ||||||
8 | addition, subtraction, or credit required to be reported on its | ||||||
9 | return that affects the liability imposed under this Act on a | ||||||
10 | partner or shareholder, the partnership or Subchapter S | ||||||
11 | corporation may report the changes in liabilities of its | ||||||
12 | partners or shareholders and claim a refund of the resulting | ||||||
13 | overpayments, or pay the resulting underpayments, on behalf of | ||||||
14 | its partners and shareholders.
| ||||||
15 | (g) The Department may adopt rules to authorize the | ||||||
16 | electronic filing of
any return required to be filed under this | ||||||
17 | Section.
| ||||||
18 | (Source: P.A. 94-1074, eff. 12-26-06; 95-233, eff. 8-16-07.)
| ||||||
19 | (35 ILCS 5/911.1) (from Ch. 120, par. 9-911.1)
| ||||||
20 | Sec. 911.1. If the Department withholds any refund due | ||||||
21 | under this Act
because of any other liability to the State and | ||||||
22 | if the return for which
such refund is due is a joint return | ||||||
23 | for a taxable year ending before December 31, 2009 , the | ||||||
24 | taxpayer who jointly filed such
return and who is not liable to | ||||||
25 | the State shall be entitled to that portion
of the refund |
| |||||||
| |||||||
1 | attributable to himself or herself.
| ||||||
2 | (Source: P.A. 85-473.)
| ||||||
3 | (35 ILCS 5/911.2)
| ||||||
4 | Sec. 911.2. Refunds withheld; tax claims of other states.
| ||||||
5 | (a) Definitions. In this Section the following terms have | ||||||
6 | the meanings
indicated.
| ||||||
7 | "Claimant state" means any state or the District of | ||||||
8 | Columbia that requests
the withholding of a refund pursuant to | ||||||
9 | this Section and that extends a like
comity for the collection | ||||||
10 | of taxes owed to this State.
| ||||||
11 | "Income tax" means any amount of income tax imposed on | ||||||
12 | taxpayers under the
laws of the State of Illinois or the | ||||||
13 | claimant state, including additions to tax
for penalties and | ||||||
14 | interest.
| ||||||
15 | "Refund" means a refund of overpaid income taxes imposed by | ||||||
16 | the State of
Illinois or the claimant state.
| ||||||
17 | "Tax officer" means a unit or official of the claimant | ||||||
18 | state, or the duly
authorized agent of that unit or official, | ||||||
19 | charged with the imposition,
assessment, or collection of state | ||||||
20 | income taxes.
| ||||||
21 | "Taxpayer" means any individual person identified by a | ||||||
22 | claimant state under
this Section
as owing taxes to that | ||||||
23 | claimant state, and in the case of a refund arising from
the | ||||||
24 | filing of a joint return, the taxpayer's spouse.
| ||||||
25 | (b) In general. Except as provided in subsection (c) of |
| |||||||
| |||||||
1 | this Section, a tax
officer may:
| ||||||
2 | (1) certify to the Director the existence of a | ||||||
3 | taxpayer's delinquent
income tax liability; and
| ||||||
4 | (2) request the Director to withhold any refund to | ||||||
5 | which the taxpayer is
entitled.
| ||||||
6 | (c) Comity. A tax officer may not certify or request the | ||||||
7 | Director to
withhold a refund unless the laws of the claimant | ||||||
8 | state:
| ||||||
9 | (1) allow the Director to certify an income tax | ||||||
10 | liability;
| ||||||
11 | (2) allow the Director to request the tax officer to | ||||||
12 | withhold the
taxpayer's tax refund; and
| ||||||
13 | (3) provide for the payment of the refund to the State | ||||||
14 | of Illinois.
| ||||||
15 | (d) Certification. A certification by a tax officer to the | ||||||
16 | Director shall
include:
| ||||||
17 | (1) the full name and address of the taxpayer and any | ||||||
18 | other names known to
be used by the taxpayer;
| ||||||
19 | (2) the social security number or federal tax | ||||||
20 | identification number of the
taxpayer;
| ||||||
21 | (3) the amount of the income tax liability; and
| ||||||
22 | (4) a statement that all administrative and judicial | ||||||
23 | remedies and appeals
have been exhausted or have lapsed and | ||||||
24 | that the assessment of tax, interest,
and penalty has | ||||||
25 | become final.
| ||||||
26 | (e) Notification. As to any taxpayer due a refund, the |
| |||||||
| |||||||
1 | Director shall:
| ||||||
2 | (1) notify the taxpayer that a claimant state has | ||||||
3 | provided certification
of the existence of an income tax | ||||||
4 | liability;
| ||||||
5 | (2) inform the taxpayer of the tax liability certified, | ||||||
6 | including a
detailed statement for each taxable year | ||||||
7 | showing tax, interest, and penalty;
| ||||||
8 | (3) inform the taxpayer that failure to file a protest | ||||||
9 | in accordance with
subsection (f) of this Section shall | ||||||
10 | constitute a waiver of any demand against
this State for | ||||||
11 | the amount certified;
| ||||||
12 | (3.5) inform the taxpayer that the refund has been | ||||||
13 | withheld and that the
tax liability has been paid to the | ||||||
14 | claimant state as provided in subsection (i)
of this | ||||||
15 | Section;
| ||||||
16 | (4) provide the taxpayer with notice of an opportunity | ||||||
17 | to request a
hearing to challenge the certification; and
| ||||||
18 | (5) inform the taxpayer that the hearing may be | ||||||
19 | requested (i) pursuant to
Section 910 of this Act, or (ii) | ||||||
20 | with the tax officer, in accordance with the
laws of the | ||||||
21 | claimant state.
| ||||||
22 | (f) Protest of withholding. A taxpayer may protest the | ||||||
23 | withholding of a
refund pursuant to Section 910 of this Act | ||||||
24 | (except that the protest shall be
filed within 30 days after | ||||||
25 | the date of the Director's notice of certification
pursuant to | ||||||
26 | subsection (e) of this Section).
|
| |||||||
| |||||||
1 | (g) Certification as prima facie evidence. If the taxpayer | ||||||
2 | requests a
hearing pursuant to Section 910 of this Act, the | ||||||
3 | certification of the tax
officer shall be prima facie evidence | ||||||
4 | of the correctness of the taxpayer's
delinquent income tax | ||||||
5 | liability to the certifying state.
| ||||||
6 | (h) Rights of spouses to refunds from joint returns. If a | ||||||
7 | certification is
based upon the tax debt of only one taxpayer | ||||||
8 | and if the refund is based upon a
joint personal income tax | ||||||
9 | return for a taxable year ending before December 31, 2009 , the | ||||||
10 | nondebtor spouse shall have the right to:
| ||||||
11 | (1) notification, as provided in subsection (e) of this | ||||||
12 | Section;
| ||||||
13 | (2) protest, as to the withholding of such spouse's | ||||||
14 | share of the refund,
as provided in subsection (f) of this | ||||||
15 | Section; and
| ||||||
16 | (3) payment of his or her share of the refund, provided | ||||||
17 | the amount of the
overpayment refunded to the spouse shall | ||||||
18 | not exceed the amount of the joint
overpayment.
| ||||||
19 | (i) Withholding and payment of refund. Upon receipt of a | ||||||
20 | request for withholding in accordance
with subsection (b) of | ||||||
21 | this Section, the Director shall:
| ||||||
22 | (1) withhold any refund that is certified by the tax | ||||||
23 | officer;
| ||||||
24 | (2) pay to the claimant state the entire refund or the | ||||||
25 | amount certified,
whichever is less;
| ||||||
26 | (3) pay any refund in excess of the amount certified to |
| |||||||
| |||||||
1 | the taxpayer; and
| ||||||
2 | (4) if a refund is less than the amount certified, | ||||||
3 | withhold amounts from
subsequent refunds due the taxpayer, | ||||||
4 | if the laws of the claimant state provide
that the claimant | ||||||
5 | state shall withhold subsequent refunds of taxpayers
| ||||||
6 | certified to that state by the Director.
| ||||||
7 | (j) Determination that withholding cannot be made. After | ||||||
8 | receiving a
certification from a tax officer, the Director | ||||||
9 | shall notify the claimant state
if the Director determines that | ||||||
10 | a withholding cannot be made.
| ||||||
11 | (k) Director's authority. The Director shall have the | ||||||
12 | authority to enter
into agreements with the tax officers of | ||||||
13 | claimant state relating to:
| ||||||
14 | (1) procedures and methods to be employed by a claimant | ||||||
15 | state with
respect to the operation of this Section;
| ||||||
16 | (2) safeguards against the disclosure or inappropriate | ||||||
17 | use of any
information obtained or maintained pursuant to | ||||||
18 | this Section that identifies,
directly or indirectly, a | ||||||
19 | particular taxpayer;
| ||||||
20 | (3) a minimum tax debt, amounts below which, in light | ||||||
21 | of administrative
expenses and efficiency, shall, in the | ||||||
22 | Director's discretion, not be subject to
the withholding | ||||||
23 | procedures set forth in this Section.
| ||||||
24 | (l) Remedy not exclusive. The collection procedures | ||||||
25 | prescribed by this
Section are in addition to, and not in | ||||||
26 | substitution for, any other remedy
available by law.
|
| |||||||
| |||||||
1 | (Source: P.A. 92-492, eff. 1-1-02; 92-826, eff. 8-21-02.)
| ||||||
2 | Section 15. The Use Tax Act is amended by changing Section | ||||||
3 | 10 as follows:
| ||||||
4 | (35 ILCS 105/10) (from Ch. 120, par. 439.10)
| ||||||
5 | Sec. 10. Except as to motor vehicles, aircraft, watercraft, | ||||||
6 | and
trailers, and except as to cigarettes as defined in the | ||||||
7 | Cigarette Use Tax, when tangible personal
property is
purchased | ||||||
8 | from a retailer for use in this State by a purchaser
who did | ||||||
9 | not pay the tax imposed by this Act to the retailer, and who | ||||||
10 | does not
file returns with the Department as a retailer under | ||||||
11 | Section 9 of this
Act, such purchaser (by the last day of the | ||||||
12 | month following the calendar
month in which such purchaser | ||||||
13 | makes any payment upon the selling price of
such property) | ||||||
14 | shall, except as provided in this Section, file
a return with | ||||||
15 | the Department and pay the tax upon that portion of the
selling | ||||||
16 | price so paid by the purchaser during the preceding calendar | ||||||
17 | month.
When tangible personal property, including but not | ||||||
18 | limited to motor vehicles
and aircraft, is purchased by a | ||||||
19 | lessor, under a lease for
one year or longer, executed or in | ||||||
20 | effect at the time of purchase to an
interstate carrier for | ||||||
21 | hire, who did not pay the tax imposed by this Act to the
| ||||||
22 | retailer, such lessor (by the last day of the month following | ||||||
23 | the calendar
month in which such property reverts to the use of | ||||||
24 | such lessor) shall file
a return with the Department and pay |
| |||||||
| |||||||
1 | the tax upon the fair market value of
such property on the date | ||||||
2 | of such reversion.
However, in determining the fair market | ||||||
3 | value at the time of reversion, the
fair market value of such | ||||||
4 | property shall not exceed the original purchase price
of the | ||||||
5 | property that was paid by the lessor at the time of purchase.
| ||||||
6 | Such return shall be filed on
a form prescribed by the | ||||||
7 | Department and shall contain such information as
the Department | ||||||
8 | may reasonably require. Such return and payment from the
| ||||||
9 | purchaser shall be submitted to the Department sooner than the | ||||||
10 | last day of
the month after the month in which the purchase is | ||||||
11 | made to the extent that
that may be necessary in order to | ||||||
12 | secure the title to a motor vehicle or
the certificate of | ||||||
13 | registration for an aircraft. However, except as to motor
| ||||||
14 | vehicles and aircraft, and except as to cigarettes as defined | ||||||
15 | in the Cigarette Use Tax Act, if the
purchaser's annual use tax | ||||||
16 | liability does not exceed $600, the purchaser
may file the | ||||||
17 | return on an annual basis on or before April 15th of the year
| ||||||
18 | following the year use tax liability was incurred.
| ||||||
19 | If cigarettes, as defined in the Cigarette Use Tax Act, are | ||||||
20 | purchased from a retailer for use in this State by a purchaser | ||||||
21 | who did not pay the tax imposed by this Act to the retailer, | ||||||
22 | and who does not file returns with the Department as a retailer | ||||||
23 | under Section 9 of this Act, such purchaser must, within 30 | ||||||
24 | days after acquiring the cigarettes, file a return with the | ||||||
25 | Department and pay the tax upon that portion of the selling | ||||||
26 | price so paid by the purchaser for the cigarettes. |
| |||||||
| |||||||
1 | In addition with respect to motor vehicles,
aircraft, | ||||||
2 | watercraft, and trailers, a purchaser of such tangible personal
| ||||||
3 | property for use in this
State, who purchases such tangible | ||||||
4 | personal property from an out-of-state
retailer, shall file | ||||||
5 | with the Department, upon a form to be prescribed and
supplied | ||||||
6 | by the Department, a return for each such item of tangible
| ||||||
7 | personal property purchased, except that if, in the same | ||||||
8 | transaction, (i) a
purchaser of motor vehicles,
aircraft, | ||||||
9 | watercraft, or trailers who is a retailer of motor vehicles,
| ||||||
10 | aircraft, watercraft, or trailers purchases more than one motor | ||||||
11 | vehicle,
aircraft, watercraft, or trailer for the purpose of | ||||||
12 | resale or (ii) a purchaser
of motor vehicles, aircraft, | ||||||
13 | watercraft, or trailers purchases more
than one motor vehicle, | ||||||
14 | aircraft, watercraft, or trailer for use as qualifying
rolling | ||||||
15 | stock as provided in Section 3-55 of this Act, then the | ||||||
16 | purchaser may
report the purchase of all motor vehicles, | ||||||
17 | aircraft, watercraft, or trailers
involved in that transaction | ||||||
18 | to the Department on a single return prescribed by
the | ||||||
19 | Department. Such return in the case of motor vehicles and
| ||||||
20 | aircraft must show the name and address of the seller, the | ||||||
21 | name, address of
purchaser, the amount of the selling price | ||||||
22 | including the amount allowed by
the retailer for traded in | ||||||
23 | property, if any; the amount allowed by the
retailer for the | ||||||
24 | traded-in tangible personal property, if any, to the
extent to | ||||||
25 | which Section 2 of this Act allows an exemption for the value | ||||||
26 | of
traded-in property; the balance payable after deducting such |
| |||||||
| |||||||
1 | trade-in
allowance from the total selling price; the amount of | ||||||
2 | tax due from the
purchaser with respect to such transaction; | ||||||
3 | the amount of tax collected
from the purchaser by the retailer | ||||||
4 | on such transaction (or satisfactory
evidence that such tax is | ||||||
5 | not due in that particular instance if that is
claimed to be | ||||||
6 | the fact); the place and date of the sale, a sufficient
| ||||||
7 | identification of the property sold, and such other information | ||||||
8 | as the
Department may reasonably require.
| ||||||
9 | Such return shall be filed not later than 30 days after | ||||||
10 | such motor
vehicle or aircraft is brought into this State for | ||||||
11 | use.
| ||||||
12 | For purposes of this Section, "watercraft" means a Class 2, | ||||||
13 | Class 3, or
Class 4 watercraft as defined in Section 3-2 of the | ||||||
14 | Boat Registration and
Safety Act, a personal watercraft, or any | ||||||
15 | boat equipped with an inboard
motor.
| ||||||
16 | The return and tax remittance or proof of exemption from | ||||||
17 | the tax that is
imposed by this Act may be transmitted to the | ||||||
18 | Department by way of the
State agency with which, or State | ||||||
19 | officer with whom, the tangible personal
property must be | ||||||
20 | titled or registered (if titling or registration is
required) | ||||||
21 | if the Department and such agency or State officer determine | ||||||
22 | that
this procedure will expedite the processing of | ||||||
23 | applications for title or
registration.
| ||||||
24 | With each such return, the purchaser shall remit the proper | ||||||
25 | amount of tax
due (or shall submit satisfactory evidence that | ||||||
26 | the sale is not taxable if
that is the case), to the Department |
| |||||||
| |||||||
1 | or its agents, whereupon the
Department shall issue, in the | ||||||
2 | purchaser's name, a tax receipt (or a
certificate of exemption | ||||||
3 | if the Department is satisfied that the particular
sale is tax | ||||||
4 | exempt) which such purchaser may submit to the agency with
| ||||||
5 | which, or State officer with whom, he must title or register | ||||||
6 | the tangible
personal property that is involved (if titling or | ||||||
7 | registration is required)
in support of such purchaser's | ||||||
8 | application for an Illinois certificate or
other evidence of | ||||||
9 | title or registration to such tangible personal property.
| ||||||
10 | When a purchaser pays a tax imposed by this Act directly to | ||||||
11 | the Department,
the Department (upon request therefor from such | ||||||
12 | purchaser) shall issue an
appropriate receipt to such purchaser | ||||||
13 | showing that he has paid such tax to
the Department. Such | ||||||
14 | receipt shall be sufficient to relieve the purchaser
from | ||||||
15 | further liability for the tax to which such receipt may refer.
| ||||||
16 | A user who is liable to pay use tax directly to the | ||||||
17 | Department only
occasionally and not on a frequently recurring | ||||||
18 | basis, and who is not
required to file returns with the | ||||||
19 | Department as a retailer under Section 9
of this Act, or under | ||||||
20 | the "Retailers' Occupation Tax Act", or as a
registrant with | ||||||
21 | the Department under the "Service Occupation Tax Act" or
the | ||||||
22 | "Service Use Tax Act", need not register with the Department.
| ||||||
23 | However, if such a user has a frequently recurring direct use | ||||||
24 | tax liability
to pay to the Department, such user shall be | ||||||
25 | required to register with the
Department on forms prescribed by | ||||||
26 | the Department and to obtain and display
a certificate of |
| |||||||
| |||||||
1 | registration from the Department. In that event, all of
the | ||||||
2 | provisions of Section 9 of this Act concerning the filing of | ||||||
3 | regular
monthly, quarterly or annual tax returns and all of the | ||||||
4 | provisions of
Section 2a of the "Retailers' Occupation Tax Act" | ||||||
5 | concerning the
requirements for registrants to post bond or | ||||||
6 | other security with the
Department, as the provisions of such | ||||||
7 | sections now exist or may hereafter
be amended, shall apply to | ||||||
8 | such users to the same extent as if such
provisions were | ||||||
9 | included herein.
| ||||||
10 | (Source: P.A. 91-541, eff. 8-13-99; 91-901, eff. 1-1-01.)
| ||||||
11 | Section 20. The Environmental Protection Act is amended by | ||||||
12 | changing Sections 55.8 and 55.10 as follows:
| ||||||
13 | (415 ILCS 5/55.8) (from Ch. 111 1/2, par. 1055.8)
| ||||||
14 | Sec. 55.8. Tire retailers.
| ||||||
15 | (a) Any person selling new or used tires at
retail or | ||||||
16 | offering new or used tires for retail sale in this State shall:
| ||||||
17 | (1) beginning on June 20, 2003 (the effective date of | ||||||
18 | Public Act
93-32), collect from retail customers a fee of | ||||||
19 | $2 per new or used
tire sold and delivered in this State, | ||||||
20 | to be paid to the Department of
Revenue and deposited into | ||||||
21 | the Used Tire Management Fund, less a collection
allowance | ||||||
22 | of 10 cents per tire to be retained by the retail seller | ||||||
23 | and a
collection allowance of 10 cents per tire to be | ||||||
24 | retained by the Department of
Revenue and paid into the |
| |||||||
| |||||||
1 | General Revenue Fund ; the collection allowance for retail | ||||||
2 | sellers, however, shall be allowed only if the return is | ||||||
3 | filed timely and only for the amount that is paid timely in | ||||||
4 | accordance with this Title XIV ;
| ||||||
5 | (1.5) beginning on July 1, 2003, collect from retail | ||||||
6 | customers an
additional 50 cents per new or used tire sold | ||||||
7 | and delivered in this State;
the money collected from this | ||||||
8 | fee shall be deposited into the Emergency Public
Health | ||||||
9 | Fund;
| ||||||
10 | (2) accept for recycling used tires from customers, at | ||||||
11 | the point of
transfer, in a quantity equal to the number of | ||||||
12 | new tires purchased; and
| ||||||
13 | (3) post in a conspicuous place a written notice at | ||||||
14 | least 8.5 by 11
inches in size that includes the universal | ||||||
15 | recycling symbol and the
following statements: "DO NOT put | ||||||
16 | used tires in the trash.";
"Recycle your used tires."; and | ||||||
17 | "State law requires us to accept used tires
for recycling, | ||||||
18 | in exchange for new tires purchased.".
| ||||||
19 | (b) A person who accepts used tires for recycling under | ||||||
20 | subsection (a)
shall not allow the tires to accumulate for | ||||||
21 | periods of more than 90 days.
| ||||||
22 | (c) The requirements of subsection (a) of this Section do | ||||||
23 | not apply
to mail order sales nor shall the retail sale of a | ||||||
24 | motor vehicle be considered
to be the sale of tires at retail | ||||||
25 | or offering of tires for retail sale.
Instead of filing | ||||||
26 | returns, retailers of tires may remit the tire user fee of
|
| |||||||
| |||||||
1 | $1.00 per tire to their suppliers of tires if the supplier of | ||||||
2 | tires is a
registered retailer of tires and agrees or otherwise | ||||||
3 | arranges to collect
and remit the tire fee to the Department of | ||||||
4 | Revenue, notwithstanding the fact
that the sale of the tire is | ||||||
5 | a sale for resale and not a sale at retail. A
tire supplier who | ||||||
6 | enters into such an arrangement with a tire retailer shall
be | ||||||
7 | liable for the tax on all tires sold to the tire retailer and | ||||||
8 | must (i)
provide the tire retailer with a receipt that | ||||||
9 | separately reflects the tire
tax collected from the retailer on | ||||||
10 | each transaction and (ii) accept used tires
for recycling from | ||||||
11 | the retailer's customers. The tire supplier shall be
entitled | ||||||
12 | to the collection allowance of 10 cents per tire.
| ||||||
13 | The retailer of the tires must maintain in its books and | ||||||
14 | records evidence
that the appropriate fee was paid to the tire | ||||||
15 | supplier and that the tire
supplier has agreed to remit the fee | ||||||
16 | to the Department of Revenue for each tire
sold by the | ||||||
17 | retailer. Otherwise, the tire retailer shall be directly liable
| ||||||
18 | for the fee on all tires sold at retail. Tire retailers paying | ||||||
19 | the fee to
their suppliers are not entitled to the collection | ||||||
20 | allowance of 10 cents per
tire.
| ||||||
21 | (d) The requirements of subsection (a) of this Section | ||||||
22 | shall apply
exclusively to tires to be used for vehicles | ||||||
23 | defined in Section 1-217 of
the Illinois Vehicle Code, aircraft | ||||||
24 | tires, special mobile equipment, and
implements of husbandry.
| ||||||
25 | (e) The requirements of paragraph (1) of subsection (a) do | ||||||
26 | not
apply to the sale of reprocessed tires. For purposes of |
| |||||||
| |||||||
1 | this Section,
"reprocessed tire" means a used tire that has | ||||||
2 | been recapped, retreaded,
or regrooved and that has not been | ||||||
3 | placed on a vehicle wheel rim.
| ||||||
4 | (Source: P.A. 95-49, eff. 8-10-07; 95-331, eff. 8-21-07; | ||||||
5 | 95-876, eff. 8-21-08.)
| ||||||
6 | (415 ILCS 5/55.10) (from Ch. 111 1/2, par. 1055.10)
| ||||||
7 | Sec. 55.10. Tax returns by retailer. | ||||||
8 | (a) Except as otherwise provided in this Section, for | ||||||
9 | returns due on or before January 31, 2010, each Each retailer | ||||||
10 | of tires
maintaining a place of business in this State
shall | ||||||
11 | make a return to the Department of Revenue on a quarter annual | ||||||
12 | basis,
with the return for January, February and March of a | ||||||
13 | given year being due
by April 30 of that year; with the return | ||||||
14 | for April, May and June of a
given year being due by July 31 of | ||||||
15 | that year; with the return for July, August
and September of a | ||||||
16 | given year being due by October 31 of that year; and
with the | ||||||
17 | return for October, November and December of a given year being | ||||||
18 | due
by January 31 of the following year.
| ||||||
19 | For returns due after January 31, 2010, each retailer of | ||||||
20 | tires maintaining a place of business in this State shall make | ||||||
21 | a return to the Department of Revenue on a quarter annual | ||||||
22 | basis, with the return for January, February, and March of a | ||||||
23 | given year being due by April 20 of that year; with the return | ||||||
24 | for April, May, and June of a given year being due by July 20 of | ||||||
25 | that year; with the return for July, August, and September of a |
| |||||||
| |||||||
1 | given year being due by October 20 of that year; and with the | ||||||
2 | return for October, November, and December of a given year | ||||||
3 | being due by January 20 of the following year. | ||||||
4 | Notwithstanding any other provision of this Section to the | ||||||
5 | contrary, the return for October, November, and December of | ||||||
6 | 2009 is due by February 20, 2010. | ||||||
7 | (b) Each return made to the Department of Revenue shall | ||||||
8 | state:
| ||||||
9 | (1) the name of the retailer;
| ||||||
10 | (2) the address of the retailer's principal place of | ||||||
11 | business, and the
address of the principal place of | ||||||
12 | business (if that is a different address)
from which the | ||||||
13 | retailer engages in the business of making retail sales of
| ||||||
14 | tires;
| ||||||
15 | (3) total number of tires sold at retail for the | ||||||
16 | preceding calendar
quarter;
| ||||||
17 | (4) the amount of tax due; and
| ||||||
18 | (5) such other reasonable information as the | ||||||
19 | Department of Revenue
may require.
| ||||||
20 | Notwithstanding any other provision of this Act concerning | ||||||
21 | the time
within which a retailer may file his return, in the | ||||||
22 | case of any retailer
who ceases to engage in the retail sale of | ||||||
23 | tires, the retailer shall file
a final return under this Act | ||||||
24 | with the Department of Revenue not more than
one month after | ||||||
25 | discontinuing that business.
| ||||||
26 | (Source: P.A. 87-727.)
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| |||||||
1 | Section 99. Effective date. This Act takes effect upon | ||||||
2 | becoming law.
|