Sen. Chris Lauzen

Filed: 3/11/2011

 

 


 

 


 
09700SB2245sam001LRB097 10363 HLH 51445 a

1
AMENDMENT TO SENATE BILL 2245

2    AMENDMENT NO. ______. Amend Senate Bill 2245 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Income Tax Act is amended by
5adding Section 221 as follows:
 
6    (35 ILCS 5/221 new)
7    Sec. 221. Educational Improvement Tax Credit.
8    (a) The General Assembly finds and declares that the
9Constitution of the State of Illinois provides that a
10"fundamental goal of the People of the State is the educational
11development of all persons to the limits of their capacities",
12and that the educational development of every school student
13serves the public purposes of the State. In order to enable
14Illinois students to develop "to the limits of their
15capacities", all students must have access to expanded
16educational opportunities. This Section is in the public

 

 

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1interest, for the public benefit, and serves a secular purpose.
2    (b) An educational improvement tax credit program is hereby
3established to enhance the educational opportunities available
4to all students in this State.
5    For tax years beginning after December 31, 2011, a taxpayer
6shall be allowed a credit, not in excess of $100,000, against
7the tax imposed by subsections (a) and (b) of Section 201 of
8this Act for contributions to a qualified student assistance
9organization in the taxable year in which the contribution is
10made. The credit shall not exceed 90% of each dollar
11contributed during the taxable year by the taxpayer. For
12partners, shareholders of Subchapter S corporations, and
13owners of limited liability companies, if the liability company
14is treated as a partnership for purposes of federal and State
15income taxation, there shall be allowed a credit under this
16Section to be determined in accordance with the determination
17of income and distributive share of income under Section 702
18and 704 and Subchapter S of the Internal Revenue Code.
19    In no event may any credit be claimed for amounts deducted
20pursuant to Section 170 of the Internal Revenue Code in
21arriving at taxable income.
22    (c) For purposes of this Section:
23    "Contribution" means a donation of cash.
24    "Qualified student assistance organization" means a
25nonprofit entity that:
26        (1) is exempt from federal taxation under Section

 

 

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1    501(c)(3) of the Internal Revenue Code of 1986 and any
2    similar provision of a later compilation; and
3        (2) contributes at least 90% of its annual receipts, as
4    required by the by-laws of the organization and as
5    documented by the nonprofit organizations annual AG990-IL
6    Charitable Organization Annual Report, or, if the
7    organization is exempt from filing such a report, by a
8    report containing identical information to that contained
9    in the AG990-IL and certified by the President and
10    Treasurer of the organization, or alternatively, two
11    trustees of the organization, either to scholarships for
12    qualifying students at a school or to enhance educational
13    options for qualifying students by providing qualifying
14    students access to secular, neutral, non-ideological
15    programs, or activities outside the curriculum or academic
16    program of a school, as long as the program or activities
17    meet the requirements set forth in rules promulgated by the
18    Illinois State Board of Education. An entity that has been
19    in existence less than 2 years prior to the filing of an
20    application under subsection (f) of this Section shall meet
21    the requirements of this subsection if its charter, bylaws
22    or other governing instrument requires that it contribute
23    90% of its annual receipts for the purposes described in
24    this subsection.
25    "Qualifying student" means an individual who:
26        (1) is a resident of the State of Illinois;

 

 

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1        (2) is under the age of 21 during the calendar year for
2    which a credit is sought;
3        (3) during the calendar year for which a credit is
4    sought is a full-time pupil enrolled in a kindergarten
5    through 12th grade education program at any school, as
6    defined in this subsection (c); and
7        (4) is a child of a parent or parents, or is under the
8    legal guardianship of an individual or individuals, with a
9    base income of not more than $50,000 and resides in the
10    household with those parents or guardians, provided that if
11    there is more than one dependent member of the household
12    under the age of 21, counting the qualifying student, then
13    this annual income requirement shall be increased by
14    $10,000 for each dependent member of the household under
15    the age of 21 in excess of the one qualifying student.
16    Qualified student assistant organizations shall be
17    responsible for determining whether a student is a
18    qualifying student, pursuant to rules adopted by the
19    Illinois State Board of Education.
20    "School" means any public or State-recognized non-public
21elementary or secondary school in Illinois that is in
22compliance with Title VI of the Civil Rights Act of 1964 and
23attendance at which satisfies the requirements of Section 26-1
24of the School Code.
25    (d) No tax credit established by this Section is allowed if
26the taxpayer designates a contribution to a student assistance

 

 

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1organization for the direct benefit of any particular
2qualifying student.
3    (e) Qualified student assistance organizations shall
4provide scholarships or funding for enhanced educational
5options without limiting availability to only students of one
6school.
7    (f) A tax credit granted under this Section that is not
8used in the taxable year in which the contribution was made
9shall not be carried forward or carried back and is not
10refundable or transferable.
11    (g) A taxpayer must apply annually to the Department and
12receive approval for a tax credit under this Section prior to
13making a contribution to a student assistance organization.
14Applicants must be submitted to the Department no later than
15March 31 each year for contributions to be made for tax years
16ending on or after July 1 of that same year. On May 1 of each
17year, the Department shall, on a random basis, select
18applications until the total aggregate amount of all requested
19tax credits equals the maximum provided for in subsection (h).
20The Department shall adopt rules pursuant to the requirements
21of the Illinois Administrative Procedure Act that set forth the
22information the Department can require on the tax credit
23application and the manner in which the tax credit lottery is
24to be conducted.
25    (h) The total aggregate amount of all approved tax credits
26shall not exceed $30,000,000 in any State fiscal year.

 

 

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1    (i) The Department shall adopt rules consistent with this
2Section for the administration of the educational improvement
3tax credit program.
4    (j) A scholarship received by a qualifying student shall
5not be considered to be taxable income.
6    (k) This Section is exempt from the provisions of Section
7250.
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.".