| |||||||
| |||||||
| |||||||
1 | AN ACT concerning revenue.
| ||||||
2 | Be it enacted by the People of the State of Illinois,
| ||||||
3 | represented in the General Assembly:
| ||||||
4 | Section 5. The Illinois Income Tax Act is amended by | ||||||
5 | changing Sections 303, 304, and 710 as follows:
| ||||||
6 | (35 ILCS 5/303) (from Ch. 120, par. 3-303)
| ||||||
7 | Sec. 303. (a) In general. Any item of capital gain or loss, | ||||||
8 | and any
item of income from rents or royalties from real or | ||||||
9 | tangible personal
property, interest, dividends, and patent or | ||||||
10 | copyright royalties, and prizes
awarded under the Illinois | ||||||
11 | Lottery Law, and, for taxable years ending on or after December | ||||||
12 | 31, 2019, wagering and gambling winnings from Illinois sources | ||||||
13 | as set forth in subsection (e), to the extent such item | ||||||
14 | constitutes
nonbusiness income, together with any item of | ||||||
15 | deduction directly allocable
thereto, shall be allocated by any | ||||||
16 | person other than a resident as provided
in this Section.
| ||||||
17 | (b) Capital gains and losses. | ||||||
18 | (1) Real property. Capital gains and
losses from sales | ||||||
19 | or exchanges of real property are allocable to this State
| ||||||
20 | if the property is located in this State.
| ||||||
21 | (2) Tangible personal property. Capital gains and | ||||||
22 | losses from sales
or exchanges of tangible personal | ||||||
23 | property are allocable to this State if,
at the time of |
| |||||||
| |||||||
1 | such sale or exchange:
| ||||||
2 | (A) The property had its situs in this State; or
| ||||||
3 | (B) The taxpayer had its commercial domicile in | ||||||
4 | this State and was not
taxable in the state in which | ||||||
5 | the property had its situs.
| ||||||
6 | (3) Intangibles. Capital gains and losses from sales or | ||||||
7 | exchanges of
intangible personal property are allocable to | ||||||
8 | this State if the taxpayer
had its commercial domicile in | ||||||
9 | this State at the time of such sale or
exchange.
| ||||||
10 | (c) Rents and royalties. | ||||||
11 | (1) Real property. Rents and royalties
from real | ||||||
12 | property are allocable to this State if the property is | ||||||
13 | located
in this State.
| ||||||
14 | (2) Tangible personal property. Rents and royalties | ||||||
15 | from tangible
personal property are allocable to this | ||||||
16 | State:
| ||||||
17 | (A) If and to the extent that the property is | ||||||
18 | utilized in this State; or
| ||||||
19 | (B) In their entirety if, at the time such rents or | ||||||
20 | royalties were paid
or accrued, the taxpayer had its | ||||||
21 | commercial domicile in this State and was
not organized | ||||||
22 | under the laws of or taxable with respect to such rents | ||||||
23 | or
royalties in the state in which the property was | ||||||
24 | utilized.
The extent of utilization of tangible | ||||||
25 | personal property in a state is
determined by | ||||||
26 | multiplying the rents or royalties derived from such |
| |||||||
| |||||||
1 | property
by a fraction, the numerator of which is the | ||||||
2 | number of days of physical
location of the property in | ||||||
3 | the state during the rental or royalty period
in the | ||||||
4 | taxable year and the denominator of which is the number | ||||||
5 | of days of
physical location of the property everywhere | ||||||
6 | during all rental or royalty
periods in the taxable | ||||||
7 | year. If the physical location of the property
during | ||||||
8 | the rental or royalty period is unknown or | ||||||
9 | unascertainable by the
taxpayer, tangible personal | ||||||
10 | property is utilized in the state in which the
property | ||||||
11 | was located at the time the rental or royalty payer | ||||||
12 | obtained
possession.
| ||||||
13 | (d) Patent and copyright royalties.
| ||||||
14 | (1) Allocation. Patent and copyright royalties are | ||||||
15 | allocable to this
State:
| ||||||
16 | (A) If and to the extent that the patent or | ||||||
17 | copyright is utilized by the
payer in this State; or
| ||||||
18 | (B) If and to the extent that the patent or | ||||||
19 | copyright is utilized by the
payer in a state in which | ||||||
20 | the taxpayer is not taxable with respect to such
| ||||||
21 | royalties and, at the time such royalties were paid or | ||||||
22 | accrued, the
taxpayer had its commercial domicile in | ||||||
23 | this State.
| ||||||
24 | (2) Utilization.
| ||||||
25 | (A) A patent is utilized in a state to the extent | ||||||
26 | that it is employed in
production, fabrication, |
| |||||||
| |||||||
1 | manufacturing or other processing in the state or
to | ||||||
2 | the extent that a patented product is produced in the | ||||||
3 | state. If the
basis of receipts from patent royalties | ||||||
4 | does not permit allocation to
states or if the | ||||||
5 | accounting procedures do not reflect states of
| ||||||
6 | utilization, the patent is utilized in this State if | ||||||
7 | the taxpayer has its
commercial domicile in this State.
| ||||||
8 | (B) A copyright is utilized in a state to the | ||||||
9 | extent that printing or
other publication originates | ||||||
10 | in the state. If the basis of receipts from
copyright | ||||||
11 | royalties does not permit allocation to states or if | ||||||
12 | the
accounting procedures do not reflect states of | ||||||
13 | utilization, the copyright
is utilized in this State if | ||||||
14 | the taxpayer has its commercial domicile in
this State.
| ||||||
15 | (e) Illinois lottery ; wagering and gambling winnings | ||||||
16 | prizes . Prizes awarded under the Illinois Lottery Law are | ||||||
17 | allocable to this State. Payments received in taxable years | ||||||
18 | ending on or after December 31, 2013, from the assignment of a | ||||||
19 | prize under Section 13.1 of the Illinois Lottery Law are | ||||||
20 | allocable to this State. For taxable years ending on or after | ||||||
21 | December 31, 2019, payments of winnings from pari-mutuel | ||||||
22 | wagering conducted at a wagering facility licensed under the | ||||||
23 | Illinois Horse Racing Act of 1975 and from gambling games | ||||||
24 | conducted on a riverboat licensed under the Riverboat Gambling | ||||||
25 | Act are allocable to this State.
| ||||||
26 | (e-5) Unemployment benefits. Unemployment benefits paid by |
| |||||||
| |||||||
1 | the Illinois Department of Employment Security are allocable to | ||||||
2 | this State. | ||||||
3 | (f) Taxability in other state. For purposes of allocation | ||||||
4 | of income
pursuant to this Section, a taxpayer is taxable in | ||||||
5 | another state if:
| ||||||
6 | (1) In that state he is subject to a net income tax, a | ||||||
7 | franchise tax
measured by net income, a franchise tax for | ||||||
8 | the privilege of doing
business, or a corporate stock tax; | ||||||
9 | or
| ||||||
10 | (2) That state has jurisdiction to subject the taxpayer | ||||||
11 | to a net income
tax regardless of whether, in fact, the | ||||||
12 | state does or does not.
| ||||||
13 | (g) Cross references. | ||||||
14 | (1) For allocation of interest and dividends by
persons | ||||||
15 | other than residents, see Section 301(c)(2).
| ||||||
16 | (2) For allocation of nonbusiness income by residents, | ||||||
17 | see Section
301(a).
| ||||||
18 | (Source: P.A. 97-709, eff. 7-1-12; 98-496, eff. 1-1-14.)
| ||||||
19 | (35 ILCS 5/304) (from Ch. 120, par. 3-304)
| ||||||
20 | Sec. 304. Business income of persons other than residents.
| ||||||
21 | (a) In general. The business income of a person other than | ||||||
22 | a
resident shall be allocated to this State if such person's | ||||||
23 | business
income is derived solely from this State. If a person | ||||||
24 | other than a
resident derives business income from this State | ||||||
25 | and one or more other
states, then, for tax years ending on or |
| |||||||
| |||||||
1 | before December 30, 1998, and
except as otherwise provided by | ||||||
2 | this Section, such
person's business income shall be | ||||||
3 | apportioned to this State by
multiplying the income by a | ||||||
4 | fraction, the numerator of which is the sum
of the property | ||||||
5 | factor (if any), the payroll factor (if any) and 200% of the
| ||||||
6 | sales factor (if any), and the denominator of which is 4 | ||||||
7 | reduced by the
number of factors other than the sales factor | ||||||
8 | which have a denominator
of zero and by an additional 2 if the | ||||||
9 | sales factor has a denominator of zero.
For tax years ending on | ||||||
10 | or after December 31, 1998, and except as otherwise
provided by | ||||||
11 | this Section, persons other than
residents who derive business | ||||||
12 | income from this State and one or more other
states shall | ||||||
13 | compute their apportionment factor by weighting their | ||||||
14 | property,
payroll, and sales factors as provided in
subsection | ||||||
15 | (h) of this Section.
| ||||||
16 | (1) Property factor.
| ||||||
17 | (A) The property factor is a fraction, the numerator of | ||||||
18 | which is the
average value of the person's real and | ||||||
19 | tangible personal property owned
or rented and used in the | ||||||
20 | trade or business in this State during the
taxable year and | ||||||
21 | the denominator of which is the average value of all
the | ||||||
22 | person's real and tangible personal property owned or | ||||||
23 | rented and
used in the trade or business during the taxable | ||||||
24 | year.
| ||||||
25 | (B) Property owned by the person is valued at its | ||||||
26 | original cost.
Property rented by the person is valued at 8 |
| |||||||
| |||||||
1 | times the net annual rental
rate. Net annual rental rate is | ||||||
2 | the annual rental rate paid by the
person less any annual | ||||||
3 | rental rate received by the person from
sub-rentals.
| ||||||
4 | (C) The average value of property shall be determined | ||||||
5 | by averaging
the values at the beginning and ending of the | ||||||
6 | taxable year but the
Director may require the averaging of | ||||||
7 | monthly values during the taxable
year if reasonably | ||||||
8 | required to reflect properly the average value of the
| ||||||
9 | person's property.
| ||||||
10 | (2) Payroll factor.
| ||||||
11 | (A) The payroll factor is a fraction, the numerator of | ||||||
12 | which is the
total amount paid in this State during the | ||||||
13 | taxable year by the person
for compensation, and the | ||||||
14 | denominator of which is the total compensation
paid | ||||||
15 | everywhere during the taxable year.
| ||||||
16 | (B) Compensation is paid in this State if:
| ||||||
17 | (i) The individual's service is performed entirely | ||||||
18 | within this
State;
| ||||||
19 | (ii) The individual's service is performed both | ||||||
20 | within and without
this State, but the service | ||||||
21 | performed without this State is incidental
to the | ||||||
22 | individual's service performed within this State; or
| ||||||
23 | (iii) Some of the service is performed within this | ||||||
24 | State and either
the base of operations, or if there is | ||||||
25 | no base of operations, the place
from which the service | ||||||
26 | is directed or controlled is within this State,
or the |
| |||||||
| |||||||
1 | base of operations or the place from which the service | ||||||
2 | is
directed or controlled is not in any state in which | ||||||
3 | some part of the
service is performed, but the | ||||||
4 | individual's residence is in this State.
| ||||||
5 | (iv) Compensation paid to nonresident professional | ||||||
6 | athletes. | ||||||
7 | (a) General. The Illinois source income of a | ||||||
8 | nonresident individual who is a member of a | ||||||
9 | professional athletic team includes the portion of the | ||||||
10 | individual's total compensation for services performed | ||||||
11 | as a member of a professional athletic team during the | ||||||
12 | taxable year which the number of duty days spent within | ||||||
13 | this State performing services for the team in any | ||||||
14 | manner during the taxable year bears to the total | ||||||
15 | number of duty days spent both within and without this | ||||||
16 | State during the taxable year. | ||||||
17 | (b) Travel days. Travel days that do not involve | ||||||
18 | either a game, practice, team meeting, or other similar | ||||||
19 | team event are not considered duty days spent in this | ||||||
20 | State. However, such travel days are considered in the | ||||||
21 | total duty days spent both within and without this | ||||||
22 | State. | ||||||
23 | (c) Definitions. For purposes of this subpart | ||||||
24 | (iv): | ||||||
25 | (1) The term "professional athletic team" | ||||||
26 | includes, but is not limited to, any professional |
| |||||||
| |||||||
1 | baseball, basketball, football, soccer, or hockey | ||||||
2 | team. | ||||||
3 | (2) The term "member of a professional | ||||||
4 | athletic team" includes those employees who are | ||||||
5 | active players, players on the disabled list, and | ||||||
6 | any other persons required to travel and who travel | ||||||
7 | with and perform services on behalf of a | ||||||
8 | professional athletic team on a regular basis. | ||||||
9 | This includes, but is not limited to, coaches, | ||||||
10 | managers, and trainers. | ||||||
11 | (3) Except as provided in items (C) and (D) of | ||||||
12 | this subpart (3), the term "duty days" means all | ||||||
13 | days during the taxable year from the beginning of | ||||||
14 | the professional athletic team's official | ||||||
15 | pre-season training period through the last game | ||||||
16 | in which the team competes or is scheduled to | ||||||
17 | compete. Duty days shall be counted for the year in | ||||||
18 | which they occur, including where a team's | ||||||
19 | official pre-season training period through the | ||||||
20 | last game in which the team competes or is | ||||||
21 | scheduled to compete, occurs during more than one | ||||||
22 | tax year. | ||||||
23 | (A) Duty days shall also include days on | ||||||
24 | which a member of a professional athletic team | ||||||
25 | performs service for a team on a date that does | ||||||
26 | not fall within the foregoing period (e.g., |
| |||||||
| |||||||
1 | participation in instructional leagues, the | ||||||
2 | "All Star Game", or promotional "caravans"). | ||||||
3 | Performing a service for a professional | ||||||
4 | athletic team includes conducting training and | ||||||
5 | rehabilitation activities, when such | ||||||
6 | activities are conducted at team facilities. | ||||||
7 | (B) Also included in duty days are game | ||||||
8 | days, practice days, days spent at team | ||||||
9 | meetings, promotional caravans, preseason | ||||||
10 | training camps, and days served with the team | ||||||
11 | through all post-season games in which the team | ||||||
12 | competes or is scheduled to compete. | ||||||
13 | (C) Duty days for any person who joins a | ||||||
14 | team during the period from the beginning of | ||||||
15 | the professional athletic team's official | ||||||
16 | pre-season training period through the last | ||||||
17 | game in which the team competes, or is | ||||||
18 | scheduled to compete, shall begin on the day | ||||||
19 | that person joins the team. Conversely, duty | ||||||
20 | days for any person who leaves a team during | ||||||
21 | this period shall end on the day that person | ||||||
22 | leaves the team. Where a person switches teams | ||||||
23 | during a taxable year, a separate duty-day | ||||||
24 | calculation shall be made for the period the | ||||||
25 | person was with each team. | ||||||
26 | (D) Days for which a member of a |
| |||||||
| |||||||
1 | professional athletic team is not compensated | ||||||
2 | and is not performing services for the team in | ||||||
3 | any manner, including days when such member of | ||||||
4 | a professional athletic team has been | ||||||
5 | suspended without pay and prohibited from | ||||||
6 | performing any services for the team, shall not | ||||||
7 | be treated as duty days. | ||||||
8 | (E) Days for which a member of a | ||||||
9 | professional athletic team is on the disabled | ||||||
10 | list and does not conduct rehabilitation | ||||||
11 | activities at facilities of the team, and is | ||||||
12 | not otherwise performing services for the team | ||||||
13 | in Illinois, shall not be considered duty days | ||||||
14 | spent in this State. All days on the disabled | ||||||
15 | list, however, are considered to be included in | ||||||
16 | total duty days spent both within and without | ||||||
17 | this State. | ||||||
18 | (4) The term "total compensation for services | ||||||
19 | performed as a member of a professional athletic | ||||||
20 | team" means the total compensation received during | ||||||
21 | the taxable year for services performed: | ||||||
22 | (A) from the beginning of the official | ||||||
23 | pre-season training period through the last | ||||||
24 | game in which the team competes or is scheduled | ||||||
25 | to compete during that taxable year; and | ||||||
26 | (B) during the taxable year on a date which |
| |||||||
| |||||||
1 | does not fall within the foregoing period | ||||||
2 | (e.g., participation in instructional leagues, | ||||||
3 | the "All Star Game", or promotional caravans). | ||||||
4 | This compensation shall include, but is not | ||||||
5 | limited to, salaries, wages, bonuses as described | ||||||
6 | in this subpart, and any other type of compensation | ||||||
7 | paid during the taxable year to a member of a | ||||||
8 | professional athletic team for services performed | ||||||
9 | in that year. This compensation does not include | ||||||
10 | strike benefits, severance pay, termination pay, | ||||||
11 | contract or option year buy-out payments, | ||||||
12 | expansion or relocation payments, or any other | ||||||
13 | payments not related to services performed for the | ||||||
14 | team. | ||||||
15 | For purposes of this subparagraph, "bonuses" | ||||||
16 | included in "total compensation for services | ||||||
17 | performed as a member of a professional athletic | ||||||
18 | team" subject to the allocation described in | ||||||
19 | Section 302(c)(1) are: bonuses earned as a result | ||||||
20 | of play (i.e., performance bonuses) during the | ||||||
21 | season, including bonuses paid for championship, | ||||||
22 | playoff or "bowl" games played by a team, or for | ||||||
23 | selection to all-star league or other honorary | ||||||
24 | positions; and bonuses paid for signing a | ||||||
25 | contract, unless the payment of the signing bonus | ||||||
26 | is not conditional upon the signee playing any |
| |||||||
| |||||||
1 | games for the team or performing any subsequent | ||||||
2 | services for the team or even making the team, the | ||||||
3 | signing bonus is payable separately from the | ||||||
4 | salary and any other compensation, and the signing | ||||||
5 | bonus is nonrefundable.
| ||||||
6 | (3) Sales factor.
| ||||||
7 | (A) The sales factor is a fraction, the numerator of | ||||||
8 | which is the
total sales of the person in this State during | ||||||
9 | the taxable year, and the
denominator of which is the total | ||||||
10 | sales of the person everywhere during
the taxable year.
| ||||||
11 | (B) Sales of tangible personal property are in this | ||||||
12 | State if:
| ||||||
13 | (i) The property is delivered or shipped to a | ||||||
14 | purchaser, other than
the United States government, | ||||||
15 | within this State regardless of the f. o.
b. point or | ||||||
16 | other conditions of the sale; or
| ||||||
17 | (ii) The property is shipped from an office, store, | ||||||
18 | warehouse,
factory or other place of storage in this | ||||||
19 | State and either the purchaser
is the United States | ||||||
20 | government or the person is not taxable in the
state of | ||||||
21 | the purchaser; provided, however, that premises owned | ||||||
22 | or leased
by a person who has independently contracted | ||||||
23 | with the seller for the printing
of newspapers, | ||||||
24 | periodicals or books shall not be deemed to be an | ||||||
25 | office,
store, warehouse, factory or other place of | ||||||
26 | storage for purposes of this
Section.
Sales of tangible |
| |||||||
| |||||||
1 | personal property are not in this State if the
seller | ||||||
2 | and purchaser would be members of the same unitary | ||||||
3 | business group
but for the fact that either the seller | ||||||
4 | or purchaser is a person with 80%
or more of total | ||||||
5 | business activity outside of the United States and the
| ||||||
6 | property is purchased for resale.
| ||||||
7 | (B-1) Patents, copyrights, trademarks, and similar | ||||||
8 | items of intangible
personal property.
| ||||||
9 | (i) Gross receipts from the licensing, sale, or | ||||||
10 | other disposition of a
patent, copyright, trademark, | ||||||
11 | or similar item of intangible personal property, other | ||||||
12 | than gross receipts governed by paragraph (B-7) of this | ||||||
13 | item (3),
are in this State to the extent the item is | ||||||
14 | utilized in this State during the
year the gross | ||||||
15 | receipts are included in gross income.
| ||||||
16 | (ii) Place of utilization.
| ||||||
17 | (I) A patent is utilized in a state to the | ||||||
18 | extent that it is employed
in production, | ||||||
19 | fabrication, manufacturing, or other processing in | ||||||
20 | the state or
to the extent that a patented product | ||||||
21 | is produced in the state. If a patent is
utilized | ||||||
22 | in
more than one state, the extent to which it is | ||||||
23 | utilized in any one state shall
be a fraction equal | ||||||
24 | to the gross receipts of the licensee or purchaser | ||||||
25 | from
sales or leases of items produced, | ||||||
26 | fabricated, manufactured, or processed
within that |
| |||||||
| |||||||
1 | state using the patent and of patented items | ||||||
2 | produced within that
state, divided by the total of | ||||||
3 | such gross receipts for all states in which the
| ||||||
4 | patent is utilized.
| ||||||
5 | (II) A copyright is utilized in a state to the | ||||||
6 | extent that printing or
other publication | ||||||
7 | originates in the state. If a copyright is utilized | ||||||
8 | in more
than one state, the extent to which it is | ||||||
9 | utilized in any one state shall be a
fraction equal | ||||||
10 | to the gross receipts from sales or licenses of | ||||||
11 | materials
printed or published in that state | ||||||
12 | divided by the total of such gross receipts
for all | ||||||
13 | states in which the copyright is utilized.
| ||||||
14 | (III) Trademarks and other items of intangible | ||||||
15 | personal property
governed by this paragraph (B-1) | ||||||
16 | are utilized in the state in which the
commercial | ||||||
17 | domicile of the licensee or purchaser is located.
| ||||||
18 | (iii) If the state of utilization of an item of | ||||||
19 | property governed by
this paragraph (B-1) cannot be | ||||||
20 | determined from the taxpayer's books and
records or | ||||||
21 | from the books and records of any person related to the | ||||||
22 | taxpayer
within the meaning of Section 267(b) of the | ||||||
23 | Internal Revenue Code, 26 U.S.C.
267, the gross
| ||||||
24 | receipts attributable to that item shall be excluded | ||||||
25 | from both the numerator
and the denominator of the | ||||||
26 | sales factor.
|
| |||||||
| |||||||
1 | (B-2) Gross receipts from the license, sale, or other | ||||||
2 | disposition of
patents, copyrights, trademarks, and | ||||||
3 | similar items of intangible personal
property, other than | ||||||
4 | gross receipts governed by paragraph (B-7) of this item | ||||||
5 | (3), may be included in the numerator or denominator of the | ||||||
6 | sales factor
only if gross receipts from licenses, sales, | ||||||
7 | or other disposition of such items
comprise more than 50% | ||||||
8 | of the taxpayer's total gross receipts included in gross
| ||||||
9 | income during the tax year and during each of the 2 | ||||||
10 | immediately preceding tax
years; provided that, when a | ||||||
11 | taxpayer is a member of a unitary business group,
such | ||||||
12 | determination shall be made on the basis of the gross | ||||||
13 | receipts of the
entire unitary business group.
| ||||||
14 | (B-5) For taxable years ending on or after December 31, | ||||||
15 | 2008, except as provided in subsections (ii) through (vii), | ||||||
16 | receipts from the sale of telecommunications service or | ||||||
17 | mobile telecommunications service are in this State if the | ||||||
18 | customer's service address is in this State. | ||||||
19 | (i) For purposes of this subparagraph (B-5), the | ||||||
20 | following terms have the following meanings: | ||||||
21 | "Ancillary services" means services that are | ||||||
22 | associated with or incidental to the provision of | ||||||
23 | "telecommunications services", including but not | ||||||
24 | limited to "detailed telecommunications billing", | ||||||
25 | "directory assistance", "vertical service", and "voice | ||||||
26 | mail services". |
| |||||||
| |||||||
1 | "Air-to-Ground Radiotelephone service" means a | ||||||
2 | radio service, as that term is defined in 47 CFR 22.99, | ||||||
3 | in which common carriers are authorized to offer and | ||||||
4 | provide radio telecommunications service for hire to | ||||||
5 | subscribers in aircraft. | ||||||
6 | "Call-by-call Basis" means any method of charging | ||||||
7 | for telecommunications services where the price is | ||||||
8 | measured by individual calls. | ||||||
9 | "Communications Channel" means a physical or | ||||||
10 | virtual path of communications over which signals are | ||||||
11 | transmitted between or among customer channel | ||||||
12 | termination points. | ||||||
13 | "Conference bridging service" means an "ancillary | ||||||
14 | service" that links two or more participants of an | ||||||
15 | audio or video conference call and may include the | ||||||
16 | provision of a telephone number. "Conference bridging | ||||||
17 | service" does not include the "telecommunications | ||||||
18 | services" used to reach the conference bridge. | ||||||
19 | "Customer Channel Termination Point" means the | ||||||
20 | location where the customer either inputs or receives | ||||||
21 | the communications. | ||||||
22 | "Detailed telecommunications billing service" | ||||||
23 | means an "ancillary service" of separately stating | ||||||
24 | information pertaining to individual calls on a | ||||||
25 | customer's billing statement. | ||||||
26 | "Directory assistance" means an "ancillary |
| |||||||
| |||||||
1 | service" of providing telephone number information, | ||||||
2 | and/or address information. | ||||||
3 | "Home service provider" means the facilities based | ||||||
4 | carrier or reseller with which the customer contracts | ||||||
5 | for the provision of mobile telecommunications | ||||||
6 | services. | ||||||
7 | "Mobile telecommunications service" means | ||||||
8 | commercial mobile radio service, as defined in Section | ||||||
9 | 20.3 of Title 47 of the Code of Federal Regulations as | ||||||
10 | in effect on June 1, 1999. | ||||||
11 | "Place of primary use" means the street address | ||||||
12 | representative of where the customer's use of the | ||||||
13 | telecommunications service primarily occurs, which | ||||||
14 | must be the residential street address or the primary | ||||||
15 | business street address of the customer. In the case of | ||||||
16 | mobile telecommunications services, "place of primary | ||||||
17 | use" must be within the licensed service area of the | ||||||
18 | home service provider. | ||||||
19 | "Post-paid telecommunication service" means the | ||||||
20 | telecommunications service obtained by making a | ||||||
21 | payment on a call-by-call basis either through the use | ||||||
22 | of a credit card or payment mechanism such as a bank | ||||||
23 | card, travel card, credit card, or debit card, or by | ||||||
24 | charge made to a telephone number which is not | ||||||
25 | associated with the origination or termination of the | ||||||
26 | telecommunications service. A post-paid calling |
| |||||||
| |||||||
1 | service includes telecommunications service, except a | ||||||
2 | prepaid wireless calling service, that would be a | ||||||
3 | prepaid calling service except it is not exclusively a | ||||||
4 | telecommunication service. | ||||||
5 | "Prepaid telecommunication service" means the | ||||||
6 | right to access exclusively telecommunications | ||||||
7 | services, which must be paid for in advance and which | ||||||
8 | enables the origination of calls using an access number | ||||||
9 | or authorization code, whether manually or | ||||||
10 | electronically dialed, and that is sold in | ||||||
11 | predetermined units or dollars of which the number | ||||||
12 | declines with use in a known amount. | ||||||
13 | "Prepaid Mobile telecommunication service" means a | ||||||
14 | telecommunications service that provides the right to | ||||||
15 | utilize mobile wireless service as well as other | ||||||
16 | non-telecommunication services, including but not | ||||||
17 | limited to ancillary services, which must be paid for | ||||||
18 | in advance that is sold in predetermined units or | ||||||
19 | dollars of which the number declines with use in a | ||||||
20 | known amount. | ||||||
21 | "Private communication service" means a | ||||||
22 | telecommunication service that entitles the customer | ||||||
23 | to exclusive or priority use of a communications | ||||||
24 | channel or group of channels between or among | ||||||
25 | termination points, regardless of the manner in which | ||||||
26 | such channel or channels are connected, and includes |
| |||||||
| |||||||
1 | switching capacity, extension lines, stations, and any | ||||||
2 | other associated services that are provided in | ||||||
3 | connection with the use of such channel or channels. | ||||||
4 | "Service address" means: | ||||||
5 | (a) The location of the telecommunications | ||||||
6 | equipment to which a customer's call is charged and | ||||||
7 | from which the call originates or terminates, | ||||||
8 | regardless of where the call is billed or paid; | ||||||
9 | (b) If the location in line (a) is not known, | ||||||
10 | service address means the origination point of the | ||||||
11 | signal of the telecommunications services first | ||||||
12 | identified by either the seller's | ||||||
13 | telecommunications system or in information | ||||||
14 | received by the seller from its service provider | ||||||
15 | where the system used to transport such signals is | ||||||
16 | not that of the seller; and | ||||||
17 | (c) If the locations in line (a) and line (b) | ||||||
18 | are not known, the service address means the | ||||||
19 | location of the customer's place of primary use. | ||||||
20 | "Telecommunications service" means the electronic | ||||||
21 | transmission, conveyance, or routing of voice, data, | ||||||
22 | audio, video, or any other information or signals to a | ||||||
23 | point, or between or among points. The term | ||||||
24 | "telecommunications service" includes such | ||||||
25 | transmission, conveyance, or routing in which computer | ||||||
26 | processing applications are used to act on the form, |
| |||||||
| |||||||
1 | code or protocol of the content for purposes of | ||||||
2 | transmission, conveyance or routing without regard to | ||||||
3 | whether such service is referred to as voice over | ||||||
4 | Internet protocol services or is classified by the | ||||||
5 | Federal Communications Commission as enhanced or value | ||||||
6 | added. "Telecommunications service" does not include: | ||||||
7 | (a) Data processing and information services | ||||||
8 | that allow data to be generated, acquired, stored, | ||||||
9 | processed, or retrieved and delivered by an | ||||||
10 | electronic transmission to a purchaser when such | ||||||
11 | purchaser's primary purpose for the underlying | ||||||
12 | transaction is the processed data or information; | ||||||
13 | (b) Installation or maintenance of wiring or | ||||||
14 | equipment on a customer's premises; | ||||||
15 | (c) Tangible personal property; | ||||||
16 | (d) Advertising, including but not limited to | ||||||
17 | directory advertising; | ||||||
18 | (e) Billing and collection services provided | ||||||
19 | to third parties; | ||||||
20 | (f) Internet access service; | ||||||
21 | (g) Radio and television audio and video | ||||||
22 | programming services, regardless of the medium, | ||||||
23 | including the furnishing of transmission, | ||||||
24 | conveyance and routing of such services by the | ||||||
25 | programming service provider. Radio and television | ||||||
26 | audio and video programming services shall include |
| |||||||
| |||||||
1 | but not be limited to cable service as defined in | ||||||
2 | 47 USC 522(6) and audio and video programming | ||||||
3 | services delivered by commercial mobile radio | ||||||
4 | service providers, as defined in 47 CFR 20.3; | ||||||
5 | (h) "Ancillary services"; or | ||||||
6 | (i) Digital products "delivered | ||||||
7 | electronically", including but not limited to | ||||||
8 | software, music, video, reading materials or ring | ||||||
9 | tones. | ||||||
10 | "Vertical service" means an "ancillary service" | ||||||
11 | that is offered in connection with one or more | ||||||
12 | "telecommunications services", which offers advanced | ||||||
13 | calling features that allow customers to identify | ||||||
14 | callers and to manage multiple calls and call | ||||||
15 | connections, including "conference bridging services". | ||||||
16 | "Voice mail service" means an "ancillary service" | ||||||
17 | that enables the customer to store, send or receive | ||||||
18 | recorded messages. "Voice mail service" does not | ||||||
19 | include any "vertical services" that the customer may | ||||||
20 | be required to have in order to utilize the "voice mail | ||||||
21 | service". | ||||||
22 | (ii) Receipts from the sale of telecommunications | ||||||
23 | service sold on an individual call-by-call basis are in | ||||||
24 | this State if either of the following applies: | ||||||
25 | (a) The call both originates and terminates in | ||||||
26 | this State. |
| |||||||
| |||||||
1 | (b) The call either originates or terminates | ||||||
2 | in this State and the service address is located in | ||||||
3 | this State. | ||||||
4 | (iii) Receipts from the sale of postpaid | ||||||
5 | telecommunications service at retail are in this State | ||||||
6 | if the origination point of the telecommunication | ||||||
7 | signal, as first identified by the service provider's | ||||||
8 | telecommunication system or as identified by | ||||||
9 | information received by the seller from its service | ||||||
10 | provider if the system used to transport | ||||||
11 | telecommunication signals is not the seller's, is | ||||||
12 | located in this State. | ||||||
13 | (iv) Receipts from the sale of prepaid | ||||||
14 | telecommunications service or prepaid mobile | ||||||
15 | telecommunications service at retail are in this State | ||||||
16 | if the purchaser obtains the prepaid card or similar | ||||||
17 | means of conveyance at a location in this State. | ||||||
18 | Receipts from recharging a prepaid telecommunications | ||||||
19 | service or mobile telecommunications service is in | ||||||
20 | this State if the purchaser's billing information | ||||||
21 | indicates a location in this State. | ||||||
22 | (v) Receipts from the sale of private | ||||||
23 | communication services are in this State as follows: | ||||||
24 | (a) 100% of receipts from charges imposed at | ||||||
25 | each channel termination point in this State. | ||||||
26 | (b) 100% of receipts from charges for the total |
| |||||||
| |||||||
1 | channel mileage between each channel termination | ||||||
2 | point in this State. | ||||||
3 | (c) 50% of the total receipts from charges for | ||||||
4 | service segments when those segments are between 2 | ||||||
5 | customer channel termination points, 1 of which is | ||||||
6 | located in this State and the other is located | ||||||
7 | outside of this State, which segments are | ||||||
8 | separately charged. | ||||||
9 | (d) The receipts from charges for service | ||||||
10 | segments with a channel termination point located | ||||||
11 | in this State and in two or more other states, and | ||||||
12 | which segments are not separately billed, are in | ||||||
13 | this State based on a percentage determined by | ||||||
14 | dividing the number of customer channel | ||||||
15 | termination points in this State by the total | ||||||
16 | number of customer channel termination points. | ||||||
17 | (vi) Receipts from charges for ancillary services | ||||||
18 | for telecommunications service sold to customers at | ||||||
19 | retail are in this State if the customer's primary | ||||||
20 | place of use of telecommunications services associated | ||||||
21 | with those ancillary services is in this State. If the | ||||||
22 | seller of those ancillary services cannot determine | ||||||
23 | where the associated telecommunications are located, | ||||||
24 | then the ancillary services shall be based on the | ||||||
25 | location of the purchaser. | ||||||
26 | (vii) Receipts to access a carrier's network or |
| |||||||
| |||||||
1 | from the sale of telecommunication services or | ||||||
2 | ancillary services for resale are in this State as | ||||||
3 | follows: | ||||||
4 | (a) 100% of the receipts from access fees | ||||||
5 | attributable to intrastate telecommunications | ||||||
6 | service that both originates and terminates in | ||||||
7 | this State. | ||||||
8 | (b) 50% of the receipts from access fees | ||||||
9 | attributable to interstate telecommunications | ||||||
10 | service if the interstate call either originates | ||||||
11 | or terminates in this State. | ||||||
12 | (c) 100% of the receipts from interstate end | ||||||
13 | user access line charges, if the customer's | ||||||
14 | service address is in this State. As used in this | ||||||
15 | subdivision, "interstate end user access line | ||||||
16 | charges" includes, but is not limited to, the | ||||||
17 | surcharge approved by the federal communications | ||||||
18 | commission and levied pursuant to 47 CFR 69. | ||||||
19 | (d) Gross receipts from sales of | ||||||
20 | telecommunication services or from ancillary | ||||||
21 | services for telecommunications services sold to | ||||||
22 | other telecommunication service providers for | ||||||
23 | resale shall be sourced to this State using the | ||||||
24 | apportionment concepts used for non-resale | ||||||
25 | receipts of telecommunications services if the | ||||||
26 | information is readily available to make that |
| |||||||
| |||||||
1 | determination. If the information is not readily | ||||||
2 | available, then the taxpayer may use any other | ||||||
3 | reasonable and consistent method. | ||||||
4 | (B-7) For taxable years ending on or after December 31, | ||||||
5 | 2008, receipts from the sale of broadcasting services are | ||||||
6 | in this State if the broadcasting services are received in | ||||||
7 | this State. For purposes of this paragraph (B-7), the | ||||||
8 | following terms have the following meanings: | ||||||
9 | "Advertising revenue" means consideration received | ||||||
10 | by the taxpayer in exchange for broadcasting services | ||||||
11 | or allowing the broadcasting of commercials or | ||||||
12 | announcements in connection with the broadcasting of | ||||||
13 | film or radio programming, from sponsorships of the | ||||||
14 | programming, or from product placements in the | ||||||
15 | programming. | ||||||
16 | "Audience factor" means the ratio that the | ||||||
17 | audience or subscribers located in this State of a | ||||||
18 | station, a network, or a cable system bears to the | ||||||
19 | total audience or total subscribers for that station, | ||||||
20 | network, or cable system. The audience factor for film | ||||||
21 | or radio programming shall be determined by reference | ||||||
22 | to the books and records of the taxpayer or by | ||||||
23 | reference to published rating statistics provided the | ||||||
24 | method used by the taxpayer is consistently used from | ||||||
25 | year to year for this purpose and fairly represents the | ||||||
26 | taxpayer's activity in this State. |
| |||||||
| |||||||
1 | "Broadcast" or "broadcasting" or "broadcasting | ||||||
2 | services" means the transmission or provision of film | ||||||
3 | or radio programming, whether through the public | ||||||
4 | airwaves, by cable, by direct or indirect satellite | ||||||
5 | transmission, or by any other means of communication, | ||||||
6 | either through a station, a network, or a cable system. | ||||||
7 | "Film" or "film programming" means the broadcast | ||||||
8 | on television of any and all performances, events, or | ||||||
9 | productions, including but not limited to news, | ||||||
10 | sporting events, plays, stories, or other literary, | ||||||
11 | commercial, educational, or artistic works, either | ||||||
12 | live or through the use of video tape, disc, or any | ||||||
13 | other type of format or medium. Each episode of a | ||||||
14 | series of films produced for television shall | ||||||
15 | constitute separate "film" notwithstanding that the | ||||||
16 | series relates to the same principal subject and is | ||||||
17 | produced during one or more tax periods. | ||||||
18 | "Radio" or "radio programming" means the broadcast | ||||||
19 | on radio of any and all performances, events, or | ||||||
20 | productions, including but not limited to news, | ||||||
21 | sporting events, plays, stories, or other literary, | ||||||
22 | commercial, educational, or artistic works, either | ||||||
23 | live or through the use of an audio tape, disc, or any | ||||||
24 | other format or medium. Each episode in a series of | ||||||
25 | radio programming produced for radio broadcast shall | ||||||
26 | constitute a separate "radio programming" |
| |||||||
| |||||||
1 | notwithstanding that the series relates to the same | ||||||
2 | principal subject and is produced during one or more | ||||||
3 | tax periods. | ||||||
4 | (i) In the case of advertising revenue from | ||||||
5 | broadcasting, the customer is the advertiser and | ||||||
6 | the service is received in this State if the | ||||||
7 | commercial domicile of the advertiser is in this | ||||||
8 | State. | ||||||
9 | (ii) In the case where film or radio | ||||||
10 | programming is broadcast by a station, a network, | ||||||
11 | or a cable system for a fee or other remuneration | ||||||
12 | received from the recipient of the broadcast, the | ||||||
13 | portion of the service that is received in this | ||||||
14 | State is measured by the portion of the recipients | ||||||
15 | of the broadcast located in this State. | ||||||
16 | Accordingly, the fee or other remuneration for | ||||||
17 | such service that is included in the Illinois | ||||||
18 | numerator of the sales factor is the total of those | ||||||
19 | fees or other remuneration received from | ||||||
20 | recipients in Illinois. For purposes of this | ||||||
21 | paragraph, a taxpayer may determine the location | ||||||
22 | of the recipients of its broadcast using the | ||||||
23 | address of the recipient shown in its contracts | ||||||
24 | with the recipient or using the billing address of | ||||||
25 | the recipient in the taxpayer's records. | ||||||
26 | (iii) In the case where film or radio |
| |||||||
| |||||||
1 | programming is broadcast by a station, a network, | ||||||
2 | or a cable system for a fee or other remuneration | ||||||
3 | from the person providing the programming, the | ||||||
4 | portion of the broadcast service that is received | ||||||
5 | by such station, network, or cable system in this | ||||||
6 | State is measured by the portion of recipients of | ||||||
7 | the broadcast located in this State. Accordingly, | ||||||
8 | the amount of revenue related to such an | ||||||
9 | arrangement that is included in the Illinois | ||||||
10 | numerator of the sales factor is the total fee or | ||||||
11 | other total remuneration from the person providing | ||||||
12 | the programming related to that broadcast | ||||||
13 | multiplied by the Illinois audience factor for | ||||||
14 | that broadcast. | ||||||
15 | (iv) In the case where film or radio | ||||||
16 | programming is provided by a taxpayer that is a | ||||||
17 | network or station to a customer for broadcast in | ||||||
18 | exchange for a fee or other remuneration from that | ||||||
19 | customer the broadcasting service is received at | ||||||
20 | the location of the office of the customer from | ||||||
21 | which the services were ordered in the regular | ||||||
22 | course of the customer's trade or business. | ||||||
23 | Accordingly, in such a case the revenue derived by | ||||||
24 | the taxpayer that is included in the taxpayer's | ||||||
25 | Illinois numerator of the sales factor is the | ||||||
26 | revenue from such customers who receive the |
| |||||||
| |||||||
1 | broadcasting service in Illinois. | ||||||
2 | (v) In the case where film or radio programming | ||||||
3 | is provided by a taxpayer that is not a network or | ||||||
4 | station to another person for broadcasting in | ||||||
5 | exchange for a fee or other remuneration from that | ||||||
6 | person, the broadcasting service is received at | ||||||
7 | the location of the office of the customer from | ||||||
8 | which the services were ordered in the regular | ||||||
9 | course of the customer's trade or business. | ||||||
10 | Accordingly, in such a case the revenue derived by | ||||||
11 | the taxpayer that is included in the taxpayer's | ||||||
12 | Illinois numerator of the sales factor is the | ||||||
13 | revenue from such customers who receive the | ||||||
14 | broadcasting service in Illinois. | ||||||
15 | (B-8) Gross receipts from winnings under the Illinois | ||||||
16 | Lottery Law from the assignment of a prize under Section | ||||||
17 | 13.1 of the Illinois Lottery Law are received in this | ||||||
18 | State. This paragraph (B-8) applies only to taxable years | ||||||
19 | ending on or after December 31, 2013. | ||||||
20 | (B-9) Gross receipts from winnings from pari-mutuel | ||||||
21 | wagering conducted at a wagering facility licensed under | ||||||
22 | the Illinois Horse Racing Act of 1975 or from winnings from | ||||||
23 | gambling games conducted on a riverboat licensed under the | ||||||
24 | Riverboat Gambling Act are in this State. This paragraph | ||||||
25 | (B-9) applies only to taxable years ending on or after | ||||||
26 | December 31, 2019. |
| |||||||
| |||||||
1 | (C) For taxable years ending before December 31, 2008, | ||||||
2 | sales, other than sales governed by paragraphs (B), (B-1), | ||||||
3 | and (B-2), and (B-8) are in
this State if:
| ||||||
4 | (i) The income-producing activity is performed in | ||||||
5 | this State; or
| ||||||
6 | (ii) The income-producing activity is performed | ||||||
7 | both within and
without this State and a greater | ||||||
8 | proportion of the income-producing
activity is | ||||||
9 | performed within this State than without this State, | ||||||
10 | based
on performance costs.
| ||||||
11 | (C-5) For taxable years ending on or after December 31, | ||||||
12 | 2008, sales, other than sales governed by paragraphs (B), | ||||||
13 | (B-1), (B-2), (B-5), and (B-7), (B-8), and (B-9), are in | ||||||
14 | this State if any of the following criteria are met: | ||||||
15 | (i) Sales from the sale or lease of real property | ||||||
16 | are in this State if the property is located in this | ||||||
17 | State. | ||||||
18 | (ii) Sales from the lease or rental of tangible | ||||||
19 | personal property are in this State if the property is | ||||||
20 | located in this State during the rental period. Sales | ||||||
21 | from the lease or rental of tangible personal property | ||||||
22 | that is characteristically moving property, including, | ||||||
23 | but not limited to, motor vehicles, rolling stock, | ||||||
24 | aircraft, vessels, or mobile equipment are in this | ||||||
25 | State to the extent that the property is used in this | ||||||
26 | State. |
| |||||||
| |||||||
1 | (iii) In the case of interest, net gains (but not | ||||||
2 | less than zero) and other items of income from | ||||||
3 | intangible personal property, the sale is in this State | ||||||
4 | if: | ||||||
5 | (a) in the case of a taxpayer who is a dealer | ||||||
6 | in the item of intangible personal property within | ||||||
7 | the meaning of Section 475 of the Internal Revenue | ||||||
8 | Code, the income or gain is received from a | ||||||
9 | customer in this State. For purposes of this | ||||||
10 | subparagraph, a customer is in this State if the | ||||||
11 | customer is an individual, trust or estate who is a | ||||||
12 | resident of this State and, for all other | ||||||
13 | customers, if the customer's commercial domicile | ||||||
14 | is in this State. Unless the dealer has actual | ||||||
15 | knowledge of the residence or commercial domicile | ||||||
16 | of a customer during a taxable year, the customer | ||||||
17 | shall be deemed to be a customer in this State if | ||||||
18 | the billing address of the customer, as shown in | ||||||
19 | the records of the dealer, is in this State; or | ||||||
20 | (b) in all other cases, if the | ||||||
21 | income-producing activity of the taxpayer is | ||||||
22 | performed in this State or, if the | ||||||
23 | income-producing activity of the taxpayer is | ||||||
24 | performed both within and without this State, if a | ||||||
25 | greater proportion of the income-producing | ||||||
26 | activity of the taxpayer is performed within this |
| |||||||
| |||||||
1 | State than in any other state, based on performance | ||||||
2 | costs. | ||||||
3 | (iv) Sales of services are in this State if the | ||||||
4 | services are received in this State. For the purposes | ||||||
5 | of this section, gross receipts from the performance of | ||||||
6 | services provided to a corporation, partnership, or | ||||||
7 | trust may only be attributed to a state where that | ||||||
8 | corporation, partnership, or trust has a fixed place of | ||||||
9 | business. If the state where the services are received | ||||||
10 | is not readily determinable or is a state where the | ||||||
11 | corporation, partnership, or trust receiving the | ||||||
12 | service does not have a fixed place of business, the | ||||||
13 | services shall be deemed to be received at the location | ||||||
14 | of the office of the customer from which the services | ||||||
15 | were ordered in the regular course of the customer's | ||||||
16 | trade or business. If the ordering office cannot be | ||||||
17 | determined, the services shall be deemed to be received | ||||||
18 | at the office of the customer to which the services are | ||||||
19 | billed. If the taxpayer is not taxable in the state in | ||||||
20 | which the services are received, the sale must be | ||||||
21 | excluded from both the numerator and the denominator of | ||||||
22 | the sales factor. The Department shall adopt rules | ||||||
23 | prescribing where specific types of service are | ||||||
24 | received, including, but not limited to, publishing, | ||||||
25 | and utility service.
| ||||||
26 | (D) For taxable years ending on or after December 31, |
| |||||||
| |||||||
1 | 1995, the following
items of income shall not be included | ||||||
2 | in the numerator or denominator of the
sales factor: | ||||||
3 | dividends; amounts included under Section 78 of the | ||||||
4 | Internal
Revenue Code; and Subpart F income as defined in | ||||||
5 | Section 952 of the Internal
Revenue Code.
No inference | ||||||
6 | shall be drawn from the enactment of this paragraph (D) in
| ||||||
7 | construing this Section for taxable years ending before | ||||||
8 | December 31, 1995.
| ||||||
9 | (E) Paragraphs (B-1) and (B-2) shall apply to tax years | ||||||
10 | ending on or
after December 31, 1999, provided that a | ||||||
11 | taxpayer may elect to apply the
provisions of these | ||||||
12 | paragraphs to prior tax years. Such election shall be made
| ||||||
13 | in the form and manner prescribed by the Department, shall | ||||||
14 | be irrevocable, and
shall apply to all tax years; provided | ||||||
15 | that, if a taxpayer's Illinois income
tax liability for any | ||||||
16 | tax year, as assessed under Section 903 prior to January
1, | ||||||
17 | 1999, was computed in a manner contrary to the provisions | ||||||
18 | of paragraphs
(B-1) or (B-2), no refund shall be payable to | ||||||
19 | the taxpayer for that tax year to
the extent such refund is | ||||||
20 | the result of applying the provisions of paragraph
(B-1) or | ||||||
21 | (B-2) retroactively. In the case of a unitary business | ||||||
22 | group, such
election shall apply to all members of such | ||||||
23 | group for every tax year such group
is in existence, but | ||||||
24 | shall not apply to any taxpayer for any period during
which | ||||||
25 | that taxpayer is not a member of such group.
| ||||||
26 | (b) Insurance companies.
|
| |||||||
| |||||||
1 | (1) In general. Except as otherwise
provided by | ||||||
2 | paragraph (2), business income of an insurance company for | ||||||
3 | a
taxable year shall be apportioned to this State by | ||||||
4 | multiplying such
income by a fraction, the numerator of | ||||||
5 | which is the direct premiums
written for insurance upon | ||||||
6 | property or risk in this State, and the
denominator of | ||||||
7 | which is the direct premiums written for insurance upon
| ||||||
8 | property or risk everywhere. For purposes of this | ||||||
9 | subsection, the term
"direct premiums written" means the | ||||||
10 | total amount of direct premiums
written, assessments and | ||||||
11 | annuity considerations as reported for the
taxable year on | ||||||
12 | the annual statement filed by the company with the
Illinois | ||||||
13 | Director of Insurance in the form approved by the National
| ||||||
14 | Convention of Insurance Commissioners
or such other form as | ||||||
15 | may be
prescribed in lieu thereof.
| ||||||
16 | (2) Reinsurance. If the principal source of premiums | ||||||
17 | written by an
insurance company consists of premiums for | ||||||
18 | reinsurance accepted by it,
the business income of such | ||||||
19 | company shall be apportioned to this State
by multiplying | ||||||
20 | such income by a fraction, the numerator of which is the
| ||||||
21 | sum of (i) direct premiums written for insurance upon | ||||||
22 | property or risk
in this State, plus (ii) premiums written | ||||||
23 | for reinsurance accepted in
respect of property or risk in | ||||||
24 | this State, and the denominator of which
is the sum of | ||||||
25 | (iii) direct premiums written for insurance upon property
| ||||||
26 | or risk everywhere, plus (iv) premiums written for |
| |||||||
| |||||||
1 | reinsurance accepted
in respect of property or risk | ||||||
2 | everywhere. For purposes of this
paragraph, premiums | ||||||
3 | written for reinsurance accepted in respect of
property or | ||||||
4 | risk in this State, whether or not otherwise determinable,
| ||||||
5 | may, at the election of the company, be determined on the | ||||||
6 | basis of the
proportion which premiums written for | ||||||
7 | reinsurance accepted from
companies commercially domiciled | ||||||
8 | in Illinois bears to premiums written
for reinsurance | ||||||
9 | accepted from all sources, or, alternatively, in the
| ||||||
10 | proportion which the sum of the direct premiums written for | ||||||
11 | insurance
upon property or risk in this State by each | ||||||
12 | ceding company from which
reinsurance is accepted bears to | ||||||
13 | the sum of the total direct premiums
written by each such | ||||||
14 | ceding company for the taxable year. The election made by a | ||||||
15 | company under this paragraph for its first taxable year | ||||||
16 | ending on or after December 31, 2011, shall be binding for | ||||||
17 | that company for that taxable year and for all subsequent | ||||||
18 | taxable years, and may be altered only with the written | ||||||
19 | permission of the Department, which shall not be | ||||||
20 | unreasonably withheld.
| ||||||
21 | (c) Financial organizations.
| ||||||
22 | (1) In general. For taxable years ending before | ||||||
23 | December 31, 2008, business income of a financial
| ||||||
24 | organization shall be apportioned to this State by | ||||||
25 | multiplying such
income by a fraction, the numerator of | ||||||
26 | which is its business income from
sources within this |
| |||||||
| |||||||
1 | State, and the denominator of which is its business
income | ||||||
2 | from all sources. For the purposes of this subsection, the
| ||||||
3 | business income of a financial organization from sources | ||||||
4 | within this
State is the sum of the amounts referred to in | ||||||
5 | subparagraphs (A) through
(E) following, but excluding the | ||||||
6 | adjusted income of an international banking
facility as | ||||||
7 | determined in paragraph (2):
| ||||||
8 | (A) Fees, commissions or other compensation for | ||||||
9 | financial services
rendered within this State;
| ||||||
10 | (B) Gross profits from trading in stocks, bonds or | ||||||
11 | other securities
managed within this State;
| ||||||
12 | (C) Dividends, and interest from Illinois | ||||||
13 | customers, which are received
within this State;
| ||||||
14 | (D) Interest charged to customers at places of | ||||||
15 | business maintained
within this State for carrying | ||||||
16 | debit balances of margin accounts,
without deduction | ||||||
17 | of any costs incurred in carrying such accounts; and
| ||||||
18 | (E) Any other gross income resulting from the | ||||||
19 | operation as a
financial organization within this | ||||||
20 | State. In computing the amounts
referred to in | ||||||
21 | paragraphs (A) through (E) of this subsection, any | ||||||
22 | amount
received by a member of an affiliated group | ||||||
23 | (determined under Section
1504(a) of the Internal | ||||||
24 | Revenue Code but without reference to whether
any such | ||||||
25 | corporation is an "includible corporation" under | ||||||
26 | Section
1504(b) of the Internal Revenue Code) from |
| |||||||
| |||||||
1 | another member of such group
shall be included only to | ||||||
2 | the extent such amount exceeds expenses of the
| ||||||
3 | recipient directly related thereto.
| ||||||
4 | (2) International Banking Facility. For taxable years | ||||||
5 | ending before December 31, 2008:
| ||||||
6 | (A) Adjusted Income. The adjusted income of an | ||||||
7 | international banking
facility is its income reduced | ||||||
8 | by the amount of the floor amount.
| ||||||
9 | (B) Floor Amount. The floor amount shall be the | ||||||
10 | amount, if any,
determined
by multiplying the income of | ||||||
11 | the international banking facility by a fraction,
not | ||||||
12 | greater than one, which is determined as follows:
| ||||||
13 | (i) The numerator shall be:
| ||||||
14 | The average aggregate, determined on a | ||||||
15 | quarterly basis, of the
financial
organization's | ||||||
16 | loans to banks in foreign countries, to foreign | ||||||
17 | domiciled
borrowers (except where secured | ||||||
18 | primarily by real estate) and to foreign
| ||||||
19 | governments and other foreign official | ||||||
20 | institutions, as reported for its
branches, | ||||||
21 | agencies and offices within the state on its | ||||||
22 | "Consolidated Report
of Condition", Schedule A, | ||||||
23 | Lines 2.c., 5.b., and 7.a., which was filed with
| ||||||
24 | the Federal Deposit Insurance Corporation and | ||||||
25 | other regulatory authorities,
for the year 1980, | ||||||
26 | minus
|
| |||||||
| |||||||
1 | The average aggregate, determined on a | ||||||
2 | quarterly basis, of such loans
(other
than loans of | ||||||
3 | an international banking facility), as reported by | ||||||
4 | the financial
institution for its branches, | ||||||
5 | agencies and offices within the state, on
the | ||||||
6 | corresponding Schedule and lines of the | ||||||
7 | Consolidated Report of Condition
for the current | ||||||
8 | taxable year, provided, however, that in no case | ||||||
9 | shall the
amount determined in this clause (the | ||||||
10 | subtrahend) exceed the amount determined
in the | ||||||
11 | preceding clause (the minuend); and
| ||||||
12 | (ii) the denominator shall be the average | ||||||
13 | aggregate, determined on a
quarterly basis, of the | ||||||
14 | international banking facility's loans to banks in
| ||||||
15 | foreign countries, to foreign domiciled borrowers | ||||||
16 | (except where secured
primarily by real estate) | ||||||
17 | and to foreign governments and other foreign
| ||||||
18 | official institutions, which were recorded in its | ||||||
19 | financial accounts for
the current taxable year.
| ||||||
20 | (C) Change to Consolidated Report of Condition and | ||||||
21 | in Qualification.
In the event the Consolidated Report | ||||||
22 | of Condition which is filed with the
Federal Deposit | ||||||
23 | Insurance Corporation and other regulatory authorities | ||||||
24 | is
altered so that the information required for | ||||||
25 | determining the floor amount
is not found on Schedule | ||||||
26 | A, lines 2.c., 5.b. and 7.a., the financial
institution |
| |||||||
| |||||||
1 | shall notify the Department and the Department may, by
| ||||||
2 | regulations or otherwise, prescribe or authorize the | ||||||
3 | use of an alternative
source for such information. The | ||||||
4 | financial institution shall also notify
the Department | ||||||
5 | should its international banking facility fail to | ||||||
6 | qualify as
such, in whole or in part, or should there | ||||||
7 | be any amendment or change to
the Consolidated Report | ||||||
8 | of Condition, as originally filed, to the extent
such | ||||||
9 | amendment or change alters the information used in | ||||||
10 | determining the floor
amount.
| ||||||
11 | (3) For taxable years ending on or after December 31, | ||||||
12 | 2008, the business income of a financial organization shall | ||||||
13 | be apportioned to this State by multiplying such income by | ||||||
14 | a fraction, the numerator of which is its gross receipts | ||||||
15 | from sources in this State or otherwise attributable to | ||||||
16 | this State's marketplace and the denominator of which is | ||||||
17 | its gross receipts everywhere during the taxable year. | ||||||
18 | "Gross receipts" for purposes of this subparagraph (3) | ||||||
19 | means gross income, including net taxable gain on | ||||||
20 | disposition of assets, including securities and money | ||||||
21 | market instruments, when derived from transactions and | ||||||
22 | activities in the regular course of the financial | ||||||
23 | organization's trade or business. The following examples | ||||||
24 | are illustrative:
| ||||||
25 | (i) Receipts from the lease or rental of real or | ||||||
26 | tangible personal property are in this State if the |
| |||||||
| |||||||
1 | property is located in this State during the rental | ||||||
2 | period. Receipts from the lease or rental of tangible | ||||||
3 | personal property that is characteristically moving | ||||||
4 | property, including, but not limited to, motor | ||||||
5 | vehicles, rolling stock, aircraft, vessels, or mobile | ||||||
6 | equipment are from sources in this State to the extent | ||||||
7 | that the property is used in this State. | ||||||
8 | (ii) Interest income, commissions, fees, gains on | ||||||
9 | disposition, and other receipts from assets in the | ||||||
10 | nature of loans that are secured primarily by real | ||||||
11 | estate or tangible personal property are from sources | ||||||
12 | in this State if the security is located in this State. | ||||||
13 | (iii) Interest income, commissions, fees, gains on | ||||||
14 | disposition, and other receipts from consumer loans | ||||||
15 | that are not secured by real or tangible personal | ||||||
16 | property are from sources in this State if the debtor | ||||||
17 | is a resident of this State. | ||||||
18 | (iv) Interest income, commissions, fees, gains on | ||||||
19 | disposition, and other receipts from commercial loans | ||||||
20 | and installment obligations that are not secured by | ||||||
21 | real or tangible personal property are from sources in | ||||||
22 | this State if the proceeds of the loan are to be | ||||||
23 | applied in this State. If it cannot be determined where | ||||||
24 | the funds are to be applied, the income and receipts | ||||||
25 | are from sources in this State if the office of the | ||||||
26 | borrower from which the loan was negotiated in the |
| |||||||
| |||||||
1 | regular course of business is located in this State. If | ||||||
2 | the location of this office cannot be determined, the | ||||||
3 | income and receipts shall be excluded from the | ||||||
4 | numerator and denominator of the sales factor.
| ||||||
5 | (v) Interest income, fees, gains on disposition, | ||||||
6 | service charges, merchant discount income, and other | ||||||
7 | receipts from credit card receivables are from sources | ||||||
8 | in this State if the card charges are regularly billed | ||||||
9 | to a customer in this State. | ||||||
10 | (vi) Receipts from the performance of services, | ||||||
11 | including, but not limited to, fiduciary, advisory, | ||||||
12 | and brokerage services, are in this State if the | ||||||
13 | services are received in this State within the meaning | ||||||
14 | of subparagraph (a)(3)(C-5)(iv) of this Section. | ||||||
15 | (vii) Receipts from the issuance of travelers | ||||||
16 | checks and money orders are from sources in this State | ||||||
17 | if the checks and money orders are issued from a | ||||||
18 | location within this State. | ||||||
19 | (viii) Receipts from investment assets and | ||||||
20 | activities and trading assets and activities are | ||||||
21 | included in the receipts factor as follows: | ||||||
22 | (1) Interest, dividends, net gains (but not | ||||||
23 | less than zero) and other income from investment | ||||||
24 | assets and activities from trading assets and | ||||||
25 | activities shall be included in the receipts | ||||||
26 | factor. Investment assets and activities and |
| |||||||
| |||||||
1 | trading assets and activities include but are not | ||||||
2 | limited to: investment securities; trading account | ||||||
3 | assets; federal funds; securities purchased and | ||||||
4 | sold under agreements to resell or repurchase; | ||||||
5 | options; futures contracts; forward contracts; | ||||||
6 | notional principal contracts such as swaps; | ||||||
7 | equities; and foreign currency transactions. With | ||||||
8 | respect to the investment and trading assets and | ||||||
9 | activities described in subparagraphs (A) and (B) | ||||||
10 | of this paragraph, the receipts factor shall | ||||||
11 | include the amounts described in such | ||||||
12 | subparagraphs. | ||||||
13 | (A) The receipts factor shall include the | ||||||
14 | amount by which interest from federal funds | ||||||
15 | sold and securities purchased under resale | ||||||
16 | agreements exceeds interest expense on federal | ||||||
17 | funds purchased and securities sold under | ||||||
18 | repurchase agreements. | ||||||
19 | (B) The receipts factor shall include the | ||||||
20 | amount by which interest, dividends, gains and | ||||||
21 | other income from trading assets and | ||||||
22 | activities, including but not limited to | ||||||
23 | assets and activities in the matched book, in | ||||||
24 | the arbitrage book, and foreign currency | ||||||
25 | transactions, exceed amounts paid in lieu of | ||||||
26 | interest, amounts paid in lieu of dividends, |
| |||||||
| |||||||
1 | and losses from such assets and activities. | ||||||
2 | (2) The numerator of the receipts factor | ||||||
3 | includes interest, dividends, net gains (but not | ||||||
4 | less than zero), and other income from investment | ||||||
5 | assets and activities and from trading assets and | ||||||
6 | activities described in paragraph (1) of this | ||||||
7 | subsection that are attributable to this State. | ||||||
8 | (A) The amount of interest, dividends, net | ||||||
9 | gains (but not less than zero), and other | ||||||
10 | income from investment assets and activities | ||||||
11 | in the investment account to be attributed to | ||||||
12 | this State and included in the numerator is | ||||||
13 | determined by multiplying all such income from | ||||||
14 | such assets and activities by a fraction, the | ||||||
15 | numerator of which is the gross income from | ||||||
16 | such assets and activities which are properly | ||||||
17 | assigned to a fixed place of business of the | ||||||
18 | taxpayer within this State and the denominator | ||||||
19 | of which is the gross income from all such | ||||||
20 | assets and activities. | ||||||
21 | (B) The amount of interest from federal | ||||||
22 | funds sold and purchased and from securities | ||||||
23 | purchased under resale agreements and | ||||||
24 | securities sold under repurchase agreements | ||||||
25 | attributable to this State and included in the | ||||||
26 | numerator is determined by multiplying the |
| |||||||
| |||||||
1 | amount described in subparagraph (A) of | ||||||
2 | paragraph (1) of this subsection from such | ||||||
3 | funds and such securities by a fraction, the | ||||||
4 | numerator of which is the gross income from | ||||||
5 | such funds and such securities which are | ||||||
6 | properly assigned to a fixed place of business | ||||||
7 | of the taxpayer within this State and the | ||||||
8 | denominator of which is the gross income from | ||||||
9 | all such funds and such securities. | ||||||
10 | (C) The amount of interest, dividends, | ||||||
11 | gains, and other income from trading assets and | ||||||
12 | activities, including but not limited to | ||||||
13 | assets and activities in the matched book, in | ||||||
14 | the arbitrage book and foreign currency | ||||||
15 | transactions (but excluding amounts described | ||||||
16 | in subparagraphs (A) or (B) of this paragraph), | ||||||
17 | attributable to this State and included in the | ||||||
18 | numerator is determined by multiplying the | ||||||
19 | amount described in subparagraph (B) of | ||||||
20 | paragraph (1) of this subsection by a fraction, | ||||||
21 | the numerator of which is the gross income from | ||||||
22 | such trading assets and activities which are | ||||||
23 | properly assigned to a fixed place of business | ||||||
24 | of the taxpayer within this State and the | ||||||
25 | denominator of which is the gross income from | ||||||
26 | all such assets and activities. |
| |||||||
| |||||||
1 | (D) Properly assigned, for purposes of | ||||||
2 | this paragraph (2) of this subsection, means | ||||||
3 | the investment or trading asset or activity is | ||||||
4 | assigned to the fixed place of business with | ||||||
5 | which it has a preponderance of substantive | ||||||
6 | contacts. An investment or trading asset or | ||||||
7 | activity assigned by the taxpayer to a fixed | ||||||
8 | place of business without the State shall be | ||||||
9 | presumed to have been properly assigned if: | ||||||
10 | (i) the taxpayer has assigned, in the | ||||||
11 | regular course of its business, such asset | ||||||
12 | or activity on its records to a fixed place | ||||||
13 | of business consistent with federal or | ||||||
14 | state regulatory requirements; | ||||||
15 | (ii) such assignment on its records is | ||||||
16 | based upon substantive contacts of the | ||||||
17 | asset or activity to such fixed place of | ||||||
18 | business; and | ||||||
19 | (iii) the taxpayer uses such records | ||||||
20 | reflecting assignment of such assets or | ||||||
21 | activities for the filing of all state and | ||||||
22 | local tax returns for which an assignment | ||||||
23 | of such assets or activities to a fixed | ||||||
24 | place of business is required. | ||||||
25 | (E) The presumption of proper assignment | ||||||
26 | of an investment or trading asset or activity |
| |||||||
| |||||||
1 | provided in subparagraph (D) of paragraph (2) | ||||||
2 | of this subsection may be rebutted upon a | ||||||
3 | showing by the Department, supported by a | ||||||
4 | preponderance of the evidence, that the | ||||||
5 | preponderance of substantive contacts | ||||||
6 | regarding such asset or activity did not occur | ||||||
7 | at the fixed place of business to which it was | ||||||
8 | assigned on the taxpayer's records. If the | ||||||
9 | fixed place of business that has a | ||||||
10 | preponderance of substantive contacts cannot | ||||||
11 | be determined for an investment or trading | ||||||
12 | asset or activity to which the presumption in | ||||||
13 | subparagraph (D) of paragraph (2) of this | ||||||
14 | subsection does not apply or with respect to | ||||||
15 | which that presumption has been rebutted, that | ||||||
16 | asset or activity is properly assigned to the | ||||||
17 | state in which the taxpayer's commercial | ||||||
18 | domicile is located. For purposes of this | ||||||
19 | subparagraph (E), it shall be presumed, | ||||||
20 | subject to rebuttal, that taxpayer's | ||||||
21 | commercial domicile is in the state of the | ||||||
22 | United States or the District of Columbia to | ||||||
23 | which the greatest number of employees are | ||||||
24 | regularly connected with the management of the | ||||||
25 | investment or trading income or out of which | ||||||
26 | they are working, irrespective of where the |
| |||||||
| |||||||
1 | services of such employees are performed, as of | ||||||
2 | the last day of the taxable year.
| ||||||
3 | (4) (Blank). | ||||||
4 | (5) (Blank). | ||||||
5 | (c-1) Federally regulated exchanges. For taxable years | ||||||
6 | ending on or after December 31, 2012, business income of a | ||||||
7 | federally regulated exchange shall, at the option of the | ||||||
8 | federally regulated exchange, be apportioned to this State by | ||||||
9 | multiplying such income by a fraction, the numerator of which | ||||||
10 | is its business income from sources within this State, and the | ||||||
11 | denominator of which is its business income from all sources. | ||||||
12 | For purposes of this subsection, the business income within | ||||||
13 | this State of a federally regulated exchange is the sum of the | ||||||
14 | following: | ||||||
15 | (1) Receipts attributable to transactions executed on | ||||||
16 | a physical trading floor if that physical trading floor is | ||||||
17 | located in this State. | ||||||
18 | (2) Receipts attributable to all other matching, | ||||||
19 | execution, or clearing transactions, including without | ||||||
20 | limitation receipts from the provision of matching, | ||||||
21 | execution, or clearing services to another entity, | ||||||
22 | multiplied by (i) for taxable years ending on or after | ||||||
23 | December 31, 2012 but before December 31, 2013, 63.77%; and | ||||||
24 | (ii) for taxable years ending on or after December 31, | ||||||
25 | 2013, 27.54%. | ||||||
26 | (3) All other receipts not governed by subparagraphs |
| |||||||
| |||||||
1 | (1) or (2) of this subsection (c-1), to the extent the | ||||||
2 | receipts would be characterized as "sales in this State" | ||||||
3 | under item (3) of subsection (a) of this Section. | ||||||
4 | "Federally regulated exchange" means (i) a "registered | ||||||
5 | entity" within the meaning of 7 U.S.C. Section 1a(40)(A), (B), | ||||||
6 | or (C), (ii) an "exchange" or "clearing agency" within the | ||||||
7 | meaning of 15 U.S.C. Section 78c (a)(1) or (23), (iii) any such | ||||||
8 | entities regulated under any successor regulatory structure to | ||||||
9 | the foregoing, and (iv) all taxpayers who are members of the | ||||||
10 | same unitary business group as a federally regulated exchange, | ||||||
11 | determined without regard to the prohibition in Section | ||||||
12 | 1501(a)(27) of this Act against including in a unitary business | ||||||
13 | group taxpayers who are ordinarily required to apportion | ||||||
14 | business income under different subsections of this Section; | ||||||
15 | provided that this subparagraph (iv) shall apply only if 50% or | ||||||
16 | more of the business receipts of the unitary business group | ||||||
17 | determined by application of this subparagraph (iv) for the | ||||||
18 | taxable year are attributable to the matching, execution, or | ||||||
19 | clearing of transactions conducted by an entity described in | ||||||
20 | subparagraph (i), (ii), or (iii) of this paragraph. | ||||||
21 | In no event shall the Illinois apportionment percentage | ||||||
22 | computed in accordance with this subsection (c-1) for any | ||||||
23 | taxpayer for any tax year be less than the Illinois | ||||||
24 | apportionment percentage computed under this subsection (c-1) | ||||||
25 | for that taxpayer for the first full tax year ending on or | ||||||
26 | after December 31, 2013 for which this subsection (c-1) applied |
| |||||||
| |||||||
1 | to the taxpayer. | ||||||
2 | (d) Transportation services. For taxable years ending | ||||||
3 | before December 31, 2008, business income derived from | ||||||
4 | furnishing
transportation services shall be apportioned to | ||||||
5 | this State in accordance
with paragraphs (1) and (2):
| ||||||
6 | (1) Such business income (other than that derived from
| ||||||
7 | transportation by pipeline) shall be apportioned to this | ||||||
8 | State by
multiplying such income by a fraction, the | ||||||
9 | numerator of which is the
revenue miles of the person in | ||||||
10 | this State, and the denominator of which
is the revenue | ||||||
11 | miles of the person everywhere. For purposes of this
| ||||||
12 | paragraph, a revenue mile is the transportation of 1 | ||||||
13 | passenger or 1 net
ton of freight the distance of 1 mile | ||||||
14 | for a consideration. Where a
person is engaged in the | ||||||
15 | transportation of both passengers and freight,
the | ||||||
16 | fraction above referred to shall be determined by means of | ||||||
17 | an
average of the passenger revenue mile fraction and the | ||||||
18 | freight revenue
mile fraction, weighted to reflect the | ||||||
19 | person's
| ||||||
20 | (A) relative railway operating income from total | ||||||
21 | passenger and total
freight service, as reported to the | ||||||
22 | Interstate Commerce Commission, in
the case of | ||||||
23 | transportation by railroad, and
| ||||||
24 | (B) relative gross receipts from passenger and | ||||||
25 | freight
transportation, in case of transportation | ||||||
26 | other than by railroad.
|
| |||||||
| |||||||
1 | (2) Such business income derived from transportation | ||||||
2 | by pipeline
shall be apportioned to this State by | ||||||
3 | multiplying such income by a
fraction, the numerator of | ||||||
4 | which is the revenue miles of the person in
this State, and | ||||||
5 | the denominator of which is the revenue miles of the
person | ||||||
6 | everywhere. For the purposes of this paragraph, a revenue | ||||||
7 | mile is
the transportation by pipeline of 1 barrel of oil, | ||||||
8 | 1,000 cubic feet of
gas, or of any specified quantity of | ||||||
9 | any other substance, the distance
of 1 mile for a | ||||||
10 | consideration.
| ||||||
11 | (3) For taxable years ending on or after December 31, | ||||||
12 | 2008, business income derived from providing | ||||||
13 | transportation services other than airline services shall | ||||||
14 | be apportioned to this State by using a fraction, (a) the | ||||||
15 | numerator of which shall be (i) all receipts from any | ||||||
16 | movement or shipment of people, goods, mail, oil, gas, or | ||||||
17 | any other substance (other than by airline) that both | ||||||
18 | originates and terminates in this State, plus (ii) that | ||||||
19 | portion of the person's gross receipts from movements or | ||||||
20 | shipments of people, goods, mail, oil, gas, or any other | ||||||
21 | substance (other than by airline) that originates in one | ||||||
22 | state or jurisdiction and terminates in another state or | ||||||
23 | jurisdiction, that is determined by the ratio that the | ||||||
24 | miles traveled in this State bears to total miles | ||||||
25 | everywhere and (b) the denominator of which shall be all | ||||||
26 | revenue derived from the movement or shipment of people, |
| |||||||
| |||||||
1 | goods, mail, oil, gas, or any other substance (other than | ||||||
2 | by airline). Where a taxpayer is engaged in the | ||||||
3 | transportation of both passengers and freight, the | ||||||
4 | fraction above referred to shall first be determined | ||||||
5 | separately for passenger miles and freight miles. Then an | ||||||
6 | average of the passenger miles fraction and the freight | ||||||
7 | miles fraction shall be weighted to reflect the taxpayer's: | ||||||
8 | (A) relative railway operating income from total | ||||||
9 | passenger and total freight service, as reported to the | ||||||
10 | Surface Transportation Board, in the case of | ||||||
11 | transportation by railroad; and | ||||||
12 | (B) relative gross receipts from passenger and | ||||||
13 | freight transportation, in case of transportation | ||||||
14 | other than by railroad.
| ||||||
15 | (4) For taxable years ending on or after December 31, | ||||||
16 | 2008, business income derived from furnishing airline
| ||||||
17 | transportation services shall be apportioned to this State | ||||||
18 | by
multiplying such income by a fraction, the numerator of | ||||||
19 | which is the
revenue miles of the person in this State, and | ||||||
20 | the denominator of which
is the revenue miles of the person | ||||||
21 | everywhere. For purposes of this
paragraph, a revenue mile | ||||||
22 | is the transportation of one passenger or one net
ton of | ||||||
23 | freight the distance of one mile for a consideration. If a
| ||||||
24 | person is engaged in the transportation of both passengers | ||||||
25 | and freight,
the fraction above referred to shall be | ||||||
26 | determined by means of an
average of the passenger revenue |
| |||||||
| |||||||
1 | mile fraction and the freight revenue
mile fraction, | ||||||
2 | weighted to reflect the person's relative gross receipts | ||||||
3 | from passenger and freight
airline transportation.
| ||||||
4 | (e) Combined apportionment. Where 2 or more persons are | ||||||
5 | engaged in
a unitary business as described in subsection | ||||||
6 | (a)(27) of
Section 1501,
a part of which is conducted in this | ||||||
7 | State by one or more members of the
group, the business income | ||||||
8 | attributable to this State by any such member
or members shall | ||||||
9 | be apportioned by means of the combined apportionment method.
| ||||||
10 | (f) Alternative allocation. If the allocation and | ||||||
11 | apportionment
provisions of subsections (a) through (e) and of | ||||||
12 | subsection (h) do not, for taxable years ending before December | ||||||
13 | 31, 2008, fairly represent the
extent of a person's business | ||||||
14 | activity in this State, or, for taxable years ending on or | ||||||
15 | after December 31, 2008, fairly represent the market for the | ||||||
16 | person's goods, services, or other sources of business income, | ||||||
17 | the person may
petition for, or the Director may, without a | ||||||
18 | petition, permit or require, in respect of all or any part
of | ||||||
19 | the person's business activity, if reasonable:
| ||||||
20 | (1) Separate accounting;
| ||||||
21 | (2) The exclusion of any one or more factors;
| ||||||
22 | (3) The inclusion of one or more additional factors | ||||||
23 | which will
fairly represent the person's business | ||||||
24 | activities or market in this State; or
| ||||||
25 | (4) The employment of any other method to effectuate an | ||||||
26 | equitable
allocation and apportionment of the person's |
| |||||||
| |||||||
1 | business income.
| ||||||
2 | (g) Cross reference. For allocation of business income by | ||||||
3 | residents,
see Section 301(a).
| ||||||
4 | (h) For tax years ending on or after December 31, 1998, the | ||||||
5 | apportionment
factor of persons who apportion their business | ||||||
6 | income to this State under
subsection (a) shall be equal to:
| ||||||
7 | (1) for tax years ending on or after December 31, 1998 | ||||||
8 | and before December
31, 1999, 16 2/3% of the property | ||||||
9 | factor plus 16 2/3% of the payroll factor
plus
66 2/3% of | ||||||
10 | the sales factor;
| ||||||
11 | (2) for tax years ending on or after December 31, 1999 | ||||||
12 | and before December
31,
2000, 8 1/3% of the property factor | ||||||
13 | plus 8 1/3% of the payroll factor plus 83
1/3%
of the sales | ||||||
14 | factor;
| ||||||
15 | (3) for tax years ending on or after December 31, 2000, | ||||||
16 | the sales factor.
| ||||||
17 | If, in any tax year ending on or after December 31, 1998 and | ||||||
18 | before December
31, 2000, the denominator of the payroll, | ||||||
19 | property, or sales factor is zero,
the apportionment
factor | ||||||
20 | computed in paragraph (1) or (2) of this subsection for that | ||||||
21 | year shall
be divided by an amount equal to 100% minus the | ||||||
22 | percentage weight given to each
factor whose denominator is | ||||||
23 | equal to zero.
| ||||||
24 | (Source: P.A. 99-642, eff. 7-28-16; 100-201, eff. 8-18-17.)
| ||||||
25 | (35 ILCS 5/710) (from Ch. 120, par. 7-710)
|
| |||||||
| |||||||
1 | Sec. 710. Withholding from lottery , wagering and gambling | ||||||
2 | winnings. | ||||||
3 | (a) In general. | ||||||
4 | (1) Any person
making a payment to a resident or | ||||||
5 | nonresident of winnings under the Illinois
Lottery Law and | ||||||
6 | not required to withhold Illinois income tax from such | ||||||
7 | payment
under Subsection (b) of Section 701 of this Act | ||||||
8 | because those winnings are
not subject to Federal income | ||||||
9 | tax withholding, must withhold Illinois income
tax from | ||||||
10 | such payment at a rate equal to the percentage tax rate for | ||||||
11 | individuals
provided in subsection (b) of Section 201, | ||||||
12 | provided that withholding is
not required if such payment | ||||||
13 | of winnings is less than $1,000.
| ||||||
14 | (2) In the case of an assignment of a lottery prize | ||||||
15 | under Section 13.1 of the Illinois Lottery Law, any person | ||||||
16 | making a payment of the purchase price after December 31, | ||||||
17 | 2013, shall withhold from the amount of each payment at a | ||||||
18 | rate equal to the percentage tax rate for individuals | ||||||
19 | provided in subsection (b) of Section 201. | ||||||
20 | (3) Any person making a payment after December 31, | ||||||
21 | 2019, to a resident or nonresident of winnings from | ||||||
22 | pari-mutuel wagering conducted at a wagering facility | ||||||
23 | licensed under the Illinois Horse Racing Act of 1975 or | ||||||
24 | from gambling games conducted on a riverboat licensed under | ||||||
25 | the Riverboat Gambling Act must withhold Illinois income | ||||||
26 | tax from such payment at a rate equal to the percentage tax |
| |||||||
| |||||||
1 | rate for individuals provided in subsection (b) of Section | ||||||
2 | 201, provided that withholding on a payment is required | ||||||
3 | under this paragraph (3) only if withholding of tax on that | ||||||
4 | payment is required under the provisions of the Internal | ||||||
5 | Revenue Code. | ||||||
6 | (b) Credit for taxes withheld. Any amount withheld under | ||||||
7 | Subsection (a)
shall be a credit against the Illinois income | ||||||
8 | tax liability of the person
to whom the payment of winnings was | ||||||
9 | made for the taxable year in which that
person incurred an | ||||||
10 | Illinois income tax liability with respect to those winnings.
| ||||||
11 | (Source: P.A. 98-496, eff. 1-1-14.)
| ||||||
12 | Section 99. Effective date. This Act takes effect upon | ||||||
13 | becoming law.
|