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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5changing Sections 201, 208, 502, and 901 and by adding Sections
6201.1 and 229 as follows:
 
7    (35 ILCS 5/201)  (from Ch. 120, par. 2-201)
8    Sec. 201. Tax imposed.
9    (a) In general. A tax measured by net income is hereby
10imposed on every individual, corporation, trust and estate for
11each taxable year ending after July 31, 1969 on the privilege
12of earning or receiving income in or as a resident of this
13State. Such tax shall be in addition to all other occupation or
14privilege taxes imposed by this State or by any municipal
15corporation or political subdivision thereof.
16    (b) Rates. The tax imposed by subsection (a) of this
17Section shall be determined as follows, except as adjusted by
18subsection (d-1):
19        (1) In the case of an individual, trust or estate, for
20    taxable years ending prior to July 1, 1989, an amount equal
21    to 2 1/2% of the taxpayer's net income for the taxable
22    year.
23        (2) In the case of an individual, trust or estate, for

 

 

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1    taxable years beginning prior to July 1, 1989 and ending
2    after June 30, 1989, an amount equal to the sum of (i) 2
3    1/2% of the taxpayer's net income for the period prior to
4    July 1, 1989, as calculated under Section 202.3, and (ii)
5    3% of the taxpayer's net income for the period after June
6    30, 1989, as calculated under Section 202.3.
7        (3) In the case of an individual, trust or estate, for
8    taxable years beginning after June 30, 1989, and ending
9    prior to January 1, 2011, an amount equal to 3% of the
10    taxpayer's net income for the taxable year.
11        (4) In the case of an individual, trust, or estate, for
12    taxable years beginning prior to January 1, 2011, and
13    ending after December 31, 2010, an amount equal to the sum
14    of (i) 3% of the taxpayer's net income for the period prior
15    to January 1, 2011, as calculated under Section 202.5, and
16    (ii) 5% of the taxpayer's net income for the period after
17    December 31, 2010, as calculated under Section 202.5.
18        (5) In the case of an individual, trust, or estate, for
19    taxable years beginning on or after January 1, 2011, and
20    ending prior to January 1, 2015, an amount equal to 5% of
21    the taxpayer's net income for the taxable year.
22        (5.1) In the case of an individual, trust, or estate,
23    for taxable years beginning prior to January 1, 2015, and
24    ending after December 31, 2014, an amount equal to the sum
25    of (i) 5% of the taxpayer's net income for the period prior
26    to January 1, 2015, as calculated under Section 202.5, and

 

 

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1    (ii) 3.75% of the taxpayer's net income for the period
2    after December 31, 2014, as calculated under Section 202.5.
3        (5.2) In the case of an individual, trust, or estate,
4    for taxable years beginning on or after January 1, 2015,
5    and ending prior to July 1, 2017, an amount equal to 3.75%
6    of the taxpayer's net income for the taxable year.
7        (5.3) In the case of an individual, trust, or estate,
8    for taxable years beginning prior to July 1, 2017, and
9    ending after June 30, 2017, an amount equal to the sum of
10    (i) 3.75% of the taxpayer's net income for the period prior
11    to July 1, 2017, as calculated under Section 202.5, and
12    (ii) 4.95% of the taxpayer's net income for the period
13    after June 30, 2017, as calculated under Section 202.5.
14        (5.4) In the case of an individual, trust, or estate,
15    for taxable years beginning on or after July 1, 2017 and
16    beginning prior to January 1, 2021, an amount equal to
17    4.95% of the taxpayer's net income for the taxable year.
18        (5.5) In the case of an individual, trust, or estate,
19    for taxable years beginning on or after January 1, 2021, an
20    amount calculated under the rate structure set forth in
21    Section 201.1.
22        (6) In the case of a corporation, for taxable years
23    ending prior to July 1, 1989, an amount equal to 4% of the
24    taxpayer's net income for the taxable year.
25        (7) In the case of a corporation, for taxable years
26    beginning prior to July 1, 1989 and ending after June 30,

 

 

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1    1989, an amount equal to the sum of (i) 4% of the
2    taxpayer's net income for the period prior to July 1, 1989,
3    as calculated under Section 202.3, and (ii) 4.8% of the
4    taxpayer's net income for the period after June 30, 1989,
5    as calculated under Section 202.3.
6        (8) In the case of a corporation, for taxable years
7    beginning after June 30, 1989, and ending prior to January
8    1, 2011, an amount equal to 4.8% of the taxpayer's net
9    income for the taxable year.
10        (9) In the case of a corporation, for taxable years
11    beginning prior to January 1, 2011, and ending after
12    December 31, 2010, an amount equal to the sum of (i) 4.8%
13    of the taxpayer's net income for the period prior to
14    January 1, 2011, as calculated under Section 202.5, and
15    (ii) 7% of the taxpayer's net income for the period after
16    December 31, 2010, as calculated under Section 202.5.
17        (10) In the case of a corporation, for taxable years
18    beginning on or after January 1, 2011, and ending prior to
19    January 1, 2015, an amount equal to 7% of the taxpayer's
20    net income for the taxable year.
21        (11) In the case of a corporation, for taxable years
22    beginning prior to January 1, 2015, and ending after
23    December 31, 2014, an amount equal to the sum of (i) 7% of
24    the taxpayer's net income for the period prior to January
25    1, 2015, as calculated under Section 202.5, and (ii) 5.25%
26    of the taxpayer's net income for the period after December

 

 

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1    31, 2014, as calculated under Section 202.5.
2        (12) In the case of a corporation, for taxable years
3    beginning on or after January 1, 2015, and ending prior to
4    July 1, 2017, an amount equal to 5.25% of the taxpayer's
5    net income for the taxable year.
6        (13) In the case of a corporation, for taxable years
7    beginning prior to July 1, 2017, and ending after June 30,
8    2017, an amount equal to the sum of (i) 5.25% of the
9    taxpayer's net income for the period prior to July 1, 2017,
10    as calculated under Section 202.5, and (ii) 7% of the
11    taxpayer's net income for the period after June 30, 2017,
12    as calculated under Section 202.5.
13        (14) In the case of a corporation, for taxable years
14    beginning on or after July 1, 2017 and beginning prior to
15    January 1, 2021, an amount equal to 7% of the taxpayer's
16    net income for the taxable year.
17        (15) In the case of a corporation, for taxable years
18    beginning on or after January 1, 2021, an amount equal to
19    7.99% of the taxpayer's net income for the taxable year.
20    The rates under this subsection (b) are subject to the
21provisions of Section 201.5.
22    (c) Personal Property Tax Replacement Income Tax.
23Beginning on July 1, 1979 and thereafter, in addition to such
24income tax, there is also hereby imposed the Personal Property
25Tax Replacement Income Tax measured by net income on every
26corporation (including Subchapter S corporations), partnership

 

 

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1and trust, for each taxable year ending after June 30, 1979.
2Such taxes are imposed on the privilege of earning or receiving
3income in or as a resident of this State. The Personal Property
4Tax Replacement Income Tax shall be in addition to the income
5tax imposed by subsections (a) and (b) of this Section and in
6addition to all other occupation or privilege taxes imposed by
7this State or by any municipal corporation or political
8subdivision thereof.
9    (d) Additional Personal Property Tax Replacement Income
10Tax Rates. The personal property tax replacement income tax
11imposed by this subsection and subsection (c) of this Section
12in the case of a corporation, other than a Subchapter S
13corporation and except as adjusted by subsection (d-1), shall
14be an additional amount equal to 2.85% of such taxpayer's net
15income for the taxable year, except that beginning on January
161, 1981, and thereafter, the rate of 2.85% specified in this
17subsection shall be reduced to 2.5%, and in the case of a
18partnership, trust or a Subchapter S corporation shall be an
19additional amount equal to 1.5% of such taxpayer's net income
20for the taxable year.
21    (d-1) Rate reduction for certain foreign insurers. In the
22case of a foreign insurer, as defined by Section 35A-5 of the
23Illinois Insurance Code, whose state or country of domicile
24imposes on insurers domiciled in Illinois a retaliatory tax
25(excluding any insurer whose premiums from reinsurance assumed
26are 50% or more of its total insurance premiums as determined

 

 

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1under paragraph (2) of subsection (b) of Section 304, except
2that for purposes of this determination premiums from
3reinsurance do not include premiums from inter-affiliate
4reinsurance arrangements), beginning with taxable years ending
5on or after December 31, 1999, the sum of the rates of tax
6imposed by subsections (b) and (d) shall be reduced (but not
7increased) to the rate at which the total amount of tax imposed
8under this Act, net of all credits allowed under this Act,
9shall equal (i) the total amount of tax that would be imposed
10on the foreign insurer's net income allocable to Illinois for
11the taxable year by such foreign insurer's state or country of
12domicile if that net income were subject to all income taxes
13and taxes measured by net income imposed by such foreign
14insurer's state or country of domicile, net of all credits
15allowed or (ii) a rate of zero if no such tax is imposed on such
16income by the foreign insurer's state of domicile. For the
17purposes of this subsection (d-1), an inter-affiliate includes
18a mutual insurer under common management.
19        (1) For the purposes of subsection (d-1), in no event
20    shall the sum of the rates of tax imposed by subsections
21    (b) and (d) be reduced below the rate at which the sum of:
22            (A) the total amount of tax imposed on such foreign
23        insurer under this Act for a taxable year, net of all
24        credits allowed under this Act, plus
25            (B) the privilege tax imposed by Section 409 of the
26        Illinois Insurance Code, the fire insurance company

 

 

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1        tax imposed by Section 12 of the Fire Investigation
2        Act, and the fire department taxes imposed under
3        Section 11-10-1 of the Illinois Municipal Code,
4    equals 1.25% for taxable years ending prior to December 31,
5    2003, or 1.75% for taxable years ending on or after
6    December 31, 2003, of the net taxable premiums written for
7    the taxable year, as described by subsection (1) of Section
8    409 of the Illinois Insurance Code. This paragraph will in
9    no event increase the rates imposed under subsections (b)
10    and (d).
11        (2) Any reduction in the rates of tax imposed by this
12    subsection shall be applied first against the rates imposed
13    by subsection (b) and only after the tax imposed by
14    subsection (a) net of all credits allowed under this
15    Section other than the credit allowed under subsection (i)
16    has been reduced to zero, against the rates imposed by
17    subsection (d).
18    This subsection (d-1) is exempt from the provisions of
19Section 250.
20    (e) Investment credit. A taxpayer shall be allowed a credit
21against the Personal Property Tax Replacement Income Tax for
22investment in qualified property.
23        (1) A taxpayer shall be allowed a credit equal to .5%
24    of the basis of qualified property placed in service during
25    the taxable year, provided such property is placed in
26    service on or after July 1, 1984. There shall be allowed an

 

 

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1    additional credit equal to .5% of the basis of qualified
2    property placed in service during the taxable year,
3    provided such property is placed in service on or after
4    July 1, 1986, and the taxpayer's base employment within
5    Illinois has increased by 1% or more over the preceding
6    year as determined by the taxpayer's employment records
7    filed with the Illinois Department of Employment Security.
8    Taxpayers who are new to Illinois shall be deemed to have
9    met the 1% growth in base employment for the first year in
10    which they file employment records with the Illinois
11    Department of Employment Security. The provisions added to
12    this Section by Public Act 85-1200 (and restored by Public
13    Act 87-895) shall be construed as declaratory of existing
14    law and not as a new enactment. If, in any year, the
15    increase in base employment within Illinois over the
16    preceding year is less than 1%, the additional credit shall
17    be limited to that percentage times a fraction, the
18    numerator of which is .5% and the denominator of which is
19    1%, but shall not exceed .5%. The investment credit shall
20    not be allowed to the extent that it would reduce a
21    taxpayer's liability in any tax year below zero, nor may
22    any credit for qualified property be allowed for any year
23    other than the year in which the property was placed in
24    service in Illinois. For tax years ending on or after
25    December 31, 1987, and on or before December 31, 1988, the
26    credit shall be allowed for the tax year in which the

 

 

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1    property is placed in service, or, if the amount of the
2    credit exceeds the tax liability for that year, whether it
3    exceeds the original liability or the liability as later
4    amended, such excess may be carried forward and applied to
5    the tax liability of the 5 taxable years following the
6    excess credit years if the taxpayer (i) makes investments
7    which cause the creation of a minimum of 2,000 full-time
8    equivalent jobs in Illinois, (ii) is located in an
9    enterprise zone established pursuant to the Illinois
10    Enterprise Zone Act and (iii) is certified by the
11    Department of Commerce and Community Affairs (now
12    Department of Commerce and Economic Opportunity) as
13    complying with the requirements specified in clause (i) and
14    (ii) by July 1, 1986. The Department of Commerce and
15    Community Affairs (now Department of Commerce and Economic
16    Opportunity) shall notify the Department of Revenue of all
17    such certifications immediately. For tax years ending
18    after December 31, 1988, the credit shall be allowed for
19    the tax year in which the property is placed in service,
20    or, if the amount of the credit exceeds the tax liability
21    for that year, whether it exceeds the original liability or
22    the liability as later amended, such excess may be carried
23    forward and applied to the tax liability of the 5 taxable
24    years following the excess credit years. The credit shall
25    be applied to the earliest year for which there is a
26    liability. If there is credit from more than one tax year

 

 

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1    that is available to offset a liability, earlier credit
2    shall be applied first.
3        (2) The term "qualified property" means property
4    which:
5            (A) is tangible, whether new or used, including
6        buildings and structural components of buildings and
7        signs that are real property, but not including land or
8        improvements to real property that are not a structural
9        component of a building such as landscaping, sewer
10        lines, local access roads, fencing, parking lots, and
11        other appurtenances;
12            (B) is depreciable pursuant to Section 167 of the
13        Internal Revenue Code, except that "3-year property"
14        as defined in Section 168(c)(2)(A) of that Code is not
15        eligible for the credit provided by this subsection
16        (e);
17            (C) is acquired by purchase as defined in Section
18        179(d) of the Internal Revenue Code;
19            (D) is used in Illinois by a taxpayer who is
20        primarily engaged in manufacturing, or in mining coal
21        or fluorite, or in retailing, or was placed in service
22        on or after July 1, 2006 in a River Edge Redevelopment
23        Zone established pursuant to the River Edge
24        Redevelopment Zone Act; and
25            (E) has not previously been used in Illinois in
26        such a manner and by such a person as would qualify for

 

 

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1        the credit provided by this subsection (e) or
2        subsection (f).
3        (3) For purposes of this subsection (e),
4    "manufacturing" means the material staging and production
5    of tangible personal property by procedures commonly
6    regarded as manufacturing, processing, fabrication, or
7    assembling which changes some existing material into new
8    shapes, new qualities, or new combinations. For purposes of
9    this subsection (e) the term "mining" shall have the same
10    meaning as the term "mining" in Section 613(c) of the
11    Internal Revenue Code. For purposes of this subsection (e),
12    the term "retailing" means the sale of tangible personal
13    property for use or consumption and not for resale, or
14    services rendered in conjunction with the sale of tangible
15    personal property for use or consumption and not for
16    resale. For purposes of this subsection (e), "tangible
17    personal property" has the same meaning as when that term
18    is used in the Retailers' Occupation Tax Act, and, for
19    taxable years ending after December 31, 2008, does not
20    include the generation, transmission, or distribution of
21    electricity.
22        (4) The basis of qualified property shall be the basis
23    used to compute the depreciation deduction for federal
24    income tax purposes.
25        (5) If the basis of the property for federal income tax
26    depreciation purposes is increased after it has been placed

 

 

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1    in service in Illinois by the taxpayer, the amount of such
2    increase shall be deemed property placed in service on the
3    date of such increase in basis.
4        (6) The term "placed in service" shall have the same
5    meaning as under Section 46 of the Internal Revenue Code.
6        (7) If during any taxable year, any property ceases to
7    be qualified property in the hands of the taxpayer within
8    48 months after being placed in service, or the situs of
9    any qualified property is moved outside Illinois within 48
10    months after being placed in service, the Personal Property
11    Tax Replacement Income Tax for such taxable year shall be
12    increased. Such increase shall be determined by (i)
13    recomputing the investment credit which would have been
14    allowed for the year in which credit for such property was
15    originally allowed by eliminating such property from such
16    computation and, (ii) subtracting such recomputed credit
17    from the amount of credit previously allowed. For the
18    purposes of this paragraph (7), a reduction of the basis of
19    qualified property resulting from a redetermination of the
20    purchase price shall be deemed a disposition of qualified
21    property to the extent of such reduction.
22        (8) Unless the investment credit is extended by law,
23    the basis of qualified property shall not include costs
24    incurred after December 31, 2018, except for costs incurred
25    pursuant to a binding contract entered into on or before
26    December 31, 2018.

 

 

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1        (9) Each taxable year ending before December 31, 2000,
2    a partnership may elect to pass through to its partners the
3    credits to which the partnership is entitled under this
4    subsection (e) for the taxable year. A partner may use the
5    credit allocated to him or her under this paragraph only
6    against the tax imposed in subsections (c) and (d) of this
7    Section. If the partnership makes that election, those
8    credits shall be allocated among the partners in the
9    partnership in accordance with the rules set forth in
10    Section 704(b) of the Internal Revenue Code, and the rules
11    promulgated under that Section, and the allocated amount of
12    the credits shall be allowed to the partners for that
13    taxable year. The partnership shall make this election on
14    its Personal Property Tax Replacement Income Tax return for
15    that taxable year. The election to pass through the credits
16    shall be irrevocable.
17        For taxable years ending on or after December 31, 2000,
18    a partner that qualifies its partnership for a subtraction
19    under subparagraph (I) of paragraph (2) of subsection (d)
20    of Section 203 or a shareholder that qualifies a Subchapter
21    S corporation for a subtraction under subparagraph (S) of
22    paragraph (2) of subsection (b) of Section 203 shall be
23    allowed a credit under this subsection (e) equal to its
24    share of the credit earned under this subsection (e) during
25    the taxable year by the partnership or Subchapter S
26    corporation, determined in accordance with the

 

 

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1    determination of income and distributive share of income
2    under Sections 702 and 704 and Subchapter S of the Internal
3    Revenue Code. This paragraph is exempt from the provisions
4    of Section 250.
5    (f) Investment credit; Enterprise Zone; River Edge
6Redevelopment Zone.
7        (1) A taxpayer shall be allowed a credit against the
8    tax imposed by subsections (a) and (b) of this Section for
9    investment in qualified property which is placed in service
10    in an Enterprise Zone created pursuant to the Illinois
11    Enterprise Zone Act or, for property placed in service on
12    or after July 1, 2006, a River Edge Redevelopment Zone
13    established pursuant to the River Edge Redevelopment Zone
14    Act. For partners, shareholders of Subchapter S
15    corporations, and owners of limited liability companies,
16    if the liability company is treated as a partnership for
17    purposes of federal and State income taxation, there shall
18    be allowed a credit under this subsection (f) to be
19    determined in accordance with the determination of income
20    and distributive share of income under Sections 702 and 704
21    and Subchapter S of the Internal Revenue Code. The credit
22    shall be .5% of the basis for such property. The credit
23    shall be available only in the taxable year in which the
24    property is placed in service in the Enterprise Zone or
25    River Edge Redevelopment Zone and shall not be allowed to
26    the extent that it would reduce a taxpayer's liability for

 

 

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1    the tax imposed by subsections (a) and (b) of this Section
2    to below zero. For tax years ending on or after December
3    31, 1985, the credit shall be allowed for the tax year in
4    which the property is placed in service, or, if the amount
5    of the credit exceeds the tax liability for that year,
6    whether it exceeds the original liability or the liability
7    as later amended, such excess may be carried forward and
8    applied to the tax liability of the 5 taxable years
9    following the excess credit year. The credit shall be
10    applied to the earliest year for which there is a
11    liability. If there is credit from more than one tax year
12    that is available to offset a liability, the credit
13    accruing first in time shall be applied first.
14        (2) The term qualified property means property which:
15            (A) is tangible, whether new or used, including
16        buildings and structural components of buildings;
17            (B) is depreciable pursuant to Section 167 of the
18        Internal Revenue Code, except that "3-year property"
19        as defined in Section 168(c)(2)(A) of that Code is not
20        eligible for the credit provided by this subsection
21        (f);
22            (C) is acquired by purchase as defined in Section
23        179(d) of the Internal Revenue Code;
24            (D) is used in the Enterprise Zone or River Edge
25        Redevelopment Zone by the taxpayer; and
26            (E) has not been previously used in Illinois in

 

 

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1        such a manner and by such a person as would qualify for
2        the credit provided by this subsection (f) or
3        subsection (e).
4        (3) The basis of qualified property shall be the basis
5    used to compute the depreciation deduction for federal
6    income tax purposes.
7        (4) If the basis of the property for federal income tax
8    depreciation purposes is increased after it has been placed
9    in service in the Enterprise Zone or River Edge
10    Redevelopment Zone by the taxpayer, the amount of such
11    increase shall be deemed property placed in service on the
12    date of such increase in basis.
13        (5) The term "placed in service" shall have the same
14    meaning as under Section 46 of the Internal Revenue Code.
15        (6) If during any taxable year, any property ceases to
16    be qualified property in the hands of the taxpayer within
17    48 months after being placed in service, or the situs of
18    any qualified property is moved outside the Enterprise Zone
19    or River Edge Redevelopment Zone within 48 months after
20    being placed in service, the tax imposed under subsections
21    (a) and (b) of this Section for such taxable year shall be
22    increased. Such increase shall be determined by (i)
23    recomputing the investment credit which would have been
24    allowed for the year in which credit for such property was
25    originally allowed by eliminating such property from such
26    computation, and (ii) subtracting such recomputed credit

 

 

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1    from the amount of credit previously allowed. For the
2    purposes of this paragraph (6), a reduction of the basis of
3    qualified property resulting from a redetermination of the
4    purchase price shall be deemed a disposition of qualified
5    property to the extent of such reduction.
6        (7) There shall be allowed an additional credit equal
7    to 0.5% of the basis of qualified property placed in
8    service during the taxable year in a River Edge
9    Redevelopment Zone, provided such property is placed in
10    service on or after July 1, 2006, and the taxpayer's base
11    employment within Illinois has increased by 1% or more over
12    the preceding year as determined by the taxpayer's
13    employment records filed with the Illinois Department of
14    Employment Security. Taxpayers who are new to Illinois
15    shall be deemed to have met the 1% growth in base
16    employment for the first year in which they file employment
17    records with the Illinois Department of Employment
18    Security. If, in any year, the increase in base employment
19    within Illinois over the preceding year is less than 1%,
20    the additional credit shall be limited to that percentage
21    times a fraction, the numerator of which is 0.5% and the
22    denominator of which is 1%, but shall not exceed 0.5%.
23    (g) (Blank).
24    (h) Investment credit; High Impact Business.
25        (1) Subject to subsections (b) and (b-5) of Section 5.5
26    of the Illinois Enterprise Zone Act, a taxpayer shall be

 

 

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1    allowed a credit against the tax imposed by subsections (a)
2    and (b) of this Section for investment in qualified
3    property which is placed in service by a Department of
4    Commerce and Economic Opportunity designated High Impact
5    Business. The credit shall be .5% of the basis for such
6    property. The credit shall not be available (i) until the
7    minimum investments in qualified property set forth in
8    subdivision (a)(3)(A) of Section 5.5 of the Illinois
9    Enterprise Zone Act have been satisfied or (ii) until the
10    time authorized in subsection (b-5) of the Illinois
11    Enterprise Zone Act for entities designated as High Impact
12    Businesses under subdivisions (a)(3)(B), (a)(3)(C), and
13    (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone
14    Act, and shall not be allowed to the extent that it would
15    reduce a taxpayer's liability for the tax imposed by
16    subsections (a) and (b) of this Section to below zero. The
17    credit applicable to such investments shall be taken in the
18    taxable year in which such investments have been completed.
19    The credit for additional investments beyond the minimum
20    investment by a designated high impact business authorized
21    under subdivision (a)(3)(A) of Section 5.5 of the Illinois
22    Enterprise Zone Act shall be available only in the taxable
23    year in which the property is placed in service and shall
24    not be allowed to the extent that it would reduce a
25    taxpayer's liability for the tax imposed by subsections (a)
26    and (b) of this Section to below zero. For tax years ending

 

 

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1    on or after December 31, 1987, the credit shall be allowed
2    for the tax year in which the property is placed in
3    service, or, if the amount of the credit exceeds the tax
4    liability for that year, whether it exceeds the original
5    liability or the liability as later amended, such excess
6    may be carried forward and applied to the tax liability of
7    the 5 taxable years following the excess credit year. The
8    credit shall be applied to the earliest year for which
9    there is a liability. If there is credit from more than one
10    tax year that is available to offset a liability, the
11    credit accruing first in time shall be applied first.
12        Changes made in this subdivision (h)(1) by Public Act
13    88-670 restore changes made by Public Act 85-1182 and
14    reflect existing law.
15        (2) The term qualified property means property which:
16            (A) is tangible, whether new or used, including
17        buildings and structural components of buildings;
18            (B) is depreciable pursuant to Section 167 of the
19        Internal Revenue Code, except that "3-year property"
20        as defined in Section 168(c)(2)(A) of that Code is not
21        eligible for the credit provided by this subsection
22        (h);
23            (C) is acquired by purchase as defined in Section
24        179(d) of the Internal Revenue Code; and
25            (D) is not eligible for the Enterprise Zone
26        Investment Credit provided by subsection (f) of this

 

 

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1        Section.
2        (3) The basis of qualified property shall be the basis
3    used to compute the depreciation deduction for federal
4    income tax purposes.
5        (4) If the basis of the property for federal income tax
6    depreciation purposes is increased after it has been placed
7    in service in a federally designated Foreign Trade Zone or
8    Sub-Zone located in Illinois by the taxpayer, the amount of
9    such increase shall be deemed property placed in service on
10    the date of such increase in basis.
11        (5) The term "placed in service" shall have the same
12    meaning as under Section 46 of the Internal Revenue Code.
13        (6) If during any taxable year ending on or before
14    December 31, 1996, any property ceases to be qualified
15    property in the hands of the taxpayer within 48 months
16    after being placed in service, or the situs of any
17    qualified property is moved outside Illinois within 48
18    months after being placed in service, the tax imposed under
19    subsections (a) and (b) of this Section for such taxable
20    year shall be increased. Such increase shall be determined
21    by (i) recomputing the investment credit which would have
22    been allowed for the year in which credit for such property
23    was originally allowed by eliminating such property from
24    such computation, and (ii) subtracting such recomputed
25    credit from the amount of credit previously allowed. For
26    the purposes of this paragraph (6), a reduction of the

 

 

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1    basis of qualified property resulting from a
2    redetermination of the purchase price shall be deemed a
3    disposition of qualified property to the extent of such
4    reduction.
5        (7) Beginning with tax years ending after December 31,
6    1996, if a taxpayer qualifies for the credit under this
7    subsection (h) and thereby is granted a tax abatement and
8    the taxpayer relocates its entire facility in violation of
9    the explicit terms and length of the contract under Section
10    18-183 of the Property Tax Code, the tax imposed under
11    subsections (a) and (b) of this Section shall be increased
12    for the taxable year in which the taxpayer relocated its
13    facility by an amount equal to the amount of credit
14    received by the taxpayer under this subsection (h).
15    (i) Credit for Personal Property Tax Replacement Income
16Tax. For tax years ending prior to December 31, 2003, a credit
17shall be allowed against the tax imposed by subsections (a) and
18(b) of this Section for the tax imposed by subsections (c) and
19(d) of this Section. This credit shall be computed by
20multiplying the tax imposed by subsections (c) and (d) of this
21Section by a fraction, the numerator of which is base income
22allocable to Illinois and the denominator of which is Illinois
23base income, and further multiplying the product by the tax
24rate imposed by subsections (a) and (b) of this Section.
25    Any credit earned on or after December 31, 1986 under this
26subsection which is unused in the year the credit is computed

 

 

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1because it exceeds the tax liability imposed by subsections (a)
2and (b) for that year (whether it exceeds the original
3liability or the liability as later amended) may be carried
4forward and applied to the tax liability imposed by subsections
5(a) and (b) of the 5 taxable years following the excess credit
6year, provided that no credit may be carried forward to any
7year ending on or after December 31, 2003. This credit shall be
8applied first to the earliest year for which there is a
9liability. If there is a credit under this subsection from more
10than one tax year that is available to offset a liability the
11earliest credit arising under this subsection shall be applied
12first.
13    If, during any taxable year ending on or after December 31,
141986, the tax imposed by subsections (c) and (d) of this
15Section for which a taxpayer has claimed a credit under this
16subsection (i) is reduced, the amount of credit for such tax
17shall also be reduced. Such reduction shall be determined by
18recomputing the credit to take into account the reduced tax
19imposed by subsections (c) and (d). If any portion of the
20reduced amount of credit has been carried to a different
21taxable year, an amended return shall be filed for such taxable
22year to reduce the amount of credit claimed.
23    (j) Training expense credit. Beginning with tax years
24ending on or after December 31, 1986 and prior to December 31,
252003, a taxpayer shall be allowed a credit against the tax
26imposed by subsections (a) and (b) under this Section for all

 

 

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1amounts paid or accrued, on behalf of all persons employed by
2the taxpayer in Illinois or Illinois residents employed outside
3of Illinois by a taxpayer, for educational or vocational
4training in semi-technical or technical fields or semi-skilled
5or skilled fields, which were deducted from gross income in the
6computation of taxable income. The credit against the tax
7imposed by subsections (a) and (b) shall be 1.6% of such
8training expenses. For partners, shareholders of subchapter S
9corporations, and owners of limited liability companies, if the
10liability company is treated as a partnership for purposes of
11federal and State income taxation, there shall be allowed a
12credit under this subsection (j) to be determined in accordance
13with the determination of income and distributive share of
14income under Sections 702 and 704 and subchapter S of the
15Internal Revenue Code.
16    Any credit allowed under this subsection which is unused in
17the year the credit is earned may be carried forward to each of
18the 5 taxable years following the year for which the credit is
19first computed until it is used. This credit shall be applied
20first to the earliest year for which there is a liability. If
21there is a credit under this subsection from more than one tax
22year that is available to offset a liability the earliest
23credit arising under this subsection shall be applied first. No
24carryforward credit may be claimed in any tax year ending on or
25after December 31, 2003.
26    (k) Research and development credit. For tax years ending

 

 

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1after July 1, 1990 and prior to December 31, 2003, and
2beginning again for tax years ending on or after December 31,
32004, and ending prior to January 1, 2022, a taxpayer shall be
4allowed a credit against the tax imposed by subsections (a) and
5(b) of this Section for increasing research activities in this
6State. The credit allowed against the tax imposed by
7subsections (a) and (b) shall be equal to 6 1/2% of the
8qualifying expenditures for increasing research activities in
9this State. For partners, shareholders of subchapter S
10corporations, and owners of limited liability companies, if the
11liability company is treated as a partnership for purposes of
12federal and State income taxation, there shall be allowed a
13credit under this subsection to be determined in accordance
14with the determination of income and distributive share of
15income under Sections 702 and 704 and subchapter S of the
16Internal Revenue Code.
17    For purposes of this subsection, "qualifying expenditures"
18means the qualifying expenditures as defined for the federal
19credit for increasing research activities which would be
20allowable under Section 41 of the Internal Revenue Code and
21which are conducted in this State, "qualifying expenditures for
22increasing research activities in this State" means the excess
23of qualifying expenditures for the taxable year in which
24incurred over qualifying expenditures for the base period,
25"qualifying expenditures for the base period" means the average
26of the qualifying expenditures for each year in the base

 

 

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1period, and "base period" means the 3 taxable years immediately
2preceding the taxable year for which the determination is being
3made.
4    Any credit in excess of the tax liability for the taxable
5year may be carried forward. A taxpayer may elect to have the
6unused credit shown on its final completed return carried over
7as a credit against the tax liability for the following 5
8taxable years or until it has been fully used, whichever occurs
9first; provided that no credit earned in a tax year ending
10prior to December 31, 2003 may be carried forward to any year
11ending on or after December 31, 2003.
12    If an unused credit is carried forward to a given year from
132 or more earlier years, that credit arising in the earliest
14year will be applied first against the tax liability for the
15given year. If a tax liability for the given year still
16remains, the credit from the next earliest year will then be
17applied, and so on, until all credits have been used or no tax
18liability for the given year remains. Any remaining unused
19credit or credits then will be carried forward to the next
20following year in which a tax liability is incurred, except
21that no credit can be carried forward to a year which is more
22than 5 years after the year in which the expense for which the
23credit is given was incurred.
24    No inference shall be drawn from this amendatory Act of the
2591st General Assembly in construing this Section for taxable
26years beginning before January 1, 1999.

 

 

SB0687 Enrolled- 27 -LRB101 04448 HLH 49456 b

1    It is the intent of the General Assembly that the research
2and development credit under this subsection (k) shall apply
3continuously for all tax years ending on or after December 31,
42004 and ending prior to January 1, 2022, including, but not
5limited to, the period beginning on January 1, 2016 and ending
6on the effective date of this amendatory Act of the 100th
7General Assembly. All actions taken in reliance on the
8continuation of the credit under this subsection (k) by any
9taxpayer are hereby validated.
10    (l) Environmental Remediation Tax Credit.
11        (i) For tax years ending after December 31, 1997 and on
12    or before December 31, 2001, a taxpayer shall be allowed a
13    credit against the tax imposed by subsections (a) and (b)
14    of this Section for certain amounts paid for unreimbursed
15    eligible remediation costs, as specified in this
16    subsection. For purposes of this Section, "unreimbursed
17    eligible remediation costs" means costs approved by the
18    Illinois Environmental Protection Agency ("Agency") under
19    Section 58.14 of the Environmental Protection Act that were
20    paid in performing environmental remediation at a site for
21    which a No Further Remediation Letter was issued by the
22    Agency and recorded under Section 58.10 of the
23    Environmental Protection Act. The credit must be claimed
24    for the taxable year in which Agency approval of the
25    eligible remediation costs is granted. The credit is not
26    available to any taxpayer if the taxpayer or any related

 

 

SB0687 Enrolled- 28 -LRB101 04448 HLH 49456 b

1    party caused or contributed to, in any material respect, a
2    release of regulated substances on, in, or under the site
3    that was identified and addressed by the remedial action
4    pursuant to the Site Remediation Program of the
5    Environmental Protection Act. After the Pollution Control
6    Board rules are adopted pursuant to the Illinois
7    Administrative Procedure Act for the administration and
8    enforcement of Section 58.9 of the Environmental
9    Protection Act, determinations as to credit availability
10    for purposes of this Section shall be made consistent with
11    those rules. For purposes of this Section, "taxpayer"
12    includes a person whose tax attributes the taxpayer has
13    succeeded to under Section 381 of the Internal Revenue Code
14    and "related party" includes the persons disallowed a
15    deduction for losses by paragraphs (b), (c), and (f)(1) of
16    Section 267 of the Internal Revenue Code by virtue of being
17    a related taxpayer, as well as any of its partners. The
18    credit allowed against the tax imposed by subsections (a)
19    and (b) shall be equal to 25% of the unreimbursed eligible
20    remediation costs in excess of $100,000 per site, except
21    that the $100,000 threshold shall not apply to any site
22    contained in an enterprise zone as determined by the
23    Department of Commerce and Community Affairs (now
24    Department of Commerce and Economic Opportunity). The
25    total credit allowed shall not exceed $40,000 per year with
26    a maximum total of $150,000 per site. For partners and

 

 

SB0687 Enrolled- 29 -LRB101 04448 HLH 49456 b

1    shareholders of subchapter S corporations, there shall be
2    allowed a credit under this subsection to be determined in
3    accordance with the determination of income and
4    distributive share of income under Sections 702 and 704 and
5    subchapter S of the Internal Revenue Code.
6        (ii) A credit allowed under this subsection that is
7    unused in the year the credit is earned may be carried
8    forward to each of the 5 taxable years following the year
9    for which the credit is first earned until it is used. The
10    term "unused credit" does not include any amounts of
11    unreimbursed eligible remediation costs in excess of the
12    maximum credit per site authorized under paragraph (i).
13    This credit shall be applied first to the earliest year for
14    which there is a liability. If there is a credit under this
15    subsection from more than one tax year that is available to
16    offset a liability, the earliest credit arising under this
17    subsection shall be applied first. A credit allowed under
18    this subsection may be sold to a buyer as part of a sale of
19    all or part of the remediation site for which the credit
20    was granted. The purchaser of a remediation site and the
21    tax credit shall succeed to the unused credit and remaining
22    carry-forward period of the seller. To perfect the
23    transfer, the assignor shall record the transfer in the
24    chain of title for the site and provide written notice to
25    the Director of the Illinois Department of Revenue of the
26    assignor's intent to sell the remediation site and the

 

 

SB0687 Enrolled- 30 -LRB101 04448 HLH 49456 b

1    amount of the tax credit to be transferred as a portion of
2    the sale. In no event may a credit be transferred to any
3    taxpayer if the taxpayer or a related party would not be
4    eligible under the provisions of subsection (i).
5        (iii) For purposes of this Section, the term "site"
6    shall have the same meaning as under Section 58.2 of the
7    Environmental Protection Act.
8    (m) Education expense credit. Beginning with tax years
9ending after December 31, 1999, a taxpayer who is the custodian
10of one or more qualifying pupils shall be allowed a credit
11against the tax imposed by subsections (a) and (b) of this
12Section for qualified education expenses incurred on behalf of
13the qualifying pupils. The credit shall be equal to 25% of
14qualified education expenses, but in no event may the total
15credit under this subsection claimed by a family that is the
16custodian of qualifying pupils exceed (i) $500 for tax years
17ending prior to December 31, 2017, and (ii) $750 for tax years
18ending on or after December 31, 2017. In no event shall a
19credit under this subsection reduce the taxpayer's liability
20under this Act to less than zero. Notwithstanding any other
21provision of law, for taxable years beginning on or after
22January 1, 2017, no taxpayer may claim a credit under this
23subsection (m) if the taxpayer's adjusted gross income for the
24taxable year exceeds (i) $500,000, in the case of spouses
25filing a joint federal tax return or (ii) $250,000, in the case
26of all other taxpayers. This subsection is exempt from the

 

 

SB0687 Enrolled- 31 -LRB101 04448 HLH 49456 b

1provisions of Section 250 of this Act.
2    For purposes of this subsection:
3    "Qualifying pupils" means individuals who (i) are
4residents of the State of Illinois, (ii) are under the age of
521 at the close of the school year for which a credit is
6sought, and (iii) during the school year for which a credit is
7sought were full-time pupils enrolled in a kindergarten through
8twelfth grade education program at any school, as defined in
9this subsection.
10    "Qualified education expense" means the amount incurred on
11behalf of a qualifying pupil in excess of $250 for tuition,
12book fees, and lab fees at the school in which the pupil is
13enrolled during the regular school year.
14    "School" means any public or nonpublic elementary or
15secondary school in Illinois that is in compliance with Title
16VI of the Civil Rights Act of 1964 and attendance at which
17satisfies the requirements of Section 26-1 of the School Code,
18except that nothing shall be construed to require a child to
19attend any particular public or nonpublic school to qualify for
20the credit under this Section.
21    "Custodian" means, with respect to qualifying pupils, an
22Illinois resident who is a parent, the parents, a legal
23guardian, or the legal guardians of the qualifying pupils.
24    (n) River Edge Redevelopment Zone site remediation tax
25credit.
26        (i) For tax years ending on or after December 31, 2006,

 

 

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1    a taxpayer shall be allowed a credit against the tax
2    imposed by subsections (a) and (b) of this Section for
3    certain amounts paid for unreimbursed eligible remediation
4    costs, as specified in this subsection. For purposes of
5    this Section, "unreimbursed eligible remediation costs"
6    means costs approved by the Illinois Environmental
7    Protection Agency ("Agency") under Section 58.14a of the
8    Environmental Protection Act that were paid in performing
9    environmental remediation at a site within a River Edge
10    Redevelopment Zone for which a No Further Remediation
11    Letter was issued by the Agency and recorded under Section
12    58.10 of the Environmental Protection Act. The credit must
13    be claimed for the taxable year in which Agency approval of
14    the eligible remediation costs is granted. The credit is
15    not available to any taxpayer if the taxpayer or any
16    related party caused or contributed to, in any material
17    respect, a release of regulated substances on, in, or under
18    the site that was identified and addressed by the remedial
19    action pursuant to the Site Remediation Program of the
20    Environmental Protection Act. Determinations as to credit
21    availability for purposes of this Section shall be made
22    consistent with rules adopted by the Pollution Control
23    Board pursuant to the Illinois Administrative Procedure
24    Act for the administration and enforcement of Section 58.9
25    of the Environmental Protection Act. For purposes of this
26    Section, "taxpayer" includes a person whose tax attributes

 

 

SB0687 Enrolled- 33 -LRB101 04448 HLH 49456 b

1    the taxpayer has succeeded to under Section 381 of the
2    Internal Revenue Code and "related party" includes the
3    persons disallowed a deduction for losses by paragraphs
4    (b), (c), and (f)(1) of Section 267 of the Internal Revenue
5    Code by virtue of being a related taxpayer, as well as any
6    of its partners. The credit allowed against the tax imposed
7    by subsections (a) and (b) shall be equal to 25% of the
8    unreimbursed eligible remediation costs in excess of
9    $100,000 per site.
10        (ii) A credit allowed under this subsection that is
11    unused in the year the credit is earned may be carried
12    forward to each of the 5 taxable years following the year
13    for which the credit is first earned until it is used. This
14    credit shall be applied first to the earliest year for
15    which there is a liability. If there is a credit under this
16    subsection from more than one tax year that is available to
17    offset a liability, the earliest credit arising under this
18    subsection shall be applied first. A credit allowed under
19    this subsection may be sold to a buyer as part of a sale of
20    all or part of the remediation site for which the credit
21    was granted. The purchaser of a remediation site and the
22    tax credit shall succeed to the unused credit and remaining
23    carry-forward period of the seller. To perfect the
24    transfer, the assignor shall record the transfer in the
25    chain of title for the site and provide written notice to
26    the Director of the Illinois Department of Revenue of the

 

 

SB0687 Enrolled- 34 -LRB101 04448 HLH 49456 b

1    assignor's intent to sell the remediation site and the
2    amount of the tax credit to be transferred as a portion of
3    the sale. In no event may a credit be transferred to any
4    taxpayer if the taxpayer or a related party would not be
5    eligible under the provisions of subsection (i).
6        (iii) For purposes of this Section, the term "site"
7    shall have the same meaning as under Section 58.2 of the
8    Environmental Protection Act.
9    (o) For each of taxable years during the Compassionate Use
10of Medical Cannabis Pilot Program, a surcharge is imposed on
11all taxpayers on income arising from the sale or exchange of
12capital assets, depreciable business property, real property
13used in the trade or business, and Section 197 intangibles of
14an organization registrant under the Compassionate Use of
15Medical Cannabis Pilot Program Act. The amount of the surcharge
16is equal to the amount of federal income tax liability for the
17taxable year attributable to those sales and exchanges. The
18surcharge imposed does not apply if:
19        (1) the medical cannabis cultivation center
20    registration, medical cannabis dispensary registration, or
21    the property of a registration is transferred as a result
22    of any of the following:
23            (A) bankruptcy, a receivership, or a debt
24        adjustment initiated by or against the initial
25        registration or the substantial owners of the initial
26        registration;

 

 

SB0687 Enrolled- 35 -LRB101 04448 HLH 49456 b

1            (B) cancellation, revocation, or termination of
2        any registration by the Illinois Department of Public
3        Health;
4            (C) a determination by the Illinois Department of
5        Public Health that transfer of the registration is in
6        the best interests of Illinois qualifying patients as
7        defined by the Compassionate Use of Medical Cannabis
8        Pilot Program Act;
9            (D) the death of an owner of the equity interest in
10        a registrant;
11            (E) the acquisition of a controlling interest in
12        the stock or substantially all of the assets of a
13        publicly traded company;
14            (F) a transfer by a parent company to a wholly
15        owned subsidiary; or
16            (G) the transfer or sale to or by one person to
17        another person where both persons were initial owners
18        of the registration when the registration was issued;
19        or
20        (2) the cannabis cultivation center registration,
21    medical cannabis dispensary registration, or the
22    controlling interest in a registrant's property is
23    transferred in a transaction to lineal descendants in which
24    no gain or loss is recognized or as a result of a
25    transaction in accordance with Section 351 of the Internal
26    Revenue Code in which no gain or loss is recognized.

 

 

SB0687 Enrolled- 36 -LRB101 04448 HLH 49456 b

1(Source: P.A. 100-22, eff. 7-6-17.)
 
2    (35 ILCS 5/201.1 new)
3    Sec. 201.1. Tax rates. In the case of an individual, trust,
4or estate, for taxable years beginning on or after January 1,
52021, the amount of the tax imposed by subsection (a) of
6Section 201 of this Act shall be determined according to the
7following tax rate structure:
8        (1) for taxpayers who do not file a joint return and
9    have a net income of $750,000 or less:
10            (A) 4.75% of the portion of the taxpayer's net
11        income that does not exceed $10,000;
12            (B) 4.9% of the portion of the taxpayer's net
13        income that exceeds $10,000 but does not exceed
14        $100,000;
15            (C) 4.95% of the portion of the taxpayer's net
16        income that exceeds $100,000 but does not exceed
17        $250,000;
18            (D) 7.75% of the portion of the taxpayer's net
19        income that exceeds $250,000 but does not exceed
20        $350,000; and
21            (E) 7.85% of the portion of the taxpayer's net
22        income that exceeds $350,000 but does not exceed
23        $750,000; and
24        (2) for taxpayers who do not file a joint return and
25    have a net income that exceeds $750,000, 7.99% of the

 

 

SB0687 Enrolled- 37 -LRB101 04448 HLH 49456 b

1    taxpayer's net income;
2        (3) for taxpayers who file a joint return and have a
3    net income of $1,000,000 or less:
4            (A) 4.75% of the portion of the taxpayer's net
5        income that does not exceed $10,000;
6            (B) 4.9% of the portion of the taxpayer's net
7        income that exceeds $10,000 but does not exceed
8        $100,000;
9            (C) 4.95% of the portion of the taxpayer's net
10        income that exceeds $100,000 but does not exceed
11        $250,000;
12            (D) 7.75% of the portion of the taxpayer's net
13        income that exceeds $250,000 but does not exceed
14        $500,000; and
15            (E) 7.85% of the portion of the taxpayer's net
16        income that exceeds $500,000 but does not exceed
17        $1,000,000; and
18        (4) for taxpayers who file a joint return and have a
19    net income of more than $1,000,000, 7.99% of the taxpayer's
20    net income.
 
21    (35 ILCS 5/208)  (from Ch. 120, par. 2-208)
22    Sec. 208. Tax credit for residential real property taxes.
23For Beginning with tax years ending on or after December 31,
241991 and ending prior to December 31, 2021, every individual
25taxpayer shall be entitled to a tax credit equal to 5% of real

 

 

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1property taxes paid by such taxpayer during the taxable year on
2the principal residence of the taxpayer. For tax years ending
3on or after December 31, 2021, every individual taxpayer shall
4be entitled to a tax credit equal to 6% of real property taxes
5paid by such taxpayer during the taxable year on the principal
6residence of the taxpayer. In the case of multi-unit or
7multi-use structures and farm dwellings, the taxes on the
8taxpayer's principal residence shall be that portion of the
9total taxes which is attributable to such principal residence.
10Notwithstanding any other provision of law, for taxable years
11beginning on or after January 1, 2017, no taxpayer may claim a
12credit under this Section if the taxpayer's adjusted gross
13income for the taxable year exceeds (i) $500,000, in the case
14of spouses filing a joint federal tax return, or (ii) $250,000,
15in the case of all other taxpayers. This Section is exempt from
16the provisions of Section 250.
17(Source: P.A. 100-22, eff. 7-6-17.)
 
18    (35 ILCS 5/229 new)
19    Sec. 229. Child tax credit.
20    (a) For taxable years beginning on or after January 1,
212021, there shall be allowed as a credit against the tax
22imposed by Section 201 for the taxable year with respect to
23each child of the taxpayer who is under the age of 17 and for
24whom the taxpayer is allowed an additional exemption under
25Section 204 an amount equal to $100.

 

 

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1    (b) The amount of the credit allowed under subsection (a)
2shall be reduced by $5 for each $2,000 by which the taxpayer's
3net income exceeds $60,000 in the case of a joint return or
4exceeds $40,000 in the case of any other form of return.
5    (c) In no event shall a credit under this Section reduce
6the taxpayer's liability to less than zero.
7    (d) This Section is exempt from the provisions of Section
8250.
 
9    (35 ILCS 5/502)  (from Ch. 120, par. 5-502)
10    Sec. 502. Returns and notices.
11    (a) In general. A return with respect to the taxes imposed
12by this Act shall be made by every person for any taxable year:
13        (1) for which such person is liable for a tax imposed
14    by this Act, or
15        (2) in the case of a resident or in the case of a
16    corporation which is qualified to do business in this
17    State, for which such person is required to make a federal
18    income tax return, regardless of whether such person is
19    liable for a tax imposed by this Act. However, this
20    paragraph shall not require a resident to make a return if
21    such person has an Illinois base income of the basic amount
22    in Section 204(b) or less and is either claimed as a
23    dependent on another person's tax return under the Internal
24    Revenue Code, or is claimed as a dependent on another
25    person's tax return under this Act.

 

 

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1    Notwithstanding the provisions of paragraph (1), a
2nonresident (other than, for taxable years ending on or after
3December 31, 2011, a nonresident required to withhold tax under
4Section 709.5) whose Illinois income tax liability under
5subsections (a), (b), (c), and (d) of Section 201 of this Act
6is paid in full after taking into account the credits allowed
7under subsection (f) of this Section or allowed under Section
8709.5 of this Act shall not be required to file a return under
9this subsection (a).
10    (b) Fiduciaries and receivers.
11        (1) Decedents. If an individual is deceased, any return
12    or notice required of such individual under this Act shall
13    be made by his executor, administrator, or other person
14    charged with the property of such decedent.
15        (2) Individuals under a disability. If an individual is
16    unable to make a return or notice required under this Act,
17    the return or notice required of such individual shall be
18    made by his duly authorized agent, guardian, fiduciary or
19    other person charged with the care of the person or
20    property of such individual.
21        (3) Estates and trusts. Returns or notices required of
22    an estate or a trust shall be made by the fiduciary
23    thereof.
24        (4) Receivers, trustees and assignees for
25    corporations. In a case where a receiver, trustee in
26    bankruptcy, or assignee, by order of a court of competent

 

 

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1    jurisdiction, by operation of law, or otherwise, has
2    possession of or holds title to all or substantially all
3    the property or business of a corporation, whether or not
4    such property or business is being operated, such receiver,
5    trustee, or assignee shall make the returns and notices
6    required of such corporation in the same manner and form as
7    corporations are required to make such returns and notices.
8    (c) Joint returns by spouses husband and wife.
9        (1) Except as provided in paragraph (3):
10            (A) if spouses a husband and wife file a joint
11        federal income tax return for a taxable year ending
12        before December 31, 2009 or ending on or after December
13        31, 2021, they shall file a joint return under this Act
14        for such taxable year and their liabilities shall be
15        joint and several;
16            (B) if spouses a husband and wife file a joint
17        federal income tax return for a taxable year ending on
18        or after December 31, 2009 and ending prior to December
19        31, 2021, they may elect to file separate returns under
20        this Act for such taxable year. The election under this
21        paragraph must be made on or before the due date
22        (including extensions) of the return and, once made,
23        shall be irrevocable. If no election is timely made
24        under this paragraph for a taxable year:
25                (i) the couple must file a joint return under
26            this Act for such taxable year,

 

 

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1                (ii) their liabilities shall be joint and
2            several, and
3                (iii) any overpayment for that taxable year
4            may be withheld under Section 909 of this Act or
5            under Section 2505-275 of the Civil Administrative
6            Code of Illinois and applied against a debt of
7            either spouse without regard to the amount of the
8            overpayment attributable to the other spouse; and
9            (C) if the federal income tax liability of either
10        spouse is determined on a separate federal income tax
11        return, they shall file separate returns under this
12        Act.
13        (2) If neither spouse is required to file a federal
14    income tax return and either or both are required to file a
15    return under this Act, they may elect to file separate or
16    joint returns and pursuant to such election their
17    liabilities shall be separate or joint and several.
18        (3) If either spouse husband or wife is a resident and
19    the other is a nonresident, they shall file separate
20    returns in this State on such forms as may be required by
21    the Department in which event their tax liabilities shall
22    be separate; but if they file a joint federal income tax
23    return for a taxable year, they may elect to determine
24    their joint net income and file a joint return for that
25    taxable year under the provisions of paragraph (1) of this
26    subsection as if both were residents and in such case,

 

 

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1    their liabilities shall be joint and several.
2        (4) Innocent spouses.
3            (A) However, for tax liabilities arising and paid
4        prior to August 13, 1999, an innocent spouse shall be
5        relieved of liability for tax (including interest and
6        penalties) for any taxable year for which a joint
7        return has been made, upon submission of proof that the
8        Internal Revenue Service has made a determination
9        under Section 6013(e) of the Internal Revenue Code, for
10        the same taxable year, which determination relieved
11        the spouse from liability for federal income taxes. If
12        there is no federal income tax liability at issue for
13        the same taxable year, the Department shall rely on the
14        provisions of Section 6013(e) to determine whether the
15        person requesting innocent spouse abatement of tax,
16        penalty, and interest is entitled to that relief.
17            (B) For tax liabilities arising on and after August
18        13, 1999 or which arose prior to that date, but remain
19        unpaid as of that date, if an individual who filed a
20        joint return for any taxable year has made an election
21        under this paragraph, the individual's liability for
22        any tax shown on the joint return shall not exceed the
23        individual's separate return amount and the
24        individual's liability for any deficiency assessed for
25        that taxable year shall not exceed the portion of the
26        deficiency properly allocable to the individual. For

 

 

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1        purposes of this paragraph:
2                (i) An election properly made pursuant to
3            Section 6015 of the Internal Revenue Code shall
4            constitute an election under this paragraph,
5            provided that the election shall not be effective
6            until the individual has notified the Department
7            of the election in the form and manner prescribed
8            by the Department.
9                (ii) If no election has been made under Section
10            6015, the individual may make an election under
11            this paragraph in the form and manner prescribed by
12            the Department, provided that no election may be
13            made if the Department finds that assets were
14            transferred between individuals filing a joint
15            return as part of a scheme by such individuals to
16            avoid payment of Illinois income tax and the
17            election shall not eliminate the individual's
18            liability for any portion of a deficiency
19            attributable to an error on the return of which the
20            individual had actual knowledge as of the date of
21            filing.
22                (iii) In determining the separate return
23            amount or portion of any deficiency attributable
24            to an individual, the Department shall follow the
25            provisions in subsections (c) and (d) of Section
26            6015 of the Internal Revenue Code.

 

 

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1                (iv) In determining the validity of an
2            individual's election under subparagraph (ii) and
3            in determining an electing individual's separate
4            return amount or portion of any deficiency under
5            subparagraph (iii), any determination made by the
6            Secretary of the Treasury, by the United States Tax
7            Court on petition for review of a determination by
8            the Secretary of the Treasury, or on appeal from
9            the United States Tax Court under Section 6015 of
10            the Internal Revenue Code regarding criteria for
11            eligibility or under subsection (d) of Section
12            6015 of the Internal Revenue Code regarding the
13            allocation of any item of income, deduction,
14            payment, or credit between an individual making
15            the federal election and that individual's spouse
16            shall be conclusively presumed to be correct. With
17            respect to any item that is not the subject of a
18            determination by the Secretary of the Treasury or
19            the federal courts, in any proceeding involving
20            this subsection, the individual making the
21            election shall have the burden of proof with
22            respect to any item except that the Department
23            shall have the burden of proof with respect to
24            items in subdivision (ii).
25                (v) Any election made by an individual under
26            this subsection shall apply to all years for which

 

 

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1            that individual and the spouse named in the
2            election have filed a joint return.
3                (vi) After receiving a notice that the federal
4            election has been made or after receiving an
5            election under subdivision (ii), the Department
6            shall take no collection action against the
7            electing individual for any liability arising from
8            a joint return covered by the election until the
9            Department has notified the electing individual in
10            writing that the election is invalid or of the
11            portion of the liability the Department has
12            allocated to the electing individual. Within 60
13            days (150 days if the individual is outside the
14            United States) after the issuance of such
15            notification, the individual may file a written
16            protest of the denial of the election or of the
17            Department's determination of the liability
18            allocated to him or her and shall be granted a
19            hearing within the Department under the provisions
20            of Section 908. If a protest is filed, the
21            Department shall take no collection action against
22            the electing individual until the decision
23            regarding the protest has become final under
24            subsection (d) of Section 908 or, if
25            administrative review of the Department's decision
26            is requested under Section 1201, until the

 

 

SB0687 Enrolled- 47 -LRB101 04448 HLH 49456 b

1            decision of the court becomes final.
2    (d) Partnerships. Every partnership having any base income
3allocable to this State in accordance with section 305(c) shall
4retain information concerning all items of income, gain, loss
5and deduction; the names and addresses of all of the partners,
6or names and addresses of members of a limited liability
7company, or other persons who would be entitled to share in the
8base income of the partnership if distributed; the amount of
9the distributive share of each; and such other pertinent
10information as the Department may by forms or regulations
11prescribe. The partnership shall make that information
12available to the Department when requested by the Department.
13    (e) For taxable years ending on or after December 31, 1985,
14and before December 31, 1993, taxpayers that are corporations
15(other than Subchapter S corporations) having the same taxable
16year and that are members of the same unitary business group
17may elect to be treated as one taxpayer for purposes of any
18original return, amended return which includes the same
19taxpayers of the unitary group which joined in the election to
20file the original return, extension, claim for refund,
21assessment, collection and payment and determination of the
22group's tax liability under this Act. This subsection (e) does
23not permit the election to be made for some, but not all, of
24the purposes enumerated above. For taxable years ending on or
25after December 31, 1987, corporate members (other than
26Subchapter S corporations) of the same unitary business group

 

 

SB0687 Enrolled- 48 -LRB101 04448 HLH 49456 b

1making this subsection (e) election are not required to have
2the same taxable year.
3    For taxable years ending on or after December 31, 1993,
4taxpayers that are corporations (other than Subchapter S
5corporations) and that are members of the same unitary business
6group shall be treated as one taxpayer for purposes of any
7original return, amended return which includes the same
8taxpayers of the unitary group which joined in filing the
9original return, extension, claim for refund, assessment,
10collection and payment and determination of the group's tax
11liability under this Act.
12    (f) For taxable years ending prior to December 31, 2014,
13the Department may promulgate regulations to permit
14nonresident individual partners of the same partnership,
15nonresident Subchapter S corporation shareholders of the same
16Subchapter S corporation, and nonresident individuals
17transacting an insurance business in Illinois under a Lloyds
18plan of operation, and nonresident individual members of the
19same limited liability company that is treated as a partnership
20under Section 1501 (a)(16) of this Act, to file composite
21individual income tax returns reflecting the composite income
22of such individuals allocable to Illinois and to make composite
23individual income tax payments. For taxable years ending prior
24to December 31, 2014, the Department may by regulation also
25permit such composite returns to include the income tax owed by
26Illinois residents attributable to their income from

 

 

SB0687 Enrolled- 49 -LRB101 04448 HLH 49456 b

1partnerships, Subchapter S corporations, insurance businesses
2organized under a Lloyds plan of operation, or limited
3liability companies that are treated as partnership under
4Section 1501(a)(16) of this Act, in which case such Illinois
5residents will be permitted to claim credits on their
6individual returns for their shares of the composite tax
7payments. This paragraph of subsection (f) applies to taxable
8years ending on or after December 31, 1987 and ending prior to
9December 31, 2014.
10    For taxable years ending on or after December 31, 1999, the
11Department may, by regulation, permit any persons transacting
12an insurance business organized under a Lloyds plan of
13operation to file composite returns reflecting the income of
14such persons allocable to Illinois and the tax rates applicable
15to such persons under Section 201 and to make composite tax
16payments and shall, by regulation, also provide that the income
17and apportionment factors attributable to the transaction of an
18insurance business organized under a Lloyds plan of operation
19by any person joining in the filing of a composite return
20shall, for purposes of allocating and apportioning income under
21Article 3 of this Act and computing net income under Section
22202 of this Act, be excluded from any other income and
23apportionment factors of that person or of any unitary business
24group, as defined in subdivision (a)(27) of Section 1501, to
25which that person may belong.
26    For taxable years ending on or after December 31, 2008,

 

 

SB0687 Enrolled- 50 -LRB101 04448 HLH 49456 b

1every nonresident shall be allowed a credit against his or her
2liability under subsections (a) and (b) of Section 201 for any
3amount of tax reported on a composite return and paid on his or
4her behalf under this subsection (f). Residents (other than
5persons transacting an insurance business organized under a
6Lloyds plan of operation) may claim a credit for taxes reported
7on a composite return and paid on their behalf under this
8subsection (f) only as permitted by the Department by rule.
9    (f-5) For taxable years ending on or after December 31,
102008, the Department may adopt rules to provide that, when a
11partnership or Subchapter S corporation has made an error in
12determining the amount of any item of income, deduction,
13addition, subtraction, or credit required to be reported on its
14return that affects the liability imposed under this Act on a
15partner or shareholder, the partnership or Subchapter S
16corporation may report the changes in liabilities of its
17partners or shareholders and claim a refund of the resulting
18overpayments, or pay the resulting underpayments, on behalf of
19its partners and shareholders.
20    (g) The Department may adopt rules to authorize the
21electronic filing of any return required to be filed under this
22Section.
23(Source: P.A. 97-507, eff. 8-23-11; 98-478, eff. 1-1-14.)
 
24    (35 ILCS 5/901)  (from Ch. 120, par. 9-901)
25    Sec. 901. Collection authority.

 

 

SB0687 Enrolled- 51 -LRB101 04448 HLH 49456 b

1    (a) In general. The Department shall collect the taxes
2imposed by this Act. The Department shall collect certified
3past due child support amounts under Section 2505-650 of the
4Department of Revenue Law of the Civil Administrative Code of
5Illinois. Except as provided in subsections (b), (c), (e), (f),
6(g), and (h) of this Section, money collected pursuant to
7subsections (a) and (b) of Section 201 of this Act shall be
8paid into the General Revenue Fund in the State treasury; money
9collected pursuant to subsections (c) and (d) of Section 201 of
10this Act shall be paid into the Personal Property Tax
11Replacement Fund, a special fund in the State Treasury; and
12money collected under Section 2505-650 of the Department of
13Revenue Law of the Civil Administrative Code of Illinois shall
14be paid into the Child Support Enforcement Trust Fund, a
15special fund outside the State Treasury, or to the State
16Disbursement Unit established under Section 10-26 of the
17Illinois Public Aid Code, as directed by the Department of
18Healthcare and Family Services.
19    (b) Local Government Distributive Fund. Beginning August
201, 1969, and continuing through June 30, 1994, the Treasurer
21shall transfer each month from the General Revenue Fund to a
22special fund in the State treasury, to be known as the "Local
23Government Distributive Fund", an amount equal to 1/12 of the
24net revenue realized from the tax imposed by subsections (a)
25and (b) of Section 201 of this Act during the preceding month.
26Beginning July 1, 1994, and continuing through June 30, 1995,

 

 

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1the Treasurer shall transfer each month from the General
2Revenue Fund to the Local Government Distributive Fund an
3amount equal to 1/11 of the net revenue realized from the tax
4imposed by subsections (a) and (b) of Section 201 of this Act
5during the preceding month. Beginning July 1, 1995 and
6continuing through January 31, 2011, the Treasurer shall
7transfer each month from the General Revenue Fund to the Local
8Government Distributive Fund an amount equal to the net of (i)
91/10 of the net revenue realized from the tax imposed by
10subsections (a) and (b) of Section 201 of the Illinois Income
11Tax Act during the preceding month (ii) minus, beginning July
121, 2003 and ending June 30, 2004, $6,666,666, and beginning
13July 1, 2004, zero. Beginning February 1, 2011, and continuing
14through January 31, 2015, the Treasurer shall transfer each
15month from the General Revenue Fund to the Local Government
16Distributive Fund an amount equal to the sum of (i) 6% (10% of
17the ratio of the 3% individual income tax rate prior to 2011 to
18the 5% individual income tax rate after 2010) of the net
19revenue realized from the tax imposed by subsections (a) and
20(b) of Section 201 of this Act upon individuals, trusts, and
21estates during the preceding month and (ii) 6.86% (10% of the
22ratio of the 4.8% corporate income tax rate prior to 2011 to
23the 7% corporate income tax rate after 2010) of the net revenue
24realized from the tax imposed by subsections (a) and (b) of
25Section 201 of this Act upon corporations during the preceding
26month. Beginning February 1, 2015 and continuing through July

 

 

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131, 2017, the Treasurer shall transfer each month from the
2General Revenue Fund to the Local Government Distributive Fund
3an amount equal to the sum of (i) 8% (10% of the ratio of the 3%
4individual income tax rate prior to 2011 to the 3.75%
5individual income tax rate after 2014) of the net revenue
6realized from the tax imposed by subsections (a) and (b) of
7Section 201 of this Act upon individuals, trusts, and estates
8during the preceding month and (ii) 9.14% (10% of the ratio of
9the 4.8% corporate income tax rate prior to 2011 to the 5.25%
10corporate income tax rate after 2014) of the net revenue
11realized from the tax imposed by subsections (a) and (b) of
12Section 201 of this Act upon corporations during the preceding
13month. Beginning August 1, 2017 and continuing through January
1431, 2021, the Treasurer shall transfer each month from the
15General Revenue Fund to the Local Government Distributive Fund
16an amount equal to the sum of (i) 6.06% (10% of the ratio of the
173% individual income tax rate prior to 2011 to the 4.95%
18individual income tax rate after July 1, 2017) of the net
19revenue realized from the tax imposed by subsections (a) and
20(b) of Section 201 of this Act upon individuals, trusts, and
21estates during the preceding month and (ii) 6.85% (10% of the
22ratio of the 4.8% corporate income tax rate prior to 2011 to
23the 7% corporate income tax rate after July 1, 2017) of the net
24revenue realized from the tax imposed by subsections (a) and
25(b) of Section 201 of this Act upon corporations during the
26preceding month. Beginning February 1, 2021, the Treasurer

 

 

SB0687 Enrolled- 54 -LRB101 04448 HLH 49456 b

1shall transfer each month from the General Revenue Fund to the
2Local Government Distributive Fund an amount equal to the sum
3of (i) 5.32% of the net revenue realized from the tax imposed
4by subsections (a) and (b) of Section 201 of this Act upon
5individuals, trusts, and estates during the preceding month and
6(ii) 6.16% of the net revenue realized from the tax imposed by
7subsections (a) and (b) of Section 201 of this Act upon
8corporations during the preceding month. Net revenue realized
9for a month shall be defined as the revenue from the tax
10imposed by subsections (a) and (b) of Section 201 of this Act
11which is deposited in the General Revenue Fund, the Education
12Assistance Fund, the Income Tax Surcharge Local Government
13Distributive Fund, the Fund for the Advancement of Education,
14and the Commitment to Human Services Fund during the month
15minus the amount paid out of the General Revenue Fund in State
16warrants during that same month as refunds to taxpayers for
17overpayment of liability under the tax imposed by subsections
18(a) and (b) of Section 201 of this Act.
19    Notwithstanding any provision of law to the contrary,
20beginning on July 6, 2017 (the effective date of Public Act
21100-23), those amounts required under this subsection (b) to be
22transferred by the Treasurer into the Local Government
23Distributive Fund from the General Revenue Fund shall be
24directly deposited into the Local Government Distributive Fund
25as the revenue is realized from the tax imposed by subsections
26(a) and (b) of Section 201 of this Act.

 

 

SB0687 Enrolled- 55 -LRB101 04448 HLH 49456 b

1    For State fiscal year 2018 only, notwithstanding any
2provision of law to the contrary, the total amount of revenue
3and deposits under this Section attributable to revenues
4realized during State fiscal year 2018 shall be reduced by 10%.
5    For State fiscal year 2019 only, notwithstanding any
6provision of law to the contrary, the total amount of revenue
7and deposits under this Section attributable to revenues
8realized during State fiscal year 2019 shall be reduced by 5%.
9    (c) Deposits Into Income Tax Refund Fund.
10        (1) Beginning on January 1, 1989 and thereafter, the
11    Department shall deposit a percentage of the amounts
12    collected pursuant to subsections (a) and (b)(1), (2), and
13    (3) of Section 201 of this Act into a fund in the State
14    treasury known as the Income Tax Refund Fund. The
15    Department shall deposit 6% of such amounts during the
16    period beginning January 1, 1989 and ending on June 30,
17    1989. Beginning with State fiscal year 1990 and for each
18    fiscal year thereafter, the percentage deposited into the
19    Income Tax Refund Fund during a fiscal year shall be the
20    Annual Percentage. For fiscal years 1999 through 2001, the
21    Annual Percentage shall be 7.1%. For fiscal year 2003, the
22    Annual Percentage shall be 8%. For fiscal year 2004, the
23    Annual Percentage shall be 11.7%. Upon the effective date
24    of Public Act 93-839 (July 30, 2004), the Annual Percentage
25    shall be 10% for fiscal year 2005. For fiscal year 2006,
26    the Annual Percentage shall be 9.75%. For fiscal year 2007,

 

 

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1    the Annual Percentage shall be 9.75%. For fiscal year 2008,
2    the Annual Percentage shall be 7.75%. For fiscal year 2009,
3    the Annual Percentage shall be 9.75%. For fiscal year 2010,
4    the Annual Percentage shall be 9.75%. For fiscal year 2011,
5    the Annual Percentage shall be 8.75%. For fiscal year 2012,
6    the Annual Percentage shall be 8.75%. For fiscal year 2013,
7    the Annual Percentage shall be 9.75%. For fiscal year 2014,
8    the Annual Percentage shall be 9.5%. For fiscal year 2015,
9    the Annual Percentage shall be 10%. For fiscal year 2018,
10    the Annual Percentage shall be 9.8%. For fiscal year 2019,
11    the Annual Percentage shall be 9.7%. For all other fiscal
12    years, the Annual Percentage shall be calculated as a
13    fraction, the numerator of which shall be the amount of
14    refunds approved for payment by the Department during the
15    preceding fiscal year as a result of overpayment of tax
16    liability under subsections (a) and (b)(1), (2), and (3) of
17    Section 201 of this Act plus the amount of such refunds
18    remaining approved but unpaid at the end of the preceding
19    fiscal year, minus the amounts transferred into the Income
20    Tax Refund Fund from the Tobacco Settlement Recovery Fund,
21    and the denominator of which shall be the amounts which
22    will be collected pursuant to subsections (a) and (b)(1),
23    (2), and (3) of Section 201 of this Act during the
24    preceding fiscal year; except that in State fiscal year
25    2002, the Annual Percentage shall in no event exceed 7.6%.
26    The Director of Revenue shall certify the Annual Percentage

 

 

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1    to the Comptroller on the last business day of the fiscal
2    year immediately preceding the fiscal year for which it is
3    to be effective.
4        (2) Beginning on January 1, 1989 and thereafter, the
5    Department shall deposit a percentage of the amounts
6    collected pursuant to subsections (a) and (b)(6), (7), and
7    (8), (c) and (d) of Section 201 of this Act into a fund in
8    the State treasury known as the Income Tax Refund Fund. The
9    Department shall deposit 18% of such amounts during the
10    period beginning January 1, 1989 and ending on June 30,
11    1989. Beginning with State fiscal year 1990 and for each
12    fiscal year thereafter, the percentage deposited into the
13    Income Tax Refund Fund during a fiscal year shall be the
14    Annual Percentage. For fiscal years 1999, 2000, and 2001,
15    the Annual Percentage shall be 19%. For fiscal year 2003,
16    the Annual Percentage shall be 27%. For fiscal year 2004,
17    the Annual Percentage shall be 32%. Upon the effective date
18    of Public Act 93-839 (July 30, 2004), the Annual Percentage
19    shall be 24% for fiscal year 2005. For fiscal year 2006,
20    the Annual Percentage shall be 20%. For fiscal year 2007,
21    the Annual Percentage shall be 17.5%. For fiscal year 2008,
22    the Annual Percentage shall be 15.5%. For fiscal year 2009,
23    the Annual Percentage shall be 17.5%. For fiscal year 2010,
24    the Annual Percentage shall be 17.5%. For fiscal year 2011,
25    the Annual Percentage shall be 17.5%. For fiscal year 2012,
26    the Annual Percentage shall be 17.5%. For fiscal year 2013,

 

 

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1    the Annual Percentage shall be 14%. For fiscal year 2014,
2    the Annual Percentage shall be 13.4%. For fiscal year 2015,
3    the Annual Percentage shall be 14%. For fiscal year 2018,
4    the Annual Percentage shall be 17.5%. For fiscal year 2019,
5    the Annual Percentage shall be 15.5%. For all other fiscal
6    years, the Annual Percentage shall be calculated as a
7    fraction, the numerator of which shall be the amount of
8    refunds approved for payment by the Department during the
9    preceding fiscal year as a result of overpayment of tax
10    liability under subsections (a) and (b)(6), (7), and (8),
11    (c) and (d) of Section 201 of this Act plus the amount of
12    such refunds remaining approved but unpaid at the end of
13    the preceding fiscal year, and the denominator of which
14    shall be the amounts which will be collected pursuant to
15    subsections (a) and (b)(6), (7), and (8), (c) and (d) of
16    Section 201 of this Act during the preceding fiscal year;
17    except that in State fiscal year 2002, the Annual
18    Percentage shall in no event exceed 23%. The Director of
19    Revenue shall certify the Annual Percentage to the
20    Comptroller on the last business day of the fiscal year
21    immediately preceding the fiscal year for which it is to be
22    effective.
23        (3) The Comptroller shall order transferred and the
24    Treasurer shall transfer from the Tobacco Settlement
25    Recovery Fund to the Income Tax Refund Fund (i) $35,000,000
26    in January, 2001, (ii) $35,000,000 in January, 2002, and

 

 

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1    (iii) $35,000,000 in January, 2003.
2    (d) Expenditures from Income Tax Refund Fund.
3        (1) Beginning January 1, 1989, money in the Income Tax
4    Refund Fund shall be expended exclusively for the purpose
5    of paying refunds resulting from overpayment of tax
6    liability under Section 201 of this Act and for making
7    transfers pursuant to this subsection (d).
8        (2) The Director shall order payment of refunds
9    resulting from overpayment of tax liability under Section
10    201 of this Act from the Income Tax Refund Fund only to the
11    extent that amounts collected pursuant to Section 201 of
12    this Act and transfers pursuant to this subsection (d) and
13    item (3) of subsection (c) have been deposited and retained
14    in the Fund.
15        (3) As soon as possible after the end of each fiscal
16    year, the Director shall order transferred and the State
17    Treasurer and State Comptroller shall transfer from the
18    Income Tax Refund Fund to the Personal Property Tax
19    Replacement Fund an amount, certified by the Director to
20    the Comptroller, equal to the excess of the amount
21    collected pursuant to subsections (c) and (d) of Section
22    201 of this Act deposited into the Income Tax Refund Fund
23    during the fiscal year over the amount of refunds resulting
24    from overpayment of tax liability under subsections (c) and
25    (d) of Section 201 of this Act paid from the Income Tax
26    Refund Fund during the fiscal year.

 

 

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1        (4) As soon as possible after the end of each fiscal
2    year, the Director shall order transferred and the State
3    Treasurer and State Comptroller shall transfer from the
4    Personal Property Tax Replacement Fund to the Income Tax
5    Refund Fund an amount, certified by the Director to the
6    Comptroller, equal to the excess of the amount of refunds
7    resulting from overpayment of tax liability under
8    subsections (c) and (d) of Section 201 of this Act paid
9    from the Income Tax Refund Fund during the fiscal year over
10    the amount collected pursuant to subsections (c) and (d) of
11    Section 201 of this Act deposited into the Income Tax
12    Refund Fund during the fiscal year.
13        (4.5) As soon as possible after the end of fiscal year
14    1999 and of each fiscal year thereafter, the Director shall
15    order transferred and the State Treasurer and State
16    Comptroller shall transfer from the Income Tax Refund Fund
17    to the General Revenue Fund any surplus remaining in the
18    Income Tax Refund Fund as of the end of such fiscal year;
19    excluding for fiscal years 2000, 2001, and 2002 amounts
20    attributable to transfers under item (3) of subsection (c)
21    less refunds resulting from the earned income tax credit.
22        (5) This Act shall constitute an irrevocable and
23    continuing appropriation from the Income Tax Refund Fund
24    for the purpose of paying refunds upon the order of the
25    Director in accordance with the provisions of this Section.
26    (e) Deposits into the Education Assistance Fund and the

 

 

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1Income Tax Surcharge Local Government Distributive Fund. On
2July 1, 1991, and thereafter, of the amounts collected pursuant
3to subsections (a) and (b) of Section 201 of this Act, minus
4deposits into the Income Tax Refund Fund, the Department shall
5deposit 7.3% into the Education Assistance Fund in the State
6Treasury. Beginning July 1, 1991, and continuing through
7January 31, 1993, of the amounts collected pursuant to
8subsections (a) and (b) of Section 201 of the Illinois Income
9Tax Act, minus deposits into the Income Tax Refund Fund, the
10Department shall deposit 3.0% into the Income Tax Surcharge
11Local Government Distributive Fund in the State Treasury.
12Beginning February 1, 1993 and continuing through June 30,
131993, of the amounts collected pursuant to subsections (a) and
14(b) of Section 201 of the Illinois Income Tax Act, minus
15deposits into the Income Tax Refund Fund, the Department shall
16deposit 4.4% into the Income Tax Surcharge Local Government
17Distributive Fund in the State Treasury. Beginning July 1,
181993, and continuing through June 30, 1994, of the amounts
19collected under subsections (a) and (b) of Section 201 of this
20Act, minus deposits into the Income Tax Refund Fund, the
21Department shall deposit 1.475% into the Income Tax Surcharge
22Local Government Distributive Fund in the State Treasury.
23    (f) Deposits into the Fund for the Advancement of
24Education. Beginning February 1, 2015, the Department shall
25deposit the following portions of the revenue realized from the
26tax imposed upon individuals, trusts, and estates by

 

 

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1subsections (a) and (b) of Section 201 of this Act, minus
2deposits into the Income Tax Refund Fund, into the Fund for the
3Advancement of Education:
4        (1) beginning February 1, 2015, and prior to February
5    1, 2025, 1/30; and
6        (2) beginning February 1, 2025, 1/26.
7    If the rate of tax imposed by subsection (a) and (b) of
8Section 201 is reduced pursuant to Section 201.5 of this Act,
9the Department shall not make the deposits required by this
10subsection (f) on or after the effective date of the reduction.
11    (g) Deposits into the Commitment to Human Services Fund.
12Beginning February 1, 2015, the Department shall deposit the
13following portions of the revenue realized from the tax imposed
14upon individuals, trusts, and estates by subsections (a) and
15(b) of Section 201 of this Act, minus deposits into the Income
16Tax Refund Fund, into the Commitment to Human Services Fund:
17        (1) beginning February 1, 2015, and prior to February
18    1, 2025, 1/30; and
19        (2) beginning February 1, 2025, 1/26.
20    If the rate of tax imposed by subsection (a) and (b) of
21Section 201 is reduced pursuant to Section 201.5 of this Act,
22the Department shall not make the deposits required by this
23subsection (g) on or after the effective date of the reduction.
24    (h) Deposits into the Tax Compliance and Administration
25Fund. Beginning on the first day of the first calendar month to
26occur on or after August 26, 2014 (the effective date of Public

 

 

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1Act 98-1098), each month the Department shall pay into the Tax
2Compliance and Administration Fund, to be used, subject to
3appropriation, to fund additional auditors and compliance
4personnel at the Department, an amount equal to 1/12 of 5% of
5the cash receipts collected during the preceding fiscal year by
6the Audit Bureau of the Department from the tax imposed by
7subsections (a), (b), (c), and (d) of Section 201 of this Act,
8net of deposits into the Income Tax Refund Fund made from those
9cash receipts.
10(Source: P.A. 99-78, eff. 7-20-15; 100-22, eff. 7-6-17; 100-23,
11eff. 7-6-17; 100-587, eff. 6-4-18; 100-621, eff. 7-20-18;
12100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; revised 1-8-19.)
 
13    Section 99. Effective date. This Act takes effect on
14January 1, 2021, but does not take effect at all unless Senate
15Joint Resolution Constitutional Amendment No. 1 of the 101st
16General Assembly is approved by the voters of the State prior
17to that date.