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1 | | AN ACT concerning revenue.
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2 | | Be it enacted by the People of the State of Illinois,
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3 | | represented in the General Assembly:
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4 | | Section 5. The Illinois Income Tax Act is amended by |
5 | | changing Section 221 as follows: |
6 | | (35 ILCS 5/221) |
7 | | Sec. 221. Rehabilitation costs; qualified historic |
8 | | properties; River Edge Redevelopment Zone. |
9 | | (a) For taxable years that begin on or after January 1, |
10 | | 2012 and begin prior to January 1, 2018, there shall be allowed |
11 | | a tax credit against the tax imposed by subsections (a) and (b) |
12 | | of Section 201 of this Act in an amount equal to 25% of |
13 | | qualified expenditures incurred by a qualified taxpayer during |
14 | | the taxable year in the restoration and preservation of a |
15 | | qualified historic structure located in a River Edge |
16 | | Redevelopment Zone pursuant to a qualified rehabilitation |
17 | | plan, provided that the total amount of such expenditures (i) |
18 | | must equal $5,000 or more and (ii) must exceed 50% of the |
19 | | purchase price of the property. |
20 | | (a-1) For taxable years that begin on or after January 1, |
21 | | 2018 and end prior to January 1, 2027 January 1, 2022 , there |
22 | | shall be allowed a tax credit against the tax imposed by |
23 | | subsections (a) and (b) of Section 201 of this Act in an |
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1 | | aggregate amount equal to 25% of qualified expenditures |
2 | | incurred by a qualified taxpayer in the restoration and |
3 | | preservation of a qualified historic structure located in a |
4 | | River Edge Redevelopment Zone pursuant to a qualified |
5 | | rehabilitation plan, provided that the total amount of such |
6 | | expenditures must : (i) equal $5,000 or more ; and (ii) exceed |
7 | | the adjusted basis of the qualified historic structure on the |
8 | | first day the qualified rehabilitation plan begins ; and (iii) |
9 | | be a part of a qualified rehabilitation plan or phase of a |
10 | | qualified rehabilitation plan that received final approval to |
11 | | begin the expenditures no later than December 31, 2026 . For |
12 | | any rehabilitation project, regardless of duration or number |
13 | | of phases, the project's compliance with the foregoing |
14 | | provisions (i) and (ii) shall be determined based on the |
15 | | aggregate amount of qualified expenditures for the entire |
16 | | project and may include expenditures incurred under subsection |
17 | | (a), this subsection, or both subsection (a) and this |
18 | | subsection. If the qualified rehabilitation plan spans |
19 | | multiple years, the aggregate credit for the entire project |
20 | | shall be allowed in the last taxable year, except for phased |
21 | | rehabilitation projects, which may receive credits upon |
22 | | completion of each phase. Before obtaining the first phased |
23 | | credit: (A) the total amount of such expenditures must meet |
24 | | the requirements of provisions (i) and (ii) of this |
25 | | subsection; (B) the rehabilitated portion of the qualified |
26 | | historic structure must be placed in service; and (C) the |
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1 | | requirements of subsection (b) must be met. |
2 | | (a-2) For taxable years beginning on or after January 1, |
3 | | 2021 and ending prior to January 1, 2022, there shall be |
4 | | allowed a tax credit against the tax imposed by subsections |
5 | | (a) and (b) of Section 201 as provided in Section 10-10.3 of |
6 | | the River Edge Redevelopment Zone Act. The credit allowed |
7 | | under this subsection (a-2) shall apply only to taxpayers that |
8 | | make a capital investment of at least $1,000,000 in a |
9 | | qualified rehabilitation plan. |
10 | | The credit or credits may not reduce the taxpayer's |
11 | | liability to less than zero. If the amount of the credit or |
12 | | credits exceeds the taxpayer's liability, the excess may be |
13 | | carried forward and applied against the taxpayer's liability |
14 | | in succeeding calendar years in the manner provided under |
15 | | paragraph (4) of Section 211 of this Act. The credit or credits |
16 | | shall be applied to the earliest year for which there is a tax |
17 | | liability. If there are credits from more than one taxable |
18 | | year that are available to offset a liability, the earlier |
19 | | credit shall be applied first. |
20 | | For partners, shareholders of Subchapter S corporations, |
21 | | and owners of limited liability companies, if the liability |
22 | | company is treated as a partnership for the purposes of |
23 | | federal and State income taxation, there shall be allowed a |
24 | | credit under this Section to be determined in accordance with |
25 | | the determination of income and distributive share of income |
26 | | under Sections 702 and 704 and Subchapter S of the Internal |
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1 | | Revenue Code. |
2 | | The total aggregate amount of credits awarded under the |
3 | | Blue Collar Jobs Act (Article 20 of this amendatory Act of the |
4 | | 101st General Assembly) shall not exceed $20,000,000 in any |
5 | | State fiscal year. |
6 | | (b) To obtain a tax credit pursuant to this Section, the |
7 | | taxpayer must apply with the Department of Natural Resources. |
8 | | The Department of Natural Resources shall determine the amount |
9 | | of eligible rehabilitation costs and expenses in addition to |
10 | | the amount of the River Edge construction jobs credit within |
11 | | 45 days of receipt of a complete application. The taxpayer |
12 | | must submit a certification of costs prepared by an |
13 | | independent certified public accountant that certifies (i) the |
14 | | project expenses, (ii) whether those expenses are qualified |
15 | | expenditures, and (iii) that the qualified expenditures exceed |
16 | | the adjusted basis of the qualified historic structure on the |
17 | | first day the qualified rehabilitation plan commenced. The |
18 | | Department of Natural Resources is authorized, but not |
19 | | required, to accept this certification of costs to determine |
20 | | the amount of qualified expenditures and the amount of the |
21 | | credit. The Department of Natural Resources shall provide |
22 | | guidance as to the minimum standards to be followed in the |
23 | | preparation of such certification. The Department of Natural |
24 | | Resources and the National Park Service shall determine |
25 | | whether the rehabilitation is consistent with the United |
26 | | States Secretary of the Interior's Standards for |
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1 | | Rehabilitation. |
2 | | (b-1) Upon completion of the project and approval of the |
3 | | complete application, the Department of Natural Resources |
4 | | shall issue a single certificate in the amount of the eligible |
5 | | credits equal to 25% of qualified expenditures incurred during |
6 | | the eligible taxable years, as defined in subsections (a) and |
7 | | (a-1), excepting any credits awarded under subsection (a) |
8 | | prior to January 1, 2019 (the effective date of Public Act |
9 | | 100-629) and any phased credits issued prior to the eligible |
10 | | taxable year under subsection (a-1). At the time the |
11 | | certificate is issued, an issuance fee up to the maximum |
12 | | amount of 2% of the amount of the credits issued by the |
13 | | certificate may be collected from the applicant to administer |
14 | | the provisions of this Section. If collected, this issuance |
15 | | fee shall be deposited into the Historic Property |
16 | | Administrative Fund, a special fund created in the State |
17 | | treasury. Subject to appropriation, moneys in the Historic |
18 | | Property Administrative Fund shall be provided to the |
19 | | Department of Natural Resources as reimbursement for the costs |
20 | | associated with administering this Section. |
21 | | (c) The taxpayer must attach the certificate to the tax |
22 | | return on which the credits are to be claimed. The tax credit |
23 | | under this Section may not reduce the taxpayer's liability to |
24 | | less than
zero. If the amount of the credit exceeds the tax |
25 | | liability for the year, the excess credit may be carried |
26 | | forward and applied to the tax liability of the 5 taxable years |
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1 | | following the excess credit year. |
2 | | (c-1) Subject to appropriation, moneys in the Historic |
3 | | Property Administrative Fund shall be used, on a biennial |
4 | | basis beginning at the end of the second fiscal year after |
5 | | January 1, 2019 (the effective date of Public Act 100-629), to |
6 | | hire a qualified third party to prepare a biennial report to |
7 | | assess the overall economic impact to the State from the |
8 | | qualified rehabilitation projects under this Section completed |
9 | | in that year and in previous years. The overall economic |
10 | | impact shall include at least: (1) the direct and indirect or |
11 | | induced economic impacts of completed projects; (2) temporary, |
12 | | permanent, and construction jobs created; (3) sales, income, |
13 | | and property tax generation before, during construction, and |
14 | | after completion; and (4) indirect neighborhood impact after |
15 | | completion. The report shall be submitted to the Governor and |
16 | | the General Assembly. The report to the General Assembly shall |
17 | | be filed with the Clerk of the House of Representatives and the |
18 | | Secretary of the Senate in electronic form only, in the manner |
19 | | that the Clerk and the Secretary shall direct. |
20 | | (c-2) The Department of Natural Resources may adopt rules |
21 | | to implement this Section in addition to the rules expressly |
22 | | authorized in this Section. |
23 | | (d) As used in this Section, the following terms have the |
24 | | following meanings. |
25 | | "Phased rehabilitation" means a project that is completed |
26 | | in phases, as defined under Section 47 of the federal Internal |
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1 | | Revenue Code and pursuant to National Park Service regulations |
2 | | at 36 C.F.R. 67. |
3 | | "Placed in service" means the date when the property is |
4 | | placed in a condition or state of readiness and availability |
5 | | for a specifically assigned function as defined under Section |
6 | | 47 of the federal Internal Revenue Code and federal Treasury |
7 | | Regulation Sections 1.46 and 1.48. |
8 | | "Qualified expenditure" means all the costs and expenses |
9 | | defined as qualified rehabilitation expenditures under Section |
10 | | 47 of the federal Internal Revenue Code that were incurred in |
11 | | connection with a qualified historic structure. |
12 | | "Qualified historic structure" means a certified historic |
13 | | structure as defined under Section 47(c)(3) of the federal |
14 | | Internal Revenue Code. |
15 | | "Qualified rehabilitation plan" means a project that is |
16 | | approved by the Department of Natural Resources and the |
17 | | National Park Service as being consistent with the United |
18 | | States Secretary of the Interior's Standards for |
19 | | Rehabilitation. |
20 | | "Qualified taxpayer" means the owner of the qualified |
21 | | historic structure or any other person who qualifies for the |
22 | | federal rehabilitation credit allowed by Section 47 of the |
23 | | federal Internal Revenue Code with respect to that qualified |
24 | | historic structure. Partners, shareholders of subchapter S |
25 | | corporations, and owners of limited liability companies (if |
26 | | the limited liability company is treated as a partnership for |
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1 | | purposes of federal and State income taxation) are entitled to |
2 | | a credit under this Section to be determined in accordance |
3 | | with the determination of income and distributive share of |
4 | | income under Sections 702 and 703 and subchapter S of the |
5 | | Internal Revenue Code, provided that credits granted to a |
6 | | partnership, a limited liability company taxed as a |
7 | | partnership, or other multiple owners of property shall be |
8 | | passed through to the partners, members, or owners |
9 | | respectively on a pro rata basis or pursuant to an executed |
10 | | agreement among the partners, members, or owners documenting |
11 | | any alternate distribution method.
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12 | | (Source: P.A. 100-236, eff. 8-18-17; 100-629, eff. 1-1-19; |
13 | | 100-695, eff. 8-3-18; 101-9, eff. 6-5-19; 101-81, eff. |
14 | | 7-12-19.)
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15 | | Section 99. Effective date. This Act takes effect upon |
16 | | becoming law.
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