State of Illinois
2021 and 2022


Introduced 2/26/2021, by Sen. Mattie Hunter


New Act
35 ILCS 5/232 new

    Creates the Recovery and Mental Health Tax Credit Act. Provides that the Department of Human Services shall establish and administer a recovery tax credit program to provide tax incentives to qualified employers who employ eligible individuals in recovery from a substance use disorder or mental illness in part-time and full-time positions within Illinois. Creates the Advisory Council on Mental Illness and Substance Use Disorder Impacts on Employment Opportunities within Minority Communities. Sets forth the membership of the Council. Provides that the Council shall advise the Department of Human Services regarding employment of persons with mental illnesses and substance use disorders in minority communities. Amends the Illinois Income Tax Act to make conforming changes.

LRB102 10793 HLH 16123 b






SB1841LRB102 10793 HLH 16123 b

1    AN ACT concerning revenue.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 1. Short title. This Act may be cited as the
5Recovery and Mental Health Tax Credit Act.
6    Section 5. Findings.
7    (a) In the interest of reducing stigma, the General
8Assembly finds and declares that those residents of Illinois
9diagnosed with mental illness and substance use disorders
10should be eligible for and encouraged to seek gainful
12    (b) The General Assembly finds and declares that minority
13communities in the State have been more negatively impacted in
14employment opportunities for minority residents diagnosed with
15mental illness and substance use disorders and should receive
16additional employment opportunities and incentives for
17employing minority residents diagnosed with mental illness or
18substance use disorders.
19    (c) In the interest of providing additional employment
20opportunities for those residents of Illinois diagnosed with
21mental illness or substance use disorders, the General
22Assembly finds and declares that certain qualified employers
23who employ eligible individuals should be eligible for a tax



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2    Section 10. Definitions. As used in this Act:
3    "Department" means the Department of Human Services.
4    "Eligible individual" means an individual with a substance
5use disorder, as that term is defined under Section 1-10 of the
6Substance Use Disorder Act, or an individual with a mental
7illness as that term is defined under Section 1-129 of the
8Mental Health and Developmental Disabilities Code, who is in a
9state of wellness and recovery where there is an abatement of
10signs and symptoms that characterize active substance use
11disorder or mental illness and has demonstrated to the
12qualified employer's satisfaction, pursuant to regulations
13promulgated by the Department, that he or she has completed a
14course of treatment or is currently in receipt of treatment
15for such substance use disorder or mental illness. A relapse
16in an individual's state of wellness shall not make the
17individual ineligible, so long as the individual shows a
18continued commitment to recovery that aligns with an
19individual's relapse prevention plan discharge plan or
20recovery plan.
21    "Qualified employer" means an employer operating within
22the State that has received a certificate of tax credit from
23the Department after the Department has determined that the
25        (1) provides a recovery supportive environment for



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1    their employees evidenced by a formal working relationship
2    with a substance use disorder treatment provider or
3    facility or mental health provider or facility, each as
4    may be licensed or certified within the State of Illinois,
5    and providing reasonable accommodation to the employees to
6    address their substance use disorder or mental illness,
7    all at no cost or expense to the eligible individual; and
8        (2) satisfies all other criteria in this Section and
9    established by the Department to participate in the
10    recovery tax program created hereunder.
11    "Taxpayer" means any individual, corporation, partnership,
12trust, or other entity subject to the Illinois income tax. For
13the purposes of this Act, 2 individuals filing a joint return
14shall be considered one taxpayer.
15    Section 15. Authorization of tax credit program for
16individuals in recovery from substance use disorders or mental
18    (a) For taxable years beginning on or after January 1,
192022, the Department is authorized to and shall establish and
20administer a recovery tax credit program to provide tax
21incentives to qualified employers who employ eligible
22individuals in recovery from a substance use disorder or
23mental illness in part-time and full-time positions within
24Illinois. The Department shall award the tax credit by
25issuance of a certificate of tax credit to the qualified



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1employer, who will present the certificate of tax credit to
2the Department of Revenue as a credit against the qualified
3employer's tax obligation in accordance with this Act.
4    (b) To be a qualified employer, an employer must apply
5annually to the Department to claim a credit based upon
6eligible individuals employed during the preceding calendar
7year, using the forms prescribed by the Department. To be
8approved for a credit under this Act, the employer must:
9        (1) agree to provide to the Department the information
10    necessary to demonstrate that the employer has satisfied
11    program eligibility requirements and provided all
12    information requested or needed by the Department,
13    including the number of hours worked by the eligible
14    individual and other information necessary for the
15    Department to calculate the amount of credit permitted;
16    and
17        (2) agree to provide names, employer identification
18    numbers, amounts that the employer may claim, and other
19    information necessary for the Department to calculate any
20    tax credit.
21    (c) To be an eligible individual, the individual must be
22diagnosed with or have been diagnosed with a substance use
23disorder or mental illness. Disclosure by the eligible
24individual of his or her mental illness or substance use
25disorder shall be completely voluntary and his or her health
26information may not be shared or disclosed under this Act



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1without the eligible individual's express written consent. The
2eligible individual must have been employed by the qualified
3employer in the State for a minimum of 500 hours during the
4applicable calendar year and the tax credit may only begin on
5the date the eligible individual is hired by the qualified
6employer and ending on December 31 of that calendar year or the
7date that the eligible individual's employment with the
8qualified employer ends, whichever occurs first. Only one tax
9credit may be awarded for any eligible individual while
10employed by the same or related qualified employer. The hours
11of employment of 2 or more eligible individuals may not be
12aggregated to reach the minimum number of hours. If an
13eligible individual has worked in excess of 500 hours between
14the date of hiring and December 31 of that year, a qualified
15employer can elect to compute and claim a credit for such
16eligible individual in that year based on the hours worked by
17December 31. Alternatively, the qualified employer may elect
18to include such individual in the computation of the credit in
19the year immediately succeeding the year in which the eligible
20individual was hired. In that case, the credit shall be
21computed on the basis of all hours worked by the eligible
22individual from the date of hire to the earlier of the last day
23of employment or December 31 of the succeeding year.
24    (d) The aggregate amount of all credits the Department may
25award under this Act in any calendar year may not exceed



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1    (e) If the qualified employer's taxable year is a calendar
2year, the employer shall be entitled to claim the credit as
3shown on the certificate of tax credit on the calendar year
4return for which the certificate of tax credit was issued. If
5the certified employer's taxable year is a fiscal year, the
6qualified employer shall be entitled to claim the credit as
7shown on the certificate of tax credit on the return for the
8fiscal year that includes the last day of the calendar year
9covered by the certificate of tax credit.
10    (f) If Department criteria and all other requirements are
11met, a qualified employer shall be entitled to a tax credit
12equal to the product of $1 and the number of hours worked by
13each eligible individual during the eligible individual's
14period of employment with the qualified employer. The tax
15credit awarded hereunder may not exceed $2,000 per eligible
16individual employed by the qualified employer in the State. In
17determining the amount of tax credit that any qualified
18employer may claim, the Department shall review all claims
19submitted for credit by all employers and, to the extent that
20the total amount claimed by employers exceeds the amount
21allocated for this program in that calendar year, shall issue
22tax credits on a pro-rata basis corresponding to each
23qualified employer's share of the total amount claimed.
24    (g) No credit shall be taken under this Act if the taxpayer
25claims a federal income tax deduction for the employment of
26the eligible individual by a qualified employer.



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1    (h) No tax credit awarded under this Act may reduce a
2qualified employer's tax obligation to less than zero.
3    (i) The Department of Revenue shall review and accept the
4tax credit certificates issued by the Department and apply the
5tax credit towards the qualified employer's income tax
6obligation. A taxpayer that is a qualified employer that has
7received a certificate of tax credit from the Department shall
8be allowed a credit against the tax imposed equal to the amount
9shown on such certificate of tax credit. If the taxpayer is (i)
10a corporation having an election in effect under Subchapter S
11of the federal Internal Revenue Code, (ii) a partnership, or
12(iii) a limited liability company, the credit provided under
13this Act may be claimed by the shareholders of the
14corporation, the partners of the partnership, or the members
15of the limited liability company in the same manner as those
16shareholders, partners, or members account for their
17proportionate shares of the income or losses of the
18corporation, partnership, or limited liability company, or as
19provided in the bylaws or other executed agreement of the
20corporation, partnership, or limited liability company. In
21carrying out this Act, no patient-specific information shall
22be shared or disclosed. Any information collected by the
23Department or the Department of Revenue shall not be subject
24to public disclosure or Freedom of Information Act requests.
25    (j) The credit under this Act is exempt from the
26provisions of Section 250 of the Illinois Income Tax Act.



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1    Section 20. Advisory Council on Mental Illness and
2Substance Use Disorder Impacts on Employment Opportunities
3within Minority Communities. The Secretary of the Department
4shall appoint the Advisory Council on Mental Illness and
5Substance Use Disorder Impacts on Employment Opportunities
6within Minority Communities, to be composed of 15 members,
7which shall include a balanced representation of recipients,
8services providers, employers, local governmental units,
9community and welfare advocacy groups, academia, and the
10general public. The Advisory Council shall advise the
11Department regarding all aspects of employment impacts
12resulting from mental illnesses and substance use disorders
13within minority communities, tax credits, outreach, marketing,
14and education about the tax credit and employment
15opportunities, and other areas as deemed appropriate by the
16Secretary. In appointing the first Council, the Secretary
17shall name 8 members to 2-year terms and 7 members to serve
184-year terms, all of whom shall be appointed within 6 months of
19the effective date of this Act. All members appointed
20thereafter shall serve 4 year terms. Members shall serve
21without compensation other than reimbursement of expenses
22actually incurred in the performance of their official duties.
23At its first meeting, the Advisory Council shall select a
24chair from among its members. The Advisory Council shall meet
25at least quarterly and at other times at the call of the chair.



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1    Section 25. Powers. The Department shall adopt rules for
2the administration of this Act. The Department may enter into
3an intergovernmental agreement with the Department of Revenue
4for the administration of this Act.
5    Section 90. The Illinois Income Tax Act is amended by
6adding Section 232 as follows:
7    (35 ILCS 5/232 new)
8    Sec. 232. Recovery and Mental Health Tax Credit Act. A
9taxpayer who has been awarded a credit under the Recovery and
10Mental Health Tax Credit Act is entitled to a credit against
11the tax imposed by subsections (a) and (b) of Section 201 as
12provided in that Act. This Section is exempt from the
13provisions of Section 250.