HB4578 103RD GENERAL ASSEMBLY

LRB103 35465 HLH 65534 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB4578

Introduced 1/31/2024, by Rep. Michael J. Kelly

SYNOPSIS AS INTRODUCED:

35 ILCS 5/235 new

Amends the Illinois Income Tax Act. Creates an income tax credit for taxpayers who have an approved NFPA 13D residential fire sprinkler system installed in a new or existing residential dwelling in the State during the taxable year. Provides that the credit shall be in an amount equal to 50% of the total cost of the installation but not to exceed $10,000 per taxpayer in any taxable year. Provides that the credit is exempt from the Act's automatic sunset provisions. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Income Tax Act is amended by adding Section 235 as follows:

(35 ILCS 5/235 new)

Sec. 235. Residential fire sprinkler installation credit.

(a) For taxable years ending on or after December 31, 2023, each taxpayer who has an approved NFPA 13D residential fire sprinkler system installed by a licensed fire sprinkler contractor in a new or existing residential dwelling in the State during the taxable year is entitled to a credit against the taxes imposed by subsections (a) and (b) of Section 201 in an amount equal to 50% of the total cost of the installation but not to exceed $10,000 per taxpayer in any taxable year.

(b) The taxpayer shall provide to the Department a copy of the final invoice showing the total cost of the installation of the fire sprinkler system. The invoice shall include the following:

(1) the water main tap fee, if required;

(2) fees and costs for combined sprinkler and domestic water service;

(3) costs associated with installing, modifying, or upgrading piping and valves; and

(4) all other installation and testing fees.

(c) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the five taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.

(d) As used in this Section, "approved NFPA 13D residential fire sprinkler system" means a residential fire sprinkler system that meets the requirements of NFPA 13D standards established by the National Fire Protection Association for one-family and 2-family residential dwellings.

(e) This Section is exempt from the provisions of Section 250.

Section 99. Effective date. This Act takes effect upon becoming law.