| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
1 | AN ACT concerning revenue.
| |||||||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| |||||||||||||||||||||||
3 | represented in the General Assembly:
| |||||||||||||||||||||||
4 | Section 1. Short title. This Act may be cited as the Endow | |||||||||||||||||||||||
5 | Illinois Tax Credit Act. | |||||||||||||||||||||||
6 | Section 5. Definitions. As used in this Act: | |||||||||||||||||||||||
7 | "Business entity" means a corporation (including a | |||||||||||||||||||||||
8 | Subchapter S corporation), trust, estate, partnership, limited | |||||||||||||||||||||||
9 | liability company, or sole proprietorship. | |||||||||||||||||||||||
10 | "Consumer Price Index" means the index published by the | |||||||||||||||||||||||
11 | Bureau of Labor Statistics of the United States Department of | |||||||||||||||||||||||
12 | Labor that measures the average change in prices of goods and | |||||||||||||||||||||||
13 | services purchased by all urban consumers, United States city | |||||||||||||||||||||||
14 | average, all items, 1982-84 = 100. | |||||||||||||||||||||||
15 | "Credit-eligible endowment gift" means an endowment gift | |||||||||||||||||||||||
16 | for which a taxpayer intends to apply for an income tax credit | |||||||||||||||||||||||
17 | under this Act. | |||||||||||||||||||||||
18 | "Department" means the Department of Revenue. | |||||||||||||||||||||||
19 | "Donor advised fund" has the meaning given to that term in | |||||||||||||||||||||||
20 | subsection (d) of Section 4966 of the Internal Revenue Code of | |||||||||||||||||||||||
21 | 1986. | |||||||||||||||||||||||
22 | "Endowment gift" means an irrevocable contribution to a | |||||||||||||||||||||||
23 | permanent endowment fund held by a qualified community |
| |||||||
| |||||||
1 | foundation. | ||||||
2 | "Permanent endowment fund" means a fund that (i) is held | ||||||
3 | by a qualified community foundation, (ii) provides charitable | ||||||
4 | grants exclusively for the benefit of residents of the State | ||||||
5 | or charities and charitable projects located in the State, | ||||||
6 | (iii) is intended to exist in perpetuity, (iv) has an annual | ||||||
7 | spending rate based on the foundation spending policy, but not | ||||||
8 | to exceed 7%, and (v) is not a donor advised fund. | ||||||
9 | "Qualified community foundation" means a community | ||||||
10 | foundation or similar publicly supported organization | ||||||
11 | described in Section 170 (b)(1)(A)(vi) of the Internal Revenue | ||||||
12 | Code of 1986 that is organized or operating in this State and | ||||||
13 | that substantially complies with the national standards for | ||||||
14 | U.S. community foundations established by the National Council | ||||||
15 | on Foundations, as determined by the Department. | ||||||
16 | "Taxpayer" means any individual who is subject to the tax | ||||||
17 | imposed under subsections (a) and (b) of Section 201 of the | ||||||
18 | Illinois Income Tax Act or any business entity that is subject | ||||||
19 | to the tax imposed under subsections (a) and (b) of Section 201 | ||||||
20 | of the Illinois Income Tax Act. | ||||||
21 | Section 10. Tax credit awards; limitations. | ||||||
22 | (a) For taxable years ending on or after December 31, 2024 | ||||||
23 | and ending before January 1, 2034, the Department shall award, | ||||||
24 | in accordance with this Act, income tax credits to taxpayers | ||||||
25 | who provide an endowment gift to a permanent endowment fund |
| |||||||
| |||||||
1 | during the taxable year and receive a certificate of receipt | ||||||
2 | under Section 15 for that gift. Subject to the limitations in | ||||||
3 | this Section, the amount of the credit that may be awarded to a | ||||||
4 | taxpayer by the Department under this Act is an amount equal to | ||||||
5 | 25% of the endowment gift. | ||||||
6 | (b) The aggregate amount of all Endow Illinois tax credits | ||||||
7 | awarded by the Department under this Act in calendar year 2024 | ||||||
8 | may not exceed $50,000,000. In calendar year 2025 and each | ||||||
9 | calendar year thereafter, the aggregate amount of all Endow | ||||||
10 | Illinois tax credits awarded by the Department under this Act | ||||||
11 | may not exceed the maximum aggregate credit amount authorized | ||||||
12 | under this subsection for the immediately preceding calendar | ||||||
13 | year, multiplied by the sum of one plus the percentage | ||||||
14 | increase, if any, in the Consumer Price Index during the | ||||||
15 | 12-month period ending in September of that preceding calendar | ||||||
16 | year and rounded to the nearest $25,000. | ||||||
17 | (c) The aggregate amount of all Endow Illinois tax credits | ||||||
18 | that the Department may award to any taxpayer under this Act in | ||||||
19 | calendar year 2024 may not exceed $100,000. In calendar year | ||||||
20 | 2025 and each calendar year thereafter, the aggregate amount | ||||||
21 | of all Endow Illinois credits that the Department may award to | ||||||
22 | any taxpayer under this Act may not exceed the maximum credit | ||||||
23 | amount authorized under this subsection for any taxpayer in | ||||||
24 | the immediately preceding calendar year, multiplied by the sum | ||||||
25 | of one plus the percentage increase, if any, in the Consumer | ||||||
26 | Price Index during the 12-month period ending in September of |
| |||||||
| |||||||
1 | that preceding calendar year and rounded to the nearest | ||||||
2 | $1,000. | ||||||
3 | (d) The aggregate amount of all credits that the | ||||||
4 | Department may authorize in any calendar year based on | ||||||
5 | endowment gifts to any specific community foundation may not | ||||||
6 | exceed 15% of the aggregate amount of all Endow Illinois tax | ||||||
7 | credits authorized by the Department under this Act in that | ||||||
8 | calendar year. | ||||||
9 | (e) Of the annual amount available for tax credits, 10% | ||||||
10 | must be reserved for endowment gifts that do not exceed the | ||||||
11 | small gift maximum set forth in this subsection. For the | ||||||
12 | calendar year ending on December 31, 2024, the small gift | ||||||
13 | maximum is $30,000. For subsequent calendar years, the small | ||||||
14 | gift maximum is the small gift maximum for the immediately | ||||||
15 | preceding calendar year, multiplied by the sum of one plus the | ||||||
16 | percentage increase, if any, in the Consumer Price Index | ||||||
17 | during the 12-month period ending in September of that | ||||||
18 | immediately preceding calendar year and rounded to the nearest | ||||||
19 | $100. | ||||||
20 | (f) For the purpose of this Section, a credit is | ||||||
21 | considered to be awarded on the date the Department issues an | ||||||
22 | approved contribution authorization certificate under Section | ||||||
23 | 15. | ||||||
24 | Section 15. Applications for tax credits. | ||||||
25 | (a) The taxpayer shall apply to the Department, in the |
| |||||||
| |||||||
1 | form and manner prescribed by the Department, for a | ||||||
2 | contribution authorization certificate. A taxpayer who makes | ||||||
3 | more than one credit-eligible endowment gift must make a | ||||||
4 | separate application for each contribution authorization | ||||||
5 | certificate. Applications under this subsection shall be | ||||||
6 | reviewed by the Department and shall either be approved or | ||||||
7 | denied. Each approved contribution authorization certificate | ||||||
8 | shall be sent to the taxpayer within 3 business days after the | ||||||
9 | certificate is approved. The Department shall maintain on its | ||||||
10 | website a running total of: (i) the total amount of credits | ||||||
11 | remaining under this Act for which taxpayers may apply for a | ||||||
12 | contribution authorization certificate issued in the calendar | ||||||
13 | year; (ii) the total amount of credits allocated during the | ||||||
14 | calendar year for each specific community foundation; and | ||||||
15 | (iii) the total amount remaining for the calendar year under | ||||||
16 | the small gift maximum set forth in Section 10. Those running | ||||||
17 | totals shall be updated every business day. | ||||||
18 | (b) The taxpayer shall make the endowment gift to the | ||||||
19 | permanent endowment fund either prior to or within 60 days | ||||||
20 | after the taxpayer receives the approved contribution | ||||||
21 | authorization certificate under subsection (a). The qualified | ||||||
22 | community foundation shall, within 30 days after receipt of an | ||||||
23 | endowment gift for which a contribution authorization | ||||||
24 | certificate has been approved by the Department under | ||||||
25 | subsection (a), issue to the taxpayer a written certificate of | ||||||
26 | receipt, which shall contain the information required by the |
| |||||||
| |||||||
1 | Department by rule. No receipt shall be issued for amounts | ||||||
2 | that are not actually received by the qualified community | ||||||
3 | foundation within 60 days after the taxpayer receives the | ||||||
4 | approved contribution authorization certificate. | ||||||
5 | Section 20. Annual report. By March 31, 2025, and by March | ||||||
6 | 31 of each subsequent year, the Department must submit an | ||||||
7 | annual report to the Governor and the General Assembly | ||||||
8 | concerning the activities conducted under this Act during the | ||||||
9 | previous calendar year. The report must include a detailed | ||||||
10 | listing of tax credits authorized under this Act by the | ||||||
11 | Department. The report may not disclose any information if the | ||||||
12 | disclosure would violate Section 917 of the Illinois Income | ||||||
13 | Tax Act. | ||||||
14 | Section 25. Rulemaking. The Department may adopt rules for | ||||||
15 | the implementation of this Act. | ||||||
16 | Section 900. The Illinois Income Tax Act is amended by | ||||||
17 | changing Section 203 and by adding Section 234 as follows: | ||||||
18 | (35 ILCS 5/203) (from Ch. 120, par. 2-203) | ||||||
19 | Sec. 203. Base income defined. | ||||||
20 | (a) Individuals. | ||||||
21 | (1) In general. In the case of an individual, base | ||||||
22 | income means an
amount equal to the taxpayer's adjusted |
| |||||||
| |||||||
1 | gross income for the taxable
year as modified by paragraph | ||||||
2 | (2). | ||||||
3 | (2) Modifications. The adjusted gross income referred | ||||||
4 | to in
paragraph (1) shall be modified by adding thereto | ||||||
5 | the sum of the
following amounts: | ||||||
6 | (A) An amount equal to all amounts paid or accrued | ||||||
7 | to the taxpayer
as interest or dividends during the | ||||||
8 | taxable year to the extent excluded
from gross income | ||||||
9 | in the computation of adjusted gross income, except | ||||||
10 | stock
dividends of qualified public utilities | ||||||
11 | described in Section 305(e) of the
Internal Revenue | ||||||
12 | Code; | ||||||
13 | (B) An amount equal to the amount of tax imposed by | ||||||
14 | this Act to the
extent deducted from gross income in | ||||||
15 | the computation of adjusted gross
income for the | ||||||
16 | taxable year; | ||||||
17 | (C) An amount equal to the amount received during | ||||||
18 | the taxable year
as a recovery or refund of real | ||||||
19 | property taxes paid with respect to the
taxpayer's | ||||||
20 | principal residence under the Revenue Act of
1939 and | ||||||
21 | for which a deduction was previously taken under | ||||||
22 | subparagraph (L) of
this paragraph (2) prior to July | ||||||
23 | 1, 1991, the retrospective application date of
Article | ||||||
24 | 4 of Public Act 87-17. In the case of multi-unit or | ||||||
25 | multi-use
structures and farm dwellings, the taxes on | ||||||
26 | the taxpayer's principal residence
shall be that |
| |||||||
| |||||||
1 | portion of the total taxes for the entire property | ||||||
2 | which is
attributable to such principal residence; | ||||||
3 | (D) An amount equal to the amount of the capital | ||||||
4 | gain deduction
allowable under the Internal Revenue | ||||||
5 | Code, to the extent deducted from gross
income in the | ||||||
6 | computation of adjusted gross income; | ||||||
7 | (D-5) An amount, to the extent not included in | ||||||
8 | adjusted gross income,
equal to the amount of money | ||||||
9 | withdrawn by the taxpayer in the taxable year from
a | ||||||
10 | medical care savings account and the interest earned | ||||||
11 | on the account in the
taxable year of a withdrawal | ||||||
12 | pursuant to subsection (b) of Section 20 of the
| ||||||
13 | Medical Care Savings Account Act or subsection (b) of | ||||||
14 | Section 20 of the
Medical Care Savings Account Act of | ||||||
15 | 2000; | ||||||
16 | (D-10) For taxable years ending after December 31, | ||||||
17 | 1997, an
amount equal to any eligible remediation | ||||||
18 | costs that the individual
deducted in computing | ||||||
19 | adjusted gross income and for which the
individual | ||||||
20 | claims a credit under subsection (l) of Section 201; | ||||||
21 | (D-15) For taxable years 2001 and thereafter, an | ||||||
22 | amount equal to the
bonus depreciation deduction taken | ||||||
23 | on the taxpayer's federal income tax return for the | ||||||
24 | taxable
year under subsection (k) of Section 168 of | ||||||
25 | the Internal Revenue Code; | ||||||
26 | (D-16) If the taxpayer sells, transfers, abandons, |
| |||||||
| |||||||
1 | or otherwise disposes of property for which the | ||||||
2 | taxpayer was required in any taxable year to
make an | ||||||
3 | addition modification under subparagraph (D-15), then | ||||||
4 | an amount equal
to the aggregate amount of the | ||||||
5 | deductions taken in all taxable
years under | ||||||
6 | subparagraph (Z) with respect to that property. | ||||||
7 | If the taxpayer continues to own property through | ||||||
8 | the last day of the last tax year for which a | ||||||
9 | subtraction is allowed with respect to that property | ||||||
10 | under subparagraph (Z) and for which the taxpayer was | ||||||
11 | allowed in any taxable year to make a subtraction | ||||||
12 | modification under subparagraph (Z), then an amount | ||||||
13 | equal to that subtraction modification.
| ||||||
14 | The taxpayer is required to make the addition | ||||||
15 | modification under this
subparagraph
only once with | ||||||
16 | respect to any one piece of property; | ||||||
17 | (D-17) An amount equal to the amount otherwise | ||||||
18 | allowed as a deduction in computing base income for | ||||||
19 | interest paid, accrued, or incurred, directly or | ||||||
20 | indirectly, (i) for taxable years ending on or after | ||||||
21 | December 31, 2004, to a foreign person who would be a | ||||||
22 | member of the same unitary business group but for the | ||||||
23 | fact that foreign person's business activity outside | ||||||
24 | the United States is 80% or more of the foreign | ||||||
25 | person's total business activity and (ii) for taxable | ||||||
26 | years ending on or after December 31, 2008, to a person |
| |||||||
| |||||||
1 | who would be a member of the same unitary business | ||||||
2 | group but for the fact that the person is prohibited | ||||||
3 | under Section 1501(a)(27) from being included in the | ||||||
4 | unitary business group because he or she is ordinarily | ||||||
5 | required to apportion business income under different | ||||||
6 | subsections of Section 304. The addition modification | ||||||
7 | required by this subparagraph shall be reduced to the | ||||||
8 | extent that dividends were included in base income of | ||||||
9 | the unitary group for the same taxable year and | ||||||
10 | received by the taxpayer or by a member of the | ||||||
11 | taxpayer's unitary business group (including amounts | ||||||
12 | included in gross income under Sections 951 through | ||||||
13 | 964 of the Internal Revenue Code and amounts included | ||||||
14 | in gross income under Section 78 of the Internal | ||||||
15 | Revenue Code) with respect to the stock of the same | ||||||
16 | person to whom the interest was paid, accrued, or | ||||||
17 | incurred. | ||||||
18 | This paragraph shall not apply to the following:
| ||||||
19 | (i) an item of interest paid, accrued, or | ||||||
20 | incurred, directly or indirectly, to a person who | ||||||
21 | is subject in a foreign country or state, other | ||||||
22 | than a state which requires mandatory unitary | ||||||
23 | reporting, to a tax on or measured by net income | ||||||
24 | with respect to such interest; or | ||||||
25 | (ii) an item of interest paid, accrued, or | ||||||
26 | incurred, directly or indirectly, to a person if |
| |||||||
| |||||||
1 | the taxpayer can establish, based on a | ||||||
2 | preponderance of the evidence, both of the | ||||||
3 | following: | ||||||
4 | (a) the person, during the same taxable | ||||||
5 | year, paid, accrued, or incurred, the interest | ||||||
6 | to a person that is not a related member, and | ||||||
7 | (b) the transaction giving rise to the | ||||||
8 | interest expense between the taxpayer and the | ||||||
9 | person did not have as a principal purpose the | ||||||
10 | avoidance of Illinois income tax, and is paid | ||||||
11 | pursuant to a contract or agreement that | ||||||
12 | reflects an arm's-length interest rate and | ||||||
13 | terms; or
| ||||||
14 | (iii) the taxpayer can establish, based on | ||||||
15 | clear and convincing evidence, that the interest | ||||||
16 | paid, accrued, or incurred relates to a contract | ||||||
17 | or agreement entered into at arm's-length rates | ||||||
18 | and terms and the principal purpose for the | ||||||
19 | payment is not federal or Illinois tax avoidance; | ||||||
20 | or
| ||||||
21 | (iv) an item of interest paid, accrued, or | ||||||
22 | incurred, directly or indirectly, to a person if | ||||||
23 | the taxpayer establishes by clear and convincing | ||||||
24 | evidence that the adjustments are unreasonable; or | ||||||
25 | if the taxpayer and the Director agree in writing | ||||||
26 | to the application or use of an alternative method |
| |||||||
| |||||||
1 | of apportionment under Section 304(f).
| ||||||
2 | Nothing in this subsection shall preclude the | ||||||
3 | Director from making any other adjustment | ||||||
4 | otherwise allowed under Section 404 of this Act | ||||||
5 | for any tax year beginning after the effective | ||||||
6 | date of this amendment provided such adjustment is | ||||||
7 | made pursuant to regulation adopted by the | ||||||
8 | Department and such regulations provide methods | ||||||
9 | and standards by which the Department will utilize | ||||||
10 | its authority under Section 404 of this Act;
| ||||||
11 | (D-18) An amount equal to the amount of intangible | ||||||
12 | expenses and costs otherwise allowed as a deduction in | ||||||
13 | computing base income, and that were paid, accrued, or | ||||||
14 | incurred, directly or indirectly, (i) for taxable | ||||||
15 | years ending on or after December 31, 2004, to a | ||||||
16 | foreign person who would be a member of the same | ||||||
17 | unitary business group but for the fact that the | ||||||
18 | foreign person's business activity outside the United | ||||||
19 | States is 80% or more of that person's total business | ||||||
20 | activity and (ii) for taxable years ending on or after | ||||||
21 | December 31, 2008, to a person who would be a member of | ||||||
22 | the same unitary business group but for the fact that | ||||||
23 | the person is prohibited under Section 1501(a)(27) | ||||||
24 | from being included in the unitary business group | ||||||
25 | because he or she is ordinarily required to apportion | ||||||
26 | business income under different subsections of Section |
| |||||||
| |||||||
1 | 304. The addition modification required by this | ||||||
2 | subparagraph shall be reduced to the extent that | ||||||
3 | dividends were included in base income of the unitary | ||||||
4 | group for the same taxable year and received by the | ||||||
5 | taxpayer or by a member of the taxpayer's unitary | ||||||
6 | business group (including amounts included in gross | ||||||
7 | income under Sections 951 through 964 of the Internal | ||||||
8 | Revenue Code and amounts included in gross income | ||||||
9 | under Section 78 of the Internal Revenue Code) with | ||||||
10 | respect to the stock of the same person to whom the | ||||||
11 | intangible expenses and costs were directly or | ||||||
12 | indirectly paid, incurred, or accrued. The preceding | ||||||
13 | sentence does not apply to the extent that the same | ||||||
14 | dividends caused a reduction to the addition | ||||||
15 | modification required under Section 203(a)(2)(D-17) of | ||||||
16 | this Act. As used in this subparagraph, the term | ||||||
17 | "intangible expenses and costs" includes (1) expenses, | ||||||
18 | losses, and costs for, or related to, the direct or | ||||||
19 | indirect acquisition, use, maintenance or management, | ||||||
20 | ownership, sale, exchange, or any other disposition of | ||||||
21 | intangible property; (2) losses incurred, directly or | ||||||
22 | indirectly, from factoring transactions or discounting | ||||||
23 | transactions; (3) royalty, patent, technical, and | ||||||
24 | copyright fees; (4) licensing fees; and (5) other | ||||||
25 | similar expenses and costs.
For purposes of this | ||||||
26 | subparagraph, "intangible property" includes patents, |
| |||||||
| |||||||
1 | patent applications, trade names, trademarks, service | ||||||
2 | marks, copyrights, mask works, trade secrets, and | ||||||
3 | similar types of intangible assets. | ||||||
4 | This paragraph shall not apply to the following: | ||||||
5 | (i) any item of intangible expenses or costs | ||||||
6 | paid, accrued, or incurred, directly or | ||||||
7 | indirectly, from a transaction with a person who | ||||||
8 | is subject in a foreign country or state, other | ||||||
9 | than a state which requires mandatory unitary | ||||||
10 | reporting, to a tax on or measured by net income | ||||||
11 | with respect to such item; or | ||||||
12 | (ii) any item of intangible expense or cost | ||||||
13 | paid, accrued, or incurred, directly or | ||||||
14 | indirectly, if the taxpayer can establish, based | ||||||
15 | on a preponderance of the evidence, both of the | ||||||
16 | following: | ||||||
17 | (a) the person during the same taxable | ||||||
18 | year paid, accrued, or incurred, the | ||||||
19 | intangible expense or cost to a person that is | ||||||
20 | not a related member, and | ||||||
21 | (b) the transaction giving rise to the | ||||||
22 | intangible expense or cost between the | ||||||
23 | taxpayer and the person did not have as a | ||||||
24 | principal purpose the avoidance of Illinois | ||||||
25 | income tax, and is paid pursuant to a contract | ||||||
26 | or agreement that reflects arm's-length terms; |
| |||||||
| |||||||
1 | or | ||||||
2 | (iii) any item of intangible expense or cost | ||||||
3 | paid, accrued, or incurred, directly or | ||||||
4 | indirectly, from a transaction with a person if | ||||||
5 | the taxpayer establishes by clear and convincing | ||||||
6 | evidence, that the adjustments are unreasonable; | ||||||
7 | or if the taxpayer and the Director agree in | ||||||
8 | writing to the application or use of an | ||||||
9 | alternative method of apportionment under Section | ||||||
10 | 304(f);
| ||||||
11 | Nothing in this subsection shall preclude the | ||||||
12 | Director from making any other adjustment | ||||||
13 | otherwise allowed under Section 404 of this Act | ||||||
14 | for any tax year beginning after the effective | ||||||
15 | date of this amendment provided such adjustment is | ||||||
16 | made pursuant to regulation adopted by the | ||||||
17 | Department and such regulations provide methods | ||||||
18 | and standards by which the Department will utilize | ||||||
19 | its authority under Section 404 of this Act;
| ||||||
20 | (D-19) For taxable years ending on or after | ||||||
21 | December 31, 2008, an amount equal to the amount of | ||||||
22 | insurance premium expenses and costs otherwise allowed | ||||||
23 | as a deduction in computing base income, and that were | ||||||
24 | paid, accrued, or incurred, directly or indirectly, to | ||||||
25 | a person who would be a member of the same unitary | ||||||
26 | business group but for the fact that the person is |
| |||||||
| |||||||
1 | prohibited under Section 1501(a)(27) from being | ||||||
2 | included in the unitary business group because he or | ||||||
3 | she is ordinarily required to apportion business | ||||||
4 | income under different subsections of Section 304. The | ||||||
5 | addition modification required by this subparagraph | ||||||
6 | shall be reduced to the extent that dividends were | ||||||
7 | included in base income of the unitary group for the | ||||||
8 | same taxable year and received by the taxpayer or by a | ||||||
9 | member of the taxpayer's unitary business group | ||||||
10 | (including amounts included in gross income under | ||||||
11 | Sections 951 through 964 of the Internal Revenue Code | ||||||
12 | and amounts included in gross income under Section 78 | ||||||
13 | of the Internal Revenue Code) with respect to the | ||||||
14 | stock of the same person to whom the premiums and costs | ||||||
15 | were directly or indirectly paid, incurred, or | ||||||
16 | accrued. The preceding sentence does not apply to the | ||||||
17 | extent that the same dividends caused a reduction to | ||||||
18 | the addition modification required under Section | ||||||
19 | 203(a)(2)(D-17) or Section 203(a)(2)(D-18) of this | ||||||
20 | Act;
| ||||||
21 | (D-20) For taxable years beginning on or after | ||||||
22 | January 1,
2002 and ending on or before December 31, | ||||||
23 | 2006, in
the
case of a distribution from a qualified | ||||||
24 | tuition program under Section 529 of
the Internal | ||||||
25 | Revenue Code, other than (i) a distribution from a | ||||||
26 | College Savings
Pool created under Section 16.5 of the |
| |||||||
| |||||||
1 | State Treasurer Act or (ii) a
distribution from the | ||||||
2 | Illinois Prepaid Tuition Trust Fund, an amount equal | ||||||
3 | to
the amount excluded from gross income under Section | ||||||
4 | 529(c)(3)(B). For taxable years beginning on or after | ||||||
5 | January 1, 2007, in the case of a distribution from a | ||||||
6 | qualified tuition program under Section 529 of the | ||||||
7 | Internal Revenue Code, other than (i) a distribution | ||||||
8 | from a College Savings Pool created under Section 16.5 | ||||||
9 | of the State Treasurer Act, (ii) a distribution from | ||||||
10 | the Illinois Prepaid Tuition Trust Fund, or (iii) a | ||||||
11 | distribution from a qualified tuition program under | ||||||
12 | Section 529 of the Internal Revenue Code that (I) | ||||||
13 | adopts and determines that its offering materials | ||||||
14 | comply with the College Savings Plans Network's | ||||||
15 | disclosure principles and (II) has made reasonable | ||||||
16 | efforts to inform in-state residents of the existence | ||||||
17 | of in-state qualified tuition programs by informing | ||||||
18 | Illinois residents directly and, where applicable, to | ||||||
19 | inform financial intermediaries distributing the | ||||||
20 | program to inform in-state residents of the existence | ||||||
21 | of in-state qualified tuition programs at least | ||||||
22 | annually, an amount equal to the amount excluded from | ||||||
23 | gross income under Section 529(c)(3)(B). | ||||||
24 | For the purposes of this subparagraph (D-20), a | ||||||
25 | qualified tuition program has made reasonable efforts | ||||||
26 | if it makes disclosures (which may use the term |
| |||||||
| |||||||
1 | "in-state program" or "in-state plan" and need not | ||||||
2 | specifically refer to Illinois or its qualified | ||||||
3 | programs by name) (i) directly to prospective | ||||||
4 | participants in its offering materials or makes a | ||||||
5 | public disclosure, such as a website posting; and (ii) | ||||||
6 | where applicable, to intermediaries selling the | ||||||
7 | out-of-state program in the same manner that the | ||||||
8 | out-of-state program distributes its offering | ||||||
9 | materials; | ||||||
10 | (D-20.5) For taxable years beginning on or after | ||||||
11 | January 1, 2018, in the case of a distribution from a | ||||||
12 | qualified ABLE program under Section 529A of the | ||||||
13 | Internal Revenue Code, other than a distribution from | ||||||
14 | a qualified ABLE program created under Section 16.6 of | ||||||
15 | the State Treasurer Act, an amount equal to the amount | ||||||
16 | excluded from gross income under Section 529A(c)(1)(B) | ||||||
17 | of the Internal Revenue Code; | ||||||
18 | (D-21) For taxable years beginning on or after | ||||||
19 | January 1, 2007, in the case of transfer of moneys from | ||||||
20 | a qualified tuition program under Section 529 of the | ||||||
21 | Internal Revenue Code that is administered by the | ||||||
22 | State to an out-of-state program, an amount equal to | ||||||
23 | the amount of moneys previously deducted from base | ||||||
24 | income under subsection (a)(2)(Y) of this Section; | ||||||
25 | (D-21.5) For taxable years beginning on or after | ||||||
26 | January 1, 2018, in the case of the transfer of moneys |
| |||||||
| |||||||
1 | from a qualified tuition program under Section 529 or | ||||||
2 | a qualified ABLE program under Section 529A of the | ||||||
3 | Internal Revenue Code that is administered by this | ||||||
4 | State to an ABLE account established under an | ||||||
5 | out-of-state ABLE account program, an amount equal to | ||||||
6 | the contribution component of the transferred amount | ||||||
7 | that was previously deducted from base income under | ||||||
8 | subsection (a)(2)(Y) or subsection (a)(2)(HH) of this | ||||||
9 | Section; | ||||||
10 | (D-22) For taxable years beginning on or after | ||||||
11 | January 1, 2009, and prior to January 1, 2018, in the | ||||||
12 | case of a nonqualified withdrawal or refund of moneys | ||||||
13 | from a qualified tuition program under Section 529 of | ||||||
14 | the Internal Revenue Code administered by the State | ||||||
15 | that is not used for qualified expenses at an eligible | ||||||
16 | education institution, an amount equal to the | ||||||
17 | contribution component of the nonqualified withdrawal | ||||||
18 | or refund that was previously deducted from base | ||||||
19 | income under subsection (a)(2)(y) of this Section, | ||||||
20 | provided that the withdrawal or refund did not result | ||||||
21 | from the beneficiary's death or disability. For | ||||||
22 | taxable years beginning on or after January 1, 2018: | ||||||
23 | (1) in the case of a nonqualified withdrawal or | ||||||
24 | refund, as defined under Section
16.5 of the State | ||||||
25 | Treasurer Act, of moneys from a qualified tuition | ||||||
26 | program under Section 529 of the Internal Revenue Code |
| |||||||
| |||||||
1 | administered by the State, an amount equal to the | ||||||
2 | contribution component of the nonqualified withdrawal | ||||||
3 | or refund that was previously deducted from base
| ||||||
4 | income under subsection (a)(2)(Y) of this Section, and | ||||||
5 | (2) in the case of a nonqualified withdrawal or refund | ||||||
6 | from a qualified ABLE program under Section 529A of | ||||||
7 | the Internal Revenue Code administered by the State | ||||||
8 | that is not used for qualified disability expenses, an | ||||||
9 | amount equal to the contribution component of the | ||||||
10 | nonqualified withdrawal or refund that was previously | ||||||
11 | deducted from base income under subsection (a)(2)(HH) | ||||||
12 | of this Section; | ||||||
13 | (D-23) An amount equal to the credit allowable to | ||||||
14 | the taxpayer under Section 218(a) of this Act, | ||||||
15 | determined without regard to Section 218(c) of this | ||||||
16 | Act; | ||||||
17 | (D-24) For taxable years ending on or after | ||||||
18 | December 31, 2017, an amount equal to the deduction | ||||||
19 | allowed under Section 199 of the Internal Revenue Code | ||||||
20 | for the taxable year; | ||||||
21 | (D-25) In the case of a resident, an amount equal | ||||||
22 | to the amount of tax for which a credit is allowed | ||||||
23 | pursuant to Section 201(p)(7) of this Act; | ||||||
24 | (D-26) the amount that is claimed as a federal | ||||||
25 | deduction when computing the taxpayer's federal | ||||||
26 | taxable income for the taxable year and that is |
| |||||||
| |||||||
1 | attributable to an endowment gift for which the | ||||||
2 | taxpayer receives a credit under the Endow Illinois | ||||||
3 | Tax Credit Act; | ||||||
4 | and by deducting from the total so obtained the
sum of the | ||||||
5 | following amounts: | ||||||
6 | (E) For taxable years ending before December 31, | ||||||
7 | 2001,
any amount included in such total in respect of | ||||||
8 | any compensation
(including but not limited to any | ||||||
9 | compensation paid or accrued to a
serviceman while a | ||||||
10 | prisoner of war or missing in action) paid to a | ||||||
11 | resident
by reason of being on active duty in the Armed | ||||||
12 | Forces of the United States
and in respect of any | ||||||
13 | compensation paid or accrued to a resident who as a
| ||||||
14 | governmental employee was a prisoner of war or missing | ||||||
15 | in action, and in
respect of any compensation paid to a | ||||||
16 | resident in 1971 or thereafter for
annual training | ||||||
17 | performed pursuant to Sections 502 and 503, Title 32,
| ||||||
18 | United States Code as a member of the Illinois | ||||||
19 | National Guard or, beginning with taxable years ending | ||||||
20 | on or after December 31, 2007, the National Guard of | ||||||
21 | any other state.
For taxable years ending on or after | ||||||
22 | December 31, 2001, any amount included in
such total | ||||||
23 | in respect of any compensation (including but not | ||||||
24 | limited to any
compensation paid or accrued to a | ||||||
25 | serviceman while a prisoner of war or missing
in | ||||||
26 | action) paid to a resident by reason of being a member |
| |||||||
| |||||||
1 | of any component of
the Armed Forces of the United | ||||||
2 | States and in respect of any compensation paid
or | ||||||
3 | accrued to a resident who as a governmental employee | ||||||
4 | was a prisoner of war
or missing in action, and in | ||||||
5 | respect of any compensation paid to a resident in
2001 | ||||||
6 | or thereafter by reason of being a member of the | ||||||
7 | Illinois National Guard or, beginning with taxable | ||||||
8 | years ending on or after December 31, 2007, the | ||||||
9 | National Guard of any other state.
The provisions of | ||||||
10 | this subparagraph (E) are exempt
from the provisions | ||||||
11 | of Section 250; | ||||||
12 | (F) An amount equal to all amounts included in | ||||||
13 | such total pursuant
to the provisions of Sections | ||||||
14 | 402(a), 402(c), 403(a), 403(b), 406(a), 407(a),
and | ||||||
15 | 408 of the Internal Revenue Code, or included in such | ||||||
16 | total as
distributions under the provisions of any | ||||||
17 | retirement or disability plan for
employees of any | ||||||
18 | governmental agency or unit, or retirement payments to
| ||||||
19 | retired partners, which payments are excluded in | ||||||
20 | computing net earnings
from self employment by Section | ||||||
21 | 1402 of the Internal Revenue Code and
regulations | ||||||
22 | adopted pursuant thereto; | ||||||
23 | (G) The valuation limitation amount; | ||||||
24 | (H) An amount equal to the amount of any tax | ||||||
25 | imposed by this Act
which was refunded to the taxpayer | ||||||
26 | and included in such total for the
taxable year; |
| |||||||
| |||||||
1 | (I) An amount equal to all amounts included in | ||||||
2 | such total pursuant
to the provisions of Section 111 | ||||||
3 | of the Internal Revenue Code as a
recovery of items | ||||||
4 | previously deducted from adjusted gross income in the
| ||||||
5 | computation of taxable income; | ||||||
6 | (J) An amount equal to those dividends included in | ||||||
7 | such total which were
paid by a corporation which | ||||||
8 | conducts business operations in a River Edge | ||||||
9 | Redevelopment Zone or zones created under the River | ||||||
10 | Edge Redevelopment Zone Act, and conducts
| ||||||
11 | substantially all of its operations in a River Edge | ||||||
12 | Redevelopment Zone or zones. This subparagraph (J) is | ||||||
13 | exempt from the provisions of Section 250; | ||||||
14 | (K) An amount equal to those dividends included in | ||||||
15 | such total that
were paid by a corporation that | ||||||
16 | conducts business operations in a federally
designated | ||||||
17 | Foreign Trade Zone or Sub-Zone and that is designated | ||||||
18 | a High Impact
Business located in Illinois; provided | ||||||
19 | that dividends eligible for the
deduction provided in | ||||||
20 | subparagraph (J) of paragraph (2) of this subsection
| ||||||
21 | shall not be eligible for the deduction provided under | ||||||
22 | this subparagraph
(K); | ||||||
23 | (L) For taxable years ending after December 31, | ||||||
24 | 1983, an amount equal to
all social security benefits | ||||||
25 | and railroad retirement benefits included in
such | ||||||
26 | total pursuant to Sections 72(r) and 86 of the |
| |||||||
| |||||||
1 | Internal Revenue Code; | ||||||
2 | (M) With the exception of any amounts subtracted | ||||||
3 | under subparagraph
(N), an amount equal to the sum of | ||||||
4 | all amounts disallowed as
deductions by (i) Sections | ||||||
5 | 171(a)(2) and 265(a)(2) of the Internal Revenue Code, | ||||||
6 | and all amounts of expenses allocable
to interest and | ||||||
7 | disallowed as deductions by Section 265(a)(1) of the | ||||||
8 | Internal
Revenue Code;
and (ii) for taxable years
| ||||||
9 | ending on or after August 13, 1999, Sections | ||||||
10 | 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of the | ||||||
11 | Internal Revenue Code, plus, for taxable years ending | ||||||
12 | on or after December 31, 2011, Section 45G(e)(3) of | ||||||
13 | the Internal Revenue Code and, for taxable years | ||||||
14 | ending on or after December 31, 2008, any amount | ||||||
15 | included in gross income under Section 87 of the | ||||||
16 | Internal Revenue Code; the provisions of this
| ||||||
17 | subparagraph are exempt from the provisions of Section | ||||||
18 | 250; | ||||||
19 | (N) An amount equal to all amounts included in | ||||||
20 | such total which are
exempt from taxation by this | ||||||
21 | State either by reason of its statutes or
Constitution
| ||||||
22 | or by reason of the Constitution, treaties or statutes | ||||||
23 | of the United States;
provided that, in the case of any | ||||||
24 | statute of this State that exempts income
derived from | ||||||
25 | bonds or other obligations from the tax imposed under | ||||||
26 | this Act,
the amount exempted shall be the interest |
| |||||||
| |||||||
1 | net of bond premium amortization; | ||||||
2 | (O) An amount equal to any contribution made to a | ||||||
3 | job training
project established pursuant to the Tax | ||||||
4 | Increment Allocation Redevelopment Act; | ||||||
5 | (P) An amount equal to the amount of the deduction | ||||||
6 | used to compute the
federal income tax credit for | ||||||
7 | restoration of substantial amounts held under
claim of | ||||||
8 | right for the taxable year pursuant to Section 1341 of | ||||||
9 | the
Internal Revenue Code or of any itemized deduction | ||||||
10 | taken from adjusted gross income in the computation of | ||||||
11 | taxable income for restoration of substantial amounts | ||||||
12 | held under claim of right for the taxable year; | ||||||
13 | (Q) An amount equal to any amounts included in | ||||||
14 | such total, received by
the taxpayer as an | ||||||
15 | acceleration in the payment of life, endowment or | ||||||
16 | annuity
benefits in advance of the time they would | ||||||
17 | otherwise be payable as an indemnity
for a terminal | ||||||
18 | illness; | ||||||
19 | (R) An amount equal to the amount of any federal or | ||||||
20 | State bonus paid
to veterans of the Persian Gulf War; | ||||||
21 | (S) An amount, to the extent included in adjusted | ||||||
22 | gross income, equal
to the amount of a contribution | ||||||
23 | made in the taxable year on behalf of the
taxpayer to a | ||||||
24 | medical care savings account established under the | ||||||
25 | Medical Care
Savings Account Act or the Medical Care | ||||||
26 | Savings Account Act of 2000 to the
extent the |
| |||||||
| |||||||
1 | contribution is accepted by the account
administrator | ||||||
2 | as provided in that Act; | ||||||
3 | (T) An amount, to the extent included in adjusted | ||||||
4 | gross income, equal to
the amount of interest earned | ||||||
5 | in the taxable year on a medical care savings
account | ||||||
6 | established under the Medical Care Savings Account Act | ||||||
7 | or the Medical
Care Savings Account Act of 2000 on | ||||||
8 | behalf of the
taxpayer, other than interest added | ||||||
9 | pursuant to item (D-5) of this paragraph
(2); | ||||||
10 | (U) For one taxable year beginning on or after | ||||||
11 | January 1,
1994, an
amount equal to the total amount of | ||||||
12 | tax imposed and paid under subsections (a)
and (b) of | ||||||
13 | Section 201 of this Act on grant amounts received by | ||||||
14 | the taxpayer
under the Nursing Home Grant Assistance | ||||||
15 | Act during the taxpayer's taxable years
1992 and 1993; | ||||||
16 | (V) Beginning with tax years ending on or after | ||||||
17 | December 31, 1995 and
ending with tax years ending on | ||||||
18 | or before December 31, 2004, an amount equal to
the | ||||||
19 | amount paid by a taxpayer who is a
self-employed | ||||||
20 | taxpayer, a partner of a partnership, or a
shareholder | ||||||
21 | in a Subchapter S corporation for health insurance or | ||||||
22 | long-term
care insurance for that taxpayer or that | ||||||
23 | taxpayer's spouse or dependents, to
the extent that | ||||||
24 | the amount paid for that health insurance or long-term | ||||||
25 | care
insurance may be deducted under Section 213 of | ||||||
26 | the Internal Revenue Code, has not been deducted on |
| |||||||
| |||||||
1 | the federal income tax return of the taxpayer,
and | ||||||
2 | does not exceed the taxable income attributable to | ||||||
3 | that taxpayer's income,
self-employment income, or | ||||||
4 | Subchapter S corporation income; except that no
| ||||||
5 | deduction shall be allowed under this item (V) if the | ||||||
6 | taxpayer is eligible to
participate in any health | ||||||
7 | insurance or long-term care insurance plan of an
| ||||||
8 | employer of the taxpayer or the taxpayer's
spouse. The | ||||||
9 | amount of the health insurance and long-term care | ||||||
10 | insurance
subtracted under this item (V) shall be | ||||||
11 | determined by multiplying total
health insurance and | ||||||
12 | long-term care insurance premiums paid by the taxpayer
| ||||||
13 | times a number that represents the fractional | ||||||
14 | percentage of eligible medical
expenses under Section | ||||||
15 | 213 of the Internal Revenue Code of 1986 not actually
| ||||||
16 | deducted on the taxpayer's federal income tax return; | ||||||
17 | (W) For taxable years beginning on or after | ||||||
18 | January 1, 1998,
all amounts included in the | ||||||
19 | taxpayer's federal gross income
in the taxable year | ||||||
20 | from amounts converted from a regular IRA to a Roth | ||||||
21 | IRA.
This paragraph is exempt from the provisions of | ||||||
22 | Section
250; | ||||||
23 | (X) For taxable year 1999 and thereafter, an | ||||||
24 | amount equal to the
amount of any (i) distributions, | ||||||
25 | to the extent includible in gross income for
federal | ||||||
26 | income tax purposes, made to the taxpayer because of |
| |||||||
| |||||||
1 | his or her status
as a victim of persecution for racial | ||||||
2 | or religious reasons by Nazi Germany or
any other Axis | ||||||
3 | regime or as an heir of the victim and (ii) items
of | ||||||
4 | income, to the extent
includible in gross income for | ||||||
5 | federal income tax purposes, attributable to,
derived | ||||||
6 | from or in any way related to assets stolen from, | ||||||
7 | hidden from, or
otherwise lost to a victim of
| ||||||
8 | persecution for racial or religious reasons by Nazi | ||||||
9 | Germany or any other Axis
regime immediately prior to, | ||||||
10 | during, and immediately after World War II,
including, | ||||||
11 | but
not limited to, interest on the proceeds | ||||||
12 | receivable as insurance
under policies issued to a | ||||||
13 | victim of persecution for racial or religious
reasons
| ||||||
14 | by Nazi Germany or any other Axis regime by European | ||||||
15 | insurance companies
immediately prior to and during | ||||||
16 | World War II;
provided, however, this subtraction from | ||||||
17 | federal adjusted gross income does not
apply to assets | ||||||
18 | acquired with such assets or with the proceeds from | ||||||
19 | the sale of
such assets; provided, further, this | ||||||
20 | paragraph shall only apply to a taxpayer
who was the | ||||||
21 | first recipient of such assets after their recovery | ||||||
22 | and who is a
victim of persecution for racial or | ||||||
23 | religious reasons
by Nazi Germany or any other Axis | ||||||
24 | regime or as an heir of the victim. The
amount of and | ||||||
25 | the eligibility for any public assistance, benefit, or
| ||||||
26 | similar entitlement is not affected by the inclusion |
| |||||||
| |||||||
1 | of items (i) and (ii) of
this paragraph in gross income | ||||||
2 | for federal income tax purposes.
This paragraph is | ||||||
3 | exempt from the provisions of Section 250; | ||||||
4 | (Y) For taxable years beginning on or after | ||||||
5 | January 1, 2002
and ending
on or before December 31, | ||||||
6 | 2004, moneys contributed in the taxable year to a | ||||||
7 | College Savings Pool account under
Section 16.5 of the | ||||||
8 | State Treasurer Act, except that amounts excluded from
| ||||||
9 | gross income under Section 529(c)(3)(C)(i) of the | ||||||
10 | Internal Revenue Code
shall not be considered moneys | ||||||
11 | contributed under this subparagraph (Y). For taxable | ||||||
12 | years beginning on or after January 1, 2005, a maximum | ||||||
13 | of $10,000
contributed
in the
taxable year to (i) a | ||||||
14 | College Savings Pool account under Section 16.5 of the
| ||||||
15 | State
Treasurer Act or (ii) the Illinois Prepaid | ||||||
16 | Tuition Trust Fund,
except that
amounts excluded from | ||||||
17 | gross income under Section 529(c)(3)(C)(i) of the
| ||||||
18 | Internal
Revenue Code shall not be considered moneys | ||||||
19 | contributed under this subparagraph
(Y). For purposes | ||||||
20 | of this subparagraph, contributions made by an | ||||||
21 | employer on behalf of an employee, or matching | ||||||
22 | contributions made by an employee, shall be treated as | ||||||
23 | made by the employee. This
subparagraph (Y) is exempt | ||||||
24 | from the provisions of Section 250; | ||||||
25 | (Z) For taxable years 2001 and thereafter, for the | ||||||
26 | taxable year in
which the bonus depreciation deduction
|
| |||||||
| |||||||
1 | is taken on the taxpayer's federal income tax return | ||||||
2 | under
subsection (k) of Section 168 of the Internal | ||||||
3 | Revenue Code and for each
applicable taxable year | ||||||
4 | thereafter, an amount equal to "x", where: | ||||||
5 | (1) "y" equals the amount of the depreciation | ||||||
6 | deduction taken for the
taxable year
on the | ||||||
7 | taxpayer's federal income tax return on property | ||||||
8 | for which the bonus
depreciation deduction
was | ||||||
9 | taken in any year under subsection (k) of Section | ||||||
10 | 168 of the Internal
Revenue Code, but not | ||||||
11 | including the bonus depreciation deduction; | ||||||
12 | (2) for taxable years ending on or before | ||||||
13 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
14 | and then divided by 70 (or "y"
multiplied by | ||||||
15 | 0.429); and | ||||||
16 | (3) for taxable years ending after December | ||||||
17 | 31, 2005: | ||||||
18 | (i) for property on which a bonus | ||||||
19 | depreciation deduction of 30% of the adjusted | ||||||
20 | basis was taken, "x" equals "y" multiplied by | ||||||
21 | 30 and then divided by 70 (or "y"
multiplied | ||||||
22 | by 0.429); | ||||||
23 | (ii) for property on which a bonus | ||||||
24 | depreciation deduction of 50% of the adjusted | ||||||
25 | basis was taken, "x" equals "y" multiplied by | ||||||
26 | 1.0; |
| |||||||
| |||||||
1 | (iii) for property on which a bonus | ||||||
2 | depreciation deduction of 100% of the adjusted | ||||||
3 | basis was taken in a taxable year ending on or | ||||||
4 | after December 31, 2021, "x" equals the | ||||||
5 | depreciation deduction that would be allowed | ||||||
6 | on that property if the taxpayer had made the | ||||||
7 | election under Section 168(k)(7) of the | ||||||
8 | Internal Revenue Code to not claim bonus | ||||||
9 | depreciation on that property; and | ||||||
10 | (iv) for property on which a bonus | ||||||
11 | depreciation deduction of a percentage other | ||||||
12 | than 30%, 50% or 100% of the adjusted basis | ||||||
13 | was taken in a taxable year ending on or after | ||||||
14 | December 31, 2021, "x" equals "y" multiplied | ||||||
15 | by 100 times the percentage bonus depreciation | ||||||
16 | on the property (that is, 100(bonus%)) and | ||||||
17 | then divided by 100 times 1 minus the | ||||||
18 | percentage bonus depreciation on the property | ||||||
19 | (that is, 100(1–bonus%)). | ||||||
20 | The aggregate amount deducted under this | ||||||
21 | subparagraph in all taxable
years for any one piece of | ||||||
22 | property may not exceed the amount of the bonus
| ||||||
23 | depreciation deduction
taken on that property on the | ||||||
24 | taxpayer's federal income tax return under
subsection | ||||||
25 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
26 | subparagraph (Z) is exempt from the provisions of |
| |||||||
| |||||||
1 | Section 250; | ||||||
2 | (AA) If the taxpayer sells, transfers, abandons, | ||||||
3 | or otherwise disposes of
property for which the | ||||||
4 | taxpayer was required in any taxable year to make an
| ||||||
5 | addition modification under subparagraph (D-15), then | ||||||
6 | an amount equal to that
addition modification.
| ||||||
7 | If the taxpayer continues to own property through | ||||||
8 | the last day of the last tax year for which a | ||||||
9 | subtraction is allowed with respect to that property | ||||||
10 | under subparagraph (Z) and for which the taxpayer was | ||||||
11 | required in any taxable year to make an addition | ||||||
12 | modification under subparagraph (D-15), then an amount | ||||||
13 | equal to that addition modification.
| ||||||
14 | The taxpayer is allowed to take the deduction | ||||||
15 | under this subparagraph
only once with respect to any | ||||||
16 | one piece of property. | ||||||
17 | This subparagraph (AA) is exempt from the | ||||||
18 | provisions of Section 250; | ||||||
19 | (BB) Any amount included in adjusted gross income, | ||||||
20 | other
than
salary,
received by a driver in a | ||||||
21 | ridesharing arrangement using a motor vehicle; | ||||||
22 | (CC) The amount of (i) any interest income (net of | ||||||
23 | the deductions allocable thereto) taken into account | ||||||
24 | for the taxable year with respect to a transaction | ||||||
25 | with a taxpayer that is required to make an addition | ||||||
26 | modification with respect to such transaction under |
| |||||||
| |||||||
1 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
2 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
3 | the amount of that addition modification, and
(ii) any | ||||||
4 | income from intangible property (net of the deductions | ||||||
5 | allocable thereto) taken into account for the taxable | ||||||
6 | year with respect to a transaction with a taxpayer | ||||||
7 | that is required to make an addition modification with | ||||||
8 | respect to such transaction under Section | ||||||
9 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
10 | 203(d)(2)(D-8), but not to exceed the amount of that | ||||||
11 | addition modification. This subparagraph (CC) is | ||||||
12 | exempt from the provisions of Section 250; | ||||||
13 | (DD) An amount equal to the interest income taken | ||||||
14 | into account for the taxable year (net of the | ||||||
15 | deductions allocable thereto) with respect to | ||||||
16 | transactions with (i) a foreign person who would be a | ||||||
17 | member of the taxpayer's unitary business group but | ||||||
18 | for the fact that the foreign person's business | ||||||
19 | activity outside the United States is 80% or more of | ||||||
20 | that person's total business activity and (ii) for | ||||||
21 | taxable years ending on or after December 31, 2008, to | ||||||
22 | a person who would be a member of the same unitary | ||||||
23 | business group but for the fact that the person is | ||||||
24 | prohibited under Section 1501(a)(27) from being | ||||||
25 | included in the unitary business group because he or | ||||||
26 | she is ordinarily required to apportion business |
| |||||||
| |||||||
1 | income under different subsections of Section 304, but | ||||||
2 | not to exceed the addition modification required to be | ||||||
3 | made for the same taxable year under Section | ||||||
4 | 203(a)(2)(D-17) for interest paid, accrued, or | ||||||
5 | incurred, directly or indirectly, to the same person. | ||||||
6 | This subparagraph (DD) is exempt from the provisions | ||||||
7 | of Section 250; | ||||||
8 | (EE) An amount equal to the income from intangible | ||||||
9 | property taken into account for the taxable year (net | ||||||
10 | of the deductions allocable thereto) with respect to | ||||||
11 | transactions with (i) a foreign person who would be a | ||||||
12 | member of the taxpayer's unitary business group but | ||||||
13 | for the fact that the foreign person's business | ||||||
14 | activity outside the United States is 80% or more of | ||||||
15 | that person's total business activity and (ii) for | ||||||
16 | taxable years ending on or after December 31, 2008, to | ||||||
17 | a person who would be a member of the same unitary | ||||||
18 | business group but for the fact that the person is | ||||||
19 | prohibited under Section 1501(a)(27) from being | ||||||
20 | included in the unitary business group because he or | ||||||
21 | she is ordinarily required to apportion business | ||||||
22 | income under different subsections of Section 304, but | ||||||
23 | not to exceed the addition modification required to be | ||||||
24 | made for the same taxable year under Section | ||||||
25 | 203(a)(2)(D-18) for intangible expenses and costs | ||||||
26 | paid, accrued, or incurred, directly or indirectly, to |
| |||||||
| |||||||
1 | the same foreign person. This subparagraph (EE) is | ||||||
2 | exempt from the provisions of Section 250; | ||||||
3 | (FF) An amount equal to any amount awarded to the | ||||||
4 | taxpayer during the taxable year by the Court of | ||||||
5 | Claims under subsection (c) of Section 8 of the Court | ||||||
6 | of Claims Act for time unjustly served in a State | ||||||
7 | prison. This subparagraph (FF) is exempt from the | ||||||
8 | provisions of Section 250; | ||||||
9 | (GG) For taxable years ending on or after December | ||||||
10 | 31, 2011, in the case of a taxpayer who was required to | ||||||
11 | add back any insurance premiums under Section | ||||||
12 | 203(a)(2)(D-19), such taxpayer may elect to subtract | ||||||
13 | that part of a reimbursement received from the | ||||||
14 | insurance company equal to the amount of the expense | ||||||
15 | or loss (including expenses incurred by the insurance | ||||||
16 | company) that would have been taken into account as a | ||||||
17 | deduction for federal income tax purposes if the | ||||||
18 | expense or loss had been uninsured. If a taxpayer | ||||||
19 | makes the election provided for by this subparagraph | ||||||
20 | (GG), the insurer to which the premiums were paid must | ||||||
21 | add back to income the amount subtracted by the | ||||||
22 | taxpayer pursuant to this subparagraph (GG). This | ||||||
23 | subparagraph (GG) is exempt from the provisions of | ||||||
24 | Section 250; | ||||||
25 | (HH) For taxable years beginning on or after | ||||||
26 | January 1, 2018 and prior to January 1, 2028, a maximum |
| |||||||
| |||||||
1 | of $10,000 contributed in the taxable year to a | ||||||
2 | qualified ABLE account under Section 16.6 of the State | ||||||
3 | Treasurer Act, except that amounts excluded from gross | ||||||
4 | income under Section 529(c)(3)(C)(i) or Section | ||||||
5 | 529A(c)(1)(C) of the Internal Revenue Code shall not | ||||||
6 | be considered moneys contributed under this | ||||||
7 | subparagraph (HH). For purposes of this subparagraph | ||||||
8 | (HH), contributions made by an employer on behalf of | ||||||
9 | an employee, or matching contributions made by an | ||||||
10 | employee, shall be treated as made by the employee; | ||||||
11 | and | ||||||
12 | (II) For taxable years that begin on or after | ||||||
13 | January 1, 2021 and begin before January 1, 2026, the | ||||||
14 | amount that is included in the taxpayer's federal | ||||||
15 | adjusted gross income pursuant to Section 61 of the | ||||||
16 | Internal Revenue Code as discharge of indebtedness | ||||||
17 | attributable to student loan forgiveness and that is | ||||||
18 | not excluded from the taxpayer's federal adjusted | ||||||
19 | gross income pursuant to paragraph (5) of subsection | ||||||
20 | (f) of Section 108 of the Internal Revenue Code. | ||||||
21 | (b) Corporations. | ||||||
22 | (1) In general. In the case of a corporation, base | ||||||
23 | income means an
amount equal to the taxpayer's taxable | ||||||
24 | income for the taxable year as
modified by paragraph (2). | ||||||
25 | (2) Modifications. The taxable income referred to in |
| |||||||
| |||||||
1 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
2 | of the following amounts: | ||||||
3 | (A) An amount equal to all amounts paid or accrued | ||||||
4 | to the taxpayer
as interest and all distributions | ||||||
5 | received from regulated investment
companies during | ||||||
6 | the taxable year to the extent excluded from gross
| ||||||
7 | income in the computation of taxable income; | ||||||
8 | (B) An amount equal to the amount of tax imposed by | ||||||
9 | this Act to the
extent deducted from gross income in | ||||||
10 | the computation of taxable income
for the taxable | ||||||
11 | year; | ||||||
12 | (C) In the case of a regulated investment company, | ||||||
13 | an amount equal to
the excess of (i) the net long-term | ||||||
14 | capital gain for the taxable year, over
(ii) the | ||||||
15 | amount of the capital gain dividends designated as | ||||||
16 | such in accordance
with Section 852(b)(3)(C) of the | ||||||
17 | Internal Revenue Code and any amount
designated under | ||||||
18 | Section 852(b)(3)(D) of the Internal Revenue Code,
| ||||||
19 | attributable to the taxable year (this amendatory Act | ||||||
20 | of 1995
(Public Act 89-89) is declarative of existing | ||||||
21 | law and is not a new
enactment); | ||||||
22 | (D) The amount of any net operating loss deduction | ||||||
23 | taken in arriving
at taxable income, other than a net | ||||||
24 | operating loss carried forward from a
taxable year | ||||||
25 | ending prior to December 31, 1986; | ||||||
26 | (E) For taxable years in which a net operating |
| |||||||
| |||||||
1 | loss carryback or
carryforward from a taxable year | ||||||
2 | ending prior to December 31, 1986 is an
element of | ||||||
3 | taxable income under paragraph (1) of subsection (e) | ||||||
4 | or
subparagraph (E) of paragraph (2) of subsection | ||||||
5 | (e), the amount by which
addition modifications other | ||||||
6 | than those provided by this subparagraph (E)
exceeded | ||||||
7 | subtraction modifications in such earlier taxable | ||||||
8 | year, with the
following limitations applied in the | ||||||
9 | order that they are listed: | ||||||
10 | (i) the addition modification relating to the | ||||||
11 | net operating loss
carried back or forward to the | ||||||
12 | taxable year from any taxable year ending
prior to | ||||||
13 | December 31, 1986 shall be reduced by the amount | ||||||
14 | of addition
modification under this subparagraph | ||||||
15 | (E) which related to that net operating
loss and | ||||||
16 | which was taken into account in calculating the | ||||||
17 | base income of an
earlier taxable year, and | ||||||
18 | (ii) the addition modification relating to the | ||||||
19 | net operating loss
carried back or forward to the | ||||||
20 | taxable year from any taxable year ending
prior to | ||||||
21 | December 31, 1986 shall not exceed the amount of | ||||||
22 | such carryback or
carryforward; | ||||||
23 | For taxable years in which there is a net | ||||||
24 | operating loss carryback or
carryforward from more | ||||||
25 | than one other taxable year ending prior to December
| ||||||
26 | 31, 1986, the addition modification provided in this |
| |||||||
| |||||||
1 | subparagraph (E) shall
be the sum of the amounts | ||||||
2 | computed independently under the preceding
provisions | ||||||
3 | of this subparagraph (E) for each such taxable year; | ||||||
4 | (E-5) For taxable years ending after December 31, | ||||||
5 | 1997, an
amount equal to any eligible remediation | ||||||
6 | costs that the corporation
deducted in computing | ||||||
7 | adjusted gross income and for which the
corporation | ||||||
8 | claims a credit under subsection (l) of Section 201; | ||||||
9 | (E-10) For taxable years 2001 and thereafter, an | ||||||
10 | amount equal to the
bonus depreciation deduction taken | ||||||
11 | on the taxpayer's federal income tax return for the | ||||||
12 | taxable
year under subsection (k) of Section 168 of | ||||||
13 | the Internal Revenue Code; | ||||||
14 | (E-11) If the taxpayer sells, transfers, abandons, | ||||||
15 | or otherwise disposes of property for which the | ||||||
16 | taxpayer was required in any taxable year to
make an | ||||||
17 | addition modification under subparagraph (E-10), then | ||||||
18 | an amount equal
to the aggregate amount of the | ||||||
19 | deductions taken in all taxable
years under | ||||||
20 | subparagraph (T) with respect to that property. | ||||||
21 | If the taxpayer continues to own property through | ||||||
22 | the last day of the last tax year for which a | ||||||
23 | subtraction is allowed with respect to that property | ||||||
24 | under subparagraph (T) and for which the taxpayer was | ||||||
25 | allowed in any taxable year to make a subtraction | ||||||
26 | modification under subparagraph (T), then an amount |
| |||||||
| |||||||
1 | equal to that subtraction modification.
| ||||||
2 | The taxpayer is required to make the addition | ||||||
3 | modification under this
subparagraph
only once with | ||||||
4 | respect to any one piece of property; | ||||||
5 | (E-12) An amount equal to the amount otherwise | ||||||
6 | allowed as a deduction in computing base income for | ||||||
7 | interest paid, accrued, or incurred, directly or | ||||||
8 | indirectly, (i) for taxable years ending on or after | ||||||
9 | December 31, 2004, to a foreign person who would be a | ||||||
10 | member of the same unitary business group but for the | ||||||
11 | fact the foreign person's business activity outside | ||||||
12 | the United States is 80% or more of the foreign | ||||||
13 | person's total business activity and (ii) for taxable | ||||||
14 | years ending on or after December 31, 2008, to a person | ||||||
15 | who would be a member of the same unitary business | ||||||
16 | group but for the fact that the person is prohibited | ||||||
17 | under Section 1501(a)(27) from being included in the | ||||||
18 | unitary business group because he or she is ordinarily | ||||||
19 | required to apportion business income under different | ||||||
20 | subsections of Section 304. The addition modification | ||||||
21 | required by this subparagraph shall be reduced to the | ||||||
22 | extent that dividends were included in base income of | ||||||
23 | the unitary group for the same taxable year and | ||||||
24 | received by the taxpayer or by a member of the | ||||||
25 | taxpayer's unitary business group (including amounts | ||||||
26 | included in gross income pursuant to Sections 951 |
| |||||||
| |||||||
1 | through 964 of the Internal Revenue Code and amounts | ||||||
2 | included in gross income under Section 78 of the | ||||||
3 | Internal Revenue Code) with respect to the stock of | ||||||
4 | the same person to whom the interest was paid, | ||||||
5 | accrued, or incurred.
| ||||||
6 | This paragraph shall not apply to the following:
| ||||||
7 | (i) an item of interest paid, accrued, or | ||||||
8 | incurred, directly or indirectly, to a person who | ||||||
9 | is subject in a foreign country or state, other | ||||||
10 | than a state which requires mandatory unitary | ||||||
11 | reporting, to a tax on or measured by net income | ||||||
12 | with respect to such interest; or | ||||||
13 | (ii) an item of interest paid, accrued, or | ||||||
14 | incurred, directly or indirectly, to a person if | ||||||
15 | the taxpayer can establish, based on a | ||||||
16 | preponderance of the evidence, both of the | ||||||
17 | following: | ||||||
18 | (a) the person, during the same taxable | ||||||
19 | year, paid, accrued, or incurred, the interest | ||||||
20 | to a person that is not a related member, and | ||||||
21 | (b) the transaction giving rise to the | ||||||
22 | interest expense between the taxpayer and the | ||||||
23 | person did not have as a principal purpose the | ||||||
24 | avoidance of Illinois income tax, and is paid | ||||||
25 | pursuant to a contract or agreement that | ||||||
26 | reflects an arm's-length interest rate and |
| |||||||
| |||||||
1 | terms; or
| ||||||
2 | (iii) the taxpayer can establish, based on | ||||||
3 | clear and convincing evidence, that the interest | ||||||
4 | paid, accrued, or incurred relates to a contract | ||||||
5 | or agreement entered into at arm's-length rates | ||||||
6 | and terms and the principal purpose for the | ||||||
7 | payment is not federal or Illinois tax avoidance; | ||||||
8 | or
| ||||||
9 | (iv) an item of interest paid, accrued, or | ||||||
10 | incurred, directly or indirectly, to a person if | ||||||
11 | the taxpayer establishes by clear and convincing | ||||||
12 | evidence that the adjustments are unreasonable; or | ||||||
13 | if the taxpayer and the Director agree in writing | ||||||
14 | to the application or use of an alternative method | ||||||
15 | of apportionment under Section 304(f).
| ||||||
16 | Nothing in this subsection shall preclude the | ||||||
17 | Director from making any other adjustment | ||||||
18 | otherwise allowed under Section 404 of this Act | ||||||
19 | for any tax year beginning after the effective | ||||||
20 | date of this amendment provided such adjustment is | ||||||
21 | made pursuant to regulation adopted by the | ||||||
22 | Department and such regulations provide methods | ||||||
23 | and standards by which the Department will utilize | ||||||
24 | its authority under Section 404 of this Act;
| ||||||
25 | (E-13) An amount equal to the amount of intangible | ||||||
26 | expenses and costs otherwise allowed as a deduction in |
| |||||||
| |||||||
1 | computing base income, and that were paid, accrued, or | ||||||
2 | incurred, directly or indirectly, (i) for taxable | ||||||
3 | years ending on or after December 31, 2004, to a | ||||||
4 | foreign person who would be a member of the same | ||||||
5 | unitary business group but for the fact that the | ||||||
6 | foreign person's business activity outside the United | ||||||
7 | States is 80% or more of that person's total business | ||||||
8 | activity and (ii) for taxable years ending on or after | ||||||
9 | December 31, 2008, to a person who would be a member of | ||||||
10 | the same unitary business group but for the fact that | ||||||
11 | the person is prohibited under Section 1501(a)(27) | ||||||
12 | from being included in the unitary business group | ||||||
13 | because he or she is ordinarily required to apportion | ||||||
14 | business income under different subsections of Section | ||||||
15 | 304. The addition modification required by this | ||||||
16 | subparagraph shall be reduced to the extent that | ||||||
17 | dividends were included in base income of the unitary | ||||||
18 | group for the same taxable year and received by the | ||||||
19 | taxpayer or by a member of the taxpayer's unitary | ||||||
20 | business group (including amounts included in gross | ||||||
21 | income pursuant to Sections 951 through 964 of the | ||||||
22 | Internal Revenue Code and amounts included in gross | ||||||
23 | income under Section 78 of the Internal Revenue Code) | ||||||
24 | with respect to the stock of the same person to whom | ||||||
25 | the intangible expenses and costs were directly or | ||||||
26 | indirectly paid, incurred, or accrued. The preceding |
| |||||||
| |||||||
1 | sentence shall not apply to the extent that the same | ||||||
2 | dividends caused a reduction to the addition | ||||||
3 | modification required under Section 203(b)(2)(E-12) of | ||||||
4 | this Act.
As used in this subparagraph, the term | ||||||
5 | "intangible expenses and costs" includes (1) expenses, | ||||||
6 | losses, and costs for, or related to, the direct or | ||||||
7 | indirect acquisition, use, maintenance or management, | ||||||
8 | ownership, sale, exchange, or any other disposition of | ||||||
9 | intangible property; (2) losses incurred, directly or | ||||||
10 | indirectly, from factoring transactions or discounting | ||||||
11 | transactions; (3) royalty, patent, technical, and | ||||||
12 | copyright fees; (4) licensing fees; and (5) other | ||||||
13 | similar expenses and costs.
For purposes of this | ||||||
14 | subparagraph, "intangible property" includes patents, | ||||||
15 | patent applications, trade names, trademarks, service | ||||||
16 | marks, copyrights, mask works, trade secrets, and | ||||||
17 | similar types of intangible assets. | ||||||
18 | This paragraph shall not apply to the following: | ||||||
19 | (i) any item of intangible expenses or costs | ||||||
20 | paid, accrued, or incurred, directly or | ||||||
21 | indirectly, from a transaction with a person who | ||||||
22 | is subject in a foreign country or state, other | ||||||
23 | than a state which requires mandatory unitary | ||||||
24 | reporting, to a tax on or measured by net income | ||||||
25 | with respect to such item; or | ||||||
26 | (ii) any item of intangible expense or cost |
| |||||||
| |||||||
1 | paid, accrued, or incurred, directly or | ||||||
2 | indirectly, if the taxpayer can establish, based | ||||||
3 | on a preponderance of the evidence, both of the | ||||||
4 | following: | ||||||
5 | (a) the person during the same taxable | ||||||
6 | year paid, accrued, or incurred, the | ||||||
7 | intangible expense or cost to a person that is | ||||||
8 | not a related member, and | ||||||
9 | (b) the transaction giving rise to the | ||||||
10 | intangible expense or cost between the | ||||||
11 | taxpayer and the person did not have as a | ||||||
12 | principal purpose the avoidance of Illinois | ||||||
13 | income tax, and is paid pursuant to a contract | ||||||
14 | or agreement that reflects arm's-length terms; | ||||||
15 | or | ||||||
16 | (iii) any item of intangible expense or cost | ||||||
17 | paid, accrued, or incurred, directly or | ||||||
18 | indirectly, from a transaction with a person if | ||||||
19 | the taxpayer establishes by clear and convincing | ||||||
20 | evidence, that the adjustments are unreasonable; | ||||||
21 | or if the taxpayer and the Director agree in | ||||||
22 | writing to the application or use of an | ||||||
23 | alternative method of apportionment under Section | ||||||
24 | 304(f);
| ||||||
25 | Nothing in this subsection shall preclude the | ||||||
26 | Director from making any other adjustment |
| |||||||
| |||||||
1 | otherwise allowed under Section 404 of this Act | ||||||
2 | for any tax year beginning after the effective | ||||||
3 | date of this amendment provided such adjustment is | ||||||
4 | made pursuant to regulation adopted by the | ||||||
5 | Department and such regulations provide methods | ||||||
6 | and standards by which the Department will utilize | ||||||
7 | its authority under Section 404 of this Act;
| ||||||
8 | (E-14) For taxable years ending on or after | ||||||
9 | December 31, 2008, an amount equal to the amount of | ||||||
10 | insurance premium expenses and costs otherwise allowed | ||||||
11 | as a deduction in computing base income, and that were | ||||||
12 | paid, accrued, or incurred, directly or indirectly, to | ||||||
13 | a person who would be a member of the same unitary | ||||||
14 | business group but for the fact that the person is | ||||||
15 | prohibited under Section 1501(a)(27) from being | ||||||
16 | included in the unitary business group because he or | ||||||
17 | she is ordinarily required to apportion business | ||||||
18 | income under different subsections of Section 304. The | ||||||
19 | addition modification required by this subparagraph | ||||||
20 | shall be reduced to the extent that dividends were | ||||||
21 | included in base income of the unitary group for the | ||||||
22 | same taxable year and received by the taxpayer or by a | ||||||
23 | member of the taxpayer's unitary business group | ||||||
24 | (including amounts included in gross income under | ||||||
25 | Sections 951 through 964 of the Internal Revenue Code | ||||||
26 | and amounts included in gross income under Section 78 |
| |||||||
| |||||||
1 | of the Internal Revenue Code) with respect to the | ||||||
2 | stock of the same person to whom the premiums and costs | ||||||
3 | were directly or indirectly paid, incurred, or | ||||||
4 | accrued. The preceding sentence does not apply to the | ||||||
5 | extent that the same dividends caused a reduction to | ||||||
6 | the addition modification required under Section | ||||||
7 | 203(b)(2)(E-12) or Section 203(b)(2)(E-13) of this | ||||||
8 | Act;
| ||||||
9 | (E-15) For taxable years beginning after December | ||||||
10 | 31, 2008, any deduction for dividends paid by a | ||||||
11 | captive real estate investment trust that is allowed | ||||||
12 | to a real estate investment trust under Section | ||||||
13 | 857(b)(2)(B) of the Internal Revenue Code for | ||||||
14 | dividends paid; | ||||||
15 | (E-16) An amount equal to the credit allowable to | ||||||
16 | the taxpayer under Section 218(a) of this Act, | ||||||
17 | determined without regard to Section 218(c) of this | ||||||
18 | Act; | ||||||
19 | (E-17) For taxable years ending on or after | ||||||
20 | December 31, 2017, an amount equal to the deduction | ||||||
21 | allowed under Section 199 of the Internal Revenue Code | ||||||
22 | for the taxable year; | ||||||
23 | (E-18) for taxable years beginning after December | ||||||
24 | 31, 2018, an amount equal to the deduction allowed | ||||||
25 | under Section 250(a)(1)(A) of the Internal Revenue | ||||||
26 | Code for the taxable year; |
| |||||||
| |||||||
1 | (E-19) for taxable years ending on or after June | ||||||
2 | 30, 2021, an amount equal to the deduction allowed | ||||||
3 | under Section 250(a)(1)(B)(i) of the Internal Revenue | ||||||
4 | Code for the taxable year; | ||||||
5 | (E-20) for taxable years ending on or after June | ||||||
6 | 30, 2021, an amount equal to the deduction allowed | ||||||
7 | under Sections 243(e) and 245A(a) of the Internal | ||||||
8 | Revenue Code for the taxable year ; and . | ||||||
9 | (E-21) the amount that is claimed as a federal | ||||||
10 | deduction when computing the taxpayer's federal | ||||||
11 | taxable income for the taxable year and that is | ||||||
12 | attributable to an endowment gift for which the | ||||||
13 | taxpayer receives a credit under the Endow Illinois | ||||||
14 | Tax Credit Act; | ||||||
15 | and by deducting from the total so obtained the sum of the | ||||||
16 | following
amounts: | ||||||
17 | (F) An amount equal to the amount of any tax | ||||||
18 | imposed by this Act
which was refunded to the taxpayer | ||||||
19 | and included in such total for the
taxable year; | ||||||
20 | (G) An amount equal to any amount included in such | ||||||
21 | total under
Section 78 of the Internal Revenue Code; | ||||||
22 | (H) In the case of a regulated investment company, | ||||||
23 | an amount equal
to the amount of exempt interest | ||||||
24 | dividends as defined in subsection (b)(5) of Section | ||||||
25 | 852 of the Internal Revenue Code, paid to shareholders
| ||||||
26 | for the taxable year; |
| |||||||
| |||||||
1 | (I) With the exception of any amounts subtracted | ||||||
2 | under subparagraph
(J),
an amount equal to the sum of | ||||||
3 | all amounts disallowed as
deductions by (i) Sections | ||||||
4 | 171(a)(2) and 265(a)(2) and amounts disallowed as
| ||||||
5 | interest expense by Section 291(a)(3) of the Internal | ||||||
6 | Revenue Code, and all amounts of expenses allocable to | ||||||
7 | interest and
disallowed as deductions by Section | ||||||
8 | 265(a)(1) of the Internal Revenue Code;
and (ii) for | ||||||
9 | taxable years
ending on or after August 13, 1999, | ||||||
10 | Sections
171(a)(2), 265,
280C, 291(a)(3), and | ||||||
11 | 832(b)(5)(B)(i) of the Internal Revenue Code, plus, | ||||||
12 | for tax years ending on or after December 31, 2011, | ||||||
13 | amounts disallowed as deductions by Section 45G(e)(3) | ||||||
14 | of the Internal Revenue Code and, for taxable years | ||||||
15 | ending on or after December 31, 2008, any amount | ||||||
16 | included in gross income under Section 87 of the | ||||||
17 | Internal Revenue Code and the policyholders' share of | ||||||
18 | tax-exempt interest of a life insurance company under | ||||||
19 | Section 807(a)(2)(B) of the Internal Revenue Code (in | ||||||
20 | the case of a life insurance company with gross income | ||||||
21 | from a decrease in reserves for the tax year) or | ||||||
22 | Section 807(b)(1)(B) of the Internal Revenue Code (in | ||||||
23 | the case of a life insurance company allowed a | ||||||
24 | deduction for an increase in reserves for the tax | ||||||
25 | year); the
provisions of this
subparagraph are exempt | ||||||
26 | from the provisions of Section 250; |
| |||||||
| |||||||
1 | (J) An amount equal to all amounts included in | ||||||
2 | such total which are
exempt from taxation by this | ||||||
3 | State either by reason of its statutes or
Constitution
| ||||||
4 | or by reason of the Constitution, treaties or statutes | ||||||
5 | of the United States;
provided that, in the case of any | ||||||
6 | statute of this State that exempts income
derived from | ||||||
7 | bonds or other obligations from the tax imposed under | ||||||
8 | this Act,
the amount exempted shall be the interest | ||||||
9 | net of bond premium amortization; | ||||||
10 | (K) An amount equal to those dividends included in | ||||||
11 | such total
which were paid by a corporation which | ||||||
12 | conducts
business operations in a River Edge | ||||||
13 | Redevelopment Zone or zones created under the River | ||||||
14 | Edge Redevelopment Zone Act and conducts substantially | ||||||
15 | all of its
operations in a River Edge Redevelopment | ||||||
16 | Zone or zones. This subparagraph (K) is exempt from | ||||||
17 | the provisions of Section 250; | ||||||
18 | (L) An amount equal to those dividends included in | ||||||
19 | such total that
were paid by a corporation that | ||||||
20 | conducts business operations in a federally
designated | ||||||
21 | Foreign Trade Zone or Sub-Zone and that is designated | ||||||
22 | a High Impact
Business located in Illinois; provided | ||||||
23 | that dividends eligible for the
deduction provided in | ||||||
24 | subparagraph (K) of paragraph 2 of this subsection
| ||||||
25 | shall not be eligible for the deduction provided under | ||||||
26 | this subparagraph
(L); |
| |||||||
| |||||||
1 | (M) For any taxpayer that is a financial | ||||||
2 | organization within the meaning
of Section 304(c) of | ||||||
3 | this Act, an amount included in such total as interest
| ||||||
4 | income from a loan or loans made by such taxpayer to a | ||||||
5 | borrower, to the extent
that such a loan is secured by | ||||||
6 | property which is eligible for the River Edge | ||||||
7 | Redevelopment Zone Investment Credit. To determine the | ||||||
8 | portion of a loan or loans that is
secured by property | ||||||
9 | eligible for a Section 201(f) investment
credit to the | ||||||
10 | borrower, the entire principal amount of the loan or | ||||||
11 | loans
between the taxpayer and the borrower should be | ||||||
12 | divided into the basis of the
Section 201(f) | ||||||
13 | investment credit property which secures the
loan or | ||||||
14 | loans, using for this purpose the original basis of | ||||||
15 | such property on
the date that it was placed in service | ||||||
16 | in the River Edge Redevelopment Zone. The subtraction | ||||||
17 | modification available to the taxpayer in any
year | ||||||
18 | under this subsection shall be that portion of the | ||||||
19 | total interest paid
by the borrower with respect to | ||||||
20 | such loan attributable to the eligible
property as | ||||||
21 | calculated under the previous sentence. This | ||||||
22 | subparagraph (M) is exempt from the provisions of | ||||||
23 | Section 250; | ||||||
24 | (M-1) For any taxpayer that is a financial | ||||||
25 | organization within the
meaning of Section 304(c) of | ||||||
26 | this Act, an amount included in such total as
interest |
| |||||||
| |||||||
1 | income from a loan or loans made by such taxpayer to a | ||||||
2 | borrower,
to the extent that such a loan is secured by | ||||||
3 | property which is eligible for
the High Impact | ||||||
4 | Business Investment Credit. To determine the portion | ||||||
5 | of a
loan or loans that is secured by property eligible | ||||||
6 | for a Section 201(h) investment credit to the | ||||||
7 | borrower, the entire principal amount of
the loan or | ||||||
8 | loans between the taxpayer and the borrower should be | ||||||
9 | divided into
the basis of the Section 201(h) | ||||||
10 | investment credit property which
secures the loan or | ||||||
11 | loans, using for this purpose the original basis of | ||||||
12 | such
property on the date that it was placed in service | ||||||
13 | in a federally designated
Foreign Trade Zone or | ||||||
14 | Sub-Zone located in Illinois. No taxpayer that is
| ||||||
15 | eligible for the deduction provided in subparagraph | ||||||
16 | (M) of paragraph (2) of
this subsection shall be | ||||||
17 | eligible for the deduction provided under this
| ||||||
18 | subparagraph (M-1). The subtraction modification | ||||||
19 | available to taxpayers in
any year under this | ||||||
20 | subsection shall be that portion of the total interest
| ||||||
21 | paid by the borrower with respect to such loan | ||||||
22 | attributable to the eligible
property as calculated | ||||||
23 | under the previous sentence; | ||||||
24 | (N) Two times any contribution made during the | ||||||
25 | taxable year to a
designated zone organization to the | ||||||
26 | extent that the contribution (i)
qualifies as a |
| |||||||
| |||||||
1 | charitable contribution under subsection (c) of | ||||||
2 | Section 170
of the Internal Revenue Code and (ii) | ||||||
3 | must, by its terms, be used for a
project approved by | ||||||
4 | the Department of Commerce and Economic Opportunity | ||||||
5 | under Section 11 of the Illinois Enterprise Zone Act | ||||||
6 | or under Section 10-10 of the River Edge Redevelopment | ||||||
7 | Zone Act. This subparagraph (N) is exempt from the | ||||||
8 | provisions of Section 250; | ||||||
9 | (O) An amount equal to: (i) 85% for taxable years | ||||||
10 | ending on or before
December 31, 1992, or, a | ||||||
11 | percentage equal to the percentage allowable under
| ||||||
12 | Section 243(a)(1) of the Internal Revenue Code of 1986 | ||||||
13 | for taxable years ending
after December 31, 1992, of | ||||||
14 | the amount by which dividends included in taxable
| ||||||
15 | income and received from a corporation that is not | ||||||
16 | created or organized under
the laws of the United | ||||||
17 | States or any state or political subdivision thereof,
| ||||||
18 | including, for taxable years ending on or after | ||||||
19 | December 31, 1988, dividends
received or deemed | ||||||
20 | received or paid or deemed paid under Sections 951 | ||||||
21 | through
965 of the Internal Revenue Code, exceed the | ||||||
22 | amount of the modification
provided under subparagraph | ||||||
23 | (G) of paragraph (2) of this subsection (b) which
is | ||||||
24 | related to such dividends, and including, for taxable | ||||||
25 | years ending on or after December 31, 2008, dividends | ||||||
26 | received from a captive real estate investment trust; |
| |||||||
| |||||||
1 | plus (ii) 100% of the amount by which dividends,
| ||||||
2 | included in taxable income and received, including, | ||||||
3 | for taxable years ending on
or after December 31, | ||||||
4 | 1988, dividends received or deemed received or paid or
| ||||||
5 | deemed paid under Sections 951 through 964 of the | ||||||
6 | Internal Revenue Code and including, for taxable years | ||||||
7 | ending on or after December 31, 2008, dividends | ||||||
8 | received from a captive real estate investment trust, | ||||||
9 | from
any such corporation specified in clause (i) that | ||||||
10 | would but for the provisions
of Section 1504(b)(3) of | ||||||
11 | the Internal Revenue Code be treated as a member of
the | ||||||
12 | affiliated group which includes the dividend | ||||||
13 | recipient, exceed the amount
of the modification | ||||||
14 | provided under subparagraph (G) of paragraph (2) of | ||||||
15 | this
subsection (b) which is related to such | ||||||
16 | dividends. For taxable years ending on or after June | ||||||
17 | 30, 2021, (i) for purposes of this subparagraph, the | ||||||
18 | term "dividend" does not include any amount treated as | ||||||
19 | a dividend under Section 1248 of the Internal Revenue | ||||||
20 | Code, and (ii) this subparagraph shall not apply to | ||||||
21 | dividends for which a deduction is allowed under | ||||||
22 | Section 245(a) of the Internal Revenue Code. This | ||||||
23 | subparagraph (O) is exempt from the provisions of | ||||||
24 | Section 250 of this Act; | ||||||
25 | (P) An amount equal to any contribution made to a | ||||||
26 | job training project
established pursuant to the Tax |
| |||||||
| |||||||
1 | Increment Allocation Redevelopment Act; | ||||||
2 | (Q) An amount equal to the amount of the deduction | ||||||
3 | used to compute the
federal income tax credit for | ||||||
4 | restoration of substantial amounts held under
claim of | ||||||
5 | right for the taxable year pursuant to Section 1341 of | ||||||
6 | the
Internal Revenue Code; | ||||||
7 | (R) On and after July 20, 1999, in the case of an | ||||||
8 | attorney-in-fact with respect to whom an
interinsurer | ||||||
9 | or a reciprocal insurer has made the election under | ||||||
10 | Section 835 of
the Internal Revenue Code, 26 U.S.C. | ||||||
11 | 835, an amount equal to the excess, if
any, of the | ||||||
12 | amounts paid or incurred by that interinsurer or | ||||||
13 | reciprocal insurer
in the taxable year to the | ||||||
14 | attorney-in-fact over the deduction allowed to that
| ||||||
15 | interinsurer or reciprocal insurer with respect to the | ||||||
16 | attorney-in-fact under
Section 835(b) of the Internal | ||||||
17 | Revenue Code for the taxable year; the provisions of | ||||||
18 | this subparagraph are exempt from the provisions of | ||||||
19 | Section 250; | ||||||
20 | (S) For taxable years ending on or after December | ||||||
21 | 31, 1997, in the
case of a Subchapter
S corporation, an | ||||||
22 | amount equal to all amounts of income allocable to a
| ||||||
23 | shareholder subject to the Personal Property Tax | ||||||
24 | Replacement Income Tax imposed
by subsections (c) and | ||||||
25 | (d) of Section 201 of this Act, including amounts
| ||||||
26 | allocable to organizations exempt from federal income |
| |||||||
| |||||||
1 | tax by reason of Section
501(a) of the Internal | ||||||
2 | Revenue Code. This subparagraph (S) is exempt from
the | ||||||
3 | provisions of Section 250; | ||||||
4 | (T) For taxable years 2001 and thereafter, for the | ||||||
5 | taxable year in
which the bonus depreciation deduction
| ||||||
6 | is taken on the taxpayer's federal income tax return | ||||||
7 | under
subsection (k) of Section 168 of the Internal | ||||||
8 | Revenue Code and for each
applicable taxable year | ||||||
9 | thereafter, an amount equal to "x", where: | ||||||
10 | (1) "y" equals the amount of the depreciation | ||||||
11 | deduction taken for the
taxable year
on the | ||||||
12 | taxpayer's federal income tax return on property | ||||||
13 | for which the bonus
depreciation deduction
was | ||||||
14 | taken in any year under subsection (k) of Section | ||||||
15 | 168 of the Internal
Revenue Code, but not | ||||||
16 | including the bonus depreciation deduction; | ||||||
17 | (2) for taxable years ending on or before | ||||||
18 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
19 | and then divided by 70 (or "y"
multiplied by | ||||||
20 | 0.429); and | ||||||
21 | (3) for taxable years ending after December | ||||||
22 | 31, 2005: | ||||||
23 | (i) for property on which a bonus | ||||||
24 | depreciation deduction of 30% of the adjusted | ||||||
25 | basis was taken, "x" equals "y" multiplied by | ||||||
26 | 30 and then divided by 70 (or "y"
multiplied |
| |||||||
| |||||||
1 | by 0.429); | ||||||
2 | (ii) for property on which a bonus | ||||||
3 | depreciation deduction of 50% of the adjusted | ||||||
4 | basis was taken, "x" equals "y" multiplied by | ||||||
5 | 1.0; | ||||||
6 | (iii) for property on which a bonus | ||||||
7 | depreciation deduction of 100% of the adjusted | ||||||
8 | basis was taken in a taxable year ending on or | ||||||
9 | after December 31, 2021, "x" equals the | ||||||
10 | depreciation deduction that would be allowed | ||||||
11 | on that property if the taxpayer had made the | ||||||
12 | election under Section 168(k)(7) of the | ||||||
13 | Internal Revenue Code to not claim bonus | ||||||
14 | depreciation on that property; and | ||||||
15 | (iv) for property on which a bonus | ||||||
16 | depreciation deduction of a percentage other | ||||||
17 | than 30%, 50% or 100% of the adjusted basis | ||||||
18 | was taken in a taxable year ending on or after | ||||||
19 | December 31, 2021, "x" equals "y" multiplied | ||||||
20 | by 100 times the percentage bonus depreciation | ||||||
21 | on the property (that is, 100(bonus%)) and | ||||||
22 | then divided by 100 times 1 minus the | ||||||
23 | percentage bonus depreciation on the property | ||||||
24 | (that is, 100(1–bonus%)). | ||||||
25 | The aggregate amount deducted under this | ||||||
26 | subparagraph in all taxable
years for any one piece of |
| |||||||
| |||||||
1 | property may not exceed the amount of the bonus
| ||||||
2 | depreciation deduction
taken on that property on the | ||||||
3 | taxpayer's federal income tax return under
subsection | ||||||
4 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
5 | subparagraph (T) is exempt from the provisions of | ||||||
6 | Section 250; | ||||||
7 | (U) If the taxpayer sells, transfers, abandons, or | ||||||
8 | otherwise disposes of
property for which the taxpayer | ||||||
9 | was required in any taxable year to make an
addition | ||||||
10 | modification under subparagraph (E-10), then an amount | ||||||
11 | equal to that
addition modification. | ||||||
12 | If the taxpayer continues to own property through | ||||||
13 | the last day of the last tax year for which a | ||||||
14 | subtraction is allowed with respect to that property | ||||||
15 | under subparagraph (T) and for which the taxpayer was | ||||||
16 | required in any taxable year to make an addition | ||||||
17 | modification under subparagraph (E-10), then an amount | ||||||
18 | equal to that addition modification.
| ||||||
19 | The taxpayer is allowed to take the deduction | ||||||
20 | under this subparagraph
only once with respect to any | ||||||
21 | one piece of property. | ||||||
22 | This subparagraph (U) is exempt from the | ||||||
23 | provisions of Section 250; | ||||||
24 | (V) The amount of: (i) any interest income (net of | ||||||
25 | the deductions allocable thereto) taken into account | ||||||
26 | for the taxable year with respect to a transaction |
| |||||||
| |||||||
1 | with a taxpayer that is required to make an addition | ||||||
2 | modification with respect to such transaction under | ||||||
3 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
4 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
5 | the amount of such addition modification,
(ii) any | ||||||
6 | income from intangible property (net of the deductions | ||||||
7 | allocable thereto) taken into account for the taxable | ||||||
8 | year with respect to a transaction with a taxpayer | ||||||
9 | that is required to make an addition modification with | ||||||
10 | respect to such transaction under Section | ||||||
11 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
12 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
13 | addition modification, and (iii) any insurance premium | ||||||
14 | income (net of deductions allocable thereto) taken | ||||||
15 | into account for the taxable year with respect to a | ||||||
16 | transaction with a taxpayer that is required to make | ||||||
17 | an addition modification with respect to such | ||||||
18 | transaction under Section 203(a)(2)(D-19), Section | ||||||
19 | 203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section | ||||||
20 | 203(d)(2)(D-9), but not to exceed the amount of that | ||||||
21 | addition modification. This subparagraph (V) is exempt | ||||||
22 | from the provisions of Section 250;
| ||||||
23 | (W) An amount equal to the interest income taken | ||||||
24 | into account for the taxable year (net of the | ||||||
25 | deductions allocable thereto) with respect to | ||||||
26 | transactions with (i) a foreign person who would be a |
| |||||||
| |||||||
1 | member of the taxpayer's unitary business group but | ||||||
2 | for the fact that the foreign person's business | ||||||
3 | activity outside the United States is 80% or more of | ||||||
4 | that person's total business activity and (ii) for | ||||||
5 | taxable years ending on or after December 31, 2008, to | ||||||
6 | a person who would be a member of the same unitary | ||||||
7 | business group but for the fact that the person is | ||||||
8 | prohibited under Section 1501(a)(27) from being | ||||||
9 | included in the unitary business group because he or | ||||||
10 | she is ordinarily required to apportion business | ||||||
11 | income under different subsections of Section 304, but | ||||||
12 | not to exceed the addition modification required to be | ||||||
13 | made for the same taxable year under Section | ||||||
14 | 203(b)(2)(E-12) for interest paid, accrued, or | ||||||
15 | incurred, directly or indirectly, to the same person. | ||||||
16 | This subparagraph (W) is exempt from the provisions of | ||||||
17 | Section 250;
| ||||||
18 | (X) An amount equal to the income from intangible | ||||||
19 | property taken into account for the taxable year (net | ||||||
20 | of the deductions allocable thereto) with respect to | ||||||
21 | transactions with (i) a foreign person who would be a | ||||||
22 | member of the taxpayer's unitary business group but | ||||||
23 | for the fact that the foreign person's business | ||||||
24 | activity outside the United States is 80% or more of | ||||||
25 | that person's total business activity and (ii) for | ||||||
26 | taxable years ending on or after December 31, 2008, to |
| |||||||
| |||||||
1 | a person who would be a member of the same unitary | ||||||
2 | business group but for the fact that the person is | ||||||
3 | prohibited under Section 1501(a)(27) from being | ||||||
4 | included in the unitary business group because he or | ||||||
5 | she is ordinarily required to apportion business | ||||||
6 | income under different subsections of Section 304, but | ||||||
7 | not to exceed the addition modification required to be | ||||||
8 | made for the same taxable year under Section | ||||||
9 | 203(b)(2)(E-13) for intangible expenses and costs | ||||||
10 | paid, accrued, or incurred, directly or indirectly, to | ||||||
11 | the same foreign person. This subparagraph (X) is | ||||||
12 | exempt from the provisions of Section 250;
| ||||||
13 | (Y) For taxable years ending on or after December | ||||||
14 | 31, 2011, in the case of a taxpayer who was required to | ||||||
15 | add back any insurance premiums under Section | ||||||
16 | 203(b)(2)(E-14), such taxpayer may elect to subtract | ||||||
17 | that part of a reimbursement received from the | ||||||
18 | insurance company equal to the amount of the expense | ||||||
19 | or loss (including expenses incurred by the insurance | ||||||
20 | company) that would have been taken into account as a | ||||||
21 | deduction for federal income tax purposes if the | ||||||
22 | expense or loss had been uninsured. If a taxpayer | ||||||
23 | makes the election provided for by this subparagraph | ||||||
24 | (Y), the insurer to which the premiums were paid must | ||||||
25 | add back to income the amount subtracted by the | ||||||
26 | taxpayer pursuant to this subparagraph (Y). This |
| |||||||
| |||||||
1 | subparagraph (Y) is exempt from the provisions of | ||||||
2 | Section 250; and | ||||||
3 | (Z) The difference between the nondeductible | ||||||
4 | controlled foreign corporation dividends under Section | ||||||
5 | 965(e)(3) of the Internal Revenue Code over the | ||||||
6 | taxable income of the taxpayer, computed without | ||||||
7 | regard to Section 965(e)(2)(A) of the Internal Revenue | ||||||
8 | Code, and without regard to any net operating loss | ||||||
9 | deduction. This subparagraph (Z) is exempt from the | ||||||
10 | provisions of Section 250. | ||||||
11 | (3) Special rule. For purposes of paragraph (2)(A), | ||||||
12 | "gross income"
in the case of a life insurance company, | ||||||
13 | for tax years ending on and after
December 31, 1994,
and | ||||||
14 | prior to December 31, 2011, shall mean the gross | ||||||
15 | investment income for the taxable year and, for tax years | ||||||
16 | ending on or after December 31, 2011, shall mean all | ||||||
17 | amounts included in life insurance gross income under | ||||||
18 | Section 803(a)(3) of the Internal Revenue Code. | ||||||
19 | (c) Trusts and estates. | ||||||
20 | (1) In general. In the case of a trust or estate, base | ||||||
21 | income means
an amount equal to the taxpayer's taxable | ||||||
22 | income for the taxable year as
modified by paragraph (2). | ||||||
23 | (2) Modifications. Subject to the provisions of | ||||||
24 | paragraph (3), the
taxable income referred to in paragraph | ||||||
25 | (1) shall be modified by adding
thereto the sum of the |
| |||||||
| |||||||
1 | following amounts: | ||||||
2 | (A) An amount equal to all amounts paid or accrued | ||||||
3 | to the taxpayer
as interest or dividends during the | ||||||
4 | taxable year to the extent excluded
from gross income | ||||||
5 | in the computation of taxable income; | ||||||
6 | (B) In the case of (i) an estate, $600; (ii) a | ||||||
7 | trust which, under
its governing instrument, is | ||||||
8 | required to distribute all of its income
currently, | ||||||
9 | $300; and (iii) any other trust, $100, but in each such | ||||||
10 | case,
only to the extent such amount was deducted in | ||||||
11 | the computation of
taxable income; | ||||||
12 | (C) An amount equal to the amount of tax imposed by | ||||||
13 | this Act to the
extent deducted from gross income in | ||||||
14 | the computation of taxable income
for the taxable | ||||||
15 | year; | ||||||
16 | (D) The amount of any net operating loss deduction | ||||||
17 | taken in arriving at
taxable income, other than a net | ||||||
18 | operating loss carried forward from a
taxable year | ||||||
19 | ending prior to December 31, 1986; | ||||||
20 | (E) For taxable years in which a net operating | ||||||
21 | loss carryback or
carryforward from a taxable year | ||||||
22 | ending prior to December 31, 1986 is an
element of | ||||||
23 | taxable income under paragraph (1) of subsection (e) | ||||||
24 | or subparagraph
(E) of paragraph (2) of subsection | ||||||
25 | (e), the amount by which addition
modifications other | ||||||
26 | than those provided by this subparagraph (E) exceeded
|
| |||||||
| |||||||
1 | subtraction modifications in such taxable year, with | ||||||
2 | the following limitations
applied in the order that | ||||||
3 | they are listed: | ||||||
4 | (i) the addition modification relating to the | ||||||
5 | net operating loss
carried back or forward to the | ||||||
6 | taxable year from any taxable year ending
prior to | ||||||
7 | December 31, 1986 shall be reduced by the amount | ||||||
8 | of addition
modification under this subparagraph | ||||||
9 | (E) which related to that net
operating loss and | ||||||
10 | which was taken into account in calculating the | ||||||
11 | base
income of an earlier taxable year, and | ||||||
12 | (ii) the addition modification relating to the | ||||||
13 | net operating loss
carried back or forward to the | ||||||
14 | taxable year from any taxable year ending
prior to | ||||||
15 | December 31, 1986 shall not exceed the amount of | ||||||
16 | such carryback or
carryforward; | ||||||
17 | For taxable years in which there is a net | ||||||
18 | operating loss carryback or
carryforward from more | ||||||
19 | than one other taxable year ending prior to December
| ||||||
20 | 31, 1986, the addition modification provided in this | ||||||
21 | subparagraph (E) shall
be the sum of the amounts | ||||||
22 | computed independently under the preceding
provisions | ||||||
23 | of this subparagraph (E) for each such taxable year; | ||||||
24 | (F) For taxable years ending on or after January | ||||||
25 | 1, 1989, an amount
equal to the tax deducted pursuant | ||||||
26 | to Section 164 of the Internal Revenue
Code if the |
| |||||||
| |||||||
1 | trust or estate is claiming the same tax for purposes | ||||||
2 | of the
Illinois foreign tax credit under Section 601 | ||||||
3 | of this Act; | ||||||
4 | (G) An amount equal to the amount of the capital | ||||||
5 | gain deduction
allowable under the Internal Revenue | ||||||
6 | Code, to the extent deducted from
gross income in the | ||||||
7 | computation of taxable income; | ||||||
8 | (G-5) For taxable years ending after December 31, | ||||||
9 | 1997, an
amount equal to any eligible remediation | ||||||
10 | costs that the trust or estate
deducted in computing | ||||||
11 | adjusted gross income and for which the trust
or | ||||||
12 | estate claims a credit under subsection (l) of Section | ||||||
13 | 201; | ||||||
14 | (G-10) For taxable years 2001 and thereafter, an | ||||||
15 | amount equal to the
bonus depreciation deduction taken | ||||||
16 | on the taxpayer's federal income tax return for the | ||||||
17 | taxable
year under subsection (k) of Section 168 of | ||||||
18 | the Internal Revenue Code; and | ||||||
19 | (G-11) If the taxpayer sells, transfers, abandons, | ||||||
20 | or otherwise disposes of property for which the | ||||||
21 | taxpayer was required in any taxable year to
make an | ||||||
22 | addition modification under subparagraph (G-10), then | ||||||
23 | an amount equal
to the aggregate amount of the | ||||||
24 | deductions taken in all taxable
years under | ||||||
25 | subparagraph (R) with respect to that property. | ||||||
26 | If the taxpayer continues to own property through |
| |||||||
| |||||||
1 | the last day of the last tax year for which a | ||||||
2 | subtraction is allowed with respect to that property | ||||||
3 | under subparagraph (R) and for which the taxpayer was | ||||||
4 | allowed in any taxable year to make a subtraction | ||||||
5 | modification under subparagraph (R), then an amount | ||||||
6 | equal to that subtraction modification.
| ||||||
7 | The taxpayer is required to make the addition | ||||||
8 | modification under this
subparagraph
only once with | ||||||
9 | respect to any one piece of property; | ||||||
10 | (G-12) An amount equal to the amount otherwise | ||||||
11 | allowed as a deduction in computing base income for | ||||||
12 | interest paid, accrued, or incurred, directly or | ||||||
13 | indirectly, (i) for taxable years ending on or after | ||||||
14 | December 31, 2004, to a foreign person who would be a | ||||||
15 | member of the same unitary business group but for the | ||||||
16 | fact that the foreign person's business activity | ||||||
17 | outside the United States is 80% or more of the foreign | ||||||
18 | person's total business activity and (ii) for taxable | ||||||
19 | years ending on or after December 31, 2008, to a person | ||||||
20 | who would be a member of the same unitary business | ||||||
21 | group but for the fact that the person is prohibited | ||||||
22 | under Section 1501(a)(27) from being included in the | ||||||
23 | unitary business group because he or she is ordinarily | ||||||
24 | required to apportion business income under different | ||||||
25 | subsections of Section 304. The addition modification | ||||||
26 | required by this subparagraph shall be reduced to the |
| |||||||
| |||||||
1 | extent that dividends were included in base income of | ||||||
2 | the unitary group for the same taxable year and | ||||||
3 | received by the taxpayer or by a member of the | ||||||
4 | taxpayer's unitary business group (including amounts | ||||||
5 | included in gross income pursuant to Sections 951 | ||||||
6 | through 964 of the Internal Revenue Code and amounts | ||||||
7 | included in gross income under Section 78 of the | ||||||
8 | Internal Revenue Code) with respect to the stock of | ||||||
9 | the same person to whom the interest was paid, | ||||||
10 | accrued, or incurred.
| ||||||
11 | This paragraph shall not apply to the following:
| ||||||
12 | (i) an item of interest paid, accrued, or | ||||||
13 | incurred, directly or indirectly, to a person who | ||||||
14 | is subject in a foreign country or state, other | ||||||
15 | than a state which requires mandatory unitary | ||||||
16 | reporting, to a tax on or measured by net income | ||||||
17 | with respect to such interest; or | ||||||
18 | (ii) an item of interest paid, accrued, or | ||||||
19 | incurred, directly or indirectly, to a person if | ||||||
20 | the taxpayer can establish, based on a | ||||||
21 | preponderance of the evidence, both of the | ||||||
22 | following: | ||||||
23 | (a) the person, during the same taxable | ||||||
24 | year, paid, accrued, or incurred, the interest | ||||||
25 | to a person that is not a related member, and | ||||||
26 | (b) the transaction giving rise to the |
| |||||||
| |||||||
1 | interest expense between the taxpayer and the | ||||||
2 | person did not have as a principal purpose the | ||||||
3 | avoidance of Illinois income tax, and is paid | ||||||
4 | pursuant to a contract or agreement that | ||||||
5 | reflects an arm's-length interest rate and | ||||||
6 | terms; or
| ||||||
7 | (iii) the taxpayer can establish, based on | ||||||
8 | clear and convincing evidence, that the interest | ||||||
9 | paid, accrued, or incurred relates to a contract | ||||||
10 | or agreement entered into at arm's-length rates | ||||||
11 | and terms and the principal purpose for the | ||||||
12 | payment is not federal or Illinois tax avoidance; | ||||||
13 | or
| ||||||
14 | (iv) an item of interest paid, accrued, or | ||||||
15 | incurred, directly or indirectly, to a person if | ||||||
16 | the taxpayer establishes by clear and convincing | ||||||
17 | evidence that the adjustments are unreasonable; or | ||||||
18 | if the taxpayer and the Director agree in writing | ||||||
19 | to the application or use of an alternative method | ||||||
20 | of apportionment under Section 304(f).
| ||||||
21 | Nothing in this subsection shall preclude the | ||||||
22 | Director from making any other adjustment | ||||||
23 | otherwise allowed under Section 404 of this Act | ||||||
24 | for any tax year beginning after the effective | ||||||
25 | date of this amendment provided such adjustment is | ||||||
26 | made pursuant to regulation adopted by the |
| |||||||
| |||||||
1 | Department and such regulations provide methods | ||||||
2 | and standards by which the Department will utilize | ||||||
3 | its authority under Section 404 of this Act;
| ||||||
4 | (G-13) An amount equal to the amount of intangible | ||||||
5 | expenses and costs otherwise allowed as a deduction in | ||||||
6 | computing base income, and that were paid, accrued, or | ||||||
7 | incurred, directly or indirectly, (i) for taxable | ||||||
8 | years ending on or after December 31, 2004, to a | ||||||
9 | foreign person who would be a member of the same | ||||||
10 | unitary business group but for the fact that the | ||||||
11 | foreign person's business activity outside the United | ||||||
12 | States is 80% or more of that person's total business | ||||||
13 | activity and (ii) for taxable years ending on or after | ||||||
14 | December 31, 2008, to a person who would be a member of | ||||||
15 | the same unitary business group but for the fact that | ||||||
16 | the person is prohibited under Section 1501(a)(27) | ||||||
17 | from being included in the unitary business group | ||||||
18 | because he or she is ordinarily required to apportion | ||||||
19 | business income under different subsections of Section | ||||||
20 | 304. The addition modification required by this | ||||||
21 | subparagraph shall be reduced to the extent that | ||||||
22 | dividends were included in base income of the unitary | ||||||
23 | group for the same taxable year and received by the | ||||||
24 | taxpayer or by a member of the taxpayer's unitary | ||||||
25 | business group (including amounts included in gross | ||||||
26 | income pursuant to Sections 951 through 964 of the |
| |||||||
| |||||||
1 | Internal Revenue Code and amounts included in gross | ||||||
2 | income under Section 78 of the Internal Revenue Code) | ||||||
3 | with respect to the stock of the same person to whom | ||||||
4 | the intangible expenses and costs were directly or | ||||||
5 | indirectly paid, incurred, or accrued. The preceding | ||||||
6 | sentence shall not apply to the extent that the same | ||||||
7 | dividends caused a reduction to the addition | ||||||
8 | modification required under Section 203(c)(2)(G-12) of | ||||||
9 | this Act. As used in this subparagraph, the term | ||||||
10 | "intangible expenses and costs" includes: (1) | ||||||
11 | expenses, losses, and costs for or related to the | ||||||
12 | direct or indirect acquisition, use, maintenance or | ||||||
13 | management, ownership, sale, exchange, or any other | ||||||
14 | disposition of intangible property; (2) losses | ||||||
15 | incurred, directly or indirectly, from factoring | ||||||
16 | transactions or discounting transactions; (3) royalty, | ||||||
17 | patent, technical, and copyright fees; (4) licensing | ||||||
18 | fees; and (5) other similar expenses and costs. For | ||||||
19 | purposes of this subparagraph, "intangible property" | ||||||
20 | includes patents, patent applications, trade names, | ||||||
21 | trademarks, service marks, copyrights, mask works, | ||||||
22 | trade secrets, and similar types of intangible assets. | ||||||
23 | This paragraph shall not apply to the following: | ||||||
24 | (i) any item of intangible expenses or costs | ||||||
25 | paid, accrued, or incurred, directly or | ||||||
26 | indirectly, from a transaction with a person who |
| |||||||
| |||||||
1 | is subject in a foreign country or state, other | ||||||
2 | than a state which requires mandatory unitary | ||||||
3 | reporting, to a tax on or measured by net income | ||||||
4 | with respect to such item; or | ||||||
5 | (ii) any item of intangible expense or cost | ||||||
6 | paid, accrued, or incurred, directly or | ||||||
7 | indirectly, if the taxpayer can establish, based | ||||||
8 | on a preponderance of the evidence, both of the | ||||||
9 | following: | ||||||
10 | (a) the person during the same taxable | ||||||
11 | year paid, accrued, or incurred, the | ||||||
12 | intangible expense or cost to a person that is | ||||||
13 | not a related member, and | ||||||
14 | (b) the transaction giving rise to the | ||||||
15 | intangible expense or cost between the | ||||||
16 | taxpayer and the person did not have as a | ||||||
17 | principal purpose the avoidance of Illinois | ||||||
18 | income tax, and is paid pursuant to a contract | ||||||
19 | or agreement that reflects arm's-length terms; | ||||||
20 | or | ||||||
21 | (iii) any item of intangible expense or cost | ||||||
22 | paid, accrued, or incurred, directly or | ||||||
23 | indirectly, from a transaction with a person if | ||||||
24 | the taxpayer establishes by clear and convincing | ||||||
25 | evidence, that the adjustments are unreasonable; | ||||||
26 | or if the taxpayer and the Director agree in |
| |||||||
| |||||||
1 | writing to the application or use of an | ||||||
2 | alternative method of apportionment under Section | ||||||
3 | 304(f);
| ||||||
4 | Nothing in this subsection shall preclude the | ||||||
5 | Director from making any other adjustment | ||||||
6 | otherwise allowed under Section 404 of this Act | ||||||
7 | for any tax year beginning after the effective | ||||||
8 | date of this amendment provided such adjustment is | ||||||
9 | made pursuant to regulation adopted by the | ||||||
10 | Department and such regulations provide methods | ||||||
11 | and standards by which the Department will utilize | ||||||
12 | its authority under Section 404 of this Act;
| ||||||
13 | (G-14) For taxable years ending on or after | ||||||
14 | December 31, 2008, an amount equal to the amount of | ||||||
15 | insurance premium expenses and costs otherwise allowed | ||||||
16 | as a deduction in computing base income, and that were | ||||||
17 | paid, accrued, or incurred, directly or indirectly, to | ||||||
18 | a person who would be a member of the same unitary | ||||||
19 | business group but for the fact that the person is | ||||||
20 | prohibited under Section 1501(a)(27) from being | ||||||
21 | included in the unitary business group because he or | ||||||
22 | she is ordinarily required to apportion business | ||||||
23 | income under different subsections of Section 304. The | ||||||
24 | addition modification required by this subparagraph | ||||||
25 | shall be reduced to the extent that dividends were | ||||||
26 | included in base income of the unitary group for the |
| |||||||
| |||||||
1 | same taxable year and received by the taxpayer or by a | ||||||
2 | member of the taxpayer's unitary business group | ||||||
3 | (including amounts included in gross income under | ||||||
4 | Sections 951 through 964 of the Internal Revenue Code | ||||||
5 | and amounts included in gross income under Section 78 | ||||||
6 | of the Internal Revenue Code) with respect to the | ||||||
7 | stock of the same person to whom the premiums and costs | ||||||
8 | were directly or indirectly paid, incurred, or | ||||||
9 | accrued. The preceding sentence does not apply to the | ||||||
10 | extent that the same dividends caused a reduction to | ||||||
11 | the addition modification required under Section | ||||||
12 | 203(c)(2)(G-12) or Section 203(c)(2)(G-13) of this | ||||||
13 | Act; | ||||||
14 | (G-15) An amount equal to the credit allowable to | ||||||
15 | the taxpayer under Section 218(a) of this Act, | ||||||
16 | determined without regard to Section 218(c) of this | ||||||
17 | Act; | ||||||
18 | (G-16) For taxable years ending on or after | ||||||
19 | December 31, 2017, an amount equal to the deduction | ||||||
20 | allowed under Section 199 of the Internal Revenue Code | ||||||
21 | for the taxable year; | ||||||
22 | (G-17) the amount that is claimed as a federal | ||||||
23 | deduction when computing the taxpayer's federal | ||||||
24 | taxable income for the taxable year and that is | ||||||
25 | attributable to an endowment gift for which the | ||||||
26 | taxpayer receives a credit under the Endow Illinois |
| |||||||
| |||||||
1 | Tax Credit Act; | ||||||
2 | and by deducting from the total so obtained the sum of the | ||||||
3 | following
amounts: | ||||||
4 | (H) An amount equal to all amounts included in | ||||||
5 | such total pursuant
to the provisions of Sections | ||||||
6 | 402(a), 402(c), 403(a), 403(b), 406(a), 407(a)
and 408 | ||||||
7 | of the Internal Revenue Code or included in such total | ||||||
8 | as
distributions under the provisions of any | ||||||
9 | retirement or disability plan for
employees of any | ||||||
10 | governmental agency or unit, or retirement payments to
| ||||||
11 | retired partners, which payments are excluded in | ||||||
12 | computing net earnings
from self employment by Section | ||||||
13 | 1402 of the Internal Revenue Code and
regulations | ||||||
14 | adopted pursuant thereto; | ||||||
15 | (I) The valuation limitation amount; | ||||||
16 | (J) An amount equal to the amount of any tax | ||||||
17 | imposed by this Act
which was refunded to the taxpayer | ||||||
18 | and included in such total for the
taxable year; | ||||||
19 | (K) An amount equal to all amounts included in | ||||||
20 | taxable income as
modified by subparagraphs (A), (B), | ||||||
21 | (C), (D), (E), (F) and (G) which
are exempt from | ||||||
22 | taxation by this State either by reason of its | ||||||
23 | statutes or
Constitution
or by reason of the | ||||||
24 | Constitution, treaties or statutes of the United | ||||||
25 | States;
provided that, in the case of any statute of | ||||||
26 | this State that exempts income
derived from bonds or |
| |||||||
| |||||||
1 | other obligations from the tax imposed under this Act,
| ||||||
2 | the amount exempted shall be the interest net of bond | ||||||
3 | premium amortization; | ||||||
4 | (L) With the exception of any amounts subtracted | ||||||
5 | under subparagraph
(K),
an amount equal to the sum of | ||||||
6 | all amounts disallowed as
deductions by (i) Sections | ||||||
7 | 171(a)(2) and 265(a)(2) of the Internal Revenue
Code, | ||||||
8 | and all amounts of expenses allocable
to interest and | ||||||
9 | disallowed as deductions by Section 265(a)(1) of the | ||||||
10 | Internal
Revenue Code;
and (ii) for taxable years
| ||||||
11 | ending on or after August 13, 1999, Sections
| ||||||
12 | 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of the | ||||||
13 | Internal Revenue Code, plus, (iii) for taxable years | ||||||
14 | ending on or after December 31, 2011, Section | ||||||
15 | 45G(e)(3) of the Internal Revenue Code and, for | ||||||
16 | taxable years ending on or after December 31, 2008, | ||||||
17 | any amount included in gross income under Section 87 | ||||||
18 | of the Internal Revenue Code; the provisions of this
| ||||||
19 | subparagraph are exempt from the provisions of Section | ||||||
20 | 250; | ||||||
21 | (M) An amount equal to those dividends included in | ||||||
22 | such total
which were paid by a corporation which | ||||||
23 | conducts business operations in a River Edge | ||||||
24 | Redevelopment Zone or zones created under the River | ||||||
25 | Edge Redevelopment Zone Act and
conducts substantially | ||||||
26 | all of its operations in a River Edge Redevelopment |
| |||||||
| |||||||
1 | Zone or zones. This subparagraph (M) is exempt from | ||||||
2 | the provisions of Section 250; | ||||||
3 | (N) An amount equal to any contribution made to a | ||||||
4 | job training
project established pursuant to the Tax | ||||||
5 | Increment Allocation
Redevelopment Act; | ||||||
6 | (O) An amount equal to those dividends included in | ||||||
7 | such total
that were paid by a corporation that | ||||||
8 | conducts business operations in a
federally designated | ||||||
9 | Foreign Trade Zone or Sub-Zone and that is designated
| ||||||
10 | a High Impact Business located in Illinois; provided | ||||||
11 | that dividends eligible
for the deduction provided in | ||||||
12 | subparagraph (M) of paragraph (2) of this
subsection | ||||||
13 | shall not be eligible for the deduction provided under | ||||||
14 | this
subparagraph (O); | ||||||
15 | (P) An amount equal to the amount of the deduction | ||||||
16 | used to compute the
federal income tax credit for | ||||||
17 | restoration of substantial amounts held under
claim of | ||||||
18 | right for the taxable year pursuant to Section 1341 of | ||||||
19 | the
Internal Revenue Code; | ||||||
20 | (Q) For taxable year 1999 and thereafter, an | ||||||
21 | amount equal to the
amount of any
(i) distributions, | ||||||
22 | to the extent includible in gross income for
federal | ||||||
23 | income tax purposes, made to the taxpayer because of
| ||||||
24 | his or her status as a victim of
persecution for racial | ||||||
25 | or religious reasons by Nazi Germany or any other Axis
| ||||||
26 | regime or as an heir of the victim and (ii) items
of |
| |||||||
| |||||||
1 | income, to the extent
includible in gross income for | ||||||
2 | federal income tax purposes, attributable to,
derived | ||||||
3 | from or in any way related to assets stolen from, | ||||||
4 | hidden from, or
otherwise lost to a victim of
| ||||||
5 | persecution for racial or religious reasons by Nazi
| ||||||
6 | Germany or any other Axis regime
immediately prior to, | ||||||
7 | during, and immediately after World War II, including,
| ||||||
8 | but
not limited to, interest on the proceeds | ||||||
9 | receivable as insurance
under policies issued to a | ||||||
10 | victim of persecution for racial or religious
reasons | ||||||
11 | by Nazi Germany or any other Axis regime by European | ||||||
12 | insurance
companies
immediately prior to and during | ||||||
13 | World War II;
provided, however, this subtraction from | ||||||
14 | federal adjusted gross income does not
apply to assets | ||||||
15 | acquired with such assets or with the proceeds from | ||||||
16 | the sale of
such assets; provided, further, this | ||||||
17 | paragraph shall only apply to a taxpayer
who was the | ||||||
18 | first recipient of such assets after their recovery | ||||||
19 | and who is a
victim of
persecution for racial or | ||||||
20 | religious reasons
by Nazi Germany or any other Axis | ||||||
21 | regime or as an heir of the victim. The
amount of and | ||||||
22 | the eligibility for any public assistance, benefit, or
| ||||||
23 | similar entitlement is not affected by the inclusion | ||||||
24 | of items (i) and (ii) of
this paragraph in gross income | ||||||
25 | for federal income tax purposes.
This paragraph is | ||||||
26 | exempt from the provisions of Section 250; |
| |||||||
| |||||||
1 | (R) For taxable years 2001 and thereafter, for the | ||||||
2 | taxable year in
which the bonus depreciation deduction
| ||||||
3 | is taken on the taxpayer's federal income tax return | ||||||
4 | under
subsection (k) of Section 168 of the Internal | ||||||
5 | Revenue Code and for each
applicable taxable year | ||||||
6 | thereafter, an amount equal to "x", where: | ||||||
7 | (1) "y" equals the amount of the depreciation | ||||||
8 | deduction taken for the
taxable year
on the | ||||||
9 | taxpayer's federal income tax return on property | ||||||
10 | for which the bonus
depreciation deduction
was | ||||||
11 | taken in any year under subsection (k) of Section | ||||||
12 | 168 of the Internal
Revenue Code, but not | ||||||
13 | including the bonus depreciation deduction; | ||||||
14 | (2) for taxable years ending on or before | ||||||
15 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
16 | and then divided by 70 (or "y"
multiplied by | ||||||
17 | 0.429); and | ||||||
18 | (3) for taxable years ending after December | ||||||
19 | 31, 2005: | ||||||
20 | (i) for property on which a bonus | ||||||
21 | depreciation deduction of 30% of the adjusted | ||||||
22 | basis was taken, "x" equals "y" multiplied by | ||||||
23 | 30 and then divided by 70 (or "y"
multiplied | ||||||
24 | by 0.429); | ||||||
25 | (ii) for property on which a bonus | ||||||
26 | depreciation deduction of 50% of the adjusted |
| |||||||
| |||||||
1 | basis was taken, "x" equals "y" multiplied by | ||||||
2 | 1.0; | ||||||
3 | (iii) for property on which a bonus | ||||||
4 | depreciation deduction of 100% of the adjusted | ||||||
5 | basis was taken in a taxable year ending on or | ||||||
6 | after December 31, 2021, "x" equals the | ||||||
7 | depreciation deduction that would be allowed | ||||||
8 | on that property if the taxpayer had made the | ||||||
9 | election under Section 168(k)(7) of the | ||||||
10 | Internal Revenue Code to not claim bonus | ||||||
11 | depreciation on that property; and | ||||||
12 | (iv) for property on which a bonus | ||||||
13 | depreciation deduction of a percentage other | ||||||
14 | than 30%, 50% or 100% of the adjusted basis | ||||||
15 | was taken in a taxable year ending on or after | ||||||
16 | December 31, 2021, "x" equals "y" multiplied | ||||||
17 | by 100 times the percentage bonus depreciation | ||||||
18 | on the property (that is, 100(bonus%)) and | ||||||
19 | then divided by 100 times 1 minus the | ||||||
20 | percentage bonus depreciation on the property | ||||||
21 | (that is, 100(1–bonus%)). | ||||||
22 | The aggregate amount deducted under this | ||||||
23 | subparagraph in all taxable
years for any one piece of | ||||||
24 | property may not exceed the amount of the bonus
| ||||||
25 | depreciation deduction
taken on that property on the | ||||||
26 | taxpayer's federal income tax return under
subsection |
| |||||||
| |||||||
1 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
2 | subparagraph (R) is exempt from the provisions of | ||||||
3 | Section 250; | ||||||
4 | (S) If the taxpayer sells, transfers, abandons, or | ||||||
5 | otherwise disposes of
property for which the taxpayer | ||||||
6 | was required in any taxable year to make an
addition | ||||||
7 | modification under subparagraph (G-10), then an amount | ||||||
8 | equal to that
addition modification. | ||||||
9 | If the taxpayer continues to own property through | ||||||
10 | the last day of the last tax year for which a | ||||||
11 | subtraction is allowed with respect to that property | ||||||
12 | under subparagraph (R) and for which the taxpayer was | ||||||
13 | required in any taxable year to make an addition | ||||||
14 | modification under subparagraph (G-10), then an amount | ||||||
15 | equal to that addition modification.
| ||||||
16 | The taxpayer is allowed to take the deduction | ||||||
17 | under this subparagraph
only once with respect to any | ||||||
18 | one piece of property. | ||||||
19 | This subparagraph (S) is exempt from the | ||||||
20 | provisions of Section 250; | ||||||
21 | (T) The amount of (i) any interest income (net of | ||||||
22 | the deductions allocable thereto) taken into account | ||||||
23 | for the taxable year with respect to a transaction | ||||||
24 | with a taxpayer that is required to make an addition | ||||||
25 | modification with respect to such transaction under | ||||||
26 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), |
| |||||||
| |||||||
1 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
2 | the amount of such addition modification and
(ii) any | ||||||
3 | income from intangible property (net of the deductions | ||||||
4 | allocable thereto) taken into account for the taxable | ||||||
5 | year with respect to a transaction with a taxpayer | ||||||
6 | that is required to make an addition modification with | ||||||
7 | respect to such transaction under Section | ||||||
8 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
9 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
10 | addition modification. This subparagraph (T) is exempt | ||||||
11 | from the provisions of Section 250;
| ||||||
12 | (U) An amount equal to the interest income taken | ||||||
13 | into account for the taxable year (net of the | ||||||
14 | deductions allocable thereto) with respect to | ||||||
15 | transactions with (i) a foreign person who would be a | ||||||
16 | member of the taxpayer's unitary business group but | ||||||
17 | for the fact the foreign person's business activity | ||||||
18 | outside the United States is 80% or more of that | ||||||
19 | person's total business activity and (ii) for taxable | ||||||
20 | years ending on or after December 31, 2008, to a person | ||||||
21 | who would be a member of the same unitary business | ||||||
22 | group but for the fact that the person is prohibited | ||||||
23 | under Section 1501(a)(27) from being included in the | ||||||
24 | unitary business group because he or she is ordinarily | ||||||
25 | required to apportion business income under different | ||||||
26 | subsections of Section 304, but not to exceed the |
| |||||||
| |||||||
1 | addition modification required to be made for the same | ||||||
2 | taxable year under Section 203(c)(2)(G-12) for | ||||||
3 | interest paid, accrued, or incurred, directly or | ||||||
4 | indirectly, to the same person. This subparagraph (U) | ||||||
5 | is exempt from the provisions of Section 250; | ||||||
6 | (V) An amount equal to the income from intangible | ||||||
7 | property taken into account for the taxable year (net | ||||||
8 | of the deductions allocable thereto) with respect to | ||||||
9 | transactions with (i) a foreign person who would be a | ||||||
10 | member of the taxpayer's unitary business group but | ||||||
11 | for the fact that the foreign person's business | ||||||
12 | activity outside the United States is 80% or more of | ||||||
13 | that person's total business activity and (ii) for | ||||||
14 | taxable years ending on or after December 31, 2008, to | ||||||
15 | a person who would be a member of the same unitary | ||||||
16 | business group but for the fact that the person is | ||||||
17 | prohibited under Section 1501(a)(27) from being | ||||||
18 | included in the unitary business group because he or | ||||||
19 | she is ordinarily required to apportion business | ||||||
20 | income under different subsections of Section 304, but | ||||||
21 | not to exceed the addition modification required to be | ||||||
22 | made for the same taxable year under Section | ||||||
23 | 203(c)(2)(G-13) for intangible expenses and costs | ||||||
24 | paid, accrued, or incurred, directly or indirectly, to | ||||||
25 | the same foreign person. This subparagraph (V) is | ||||||
26 | exempt from the provisions of Section 250;
|
| |||||||
| |||||||
1 | (W) in the case of an estate, an amount equal to | ||||||
2 | all amounts included in such total pursuant to the | ||||||
3 | provisions of Section 111 of the Internal Revenue Code | ||||||
4 | as a recovery of items previously deducted by the | ||||||
5 | decedent from adjusted gross income in the computation | ||||||
6 | of taxable income. This subparagraph (W) is exempt | ||||||
7 | from Section 250; | ||||||
8 | (X) an amount equal to the refund included in such | ||||||
9 | total of any tax deducted for federal income tax | ||||||
10 | purposes, to the extent that deduction was added back | ||||||
11 | under subparagraph (F). This subparagraph (X) is | ||||||
12 | exempt from the provisions of Section 250; | ||||||
13 | (Y) For taxable years ending on or after December | ||||||
14 | 31, 2011, in the case of a taxpayer who was required to | ||||||
15 | add back any insurance premiums under Section | ||||||
16 | 203(c)(2)(G-14), such taxpayer may elect to subtract | ||||||
17 | that part of a reimbursement received from the | ||||||
18 | insurance company equal to the amount of the expense | ||||||
19 | or loss (including expenses incurred by the insurance | ||||||
20 | company) that would have been taken into account as a | ||||||
21 | deduction for federal income tax purposes if the | ||||||
22 | expense or loss had been uninsured. If a taxpayer | ||||||
23 | makes the election provided for by this subparagraph | ||||||
24 | (Y), the insurer to which the premiums were paid must | ||||||
25 | add back to income the amount subtracted by the | ||||||
26 | taxpayer pursuant to this subparagraph (Y). This |
| |||||||
| |||||||
1 | subparagraph (Y) is exempt from the provisions of | ||||||
2 | Section 250; and | ||||||
3 | (Z) For taxable years beginning after December 31, | ||||||
4 | 2018 and before January 1, 2026, the amount of excess | ||||||
5 | business loss of the taxpayer disallowed as a | ||||||
6 | deduction by Section 461(l)(1)(B) of the Internal | ||||||
7 | Revenue Code. | ||||||
8 | (3) Limitation. The amount of any modification | ||||||
9 | otherwise required
under this subsection shall, under | ||||||
10 | regulations prescribed by the
Department, be adjusted by | ||||||
11 | any amounts included therein which were
properly paid, | ||||||
12 | credited, or required to be distributed, or permanently | ||||||
13 | set
aside for charitable purposes pursuant to Internal | ||||||
14 | Revenue Code Section
642(c) during the taxable year. | ||||||
15 | (d) Partnerships. | ||||||
16 | (1) In general. In the case of a partnership, base | ||||||
17 | income means an
amount equal to the taxpayer's taxable | ||||||
18 | income for the taxable year as
modified by paragraph (2). | ||||||
19 | (2) Modifications. The taxable income referred to in | ||||||
20 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
21 | of the following amounts: | ||||||
22 | (A) An amount equal to all amounts paid or accrued | ||||||
23 | to the taxpayer as
interest or dividends during the | ||||||
24 | taxable year to the extent excluded from
gross income | ||||||
25 | in the computation of taxable income; |
| |||||||
| |||||||
1 | (B) An amount equal to the amount of tax imposed by | ||||||
2 | this Act to the
extent deducted from gross income for | ||||||
3 | the taxable year; | ||||||
4 | (C) The amount of deductions allowed to the | ||||||
5 | partnership pursuant to
Section 707 (c) of the | ||||||
6 | Internal Revenue Code in calculating its taxable | ||||||
7 | income; | ||||||
8 | (D) An amount equal to the amount of the capital | ||||||
9 | gain deduction
allowable under the Internal Revenue | ||||||
10 | Code, to the extent deducted from
gross income in the | ||||||
11 | computation of taxable income; | ||||||
12 | (D-5) For taxable years 2001 and thereafter, an | ||||||
13 | amount equal to the
bonus depreciation deduction taken | ||||||
14 | on the taxpayer's federal income tax return for the | ||||||
15 | taxable
year under subsection (k) of Section 168 of | ||||||
16 | the Internal Revenue Code; | ||||||
17 | (D-6) If the taxpayer sells, transfers, abandons, | ||||||
18 | or otherwise disposes of
property for which the | ||||||
19 | taxpayer was required in any taxable year to make an
| ||||||
20 | addition modification under subparagraph (D-5), then | ||||||
21 | an amount equal to the
aggregate amount of the | ||||||
22 | deductions taken in all taxable years
under | ||||||
23 | subparagraph (O) with respect to that property. | ||||||
24 | If the taxpayer continues to own property through | ||||||
25 | the last day of the last tax year for which a | ||||||
26 | subtraction is allowed with respect to that property |
| |||||||
| |||||||
1 | under subparagraph (O) and for which the taxpayer was | ||||||
2 | allowed in any taxable year to make a subtraction | ||||||
3 | modification under subparagraph (O), then an amount | ||||||
4 | equal to that subtraction modification.
| ||||||
5 | The taxpayer is required to make the addition | ||||||
6 | modification under this
subparagraph
only once with | ||||||
7 | respect to any one piece of property; | ||||||
8 | (D-7) An amount equal to the amount otherwise | ||||||
9 | allowed as a deduction in computing base income for | ||||||
10 | interest paid, accrued, or incurred, directly or | ||||||
11 | indirectly, (i) for taxable years ending on or after | ||||||
12 | December 31, 2004, to a foreign person who would be a | ||||||
13 | member of the same unitary business group but for the | ||||||
14 | fact the foreign person's business activity outside | ||||||
15 | the United States is 80% or more of the foreign | ||||||
16 | person's total business activity and (ii) for taxable | ||||||
17 | years ending on or after December 31, 2008, to a person | ||||||
18 | who would be a member of the same unitary business | ||||||
19 | group but for the fact that the person is prohibited | ||||||
20 | under Section 1501(a)(27) from being included in the | ||||||
21 | unitary business group because he or she is ordinarily | ||||||
22 | required to apportion business income under different | ||||||
23 | subsections of Section 304. The addition modification | ||||||
24 | required by this subparagraph shall be reduced to the | ||||||
25 | extent that dividends were included in base income of | ||||||
26 | the unitary group for the same taxable year and |
| |||||||
| |||||||
1 | received by the taxpayer or by a member of the | ||||||
2 | taxpayer's unitary business group (including amounts | ||||||
3 | included in gross income pursuant to Sections 951 | ||||||
4 | through 964 of the Internal Revenue Code and amounts | ||||||
5 | included in gross income under Section 78 of the | ||||||
6 | Internal Revenue Code) with respect to the stock of | ||||||
7 | the same person to whom the interest was paid, | ||||||
8 | accrued, or incurred.
| ||||||
9 | This paragraph shall not apply to the following:
| ||||||
10 | (i) an item of interest paid, accrued, or | ||||||
11 | incurred, directly or indirectly, to a person who | ||||||
12 | is subject in a foreign country or state, other | ||||||
13 | than a state which requires mandatory unitary | ||||||
14 | reporting, to a tax on or measured by net income | ||||||
15 | with respect to such interest; or | ||||||
16 | (ii) an item of interest paid, accrued, or | ||||||
17 | incurred, directly or indirectly, to a person if | ||||||
18 | the taxpayer can establish, based on a | ||||||
19 | preponderance of the evidence, both of the | ||||||
20 | following: | ||||||
21 | (a) the person, during the same taxable | ||||||
22 | year, paid, accrued, or incurred, the interest | ||||||
23 | to a person that is not a related member, and | ||||||
24 | (b) the transaction giving rise to the | ||||||
25 | interest expense between the taxpayer and the | ||||||
26 | person did not have as a principal purpose the |
| |||||||
| |||||||
1 | avoidance of Illinois income tax, and is paid | ||||||
2 | pursuant to a contract or agreement that | ||||||
3 | reflects an arm's-length interest rate and | ||||||
4 | terms; or
| ||||||
5 | (iii) the taxpayer can establish, based on | ||||||
6 | clear and convincing evidence, that the interest | ||||||
7 | paid, accrued, or incurred relates to a contract | ||||||
8 | or agreement entered into at arm's-length rates | ||||||
9 | and terms and the principal purpose for the | ||||||
10 | payment is not federal or Illinois tax avoidance; | ||||||
11 | or
| ||||||
12 | (iv) an item of interest paid, accrued, or | ||||||
13 | incurred, directly or indirectly, to a person if | ||||||
14 | the taxpayer establishes by clear and convincing | ||||||
15 | evidence that the adjustments are unreasonable; or | ||||||
16 | if the taxpayer and the Director agree in writing | ||||||
17 | to the application or use of an alternative method | ||||||
18 | of apportionment under Section 304(f).
| ||||||
19 | Nothing in this subsection shall preclude the | ||||||
20 | Director from making any other adjustment | ||||||
21 | otherwise allowed under Section 404 of this Act | ||||||
22 | for any tax year beginning after the effective | ||||||
23 | date of this amendment provided such adjustment is | ||||||
24 | made pursuant to regulation adopted by the | ||||||
25 | Department and such regulations provide methods | ||||||
26 | and standards by which the Department will utilize |
| |||||||
| |||||||
1 | its authority under Section 404 of this Act; and
| ||||||
2 | (D-8) An amount equal to the amount of intangible | ||||||
3 | expenses and costs otherwise allowed as a deduction in | ||||||
4 | computing base income, and that were paid, accrued, or | ||||||
5 | incurred, directly or indirectly, (i) for taxable | ||||||
6 | years ending on or after December 31, 2004, to a | ||||||
7 | foreign person who would be a member of the same | ||||||
8 | unitary business group but for the fact that the | ||||||
9 | foreign person's business activity outside the United | ||||||
10 | States is 80% or more of that person's total business | ||||||
11 | activity and (ii) for taxable years ending on or after | ||||||
12 | December 31, 2008, to a person who would be a member of | ||||||
13 | the same unitary business group but for the fact that | ||||||
14 | the person is prohibited under Section 1501(a)(27) | ||||||
15 | from being included in the unitary business group | ||||||
16 | because he or she is ordinarily required to apportion | ||||||
17 | business income under different subsections of Section | ||||||
18 | 304. The addition modification required by this | ||||||
19 | subparagraph shall be reduced to the extent that | ||||||
20 | dividends were included in base income of the unitary | ||||||
21 | group for the same taxable year and received by the | ||||||
22 | taxpayer or by a member of the taxpayer's unitary | ||||||
23 | business group (including amounts included in gross | ||||||
24 | income pursuant to Sections 951 through 964 of the | ||||||
25 | Internal Revenue Code and amounts included in gross | ||||||
26 | income under Section 78 of the Internal Revenue Code) |
| |||||||
| |||||||
1 | with respect to the stock of the same person to whom | ||||||
2 | the intangible expenses and costs were directly or | ||||||
3 | indirectly paid, incurred or accrued. The preceding | ||||||
4 | sentence shall not apply to the extent that the same | ||||||
5 | dividends caused a reduction to the addition | ||||||
6 | modification required under Section 203(d)(2)(D-7) of | ||||||
7 | this Act. As used in this subparagraph, the term | ||||||
8 | "intangible expenses and costs" includes (1) expenses, | ||||||
9 | losses, and costs for, or related to, the direct or | ||||||
10 | indirect acquisition, use, maintenance or management, | ||||||
11 | ownership, sale, exchange, or any other disposition of | ||||||
12 | intangible property; (2) losses incurred, directly or | ||||||
13 | indirectly, from factoring transactions or discounting | ||||||
14 | transactions; (3) royalty, patent, technical, and | ||||||
15 | copyright fees; (4) licensing fees; and (5) other | ||||||
16 | similar expenses and costs. For purposes of this | ||||||
17 | subparagraph, "intangible property" includes patents, | ||||||
18 | patent applications, trade names, trademarks, service | ||||||
19 | marks, copyrights, mask works, trade secrets, and | ||||||
20 | similar types of intangible assets; | ||||||
21 | This paragraph shall not apply to the following: | ||||||
22 | (i) any item of intangible expenses or costs | ||||||
23 | paid, accrued, or incurred, directly or | ||||||
24 | indirectly, from a transaction with a person who | ||||||
25 | is subject in a foreign country or state, other | ||||||
26 | than a state which requires mandatory unitary |
| |||||||
| |||||||
1 | reporting, to a tax on or measured by net income | ||||||
2 | with respect to such item; or | ||||||
3 | (ii) any item of intangible expense or cost | ||||||
4 | paid, accrued, or incurred, directly or | ||||||
5 | indirectly, if the taxpayer can establish, based | ||||||
6 | on a preponderance of the evidence, both of the | ||||||
7 | following: | ||||||
8 | (a) the person during the same taxable | ||||||
9 | year paid, accrued, or incurred, the | ||||||
10 | intangible expense or cost to a person that is | ||||||
11 | not a related member, and | ||||||
12 | (b) the transaction giving rise to the | ||||||
13 | intangible expense or cost between the | ||||||
14 | taxpayer and the person did not have as a | ||||||
15 | principal purpose the avoidance of Illinois | ||||||
16 | income tax, and is paid pursuant to a contract | ||||||
17 | or agreement that reflects arm's-length terms; | ||||||
18 | or | ||||||
19 | (iii) any item of intangible expense or cost | ||||||
20 | paid, accrued, or incurred, directly or | ||||||
21 | indirectly, from a transaction with a person if | ||||||
22 | the taxpayer establishes by clear and convincing | ||||||
23 | evidence, that the adjustments are unreasonable; | ||||||
24 | or if the taxpayer and the Director agree in | ||||||
25 | writing to the application or use of an | ||||||
26 | alternative method of apportionment under Section |
| |||||||
| |||||||
1 | 304(f);
| ||||||
2 | Nothing in this subsection shall preclude the | ||||||
3 | Director from making any other adjustment | ||||||
4 | otherwise allowed under Section 404 of this Act | ||||||
5 | for any tax year beginning after the effective | ||||||
6 | date of this amendment provided such adjustment is | ||||||
7 | made pursuant to regulation adopted by the | ||||||
8 | Department and such regulations provide methods | ||||||
9 | and standards by which the Department will utilize | ||||||
10 | its authority under Section 404 of this Act;
| ||||||
11 | (D-9) For taxable years ending on or after | ||||||
12 | December 31, 2008, an amount equal to the amount of | ||||||
13 | insurance premium expenses and costs otherwise allowed | ||||||
14 | as a deduction in computing base income, and that were | ||||||
15 | paid, accrued, or incurred, directly or indirectly, to | ||||||
16 | a person who would be a member of the same unitary | ||||||
17 | business group but for the fact that the person is | ||||||
18 | prohibited under Section 1501(a)(27) from being | ||||||
19 | included in the unitary business group because he or | ||||||
20 | she is ordinarily required to apportion business | ||||||
21 | income under different subsections of Section 304. The | ||||||
22 | addition modification required by this subparagraph | ||||||
23 | shall be reduced to the extent that dividends were | ||||||
24 | included in base income of the unitary group for the | ||||||
25 | same taxable year and received by the taxpayer or by a | ||||||
26 | member of the taxpayer's unitary business group |
| |||||||
| |||||||
1 | (including amounts included in gross income under | ||||||
2 | Sections 951 through 964 of the Internal Revenue Code | ||||||
3 | and amounts included in gross income under Section 78 | ||||||
4 | of the Internal Revenue Code) with respect to the | ||||||
5 | stock of the same person to whom the premiums and costs | ||||||
6 | were directly or indirectly paid, incurred, or | ||||||
7 | accrued. The preceding sentence does not apply to the | ||||||
8 | extent that the same dividends caused a reduction to | ||||||
9 | the addition modification required under Section | ||||||
10 | 203(d)(2)(D-7) or Section 203(d)(2)(D-8) of this Act; | ||||||
11 | (D-10) An amount equal to the credit allowable to | ||||||
12 | the taxpayer under Section 218(a) of this Act, | ||||||
13 | determined without regard to Section 218(c) of this | ||||||
14 | Act; | ||||||
15 | (D-11) For taxable years ending on or after | ||||||
16 | December 31, 2017, an amount equal to the deduction | ||||||
17 | allowed under Section 199 of the Internal Revenue Code | ||||||
18 | for the taxable year; | ||||||
19 | (D-12) the amount that is claimed as a federal | ||||||
20 | deduction when computing the taxpayer's federal | ||||||
21 | taxable income for the taxable year and that is | ||||||
22 | attributable to an endowment gift for which the | ||||||
23 | taxpayer receives a credit under the Endow Illinois | ||||||
24 | Tax Credit Act; | ||||||
25 | and by deducting from the total so obtained the following | ||||||
26 | amounts: |
| |||||||
| |||||||
1 | (E) The valuation limitation amount; | ||||||
2 | (F) An amount equal to the amount of any tax | ||||||
3 | imposed by this Act which
was refunded to the taxpayer | ||||||
4 | and included in such total for the taxable year; | ||||||
5 | (G) An amount equal to all amounts included in | ||||||
6 | taxable income as
modified by subparagraphs (A), (B), | ||||||
7 | (C) and (D) which are exempt from
taxation by this | ||||||
8 | State either by reason of its statutes or Constitution | ||||||
9 | or
by reason of
the Constitution, treaties or statutes | ||||||
10 | of the United States;
provided that, in the case of any | ||||||
11 | statute of this State that exempts income
derived from | ||||||
12 | bonds or other obligations from the tax imposed under | ||||||
13 | this Act,
the amount exempted shall be the interest | ||||||
14 | net of bond premium amortization; | ||||||
15 | (H) Any income of the partnership which | ||||||
16 | constitutes personal service
income as defined in | ||||||
17 | Section 1348(b)(1) of the Internal Revenue Code (as
in | ||||||
18 | effect December 31, 1981) or a reasonable allowance | ||||||
19 | for compensation
paid or accrued for services rendered | ||||||
20 | by partners to the partnership,
whichever is greater; | ||||||
21 | this subparagraph (H) is exempt from the provisions of | ||||||
22 | Section 250; | ||||||
23 | (I) An amount equal to all amounts of income | ||||||
24 | distributable to an entity
subject to the Personal | ||||||
25 | Property Tax Replacement Income Tax imposed by
| ||||||
26 | subsections (c) and (d) of Section 201 of this Act |
| |||||||
| |||||||
1 | including amounts
distributable to organizations | ||||||
2 | exempt from federal income tax by reason of
Section | ||||||
3 | 501(a) of the Internal Revenue Code; this subparagraph | ||||||
4 | (I) is exempt from the provisions of Section 250; | ||||||
5 | (J) With the exception of any amounts subtracted | ||||||
6 | under subparagraph
(G),
an amount equal to the sum of | ||||||
7 | all amounts disallowed as deductions
by (i) Sections | ||||||
8 | 171(a)(2) and 265(a)(2) of the Internal Revenue Code, | ||||||
9 | and all amounts of expenses allocable to
interest and | ||||||
10 | disallowed as deductions by Section 265(a)(1) of the | ||||||
11 | Internal
Revenue Code;
and (ii) for taxable years
| ||||||
12 | ending on or after August 13, 1999, Sections
| ||||||
13 | 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of the | ||||||
14 | Internal Revenue Code, plus, (iii) for taxable years | ||||||
15 | ending on or after December 31, 2011, Section | ||||||
16 | 45G(e)(3) of the Internal Revenue Code and, for | ||||||
17 | taxable years ending on or after December 31, 2008, | ||||||
18 | any amount included in gross income under Section 87 | ||||||
19 | of the Internal Revenue Code; the provisions of this
| ||||||
20 | subparagraph are exempt from the provisions of Section | ||||||
21 | 250; | ||||||
22 | (K) An amount equal to those dividends included in | ||||||
23 | such total which were
paid by a corporation which | ||||||
24 | conducts business operations in a River Edge | ||||||
25 | Redevelopment Zone or zones created under the River | ||||||
26 | Edge Redevelopment Zone Act and
conducts substantially |
| |||||||
| |||||||
1 | all of its operations
from a River Edge Redevelopment | ||||||
2 | Zone or zones. This subparagraph (K) is exempt from | ||||||
3 | the provisions of Section 250; | ||||||
4 | (L) An amount equal to any contribution made to a | ||||||
5 | job training project
established pursuant to the Real | ||||||
6 | Property Tax Increment Allocation
Redevelopment Act; | ||||||
7 | (M) An amount equal to those dividends included in | ||||||
8 | such total
that were paid by a corporation that | ||||||
9 | conducts business operations in a
federally designated | ||||||
10 | Foreign Trade Zone or Sub-Zone and that is designated | ||||||
11 | a
High Impact Business located in Illinois; provided | ||||||
12 | that dividends eligible
for the deduction provided in | ||||||
13 | subparagraph (K) of paragraph (2) of this
subsection | ||||||
14 | shall not be eligible for the deduction provided under | ||||||
15 | this
subparagraph (M); | ||||||
16 | (N) An amount equal to the amount of the deduction | ||||||
17 | used to compute the
federal income tax credit for | ||||||
18 | restoration of substantial amounts held under
claim of | ||||||
19 | right for the taxable year pursuant to Section 1341 of | ||||||
20 | the
Internal Revenue Code; | ||||||
21 | (O) For taxable years 2001 and thereafter, for the | ||||||
22 | taxable year in
which the bonus depreciation deduction
| ||||||
23 | is taken on the taxpayer's federal income tax return | ||||||
24 | under
subsection (k) of Section 168 of the Internal | ||||||
25 | Revenue Code and for each
applicable taxable year | ||||||
26 | thereafter, an amount equal to "x", where: |
| |||||||
| |||||||
1 | (1) "y" equals the amount of the depreciation | ||||||
2 | deduction taken for the
taxable year
on the | ||||||
3 | taxpayer's federal income tax return on property | ||||||
4 | for which the bonus
depreciation deduction
was | ||||||
5 | taken in any year under subsection (k) of Section | ||||||
6 | 168 of the Internal
Revenue Code, but not | ||||||
7 | including the bonus depreciation deduction; | ||||||
8 | (2) for taxable years ending on or before | ||||||
9 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
10 | and then divided by 70 (or "y"
multiplied by | ||||||
11 | 0.429); and | ||||||
12 | (3) for taxable years ending after December | ||||||
13 | 31, 2005: | ||||||
14 | (i) for property on which a bonus | ||||||
15 | depreciation deduction of 30% of the adjusted | ||||||
16 | basis was taken, "x" equals "y" multiplied by | ||||||
17 | 30 and then divided by 70 (or "y"
multiplied | ||||||
18 | by 0.429); | ||||||
19 | (ii) for property on which a bonus | ||||||
20 | depreciation deduction of 50% of the adjusted | ||||||
21 | basis was taken, "x" equals "y" multiplied by | ||||||
22 | 1.0; | ||||||
23 | (iii) for property on which a bonus | ||||||
24 | depreciation deduction of 100% of the adjusted | ||||||
25 | basis was taken in a taxable year ending on or | ||||||
26 | after December 31, 2021, "x" equals the |
| |||||||
| |||||||
1 | depreciation deduction that would be allowed | ||||||
2 | on that property if the taxpayer had made the | ||||||
3 | election under Section 168(k)(7) of the | ||||||
4 | Internal Revenue Code to not claim bonus | ||||||
5 | depreciation on that property; and | ||||||
6 | (iv) for property on which a bonus | ||||||
7 | depreciation deduction of a percentage other | ||||||
8 | than 30%, 50% or 100% of the adjusted basis | ||||||
9 | was taken in a taxable year ending on or after | ||||||
10 | December 31, 2021, "x" equals "y" multiplied | ||||||
11 | by 100 times the percentage bonus depreciation | ||||||
12 | on the property (that is, 100(bonus%)) and | ||||||
13 | then divided by 100 times 1 minus the | ||||||
14 | percentage bonus depreciation on the property | ||||||
15 | (that is, 100(1–bonus%)). | ||||||
16 | The aggregate amount deducted under this | ||||||
17 | subparagraph in all taxable
years for any one piece of | ||||||
18 | property may not exceed the amount of the bonus
| ||||||
19 | depreciation deduction
taken on that property on the | ||||||
20 | taxpayer's federal income tax return under
subsection | ||||||
21 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
22 | subparagraph (O) is exempt from the provisions of | ||||||
23 | Section 250; | ||||||
24 | (P) If the taxpayer sells, transfers, abandons, or | ||||||
25 | otherwise disposes of
property for which the taxpayer | ||||||
26 | was required in any taxable year to make an
addition |
| |||||||
| |||||||
1 | modification under subparagraph (D-5), then an amount | ||||||
2 | equal to that
addition modification. | ||||||
3 | If the taxpayer continues to own property through | ||||||
4 | the last day of the last tax year for which a | ||||||
5 | subtraction is allowed with respect to that property | ||||||
6 | under subparagraph (O) and for which the taxpayer was | ||||||
7 | required in any taxable year to make an addition | ||||||
8 | modification under subparagraph (D-5), then an amount | ||||||
9 | equal to that addition modification.
| ||||||
10 | The taxpayer is allowed to take the deduction | ||||||
11 | under this subparagraph
only once with respect to any | ||||||
12 | one piece of property. | ||||||
13 | This subparagraph (P) is exempt from the | ||||||
14 | provisions of Section 250; | ||||||
15 | (Q) The amount of (i) any interest income (net of | ||||||
16 | the deductions allocable thereto) taken into account | ||||||
17 | for the taxable year with respect to a transaction | ||||||
18 | with a taxpayer that is required to make an addition | ||||||
19 | modification with respect to such transaction under | ||||||
20 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
21 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
22 | the amount of such addition modification and
(ii) any | ||||||
23 | income from intangible property (net of the deductions | ||||||
24 | allocable thereto) taken into account for the taxable | ||||||
25 | year with respect to a transaction with a taxpayer | ||||||
26 | that is required to make an addition modification with |
| |||||||
| |||||||
1 | respect to such transaction under Section | ||||||
2 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
3 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
4 | addition modification. This subparagraph (Q) is exempt | ||||||
5 | from Section 250;
| ||||||
6 | (R) An amount equal to the interest income taken | ||||||
7 | into account for the taxable year (net of the | ||||||
8 | deductions allocable thereto) with respect to | ||||||
9 | transactions with (i) a foreign person who would be a | ||||||
10 | member of the taxpayer's unitary business group but | ||||||
11 | for the fact that the foreign person's business | ||||||
12 | activity outside the United States is 80% or more of | ||||||
13 | that person's total business activity and (ii) for | ||||||
14 | taxable years ending on or after December 31, 2008, to | ||||||
15 | a person who would be a member of the same unitary | ||||||
16 | business group but for the fact that the person is | ||||||
17 | prohibited under Section 1501(a)(27) from being | ||||||
18 | included in the unitary business group because he or | ||||||
19 | she is ordinarily required to apportion business | ||||||
20 | income under different subsections of Section 304, but | ||||||
21 | not to exceed the addition modification required to be | ||||||
22 | made for the same taxable year under Section | ||||||
23 | 203(d)(2)(D-7) for interest paid, accrued, or | ||||||
24 | incurred, directly or indirectly, to the same person. | ||||||
25 | This subparagraph (R) is exempt from Section 250; | ||||||
26 | (S) An amount equal to the income from intangible |
| |||||||
| |||||||
1 | property taken into account for the taxable year (net | ||||||
2 | of the deductions allocable thereto) with respect to | ||||||
3 | transactions with (i) a foreign person who would be a | ||||||
4 | member of the taxpayer's unitary business group but | ||||||
5 | for the fact that the foreign person's business | ||||||
6 | activity outside the United States is 80% or more of | ||||||
7 | that person's total business activity and (ii) for | ||||||
8 | taxable years ending on or after December 31, 2008, to | ||||||
9 | a person who would be a member of the same unitary | ||||||
10 | business group but for the fact that the person is | ||||||
11 | prohibited under Section 1501(a)(27) from being | ||||||
12 | included in the unitary business group because he or | ||||||
13 | she is ordinarily required to apportion business | ||||||
14 | income under different subsections of Section 304, but | ||||||
15 | not to exceed the addition modification required to be | ||||||
16 | made for the same taxable year under Section | ||||||
17 | 203(d)(2)(D-8) for intangible expenses and costs paid, | ||||||
18 | accrued, or incurred, directly or indirectly, to the | ||||||
19 | same person. This subparagraph (S) is exempt from | ||||||
20 | Section 250; and
| ||||||
21 | (T) For taxable years ending on or after December | ||||||
22 | 31, 2011, in the case of a taxpayer who was required to | ||||||
23 | add back any insurance premiums under Section | ||||||
24 | 203(d)(2)(D-9), such taxpayer may elect to subtract | ||||||
25 | that part of a reimbursement received from the | ||||||
26 | insurance company equal to the amount of the expense |
| |||||||
| |||||||
1 | or loss (including expenses incurred by the insurance | ||||||
2 | company) that would have been taken into account as a | ||||||
3 | deduction for federal income tax purposes if the | ||||||
4 | expense or loss had been uninsured. If a taxpayer | ||||||
5 | makes the election provided for by this subparagraph | ||||||
6 | (T), the insurer to which the premiums were paid must | ||||||
7 | add back to income the amount subtracted by the | ||||||
8 | taxpayer pursuant to this subparagraph (T). This | ||||||
9 | subparagraph (T) is exempt from the provisions of | ||||||
10 | Section 250. | ||||||
11 | (e) Gross income; adjusted gross income; taxable income. | ||||||
12 | (1) In general. Subject to the provisions of paragraph | ||||||
13 | (2) and
subsection (b)(3), for purposes of this Section | ||||||
14 | and Section 803(e), a
taxpayer's gross income, adjusted | ||||||
15 | gross income, or taxable income for
the taxable year shall | ||||||
16 | mean the amount of gross income, adjusted gross
income or | ||||||
17 | taxable income properly reportable for federal income tax
| ||||||
18 | purposes for the taxable year under the provisions of the | ||||||
19 | Internal
Revenue Code. Taxable income may be less than | ||||||
20 | zero. However, for taxable
years ending on or after | ||||||
21 | December 31, 1986, net operating loss
carryforwards from | ||||||
22 | taxable years ending prior to December 31, 1986, may not
| ||||||
23 | exceed the sum of federal taxable income for the taxable | ||||||
24 | year before net
operating loss deduction, plus the excess | ||||||
25 | of addition modifications over
subtraction modifications |
| |||||||
| |||||||
1 | for the taxable year. For taxable years ending
prior to | ||||||
2 | December 31, 1986, taxable income may never be an amount | ||||||
3 | in excess
of the net operating loss for the taxable year as | ||||||
4 | defined in subsections
(c) and (d) of Section 172 of the | ||||||
5 | Internal Revenue Code, provided that when
taxable income | ||||||
6 | of a corporation (other than a Subchapter S corporation),
| ||||||
7 | trust, or estate is less than zero and addition | ||||||
8 | modifications, other than
those provided by subparagraph | ||||||
9 | (E) of paragraph (2) of subsection (b) for
corporations or | ||||||
10 | subparagraph (E) of paragraph (2) of subsection (c) for
| ||||||
11 | trusts and estates, exceed subtraction modifications, an | ||||||
12 | addition
modification must be made under those | ||||||
13 | subparagraphs for any other taxable
year to which the | ||||||
14 | taxable income less than zero (net operating loss) is
| ||||||
15 | applied under Section 172 of the Internal Revenue Code or | ||||||
16 | under
subparagraph (E) of paragraph (2) of this subsection | ||||||
17 | (e) applied in
conjunction with Section 172 of the | ||||||
18 | Internal Revenue Code. | ||||||
19 | (2) Special rule. For purposes of paragraph (1) of | ||||||
20 | this subsection,
the taxable income properly reportable | ||||||
21 | for federal income tax purposes
shall mean: | ||||||
22 | (A) Certain life insurance companies. In the case | ||||||
23 | of a life
insurance company subject to the tax imposed | ||||||
24 | by Section 801 of the
Internal Revenue Code, life | ||||||
25 | insurance company taxable income, plus the
amount of | ||||||
26 | distribution from pre-1984 policyholder surplus |
| |||||||
| |||||||
1 | accounts as
calculated under Section 815a of the | ||||||
2 | Internal Revenue Code; | ||||||
3 | (B) Certain other insurance companies. In the case | ||||||
4 | of mutual
insurance companies subject to the tax | ||||||
5 | imposed by Section 831 of the
Internal Revenue Code, | ||||||
6 | insurance company taxable income; | ||||||
7 | (C) Regulated investment companies. In the case of | ||||||
8 | a regulated
investment company subject to the tax | ||||||
9 | imposed by Section 852 of the
Internal Revenue Code, | ||||||
10 | investment company taxable income; | ||||||
11 | (D) Real estate investment trusts. In the case of | ||||||
12 | a real estate
investment trust subject to the tax | ||||||
13 | imposed by Section 857 of the
Internal Revenue Code, | ||||||
14 | real estate investment trust taxable income; | ||||||
15 | (E) Consolidated corporations. In the case of a | ||||||
16 | corporation which
is a member of an affiliated group | ||||||
17 | of corporations filing a consolidated
income tax | ||||||
18 | return for the taxable year for federal income tax | ||||||
19 | purposes,
taxable income determined as if such | ||||||
20 | corporation had filed a separate
return for federal | ||||||
21 | income tax purposes for the taxable year and each
| ||||||
22 | preceding taxable year for which it was a member of an | ||||||
23 | affiliated group.
For purposes of this subparagraph, | ||||||
24 | the taxpayer's separate taxable
income shall be | ||||||
25 | determined as if the election provided by Section
| ||||||
26 | 243(b)(2) of the Internal Revenue Code had been in |
| |||||||
| |||||||
1 | effect for all such years; | ||||||
2 | (F) Cooperatives. In the case of a cooperative | ||||||
3 | corporation or
association, the taxable income of such | ||||||
4 | organization determined in
accordance with the | ||||||
5 | provisions of Section 1381 through 1388 of the
| ||||||
6 | Internal Revenue Code, but without regard to the | ||||||
7 | prohibition against offsetting losses from patronage | ||||||
8 | activities against income from nonpatronage | ||||||
9 | activities; except that a cooperative corporation or | ||||||
10 | association may make an election to follow its federal | ||||||
11 | income tax treatment of patronage losses and | ||||||
12 | nonpatronage losses. In the event such election is | ||||||
13 | made, such losses shall be computed and carried over | ||||||
14 | in a manner consistent with subsection (a) of Section | ||||||
15 | 207 of this Act and apportioned by the apportionment | ||||||
16 | factor reported by the cooperative on its Illinois | ||||||
17 | income tax return filed for the taxable year in which | ||||||
18 | the losses are incurred. The election shall be | ||||||
19 | effective for all taxable years with original returns | ||||||
20 | due on or after the date of the election. In addition, | ||||||
21 | the cooperative may file an amended return or returns, | ||||||
22 | as allowed under this Act, to provide that the | ||||||
23 | election shall be effective for losses incurred or | ||||||
24 | carried forward for taxable years occurring prior to | ||||||
25 | the date of the election. Once made, the election may | ||||||
26 | only be revoked upon approval of the Director. The |
| |||||||
| |||||||
1 | Department shall adopt rules setting forth | ||||||
2 | requirements for documenting the elections and any | ||||||
3 | resulting Illinois net loss and the standards to be | ||||||
4 | used by the Director in evaluating requests to revoke | ||||||
5 | elections. Public Act 96-932 is declaratory of | ||||||
6 | existing law; | ||||||
7 | (G) Subchapter S corporations. In the case of: (i) | ||||||
8 | a Subchapter S
corporation for which there is in | ||||||
9 | effect an election for the taxable year
under Section | ||||||
10 | 1362 of the Internal Revenue Code, the taxable income | ||||||
11 | of such
corporation determined in accordance with | ||||||
12 | Section 1363(b) of the Internal
Revenue Code, except | ||||||
13 | that taxable income shall take into
account those | ||||||
14 | items which are required by Section 1363(b)(1) of the
| ||||||
15 | Internal Revenue Code to be separately stated; and | ||||||
16 | (ii) a Subchapter
S corporation for which there is in | ||||||
17 | effect a federal election to opt out of
the provisions | ||||||
18 | of the Subchapter S Revision Act of 1982 and have | ||||||
19 | applied
instead the prior federal Subchapter S rules | ||||||
20 | as in effect on July 1, 1982,
the taxable income of | ||||||
21 | such corporation determined in accordance with the
| ||||||
22 | federal Subchapter S rules as in effect on July 1, | ||||||
23 | 1982; and | ||||||
24 | (H) Partnerships. In the case of a partnership, | ||||||
25 | taxable income
determined in accordance with Section | ||||||
26 | 703 of the Internal Revenue Code,
except that taxable |
| |||||||
| |||||||
1 | income shall take into account those items which are
| ||||||
2 | required by Section 703(a)(1) to be separately stated | ||||||
3 | but which would be
taken into account by an individual | ||||||
4 | in calculating his taxable income. | ||||||
5 | (3) Recapture of business expenses on disposition of | ||||||
6 | asset or business. Notwithstanding any other law to the | ||||||
7 | contrary, if in prior years income from an asset or | ||||||
8 | business has been classified as business income and in a | ||||||
9 | later year is demonstrated to be non-business income, then | ||||||
10 | all expenses, without limitation, deducted in such later | ||||||
11 | year and in the 2 immediately preceding taxable years | ||||||
12 | related to that asset or business that generated the | ||||||
13 | non-business income shall be added back and recaptured as | ||||||
14 | business income in the year of the disposition of the | ||||||
15 | asset or business. Such amount shall be apportioned to | ||||||
16 | Illinois using the greater of the apportionment fraction | ||||||
17 | computed for the business under Section 304 of this Act | ||||||
18 | for the taxable year or the average of the apportionment | ||||||
19 | fractions computed for the business under Section 304 of | ||||||
20 | this Act for the taxable year and for the 2 immediately | ||||||
21 | preceding taxable years.
| ||||||
22 | (f) Valuation limitation amount. | ||||||
23 | (1) In general. The valuation limitation amount | ||||||
24 | referred to in
subsections (a)(2)(G), (c)(2)(I) and | ||||||
25 | (d)(2)(E) is an amount equal to: |
| |||||||
| |||||||
1 | (A) The sum of the pre-August 1, 1969 appreciation | ||||||
2 | amounts (to the
extent consisting of gain reportable | ||||||
3 | under the provisions of Section
1245 or 1250 of the | ||||||
4 | Internal Revenue Code) for all property in respect
of | ||||||
5 | which such gain was reported for the taxable year; | ||||||
6 | plus | ||||||
7 | (B) The lesser of (i) the sum of the pre-August 1, | ||||||
8 | 1969 appreciation
amounts (to the extent consisting of | ||||||
9 | capital gain) for all property in
respect of which | ||||||
10 | such gain was reported for federal income tax purposes
| ||||||
11 | for the taxable year, or (ii) the net capital gain for | ||||||
12 | the taxable year,
reduced in either case by any amount | ||||||
13 | of such gain included in the amount
determined under | ||||||
14 | subsection (a)(2)(F) or (c)(2)(H). | ||||||
15 | (2) Pre-August 1, 1969 appreciation amount. | ||||||
16 | (A) If the fair market value of property referred | ||||||
17 | to in paragraph
(1) was readily ascertainable on | ||||||
18 | August 1, 1969, the pre-August 1, 1969
appreciation | ||||||
19 | amount for such property is the lesser of (i) the | ||||||
20 | excess of
such fair market value over the taxpayer's | ||||||
21 | basis (for determining gain)
for such property on that | ||||||
22 | date (determined under the Internal Revenue
Code as in | ||||||
23 | effect on that date), or (ii) the total gain realized | ||||||
24 | and
reportable for federal income tax purposes in | ||||||
25 | respect of the sale,
exchange or other disposition of | ||||||
26 | such property. |
| |||||||
| |||||||
1 | (B) If the fair market value of property referred | ||||||
2 | to in paragraph
(1) was not readily ascertainable on | ||||||
3 | August 1, 1969, the pre-August 1,
1969 appreciation | ||||||
4 | amount for such property is that amount which bears
| ||||||
5 | the same ratio to the total gain reported in respect of | ||||||
6 | the property for
federal income tax purposes for the | ||||||
7 | taxable year, as the number of full
calendar months in | ||||||
8 | that part of the taxpayer's holding period for the
| ||||||
9 | property ending July 31, 1969 bears to the number of | ||||||
10 | full calendar
months in the taxpayer's entire holding | ||||||
11 | period for the
property. | ||||||
12 | (C) The Department shall prescribe such | ||||||
13 | regulations as may be
necessary to carry out the | ||||||
14 | purposes of this paragraph. | ||||||
15 | (g) Double deductions. Unless specifically provided | ||||||
16 | otherwise, nothing
in this Section shall permit the same item | ||||||
17 | to be deducted more than once. | ||||||
18 | (h) Legislative intention. Except as expressly provided by | ||||||
19 | this
Section there shall be no modifications or limitations on | ||||||
20 | the amounts
of income, gain, loss or deduction taken into | ||||||
21 | account in determining
gross income, adjusted gross income or | ||||||
22 | taxable income for federal income
tax purposes for the taxable | ||||||
23 | year, or in the amount of such items
entering into the | ||||||
24 | computation of base income and net income under this
Act for |
| |||||||
| |||||||
1 | such taxable year, whether in respect of property values as of
| ||||||
2 | August 1, 1969 or otherwise. | ||||||
3 | (Source: P.A. 101-9, eff. 6-5-19; 101-81, eff. 7-12-19; | ||||||
4 | 102-16, eff. 6-17-21; 102-558, eff. 8-20-21; 102-658, eff. | ||||||
5 | 8-27-21; 102-813, eff. 5-13-22; 102-1112, eff. 12-21-22.) | ||||||
6 | (35 ILCS 5/234 new) | ||||||
7 | Sec. 234. The Endow Illinois tax credit. | ||||||
8 | (a) For taxable years ending on or after December 31, 2024 | ||||||
9 | and ending before January 1, 2034, each taxpayer for whom a tax | ||||||
10 | credit has been authorized by the Department of Revenue under | ||||||
11 | the Endow Illinois Tax Credit Act is entitled to a credit | ||||||
12 | against the tax imposed under subsections (a) and (b) of | ||||||
13 | Section 201 in an amount equal to the amount authorized under | ||||||
14 | that Act. | ||||||
15 | (b) For partners of partnerships and shareholders of | ||||||
16 | Subchapter S corporations, there is allowed a credit under | ||||||
17 | this Section to be determined in accordance with the | ||||||
18 | determination of income and distributive share of income under | ||||||
19 | Sections 702 and 704 and Subchapter S of the Internal Revenue | ||||||
20 | Code. | ||||||
21 | (c) The credit may not be carried back and may not reduce | ||||||
22 | the taxpayer's liability to less than zero. If the amount of | ||||||
23 | the credit exceeds the tax liability for the year, the excess | ||||||
24 | may be carried forward and applied to the tax liability of the | ||||||
25 | 5 taxable years following the excess credit year. The tax |
| |||||||
| |||||||
1 | credit shall be applied to the earliest year for which there is | ||||||
2 | a tax liability. If there are credits for more than one year | ||||||
3 | that are available to offset a liability, the earlier credit | ||||||
4 | shall be applied first.
| ||||||
5 | Section 999. Effective date. This Act takes effect upon | ||||||
6 | becoming law.
|