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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 5. The Illinois Estate and Generation-Skipping | |||||||||||||||||||
5 | Transfer Tax Act is amended by changing Section 2 as follows: | |||||||||||||||||||
6 | (35 ILCS 405/2) (from Ch. 120, par. 405A-2) | |||||||||||||||||||
7 | Sec. 2. Definitions. | |||||||||||||||||||
8 | "Federal estate tax" means the tax due to the United | |||||||||||||||||||
9 | States with respect to a taxable transfer under Chapter 11 of | |||||||||||||||||||
10 | the Internal Revenue Code. | |||||||||||||||||||
11 | "Federal generation-skipping transfer tax" means the tax | |||||||||||||||||||
12 | due to the United States with respect to a taxable transfer | |||||||||||||||||||
13 | under Chapter 13 of the Internal Revenue Code. | |||||||||||||||||||
14 | "Federal return" means the federal estate tax return with | |||||||||||||||||||
15 | respect to the federal estate tax and means the federal | |||||||||||||||||||
16 | generation-skipping transfer tax return with respect to the | |||||||||||||||||||
17 | federal generation-skipping transfer tax. | |||||||||||||||||||
18 | "Federal transfer tax" means the federal estate tax or the | |||||||||||||||||||
19 | federal generation-skipping transfer tax. | |||||||||||||||||||
20 | "Illinois estate tax" means the tax due to this State with | |||||||||||||||||||
21 | respect to a taxable transfer. | |||||||||||||||||||
22 | "Illinois generation-skipping transfer tax" means the tax | |||||||||||||||||||
23 | due to this State with respect to a taxable transfer that gives |
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1 | rise to a federal generation-skipping transfer tax. | ||||||
2 | "Illinois transfer tax" means the Illinois estate tax or | ||||||
3 | the Illinois generation-skipping transfer tax. | ||||||
4 | "Internal Revenue Code" means, unless otherwise provided, | ||||||
5 | the Internal Revenue Code of 1986, as amended from time to | ||||||
6 | time. | ||||||
7 | "Non-resident trust" means a trust that is not a resident | ||||||
8 | of this State for purposes of the Illinois Income Tax Act, as | ||||||
9 | amended from time to time. | ||||||
10 | "Person" means and includes any individual, trust, estate, | ||||||
11 | partnership, association, company or corporation. | ||||||
12 | "Qualified heir" means a qualified heir as defined in | ||||||
13 | Section 2032A(e)(1) of the Internal Revenue Code. | ||||||
14 | "Resident trust" means a trust that is a resident of this | ||||||
15 | State for purposes of the Illinois Income Tax Act, as amended | ||||||
16 | from time to time. | ||||||
17 | "State" means any state, territory or possession of the | ||||||
18 | United States and the District of Columbia. | ||||||
19 | "State tax credit" means: | ||||||
20 | (a) For persons dying on or after January 1, 2003 and | ||||||
21 | through December 31, 2005, an amount equal to the full credit | ||||||
22 | calculable under Section 2011 or Section 2604 of the Internal | ||||||
23 | Revenue Code as the credit would have been computed and | ||||||
24 | allowed under the Internal Revenue Code as in effect on | ||||||
25 | December 31, 2001, without the reduction in the State Death | ||||||
26 | Tax Credit as provided in Section 2011(b)(2) or the |
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1 | termination of the State Death Tax Credit as provided in | ||||||
2 | Section 2011(f) as enacted by the Economic Growth and Tax | ||||||
3 | Relief Reconciliation Act of 2001, but recognizing the | ||||||
4 | increased applicable exclusion amount through December 31, | ||||||
5 | 2005. | ||||||
6 | (b) For persons dying after December 31, 2005 and on or | ||||||
7 | before December 31, 2009, and for persons dying after December | ||||||
8 | 31, 2010, an amount equal to the full credit calculable under | ||||||
9 | Section 2011 or 2604 of the Internal Revenue Code as the credit | ||||||
10 | would have been computed and allowed under the Internal | ||||||
11 | Revenue Code as in effect on December 31, 2001, without the | ||||||
12 | reduction in the State Death Tax Credit as provided in Section | ||||||
13 | 2011(b)(2) or the termination of the State Death Tax Credit as | ||||||
14 | provided in Section 2011(f) as enacted by the Economic Growth | ||||||
15 | and Tax Relief Reconciliation Act of 2001, but with the | ||||||
16 | following modifications: | ||||||
17 | (1) the exclusion amount shall be: recognizing the | ||||||
18 | exclusion amount of only (i) | ||||||
19 | (A) $2,000,000 for persons dying prior to January | ||||||
20 | 1, 2012 ; , | ||||||
21 | (B) (ii) $3,500,000 for persons dying on or after | ||||||
22 | January 1, 2012 and prior to January 1, 2013 ; , and | ||||||
23 | (C) (iii) $4,000,000 for persons dying on or after | ||||||
24 | January 1, 2013 and before January 1, 2025; and | ||||||
25 | (D) for persons dying on or after January 1, 2025, | ||||||
26 | the applicable exclusion amount calculated under |
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1 | Section 2010 of the Internal Revenue Code, as that | ||||||
2 | Section exists on the effective date of this | ||||||
3 | amendatory Act of the 103rd General Assembly, | ||||||
4 | including the inflation adjustment under subparagraph | ||||||
5 | (B) of paragraph (3) of subsection (b) of that Section | ||||||
6 | and including any deceased spousal unused exclusion | ||||||
7 | amount available after a valid election is made under | ||||||
8 | subparagraph (A) of paragraph (5) of subsection (c) of | ||||||
9 | that Section; , and | ||||||
10 | (2) the State tax credit shall be calculated with a | ||||||
11 | reduction to the adjusted taxable estate for any qualified | ||||||
12 | terminable interest property election as defined in | ||||||
13 | subsection (b-1) of this Section. | ||||||
14 | (b-1) The person required to file the Illinois return may | ||||||
15 | elect on a timely filed Illinois return a marital deduction | ||||||
16 | for qualified terminable interest property under Section | ||||||
17 | 2056(b)(7) of the Internal Revenue Code for purposes of the | ||||||
18 | Illinois estate tax that is separate and independent of any | ||||||
19 | qualified terminable interest property election for federal | ||||||
20 | estate tax purposes. For purposes of the Illinois estate tax, | ||||||
21 | the inclusion of property in the gross estate of a surviving | ||||||
22 | spouse is the same as under Section 2044 of the Internal | ||||||
23 | Revenue Code. | ||||||
24 | In the case of any trust for which a State or federal | ||||||
25 | qualified terminable interest property election is made, the | ||||||
26 | trustee may not retain non-income producing assets for more |
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1 | than a reasonable amount of time without the consent of the | ||||||
2 | surviving spouse. | ||||||
3 | "Taxable transfer" means an event that gives rise to a | ||||||
4 | state tax credit, including any credit as a result of the | ||||||
5 | imposition of an additional tax under Section 2032A(c) of the | ||||||
6 | Internal Revenue Code. | ||||||
7 | "Transferee" means a transferee within the meaning of | ||||||
8 | Section 2603(a)(1) and Section 6901(h) of the Internal Revenue | ||||||
9 | Code. | ||||||
10 | "Transferred property" means: | ||||||
11 | (1) With respect to a taxable transfer occurring at | ||||||
12 | the death of an individual, the deceased individual's | ||||||
13 | gross estate as defined in Section 2031 of the Internal | ||||||
14 | Revenue Code. | ||||||
15 | (2) With respect to a taxable transfer occurring as a | ||||||
16 | result of a taxable termination as defined in Section | ||||||
17 | 2612(a) of the Internal Revenue Code, the taxable amount | ||||||
18 | determined under Section 2622(a) of the Internal Revenue | ||||||
19 | Code. | ||||||
20 | (3) With respect to a taxable transfer occurring as a | ||||||
21 | result of a taxable distribution as defined in Section | ||||||
22 | 2612(b) of the Internal Revenue Code, the taxable amount | ||||||
23 | determined under Section 2621(a) of the Internal Revenue | ||||||
24 | Code. | ||||||
25 | (4) With respect to an event which causes the | ||||||
26 | imposition of an additional estate tax under Section |
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1 | 2032A(c) of the Internal Revenue Code, the qualified real | ||||||
2 | property that was disposed of or which ceased to be used | ||||||
3 | for the qualified use, within the meaning of Section | ||||||
4 | 2032A(c)(1) of the Internal Revenue Code. | ||||||
5 | "Trust" includes a trust as defined in Section 2652(b)(1) | ||||||
6 | of the Internal Revenue Code. | ||||||
7 | (Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11; | ||||||
8 | 97-636, eff. 6-1-12 .) | ||||||
9 | Section 99. Effective date. This Act takes effect upon | ||||||
10 | becoming law. |