SB3329 103RD GENERAL ASSEMBLY

LRB103 39091 HLH 69229 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3329

Introduced 2/7/2024, by Sen. Omar Aquino

SYNOPSIS AS INTRODUCED:

35 ILCS 5/212.5 new

Amends the Illinois Income Tax Act. Creates a child tax credit in an amount equal to the product of a specified credit amount multiplied by the number of qualifying children of the taxpayer. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

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

Section 5. The Illinois Income Tax Act is amended by adding Section 212.5 as follows:

(35 ILCS 5/212.5 new)

Sec. 212.5. Child tax credit.

(a) For taxable years beginning on or after January 1, 2025, subject to the reduction set forth in subsection (b), each taxpayer is allowed a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to the product of the credit amount multiplied by the number of qualifying children of the taxpayer. To receive a credit, the taxpayer must be eligible for a credit under Section 32 of the Internal Revenue Code with respect to a qualifying child. However, a taxpayer is entitled to the credit under this Section regardless of whether or not the credit is disallowed under Section 32 of the Internal Revenue Code because the taxpayer has insufficient earned income.

(b) The credit under this Section shall be reduced by an amount equal to 2% of the portion of the taxpayer's earned income or adjusted gross income, whichever is greater, that exceeds the phaseout threshold.

(c) If the amount of the credit exceeds the income tax liability for the applicable tax year, then the excess credit shall be refunded to the taxpayer. The amount of the refund shall not be included in the taxpayer's income or resources for the purposes of determining eligibility or benefit level in any means-tested benefit program administered by a governmental entity unless required by federal law.

(d) As used in this Section:

"Consumer Price Index" means the index published by the Bureau of Labor Statistics of the United States Department of Labor that measures the average change in prices of goods and services purchased by all urban consumers, United States city average, all items, 1982-84 = 100.

"Credit amount" means:

(1) for taxable years beginning on or after January 1, 2025 and beginning before January 1, 2026, $300; and

(2) for taxable years beginning on or after January 1, 2026, the amount generated by multiplying the credit amount for the immediately preceding calendar year by one plus the percentage increase, if any, in the Consumer Price Index during the 12-month period ending in September of the previous calendar year and then rounding the product to the nearest $10.

By December 1, 2025, and by December 1 of each calendar year thereafter, the Department shall calculate the credit amount for the next calendar year and shall publish that credit amount on its website.

"Phaseout threshold" means:

(1) $75,000 for a married taxpayer filing a joint return; and

(2) $50,000 for all other filers.

"Qualifying child" has the meaning given in subsection (c) of Section 32 of the Internal Revenue Code, except that:

(1) the term excludes individuals who attain the age of 18 or greater during the taxable year; and

(2) subsection (m) of Section 32 of the Internal Revenue Code does not apply.

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

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