|
|||||||||||||||||||||||||
|
|||||||||||||||||||||||||
| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
1 | AN ACT concerning education.
| ||||||||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| ||||||||||||||||||||||||
3 | represented in the General Assembly:
| ||||||||||||||||||||||||
4 | Section 5. The State Finance Act is amended by adding | ||||||||||||||||||||||||
5 | Section 5.675 and 6z-69 as follows: | ||||||||||||||||||||||||
6 | (30 ILCS 105/5.675 new) | ||||||||||||||||||||||||
7 | Sec. 5.675. The School District Property Tax Relief Fund. | ||||||||||||||||||||||||
8 | (30 ILCS 105/6z-69 new)
| ||||||||||||||||||||||||
9 | Sec. 6z-69. School District Property Tax Relief Fund. | ||||||||||||||||||||||||
10 | (a) The School District property Tax Relief Fund is created | ||||||||||||||||||||||||
11 | as a special Fund in the State treasury. All interest earned on | ||||||||||||||||||||||||
12 | moneys in the Fund shall be deposited into the Fund. | ||||||||||||||||||||||||
13 | (b) As used in this Section: | ||||||||||||||||||||||||
14 | "Department" means the Department of Revenue. | ||||||||||||||||||||||||
15 | "Minimum property tax relief grant" means the minimum | ||||||||||||||||||||||||
16 | amount of
property tax relief that will be distributed to each | ||||||||||||||||||||||||
17 | school district from the School District Property Tax Relief | ||||||||||||||||||||||||
18 | Fund in each fiscal year. | ||||||||||||||||||||||||
19 | "High property tax effort school district" means each | ||||||||||||||||||||||||
20 | school district that
has a total tax rate that is in the top | ||||||||||||||||||||||||
21 | 25% of all total tax rates of all school districts. | ||||||||||||||||||||||||
22 | "Supplemental percentage" means the average daily head |
| |||||||
| |||||||
1 | count of a
particular high property tax effort school district | ||||||
2 | in a fiscal year, divided by the head count total for that | ||||||
3 | fiscal year. | ||||||
4 | "Head count total" means the aggregate average daily | ||||||
5 | attendance of all
high property tax effort school districts in | ||||||
6 | the applicable fiscal year. | ||||||
7 | "Supplemental property tax relief grant" means the amount | ||||||
8 | of property tax
relief granted to each high property tax effort | ||||||
9 | school district in each fiscal year that is in addition to the | ||||||
10 | minimum property tax relief grant that the district receives. | ||||||
11 | (c) Beginning in fiscal year 2008, the General Assembly | ||||||
12 | shall appropriate $2.4 billion from the education | ||||||
13 | appropriation minimum, as defined in Section 18-25 of the | ||||||
14 | School Code, to the School District Property Tax Relief Fund. | ||||||
15 | In each fiscal year thereafter, the General Assembly shall | ||||||
16 | appropriate an amount from the education appropriation | ||||||
17 | minimum, to the School District Property Tax Relief Fund equal | ||||||
18 | to the amount appropriated to the School District Property Tax | ||||||
19 | Relief Fund in the immediately preceding fiscal year, increased | ||||||
20 | by the Employment Cost Index ("ECI") published by the U.S. | ||||||
21 | Bureau of Labor Statistics for the immediately preceding fiscal | ||||||
22 | year. | ||||||
23 | (d) Between November 15 and 17 beginning in fiscal year | ||||||
24 | 2008 and for every year thereafter, the Department must | ||||||
25 | certify, no earlier than November 15 and no later than November | ||||||
26 | 17, the total amount of property tax relief each school |
| |||||||
| |||||||
1 | district will receive from the School District Property Tax | ||||||
2 | Relief Fund. The relief shall be determined as follows: | ||||||
3 | (1) In each fiscal year commencing with fiscal year | ||||||
4 | 2008, the General Assembly shall appropriate 80% of the | ||||||
5 | total amount appropriated to the School District Property | ||||||
6 | Tax Relief Fund for that fiscal year to fund the aggregate | ||||||
7 | amount of minimum property tax relief grants that will be | ||||||
8 | distributed to all school districts. The Department then | ||||||
9 | shall calculate the amount of minimum property tax relief | ||||||
10 | grant to be distributed to each school district in each | ||||||
11 | fiscal year as follows: | ||||||
12 | (A) for fiscal year 2008, each school district | ||||||
13 | shall receive a minimum property tax relief grant in an | ||||||
14 | amount equal to 20% of the total property taxes | ||||||
15 | reported as payable for that school district in fiscal | ||||||
16 | year 2002; and | ||||||
17 | (B) for each fiscal year thereafter, the minimum | ||||||
18 | property tax relief grant for each school district must | ||||||
19 | be increased by the percentage increase, if any, in the | ||||||
20 | ECI published for the prior fiscal year. | ||||||
21 | (2) In each fiscal year commencing with fiscal year | ||||||
22 | 2008, the General Assembly shall appropriate 20% of the | ||||||
23 | total amount appropriated to the School District Property | ||||||
24 | Tax Relief Fund for that fiscal year to fund the aggregate | ||||||
25 | amount of supplemental property tax relief grants that will | ||||||
26 | be distributed to all high property tax effort school |
| |||||||
| |||||||
1 | districts. The Department shall calculate the amount of | ||||||
2 | supplemental property tax relief grants payable to a | ||||||
3 | particular high property tax effort school district in each | ||||||
4 | fiscal year commencing in fiscal year 2008 and continuing | ||||||
5 | in each fiscal year thereafter by multiplying the | ||||||
6 | Supplemental Percentage of that high property tax effort | ||||||
7 | school district for that fiscal year by the total amount | ||||||
8 | appropriated to fund all the supplemental property tax | ||||||
9 | relief grants in that fiscal year. | ||||||
10 | Section 10. The Illinois Income Tax Act is amended by | ||||||
11 | changing Sections 201 and 203 and by adding Section 247 as | ||||||
12 | follows:
| ||||||
13 | (35 ILCS 5/201) (from Ch. 120, par. 2-201)
| ||||||
14 | Sec. 201. Tax Imposed.
| ||||||
15 | (a) In general. A tax measured by net income is hereby | ||||||
16 | imposed on every
individual, corporation, trust and estate for | ||||||
17 | each taxable year ending
after July 31, 1969 on the privilege | ||||||
18 | of earning or receiving income in or
as a resident of this | ||||||
19 | State. Such tax shall be in addition to all other
occupation or | ||||||
20 | privilege taxes imposed by this State or by any municipal
| ||||||
21 | corporation or political subdivision thereof.
| ||||||
22 | (b) Rates. The tax imposed by subsection (a) of this | ||||||
23 | Section shall be
determined as follows, except as adjusted by | ||||||
24 | subsection (d-1):
|
| |||||||
| |||||||
1 | (1) In the case of an individual, trust or estate, for | ||||||
2 | taxable years
ending prior to July 1, 1989, an amount equal | ||||||
3 | to 2 1/2% of the taxpayer's
net income for the taxable | ||||||
4 | year.
| ||||||
5 | (2) In the case of an individual, trust or estate, for | ||||||
6 | taxable years
beginning prior to July 1, 1989 and ending | ||||||
7 | after June 30, 1989, an amount
equal to the sum of (i) 2 | ||||||
8 | 1/2% of the taxpayer's net income for the period
prior to | ||||||
9 | July 1, 1989, as calculated under Section 202.3, and (ii) | ||||||
10 | 3% of the
taxpayer's net income for the period after June | ||||||
11 | 30, 1989, as calculated
under Section 202.3.
| ||||||
12 | (3) In the case of an individual, trust or estate, for | ||||||
13 | taxable years
beginning after June 30, 1989 and beginning | ||||||
14 | on or before January 1, 2007 , an amount equal to 3% of the | ||||||
15 | taxpayer's net
income for the taxable year.
| ||||||
16 | (4) In the case of an individual, trust or estate, for | ||||||
17 | taxable years
beginning after January 1, 2007, an amount | ||||||
18 | equal to 5% of the taxpayer's net
income for the taxable | ||||||
19 | year (Blank) .
| ||||||
20 | (5) (Blank).
| ||||||
21 | (6) In the case of a corporation, for taxable years
| ||||||
22 | ending prior to July 1, 1989, an amount equal to 4% of the
| ||||||
23 | taxpayer's net income for the taxable year.
| ||||||
24 | (7) In the case of a corporation, for taxable years | ||||||
25 | beginning prior to
July 1, 1989 and ending after June 30, | ||||||
26 | 1989, an amount equal to the sum of
(i) 4% of the |
| |||||||
| |||||||
1 | taxpayer's net income for the period prior to July 1, 1989,
| ||||||
2 | as calculated under Section 202.3, and (ii) 4.8% of the | ||||||
3 | taxpayer's net
income for the period after June 30, 1989, | ||||||
4 | as calculated under Section
202.3.
| ||||||
5 | (8) In the case of a corporation, for taxable years | ||||||
6 | beginning after
June 30, 1989 and beginning on or before | ||||||
7 | January 1, 2007 , an amount equal to 4.8% of the taxpayer's | ||||||
8 | net income for the
taxable year. | ||||||
9 | (9) In the case of a corporation, for taxable years | ||||||
10 | beginning after January 1, 2007, an amount equal to 8% of | ||||||
11 | the taxpayer's net income for the taxable year.
| ||||||
12 | (c) Personal Property Tax Replacement Income Tax.
| ||||||
13 | Beginning on July 1, 1979 and thereafter, in addition to such | ||||||
14 | income
tax, there is also hereby imposed the Personal Property | ||||||
15 | Tax Replacement
Income Tax measured by net income on every | ||||||
16 | corporation (including Subchapter
S corporations), partnership | ||||||
17 | and trust, for each taxable year ending after
June 30, 1979. | ||||||
18 | Such taxes are imposed on the privilege of earning or
receiving | ||||||
19 | income in or as a resident of this State. The Personal Property
| ||||||
20 | Tax Replacement Income Tax shall be in addition to the income | ||||||
21 | tax imposed
by subsections (a) and (b) of this Section and in | ||||||
22 | addition to all other
occupation or privilege taxes imposed by | ||||||
23 | this State or by any municipal
corporation or political | ||||||
24 | subdivision thereof.
| ||||||
25 | (d) Additional Personal Property Tax Replacement Income | ||||||
26 | Tax Rates.
The personal property tax replacement income tax |
| |||||||
| |||||||
1 | imposed by this subsection
and subsection (c) of this Section | ||||||
2 | in the case of a corporation, other
than a Subchapter S | ||||||
3 | corporation and except as adjusted by subsection (d-1),
shall | ||||||
4 | be an additional amount equal to
2.85% of such taxpayer's net | ||||||
5 | income for the taxable year, except that
beginning on January | ||||||
6 | 1, 1981, and thereafter, the rate of 2.85% specified
in this | ||||||
7 | subsection shall be reduced to 2.5%, and in the case of a
| ||||||
8 | partnership, trust or a Subchapter S corporation shall be an | ||||||
9 | additional
amount equal to 1.5% of such taxpayer's net income | ||||||
10 | for the taxable year.
| ||||||
11 | (d-1) Rate reduction for certain foreign insurers. In the | ||||||
12 | case of a
foreign insurer, as defined by Section 35A-5 of the | ||||||
13 | Illinois Insurance Code,
whose state or country of domicile | ||||||
14 | imposes on insurers domiciled in Illinois
a retaliatory tax | ||||||
15 | (excluding any insurer
whose premiums from reinsurance assumed | ||||||
16 | are 50% or more of its total insurance
premiums as determined | ||||||
17 | under paragraph (2) of subsection (b) of Section 304,
except | ||||||
18 | that for purposes of this determination premiums from | ||||||
19 | reinsurance do
not include premiums from inter-affiliate | ||||||
20 | reinsurance arrangements),
beginning with taxable years ending | ||||||
21 | on or after December 31, 1999,
the sum of
the rates of tax | ||||||
22 | imposed by subsections (b) and (d) shall be reduced (but not
| ||||||
23 | increased) to the rate at which the total amount of tax imposed | ||||||
24 | under this Act,
net of all credits allowed under this Act, | ||||||
25 | shall equal (i) the total amount of
tax that would be imposed | ||||||
26 | on the foreign insurer's net income allocable to
Illinois for |
| |||||||
| |||||||
1 | the taxable year by such foreign insurer's state or country of
| ||||||
2 | domicile if that net income were subject to all income taxes | ||||||
3 | and taxes
measured by net income imposed by such foreign | ||||||
4 | insurer's state or country of
domicile, net of all credits | ||||||
5 | allowed or (ii) a rate of zero if no such tax is
imposed on such | ||||||
6 | income by the foreign insurer's state of domicile.
For the | ||||||
7 | purposes of this subsection (d-1), an inter-affiliate includes | ||||||
8 | a
mutual insurer under common management.
| ||||||
9 | (1) For the purposes of subsection (d-1), in no event | ||||||
10 | shall the sum of the
rates of tax imposed by subsections | ||||||
11 | (b) and (d) be reduced below the rate at
which the sum of:
| ||||||
12 | (A) the total amount of tax imposed on such foreign | ||||||
13 | insurer under
this Act for a taxable year, net of all | ||||||
14 | credits allowed under this Act, plus
| ||||||
15 | (B) the privilege tax imposed by Section 409 of the | ||||||
16 | Illinois Insurance
Code, the fire insurance company | ||||||
17 | tax imposed by Section 12 of the Fire
Investigation | ||||||
18 | Act, and the fire department taxes imposed under | ||||||
19 | Section 11-10-1
of the Illinois Municipal Code,
| ||||||
20 | equals 1.25% for taxable years ending prior to December 31, | ||||||
21 | 2003, or
1.75% for taxable years ending on or after | ||||||
22 | December 31, 2003, of the net
taxable premiums written for | ||||||
23 | the taxable year,
as described by subsection (1) of Section | ||||||
24 | 409 of the Illinois Insurance Code.
This paragraph will in | ||||||
25 | no event increase the rates imposed under subsections
(b) | ||||||
26 | and (d).
|
| |||||||
| |||||||
1 | (2) Any reduction in the rates of tax imposed by this | ||||||
2 | subsection shall be
applied first against the rates imposed | ||||||
3 | by subsection (b) and only after the
tax imposed by | ||||||
4 | subsection (a) net of all credits allowed under this | ||||||
5 | Section
other than the credit allowed under subsection (i) | ||||||
6 | has been reduced to zero,
against the rates imposed by | ||||||
7 | subsection (d).
| ||||||
8 | This subsection (d-1) is exempt from the provisions of | ||||||
9 | Section 250.
| ||||||
10 | (e) Investment credit. A taxpayer shall be allowed a credit
| ||||||
11 | against the Personal Property Tax Replacement Income Tax for
| ||||||
12 | investment in qualified property.
| ||||||
13 | (1) A taxpayer shall be allowed a credit equal to .5% | ||||||
14 | of
the basis of qualified property placed in service during | ||||||
15 | the taxable year,
provided such property is placed in | ||||||
16 | service on or after
July 1, 1984. There shall be allowed an | ||||||
17 | additional credit equal
to .5% of the basis of qualified | ||||||
18 | property placed in service during the
taxable year, | ||||||
19 | provided such property is placed in service on or
after | ||||||
20 | July 1, 1986, and the taxpayer's base employment
within | ||||||
21 | Illinois has increased by 1% or more over the preceding | ||||||
22 | year as
determined by the taxpayer's employment records | ||||||
23 | filed with the
Illinois Department of Employment Security. | ||||||
24 | Taxpayers who are new to
Illinois shall be deemed to have | ||||||
25 | met the 1% growth in base employment for
the first year in | ||||||
26 | which they file employment records with the Illinois
|
| |||||||
| |||||||
1 | Department of Employment Security. The provisions added to | ||||||
2 | this Section by
Public Act 85-1200 (and restored by Public | ||||||
3 | Act 87-895) shall be
construed as declaratory of existing | ||||||
4 | law and not as a new enactment. If,
in any year, the | ||||||
5 | increase in base employment within Illinois over the
| ||||||
6 | preceding year is less than 1%, the additional credit shall | ||||||
7 | be limited to that
percentage times a fraction, the | ||||||
8 | numerator of which is .5% and the denominator
of which is | ||||||
9 | 1%, but shall not exceed .5%. The investment credit shall | ||||||
10 | not be
allowed to the extent that it would reduce a | ||||||
11 | taxpayer's liability in any tax
year below zero, nor may | ||||||
12 | any credit for qualified property be allowed for any
year | ||||||
13 | other than the year in which the property was placed in | ||||||
14 | service in
Illinois. For tax years ending on or after | ||||||
15 | December 31, 1987, and on or
before December 31, 1988, the | ||||||
16 | credit shall be allowed for the tax year in
which the | ||||||
17 | property is placed in service, or, if the amount of the | ||||||
18 | credit
exceeds the tax liability for that year, whether it | ||||||
19 | exceeds the original
liability or the liability as later | ||||||
20 | amended, such excess may be carried
forward and applied to | ||||||
21 | the tax liability of the 5 taxable years following
the | ||||||
22 | excess credit years if the taxpayer (i) makes investments | ||||||
23 | which cause
the creation of a minimum of 2,000 full-time | ||||||
24 | equivalent jobs in Illinois,
(ii) is located in an | ||||||
25 | enterprise zone established pursuant to the Illinois
| ||||||
26 | Enterprise Zone Act and (iii) is certified by the |
| |||||||
| |||||||
1 | Department of Commerce
and Community Affairs (now | ||||||
2 | Department of Commerce and Economic Opportunity) as | ||||||
3 | complying with the requirements specified in
clause (i) and | ||||||
4 | (ii) by July 1, 1986. The Department of Commerce and
| ||||||
5 | Community Affairs (now Department of Commerce and Economic | ||||||
6 | Opportunity) shall notify the Department of Revenue of all | ||||||
7 | such
certifications immediately. For tax years ending | ||||||
8 | after December 31, 1988,
the credit shall be allowed for | ||||||
9 | the tax year in which the property is
placed in service, | ||||||
10 | or, if the amount of the credit exceeds the tax
liability | ||||||
11 | for that year, whether it exceeds the original liability or | ||||||
12 | the
liability as later amended, such excess may be carried | ||||||
13 | forward and applied
to the tax liability of the 5 taxable | ||||||
14 | years following the excess credit
years. The credit shall | ||||||
15 | be applied to the earliest year for which there is
a | ||||||
16 | liability. If there is credit from more than one tax year | ||||||
17 | that is
available to offset a liability, earlier credit | ||||||
18 | shall be applied first.
| ||||||
19 | (2) The term "qualified property" means property | ||||||
20 | which:
| ||||||
21 | (A) is tangible, whether new or used, including | ||||||
22 | buildings and structural
components of buildings and | ||||||
23 | signs that are real property, but not including
land or | ||||||
24 | improvements to real property that are not a structural | ||||||
25 | component of a
building such as landscaping, sewer | ||||||
26 | lines, local access roads, fencing, parking
lots, and |
| |||||||
| |||||||
1 | other appurtenances;
| ||||||
2 | (B) is depreciable pursuant to Section 167 of the | ||||||
3 | Internal Revenue Code,
except that "3-year property" | ||||||
4 | as defined in Section 168(c)(2)(A) of that
Code is not | ||||||
5 | eligible for the credit provided by this subsection | ||||||
6 | (e);
| ||||||
7 | (C) is acquired by purchase as defined in Section | ||||||
8 | 179(d) of
the Internal Revenue Code;
| ||||||
9 | (D) is used in Illinois by a taxpayer who is | ||||||
10 | primarily engaged in
manufacturing, or in mining coal | ||||||
11 | or fluorite, or in retailing, or was placed in service | ||||||
12 | on or after July 1, 2006 in a River Edge Redevelopment | ||||||
13 | Zone established pursuant to the River Edge | ||||||
14 | Redevelopment Zone Act; and
| ||||||
15 | (E) has not previously been used in Illinois in | ||||||
16 | such a manner and by
such a person as would qualify for | ||||||
17 | the credit provided by this subsection
(e) or | ||||||
18 | subsection (f).
| ||||||
19 | (3) For purposes of this subsection (e), | ||||||
20 | "manufacturing" means
the material staging and production | ||||||
21 | of tangible personal property by
procedures commonly | ||||||
22 | regarded as manufacturing, processing, fabrication, or
| ||||||
23 | assembling which changes some existing material into new | ||||||
24 | shapes, new
qualities, or new combinations. For purposes of | ||||||
25 | this subsection
(e) the term "mining" shall have the same | ||||||
26 | meaning as the term "mining" in
Section 613(c) of the |
| |||||||
| |||||||
1 | Internal Revenue Code. For purposes of this subsection
(e), | ||||||
2 | the term "retailing" means the sale of tangible personal | ||||||
3 | property or
services rendered in conjunction with the sale | ||||||
4 | of tangible consumer goods
or commodities.
| ||||||
5 | (4) The basis of qualified property shall be the basis
| ||||||
6 | used to compute the depreciation deduction for federal | ||||||
7 | income tax purposes.
| ||||||
8 | (5) If the basis of the property for federal income tax | ||||||
9 | depreciation
purposes is increased after it has been placed | ||||||
10 | in service in Illinois by
the taxpayer, the amount of such | ||||||
11 | increase shall be deemed property placed
in service on the | ||||||
12 | date of such increase in basis.
| ||||||
13 | (6) The term "placed in service" shall have the same
| ||||||
14 | meaning as under Section 46 of the Internal Revenue Code.
| ||||||
15 | (7) If during any taxable year, any property ceases to
| ||||||
16 | be qualified property in the hands of the taxpayer within | ||||||
17 | 48 months after
being placed in service, or the situs of | ||||||
18 | any qualified property is
moved outside Illinois within 48 | ||||||
19 | months after being placed in service, the
Personal Property | ||||||
20 | Tax Replacement Income Tax for such taxable year shall be
| ||||||
21 | increased. Such increase shall be determined by (i) | ||||||
22 | recomputing the
investment credit which would have been | ||||||
23 | allowed for the year in which
credit for such property was | ||||||
24 | originally allowed by eliminating such
property from such | ||||||
25 | computation and, (ii) subtracting such recomputed credit
| ||||||
26 | from the amount of credit previously allowed. For the |
| |||||||
| |||||||
1 | purposes of this
paragraph (7), a reduction of the basis of | ||||||
2 | qualified property resulting
from a redetermination of the | ||||||
3 | purchase price shall be deemed a disposition
of qualified | ||||||
4 | property to the extent of such reduction.
| ||||||
5 | (8) Unless the investment credit is extended by law, | ||||||
6 | the
basis of qualified property shall not include costs | ||||||
7 | incurred after
December 31, 2008, except for costs incurred | ||||||
8 | pursuant to a binding
contract entered into on or before | ||||||
9 | December 31, 2008.
| ||||||
10 | (9) Each taxable year ending before December 31, 2000, | ||||||
11 | a partnership may
elect to pass through to its
partners the | ||||||
12 | credits to which the partnership is entitled under this | ||||||
13 | subsection
(e) for the taxable year. A partner may use the | ||||||
14 | credit allocated to him or her
under this paragraph only | ||||||
15 | against the tax imposed in subsections (c) and (d) of
this | ||||||
16 | Section. If the partnership makes that election, those | ||||||
17 | credits shall be
allocated among the partners in the | ||||||
18 | partnership in accordance with the rules
set forth in | ||||||
19 | Section 704(b) of the Internal Revenue Code, and the rules
| ||||||
20 | promulgated under that Section, and the allocated amount of | ||||||
21 | the credits shall
be allowed to the partners for that | ||||||
22 | taxable year. The partnership shall make
this election on | ||||||
23 | its Personal Property Tax Replacement Income Tax return for
| ||||||
24 | that taxable year. The election to pass through the credits | ||||||
25 | shall be
irrevocable.
| ||||||
26 | For taxable years ending on or after December 31, 2000, |
| |||||||
| |||||||
1 | a
partner that qualifies its
partnership for a subtraction | ||||||
2 | under subparagraph (I) of paragraph (2) of
subsection (d) | ||||||
3 | of Section 203 or a shareholder that qualifies a Subchapter | ||||||
4 | S
corporation for a subtraction under subparagraph (S) of | ||||||
5 | paragraph (2) of
subsection (b) of Section 203 shall be | ||||||
6 | allowed a credit under this subsection
(e) equal to its | ||||||
7 | share of the credit earned under this subsection (e) during
| ||||||
8 | the taxable year by the partnership or Subchapter S | ||||||
9 | corporation, determined in
accordance with the | ||||||
10 | determination of income and distributive share of
income | ||||||
11 | under Sections 702 and 704 and Subchapter S of the Internal | ||||||
12 | Revenue
Code. This paragraph is exempt from the provisions | ||||||
13 | of Section 250.
| ||||||
14 | (f) Investment credit; Enterprise Zone; River Edge | ||||||
15 | Redevelopment Zone.
| ||||||
16 | (1) A taxpayer shall be allowed a credit against the | ||||||
17 | tax imposed
by subsections (a) and (b) of this Section for | ||||||
18 | investment in qualified
property which is placed in service | ||||||
19 | in an Enterprise Zone created
pursuant to the Illinois | ||||||
20 | Enterprise Zone Act or, for property placed in service on | ||||||
21 | or after July 1, 2006, a River Edge Redevelopment Zone | ||||||
22 | established pursuant to the River Edge Redevelopment Zone | ||||||
23 | Act. For partners, shareholders
of Subchapter S | ||||||
24 | corporations, and owners of limited liability companies,
| ||||||
25 | if the liability company is treated as a partnership for | ||||||
26 | purposes of
federal and State income taxation, there shall |
| |||||||
| |||||||
1 | be allowed a credit under
this subsection (f) to be | ||||||
2 | determined in accordance with the determination
of income | ||||||
3 | and distributive share of income under Sections 702 and 704 | ||||||
4 | and
Subchapter S of the Internal Revenue Code. The credit | ||||||
5 | shall be .5% of the
basis for such property. The credit | ||||||
6 | shall be available only in the taxable
year in which the | ||||||
7 | property is placed in service in the Enterprise Zone or | ||||||
8 | River Edge Redevelopment Zone and
shall not be allowed to | ||||||
9 | the extent that it would reduce a taxpayer's
liability for | ||||||
10 | the tax imposed by subsections (a) and (b) of this Section | ||||||
11 | to
below zero. For tax years ending on or after December | ||||||
12 | 31, 1985, the credit
shall be allowed for the tax year in | ||||||
13 | which the property is placed in
service, or, if the amount | ||||||
14 | of the credit exceeds the tax liability for that
year, | ||||||
15 | whether it exceeds the original liability or the liability | ||||||
16 | as later
amended, such excess may be carried forward and | ||||||
17 | applied to the tax
liability of the 5 taxable years | ||||||
18 | following the excess credit year.
The credit shall be | ||||||
19 | applied to the earliest year for which there is a
| ||||||
20 | liability. If there is credit from more than one tax year | ||||||
21 | that is available
to offset a liability, the credit | ||||||
22 | accruing first in time shall be applied
first.
| ||||||
23 | (2) The term qualified property means property which:
| ||||||
24 | (A) is tangible, whether new or used, including | ||||||
25 | buildings and
structural components of buildings;
| ||||||
26 | (B) is depreciable pursuant to Section 167 of the |
| |||||||
| |||||||
1 | Internal Revenue
Code, except that "3-year property" | ||||||
2 | as defined in Section 168(c)(2)(A) of
that Code is not | ||||||
3 | eligible for the credit provided by this subsection | ||||||
4 | (f);
| ||||||
5 | (C) is acquired by purchase as defined in Section | ||||||
6 | 179(d) of
the Internal Revenue Code;
| ||||||
7 | (D) is used in the Enterprise Zone or River Edge | ||||||
8 | Redevelopment Zone by the taxpayer; and
| ||||||
9 | (E) has not been previously used in Illinois in | ||||||
10 | such a manner and by
such a person as would qualify for | ||||||
11 | the credit provided by this subsection
(f) or | ||||||
12 | subsection (e).
| ||||||
13 | (3) The basis of qualified property shall be the basis | ||||||
14 | used to compute
the depreciation deduction for federal | ||||||
15 | income tax purposes.
| ||||||
16 | (4) If the basis of the property for federal income tax | ||||||
17 | depreciation
purposes is increased after it has been placed | ||||||
18 | in service in the Enterprise
Zone or River Edge | ||||||
19 | Redevelopment Zone by the taxpayer, the amount of such | ||||||
20 | increase shall be deemed property
placed in service on the | ||||||
21 | date of such increase in basis.
| ||||||
22 | (5) The term "placed in service" shall have the same | ||||||
23 | meaning as under
Section 46 of the Internal Revenue Code.
| ||||||
24 | (6) If during any taxable year, any property ceases to | ||||||
25 | be qualified
property in the hands of the taxpayer within | ||||||
26 | 48 months after being placed
in service, or the situs of |
| |||||||
| |||||||
1 | any qualified property is moved outside the
Enterprise Zone | ||||||
2 | or River Edge Redevelopment Zone within 48 months after | ||||||
3 | being placed in service, the tax
imposed under subsections | ||||||
4 | (a) and (b) of this Section for such taxable year
shall be | ||||||
5 | increased. Such increase shall be determined by (i) | ||||||
6 | recomputing
the investment credit which would have been | ||||||
7 | allowed for the year in which
credit for such property was | ||||||
8 | originally allowed by eliminating such
property from such | ||||||
9 | computation, and (ii) subtracting such recomputed credit
| ||||||
10 | from the amount of credit previously allowed. For the | ||||||
11 | purposes of this
paragraph (6), a reduction of the basis of | ||||||
12 | qualified property resulting
from a redetermination of the | ||||||
13 | purchase price shall be deemed a disposition
of qualified | ||||||
14 | property to the extent of such reduction.
| ||||||
15 | (7) There shall be allowed an additional credit equal | ||||||
16 | to 0.5% of the basis of qualified property placed in | ||||||
17 | service during the taxable year in a River Edge | ||||||
18 | Redevelopment Zone, provided such property is placed in | ||||||
19 | service on or after July 1, 2006, and the taxpayer's base | ||||||
20 | employment within Illinois has increased by 1% or more over | ||||||
21 | the preceding year as determined by the taxpayer's | ||||||
22 | employment records filed with the Illinois Department of | ||||||
23 | Employment Security. Taxpayers who are new to Illinois | ||||||
24 | shall be deemed to have met the 1% growth in base | ||||||
25 | employment for the first year in which they file employment | ||||||
26 | records with the Illinois Department of Employment |
| |||||||
| |||||||
1 | Security. If, in any year, the increase in base employment | ||||||
2 | within Illinois over the preceding year is less than 1%, | ||||||
3 | the additional credit shall be limited to that percentage | ||||||
4 | times a fraction, the numerator of which is 0.5% and the | ||||||
5 | denominator of which is 1%, but shall not exceed 0.5%.
| ||||||
6 | (g) Jobs Tax Credit; Enterprise Zone, River Edge | ||||||
7 | Redevelopment Zone, and Foreign Trade Zone or Sub-Zone.
| ||||||
8 | (1) A taxpayer conducting a trade or business in an | ||||||
9 | enterprise zone
or a High Impact Business designated by the | ||||||
10 | Department of Commerce and
Economic Opportunity or for | ||||||
11 | taxable years ending on or after December 31, 2006, in a | ||||||
12 | River Edge Redevelopment Zone conducting a trade or | ||||||
13 | business in a federally designated
Foreign Trade Zone or | ||||||
14 | Sub-Zone shall be allowed a credit against the tax
imposed | ||||||
15 | by subsections (a) and (b) of this Section in the amount of | ||||||
16 | $500
per eligible employee hired to work in the zone during | ||||||
17 | the taxable year.
| ||||||
18 | (2) To qualify for the credit:
| ||||||
19 | (A) the taxpayer must hire 5 or more eligible | ||||||
20 | employees to work in an
enterprise zone, River Edge | ||||||
21 | Redevelopment Zone, or federally designated Foreign | ||||||
22 | Trade Zone or Sub-Zone
during the taxable year;
| ||||||
23 | (B) the taxpayer's total employment within the | ||||||
24 | enterprise zone, River Edge Redevelopment Zone, or
| ||||||
25 | federally designated Foreign Trade Zone or Sub-Zone | ||||||
26 | must
increase by 5 or more full-time employees beyond |
| |||||||
| |||||||
1 | the total employed in that
zone at the end of the | ||||||
2 | previous tax year for which a jobs tax
credit under | ||||||
3 | this Section was taken, or beyond the total employed by | ||||||
4 | the
taxpayer as of December 31, 1985, whichever is | ||||||
5 | later; and
| ||||||
6 | (C) the eligible employees must be employed 180 | ||||||
7 | consecutive days in
order to be deemed hired for | ||||||
8 | purposes of this subsection.
| ||||||
9 | (3) An "eligible employee" means an employee who is:
| ||||||
10 | (A) Certified by the Department of Commerce and | ||||||
11 | Economic Opportunity
as "eligible for services" | ||||||
12 | pursuant to regulations promulgated in
accordance with | ||||||
13 | Title II of the Job Training Partnership Act, Training
| ||||||
14 | Services for the Disadvantaged or Title III of the Job | ||||||
15 | Training Partnership
Act, Employment and Training | ||||||
16 | Assistance for Dislocated Workers Program.
| ||||||
17 | (B) Hired after the enterprise zone, River Edge | ||||||
18 | Redevelopment Zone, or federally designated Foreign
| ||||||
19 | Trade Zone or Sub-Zone was designated or the trade or
| ||||||
20 | business was located in that zone, whichever is later.
| ||||||
21 | (C) Employed in the enterprise zone, River Edge | ||||||
22 | Redevelopment Zone, or Foreign Trade Zone or
Sub-Zone. | ||||||
23 | An employee is employed in an
enterprise zone or | ||||||
24 | federally designated Foreign Trade Zone or Sub-Zone
if | ||||||
25 | his services are rendered there or it is the base of
| ||||||
26 | operations for the services performed.
|
| |||||||
| |||||||
1 | (D) A full-time employee working 30 or more hours | ||||||
2 | per week.
| ||||||
3 | (4) For tax years ending on or after December 31, 1985 | ||||||
4 | and prior to
December 31, 1988, the credit shall be allowed | ||||||
5 | for the tax year in which
the eligible employees are hired. | ||||||
6 | For tax years ending on or after
December 31, 1988, the | ||||||
7 | credit shall be allowed for the tax year immediately
| ||||||
8 | following the tax year in which the eligible employees are | ||||||
9 | hired. If the
amount of the credit exceeds the tax | ||||||
10 | liability for that year, whether it
exceeds the original | ||||||
11 | liability or the liability as later amended, such
excess | ||||||
12 | may be carried forward and applied to the tax liability of | ||||||
13 | the 5
taxable years following the excess credit year. The | ||||||
14 | credit shall be
applied to the earliest year for which | ||||||
15 | there is a liability. If there is
credit from more than one | ||||||
16 | tax year that is available to offset a liability,
earlier | ||||||
17 | credit shall be applied first.
| ||||||
18 | (5) The Department of Revenue shall promulgate such | ||||||
19 | rules and regulations
as may be deemed necessary to carry | ||||||
20 | out the purposes of this subsection (g).
| ||||||
21 | (6) The credit shall be available for eligible | ||||||
22 | employees hired on or
after January 1, 1986.
| ||||||
23 | (h) Investment credit; High Impact Business.
| ||||||
24 | (1) Subject to subsections (b) and (b-5) of Section
5.5 | ||||||
25 | of the Illinois Enterprise Zone Act, a taxpayer shall be | ||||||
26 | allowed a credit
against the tax imposed by subsections (a) |
| |||||||
| |||||||
1 | and (b) of this Section for
investment in qualified
| ||||||
2 | property which is placed in service by a Department of | ||||||
3 | Commerce and Economic Opportunity
designated High Impact | ||||||
4 | Business. The credit shall be .5% of the basis
for such | ||||||
5 | property. The credit shall not be available (i) until the | ||||||
6 | minimum
investments in qualified property set forth in | ||||||
7 | subdivision (a)(3)(A) of
Section 5.5 of the Illinois
| ||||||
8 | Enterprise Zone Act have been satisfied
or (ii) until the | ||||||
9 | time authorized in subsection (b-5) of the Illinois
| ||||||
10 | Enterprise Zone Act for entities designated as High Impact | ||||||
11 | Businesses under
subdivisions (a)(3)(B), (a)(3)(C), and | ||||||
12 | (a)(3)(D) of Section 5.5 of the Illinois
Enterprise Zone | ||||||
13 | Act, and shall not be allowed to the extent that it would
| ||||||
14 | reduce a taxpayer's liability for the tax imposed by | ||||||
15 | subsections (a) and (b) of
this Section to below zero. The | ||||||
16 | credit applicable to such investments shall be
taken in the | ||||||
17 | taxable year in which such investments have been completed. | ||||||
18 | The
credit for additional investments beyond the minimum | ||||||
19 | investment by a designated
high impact business authorized | ||||||
20 | under subdivision (a)(3)(A) of Section 5.5 of
the Illinois | ||||||
21 | Enterprise Zone Act shall be available only in the taxable | ||||||
22 | year in
which the property is placed in service and shall | ||||||
23 | not be allowed to the extent
that it would reduce a | ||||||
24 | taxpayer's liability for the tax imposed by subsections
(a) | ||||||
25 | and (b) of this Section to below zero.
For tax years ending | ||||||
26 | on or after December 31, 1987, the credit shall be
allowed |
| |||||||
| |||||||
1 | for the tax year in which the property is placed in | ||||||
2 | service, or, if
the amount of the credit exceeds the tax | ||||||
3 | liability for that year, whether
it exceeds the original | ||||||
4 | liability or the liability as later amended, such
excess | ||||||
5 | may be carried forward and applied to the tax liability of | ||||||
6 | the 5
taxable years following the excess credit year. The | ||||||
7 | credit shall be
applied to the earliest year for which | ||||||
8 | there is a liability. If there is
credit from more than one | ||||||
9 | tax year that is available to offset a liability,
the | ||||||
10 | credit accruing first in time shall be applied first.
| ||||||
11 | Changes made in this subdivision (h)(1) by Public Act | ||||||
12 | 88-670
restore changes made by Public Act 85-1182 and | ||||||
13 | reflect existing law.
| ||||||
14 | (2) The term qualified property means property which:
| ||||||
15 | (A) is tangible, whether new or used, including | ||||||
16 | buildings and
structural components of buildings;
| ||||||
17 | (B) is depreciable pursuant to Section 167 of the | ||||||
18 | Internal Revenue
Code, except that "3-year property" | ||||||
19 | as defined in Section 168(c)(2)(A) of
that Code is not | ||||||
20 | eligible for the credit provided by this subsection | ||||||
21 | (h);
| ||||||
22 | (C) is acquired by purchase as defined in Section | ||||||
23 | 179(d) of the
Internal Revenue Code; and
| ||||||
24 | (D) is not eligible for the Enterprise Zone | ||||||
25 | Investment Credit provided
by subsection (f) of this | ||||||
26 | Section.
|
| |||||||
| |||||||
1 | (3) The basis of qualified property shall be the basis | ||||||
2 | used to compute
the depreciation deduction for federal | ||||||
3 | income tax purposes.
| ||||||
4 | (4) If the basis of the property for federal income tax | ||||||
5 | depreciation
purposes is increased after it has been placed | ||||||
6 | in service in a federally
designated Foreign Trade Zone or | ||||||
7 | Sub-Zone located in Illinois by the taxpayer,
the amount of | ||||||
8 | such increase shall be deemed property placed in service on
| ||||||
9 | the date of such increase in basis.
| ||||||
10 | (5) The term "placed in service" shall have the same | ||||||
11 | meaning as under
Section 46 of the Internal Revenue Code.
| ||||||
12 | (6) If during any taxable year ending on or before | ||||||
13 | December 31, 1996,
any property ceases to be qualified
| ||||||
14 | property in the hands of the taxpayer within 48 months | ||||||
15 | after being placed
in service, or the situs of any | ||||||
16 | qualified property is moved outside
Illinois within 48 | ||||||
17 | months after being placed in service, the tax imposed
under | ||||||
18 | subsections (a) and (b) of this Section for such taxable | ||||||
19 | year shall
be increased. Such increase shall be determined | ||||||
20 | by (i) recomputing the
investment credit which would have | ||||||
21 | been allowed for the year in which
credit for such property | ||||||
22 | was originally allowed by eliminating such
property from | ||||||
23 | such computation, and (ii) subtracting such recomputed | ||||||
24 | credit
from the amount of credit previously allowed. For | ||||||
25 | the purposes of this
paragraph (6), a reduction of the | ||||||
26 | basis of qualified property resulting
from a |
| |||||||
| |||||||
1 | redetermination of the purchase price shall be deemed a | ||||||
2 | disposition
of qualified property to the extent of such | ||||||
3 | reduction.
| ||||||
4 | (7) Beginning with tax years ending after December 31, | ||||||
5 | 1996, if a
taxpayer qualifies for the credit under this | ||||||
6 | subsection (h) and thereby is
granted a tax abatement and | ||||||
7 | the taxpayer relocates its entire facility in
violation of | ||||||
8 | the explicit terms and length of the contract under Section
| ||||||
9 | 18-183 of the Property Tax Code, the tax imposed under | ||||||
10 | subsections
(a) and (b) of this Section shall be increased | ||||||
11 | for the taxable year
in which the taxpayer relocated its | ||||||
12 | facility by an amount equal to the
amount of credit | ||||||
13 | received by the taxpayer under this subsection (h).
| ||||||
14 | (i) Credit for Personal Property Tax Replacement Income | ||||||
15 | Tax.
For tax years ending prior to December 31, 2003, a credit | ||||||
16 | shall be allowed
against the tax imposed by
subsections (a) and | ||||||
17 | (b) of this Section for the tax imposed by subsections (c)
and | ||||||
18 | (d) of this Section. This credit shall be computed by | ||||||
19 | multiplying the tax
imposed by subsections (c) and (d) of this | ||||||
20 | Section by a fraction, the numerator
of which is base income | ||||||
21 | allocable to Illinois and the denominator of which is
Illinois | ||||||
22 | base income, and further multiplying the product by the tax | ||||||
23 | rate
imposed by subsections (a) and (b) of this Section.
| ||||||
24 | Any credit earned on or after December 31, 1986 under
this | ||||||
25 | subsection which is unused in the year
the credit is computed | ||||||
26 | because it exceeds the tax liability imposed by
subsections (a) |
| |||||||
| |||||||
1 | and (b) for that year (whether it exceeds the original
| ||||||
2 | liability or the liability as later amended) may be carried | ||||||
3 | forward and
applied to the tax liability imposed by subsections | ||||||
4 | (a) and (b) of the 5
taxable years following the excess credit | ||||||
5 | year, provided that no credit may
be carried forward to any | ||||||
6 | year ending on or
after December 31, 2003. This credit shall be
| ||||||
7 | applied first to the earliest year for which there is a | ||||||
8 | liability. If
there is a credit under this subsection from more | ||||||
9 | than one tax year that is
available to offset a liability the | ||||||
10 | earliest credit arising under this
subsection shall be applied | ||||||
11 | first.
| ||||||
12 | If, during any taxable year ending on or after December 31, | ||||||
13 | 1986, the
tax imposed by subsections (c) and (d) of this | ||||||
14 | Section for which a taxpayer
has claimed a credit under this | ||||||
15 | subsection (i) is reduced, the amount of
credit for such tax | ||||||
16 | shall also be reduced. Such reduction shall be
determined by | ||||||
17 | recomputing the credit to take into account the reduced tax
| ||||||
18 | imposed by subsections (c) and (d). If any portion of the
| ||||||
19 | reduced amount of credit has been carried to a different | ||||||
20 | taxable year, an
amended return shall be filed for such taxable | ||||||
21 | year to reduce the amount of
credit claimed.
| ||||||
22 | (j) Training expense credit. Beginning with tax years | ||||||
23 | ending on or
after December 31, 1986 and prior to December 31, | ||||||
24 | 2003, a taxpayer shall be
allowed a credit against the
tax | ||||||
25 | imposed by subsections (a) and (b) under this Section
for all | ||||||
26 | amounts paid or accrued, on behalf of all persons
employed by |
| |||||||
| |||||||
1 | the taxpayer in Illinois or Illinois residents employed
outside | ||||||
2 | of Illinois by a taxpayer, for educational or vocational | ||||||
3 | training in
semi-technical or technical fields or semi-skilled | ||||||
4 | or skilled fields, which
were deducted from gross income in the | ||||||
5 | computation of taxable income. The
credit against the tax | ||||||
6 | imposed by subsections (a) and (b) shall be 1.6% of
such | ||||||
7 | training expenses. For partners, shareholders of subchapter S
| ||||||
8 | corporations, and owners of limited liability companies, if the | ||||||
9 | liability
company is treated as a partnership for purposes of | ||||||
10 | federal and State income
taxation, there shall be allowed a | ||||||
11 | credit under this subsection (j) to be
determined in accordance | ||||||
12 | with the determination of income and distributive
share of | ||||||
13 | income under Sections 702 and 704 and subchapter S of the | ||||||
14 | Internal
Revenue Code.
| ||||||
15 | Any credit allowed under this subsection which is unused in | ||||||
16 | the year
the credit is earned may be carried forward to each of | ||||||
17 | the 5 taxable
years following the year for which the credit is | ||||||
18 | first computed until it is
used. This credit shall be applied | ||||||
19 | first to the earliest year for which
there is a liability. If | ||||||
20 | there is a credit under this subsection from more
than one tax | ||||||
21 | year that is available to offset a liability the earliest
| ||||||
22 | credit arising under this subsection shall be applied first. No | ||||||
23 | carryforward
credit may be claimed in any tax year ending on or | ||||||
24 | after
December 31, 2003.
| ||||||
25 | (k) Research and development credit.
| ||||||
26 | For tax years ending after July 1, 1990 and prior to
|
| |||||||
| |||||||
1 | December 31, 2003, and beginning again for tax years ending on | ||||||
2 | or after December 31, 2004, a taxpayer shall be
allowed a | ||||||
3 | credit against the tax imposed by subsections (a) and (b) of | ||||||
4 | this
Section for increasing research activities in this State. | ||||||
5 | The credit
allowed against the tax imposed by subsections (a) | ||||||
6 | and (b) shall be equal
to 6 1/2% of the qualifying expenditures | ||||||
7 | for increasing research activities
in this State. For partners, | ||||||
8 | shareholders of subchapter S corporations, and
owners of | ||||||
9 | limited liability companies, if the liability company is | ||||||
10 | treated as a
partnership for purposes of federal and State | ||||||
11 | income taxation, there shall be
allowed a credit under this | ||||||
12 | subsection to be determined in accordance with the
| ||||||
13 | determination of income and distributive share of income under | ||||||
14 | Sections 702 and
704 and subchapter S of the Internal Revenue | ||||||
15 | Code.
| ||||||
16 | For purposes of this subsection, "qualifying expenditures" | ||||||
17 | means the
qualifying expenditures as defined for the federal | ||||||
18 | credit for increasing
research activities which would be | ||||||
19 | allowable under Section 41 of the
Internal Revenue Code and | ||||||
20 | which are conducted in this State, "qualifying
expenditures for | ||||||
21 | increasing research activities in this State" means the
excess | ||||||
22 | of qualifying expenditures for the taxable year in which | ||||||
23 | incurred
over qualifying expenditures for the base period, | ||||||
24 | "qualifying expenditures
for the base period" means the average | ||||||
25 | of the qualifying expenditures for
each year in the base | ||||||
26 | period, and "base period" means the 3 taxable years
immediately |
| |||||||
| |||||||
1 | preceding the taxable year for which the determination is
being | ||||||
2 | made.
| ||||||
3 | Any credit in excess of the tax liability for the taxable | ||||||
4 | year
may be carried forward. A taxpayer may elect to have the
| ||||||
5 | unused credit shown on its final completed return carried over | ||||||
6 | as a credit
against the tax liability for the following 5 | ||||||
7 | taxable years or until it has
been fully used, whichever occurs | ||||||
8 | first; provided that no credit earned in a tax year ending | ||||||
9 | prior to December 31, 2003 may be carried forward to any year | ||||||
10 | ending on or after December 31, 2003.
| ||||||
11 | If an unused credit is carried forward to a given year from | ||||||
12 | 2 or more
earlier years, that credit arising in the earliest | ||||||
13 | year will be applied
first against the tax liability for the | ||||||
14 | given year. If a tax liability for
the given year still | ||||||
15 | remains, the credit from the next earliest year will
then be | ||||||
16 | applied, and so on, until all credits have been used or no tax
| ||||||
17 | liability for the given year remains. Any remaining unused | ||||||
18 | credit or
credits then will be carried forward to the next | ||||||
19 | following year in which a
tax liability is incurred, except | ||||||
20 | that no credit can be carried forward to
a year which is more | ||||||
21 | than 5 years after the year in which the expense for
which the | ||||||
22 | credit is given was incurred.
| ||||||
23 | No inference shall be drawn from this amendatory Act of the | ||||||
24 | 91st General
Assembly in construing this Section for taxable | ||||||
25 | years beginning before January
1, 1999.
| ||||||
26 | (l) Environmental Remediation Tax Credit.
|
| |||||||
| |||||||
1 | (i) For tax years ending after December 31, 1997 and on | ||||||
2 | or before
December 31, 2001, a taxpayer shall be allowed a | ||||||
3 | credit against the tax
imposed by subsections (a) and (b) | ||||||
4 | of this Section for certain amounts paid
for unreimbursed | ||||||
5 | eligible remediation costs, as specified in this | ||||||
6 | subsection.
For purposes of this Section, "unreimbursed | ||||||
7 | eligible remediation costs" means
costs approved by the | ||||||
8 | Illinois Environmental Protection Agency ("Agency") under
| ||||||
9 | Section 58.14 of the Environmental Protection Act that were | ||||||
10 | paid in performing
environmental remediation at a site for | ||||||
11 | which a No Further Remediation Letter
was issued by the | ||||||
12 | Agency and recorded under Section 58.10 of the | ||||||
13 | Environmental
Protection Act. The credit must be claimed | ||||||
14 | for the taxable year in which
Agency approval of the | ||||||
15 | eligible remediation costs is granted. The credit is
not | ||||||
16 | available to any taxpayer if the taxpayer or any related | ||||||
17 | party caused or
contributed to, in any material respect, a | ||||||
18 | release of regulated substances on,
in, or under the site | ||||||
19 | that was identified and addressed by the remedial
action | ||||||
20 | pursuant to the Site Remediation Program of the | ||||||
21 | Environmental Protection
Act. After the Pollution Control | ||||||
22 | Board rules are adopted pursuant to the
Illinois | ||||||
23 | Administrative Procedure Act for the administration and | ||||||
24 | enforcement of
Section 58.9 of the Environmental | ||||||
25 | Protection Act, determinations as to credit
availability | ||||||
26 | for purposes of this Section shall be made consistent with |
| |||||||
| |||||||
1 | those
rules. For purposes of this Section, "taxpayer" | ||||||
2 | includes a person whose tax
attributes the taxpayer has | ||||||
3 | succeeded to under Section 381 of the Internal
Revenue Code | ||||||
4 | and "related party" includes the persons disallowed a | ||||||
5 | deduction
for losses by paragraphs (b), (c), and (f)(1) of | ||||||
6 | Section 267 of the Internal
Revenue Code by virtue of being | ||||||
7 | a related taxpayer, as well as any of its
partners. The | ||||||
8 | credit allowed against the tax imposed by subsections (a) | ||||||
9 | and
(b) shall be equal to 25% of the unreimbursed eligible | ||||||
10 | remediation costs in
excess of $100,000 per site, except | ||||||
11 | that the $100,000 threshold shall not apply
to any site | ||||||
12 | contained in an enterprise zone as determined by the | ||||||
13 | Department of
Commerce and Community Affairs (now | ||||||
14 | Department of Commerce and Economic Opportunity). The | ||||||
15 | total credit allowed shall not exceed
$40,000 per year with | ||||||
16 | a maximum total of $150,000 per site. For partners and
| ||||||
17 | shareholders of subchapter S corporations, there shall be | ||||||
18 | allowed a credit
under this subsection to be determined in | ||||||
19 | accordance with the determination of
income and | ||||||
20 | distributive share of income under Sections 702 and 704 and
| ||||||
21 | subchapter S of the Internal Revenue Code.
| ||||||
22 | (ii) A credit allowed under this subsection that is | ||||||
23 | unused in the year
the credit is earned may be carried | ||||||
24 | forward to each of the 5 taxable years
following the year | ||||||
25 | for which the credit is first earned until it is used.
The | ||||||
26 | term "unused credit" does not include any amounts of |
| |||||||
| |||||||
1 | unreimbursed eligible
remediation costs in excess of the | ||||||
2 | maximum credit per site authorized under
paragraph (i). | ||||||
3 | This credit shall be applied first to the earliest year
for | ||||||
4 | which there is a liability. If there is a credit under this | ||||||
5 | subsection
from more than one tax year that is available to | ||||||
6 | offset a liability, the
earliest credit arising under this | ||||||
7 | subsection shall be applied first. A
credit allowed under | ||||||
8 | this subsection may be sold to a buyer as part of a sale
of | ||||||
9 | all or part of the remediation site for which the credit | ||||||
10 | was granted. The
purchaser of a remediation site and the | ||||||
11 | tax credit shall succeed to the unused
credit and remaining | ||||||
12 | carry-forward period of the seller. To perfect the
| ||||||
13 | transfer, the assignor shall record the transfer in the | ||||||
14 | chain of title for the
site and provide written notice to | ||||||
15 | the Director of the Illinois Department of
Revenue of the | ||||||
16 | assignor's intent to sell the remediation site and the | ||||||
17 | amount of
the tax credit to be transferred as a portion of | ||||||
18 | the sale. In no event may a
credit be transferred to any | ||||||
19 | taxpayer if the taxpayer or a related party would
not be | ||||||
20 | eligible under the provisions of subsection (i).
| ||||||
21 | (iii) For purposes of this Section, the term "site" | ||||||
22 | shall have the same
meaning as under Section 58.2 of the | ||||||
23 | Environmental Protection Act.
| ||||||
24 | (m) Education expense credit. Beginning with tax years | ||||||
25 | ending after
December 31, 1999, a taxpayer who
is the custodian | ||||||
26 | of one or more qualifying pupils shall be allowed a credit
|
| |||||||
| |||||||
1 | against the tax imposed by subsections (a) and (b) of this | ||||||
2 | Section for
qualified education expenses incurred on behalf of | ||||||
3 | the qualifying pupils.
The credit shall be equal to 25% of | ||||||
4 | qualified education expenses, but in no
event may the total | ||||||
5 | credit under this subsection claimed by a
family that is the
| ||||||
6 | custodian of qualifying pupils exceed $500. In no event shall a | ||||||
7 | credit under
this subsection reduce the taxpayer's liability | ||||||
8 | under this Act to less than
zero. This subsection is exempt | ||||||
9 | from the provisions of Section 250 of this
Act.
| ||||||
10 | For purposes of this subsection:
| ||||||
11 | "Qualifying pupils" means individuals who (i) are | ||||||
12 | residents of the State of
Illinois, (ii) are under the age of | ||||||
13 | 21 at the close of the school year for
which a credit is | ||||||
14 | sought, and (iii) during the school year for which a credit
is | ||||||
15 | sought were full-time pupils enrolled in a kindergarten through | ||||||
16 | twelfth
grade education program at any school, as defined in | ||||||
17 | this subsection.
| ||||||
18 | "Qualified education expense" means the amount incurred
on | ||||||
19 | behalf of a qualifying pupil in excess of $250 for tuition, | ||||||
20 | book fees, and
lab fees at the school in which the pupil is | ||||||
21 | enrolled during the regular school
year.
| ||||||
22 | "School" means any public or nonpublic elementary or | ||||||
23 | secondary school in
Illinois that is in compliance with Title | ||||||
24 | VI of the Civil Rights Act of 1964
and attendance at which | ||||||
25 | satisfies the requirements of Section 26-1 of the
School Code, | ||||||
26 | except that nothing shall be construed to require a child to
|
| |||||||
| |||||||
1 | attend any particular public or nonpublic school to qualify for | ||||||
2 | the credit
under this Section.
| ||||||
3 | "Custodian" means, with respect to qualifying pupils, an | ||||||
4 | Illinois resident
who is a parent, the parents, a legal | ||||||
5 | guardian, or the legal guardians of the
qualifying pupils.
| ||||||
6 | (n) River Edge Redevelopment Zone site remediation tax | ||||||
7 | credit.
| ||||||
8 | (i) For tax years ending on or after December 31, 2006, | ||||||
9 | a taxpayer shall be allowed a credit against the tax | ||||||
10 | imposed by subsections (a) and (b) of this Section for | ||||||
11 | certain amounts paid for unreimbursed eligible remediation | ||||||
12 | costs, as specified in this subsection. For purposes of | ||||||
13 | this Section, "unreimbursed eligible remediation costs" | ||||||
14 | means costs approved by the Illinois Environmental | ||||||
15 | Protection Agency ("Agency") under Section 58.14 of the | ||||||
16 | Environmental Protection Act that were paid in performing | ||||||
17 | environmental remediation at a site within a River Edge | ||||||
18 | Redevelopment Zone for which a No Further Remediation | ||||||
19 | Letter was issued by the Agency and recorded under Section | ||||||
20 | 58.10 of the Environmental Protection Act. The credit must | ||||||
21 | be claimed for the taxable year in which Agency approval of | ||||||
22 | the eligible remediation costs is granted. The credit is | ||||||
23 | not available to any taxpayer if the taxpayer or any | ||||||
24 | related party caused or contributed to, in any material | ||||||
25 | respect, a release of regulated substances on, in, or under | ||||||
26 | the site that was identified and addressed by the remedial |
| |||||||
| |||||||
1 | action pursuant to the Site Remediation Program of the | ||||||
2 | Environmental Protection Act. Determinations as to credit | ||||||
3 | availability for purposes of this Section shall be made | ||||||
4 | consistent with rules adopted by the Pollution Control | ||||||
5 | Board pursuant to the Illinois Administrative Procedure | ||||||
6 | Act for the administration and enforcement of Section 58.9 | ||||||
7 | of the Environmental Protection Act. For purposes of this | ||||||
8 | Section, "taxpayer" includes a person whose tax attributes | ||||||
9 | the taxpayer has succeeded to under Section 381 of the | ||||||
10 | Internal Revenue Code and "related party" includes the | ||||||
11 | persons disallowed a deduction for losses by paragraphs | ||||||
12 | (b), (c), and (f)(1) of Section 267 of the Internal Revenue | ||||||
13 | Code by virtue of being a related taxpayer, as well as any | ||||||
14 | of its partners. The credit allowed against the tax imposed | ||||||
15 | by subsections (a) and (b) shall be equal to 25% of the | ||||||
16 | unreimbursed eligible remediation costs in excess of | ||||||
17 | $100,000 per site. | ||||||
18 | (ii) A credit allowed under this subsection that is | ||||||
19 | unused in the year the credit is earned may be carried | ||||||
20 | forward to each of the 5 taxable years following the year | ||||||
21 | for which the credit is first earned until it is used. This | ||||||
22 | credit shall be applied first to the earliest year for | ||||||
23 | which there is a liability. If there is a credit under this | ||||||
24 | subsection from more than one tax year that is available to | ||||||
25 | offset a liability, the earliest credit arising under this | ||||||
26 | subsection shall be applied first. A credit allowed under |
| |||||||
| |||||||
1 | this subsection may be sold to a buyer as part of a sale of | ||||||
2 | all or part of the remediation site for which the credit | ||||||
3 | was granted. The purchaser of a remediation site and the | ||||||
4 | tax credit shall succeed to the unused credit and remaining | ||||||
5 | carry-forward period of the seller. To perfect the | ||||||
6 | transfer, the assignor shall record the transfer in the | ||||||
7 | chain of title for the site and provide written notice to | ||||||
8 | the Director of the Illinois Department of Revenue of the | ||||||
9 | assignor's intent to sell the remediation site and the | ||||||
10 | amount of the tax credit to be transferred as a portion of | ||||||
11 | the sale. In no event may a credit be transferred to any | ||||||
12 | taxpayer if the taxpayer or a related party would not be | ||||||
13 | eligible under the provisions of subsection (i). | ||||||
14 | (iii) For purposes of this Section, the term "site" | ||||||
15 | shall have the same meaning as under Section 58.2 of the | ||||||
16 | Environmental Protection Act. | ||||||
17 | (iv) This subsection is exempt from the provisions of | ||||||
18 | Section 250.
| ||||||
19 | (Source: P.A. 93-29, eff. 6-20-03; 93-840, eff. 7-30-04; | ||||||
20 | 93-871, eff. 8-6-04; 94-1021, eff. 7-12-06.)
| ||||||
21 | (35 ILCS 5/203) (from Ch. 120, par. 2-203)
| ||||||
22 | Sec. 203. Base income defined.
| ||||||
23 | (a) Individuals.
| ||||||
24 | (1) In general. In the case of an individual, base | ||||||
25 | 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 the | ||||||
5 | 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 1, | ||||||
23 | 1991, the retrospective application date of
Article 4 | ||||||
24 | 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 on | ||||||
11 | the account in the
taxable year of a withdrawal | ||||||
12 | pursuant to subsection (b) of Section 20 of the
Medical | ||||||
13 | Care Savings Account Act or subsection (b) of Section | ||||||
14 | 20 of the
Medical Care Savings Account Act of 2000;
| ||||||
15 | (D-10) For taxable years ending after December 31, | ||||||
16 | 1997, an
amount equal to any eligible remediation costs | ||||||
17 | that the individual
deducted in computing adjusted | ||||||
18 | gross income and for which the
individual claims a | ||||||
19 | credit under subsection (l) of Section 201;
| ||||||
20 | (D-15) For taxable years 2001 and thereafter, an | ||||||
21 | amount equal to the
bonus depreciation deduction taken | ||||||
22 | on the taxpayer's federal income tax return for the | ||||||
23 | taxable
year under subsection (k) of Section 168 of the | ||||||
24 | Internal Revenue Code;
| ||||||
25 | (D-16) If the taxpayer sells, transfers, abandons, | ||||||
26 | or otherwise disposes of property for which the |
| |||||||
| |||||||
1 | taxpayer was required in any taxable year to
make an | ||||||
2 | addition modification under subparagraph (D-15), then | ||||||
3 | an amount equal
to the aggregate amount of the | ||||||
4 | deductions taken in all taxable
years under | ||||||
5 | subparagraph (Z) with respect to that property ;
.
| ||||||
6 | If the taxpayer continues to own property through | ||||||
7 | the last day of the last tax year for which the | ||||||
8 | taxpayer may claim a depreciation deduction for | ||||||
9 | federal income tax purposes and for which the taxpayer | ||||||
10 | was allowed in any taxable year to make a subtraction | ||||||
11 | modification under subparagraph (Z), then an amount | ||||||
12 | equal to that subtraction modification.
| ||||||
13 | The taxpayer is required to make the addition | ||||||
14 | modification under this
subparagraph
only once with | ||||||
15 | respect to any one piece of property;
| ||||||
16 | (D-17) For taxable years ending on or after | ||||||
17 | December 31, 2004, an amount equal to the amount | ||||||
18 | otherwise allowed as a deduction in computing base | ||||||
19 | income for interest paid, accrued, or incurred, | ||||||
20 | directly or indirectly, to a foreign person who would | ||||||
21 | be a member of the same unitary business group but for | ||||||
22 | the fact that foreign person's business activity | ||||||
23 | outside the United States is 80% or more of the foreign | ||||||
24 | person's total business activity. The addition | ||||||
25 | modification required by this subparagraph shall be | ||||||
26 | reduced to the extent that dividends were included in |
| |||||||
| |||||||
1 | base income of the unitary group for the same taxable | ||||||
2 | year and received by the taxpayer or by a member of the | ||||||
3 | taxpayer's unitary business group (including amounts | ||||||
4 | included in gross income under Sections 951 through 964 | ||||||
5 | of the Internal Revenue Code and amounts included in | ||||||
6 | gross income under Section 78 of the Internal Revenue | ||||||
7 | Code) with respect to the stock of the same person to | ||||||
8 | whom the interest was paid, 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 foreign | ||||||
12 | person who is subject in a foreign country or | ||||||
13 | state, other than a state which requires mandatory | ||||||
14 | unitary reporting, to a tax on or measured by net | ||||||
15 | income with respect to such interest; or | ||||||
16 | (ii) an item of interest paid, accrued, or | ||||||
17 | incurred, directly or indirectly, to a foreign | ||||||
18 | person if the taxpayer can establish, based on a | ||||||
19 | preponderance of the evidence, both of the | ||||||
20 | following: | ||||||
21 | (a) the foreign person, during the same | ||||||
22 | taxable year, paid, accrued, or incurred, the | ||||||
23 | interest to a person that is not a related | ||||||
24 | member, and | ||||||
25 | (b) the transaction giving rise to the | ||||||
26 | interest expense between the taxpayer and the |
| |||||||
| |||||||
1 | foreign person did not have as a principal | ||||||
2 | purpose the avoidance of Illinois income tax, | ||||||
3 | and is paid pursuant to a contract or agreement | ||||||
4 | that reflects an arm's-length interest rate | ||||||
5 | and terms; or
| ||||||
6 | (iii) the taxpayer can establish, based on | ||||||
7 | clear and convincing evidence, that the interest | ||||||
8 | paid, accrued, or incurred relates to a contract or | ||||||
9 | agreement entered into at arm's-length rates and | ||||||
10 | terms and the principal purpose for the payment is | ||||||
11 | not federal or Illinois tax avoidance; or
| ||||||
12 | (iv) an item of interest paid, accrued, or | ||||||
13 | incurred, directly or indirectly, to a foreign | ||||||
14 | person if the taxpayer establishes by clear and | ||||||
15 | convincing evidence that the adjustments are | ||||||
16 | unreasonable; or if the taxpayer and the Director | ||||||
17 | agree in writing to the application or use of an | ||||||
18 | alternative method of apportionment under Section | ||||||
19 | 304(f).
| ||||||
20 | Nothing in this subsection shall preclude the | ||||||
21 | Director from making any other adjustment | ||||||
22 | otherwise allowed under Section 404 of this Act for | ||||||
23 | any tax year beginning after the effective date of | ||||||
24 | this amendment provided such adjustment is made | ||||||
25 | pursuant to regulation adopted by the Department | ||||||
26 | and such regulations provide methods and standards |
| |||||||
| |||||||
1 | by which the Department will utilize its authority | ||||||
2 | under Section 404 of this Act;
| ||||||
3 | (D-18) For taxable years ending on or after | ||||||
4 | December 31, 2004, an amount equal to the amount of | ||||||
5 | intangible expenses and costs otherwise allowed as a | ||||||
6 | deduction in computing base income, and that were paid, | ||||||
7 | accrued, or incurred, directly or indirectly, to a | ||||||
8 | foreign person who would be a member of the same | ||||||
9 | unitary business group but for the fact that the | ||||||
10 | foreign person's business activity outside the United | ||||||
11 | States is 80% or more of that person's total business | ||||||
12 | activity. The addition modification required by this | ||||||
13 | subparagraph shall be reduced to the extent that | ||||||
14 | dividends were included in base income of the unitary | ||||||
15 | group for the same taxable year and received by the | ||||||
16 | taxpayer or by a member of the taxpayer's unitary | ||||||
17 | business group (including amounts included in gross | ||||||
18 | income under Sections 951 through 964 of the Internal | ||||||
19 | Revenue Code and amounts included in gross income under | ||||||
20 | Section 78 of the Internal Revenue Code) with respect | ||||||
21 | to the stock of the same person to whom the intangible | ||||||
22 | expenses and costs were directly or indirectly paid, | ||||||
23 | incurred, or accrued. The preceding sentence does not | ||||||
24 | apply to the extent that the same dividends caused a | ||||||
25 | reduction to the addition modification required under | ||||||
26 | Section 203(a)(2)(D-17) of this Act. As used in this |
| |||||||
| |||||||
1 | subparagraph, the term "intangible expenses and costs" | ||||||
2 | includes (1) expenses, losses, and costs for, or | ||||||
3 | related to, the direct or indirect acquisition, use, | ||||||
4 | maintenance or management, ownership, sale, exchange, | ||||||
5 | or any other disposition of intangible property; (2) | ||||||
6 | losses incurred, directly or indirectly, from | ||||||
7 | factoring transactions or discounting transactions; | ||||||
8 | (3) royalty, patent, technical, and copyright fees; | ||||||
9 | (4) licensing fees; and (5) other similar expenses and | ||||||
10 | costs.
For purposes of this subparagraph, "intangible | ||||||
11 | property" includes patents, patent applications, trade | ||||||
12 | names, trademarks, service marks, copyrights, mask | ||||||
13 | works, trade secrets, and similar types of intangible | ||||||
14 | assets. | ||||||
15 | This paragraph shall not apply to the following: | ||||||
16 | (i) any item of intangible expenses or costs | ||||||
17 | paid, accrued, or incurred, directly or | ||||||
18 | indirectly, from a transaction with a foreign | ||||||
19 | person who is subject in a foreign country or | ||||||
20 | state, other than a state which requires mandatory | ||||||
21 | unitary reporting, to a tax on or measured by net | ||||||
22 | income with respect to such item; or | ||||||
23 | (ii) any item of intangible expense or cost | ||||||
24 | paid, accrued, or incurred, directly or | ||||||
25 | indirectly, if the taxpayer can establish, based | ||||||
26 | on a preponderance of the evidence, both of the |
| |||||||
| |||||||
1 | following: | ||||||
2 | (a) the foreign person during the same | ||||||
3 | taxable year paid, accrued, or incurred, the | ||||||
4 | intangible expense or cost to a person that is | ||||||
5 | not a related member, and | ||||||
6 | (b) the transaction giving rise to the | ||||||
7 | intangible expense or cost between the | ||||||
8 | taxpayer and the foreign person did not have as | ||||||
9 | a principal purpose the avoidance of Illinois | ||||||
10 | income tax, and is paid pursuant to a contract | ||||||
11 | or agreement that reflects arm's-length terms; | ||||||
12 | or | ||||||
13 | (iii) any item of intangible expense or cost | ||||||
14 | paid, accrued, or incurred, directly or | ||||||
15 | indirectly, from a transaction with a foreign | ||||||
16 | person if the taxpayer establishes by clear and | ||||||
17 | convincing evidence, that the adjustments are | ||||||
18 | unreasonable; or if the taxpayer and the Director | ||||||
19 | agree in writing to the application or use of an | ||||||
20 | alternative method of apportionment under Section | ||||||
21 | 304(f);
| ||||||
22 | Nothing in this subsection shall preclude the | ||||||
23 | Director from making any other adjustment | ||||||
24 | otherwise allowed under Section 404 of this Act for | ||||||
25 | any tax year beginning after the effective date of | ||||||
26 | this amendment provided such adjustment is made |
| |||||||
| |||||||
1 | pursuant to regulation adopted by the Department | ||||||
2 | and such regulations provide methods and standards | ||||||
3 | by which the Department will utilize its authority | ||||||
4 | under Section 404 of this Act;
| ||||||
5 | (D-20) For taxable years beginning on or after | ||||||
6 | January 1,
2002, in
the
case of a distribution from a | ||||||
7 | qualified tuition program under Section 529 of
the | ||||||
8 | Internal Revenue Code, other than (i) a distribution | ||||||
9 | from a College Savings
Pool created under Section 16.5 | ||||||
10 | of the State Treasurer Act or (ii) a
distribution from | ||||||
11 | the Illinois Prepaid Tuition Trust Fund, an amount | ||||||
12 | equal to
the amount excluded from gross income under | ||||||
13 | Section 529(c)(3)(B);
| ||||||
14 | and by deducting from the total so obtained the
sum of the | ||||||
15 | following amounts:
| ||||||
16 | (E) For taxable years ending before December 31, | ||||||
17 | 2001,
any amount included in such total in respect of | ||||||
18 | any compensation
(including but not limited to any | ||||||
19 | compensation paid or accrued to a
serviceman while a | ||||||
20 | prisoner of war or missing in action) paid to a | ||||||
21 | resident
by reason of being on active duty in the Armed | ||||||
22 | Forces of the United States
and in respect of any | ||||||
23 | compensation paid or accrued to a resident who as a
| ||||||
24 | governmental employee was a prisoner of war or missing | ||||||
25 | in action, and in
respect of any compensation paid to a | ||||||
26 | resident in 1971 or thereafter for
annual training |
| |||||||
| |||||||
1 | performed pursuant to Sections 502 and 503, Title 32,
| ||||||
2 | United States Code as a member of the Illinois National | ||||||
3 | Guard.
For taxable years ending on or after December | ||||||
4 | 31, 2001, any amount included in
such total in respect | ||||||
5 | of any compensation (including but not limited to any
| ||||||
6 | compensation paid or accrued to a serviceman while a | ||||||
7 | prisoner of war or missing
in action) paid to a | ||||||
8 | resident by reason of being a member of any component | ||||||
9 | of
the Armed Forces of the United States and in respect | ||||||
10 | of any compensation paid
or accrued to a resident who | ||||||
11 | as a governmental employee was a prisoner of war
or | ||||||
12 | missing in action, and in respect of any compensation | ||||||
13 | paid to a resident in
2001 or thereafter by reason of | ||||||
14 | being a member of the Illinois National Guard.
The | ||||||
15 | provisions of this amendatory Act of the 92nd General | ||||||
16 | Assembly are exempt
from the provisions of Section 250;
| ||||||
17 | (F) For taxable years beginning on or before | ||||||
18 | January 1, 2007, an
An amount equal to all amounts | ||||||
19 | included in such total pursuant
to the provisions of | ||||||
20 | Sections 402(a), 402(c), 403(a), 403(b), 406(a), | ||||||
21 | 407(a),
and 408 of the Internal Revenue Code, or | ||||||
22 | included in such total as
distributions under the | ||||||
23 | provisions of any retirement or disability plan for
| ||||||
24 | employees of any governmental agency or unit, or | ||||||
25 | retirement payments to
retired partners, which | ||||||
26 | payments are excluded in computing net earnings
from |
| |||||||
| |||||||
1 | self employment by Section 1402 of the Internal Revenue | ||||||
2 | Code and
regulations adopted pursuant thereto; | ||||||
3 | (F-5) For taxable years beginning after January 1, | ||||||
4 | 2006, for those taxpayers who report an adjusted gross | ||||||
5 | income of $74,999 ("the retirement threshold amount") | ||||||
6 | or less, an amount equal to all amounts included in | ||||||
7 | such total pursuant
to the provisions of Sections | ||||||
8 | 402(a), 402(c), 403(a), 403(b), 406(a), 407(a),
and | ||||||
9 | 408 of the Internal Revenue Code, or included in such | ||||||
10 | total as
distributions under the provisions of any | ||||||
11 | retirement or disability plan for
employees of any | ||||||
12 | governmental agency or unit, or retirement payments to
| ||||||
13 | retired partners, which payments are excluded in | ||||||
14 | computing net earnings
from self employment by Section | ||||||
15 | 1402 of the Internal Revenue Code and
regulations | ||||||
16 | adopted pursuant thereto, provided that the retirement | ||||||
17 | threshold amount shall increase annually for each tax | ||||||
18 | year by the percentage increase, if any, in the | ||||||
19 | Consumer Price Index published by the U.S. Bureau of | ||||||
20 | Labor Statistics from July of the immediately | ||||||
21 | preceding tax year to June 30 of the then current tax | ||||||
22 | year;
| ||||||
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 such | ||||||
2 | total pursuant
to the provisions of Section 111 of the | ||||||
3 | Internal Revenue Code as a
recovery of items previously | ||||||
4 | deducted from adjusted gross income in the
computation | ||||||
5 | 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 an Enterprise
Zone or | ||||||
9 | zones created under the Illinois Enterprise Zone Act or | ||||||
10 | a River Edge Redevelopment Zone or zones created under | ||||||
11 | the River Edge Redevelopment Zone Act, and conducts
| ||||||
12 | substantially all of its operations in an Enterprise | ||||||
13 | Zone or zones or a River Edge Redevelopment Zone or | ||||||
14 | zones. This subparagraph (J) is exempt from the | ||||||
15 | provisions of Section 250;
| ||||||
16 | (K) An amount equal to those dividends included in | ||||||
17 | such total that
were paid by a corporation that | ||||||
18 | conducts business operations in a federally
designated | ||||||
19 | Foreign Trade Zone or Sub-Zone and that is designated a | ||||||
20 | High Impact
Business located in Illinois; provided | ||||||
21 | that dividends eligible for the
deduction provided in | ||||||
22 | subparagraph (J) of paragraph (2) of this subsection
| ||||||
23 | shall not be eligible for the deduction provided under | ||||||
24 | this subparagraph
(K);
| ||||||
25 | (L) For taxable years ending after December 31, | ||||||
26 | 1983, an amount equal to
all social security benefits |
| |||||||
| |||||||
1 | and railroad retirement benefits included in
such | ||||||
2 | total pursuant to Sections 72(r) and 86 of the Internal | ||||||
3 | Revenue Code;
| ||||||
4 | (M) With the exception of any amounts subtracted | ||||||
5 | under subparagraph
(N), an amount equal to the sum of | ||||||
6 | all amounts disallowed as
deductions by (i) Sections | ||||||
7 | 171(a) (2), and 265(2) of the Internal Revenue Code
of | ||||||
8 | 1954, as now or hereafter amended, and all amounts of | ||||||
9 | expenses allocable
to interest and disallowed as | ||||||
10 | deductions by Section 265(1) of the Internal
Revenue | ||||||
11 | Code of 1954, as now or hereafter amended;
and (ii) for | ||||||
12 | taxable years
ending on or after August 13, 1999, | ||||||
13 | Sections 171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of | ||||||
14 | the Internal Revenue Code; the provisions of this
| ||||||
15 | subparagraph are exempt from the provisions of Section | ||||||
16 | 250;
| ||||||
17 | (N) An amount equal to all amounts included in such | ||||||
18 | total which are
exempt from taxation by this State | ||||||
19 | either by reason of its statutes or
Constitution
or by | ||||||
20 | reason of the Constitution, treaties or statutes of the | ||||||
21 | United States;
provided that, in the case of any | ||||||
22 | statute of this State that exempts income
derived from | ||||||
23 | bonds or other obligations from the tax imposed under | ||||||
24 | this Act,
the amount exempted shall be the interest net | ||||||
25 | of bond premium amortization;
| ||||||
26 | (O) An amount equal to any contribution made to a |
| |||||||
| |||||||
1 | job training
project established pursuant to the Tax | ||||||
2 | Increment Allocation Redevelopment Act;
| ||||||
3 | (P) An amount equal to the amount of the deduction | ||||||
4 | used to compute the
federal income tax credit for | ||||||
5 | restoration of substantial amounts held under
claim of | ||||||
6 | right for the taxable year pursuant to Section 1341 of | ||||||
7 | the
Internal Revenue Code of 1986;
| ||||||
8 | (Q) An amount equal to any amounts included in such | ||||||
9 | total, received by
the taxpayer as an acceleration in | ||||||
10 | the payment of life, endowment or annuity
benefits in | ||||||
11 | advance of the time they would otherwise be payable as | ||||||
12 | an indemnity
for a terminal illness;
| ||||||
13 | (R) An amount equal to the amount of any federal or | ||||||
14 | State bonus paid
to veterans of the Persian Gulf War;
| ||||||
15 | (S) An amount, to the extent included in adjusted | ||||||
16 | gross income, equal
to the amount of a contribution | ||||||
17 | made in the taxable year on behalf of the
taxpayer to a | ||||||
18 | medical care savings account established under the | ||||||
19 | Medical Care
Savings Account Act or the Medical Care | ||||||
20 | Savings Account Act of 2000 to the
extent the | ||||||
21 | contribution is accepted by the account
administrator | ||||||
22 | as provided in that Act;
| ||||||
23 | (T) An amount, to the extent included in adjusted | ||||||
24 | gross income, equal to
the amount of interest earned in | ||||||
25 | the taxable year on a medical care savings
account | ||||||
26 | established under the Medical Care Savings Account Act |
| |||||||
| |||||||
1 | or the Medical
Care Savings Account Act of 2000 on | ||||||
2 | behalf of the
taxpayer, other than interest added | ||||||
3 | pursuant to item (D-5) of this paragraph
(2);
| ||||||
4 | (U) For one taxable year beginning on or after | ||||||
5 | January 1,
1994, an
amount equal to the total amount of | ||||||
6 | tax imposed and paid under subsections (a)
and (b) of | ||||||
7 | Section 201 of this Act on grant amounts received by | ||||||
8 | the taxpayer
under the Nursing Home Grant Assistance | ||||||
9 | Act during the taxpayer's taxable years
1992 and 1993;
| ||||||
10 | (V) Beginning with tax years ending on or after | ||||||
11 | December 31, 1995 and
ending with tax years ending on | ||||||
12 | or before December 31, 2004, an amount equal to
the | ||||||
13 | amount paid by a taxpayer who is a
self-employed | ||||||
14 | taxpayer, a partner of a partnership, or a
shareholder | ||||||
15 | in a Subchapter S corporation for health insurance or | ||||||
16 | long-term
care insurance for that taxpayer or that | ||||||
17 | taxpayer's spouse or dependents, to
the extent that the | ||||||
18 | amount paid for that health insurance or long-term care
| ||||||
19 | insurance may be deducted under Section 213 of the | ||||||
20 | Internal Revenue Code of
1986, has not been deducted on | ||||||
21 | the federal income tax return of the taxpayer,
and does | ||||||
22 | not exceed the taxable income attributable to that | ||||||
23 | taxpayer's income,
self-employment income, or | ||||||
24 | Subchapter S corporation income; except that no
| ||||||
25 | deduction shall be allowed under this item (V) if the | ||||||
26 | taxpayer is eligible to
participate in any health |
| |||||||
| |||||||
1 | insurance or long-term care insurance plan of an
| ||||||
2 | employer of the taxpayer or the taxpayer's
spouse. The | ||||||
3 | amount of the health insurance and long-term care | ||||||
4 | insurance
subtracted under this item (V) shall be | ||||||
5 | determined by multiplying total
health insurance and | ||||||
6 | long-term care insurance premiums paid by the taxpayer
| ||||||
7 | times a number that represents the fractional | ||||||
8 | percentage of eligible medical
expenses under Section | ||||||
9 | 213 of the Internal Revenue Code of 1986 not actually
| ||||||
10 | deducted on the taxpayer's federal income tax return;
| ||||||
11 | (W) For taxable years beginning on or after January | ||||||
12 | 1, 1998,
all amounts included in the taxpayer's federal | ||||||
13 | gross income
in the taxable year from amounts converted | ||||||
14 | from a regular IRA to a Roth IRA.
This paragraph is | ||||||
15 | exempt from the provisions of Section
250;
| ||||||
16 | (X) For taxable year 1999 and thereafter, an amount | ||||||
17 | equal to the
amount of any (i) distributions, to the | ||||||
18 | extent includible in gross income for
federal income | ||||||
19 | tax purposes, made to the taxpayer because of his or | ||||||
20 | her status
as a victim of persecution for racial or | ||||||
21 | religious reasons by Nazi Germany or
any other Axis | ||||||
22 | regime or as an heir of the victim and (ii) items
of | ||||||
23 | income, to the extent
includible in gross income for | ||||||
24 | federal income tax purposes, attributable to,
derived | ||||||
25 | from or in any way related to assets stolen from, | ||||||
26 | hidden from, or
otherwise lost to a victim of
|
| |||||||
| |||||||
1 | persecution for racial or religious reasons by Nazi | ||||||
2 | Germany or any other Axis
regime immediately prior to, | ||||||
3 | during, and immediately after World War II,
including, | ||||||
4 | but
not limited to, interest on the proceeds receivable | ||||||
5 | as insurance
under policies issued to a victim of | ||||||
6 | persecution for racial or religious
reasons
by Nazi | ||||||
7 | Germany or any other Axis regime by European insurance | ||||||
8 | companies
immediately prior to and during World War II;
| ||||||
9 | provided, however, this subtraction from federal | ||||||
10 | adjusted gross income does not
apply to assets acquired | ||||||
11 | with such assets or with the proceeds from the sale of
| ||||||
12 | such assets; provided, further, this paragraph shall | ||||||
13 | only apply to a taxpayer
who was the first recipient of | ||||||
14 | such assets after their recovery and who is a
victim of | ||||||
15 | persecution for racial or religious reasons
by Nazi | ||||||
16 | Germany or any other Axis regime or as an heir of the | ||||||
17 | victim. The
amount of and the eligibility for any | ||||||
18 | public assistance, benefit, or
similar entitlement is | ||||||
19 | not affected by the inclusion of items (i) and (ii) of
| ||||||
20 | this paragraph in gross income for federal income tax | ||||||
21 | purposes.
This paragraph is exempt from the provisions | ||||||
22 | of Section 250;
| ||||||
23 | (Y) For taxable years beginning on or after January | ||||||
24 | 1, 2002
and ending
on or before December 31, 2004, | ||||||
25 | moneys contributed in the taxable year to a College | ||||||
26 | Savings Pool account under
Section 16.5 of the State |
| |||||||
| |||||||
1 | Treasurer Act, except that amounts excluded from
gross | ||||||
2 | income under Section 529(c)(3)(C)(i) of the Internal | ||||||
3 | Revenue Code
shall not be considered moneys | ||||||
4 | contributed under this subparagraph (Y). For taxable | ||||||
5 | years beginning on or after January 1, 2005, a maximum | ||||||
6 | of $10,000
contributed
in the
taxable year to (i) a | ||||||
7 | College Savings Pool account under Section 16.5 of the
| ||||||
8 | State
Treasurer Act or (ii) the Illinois Prepaid | ||||||
9 | Tuition Trust Fund,
except that
amounts excluded from | ||||||
10 | gross income under Section 529(c)(3)(C)(i) of the
| ||||||
11 | Internal
Revenue Code shall not be considered moneys | ||||||
12 | contributed under this subparagraph
(Y). This
| ||||||
13 | subparagraph (Y) is exempt from the provisions of | ||||||
14 | Section 250;
| ||||||
15 | (Z) For taxable years 2001 and thereafter, for the | ||||||
16 | taxable year in
which the bonus depreciation deduction
| ||||||
17 | is taken on the taxpayer's federal income tax return | ||||||
18 | under
subsection (k) of Section 168 of the Internal | ||||||
19 | Revenue Code and for each
applicable taxable year | ||||||
20 | thereafter, an amount equal to "x", where:
| ||||||
21 | (1) "y" equals the amount of the depreciation | ||||||
22 | deduction taken for the
taxable year
on the | ||||||
23 | taxpayer's federal income tax return on property | ||||||
24 | for which the bonus
depreciation deduction
was | ||||||
25 | taken in any year under subsection (k) of Section | ||||||
26 | 168 of the Internal
Revenue Code, but not including |
| |||||||
| |||||||
1 | the bonus depreciation deduction;
| ||||||
2 | (2) for taxable years ending on or before | ||||||
3 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
4 | and then divided by 70 (or "y"
multiplied by | ||||||
5 | 0.429); and | ||||||
6 | (3) for taxable years ending after December | ||||||
7 | 31, 2005: | ||||||
8 | (i) for property on which a bonus | ||||||
9 | depreciation deduction of 30% of the adjusted | ||||||
10 | basis was taken, "x" equals "y" multiplied by | ||||||
11 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
12 | 0.429); and | ||||||
13 | (ii) for property on which a bonus | ||||||
14 | depreciation deduction of 50% of the adjusted | ||||||
15 | basis was taken, "x" equals "y" multiplied by | ||||||
16 | 1.0.
| ||||||
17 | The aggregate amount deducted under this | ||||||
18 | subparagraph in all taxable
years for any one piece of | ||||||
19 | property may not exceed the amount of the bonus
| ||||||
20 | depreciation deduction
taken on that property on the | ||||||
21 | taxpayer's federal income tax return under
subsection | ||||||
22 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
23 | subparagraph (Z) is exempt from the provisions of | ||||||
24 | Section 250;
| ||||||
25 | (AA) If the taxpayer sells, transfers, abandons, | ||||||
26 | or otherwise disposes of
property for which the |
| |||||||
| |||||||
1 | taxpayer was required in any taxable year to make an
| ||||||
2 | addition modification under subparagraph (D-15), then | ||||||
3 | an amount equal to that
addition modification.
| ||||||
4 | If the taxpayer continues to own property through | ||||||
5 | the last day of the last tax year for which the | ||||||
6 | taxpayer may claim a depreciation deduction for | ||||||
7 | federal income tax purposes and for which the taxpayer | ||||||
8 | was required in any taxable year to make an addition | ||||||
9 | modification under subparagraph (D-15), then an amount | ||||||
10 | equal to that addition modification.
| ||||||
11 | The taxpayer is allowed to take the deduction under | ||||||
12 | this subparagraph
only once with respect to any one | ||||||
13 | piece of property. | ||||||
14 | This subparagraph (AA) is exempt from the | ||||||
15 | provisions of Section 250;
| ||||||
16 | (BB) Any amount included in adjusted gross income, | ||||||
17 | other
than
salary,
received by a driver in a | ||||||
18 | ridesharing arrangement using a motor vehicle;
| ||||||
19 | (CC) The amount of (i) any interest income (net of | ||||||
20 | the deductions allocable thereto) taken into account | ||||||
21 | for the taxable year with respect to a transaction with | ||||||
22 | a taxpayer that is required to make an addition | ||||||
23 | modification with respect to such transaction under | ||||||
24 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
25 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
26 | the amount of that addition modification, and
(ii) any |
| |||||||
| |||||||
1 | income from intangible property (net of the deductions | ||||||
2 | allocable thereto) taken into account for the taxable | ||||||
3 | year with respect to a transaction with a taxpayer that | ||||||
4 | is required to make an addition modification with | ||||||
5 | respect to such transaction under Section | ||||||
6 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
7 | 203(d)(2)(D-8), but not to exceed the amount of that | ||||||
8 | addition modification; | ||||||
9 | (DD) An amount equal to the interest income taken | ||||||
10 | into account for the taxable year (net of the | ||||||
11 | deductions allocable thereto) with respect to | ||||||
12 | transactions with a foreign person who would be a | ||||||
13 | member of the taxpayer's unitary business group but for | ||||||
14 | the fact that the foreign person's business activity | ||||||
15 | outside the United States is 80% or more of that | ||||||
16 | person's total business activity, but not to exceed the | ||||||
17 | addition modification required to be made for the same | ||||||
18 | taxable year under Section 203(a)(2)(D-17) for | ||||||
19 | interest paid, accrued, or incurred, directly or | ||||||
20 | indirectly, to the same foreign person; and | ||||||
21 | (EE) An amount equal to the income from intangible | ||||||
22 | property taken into account for the taxable year (net | ||||||
23 | of the deductions allocable thereto) with respect to | ||||||
24 | transactions with a foreign person who would be a | ||||||
25 | member of the taxpayer's unitary business group but for | ||||||
26 | the fact that the foreign person's business activity |
| |||||||
| |||||||
1 | outside the United States is 80% or more of that | ||||||
2 | person's total business activity, but not to exceed the | ||||||
3 | addition modification required to be made for the same | ||||||
4 | taxable year under Section 203(a)(2)(D-18) for | ||||||
5 | intangible expenses and costs paid, accrued, or | ||||||
6 | incurred, directly or indirectly, to the same foreign | ||||||
7 | person.
| ||||||
8 | (b) Corporations.
| ||||||
9 | (1) In general. In the case of a corporation, base | ||||||
10 | income means an
amount equal to the taxpayer's taxable | ||||||
11 | income for the taxable year as
modified by paragraph (2).
| ||||||
12 | (2) Modifications. The taxable income referred to in | ||||||
13 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
14 | of the following amounts:
| ||||||
15 | (A) An amount equal to all amounts paid or accrued | ||||||
16 | to the taxpayer
as interest and all distributions | ||||||
17 | received from regulated investment
companies during | ||||||
18 | the taxable year to the extent excluded from gross
| ||||||
19 | income in the computation of taxable income;
| ||||||
20 | (B) An amount equal to the amount of tax imposed by | ||||||
21 | this Act to the
extent deducted from gross income in | ||||||
22 | the computation of taxable income
for the taxable year;
| ||||||
23 | (C) In the case of a regulated investment company, | ||||||
24 | an amount equal to
the excess of (i) the net long-term | ||||||
25 | capital gain for the taxable year, over
(ii) the amount |
| |||||||
| |||||||
1 | of the capital gain dividends designated as such in | ||||||
2 | accordance
with Section 852(b)(3)(C) of the Internal | ||||||
3 | Revenue Code and any amount
designated under Section | ||||||
4 | 852(b)(3)(D) of the Internal Revenue Code,
| ||||||
5 | attributable to the taxable year (this amendatory Act | ||||||
6 | of 1995
(Public Act 89-89) is declarative of existing | ||||||
7 | law and is not a new
enactment);
| ||||||
8 | (D) The amount of any net operating loss deduction | ||||||
9 | taken in arriving
at taxable income, other than a net | ||||||
10 | operating loss carried forward from a
taxable year | ||||||
11 | ending prior to December 31, 1986;
| ||||||
12 | (E) For taxable years in which a net operating loss | ||||||
13 | carryback or
carryforward from a taxable year ending | ||||||
14 | prior to December 31, 1986 is an
element of taxable | ||||||
15 | income under paragraph (1) of subsection (e) or
| ||||||
16 | subparagraph (E) of paragraph (2) of subsection (e), | ||||||
17 | the amount by which
addition modifications other than | ||||||
18 | those provided by this subparagraph (E)
exceeded | ||||||
19 | subtraction modifications in such earlier taxable | ||||||
20 | year, with the
following limitations applied in the | ||||||
21 | order that they are listed:
| ||||||
22 | (i) the addition modification relating to the | ||||||
23 | net operating loss
carried back or forward to the | ||||||
24 | taxable year from any taxable year ending
prior to | ||||||
25 | December 31, 1986 shall be reduced by the amount of | ||||||
26 | addition
modification under this subparagraph (E) |
| |||||||
| |||||||
1 | which related to that net operating
loss and which | ||||||
2 | was taken into account in calculating the base | ||||||
3 | income of an
earlier taxable year, and
| ||||||
4 | (ii) 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 not exceed the amount of | ||||||
8 | such carryback or
carryforward;
| ||||||
9 | For taxable years in which there is a net operating | ||||||
10 | loss carryback or
carryforward from more than one other | ||||||
11 | taxable year ending prior to December
31, 1986, the | ||||||
12 | addition modification provided in this subparagraph | ||||||
13 | (E) shall
be the sum of the amounts computed | ||||||
14 | independently under the preceding
provisions of this | ||||||
15 | subparagraph (E) for each such taxable year;
| ||||||
16 | (E-5) For taxable years ending after December 31, | ||||||
17 | 1997, an
amount equal to any eligible remediation costs | ||||||
18 | that the corporation
deducted in computing adjusted | ||||||
19 | gross income and for which the
corporation claims a | ||||||
20 | credit under subsection (l) of Section 201;
| ||||||
21 | (E-10) 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 the | ||||||
25 | Internal Revenue Code; and
| ||||||
26 | (E-11) 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 (E-10), then | ||||||
4 | an amount equal
to the aggregate amount of the | ||||||
5 | deductions taken in all taxable
years under | ||||||
6 | subparagraph (T) 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 the | ||||||
9 | taxpayer may claim a depreciation deduction for | ||||||
10 | federal income tax purposes and for which the taxpayer | ||||||
11 | was allowed in any taxable year to make a subtraction | ||||||
12 | modification under subparagraph (T), 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 | (E-12) For taxable years ending on or after | ||||||
18 | December 31, 2004, an amount equal to the amount | ||||||
19 | otherwise allowed as a deduction in computing base | ||||||
20 | income for interest paid, accrued, or incurred, | ||||||
21 | directly or indirectly, to a foreign person who would | ||||||
22 | be a member of the same unitary business group but for | ||||||
23 | the fact the foreign person's business activity | ||||||
24 | outside the United States is 80% or more of the foreign | ||||||
25 | person's total business activity. The addition | ||||||
26 | modification required by this subparagraph shall be |
| |||||||
| |||||||
1 | reduced to the extent that dividends were included in | ||||||
2 | base income of the unitary group for the same taxable | ||||||
3 | year and 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 the | ||||||
9 | same person to whom the interest was paid, accrued, or | ||||||
10 | 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 foreign | ||||||
14 | person who is subject in a foreign country or | ||||||
15 | state, other than a state which requires mandatory | ||||||
16 | unitary reporting, to a tax on or measured by net | ||||||
17 | income with respect to such interest; or | ||||||
18 | (ii) an item of interest paid, accrued, or | ||||||
19 | incurred, directly or indirectly, to a foreign | ||||||
20 | person if the taxpayer can establish, based on a | ||||||
21 | preponderance of the evidence, both of the | ||||||
22 | following: | ||||||
23 | (a) the foreign person, during the same | ||||||
24 | taxable year, paid, accrued, or incurred, the | ||||||
25 | interest to a person that is not a related | ||||||
26 | member, and |
| |||||||
| |||||||
1 | (b) the transaction giving rise to the | ||||||
2 | interest expense between the taxpayer and the | ||||||
3 | foreign person did not have as a principal | ||||||
4 | purpose the avoidance of Illinois income tax, | ||||||
5 | and is paid pursuant to a contract or agreement | ||||||
6 | that reflects an arm's-length interest rate | ||||||
7 | and terms; or
| ||||||
8 | (iii) the taxpayer can establish, based on | ||||||
9 | clear and convincing evidence, that the interest | ||||||
10 | paid, accrued, or incurred relates to a contract or | ||||||
11 | agreement entered into at arm's-length rates and | ||||||
12 | terms and the principal purpose for the payment is | ||||||
13 | not federal or Illinois tax avoidance; or
| ||||||
14 | (iv) an item of interest paid, accrued, or | ||||||
15 | incurred, directly or indirectly, to a foreign | ||||||
16 | person if the taxpayer establishes by clear and | ||||||
17 | convincing evidence that the adjustments are | ||||||
18 | unreasonable; or if the taxpayer and the Director | ||||||
19 | agree in writing to the application or use of an | ||||||
20 | alternative method of apportionment under Section | ||||||
21 | 304(f).
| ||||||
22 | Nothing in this subsection shall preclude the | ||||||
23 | Director from making any other adjustment | ||||||
24 | otherwise allowed under Section 404 of this Act for | ||||||
25 | any tax year beginning after the effective date of | ||||||
26 | this amendment provided such adjustment is made |
| |||||||
| |||||||
1 | pursuant to regulation adopted by the Department | ||||||
2 | and such regulations provide methods and standards | ||||||
3 | by which the Department will utilize its authority | ||||||
4 | under Section 404 of this Act;
| ||||||
5 | (E-13) For taxable years ending on or after | ||||||
6 | December 31, 2004, an amount equal to the amount of | ||||||
7 | intangible expenses and costs otherwise allowed as a | ||||||
8 | deduction in computing base income, and that were paid, | ||||||
9 | accrued, or incurred, directly or indirectly, to a | ||||||
10 | foreign person who would be a member of the same | ||||||
11 | unitary business group but for the fact that the | ||||||
12 | foreign person's business activity outside the United | ||||||
13 | States is 80% or more of that person's total business | ||||||
14 | activity. The addition modification required by this | ||||||
15 | subparagraph shall be reduced to the extent that | ||||||
16 | dividends were included in base income of the unitary | ||||||
17 | group for the same taxable year and received by the | ||||||
18 | taxpayer or by a member of the taxpayer's unitary | ||||||
19 | business group (including amounts included in gross | ||||||
20 | income pursuant to Sections 951 through 964 of the | ||||||
21 | Internal Revenue Code and amounts included in gross | ||||||
22 | income under Section 78 of the Internal Revenue Code) | ||||||
23 | with respect to the stock of the same person to whom | ||||||
24 | the intangible expenses and costs were directly or | ||||||
25 | indirectly paid, incurred, or accrued. The preceding | ||||||
26 | sentence shall not apply to the extent that the same |
| |||||||
| |||||||
1 | dividends caused a reduction to the addition | ||||||
2 | modification required under Section 203(b)(2)(E-12) of | ||||||
3 | this Act.
As used in this subparagraph, the term | ||||||
4 | "intangible expenses and costs" includes (1) expenses, | ||||||
5 | losses, and costs for, or related to, the direct or | ||||||
6 | indirect acquisition, use, maintenance or management, | ||||||
7 | ownership, sale, exchange, or any other disposition of | ||||||
8 | intangible property; (2) losses incurred, directly or | ||||||
9 | indirectly, from factoring transactions or discounting | ||||||
10 | transactions; (3) royalty, patent, technical, and | ||||||
11 | copyright fees; (4) licensing fees; and (5) other | ||||||
12 | similar expenses and costs.
For purposes of this | ||||||
13 | subparagraph, "intangible property" includes patents, | ||||||
14 | patent applications, trade names, trademarks, service | ||||||
15 | marks, copyrights, mask works, trade secrets, and | ||||||
16 | similar types of intangible assets. | ||||||
17 | This paragraph shall not apply to the following: | ||||||
18 | (i) any item of intangible expenses or costs | ||||||
19 | paid, accrued, or incurred, directly or | ||||||
20 | indirectly, from a transaction with a foreign | ||||||
21 | person who is subject in a foreign country or | ||||||
22 | state, other than a state which requires mandatory | ||||||
23 | unitary reporting, to a tax on or measured by net | ||||||
24 | income with respect to such item; or | ||||||
25 | (ii) any item of intangible expense or cost | ||||||
26 | paid, accrued, or incurred, directly or |
| |||||||
| |||||||
1 | indirectly, if the taxpayer can establish, based | ||||||
2 | on a preponderance of the evidence, both of the | ||||||
3 | following: | ||||||
4 | (a) the foreign person during the same | ||||||
5 | taxable year paid, accrued, or incurred, the | ||||||
6 | intangible expense or cost to a person that is | ||||||
7 | not a related member, and | ||||||
8 | (b) the transaction giving rise to the | ||||||
9 | intangible expense or cost between the | ||||||
10 | taxpayer and the foreign person did not have as | ||||||
11 | a principal purpose the avoidance of Illinois | ||||||
12 | income tax, and is paid pursuant to a contract | ||||||
13 | or agreement that reflects arm's-length terms; | ||||||
14 | or | ||||||
15 | (iii) any item of intangible expense or cost | ||||||
16 | paid, accrued, or incurred, directly or | ||||||
17 | indirectly, from a transaction with a foreign | ||||||
18 | person if the taxpayer establishes by clear and | ||||||
19 | convincing evidence, that the adjustments are | ||||||
20 | unreasonable; or if the taxpayer and the Director | ||||||
21 | agree in writing to the application or use of an | ||||||
22 | alternative method of apportionment under Section | ||||||
23 | 304(f);
| ||||||
24 | Nothing in this subsection shall preclude the | ||||||
25 | Director from making any other adjustment | ||||||
26 | otherwise allowed under Section 404 of this Act for |
| |||||||
| |||||||
1 | any tax year beginning after the effective date of | ||||||
2 | this amendment provided such adjustment is made | ||||||
3 | pursuant to regulation adopted by the Department | ||||||
4 | and such regulations provide methods and standards | ||||||
5 | by which the Department will utilize its authority | ||||||
6 | under Section 404 of this Act;
| ||||||
7 | and by deducting from the total so obtained the sum of the | ||||||
8 | following
amounts:
| ||||||
9 | (F) An amount equal to the amount of any tax | ||||||
10 | imposed by this Act
which was refunded to the taxpayer | ||||||
11 | and included in such total for the
taxable year;
| ||||||
12 | (G) An amount equal to any amount included in such | ||||||
13 | total under
Section 78 of the Internal Revenue Code;
| ||||||
14 | (H) In the case of a regulated investment company, | ||||||
15 | an amount equal
to the amount of exempt interest | ||||||
16 | dividends as defined in subsection (b)
(5) of Section | ||||||
17 | 852 of the Internal Revenue Code, paid to shareholders
| ||||||
18 | for the taxable year;
| ||||||
19 | (I) With the exception of any amounts subtracted | ||||||
20 | under subparagraph
(J),
an amount equal to the sum of | ||||||
21 | all amounts disallowed as
deductions by (i) Sections | ||||||
22 | 171(a) (2), and 265(a)(2) and amounts disallowed as
| ||||||
23 | interest expense by Section 291(a)(3) of the Internal | ||||||
24 | Revenue Code, as now
or hereafter amended, and all | ||||||
25 | amounts of expenses allocable to interest and
| ||||||
26 | disallowed as deductions by Section 265(a)(1) of the |
| |||||||
| |||||||
1 | Internal Revenue Code,
as now or hereafter amended;
and | ||||||
2 | (ii) for taxable years
ending on or after August 13, | ||||||
3 | 1999, Sections
171(a)(2), 265,
280C, 291(a)(3), and | ||||||
4 | 832(b)(5)(B)(i) of the Internal Revenue Code; the
| ||||||
5 | provisions of this
subparagraph are exempt from the | ||||||
6 | provisions of Section 250;
| ||||||
7 | (J) An amount equal to all amounts included in such | ||||||
8 | total which are
exempt from taxation by this State | ||||||
9 | either by reason of its statutes or
Constitution
or by | ||||||
10 | reason of the Constitution, treaties or statutes of the | ||||||
11 | United States;
provided that, in the case of any | ||||||
12 | statute of this State that exempts income
derived from | ||||||
13 | bonds or other obligations from the tax imposed under | ||||||
14 | this Act,
the amount exempted shall be the interest net | ||||||
15 | of bond premium amortization;
| ||||||
16 | (K) (Blank);
An amount equal to those dividends | ||||||
17 | included in such total
which were paid by a corporation | ||||||
18 | which conducts
business operations in an Enterprise | ||||||
19 | Zone or zones created under
the Illinois Enterprise | ||||||
20 | Zone Act or a River Edge Redevelopment Zone or zones | ||||||
21 | created under the River Edge Redevelopment Zone Act and | ||||||
22 | conducts substantially all of its
operations in an | ||||||
23 | Enterprise Zone or zones or a River Edge Redevelopment | ||||||
24 | Zone or zones. This subparagraph (K) is exempt from the | ||||||
25 | provisions of Section 250;
| ||||||
26 | (L) (Blank);
An amount equal to those dividends |
| |||||||
| |||||||
1 | included in such total that
were paid by a corporation | ||||||
2 | that conducts business operations in a federally
| ||||||
3 | designated Foreign Trade Zone or Sub-Zone and that is | ||||||
4 | designated a High Impact
Business located in Illinois; | ||||||
5 | provided that dividends eligible for the
deduction | ||||||
6 | provided in subparagraph (K) of paragraph 2 of this | ||||||
7 | subsection
shall not be eligible for the deduction | ||||||
8 | provided under this subparagraph
(L);
| ||||||
9 | (M) For any taxpayer that is a financial | ||||||
10 | organization within the meaning
of Section 304(c) of | ||||||
11 | this Act, an amount included in such total as interest
| ||||||
12 | income from a loan or loans made by such taxpayer to a | ||||||
13 | borrower, to the extent
that such a loan is secured by | ||||||
14 | property which is eligible for the Enterprise
Zone | ||||||
15 | Investment Credit or the River Edge Redevelopment Zone | ||||||
16 | Investment Credit. To determine the portion of a loan | ||||||
17 | or loans that is
secured by property eligible for a | ||||||
18 | Section 201(f) investment
credit to the borrower, the | ||||||
19 | entire principal amount of the loan or loans
between | ||||||
20 | the taxpayer and the borrower should be divided into | ||||||
21 | the basis of the
Section 201(f) investment credit | ||||||
22 | property which secures the
loan or loans, using for | ||||||
23 | this purpose the original basis of such property on
the | ||||||
24 | date that it was placed in service in the
Enterprise | ||||||
25 | Zone or the River Edge Redevelopment Zone. The | ||||||
26 | subtraction modification available to taxpayer in any
|
| |||||||
| |||||||
1 | year under this subsection shall be that portion of the | ||||||
2 | total interest paid
by the borrower with respect to | ||||||
3 | such loan attributable to the eligible
property as | ||||||
4 | calculated under the previous sentence. This | ||||||
5 | subparagraph (M) is exempt from the provisions of | ||||||
6 | Section 250;
| ||||||
7 | (M-1) For any taxpayer that is a financial | ||||||
8 | organization within the
meaning of Section 304(c) of | ||||||
9 | this Act, an amount included in such total as
interest | ||||||
10 | income from a loan or loans made by such taxpayer to a | ||||||
11 | borrower,
to the extent that such a loan is secured by | ||||||
12 | property which is eligible for
the High Impact Business | ||||||
13 | Investment Credit. To determine the portion of a
loan | ||||||
14 | or loans that is secured by property eligible for a | ||||||
15 | Section 201(h) investment credit to the borrower, the | ||||||
16 | entire principal amount of
the loan or loans between | ||||||
17 | the taxpayer and the borrower should be divided into
| ||||||
18 | the basis of the Section 201(h) investment credit | ||||||
19 | property which
secures the loan or loans, using for | ||||||
20 | this purpose the original basis of such
property on the | ||||||
21 | date that it was placed in service in a federally | ||||||
22 | designated
Foreign Trade Zone or Sub-Zone located in | ||||||
23 | Illinois. No taxpayer that is
eligible for the | ||||||
24 | deduction provided in subparagraph (M) of paragraph | ||||||
25 | (2) of
this subsection shall be eligible for the | ||||||
26 | deduction provided under this
subparagraph (M-1). The |
| |||||||
| |||||||
1 | subtraction modification available to taxpayers in
any | ||||||
2 | year under this subsection shall be that portion of the | ||||||
3 | total interest
paid by the borrower with respect to | ||||||
4 | such loan attributable to the eligible
property as | ||||||
5 | calculated under the previous sentence;
| ||||||
6 | (N) Two times any contribution made during the | ||||||
7 | taxable year to a
designated zone organization to the | ||||||
8 | extent that the contribution (i)
qualifies as a | ||||||
9 | charitable contribution under subsection (c) of | ||||||
10 | Section 170
of the Internal Revenue Code and (ii) must, | ||||||
11 | by its terms, be used for a
project approved by the | ||||||
12 | Department of Commerce and Economic Opportunity under | ||||||
13 | Section 11 of the Illinois Enterprise Zone Act or under | ||||||
14 | Section 10-10 of the Illinois River Edge Redevelopment | ||||||
15 | Zone Act. This subparagraph (N) is exempt from the | ||||||
16 | provisions of Section 250;
| ||||||
17 | (O) An amount equal to: (i) 85% for taxable years | ||||||
18 | ending on or before
December 31, 1992, or, a percentage | ||||||
19 | equal to the percentage allowable under
Section | ||||||
20 | 243(a)(1) of the Internal Revenue Code of 1986 for | ||||||
21 | taxable years ending
after December 31, 1992, of the | ||||||
22 | amount by which dividends included in taxable
income | ||||||
23 | and received from a corporation that is not created or | ||||||
24 | organized under
the laws of the United States or any | ||||||
25 | state or political subdivision thereof,
including, for | ||||||
26 | taxable years ending on or after December 31, 1988, |
| |||||||
| |||||||
1 | dividends
received or deemed received or paid or deemed | ||||||
2 | paid under Sections 951 through
964 of the Internal | ||||||
3 | Revenue Code, exceed the amount of the modification
| ||||||
4 | provided under subparagraph (G) of paragraph (2) of | ||||||
5 | this subsection (b) which
is related to such dividends; | ||||||
6 | plus (ii) 100% of the amount by which dividends,
| ||||||
7 | included in taxable income and received, including, | ||||||
8 | for taxable years ending on
or after December 31, 1988, | ||||||
9 | dividends received or deemed received or paid or
deemed | ||||||
10 | paid under Sections 951 through 964 of the Internal | ||||||
11 | Revenue Code, from
any such corporation specified in | ||||||
12 | clause (i) that would but for the provisions
of Section | ||||||
13 | 1504 (b) (3) of the Internal Revenue Code be treated as | ||||||
14 | a member of
the affiliated group which includes the | ||||||
15 | dividend recipient, exceed the amount
of the | ||||||
16 | modification provided under subparagraph (G) of | ||||||
17 | paragraph (2) of this
subsection (b) which is related | ||||||
18 | to such dividends;
| ||||||
19 | (P) An amount equal to any contribution made to a | ||||||
20 | job training project
established pursuant to the Tax | ||||||
21 | Increment Allocation Redevelopment Act;
| ||||||
22 | (Q) An amount equal to the amount of the deduction | ||||||
23 | used to compute the
federal income tax credit for | ||||||
24 | restoration of substantial amounts held under
claim of | ||||||
25 | right for the taxable year pursuant to Section 1341 of | ||||||
26 | the
Internal Revenue Code of 1986;
|
| |||||||
| |||||||
1 | (R) On and after July 20, 1999, in the case of an | ||||||
2 | attorney-in-fact with respect to whom an
interinsurer | ||||||
3 | or a reciprocal insurer has made the election under | ||||||
4 | Section 835 of
the Internal Revenue Code, 26 U.S.C. | ||||||
5 | 835, an amount equal to the excess, if
any, of the | ||||||
6 | amounts paid or incurred by that interinsurer or | ||||||
7 | reciprocal insurer
in the taxable year to the | ||||||
8 | attorney-in-fact over the deduction allowed to that
| ||||||
9 | interinsurer or reciprocal insurer with respect to the | ||||||
10 | attorney-in-fact under
Section 835(b) of the Internal | ||||||
11 | Revenue Code for the taxable year; the provisions of | ||||||
12 | this subparagraph are exempt from the provisions of | ||||||
13 | Section 250;
| ||||||
14 | (S) For taxable years ending on or after December | ||||||
15 | 31, 1997, in the
case of a Subchapter
S corporation, an | ||||||
16 | amount equal to all amounts of income allocable to a
| ||||||
17 | shareholder subject to the Personal Property Tax | ||||||
18 | Replacement Income Tax imposed
by subsections (c) and | ||||||
19 | (d) of Section 201 of this Act, including amounts
| ||||||
20 | allocable to organizations exempt from federal income | ||||||
21 | tax by reason of Section
501(a) of the Internal Revenue | ||||||
22 | Code. This subparagraph (S) is exempt from
the | ||||||
23 | provisions of Section 250;
| ||||||
24 | (T) For taxable years 2001 and thereafter, for the | ||||||
25 | taxable year in
which the bonus depreciation deduction
| ||||||
26 | is taken on the taxpayer's federal income tax return |
| |||||||
| |||||||
1 | under
subsection (k) of Section 168 of the Internal | ||||||
2 | Revenue Code and for each
applicable taxable year | ||||||
3 | thereafter, an amount equal to "x", where:
| ||||||
4 | (1) "y" equals the amount of the depreciation | ||||||
5 | deduction taken for the
taxable year
on the | ||||||
6 | taxpayer's federal income tax return on property | ||||||
7 | for which the bonus
depreciation deduction
was | ||||||
8 | taken in any year under subsection (k) of Section | ||||||
9 | 168 of the Internal
Revenue Code, but not including | ||||||
10 | the bonus depreciation deduction;
| ||||||
11 | (2) for taxable years ending on or before | ||||||
12 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
13 | and then divided by 70 (or "y"
multiplied by | ||||||
14 | 0.429); and | ||||||
15 | (3) for taxable years ending after December | ||||||
16 | 31, 2005: | ||||||
17 | (i) for property on which a bonus | ||||||
18 | depreciation deduction of 30% of the adjusted | ||||||
19 | basis was taken, "x" equals "y" multiplied by | ||||||
20 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
21 | 0.429); and | ||||||
22 | (ii) for property on which a bonus | ||||||
23 | depreciation deduction of 50% of the adjusted | ||||||
24 | basis was taken, "x" equals "y" multiplied by | ||||||
25 | 1.0.
| ||||||
26 | The aggregate amount deducted under this |
| |||||||
| |||||||
1 | subparagraph in all taxable
years for any one piece of | ||||||
2 | property may not exceed the amount of the bonus
| ||||||
3 | depreciation deduction
taken on that property on the | ||||||
4 | taxpayer's federal income tax return under
subsection | ||||||
5 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
6 | subparagraph (T) is exempt from the provisions of | ||||||
7 | Section 250;
| ||||||
8 | (U) If the taxpayer sells, transfers, abandons, or | ||||||
9 | otherwise disposes of
property for which the taxpayer | ||||||
10 | was required in any taxable year to make an
addition | ||||||
11 | modification under subparagraph (E-10), then an amount | ||||||
12 | equal to that
addition modification.
| ||||||
13 | If the taxpayer continues to own property through | ||||||
14 | the last day of the last tax year for which the | ||||||
15 | taxpayer may claim a depreciation deduction for | ||||||
16 | federal income tax purposes and for which the taxpayer | ||||||
17 | was required in any taxable year to make an addition | ||||||
18 | modification under subparagraph (E-10), then an amount | ||||||
19 | equal to that addition modification.
| ||||||
20 | The taxpayer is allowed to take the deduction under | ||||||
21 | this subparagraph
only once with respect to any one | ||||||
22 | piece of property. | ||||||
23 | This subparagraph (U) is exempt from the | ||||||
24 | provisions of Section 250;
| ||||||
25 | (V) The amount of: (i) any interest income (net of | ||||||
26 | the deductions allocable thereto) taken into account |
| |||||||
| |||||||
1 | for the taxable year with respect to a transaction with | ||||||
2 | a taxpayer that is required to make an addition | ||||||
3 | modification with respect to such transaction under | ||||||
4 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
5 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
6 | the amount of such addition modification and
(ii) any | ||||||
7 | income from intangible property (net of the deductions | ||||||
8 | allocable thereto) taken into account for the taxable | ||||||
9 | year with respect to a transaction with a taxpayer that | ||||||
10 | is required to make an addition modification with | ||||||
11 | respect to such transaction under Section | ||||||
12 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
13 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
14 | addition modification;
| ||||||
15 | (W) An amount equal to the interest income taken | ||||||
16 | into account for the taxable year (net of the | ||||||
17 | deductions allocable thereto) with respect to | ||||||
18 | transactions with a foreign person who would be a | ||||||
19 | member of the taxpayer's unitary business group but for | ||||||
20 | the fact that the foreign person's business activity | ||||||
21 | outside the United States is 80% or more of that | ||||||
22 | person's total business activity, but not to exceed the | ||||||
23 | addition modification required to be made for the same | ||||||
24 | taxable year under Section 203(b)(2)(E-12) for | ||||||
25 | interest paid, accrued, or incurred, directly or | ||||||
26 | indirectly, to the same foreign person; and
|
| |||||||
| |||||||
1 | (X) An amount equal to the income from intangible | ||||||
2 | property taken into account for the taxable year (net | ||||||
3 | of the deductions allocable thereto) with respect to | ||||||
4 | transactions with a foreign person who would be a | ||||||
5 | member of the taxpayer's unitary business group but for | ||||||
6 | the fact that the foreign person's business activity | ||||||
7 | outside the United States is 80% or more of that | ||||||
8 | person's total business activity, but not to exceed the | ||||||
9 | addition modification required to be made for the same | ||||||
10 | taxable year under Section 203(b)(2)(E-13) for | ||||||
11 | intangible expenses and costs paid, accrued, or | ||||||
12 | incurred, directly or indirectly, to the same foreign | ||||||
13 | person.
| ||||||
14 | (3) Special rule. For purposes of paragraph (2) (A), | ||||||
15 | "gross income"
in the case of a life insurance company, for | ||||||
16 | tax years ending on and after
December 31, 1994,
shall mean | ||||||
17 | the gross investment income for the taxable year.
| ||||||
18 | (c) Trusts and estates.
| ||||||
19 | (1) In general. In the case of a trust or estate, base | ||||||
20 | income means
an amount equal to the taxpayer's taxable | ||||||
21 | income for the taxable year as
modified by paragraph (2).
| ||||||
22 | (2) Modifications. Subject to the provisions of | ||||||
23 | paragraph (3), the
taxable income referred to in paragraph | ||||||
24 | (1) shall be modified by adding
thereto the sum of the | ||||||
25 | following amounts:
|
| |||||||
| |||||||
1 | (A) An amount equal to all amounts paid or accrued | ||||||
2 | to the taxpayer
as interest or dividends during the | ||||||
3 | taxable year to the extent excluded
from gross income | ||||||
4 | in the computation of taxable income;
| ||||||
5 | (B) In the case of (i) an estate, $600; (ii) a | ||||||
6 | trust which, under
its governing instrument, is | ||||||
7 | required to distribute all of its income
currently, | ||||||
8 | $300; and (iii) any other trust, $100, but in each such | ||||||
9 | case,
only to the extent such amount was deducted in | ||||||
10 | the computation of
taxable income;
| ||||||
11 | (C) An amount equal to the amount of tax imposed by | ||||||
12 | this Act to the
extent deducted from gross income in | ||||||
13 | the computation of taxable income
for the taxable year;
| ||||||
14 | (D) The amount of any net operating loss deduction | ||||||
15 | taken in arriving at
taxable income, other than a net | ||||||
16 | operating loss carried forward from a
taxable year | ||||||
17 | ending prior to December 31, 1986;
| ||||||
18 | (E) For taxable years in which a net operating loss | ||||||
19 | carryback or
carryforward from a taxable year ending | ||||||
20 | prior to December 31, 1986 is an
element of taxable | ||||||
21 | income under paragraph (1) of subsection (e) or | ||||||
22 | subparagraph
(E) of paragraph (2) of subsection (e), | ||||||
23 | the amount by which addition
modifications other than | ||||||
24 | those provided by this subparagraph (E) exceeded
| ||||||
25 | subtraction modifications in such taxable year, with | ||||||
26 | the following limitations
applied in the order that |
| |||||||
| |||||||
1 | they are listed:
| ||||||
2 | (i) the addition modification relating to the | ||||||
3 | net operating loss
carried back or forward to the | ||||||
4 | taxable year from any taxable year ending
prior to | ||||||
5 | December 31, 1986 shall be reduced by the amount of | ||||||
6 | addition
modification under this subparagraph (E) | ||||||
7 | which related to that net
operating loss and which | ||||||
8 | was taken into account in calculating the base
| ||||||
9 | income of an earlier taxable year, and
| ||||||
10 | (ii) 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 not exceed the amount of | ||||||
14 | such carryback or
carryforward;
| ||||||
15 | For taxable years in which there is a net operating | ||||||
16 | loss carryback or
carryforward from more than one other | ||||||
17 | taxable year ending prior to December
31, 1986, the | ||||||
18 | addition modification provided in this subparagraph | ||||||
19 | (E) shall
be the sum of the amounts computed | ||||||
20 | independently under the preceding
provisions of this | ||||||
21 | subparagraph (E) for each such taxable year;
| ||||||
22 | (F) For taxable years ending on or after January 1, | ||||||
23 | 1989, an amount
equal to the tax deducted pursuant to | ||||||
24 | Section 164 of the Internal Revenue
Code if the trust | ||||||
25 | or estate is claiming the same tax for purposes of the
| ||||||
26 | Illinois foreign tax credit under Section 601 of this |
| |||||||
| |||||||
1 | Act;
| ||||||
2 | (G) An amount equal to the amount of the capital | ||||||
3 | gain deduction
allowable under the Internal Revenue | ||||||
4 | Code, to the extent deducted from
gross income in the | ||||||
5 | computation of taxable income;
| ||||||
6 | (G-5) For taxable years ending after December 31, | ||||||
7 | 1997, an
amount equal to any eligible remediation costs | ||||||
8 | that the trust or estate
deducted in computing adjusted | ||||||
9 | gross income and for which the trust
or estate claims a | ||||||
10 | credit under subsection (l) of Section 201;
| ||||||
11 | (G-10) For taxable years 2001 and thereafter, an | ||||||
12 | amount equal to the
bonus depreciation deduction taken | ||||||
13 | on the taxpayer's federal income tax return for the | ||||||
14 | taxable
year under subsection (k) of Section 168 of the | ||||||
15 | Internal Revenue Code; and
| ||||||
16 | (G-11) If the taxpayer sells, transfers, abandons, | ||||||
17 | or otherwise disposes of property for which the | ||||||
18 | taxpayer was required in any taxable year to
make an | ||||||
19 | addition modification under subparagraph (G-10), then | ||||||
20 | an amount equal
to the aggregate amount of the | ||||||
21 | deductions taken in all taxable
years under | ||||||
22 | subparagraph (R) with respect to that property.
| ||||||
23 | If the taxpayer continues to own property through | ||||||
24 | the last day of the last tax year for which the | ||||||
25 | taxpayer may claim a depreciation deduction for | ||||||
26 | federal income tax purposes and for which the taxpayer |
| |||||||
| |||||||
1 | was allowed in any taxable year to make a subtraction | ||||||
2 | modification under subparagraph (R), then an amount | ||||||
3 | equal to that subtraction modification.
| ||||||
4 | The taxpayer is required to make the addition | ||||||
5 | modification under this
subparagraph
only once with | ||||||
6 | respect to any one piece of property;
| ||||||
7 | (G-12) For taxable years ending on or after | ||||||
8 | December 31, 2004, an amount equal to the amount | ||||||
9 | otherwise allowed as a deduction in computing base | ||||||
10 | income for interest paid, accrued, or incurred, | ||||||
11 | directly or indirectly, to a foreign person who would | ||||||
12 | be a member of the same unitary business group but for | ||||||
13 | the fact that the foreign person's business activity | ||||||
14 | outside the United States is 80% or more of the foreign | ||||||
15 | person's total business activity. The addition | ||||||
16 | modification required by this subparagraph shall be | ||||||
17 | reduced to the extent that dividends were included in | ||||||
18 | base income of the unitary group for the same taxable | ||||||
19 | year and received by the taxpayer or by a member of the | ||||||
20 | taxpayer's unitary business group (including amounts | ||||||
21 | included in gross income pursuant to Sections 951 | ||||||
22 | through 964 of the Internal Revenue Code and amounts | ||||||
23 | included in gross income under Section 78 of the | ||||||
24 | Internal Revenue Code) with respect to the stock of the | ||||||
25 | same person to whom the interest was paid, accrued, or | ||||||
26 | incurred.
|
| |||||||
| |||||||
1 | This paragraph shall not apply to the following:
| ||||||
2 | (i) an item of interest paid, accrued, or | ||||||
3 | incurred, directly or indirectly, to a foreign | ||||||
4 | person who is subject in a foreign country or | ||||||
5 | state, other than a state which requires mandatory | ||||||
6 | unitary reporting, to a tax on or measured by net | ||||||
7 | income with respect to such interest; or | ||||||
8 | (ii) an item of interest paid, accrued, or | ||||||
9 | incurred, directly or indirectly, to a foreign | ||||||
10 | person if the taxpayer can establish, based on a | ||||||
11 | preponderance of the evidence, both of the | ||||||
12 | following: | ||||||
13 | (a) the foreign person, during the same | ||||||
14 | taxable year, paid, accrued, or incurred, the | ||||||
15 | interest to a person that is not a related | ||||||
16 | member, and | ||||||
17 | (b) the transaction giving rise to the | ||||||
18 | interest expense between the taxpayer and the | ||||||
19 | foreign person did not have as a principal | ||||||
20 | purpose the avoidance of Illinois income tax, | ||||||
21 | and is paid pursuant to a contract or agreement | ||||||
22 | that reflects an arm's-length interest rate | ||||||
23 | and terms; or
| ||||||
24 | (iii) the taxpayer can establish, based on | ||||||
25 | clear and convincing evidence, that the interest | ||||||
26 | paid, accrued, or incurred relates to a contract or |
| |||||||
| |||||||
1 | agreement entered into at arm's-length rates and | ||||||
2 | terms and the principal purpose for the payment is | ||||||
3 | not federal or Illinois tax avoidance; or
| ||||||
4 | (iv) an item of interest paid, accrued, or | ||||||
5 | incurred, directly or indirectly, to a foreign | ||||||
6 | person if the taxpayer establishes by clear and | ||||||
7 | convincing evidence that the adjustments are | ||||||
8 | unreasonable; or if the taxpayer and the Director | ||||||
9 | agree in writing to the application or use of an | ||||||
10 | alternative method of apportionment under Section | ||||||
11 | 304(f).
| ||||||
12 | Nothing in this subsection shall preclude the | ||||||
13 | Director from making any other adjustment | ||||||
14 | otherwise allowed under Section 404 of this Act for | ||||||
15 | any tax year beginning after the effective date of | ||||||
16 | this amendment provided such adjustment is made | ||||||
17 | pursuant to regulation adopted by the Department | ||||||
18 | and such regulations provide methods and standards | ||||||
19 | by which the Department will utilize its authority | ||||||
20 | under Section 404 of this Act;
| ||||||
21 | (G-13) For taxable years ending on or after | ||||||
22 | December 31, 2004, an amount equal to the amount of | ||||||
23 | intangible expenses and costs otherwise allowed as a | ||||||
24 | deduction in computing base income, and that were paid, | ||||||
25 | accrued, or incurred, directly or indirectly, to a | ||||||
26 | foreign person who would be a member of the same |
| |||||||
| |||||||
1 | unitary business group but for the fact that the | ||||||
2 | foreign person's business activity outside the United | ||||||
3 | States is 80% or more of that person's total business | ||||||
4 | activity. The addition modification required by this | ||||||
5 | subparagraph shall be reduced to the extent that | ||||||
6 | dividends were included in base income of the unitary | ||||||
7 | group for the same taxable year and received by the | ||||||
8 | taxpayer or by a member of the taxpayer's unitary | ||||||
9 | business group (including amounts included in gross | ||||||
10 | income pursuant to Sections 951 through 964 of the | ||||||
11 | Internal Revenue Code and amounts included in gross | ||||||
12 | income under Section 78 of the Internal Revenue Code) | ||||||
13 | with respect to the stock of the same person to whom | ||||||
14 | the intangible expenses and costs were directly or | ||||||
15 | indirectly paid, incurred, or accrued. The preceding | ||||||
16 | sentence shall not apply to the extent that the same | ||||||
17 | dividends caused a reduction to the addition | ||||||
18 | modification required under Section 203(c)(2)(G-12) of | ||||||
19 | this Act. As used in this subparagraph, the term | ||||||
20 | "intangible expenses and costs" includes: (1) | ||||||
21 | expenses, losses, and costs for or related to the | ||||||
22 | direct or indirect acquisition, use, maintenance or | ||||||
23 | management, ownership, sale, exchange, or any other | ||||||
24 | disposition of intangible property; (2) losses | ||||||
25 | incurred, directly or indirectly, from factoring | ||||||
26 | transactions or discounting transactions; (3) royalty, |
| |||||||
| |||||||
1 | patent, technical, and copyright fees; (4) licensing | ||||||
2 | fees; and (5) other similar expenses and costs. For | ||||||
3 | purposes of this subparagraph, "intangible property" | ||||||
4 | includes patents, patent applications, trade names, | ||||||
5 | trademarks, service marks, copyrights, mask works, | ||||||
6 | trade secrets, and similar types of intangible assets. | ||||||
7 | This paragraph shall not apply to the following: | ||||||
8 | (i) any item of intangible expenses or costs | ||||||
9 | paid, accrued, or incurred, directly or | ||||||
10 | indirectly, from a transaction with a foreign | ||||||
11 | person who is subject in a foreign country or | ||||||
12 | state, other than a state which requires mandatory | ||||||
13 | unitary reporting, to a tax on or measured by net | ||||||
14 | income with respect to such item; or | ||||||
15 | (ii) any item of intangible expense or cost | ||||||
16 | paid, accrued, or incurred, directly or | ||||||
17 | indirectly, if the taxpayer can establish, based | ||||||
18 | on a preponderance of the evidence, both of the | ||||||
19 | following: | ||||||
20 | (a) the foreign person during the same | ||||||
21 | taxable year paid, accrued, or incurred, the | ||||||
22 | intangible expense or cost to a person that is | ||||||
23 | not a related member, and | ||||||
24 | (b) the transaction giving rise to the | ||||||
25 | intangible expense or cost between the | ||||||
26 | taxpayer and the foreign person did not have as |
| |||||||
| |||||||
1 | a principal purpose the avoidance of Illinois | ||||||
2 | income tax, and is paid pursuant to a contract | ||||||
3 | or agreement that reflects arm's-length terms; | ||||||
4 | or | ||||||
5 | (iii) any item of intangible expense or cost | ||||||
6 | paid, accrued, or incurred, directly or | ||||||
7 | indirectly, from a transaction with a foreign | ||||||
8 | person if the taxpayer establishes by clear and | ||||||
9 | convincing evidence, that the adjustments are | ||||||
10 | unreasonable; or if the taxpayer and the Director | ||||||
11 | agree in writing to the application or use of an | ||||||
12 | alternative method of apportionment under Section | ||||||
13 | 304(f);
| ||||||
14 | Nothing in this subsection shall preclude the | ||||||
15 | Director from making any other adjustment | ||||||
16 | otherwise allowed under Section 404 of this Act for | ||||||
17 | any tax year beginning after the effective date of | ||||||
18 | this amendment provided such adjustment is made | ||||||
19 | pursuant to regulation adopted by the Department | ||||||
20 | and such regulations provide methods and standards | ||||||
21 | by which the Department will utilize its authority | ||||||
22 | under Section 404 of this Act;
| ||||||
23 | and by deducting from the total so obtained the sum of the | ||||||
24 | following
amounts:
| ||||||
25 | (H) An amount equal to all amounts included in such | ||||||
26 | total pursuant
to the provisions of Sections 402(a), |
| |||||||
| |||||||
1 | 402(c), 403(a), 403(b), 406(a), 407(a)
and 408 of the | ||||||
2 | Internal Revenue Code or included in such total as
| ||||||
3 | distributions under the provisions of any retirement | ||||||
4 | or disability plan for
employees of any governmental | ||||||
5 | agency or unit, or retirement payments to
retired | ||||||
6 | partners, which payments are excluded in computing net | ||||||
7 | earnings
from self employment by Section 1402 of the | ||||||
8 | Internal Revenue Code and
regulations adopted pursuant | ||||||
9 | thereto;
| ||||||
10 | (I) The valuation limitation amount;
| ||||||
11 | (J) An amount equal to the amount of any tax | ||||||
12 | imposed by this Act
which was refunded to the taxpayer | ||||||
13 | and included in such total for the
taxable year;
| ||||||
14 | (K) An amount equal to all amounts included in | ||||||
15 | taxable income as
modified by subparagraphs (A), (B), | ||||||
16 | (C), (D), (E), (F) and (G) which
are exempt from | ||||||
17 | taxation by this State either by reason of its statutes | ||||||
18 | or
Constitution
or by reason of the Constitution, | ||||||
19 | treaties or statutes of the United States;
provided | ||||||
20 | that, in the case of any statute of this State that | ||||||
21 | exempts income
derived from bonds or other obligations | ||||||
22 | from the tax imposed under this Act,
the amount | ||||||
23 | exempted shall be the interest net of bond premium | ||||||
24 | amortization;
| ||||||
25 | (L) With the exception of any amounts subtracted | ||||||
26 | under subparagraph
(K),
an amount equal to the sum of |
| |||||||
| |||||||
1 | all amounts disallowed as
deductions by (i) Sections | ||||||
2 | 171(a) (2) and 265(a)(2) of the Internal Revenue
Code, | ||||||
3 | as now or hereafter amended, and all amounts of | ||||||
4 | expenses allocable
to interest and disallowed as | ||||||
5 | deductions by Section 265(1) of the Internal
Revenue | ||||||
6 | Code of 1954, as now or hereafter amended;
and (ii) for | ||||||
7 | taxable years
ending on or after August 13, 1999, | ||||||
8 | Sections
171(a)(2), 265,
280C, and 832(b)(5)(B)(i) of | ||||||
9 | the Internal Revenue Code; the provisions of this
| ||||||
10 | subparagraph are exempt from the provisions of Section | ||||||
11 | 250;
| ||||||
12 | (M) An amount equal to those dividends included in | ||||||
13 | such total
which were paid by a corporation which | ||||||
14 | conducts business operations in an
Enterprise Zone or | ||||||
15 | zones created under the Illinois Enterprise Zone Act or | ||||||
16 | a River Edge Redevelopment Zone or zones created under | ||||||
17 | the River Edge Redevelopment Zone Act and
conducts | ||||||
18 | substantially all of its operations in an Enterprise | ||||||
19 | Zone or Zones or a River Edge Redevelopment Zone or | ||||||
20 | zones. This subparagraph (M) is exempt from the | ||||||
21 | provisions of Section 250;
| ||||||
22 | (N) An amount equal to any contribution made to a | ||||||
23 | job training
project established pursuant to the Tax | ||||||
24 | Increment Allocation
Redevelopment Act;
| ||||||
25 | (O) An amount equal to those dividends included in | ||||||
26 | such total
that were paid by a corporation that |
| |||||||
| |||||||
1 | conducts business operations in a
federally designated | ||||||
2 | Foreign Trade Zone or Sub-Zone and that is designated
a | ||||||
3 | High Impact Business located in Illinois; provided | ||||||
4 | that dividends eligible
for the deduction provided in | ||||||
5 | subparagraph (M) of paragraph (2) of this
subsection | ||||||
6 | shall not be eligible for the deduction provided under | ||||||
7 | this
subparagraph (O);
| ||||||
8 | (P) An amount equal to the amount of the deduction | ||||||
9 | used to compute the
federal income tax credit for | ||||||
10 | restoration of substantial amounts held under
claim of | ||||||
11 | right for the taxable year pursuant to Section 1341 of | ||||||
12 | the
Internal Revenue Code of 1986;
| ||||||
13 | (Q) For taxable year 1999 and thereafter, an amount | ||||||
14 | equal to the
amount of any
(i) distributions, to the | ||||||
15 | extent includible in gross income for
federal income | ||||||
16 | tax purposes, made to the taxpayer because of
his or | ||||||
17 | her status as a victim of
persecution for racial or | ||||||
18 | religious reasons by Nazi Germany or any other Axis
| ||||||
19 | regime or as an heir of the victim and (ii) items
of | ||||||
20 | income, to the extent
includible in gross income for | ||||||
21 | federal income tax purposes, attributable to,
derived | ||||||
22 | from or in any way related to assets stolen from, | ||||||
23 | hidden from, or
otherwise lost to a victim of
| ||||||
24 | persecution for racial or religious reasons by Nazi
| ||||||
25 | Germany or any other Axis regime
immediately prior to, | ||||||
26 | during, and immediately after World War II, including,
|
| |||||||
| |||||||
1 | but
not limited to, interest on the proceeds receivable | ||||||
2 | as insurance
under policies issued to a victim of | ||||||
3 | persecution for racial or religious
reasons by Nazi | ||||||
4 | Germany or any other Axis regime by European insurance
| ||||||
5 | companies
immediately prior to and during World War II;
| ||||||
6 | provided, however, this subtraction from federal | ||||||
7 | adjusted gross income does not
apply to assets acquired | ||||||
8 | with such assets or with the proceeds from the sale of
| ||||||
9 | such assets; provided, further, this paragraph shall | ||||||
10 | only apply to a taxpayer
who was the first recipient of | ||||||
11 | such assets after their recovery and who is a
victim of
| ||||||
12 | persecution for racial or religious reasons
by Nazi | ||||||
13 | Germany or any other Axis regime or as an heir of the | ||||||
14 | victim. The
amount of and the eligibility for any | ||||||
15 | public assistance, benefit, or
similar entitlement is | ||||||
16 | not affected by the inclusion of items (i) and (ii) of
| ||||||
17 | this paragraph in gross income for federal income tax | ||||||
18 | purposes.
This paragraph is exempt from the provisions | ||||||
19 | of Section 250;
| ||||||
20 | (R) For taxable years 2001 and thereafter, for the | ||||||
21 | taxable year in
which the bonus depreciation deduction
| ||||||
22 | is taken on the taxpayer's federal income tax return | ||||||
23 | under
subsection (k) of Section 168 of the Internal | ||||||
24 | Revenue Code and for each
applicable taxable year | ||||||
25 | thereafter, an amount equal to "x", where:
| ||||||
26 | (1) "y" equals the amount of the depreciation |
| |||||||
| |||||||
1 | deduction taken for the
taxable year
on the | ||||||
2 | taxpayer's federal income tax return on property | ||||||
3 | for which the bonus
depreciation deduction
was | ||||||
4 | taken in any year under subsection (k) of Section | ||||||
5 | 168 of the Internal
Revenue Code, but not including | ||||||
6 | the bonus depreciation deduction;
| ||||||
7 | (2) for taxable years ending on or before | ||||||
8 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
9 | and then divided by 70 (or "y"
multiplied by | ||||||
10 | 0.429); and | ||||||
11 | (3) for taxable years ending after December | ||||||
12 | 31, 2005: | ||||||
13 | (i) for property on which a bonus | ||||||
14 | depreciation deduction of 30% of the adjusted | ||||||
15 | basis was taken, "x" equals "y" multiplied by | ||||||
16 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
17 | 0.429); and | ||||||
18 | (ii) for property on which a bonus | ||||||
19 | depreciation deduction of 50% of the adjusted | ||||||
20 | basis was taken, "x" equals "y" multiplied by | ||||||
21 | 1.0.
| ||||||
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 the | ||||||
11 | taxpayer may claim a depreciation deduction for | ||||||
12 | federal income tax purposes and for which the taxpayer | ||||||
13 | was 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 under | ||||||
17 | this subparagraph
only once with respect to any one | ||||||
18 | 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 with | ||||||
24 | 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 that | ||||||
6 | 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;
| ||||||
11 | (U) An amount equal to the interest income taken | ||||||
12 | into account for the taxable year (net of the | ||||||
13 | deductions allocable thereto) with respect to | ||||||
14 | transactions with a foreign person who would be a | ||||||
15 | member of the taxpayer's unitary business group but for | ||||||
16 | the fact the foreign person's business activity | ||||||
17 | outside the United States is 80% or more of that | ||||||
18 | person's total business activity, but not to exceed the | ||||||
19 | addition modification required to be made for the same | ||||||
20 | taxable year under Section 203(c)(2)(G-12) for | ||||||
21 | interest paid, accrued, or incurred, directly or | ||||||
22 | indirectly, to the same foreign person; and
| ||||||
23 | (V) An amount equal to the income from intangible | ||||||
24 | property taken into account for the taxable year (net | ||||||
25 | of the deductions allocable thereto) with respect to | ||||||
26 | transactions with a foreign person who would be a |
| |||||||
| |||||||
1 | member of the taxpayer's unitary business group but for | ||||||
2 | the fact that the foreign person's business activity | ||||||
3 | outside the United States is 80% or more of that | ||||||
4 | person's total business activity, but not to exceed the | ||||||
5 | addition modification required to be made for the same | ||||||
6 | taxable year under Section 203(c)(2)(G-13) for | ||||||
7 | intangible expenses and costs paid, accrued, or | ||||||
8 | incurred, directly or indirectly, to the same foreign | ||||||
9 | person.
| ||||||
10 | (3) Limitation. The amount of any modification | ||||||
11 | otherwise required
under this subsection shall, under | ||||||
12 | regulations prescribed by the
Department, be adjusted by | ||||||
13 | any amounts included therein which were
properly paid, | ||||||
14 | credited, or required to be distributed, or permanently set
| ||||||
15 | aside for charitable purposes pursuant to Internal Revenue | ||||||
16 | Code Section
642(c) during the taxable year.
| ||||||
17 | (d) Partnerships.
| ||||||
18 | (1) In general. In the case of a partnership, base | ||||||
19 | income means an
amount equal to the taxpayer's taxable | ||||||
20 | income for the taxable year as
modified by paragraph (2).
| ||||||
21 | (2) Modifications. The taxable income referred to in | ||||||
22 | paragraph (1)
shall be modified by adding thereto the sum | ||||||
23 | of the following amounts:
| ||||||
24 | (A) An amount equal to all amounts paid or accrued | ||||||
25 | to the taxpayer as
interest or dividends during the |
| |||||||
| |||||||
1 | taxable year to the extent excluded from
gross income | ||||||
2 | in the computation of taxable income;
| ||||||
3 | (B) An amount equal to the amount of tax imposed by | ||||||
4 | this Act to the
extent deducted from gross income for | ||||||
5 | the taxable year;
| ||||||
6 | (C) The amount of deductions allowed to the | ||||||
7 | partnership pursuant to
Section 707 (c) of the Internal | ||||||
8 | Revenue Code in calculating its taxable income;
| ||||||
9 | (D) An amount equal to the amount of the capital | ||||||
10 | gain deduction
allowable under the Internal Revenue | ||||||
11 | Code, to the extent deducted from
gross income in the | ||||||
12 | computation of taxable income;
| ||||||
13 | (D-5) For taxable years 2001 and thereafter, an | ||||||
14 | amount equal to the
bonus depreciation deduction taken | ||||||
15 | on the taxpayer's federal income tax return for the | ||||||
16 | taxable
year under subsection (k) of Section 168 of the | ||||||
17 | Internal Revenue Code;
| ||||||
18 | (D-6) If the taxpayer sells, transfers, abandons, | ||||||
19 | or otherwise disposes of
property for which the | ||||||
20 | taxpayer was required in any taxable year to make an
| ||||||
21 | addition modification under subparagraph (D-5), then | ||||||
22 | an amount equal to the
aggregate amount of the | ||||||
23 | deductions taken in all taxable years
under | ||||||
24 | subparagraph (O) with respect to that property.
| ||||||
25 | If the taxpayer continues to own property through | ||||||
26 | the last day of the last tax year for which the |
| |||||||
| |||||||
1 | taxpayer may claim a depreciation deduction for | ||||||
2 | federal income tax purposes and for which the taxpayer | ||||||
3 | was allowed in any taxable year to make a subtraction | ||||||
4 | modification under subparagraph (O), then an amount | ||||||
5 | equal to that subtraction modification.
| ||||||
6 | The taxpayer is required to make the addition | ||||||
7 | modification under this
subparagraph
only once with | ||||||
8 | respect to any one piece of property;
| ||||||
9 | (D-7) For taxable years ending on or after December | ||||||
10 | 31, 2004, 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, to a foreign person who would be a member | ||||||
14 | of the same unitary business group but for the fact the | ||||||
15 | foreign person's business activity outside the United | ||||||
16 | States is 80% or more of the foreign person's total | ||||||
17 | business activity. The addition modification required | ||||||
18 | by this subparagraph shall be reduced to the extent | ||||||
19 | that dividends were included in base income of the | ||||||
20 | unitary group for the same taxable year and received by | ||||||
21 | the taxpayer or by a member of the taxpayer's unitary | ||||||
22 | business group (including amounts included in gross | ||||||
23 | income pursuant to Sections 951 through 964 of the | ||||||
24 | Internal Revenue Code and amounts included in gross | ||||||
25 | income under Section 78 of the Internal Revenue Code) | ||||||
26 | with respect to the stock of the same person to whom |
| |||||||
| |||||||
1 | the interest was paid, accrued, or incurred.
| ||||||
2 | This paragraph shall not apply to the following:
| ||||||
3 | (i) an item of interest paid, accrued, or | ||||||
4 | incurred, directly or indirectly, to a foreign | ||||||
5 | person who is subject in a foreign country or | ||||||
6 | state, other than a state which requires mandatory | ||||||
7 | unitary reporting, to a tax on or measured by net | ||||||
8 | income with respect to such interest; or | ||||||
9 | (ii) an item of interest paid, accrued, or | ||||||
10 | incurred, directly or indirectly, to a foreign | ||||||
11 | person if the taxpayer can establish, based on a | ||||||
12 | preponderance of the evidence, both of the | ||||||
13 | following: | ||||||
14 | (a) the foreign person, during the same | ||||||
15 | taxable year, paid, accrued, or incurred, the | ||||||
16 | interest to a person that is not a related | ||||||
17 | member, and | ||||||
18 | (b) the transaction giving rise to the | ||||||
19 | interest expense between the taxpayer and the | ||||||
20 | foreign person did not have as a principal | ||||||
21 | purpose the avoidance of Illinois income tax, | ||||||
22 | and is paid pursuant to a contract or agreement | ||||||
23 | that reflects an arm's-length interest rate | ||||||
24 | and terms; or
| ||||||
25 | (iii) the taxpayer can establish, based on | ||||||
26 | clear and convincing evidence, that the interest |
| |||||||
| |||||||
1 | paid, accrued, or incurred relates to a contract or | ||||||
2 | agreement entered into at arm's-length rates and | ||||||
3 | terms and the principal purpose for the payment is | ||||||
4 | not federal or Illinois tax avoidance; or
| ||||||
5 | (iv) an item of interest paid, accrued, or | ||||||
6 | incurred, directly or indirectly, to a foreign | ||||||
7 | person if the taxpayer establishes by clear and | ||||||
8 | convincing evidence that the adjustments are | ||||||
9 | unreasonable; or if the taxpayer and the Director | ||||||
10 | agree in writing to the application or use of an | ||||||
11 | alternative method of apportionment under Section | ||||||
12 | 304(f).
| ||||||
13 | Nothing in this subsection shall preclude the | ||||||
14 | Director from making any other adjustment | ||||||
15 | otherwise allowed under Section 404 of this Act for | ||||||
16 | any tax year beginning after the effective date of | ||||||
17 | this amendment provided such adjustment is made | ||||||
18 | pursuant to regulation adopted by the Department | ||||||
19 | and such regulations provide methods and standards | ||||||
20 | by which the Department will utilize its authority | ||||||
21 | under Section 404 of this Act; and
| ||||||
22 | (D-8) For taxable years ending on or after December | ||||||
23 | 31, 2004, an amount equal to the amount of intangible | ||||||
24 | expenses and costs otherwise allowed as a deduction in | ||||||
25 | computing base income, and that were paid, accrued, or | ||||||
26 | incurred, directly or indirectly, to a foreign person |
| |||||||
| |||||||
1 | who would be a member of the same unitary business | ||||||
2 | group but for the fact that the foreign person's | ||||||
3 | business activity outside the United States is 80% or | ||||||
4 | more of that person's total business activity. 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 pursuant | ||||||
11 | to Sections 951 through 964 of the Internal Revenue | ||||||
12 | Code and amounts included in gross income under Section | ||||||
13 | 78 of the Internal Revenue Code) with respect to the | ||||||
14 | stock of the same person to whom the intangible | ||||||
15 | expenses and costs were directly or indirectly paid, | ||||||
16 | incurred or accrued. The preceding sentence shall not | ||||||
17 | apply to the extent that the same dividends caused a | ||||||
18 | reduction to the addition modification required under | ||||||
19 | Section 203(d)(2)(D-7) of this Act. As used in this | ||||||
20 | subparagraph, the term "intangible expenses and costs" | ||||||
21 | includes (1) expenses, losses, and costs for, or | ||||||
22 | related to, the direct or indirect acquisition, use, | ||||||
23 | maintenance or management, ownership, sale, exchange, | ||||||
24 | or any other disposition of intangible property; (2) | ||||||
25 | losses incurred, directly or indirectly, from | ||||||
26 | factoring transactions or discounting transactions; |
| |||||||
| |||||||
1 | (3) royalty, patent, technical, and copyright fees; | ||||||
2 | (4) licensing fees; and (5) other similar expenses and | ||||||
3 | costs. For purposes of this subparagraph, "intangible | ||||||
4 | property" includes patents, patent applications, trade | ||||||
5 | names, trademarks, service marks, copyrights, mask | ||||||
6 | works, trade secrets, and similar types of intangible | ||||||
7 | assets; | ||||||
8 | This paragraph shall not apply to the following: | ||||||
9 | (i) any item of intangible expenses or costs | ||||||
10 | paid, accrued, or incurred, directly or | ||||||
11 | indirectly, from a transaction with a foreign | ||||||
12 | person who is subject in a foreign country or | ||||||
13 | state, other than a state which requires mandatory | ||||||
14 | unitary reporting, to a tax on or measured by net | ||||||
15 | income with respect to such item; or | ||||||
16 | (ii) any item of intangible expense or cost | ||||||
17 | paid, accrued, or incurred, directly or | ||||||
18 | indirectly, if the taxpayer can establish, based | ||||||
19 | on a preponderance of the evidence, both of the | ||||||
20 | following: | ||||||
21 | (a) the foreign person during the same | ||||||
22 | taxable year paid, accrued, or incurred, the | ||||||
23 | intangible expense or cost to a person that is | ||||||
24 | not a related member, and | ||||||
25 | (b) the transaction giving rise to the | ||||||
26 | intangible expense or cost between the |
| |||||||
| |||||||
1 | taxpayer and the foreign person did not have as | ||||||
2 | a principal purpose the avoidance of Illinois | ||||||
3 | income tax, and is paid pursuant to a contract | ||||||
4 | or agreement that reflects arm's-length terms; | ||||||
5 | or | ||||||
6 | (iii) any item of intangible expense or cost | ||||||
7 | paid, accrued, or incurred, directly or | ||||||
8 | indirectly, from a transaction with a foreign | ||||||
9 | person if the taxpayer establishes by clear and | ||||||
10 | convincing evidence, that the adjustments are | ||||||
11 | unreasonable; or if the taxpayer and the Director | ||||||
12 | agree in writing to the application or use of an | ||||||
13 | alternative method of apportionment under Section | ||||||
14 | 304(f);
| ||||||
15 | Nothing in this subsection shall preclude the | ||||||
16 | Director from making any other adjustment | ||||||
17 | otherwise allowed under Section 404 of this Act for | ||||||
18 | any tax year beginning after the effective date of | ||||||
19 | this amendment provided such adjustment is made | ||||||
20 | pursuant to regulation adopted by the Department | ||||||
21 | and such regulations provide methods and standards | ||||||
22 | by which the Department will utilize its authority | ||||||
23 | under Section 404 of this Act;
| ||||||
24 | and by deducting from the total so obtained the following | ||||||
25 | amounts:
| ||||||
26 | (E) The valuation limitation amount;
|
| |||||||
| |||||||
1 | (F) An amount equal to the amount of any tax | ||||||
2 | imposed by this Act which
was refunded to the taxpayer | ||||||
3 | and included in such total for the taxable year;
| ||||||
4 | (G) An amount equal to all amounts included in | ||||||
5 | taxable income as
modified by subparagraphs (A), (B), | ||||||
6 | (C) and (D) which are exempt from
taxation by this | ||||||
7 | State either by reason of its statutes or Constitution | ||||||
8 | or
by reason of
the Constitution, treaties or statutes | ||||||
9 | of the United States;
provided that, in the case of any | ||||||
10 | statute of this State that exempts income
derived from | ||||||
11 | bonds or other obligations from the tax imposed under | ||||||
12 | this Act,
the amount exempted shall be the interest net | ||||||
13 | of bond premium amortization;
| ||||||
14 | (H) Any income of the partnership which | ||||||
15 | constitutes personal service
income as defined in | ||||||
16 | Section 1348 (b) (1) of the Internal Revenue Code (as
| ||||||
17 | in effect December 31, 1981) or a reasonable allowance | ||||||
18 | for compensation
paid or accrued for services rendered | ||||||
19 | by partners to the partnership,
whichever is greater;
| ||||||
20 | (I) An amount equal to all amounts of income | ||||||
21 | distributable to an entity
subject to the Personal | ||||||
22 | Property Tax Replacement Income Tax imposed by
| ||||||
23 | subsections (c) and (d) of Section 201 of this Act | ||||||
24 | including amounts
distributable to organizations | ||||||
25 | exempt from federal income tax by reason of
Section | ||||||
26 | 501(a) of the Internal Revenue Code;
|
| |||||||
| |||||||
1 | (J) With the exception of any amounts subtracted | ||||||
2 | under subparagraph
(G),
an amount equal to the sum of | ||||||
3 | all amounts disallowed as deductions
by (i) Sections | ||||||
4 | 171(a) (2), and 265(2) of the Internal Revenue Code of | ||||||
5 | 1954,
as now or hereafter amended, and all amounts of | ||||||
6 | expenses allocable to
interest and disallowed as | ||||||
7 | deductions by Section 265(1) of the Internal
Revenue | ||||||
8 | Code, as now or hereafter amended;
and (ii) for taxable | ||||||
9 | years
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; the provisions of this
| ||||||
12 | subparagraph are exempt from the provisions of Section | ||||||
13 | 250;
| ||||||
14 | (K) An amount equal to those dividends included in | ||||||
15 | such total which were
paid by a corporation which | ||||||
16 | conducts business operations in an Enterprise
Zone or | ||||||
17 | zones created under the Illinois Enterprise Zone Act, | ||||||
18 | enacted by
the 82nd General Assembly, or a River Edge | ||||||
19 | Redevelopment Zone or zones created under the River | ||||||
20 | Edge Redevelopment Zone Act and
conducts substantially | ||||||
21 | all of its operations
in an Enterprise Zone or Zones or | ||||||
22 | from a River Edge Redevelopment Zone or zones. This | ||||||
23 | subparagraph (K) is exempt from the provisions of | ||||||
24 | Section 250;
| ||||||
25 | (L) An amount equal to any contribution made to a | ||||||
26 | job training project
established pursuant to the Real |
| |||||||
| |||||||
1 | Property Tax Increment Allocation
Redevelopment Act;
| ||||||
2 | (M) An amount equal to those dividends included in | ||||||
3 | such total
that were paid by a corporation that | ||||||
4 | conducts business operations in a
federally designated | ||||||
5 | Foreign Trade Zone or Sub-Zone and that is designated a
| ||||||
6 | High Impact Business located in Illinois; provided | ||||||
7 | that dividends eligible
for the deduction provided in | ||||||
8 | subparagraph (K) of paragraph (2) of this
subsection | ||||||
9 | shall not be eligible for the deduction provided under | ||||||
10 | this
subparagraph (M);
| ||||||
11 | (N) An amount equal to the amount of the deduction | ||||||
12 | used to compute the
federal income tax credit for | ||||||
13 | restoration of substantial amounts held under
claim of | ||||||
14 | right for the taxable year pursuant to Section 1341 of | ||||||
15 | the
Internal Revenue Code of 1986;
| ||||||
16 | (O) For taxable years 2001 and thereafter, for the | ||||||
17 | taxable year in
which the bonus depreciation deduction
| ||||||
18 | is taken on the taxpayer's federal income tax return | ||||||
19 | under
subsection (k) of Section 168 of the Internal | ||||||
20 | Revenue Code and for each
applicable taxable year | ||||||
21 | thereafter, an amount equal to "x", where:
| ||||||
22 | (1) "y" equals the amount of the depreciation | ||||||
23 | deduction taken for the
taxable year
on the | ||||||
24 | taxpayer's federal income tax return on property | ||||||
25 | for which the bonus
depreciation deduction
was | ||||||
26 | taken in any year under subsection (k) of Section |
| |||||||
| |||||||
1 | 168 of the Internal
Revenue Code, but not including | ||||||
2 | the bonus depreciation deduction;
| ||||||
3 | (2) for taxable years ending on or before | ||||||
4 | December 31, 2005, "x" equals "y" multiplied by 30 | ||||||
5 | and then divided by 70 (or "y"
multiplied by | ||||||
6 | 0.429); and | ||||||
7 | (3) for taxable years ending after December | ||||||
8 | 31, 2005: | ||||||
9 | (i) for property on which a bonus | ||||||
10 | depreciation deduction of 30% of the adjusted | ||||||
11 | basis was taken, "x" equals "y" multiplied by | ||||||
12 | 30 and then divided by 70 (or "y"
multiplied by | ||||||
13 | 0.429); and | ||||||
14 | (ii) for property on which a bonus | ||||||
15 | depreciation deduction of 50% of the adjusted | ||||||
16 | basis was taken, "x" equals "y" multiplied by | ||||||
17 | 1.0.
| ||||||
18 | The aggregate amount deducted under this | ||||||
19 | subparagraph in all taxable
years for any one piece of | ||||||
20 | property may not exceed the amount of the bonus
| ||||||
21 | depreciation deduction
taken on that property on the | ||||||
22 | taxpayer's federal income tax return under
subsection | ||||||
23 | (k) of Section 168 of the Internal Revenue Code. This | ||||||
24 | subparagraph (O) is exempt from the provisions of | ||||||
25 | Section 250;
| ||||||
26 | (P) If the taxpayer sells, transfers, abandons, or |
| |||||||
| |||||||
1 | otherwise disposes of
property for which the taxpayer | ||||||
2 | was required in any taxable year to make an
addition | ||||||
3 | modification under subparagraph (D-5), then an amount | ||||||
4 | equal to that
addition modification.
| ||||||
5 | If the taxpayer continues to own property through | ||||||
6 | the last day of the last tax year for which the | ||||||
7 | taxpayer may claim a depreciation deduction for | ||||||
8 | federal income tax purposes and for which the taxpayer | ||||||
9 | was required in any taxable year to make an addition | ||||||
10 | modification under subparagraph (D-5), then an amount | ||||||
11 | equal to that addition modification.
| ||||||
12 | The taxpayer is allowed to take the deduction under | ||||||
13 | this subparagraph
only once with respect to any one | ||||||
14 | piece of property. | ||||||
15 | This subparagraph (P) is exempt from the | ||||||
16 | provisions of Section 250;
| ||||||
17 | (Q) The amount of (i) any interest income (net of | ||||||
18 | the deductions allocable thereto) taken into account | ||||||
19 | for the taxable year with respect to a transaction with | ||||||
20 | a taxpayer that is required to make an addition | ||||||
21 | modification with respect to such transaction under | ||||||
22 | Section 203(a)(2)(D-17), 203(b)(2)(E-12), | ||||||
23 | 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed | ||||||
24 | the amount of such addition modification and
(ii) any | ||||||
25 | income from intangible property (net of the deductions | ||||||
26 | allocable thereto) taken into account for the taxable |
| |||||||
| |||||||
1 | year with respect to a transaction with a taxpayer that | ||||||
2 | is required to make an addition modification with | ||||||
3 | respect to such transaction under Section | ||||||
4 | 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or | ||||||
5 | 203(d)(2)(D-8), but not to exceed the amount of such | ||||||
6 | addition modification;
| ||||||
7 | (R) An amount equal to the interest income taken | ||||||
8 | into account for the taxable year (net of the | ||||||
9 | deductions allocable thereto) with respect to | ||||||
10 | transactions with a foreign person who would be a | ||||||
11 | member of the taxpayer's unitary business group but for | ||||||
12 | the fact that the foreign person's business activity | ||||||
13 | outside the United States is 80% or more of that | ||||||
14 | person's total business activity, but not to exceed the | ||||||
15 | addition modification required to be made for the same | ||||||
16 | taxable year under Section 203(d)(2)(D-7) for interest | ||||||
17 | paid, accrued, or incurred, directly or indirectly, to | ||||||
18 | the same foreign person; and
| ||||||
19 | (S) An amount equal to the income from intangible | ||||||
20 | property taken into account for the taxable year (net | ||||||
21 | of the deductions allocable thereto) with respect to | ||||||
22 | transactions with a foreign person who would be a | ||||||
23 | member of the taxpayer's unitary business group but for | ||||||
24 | the fact that the foreign person's business activity | ||||||
25 | outside the United States is 80% or more of that | ||||||
26 | person's total business activity, but not to exceed the |
| |||||||
| |||||||
1 | addition modification required to be made for the same | ||||||
2 | taxable year under Section 203(d)(2)(D-8) for | ||||||
3 | intangible expenses and costs paid, accrued, or | ||||||
4 | incurred, directly or indirectly, to the same foreign | ||||||
5 | person.
| ||||||
6 | (e) Gross income; adjusted gross income; taxable income.
| ||||||
7 | (1) In general. Subject to the provisions of paragraph | ||||||
8 | (2) and
subsection (b) (3), for purposes of this Section | ||||||
9 | and Section 803(e), a
taxpayer's gross income, adjusted | ||||||
10 | gross income, or taxable income for
the taxable year shall | ||||||
11 | mean the amount of gross income, adjusted gross
income or | ||||||
12 | taxable income properly reportable for federal income tax
| ||||||
13 | purposes for the taxable year under the provisions of the | ||||||
14 | Internal
Revenue Code. Taxable income may be less than | ||||||
15 | zero. However, for taxable
years ending on or after | ||||||
16 | December 31, 1986, net operating loss
carryforwards from | ||||||
17 | taxable years ending prior to December 31, 1986, may not
| ||||||
18 | exceed the sum of federal taxable income for the taxable | ||||||
19 | year before net
operating loss deduction, plus the excess | ||||||
20 | of addition modifications over
subtraction modifications | ||||||
21 | for the taxable year. For taxable years ending
prior to | ||||||
22 | December 31, 1986, taxable income may never be an amount in | ||||||
23 | excess
of the net operating loss for the taxable year as | ||||||
24 | defined in subsections
(c) and (d) of Section 172 of the | ||||||
25 | Internal Revenue Code, provided that when
taxable income of |
| |||||||
| |||||||
1 | a corporation (other than a Subchapter S corporation),
| ||||||
2 | trust, or estate is less than zero and addition | ||||||
3 | modifications, other than
those provided by subparagraph | ||||||
4 | (E) of paragraph (2) of subsection (b) for
corporations or | ||||||
5 | subparagraph (E) of paragraph (2) of subsection (c) for
| ||||||
6 | trusts and estates, exceed subtraction modifications, an | ||||||
7 | addition
modification must be made under those | ||||||
8 | subparagraphs for any other taxable
year to which the | ||||||
9 | taxable income less than zero (net operating loss) is
| ||||||
10 | applied under Section 172 of the Internal Revenue Code or | ||||||
11 | under
subparagraph (E) of paragraph (2) of this subsection | ||||||
12 | (e) applied in
conjunction with Section 172 of the Internal | ||||||
13 | Revenue Code.
| ||||||
14 | (2) Special rule. For purposes of paragraph (1) of this | ||||||
15 | subsection,
the taxable income properly reportable for | ||||||
16 | federal income tax purposes
shall mean:
| ||||||
17 | (A) Certain life insurance companies. In the case | ||||||
18 | of a life
insurance company subject to the tax imposed | ||||||
19 | by Section 801 of the
Internal Revenue Code, life | ||||||
20 | insurance company taxable income, plus the
amount of | ||||||
21 | distribution from pre-1984 policyholder surplus | ||||||
22 | accounts as
calculated under Section 815a of the | ||||||
23 | Internal Revenue Code;
| ||||||
24 | (B) Certain other insurance companies. In the case | ||||||
25 | of mutual
insurance companies subject to the tax | ||||||
26 | imposed by Section 831 of the
Internal Revenue Code, |
| |||||||
| |||||||
1 | insurance company taxable income;
| ||||||
2 | (C) Regulated investment companies. In the case of | ||||||
3 | a regulated
investment company subject to the tax | ||||||
4 | imposed by Section 852 of the
Internal Revenue Code, | ||||||
5 | investment company taxable income;
| ||||||
6 | (D) Real estate investment trusts. In the case of a | ||||||
7 | real estate
investment trust subject to the tax imposed | ||||||
8 | by Section 857 of the
Internal Revenue Code, real | ||||||
9 | estate investment trust taxable income;
| ||||||
10 | (E) Consolidated corporations. In the case of a | ||||||
11 | corporation which
is a member of an affiliated group of | ||||||
12 | corporations filing a consolidated
income tax return | ||||||
13 | for the taxable year for federal income tax purposes,
| ||||||
14 | taxable income determined as if such corporation had | ||||||
15 | filed a separate
return for federal income tax purposes | ||||||
16 | for the taxable year and each
preceding taxable year | ||||||
17 | for which it was a member of an affiliated group.
For | ||||||
18 | purposes of this subparagraph, the taxpayer's separate | ||||||
19 | taxable
income shall be determined as if the election | ||||||
20 | provided by Section
243(b) (2) of the Internal Revenue | ||||||
21 | Code had been in effect for all such years;
| ||||||
22 | (F) Cooperatives. In the case of a cooperative | ||||||
23 | corporation or
association, the taxable income of such | ||||||
24 | organization determined in
accordance with the | ||||||
25 | provisions of Section 1381 through 1388 of the
Internal | ||||||
26 | Revenue Code;
|
| |||||||
| |||||||
1 | (G) Subchapter S corporations. In the case of: (i) | ||||||
2 | a Subchapter S
corporation for which there is in effect | ||||||
3 | an election for the taxable year
under Section 1362 of | ||||||
4 | the Internal Revenue Code, the taxable income of such
| ||||||
5 | corporation determined in accordance with Section | ||||||
6 | 1363(b) of the Internal
Revenue Code, except that | ||||||
7 | taxable income shall take into
account those items | ||||||
8 | which are required by Section 1363(b)(1) of the
| ||||||
9 | Internal Revenue Code to be separately stated; and (ii) | ||||||
10 | a Subchapter
S corporation for which there is in effect | ||||||
11 | a federal election to opt out of
the provisions of the | ||||||
12 | Subchapter S Revision Act of 1982 and have applied
| ||||||
13 | instead the prior federal Subchapter S rules as in | ||||||
14 | effect on July 1, 1982,
the taxable income of such | ||||||
15 | corporation determined in accordance with the
federal | ||||||
16 | Subchapter S rules as in effect on July 1, 1982; and
| ||||||
17 | (H) Partnerships. In the case of a partnership, | ||||||
18 | taxable income
determined in accordance with Section | ||||||
19 | 703 of the Internal Revenue Code,
except that taxable | ||||||
20 | income shall take into account those items which are
| ||||||
21 | required by Section 703(a)(1) to be separately stated | ||||||
22 | but which would be
taken into account by an individual | ||||||
23 | in calculating his taxable income.
| ||||||
24 | (3) Recapture of business expenses on disposition of | ||||||
25 | asset or business. Notwithstanding any other law to the | ||||||
26 | contrary, if in prior years income from an asset or |
| |||||||
| |||||||
1 | business has been classified as business income and in a | ||||||
2 | later year is demonstrated to be non-business income, then | ||||||
3 | all expenses, without limitation, deducted in such later | ||||||
4 | year and in the 2 immediately preceding taxable years | ||||||
5 | related to that asset or business that generated the | ||||||
6 | non-business income shall be added back and recaptured as | ||||||
7 | business income in the year of the disposition of the asset | ||||||
8 | or business. Such amount shall be apportioned to Illinois | ||||||
9 | using the greater of the apportionment fraction computed | ||||||
10 | for the business under Section 304 of this Act for the | ||||||
11 | taxable year or the average of the apportionment fractions | ||||||
12 | computed for the business under Section 304 of this Act for | ||||||
13 | the taxable year and for the 2 immediately preceding | ||||||
14 | taxable years.
| ||||||
15 | (f) Valuation limitation amount.
| ||||||
16 | (1) In general. The valuation limitation amount | ||||||
17 | referred to in
subsections (a) (2) (G), (c) (2) (I) and | ||||||
18 | (d)(2) (E) is an amount equal to:
| ||||||
19 | (A) The sum of the pre-August 1, 1969 appreciation | ||||||
20 | amounts (to the
extent consisting of gain reportable | ||||||
21 | under the provisions of Section
1245 or 1250 of the | ||||||
22 | Internal Revenue Code) for all property in respect
of | ||||||
23 | which such gain was reported for the taxable year; plus
| ||||||
24 | (B) The lesser of (i) the sum of the pre-August 1, | ||||||
25 | 1969 appreciation
amounts (to the extent consisting of | ||||||
26 | capital gain) for all property in
respect of which such |
| |||||||
| |||||||
1 | gain was reported for federal income tax purposes
for | ||||||
2 | the taxable year, or (ii) the net capital gain for the | ||||||
3 | taxable year,
reduced in either case by any amount of | ||||||
4 | such gain included in the amount
determined under | ||||||
5 | subsection (a) (2) (F) or (c) (2) (H).
| ||||||
6 | (2) Pre-August 1, 1969 appreciation amount.
| ||||||
7 | (A) If the fair market value of property referred | ||||||
8 | to in paragraph
(1) was readily ascertainable on August | ||||||
9 | 1, 1969, the pre-August 1, 1969
appreciation amount for | ||||||
10 | such property is the lesser of (i) the excess of
such | ||||||
11 | fair market value over the taxpayer's basis (for | ||||||
12 | determining gain)
for such property on that date | ||||||
13 | (determined under the Internal Revenue
Code as in | ||||||
14 | effect on that date), or (ii) the total gain realized | ||||||
15 | and
reportable for federal income tax purposes in | ||||||
16 | respect of the sale,
exchange or other disposition of | ||||||
17 | such property.
| ||||||
18 | (B) If the fair market value of property referred | ||||||
19 | to in paragraph
(1) was not readily ascertainable on | ||||||
20 | August 1, 1969, the pre-August 1,
1969 appreciation | ||||||
21 | amount for such property is that amount which bears
the | ||||||
22 | same ratio to the total gain reported in respect of the | ||||||
23 | property for
federal income tax purposes for the | ||||||
24 | taxable year, as the number of full
calendar months in | ||||||
25 | that part of the taxpayer's holding period for the
| ||||||
26 | property ending July 31, 1969 bears to the number of |
| |||||||
| |||||||
1 | full calendar
months in the taxpayer's entire holding | ||||||
2 | period for the
property.
| ||||||
3 | (C) The Department shall prescribe such | ||||||
4 | regulations as may be
necessary to carry out the | ||||||
5 | purposes of this paragraph.
| ||||||
6 | (g) Double deductions. Unless specifically provided | ||||||
7 | otherwise, nothing
in this Section shall permit the same item | ||||||
8 | to be deducted more than once.
| ||||||
9 | (h) Legislative intention. Except as expressly provided by | ||||||
10 | this
Section there shall be no modifications or limitations on | ||||||
11 | the amounts
of income, gain, loss or deduction taken into | ||||||
12 | account in determining
gross income, adjusted gross income or | ||||||
13 | taxable income for federal income
tax purposes for the taxable | ||||||
14 | year, or in the amount of such items
entering into the | ||||||
15 | computation of base income and net income under this
Act for | ||||||
16 | such taxable year, whether in respect of property values as of
| ||||||
17 | August 1, 1969 or otherwise.
| ||||||
18 | (Source: P.A. 93-812, eff. 7-26-04; 93-840, eff. 7-30-04; | ||||||
19 | 94-776, eff. 5-19-06; 94-789, eff. 5-19-06; 94-1021, eff. | ||||||
20 | 7-12-06; 94-1074, eff. 12-26-06; revised 1-2-07.)
| ||||||
21 | (35 ILCS 5/247 new) | ||||||
22 | Sec. 247. Family Tax Credit. | ||||||
23 | (a) For taxable years beginning after January 1, 2007, each |
| ||||||||||||||||||||||
| ||||||||||||||||||||||
1 | taxpayer who is a
natural person or is a married couple filing | |||||||||||||||||||||
2 | jointly that reports total annual income of $47,000 or less | |||||||||||||||||||||
3 | (the "eligibility cap"), is entitled to a refundable tax credit | |||||||||||||||||||||
4 | known as the Family Tax Credit in those amounts identified in | |||||||||||||||||||||
5 | subsection (b) of this Section. The Family Tax Credit may be | |||||||||||||||||||||
6 | claimed only upon proper filing of an Illinois State income tax | |||||||||||||||||||||
7 | return by an eligible taxpayer. The eligibility cap shall | |||||||||||||||||||||
8 | increase for each tax year beginning after December 31, 2007, | |||||||||||||||||||||
9 | by an amount equal to the percentage increase, if any, in the | |||||||||||||||||||||
10 | Consumer Price Index ("CPI") published by the U.S. Bureau of | |||||||||||||||||||||
11 | Labor Statistics for the immediately preceding tax year, | |||||||||||||||||||||
12 | multiplied by the eligibility cap for that immediately | |||||||||||||||||||||
13 | preceding tax year. | |||||||||||||||||||||
14 | (b) The amount of Family Tax Credit an eligible taxpayer | |||||||||||||||||||||
15 | may claim will vary in
amount, based on the following table: | |||||||||||||||||||||
| ||||||||||||||||||||||
21 | The dollar ranges of Total Annual Income identified in each | |||||||||||||||||||||
22 | category, as well as the value of the credit for that category, | |||||||||||||||||||||
23 | shall increase in each tax year beginning after December 31, | |||||||||||||||||||||
24 | 2007 by an amount equal to the applicable Total Annual Income |
| |||||||
| |||||||
1 | category or credit amount, as the case may be, increased by the | ||||||
2 | percentage increase, if any, in the CPI for the immediately | ||||||
3 | preceding tax year. The Department of Revenue shall update the | ||||||
4 | Total Annual Income category and credit amounts for the Family | ||||||
5 | Tax Credit annually and distribute the updated table with the | ||||||
6 | Illinois personal income tax returns. | ||||||
7 | (c) If the amount of the Family Tax Credit exceeds the | ||||||
8 | income tax liability of an eligible taxpayer, the State shall | ||||||
9 | refund to the taxpayer the difference between the Family Tax | ||||||
10 | Credit and the taxpayer's income tax liability. | ||||||
11 | (d) This Section is exempt from the provisions of Section | ||||||
12 | 250 of this Act. | ||||||
13 | Section 15. The Use Tax Act is amended by changing Section | ||||||
14 | 2 as follows:
| ||||||
15 | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
| ||||||
16 | Sec. 2. "Use" means the exercise by any person of any right | ||||||
17 | or power over
tangible personal property incident to the | ||||||
18 | ownership of that property,
except that it does not include the | ||||||
19 | sale of such property in any form as
tangible personal property | ||||||
20 | in the regular course of business to the extent
that such | ||||||
21 | property is not first subjected to a use for which it was
| ||||||
22 | purchased, and does not include the use of such property by its | ||||||
23 | owner for
demonstration purposes: Provided that the property | ||||||
24 | purchased is deemed to
be purchased for the purpose of resale, |
| |||||||
| |||||||
1 | despite first being used, to the
extent to which it is resold | ||||||
2 | as an ingredient of an intentionally produced
product or | ||||||
3 | by-product of manufacturing. "Use" does not mean the | ||||||
4 | demonstration
use or interim use of tangible personal property | ||||||
5 | by a retailer before he sells
that tangible personal property. | ||||||
6 | For watercraft or aircraft, if the period of
demonstration use | ||||||
7 | or interim use by the retailer exceeds 18 months,
the retailer
| ||||||
8 | shall pay on the retailers' original cost price the tax imposed | ||||||
9 | by this Act,
and no credit for that tax is permitted if the | ||||||
10 | watercraft or aircraft is
subsequently sold by the retailer. | ||||||
11 | "Use" does not mean the physical
incorporation of tangible | ||||||
12 | personal property, to the extent not first subjected
to a use | ||||||
13 | for which it was purchased, as an ingredient or constituent, | ||||||
14 | into
other tangible personal property (a) which is sold in the | ||||||
15 | regular course of
business or (b) which the person | ||||||
16 | incorporating such ingredient or constituent
therein has | ||||||
17 | undertaken at the time of such purchase to cause to be | ||||||
18 | transported
in interstate commerce to destinations outside the | ||||||
19 | State of Illinois: Provided
that the property purchased is | ||||||
20 | deemed to be purchased for the purpose of
resale, despite first | ||||||
21 | being used, to the extent to which it is resold as an
| ||||||
22 | ingredient of an intentionally produced product or by-product | ||||||
23 | of manufacturing.
| ||||||
24 | "Watercraft" means a Class 2, Class 3, or Class 4 | ||||||
25 | watercraft as defined in
Section 3-2 of the Boat Registration | ||||||
26 | and Safety Act, a personal watercraft, or
any boat equipped |
| |||||||
| |||||||
1 | with an inboard motor.
| ||||||
2 | "Purchase at retail" means the acquisition of the ownership | ||||||
3 | of or title
to tangible personal property through a sale at | ||||||
4 | retail.
| ||||||
5 | "Purchaser" means anyone who, through a sale at retail, | ||||||
6 | acquires the
ownership of tangible personal property for a | ||||||
7 | valuable consideration.
| ||||||
8 | "Sale at retail" means any transfer of the ownership of or | ||||||
9 | title to
tangible personal property to a purchaser, for the | ||||||
10 | purpose of use, and not
for the purpose of resale in any form | ||||||
11 | as tangible personal property to the
extent not first subjected | ||||||
12 | to a use for which it was purchased, for a
valuable | ||||||
13 | consideration: Provided that the property purchased is deemed | ||||||
14 | to
be purchased for the purpose of resale, despite first being | ||||||
15 | used, to the
extent to which it is resold as an ingredient of | ||||||
16 | an intentionally produced
product or by-product of | ||||||
17 | manufacturing. For this purpose, slag produced as
an incident | ||||||
18 | to manufacturing pig iron or steel and sold is considered to be
| ||||||
19 | an intentionally produced by-product of manufacturing. "Sale | ||||||
20 | at retail"
includes any such transfer made for resale unless | ||||||
21 | made in compliance with
Section 2c of the Retailers' Occupation | ||||||
22 | Tax Act, as incorporated by
reference into Section 12 of this | ||||||
23 | Act. Transactions whereby the possession
of the property is | ||||||
24 | transferred but the seller retains the title as security
for | ||||||
25 | payment of the selling price are sales.
| ||||||
26 | "Sale at retail" shall also be construed to include any |
| |||||||
| |||||||
1 | Illinois
florist's sales transaction in which the purchase | ||||||
2 | order is received in
Illinois by a florist and the sale is for | ||||||
3 | use or consumption, but the
Illinois florist has a florist in | ||||||
4 | another state deliver the property to the
purchaser or the | ||||||
5 | purchaser's donee in such other state.
| ||||||
6 | Nonreusable tangible personal property that is used by | ||||||
7 | persons engaged in
the business of operating a restaurant, | ||||||
8 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
9 | transferred to customers in the ordinary course of business
as | ||||||
10 | part of the sale of food or beverages and is used to deliver, | ||||||
11 | package, or
consume food or beverages, regardless of where | ||||||
12 | consumption of the food or
beverages occurs. Examples of those | ||||||
13 | items include, but are not limited to
nonreusable, paper and | ||||||
14 | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | ||||||
15 | containers, utensils, straws, placemats, napkins, doggie bags, | ||||||
16 | and
wrapping or packaging
materials that are transferred to | ||||||
17 | customers as part of the sale of food or
beverages in the | ||||||
18 | ordinary course of business.
| ||||||
19 | The purchase, employment and transfer of such tangible | ||||||
20 | personal property
as newsprint and ink for the primary purpose | ||||||
21 | of conveying news (with or
without other information) is not a | ||||||
22 | purchase, use or sale of tangible
personal property.
| ||||||
23 | "Selling price" means the consideration for a sale valued | ||||||
24 | in money
whether received in money or otherwise, including | ||||||
25 | cash, credits, property
other than as hereinafter provided, and | ||||||
26 | services, but not including the
value of or credit given for |
| |||||||
| |||||||
1 | traded-in tangible personal property where the
item that is | ||||||
2 | traded-in is of like kind and character as that which is being
| ||||||
3 | sold, and shall be determined without any deduction on account | ||||||
4 | of the cost
of the property sold, the cost of materials used, | ||||||
5 | labor or service cost or
any other expense whatsoever, but does | ||||||
6 | not include interest or finance
charges which appear as | ||||||
7 | separate items on the bill of sale or sales
contract nor | ||||||
8 | charges that are added to prices by sellers on account of the
| ||||||
9 | seller's tax liability under the "Retailers' Occupation Tax | ||||||
10 | Act", or on
account of the seller's duty to collect, from the | ||||||
11 | purchaser, the tax that
is imposed by this Act, or on account | ||||||
12 | of the seller's tax liability under
Section 8-11-1 of the | ||||||
13 | Illinois Municipal Code, as heretofore and hereafter
amended, | ||||||
14 | or on account of the seller's tax liability under the "County
| ||||||
15 | Retailers' Occupation Tax Act". Effective December 1, 1985, | ||||||
16 | "selling price"
shall include charges that are added to prices | ||||||
17 | by sellers on account of the
seller's tax liability under the | ||||||
18 | Cigarette Tax Act, on account of the seller's
duty to collect, | ||||||
19 | from the purchaser, the tax imposed under the Cigarette Use
Tax | ||||||
20 | Act, and on account of the seller's duty to collect, from the | ||||||
21 | purchaser,
any cigarette tax imposed by a home rule unit.
| ||||||
22 | The phrase "like kind and character" shall be liberally | ||||||
23 | construed
(including but not limited to any form of motor | ||||||
24 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
25 | agricultural implement for any other
kind of farm or | ||||||
26 | agricultural implement), while not including a kind of item
|
| |||||||
| |||||||
1 | which, if sold at retail by that retailer, would be exempt from | ||||||
2 | retailers'
occupation tax and use tax as an isolated or | ||||||
3 | occasional sale.
| ||||||
4 | "Department" means the Department of Revenue.
| ||||||
5 | "Person" means any natural individual, firm, partnership, | ||||||
6 | association,
joint stock company, joint adventure, public or | ||||||
7 | private corporation, limited
liability company, or a
receiver, | ||||||
8 | executor, trustee, guardian or other representative appointed
| ||||||
9 | by order of any court.
| ||||||
10 | "Retailer" means and includes every person engaged in the | ||||||
11 | business of
making sales at retail as defined in this Section.
| ||||||
12 | A person who holds himself or herself out as being engaged | ||||||
13 | (or who habitually
engages) in selling tangible personal | ||||||
14 | property at retail is a retailer
hereunder with respect to such | ||||||
15 | sales (and not primarily in a service
occupation) | ||||||
16 | notwithstanding the fact that such person designs and produces
| ||||||
17 | such tangible personal property on special order for the | ||||||
18 | purchaser and in
such a way as to render the property of value | ||||||
19 | only to such purchaser, if
such tangible personal property so | ||||||
20 | produced on special order serves
substantially the same | ||||||
21 | function as stock or standard items of tangible
personal | ||||||
22 | property that are sold at retail.
| ||||||
23 | A person whose activities are organized and conducted | ||||||
24 | primarily as a
not-for-profit service enterprise, and who | ||||||
25 | engages in selling tangible
personal property at retail | ||||||
26 | (whether to the public or merely to members and
their guests) |
| |||||||
| |||||||
1 | is a retailer with respect to such transactions, excepting
only | ||||||
2 | a person organized and operated exclusively for charitable, | ||||||
3 | religious
or educational purposes either (1), to the extent of | ||||||
4 | sales by such person
to its members, students, patients or | ||||||
5 | inmates of tangible personal property
to be used primarily for | ||||||
6 | the purposes of such person, or (2), to the extent
of sales by | ||||||
7 | such person of tangible personal property which is not sold or
| ||||||
8 | offered for sale by persons organized for profit. The selling | ||||||
9 | of school
books and school supplies by schools at retail to | ||||||
10 | students is not
"primarily for the purposes of" the school | ||||||
11 | which does such selling. This
paragraph does not apply to nor | ||||||
12 | subject to taxation occasional dinners,
social or similar | ||||||
13 | activities of a person organized and operated exclusively
for | ||||||
14 | charitable, religious or educational purposes, whether or not | ||||||
15 | such
activities are open to the public.
| ||||||
16 | A person who is the recipient of a grant or contract under | ||||||
17 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | ||||||
18 | serves meals to
participants in the federal Nutrition Program | ||||||
19 | for the Elderly in return for
contributions established in | ||||||
20 | amount by the individual participant pursuant
to a schedule of | ||||||
21 | suggested fees as provided for in the federal Act is not a
| ||||||
22 | retailer under this Act with respect to such transactions.
| ||||||
23 | Persons who engage in the business of transferring tangible | ||||||
24 | personal
property upon the redemption of trading stamps are | ||||||
25 | retailers hereunder when
engaged in such business.
| ||||||
26 | The isolated or occasional sale of tangible personal |
| |||||||
| |||||||
1 | property at retail
by a person who does not hold himself out as | ||||||
2 | being engaged (or who does not
habitually engage) in selling | ||||||
3 | such tangible personal property at retail or
a sale through a | ||||||
4 | bulk vending machine does not make such person a retailer
| ||||||
5 | hereunder. However, any person who is engaged in a business | ||||||
6 | which is not
subject to the tax imposed by the "Retailers' | ||||||
7 | Occupation Tax Act" because
of involving the sale of or a | ||||||
8 | contract to sell real estate or a
construction contract to | ||||||
9 | improve real estate, but who, in the course of
conducting such | ||||||
10 | business, transfers tangible personal property to users or
| ||||||
11 | consumers in the finished form in which it was purchased, and | ||||||
12 | which does
not become real estate, under any provision of a | ||||||
13 | construction contract or
real estate sale or real estate sales | ||||||
14 | agreement entered into with some
other person arising out of or | ||||||
15 | because of such nontaxable business, is a
retailer to the | ||||||
16 | extent of the value of the tangible personal property so
| ||||||
17 | transferred. If, in such transaction, a separate charge is made | ||||||
18 | for the
tangible personal property so transferred, the value of | ||||||
19 | such property, for
the purposes of this Act, is the amount so | ||||||
20 | separately charged, but not less
than the cost of such property | ||||||
21 | to the transferor; if no separate charge is
made, the value of | ||||||
22 | such property, for the purposes of this Act, is the cost
to the | ||||||
23 | transferor of such tangible personal property.
| ||||||
24 | "Retailer maintaining a place of business in this State", | ||||||
25 | or any like
term, means and includes any of the following | ||||||
26 | retailers:
|
| |||||||
| |||||||
1 | 1. A retailer having or maintaining within this State, | ||||||
2 | directly or by
a subsidiary, an office, distribution house, | ||||||
3 | sales house, warehouse or other
place of business, or any | ||||||
4 | agent or other representative operating within this
State | ||||||
5 | under the authority of the retailer or its subsidiary, | ||||||
6 | irrespective of
whether such place of business or agent or | ||||||
7 | other representative is located here
permanently or | ||||||
8 | temporarily, or whether such retailer or subsidiary is | ||||||
9 | licensed
to do business in this State. However, the | ||||||
10 | ownership of property that is
located at the premises of a | ||||||
11 | printer with which the retailer has contracted for
printing | ||||||
12 | and that consists of the final printed product, property | ||||||
13 | that becomes
a part of the final printed product, or copy | ||||||
14 | from which the printed product is
produced shall not result | ||||||
15 | in the retailer being deemed to have or maintain an
office, | ||||||
16 | distribution house, sales house, warehouse, or other place | ||||||
17 | of business
within this State.
| ||||||
18 | 2. A retailer soliciting orders for tangible personal | ||||||
19 | property by
means of a telecommunication or television | ||||||
20 | shopping system (which utilizes toll
free numbers) which is | ||||||
21 | intended by the retailer to be broadcast by cable
| ||||||
22 | television or other means of broadcasting, to consumers | ||||||
23 | located in this State.
| ||||||
24 | 3. A retailer, pursuant to a contract with a | ||||||
25 | broadcaster or publisher
located in this State, soliciting | ||||||
26 | orders for tangible personal property by
means of |
| |||||||
| |||||||
1 | advertising which is disseminated primarily to consumers | ||||||
2 | located in
this State and only secondarily to bordering | ||||||
3 | jurisdictions.
| ||||||
4 | 4. A retailer soliciting orders for tangible personal | ||||||
5 | property by mail
if the solicitations are substantial and | ||||||
6 | recurring and if the retailer benefits
from any banking, | ||||||
7 | financing, debt collection, telecommunication, or | ||||||
8 | marketing
activities occurring in this State or benefits | ||||||
9 | from the location in this State
of authorized installation, | ||||||
10 | servicing, or repair facilities.
| ||||||
11 | 5. A retailer that is owned or controlled by the same | ||||||
12 | interests that own
or control any retailer engaging in | ||||||
13 | business in the same or similar line of
business in this | ||||||
14 | State.
| ||||||
15 | 6. A retailer having a franchisee or licensee operating | ||||||
16 | under its trade
name if the franchisee or licensee is | ||||||
17 | required to collect the tax under this
Section.
| ||||||
18 | 7. A retailer, pursuant to a contract with a cable | ||||||
19 | television operator
located in this State, soliciting | ||||||
20 | orders for tangible personal property by
means of | ||||||
21 | advertising which is transmitted or distributed over a | ||||||
22 | cable
television system in this State.
| ||||||
23 | 8. A retailer engaging in activities in Illinois, which | ||||||
24 | activities in
the state in which the retail business | ||||||
25 | engaging in such activities is located
would constitute | ||||||
26 | maintaining a place of business in that state.
|
| |||||||
| |||||||
1 | "Bulk vending machine" means a vending machine,
containing | ||||||
2 | unsorted confections, nuts, toys, or other items designed
| ||||||
3 | primarily to be used or played with by children
which, when a | ||||||
4 | coin or coins of a denomination not larger than $0.50 are | ||||||
5 | inserted, are dispensed in equal portions, at random and
| ||||||
6 | without selection by the customer.
| ||||||
7 | (Source: P.A. 94-1074, eff. 12-26-06.)
| ||||||
8 | (35 ILCS 105/3-50 rep.) (from Ch. 120, par. 439.3-50)
| ||||||
9 | Section 17. The Use Tax Act is amended by repealing Section | ||||||
10 | 3-50. | ||||||
11 | Section 20. The Service Use Tax Act is amended by changing | ||||||
12 | Section 2 as follows:
| ||||||
13 | (35 ILCS 110/2) (from Ch. 120, par. 439.32)
| ||||||
14 | Sec. 2. "Use" means the exercise by any person of any right | ||||||
15 | or power
over tangible personal property incident to the | ||||||
16 | ownership of that
property, but does not include the sale or | ||||||
17 | use for demonstration by him
of that property in any form as | ||||||
18 | tangible personal property in the
regular course of business.
| ||||||
19 | "Use" does not mean the interim
use of
tangible personal | ||||||
20 | property nor the physical incorporation of tangible
personal | ||||||
21 | property, as an ingredient or constituent, into other tangible
| ||||||
22 | personal property, (a) which is sold in the regular course of | ||||||
23 | business
or (b) which the person incorporating such ingredient |
| |||||||
| |||||||
1 | or constituent
therein has undertaken at the time of such | ||||||
2 | purchase to cause to be
transported in interstate commerce to | ||||||
3 | destinations outside the State of
Illinois.
| ||||||
4 | "Purchased from a serviceman" means the acquisition of the | ||||||
5 | ownership
of, or title to, tangible personal property through a | ||||||
6 | sale of service.
| ||||||
7 | "Purchaser" means any person who, through a sale of | ||||||
8 | service, acquires
the ownership of, or title to, any tangible | ||||||
9 | personal property.
| ||||||
10 | "Cost price" means the consideration paid by the serviceman | ||||||
11 | for a
purchase valued in money, whether paid in money or | ||||||
12 | otherwise, including
cash, credits and services, and shall be | ||||||
13 | determined without any
deduction on account of the supplier's | ||||||
14 | cost of the property sold or on
account of any other expense | ||||||
15 | incurred by the supplier. When a serviceman
contracts out part | ||||||
16 | or all of the services required in his sale of service,
it | ||||||
17 | shall be presumed that the cost price to the serviceman of the | ||||||
18 | property
transferred to him or her by his or her subcontractor | ||||||
19 | is equal to 50% of
the subcontractor's charges to the | ||||||
20 | serviceman in the absence of proof of
the consideration paid by | ||||||
21 | the subcontractor for the purchase of such property.
| ||||||
22 | "Selling price" means the consideration for a sale valued | ||||||
23 | in money
whether received in money or otherwise, including | ||||||
24 | cash, credits and
service, and shall be determined without any | ||||||
25 | deduction on account of the
serviceman's cost of the property | ||||||
26 | sold, the cost of materials used,
labor or service cost or any |
| |||||||
| |||||||
1 | other expense whatsoever, but does not
include interest or | ||||||
2 | finance charges which appear as separate items on
the bill of | ||||||
3 | sale or sales contract nor charges that are added to prices
by | ||||||
4 | sellers on account of the seller's duty to collect, from the
| ||||||
5 | purchaser, the tax that is imposed by this Act.
| ||||||
6 | "Department" means the Department of Revenue.
| ||||||
7 | "Person" means any natural individual, firm, partnership,
| ||||||
8 | association, joint stock company, joint venture, public or | ||||||
9 | private
corporation, limited liability company, and any | ||||||
10 | receiver, executor, trustee,
guardian or other representative | ||||||
11 | appointed by order of any court.
| ||||||
12 | "Sale of service" means any transaction except:
| ||||||
13 | (1) a retail sale of tangible personal property taxable | ||||||
14 | under the
Retailers' Occupation Tax Act or under the Use | ||||||
15 | Tax Act.
| ||||||
16 | (2) a sale of tangible personal property for the | ||||||
17 | purpose of resale
made in compliance with Section 2c of the | ||||||
18 | Retailers' Occupation Tax Act.
| ||||||
19 | (3) except as hereinafter provided, a sale or transfer | ||||||
20 | of tangible
personal property as an incident to the | ||||||
21 | rendering of service for or by
any governmental body, or | ||||||
22 | for or by any corporation, society,
association, | ||||||
23 | foundation or institution organized and operated
| ||||||
24 | exclusively for charitable, religious or educational | ||||||
25 | purposes or any
not-for-profit corporation, society, | ||||||
26 | association, foundation,
institution or organization which |
| |||||||
| |||||||
1 | has no compensated officers or
employees and which is | ||||||
2 | organized and operated primarily for the
recreation of | ||||||
3 | persons 55 years of age or older. A limited liability | ||||||
4 | company
may qualify for the exemption under this paragraph | ||||||
5 | only if the limited
liability company is organized and | ||||||
6 | operated exclusively for educational
purposes.
| ||||||
7 | (4) a sale or transfer of tangible personal
property as | ||||||
8 | an incident to the
rendering of service for interstate | ||||||
9 | carriers for hire for use as rolling stock
moving in | ||||||
10 | interstate commerce or by lessors under a lease of one year | ||||||
11 | or
longer, executed or in effect at the time of purchase of | ||||||
12 | personal property, to
interstate carriers for hire for use | ||||||
13 | as rolling stock moving in interstate
commerce so long as | ||||||
14 | so used by such interstate carriers for hire, and equipment
| ||||||
15 | operated by a telecommunications provider, licensed as a | ||||||
16 | common carrier by the
Federal Communications Commission, | ||||||
17 | which is permanently installed in or affixed
to aircraft | ||||||
18 | moving in interstate commerce.
| ||||||
19 | (4a) a sale or transfer of tangible personal
property | ||||||
20 | as an incident
to the rendering of service for owners, | ||||||
21 | lessors, or shippers of tangible
personal property which is | ||||||
22 | utilized by interstate carriers for hire for
use as rolling | ||||||
23 | stock moving in interstate commerce so long as so used by
| ||||||
24 | interstate carriers for hire, and equipment operated by a
| ||||||
25 | telecommunications provider, licensed as a common carrier | ||||||
26 | by the Federal
Communications Commission, which is |
| |||||||
| |||||||
1 | permanently installed in or affixed to
aircraft moving in | ||||||
2 | interstate commerce.
| ||||||
3 | (4a-5) on and after July 1, 2003 and through June 30, | ||||||
4 | 2004, a sale or transfer of a motor vehicle
of
the
second | ||||||
5 | division with a gross vehicle weight in excess of 8,000 | ||||||
6 | pounds as an
incident to the rendering of service if that | ||||||
7 | motor
vehicle is subject
to the commercial distribution fee | ||||||
8 | imposed under Section 3-815.1 of the
Illinois Vehicle
Code. | ||||||
9 | Beginning on July 1, 2004 and through June 30, 2005, the | ||||||
10 | use in this State of motor vehicles of the second division: | ||||||
11 | (i) with a gross vehicle weight rating in excess of 8,000 | ||||||
12 | pounds; (ii) that are subject to the commercial | ||||||
13 | distribution fee imposed under Section 3-815.1 of the | ||||||
14 | Illinois Vehicle Code; and (iii) that are primarily used | ||||||
15 | for commercial purposes. Through June 30, 2005, this
| ||||||
16 | exemption applies to repair and replacement parts added | ||||||
17 | after the
initial
purchase of such a motor vehicle if that | ||||||
18 | motor vehicle is used in a manner that
would
qualify for | ||||||
19 | the rolling stock exemption otherwise provided for in this | ||||||
20 | Act. For purposes of this paragraph, "used for commercial | ||||||
21 | purposes" means the transportation of persons or property | ||||||
22 | in furtherance of any commercial or industrial enterprise | ||||||
23 | whether for-hire or not.
| ||||||
24 | (5) a sale or transfer of machinery and equipment used | ||||||
25 | primarily in the
process of the manufacturing or | ||||||
26 | assembling, either in an existing, an expanded
or a new |
| |||||||
| |||||||
1 | manufacturing facility, of tangible personal property for | ||||||
2 | wholesale or
retail sale or lease, whether such sale or | ||||||
3 | lease is made directly by the
manufacturer or by some other | ||||||
4 | person, whether the materials used in the process
are owned | ||||||
5 | by the manufacturer or some other person, or whether such | ||||||
6 | sale or
lease is made apart from or as an incident to the | ||||||
7 | seller's engaging in a
service occupation and the | ||||||
8 | applicable tax is a Service Use Tax or Service
Occupation | ||||||
9 | Tax, rather than Use Tax or Retailers' Occupation Tax.
| ||||||
10 | (5a) the repairing, reconditioning or remodeling, for | ||||||
11 | a
common carrier by rail, of tangible personal property | ||||||
12 | which belongs to such
carrier for hire, and as to which | ||||||
13 | such carrier receives the physical possession
of the | ||||||
14 | repaired, reconditioned or remodeled item of tangible | ||||||
15 | personal property
in Illinois, and which such carrier | ||||||
16 | transports, or shares with another common
carrier in the | ||||||
17 | transportation of such property, out of Illinois on a | ||||||
18 | standard
uniform bill of lading showing the person who | ||||||
19 | repaired, reconditioned or
remodeled the property to a | ||||||
20 | destination outside Illinois, for use outside
Illinois.
| ||||||
21 | (5b) a sale or transfer of tangible personal property | ||||||
22 | which is produced by
the seller thereof on special order in | ||||||
23 | such a way as to have made the
applicable tax the Service | ||||||
24 | Occupation Tax or the Service Use Tax, rather than
the | ||||||
25 | Retailers' Occupation Tax or the Use Tax, for an interstate | ||||||
26 | carrier by rail
which receives the physical possession of |
| |||||||
| |||||||
1 | such property in Illinois, and which
transports such | ||||||
2 | property, or shares with another common carrier in the
| ||||||
3 | transportation of such property, out of Illinois on a | ||||||
4 | standard uniform bill of
lading showing the seller of the | ||||||
5 | property as the shipper or consignor of such
property to a | ||||||
6 | destination outside Illinois, for use outside Illinois.
| ||||||
7 | (6) until July 1, 2003, a sale or transfer of | ||||||
8 | distillation machinery
and equipment, sold
as a unit or kit | ||||||
9 | and assembled or installed by the retailer, which
machinery | ||||||
10 | and equipment is certified by the user to be used only for | ||||||
11 | the
production of ethyl alcohol that will be used for | ||||||
12 | consumption as motor fuel
or as a component of motor fuel | ||||||
13 | for the personal use of such user and not
subject to sale | ||||||
14 | or resale.
| ||||||
15 | (7) at the election of any serviceman not required to | ||||||
16 | be
otherwise registered as a retailer under Section 2a of | ||||||
17 | the Retailers'
Occupation Tax Act, made for each fiscal | ||||||
18 | year sales
of service in which the aggregate annual cost | ||||||
19 | price of tangible
personal property transferred as an | ||||||
20 | incident to the sales of service is
less than 35%, or 75% | ||||||
21 | in the case of servicemen transferring prescription
drugs | ||||||
22 | or servicemen engaged in graphic arts production, of the | ||||||
23 | aggregate
annual total gross receipts from all sales of | ||||||
24 | service. The purchase of
such tangible personal property by | ||||||
25 | the serviceman shall be subject to tax
under the Retailers' | ||||||
26 | Occupation Tax Act and the Use Tax Act.
However, if a
|
| |||||||
| |||||||
1 | primary serviceman who has made the election described in | ||||||
2 | this paragraph
subcontracts service work to a secondary | ||||||
3 | serviceman who has also made the
election described in this | ||||||
4 | paragraph, the primary serviceman does not
incur a Use Tax | ||||||
5 | liability if the secondary serviceman (i) has paid or will | ||||||
6 | pay
Use
Tax on his or her cost price of any tangible | ||||||
7 | personal property transferred
to the primary serviceman | ||||||
8 | and (ii) certifies that fact in writing to the
primary
| ||||||
9 | serviceman.
| ||||||
10 | Tangible personal property transferred incident to the | ||||||
11 | completion of a
maintenance agreement is exempt from the tax | ||||||
12 | imposed pursuant to this Act.
| ||||||
13 | Exemption (5) also includes machinery and equipment used in | ||||||
14 | the general
maintenance or repair of such exempt machinery and | ||||||
15 | equipment or for in-house
manufacture of exempt machinery and | ||||||
16 | equipment. For the purposes of exemption
(5), each of these | ||||||
17 | terms shall have the following meanings: (1) "manufacturing
| ||||||
18 | process" shall mean the production of any article of tangible | ||||||
19 | personal
property, whether such article is a finished product | ||||||
20 | or an article for use in
the process of manufacturing or | ||||||
21 | assembling a different article of tangible
personal property, | ||||||
22 | by procedures commonly regarded as manufacturing,
processing, | ||||||
23 | fabricating, or refining which changes some existing
material | ||||||
24 | or materials into a material with a different form, use or
| ||||||
25 | name. In relation to a recognized integrated business composed | ||||||
26 | of a
series of operations which collectively constitute |
| |||||||
| |||||||
1 | manufacturing, or
individually constitute manufacturing | ||||||
2 | operations, the manufacturing
process shall be deemed to | ||||||
3 | commence with the first operation or stage of
production in the | ||||||
4 | series, and shall not be deemed to end until the
completion of | ||||||
5 | the final product in the last operation or stage of
production | ||||||
6 | in the series; and further, for purposes of exemption (5),
| ||||||
7 | photoprocessing is deemed to be a manufacturing process of | ||||||
8 | tangible
personal property for wholesale or retail sale; (2) | ||||||
9 | "assembling process" shall
mean the production of any article | ||||||
10 | of tangible personal property, whether such
article is a | ||||||
11 | finished product or an article for use in the process of
| ||||||
12 | manufacturing or assembling a different article of tangible | ||||||
13 | personal
property, by the combination of existing materials in | ||||||
14 | a manner commonly
regarded as assembling which results in a | ||||||
15 | material of a different form,
use or name; (3) "machinery" | ||||||
16 | shall mean major mechanical machines or
major components of | ||||||
17 | such machines contributing to a manufacturing or
assembling | ||||||
18 | process; and (4) "equipment" shall include any independent
| ||||||
19 | device or tool separate from any machinery but essential to an
| ||||||
20 | integrated manufacturing or assembly process; including | ||||||
21 | computers
used primarily in a manufacturer's computer
assisted | ||||||
22 | design, computer assisted manufacturing (CAD/CAM) system;
or | ||||||
23 | any subunit or assembly comprising a component of any machinery | ||||||
24 | or
auxiliary, adjunct or attachment parts of machinery, such as | ||||||
25 | tools, dies,
jigs, fixtures, patterns and molds; or any parts | ||||||
26 | which require periodic
replacement in the course of normal |
| |||||||
| |||||||
1 | operation; but shall not include hand
tools.
Equipment includes | ||||||
2 | chemicals or chemicals acting as catalysts but only if the
| ||||||
3 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
4 | immediate change
upon a
product being manufactured or assembled | ||||||
5 | for wholesale or retail sale or
lease.
The purchaser of such | ||||||
6 | machinery and equipment who has an active
resale registration | ||||||
7 | number shall furnish such number to the seller at the
time of | ||||||
8 | purchase. The user of such machinery and equipment and tools
| ||||||
9 | without an active resale registration number shall prepare a | ||||||
10 | certificate of
exemption for each transaction stating facts | ||||||
11 | establishing the exemption for
that transaction, which | ||||||
12 | certificate shall be available to the Department
for inspection | ||||||
13 | or audit. The Department shall prescribe the form of the
| ||||||
14 | certificate.
| ||||||
15 | Any informal rulings, opinions or letters issued by the | ||||||
16 | Department in
response to an inquiry or request for any opinion | ||||||
17 | from any person
regarding the coverage and applicability of | ||||||
18 | exemption (5) to specific
devices shall be published, | ||||||
19 | maintained as a public record, and made
available for public | ||||||
20 | inspection and copying. If the informal ruling,
opinion or | ||||||
21 | letter contains trade secrets or other confidential
| ||||||
22 | information, where possible the Department shall delete such | ||||||
23 | information
prior to publication. Whenever such informal | ||||||
24 | rulings, opinions, or
letters contain any policy of general | ||||||
25 | applicability, the Department
shall formulate and adopt such | ||||||
26 | policy as a rule in accordance with the
provisions of the |
| |||||||
| |||||||
1 | Illinois Administrative Procedure Act.
| ||||||
2 | On and after July 1, 1987, no entity otherwise eligible | ||||||
3 | under exemption
(3) of this Section shall make tax free | ||||||
4 | purchases unless it has an active
exemption identification | ||||||
5 | number issued by the Department.
| ||||||
6 | The purchase, employment and transfer of such tangible | ||||||
7 | personal
property as newsprint and ink for the primary purpose | ||||||
8 | of conveying news
(with or without other information) is not a | ||||||
9 | purchase, use or sale of
service or of tangible personal | ||||||
10 | property within the meaning of this Act.
| ||||||
11 | "Serviceman" means any person who is engaged in the | ||||||
12 | occupation of
making sales of service.
| ||||||
13 | "Sale at retail" means "sale at retail" as defined in the | ||||||
14 | Retailers'
Occupation Tax Act.
| ||||||
15 | "Supplier" means any person who makes sales of tangible | ||||||
16 | personal
property to servicemen for the purpose of resale as an | ||||||
17 | incident to a
sale of service.
| ||||||
18 | "Serviceman maintaining a place of business in this State", | ||||||
19 | or any
like term, means and includes any serviceman:
| ||||||
20 | 1. having or maintaining within this State, directly or | ||||||
21 | by a
subsidiary, an office, distribution house, sales | ||||||
22 | house, warehouse or
other place of business, or any agent | ||||||
23 | or other representative operating
within this State under | ||||||
24 | the authority of the serviceman or its
subsidiary, | ||||||
25 | irrespective of whether such place of business or agent or
| ||||||
26 | other representative is located here permanently or |
| |||||||
| |||||||
1 | temporarily, or
whether such serviceman or subsidiary is | ||||||
2 | licensed to do business in this
State;
| ||||||
3 | 2. soliciting orders for tangible personal property by | ||||||
4 | means of a
telecommunication or television shopping system | ||||||
5 | (which utilizes toll free
numbers) which is intended by the | ||||||
6 | retailer to be broadcast by cable
television or other means | ||||||
7 | of broadcasting, to consumers located in this State;
| ||||||
8 | 3. pursuant to a contract with a broadcaster or | ||||||
9 | publisher located in this
State, soliciting orders for | ||||||
10 | tangible personal property by means of advertising
which is | ||||||
11 | disseminated primarily to consumers located in this State | ||||||
12 | and only
secondarily to bordering jurisdictions;
| ||||||
13 | 4. soliciting orders for tangible personal property by | ||||||
14 | mail if the
solicitations are substantial and recurring and | ||||||
15 | if the retailer benefits
from any banking, financing, debt | ||||||
16 | collection, telecommunication, or
marketing activities | ||||||
17 | occurring in this State or benefits from the location
in | ||||||
18 | this State of authorized installation, servicing, or | ||||||
19 | repair facilities;
| ||||||
20 | 5. being owned or controlled by the same interests | ||||||
21 | which own or
control any retailer engaging in business in | ||||||
22 | the same or similar line of
business in this State;
| ||||||
23 | 6. having a franchisee or licensee operating under its | ||||||
24 | trade name if
the franchisee or licensee is required to | ||||||
25 | collect the tax under this Section;
| ||||||
26 | 7. pursuant to a contract with a cable television |
| |||||||
| |||||||
1 | operator located in
this State, soliciting orders for | ||||||
2 | tangible personal property by means of
advertising which is | ||||||
3 | transmitted or distributed over a cable television
system | ||||||
4 | in this State; or
| ||||||
5 | 8. engaging in activities in Illinois, which | ||||||
6 | activities in the
state in which the supply business | ||||||
7 | engaging in such activities is located
would constitute | ||||||
8 | maintaining a place of business in that state.
| ||||||
9 | (Source: P.A. 92-484, eff. 8-23-01; 93-23, eff. 6-20-03; 93-24, | ||||||
10 | eff. 6-20-03; 93-1033, eff. 9-3-04.)
| ||||||
11 | Section 25. The Service Occupation Tax Act is amended by | ||||||
12 | changing Section 2 as follows:
| ||||||
13 | (35 ILCS 115/2) (from Ch. 120, par. 439.102)
| ||||||
14 | Sec. 2. "Transfer" means any transfer of the title to | ||||||
15 | property or of
the ownership of property whether or not the | ||||||
16 | transferor retains title as
security for the payment of amounts | ||||||
17 | due him from the transferee.
| ||||||
18 | "Cost Price" means the consideration paid by the serviceman | ||||||
19 | for a
purchase valued in money, whether paid in money or | ||||||
20 | otherwise, including
cash, credits and services, and shall be | ||||||
21 | determined without any deduction
on account of the supplier's | ||||||
22 | cost of the property sold or on account of any
other expense | ||||||
23 | incurred by the supplier. When a serviceman contracts out
part | ||||||
24 | or all of the services required in his sale of service, it |
| |||||||
| |||||||
1 | shall be
presumed that the cost price to the serviceman of the | ||||||
2 | property
transferred to him by his or her subcontractor is | ||||||
3 | equal to 50% of the
subcontractor's charges to the serviceman | ||||||
4 | in the absence of proof of the
consideration paid by the | ||||||
5 | subcontractor for the purchase of such
property.
| ||||||
6 | "Department" means the Department of Revenue.
| ||||||
7 | "Person" means any natural individual, firm, partnership, | ||||||
8 | association, joint
stock company, joint venture, public or | ||||||
9 | private corporation, limited liability
company, and any | ||||||
10 | receiver, executor, trustee, guardian or other representative
| ||||||
11 | appointed by order of any court.
| ||||||
12 | "Sale of Service" means any transaction except:
| ||||||
13 | (a) A retail sale of tangible personal property taxable | ||||||
14 | under the Retailers'
Occupation Tax Act or under the Use Tax | ||||||
15 | Act.
| ||||||
16 | (b) A sale of tangible personal property for the purpose of | ||||||
17 | resale made in
compliance with Section 2c of the Retailers' | ||||||
18 | Occupation Tax Act.
| ||||||
19 | (c) Except as hereinafter provided, a sale or transfer of | ||||||
20 | tangible personal
property as an incident to the rendering of | ||||||
21 | service for or by any governmental
body or for or by any | ||||||
22 | corporation, society, association, foundation or
institution | ||||||
23 | organized and operated exclusively for charitable, religious | ||||||
24 | or
educational purposes or any not-for-profit corporation, | ||||||
25 | society, association,
foundation, institution or organization | ||||||
26 | which has no compensated officers or
employees and which is |
| |||||||
| |||||||
1 | organized and operated primarily for the recreation of
persons | ||||||
2 | 55 years of age or older. A limited liability company may | ||||||
3 | qualify for
the exemption under this paragraph only if the | ||||||
4 | limited liability company is
organized and operated | ||||||
5 | exclusively for educational purposes.
| ||||||
6 | (d) A sale or transfer of tangible personal
property
as an | ||||||
7 | incident to the
rendering of service for interstate carriers | ||||||
8 | for hire for use as rolling stock
moving in interstate commerce | ||||||
9 | or lessors under leases of one year or longer,
executed or in | ||||||
10 | effect at the time of purchase, to interstate carriers for hire
| ||||||
11 | for use as rolling stock moving in interstate commerce, and | ||||||
12 | equipment operated
by a telecommunications provider, licensed | ||||||
13 | as a common
carrier by the Federal Communications Commission, | ||||||
14 | which is permanently
installed in or affixed to aircraft moving | ||||||
15 | in interstate commerce.
| ||||||
16 | (d-1) A sale or transfer of tangible personal
property as | ||||||
17 | an incident to
the rendering of service for owners, lessors or | ||||||
18 | shippers of tangible personal
property which is utilized by | ||||||
19 | interstate carriers for hire for use as rolling
stock moving in | ||||||
20 | interstate commerce, and equipment operated
by a | ||||||
21 | telecommunications provider, licensed as a common carrier by | ||||||
22 | the
Federal Communications Commission, which is permanently | ||||||
23 | installed in or
affixed to aircraft moving in interstate | ||||||
24 | commerce.
| ||||||
25 | (d-1.1) On and after July 1, 2003 and through June 30, | ||||||
26 | 2004, a sale or transfer of a motor vehicle
of the
second |
| |||||||
| |||||||
1 | division with a gross vehicle weight in excess of 8,000 pounds | ||||||
2 | as an
incident to the rendering of service if that motor
| ||||||
3 | vehicle is subject
to the commercial distribution fee imposed | ||||||
4 | under Section 3-815.1 of the
Illinois Vehicle
Code. Beginning | ||||||
5 | on July 1, 2004 and through June 30, 2005, the use in this | ||||||
6 | State of motor vehicles of the second division: (i) with a | ||||||
7 | gross vehicle weight rating in excess of 8,000 pounds; (ii) | ||||||
8 | that are subject to the commercial distribution fee imposed | ||||||
9 | under Section 3-815.1 of the Illinois Vehicle Code; and (iii) | ||||||
10 | that are primarily used for commercial purposes. Through June | ||||||
11 | 30, 2005, this exemption applies to repair and replacement | ||||||
12 | parts added after the
initial
purchase of such a motor vehicle | ||||||
13 | if that motor vehicle is used in a manner that
would
qualify | ||||||
14 | for the rolling stock exemption otherwise provided for in this | ||||||
15 | Act. For purposes of this paragraph, "used for commercial | ||||||
16 | purposes" means the transportation of persons or property in | ||||||
17 | furtherance of any commercial or industrial enterprise whether | ||||||
18 | for-hire or not.
| ||||||
19 | (d-2) The repairing, reconditioning or remodeling, for a | ||||||
20 | common carrier by
rail, of tangible personal property which | ||||||
21 | belongs to such carrier for hire, and
as to which such carrier | ||||||
22 | receives the physical possession of the repaired,
| ||||||
23 | reconditioned or remodeled item of tangible personal property | ||||||
24 | in Illinois, and
which such carrier transports, or shares with | ||||||
25 | another common carrier in the
transportation of such property, | ||||||
26 | out of Illinois on a standard uniform bill of
lading showing |
| |||||||
| |||||||
1 | the person who repaired, reconditioned or remodeled the | ||||||
2 | property
as the shipper or consignor of such property to a | ||||||
3 | destination outside Illinois,
for use outside Illinois.
| ||||||
4 | (d-3) A sale or transfer of tangible personal property | ||||||
5 | which
is produced by the seller thereof on special order in | ||||||
6 | such a way as to have
made the applicable tax the Service | ||||||
7 | Occupation Tax or the Service Use Tax,
rather than the | ||||||
8 | Retailers' Occupation Tax or the Use Tax, for an interstate
| ||||||
9 | carrier by rail which receives the physical possession of such | ||||||
10 | property in
Illinois, and which transports such property, or | ||||||
11 | shares with another common
carrier in the transportation of | ||||||
12 | such property, out of Illinois on a standard
uniform bill of | ||||||
13 | lading showing the seller of the property as the shipper or
| ||||||
14 | consignor of such property to a destination outside Illinois, | ||||||
15 | for use outside
Illinois.
| ||||||
16 | (d-4) Until January 1, 1997, a sale, by a registered | ||||||
17 | serviceman paying tax
under this Act to the Department, of | ||||||
18 | special order printed materials delivered
outside Illinois and | ||||||
19 | which are not returned to this State, if delivery is made
by | ||||||
20 | the seller or agent of the seller, including an agent who | ||||||
21 | causes the product
to be delivered outside Illinois by a common | ||||||
22 | carrier or the U.S.
postal service.
| ||||||
23 | (e) A sale or transfer of machinery and equipment used | ||||||
24 | primarily in
the process of the manufacturing or assembling, | ||||||
25 | either in an existing, an
expanded or a new manufacturing | ||||||
26 | facility, of tangible personal property for
wholesale or retail |
| |||||||
| |||||||
1 | sale or lease, whether such sale or lease is made directly
by | ||||||
2 | the manufacturer or by some other person, whether the materials | ||||||
3 | used in the
process are owned by the manufacturer or some other | ||||||
4 | person, or whether such
sale or lease is made apart from or as | ||||||
5 | an incident to the seller's engaging in
a service occupation | ||||||
6 | and the applicable tax is a Service Occupation Tax or
Service | ||||||
7 | Use Tax, rather than Retailers' Occupation Tax or Use Tax.
| ||||||
8 | (f) Until July 1, 2003, the sale or transfer of | ||||||
9 | distillation
machinery
and equipment, sold as a
unit or kit and | ||||||
10 | assembled or installed by the retailer, which machinery
and | ||||||
11 | equipment is certified by the user to be used only for the | ||||||
12 | production
of ethyl alcohol that will be used for consumption | ||||||
13 | as motor fuel or as a
component of motor fuel for the personal | ||||||
14 | use of such user and not subject
to sale or resale.
| ||||||
15 | (g) At the election of any serviceman not required to be | ||||||
16 | otherwise
registered as a retailer under Section 2a of the | ||||||
17 | Retailers' Occupation Tax Act,
made for each fiscal year sales | ||||||
18 | of service in which the aggregate annual cost
price of tangible | ||||||
19 | personal property transferred as an incident to the sales of
| ||||||
20 | service is less than 35% (75% in the case of servicemen | ||||||
21 | transferring
prescription drugs or servicemen engaged in | ||||||
22 | graphic arts production) of the
aggregate annual total gross | ||||||
23 | receipts from all sales of service. The purchase
of such | ||||||
24 | tangible personal property by the serviceman shall be subject | ||||||
25 | to tax
under the Retailers' Occupation Tax Act and the Use Tax | ||||||
26 | Act.
However, if a
primary serviceman who has made the election |
| |||||||
| |||||||
1 | described in this paragraph
subcontracts service work to a | ||||||
2 | secondary serviceman who has also made the
election described | ||||||
3 | in this paragraph, the primary serviceman does not
incur a Use | ||||||
4 | Tax liability if the secondary serviceman (i) has paid or will | ||||||
5 | pay
Use
Tax on his or her cost price of any tangible personal | ||||||
6 | property transferred
to the primary serviceman and (ii) | ||||||
7 | certifies that fact in writing to the
primary serviceman.
| ||||||
8 | Tangible personal property transferred incident to the | ||||||
9 | completion of a
maintenance agreement is exempt from the tax | ||||||
10 | imposed pursuant to this Act.
| ||||||
11 | Exemption (e) also includes machinery and equipment used in | ||||||
12 | the
general maintenance or repair of such exempt machinery and | ||||||
13 | equipment or for
in-house manufacture of exempt machinery and | ||||||
14 | equipment.
For the purposes of exemption (e), each of these | ||||||
15 | terms shall have the following
meanings: (1) "manufacturing | ||||||
16 | process" shall mean the production of any
article of tangible | ||||||
17 | personal property, whether such article is a
finished product | ||||||
18 | or an article for use in the process of manufacturing
or | ||||||
19 | assembling a different article of tangible personal property, | ||||||
20 | by
procedures commonly regarded as manufacturing, processing, | ||||||
21 | fabricating,
or refining which changes some existing material | ||||||
22 | or materials into a
material with a different form, use or | ||||||
23 | name. In relation to a
recognized integrated business composed | ||||||
24 | of a series of operations which
collectively constitute | ||||||
25 | manufacturing, or individually constitute
manufacturing | ||||||
26 | operations, the manufacturing process shall be deemed to
|
| |||||||
| |||||||
1 | commence with the first operation or stage of production in the | ||||||
2 | series,
and shall not be deemed to end until the completion of | ||||||
3 | the final product
in the last operation or stage of production | ||||||
4 | in the series; and further for
purposes of exemption (e), | ||||||
5 | photoprocessing is deemed to be a manufacturing
process of | ||||||
6 | tangible personal property for wholesale or retail sale;
(2) | ||||||
7 | "assembling process" shall mean the production of any article | ||||||
8 | of
tangible personal property, whether such article is a | ||||||
9 | finished product
or an article for use in the process of | ||||||
10 | manufacturing or assembling a
different article of tangible | ||||||
11 | personal property, by the combination of
existing materials in | ||||||
12 | a manner commonly regarded as assembling which
results in a | ||||||
13 | material of a different form, use or name; (3) "machinery"
| ||||||
14 | shall mean major mechanical machines or major components of | ||||||
15 | such machines
contributing to a manufacturing or assembling | ||||||
16 | process; and (4) "equipment"
shall include any independent | ||||||
17 | device or tool separate from any machinery but
essential to an | ||||||
18 | integrated manufacturing or assembly process; including
| ||||||
19 | computers used primarily in a manufacturer's computer
assisted | ||||||
20 | design, computer assisted manufacturing (CAD/CAM) system; or | ||||||
21 | any
subunit or assembly comprising a component of any machinery | ||||||
22 | or auxiliary,
adjunct or attachment parts of machinery, such as | ||||||
23 | tools, dies, jigs, fixtures,
patterns and molds; or any parts | ||||||
24 | which require periodic replacement in the
course of normal | ||||||
25 | operation; but shall not include hand tools. Equipment
includes | ||||||
26 | chemicals or chemicals acting as catalysts but only if the |
| |||||||
| |||||||
1 | chemicals
or chemicals acting as catalysts effect a direct and | ||||||
2 | immediate change upon a
product being manufactured or assembled | ||||||
3 | for wholesale or retail sale or lease.
The purchaser of such | ||||||
4 | machinery and equipment
who has an active resale registration | ||||||
5 | number shall furnish such number to
the seller at the time of | ||||||
6 | purchase. The purchaser of such machinery and
equipment and | ||||||
7 | tools without an active resale registration number shall | ||||||
8 | furnish
to the seller a certificate of exemption for each | ||||||
9 | transaction stating facts
establishing the exemption for that | ||||||
10 | transaction, which certificate shall
be available to the | ||||||
11 | Department for inspection or audit.
| ||||||
12 | Except as provided in Section 2d of this Act, the rolling | ||||||
13 | stock exemption
applies to rolling
stock
used by an interstate
| ||||||
14 | carrier for hire, even just between points in Illinois, if such | ||||||
15 | rolling
stock transports, for hire, persons whose journeys or | ||||||
16 | property whose
shipments originate or terminate outside | ||||||
17 | Illinois.
| ||||||
18 | Any informal rulings, opinions or letters issued by the | ||||||
19 | Department in
response to an inquiry or request for any opinion | ||||||
20 | from any person
regarding the coverage and applicability of | ||||||
21 | exemption (e) to specific
devices shall be published, | ||||||
22 | maintained as a public record, and made
available for public | ||||||
23 | inspection and copying. If the informal ruling,
opinion or | ||||||
24 | letter contains trade secrets or other confidential
| ||||||
25 | information, where possible the Department shall delete such | ||||||
26 | information
prior to publication. Whenever such informal |
| |||||||
| |||||||
1 | rulings, opinions, or
letters contain any policy of general | ||||||
2 | applicability, the Department
shall formulate and adopt such | ||||||
3 | policy as a rule in accordance with the
provisions of the | ||||||
4 | Illinois Administrative Procedure Act.
| ||||||
5 | On and after July 1, 1987, no entity otherwise eligible | ||||||
6 | under exemption
(c) of this Section shall make tax free | ||||||
7 | purchases unless it has an active
exemption identification | ||||||
8 | number issued by the Department.
| ||||||
9 | "Serviceman" means any person who is engaged in the | ||||||
10 | occupation of
making sales of service.
| ||||||
11 | "Sale at Retail" means "sale at retail" as defined in the | ||||||
12 | Retailers'
Occupation Tax Act.
| ||||||
13 | "Supplier" means any person who makes sales of tangible | ||||||
14 | personal
property to servicemen for the purpose of resale as an | ||||||
15 | incident to a
sale of service.
| ||||||
16 | (Source: P.A. 92-484, eff. 8-23-01; 93-23, eff. 6-20-03; 93-24, | ||||||
17 | eff. 6-20-03; 93-1033, eff. 9-3-04.)
| ||||||
18 | Section 30. The Retailers' Occupation Tax Act is amended by | ||||||
19 | changing Sections 1 and 2-5 as follows:
| ||||||
20 | (35 ILCS 120/1) (from Ch. 120, par. 440)
| ||||||
21 | Sec. 1. Definitions. "Sale at retail" means any transfer of | ||||||
22 | the
ownership of or title to
tangible personal property to a | ||||||
23 | purchaser, for the purpose of use or
consumption, and not for | ||||||
24 | the purpose of resale in any form as tangible
personal property |
| |||||||
| |||||||
1 | to the extent not first subjected to a use for which it
was | ||||||
2 | purchased, for a valuable consideration: Provided that the | ||||||
3 | property
purchased is deemed to be purchased for the purpose of | ||||||
4 | resale, despite
first being used, to the extent to which it is | ||||||
5 | resold as an ingredient of
an intentionally produced product or | ||||||
6 | byproduct of manufacturing. For this
purpose, slag produced as | ||||||
7 | an incident to manufacturing pig iron or steel
and sold is | ||||||
8 | considered to be an intentionally produced byproduct of
| ||||||
9 | manufacturing. Transactions whereby the possession of the | ||||||
10 | property is
transferred but the seller retains the title as | ||||||
11 | security for payment of the
selling price shall be deemed to be | ||||||
12 | sales.
| ||||||
13 | "Sale at retail" shall be construed to include any transfer | ||||||
14 | of the
ownership of or title to tangible personal property to a | ||||||
15 | purchaser, for use
or consumption by any other person to whom | ||||||
16 | such purchaser may transfer the
tangible personal property | ||||||
17 | without a valuable consideration, and to include
any transfer, | ||||||
18 | whether made for or without a valuable consideration, for
| ||||||
19 | resale in any form as tangible personal property unless made in | ||||||
20 | compliance
with Section 2c of this Act.
| ||||||
21 | Sales of tangible personal property, which property, to the | ||||||
22 | extent not
first subjected to a use for which it was purchased, | ||||||
23 | as an ingredient or
constituent, goes into and forms a part of | ||||||
24 | tangible personal property
subsequently the subject of a "Sale | ||||||
25 | at retail", are not sales at retail as
defined in this Act: | ||||||
26 | Provided that the property purchased is deemed to be
purchased |
| |||||||
| |||||||
1 | for the purpose of resale, despite first being used, to the
| ||||||
2 | extent to which it is resold as an ingredient of an | ||||||
3 | intentionally produced
product or byproduct of manufacturing.
| ||||||
4 | "Sale at retail" includes all of the following services, as | ||||||
5 | enumerated in the North American Industry Classification | ||||||
6 | System Manual (NAICS), 1997, prepared by the United States | ||||||
7 | Office of Management and Budget: | ||||||
8 | (1) Specialized good warehousing and storage | ||||||
9 | (4931902). | ||||||
10 | (2) Household goods warehousing and storage (4931901). | ||||||
11 | (3) Marinas (7131901). | ||||||
12 | (4) Travel arrangement reservation services (5615). | ||||||
13 | (5) Consumer electronics repair and maintenance | ||||||
14 | (811211). | ||||||
15 | (6) Personal and household goods. | ||||||
16 | (7) Carpet and upholstery cleaning services (56174). | ||||||
17 | (8) Dating services (8129902). | ||||||
18 | (9) Hair, nail, and skin care (81211). | ||||||
19 | (10) Other personal services other than hair, nail, | ||||||
20 | facial, or nonpermanent
makeup services (81219). | ||||||
21 | (11) Dry cleaning and laundry, except coin-operated | ||||||
22 | (81232). | ||||||
23 | (12) Consumer goods rental (5322). | ||||||
24 | (13) General goods rental (5323). | ||||||
25 | (14) Diet and weight reducing services (812191). | ||||||
26 | (15) Investigation services (561611). |
| |||||||
| |||||||
1 | (16) Bail bonding (8129901). | ||||||
2 | (17) Telephone answering services (561421). | ||||||
3 | (18) Photographic studios, portrait (541921). | ||||||
4 | (19) Linen supply (812331). | ||||||
5 | (20) Industrial launderers (812332). | ||||||
6 | (21) Interior design services (54141). | ||||||
7 | (22) Computer systems design and related services | ||||||
8 | (5415). | ||||||
9 | (23) Credit bureaus (56145). | ||||||
10 | (24) Collection agencies (56144). | ||||||
11 | (25) Other business services, including copy shops | ||||||
12 | (561439). | ||||||
13 | (26) Automotive repair and maintenance (8111). | ||||||
14 | (27) Parking lots and garages (81293). | ||||||
15 | (28) Motor vehicle towing (48841). | ||||||
16 | (29) Racetracks (711212). | ||||||
17 | (30) Amusement parks and arcades (7131). | ||||||
18 | (31) Bowling Centers (71395). | ||||||
19 | (32) Cable and other program distribution (51322). | ||||||
20 | (33) Circuses (7111901). | ||||||
21 | (34) Coin operated amusement devices, except slots | ||||||
22 | (7139905). | ||||||
23 | (35) Golf courses and country clubs (71391). | ||||||
24 | (36) Fitness and recreational sports centers (711211). | ||||||
25 | (37) Sports teams and clubs (711211). | ||||||
26 | (38) Performing arts companies (7111). |
| |||||||
| |||||||
1 | (39) Miniature golf courses (7139904). | ||||||
2 | (40) Scenic and sightseeing transportation (487). | ||||||
3 | (41) Limousine services (48532). | ||||||
4 | (42) Unscheduled chartered passenger air | ||||||
5 | transportation (481211). | ||||||
6 | (43) Motion picture theaters, except drive-in theaters | ||||||
7 | (512131). | ||||||
8 | (44) Drive-in motion picture theaters (512132). | ||||||
9 | "Sale at retail" shall be construed to include any Illinois | ||||||
10 | florist's
sales transaction in which the purchase order is | ||||||
11 | received in Illinois by a
florist and the sale is for use or | ||||||
12 | consumption, but the Illinois florist
has a florist in another | ||||||
13 | state deliver the property to the purchaser or the
purchaser's | ||||||
14 | donee in such other state.
| ||||||
15 | Nonreusable tangible personal property that is used by | ||||||
16 | persons engaged in
the business of operating a restaurant, | ||||||
17 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
18 | transferred to customers in the ordinary course of business
as | ||||||
19 | part of the sale of food or beverages and is used to deliver, | ||||||
20 | package, or
consume food or beverages, regardless of where | ||||||
21 | consumption of the food or
beverages occurs. Examples of those | ||||||
22 | items include, but are not limited to
nonreusable, paper and | ||||||
23 | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | ||||||
24 | containers, utensils, straws, placemats, napkins, doggie bags, | ||||||
25 | and
wrapping or packaging
materials that are transferred to | ||||||
26 | customers as part of the sale of food or
beverages in the |
| |||||||
| |||||||
1 | ordinary course of business.
| ||||||
2 | The purchase, employment and transfer of such tangible | ||||||
3 | personal property
as newsprint and ink for the primary purpose | ||||||
4 | of conveying news (with or
without other information) is not a | ||||||
5 | purchase, use or sale of tangible
personal property.
| ||||||
6 | A person whose activities are organized and conducted | ||||||
7 | primarily as a
not-for-profit service enterprise, and who | ||||||
8 | engages in selling tangible
personal property at retail | ||||||
9 | (whether to the public or merely to members and
their guests) | ||||||
10 | is engaged in the business of selling tangible personal
| ||||||
11 | property at retail with respect to such transactions, excepting | ||||||
12 | only a
person organized and operated exclusively for | ||||||
13 | charitable, religious or
educational purposes either (1), to | ||||||
14 | the extent of sales by such person to
its members, students, | ||||||
15 | patients or inmates of tangible personal property to
be used | ||||||
16 | primarily for the purposes of such person, or (2), to the | ||||||
17 | extent of
sales by such person of tangible personal property | ||||||
18 | which is not sold or
offered for sale by persons organized for | ||||||
19 | profit. The selling of school
books and school supplies by | ||||||
20 | schools at retail to students is not
"primarily for the | ||||||
21 | purposes of" the school which does such selling. The
provisions | ||||||
22 | of this paragraph shall not apply to nor subject to taxation
| ||||||
23 | occasional dinners, socials or similar activities of a person | ||||||
24 | organized and
operated exclusively for charitable, religious | ||||||
25 | or educational purposes,
whether or not such activities are | ||||||
26 | open to the public.
|
| |||||||
| |||||||
1 | A person who is the recipient of a grant or contract under | ||||||
2 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | ||||||
3 | serves meals to
participants in the federal Nutrition Program | ||||||
4 | for the Elderly in return for
contributions established in | ||||||
5 | amount by the individual participant pursuant
to a schedule of | ||||||
6 | suggested fees as provided for in the federal Act is not
| ||||||
7 | engaged in the business of selling tangible personal property | ||||||
8 | at retail
with respect to such transactions.
| ||||||
9 | "Purchaser" means anyone who, through a sale at retail, | ||||||
10 | acquires the
ownership of or title to tangible personal | ||||||
11 | property for a valuable
consideration.
| ||||||
12 | "Reseller of motor fuel" means any person engaged in the | ||||||
13 | business of selling
or delivering or transferring title of | ||||||
14 | motor fuel to another person
other than for use or consumption.
| ||||||
15 | No person shall act as a reseller of motor fuel within this | ||||||
16 | State without
first being registered as a reseller pursuant to | ||||||
17 | Section 2c or a retailer
pursuant to Section 2a.
| ||||||
18 | "Selling price" or the "amount of sale" means the | ||||||
19 | consideration for a
sale valued in money whether received in | ||||||
20 | money or otherwise, including
cash, credits, property, other | ||||||
21 | than as hereinafter provided, and services,
but not including | ||||||
22 | the value of or credit given for traded-in tangible
personal | ||||||
23 | property where the item that is traded-in is of like kind and
| ||||||
24 | character as that which is being sold, and shall be determined | ||||||
25 | without any
deduction on account of the cost of the property | ||||||
26 | sold, the cost of
materials used, labor or service cost or any |
| |||||||
| |||||||
1 | other expense whatsoever, but
does not include charges that are | ||||||
2 | added to prices by sellers on account of
the seller's tax | ||||||
3 | liability under this Act, or on account of the seller's
duty to | ||||||
4 | collect, from the purchaser, the tax that is imposed by the Use | ||||||
5 | Tax
Act, or on account of the seller's tax liability under | ||||||
6 | Section 8-11-1 of
the Illinois Municipal Code, as heretofore | ||||||
7 | and hereafter amended, or on
account of the seller's tax | ||||||
8 | liability under the County Retailers'
Occupation Tax Act, or on | ||||||
9 | account of the seller's tax liability under the
Home Rule | ||||||
10 | Municipal Soft Drink Retailers' Occupation Tax,
or on account | ||||||
11 | of the seller's tax liability under any tax imposed under the
| ||||||
12 | "Regional Transportation Authority Act", approved December 12, | ||||||
13 | 1973.
Effective December 1, 1985, "selling price" shall include | ||||||
14 | charges that
are added to prices by sellers on account of the | ||||||
15 | seller's
tax liability under the Cigarette Tax Act, on account | ||||||
16 | of the sellers'
duty to collect, from the purchaser, the tax | ||||||
17 | imposed under the Cigarette
Use Tax Act, and on account of the | ||||||
18 | seller's duty to collect, from the
purchaser, any cigarette tax | ||||||
19 | imposed by a home rule unit.
| ||||||
20 | The phrase "like kind and character" shall be liberally | ||||||
21 | construed
(including but not limited to any form of motor | ||||||
22 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
23 | agricultural implement for any other
kind of farm or | ||||||
24 | agricultural implement), while not including a kind of item
| ||||||
25 | which, if sold at retail by that retailer, would be exempt from | ||||||
26 | retailers'
occupation tax and use tax as an isolated or |
| |||||||
| |||||||
1 | occasional sale.
| ||||||
2 | "Gross receipts" from the sales of tangible personal | ||||||
3 | property at retail
means the total selling price or the amount | ||||||
4 | of such sales, as hereinbefore
defined. In the case of charge | ||||||
5 | and time sales, the amount thereof shall be
included only as | ||||||
6 | and when payments are received by the seller.
Receipts or other | ||||||
7 | consideration derived by a seller from
the sale, transfer or | ||||||
8 | assignment of accounts receivable to a wholly owned
subsidiary | ||||||
9 | will not be deemed payments prior to the time the purchaser
| ||||||
10 | makes payment on such accounts.
| ||||||
11 | "Department" means the Department of Revenue.
| ||||||
12 | "Person" means any natural individual, firm, partnership, | ||||||
13 | association,
joint stock company, joint adventure, public or | ||||||
14 | private corporation, limited
liability company, or a receiver, | ||||||
15 | executor, trustee, guardian or other
representative appointed | ||||||
16 | by order of any court.
| ||||||
17 | The isolated or occasional sale of tangible personal | ||||||
18 | property at retail
by a person who does not hold himself out as | ||||||
19 | being engaged (or who does not
habitually engage) in selling | ||||||
20 | such tangible personal property at retail, or
a sale through a | ||||||
21 | bulk vending machine, does not constitute engaging in a
| ||||||
22 | business of selling such tangible personal property at retail | ||||||
23 | within the
meaning of this Act; provided that any person who is | ||||||
24 | engaged in a business
which is not subject to the tax imposed | ||||||
25 | by this Act because of involving
the sale of or a contract to | ||||||
26 | sell real estate or a construction contract to
improve real |
| |||||||
| |||||||
1 | estate or a construction contract to engineer, install, and
| ||||||
2 | maintain an integrated system of products, but who, in the | ||||||
3 | course of
conducting such business,
transfers tangible | ||||||
4 | personal property to users or consumers in the finished
form in | ||||||
5 | which it was purchased, and which does not become real estate | ||||||
6 | or was
not engineered and installed, under any provision of a | ||||||
7 | construction contract or
real estate sale or real estate sales | ||||||
8 | agreement entered into with some other
person arising out of or | ||||||
9 | because of such nontaxable business, is engaged in the
business | ||||||
10 | of selling tangible personal property at retail to the extent | ||||||
11 | of the
value of the tangible personal property so transferred. | ||||||
12 | If, in such a
transaction, a separate charge is made for the | ||||||
13 | tangible personal property so
transferred, the value of such | ||||||
14 | property, for the purpose of this Act, shall be
the amount so | ||||||
15 | separately charged, but not less than the cost of such property
| ||||||
16 | to the transferor; if no separate charge is made, the value of | ||||||
17 | such property,
for the purposes of this Act, is the cost to the | ||||||
18 | transferor of such tangible
personal property. Construction | ||||||
19 | contracts for the improvement of real estate
consisting of | ||||||
20 | engineering, installation, and maintenance of voice, data, | ||||||
21 | video,
security, and all telecommunication systems do not | ||||||
22 | constitute engaging in a
business of selling tangible personal | ||||||
23 | property at retail within the meaning of
this Act if they are | ||||||
24 | sold at one specified contract price.
| ||||||
25 | A person who holds himself or herself out as being engaged | ||||||
26 | (or who habitually
engages) in selling tangible personal |
| |||||||
| |||||||
1 | property at retail is a person
engaged in the business of | ||||||
2 | selling tangible personal property at retail
hereunder with | ||||||
3 | respect to such sales (and not primarily in a service
| ||||||
4 | occupation) notwithstanding the fact that such person designs | ||||||
5 | and produces
such tangible personal property on special order | ||||||
6 | for the purchaser and in
such a way as to render the property | ||||||
7 | of value only to such purchaser, if
such tangible personal | ||||||
8 | property so produced on special order serves
substantially the | ||||||
9 | same function as stock or standard items of tangible
personal | ||||||
10 | property that are sold at retail.
| ||||||
11 | Persons who engage in the business of transferring tangible | ||||||
12 | personal
property upon the redemption of trading stamps are | ||||||
13 | engaged in the business
of selling such property at retail and | ||||||
14 | shall be liable for and shall pay
the tax imposed by this Act | ||||||
15 | on the basis of the retail value of the
property transferred | ||||||
16 | upon redemption of such stamps.
| ||||||
17 | "Bulk vending machine" means a vending machine,
containing | ||||||
18 | unsorted confections, nuts, toys, or other items designed
| ||||||
19 | primarily to be used or played with by children
which, when a | ||||||
20 | coin or coins of a denomination not larger than $0.50 are
| ||||||
21 | inserted, are dispensed in equal portions, at random and
| ||||||
22 | without selection by the customer.
| ||||||
23 | (Source: P.A. 92-213, eff. 1-1-02.)
| ||||||
24 | (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
| ||||||
25 | Sec. 2-5. Exemptions. Gross receipts from proceeds from the |
| |||||||
| |||||||
1 | sale of
the following tangible personal property are exempt | ||||||
2 | from the tax imposed
by this Act:
| ||||||
3 | (1) Farm chemicals.
| ||||||
4 | (2) Farm machinery and equipment, both new and used, | ||||||
5 | including that
manufactured on special order, certified by the | ||||||
6 | purchaser to be used
primarily for production agriculture or | ||||||
7 | State or federal agricultural
programs, including individual | ||||||
8 | replacement parts for the machinery and
equipment, including | ||||||
9 | machinery and equipment purchased for lease,
and including | ||||||
10 | implements of husbandry defined in Section 1-130 of
the | ||||||
11 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
12 | chemical and
fertilizer spreaders, and nurse wagons required to | ||||||
13 | be registered
under Section 3-809 of the Illinois Vehicle Code,
| ||||||
14 | but
excluding other motor vehicles required to be registered | ||||||
15 | under the Illinois
Vehicle Code.
Horticultural polyhouses or | ||||||
16 | hoop houses used for propagating, growing, or
overwintering | ||||||
17 | plants shall be considered farm machinery and equipment under
| ||||||
18 | this item (2).
Agricultural chemical tender tanks and dry boxes | ||||||
19 | shall include units sold
separately from a motor vehicle | ||||||
20 | required to be licensed and units sold mounted
on a motor | ||||||
21 | vehicle required to be licensed, if the selling price of the | ||||||
22 | tender
is separately stated.
| ||||||
23 | Farm machinery and equipment shall include precision | ||||||
24 | farming equipment
that is
installed or purchased to be | ||||||
25 | installed on farm machinery and equipment
including, but not | ||||||
26 | limited to, tractors, harvesters, sprayers, planters,
seeders, |
| |||||||
| |||||||
1 | or spreaders.
Precision farming equipment includes, but is not | ||||||
2 | limited to,
soil testing sensors, computers, monitors, | ||||||
3 | software, global positioning
and mapping systems, and other | ||||||
4 | such equipment.
| ||||||
5 | Farm machinery and equipment also includes computers, | ||||||
6 | sensors, software, and
related equipment used primarily in the
| ||||||
7 | computer-assisted operation of production agriculture | ||||||
8 | facilities, equipment,
and activities such as, but
not limited | ||||||
9 | to,
the collection, monitoring, and correlation of
animal and | ||||||
10 | crop data for the purpose of
formulating animal diets and | ||||||
11 | agricultural chemicals. This item (7) is exempt
from the | ||||||
12 | provisions of
Section 2-70.
| ||||||
13 | (3) Until July 1, 2003, distillation machinery and | ||||||
14 | equipment, sold as a
unit or kit,
assembled or installed by the | ||||||
15 | retailer, certified by the user to be used
only for the | ||||||
16 | production of ethyl alcohol that will be used for consumption
| ||||||
17 | as motor fuel or as a component of motor fuel for the personal | ||||||
18 | use of the
user, and not subject to sale or resale.
| ||||||
19 | (4) Until July 1, 2003 and beginning again September 1, | ||||||
20 | 2004, graphic arts machinery and equipment, including
repair | ||||||
21 | and
replacement parts, both new and used, and including that | ||||||
22 | manufactured on
special order or purchased for lease, certified | ||||||
23 | by the purchaser to be used
primarily for graphic arts | ||||||
24 | production.
Equipment includes chemicals or
chemicals acting | ||||||
25 | as catalysts but only if
the chemicals or chemicals acting as | ||||||
26 | catalysts effect a direct and immediate
change upon a
graphic |
| |||||||
| |||||||
1 | arts product.
| ||||||
2 | (5) (Blank).
A motor vehicle of the first division, a motor | ||||||
3 | vehicle of the second
division that is a self-contained motor | ||||||
4 | vehicle designed or permanently
converted to provide living | ||||||
5 | quarters for recreational, camping, or travel
use, with direct | ||||||
6 | walk through access to the living quarters from the
driver's | ||||||
7 | seat, or a motor vehicle of the second division that is of the | ||||||
8 | van
configuration designed for the transportation of not less | ||||||
9 | than 7 nor more
than 16 passengers, as defined in Section 1-146 | ||||||
10 | of the Illinois Vehicle
Code, that is used for automobile | ||||||
11 | renting, as defined in the Automobile
Renting Occupation and | ||||||
12 | Use Tax Act.
| ||||||
13 | (6) Personal property sold by a teacher-sponsored student | ||||||
14 | organization
affiliated with an elementary or secondary school | ||||||
15 | located in Illinois.
| ||||||
16 | (7) Until July 1, 2003, proceeds of that portion of the | ||||||
17 | selling price of
a passenger car the
sale of which is subject | ||||||
18 | to the Replacement Vehicle Tax.
| ||||||
19 | (8) Personal property sold to an Illinois county fair | ||||||
20 | association for
use in conducting, operating, or promoting the | ||||||
21 | county fair.
| ||||||
22 | (9) Personal property sold to a not-for-profit arts
or | ||||||
23 | cultural organization that establishes, by proof required by | ||||||
24 | the Department
by
rule, that it has received an exemption under | ||||||
25 | Section 501(c)(3) of the
Internal Revenue Code and that is | ||||||
26 | organized and operated primarily for the
presentation
or |
| |||||||
| |||||||
1 | support of arts or cultural programming, activities, or | ||||||
2 | services. These
organizations include, but are not limited to, | ||||||
3 | music and dramatic arts
organizations such as symphony | ||||||
4 | orchestras and theatrical groups, arts and
cultural service | ||||||
5 | organizations, local arts councils, visual arts organizations,
| ||||||
6 | and media arts organizations.
On and after the effective date | ||||||
7 | of this amendatory Act of the 92nd General
Assembly, however, | ||||||
8 | an entity otherwise eligible for this exemption shall not
make | ||||||
9 | tax-free purchases unless it has an active identification | ||||||
10 | number issued by
the Department.
| ||||||
11 | (10) Personal property sold by a corporation, society, | ||||||
12 | association,
foundation, institution, or organization, other | ||||||
13 | than a limited liability
company, that is organized and | ||||||
14 | operated as a not-for-profit service enterprise
for the benefit | ||||||
15 | of persons 65 years of age or older if the personal property
| ||||||
16 | was not purchased by the enterprise for the purpose of resale | ||||||
17 | by the
enterprise.
| ||||||
18 | (11) Personal property sold to a governmental body, to a | ||||||
19 | corporation,
society, association, foundation, or institution | ||||||
20 | organized and operated
exclusively for charitable, religious, | ||||||
21 | or educational purposes, or to a
not-for-profit corporation, | ||||||
22 | society, association, foundation, institution,
or organization | ||||||
23 | that has no compensated officers or employees and that is
| ||||||
24 | organized and operated primarily for the recreation of persons | ||||||
25 | 55 years of
age or older. A limited liability company may | ||||||
26 | qualify for the exemption under
this paragraph only if the |
| |||||||
| |||||||
1 | limited liability company is organized and operated
| ||||||
2 | exclusively for educational purposes. On and after July 1, | ||||||
3 | 1987, however, no
entity otherwise eligible for this exemption | ||||||
4 | shall make tax-free purchases
unless it has an active | ||||||
5 | identification number issued by the Department.
| ||||||
6 | (12) Tangible personal property sold to
interstate | ||||||
7 | carriers
for hire for use as
rolling stock moving in interstate | ||||||
8 | commerce or to lessors under leases of
one year or longer | ||||||
9 | executed or in effect at the time of purchase by
interstate | ||||||
10 | carriers for hire for use as rolling stock moving in interstate
| ||||||
11 | commerce and equipment operated by a telecommunications | ||||||
12 | provider, licensed as a
common carrier by the Federal | ||||||
13 | Communications Commission, which is permanently
installed in | ||||||
14 | or affixed to aircraft moving in interstate commerce.
| ||||||
15 | (12-5) On and after July 1, 2003 and through June 30, 2004, | ||||||
16 | motor vehicles of the second division
with a gross vehicle | ||||||
17 | weight in excess of 8,000 pounds
that
are
subject to the | ||||||
18 | commercial distribution fee imposed under Section 3-815.1 of
| ||||||
19 | the Illinois
Vehicle Code. Beginning on July 1, 2004 and | ||||||
20 | through June 30, 2005, the use in this State of motor vehicles | ||||||
21 | of the second division: (i) with a gross vehicle weight rating | ||||||
22 | in excess of 8,000 pounds; (ii) that are subject to the | ||||||
23 | commercial distribution fee imposed under Section 3-815.1 of | ||||||
24 | the Illinois Vehicle Code; and (iii) that are primarily used | ||||||
25 | for commercial purposes. Through June 30, 2005, this
exemption | ||||||
26 | applies to repair and replacement parts added
after the
initial |
| |||||||
| |||||||
1 | purchase of such a motor vehicle if that motor vehicle is used | ||||||
2 | in a
manner that
would qualify for the rolling stock exemption | ||||||
3 | otherwise provided for in this
Act. For purposes of this | ||||||
4 | paragraph, "used for commercial purposes" means the | ||||||
5 | transportation of persons or property in furtherance of any | ||||||
6 | commercial or industrial enterprise whether for-hire or not.
| ||||||
7 | (13) Proceeds from sales to owners, lessors, or
shippers of
| ||||||
8 | tangible personal property that is utilized by interstate | ||||||
9 | carriers for
hire for use as rolling stock moving in interstate | ||||||
10 | commerce
and equipment operated by a telecommunications | ||||||
11 | provider, licensed as a
common carrier by the Federal | ||||||
12 | Communications Commission, which is
permanently installed in | ||||||
13 | or affixed to aircraft moving in interstate commerce.
| ||||||
14 | (14) (Blank).
Machinery and equipment that will be used by | ||||||
15 | the purchaser, or a
lessee of the purchaser, primarily in the | ||||||
16 | process of manufacturing or
assembling tangible personal | ||||||
17 | property for wholesale or retail sale or
lease, whether the | ||||||
18 | sale or lease is made directly by the manufacturer or by
some | ||||||
19 | other person, whether the materials used in the process are | ||||||
20 | owned by
the manufacturer or some other person, or whether the | ||||||
21 | sale or lease is made
apart from or as an incident to the | ||||||
22 | seller's engaging in the service
occupation of producing | ||||||
23 | machines, tools, dies, jigs, patterns, gauges, or
other similar | ||||||
24 | items of no commercial value on special order for a particular
| ||||||
25 | purchaser.
| ||||||
26 | (15) Proceeds of mandatory service charges separately |
| |||||||
| |||||||
1 | stated on
customers' bills for purchase and consumption of food | ||||||
2 | and beverages, to the
extent that the proceeds of the service | ||||||
3 | charge are in fact turned over as
tips or as a substitute for | ||||||
4 | tips to the employees who participate directly
in preparing, | ||||||
5 | serving, hosting or cleaning up the food or beverage function
| ||||||
6 | with respect to which the service charge is imposed.
| ||||||
7 | (16) Petroleum products sold to a purchaser if the seller
| ||||||
8 | is prohibited by federal law from charging tax to the | ||||||
9 | purchaser.
| ||||||
10 | (17) Tangible personal property sold to a common carrier by | ||||||
11 | rail or
motor that
receives the physical possession of the | ||||||
12 | property in Illinois and that
transports the property, or | ||||||
13 | shares with another common carrier in the
transportation of the | ||||||
14 | property, out of Illinois on a standard uniform bill
of lading | ||||||
15 | showing the seller of the property as the shipper or consignor | ||||||
16 | of
the property to a destination outside Illinois, for use | ||||||
17 | outside Illinois.
| ||||||
18 | (18) Legal tender, currency, medallions, or gold or silver | ||||||
19 | coinage
issued by the State of Illinois, the government of the | ||||||
20 | United States of
America, or the government of any foreign | ||||||
21 | country, and bullion.
| ||||||
22 | (19) Until July 1 2003, oil field exploration, drilling, | ||||||
23 | and production
equipment, including
(i) rigs and parts of rigs, | ||||||
24 | rotary rigs, cable tool
rigs, and workover rigs, (ii) pipe and | ||||||
25 | tubular goods, including casing and
drill strings, (iii) pumps | ||||||
26 | and pump-jack units, (iv) storage tanks and flow
lines, (v) any |
| |||||||
| |||||||
1 | individual replacement part for oil field exploration,
| ||||||
2 | drilling, and production equipment, and (vi) machinery and | ||||||
3 | equipment purchased
for lease; but
excluding motor vehicles | ||||||
4 | required to be registered under the Illinois
Vehicle Code.
| ||||||
5 | (20) Photoprocessing machinery and equipment, including | ||||||
6 | repair and
replacement parts, both new and used, including that | ||||||
7 | manufactured on
special order, certified by the purchaser to be | ||||||
8 | used primarily for
photoprocessing, and including | ||||||
9 | photoprocessing machinery and equipment
purchased for lease.
| ||||||
10 | (21) Until July 1, 2003, coal exploration, mining, | ||||||
11 | offhighway hauling,
processing,
maintenance, and reclamation | ||||||
12 | equipment, including
replacement parts and equipment, and | ||||||
13 | including
equipment purchased for lease, but excluding motor | ||||||
14 | vehicles required to be
registered under the Illinois Vehicle | ||||||
15 | Code.
| ||||||
16 | (22) Fuel and petroleum products sold to or used by an air | ||||||
17 | carrier,
certified by the carrier to be used for consumption, | ||||||
18 | shipment, or storage
in the conduct of its business as an air | ||||||
19 | common carrier, for a flight
destined for or returning from a | ||||||
20 | location or locations
outside the United States without regard | ||||||
21 | to previous or subsequent domestic
stopovers.
| ||||||
22 | (23) A transaction in which the purchase order is received | ||||||
23 | by a florist
who is located outside Illinois, but who has a | ||||||
24 | florist located in Illinois
deliver the property to the | ||||||
25 | purchaser or the purchaser's donee in Illinois.
| ||||||
26 | (24) Fuel consumed or used in the operation of ships, |
| |||||||
| |||||||
1 | barges, or vessels
that are used primarily in or for the | ||||||
2 | transportation of property or the
conveyance of persons for | ||||||
3 | hire on rivers bordering on this State if the
fuel is delivered | ||||||
4 | by the seller to the purchaser's barge, ship, or vessel
while | ||||||
5 | it is afloat upon that bordering river.
| ||||||
6 | (25) Except as provided in item (25-5) of this Section, a
| ||||||
7 | motor vehicle sold in this State to a nonresident even though | ||||||
8 | the
motor vehicle is delivered to the nonresident in this | ||||||
9 | State, if the motor
vehicle is not to be titled in this State, | ||||||
10 | and if a drive-away permit
is issued to the motor vehicle as | ||||||
11 | provided in Section 3-603 of the Illinois
Vehicle Code or if | ||||||
12 | the nonresident purchaser has vehicle registration
plates to | ||||||
13 | transfer to the motor vehicle upon returning to his or her home
| ||||||
14 | state. The issuance of the drive-away permit or having
the
| ||||||
15 | out-of-state registration plates to be transferred is prima | ||||||
16 | facie evidence
that the motor vehicle will not be titled in | ||||||
17 | this State.
| ||||||
18 | (25-5) The exemption under item (25) does not apply if the | ||||||
19 | state in which the motor vehicle will be titled does not allow | ||||||
20 | a reciprocal exemption for a motor vehicle sold and delivered | ||||||
21 | in that state to an Illinois resident but titled in Illinois. | ||||||
22 | The tax collected under this Act on the sale of a motor vehicle | ||||||
23 | in this State to a resident of another state that does not | ||||||
24 | allow a reciprocal exemption shall be imposed at a rate equal | ||||||
25 | to the state's rate of tax on taxable property in the state in | ||||||
26 | which the purchaser is a resident, except that the tax shall |
| |||||||
| |||||||
1 | not exceed the tax that would otherwise be imposed under this | ||||||
2 | Act. At the time of the sale, the purchaser shall execute a | ||||||
3 | statement, signed under penalty of perjury, of his or her | ||||||
4 | intent to title the vehicle in the state in which the purchaser | ||||||
5 | is a resident within 30 days after the sale and of the fact of | ||||||
6 | the payment to the State of Illinois of tax in an amount | ||||||
7 | equivalent to the state's rate of tax on taxable property in | ||||||
8 | his or her state of residence and shall submit the statement to | ||||||
9 | the appropriate tax collection agency in his or her state of | ||||||
10 | residence. In addition, the retailer must retain a signed copy | ||||||
11 | of the statement in his or her records. Nothing in this item | ||||||
12 | shall be construed to require the removal of the vehicle from | ||||||
13 | this state following the filing of an intent to title the | ||||||
14 | vehicle in the purchaser's state of residence if the purchaser | ||||||
15 | titles the vehicle in his or her state of residence within 30 | ||||||
16 | days after the date of sale. The tax collected under this Act | ||||||
17 | in accordance with this item (25-5) shall be proportionately | ||||||
18 | distributed as if the tax were collected at the 6.25% general | ||||||
19 | rate imposed under this Act.
| ||||||
20 | (26) Semen used for artificial insemination of livestock | ||||||
21 | for direct
agricultural production.
| ||||||
22 | (27) Horses, or interests in horses, registered with and | ||||||
23 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
24 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
25 | Horse Association, United States
Trotting Association, or | ||||||
26 | Jockey Club, as appropriate, used for
purposes of breeding or |
| |||||||
| |||||||
1 | racing for prizes.
| ||||||
2 | (28) Computers and communications equipment utilized for | ||||||
3 | any
hospital
purpose
and equipment used in the diagnosis,
| ||||||
4 | analysis, or treatment of hospital patients sold to a lessor | ||||||
5 | who leases the
equipment, under a lease of one year or longer | ||||||
6 | executed or in effect at the
time of the purchase, to a
| ||||||
7 | hospital
that has been issued an active tax exemption | ||||||
8 | identification number by the
Department under Section 1g of | ||||||
9 | this Act.
| ||||||
10 | (29) Personal property sold to a lessor who leases the
| ||||||
11 | property, under a
lease of one year or longer executed or in | ||||||
12 | effect at the time of the purchase,
to a governmental body
that | ||||||
13 | has been issued an active tax exemption identification number | ||||||
14 | by the
Department under Section 1g of this Act.
| ||||||
15 | (30) Beginning with taxable years ending on or after | ||||||
16 | December
31, 1995
and
ending with taxable years ending on or | ||||||
17 | before December 31, 2004,
personal property that is
donated for | ||||||
18 | disaster relief to be used in a State or federally declared
| ||||||
19 | disaster area in Illinois or bordering Illinois by a | ||||||
20 | manufacturer or retailer
that is registered in this State to a | ||||||
21 | corporation, society, association,
foundation, or institution | ||||||
22 | that has been issued a sales tax exemption
identification | ||||||
23 | number by the Department that assists victims of the disaster
| ||||||
24 | who reside within the declared disaster area.
| ||||||
25 | (31) Beginning with taxable years ending on or after | ||||||
26 | December
31, 1995 and
ending with taxable years ending on or |
| |||||||
| |||||||
1 | before December 31, 2004, personal
property that is used in the | ||||||
2 | performance of infrastructure repairs in this
State, including | ||||||
3 | but not limited to municipal roads and streets, access roads,
| ||||||
4 | bridges, sidewalks, waste disposal systems, water and sewer | ||||||
5 | line extensions,
water distribution and purification | ||||||
6 | facilities, storm water drainage and
retention facilities, and | ||||||
7 | sewage treatment facilities, resulting from a State
or | ||||||
8 | federally declared disaster in Illinois or bordering Illinois | ||||||
9 | when such
repairs are initiated on facilities located in the | ||||||
10 | declared disaster area
within 6 months after the disaster.
| ||||||
11 | (32) Beginning July 1, 1999, game or game birds sold at a | ||||||
12 | "game breeding
and
hunting preserve area" or an "exotic game | ||||||
13 | hunting area" as those terms are used
in the
Wildlife Code or | ||||||
14 | at a hunting enclosure approved through rules adopted by the
| ||||||
15 | Department of Natural Resources. This paragraph is exempt from | ||||||
16 | the provisions
of
Section 2-70.
| ||||||
17 | (33) A motor vehicle, as that term is defined in Section | ||||||
18 | 1-146
of the
Illinois Vehicle Code, that is donated to a | ||||||
19 | corporation, limited liability
company, society, association, | ||||||
20 | foundation, or institution that is determined by
the Department | ||||||
21 | to be organized and operated exclusively for educational
| ||||||
22 | purposes. For purposes of this exemption, "a corporation, | ||||||
23 | limited liability
company, society, association, foundation, | ||||||
24 | or institution organized and
operated
exclusively for | ||||||
25 | educational purposes" means all tax-supported public schools,
| ||||||
26 | private schools that offer systematic instruction in useful |
| |||||||
| |||||||
1 | branches of
learning by methods common to public schools and | ||||||
2 | that compare favorably in
their scope and intensity with the | ||||||
3 | course of study presented in tax-supported
schools, and | ||||||
4 | vocational or technical schools or institutes organized and
| ||||||
5 | operated exclusively to provide a course of study of not less | ||||||
6 | than 6 weeks
duration and designed to prepare individuals to | ||||||
7 | follow a trade or to pursue a
manual, technical, mechanical, | ||||||
8 | industrial, business, or commercial
occupation.
| ||||||
9 | (34) Beginning January 1, 2000, personal property, | ||||||
10 | including food, purchased
through fundraising events for the | ||||||
11 | benefit of a public or private elementary or
secondary school, | ||||||
12 | a group of those schools, or one or more school districts if
| ||||||
13 | the events are sponsored by an entity recognized by the school | ||||||
14 | district that
consists primarily of volunteers and includes | ||||||
15 | parents and teachers of the
school children. This paragraph | ||||||
16 | does not apply to fundraising events (i) for
the benefit of | ||||||
17 | private home instruction or (ii) for which the fundraising
| ||||||
18 | entity purchases the personal property sold at the events from | ||||||
19 | another
individual or entity that sold the property for the | ||||||
20 | purpose of resale by the
fundraising entity and that profits | ||||||
21 | from the sale to the fundraising entity.
This paragraph is | ||||||
22 | exempt from the provisions of Section 2-70.
| ||||||
23 | (35) Beginning January 1, 2000 and through December 31, | ||||||
24 | 2001, new or used
automatic vending machines that prepare and | ||||||
25 | serve hot food and beverages,
including coffee, soup, and other | ||||||
26 | items, and replacement parts for these
machines. Beginning |
| |||||||
| |||||||
1 | January 1, 2002 and through June 30, 2003, machines
and parts | ||||||
2 | for machines used in
commercial, coin-operated amusement and | ||||||
3 | vending business if a use or occupation
tax is paid on the | ||||||
4 | gross receipts derived from the use of the commercial,
| ||||||
5 | coin-operated amusement and vending machines. This paragraph | ||||||
6 | is exempt from
the provisions of Section 2-70.
| ||||||
7 | (35-5) Beginning August 23, 2001 and through June 30, 2011, | ||||||
8 | food for human consumption that is to be consumed off
the | ||||||
9 | premises where it is sold (other than alcoholic beverages, soft | ||||||
10 | drinks,
and food that has been prepared for immediate | ||||||
11 | consumption) and prescription
and nonprescription medicines, | ||||||
12 | drugs, medical appliances, and insulin, urine
testing | ||||||
13 | materials, syringes, and needles used by diabetics, for human | ||||||
14 | use, when
purchased for use by a person receiving medical | ||||||
15 | assistance under Article 5 of
the Illinois Public Aid Code who | ||||||
16 | resides in a licensed long-term care facility,
as defined in | ||||||
17 | the Nursing Home Care Act.
| ||||||
18 | (36) Beginning August 2, 2001, computers and | ||||||
19 | communications equipment
utilized for any hospital purpose and | ||||||
20 | equipment used in the diagnosis,
analysis, or treatment of | ||||||
21 | hospital patients sold to a lessor who leases the
equipment, | ||||||
22 | under a lease of one year or longer executed or in effect at | ||||||
23 | the
time of the purchase, to a hospital that has been issued an | ||||||
24 | active tax
exemption identification number by the Department | ||||||
25 | under Section 1g of this Act.
This paragraph is exempt from the | ||||||
26 | provisions of Section 2-70.
|
| |||||||
| |||||||
1 | (37) Beginning August 2, 2001, personal property sold to a | ||||||
2 | lessor who
leases the property, under a lease of one year or | ||||||
3 | longer executed or in effect
at the time of the purchase, to a | ||||||
4 | governmental body that has been issued an
active tax exemption | ||||||
5 | identification number by the Department under Section 1g
of | ||||||
6 | this Act. This paragraph is exempt from the provisions of | ||||||
7 | Section 2-70.
| ||||||
8 | (38) Beginning on January 1, 2002 and through June 30, | ||||||
9 | 2011, tangible personal property purchased
from an Illinois | ||||||
10 | retailer by a taxpayer engaged in centralized purchasing
| ||||||
11 | activities in Illinois who will, upon receipt of the property | ||||||
12 | in Illinois,
temporarily store the property in Illinois (i) for | ||||||
13 | the purpose of subsequently
transporting it outside this State | ||||||
14 | for use or consumption thereafter solely
outside this State or | ||||||
15 | (ii) for the purpose of being processed, fabricated, or
| ||||||
16 | manufactured into, attached to, or incorporated into other | ||||||
17 | tangible personal
property to be transported outside this State | ||||||
18 | and thereafter used or consumed
solely outside this State. The | ||||||
19 | Director of Revenue shall, pursuant to rules
adopted in | ||||||
20 | accordance with the Illinois Administrative Procedure Act, | ||||||
21 | issue a
permit to any taxpayer in good standing with the | ||||||
22 | Department who is eligible for
the exemption under this | ||||||
23 | paragraph (38). The permit issued under
this paragraph (38) | ||||||
24 | shall authorize the holder, to the extent and
in the manner | ||||||
25 | specified in the rules adopted under this Act, to purchase
| ||||||
26 | tangible personal property from a retailer exempt from the |
| |||||||
| |||||||
1 | taxes imposed by
this Act. Taxpayers shall maintain all | ||||||
2 | necessary books and records to
substantiate the use and | ||||||
3 | consumption of all such tangible personal property
outside of | ||||||
4 | the State of Illinois.
| ||||||
5 | (Source: P.A. 93-23, eff. 6-20-03; 93-24, eff. 6-20-03; 93-840, | ||||||
6 | eff. 7-30-04; 93-1033, eff. 9-3-04; 93-1068, eff. 1-15-05; | ||||||
7 | 94-1002, eff. 7-3-06.)
| ||||||
8 | (35 ILCS 120/1d rep.) (from Ch. 120, par. 440d)
| ||||||
9 | (35 ILCS 120/1f rep.) (from Ch. 120, par. 440f)
| ||||||
10 | Section 33. The Retailers' Occupation Tax Act is amended by | ||||||
11 | repealing Sections 1d and 1f. | ||||||
12 | Section 35. The Property Tax Code is amended by changing | ||||||
13 | Sections 18-255, 20-15, and 21-30 and by adding Section 18-178 | ||||||
14 | as follows: | ||||||
15 | (35 ILCS 200/18-178 new) | ||||||
16 | Sec. 18-178. Education tax abatement. Beginning with taxes | ||||||
17 | levied for 2007 (payable in 2008), the county clerk must | ||||||
18 | determine the final extension for educational purposes for all | ||||||
19 | taxable property in a school district located in the county or | ||||||
20 | for the taxable property of that part of a school district | ||||||
21 | located in the county, taking into account the maximum rate, | ||||||
22 | levy, and extension authorized under the Property Tax Extension | ||||||
23 | Limitation Law, the Truth in Taxation Law, and any other |
| |||||||
| |||||||
1 | statute. The county clerk must then abate the extension for | ||||||
2 | educational purposes for each school district or part of a | ||||||
3 | school district in the county by the amount of the minimum | ||||||
4 | property tax relief grant and, if applicable, the supplemental | ||||||
5 | property tax relief grant, certified to the county clerk for | ||||||
6 | that school district or part of a school district by the | ||||||
7 | Department of Revenue under Section 6z-65 of the State Finance | ||||||
8 | Act. When the final extension for educational purposes has been | ||||||
9 | determined and abated, the county clerk must notify the | ||||||
10 | Department of Revenue.
The county clerk must determine the | ||||||
11 | prorated portion of the certified minimum and, if applicable, | ||||||
12 | supplemental property tax relief grants allocable to each | ||||||
13 | taxpayer in a given school district based on the tax rate for | ||||||
14 | educational purposes for that school district and the aggregate | ||||||
15 | relief granted to that school district. The extension amount | ||||||
16 | for educational purposes, as originally calculated before | ||||||
17 | abatement, is the official, final extension for educational | ||||||
18 | purposes and must be used for all other purposes, including | ||||||
19 | determining the maximum rate, levy, and extension authorized | ||||||
20 | under the Property Tax Extension Limitation Law, the Truth in | ||||||
21 | Taxation Law, and any other statute and the maximum amount of | ||||||
22 | tax anticipation warrants under Sections 17-16 and 34-23 of the | ||||||
23 | School Code.
| ||||||
24 | (35 ILCS 200/18-255)
| ||||||
25 | Sec. 18-255. Abstract of assessments and extensions. When |
| |||||||
| |||||||
1 | the collector's
books are completed, the county clerk shall | ||||||
2 | make a complete statement of the
assessment and extensions, in | ||||||
3 | conformity to the instructions of the Department.
The clerk | ||||||
4 | shall certify the statement to the Department. Beginning with | ||||||
5 | the 2007 levy year, the Department shall require the statement | ||||||
6 | to include a separate listing of the amount of any extension | ||||||
7 | that is abated under Section 18-178 of this Act.
| ||||||
8 | (Source: Laws 1943, vol. 1, p. 1136; P.A. 88-455.)
| ||||||
9 | (35 ILCS 200/20-15)
| ||||||
10 | Sec. 20-15. Information on bill or separate statement. The | ||||||
11 | amount of tax due and rates shown on the tax bill pursuant to | ||||||
12 | this Section shall be net of any abatement under Section | ||||||
13 | 18-178. There shall be
printed on each bill, or on a separate | ||||||
14 | slip which shall be mailed with the
bill:
| ||||||
15 | (a) a statement itemizing the rate at which taxes have | ||||||
16 | been extended for
each of the taxing districts in the | ||||||
17 | county in whose district the property is
located, and in | ||||||
18 | those counties utilizing
electronic data processing | ||||||
19 | equipment the dollar amount of tax due from the
person | ||||||
20 | assessed allocable to each of those taxing districts, | ||||||
21 | including a
separate statement of the dollar amount of tax | ||||||
22 | due which is allocable to a tax
levied under the Illinois | ||||||
23 | Local Library Act or to any other tax levied by a
| ||||||
24 | municipality or township for public library purposes,
| ||||||
25 | (b) a separate statement for each of the taxing |
| |||||||
| |||||||
1 | districts of the dollar
amount of tax due which is | ||||||
2 | allocable to a tax levied under the Illinois Pension
Code | ||||||
3 | or to any other tax levied by a municipality or township | ||||||
4 | for public
pension or retirement purposes,
| ||||||
5 | (c) the total tax rate,
| ||||||
6 | (d) the total amount of tax due, and
| ||||||
7 | (e) the amount by which the total tax and the tax | ||||||
8 | allocable to each taxing
district differs from the | ||||||
9 | taxpayer's last prior tax bill , and | ||||||
10 | (f) the amount of tax abated under Section 18-178 | ||||||
11 | labeled "Portion of your Education Related Property Taxes | ||||||
12 | paid by the State of Illinois" .
| ||||||
13 | The county treasurer shall ensure that only those taxing | ||||||
14 | districts in
which a parcel of property is located shall be | ||||||
15 | listed on the bill for that
property.
| ||||||
16 | In all counties the statement shall also provide:
| ||||||
17 | (1) the property index number or other suitable | ||||||
18 | description,
| ||||||
19 | (2) the assessment of the property,
| ||||||
20 | (3) the equalization factors imposed by the county and | ||||||
21 | by the Department,
and
| ||||||
22 | (4) the equalized assessment resulting from the | ||||||
23 | application of the
equalization factors to the basic | ||||||
24 | assessment.
| ||||||
25 | In all counties which do not classify property for purposes | ||||||
26 | of taxation, for
property on which a single family residence is |
| |||||||
| |||||||
1 | situated the statement shall
also include a statement to | ||||||
2 | reflect the fair cash value determined for the
property. In all | ||||||
3 | counties which classify property for purposes of taxation in
| ||||||
4 | accordance with Section 4 of Article IX of the Illinois | ||||||
5 | Constitution, for
parcels of residential property in the lowest | ||||||
6 | assessment classification the
statement shall also include a | ||||||
7 | statement to reflect the fair cash value
determined for the | ||||||
8 | property.
| ||||||
9 | In all counties, the statement shall include information | ||||||
10 | that certain
taxpayers may be eligible for the Senior Citizens | ||||||
11 | and Disabled Persons Property
Tax Relief and Pharmaceutical | ||||||
12 | Assistance Act and that applications are
available from the | ||||||
13 | Illinois Department of Revenue.
| ||||||
14 | In counties which use the estimated or accelerated billing | ||||||
15 | methods, these
statements shall only be provided with the final | ||||||
16 | installment of taxes due , except that the statement under item | ||||||
17 | (f) shall be included with both installments in those counties | ||||||
18 | under estimated or accelerated billing methods, the first | ||||||
19 | billing showing the amount deducted from the first installment, | ||||||
20 | and the final billing showing the total tax abated for the levy | ||||||
21 | year under Section 18-178 . The
provisions of this Section | ||||||
22 | create a mandatory statutory duty. They are not
merely | ||||||
23 | directory or discretionary. The failure or neglect of the | ||||||
24 | collector to
mail the bill, or the failure of the taxpayer to | ||||||
25 | receive the bill, shall not
affect the validity of any tax, or | ||||||
26 | the liability for the payment of any tax.
|
| |||||||
| |||||||
1 | (Source: P.A. 91-699, eff. 1-1-01.)
| ||||||
2 | (35 ILCS 200/21-30)
| ||||||
3 | Sec. 21-30. Accelerated billing. Except as provided in this | ||||||
4 | Section, Section 9-260, and Section 21-40, in
counties with
| ||||||
5 | 3,000,000 or more inhabitants, by January 31 annually, | ||||||
6 | estimated tax bills
setting out the first installment of | ||||||
7 | property taxes for the preceding year,
payable in that year, | ||||||
8 | shall be prepared and mailed. The first installment of
taxes on | ||||||
9 | the estimated tax bills shall be computed at 50% of the total | ||||||
10 | of each
tax bill before the abatement of taxes under Section | ||||||
11 | 18-178 for the preceding year , less an estimate of one-half of | ||||||
12 | the minimum school district property tax relief grant for the | ||||||
13 | current year determined based on information available .
If, | ||||||
14 | prior to the preparation of the estimated tax bills, a | ||||||
15 | certificate of
error has been either approved by a court on or | ||||||
16 | before November 30 of the
preceding year or certified pursuant | ||||||
17 | to Section 14-15 on or before November 30
of the preceding | ||||||
18 | year, then the first installment of taxes on the estimated tax
| ||||||
19 | bills shall be computed at 50% of the total taxes before the | ||||||
20 | abatement of taxes under Section 18-178 for the preceding year | ||||||
21 | as
corrected by the certificate of error , less an estimate of | ||||||
22 | one-half of the minimum school district property tax relief | ||||||
23 | grant for the current year determined based on information | ||||||
24 | available .
By June 30 annually, actual tax bills shall
be | ||||||
25 | prepared and mailed. These bills shall set out total taxes due |
| |||||||
| |||||||
1 | and the
amount of estimated taxes billed in the first | ||||||
2 | installment, and shall state
the balance of taxes due for that | ||||||
3 | year as represented by the sum derived
from subtracting the | ||||||
4 | amount of the first installment from the total taxes due
for | ||||||
5 | that year.
| ||||||
6 | The county board may provide by ordinance, in counties with | ||||||
7 | 3,000,000 or more
inhabitants, for taxes to be paid in 4 | ||||||
8 | installments. For the levy year for
which the ordinance is | ||||||
9 | first effective and each subsequent year, estimated tax
bills | ||||||
10 | setting out the first, second, and third installment of taxes | ||||||
11 | for the
preceding year, payable in that year, shall be prepared | ||||||
12 | and mailed not later
than the date specified by ordinance. Each | ||||||
13 | installment on estimated tax bills
shall be computed at 25% of | ||||||
14 | the total of each tax bill for the preceding year.
By the date | ||||||
15 | specified in the ordinance, actual tax bills shall be prepared | ||||||
16 | and
mailed. These bills shall set out total taxes due and the | ||||||
17 | amount of estimated
taxes billed in the first, second, and | ||||||
18 | third installments and shall state the
balance of taxes due for | ||||||
19 | that year as represented by the sum derived from
subtracting | ||||||
20 | the amount of the estimated installments from the total taxes | ||||||
21 | due
for that year.
| ||||||
22 | The county board of any county with less than 3,000,000 | ||||||
23 | inhabitants may, by
ordinance or resolution, adopt an | ||||||
24 | accelerated method of tax billing.
The county board may | ||||||
25 | subsequently rescind the ordinance or resolution and
revert to | ||||||
26 | the method otherwise provided for in this Code.
|
| |||||||
| |||||||
1 | (Source: P.A. 93-560, eff. 8-20-03; 94-312, eff. 7-25-05.)
| ||||||
2 | Section 40. The Motor Fuel Tax Law is amended by changing | ||||||
3 | Section 2b as follows:
| ||||||
4 | (35 ILCS 505/2b) (from Ch. 120, par. 418b)
| ||||||
5 | Sec. 2b. In addition to the tax collection and reporting | ||||||
6 | responsibilities
imposed elsewhere in this Act, a person who is | ||||||
7 | required to pay the tax imposed
by Section 2a of this Act shall | ||||||
8 | pay the tax to the Department by return showing
all fuel | ||||||
9 | purchased, acquired or received and sold, distributed or used | ||||||
10 | during
the preceding calendar month
including losses of fuel as | ||||||
11 | the result of evaporation or shrinkage due to
temperature | ||||||
12 | variations, and such other reasonable information as the
| ||||||
13 | Department may require.
Losses of fuel as the result of | ||||||
14 | evaporation or shrinkage due to temperature
variations may not | ||||||
15 | exceed 1% of the total gallons in
storage at the
beginning of | ||||||
16 | the month, plus the receipts of gallonage during the month, | ||||||
17 | minus
the gallonage remaining in storage at the end of the | ||||||
18 | month. Any loss reported
that is in excess of this amount shall | ||||||
19 | be subject to the tax imposed by
Section
2a of this Law.
On and | ||||||
20 | after July 1, 2001, for each 6-month period January through | ||||||
21 | June, net
losses of fuel (for each category of fuel that is | ||||||
22 | required to be reported on a
return) as the result of | ||||||
23 | evaporation or shrinkage due to temperature variations
may not | ||||||
24 | exceed 1% of the total gallons in storage at the beginning of |
| |||||||
| |||||||
1 | each
January, plus the receipts of gallonage each January | ||||||
2 | through June, minus the
gallonage remaining in storage at the | ||||||
3 | end of each June. On and after July 1,
2001, for each 6-month | ||||||
4 | period July through December, net losses of fuel (for
each | ||||||
5 | category of fuel that is required to be reported on a return) | ||||||
6 | as the
result of evaporation or shrinkage due to temperature | ||||||
7 | variations may not exceed
1% of the total gallons in storage at | ||||||
8 | the beginning of each July, plus the
receipts of gallonage each | ||||||
9 | July through December, minus the gallonage remaining
in storage | ||||||
10 | at the end of each December. Any net loss reported that is in
| ||||||
11 | excess of this amount shall be subject to the tax imposed by | ||||||
12 | Section 2a of this
Law. For purposes of this Section, "net | ||||||
13 | loss" means the number of gallons
gained through temperature | ||||||
14 | variations minus the number of gallons lost through
temperature | ||||||
15 | variations or evaporation for each of the respective 6-month
| ||||||
16 | periods.
| ||||||
17 | The return shall be prescribed by the Department and shall | ||||||
18 | be filed
between the 1st and 20th days of each calendar month. | ||||||
19 | The Department may, in
its discretion, combine the returns | ||||||
20 | filed under this Section, Section 5, and
Section 5a of this | ||||||
21 | Act. The return must be accompanied by appropriate
| ||||||
22 | computer-generated magnetic media supporting schedule data in | ||||||
23 | the format
required by the Department, unless, as provided by | ||||||
24 | rule, the Department grants
an exception upon petition of a | ||||||
25 | taxpayer. If the return is filed timely, the
seller shall take | ||||||
26 | a discount of 2% through June 30, 2003 and 1.75%
thereafter |
| |||||||
| |||||||
1 | which is allowed to reimburse
the seller for
the expenses | ||||||
2 | incurred in keeping records, preparing and filing returns,
| ||||||
3 | collecting and remitting the tax and supplying data to the | ||||||
4 | Department on
request.
The discount, however, shall be | ||||||
5 | applicable only to the amount
of payment
which accompanies a | ||||||
6 | return that is filed timely in accordance with this
Section.
| ||||||
7 | (Source: P.A. 92-30, eff. 7-1-01; 93-32, eff. 6-20-03.)
| ||||||
8 | Section 45. The School Code is amended by changing Section | ||||||
9 | 18-8.05 and by adding Sections 18-8.15 and 18-25 as follows:
| ||||||
10 | (105 ILCS 5/18-8.05)
| ||||||
11 | Sec. 18-8.05. Basis for apportionment of general State | ||||||
12 | financial aid and
supplemental general State aid to the common | ||||||
13 | schools for the 1998-1999 and
subsequent school years.
| ||||||
14 | (A) General Provisions.
| ||||||
15 | (1) The provisions of this Section apply to the 1998-1999 | ||||||
16 | and subsequent
school years. The system of general State | ||||||
17 | financial aid provided for in this
Section
is designed to | ||||||
18 | assure that, through a combination of State financial aid and
| ||||||
19 | required local resources, the financial support provided each | ||||||
20 | pupil in Average
Daily Attendance equals or exceeds a
| ||||||
21 | prescribed per pupil Foundation Level. This formula approach | ||||||
22 | imputes a level
of per pupil Available Local Resources and | ||||||
23 | provides for the basis to calculate
a per pupil level of |
| |||||||
| |||||||
1 | general State financial aid that, when added to Available
Local | ||||||
2 | Resources, equals or exceeds the Foundation Level. The
amount | ||||||
3 | of per pupil general State financial aid for school districts, | ||||||
4 | in
general, varies in inverse
relation to Available Local | ||||||
5 | Resources. Per pupil amounts are based upon
each school | ||||||
6 | district's Average Daily Attendance as that term is defined in | ||||||
7 | this
Section.
| ||||||
8 | (2) In addition to general State financial aid, school | ||||||
9 | districts with
specified levels or concentrations of pupils | ||||||
10 | from low income households are
eligible to receive supplemental | ||||||
11 | general State financial aid grants as provided
pursuant to | ||||||
12 | subsection (H).
The supplemental State aid grants provided for | ||||||
13 | school districts under
subsection (H) shall be appropriated for | ||||||
14 | distribution to school districts as
part of the same line item | ||||||
15 | in which the general State financial aid of school
districts is | ||||||
16 | appropriated under this Section.
| ||||||
17 | (3) To receive financial assistance under this Section, | ||||||
18 | school districts
are required to file claims with the State | ||||||
19 | Board of Education, subject to the
following requirements:
| ||||||
20 | (a) Any school district which fails for any given | ||||||
21 | school year to maintain
school as required by law, or to | ||||||
22 | maintain a recognized school is not
eligible to file for | ||||||
23 | such school year any claim upon the Common School
Fund. In | ||||||
24 | case of nonrecognition of one or more attendance centers in | ||||||
25 | a
school district otherwise operating recognized schools, | ||||||
26 | the claim of the
district shall be reduced in the |
| |||||||
| |||||||
1 | proportion which the Average Daily
Attendance in the | ||||||
2 | attendance center or centers bear to the Average Daily
| ||||||
3 | Attendance in the school district. A "recognized school" | ||||||
4 | means any
public school which meets the standards as | ||||||
5 | established for recognition
by the State Board of | ||||||
6 | Education. A school district or attendance center
not | ||||||
7 | having recognition status at the end of a school term is | ||||||
8 | entitled to
receive State aid payments due upon a legal | ||||||
9 | claim which was filed while
it was recognized.
| ||||||
10 | (b) School district claims filed under this Section are | ||||||
11 | subject to
Sections 18-9, 18-10, and 18-12, except as | ||||||
12 | otherwise provided in this
Section.
| ||||||
13 | (c) If a school district operates a full year school | ||||||
14 | under Section
10-19.1, the general State aid to the school | ||||||
15 | district shall be determined
by the State Board of | ||||||
16 | Education in accordance with this Section as near as
may be | ||||||
17 | applicable.
| ||||||
18 | (c-5) "ECI" means the Employment Cost Index as | ||||||
19 | published by the U.S. Bureau of Labor Statistics.
| ||||||
20 | (d) (Blank).
| ||||||
21 | (4) Except as provided in subsections (H) and (L), the | ||||||
22 | board of any district
receiving any of the grants provided for | ||||||
23 | in this Section may apply those funds
to any fund so received | ||||||
24 | for which that board is authorized to make expenditures
by law.
| ||||||
25 | School districts are not required to exert a minimum | ||||||
26 | Operating Tax Rate in
order to qualify for assistance under |
| |||||||
| |||||||
1 | this Section.
| ||||||
2 | (5) As used in this Section the following terms, when | ||||||
3 | capitalized, shall
have the meaning ascribed herein:
| ||||||
4 | (a) "Average Daily Attendance": A count of pupil | ||||||
5 | attendance in school,
averaged as provided for in | ||||||
6 | subsection (C) and utilized in deriving per pupil
financial | ||||||
7 | support levels.
| ||||||
8 | (b) "Available Local Resources": A computation of | ||||||
9 | local financial
support, calculated on the basis of Average | ||||||
10 | Daily Attendance and derived as
provided pursuant to | ||||||
11 | subsection (D).
| ||||||
12 | (c) "Corporate Personal Property Replacement Taxes": | ||||||
13 | Funds paid to local
school districts pursuant to "An Act in | ||||||
14 | relation to the abolition of ad valorem
personal property | ||||||
15 | tax and the replacement of revenues lost thereby, and
| ||||||
16 | amending and repealing certain Acts and parts of Acts in | ||||||
17 | connection therewith",
certified August 14, 1979, as | ||||||
18 | amended (Public Act 81-1st S.S.-1).
| ||||||
19 | (d) "Foundation Level": A prescribed level of per pupil | ||||||
20 | financial support
as provided for in subsection (B).
| ||||||
21 | (e) "Operating Tax Rate": All school district property | ||||||
22 | taxes extended for
all purposes, except Bond and
Interest, | ||||||
23 | Summer School, Rent, Capital Improvement, and Vocational | ||||||
24 | Education
Building purposes.
| ||||||
25 | (B) Foundation Level.
|
| |||||||
| |||||||
1 | (1) The Foundation Level is a figure established by the | ||||||
2 | State representing
the minimum level of per pupil financial | ||||||
3 | support that should be available to
provide for the basic | ||||||
4 | education of each pupil in
Average Daily Attendance. As set | ||||||
5 | forth in this Section, each school district
is assumed to exert
| ||||||
6 | a sufficient local taxing effort such that, in combination with | ||||||
7 | the aggregate
of general State
financial aid provided the | ||||||
8 | district, an aggregate of State and local resources
are | ||||||
9 | available to meet
the basic education needs of pupils in the | ||||||
10 | district.
| ||||||
11 | (2) For the 1998-1999 school year, the Foundation Level of | ||||||
12 | support is
$4,225. For the 1999-2000 school year, the | ||||||
13 | Foundation Level of support is
$4,325. For the 2000-2001 school | ||||||
14 | year, the Foundation Level of support is
$4,425. For the | ||||||
15 | 2001-2002 school year and 2002-2003 school year, the
Foundation | ||||||
16 | Level of support is $4,560. For the 2003-2004 school year, the | ||||||
17 | Foundation Level of support is $4,810. For the 2004-2005 school | ||||||
18 | year, the Foundation Level of support is $4,964.
For the | ||||||
19 | 2005-2006 school year,
the Foundation Level of support is | ||||||
20 | $5,164.
| ||||||
21 | (3) For the 2006-2007 school year and each school year | ||||||
22 | thereafter,
the Foundation Level of support is $5,334 or such | ||||||
23 | greater amount as
may be established by law by the General | ||||||
24 | Assembly.
| ||||||
25 | (4) For the 2007-2008 school year, the Foundation Level of | ||||||
26 | support is $5,952. For each school year thereafter, the |
| |||||||
| |||||||
1 | Foundation Level of support shall be equal to the Foundation | ||||||
2 | Level of support for the immediately preceding school year, | ||||||
3 | increased by the percentage increase, if any, in the ECI | ||||||
4 | published for the immediately preceding school year, or such | ||||||
5 | greater amount as may be established by law by the General | ||||||
6 | Assembly.
| ||||||
7 | (C) Average Daily Attendance.
| ||||||
8 | (1) For purposes of calculating general State aid pursuant | ||||||
9 | to subsection
(E), an Average Daily Attendance figure shall be | ||||||
10 | utilized. The Average Daily
Attendance figure for formula
| ||||||
11 | calculation purposes shall be the monthly average of the actual | ||||||
12 | number of
pupils in attendance of
each school district, as | ||||||
13 | further averaged for the best 3 months of pupil
attendance for | ||||||
14 | each
school district. In compiling the figures for the number | ||||||
15 | of pupils in
attendance, school districts
and the State Board | ||||||
16 | of Education shall, for purposes of general State aid
funding, | ||||||
17 | conform
attendance figures to the requirements of subsection | ||||||
18 | (F).
| ||||||
19 | (2) The Average Daily Attendance figures utilized in | ||||||
20 | subsection (E) shall be
the requisite attendance data for the | ||||||
21 | school year immediately preceding
the
school year for which | ||||||
22 | general State aid is being calculated
or the average of the | ||||||
23 | attendance data for the 3 preceding school
years, whichever is | ||||||
24 | greater. The Average Daily Attendance figures
utilized in | ||||||
25 | subsection (H) shall be the requisite attendance data for the
|
| |||||||
| |||||||
1 | school year immediately preceding the school year for which | ||||||
2 | general
State aid is being calculated.
| ||||||
3 | (D) Available Local Resources.
| ||||||
4 | (1) For purposes of calculating general State aid pursuant | ||||||
5 | to subsection
(E), a representation of Available Local | ||||||
6 | Resources per pupil, as that term is
defined and determined in | ||||||
7 | this subsection, shall be utilized. Available Local
Resources | ||||||
8 | per pupil shall include a calculated
dollar amount representing | ||||||
9 | local school district revenues from local property
taxes and | ||||||
10 | from
Corporate Personal Property Replacement Taxes, expressed | ||||||
11 | on the basis of pupils
in Average
Daily Attendance. Calculation | ||||||
12 | of Available Local Resources shall exclude any tax amnesty | ||||||
13 | funds received as a result of Public Act 93-26.
| ||||||
14 | (2) In determining a school district's revenue from local | ||||||
15 | property taxes,
the State Board of Education shall utilize the | ||||||
16 | equalized assessed valuation of
all taxable property of each | ||||||
17 | school
district as of September 30 of the previous year. The | ||||||
18 | equalized assessed
valuation utilized shall
be obtained and | ||||||
19 | determined as provided in subsection (G).
| ||||||
20 | (3) For school districts maintaining grades kindergarten | ||||||
21 | through 12, local
property tax
revenues per pupil shall be | ||||||
22 | calculated as the product of the applicable
equalized assessed
| ||||||
23 | valuation for the district multiplied by 3.00%, and divided by | ||||||
24 | the district's
Average Daily
Attendance figure. For school | ||||||
25 | districts maintaining grades kindergarten
through 8, local
|
| |||||||
| |||||||
1 | property tax revenues per pupil shall be calculated as the | ||||||
2 | product of the
applicable equalized
assessed valuation for the | ||||||
3 | district multiplied by 2.30%, and divided by the
district's | ||||||
4 | Average
Daily Attendance figure. For school districts | ||||||
5 | maintaining grades 9 through 12,
local property
tax revenues | ||||||
6 | per pupil shall be the applicable equalized assessed valuation | ||||||
7 | of
the district
multiplied by 1.05%, and divided by the | ||||||
8 | district's Average Daily
Attendance
figure.
| ||||||
9 | For partial elementary unit districts created pursuant to | ||||||
10 | Article 11E of this Code, local property tax revenues per pupil | ||||||
11 | shall be calculated as the product of the equalized assessed | ||||||
12 | valuation for property within the elementary and high school | ||||||
13 | classification of the partial elementary unit district | ||||||
14 | multiplied by 2.06% and divided by the Average Daily Attendance | ||||||
15 | figure for grades kindergarten through 8, plus the product of | ||||||
16 | the equalized assessed valuation for property within the high | ||||||
17 | school only classification of the partial elementary unit | ||||||
18 | district multiplied by 0.94% and divided by the Average Daily | ||||||
19 | Attendance figure for grades 9 through 12.
| ||||||
20 | (4) The Corporate Personal Property Replacement Taxes paid | ||||||
21 | to each school
district during the calendar year 2 years before | ||||||
22 | the calendar year in which a
school year begins, divided by the | ||||||
23 | Average Daily Attendance figure for that
district, shall be | ||||||
24 | added to the local property tax revenues per pupil as
derived | ||||||
25 | by the application of the immediately preceding paragraph (3). | ||||||
26 | The sum
of these per pupil figures for each school district |
| |||||||
| |||||||
1 | shall constitute Available
Local Resources as that term is | ||||||
2 | utilized in subsection (E) in the calculation
of general State | ||||||
3 | aid.
| ||||||
4 | (E) Computation of General State Aid.
| ||||||
5 | (1) For each school year, the amount of general State aid | ||||||
6 | allotted to a
school district shall be computed by the State | ||||||
7 | Board of Education as provided
in this subsection.
| ||||||
8 | (2) For any school district for which Available Local | ||||||
9 | Resources per pupil
is less than the product of 0.93 times the | ||||||
10 | Foundation Level, general State aid
for that district shall be | ||||||
11 | calculated as an amount equal to the Foundation
Level minus | ||||||
12 | Available Local Resources, multiplied by the Average Daily
| ||||||
13 | Attendance of the school district.
| ||||||
14 | (3) For any school district for which Available Local | ||||||
15 | Resources per pupil
is equal to or greater than the product of | ||||||
16 | 0.93 times the Foundation Level and
less than the product of | ||||||
17 | 1.75 times the Foundation Level, the general State aid
per | ||||||
18 | pupil shall be a decimal proportion of the Foundation Level | ||||||
19 | derived using a
linear algorithm. Under this linear algorithm, | ||||||
20 | the calculated general State
aid per pupil shall decline in | ||||||
21 | direct linear fashion from 0.07 times the
Foundation Level for | ||||||
22 | a school district with Available Local Resources equal to
the | ||||||
23 | product of 0.93 times the Foundation Level, to 0.05 times the | ||||||
24 | Foundation
Level for a school district with Available Local | ||||||
25 | Resources equal to the product
of 1.75 times the Foundation |
| |||||||
| |||||||
1 | Level. The allocation of general
State aid for school districts | ||||||
2 | subject to this paragraph 3 shall be the
calculated general | ||||||
3 | State aid
per pupil figure multiplied by the Average Daily | ||||||
4 | Attendance of the school
district.
| ||||||
5 | (4) For any school district for which Available Local | ||||||
6 | Resources per pupil
equals or exceeds the product of 1.75 times | ||||||
7 | the Foundation Level, the general
State aid for the school | ||||||
8 | district shall be calculated as the product of $218
multiplied | ||||||
9 | by the Average Daily Attendance of the school
district.
| ||||||
10 | (5) The amount of general State aid allocated to a school | ||||||
11 | district for
the 1999-2000 school year meeting the requirements | ||||||
12 | set forth in paragraph (4)
of subsection
(G) shall be increased | ||||||
13 | by an amount equal to the general State aid that
would have | ||||||
14 | been received by the district for the 1998-1999 school year by
| ||||||
15 | utilizing the Extension Limitation Equalized Assessed | ||||||
16 | Valuation as calculated
in paragraph (4) of subsection (G) less | ||||||
17 | the general State aid allotted for the
1998-1999
school year. | ||||||
18 | This amount shall be deemed a one time increase, and shall not
| ||||||
19 | affect any future general State aid allocations.
| ||||||
20 | (F) Compilation of Average Daily Attendance.
| ||||||
21 | (1) Each school district shall, by July 1 of each year, | ||||||
22 | submit to the State
Board of Education, on forms prescribed by | ||||||
23 | the State Board of Education,
attendance figures for the school | ||||||
24 | year that began in the preceding calendar
year. The attendance | ||||||
25 | information so transmitted shall identify the average
daily |
| |||||||
| |||||||
1 | attendance figures for each month of the school year. Beginning | ||||||
2 | with
the general State aid claim form for the 2002-2003 school
| ||||||
3 | year, districts shall calculate Average Daily Attendance as | ||||||
4 | provided in
subdivisions (a), (b), and (c) of this paragraph | ||||||
5 | (1).
| ||||||
6 | (a) In districts that do not hold year-round classes,
| ||||||
7 | days of attendance in August shall be added to the month of | ||||||
8 | September and any
days of attendance in June shall be added | ||||||
9 | to the month of May.
| ||||||
10 | (b) In districts in which all buildings hold year-round | ||||||
11 | classes,
days of attendance in July and August shall be | ||||||
12 | added to the month
of September and any days of attendance | ||||||
13 | in June shall be added to
the month of May.
| ||||||
14 | (c) In districts in which some buildings, but not all, | ||||||
15 | hold
year-round classes, for the non-year-round buildings, | ||||||
16 | days of
attendance in August shall be added to the month of | ||||||
17 | September
and any days of attendance in June shall be added | ||||||
18 | to the month of
May. The average daily attendance for the | ||||||
19 | year-round buildings
shall be computed as provided in | ||||||
20 | subdivision (b) of this paragraph
(1). To calculate the | ||||||
21 | Average Daily Attendance for the district, the
average | ||||||
22 | daily attendance for the year-round buildings shall be
| ||||||
23 | multiplied by the days in session for the non-year-round | ||||||
24 | buildings
for each month and added to the monthly | ||||||
25 | attendance of the
non-year-round buildings.
| ||||||
26 | Except as otherwise provided in this Section, days of
|
| |||||||
| |||||||
1 | attendance by pupils shall be counted only for sessions of not | ||||||
2 | less than
5 clock hours of school work per day under direct | ||||||
3 | supervision of: (i)
teachers, or (ii) non-teaching personnel or | ||||||
4 | volunteer personnel when engaging
in non-teaching duties and | ||||||
5 | supervising in those instances specified in
subsection (a) of | ||||||
6 | Section 10-22.34 and paragraph 10 of Section 34-18, with
pupils | ||||||
7 | of legal school age and in kindergarten and grades 1 through | ||||||
8 | 12.
| ||||||
9 | Days of attendance by tuition pupils shall be accredited | ||||||
10 | only to the
districts that pay the tuition to a recognized | ||||||
11 | school.
| ||||||
12 | (2) Days of attendance by pupils of less than 5 clock hours | ||||||
13 | of school
shall be subject to the following provisions in the | ||||||
14 | compilation of Average
Daily Attendance.
| ||||||
15 | (a) Pupils regularly enrolled in a public school for | ||||||
16 | only a part of
the school day may be counted on the basis | ||||||
17 | of 1/6 day for every class hour
of instruction of 40 | ||||||
18 | minutes or more attended pursuant to such enrollment,
| ||||||
19 | unless a pupil is
enrolled in a block-schedule format of 80 | ||||||
20 | minutes or more of instruction,
in which case the pupil may | ||||||
21 | be counted on the basis of the proportion of
minutes of | ||||||
22 | school work completed each day to the minimum number of
| ||||||
23 | minutes that school work is required to be held that day.
| ||||||
24 | (b) Days of attendance may be less than 5 clock hours | ||||||
25 | on the opening
and closing of the school term, and upon the | ||||||
26 | first day of pupil
attendance, if preceded by a day or days |
| |||||||
| |||||||
1 | utilized as an institute or
teachers' workshop.
| ||||||
2 | (c) A session of 4 or more clock hours may be counted | ||||||
3 | as a day of
attendance upon certification by the regional | ||||||
4 | superintendent, and
approved by the State Superintendent | ||||||
5 | of Education to the extent that the
district has been | ||||||
6 | forced to use daily multiple sessions.
| ||||||
7 | (d) A session of 3 or more clock hours may be counted | ||||||
8 | as a day of
attendance (1) when the remainder of the school | ||||||
9 | day or at least
2 hours in the evening of that day is | ||||||
10 | utilized for an
in-service training program for teachers, | ||||||
11 | up to a maximum of 5 days per
school year of which a | ||||||
12 | maximum of 4 days of such 5 days may be used for
| ||||||
13 | parent-teacher conferences, provided a district conducts | ||||||
14 | an in-service
training program for teachers which has been | ||||||
15 | approved by the State
Superintendent of Education; or, in | ||||||
16 | lieu of 4 such days, 2 full days may
be used, in which | ||||||
17 | event each such day
may be counted as a day of attendance; | ||||||
18 | and (2) when days in
addition to
those provided in item (1) | ||||||
19 | are scheduled by a school pursuant to its school
| ||||||
20 | improvement plan adopted under Article 34 or its revised or | ||||||
21 | amended school
improvement plan adopted under Article 2, | ||||||
22 | provided that (i) such sessions of
3 or more clock hours | ||||||
23 | are scheduled to occur at regular intervals, (ii) the
| ||||||
24 | remainder of the school days in which such sessions occur | ||||||
25 | are utilized
for in-service training programs or other | ||||||
26 | staff development activities for
teachers, and (iii) a |
| |||||||
| |||||||
1 | sufficient number of minutes of school work under the
| ||||||
2 | direct supervision of teachers are added to the school days | ||||||
3 | between such
regularly scheduled sessions to accumulate | ||||||
4 | not less than the number of minutes
by which such sessions | ||||||
5 | of 3 or more clock hours fall short of 5 clock hours.
Any | ||||||
6 | full days used for the purposes of this paragraph shall not | ||||||
7 | be considered
for
computing average daily attendance. Days | ||||||
8 | scheduled for in-service training
programs, staff | ||||||
9 | development activities, or parent-teacher conferences may | ||||||
10 | be
scheduled separately for different
grade levels and | ||||||
11 | different attendance centers of the district.
| ||||||
12 | (e) A session of not less than one clock hour of | ||||||
13 | teaching
hospitalized or homebound pupils on-site or by | ||||||
14 | telephone to the classroom may
be counted as 1/2 day of | ||||||
15 | attendance, however these pupils must receive 4 or
more | ||||||
16 | clock hours of instruction to be counted for a full day of | ||||||
17 | attendance.
| ||||||
18 | (f) A session of at least 4 clock hours may be counted | ||||||
19 | as a day of
attendance for first grade pupils, and pupils | ||||||
20 | in full day kindergartens,
and a session of 2 or more hours | ||||||
21 | may be counted as 1/2 day of attendance by
pupils in | ||||||
22 | kindergartens which provide only 1/2 day of attendance.
| ||||||
23 | (g) For children with disabilities who are below the | ||||||
24 | age of 6 years and
who
cannot attend 2 or more clock hours | ||||||
25 | because of their disability or
immaturity, a session of not | ||||||
26 | less than one clock hour may be counted as 1/2 day
of |
| |||||||
| |||||||
1 | attendance; however for such children whose educational | ||||||
2 | needs so require
a session of 4 or more clock hours may be | ||||||
3 | counted as a full day of attendance.
| ||||||
4 | (h) A recognized kindergarten which provides for only | ||||||
5 | 1/2 day of
attendance by each pupil shall not have more | ||||||
6 | than 1/2 day of attendance
counted in any one day. However, | ||||||
7 | kindergartens may count 2 1/2 days
of
attendance in any 5 | ||||||
8 | consecutive school days. When a pupil attends such a
| ||||||
9 | kindergarten for 2 half days on any one school day, the | ||||||
10 | pupil shall have
the following day as a day absent from | ||||||
11 | school, unless the school district
obtains permission in | ||||||
12 | writing from the State Superintendent of Education.
| ||||||
13 | Attendance at kindergartens which provide for a full day of | ||||||
14 | attendance by
each pupil shall be counted the same as | ||||||
15 | attendance by first grade pupils.
Only the first year of | ||||||
16 | attendance in one kindergarten shall be counted,
except in | ||||||
17 | case of children who entered the kindergarten in their | ||||||
18 | fifth year
whose educational development requires a second | ||||||
19 | year of kindergarten as
determined under the rules and | ||||||
20 | regulations of the State Board of Education.
| ||||||
21 | (i) On the days when the Prairie State Achievement | ||||||
22 | Examination is
administered under subsection (c) of | ||||||
23 | Section 2-3.64 of this Code, the day
of attendance for a | ||||||
24 | pupil whose school
day must be shortened to accommodate | ||||||
25 | required testing procedures may
be less than 5 clock hours | ||||||
26 | and shall be counted towards the 176 days of actual pupil |
| |||||||
| |||||||
1 | attendance required under Section 10-19 of this Code, | ||||||
2 | provided that a sufficient number of minutes
of school work | ||||||
3 | in excess of 5 clock hours are first completed on other | ||||||
4 | school
days to compensate for the loss of school work on | ||||||
5 | the examination days.
| ||||||
6 | (G) Equalized Assessed Valuation Data.
| ||||||
7 | (1) For purposes of the calculation of Available Local | ||||||
8 | Resources required
pursuant to subsection (D), the
State Board | ||||||
9 | of Education shall secure from the Department of
Revenue the | ||||||
10 | value as equalized or assessed by the Department of Revenue of
| ||||||
11 | all taxable property of every school district, together with | ||||||
12 | (i) the applicable
tax rate used in extending taxes for the | ||||||
13 | funds of the district as of
September 30 of the previous year
| ||||||
14 | and (ii) the limiting rate for all school
districts subject to | ||||||
15 | property tax extension limitations as imposed under the
| ||||||
16 | Property Tax Extension Limitation Law.
| ||||||
17 | The Department of Revenue shall add to the equalized | ||||||
18 | assessed value of all
taxable
property of each school district | ||||||
19 | situated entirely or partially within a county
that is or was | ||||||
20 | subject to the alternative general homestead exemption | ||||||
21 | provisions of Section 15-176 of the Property Tax Code (a)
an | ||||||
22 | amount equal to the total amount by which the
homestead | ||||||
23 | exemption allowed under Section 15-176 of the Property Tax Code | ||||||
24 | for
real
property situated in that school district exceeds the | ||||||
25 | total amount that would
have been
allowed in that school |
| |||||||
| |||||||
1 | district if the maximum reduction under Section 15-176
was
(i) | ||||||
2 | $4,500 in Cook County or $3,500 in all other counties in tax | ||||||
3 | year 2003 or (ii) $5,000 in all counties in tax year 2004 and | ||||||
4 | thereafter and (b) an amount equal to the aggregate amount for | ||||||
5 | the taxable year of all additional exemptions under Section | ||||||
6 | 15-175 of the Property Tax Code for owners with a household | ||||||
7 | income of $30,000 or less. The county clerk of any county that | ||||||
8 | is or was subject to the alternative general homestead | ||||||
9 | exemption provisions of Section 15-176 of the Property Tax Code | ||||||
10 | shall
annually calculate and certify to the Department of | ||||||
11 | Revenue for each school
district all
homestead exemption | ||||||
12 | amounts under Section 15-176 of the Property Tax Code and all | ||||||
13 | amounts of additional exemptions under Section 15-175 of the | ||||||
14 | Property Tax Code for owners with a household income of $30,000 | ||||||
15 | or less. It is the intent of this paragraph that if the general | ||||||
16 | homestead exemption for a parcel of property is determined | ||||||
17 | under Section 15-176 of the Property Tax Code rather than | ||||||
18 | Section 15-175, then the calculation of Available Local | ||||||
19 | Resources shall not be affected by the difference, if any, | ||||||
20 | between the amount of the general homestead exemption allowed | ||||||
21 | for that parcel of property under Section 15-176 of the | ||||||
22 | Property Tax Code and the amount that would have been allowed | ||||||
23 | had the general homestead exemption for that parcel of property | ||||||
24 | been determined under Section 15-175 of the Property Tax Code. | ||||||
25 | It is further the intent of this paragraph that if additional | ||||||
26 | exemptions are allowed under Section 15-175 of the Property Tax |
| |||||||
| |||||||
1 | Code for owners with a household income of less than $30,000, | ||||||
2 | then the calculation of Available Local Resources shall not be | ||||||
3 | affected by the difference, if any, because of those additional | ||||||
4 | exemptions.
| ||||||
5 | This equalized assessed valuation, as adjusted further by | ||||||
6 | the requirements of
this subsection, shall be utilized in the | ||||||
7 | calculation of Available Local
Resources.
| ||||||
8 | (2) The equalized assessed valuation in paragraph (1) shall | ||||||
9 | be adjusted, as
applicable, in the following manner:
| ||||||
10 | (a) For the purposes of calculating State aid under | ||||||
11 | this Section,
with respect to any part of a school district | ||||||
12 | within a redevelopment
project area in respect to which a | ||||||
13 | municipality has adopted tax
increment allocation | ||||||
14 | financing pursuant to the Tax Increment Allocation
| ||||||
15 | Redevelopment Act, Sections 11-74.4-1 through 11-74.4-11 | ||||||
16 | of the Illinois
Municipal Code or the Industrial Jobs | ||||||
17 | Recovery Law, Sections 11-74.6-1 through
11-74.6-50 of the | ||||||
18 | Illinois Municipal Code, no part of the current equalized
| ||||||
19 | assessed valuation of real property located in any such | ||||||
20 | project area which is
attributable to an increase above the | ||||||
21 | total initial equalized assessed
valuation of such | ||||||
22 | property shall be used as part of the equalized assessed
| ||||||
23 | valuation of the district, until such time as all
| ||||||
24 | redevelopment project costs have been paid, as provided in | ||||||
25 | Section 11-74.4-8
of the Tax Increment Allocation | ||||||
26 | Redevelopment Act or in Section 11-74.6-35 of
the |
| |||||||
| |||||||
1 | Industrial Jobs Recovery Law. For the purpose of
the | ||||||
2 | equalized assessed valuation of the
district, the total | ||||||
3 | initial equalized assessed valuation or the current
| ||||||
4 | equalized assessed valuation, whichever is lower, shall be | ||||||
5 | used until
such time as all redevelopment project costs | ||||||
6 | have been paid.
| ||||||
7 | (b) The real property equalized assessed valuation for | ||||||
8 | a school district
shall be adjusted by subtracting from the | ||||||
9 | real property
value as equalized or assessed by the | ||||||
10 | Department of Revenue for the
district an amount computed | ||||||
11 | by dividing the amount of any abatement of
taxes under | ||||||
12 | Section 18-170 of the Property Tax Code by 3.00% for a | ||||||
13 | district
maintaining grades kindergarten through 12, by | ||||||
14 | 2.30% for a district
maintaining grades kindergarten | ||||||
15 | through 8, or by 1.05% for a
district
maintaining grades 9 | ||||||
16 | through 12 and adjusted by an amount computed by dividing
| ||||||
17 | the amount of any abatement of taxes under subsection (a) | ||||||
18 | of Section 18-165 of
the Property Tax Code by the same | ||||||
19 | percentage rates for district type as
specified in this | ||||||
20 | subparagraph (b).
| ||||||
21 | (3) For the 1999-2000 school year and each school year | ||||||
22 | thereafter, if a
school district meets all of the criteria of | ||||||
23 | this subsection (G)(3), the school
district's Available Local | ||||||
24 | Resources shall be calculated under subsection (D)
using the | ||||||
25 | district's Extension Limitation Equalized Assessed Valuation | ||||||
26 | as
calculated under this
subsection (G)(3).
|
| |||||||
| |||||||
1 | For purposes of this subsection (G)(3) the following terms | ||||||
2 | shall have
the following meanings:
| ||||||
3 | "Budget Year": The school year for which general State | ||||||
4 | aid is calculated
and
awarded under subsection (E).
| ||||||
5 | "Base Tax Year": The property tax levy year used to | ||||||
6 | calculate the Budget
Year
allocation of general State aid.
| ||||||
7 | "Preceding Tax Year": The property tax levy year | ||||||
8 | immediately preceding the
Base Tax Year.
| ||||||
9 | "Base Tax Year's Tax Extension": The product of the | ||||||
10 | equalized assessed
valuation utilized by the County Clerk | ||||||
11 | in the Base Tax Year multiplied by the
limiting rate as | ||||||
12 | calculated by the County Clerk and defined in the Property | ||||||
13 | Tax
Extension Limitation Law.
| ||||||
14 | "Preceding Tax Year's Tax Extension": The product of | ||||||
15 | the equalized assessed
valuation utilized by the County | ||||||
16 | Clerk in the Preceding Tax Year multiplied by
the Operating | ||||||
17 | Tax Rate as defined in subsection (A).
| ||||||
18 | "Extension Limitation Ratio": A numerical ratio, | ||||||
19 | certified by the
County Clerk, in which the numerator is | ||||||
20 | the Base Tax Year's Tax
Extension and the denominator is | ||||||
21 | the Preceding Tax Year's Tax Extension.
| ||||||
22 | "Operating Tax Rate": The operating tax rate as defined | ||||||
23 | in subsection (A).
| ||||||
24 | If a school district is subject to property tax extension | ||||||
25 | limitations as
imposed under
the Property Tax Extension | ||||||
26 | Limitation Law, the State Board of Education shall
calculate |
| |||||||
| |||||||
1 | the Extension
Limitation
Equalized Assessed Valuation of that | ||||||
2 | district. For the 1999-2000 school
year, the
Extension | ||||||
3 | Limitation Equalized Assessed Valuation of a school district as
| ||||||
4 | calculated by the State Board of Education shall be equal to | ||||||
5 | the product of the
district's 1996 Equalized Assessed Valuation | ||||||
6 | and the district's Extension
Limitation Ratio. For the | ||||||
7 | 2000-2001 school year and each school year
thereafter,
the | ||||||
8 | Extension Limitation Equalized Assessed Valuation of a school | ||||||
9 | district as
calculated by the State Board of Education shall be | ||||||
10 | equal to the product of
the Equalized Assessed Valuation last | ||||||
11 | used in the calculation of general State
aid and the
district's | ||||||
12 | Extension Limitation Ratio. If the Extension Limitation
| ||||||
13 | Equalized
Assessed Valuation of a school district as calculated | ||||||
14 | under
this subsection (G)(3) is less than the district's | ||||||
15 | equalized assessed valuation
as calculated pursuant to | ||||||
16 | subsections (G)(1) and (G)(2), then for purposes of
calculating | ||||||
17 | the district's general State aid for the Budget Year pursuant | ||||||
18 | to
subsection (E), that Extension
Limitation Equalized | ||||||
19 | Assessed Valuation shall be utilized to calculate the
| ||||||
20 | district's Available Local Resources
under subsection (D).
| ||||||
21 | Partial elementary unit districts created in accordance | ||||||
22 | with Article 11E of this Code shall not be eligible for the | ||||||
23 | adjustment in this subsection (G)(3) until the fifth year | ||||||
24 | following the effective date of the reorganization.
| ||||||
25 | (4) For the purposes of calculating general State aid for | ||||||
26 | the 1999-2000
school year only, if a school district |
| |||||||
| |||||||
1 | experienced a triennial reassessment on
the equalized assessed | ||||||
2 | valuation used in calculating its general State
financial aid | ||||||
3 | apportionment for the 1998-1999 school year, the State Board of
| ||||||
4 | Education shall calculate the Extension Limitation Equalized | ||||||
5 | Assessed Valuation
that would have been used to calculate the | ||||||
6 | district's 1998-1999 general State
aid. This amount shall equal | ||||||
7 | the product of the equalized assessed valuation
used to
| ||||||
8 | calculate general State aid for the 1997-1998 school year and | ||||||
9 | the district's
Extension Limitation Ratio. If the Extension | ||||||
10 | Limitation Equalized Assessed
Valuation of the school district | ||||||
11 | as calculated under this paragraph (4) is
less than the | ||||||
12 | district's equalized assessed valuation utilized in | ||||||
13 | calculating
the
district's 1998-1999 general State aid | ||||||
14 | allocation, then for purposes of
calculating the district's | ||||||
15 | general State aid pursuant to paragraph (5) of
subsection (E),
| ||||||
16 | that Extension Limitation Equalized Assessed Valuation shall | ||||||
17 | be utilized to
calculate the district's Available Local | ||||||
18 | Resources.
| ||||||
19 | (5) For school districts having a majority of their | ||||||
20 | equalized assessed
valuation in any county except Cook, DuPage, | ||||||
21 | Kane, Lake, McHenry, or Will, if
the amount of general State | ||||||
22 | aid allocated to the school district for the
1999-2000 school | ||||||
23 | year under the provisions of subsection (E), (H), and (J) of
| ||||||
24 | this Section is less than the amount of general State aid | ||||||
25 | allocated to the
district for the 1998-1999 school year under | ||||||
26 | these subsections, then the
general
State aid of the district |
| |||||||
| |||||||
1 | for the 1999-2000 school year only shall be increased
by the | ||||||
2 | difference between these amounts. The total payments made under | ||||||
3 | this
paragraph (5) shall not exceed $14,000,000. Claims shall | ||||||
4 | be prorated if they
exceed $14,000,000.
| ||||||
5 | (H) Supplemental General State Aid.
| ||||||
6 | (1) In addition to the general State aid a school district | ||||||
7 | is allotted
pursuant to subsection (E), qualifying school | ||||||
8 | districts shall receive a grant,
paid in conjunction with a | ||||||
9 | district's payments of general State aid, for
supplemental | ||||||
10 | general State aid based upon the concentration level of | ||||||
11 | children
from low-income households within the school | ||||||
12 | district.
Supplemental State aid grants provided for school | ||||||
13 | districts under this
subsection shall be appropriated for | ||||||
14 | distribution to school districts as part
of the same line item | ||||||
15 | in which the general State financial aid of school
districts is | ||||||
16 | appropriated under this Section.
If the appropriation in any | ||||||
17 | fiscal year for general State aid and
supplemental general | ||||||
18 | State aid is insufficient to pay the amounts required
under the | ||||||
19 | general State aid and supplemental general State aid | ||||||
20 | calculations,
then the
State Board of Education shall ensure | ||||||
21 | that
each school district receives the full amount due for | ||||||
22 | general State aid
and the remainder of the appropriation shall | ||||||
23 | be used
for supplemental general State aid, which the State | ||||||
24 | Board of Education shall
calculate and pay to eligible | ||||||
25 | districts on a prorated basis.
|
| |||||||
| |||||||
1 | (1.5) This paragraph (1.5) applies only to those school | ||||||
2 | years
preceding the 2003-2004 school year.
For purposes of this
| ||||||
3 | subsection (H), the term "Low-Income Concentration Level" | ||||||
4 | shall be the
low-income
eligible pupil count from the most | ||||||
5 | recently available federal census divided by
the Average Daily | ||||||
6 | Attendance of the school district.
If, however, (i) the | ||||||
7 | percentage decrease from the 2 most recent federal
censuses
in | ||||||
8 | the low-income eligible pupil count of a high school district | ||||||
9 | with fewer
than 400 students exceeds by 75% or more the | ||||||
10 | percentage change in the total
low-income eligible pupil count | ||||||
11 | of contiguous elementary school districts,
whose boundaries | ||||||
12 | are coterminous with the high school district,
or (ii) a high | ||||||
13 | school district within 2 counties and serving 5 elementary
| ||||||
14 | school
districts, whose boundaries are coterminous with the | ||||||
15 | high school
district, has a percentage decrease from the 2 most | ||||||
16 | recent federal
censuses in the low-income eligible pupil count | ||||||
17 | and there is a percentage
increase in the total low-income | ||||||
18 | eligible pupil count of a majority of the
elementary school | ||||||
19 | districts in excess of 50% from the 2 most recent
federal | ||||||
20 | censuses, then
the
high school district's low-income eligible | ||||||
21 | pupil count from the earlier federal
census
shall be the number | ||||||
22 | used as the low-income eligible pupil count for the high
school | ||||||
23 | district, for purposes of this subsection (H).
The changes made | ||||||
24 | to this paragraph (1) by Public Act 92-28 shall apply to
| ||||||
25 | supplemental general State aid
grants for school years | ||||||
26 | preceding the 2003-2004 school year that are paid
in fiscal |
| |||||||
| |||||||
1 | year 1999 or thereafter
and to
any State aid payments made in | ||||||
2 | fiscal year 1994 through fiscal year
1998 pursuant to | ||||||
3 | subsection 1(n) of Section 18-8 of this Code (which was
| ||||||
4 | repealed on July 1, 1998), and any high school district that is | ||||||
5 | affected by
Public Act 92-28 is
entitled to a
recomputation of | ||||||
6 | its supplemental general State aid grant or State aid
paid in | ||||||
7 | any of those fiscal years. This recomputation shall not be
| ||||||
8 | affected by any other funding.
| ||||||
9 | (1.10) This paragraph (1.10) applies to the 2003-2004 | ||||||
10 | school year
and each school year thereafter. For purposes of | ||||||
11 | this subsection (H), the
term "Low-Income Concentration Level" | ||||||
12 | shall, for each fiscal year, be the
low-income eligible
pupil | ||||||
13 | count
as of July 1 of the immediately preceding fiscal year
(as | ||||||
14 | determined by the Department of Human Services based
on the | ||||||
15 | number of pupils
who are eligible for at least one of the | ||||||
16 | following
low income programs: Medicaid, KidCare, TANF, or Food | ||||||
17 | Stamps,
excluding pupils who are eligible for services provided | ||||||
18 | by the Department
of Children and Family Services,
averaged | ||||||
19 | over
the 2 immediately preceding fiscal years for fiscal year | ||||||
20 | 2004 and over the 3
immediately preceding fiscal years for each | ||||||
21 | fiscal year thereafter)
divided by the Average Daily Attendance | ||||||
22 | of the school district.
| ||||||
23 | (2) Supplemental general State aid pursuant to this | ||||||
24 | subsection (H) shall
be
provided as follows for the 1998-1999, | ||||||
25 | 1999-2000, and 2000-2001 school years
only:
| ||||||
26 | (a) For any school district with a Low Income |
| |||||||
| |||||||
1 | Concentration Level of at
least 20% and less than 35%, the | ||||||
2 | grant for any school year
shall be $800
multiplied by the | ||||||
3 | low income eligible pupil count.
| ||||||
4 | (b) For any school district with a Low Income | ||||||
5 | Concentration Level of at
least 35% and less than 50%, the | ||||||
6 | grant for the 1998-1999 school year shall be
$1,100 | ||||||
7 | multiplied by the low income eligible pupil count.
| ||||||
8 | (c) For any school district with a Low Income | ||||||
9 | Concentration Level of at
least 50% and less than 60%, the | ||||||
10 | grant for the 1998-99 school year shall be
$1,500 | ||||||
11 | multiplied by the low income eligible pupil count.
| ||||||
12 | (d) For any school district with a Low Income | ||||||
13 | Concentration Level of 60%
or more, the grant for the | ||||||
14 | 1998-99 school year shall be $1,900 multiplied by
the low | ||||||
15 | income eligible pupil count.
| ||||||
16 | (e) For the 1999-2000 school year, the per pupil amount | ||||||
17 | specified in
subparagraphs (b), (c), and (d) immediately | ||||||
18 | above shall be increased to $1,243,
$1,600, and $2,000, | ||||||
19 | respectively.
| ||||||
20 | (f) For the 2000-2001 school year, the per pupil | ||||||
21 | amounts specified in
subparagraphs (b), (c), and (d) | ||||||
22 | immediately above shall be
$1,273, $1,640, and $2,050, | ||||||
23 | respectively.
| ||||||
24 | (2.5) Supplemental general State aid pursuant to this | ||||||
25 | subsection (H)
shall be provided as follows for the 2002-2003 | ||||||
26 | school year:
|
| |||||||
| |||||||
1 | (a) For any school district with a Low Income | ||||||
2 | Concentration Level of less
than 10%, the grant for each | ||||||
3 | school year shall be $355 multiplied by the low
income | ||||||
4 | eligible pupil count.
| ||||||
5 | (b) For any school district with a Low Income | ||||||
6 | Concentration
Level of at least 10% and less than 20%, the | ||||||
7 | grant for each school year shall
be $675
multiplied by the | ||||||
8 | low income eligible pupil
count.
| ||||||
9 | (c) For any school district with a Low Income | ||||||
10 | Concentration
Level of at least 20% and less than 35%, the | ||||||
11 | grant for each school year shall
be $1,330
multiplied by | ||||||
12 | the low income eligible pupil
count.
| ||||||
13 | (d) For any school district with a Low Income | ||||||
14 | Concentration
Level of at least 35% and less than 50%, the | ||||||
15 | grant for each school year shall
be $1,362
multiplied by | ||||||
16 | the low income eligible pupil
count.
| ||||||
17 | (e) For any school district with a Low Income | ||||||
18 | Concentration
Level of at least 50% and less than 60%, the | ||||||
19 | grant for each school year shall
be $1,680
multiplied by | ||||||
20 | the low income eligible pupil
count.
| ||||||
21 | (f) For any school district with a Low Income | ||||||
22 | Concentration
Level of 60% or more, the grant for each | ||||||
23 | school year shall be $2,080
multiplied by the low income | ||||||
24 | eligible pupil count.
| ||||||
25 | (2.10) Except as otherwise provided, supplemental general | ||||||
26 | State aid
pursuant to this subsection
(H) shall be provided as |
| |||||||
| |||||||
1 | follows for the 2003-2004 school year and each
school year | ||||||
2 | thereafter:
| ||||||
3 | (a) For any school district with a Low Income | ||||||
4 | Concentration
Level of 15% or less, the grant for the | ||||||
5 | 2003-2004 school year through the 2006-2007
each school | ||||||
6 | year
shall be $355 multiplied by the low income eligible | ||||||
7 | pupil count . For the 2007-2008 school year and each school | ||||||
8 | year thereafter, the grant shall be $355, increased by the | ||||||
9 | percentage increase, if any, in the ECI published for the | ||||||
10 | immediately preceding school year, and then multiplied by | ||||||
11 | the low income eligible pupil count .
| ||||||
12 | (b) For any school district with a Low Income | ||||||
13 | Concentration
Level greater than 15%, the grant for the | ||||||
14 | 2003-2004 school year through the 2006-2007
each school | ||||||
15 | year shall be
$294.25 added to the product of $2,700 and | ||||||
16 | the square of the Low
Income Concentration Level, all | ||||||
17 | multiplied by the low income
eligible pupil count. For the | ||||||
18 | 2007-2008 school year and each school year thereafter, the | ||||||
19 | grant shall be $294.25, increased by the percentage | ||||||
20 | increase, if any, in the ECI published for the immediately | ||||||
21 | preceding school year, then added to the product of (i) | ||||||
22 | $2,700, which amount shall be increased by the percentage | ||||||
23 | increase, if any, in the ECI published for the immediately | ||||||
24 | preceding school year, and (ii) the square of the Low | ||||||
25 | Income Concentration Level, and then all multiplied by the | ||||||
26 | low income eligible pupil count.
|
| |||||||
| |||||||
1 | For the 2003-2004 school year, 2004-2005 school year,
| ||||||
2 | 2005-2006 school year, and 2006-2007 school year only, the | ||||||
3 | grant shall be no less than the
grant
for
the 2002-2003 school | ||||||
4 | year. For the 2007-2008 school year only, the grant shall
be no
| ||||||
5 | less than the grant for the 2002-2003 school year multiplied by | ||||||
6 | 0.66. For the
2008-2009
school year only, the grant shall be no | ||||||
7 | less than the grant for the 2002-2003
school year
multiplied by | ||||||
8 | 0.33. Notwithstanding the provisions of this paragraph to the | ||||||
9 | contrary, if for any school year supplemental general State aid | ||||||
10 | grants are prorated as provided in paragraph (1) of this | ||||||
11 | subsection (H), then the grants under this paragraph shall be | ||||||
12 | prorated.
| ||||||
13 | For the 2003-2004 school year only, the grant shall be no | ||||||
14 | greater
than the grant received during the 2002-2003 school | ||||||
15 | year added to the
product of 0.25 multiplied by the difference | ||||||
16 | between the grant amount
calculated under subsection (a) or (b) | ||||||
17 | of this paragraph (2.10), whichever
is applicable, and the | ||||||
18 | grant received during the 2002-2003 school year.
For the | ||||||
19 | 2004-2005 school year only, the grant shall be no greater than
| ||||||
20 | the grant received during the 2002-2003 school year added to | ||||||
21 | the
product of 0.50 multiplied by the difference between the | ||||||
22 | grant amount
calculated under subsection (a) or (b) of this | ||||||
23 | paragraph (2.10), whichever
is applicable, and the grant | ||||||
24 | received during the 2002-2003 school year.
For the 2005-2006 | ||||||
25 | school year only, the grant shall be no greater than
the grant | ||||||
26 | received during the 2002-2003 school year added to the
product |
| |||||||
| |||||||
1 | of 0.75 multiplied by the difference between the grant amount
| ||||||
2 | calculated under subsection (a) or (b) of this paragraph | ||||||
3 | (2.10), whichever
is applicable, and the grant received during | ||||||
4 | the 2002-2003
school year.
| ||||||
5 | (3) School districts with an Average Daily Attendance of | ||||||
6 | more than 1,000
and less than 50,000 that qualify for | ||||||
7 | supplemental general State aid pursuant
to this subsection | ||||||
8 | shall submit a plan to the State Board of Education prior to
| ||||||
9 | October 30 of each year for the use of the funds resulting from | ||||||
10 | this grant of
supplemental general State aid for the | ||||||
11 | improvement of
instruction in which priority is given to | ||||||
12 | meeting the education needs of
disadvantaged children. Such | ||||||
13 | plan shall be submitted in accordance with
rules and | ||||||
14 | regulations promulgated by the State Board of Education.
| ||||||
15 | (4) School districts with an Average Daily Attendance of | ||||||
16 | 50,000 or more
that qualify for supplemental general State aid | ||||||
17 | pursuant to this subsection
shall be required to distribute | ||||||
18 | from funds available pursuant to this Section,
no less than | ||||||
19 | $261,000,000 in accordance with the following requirements:
| ||||||
20 | (a) The required amounts shall be distributed to the | ||||||
21 | attendance centers
within the district in proportion to the | ||||||
22 | number of pupils enrolled at each
attendance center who are | ||||||
23 | eligible to receive free or reduced-price lunches or
| ||||||
24 | breakfasts under the federal Child Nutrition Act of 1966 | ||||||
25 | and under the National
School Lunch Act during the | ||||||
26 | immediately preceding school year.
|
| |||||||
| |||||||
1 | (b) The distribution of these portions of supplemental | ||||||
2 | and general State
aid among attendance centers according to | ||||||
3 | these requirements shall not be
compensated for or | ||||||
4 | contravened by adjustments of the total of other funds
| ||||||
5 | appropriated to any attendance centers, and the Board of | ||||||
6 | Education shall
utilize funding from one or several sources | ||||||
7 | in order to fully implement this
provision annually prior | ||||||
8 | to the opening of school.
| ||||||
9 | (c) Each attendance center shall be provided by the
| ||||||
10 | school district a distribution of noncategorical funds and | ||||||
11 | other
categorical funds to which an attendance center is | ||||||
12 | entitled under law in
order that the general State aid and | ||||||
13 | supplemental general State aid provided
by application of | ||||||
14 | this subsection supplements rather than supplants the
| ||||||
15 | noncategorical funds and other categorical funds provided | ||||||
16 | by the school
district to the attendance centers.
| ||||||
17 | (d) Any funds made available under this subsection that | ||||||
18 | by reason of the
provisions of this subsection are not
| ||||||
19 | required to be allocated and provided to attendance centers | ||||||
20 | may be used and
appropriated by the board of the district | ||||||
21 | for any lawful school purpose.
| ||||||
22 | (e) Funds received by an attendance center
pursuant to | ||||||
23 | this
subsection shall be used
by the attendance center at | ||||||
24 | the discretion
of the principal and local school council | ||||||
25 | for programs to improve educational
opportunities at | ||||||
26 | qualifying schools through the following programs and
|
| |||||||
| |||||||
1 | services: early childhood education, reduced class size or | ||||||
2 | improved adult to
student classroom ratio, enrichment | ||||||
3 | programs, remedial assistance, attendance
improvement, and | ||||||
4 | other educationally beneficial expenditures which
| ||||||
5 | supplement
the regular and basic programs as determined by | ||||||
6 | the State Board of Education.
Funds provided shall not be | ||||||
7 | expended for any political or lobbying purposes
as defined | ||||||
8 | by board rule.
| ||||||
9 | (f) Each district subject to the provisions of this | ||||||
10 | subdivision (H)(4)
shall submit an
acceptable plan to meet | ||||||
11 | the educational needs of disadvantaged children, in
| ||||||
12 | compliance with the requirements of this paragraph, to the | ||||||
13 | State Board of
Education prior to July 15 of each year. | ||||||
14 | This plan shall be consistent with the
decisions of local | ||||||
15 | school councils concerning the school expenditure plans
| ||||||
16 | developed in accordance with part 4 of Section 34-2.3. The | ||||||
17 | State Board shall
approve or reject the plan within 60 days | ||||||
18 | after its submission. If the plan is
rejected, the district | ||||||
19 | shall give written notice of intent to modify the plan
| ||||||
20 | within 15 days of the notification of rejection and then | ||||||
21 | submit a modified plan
within 30 days after the date of the | ||||||
22 | written notice of intent to modify.
Districts may amend | ||||||
23 | approved plans pursuant to rules promulgated by the State
| ||||||
24 | Board of Education.
| ||||||
25 | Upon notification by the State Board of Education that | ||||||
26 | the district has
not submitted a plan prior to July 15 or a |
| |||||||
| |||||||
1 | modified plan within the time
period specified herein, the
| ||||||
2 | State aid funds affected by that plan or modified plan | ||||||
3 | shall be withheld by the
State Board of Education until a | ||||||
4 | plan or modified plan is submitted.
| ||||||
5 | If the district fails to distribute State aid to | ||||||
6 | attendance centers in
accordance with an approved plan, the | ||||||
7 | plan for the following year shall
allocate funds, in | ||||||
8 | addition to the funds otherwise required by this
| ||||||
9 | subsection, to those attendance centers which were | ||||||
10 | underfunded during the
previous year in amounts equal to | ||||||
11 | such underfunding.
| ||||||
12 | For purposes of determining compliance with this | ||||||
13 | subsection in relation
to the requirements of attendance | ||||||
14 | center funding, each district subject to the
provisions of | ||||||
15 | this
subsection shall submit as a separate document by | ||||||
16 | December 1 of each year a
report of expenditure data for | ||||||
17 | the prior year in addition to any
modification of its | ||||||
18 | current plan. If it is determined that there has been
a | ||||||
19 | failure to comply with the expenditure provisions of this | ||||||
20 | subsection
regarding contravention or supplanting, the | ||||||
21 | State Superintendent of
Education shall, within 60 days of | ||||||
22 | receipt of the report, notify the
district and any affected | ||||||
23 | local school council. The district shall within
45 days of | ||||||
24 | receipt of that notification inform the State | ||||||
25 | Superintendent of
Education of the remedial or corrective | ||||||
26 | action to be taken, whether by
amendment of the current |
| |||||||
| |||||||
1 | plan, if feasible, or by adjustment in the plan
for the | ||||||
2 | following year. Failure to provide the expenditure report | ||||||
3 | or the
notification of remedial or corrective action in a | ||||||
4 | timely manner shall
result in a withholding of the affected | ||||||
5 | funds.
| ||||||
6 | The State Board of Education shall promulgate rules and | ||||||
7 | regulations
to implement the provisions of this | ||||||
8 | subsection. No funds shall be released
under this | ||||||
9 | subdivision (H)(4) to any district that has not submitted a | ||||||
10 | plan
that has been approved by the State Board of | ||||||
11 | Education.
| ||||||
12 | (I) (Blank).
| ||||||
13 | (J) Supplementary Grants in Aid.
| ||||||
14 | (1) Notwithstanding any other provisions of this Section, | ||||||
15 | the amount of the
aggregate general State aid in combination | ||||||
16 | with supplemental general State aid
under this Section for | ||||||
17 | which
each school district is eligible shall be no
less than | ||||||
18 | the amount of the aggregate general State aid entitlement that | ||||||
19 | was
received by the district under Section
18-8 (exclusive of | ||||||
20 | amounts received
under subsections 5(p) and 5(p-5) of that | ||||||
21 | Section)
for the 1997-98 school year,
pursuant to the | ||||||
22 | provisions of that Section as it was then in effect.
If a | ||||||
23 | school district qualifies to receive a supplementary payment | ||||||
24 | made under
this subsection (J), the amount
of the aggregate |
| |||||||
| |||||||
1 | general State aid in combination with supplemental general
| ||||||
2 | State aid under this Section
which that district is eligible to | ||||||
3 | receive for each school year shall be no less than the amount | ||||||
4 | of the aggregate
general State aid entitlement that was | ||||||
5 | received by the district under
Section 18-8 (exclusive of | ||||||
6 | amounts received
under subsections 5(p) and 5(p-5) of that | ||||||
7 | Section)
for the 1997-1998 school year, pursuant to the | ||||||
8 | provisions of that
Section as it was then in effect.
| ||||||
9 | (2) If, as provided in paragraph (1) of this subsection | ||||||
10 | (J), a school
district is to receive aggregate general State | ||||||
11 | aid in
combination with supplemental general State aid under | ||||||
12 | this Section for the 1998-99 school year and any subsequent | ||||||
13 | school
year that in any such school year is less than the | ||||||
14 | amount of the aggregate
general
State
aid entitlement that the | ||||||
15 | district received for the 1997-98 school year, the
school | ||||||
16 | district shall also receive, from a separate appropriation made | ||||||
17 | for
purposes of this subsection (J), a supplementary payment | ||||||
18 | that is equal to the
amount of the difference in the aggregate | ||||||
19 | State aid figures as described in
paragraph (1).
| ||||||
20 | (3) (Blank).
| ||||||
21 | (K) Grants to Laboratory and Alternative Schools.
| ||||||
22 | In calculating the amount to be paid to the governing board | ||||||
23 | of a public
university that operates a laboratory school under | ||||||
24 | this Section or to any
alternative school that is operated by a | ||||||
25 | regional superintendent of schools,
the State
Board of |
| |||||||
| |||||||
1 | Education shall require by rule such reporting requirements as | ||||||
2 | it
deems necessary.
| ||||||
3 | As used in this Section, "laboratory school" means a public | ||||||
4 | school which is
created and operated by a public university and | ||||||
5 | approved by the State Board of
Education. The governing board | ||||||
6 | of a public university which receives funds
from the State | ||||||
7 | Board under this subsection (K) may not increase the number of
| ||||||
8 | students enrolled in its laboratory
school from a single | ||||||
9 | district, if that district is already sending 50 or more
| ||||||
10 | students, except under a mutual agreement between the school | ||||||
11 | board of a
student's district of residence and the university | ||||||
12 | which operates the
laboratory school. A laboratory school may | ||||||
13 | not have more than 1,000 students,
excluding students with | ||||||
14 | disabilities in a special education program.
| ||||||
15 | As used in this Section, "alternative school" means a | ||||||
16 | public school which is
created and operated by a Regional | ||||||
17 | Superintendent of Schools and approved by
the State Board of | ||||||
18 | Education. Such alternative schools may offer courses of
| ||||||
19 | instruction for which credit is given in regular school | ||||||
20 | programs, courses to
prepare students for the high school | ||||||
21 | equivalency testing program or vocational
and occupational | ||||||
22 | training. A regional superintendent of schools may contract
| ||||||
23 | with a school district or a public community college district | ||||||
24 | to operate an
alternative school. An alternative school serving | ||||||
25 | more than one educational
service region may be established by | ||||||
26 | the regional superintendents of schools
of the affected |
| |||||||
| |||||||
1 | educational service regions. An alternative school
serving | ||||||
2 | more than one educational service region may be operated under | ||||||
3 | such
terms as the regional superintendents of schools of those | ||||||
4 | educational service
regions may agree.
| ||||||
5 | Each laboratory and alternative school shall file, on forms | ||||||
6 | provided by the
State Superintendent of Education, an annual | ||||||
7 | State aid claim which states the
Average Daily Attendance of | ||||||
8 | the school's students by month. The best 3 months'
Average | ||||||
9 | Daily Attendance shall be computed for each school.
The general | ||||||
10 | State aid entitlement shall be computed by multiplying the
| ||||||
11 | applicable Average Daily Attendance by the Foundation Level as | ||||||
12 | determined under
this Section.
| ||||||
13 | (L) Payments, Additional Grants in Aid and Other Requirements.
| ||||||
14 | (1) For a school district operating under the financial | ||||||
15 | supervision
of an Authority created under Article 34A, the | ||||||
16 | general State aid otherwise
payable to that district under this | ||||||
17 | Section, but not the supplemental general
State aid, shall be | ||||||
18 | reduced by an amount equal to the budget for
the operations of | ||||||
19 | the Authority as certified by the Authority to the State
Board | ||||||
20 | of Education, and an amount equal to such reduction shall be | ||||||
21 | paid
to the Authority created for such district for its | ||||||
22 | operating expenses in
the manner provided in Section 18-11. The | ||||||
23 | remainder
of general State school aid for any such district | ||||||
24 | shall be paid in accordance
with Article 34A when that Article | ||||||
25 | provides for a disposition other than that
provided by this |
| |||||||
| |||||||
1 | Article.
| ||||||
2 | (2) (Blank).
| ||||||
3 | (3) Summer school. Summer school payments shall be made as | ||||||
4 | provided in
Section 18-4.3.
| ||||||
5 | (M) Education Funding Advisory Board.
| ||||||
6 | The Education Funding Advisory
Board, hereinafter in this | ||||||
7 | subsection (M) referred to as the "Board", is hereby
created. | ||||||
8 | The Board
shall consist of 5 members who are appointed by the | ||||||
9 | Governor, by and with the
advice and consent of the Senate. The | ||||||
10 | members appointed shall include
representatives of education, | ||||||
11 | business, and the general public. One of the
members so | ||||||
12 | appointed shall be
designated by the Governor at the time the | ||||||
13 | appointment is made as the
chairperson of the
Board.
The | ||||||
14 | initial members of the Board may
be appointed any time after | ||||||
15 | the effective date of this amendatory Act of
1997. The regular | ||||||
16 | term of each member of the
Board shall be for 4 years from the | ||||||
17 | third Monday of January of the
year in which the term of the | ||||||
18 | member's appointment is to commence, except that
of the 5 | ||||||
19 | initial members appointed to serve on the
Board, the member who | ||||||
20 | is appointed as the chairperson shall serve for
a term that | ||||||
21 | commences on the date of his or her appointment and expires on | ||||||
22 | the
third Monday of January, 2002, and the remaining 4 members, | ||||||
23 | by lots drawn at
the first meeting of the Board that is
held
| ||||||
24 | after all 5 members are appointed, shall determine 2 of their | ||||||
25 | number to serve
for terms that commence on the date of their
|
| |||||||
| |||||||
1 | respective appointments and expire on the third
Monday of | ||||||
2 | January, 2001,
and 2 of their number to serve for terms that | ||||||
3 | commence
on the date of their respective appointments and | ||||||
4 | expire on the third Monday
of January, 2000. All members | ||||||
5 | appointed to serve on the
Board shall serve until their | ||||||
6 | respective successors are
appointed and confirmed. Vacancies | ||||||
7 | shall be filled in the same manner as
original appointments. If | ||||||
8 | a vacancy in membership occurs at a time when the
Senate is not | ||||||
9 | in session, the Governor shall make a temporary appointment | ||||||
10 | until
the next meeting of the Senate, when he or she shall | ||||||
11 | appoint, by and with the
advice and consent of the Senate, a | ||||||
12 | person to fill that membership for the
unexpired term. If the | ||||||
13 | Senate is not in session when the initial appointments
are | ||||||
14 | made, those appointments shall
be made as in the case of | ||||||
15 | vacancies.
| ||||||
16 | The Education Funding Advisory Board shall be deemed | ||||||
17 | established,
and the initial
members appointed by the Governor | ||||||
18 | to serve as members of the
Board shall take office,
on the date | ||||||
19 | that the
Governor makes his or her appointment of the fifth | ||||||
20 | initial member of the
Board, whether those initial members are | ||||||
21 | then serving
pursuant to appointment and confirmation or | ||||||
22 | pursuant to temporary appointments
that are made by the | ||||||
23 | Governor as in the case of vacancies.
| ||||||
24 | The State Board of Education shall provide such staff | ||||||
25 | assistance to the
Education Funding Advisory Board as is | ||||||
26 | reasonably required for the proper
performance by the Board of |
| |||||||
| |||||||
1 | its responsibilities.
| ||||||
2 | For school years after the 2000-2001 school year, the | ||||||
3 | Education
Funding Advisory Board, in consultation with the | ||||||
4 | State Board of Education,
shall make recommendations as | ||||||
5 | provided in this subsection (M) to the General
Assembly for the | ||||||
6 | foundation level under subsection(B)
subdivision (B)(3) of | ||||||
7 | this Section and
for the
supplemental general State aid grant | ||||||
8 | level under subsection (H) of this Section
for districts with | ||||||
9 | high concentrations of children from poverty. The
recommended | ||||||
10 | foundation level shall be determined based on a methodology | ||||||
11 | which
incorporates the basic education expenditures of | ||||||
12 | low-spending schools
exhibiting high academic performance. The | ||||||
13 | Education Funding Advisory Board
shall make such | ||||||
14 | recommendations to the General Assembly on January 1 of odd
| ||||||
15 | numbered years, beginning January 1, 2001.
| ||||||
16 | (N) (Blank).
| ||||||
17 | (O) References.
| ||||||
18 | (1) References in other laws to the various subdivisions of
| ||||||
19 | Section 18-8 as that Section existed before its repeal and | ||||||
20 | replacement by this
Section 18-8.05 shall be deemed to refer to | ||||||
21 | the corresponding provisions of
this Section 18-8.05, to the | ||||||
22 | extent that those references remain applicable.
| ||||||
23 | (2) References in other laws to State Chapter 1 funds shall | ||||||
24 | be deemed to
refer to the supplemental general State aid |
| |||||||
| |||||||
1 | provided under subsection (H) of
this Section.
| ||||||
2 | (P) Public Act 93-838 and Public Act 93-808 make inconsistent | ||||||
3 | changes to this Section. Under Section 6 of the Statute on | ||||||
4 | Statutes there is an irreconcilable conflict between Public Act | ||||||
5 | 93-808 and Public Act 93-838. Public Act 93-838, being the last | ||||||
6 | acted upon, is controlling. The text of Public Act 93-838 is | ||||||
7 | the law regardless of the text of Public Act 93-808. | ||||||
8 | (Source: P.A. 93-21, eff. 7-1-03; 93-715, eff. 7-12-04; 93-808, | ||||||
9 | eff. 7-26-04; 93-838, eff. 7-30-04; 93-875, eff. 8-6-04; 94-69, | ||||||
10 | eff. 7-1-05; 94-438, eff. 8-4-05; 94-835, eff. 6-6-06; 94-1019, | ||||||
11 | eff. 7-10-06; revised 8-3-06.)
| ||||||
12 | (105 ILCS 5/18-8.15 new)
| ||||||
13 | Sec. 18-8.15. Supplemental State aid for rapidly expanding | ||||||
14 | school districts. | ||||||
15 | (a) If there has been an increase in a school district's | ||||||
16 | student population over any 2 consecutive school years of (i) | ||||||
17 | over 1.5% in a district with 10,000 or more pupils in average | ||||||
18 | daily attendance, as defined in Section 18-8.05 of this Code, | ||||||
19 | or (ii) over 10% in any other district, then, subject to | ||||||
20 | appropriation, the district is eligible for a grant under this | ||||||
21 | Section. | ||||||
22 | (b) The State Board of Education shall determine a per | ||||||
23 | pupil grant amount for each school district based on the needs | ||||||
24 | of each district. The total grant amount for a district for any |
| |||||||
| |||||||
1 | given school year shall equal the per pupil grant amount | ||||||
2 | multiplied by the difference between the number of pupils in | ||||||
3 | average daily attendance for the first 3 months of the school | ||||||
4 | year and the number of pupils in average daily attendance for | ||||||
5 | the immediately preceding school year. | ||||||
6 | (c) Each fiscal year, the General Assembly shall | ||||||
7 | appropriate at least $40 million of the aggregate Common School | ||||||
8 | Fund appropriation to funding supplemental grants under this | ||||||
9 | Section. Funds for grants under this Section must be | ||||||
10 | appropriated to the State Board of Education in a separate line | ||||||
11 | item for this purpose. As soon as possible after funds have | ||||||
12 | been appropriated to the State Board of Education, the State | ||||||
13 | Board of Education shall distribute the grants to eligible | ||||||
14 | districts. | ||||||
15 | (d) If a school district intentionally reports incorrect | ||||||
16 | average daily attendance numbers to receive a grant under this | ||||||
17 | Section, then the district shall be denied State aid for | ||||||
18 | intentional incorrect reporting of average daily attendance | ||||||
19 | numbers under Section 18-8.05 of this Code. | ||||||
20 | (e) The State Board of Education may adopt any rules | ||||||
21 | necessary to implement this Section. | ||||||
22 | (105 ILCS 5/18-25 new) | ||||||
23 | Sec. 18-25. Education appropriation minimum. At a minimum, | ||||||
24 | the General Assembly shall appropriate to the Common School | ||||||
25 | Fund for fiscal year 2008 and each fiscal year thereafter, an |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1 | amount equal to the following (the "Education Appropriation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2 | Minimum"): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
3 | (1) For fiscal year 2008, a total appropriation equal | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4 | to the sum of (A) all amounts appropriated to the Common | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5 | School Fund for fiscal year 2007, plus (B) the amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
6 | necessary to increase the Foundation Level of support per | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
7 | student to $5,952 under Section 18-8.05 of this Code, plus | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8 | (C) $2.4 billion to fund the School District Property Tax | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
9 | Relief Fund described in Section 6z-65 of the State Finance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10 | Act. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
11 | (2) For each fiscal year thereafter, a total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
12 | appropriation equal to (A) the Education Appropriation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
13 | Minimum for the immediately preceding fiscal year, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
14 | increased by the percentage increase, if any, in the | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
15 | Employment Cost Index published by the U.S. Bureau of Labor | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
16 | Statistics for the immediately preceding fiscal year, or | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
17 | (B) such greater amount as the General Assembly may | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
18 | appropriate.
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||