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1 | AN ACT concerning economic development.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 1. Short title. This Act may be cited as the New | ||||||
5 | Markets Development Program Act. | ||||||
6 | Section 5. Definitions. As used in this Act:
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7 | "Applicable percentage" means 0% for each of the first 2 | ||||||
8 | credit allowance dates, 7% for the third credit allowance date, | ||||||
9 | and 8% for the next 4 credit allowance dates. | ||||||
10 | "Credit allowance date" means with respect to any qualified | ||||||
11 | equity investment:
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12 | (1) the date on which the investment is initially made; | ||||||
13 | and | ||||||
14 | (2) each of the 6 anniversary dates of that date | ||||||
15 | thereafter. | ||||||
16 | "Department" means the Department of Commerce and Economic | ||||||
17 | Opportunity. | ||||||
18 | "Long-term debt security" means any debt instrument issued | ||||||
19 | by a qualified community development entity, at par value or a | ||||||
20 | premium, with an original maturity date of at least 7 years | ||||||
21 | from the date of its issuance, with no acceleration of | ||||||
22 | repayment, amortization, or prepayment features prior to its | ||||||
23 | original maturity date. Cumulative cash payments of interest on |
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1 | the qualified debt instrument during the period commencing with | ||||||
2 | the issuance of the qualified debt instrument and ending with | ||||||
3 | the seventh anniversary of its issuance shall not exceed the | ||||||
4 | sum of such cash interest payments and the cumulative net | ||||||
5 | income of the issuing community development entity for the same | ||||||
6 | period. This definition in no way limits the holder's ability | ||||||
7 | to accelerate payments on the debt instrument in situations | ||||||
8 | where the issuer has defaulted on covenants designed to ensure | ||||||
9 | compliance with this Act or Section 45D of the Internal Revenue | ||||||
10 | Code of 1986, as amended. | ||||||
11 | "Purchase price" means the amount paid to the issuer of a | ||||||
12 | qualified equity investment for that qualified equity | ||||||
13 | investment. | ||||||
14 | "Qualified active low-income community business" has the | ||||||
15 | meaning given to that term in Section 45D of the Internal | ||||||
16 | Revenue Code of 1986, as amended; except that any business that | ||||||
17 | derives or projects to derive 15% or more of its annual revenue | ||||||
18 | from the rental or sale of real estate is not considered to be | ||||||
19 | a qualified active low-income community business. This | ||||||
20 | exception does not apply to a business that is controlled by or | ||||||
21 | under common control with another business if the second | ||||||
22 | business (i) does not derive or project to derive 15% or more | ||||||
23 | of its annual revenue from the rental or sale of real estate | ||||||
24 | and (ii) is the primary tenant of the real estate leased from | ||||||
25 | the initial business. A business shall be considered a | ||||||
26 | qualified active low-income community business for the |
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1 | duration of the qualified community development entity's | ||||||
2 | investment in or loan to the business if the entity reasonably | ||||||
3 | expects, at the time it makes the investment or loan, that the | ||||||
4 | business will continue to satisfy the requirements for being a | ||||||
5 | qualified active low-income community business throughout the | ||||||
6 | entire period of the investment or loan. | ||||||
7 | "Qualified community development entity" has the meaning | ||||||
8 | given to that term in Section 45D of the Internal Revenue Code | ||||||
9 | of 1986, as amended; provided that such entity has entered | ||||||
10 | into, or is controlled by an entity that has entered into, an | ||||||
11 | allocation agreement with the Community Development Financial | ||||||
12 | Institutions Fund of the U.S. Treasury Department with respect | ||||||
13 | to credits authorized by Section 45D of the Internal Revenue | ||||||
14 | Code of 1986, as amended, that includes the State of Illinois | ||||||
15 | within the service area set forth in that allocation agreement. | ||||||
16 | "Qualified equity investment" means any equity investment | ||||||
17 | in, or long-term debt security issued by, a qualified community | ||||||
18 | development entity that:
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19 | (1) is acquired after the effective date of this Act at | ||||||
20 | its original issuance solely in exchange for cash; | ||||||
21 | (2) has at least 85% of its cash purchase price used by | ||||||
22 | the issuer to make qualified low-income community | ||||||
23 | investments in the State of Illinois; and | ||||||
24 | (3) is designated by the issuer as a qualified equity | ||||||
25 | investment under this
Act and is certified by the | ||||||
26 | Department as not exceeding the limitation contained in |
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1 | Section 20. | ||||||
2 | This term includes any qualified equity investment that | ||||||
3 | does not meet the provisions of item (1) of this definition if | ||||||
4 | the investment was a qualified equity investment in the hands | ||||||
5 | of a prior holder. | ||||||
6 | "Qualified low-income community investment" means any | ||||||
7 | capital or equity investment in, or loan to, any qualified | ||||||
8 | active low-income community business. With respect to any one | ||||||
9 | qualified active low-income community business, the maximum | ||||||
10 | amount of qualified low-income community investments made in | ||||||
11 | that business, on a collective basis with all of its affiliates | ||||||
12 | that may be counted towards the satisfaction of paragraph (2) | ||||||
13 | of the definition of qualified equity investment, shall be | ||||||
14 | $10,000,000 whether issued to one or several qualified | ||||||
15 | community development entities. | ||||||
16 | "Tax credit" means a credit against any income, franchise, | ||||||
17 | or insurance premium taxes otherwise due under Illinois law.
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18 | "Taxpayer" means any individual or entity subject to any | ||||||
19 | income, franchise, or insurance premium tax under Illinois law. | ||||||
20 | Section 10. Credit established. A person or entity that | ||||||
21 | makes a qualified equity investment earns a vested right to tax | ||||||
22 | credits as follows: | ||||||
23 | (1) on each credit allowance date of the qualified | ||||||
24 | equity investment, the purchaser of the qualified equity | ||||||
25 | investment, or subsequent holder of the qualified equity |
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1 | investment, is entitled to a tax credit during the taxable | ||||||
2 | year including that credit allowance date; | ||||||
3 | (2) the tax credit amount shall be equal to the | ||||||
4 | applicable percentage for such credit allowance date | ||||||
5 | multiplied by the purchase price paid to the issuer of the | ||||||
6 | qualified equity investment; and | ||||||
7 | (3) the amount of the tax credit claimed shall not | ||||||
8 | exceed the amount of the State tax liability of the holder, | ||||||
9 | or the person or entity to whom the credit is allocated for | ||||||
10 | use pursuant to Section 15, for the tax year for which the | ||||||
11 | tax credit is claimed. | ||||||
12 | A company doing insurance business in this State claiming a | ||||||
13 | tax credit against insurance premium taxes payable pursuant to | ||||||
14 | Section 409 of the Illinois Insurance Code is not required to | ||||||
15 | pay any additional retaliatory tax imposed pursuant to Section | ||||||
16 | 444 or 444.1 of the Illinois Insurance Code related to that | ||||||
17 | claim for a tax credit. | ||||||
18 | Section 15. Transferability. No tax credit claimed under | ||||||
19 | this Act shall be refundable or saleable on the open market. | ||||||
20 | Tax credits earned by a partnership, limited liability company, | ||||||
21 | S corporation, or other "pass-through" entity may be allocated | ||||||
22 | to the partners, members, or shareholders of that entity for | ||||||
23 | their direct use in accordance with the provisions of any | ||||||
24 | agreement among the partners, members, or shareholders. Any | ||||||
25 | amount of tax credit that the taxpayer, or partner, member, or |
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1 | shareholder thereof, is prohibited from claiming in a taxable | ||||||
2 | year may be carried forward to any of the taxpayer's 5 | ||||||
3 | subsequent taxable years. | ||||||
4 | Section 20. Annual cap on credits. The Department shall | ||||||
5 | limit the monetary amount of qualified equity investments | ||||||
6 | permitted under this Act to a level necessary to limit tax | ||||||
7 | credit use at no more than $10,000,000 of tax credits in any | ||||||
8 | fiscal year. This limitation on qualified equity investments | ||||||
9 | shall be based on the anticipated use of credits without regard | ||||||
10 | to the potential for taxpayers to carry forward tax credits to | ||||||
11 | later tax years. | ||||||
12 | Section 25. Certification of qualified equity investments. | ||||||
13 | (a) A qualified community development entity that seeks to | ||||||
14 | have an equity investment or long-term debt security designated | ||||||
15 | as a qualified equity investment and eligible for tax credits | ||||||
16 | under this Section shall apply to the Department. The qualified | ||||||
17 | community development entity must submit an application on a | ||||||
18 | form that the Department provides that includes: | ||||||
19 | (1) The name, address, tax identification number of the | ||||||
20 | entity, and evidence of the entity's certification as a | ||||||
21 | qualified community development entity. | ||||||
22 | (2) A copy of the allocation agreement executed by the | ||||||
23 | entity, or its controlling entity, and the Community | ||||||
24 | Development Financial Institutions Fund. |
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1 | (3) A certificate executed by an executive officer of | ||||||
2 | the entity attesting that the allocation agreement remains | ||||||
3 | in effect and has not been revoked or cancelled by the | ||||||
4 | Community Development Financial Institutions Fund. | ||||||
5 | (4) A description of the proposed amount, structure, | ||||||
6 | and purchaser of the equity investment or long-term debt | ||||||
7 | security. | ||||||
8 | (5) The name and tax identification number of any | ||||||
9 | taxpayer eligible to utilize tax credits earned as a result | ||||||
10 | of the issuance of the qualified equity investment. | ||||||
11 | (6) Information regarding the proposed use of proceeds | ||||||
12 | from the issuance of the qualified equity investment. | ||||||
13 | (7) A nonrefundable application fee of $5,000. This fee | ||||||
14 | shall be paid to the Department and shall be required of | ||||||
15 | each application submitted. | ||||||
16 | (b) Within 30 days after receipt of a completed application | ||||||
17 | containing the information necessary for the Department to | ||||||
18 | certify a potential qualified equity investment, including the | ||||||
19 | payment of the application fee, the Department shall grant or | ||||||
20 | deny the application in full or in part. If the Department | ||||||
21 | denies any part of the application, it shall inform the | ||||||
22 | qualified community development entity of the grounds for the | ||||||
23 | denial. If the qualified community development entity provides | ||||||
24 | any additional information required by the Department or | ||||||
25 | otherwise completes its application within 15 days of the | ||||||
26 | notice of denial, the application shall be considered completed |
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1 | as of the original date of submission. If the qualified | ||||||
2 | community development entity fails to provide the information | ||||||
3 | or complete its application within the 15-day period, the | ||||||
4 | application remains denied and must be resubmitted in full with | ||||||
5 | a new submission date. | ||||||
6 | (c) If the application is deemed complete, the Department | ||||||
7 | shall certify the proposed equity investment or long-term debt | ||||||
8 | security as a qualified equity investment that is eligible for | ||||||
9 | tax credits under this Section, subject to the limitations | ||||||
10 | contained in Section 20. The Department shall provide written | ||||||
11 | notice of the certification to the qualified community | ||||||
12 | development entity. The notice shall include the names of those | ||||||
13 | taxpayers who are eligible to utilize the credits and their | ||||||
14 | respective credit amounts. If the names of the taxpayers who | ||||||
15 | are eligible to utilize the credits change due to a transfer of | ||||||
16 | a qualified equity investment or a change in an allocation | ||||||
17 | pursuant to Section 15, the qualified community development | ||||||
18 | entity shall notify the Department of such change. | ||||||
19 | (d) The Department shall certify qualified equity | ||||||
20 | investments in the order applications are received by the | ||||||
21 | Department. Applications received on the same day shall be | ||||||
22 | deemed to have been received simultaneously. For applications | ||||||
23 | received on the same day and deemed complete, the Department | ||||||
24 | shall certify, consistent with remaining tax credit capacity, | ||||||
25 | qualified equity investments in proportionate percentages | ||||||
26 | based upon the ratio of the amount of qualified equity |
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1 | investment requested in an application to the total amount of | ||||||
2 | qualified equity investments requested in all applications | ||||||
3 | received on the same day. | ||||||
4 | (e) Once the Department has certified qualified equity | ||||||
5 | investments that, on a cumulative basis, are eligible for | ||||||
6 | $10,000,000 in tax credits, the Department may not certify any | ||||||
7 | more qualified equity investments. If a pending request cannot | ||||||
8 | be fully certified, the Department shall certify the portion | ||||||
9 | that may be certified unless the qualified community | ||||||
10 | development entity elects to withdraw its request rather than | ||||||
11 | receive partial credit. | ||||||
12 | (f) Within 30 days after receiving notice of certification, | ||||||
13 | the qualified community development entity shall issue the | ||||||
14 | qualified equity investment and receive cash in the amount of | ||||||
15 | the certified amount. The qualified community development | ||||||
16 | entity must provide the Department with evidence of the receipt | ||||||
17 | of the cash investment within 10 business days after receipt. | ||||||
18 | If the qualified community development entity does not receive | ||||||
19 | the cash investment and issue the qualified equity investment | ||||||
20 | within 30 days following receipt of the certification notice, | ||||||
21 | the certification shall lapse and the entity may not issue the | ||||||
22 | qualified equity investment without reapplying to the | ||||||
23 | Department for certification. A certification that lapses | ||||||
24 | reverts back to the Department and may be reissued only in | ||||||
25 | accordance with the application process outline in this Section | ||||||
26 | 25. |
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1 | Section 40. Recapture. The Department of Revenue shall | ||||||
2 | recapture, from the taxpayer that claimed the credit on a | ||||||
3 | return, the tax credit allowed under this Act if: | ||||||
4 | (1) any amount of the federal tax credit available with | ||||||
5 | respect to a qualified equity investment that is eligible | ||||||
6 | for a tax credit under this Act is recaptured under Section | ||||||
7 | 45D of the Internal Revenue Code of 1986, as amended. In | ||||||
8 | that case, the Department of Revenue's recapture shall be | ||||||
9 | proportionate to the federal recapture with respect to that | ||||||
10 | qualified equity investment; | ||||||
11 | (2) the issuer redeems or makes principal repayment | ||||||
12 | with respect to a qualified equity investment prior to the | ||||||
13 | 7th anniversary of the issuance of the qualified equity | ||||||
14 | investment. In that case, the Department of Revenue's | ||||||
15 | recapture shall be proportionate to the amount of the | ||||||
16 | redemption or repayment with respect to the qualified | ||||||
17 | equity investment; or | ||||||
18 | (3) the issuer fails to invest at least 85% of the cash | ||||||
19 | purchase price of the qualified equity investment in | ||||||
20 | qualified low-income community investments in the State of | ||||||
21 | Illinois within 12 months of the issuance of the qualified | ||||||
22 | equity investment and maintain such level of investment in | ||||||
23 | qualified low-income community investments in Illinois | ||||||
24 | until the last credit allowance date for such qualified | ||||||
25 | equity investment. |
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1 | For purposes of this Section, an investment shall be | ||||||
2 | considered held by an issuer even if the investment has been | ||||||
3 | sold or repaid; provided that the issuer reinvests an amount | ||||||
4 | equal to the capital returned to or recovered by the issuer | ||||||
5 | from the original investment, exclusive of any profits | ||||||
6 | realized, in another qualified low-income community investment | ||||||
7 | in this State within 12 months after the receipt of that | ||||||
8 | capital. An issuer is not required to reinvest capital returned | ||||||
9 | from qualified low-income community investments after the 6th | ||||||
10 | anniversary of the issuance of the qualified equity investment, | ||||||
11 | the proceeds of which were used to make the qualified | ||||||
12 | low-income community investment, and the qualified low-income | ||||||
13 | community investment shall be considered held by the issuer | ||||||
14 | through the 7th anniversary of the qualified equity | ||||||
15 | investment's issuance. | ||||||
16 | The Department of Revenue shall provide notice to the | ||||||
17 | qualified community development entity of any proposed | ||||||
18 | recapture of tax credits pursuant to this Section. The entity | ||||||
19 | shall have 90 days to cure any deficiency indicated in the | ||||||
20 | Department of Revenue's original recapture notice and avoid | ||||||
21 | such recapture. If the entity fails or is unable to cure such | ||||||
22 | deficiency with the 90-day period, the Department of Revenue | ||||||
23 | shall provide the entity and the taxpayer from whom the credit | ||||||
24 | is to be recaptured with a final order of recapture. Any tax | ||||||
25 | credit for which a final recapture order has been issued shall | ||||||
26 | be recaptured by the Department of Revenue from the taxpayer |
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1 | who claimed the tax credit on a tax return. | ||||||
2 | Section 45. Examination and Rulemaking. | ||||||
3 | (a) The Department may conduct examinations to verify that | ||||||
4 | the tax credits under this Act have been received and applied | ||||||
5 | according to the requirements of this Act and to verify that no | ||||||
6 | event has occurred that would result in a recapture of tax | ||||||
7 | credits under Section 40. | ||||||
8 | (b) Neither the Department nor the Department of Revenue | ||||||
9 | shall have the authority to promulgate rules under the Act, but | ||||||
10 | the Department and the Department of Revenue shall have the | ||||||
11 | authority to issue advisory letters to individual qualified | ||||||
12 | community development entities and their investors that are | ||||||
13 | limited to the specific facts outlined in an advisory letter | ||||||
14 | request from a qualified community development entity. Such | ||||||
15 | rulings cannot be relied upon by any person or entity other | ||||||
16 | than the qualified community development entity that requested | ||||||
17 | the letter and the taxpayers that are entitled to any tax | ||||||
18 | credits generated from investments in such entity. For purposes | ||||||
19 | of this subsection, "rules" is given the meaning contained in | ||||||
20 | Section 1-70 of the Illinois Administrative Procedure Act. | ||||||
21 | (c) In rendering advisory letters and making other | ||||||
22 | determinations under this Act, to the extent applicable, the | ||||||
23 | Department and the Department of Revenue shall look for | ||||||
24 | guidance to Section 45D of the Internal Revenue Code of 1986, | ||||||
25 | as amended, and the rules and regulations issued thereunder. |
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1 | Section 50. Sunset. For fiscal years following fiscal year | ||||||
2 | 2012, qualified equity investments shall not be made under this | ||||||
3 | Act unless reauthorization is made pursuant to this Section. | ||||||
4 | For all fiscal years following fiscal year 2012, unless the | ||||||
5 | General Assembly adopts a joint resolution granting authority | ||||||
6 | to the Department to approve qualified equity investments for | ||||||
7 | the Illinois new markets development program and clearly | ||||||
8 | describing the amount of tax credits available for the next | ||||||
9 | fiscal year, or otherwise complies with the provisions of this | ||||||
10 | Section, no qualified equity investments may be permitted to be | ||||||
11 | made under this Act. The amount of available tax credits | ||||||
12 | contained in such a resolution shall not exceed the limitation | ||||||
13 | provided under Section 20. Nothing in this Section precludes a | ||||||
14 | taxpayer who makes a qualified equity investment prior to the | ||||||
15 | expiration of authority to make qualified equity investments | ||||||
16 | from claiming tax credits relating to that qualified equity | ||||||
17 | investment for each applicable credit allowance date. | ||||||
18 | Section 75. The Illinois Insurance Code is amended by | ||||||
19 | changing Sections 409, 444, and 444.1 as follows:
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20 | (215 ILCS 5/409) (from Ch. 73, par. 1021)
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21 | Sec. 409. Annual privilege tax payable by
companies.
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22 | (1) As of January 1, 1999 for all health maintenance | ||||||
23 | organization premiums
written; as of July 1, 1998 for all |
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1 | premiums written as accident and health
business, voluntary | ||||||
2 | health service plan business, dental service plan business,
or | ||||||
3 | limited health service organization business; and as of January | ||||||
4 | 1, 1998
for all other types of insurance premiums written, | ||||||
5 | every company doing any form
of insurance business in this
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6 | State, including, but not limited to, every risk retention | ||||||
7 | group, and excluding
all fraternal benefit societies, all farm | ||||||
8 | mutual companies, all religious
charitable risk pooling | ||||||
9 | trusts, and excluding all statutory residual market and
special | ||||||
10 | purpose entities in which companies are statutorily required to
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11 | participate, whether incorporated or otherwise, shall pay, for | ||||||
12 | the privilege of
doing business in this State, to the Director | ||||||
13 | for the State treasury a State
tax equal to 0.5% of the net | ||||||
14 | taxable premium written, together with any amounts
due under | ||||||
15 | Section 444 of this Code, except that the tax to be paid on any
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16 | premium derived from any accident and health insurance or on | ||||||
17 | any insurance
business written by any company operating as a | ||||||
18 | health maintenance organization,
voluntary health service | ||||||
19 | plan, dental service plan, or limited health service
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20 | organization shall be equal to 0.4% of such net taxable premium | ||||||
21 | written,
together with any amounts due under Section 444. Upon | ||||||
22 | the failure of any
company to pay any such tax due, the | ||||||
23 | Director may, by order, revoke or
suspend the company's | ||||||
24 | certificate of authority after giving 20 days written
notice to | ||||||
25 | the company, or commence proceedings for the suspension of | ||||||
26 | business
in this State under the procedures set forth by |
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1 | Section 401.1 of this Code.
The gross taxable premium written | ||||||
2 | shall be the gross amount of premiums
received on direct | ||||||
3 | business during the calendar year on contracts covering
risks | ||||||
4 | in this State, except premiums on annuities, premiums on which | ||||||
5 | State
premium taxes are prohibited by federal law, premiums | ||||||
6 | paid by the State for
health care coverage for Medicaid | ||||||
7 | eligible insureds as described in Section
5-2 of the Illinois | ||||||
8 | Public Aid Code, premiums paid for health care services
| ||||||
9 | included as an element of tuition charges at any university or | ||||||
10 | college owned
and operated by the State of Illinois, premiums | ||||||
11 | on group insurance contracts
under the State Employees Group | ||||||
12 | Insurance Act of 1971, and except premiums for
deferred | ||||||
13 | compensation plans for employees of the State, units of local
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14 | government, or school districts. The net taxable premium shall | ||||||
15 | be the gross
taxable premium written reduced only by the | ||||||
16 | following:
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17 | (a) the amount of premiums returned thereon which shall | ||||||
18 | be limited to
premiums returned during the same preceding | ||||||
19 | calendar year and shall not include
the return of cash | ||||||
20 | surrender values or death benefits on life policies
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21 | including annuities;
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22 | (b) dividends on such direct business that have been | ||||||
23 | paid in cash, applied
in reduction of premiums or left to | ||||||
24 | accumulate to the credit of policyholders
or annuitants. In | ||||||
25 | the case of life insurance, no deduction shall be made for
| ||||||
26 | the payment of deferred dividends paid in cash to |
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1 | policyholders on maturing
policies; dividends left to | ||||||
2 | accumulate to the credit of policyholders or
annuitants | ||||||
3 | shall be included as gross taxable premium written when | ||||||
4 | such
dividend
accumulations are applied to purchase | ||||||
5 | paid-up insurance or to shorten the
endowment or premium | ||||||
6 | paying period.
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7 | (2) The annual privilege tax payment due from a company | ||||||
8 | under subsection (4)
of
this Section may be reduced by: (a) the | ||||||
9 | excess amount, if any, by which the
aggregate income taxes paid | ||||||
10 | by the company, on a cash basis, for the preceding
calendar | ||||||
11 | year under subsections (a) through (d) of Section 201 of the | ||||||
12 | Illinois
Income Tax Act exceed 1.5% of the company's net | ||||||
13 | taxable premium written for
that prior calendar year, as | ||||||
14 | determined under subsection (1) of this Section;
and (b) the | ||||||
15 | amount of any fire department taxes paid by the company during | ||||||
16 | the
preceding calendar year under Section 11-10-1 of the | ||||||
17 | Illinois Municipal Code.
Any deductible amount or offset | ||||||
18 | allowed under items (a) and (b) of this
subsection for any | ||||||
19 | calendar year will not be allowed as a deduction or offset
| ||||||
20 | against the company's privilege tax liability for any other | ||||||
21 | taxing period or
calendar year.
| ||||||
22 | (3) If a company survives or was formed by a merger, | ||||||
23 | consolidation,
reorganization, or reincorporation, the | ||||||
24 | premiums received and amounts returned
or paid by all companies | ||||||
25 | party to the merger, consolidation, reorganization,
or | ||||||
26 | reincorporation shall, for purposes of determining the amount |
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1 | of the tax
imposed by this Section, be regarded as received, | ||||||
2 | returned, or paid by the
surviving
or new company.
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3 | (4)(a) All companies subject to the provisions of this | ||||||
4 | Section shall make an
annual return for the preceding calendar | ||||||
5 | year on or before March 15 setting
forth such information on | ||||||
6 | such forms as the Director may reasonably require.
Payments of | ||||||
7 | quarterly installments of the taxpayer's total estimated tax | ||||||
8 | for
the current calendar year shall be due on or before April | ||||||
9 | 15, June 15,
September 15, and December 15 of such year, except | ||||||
10 | that all companies
transacting insurance in this State whose | ||||||
11 | annual tax for the immediately
preceding calendar year was less | ||||||
12 | than $5,000 shall make only an annual return.
Failure of a | ||||||
13 | company to make the annual payment, or to make the quarterly
| ||||||
14 | payments, if required, of at least 25% of either (i) the total | ||||||
15 | tax paid during
the
previous calendar year or (ii) 80% of the | ||||||
16 | actual tax for the current calendar
year shall subject it to | ||||||
17 | the penalty provisions set forth in Section 412 of
this Code.
| ||||||
18 | (b) Notwithstanding the foregoing provisions, no annual | ||||||
19 | return shall be
required or made on March 15, 1998, under this | ||||||
20 | subsection. For the calendar
year 1998:
| ||||||
21 | (i) each health maintenance organization shall have no | ||||||
22 | estimated tax
installments;
| ||||||
23 | (ii) all companies subject to the tax as of July 1, | ||||||
24 | 1998 as
set forth in subsection (1) shall have estimated | ||||||
25 | tax installments due on
September
15 and December 15 of | ||||||
26 | 1998 which
installments shall each amount to no less than |
| |||||||
| |||||||
1 | one-half of 80% of the actual
tax on its net taxable | ||||||
2 | premium written during the period July 1, 1998, through
| ||||||
3 | December 31, 1998; and
| ||||||
4 | (iii) all other companies shall have estimated tax | ||||||
5 | installments due on
June
15, September 15, and December 15 | ||||||
6 | of 1998 which installments shall each
amount to no less | ||||||
7 | than one-third of 80% of the actual tax on its net taxable
| ||||||
8 | premium written during the calendar year 1998.
| ||||||
9 | In the year 1999 and thereafter all companies shall make | ||||||
10 | annual and
quarterly installments of their estimated tax as | ||||||
11 | provided by paragraph (a) of
this subsection.
| ||||||
12 | (5) In addition to the authority specifically granted under | ||||||
13 | Article XXV of
this Code, the Director shall have such | ||||||
14 | authority to adopt rules and establish
forms as may be | ||||||
15 | reasonably necessary
for purposes of determining the | ||||||
16 | allocation of Illinois corporate income taxes
paid under | ||||||
17 | subsections (a) through (d) of Section 201 of the Illinois | ||||||
18 | Income
Tax Act amongst members of a business group that files | ||||||
19 | an Illinois corporate
income tax return on a unitary basis, for | ||||||
20 | purposes of regulating the amendment
of tax returns, for | ||||||
21 | purposes of defining terms, and for purposes of enforcing
the | ||||||
22 | provisions of
Article XXV of
this Code. The Director shall also | ||||||
23 | have authority to defer, waive, or abate
the tax
imposed by | ||||||
24 | this Section if in his opinion the company's solvency and | ||||||
25 | ability to
meet its insured obligations would be immediately | ||||||
26 | threatened by payment of the
tax due.
|
| |||||||
| |||||||
1 | (c) This Section is subject to the provisions of Section 10 | ||||||
2 | of the New Markets Development Program Act. | ||||||
3 | (Source: P.A. 90-583, eff. 5-29-98.)
| ||||||
4 | (215 ILCS 5/444) (from Ch. 73, par. 1056)
| ||||||
5 | Sec. 444. Retaliation.
| ||||||
6 | (1) Whenever the existing or future laws of any other state | ||||||
7 | or country
shall
require of companies incorporated or organized | ||||||
8 | under the laws of this State
as a condition precedent to their | ||||||
9 | doing business in such other state or
country, compliance with | ||||||
10 | laws, rules, regulations, and prohibitions more
onerous or | ||||||
11 | burdensome than the rules and regulations imposed by this State
| ||||||
12 | on foreign or alien companies, or shall require any deposit of | ||||||
13 | securities
or other obligations in such state or country, for | ||||||
14 | the protection of
policyholders or otherwise or require of such | ||||||
15 | companies or agents thereof
or brokers the payment of | ||||||
16 | penalties, fees, charges, or taxes greater than
the penalties, | ||||||
17 | fees, charges, or taxes required in the aggregate for like
| ||||||
18 | purposes by this Code or any other law of this State, of | ||||||
19 | foreign or alien
companies, agents thereof or brokers, then | ||||||
20 | such laws, rules, regulations,
and prohibitions of said other | ||||||
21 | state or country shall apply to companies
incorporated or | ||||||
22 | organized under the laws of such state or country doing
| ||||||
23 | business in this State, and all such companies, agents thereof, | ||||||
24 | or brokers
doing business in this State, shall be required to | ||||||
25 | make deposits, pay
penalties, fees, charges, and taxes, in |
| |||||||
| |||||||
1 | amounts equal to those required in
the aggregate for like | ||||||
2 | purposes of Illinois companies doing business in
such state or | ||||||
3 | country, agents thereof or brokers. Whenever any other state
or | ||||||
4 | country shall refuse to permit any insurance company | ||||||
5 | incorporated or
organized under the laws of this State to | ||||||
6 | transact business according to
its usual plan in such other | ||||||
7 | state or country, the director may, if
satisfied that such | ||||||
8 | company of this State is solvent, properly managed, and
can | ||||||
9 | operate legally under the laws of such other state or country,
| ||||||
10 | forthwith suspend or cancel the license of every insurance | ||||||
11 | company doing
business in this State which is incorporated or | ||||||
12 | organized under the laws of
such other state or country to the | ||||||
13 | extent that it insures in this State
against any of the risks | ||||||
14 | or hazards which are sought to be insured against
by the | ||||||
15 | company of this State in such other state or country.
| ||||||
16 | (2) The provisions of this Section shall not apply to | ||||||
17 | residual market
or special purpose assessments or guaranty fund | ||||||
18 | or guaranty association
assessments, both under the laws of | ||||||
19 | this State and under the laws of any other
state
or country, | ||||||
20 | and any tax offset or credit for any such assessment shall, for
| ||||||
21 | purposes of this Section, be treated as a tax paid both under | ||||||
22 | the laws of this
State and under the laws of any other state or | ||||||
23 | country.
| ||||||
24 | (3) The terms "penalties", "fees", "charges", and "taxes" | ||||||
25 | in subsection
(1) of this
Section
shall include: the penalties, | ||||||
26 | fees, charges, and taxes collected under State
law
and
|
| |||||||
| |||||||
1 | referenced within Article XXV exclusive of any items referenced | ||||||
2 | by
subsection
(2) of this Section, but including any tax offset | ||||||
3 | allowed under Section 531.13
of this Code; the Illinois | ||||||
4 | corporate income taxes imposed under
subsections (a) through | ||||||
5 | (d) of Section 201 of the Illinois Income Tax Act after
any tax | ||||||
6 | offset allowed under Section 531.13 of this Code;
income or | ||||||
7 | personal property taxes imposed by other states or countries;
| ||||||
8 | penalties, fees, charges, and taxes of other states
or | ||||||
9 | countries imposed for purposes like those of the penalties, | ||||||
10 | fees, charges,
and taxes
specified in Article XXV of this Code | ||||||
11 | exclusive of any item referenced in
subsection (2) of this | ||||||
12 | Section; and any penalties, fees, charges, and taxes
required | ||||||
13 | as
a
franchise, privilege, or licensing tax for
conducting the | ||||||
14 | business of insurance whether calculated as a percentage of
| ||||||
15 | income, gross receipts, premium, or otherwise.
| ||||||
16 | (4) Nothing contained in this Section or Section 409 or | ||||||
17 | Section 444.1 is
intended to authorize or expand any power of | ||||||
18 | local governmental units or
municipalities to impose taxes, | ||||||
19 | fees, or charges.
| ||||||
20 | (5) This Section is subject to the provisions of Section 10 | ||||||
21 | of the New Markets Development Program Act. | ||||||
22 | (Source: P.A. 90-583, eff. 5-29-98.)
| ||||||
23 | (215 ILCS 5/444.1) (from Ch. 73, par. 1056.1)
| ||||||
24 | Sec. 444.1. Payment of retaliatory taxes.
| ||||||
25 | (1) Every foreign or alien
company doing insurance business |
| |||||||
| |||||||
1 | in this State shall pay the Director the
retaliatory tax | ||||||
2 | determined in accordance with Section 444.
| ||||||
3 | (2) (a) All companies subject to the provisions of this | ||||||
4 | Section shall
make an
annual return for the preceding calendar | ||||||
5 | year on or before March 15 setting
forth such information on | ||||||
6 | such forms as the Director may reasonably require.
Payments of | ||||||
7 | quarterly installments of the taxpayer's total estimated
| ||||||
8 | retaliatory tax for the current calendar year shall be due on | ||||||
9 | or before April
15, June 15, September 15, and December 15 of | ||||||
10 | such year, except that all
companies
transacting insurance | ||||||
11 | business in this State whose annual tax for the
immediately
| ||||||
12 | preceding calendar year was less than $5,000 shall make only an | ||||||
13 | annual
return. Failure of a company to make the annual payment, | ||||||
14 | or to make the
quarterly payments, if required, of at least | ||||||
15 | one-fourth of either (i) the total
tax paid during the previous | ||||||
16 | calendar year or (ii) 80% of the actual tax for
the current | ||||||
17 | calendar year shall subject it to the penalty provisions set | ||||||
18 | forth
in Section 412 of this Code.
| ||||||
19 | (b) Notwithstanding the foregoing provisions of paragraph | ||||||
20 | (a) of this
subsection, the retaliatory tax liability of | ||||||
21 | companies under Section 444 of
this Code for the calendar year | ||||||
22 | ended December 31, 1997 shall be
determined in accordance with | ||||||
23 | this amendatory Act of 1998 and shall include in
the aggregate | ||||||
24 | comparative tax burden for the State of Illinois, any tax | ||||||
25 | offset
allowed under Section 531.13 of this Code and any income
| ||||||
26 | taxes paid for the year 1997 under subsections (a) through (d) |
| |||||||
| |||||||
1 | of Section 201
of the Illinois Income Tax Act after any tax | ||||||
2 | offset allowed under Section
531.13 of this Code.
| ||||||
3 | (i) Any annual retaliatory tax returns and payments | ||||||
4 | made for the year
ended December 31, 1997 and any quarterly | ||||||
5 | installments of the taxpayer's total
estimated 1998 | ||||||
6 | retaliatory tax liability paid prior to the effective date | ||||||
7 | of
this Amendatory Act of 1998 that do not include the | ||||||
8 | items specified by
subsection (1) of this Section shall be | ||||||
9 | amended and restated, at the taxpayer's
election, on forms
| ||||||
10 | prepared by the Director so as to provide for the
inclusion | ||||||
11 | of such items.
An amended and restated return for the year | ||||||
12 | ended December 31, 1997 filed under
this subparagraph shall | ||||||
13 | treat any payment of estimated privilege taxes under
| ||||||
14 | Section 409 as in effect prior to October 23, 1997 as a | ||||||
15 | payment of estimated
retaliatory taxes for the year ended | ||||||
16 | December 31, 1997.
| ||||||
17 | (ii) Any overpayment resulting from such amended | ||||||
18 | return and restated tax
liability shall be allowed as a | ||||||
19 | credit against any subsequent privilege or
retaliatory tax | ||||||
20 | obligations of the taxpayer.
| ||||||
21 | (iii) In the year 1999 and thereafter all companies | ||||||
22 | shall make annual and
quarterly installments of their | ||||||
23 | estimated tax as provided by paragraph
(a) of this | ||||||
24 | subsection.
| ||||||
25 | (3) Any tax payment made under this Section and any tax | ||||||
26 | returns prepared
in compliance with Section 410 shall give full |
| |||||||
| |||||||
1 | consideration to the impact
of any future reduction in or | ||||||
2 | elimination of a taxpayer's liability under
Section 409, | ||||||
3 | whether such reduction or elimination is due to an operation
of | ||||||
4 | law or an Act of the General Assembly.
| ||||||
5 | (4) Any foreign or alien taxpayer who makes, under protest, | ||||||
6 | a tax payment
required by Section 409 shall, at the time of | ||||||
7 | payment, file a retaliatory
tax return sufficient to disclose | ||||||
8 | the full amount of retaliatory taxes which
would be due and | ||||||
9 | owing for the tax period in question if the protest were
| ||||||
10 | upheld. Notwithstanding the provisions of the State Officers | ||||||
11 | and Employees
Money Disposition Act or any other laws of this | ||||||
12 | State, the protested
payment, to the extent of the retaliatory | ||||||
13 | tax so disclosed, shall be deposited
directly in the General | ||||||
14 | Revenue Fund; and the balance of the payment, if
any, shall be | ||||||
15 | deposited in a protest account pursuant to the provisions
of | ||||||
16 | the aforesaid Act, as now or hereafter amended.
| ||||||
17 | (5) The failure of a company to make the annual payment or | ||||||
18 | to make the
quarterly payments, if required,
of at least | ||||||
19 | one-fourth of either (i) the total tax paid
during the | ||||||
20 | preceding
calendar year or (ii) 80% of the actual tax for the | ||||||
21 | current calendar
year shall subject it to the penalty | ||||||
22 | provisions set forth in Section
412 of this Code.
| ||||||
23 | (6) This Section is subject to the provisions of Section 10 | ||||||
24 | of the New Markets Development Program Act. | ||||||
25 | (Source: P.A. 90-583, eff. 5-29-98.)
| ||||||
26 | Section 99. Effective date. This Act takes effect upon |
| |||||||
| |||||||
1 | becoming law.
|