Sen. Jeffrey M. Schoenberg

Filed: 4/29/2009

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 1739

2     AMENDMENT NO. ______. Amend Senate Bill 1739, AS AMENDED,
3 by replacing everything after the enacting clause with the
4 following:
 
5     "Section 5. The Illinois Income Tax Act is amended by
6 changing Section 304 as follows:
 
7     (35 ILCS 5/304)  (from Ch. 120, par. 3-304)
8     Sec. 304. Business income of persons other than residents.
9     (a) In general. The business income of a person other than
10 a resident shall be allocated to this State if such person's
11 business income is derived solely from this State. If a person
12 other than a resident derives business income from this State
13 and one or more other states, then, for tax years ending on or
14 before December 30, 1998, and except as otherwise provided by
15 this Section, such person's business income shall be
16 apportioned to this State by multiplying the income by a

 

 

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1 fraction, the numerator of which is the sum of the property
2 factor (if any), the payroll factor (if any) and 200% of the
3 sales factor (if any), and the denominator of which is 4
4 reduced by the number of factors other than the sales factor
5 which have a denominator of zero and by an additional 2 if the
6 sales factor has a denominator of zero. For tax years ending on
7 or after December 31, 1998, and except as otherwise provided by
8 this Section, persons other than residents who derive business
9 income from this State and one or more other states shall
10 compute their apportionment factor by weighting their
11 property, payroll, and sales factors as provided in subsection
12 (h) of this Section.
13     (1) Property factor.
14         (A) The property factor is a fraction, the numerator of
15     which is the average value of the person's real and
16     tangible personal property owned or rented and used in the
17     trade or business in this State during the taxable year and
18     the denominator of which is the average value of all the
19     person's real and tangible personal property owned or
20     rented and used in the trade or business during the taxable
21     year.
22         (B) Property owned by the person is valued at its
23     original cost. Property rented by the person is valued at 8
24     times the net annual rental rate. Net annual rental rate is
25     the annual rental rate paid by the person less any annual
26     rental rate received by the person from sub-rentals.

 

 

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1         (C) The average value of property shall be determined
2     by averaging the values at the beginning and ending of the
3     taxable year but the Director may require the averaging of
4     monthly values during the taxable year if reasonably
5     required to reflect properly the average value of the
6     person's property.
7     (2) Payroll factor.
8         (A) The payroll factor is a fraction, the numerator of
9     which is the total amount paid in this State during the
10     taxable year by the person for compensation, and the
11     denominator of which is the total compensation paid
12     everywhere during the taxable year.
13         (B) Compensation is paid in this State if:
14             (i) The individual's service is performed entirely
15         within this State;
16             (ii) The individual's service is performed both
17         within and without this State, but the service
18         performed without this State is incidental to the
19         individual's service performed within this State; or
20             (iii) Some of the service is performed within this
21         State and either the base of operations, or if there is
22         no base of operations, the place from which the service
23         is directed or controlled is within this State, or the
24         base of operations or the place from which the service
25         is directed or controlled is not in any state in which
26         some part of the service is performed, but the

 

 

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1         individual's residence is in this State.
2             (iv) Compensation paid to nonresident professional
3         athletes.
4             (a) General. The Illinois source income of a
5         nonresident individual who is a member of a
6         professional athletic team includes the portion of the
7         individual's total compensation for services performed
8         as a member of a professional athletic team during the
9         taxable year which the number of duty days spent within
10         this State performing services for the team in any
11         manner during the taxable year bears to the total
12         number of duty days spent both within and without this
13         State during the taxable year.
14             (b) Travel days. Travel days that do not involve
15         either a game, practice, team meeting, or other similar
16         team event are not considered duty days spent in this
17         State. However, such travel days are considered in the
18         total duty days spent both within and without this
19         State.
20             (c) Definitions. For purposes of this subpart
21         (iv):
22                 (1) The term "professional athletic team"
23             includes, but is not limited to, any professional
24             baseball, basketball, football, soccer, or hockey
25             team.
26                 (2) The term "member of a professional

 

 

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1             athletic team" includes those employees who are
2             active players, players on the disabled list, and
3             any other persons required to travel and who travel
4             with and perform services on behalf of a
5             professional athletic team on a regular basis.
6             This includes, but is not limited to, coaches,
7             managers, and trainers.
8                 (3) Except as provided in items (C) and (D) of
9             this subpart (3), the term "duty days" means all
10             days during the taxable year from the beginning of
11             the professional athletic team's official
12             pre-season training period through the last game
13             in which the team competes or is scheduled to
14             compete. Duty days shall be counted for the year in
15             which they occur, including where a team's
16             official pre-season training period through the
17             last game in which the team competes or is
18             scheduled to compete, occurs during more than one
19             tax year.
20                     (A) Duty days shall also include days on
21                 which a member of a professional athletic team
22                 performs service for a team on a date that does
23                 not fall within the foregoing period (e.g.,
24                 participation in instructional leagues, the
25                 "All Star Game", or promotional "caravans").
26                 Performing a service for a professional

 

 

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1                 athletic team includes conducting training and
2                 rehabilitation activities, when such
3                 activities are conducted at team facilities.
4                     (B) Also included in duty days are game
5                 days, practice days, days spent at team
6                 meetings, promotional caravans, preseason
7                 training camps, and days served with the team
8                 through all post-season games in which the team
9                 competes or is scheduled to compete.
10                     (C) Duty days for any person who joins a
11                 team during the period from the beginning of
12                 the professional athletic team's official
13                 pre-season training period through the last
14                 game in which the team competes, or is
15                 scheduled to compete, shall begin on the day
16                 that person joins the team. Conversely, duty
17                 days for any person who leaves a team during
18                 this period shall end on the day that person
19                 leaves the team. Where a person switches teams
20                 during a taxable year, a separate duty-day
21                 calculation shall be made for the period the
22                 person was with each team.
23                     (D) Days for which a member of a
24                 professional athletic team is not compensated
25                 and is not performing services for the team in
26                 any manner, including days when such member of

 

 

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1                 a professional athletic team has been
2                 suspended without pay and prohibited from
3                 performing any services for the team, shall not
4                 be treated as duty days.
5                     (E) Days for which a member of a
6                 professional athletic team is on the disabled
7                 list and does not conduct rehabilitation
8                 activities at facilities of the team, and is
9                 not otherwise performing services for the team
10                 in Illinois, shall not be considered duty days
11                 spent in this State. All days on the disabled
12                 list, however, are considered to be included in
13                 total duty days spent both within and without
14                 this State.
15                 (4) The term "total compensation for services
16             performed as a member of a professional athletic
17             team" means the total compensation received during
18             the taxable year for services performed:
19                     (A) from the beginning of the official
20                 pre-season training period through the last
21                 game in which the team competes or is scheduled
22                 to compete during that taxable year; and
23                     (B) during the taxable year on a date which
24                 does not fall within the foregoing period
25                 (e.g., participation in instructional leagues,
26                 the "All Star Game", or promotional caravans).

 

 

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1                 This compensation shall include, but is not
2             limited to, salaries, wages, bonuses as described
3             in this subpart, and any other type of compensation
4             paid during the taxable year to a member of a
5             professional athletic team for services performed
6             in that year. This compensation does not include
7             strike benefits, severance pay, termination pay,
8             contract or option year buy-out payments,
9             expansion or relocation payments, or any other
10             payments not related to services performed for the
11             team.
12                 For purposes of this subparagraph, "bonuses"
13             included in "total compensation for services
14             performed as a member of a professional athletic
15             team" subject to the allocation described in
16             Section 302(c)(1) are: bonuses earned as a result
17             of play (i.e., performance bonuses) during the
18             season, including bonuses paid for championship,
19             playoff or "bowl" games played by a team, or for
20             selection to all-star league or other honorary
21             positions; and bonuses paid for signing a
22             contract, unless the payment of the signing bonus
23             is not conditional upon the signee playing any
24             games for the team or performing any subsequent
25             services for the team or even making the team, the
26             signing bonus is payable separately from the

 

 

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1             salary and any other compensation, and the signing
2             bonus is nonrefundable.
3     (3) Sales factor.
4         (A) The sales factor is a fraction, the numerator of
5     which is the total sales of the person in this State during
6     the taxable year, and the denominator of which is the total
7     sales of the person everywhere during the taxable year.
8         (B) Sales of tangible personal property are in this
9     State if:
10             (i) The property is delivered or shipped to a
11         purchaser, other than the United States government,
12         within this State regardless of the f. o. b. point or
13         other conditions of the sale; or
14             (ii) The property is shipped from an office, store,
15         warehouse, factory or other place of storage in this
16         State and either the purchaser is the United States
17         government or the person is not taxable in the state of
18         the purchaser; provided, however, that premises owned
19         or leased by a person who has independently contracted
20         with the seller for the printing of newspapers,
21         periodicals or books shall not be deemed to be an
22         office, store, warehouse, factory or other place of
23         storage for purposes of this Section. Sales of tangible
24         personal property are not in this State if the seller
25         and purchaser would be members of the same unitary
26         business group but for the fact that either the seller

 

 

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1         or purchaser is a person with 80% or more of total
2         business activity outside of the United States and the
3         property is purchased for resale.
4         (B-1) Patents, copyrights, trademarks, and similar
5     items of intangible personal property.
6             (i) Gross receipts from the licensing, sale, or
7         other disposition of a patent, copyright, trademark,
8         or similar item of intangible personal property, other
9         than gross receipts governed by paragraph (B-7) of this
10         item (3), are in this State to the extent the item is
11         utilized in this State during the year the gross
12         receipts are included in gross income.
13             (ii) Place of utilization.
14                 (I) A patent is utilized in a state to the
15             extent that it is employed in production,
16             fabrication, manufacturing, or other processing in
17             the state or to the extent that a patented product
18             is produced in the state. If a patent is utilized
19             in more than one state, the extent to which it is
20             utilized in any one state shall be a fraction equal
21             to the gross receipts of the licensee or purchaser
22             from sales or leases of items produced,
23             fabricated, manufactured, or processed within that
24             state using the patent and of patented items
25             produced within that state, divided by the total of
26             such gross receipts for all states in which the

 

 

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1             patent is utilized.
2                 (II) A copyright is utilized in a state to the
3             extent that printing or other publication
4             originates in the state. If a copyright is utilized
5             in more than one state, the extent to which it is
6             utilized in any one state shall be a fraction equal
7             to the gross receipts from sales or licenses of
8             materials printed or published in that state
9             divided by the total of such gross receipts for all
10             states in which the copyright is utilized.
11                 (III) Trademarks and other items of intangible
12             personal property governed by this paragraph (B-1)
13             are utilized in the state in which the commercial
14             domicile of the licensee or purchaser is located.
15             (iii) If the state of utilization of an item of
16         property governed by this paragraph (B-1) cannot be
17         determined from the taxpayer's books and records or
18         from the books and records of any person related to the
19         taxpayer within the meaning of Section 267(b) of the
20         Internal Revenue Code, 26 U.S.C. 267, the gross
21         receipts attributable to that item shall be excluded
22         from both the numerator and the denominator of the
23         sales factor.
24         (B-2) Gross receipts from the license, sale, or other
25     disposition of patents, copyrights, trademarks, and
26     similar items of intangible personal property, other than

 

 

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1     gross receipts governed by paragraph (B-7) of this item
2     (3), may be included in the numerator or denominator of the
3     sales factor only if gross receipts from licenses, sales,
4     or other disposition of such items comprise more than 50%
5     of the taxpayer's total gross receipts included in gross
6     income during the tax year and during each of the 2
7     immediately preceding tax years; provided that, when a
8     taxpayer is a member of a unitary business group, such
9     determination shall be made on the basis of the gross
10     receipts of the entire unitary business group.
11         (B-5) For taxable years ending on or after December 31,
12     2008, except as provided in subsections (ii) through (vii),
13     receipts from the sale of telecommunications service or
14     mobile telecommunications service are in this State if the
15     customer's service address is in this State.
16             (i) For purposes of this subparagraph (B-5), the
17         follow terms have the following meanings:
18             "Ancillary services" means services that are
19         associated with or incidental to the provision of
20         "telecommunications services", including but not
21         limited to "detailed telecommunications billing",
22         "directory assistance", "vertical service", and "voice
23         mail services".
24             "Air-to-Ground Radiotelephone service" means a
25         radio service, as that term is defined in 47 CFR 22.99,
26         in which common carriers are authorized to offer and

 

 

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1         provide radio telecommunications service for hire to
2         subscribers in aircraft.
3             "Call-by-call Basis" means any method of charging
4         for telecommunications services where the price is
5         measured by individual calls.
6             "Communications Channel" means a physical or
7         virtual path of communications over which signals are
8         transmitted between or among customer channel
9         termination points.
10             "Conference bridging service" means an "ancillary
11         service" that links two or more participants of an
12         audio or video conference call and may include the
13         provision of a telephone number. "Conference bridging
14         service" does not include the "telecommunications
15         services" used to reach the conference bridge.
16             "Customer Channel Termination Point" means the
17         location where the customer either inputs or receives
18         the communications.
19             "Detailed telecommunications billing service"
20         means an "ancillary service" of separately stating
21         information pertaining to individual calls on a
22         customer's billing statement.
23             "Directory assistance" means an "ancillary
24         service" of providing telephone number information,
25         and/or address information.
26             "Home service provider" means the facilities based

 

 

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1         carrier or reseller with which the customer contracts
2         for the provision of mobile telecommunications
3         services.
4             "Mobile telecommunications service" means
5         commercial mobile radio service, as defined in Section
6         20.3 of Title 47 of the Code of Federal Regulations as
7         in effect on June 1, 1999.
8             "Place of primary use" means the street address
9         representative of where the customer's use of the
10         telecommunications service primarily occurs, which
11         must be the residential street address or the primary
12         business street address of the customer. In the case of
13         mobile telecommunications services, "place of primary
14         use" must be within the licensed service area of the
15         home service provider.
16             "Post-paid telecommunication service" means the
17         telecommunications service obtained by making a
18         payment on a call-by-call basis either through the use
19         of a credit card or payment mechanism such as a bank
20         card, travel card, credit card, or debit card, or by
21         charge made to a telephone number which is not
22         associated with the origination or termination of the
23         telecommunications service. A post-paid calling
24         service includes telecommunications service, except a
25         prepaid wireless calling service, that would be a
26         prepaid calling service except it is not exclusively a

 

 

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1         telecommunication service.
2             "Prepaid telecommunication service" means the
3         right to access exclusively telecommunications
4         services, which must be paid for in advance and which
5         enables the origination of calls using an access number
6         or authorization code, whether manually or
7         electronically dialed, and that is sold in
8         predetermined units or dollars of which the number
9         declines with use in a known amount.
10             "Prepaid Mobile telecommunication service" means a
11         telecommunications service that provides the right to
12         utilize mobile wireless service as well as other
13         non-telecommunication services, including but not
14         limited to ancillary services, which must be paid for
15         in advance that is sold in predetermined units or
16         dollars of which the number declines with use in a
17         known amount.
18             "Private communication service" means a
19         telecommunication service that entitles the customer
20         to exclusive or priority use of a communications
21         channel or group of channels between or among
22         termination points, regardless of the manner in which
23         such channel or channels are connected, and includes
24         switching capacity, extension lines, stations, and any
25         other associated services that are provided in
26         connection with the use of such channel or channels.

 

 

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1             "Service address" means:
2                 (a) The location of the telecommunications
3             equipment to which a customer's call is charged and
4             from which the call originates or terminates,
5             regardless of where the call is billed or paid;
6                 (b) If the location in line (a) is not known,
7             service address means the origination point of the
8             signal of the telecommunications services first
9             identified by either the seller's
10             telecommunications system or in information
11             received by the seller from its service provider
12             where the system used to transport such signals is
13             not that of the seller; and
14                 (c) If the locations in line (a) and line (b)
15             are not known, the service address means the
16             location of the customer's place of primary use.
17             "Telecommunications service" means the electronic
18         transmission, conveyance, or routing of voice, data,
19         audio, video, or any other information or signals to a
20         point, or between or among points. The term
21         "telecommunications service" includes such
22         transmission, conveyance, or routing in which computer
23         processing applications are used to act on the form,
24         code or protocol of the content for purposes of
25         transmission, conveyance or routing without regard to
26         whether such service is referred to as voice over

 

 

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1         Internet protocol services or is classified by the
2         Federal Communications Commission as enhanced or value
3         added. "Telecommunications service" does not include:
4                 (a) Data processing and information services
5             that allow data to be generated, acquired, stored,
6             processed, or retrieved and delivered by an
7             electronic transmission to a purchaser when such
8             purchaser's primary purpose for the underlying
9             transaction is the processed data or information;
10                 (b) Installation or maintenance of wiring or
11             equipment on a customer's premises;
12                 (c) Tangible personal property;
13                 (d) Advertising, including but not limited to
14             directory advertising.
15                 (e) Billing and collection services provided
16             to third parties;
17                 (f) Internet access service;
18                 (g) Radio and television audio and video
19             programming services, regardless of the medium,
20             including the furnishing of transmission,
21             conveyance and routing of such services by the
22             programming service provider. Radio and television
23             audio and video programming services shall include
24             but not be limited to cable service as defined in
25             47 USC 522(6) and audio and video programming
26             services delivered by commercial mobile radio

 

 

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1             service providers, as defined in 47 CFR 20.3;
2                 (h) "Ancillary services"; or
3                 (i) Digital products "delivered
4             electronically", including but not limited to
5             software, music, video, reading materials or ring
6             tones.
7             "Vertical service" means an "ancillary service"
8         that is offered in connection with one or more
9         "telecommunications services", which offers advanced
10         calling features that allow customers to identify
11         callers and to manage multiple calls and call
12         connections, including "conference bridging services".
13             "Voice mail service" means an "ancillary service"
14         that enables the customer to store, send or receive
15         recorded messages. "Voice mail service" does not
16         include any "vertical services" that the customer may
17         be required to have in order to utilize the "voice mail
18         service".
19             (ii) Receipts from the sale of telecommunications
20         service sold on an individual call-by-call basis are in
21         this State if either of the following applies:
22                 (a) The call both originates and terminates in
23             this State.
24                 (b) The call either originates or terminates
25             in this State and the service address is located in
26             this State.

 

 

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1             (iii) Receipts from the sale of postpaid
2         telecommunications service at retail are in this State
3         if the origination point of the telecommunication
4         signal, as first identified by the service provider's
5         telecommunication system or as identified by
6         information received by the seller from its service
7         provider if the system used to transport
8         telecommunication signals is not the seller's, is
9         located in this State.
10             (iv) Receipts from the sale of prepaid
11         telecommunications service or prepaid mobile
12         telecommunications service at retail are in this State
13         if the purchaser obtains the prepaid card or similar
14         means of conveyance at a location in this State.
15         Receipts from recharging a prepaid telecommunications
16         service or mobile telecommunications service is in
17         this State if the purchaser's billing information
18         indicates a location in this State.
19             (v) Receipts from the sale of private
20         communication services are in this State as follows:
21                 (a) 100% of receipts from charges imposed at
22             each channel termination point in this State.
23                 (b) 100% of receipts from charges for the total
24             channel mileage between each channel termination
25             point in this State.
26                 (c) 50% of the total receipts from charges for

 

 

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1             service segments when those segments are between 2
2             customer channel termination points, 1 of which is
3             located in this State and the other is located
4             outside of this State, which segments are
5             separately charged.
6                 (d) The receipts from charges for service
7             segments with a channel termination point located
8             in this State and in two or more other states, and
9             which segments are not separately billed, are in
10             this State based on a percentage determined by
11             dividing the number of customer channel
12             termination points in this State by the total
13             number of customer channel termination points.
14             (vi) Receipts from charges for ancillary services
15         for telecommunications service sold to customers at
16         retail are in this State if the customer's primary
17         place of use of telecommunications services associated
18         with those ancillary services is in this State. If the
19         seller of those ancillary services cannot determine
20         where the associated telecommunications are located,
21         then the ancillary services shall be based on the
22         location of the purchaser.
23             (vii) Receipts to access a carrier's network or
24         from the sale of telecommunication services or
25         ancillary services for resale are in this State as
26         follows:

 

 

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1                 (a) 100% of the receipts from access fees
2             attributable to intrastate telecommunications
3             service that both originates and terminates in
4             this State.
5                 (b) 50% of the receipts from access fees
6             attributable to interstate telecommunications
7             service if the interstate call either originates
8             or terminates in this State.
9                 (c) 100% of the receipts from interstate end
10             user access line charges, if the customer's
11             service address is in this State. As used in this
12             subdivision, "interstate end user access line
13             charges" includes, but is not limited to, the
14             surcharge approved by the federal communications
15             commission and levied pursuant to 47 CFR 69.
16                 (d) Gross receipts from sales of
17             telecommunication services or from ancillary
18             services for telecommunications services sold to
19             other telecommunication service providers for
20             resale shall be sourced to this State using the
21             apportionment concepts used for non-resale
22             receipts of telecommunications services if the
23             information is readily available to make that
24             determination. If the information is not readily
25             available, then the taxpayer may use any other
26             reasonable and consistent method.

 

 

09600SB1739sam003 - 22 - LRB096 09705 HLH 25701 a

1         (B-7) For taxable years ending on or after December 31,
2     2008, receipts from the sale of broadcasting services are
3     in this State if the broadcasting services are received in
4     this State. For purposes of this paragraph (B-7), the
5     following terms have the following meanings:
6             "Advertising revenue" means consideration received
7         by the taxpayer in exchange for broadcasting services
8         or allowing the broadcasting of commercials or
9         announcements in connection with the broadcasting of
10         film or radio programming, from sponsorships of the
11         programming, or from product placements in the
12         programming.
13             "Audience factor" means the ratio that the
14         audience or subscribers located in this State of a
15         station, a network, or a cable system bears to the
16         total audience or total subscribers for that station,
17         network, or cable system. The audience factor for film
18         or radio programming shall be determined by reference
19         to the books and records of the taxpayer or by
20         reference to published rating statistics provided the
21         method used by the taxpayer is consistently used from
22         year to year for this purpose and fairly represents the
23         taxpayer's activity in this State.
24             "Broadcast" or "broadcasting" or "broadcasting
25         services" means the transmission or provision of film
26         or radio programming, whether through the public

 

 

09600SB1739sam003 - 23 - LRB096 09705 HLH 25701 a

1         airwaves, by cable, by direct or indirect satellite
2         transmission, or by any other means of communication,
3         either through a station, a network, or a cable system.
4             "Film" or "film programming" means the broadcast
5         on television of any and all performances, events, or
6         productions, including but not limited to news,
7         sporting events, plays, stories, or other literary,
8         commercial, educational, or artistic works, either
9         live or through the use of video tape, disc, or any
10         other type of format or medium. Each episode of a
11         series of films produced for television shall
12         constitute separate "film" notwithstanding that the
13         series relates to the same principal subject and is
14         produced during one or more tax periods.
15             "Radio" or "radio programming" means the broadcast
16         on radio of any and all performances, events, or
17         productions, including but not limited to news,
18         sporting events, plays, stories, or other literary,
19         commercial, educational, or artistic works, either
20         live or through the use of an audio tape, disc, or any
21         other format or medium. Each episode in a series of
22         radio programming produced for radio broadcast shall
23         constitute a separate "radio programming"
24         notwithstanding that the series relates to the same
25         principal subject and is produced during one or more
26         tax periods.

 

 

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1                 (i) In the case of advertising revenue from
2             broadcasting, the customer is the advertiser and
3             the service is received in this State if the
4             commercial domicile of the advertiser is in this
5             State.
6                 (ii) In the case where film or radio
7             programming is broadcast by a station, a network,
8             or a cable system for a fee or other remuneration
9             received from the recipient of the broadcast, the
10             portion of the service that is received in this
11             State is measured by the portion of the recipients
12             of the broadcast located in this State.
13             Accordingly, the fee or other remuneration for
14             such service that is included in the Illinois
15             numerator of the sales factor is the total of those
16             fees or other remuneration received from
17             recipients in Illinois. For purposes of this
18             paragraph, a taxpayer may determine the location
19             of the recipients of its broadcast using the
20             address of the recipient shown in its contracts
21             with the recipient or using the billing address of
22             the recipient in the taxpayer's records.
23                 (iii) In the case where film or radio
24             programming is broadcast by a station, a network,
25             or a cable system for a fee or other remuneration
26             from the person providing the programming, the

 

 

09600SB1739sam003 - 25 - LRB096 09705 HLH 25701 a

1             portion of the broadcast service that is received
2             by such station, network, or cable system in this
3             State is measured by the portion of recipients of
4             the broadcast located in this State. Accordingly,
5             the amount of revenue related to such an
6             arrangement that is included in the Illinois
7             numerator of the sales factor is the total fee or
8             other total remuneration from the person providing
9             the programming related to that broadcast
10             multiplied by the Illinois audience factor for
11             that broadcast.
12                 (iv) In the case where film or radio
13             programming is provided by a taxpayer that is a
14             network or station to a customer for broadcast in
15             exchange for a fee or other remuneration from that
16             customer the broadcasting service is received at
17             the location of the office of the customer from
18             which the services were ordered in the regular
19             course of the customer's trade or business.
20             Accordingly, in such a case the revenue derived by
21             the taxpayer that is included in the taxpayer's
22             Illinois numerator of the sales factor is the
23             revenue from such customers who receive the
24             broadcasting service in Illinois.
25                 (v) In the case where film or radio programming
26             is provided by a taxpayer that is not a network or

 

 

09600SB1739sam003 - 26 - LRB096 09705 HLH 25701 a

1             station to another person for broadcasting in
2             exchange for a fee or other remuneration from that
3             person, the broadcasting service is received at
4             the location of the office of the customer from
5             which the services were ordered in the regular
6             course of the customer's trade or business.
7             Accordingly, in such a case the revenue derived by
8             the taxpayer that is included in the taxpayer's
9             Illinois numerator of the sales factor is the
10             revenue from such customers who receive the
11             broadcasting service in Illinois.
12         (C) For taxable years ending before December 31, 2008,
13     sales, other than sales governed by paragraphs (B), (B-1),
14     and (B-2), are in this State if:
15             (i) The income-producing activity is performed in
16         this State; or
17             (ii) The income-producing activity is performed
18         both within and without this State and a greater
19         proportion of the income-producing activity is
20         performed within this State than without this State,
21         based on performance costs.
22         (C-5) For taxable years ending on or after December 31,
23     2008, sales, other than sales governed by paragraphs (B),
24     (B-1), (B-2), and (B-5), and (B-7), are in this State if
25     any of the following criteria are met:
26             (i) Sales from the sale or lease of real property

 

 

09600SB1739sam003 - 27 - LRB096 09705 HLH 25701 a

1         are in this State if the property is located in this
2         State.
3             (ii) Sales from the lease or rental of tangible
4         personal property are in this State if the property is
5         located in this State during the rental period. Sales
6         from the lease or rental of tangible personal property
7         that is characteristically moving property, including,
8         but not limited to, motor vehicles, rolling stock,
9         aircraft, vessels, or mobile equipment are in this
10         State to the extent that the property is used in this
11         State.
12             (iii) In the case of interest, net gains (but not
13         less than zero) and other items of income from
14         intangible personal property, the sale is in this State
15         if:
16                 (a) in the case of a taxpayer who is a dealer
17             in the item of intangible personal property within
18             the meaning of Section 475 of the Internal Revenue
19             Code, the income or gain is received from a
20             customer in this State. For purposes of this
21             subparagraph, a customer is in this State if the
22             customer is an individual, trust or estate who is a
23             resident of this State and, for all other
24             customers, if the customer's commercial domicile
25             is in this State. Unless the dealer has actual
26             knowledge of the residence or commercial domicile

 

 

09600SB1739sam003 - 28 - LRB096 09705 HLH 25701 a

1             of a customer during a taxable year, the customer
2             shall be deemed to be a customer in this State if
3             the billing address of the customer, as shown in
4             the records of the dealer, is in this State; or
5                 (b) in all other cases, if the
6             income-producing activity of the taxpayer is
7             performed in this State or, if the
8             income-producing activity of the taxpayer is
9             performed both within and without this State, if a
10             greater proportion of the income-producing
11             activity of the taxpayer is performed within this
12             State than in any other state, based on performance
13             costs.
14             (iv) Sales of services are in this State if the
15         services are received in this State. For the purposes
16         of this section, gross receipts from the performance of
17         services provided to a corporation, partnership, or
18         trust may only be attributed to a state where that
19         corporation, partnership, or trust has a fixed place of
20         business. If the state where the services are received
21         is not readily determinable or is a state where the
22         corporation, partnership, or trust receiving the
23         service does not have a fixed place of business, the
24         services shall be deemed to be received at the location
25         of the office of the customer from which the services
26         were ordered in the regular course of the customer's

 

 

09600SB1739sam003 - 29 - LRB096 09705 HLH 25701 a

1         trade or business. If the ordering office cannot be
2         determined, the services shall be deemed to be received
3         at the office of the customer to which the services are
4         billed. If the taxpayer is not taxable in the state in
5         which the services are received, the sale must be
6         excluded from both the numerator and the denominator of
7         the sales factor. The Department shall adopt rules
8         prescribing where specific types of service are
9         received, including, but not limited to, broadcast,
10         cable, advertising, publishing, and utility service.
11         (D) For taxable years ending on or after December 31,
12     1995, the following items of income shall not be included
13     in the numerator or denominator of the sales factor:
14     dividends; amounts included under Section 78 of the
15     Internal Revenue Code; and Subpart F income as defined in
16     Section 952 of the Internal Revenue Code. No inference
17     shall be drawn from the enactment of this paragraph (D) in
18     construing this Section for taxable years ending before
19     December 31, 1995.
20         (E) Paragraphs (B-1) and (B-2) shall apply to tax years
21     ending on or after December 31, 1999, provided that a
22     taxpayer may elect to apply the provisions of these
23     paragraphs to prior tax years. Such election shall be made
24     in the form and manner prescribed by the Department, shall
25     be irrevocable, and shall apply to all tax years; provided
26     that, if a taxpayer's Illinois income tax liability for any

 

 

09600SB1739sam003 - 30 - LRB096 09705 HLH 25701 a

1     tax year, as assessed under Section 903 prior to January 1,
2     1999, was computed in a manner contrary to the provisions
3     of paragraphs (B-1) or (B-2), no refund shall be payable to
4     the taxpayer for that tax year to the extent such refund is
5     the result of applying the provisions of paragraph (B-1) or
6     (B-2) retroactively. In the case of a unitary business
7     group, such election shall apply to all members of such
8     group for every tax year such group is in existence, but
9     shall not apply to any taxpayer for any period during which
10     that taxpayer is not a member of such group.
11     (b) Insurance companies.
12         (1) In general. Except as otherwise provided by
13     paragraph (2), business income of an insurance company for
14     a taxable year shall be apportioned to this State by
15     multiplying such income by a fraction, the numerator of
16     which is the direct premiums written for insurance upon
17     property or risk in this State, and the denominator of
18     which is the direct premiums written for insurance upon
19     property or risk everywhere. For purposes of this
20     subsection, the term "direct premiums written" means the
21     total amount of direct premiums written, assessments and
22     annuity considerations as reported for the taxable year on
23     the annual statement filed by the company with the Illinois
24     Director of Insurance in the form approved by the National
25     Convention of Insurance Commissioners or such other form as
26     may be prescribed in lieu thereof.

 

 

09600SB1739sam003 - 31 - LRB096 09705 HLH 25701 a

1         (2) Reinsurance. If the principal source of premiums
2     written by an insurance company consists of premiums for
3     reinsurance accepted by it, the business income of such
4     company shall be apportioned to this State by multiplying
5     such income by a fraction, the numerator of which is the
6     sum of (i) direct premiums written for insurance upon
7     property or risk in this State, plus (ii) premiums written
8     for reinsurance accepted in respect of property or risk in
9     this State, and the denominator of which is the sum of
10     (iii) direct premiums written for insurance upon property
11     or risk everywhere, plus (iv) premiums written for
12     reinsurance accepted in respect of property or risk
13     everywhere. For taxable years ending before December 31,
14     2008, for purposes of this paragraph, premiums written for
15     reinsurance accepted in respect of property or risk in this
16     State, whether or not otherwise determinable, may, at the
17     election of the company, be determined on the basis of the
18     proportion which premiums written for reinsurance accepted
19     from companies commercially domiciled in Illinois bears to
20     premiums written for reinsurance accepted from all
21     sources, or, alternatively, in the proportion which the sum
22     of the direct premiums written for insurance upon property
23     or risk in this State by each ceding company from which
24     reinsurance is accepted bears to the sum of the total
25     direct premiums written by each such ceding company for the
26     taxable year.

 

 

09600SB1739sam003 - 32 - LRB096 09705 HLH 25701 a

1     (c) Financial organizations.
2         (1) In general. For taxable years ending before
3     December 31, 2008, business income of a financial
4     organization shall be apportioned to this State by
5     multiplying such income by a fraction, the numerator of
6     which is its business income from sources within this
7     State, and the denominator of which is its business income
8     from all sources. For the purposes of this subsection, the
9     business income of a financial organization from sources
10     within this State is the sum of the amounts referred to in
11     subparagraphs (A) through (E) following, but excluding the
12     adjusted income of an international banking facility as
13     determined in paragraph (2):
14             (A) Fees, commissions or other compensation for
15         financial services rendered within this State;
16             (B) Gross profits from trading in stocks, bonds or
17         other securities managed within this State;
18             (C) Dividends, and interest from Illinois
19         customers, which are received within this State;
20             (D) Interest charged to customers at places of
21         business maintained within this State for carrying
22         debit balances of margin accounts, without deduction
23         of any costs incurred in carrying such accounts; and
24             (E) Any other gross income resulting from the
25         operation as a financial organization within this
26         State. In computing the amounts referred to in

 

 

09600SB1739sam003 - 33 - LRB096 09705 HLH 25701 a

1         paragraphs (A) through (E) of this subsection, any
2         amount received by a member of an affiliated group
3         (determined under Section 1504(a) of the Internal
4         Revenue Code but without reference to whether any such
5         corporation is an "includible corporation" under
6         Section 1504(b) of the Internal Revenue Code) from
7         another member of such group shall be included only to
8         the extent such amount exceeds expenses of the
9         recipient directly related thereto.
10         (2) International Banking Facility. For taxable years
11     ending before December 31, 2008:
12             (A) Adjusted Income. The adjusted income of an
13         international banking facility is its income reduced
14         by the amount of the floor amount.
15             (B) Floor Amount. The floor amount shall be the
16         amount, if any, determined by multiplying the income of
17         the international banking facility by a fraction, not
18         greater than one, which is determined as follows:
19                 (i) The numerator shall be:
20                 The average aggregate, determined on a
21             quarterly basis, of the financial organization's
22             loans to banks in foreign countries, to foreign
23             domiciled borrowers (except where secured
24             primarily by real estate) and to foreign
25             governments and other foreign official
26             institutions, as reported for its branches,

 

 

09600SB1739sam003 - 34 - LRB096 09705 HLH 25701 a

1             agencies and offices within the state on its
2             "Consolidated Report of Condition", Schedule A,
3             Lines 2.c., 5.b., and 7.a., which was filed with
4             the Federal Deposit Insurance Corporation and
5             other regulatory authorities, for the year 1980,
6             minus
7                 The average aggregate, determined on a
8             quarterly basis, of such loans (other than loans of
9             an international banking facility), as reported by
10             the financial institution for its branches,
11             agencies and offices within the state, on the
12             corresponding Schedule and lines of the
13             Consolidated Report of Condition for the current
14             taxable year, provided, however, that in no case
15             shall the amount determined in this clause (the
16             subtrahend) exceed the amount determined in the
17             preceding clause (the minuend); and
18                 (ii) the denominator shall be the average
19             aggregate, determined on a quarterly basis, of the
20             international banking facility's loans to banks in
21             foreign countries, to foreign domiciled borrowers
22             (except where secured primarily by real estate)
23             and to foreign governments and other foreign
24             official institutions, which were recorded in its
25             financial accounts for the current taxable year.
26             (C) Change to Consolidated Report of Condition and

 

 

09600SB1739sam003 - 35 - LRB096 09705 HLH 25701 a

1         in Qualification. In the event the Consolidated Report
2         of Condition which is filed with the Federal Deposit
3         Insurance Corporation and other regulatory authorities
4         is altered so that the information required for
5         determining the floor amount is not found on Schedule
6         A, lines 2.c., 5.b. and 7.a., the financial institution
7         shall notify the Department and the Department may, by
8         regulations or otherwise, prescribe or authorize the
9         use of an alternative source for such information. The
10         financial institution shall also notify the Department
11         should its international banking facility fail to
12         qualify as such, in whole or in part, or should there
13         be any amendment or change to the Consolidated Report
14         of Condition, as originally filed, to the extent such
15         amendment or change alters the information used in
16         determining the floor amount.
17         (3) For taxable years ending on or after December 31,
18     2008, the business income of a financial organization shall
19     be apportioned to this State by multiplying such income by
20     a fraction, the numerator of which is its gross receipts
21     from sources in this State or otherwise attributable to
22     this State's marketplace and the denominator of which is
23     its gross receipts everywhere during the taxable year.
24     "Gross receipts" for purposes of this subparagraph (3)
25     means gross income, including net taxable gain on
26     disposition of assets, including securities and money

 

 

09600SB1739sam003 - 36 - LRB096 09705 HLH 25701 a

1     market instruments, when derived from transactions and
2     activities in the regular course of the financial
3     organization's trade or business. The following examples
4     are illustrative:
5             (i) Receipts from the lease or rental of real or
6         tangible personal property are in this State if the
7         property is located in this State during the rental
8         period. Receipts from the lease or rental of tangible
9         personal property that is characteristically moving
10         property, including, but not limited to, motor
11         vehicles, rolling stock, aircraft, vessels, or mobile
12         equipment are from sources in this State to the extent
13         that the property is used in this State.
14             (ii) Interest income, commissions, fees, gains on
15         disposition, and other receipts from assets in the
16         nature of loans that are secured primarily by real
17         estate or tangible personal property are from sources
18         in this State if the security is located in this State.
19             (iii) Interest income, commissions, fees, gains on
20         disposition, and other receipts from consumer loans
21         that are not secured by real or tangible personal
22         property are from sources in this State if the debtor
23         is a resident of this State.
24             (iv) Interest income, commissions, fees, gains on
25         disposition, and other receipts from commercial loans
26         and installment obligations that are not secured by

 

 

09600SB1739sam003 - 37 - LRB096 09705 HLH 25701 a

1         real or tangible personal property are from sources in
2         this State if the proceeds of the loan are to be
3         applied in this State. If it cannot be determined where
4         the funds are to be applied, the income and receipts
5         are from sources in this State if the office of the
6         borrower from which the loan was negotiated in the
7         regular course of business is located in this State. If
8         the location of this office cannot be determined, the
9         income and receipts shall be excluded from the
10         numerator and denominator of the sales factor.
11             (v) Interest income, fees, gains on disposition,
12         service charges, merchant discount income, and other
13         receipts from credit card receivables are from sources
14         in this State if the card charges are regularly billed
15         to a customer in this State.
16             (vi) Receipts from the performance of services,
17         including, but not limited to, fiduciary, advisory,
18         and brokerage services, are in this State if the
19         services are received in this State within the meaning
20         of subparagraph (a)(3)(C-5)(iv) of this Section.
21             (vii) Receipts from the issuance of travelers
22         checks and money orders are from sources in this State
23         if the checks and money orders are issued from a
24         location within this State.
25             (viii) Receipts from investment assets and
26         activities and trading assets and activities are

 

 

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1         included in the receipts factor as follows:
2                 (1) Interest, dividends, net gains (but not
3             less than zero) and other income from investment
4             assets and activities from trading assets and
5             activities shall be included in the receipts
6             factor. Investment assets and activities and
7             trading assets and activities include but are not
8             limited to: investment securities; trading account
9             assets; federal funds; securities purchased and
10             sold under agreements to resell or repurchase;
11             options; futures contracts; forward contracts;
12             notional principal contracts such as swaps;
13             equities; and foreign currency transactions. With
14             respect to the investment and trading assets and
15             activities described in subparagraphs (A) and (B)
16             of this paragraph, the receipts factor shall
17             include the amounts described in such
18             subparagraphs.
19                     (A) The receipts factor shall include the
20                 amount by which interest from federal funds
21                 sold and securities purchased under resale
22                 agreements exceeds interest expense on federal
23                 funds purchased and securities sold under
24                 repurchase agreements.
25                     (B) The receipts factor shall include the
26                 amount by which interest, dividends, gains and

 

 

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1                 other income from trading assets and
2                 activities, including but not limited to
3                 assets and activities in the matched book, in
4                 the arbitrage book, and foreign currency
5                 transactions, exceed amounts paid in lieu of
6                 interest, amounts paid in lieu of dividends,
7                 and losses from such assets and activities.
8                 (2) The numerator of the receipts factor
9             includes interest, dividends, net gains (but not
10             less than zero), and other income from investment
11             assets and activities and from trading assets and
12             activities described in paragraph (1) of this
13             subsection that are attributable to this State.
14                     (A) The amount of interest, dividends, net
15                 gains (but not less than zero), and other
16                 income from investment assets and activities
17                 in the investment account to be attributed to
18                 this State and included in the numerator is
19                 determined by multiplying all such income from
20                 such assets and activities by a fraction, the
21                 numerator of which is the gross income from
22                 such assets and activities which are properly
23                 assigned to a fixed place of business of the
24                 taxpayer within this State and the denominator
25                 of which is the gross income from all such
26                 assets and activities.

 

 

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1                     (B) The amount of interest from federal
2                 funds sold and purchased and from securities
3                 purchased under resale agreements and
4                 securities sold under repurchase agreements
5                 attributable to this State and included in the
6                 numerator is determined by multiplying the
7                 amount described in subparagraph (A) of
8                 paragraph (1) of this subsection from such
9                 funds and such securities by a fraction, the
10                 numerator of which is the gross income from
11                 such funds and such securities which are
12                 properly assigned to a fixed place of business
13                 of the taxpayer within this State and the
14                 denominator of which is the gross income from
15                 all such funds and such securities.
16                     (C) The amount of interest, dividends,
17                 gains, and other income from trading assets and
18                 activities, including but not limited to
19                 assets and activities in the matched book, in
20                 the arbitrage book and foreign currency
21                 transactions (but excluding amounts described
22                 in subparagraphs (A) or (B) of this paragraph),
23                 attributable to this State and included in the
24                 numerator is determined by multiplying the
25                 amount described in subparagraph (B) of
26                 paragraph (1) of this subsection by a fraction,

 

 

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1                 the numerator of which is the gross income from
2                 such trading assets and activities which are
3                 properly assigned to a fixed place of business
4                 of the taxpayer within this State and the
5                 denominator of which is the gross income from
6                 all such assets and activities.
7                     (D) Properly assigned, for purposes of
8                 this paragraph (2) of this subsection, means
9                 the investment or trading asset or activity is
10                 assigned to the fixed place of business with
11                 which it has a preponderance of substantive
12                 contacts. An investment or trading asset or
13                 activity assigned by the taxpayer to a fixed
14                 place of business without the State shall be
15                 presumed to have been properly assigned if:
16                         (i) the taxpayer has assigned, in the
17                     regular course of its business, such asset
18                     or activity on its records to a fixed place
19                     of business consistent with federal or
20                     state regulatory requirements;
21                         (ii) such assignment on its records is
22                     based upon substantive contacts of the
23                     asset or activity to such fixed place of
24                     business; and
25                         (iii) the taxpayer uses such records
26                     reflecting assignment of such assets or

 

 

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1                     activities for the filing of all state and
2                     local tax returns for which an assignment
3                     of such assets or activities to a fixed
4                     place of business is required.
5                     (E) The presumption of proper assignment
6                 of an investment or trading asset or activity
7                 provided in subparagraph (D) of paragraph (2)
8                 of this subsection may be rebutted upon a
9                 showing by the Department, supported by a
10                 preponderance of the evidence, that the
11                 preponderance of substantive contacts
12                 regarding such asset or activity did not occur
13                 at the fixed place of business to which it was
14                 assigned on the taxpayer's records. If the
15                 fixed place of business that has a
16                 preponderance of substantive contacts cannot
17                 be determined for an investment or trading
18                 asset or activity to which the presumption in
19                 subparagraph (D) of paragraph (2) of this
20                 subsection does not apply or with respect to
21                 which that presumption has been rebutted, that
22                 asset or activity is properly assigned to the
23                 state in which the taxpayer's commercial
24                 domicile is located. For purposes of this
25                 subparagraph (E), it shall be presumed,
26                 subject to rebuttal, that taxpayer's

 

 

09600SB1739sam003 - 43 - LRB096 09705 HLH 25701 a

1                 commercial domicile is in the state of the
2                 United States or the District of Columbia to
3                 which the greatest number of employees are
4                 regularly connected with the management of the
5                 investment or trading income or out of which
6                 they are working, irrespective of where the
7                 services of such employees are performed, as of
8                 the last day of the taxable year.
9         (4) (Blank).
10         (5) (Blank).
11     (d) Transportation services. For taxable years ending
12 before December 31, 2008, business income derived from
13 furnishing transportation services shall be apportioned to
14 this State in accordance with paragraphs (1) and (2):
15         (1) Such business income (other than that derived from
16     transportation by pipeline) shall be apportioned to this
17     State by multiplying such income by a fraction, the
18     numerator of which is the revenue miles of the person in
19     this State, and the denominator of which is the revenue
20     miles of the person everywhere. For purposes of this
21     paragraph, a revenue mile is the transportation of 1
22     passenger or 1 net ton of freight the distance of 1 mile
23     for a consideration. Where a person is engaged in the
24     transportation of both passengers and freight, the
25     fraction above referred to shall be determined by means of
26     an average of the passenger revenue mile fraction and the

 

 

09600SB1739sam003 - 44 - LRB096 09705 HLH 25701 a

1     freight revenue mile fraction, weighted to reflect the
2     person's
3             (A) relative railway operating income from total
4         passenger and total freight service, as reported to the
5         Interstate Commerce Commission, in the case of
6         transportation by railroad, and
7             (B) relative gross receipts from passenger and
8         freight transportation, in case of transportation
9         other than by railroad.
10         (2) Such business income derived from transportation
11     by pipeline shall be apportioned to this State by
12     multiplying such income by a fraction, the numerator of
13     which is the revenue miles of the person in this State, and
14     the denominator of which is the revenue miles of the person
15     everywhere. For the purposes of this paragraph, a revenue
16     mile is the transportation by pipeline of 1 barrel of oil,
17     1,000 cubic feet of gas, or of any specified quantity of
18     any other substance, the distance of 1 mile for a
19     consideration.
20         (3) For taxable years ending on or after December 31,
21     2008, business income derived from providing
22     transportation services other than airline services shall
23     be apportioned to this State by using a fraction, (a) the
24     numerator of which shall be (i) all receipts from any
25     movement or shipment of people, goods, mail, oil, gas, or
26     any other substance (other than by airline) that both

 

 

09600SB1739sam003 - 45 - LRB096 09705 HLH 25701 a

1     originates and terminates in this State, plus (ii) that
2     portion of the person's gross receipts from movements or
3     shipments of people, goods, mail, oil, gas, or any other
4     substance (other than by airline) that originates in one
5     state or jurisdiction and terminates in another state or
6     jurisdiction, that is determined by the ratio that the
7     miles traveled in this State bears to total miles
8     everywhere and (b) the denominator of which shall be all
9     revenue derived from the movement or shipment of people,
10     goods, mail, oil, gas, or any other substance (other than
11     by airline). Where a taxpayer is engaged in the
12     transportation of both passengers and freight, the
13     fraction above referred to shall first be determined
14     separately for passenger miles and freight miles. Then an
15     average of the passenger miles fraction and the freight
16     miles fraction shall be weighted to reflect the taxpayer's:
17             (A) relative railway operating income from total
18         passenger and total freight service, as reported to the
19         Surface Transportation Board, in the case of
20         transportation by railroad; and
21             (B) relative gross receipts from passenger and
22         freight transportation, in case of transportation
23         other than by railroad.
24         (4) For taxable years ending on or after December 31,
25     2008, business income derived from furnishing airline
26     transportation services shall be apportioned to this State

 

 

09600SB1739sam003 - 46 - LRB096 09705 HLH 25701 a

1     by multiplying such income by a fraction, the numerator of
2     which is the revenue miles of the person in this State, and
3     the denominator of which is the revenue miles of the person
4     everywhere. For purposes of this paragraph, a revenue mile
5     is the transportation of one passenger or one net ton of
6     freight the distance of one mile for a consideration. If a
7     person is engaged in the transportation of both passengers
8     and freight, the fraction above referred to shall be
9     determined by means of an average of the passenger revenue
10     mile fraction and the freight revenue mile fraction,
11     weighted to reflect the person's relative gross receipts
12     from passenger and freight airline transportation.
13     (e) Combined apportionment. Where 2 or more persons are
14 engaged in a unitary business as described in subsection
15 (a)(27) of Section 1501, a part of which is conducted in this
16 State by one or more members of the group, the business income
17 attributable to this State by any such member or members shall
18 be apportioned by means of the combined apportionment method.
19     (f) Alternative allocation. If the allocation and
20 apportionment provisions of subsections (a) through (e) and of
21 subsection (h) do not fairly represent the extent of a person's
22 business activity in this State, the person may petition for,
23 or the Director may, without a petition, permit or require, in
24 respect of all or any part of the person's business activity,
25 if reasonable:
26         (1) Separate accounting;

 

 

09600SB1739sam003 - 47 - LRB096 09705 HLH 25701 a

1         (2) The exclusion of any one or more factors;
2         (3) The inclusion of one or more additional factors
3     which will fairly represent the person's business
4     activities in this State; or
5         (4) The employment of any other method to effectuate an
6     equitable allocation and apportionment of the person's
7     business income.
8     (g) Cross reference. For allocation of business income by
9 residents, see Section 301(a).
10     (h) For tax years ending on or after December 31, 1998, the
11 apportionment factor of persons who apportion their business
12 income to this State under subsection (a) shall be equal to:
13         (1) for tax years ending on or after December 31, 1998
14     and before December 31, 1999, 16 2/3% of the property
15     factor plus 16 2/3% of the payroll factor plus 66 2/3% of
16     the sales factor;
17         (2) for tax years ending on or after December 31, 1999
18     and before December 31, 2000, 8 1/3% of the property factor
19     plus 8 1/3% of the payroll factor plus 83 1/3% of the sales
20     factor;
21         (3) for tax years ending on or after December 31, 2000,
22     the sales factor.
23 If, in any tax year ending on or after December 31, 1998 and
24 before December 31, 2000, the denominator of the payroll,
25 property, or sales factor is zero, the apportionment factor
26 computed in paragraph (1) or (2) of this subsection for that

 

 

09600SB1739sam003 - 48 - LRB096 09705 HLH 25701 a

1 year shall be divided by an amount equal to 100% minus the
2 percentage weight given to each factor whose denominator is
3 equal to zero.
4 (Source: P.A. 94-247, eff. 1-1-06; 95-233, eff. 8-16-07;
5 95-707, eff. 1-11-08.)
 
6     Section 99. Effective date. This Act takes effect upon
7 becoming law.".