HB3263 98TH GENERAL ASSEMBLY

LRB098 08376 HLH 38481 b

98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
HB3263

Introduced , by Rep. Keith Farnham

SYNOPSIS AS INTRODUCED:

35 ILCS 5/224 new

Amends the Illinois Income Tax Act. Creates a credit in an amount equal to a percentage of the taxpayer's qualified production activities income. Provides that, for taxable years ending on or after December 31, 2014 and prior to December 31, 2015, the credit shall be 2% of the taxpayer's qualified production activities income for the taxable year; for taxable years ending on or after December 31, 2015 and prior to December 31, 2016, the credit shall be 4% of the taxpayer's qualified production activities income for the taxable year; and for taxable years ending on or after December 31, 2016, the credit shall be 6.2% of the taxpayer's qualified production activities income for the taxable year. Provides that excess credit amounts may be carried forward and applied to the tax liability of the 15 taxable years following the excess credit year. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

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

Section 5. The Illinois Income Tax Act is amended by adding Section 224 as follows:

(35 ILCS 5/224 new)

Sec. 224. Credit for qualified production activities income. For taxable years ending on or after December 31, 2014, each taxpayer is entitled to a credit against the tax imposed under subsections (a) and (b) of Section 201 in an amount equal to a percentage of the taxpayer's qualified production activities income as set forth in this Section. For taxable years ending on or after December 31, 2014 and prior to December 31, 2015, the credit shall be 2% of the taxpayer's qualified production activities income for the taxable year. For taxable years ending on or after December 31, 2015 and prior to December 31, 2016, the credit shall be 4% of the taxpayer's qualified production activities income for the taxable year. For taxable years ending on or after December 31, 2016, the credit shall be 6.2% of the taxpayer's qualified production activities income for the taxable year.

In no event shall a credit under this Section reduce the taxpayer's liability under this Act to less than zero. If the amount of the credit exceeds the tax liability for the taxable year, whether it exceeds the original liability or the liability as later amended, the excess may be carried forward and applied to the tax liability of the 15 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a liability. If there is credit from more than one tax year that is available to offset a liability, earlier credit shall be applied first.

For the purposes of this Section "qualified production activities income" has the meaning ascribed to that term in subsection (c) of Section 199 of the federal Internal Revenue Code.

This Section is exempt from the provisions of Section 250.

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