Illinois General Assembly - Full Text of HB4596
Illinois General Assembly

  Bills & Resolutions  
  Compiled Statutes  
  Public Acts  
  Legislative Reports  
  IL Constitution  
  Legislative Guide  
  Legislative Glossary  

 Search By Number
 (example: HB0001)
Search Tips

Search By Keyword

Full Text of HB4596  102nd General Assembly

HB4596 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB4596

 

Introduced 1/21/2022, by Rep. Delia C. Ramirez - Dagmara Avelar

 

SYNOPSIS AS INTRODUCED:
 
New Act
35 ILCS 5/232 new
215 ILCS 5/409  from Ch. 73, par. 1021
215 ILCS 5/444  from Ch. 73, par. 1056

    Creates the Build Illinois Homes Tax Credit Act. Provides that owners of qualified low-income housing developments are eligible for credits against the taxes imposed by the Illinois Income Tax Act or taxes, penalties, fees, charges, and payments imposed by the Illinois Insurance Code. Amends the Illinois Income Tax Act and the Illinois Insurance Code to make conforming changes. Effective immediately.


LRB102 22729 HLH 31875 b

 

 

A BILL FOR

 

HB4596LRB102 22729 HLH 31875 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the Build
5Illinois Homes Tax Credit Act.
 
6    Section 5. Definitions. As used in this Act, unless the
7context clearly requires otherwise:
8    "Allocation" means an award of tax credits to the owner of
9a qualified development in any allocation round, to be claimed
10ratably annually over the credit period.
11    "Allocation round" means all allocations by the Authority
12of credits under this Act to qualified developments in any
13calendar year.
14    "Allocation schedule certification" means the
15certification issued by the owner of a qualified development
16or its designee pursuant to subsection (d) of Section 10 of
17this Act.
18    "Authority" means:
19        (1) the Illinois Housing Development Authority; or
20        (2) the City of Chicago Department of Housing.
21    "Credit" means the credit allowed pursuant to this Act.
22    "Credit period" means the period of 10 taxable years
23beginning with the taxable year in which a qualified

 

 

HB4596- 2 -LRB102 22729 HLH 31875 b

1development is placed in service. No credit period may include
2a taxable year beginning prior to January 1, 2022. If a
3qualified development consists of more than one building, the
4qualified development is deemed to be placed in service in the
5taxable year during which the last building of the qualified
6development is placed in service.
7    "Department" means the Department of Revenue.
8    "Federal tax credit" means the federal low-income housing
9tax credit provided by Section 42 of the federal Internal
10Revenue Code, including federal low-income housing tax credits
11issued pursuant to 26 U.S.C. 42(h)(3) and 26 U.S.C. 42(h)(4).
12    "Qualified allocation plan" means the qualified allocation
13plan adopted by the Authority pursuant to Section 42(m) of the
14federal Internal Revenue Code of 1986.
15    "Qualified basis" means the qualified basis of the
16qualified development as determined pursuant to Section 42 of
17the federal Internal Revenue Code of 1986.
18    "Qualified development" means a qualified low-income
19housing project, as that term is defined in Section 42 of the
20federal Internal Revenue Code of 1986, that is located in the
21State and is determined to be eligible for the federal tax
22credit set forth in Section 42 of the Internal Revenue Code.
23    "Qualified taxpayer" means an individual, person, firm,
24corporation, or other entity that owns an interest, direct or
25indirect, in a qualified development and is subject to any or
26all of the following: (i) the taxes imposed by the Illinois

 

 

HB4596- 3 -LRB102 22729 HLH 31875 b

1Income Tax Act; or (ii) any privilege tax or retaliatory tax,
2penalty, fee, charge or payment imposed by the Illinois
3Insurance Code.
4    "State credit eligibility statement" means a statement
5issued by the Authority under Section 7.
6    "State tax return" means the income tax return filed with
7the Department or the privilege and retaliatory tax return
8filed with the Department of Insurance, as applicable.
 
9    Section 7. State credit eligibility statements. A State
10credit eligibility statement shall be issued by the Authority
11with respect to each building within the qualified development
12following construction or rehabilitation of the qualified
13development certifying that each such building within that
14qualified development qualifies for the credit and specifying:
15        (1) the calendar year in which the last building of
16    the qualified development was placed in service;
17        (2) the amount of the credit allowed for each year of
18    the credit period;
19        (3) the maximum qualified basis of the qualified
20    development taken into account in determining such annual
21    credit amount; and
22        (4) a unique identification number for each State
23    credit eligibility statement issued.
24    The State credit eligibility statement shall be issued by
25the Authority simultaneously with IRS Form 8609 if the

 

 

HB4596- 4 -LRB102 22729 HLH 31875 b

1qualified development was also allocated federal tax credits.
2    The State credit eligibility statement shall include a
3Section to be completed by the owner of the qualified
4development annually for each year of the credit period
5certifying that the qualified development was in conformance
6with all compliance requirements. That certification shall be
7filed with the project owner's State tax return annually of
8each year of the credit period.
 
9    Section 10. Credit for low-income housing developments.
10    (a) The Authority shall include the credit in its annual
11qualified allocation plan each year until expiration of this
12Act. Each allocation round shall be simultaneous with
13allocations of federal tax credits.
14    (b) For taxable years beginning on or after January 1,
152023, the Authority may allocate a credit to the owner of a
16qualified development in any allocation round in an amount
17determined by the Authority, subject to the following
18guidelines:
19        (1) the Authority must find that the credit is
20    necessary for the financial feasibility of the qualified
21    development;
22        (2) the aggregate sum of credits allocated to
23    qualified developments in any allocation round shall not
24    exceed $35,000,000, plus the amount of unallocated
25    credits, if any, from the preceding allocation round, plus

 

 

HB4596- 5 -LRB102 22729 HLH 31875 b

1    the amount of any credit recaptured or otherwise returned
2    to the Authority since the previous allocation round;
3        (3) of the $35,000,000 annual allocation: (i) 75.5% of
4    the available credits in each allocation round shall be
5    allocated by the Illinois Housing Development Authority,
6    plus any credits the Illinois Housing Development
7    Authority did not allocate from the previous allocation
8    round, plus the amount of any credits recaptured or
9    otherwise returned to the Illinois Housing Development
10    Authority since the previous allocation round; and (ii)
11    24.5% of the available credits in each allocation round
12    shall be allocated by the City of Chicago Department of
13    Housing, plus any credits the City of Chicago Department
14    of Housing did not allocate from the previous allocation
15    round, plus the amount of any credits recaptured or
16    otherwise returned to the City of Chicago Department of
17    Housing since the previous allocation round; and
18        (4) unless otherwise provided in this Act, or unless
19    the context clearly requires otherwise, the Authority must
20    determine eligibility for credits and allocate credits in
21    accordance with the standards and requirements set forth
22    in Section 42 of the federal Internal Revenue Code of
23    1986.
24    (c) For tax years during the credit period, any qualified
25taxpayer is allowed a credit as provided in this Act against
26any or all of the following: (i) the taxes imposed by

 

 

HB4596- 6 -LRB102 22729 HLH 31875 b

1subsections (a) and (b) of Section 201 of the Illinois Income
2Tax Act; or (ii) any privilege tax or retaliatory tax,
3penalty, fee, charge, or payment imposed under the Illinois
4Insurance Code.
5    (d) If a taxpayer receiving an allocation of a credit is
6(i) a corporation that has an election in effect under
7Subchapter S of the federal Internal Revenue Code, (ii) a
8partnership, or (iii) a limited liability company, that is
9taxed as a partnership, the credit provided under this Act may
10be claimed by the shareholders of the corporation, the
11partners of the partnership, or the members of the limited
12liability company (as those terms are defined under applicable
13State law) in the same manner as those shareholders, partners,
14or members account for their proportionate shares of the
15income or losses of the corporation, partnership, or limited
16liability company, or as provided in the bylaws or other
17executed agreement of the corporation, partnership, or limited
18liability company. Credits granted to a partnership, a limited
19liability company taxed as a partnership, or other multiple
20owners of property shall be passed through to the partners,
21members, or owners respectively on a pro rata basis or
22pursuant to an executed agreement among the partners, members,
23or owners documenting any alternative distribution method. A
24qualified taxpayer may claim a credit so long as its direct or
25indirect interest in the qualified development is acquired
26prior to the filing of its tax return claiming the credit. On

 

 

HB4596- 7 -LRB102 22729 HLH 31875 b

1or before February 28th following each year of the credit
2period, the owner must submit an allocation schedule
3certification in an electronic format prescribed by the
4Department and the Department of Insurance to the Department
5and the Department of Insurance detailing the amount of credit
6allocated to each qualified taxpayer for the applicable year
7and whether each qualified taxpayer intends to apply the
8credit to income tax or insurance premium tax, or the owner
9must notify the Department and the Department of Insurance
10that it has assigned the duty of the allocation schedule
11certification to its designee who must provide such allocation
12schedule certification to the Department and the Department of
13Insurance by the deadline. Such allocation schedule
14certification may be amended in the event the State credit
15eligibility statement for a project is received after the
16deadline for filing the allocation schedule certification. Any
17such amendment shall be filed prior to any taxpayer attempting
18to claim tax credits associated with the applicable State
19credit eligibility statement. Each qualified taxpayer is
20allowed to claim its allocated amount of credit subject to any
21restrictions set forth in this Section.
22    (e) No credit may be allocated pursuant to this Act unless
23the qualified development is the subject of a recorded
24restrictive covenant requiring the development to be
25maintained and operated as a qualified development; this
26requirement for a recorded restrictive covenant may be

 

 

HB4596- 8 -LRB102 22729 HLH 31875 b

1satisfied by the agreement for an extended low-income housing
2commitment required for the federal tax credits as defined in
3Section 42(h)(6)(B) of the federal Internal Revenue Code of
41986.
5    (f) If, during a taxable year, there is a determination
6that no recorded restrictive covenant meeting the requirements
7of subsection (e) was in effect as of the beginning of that
8year, such determination shall not apply to any period before
9that year and subsection (e) shall be applied without regard
10to that determination if the failure is corrected within one
11year from the date of the determination.
12    (g) In any year of the credit period, a qualified taxpayer
13may claim the credit against the taxes imposed by the Illinois
14Income Tax Act or the taxes, penalties, fees, charges, and
15payments imposed by the Illinois Insurance Code. Any credit
16amount that exceeds the tax due for a taxable year may be
17carried forward as a credit against payments due for up to 5
18taxable years following the taxable year in which the credit
19is first claimed to which the credit relates. Credits that are
20carried forward must be applied first to the earliest
21reporting period possible. Credits that are initially claimed
22against taxes imposed by the Illinois Income Tax Act may be
23carried forward only against the taxpayer's future Illinois
24Income Tax liability. Credits that are initially claimed
25against taxes, penalties, fees, charges, and payments imposed
26by the Illinois Insurance Code may be carried forward only

 

 

HB4596- 9 -LRB102 22729 HLH 31875 b

1against taxes, penalties, fees, charges, and payments imposed
2by the Illinois Insurance Code. Credits that are not claimed
3or carried forward may not be refunded to the taxpayer.
4    (h) By February 28, 2023 and by February 28 of each year
5thereafter, the Authority shall provide to the Department and
6the Department of Insurance an electronic file containing all
7data related to all State credit eligibility statements issued
8during the preceding year in the manner and form as provided by
9the Department.
 
10    Section 15. Recapture. If, under Section 42 of the
11Internal Revenue Code of 1986, a portion of any federal tax
12credit claimed with respect to a qualified development is
13required to be recaptured during the first 10 years after a
14project is placed in service, then the Authority shall provide
15written notice, upon a form created by the Authority, to the
16owner of the qualified development, the Department and the
17Department of Insurance of the amount to be recaptured and the
18event triggering recapture. The Authority shall provide such
19notice to the Department and Department of Insurance no
20earlier than 6 months after the event triggering recapture to
21allow the owner of the qualified development an opportunity to
22correct this event. The amount of credit subject to recapture
23shall be proportionately equal to the amount of the qualified
24development's federal tax credits which are subject to
25recapture. The Authority shall notify the qualified taxpayer

 

 

HB4596- 10 -LRB102 22729 HLH 31875 b

1that claimed the credit of the amount recaptured, and the
2qualified taxpayer subject to recapture shall increase the
3qualified taxpayer's tax by the amount of any credit
4wrongfully claimed in the tax year the qualified taxpayer is
5notified of the recapture. If multiple taxpayers claimed
6credit with respect to the building for which credit is to be
7recaptured, each of those taxpayers shall be liable for a
8portion of the recapture equal to the percentages of credit
9with respect to the building originally claimed by the
10taxpayer.
 
11    Section 20. Filing requirements. An owner of a qualified
12development that has received an allocation and each qualified
13taxpayer claiming any portion of the credit must file with
14their State tax returns a copy of the State credit eligibility
15statement issued by the Authority for that qualified
16development. A qualified taxpayer receiving an allocation of
17credit through a pass-through entity shall attach to its State
18tax return a copy of the Schedule K-1-P or other written
19statement from the pass-through entity stating the portion of
20the annual credit shown on the State credit eligibility
21statement that is allocated to that partner, member or
22shareholder for that taxable year. In addition, the owner of a
23qualified development or its designee shall file a copy of the
24allocation schedule certification prior to any tax return
25being filed claiming a State credit for such qualified

 

 

HB4596- 11 -LRB102 22729 HLH 31875 b

1development.
 
2    Section 25. Rules. The Illinois Housing Development
3Authority, the Department, and the Department of Insurance, in
4consultation with each other, shall adopt such rules as are
5necessary to carry out their respective responsibilities under
6this Act.
 
7    Section 30. Compliance monitoring. The Authority, in
8consultation with the Department, shall monitor and oversee
9compliance with the provisions of this Act and shall report
10specific occurrences of noncompliance to the Department and
11the Department of Insurance.
 
12    Section 35. Report to the General Assembly.
13    (a) The Illinois Housing Development Authority and the
14Chicago Department of Housing must, by February 28 of each
15year following the annual allocation, provide a written report
16to the General Assembly and must publish that report on their
17websites.
18    (b) The report shall:
19        (1) set forth the number of qualified developments
20    that have been allocated tax credits under this Act during
21    the allocation year and the total number of units
22    supported by each qualified development;
23        (2) describe each qualified development that has been

 

 

HB4596- 12 -LRB102 22729 HLH 31875 b

1    allocated tax credits under this Act including, without
2    limitation, the geographic location of the qualified
3    development, the household type and any specific
4    demographic information available about residents intended
5    to be served by the qualified development, the income
6    levels intended to be served by the qualified development,
7    and the rents or set-asides authorized for each qualified
8    development;
9        (3) provide housing market and demographic information
10    that demonstrates how the qualified developments supported
11    by the tax credits are addressing the need for affordable
12    housing within the communities they are intended to serve
13    as well as information about any remaining disparities in
14    the affordability of housing within those communities; and
15        (4) provide information on the percentage of qualified
16    developments allocated credits that received incentive
17    scoring points in the qualified allocation plan as a
18    result of the general contractor, property manager,
19    architect, or sponsor being certified under the Business
20    Enterprise Program for Minorities, Females, and Persons
21    with a Disability.
 
22    Section 40. Exempt from automatic sunset. The credit under
23this Act is exempt from the provisions of Section 250 of the
24Illinois Income Tax Act.
 

 

 

HB4596- 13 -LRB102 22729 HLH 31875 b

1    Section 60. The Illinois Income Tax Act is amended by
2adding Section 232 as follows:
 
3    (35 ILCS 5/232 new)
4    Sec. 232. Build Illinois Homes Tax Credit Act.
5    (a) For taxable years beginning on or after January 1,
62023, any eligible taxpayer with respect to a credit awarded
7in accordance with the Build Illinois Homes Tax Credit Act
8that is named on the allocation schedule certification for a
9particular tax year is entitled to a credit against the taxes
10imposed by subsections (a) and (b) of Section 201 as provided
11in the Build Illinois Homes Tax Credit Act.
12    (b) The taxpayer shall attach a copy of the allocation
13schedule certification and the State credit eligibility
14certificate issued under the Build Illinois Homes Tax Credit
15Act to the tax return on which the credits are to be claimed.
16    (c) If, during any taxable year, a taxpayer is notified of
17a recapture of a credit previously claimed on a State income
18tax return in accordance with the Build Illinois Homes Tax
19Credit Act, the tax imposed under subsections (a) and (b) of
20Section 201 for that taxpayer for that taxable year shall be
21increased. The amount of the increase shall be determined by
22(i) recomputing the Build Illinois Homes Tax Credit that would
23have been allowed for the year in which the credit was
24originally allowed by eliminating the recaptured amount from
25such computation, and (ii) subtracting that recomputed credit

 

 

HB4596- 14 -LRB102 22729 HLH 31875 b

1from the amount of credit previously allowed. No Build
2Illinois Homes tax Credit shall be allowed with respect to any
3credit subject to a recapture notice for any taxable year
4ending after the issuance of a recapture notice.
5    (d) This Section is exempt from the provisions of Section
6250.
 
7    Section 65. The Illinois Insurance Code is amended by
8changing Sections 409 and 444 as follows:
 
9    (215 ILCS 5/409)  (from Ch. 73, par. 1021)
10    Sec. 409. Annual privilege tax payable by companies.
11    (1) As of January 1, 1999 for all health maintenance
12organization premiums written; as of July 1, 1998 for all
13premiums written as accident and health business, voluntary
14health service plan business, dental service plan business, or
15limited health service organization business; and as of
16January 1, 1998 for all other types of insurance premiums
17written, every company doing any form of insurance business in
18this State, including, but not limited to, every risk
19retention group, and excluding all fraternal benefit
20societies, all farm mutual companies, all religious charitable
21risk pooling trusts, and excluding all statutory residual
22market and special purpose entities in which companies are
23statutorily required to participate, whether incorporated or
24otherwise, shall pay, for the privilege of doing business in

 

 

HB4596- 15 -LRB102 22729 HLH 31875 b

1this State, to the Director for the State treasury a State tax
2equal to 0.5% of the net taxable premium written, together
3with any amounts due under Section 444 of this Code, except
4that the tax to be paid on any premium derived from any
5accident and health insurance or on any insurance business
6written by any company operating as a health maintenance
7organization, voluntary health service plan, dental service
8plan, or limited health service organization shall be equal to
90.4% of such net taxable premium written, together with any
10amounts due under Section 444. Upon the failure of any company
11to pay any such tax due, the Director may, by order, revoke or
12suspend the company's certificate of authority after giving 20
13days written notice to the company, or commence proceedings
14for the suspension of business in this State under the
15procedures set forth by Section 401.1 of this Code. The gross
16taxable premium written shall be the gross amount of premiums
17received on direct business during the calendar year on
18contracts covering risks in this State, except premiums on
19annuities, premiums on which State premium taxes are
20prohibited by federal law, premiums paid by the State for
21health care coverage for Medicaid eligible insureds as
22described in Section 5-2 of the Illinois Public Aid Code,
23premiums paid for health care services included as an element
24of tuition charges at any university or college owned and
25operated by the State of Illinois, premiums on group insurance
26contracts under the State Employees Group Insurance Act of

 

 

HB4596- 16 -LRB102 22729 HLH 31875 b

11971, and except premiums for deferred compensation plans for
2employees of the State, units of local government, or school
3districts. The net taxable premium shall be the gross taxable
4premium written reduced only by the following:
5        (a) the amount of premiums returned thereon which
6    shall be limited to premiums returned during the same
7    preceding calendar year and shall not include the return
8    of cash surrender values or death benefits on life
9    policies including annuities;
10        (b) dividends on such direct business that have been
11    paid in cash, applied in reduction of premiums or left to
12    accumulate to the credit of policyholders or annuitants.
13    In the case of life insurance, no deduction shall be made
14    for the payment of deferred dividends paid in cash to
15    policyholders on maturing policies; dividends left to
16    accumulate to the credit of policyholders or annuitants
17    shall be included as gross taxable premium written when
18    such dividend accumulations are applied to purchase
19    paid-up insurance or to shorten the endowment or premium
20    paying period.
21    (2) The annual privilege tax payment due from a company
22under subsection (4) of this Section may be reduced by: (a) the
23excess amount, if any, by which the aggregate income taxes
24paid by the company, on a cash basis, for the preceding
25calendar year under Sections 601 and 803 of the Illinois
26Income Tax Act exceed 1.5% of the company's net taxable

 

 

HB4596- 17 -LRB102 22729 HLH 31875 b

1premium written for that prior calendar year, as determined
2under subsection (1) of this Section; and (b) the amount of any
3fire department taxes paid by the company during the preceding
4calendar year under Section 11-10-1 of the Illinois Municipal
5Code. Any deductible amount or offset allowed under items (a)
6and (b) of this subsection for any calendar year will not be
7allowed as a deduction or offset against the company's
8privilege tax liability for any other taxing period or
9calendar year.
10    (3) If a company survives or was formed by a merger,
11consolidation, reorganization, or reincorporation, the
12premiums received and amounts returned or paid by all
13companies party to the merger, consolidation, reorganization,
14or reincorporation shall, for purposes of determining the
15amount of the tax imposed by this Section, be regarded as
16received, returned, or paid by the surviving or new company.
17    (4)(a) All companies subject to the provisions of this
18Section shall make an annual return for the preceding calendar
19year on or before March 15 setting forth such information on
20such forms as the Director may reasonably require. Payments of
21quarterly installments of the taxpayer's total estimated tax
22for the current calendar year shall be due on or before April
2315, June 15, September 15, and December 15 of such year, except
24that all companies transacting insurance in this State whose
25annual tax for the immediately preceding calendar year was
26less than $5,000 shall make only an annual return. Failure of a

 

 

HB4596- 18 -LRB102 22729 HLH 31875 b

1company to make the annual payment, or to make the quarterly
2payments, if required, of at least 25% of either (i) the total
3tax paid during the previous calendar year or (ii) 80% of the
4actual tax for the current calendar year shall subject it to
5the penalty provisions set forth in Section 412 of this Code.
6    (b) Notwithstanding the foregoing provisions, no annual
7return shall be required or made on March 15, 1998, under this
8subsection. For the calendar year 1998:
9        (i) each health maintenance organization shall have no
10    estimated tax installments;
11        (ii) all companies subject to the tax as of July 1,
12    1998 as set forth in subsection (1) shall have estimated
13    tax installments due on September 15 and December 15 of
14    1998 which installments shall each amount to no less than
15    one-half of 80% of the actual tax on its net taxable
16    premium written during the period July 1, 1998, through
17    December 31, 1998; and
18        (iii) all other companies shall have estimated tax
19    installments due on June 15, September 15, and December 15
20    of 1998 which installments shall each amount to no less
21    than one-third of 80% of the actual tax on its net taxable
22    premium written during the calendar year 1998.
23    In the year 1999 and thereafter all companies shall make
24annual and quarterly installments of their estimated tax as
25provided by paragraph (a) of this subsection.
26    (5) In addition to the authority specifically granted

 

 

HB4596- 19 -LRB102 22729 HLH 31875 b

1under Article XXV of this Code, the Director shall have such
2authority to adopt rules and establish forms as may be
3reasonably necessary for purposes of determining the
4allocation of Illinois corporate income taxes paid under
5subsections (a) through (d) of Section 201 of the Illinois
6Income Tax Act amongst members of a business group that files
7an Illinois corporate income tax return on a unitary basis,
8for purposes of regulating the amendment of tax returns, for
9purposes of defining terms, and for purposes of enforcing the
10provisions of Article XXV of this Code. The Director shall
11also have authority to defer, waive, or abate the tax imposed
12by this Section if in his opinion the company's solvency and
13ability to meet its insured obligations would be immediately
14threatened by payment of the tax due.
15    (6) This Section is subject to the provisions of Section
1610 of the New Markets Development Program Act.
17    (7) This Section is subject to the provisions of the Build
18Illinois Homes Tax Credit Act. For taxable years beginning on
19or after January 1, 2022, qualified taxpayers are entitled to
20claim credits against the taxes imposed by this Section as
21provided in the Build Illinois Homes Tax Credit Act. Companies
22claiming a credit under the Build Illinois Homes Tax Credit
23Act are not required to pay any additional tax as a result of
24claiming the credit. The credit may fully offset any amounts
25imposed under this Section.
26(Source: P.A. 97-813, eff. 7-13-12; 98-1169, eff. 1-9-15.)
 

 

 

HB4596- 20 -LRB102 22729 HLH 31875 b

1    (215 ILCS 5/444)  (from Ch. 73, par. 1056)
2    Sec. 444. Retaliation.
3    (1) Whenever the existing or future laws of any other
4state or country shall require of companies incorporated or
5organized under the laws of this State as a condition
6precedent to their doing business in such other state or
7country, compliance with laws, rules, regulations, and
8prohibitions more onerous or burdensome than the rules and
9regulations imposed by this State on foreign or alien
10companies, or shall require any deposit of securities or other
11obligations in such state or country, for the protection of
12policyholders or otherwise or require of such companies or
13agents thereof or brokers the payment of penalties, fees,
14charges, or taxes greater than the penalties, fees, charges,
15or taxes required in the aggregate for like purposes by this
16Code or any other law of this State, of foreign or alien
17companies, agents thereof or brokers, then such laws, rules,
18regulations, and prohibitions of said other state or country
19shall apply to companies incorporated or organized under the
20laws of such state or country doing business in this State, and
21all such companies, agents thereof, or brokers doing business
22in this State, shall be required to make deposits, pay
23penalties, fees, charges, and taxes, in amounts equal to those
24required in the aggregate for like purposes of Illinois
25companies doing business in such state or country, agents

 

 

HB4596- 21 -LRB102 22729 HLH 31875 b

1thereof or brokers. Whenever any other state or country shall
2refuse to permit any insurance company incorporated or
3organized under the laws of this State to transact business
4according to its usual plan in such other state or country, the
5director may, if satisfied that such company of this State is
6solvent, properly managed, and can operate legally under the
7laws of such other state or country, forthwith suspend or
8cancel the license of every insurance company doing business
9in this State which is incorporated or organized under the
10laws of such other state or country to the extent that it
11insures in this State against any of the risks or hazards which
12are sought to be insured against by the company of this State
13in such other state or country.
14    (2) The provisions of this Section shall not apply to
15residual market or special purpose assessments or guaranty
16fund or guaranty association assessments, both under the laws
17of this State and under the laws of any other state or country,
18and any tax offset or credit for any such assessment shall, for
19purposes of this Section, be treated as a tax paid both under
20the laws of this State and under the laws of any other state or
21country.
22    (3) The terms "penalties", "fees", "charges", and "taxes"
23in subsection (1) of this Section shall include: the
24penalties, fees, charges, and taxes collected on a cash basis
25under State law and referenced within Article XXV exclusive of
26any items referenced by subsection (2) of this Section, but

 

 

HB4596- 22 -LRB102 22729 HLH 31875 b

1including any tax offset allowed under Section 531.13 of this
2Code; the aggregate Illinois corporate income taxes paid under
3Sections 601 and 803 of the Illinois Income Tax Act during the
4calendar year for which the retaliatory tax calculation is
5being made, less the recapture of any Illinois corporate
6income tax cash refunds to the extent that the amount of tax
7refunded was reported as part of the Illinois basis in the
8calculation of the retaliatory tax for a prior tax year,
9provided that such recaptured refund shall not exceed the
10amount necessary for equivalence of the Illinois basis with
11the state of incorporation basis in such tax year, and after
12any tax offset allowed under Section 531.13 of this Code;
13income or personal property taxes imposed by other states or
14countries; penalties, fees, charges, and taxes of other states
15or countries imposed for purposes like those of the penalties,
16fees, charges, and taxes specified in Article XXV of this Code
17exclusive of any item referenced in subsection (2) of this
18Section; and any penalties, fees, charges, and taxes required
19as a franchise, privilege, or licensing tax for conducting the
20business of insurance whether calculated as a percentage of
21income, gross receipts, premium, or otherwise.
22    (4) Nothing contained in this Section or Section 409 or
23Section 444.1 is intended to authorize or expand any power of
24local governmental units or municipalities to impose taxes,
25fees, or charges.
26    (5) This Section is subject to the provisions of Section

 

 

HB4596- 23 -LRB102 22729 HLH 31875 b

110 of the New Markets Development Program Act.
2    (6) This Section is subject to the provisions of the Build
3Illinois Homes Tax Credit Act. For taxable years beginning on
4or after January 1, 2022, qualified taxpayers are entitled to
5claim credits against the taxes imposed by this Section as
6provided in the Build Illinois Homes Tax Credit Act. Companies
7claiming a credit under the Build Illinois Homes Tax Credit
8Act are not required to pay any additional tax as a result of
9claiming the credit. The credit may fully offset any amounts
10imposed under this Section.
11(Source: P.A. 98-1169, eff. 1-9-15.)
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.