Illinois General Assembly - Full Text of HB0243
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Full Text of HB0243  97th General Assembly




State of Illinois
2011 and 2012


Introduced 01/25/11, by Rep. Darlene J. Senger - Ed Sullivan, Jr. - Sandy Cole


35 ILCS 5/207  from Ch. 120, par. 2-207

    Amends the Illinois Income Tax Act. Restores a net loss carryover deduction that was previously limited by Public Act 96-1496. Effective immediately.

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HB0243LRB097 05950 HLH 46019 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 5. The Illinois Income Tax Act is amended by
5changing Section 207 as follows:
6    (35 ILCS 5/207)  (from Ch. 120, par. 2-207)
7    Sec. 207. Net Losses.
8    (a) If after applying all of the (i) modifications provided
9for in paragraph (2) of Section 203(b), paragraph (2) of
10Section 203(c) and paragraph (2) of Section 203(d) and (ii) the
11allocation and apportionment provisions of Article 3 of this
12Act and subsection (c) of this Section, the taxpayer's net
13income results in a loss;
14        (1) for any taxable year ending prior to December 31,
15    1999, such loss shall be allowed as a carryover or
16    carryback deduction in the manner allowed under Section 172
17    of the Internal Revenue Code;
18        (2) for any taxable year ending on or after December
19    31, 1999 and prior to December 31, 2003, such loss shall be
20    allowed as a carryback to each of the 2 taxable years
21    preceding the taxable year of such loss and shall be a net
22    operating loss carryover to each of the 20 taxable years
23    following the taxable year of such loss; and



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1        (3) for any taxable year ending on or after December
2    31, 2003, such loss shall be allowed as a net operating
3    loss carryover to each of the 12 taxable years following
4    the taxable year of such loss, except as provided in
5    subsection (d). It is the intention of the General Assembly
6    that this amendatory Act of the 97th General Assembly
7    supersedes Public Act 96-1496. The changes made by this
8    amendatory Act apply for the entire period beginning on
9    January 1, 2011.
10    (a-5) Election to relinquish carryback and order of
11application of losses.
12            (A) For losses incurred in tax years ending prior
13        to December 31, 2003, the taxpayer may elect to
14        relinquish the entire carryback period with respect to
15        such loss. Such election shall be made in the form and
16        manner prescribed by the Department and shall be made
17        by the due date (including extensions of time) for
18        filing the taxpayer's return for the taxable year in
19        which such loss is incurred, and such election, once
20        made, shall be irrevocable.
21            (B) The entire amount of such loss shall be carried
22        to the earliest taxable year to which such loss may be
23        carried. The amount of such loss which shall be carried
24        to each of the other taxable years shall be the excess,
25        if any, of the amount of such loss over the sum of the
26        deductions for carryback or carryover of such loss



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1        allowable for each of the prior taxable years to which
2        such loss may be carried.
3    (b) Any loss determined under subsection (a) of this
4Section must be carried back or carried forward in the same
5manner for purposes of subsections (a) and (b) of Section 201
6of this Act as for purposes of subsections (c) and (d) of
7Section 201 of this Act.
8    (c) Notwithstanding any other provision of this Act, for
9each taxable year ending on or after December 31, 2008, for
10purposes of computing the loss for the taxable year under
11subsection (a) of this Section and the deduction taken into
12account for the taxable year for a net operating loss carryover
13under paragraphs (1), (2), and (3) of subsection (a) of this
14Section, the loss and net operating loss carryover shall be
15reduced in an amount equal to the reduction to the net
16operating loss and net operating loss carryover to the taxable
17year, respectively, required under Section 108(b)(2)(A) of the
18Internal Revenue Code, multiplied by a fraction, the numerator
19of which is the amount of discharge of indebtedness income that
20is excluded from gross income for the taxable year (but only if
21the taxable year ends on or after December 31, 2008) under
22Section 108(a) of the Internal Revenue Code and that would have
23been allocated and apportioned to this State under Article 3 of
24this Act but for that exclusion, and the denominator of which
25is the total amount of discharge of indebtedness income
26excluded from gross income under Section 108(a) of the Internal



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1Revenue Code for the taxable year. The reduction required under
2this subsection (c) shall be made after the determination of
3Illinois net income for the taxable year in which the
4indebtedness is discharged.
5    (d) In the case of a corporation (other than a Subchapter S
6corporation), no carryover deduction shall be allowed under
7this Section for any taxable year ending after December 31,
82010 and prior to December 31, 2014; provided that, for
9purposes of determining the taxable years to which a net loss
10may be carried under subsection (a) of this Section, no taxable
11year for which a deduction is disallowed under this subsection
12shall be counted.
13(Source: P.A. 95-233, eff. 8-16-07; 96-1496, eff. 1-13-11.)
14    Section 99. Effective date. This Act takes effect upon
15becoming law.