Illinois General Assembly - Full Text of HB3157
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Full Text of HB3157  98th General Assembly


Rep. Marcus C. Evans, Jr.

Filed: 3/19/2013





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2    AMENDMENT NO. ______. Amend House Bill 3157 on page 1, line
35, by replacing line 5 with the following:
4"changing Sections 304, 305, 307, 308, 502, and 709.5 as
5follows:"; and
6on page 65, by replacing lines 7 and 8 with the following:
7    "(f) For taxable years ending prior to December 31, 2014,
8the The Department may promulgate regulations to permit"; and
9by replacing everything from line 18 on page 65 through line 3
10on page 66 with the following:
11"individual income tax payments. For taxable years ending prior
12to December 31, 2014, the The Department may by regulation also
13permit such composite returns to include the income tax owed by
14Illinois residents attributable to their income from
15partnerships, Subchapter S corporations, insurance businesses
16organized under a Lloyds plan of operation, or limited



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1liability companies that are treated as partnership under
2Section 1501(a)(16) of this Act, in which case such Illinois
3residents will be permitted to claim credits on their
4individual returns for their shares of the composite tax
5payments. This paragraph of subsection (f) applies to taxable
6years ending on or after December 31, 1987 and ending prior to
7December 31, 2014."; and
8by replacing everything from line 18 on page 67 through line 16
9on page 95 with the following:
10    "(35 ILCS 5/709.5)
11    Sec. 709.5. Withholding by partnerships, Subchapter S
12corporations, and trusts.
13    (a) In general. For each taxable year ending on or after
14December 31, 2008, every partnership (other than a publicly
15traded partnership under Section 7704 of the Internal Revenue
16Code or investment partnership), Subchapter S corporation, and
17trust must withhold from each nonresident partner,
18shareholder, or beneficiary (other than a partner,
19shareholder, or beneficiary who is exempt from tax under
20Section 501(a) of the Internal Revenue Code or under Section
21205 of this Act, who is included on a composite return filed by
22the partnership or Subchapter S corporation for the taxable
23year under subsection (f) of Section 502 of this Act), or who
24is a retired partner, to the extent that partner's



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1distributions are exempt from tax under Section 203(a)(2)(F) of
2this Act) an amount equal to the sum distributable share of (i)
3the share of business income of the partnership, Subchapter S
4corporation, or trust apportionable to Illinois plus (ii) for
5taxable years ending on or after December 31, 2014, the share
6of nonbusiness income of the partnership, Subchapter S
7corporation, or trust allocated to Illinois under Section 303
8of this Act (other than an amount allocated to the commercial
9domicile of the taxpayer under Section 303 of this Act) that is
10distributable to of that partner, shareholder, or beneficiary
11under Sections 702 and 704 and Subchapter S of the Internal
12Revenue Code, whether or not distributed, (2) multiplied by the
13applicable rates of tax for that partner, or shareholder, or
14beneficiary under subsections (a) through (d) of Section 201 of
15this Act, and (3) net of the share of any credit under Article
162 of this Act that is distributable by the partnership,
17Subchapter S corporation, or trust and allowable against the
18tax liability of that partner, shareholder, or beneficiary for
19a taxable year ending on or after December 31, 2014.
20    (b) Credit for taxes withheld. Any amount withheld under
21subsection (a) of this Section and paid to the Department shall
22be treated as a payment of the estimated tax liability or of
23the liability for withholding under this Section of the
24partner, shareholder, or beneficiary to whom the income is
25distributable for the taxable year in which that person
26incurred a liability under this Act with respect to that



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1income. The Department shall adopt rules pursuant to which a
2partner, shareholder, or beneficiary may claim a credit against
3its obligation for withholding under this Section for amounts
4withheld under this Section with respect to income
5distributable to it by a partnership, Subchapter S corporation,
6or trust and allowing its partners, shareholders, or
7beneficiaries to claim a credit under this subsection (b) for
8those withheld amounts.
9    (c) Exemption from withholding.
10        (1) A partnership, Subchapter S corporation, or trust
11    shall not be required to withhold tax under subsection (a)
12    of this Section with respect to any nonresident partner,
13    shareholder, or beneficiary (other than an individual)
14    from whom the partnership, S corporation, or trust has
15    received a certificate, completed in the form and manner
16    prescribed by the Department, stating that such
17    nonresident partner, shareholder, or beneficiary shall:
18            (A) file all returns that the partner,
19        shareholder, or beneficiary is required to file under
20        Section 502 of this Act and make timely payment of all
21        taxes imposed under Section 201 of this Act or under
22        this Section on the partner, shareholder, or
23        beneficiary with respect to income of the partnership,
24        S corporation, or trust; and
25            (B) be subject to personal jurisdiction in this
26        State for purposes of the collection of income taxes,



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1        together with related interest and penalties, imposed
2        on the partner, shareholder, or beneficiary with
3        respect to the income of the partnership, S
4        corporation, or trust.
5        (2) The Department may revoke the exemption provided by
6    this subsection (c) at any time that it determines that the
7    nonresident partner, shareholder, or beneficiary is not
8    abiding by the terms of the certificate. The Department
9    shall notify the partnership, S corporation, or trust that
10    it has revoked a certificate by notice left at the usual
11    place of business of the partnership, S corporation, or
12    trust or by mail to the last known address of the
13    partnership, S corporation, or trust.
14        (3) A partnership, S corporation, or trust that
15    receives a certificate under this subsection (c) properly
16    completed by a nonresident partner, shareholder, or
17    beneficiary shall not be required to withhold any amount
18    from that partner, shareholder, or beneficiary, the
19    payment of which would be due under Section 711(a-5) of
20    this Act after the receipt of the certificate and no
21    earlier than 60 days after the Department has notified the
22    partnership, S corporation, or trust that the certificate
23    has been revoked.
24        (4) Certificates received by a the partnership, S
25    corporation, or trust under this subsection (c) must be
26    retained by the partnership, S corporation, or trust and a



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1    record of such certificates must be provided to the
2    Department, in a format in which the record is available
3    for review by the Department, upon request by the
4    Department. The Department may, by rule, require the record
5    of certificates to be maintained and provided to the
6    Department electronically.
7(Source: P.A. 97-507, eff. 8-23-11.)".