Full Text of HB4563 98th General Assembly
HB4563 98TH GENERAL ASSEMBLY |
| | 98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014 HB4563 Introduced , by Rep. David Harris SYNOPSIS AS INTRODUCED: |
| 35 ILCS 5/704A | | 35 ILCS 10/5-15 | |
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Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that any taxpayer that has been awarded an EDGE credit for a taxable year beginning on or after January 1, 2014 may elect to claim up to 20% of the amount of the credit against its obligation to pay over withholding taxes. Amends the Illinois Income Tax Act to make conforming changes. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
| | A BILL FOR |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Income Tax Act is amended by | 5 | | changing Section 704A as follows: | 6 | | (35 ILCS 5/704A) | 7 | | Sec. 704A. Employer's return and payment of tax withheld. | 8 | | (a) In general, every employer who deducts and withholds or | 9 | | is required to deduct and withhold tax under this Act on or | 10 | | after January 1, 2008 shall make those payments and returns as | 11 | | provided in this Section. | 12 | | (b) Returns. Every employer shall, in the form and manner | 13 | | required by the Department, make returns with respect to taxes | 14 | | withheld or required to be withheld under this Article 7 for | 15 | | each quarter beginning on or after January 1, 2008, on or | 16 | | before the last day of the first month following the close of | 17 | | that quarter. | 18 | | (c) Payments. With respect to amounts withheld or required | 19 | | to be withheld on or after January 1, 2008: | 20 | | (1) Semi-weekly payments. For each calendar year, each | 21 | | employer who withheld or was required to withhold more than | 22 | | $12,000 during the one-year period ending on June 30 of the | 23 | | immediately preceding calendar year, payment must be made: |
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| 1 | | (A) on or before each Friday of the calendar year, | 2 | | for taxes withheld or required to be withheld on the | 3 | | immediately preceding Saturday, Sunday, Monday, or | 4 | | Tuesday; | 5 | | (B) on or before each Wednesday of the calendar | 6 | | year, for taxes withheld or required to be withheld on | 7 | | the immediately preceding Wednesday, Thursday, or | 8 | | Friday. | 9 | | Beginning with calendar year 2011, payments made under | 10 | | this paragraph (1) of subsection (c) must be made by | 11 | | electronic funds transfer. | 12 | | (2) Semi-weekly payments. Any employer who withholds | 13 | | or is required to withhold more than $12,000 in any quarter | 14 | | of a calendar year is required to make payments on the | 15 | | dates set forth under item (1) of this subsection (c) for | 16 | | each remaining quarter of that calendar year and for the | 17 | | subsequent calendar year.
| 18 | | (3) Monthly payments. Each employer, other than an | 19 | | employer described in items (1) or (2) of this subsection, | 20 | | shall pay to the Department, on or before the 15th day of | 21 | | each month the taxes withheld or required to be withheld | 22 | | during the immediately preceding month. | 23 | | (4) Payments with returns. Each employer shall pay to | 24 | | the Department, on or before the due date for each return | 25 | | required to be filed under this Section, any tax withheld | 26 | | or required to be withheld during the period for which the |
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| 1 | | return is due and not previously paid to the Department. | 2 | | (d) Regulatory authority. The Department may, by rule: | 3 | | (1) Permit employers, in lieu of the requirements of | 4 | | subsections (b) and (c), to file annual returns due on or | 5 | | before January 31 of the year for taxes withheld or | 6 | | required to be withheld during the previous calendar year | 7 | | and, if the aggregate amounts required to be withheld by | 8 | | the employer under this Article 7 (other than amounts | 9 | | required to be withheld under Section 709.5) do not exceed | 10 | | $1,000 for the previous calendar year, to pay the taxes | 11 | | required to be shown on each such return no later than the | 12 | | due date for such return. | 13 | | (2) Provide that any payment required to be made under | 14 | | subsection (c)(1) or (c)(2) is deemed to be timely to the | 15 | | extent paid by electronic funds transfer on or before the | 16 | | due date for deposit of federal income taxes withheld from, | 17 | | or federal employment taxes due with respect to, the wages | 18 | | from which the Illinois taxes were withheld. | 19 | | (3) Designate one or more depositories to which payment | 20 | | of taxes required to be withheld under this Article 7 must | 21 | | be paid by some or all employers. | 22 | | (4) Increase the threshold dollar amounts at which | 23 | | employers are required to make semi-weekly payments under | 24 | | subsection (c)(1) or (c)(2). | 25 | | (e) Annual return and payment. Every employer who deducts | 26 | | and withholds or is required to deduct and withhold tax from a |
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| 1 | | person engaged in domestic service employment, as that term is | 2 | | defined in Section 3510 of the Internal Revenue Code, may | 3 | | comply with the requirements of this Section with respect to | 4 | | such employees by filing an annual return and paying the taxes | 5 | | required to be deducted and withheld on or before the 15th day | 6 | | of the fourth month following the close of the employer's | 7 | | taxable year. The Department may allow the employer's return to | 8 | | be submitted with the employer's individual income tax return | 9 | | or to be submitted with a return due from the employer under | 10 | | Section 1400.2 of the Unemployment Insurance Act. | 11 | | (f) Magnetic media and electronic filing. Any W-2 Form | 12 | | that, under the Internal Revenue Code and regulations | 13 | | promulgated thereunder, is required to be submitted to the | 14 | | Internal Revenue Service on magnetic media or electronically | 15 | | must also be submitted to the Department on magnetic media or | 16 | | electronically for Illinois purposes, if required by the | 17 | | Department. | 18 | | (g) For amounts deducted or withheld after December 31, | 19 | | 2009, a taxpayer who makes an election under subsection (f) of | 20 | | Section 5-15 of the Economic Development for a Growing Economy | 21 | | Tax Credit Act for a taxable year shall be allowed a credit | 22 | | against payments due under this Section for amounts withheld | 23 | | during the first calendar year beginning after the end of that | 24 | | taxable year equal to the amount of the credit for the | 25 | | incremental income tax attributable to full-time employees of | 26 | | the taxpayer awarded to the taxpayer by the Department of |
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| 1 | | Commerce and Economic Opportunity under the Economic | 2 | | Development for a Growing Economy Tax Credit Act for the | 3 | | taxable year and credits not previously claimed and allowed to | 4 | | be carried forward under Section 211(4) of this Act as provided | 5 | | in subsection (f) of Section 5-15 of the Economic Development | 6 | | for a Growing Economy Tax Credit Act , except that, in the case | 7 | | of an election made under item (1.8) of subsection (f) of | 8 | | Section 5-15 of the Economic Development for a Growing Economy | 9 | | Tax Credit Act, the amount of the credit that may be taken | 10 | | against payments due under this Section shall be limited to 20% | 11 | | of the amount of the credit awarded under the Economic | 12 | | Development for a Growing Economy Tax Credit Act . The credit or | 13 | | credits may not reduce the taxpayer's obligation for any | 14 | | payment due under this Section to less than zero. If the amount | 15 | | of the credit or credits exceeds the total payments due under | 16 | | this Section with respect to amounts withheld during the | 17 | | calendar year, the excess may be carried forward and applied | 18 | | against the taxpayer's liability under this Section in the | 19 | | succeeding calendar years as allowed to be carried forward | 20 | | under paragraph (4) of Section 211 of this Act. The credit or | 21 | | credits shall be applied to the earliest year for which there | 22 | | is a tax liability. If there are credits from more than one | 23 | | taxable year that are available to offset a liability, the | 24 | | earlier credit shall be applied first. Each employer who | 25 | | deducts and withholds or is required to deduct and withhold tax | 26 | | under this Act and who retains income tax withholdings under |
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| 1 | | subsection (f) of Section 5-15 of the Economic Development for | 2 | | a Growing Economy Tax Credit Act must make a return with | 3 | | respect to such taxes and retained amounts in the form and | 4 | | manner that the Department, by rule, requires and pay to the | 5 | | Department or to a depositary designated by the Department | 6 | | those withheld taxes not retained by the taxpayer. For purposes | 7 | | of this subsection (g), the term taxpayer shall include | 8 | | taxpayer and members of the taxpayer's unitary business group | 9 | | as defined under paragraph (27) of subsection (a) of Section | 10 | | 1501 of this Act. This Section is exempt from the provisions of | 11 | | Section 250 of this Act. | 12 | | (h) An employer may claim a credit against payments due | 13 | | under this Section for amounts withheld during the first | 14 | | calendar year ending after the date on which a tax credit | 15 | | certificate was issued under Section 35 of the Small Business | 16 | | Job Creation Tax Credit Act. The credit shall be equal to the | 17 | | amount shown on the certificate, but may not reduce the | 18 | | taxpayer's obligation for any payment due under this Section to | 19 | | less than zero. If the amount of the credit exceeds the total | 20 | | payments due under this Section with respect to amounts | 21 | | withheld during the calendar year, the excess may be carried | 22 | | forward and applied against the taxpayer's liability under this | 23 | | Section in the 5 succeeding calendar years. The credit shall be | 24 | | applied to the earliest year for which there is a tax | 25 | | liability. If there are credits from more than one calendar | 26 | | year that are available to offset a liability, the earlier |
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| 1 | | credit shall be applied first. This Section is exempt from the | 2 | | provisions of Section 250 of this Act. | 3 | | (Source: P.A. 96-834, eff. 12-14-09; 96-888, eff. 4-13-10; | 4 | | 96-905, eff. 6-4-10; 96-1027, eff. 7-12-10; 97-333, eff. | 5 | | 8-12-11; 97-507, eff. 8-23-11.) | 6 | | Section 10. The Economic Development for a Growing Economy | 7 | | Tax Credit Act is amended by changing Section 5-15 as follows: | 8 | | (35 ILCS 10/5-15) | 9 | | Sec. 5-15. Tax Credit Awards. Subject to the conditions set | 10 | | forth in this
Act, a Taxpayer is
entitled to a Credit against | 11 | | or, as described in subsection (g) of this Section, a payment | 12 | | towards taxes imposed pursuant to subsections (a) and (b)
of | 13 | | Section 201 of the Illinois
Income Tax Act that may be imposed | 14 | | on the Taxpayer for a taxable year beginning
on or
after | 15 | | January 1, 1999,
if the Taxpayer is awarded a Credit by the | 16 | | Department under this Act for that
taxable year. | 17 | | (a) The Department shall make Credit awards under this Act | 18 | | to foster job
creation and retention in Illinois. | 19 | | (b) A person that proposes a project to create new jobs in | 20 | | Illinois must
enter into an Agreement with the
Department for | 21 | | the Credit under this Act. | 22 | | (c) The Credit shall be claimed for the taxable years | 23 | | specified in the
Agreement. | 24 | | (d) The Credit shall not exceed the Incremental Income Tax |
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| 1 | | attributable to
the project that is the subject of the | 2 | | Agreement. | 3 | | (e) Nothing herein shall prohibit a Tax Credit Award to an | 4 | | Applicant that uses a PEO if all other award criteria are | 5 | | satisfied.
| 6 | | (f) In lieu of the Credit allowed under this Act against | 7 | | the taxes imposed pursuant to subsections (a) and (b) of | 8 | | Section 201 of the Illinois Income Tax Act for any taxable year | 9 | | ending on or after December 31, 2009, the Taxpayer may elect to | 10 | | claim the Credit against its obligation to pay over withholding | 11 | | under Section 704A of the Illinois Income Tax Act. | 12 | | (1) The election under this subsection (f) may be made | 13 | | only by a Taxpayer that (i) is primarily engaged in one of | 14 | | the following business activities: water purification and | 15 | | treatment, motor vehicle metal stamping, automobile | 16 | | manufacturing, automobile and light duty motor vehicle | 17 | | manufacturing, motor vehicle manufacturing, light truck | 18 | | and utility vehicle manufacturing, heavy duty truck | 19 | | manufacturing, motor vehicle body manufacturing, cable | 20 | | television infrastructure design or manufacturing, or | 21 | | wireless telecommunication or computing terminal device | 22 | | design or manufacturing for use on public networks and (ii) | 23 | | meets the following criteria: | 24 | | (A) the Taxpayer (i) had an Illinois net loss or an | 25 | | Illinois net loss deduction under Section 207 of the | 26 | | Illinois Income Tax Act for the taxable year in which |
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| 1 | | the Credit is awarded, (ii) employed a minimum of 1,000 | 2 | | full-time employees in this State during the taxable | 3 | | year in which the Credit is awarded, (iii) has an | 4 | | Agreement under this Act on December 14, 2009 (the | 5 | | effective date of Public Act 96-834), and (iv) is in | 6 | | compliance with all provisions of that Agreement; | 7 | | (B) the Taxpayer (i) had an Illinois net loss or an | 8 | | Illinois net loss deduction under Section 207 of the | 9 | | Illinois Income Tax Act for the taxable year in which | 10 | | the Credit is awarded, (ii) employed a minimum of 1,000 | 11 | | full-time employees in this State during the taxable | 12 | | year in which the Credit is awarded, and (iii) has | 13 | | applied for an Agreement within 365 days after December | 14 | | 14, 2009 (the effective date of Public Act 96-834); | 15 | | (C) the Taxpayer (i) had an Illinois net operating | 16 | | loss carryforward under Section 207 of the Illinois | 17 | | Income Tax Act in a taxable year ending during calendar | 18 | | year 2008, (ii) has applied for an Agreement within 150 | 19 | | days after the effective date of this amendatory Act of | 20 | | the 96th General Assembly, (iii) creates at least 400 | 21 | | new jobs in Illinois, (iv) retains at least 2,000 jobs | 22 | | in Illinois that would have been at risk of relocation | 23 | | out of Illinois over a 10-year period, and (v) makes a | 24 | | capital investment of at least $75,000,000; | 25 | | (D) the Taxpayer (i) had an Illinois net operating | 26 | | loss carryforward under Section 207 of the Illinois |
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| 1 | | Income Tax Act in a taxable year ending during calendar | 2 | | year 2009, (ii) has applied for an Agreement within 150 | 3 | | days after the effective date of this amendatory Act of | 4 | | the 96th General Assembly, (iii) creates at least 150 | 5 | | new jobs, (iv) retains at least 1,000 jobs in Illinois | 6 | | that would have been at risk of relocation out of | 7 | | Illinois over a 10-year period, and (v) makes a capital | 8 | | investment of at least $57,000,000; or | 9 | | (E) the Taxpayer (i) employed at least 2,500 | 10 | | full-time employees in the State during the year in | 11 | | which the Credit is awarded, (ii) commits to make at | 12 | | least $500,000,000 in combined capital improvements | 13 | | and project costs under the Agreement, (iii) applies | 14 | | for an Agreement between January 1, 2011 and June 30, | 15 | | 2011, (iv) executes an Agreement for the Credit during | 16 | | calendar year 2011, and (v) was incorporated no more | 17 | | than 5 years before the filing of an application for an | 18 | | Agreement. | 19 | | (1.5) The election under this subsection (f) may also | 20 | | be made by a Taxpayer for any Credit awarded pursuant to an | 21 | | agreement that was executed between January 1, 2011 and | 22 | | June 30, 2011, if the Taxpayer (i) is primarily engaged in | 23 | | the manufacture of inner tubes or tires, or both, from | 24 | | natural and synthetic rubber, (ii) employs a minimum of | 25 | | 2,400 full-time employees in Illinois at the time of | 26 | | application, (iii) creates at least 350 full-time jobs and |
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| 1 | | retains at least 250 full-time jobs in Illinois that would | 2 | | have been at risk of being created or retained outside of | 3 | | Illinois, and (iv) makes a capital investment of at least | 4 | | $200,000,000 at the project location. | 5 | | (1.6) The election under this subsection (f) may also | 6 | | be made by a Taxpayer for any Credit awarded pursuant to an | 7 | | agreement that was executed within 150 days after the | 8 | | effective date of this amendatory Act of the 97th General | 9 | | Assembly, if the Taxpayer (i) is primarily engaged in the | 10 | | operation of a discount department store, (ii) maintains | 11 | | its corporate headquarters in Illinois, (iii) employs a | 12 | | minimum of 4,250 full-time employees at its corporate | 13 | | headquarters in Illinois at the time of application, (iv) | 14 | | retains at least 4,250 full-time jobs in Illinois that | 15 | | would have been at risk of being relocated outside of | 16 | | Illinois, (v) had a minimum of $40,000,000,000 in total | 17 | | revenue in 2010, and (vi) makes a capital investment of at | 18 | | least $300,000,000 at the project location. | 19 | | (1.7) Notwithstanding any other provision of law, the | 20 | | election under this subsection (f) may also be made by a | 21 | | Taxpayer for any Credit awarded pursuant to an agreement | 22 | | that was executed or applied for on or after July 1, 2011 | 23 | | and on or before March 31, 2012, if the Taxpayer is | 24 | | primarily engaged in the manufacture of original and | 25 | | aftermarket filtration parts and products for automobiles, | 26 | | motor vehicles, light duty motor vehicles, light trucks and |
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| 1 | | utility vehicles, and heavy duty trucks, (ii) employs a | 2 | | minimum of 1,000 full-time employees in Illinois at the | 3 | | time of application, (iii) creates at least 250 full-time | 4 | | jobs in Illinois, (iv) relocates its corporate | 5 | | headquarters to Illinois from another state, and (v) makes | 6 | | a capital investment of at least $4,000,000 at the project | 7 | | location. | 8 | | (1.8) Notwithstanding any other provision of law, any | 9 | | taxpayer that (i) is awarded a credit under this Act for a | 10 | | taxable year beginning on or after January 1, 2014 and (ii) | 11 | | is not a taxpayer that is otherwise entitled to make an | 12 | | election under items (1) through (1.7) of this subsection | 13 | | (f) may elect to claim up to 20% of the amount of the | 14 | | credit awarded for the taxable year, including unused | 15 | | credits that are carried forward from previous taxable | 16 | | years, against its obligation to pay over withholding under | 17 | | Section 704A of the Illinois Income Tax Act. If such an | 18 | | election is made, the amount of the credit that may be used | 19 | | against the taxes imposed under subsections (a) and (b) of | 20 | | Section 201 of the Illinois Income Tax Act shall be reduced | 21 | | accordingly. | 22 | | (2) An election under this subsection shall allow the | 23 | | credit to be taken against payments otherwise due under | 24 | | Section 704A of the Illinois Income Tax Act during the | 25 | | first calendar year beginning after the end of the taxable | 26 | | year in which the credit is awarded under this Act. |
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| 1 | | (3) The election shall be made in the form and manner | 2 | | required by the Illinois Department of Revenue and, once | 3 | | made, shall be irrevocable. | 4 | | (4) If a Taxpayer who meets the requirements of | 5 | | subparagraph (A) of paragraph (1) of this subsection (f) | 6 | | elects to claim the Credit against its withholdings as | 7 | | provided in this subsection (f), then, on and after the | 8 | | date of the election, the terms of the Agreement between | 9 | | the Taxpayer and the Department may not be further amended | 10 | | during the term of the Agreement. | 11 | | (g) A pass-through entity that has been awarded a credit | 12 | | under this Act, its shareholders, or its partners may treat | 13 | | some or all of the credit awarded pursuant to this Act as a tax | 14 | | payment for purposes of the Illinois Income Tax Act. The term | 15 | | "tax payment" means a payment as described in Article 6 or | 16 | | Article 8 of the Illinois Income Tax Act or a composite payment | 17 | | made by a pass-through entity on behalf of any of its | 18 | | shareholders or partners to satisfy such shareholders' or | 19 | | partners' taxes imposed pursuant to subsections (a) and (b) of | 20 | | Section 201 of the Illinois Income Tax Act. In no event shall | 21 | | the amount of the award credited pursuant to this Act exceed | 22 | | the Illinois income tax liability of the pass-through entity or | 23 | | its shareholders or partners for the taxable year. | 24 | | (Source: P.A. 96-834, eff. 12-14-09; 96-836, eff. 12-16-09; | 25 | | 96-905, eff. 6-4-10; 96-1000, eff. 7-2-10; 96-1534, eff. | 26 | | 3-4-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12 .)
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| 1 | | Section 99. Effective date. This Act takes effect upon | 2 | | becoming law.
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