Full Text of HB6914 096th General Assembly
HB6914 96TH GENERAL ASSEMBLY |
| | 96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010 HB6914 Introduced , by Rep. Bill Mitchell SYNOPSIS AS INTRODUCED: |
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Creates the Manufacturing Job Destination Tax Credit Act and amends the Illinois Income Tax Act. Provides for a credit of 25% of the Illinois labor expenditures made by a manufacturing company in order to foster job creation and retention in Illinois. Authorizes the Department of Revenue to award a tax credit to taxpayer-employers who apply for the credit and meet certain Illinois labor expenditure requirements. Sets minimum requirements and procedures for certifying a taxpayer as an "accredited manufacturer" and for awarding the credit. Effective immediately.
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| | FISCAL NOTE ACT MAY APPLY | | HOUSING AFFORDABILITY IMPACT 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. Short title. This Act may be cited as the | 5 | | Manufacturing Job Destination Tax Credit Act. | 6 | | Section 10. Purpose. The General Assembly finds that the | 7 | | manufacturing sector provides a crucial underpinning for the | 8 | | economy of the State of Illinois. Therefore, it is in the best | 9 | | interest of the State of Illinois to make Illinois the | 10 | | preferred destination for manufacturing and to strengthen the | 11 | | existing industrial base in Illinois, thereby promoting job | 12 | | growth, an expedited economic recovery, and long-term revenue | 13 | | growth for the State. | 14 | | Section 15. Definitions. As used in this Act: | 15 | | "Accredited manufacturer" means a manufacturer that has | 16 | | been certified by the Department. | 17 | | "Credit" means an amount equal to 25% of qualifying | 18 | | Illinois labor expenditures approved by the Department. The | 19 | | accredited manufacturer is deemed to have paid, on its balance | 20 | | due day for the year, an amount equal to 25% of its qualified | 21 | | Illinois labor expenditure for the tax year. | 22 | | "Department" means the Department of Revenue. |
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| 1 | | "Director" means the Director of Revenue. | 2 | | "Illinois labor expenditure" means salary or wages paid to | 3 | | employees of an accredited manufacturer for services rendered | 4 | | in Illinois. | 5 | | To qualify as an Illinois labor expenditure, the | 6 | | expenditure must be: | 7 | | (1) reasonable under the circumstances; | 8 | | (2) included in the federal income tax basis of the | 9 | | property; | 10 | | (3) incurred in a county in the State that has had a | 11 | | seasonally adjusted unemployment rate of more than 9.5% for | 12 | | at least 3 consecutive months during the taxable year in | 13 | | which the credit is sought; | 14 | | (4) incurred by the accredited manufacturer for | 15 | | services on or after January 1, 2011; | 16 | | (5) incurred for the production stages of the | 17 | | manufacturing process; | 18 | | (6) limited to the first $25,000 of wages paid to or | 19 | | incurred for each employee of the manufacturing company; | 20 | | (7) exclusive of the salary or wages paid to or | 21 | | incurred for the 2 highest paid employees of the | 22 | | manufacturing company; | 23 | | (8) directly attributable to the accredited | 24 | | manufacturer; | 25 | | (9) paid in the tax year for which the applicant is | 26 | | claiming the credit or no later than 60 days after the end |
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| 1 | | of the tax year; and | 2 | | (10) paid for services rendered in Illinois. | 3 | | Section 20. Tax credit awards. Subject to the conditions | 4 | | set forth in this Act, an accredited manufacturer is entitled | 5 | | to a credit of 25% of all qualifying Illinois labor | 6 | | expenditures approved by the Department. | 7 | | Section 25. Accredited manufacturing company | 8 | | certification. Any taxpayer may request certification as an | 9 | | accredited manufacturing company by formal application to the | 10 | | Department. In determining whether to issue an accredited | 11 | | manufacturing company certificate, the Department must | 12 | | determine that all of the following conditions exist: | 13 | | (1) The taxpayer is engaged primarily in the business | 14 | | of manufacturing goods. | 15 | | (2) The taxpayer intends to employ workers in the State | 16 | | of Illinois. | 17 | | (3) The taxpayer provides health insurance to its | 18 | | employees. | 19 | | (4) The taxpayer provides to its employees either a | 20 | | pension plan or a 401k plan. | 21 | | (5) The taxpayer offers to its employees elder care | 22 | | benefits and a dependent care flexible spending account. | 23 | | (6) The taxpayer intends to expend a portion of its | 24 | | research and development budgets in the State of Illinois. |
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| 1 | | (7) The taxpayer must reside or be doing business in a | 2 | | county in the State that has had a seasonally adjusted | 3 | | unemployment rate of more than 9.5% for at least 3 | 4 | | consecutive months during the taxable year in which the | 5 | | credit is sought. | 6 | | Section 30. Issuance of manufacturing job destination tax | 7 | | credit certification. | 8 | | (a) In order to qualify for a tax credit under this Act, an | 9 | | accredited manufacturer must file, on forms prescribed by the | 10 | | Department, all information necessary to calculate the tax | 11 | | credit. | 12 | | (b) Upon satisfactory review of the application, the | 13 | | Department shall issue a manufacturing job destination tax | 14 | | credit certificate stating the amount of the tax credit. | 15 | | Section 35. Amount and duration of the credit. The amount | 16 | | of the credit awarded under this Act is based on the amount of | 17 | | qualifying Illinois labor expenditures approved by the | 18 | | Department in any tax year beginning on or after January 1, | 19 | | 2011 for the applicant. | 20 | | Section 40. Evaluation of tax credit program. The | 21 | | Department shall evaluate the tax credit program. The | 22 | | evaluation must include an assessment of the effectiveness of | 23 | | the program in creating and retaining jobs in Illinois and of |
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| 1 | | the revenue impact of the program and may include a review of | 2 | | the practices and experiences of other states or nations with | 3 | | similar programs. Upon completion of this evaluation, the | 4 | | Department shall determine the overall success of the program | 5 | | and may make a recommendation to extend, modify, or not extend | 6 | | the program based on this evaluation. | 7 | | Section 45. Program terms and conditions. Any documentary | 8 | | materials or data made available to or received by any agent or | 9 | | employee of the Department are confidential and are not public | 10 | | records to the extent that the materials or data consist of | 11 | | commercial or financial information regarding the | 12 | | manufacturing operation of the applicant for or recipient of | 13 | | any tax credit under this Act. | 14 | | Section 50. Appeals. If the Department denies a taxpayer | 15 | | certification under Section 25 of this Act, the denial must be | 16 | | in writing and must state the reasons for the denial. The | 17 | | taxpayer shall have 60 days after the first denial to correct | 18 | | any deficiency that was the reason for the initial denial of | 19 | | certification. | 20 | | If the Department again denies the certification, the | 21 | | taxpayer may appeal the second denial within 60 days after that | 22 | | denial and request a hearing. At the hearing, if the taxpayer | 23 | | shows, by preponderance of evidence, that he or she has | 24 | | complied with the requirements of this Section, then the |
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| 1 | | taxpayer shall be certified as an accredited manufacturer. | 2 | | If the taxpayer disagrees with the Department about the | 3 | | amount of the tax credit available for any tax year, the | 4 | | taxpayer may appeal the certification and request a hearing. If | 5 | | the taxpayer shows, by a preponderance of evidence, that he or | 6 | | she is entitled to a larger amount, the Department shall | 7 | | approve the larger amount. However, in no instance may the | 8 | | Department determine a lesser amount. | 9 | | The provisions of the Administrative Review Law, and the | 10 | | rules adopted pursuant thereto, apply to and govern all | 11 | | proceedings for the judicial review of this Act. | 12 | | Section 90. The Illinois Income Tax Act is amended by | 13 | | adding Section 221 as follows:
| 14 | | (35 ILCS 5/221 new) | 15 | | Sec. 221. Manufacturing job destination tax credit. For tax | 16 | | years beginning on or after January 1, 2011, a taxpayer who has | 17 | | been awarded a tax credit under the Manufacturing Job | 18 | | Destination Tax Credit Act is entitled to a credit against the | 19 | | taxes imposed under subsections (a) and (b) of Section 201 of | 20 | | this Act in an amount determined by the Department under the | 21 | | Manufacturing Job Destination Tax Credit Act. If the taxpayer | 22 | | is a partnership or Subchapter S corporation, the credit is | 23 | | allowed to the partners or shareholders in accordance with the | 24 | | determination of income and distributive share of income under |
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| 1 | | Sections 702 and 704 and Subchapter S of the Internal Revenue | 2 | | Code. The Department must prescribe rules to enforce and | 3 | | administer the provisions of this Section. This Section is | 4 | | exempt from the provisions of Section 250 of this Act. | 5 | | The credit may not be carried forward or back. In no event | 6 | | shall a credit under this Section reduce the taxpayer's | 7 | | liability to less than zero.
| 8 | | Section 99. Effective date. This Act takes effect upon | 9 | | becoming law.
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