Illinois General Assembly - Full Text of SB3882
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Full Text of SB3882  102nd General Assembly




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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 Article may be cited as the
5Recovery and Mental Health Tax Credit Act. References in this
6Article to "this Act" mean this Article.
7    Section 5. Findings.
8    (a) In the interest of reducing stigma and increasing the
9available pool of potential employees, the General Assembly
10finds and declares that those residents of Illinois diagnosed
11with mental illness and substance use disorders should be
12eligible for and encouraged to seek gainful employment.
13    (b) The General Assembly finds and declares that minority
14communities in this State have been more negatively impacted
15in employment opportunities for minority residents diagnosed
16with mental illness and substance use disorders and should
17receive additional employment opportunities and incentives for
18employing minority residents diagnosed with mental illness or
19substance use disorders.
20    (c) Due to the COVID-19 public health emergency, employers
21in the State of Illinois have suffered negative economic
22impacts, a loss in workforce, staffing difficulties, and have
23found it difficult to recruit new workers.



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1    (d) In the interest of providing additional employment
2opportunities for those residents of Illinois diagnosed with
3mental illness or substance use disorders and expanding the
4pool of potential workers in this State, the General Assembly
5finds and declares that certain qualified employers who employ
6eligible individuals should be eligible for a tax credit.
7    Section 10. Definitions. As used in this Act:
8    "Department" means the Department of Human Services.
9    "Eligible individual" means an individual with a substance
10use disorder, as that term is defined under Section 1-10 of the
11Substance Use Disorder Act, or an individual with a mental
12illness as that term is defined under Section 1-129 of the
13Mental Health and Developmental Disabilities Code, who is in a
14state of wellness and recovery where there is an abatement of
15signs and symptoms that characterize active substance use
16disorder or mental illness and has demonstrated to the
17qualified employer's satisfaction, pursuant to rules adopted
18by the Department, that he or she has completed a course of
19treatment or is currently in receipt of treatment for such
20substance use disorder or mental illness. A relapse in an
21individual's state of wellness shall not make the individual
22ineligible, so long as the individual shows a continued
23commitment to recovery that aligns with an individual's
24relapse prevention plan, discharge plan, or recovery plan.
25    "Qualified employer" means an employer operating within



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1the State that has received a certificate of tax credit from
2the Department after the Department has determined that the
4        (1) provides a recovery supportive environment for
5    their employees evidenced by a formal working relationship
6    with a substance use disorder treatment provider or
7    facility or mental health provider or facility, each as
8    may be licensed or certified within the State of Illinois,
9    and providing reasonable accommodation to the employees to
10    address their substance use disorder or mental illness,
11    all at no cost or expense to the eligible individual; and
12        (2) satisfies all other criteria in this Section and
13    established by the Department to participate in the
14    recovery tax program created hereunder.
15     "Taxpayer" means any individual, corporation,
16partnership, trust, or other entity subject to the Illinois
17income tax. For the purposes of this Act, 2 individuals filing
18a joint return shall be considered one taxpayer.
19    Section 15. Authorization of tax credit program for
20individuals in recovery from substance use disorders or mental
22    (a) For taxable years beginning on or after January 1,
232023, the Department is authorized to and shall establish and
24administer a recovery tax credit program to provide tax
25incentives to qualified employers who employ eligible



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1individuals in recovery from a substance use disorder or
2mental illness in part-time and full-time positions within
3Illinois. The Department shall award the tax credit by
4issuance of a certificate of tax credit to the qualified
5employer, who will present the certificate of tax credit to
6the Department of Revenue by attaching the certificate to its
7tax return, as a credit against the qualified employer's
8income tax liability in accordance with the Illinois Income
9Tax Act. The Department shall maintain an electronic listing
10of the certificates issued by which the Department of Revenue
11may verify tax credit certificates issued.
12    (b) To be a qualified employer, an employer must apply
13annually to the Department to claim a credit based upon
14eligible individuals employed during the preceding calendar
15year, using the forms prescribed by the Department. To be
16approved for a credit under this Act, the employer must:
17        (1) agree to provide to the Department the information
18    necessary to demonstrate that the employer has satisfied
19    program eligibility requirements and provided all
20    information requested or needed by the Department,
21    including the number of hours worked by the eligible
22    individual and other information necessary for the
23    Department to calculate the amount of credit permitted;
24    and
25        (2) agree to provide names, employer identification
26    numbers, amounts that the employer may claim, and other



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1    information necessary for the Department to calculate any
2    tax credit.
3    (c) To be an eligible individual, the individual must be
4diagnosed with or have been diagnosed with a substance use
5disorder or mental illness. Disclosure by the eligible
6individual of his or her mental illness or substance use
7disorder shall be completely voluntary and his or her health
8information may not be shared or disclosed under this Act
9without the eligible individual's express written consent. The
10eligible individual must have been employed by the qualified
11employer in this State for a minimum of 500 hours during the
12applicable calendar year and the tax credit may only begin on
13the date the eligible individual is hired by the qualified
14employer and ending on December 31 of that calendar year or the
15date that the eligible individual's employment with the
16qualified employer ends, whichever occurs first. Only one tax
17credit may be awarded for any eligible individual while
18employed by the same or related qualified employer. The hours
19of employment of 2 or more eligible individuals may not be
20aggregated to reach the minimum number of hours. If an
21eligible individual has worked in excess of 500 hours between
22the date of hiring and December 31 of that year, a qualified
23employer can elect to compute and claim a credit for such
24eligible individual in that year based on the hours worked by
25December 31. Alternatively, the qualified employer may elect
26to include such individual in the computation of the credit in



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1the year immediately succeeding the year in which the eligible
2individual was hired. In that case, the credit shall be
3computed on the basis of all hours worked by the eligible
4individual from the date of hire to the earlier of the last day
5of employment or December 31 of the succeeding year.
6    (d) If Department criteria and all other requirements are
7met, a qualified employer shall be entitled to a tax credit
8equal to the product of $1 and the number of hours worked by
9each eligible individual during the eligible individual's
10period of employment with the qualified employer. The tax
11credit awarded under this Act may not exceed $2,000 per
12eligible individual employed by the qualified employer in this
13State. In determining the amount of tax credit that any
14qualified employer may claim, the Department shall review all
15claims submitted for credit by all employers and, to the
16extent that the total amount claimed by employers exceeds the
17amount allocated for this program in that calendar year, shall
18issue tax credits on a pro rata basis corresponding to each
19qualified employer's share of the total amount claimed.
20    (e) The aggregate amount of all credits the Department may
21award under this Act in any calendar year may not exceed
23    (f) A taxpayer who is a qualified employer who has
24received a certificate of tax credit from the Department shall
25be allowed a credit against the tax imposed equal to the amount
26shown on such certificate of tax credit.



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1    (g) The credit must be claimed in the taxable year in which
2the tax credit certificate is issued. The credit cannot reduce
3a taxpayer's liability to less than zero. If the amount of the
4credit exceeds the tax liability for the year, the credit may
5not be carried forward.
6    (h) If the taxpayer is a partnership or Subchapter S
7corporation the credit shall be allowed to the partners or
8shareholders in accordance with the determination of income
9and distributive share of income under Sections 702 and 704
10and subchapter S of the Internal Revenue Code.
11    (i) In carrying out this Act, no patient-specific
12information shall be shared or disclosed. Any individual or
13patient-specific information collected by the Department or
14the Department of Revenue shall not be subject to public
15disclosure or Freedom of Information Act requests.
16    (j) The credit under this Act is exempt from the
17provisions of Section 250 of the Illinois Income Tax Act.
18    Section 20. Advisory Council on Mental Illness and
19Substance Use Disorder Impacts on Employment Opportunities
20within Minority Communities. The Secretary of the Department
21shall appoint the Advisory Council on Mental Illness and
22Substance Use Disorder Impacts on Employment Opportunities
23within Minority Communities, to be composed of 15 members,
24which shall include a balanced representation of recipients,
25services providers, employers, local governmental units,



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1community and welfare advocacy groups, academia, and the
2general public. The Advisory Council shall advise the
3Department regarding all aspects of employment impacts
4resulting from mental illnesses and substance use disorders
5within minority communities, tax credits, outreach, marketing,
6and education about the tax credit and employment
7opportunities, and other areas as deemed appropriate by the
8Secretary. In appointing the first Council, the Secretary
9shall name 8 members to terms of 2 years and 7 members to serve
10terms of 4 years, all of whom shall be appointed within 6
11months of the effective date of this Act. All members
12appointed thereafter shall serve terms of 4 years. Members
13shall serve without compensation other than reimbursement of
14expenses actually incurred in the performance of their
15official duties. At its first meeting, the Advisory Council
16shall select a chair from among its members. The Advisory
17Council shall meet at least quarterly and at other times at the
18call of the chair.
19    Section 25. Powers. The Department shall adopt rules for
20the administration of this Act. The Department may enter into
21an intergovernmental agreement with the Department of Revenue
22for the administration of this Act.
23    Section 30. The Illinois Income Tax Act is amended by
24adding Section 232 as follows:



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1    (35 ILCS 5/232 new)
2    Sec. 232. Recovery and Mental Health Tax Credit Act. For
3taxable years beginning on or after January 1, 2023, a
4taxpayer who has been awarded a credit under the Recovery and
5Mental Health Tax Credit Act is entitled to a credit against
6the tax imposed by subsections (a) and (b) of Section 201 as
7provided in that Act. This Section is exempt from the
8provisions of Section 250.