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| | 103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB1576 Introduced , by Rep. Adam M. Niemerg SYNOPSIS AS INTRODUCED:
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| 35 ILCS 405/2 | from Ch. 120, par. 405A-2 |
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Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Increases the exclusion amount to $8,000,000 for persons dying on or after January 1, 2024 (currently, $4,000,000). Effective immediately.
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| | A BILL FOR |
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| | HB1576 | | LRB103 25950 HLH 52302 b |
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| 1 | | AN ACT concerning revenue.
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| 2 | | Be it enacted by the People of the State of Illinois,
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| 3 | | represented in the General Assembly:
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| 4 | | Section 5. The Illinois Estate and Generation-Skipping |
| 5 | | Transfer Tax Act is amended by changing Section 2 as follows:
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| 6 | | (35 ILCS 405/2) (from Ch. 120, par. 405A-2)
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| 7 | | Sec. 2. Definitions.
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| 8 | | "Federal estate tax" means the tax due to the United |
| 9 | | States with respect
to a taxable transfer under Chapter 11 of |
| 10 | | the Internal Revenue Code.
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| 11 | | "Federal generation-skipping transfer tax" means the tax |
| 12 | | due to the
United States with respect to a taxable transfer |
| 13 | | under Chapter 13 of the
Internal Revenue Code.
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| 14 | | "Federal return" means the federal estate tax return with |
| 15 | | respect to the
federal estate tax and means the federal |
| 16 | | generation-skipping transfer tax
return
with respect to the |
| 17 | | federal generation-skipping transfer tax.
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| 18 | | "Federal transfer tax" means the federal estate tax or the |
| 19 | | federal
generation-skipping transfer tax.
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| 20 | | "Illinois estate tax" means the tax due to this State with |
| 21 | | respect to a
taxable transfer.
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| 22 | | "Illinois generation-skipping transfer tax" means the tax |
| 23 | | due to this State
with respect to a taxable transfer that gives |
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| 1 | | rise to a federal
generation-skipping transfer tax.
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| 2 | | "Illinois transfer tax" means the Illinois estate tax or |
| 3 | | the Illinois
generation-skipping transfer tax.
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| 4 | | "Internal Revenue Code" means, unless otherwise provided, |
| 5 | | the Internal
Revenue Code of 1986, as
amended from time to |
| 6 | | time.
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| 7 | | "Non-resident trust" means a trust that is not a resident |
| 8 | | of this State
for purposes of the Illinois Income Tax Act, as |
| 9 | | amended from time to time.
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| 10 | | "Person" means and includes any individual, trust, estate, |
| 11 | | partnership,
association, company or corporation.
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| 12 | | "Qualified heir" means a qualified heir as defined in |
| 13 | | Section 2032A(e)(1)
of the Internal Revenue Code.
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| 14 | | "Resident trust" means a trust that is a resident of this |
| 15 | | State for
purposes of the Illinois Income Tax Act, as amended |
| 16 | | from time to time.
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| 17 | | "State" means any state, territory or possession of the |
| 18 | | United States and
the District of Columbia.
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| 19 | | "State tax credit" means:
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| 20 | | (a) For persons dying on or after January 1, 2003 and
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| 21 | | through December 31, 2005, an amount
equal
to the full credit |
| 22 | | calculable under Section 2011 or Section 2604 of the
Internal |
| 23 | | Revenue
Code as the credit would have been computed and |
| 24 | | allowed under the Internal
Revenue
Code as in effect on |
| 25 | | December 31, 2001, without the reduction in the State
Death |
| 26 | | Tax
Credit as provided in Section 2011(b)(2) or the |
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| 1 | | termination of the State Death
Tax Credit
as provided in |
| 2 | | Section 2011(f) as enacted by the Economic Growth and Tax |
| 3 | | Relief
Reconciliation Act of 2001, but recognizing the |
| 4 | | increased applicable exclusion
amount
through December 31, |
| 5 | | 2005.
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| 6 | | (b) For persons dying after December 31, 2005 and on or |
| 7 | | before December 31,
2009, and for persons dying after December |
| 8 | | 31, 2010, an amount equal to the full
credit
calculable under |
| 9 | | Section 2011 or 2604 of the Internal Revenue Code as the
credit |
| 10 | | would
have been computed and allowed under the Internal |
| 11 | | Revenue Code as in effect on
December 31, 2001, without the |
| 12 | | reduction in the State Death Tax Credit as
provided in
Section |
| 13 | | 2011(b)(2) or the termination of the State Death Tax Credit as |
| 14 | | provided
in
Section 2011(f) as enacted by the Economic Growth |
| 15 | | and Tax Relief Reconciliation
Act of
2001, but recognizing the |
| 16 | | exclusion amount of only (i) $2,000,000 for persons dying |
| 17 | | prior to January 1, 2012, (ii) $3,500,000 for persons dying on |
| 18 | | or after January 1, 2012 and prior to January 1, 2013, and |
| 19 | | (iii) $4,000,000 for persons dying on or after January 1, 2013 |
| 20 | | and prior to January 1, 2024, and (iv) $8,000,000 for persons |
| 21 | | dying on or after January 1, 2024, and with reduction to the |
| 22 | | adjusted taxable estate for any qualified terminable interest |
| 23 | | property election as defined in subsection (b-1) of this |
| 24 | | Section.
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| 25 | | (b-1) The person required to file the Illinois return may |
| 26 | | elect on a timely filed Illinois return a marital deduction |
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| 1 | | for qualified terminable interest property under Section |
| 2 | | 2056(b)(7) of the Internal Revenue Code for purposes of the |
| 3 | | Illinois estate tax that is separate and independent of any |
| 4 | | qualified terminable interest property election for federal |
| 5 | | estate tax purposes. For purposes of the Illinois estate tax, |
| 6 | | the inclusion of property in the gross estate of a surviving |
| 7 | | spouse is the same as under Section 2044 of the Internal |
| 8 | | Revenue Code. |
| 9 | | In the case of any trust for which a State or federal |
| 10 | | qualified terminable interest property election is made, the |
| 11 | | trustee may not retain non-income producing assets for more |
| 12 | | than a reasonable amount of time without the consent of the |
| 13 | | surviving spouse.
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| 14 | | "Taxable transfer" means an event that gives rise to a |
| 15 | | state tax credit,
including any credit as a result of the |
| 16 | | imposition of an
additional tax under Section 2032A(c) of the |
| 17 | | Internal Revenue Code.
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| 18 | | "Transferee" means a transferee within the meaning of |
| 19 | | Section 2603(a)(1)
and Section 6901(h) of the Internal Revenue |
| 20 | | Code.
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| 21 | | "Transferred property" means:
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| 22 | | (1) With respect to a taxable transfer occurring at |
| 23 | | the death of an
individual, the
deceased individual's |
| 24 | | gross estate as defined in Section 2031 of the
Internal |
| 25 | | Revenue Code.
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| 26 | | (2) With respect to a taxable transfer occurring as a |
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| 1 | | result of a
taxable termination as defined in Section |
| 2 | | 2612(a) of the Internal Revenue Code,
the taxable amount |
| 3 | | determined under Section 2622(a) of the Internal Revenue
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| 4 | | Code.
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| 5 | | (3) With respect to a taxable transfer occurring as a |
| 6 | | result of a
taxable distribution as defined in Section |
| 7 | | 2612(b) of the Internal Revenue Code,
the taxable amount |
| 8 | | determined under Section 2621(a) of the Internal Revenue
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| 9 | | Code.
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| 10 | | (4) With respect to an event which causes the |
| 11 | | imposition of an
additional estate tax under Section |
| 12 | | 2032A(c) of the Internal Revenue Code,
the
qualified real |
| 13 | | property that was disposed of or which ceased to be used |
| 14 | | for
the qualified use, within the meaning of Section |
| 15 | | 2032A(c)(1) of the Internal
Revenue Code.
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| 16 | | "Trust" includes a trust as defined in Section 2652(b)(1) |
| 17 | | of the Internal
Revenue Code.
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| 18 | | (Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11; |
| 19 | | 97-636, eff. 6-1-12.)
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| 20 | | Section 99. Effective date. This Act takes effect upon |
| 21 | | becoming law.
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