101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB2542
 
Introduced , by Rep. Sonya M. Harper
 
SYNOPSIS AS INTRODUCED:



35 ILCS 5/216

 Amends the Illinois Income Tax Act. In a Section concerning the credit for wages paid to ex-felons, provides that, if the taxpayer is a business located in a census tract with a high rate of unemployment and violent crime, then (i) the amount of the credit shall be 10% (currently, 5%) of qualified wages paid by the taxpayer during the taxable year to the qualified ex-offender and (ii) the total credit allowed to that taxpayer with respect to each qualified ex-offender may not exceed $3,000 (currently, $1,500) for all taxable years. Provides that, in the case of those taxpayers, the requirement that the ex-felon must be hired by the taxpayer within 3 years after being released from an Illinois adult correctional center does not apply. 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,

3represented in the General Assembly:



4 Section 5. The Illinois Income Tax Act is amended by 
5changing Section 216 as follows:

6 (35 ILCS 5/216)
7 Sec. 216. Credit for wages paid to ex-felons.
8 (a) For each taxable year beginning on or after January 1, 
92007, each taxpayer is entitled to a credit against the tax 
10imposed by subsections (a) and (b) of Section 201 of this Act 
11in an amount equal to 5% of qualified wages paid by the 
12taxpayer during the taxable year to one or more Illinois 
13residents who are qualified ex-offenders. The total credit 
14allowed to a taxpayer with respect to each qualified 
15ex-offender may not exceed $1,500 for all taxable years. 
16Notwithstanding the provisions of this subsection (a), for 
17taxable years beginning on or after January 1, 2019, if the 
18taxpayer is a business located in a census tract with a high 
19rate of unemployment and violent crime, according to rules 
20adopted by the Department of Commerce and Economic Opportunity, 
21then (i) the amount of the credit shall be 10% of qualified 
22wages paid by the taxpayer during the taxable year to one or 
23more Illinois residents who are qualified ex-offenders and (ii) 
 
 
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1the total credit allowed to that taxpayer with respect to each 
2qualified ex-offender may not exceed $3,000 for all taxable 
3years. For partners, shareholders of Subchapter S 
4corporations, and owners of limited liability companies, if the 
5liability company is treated as a partnership for purposes of 
6federal and State income taxation, there shall be allowed a 
7credit under this Section to be determined in accordance with 
8the determination of income and distributive share of income 
9under Sections 702 and 704 and Subchapter S of the Internal 
10Revenue Code.
11 (b) For purposes of this Section, "qualified wages":
12  (1) includes only wages that are subject to federal 
13 unemployment tax under Section 3306 of the Internal Revenue 
14 Code, without regard to any dollar limitation contained in 
15 that Section;

16  (2) does not include any amounts paid or incurred by an 
17 employer for any period to any qualified ex-offender for 
18 whom the employer receives federally funded payments for 
19 on-the-job training of that qualified ex-offender for that 
20 period;
and

21  (3) includes only wages attributable to service 
22 rendered during the one-year period beginning with the day 
23 the qualified ex-offender begins work for the employer.

24 If the taxpayer has received any payment from a program 
25established under Section 482(e)(1) of the federal Social 
26Security Act with respect to a qualified ex-offender, then, for 
 
 
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1purposes of calculating the credit under this Section, the 
2amount of the qualified wages paid to that qualified 
3ex-offender must be reduced by the amount of the payment.

4 (c) For purposes of this Section, "qualified ex-offender" 
5means any person who:

6  (1) has been convicted of a crime in this State or of 
7 an offense in any other jurisdiction, not including any 
8 offense or attempted offense that would subject a person to 
9 registration under the Sex Offender Registration Act;
10  (2) was sentenced to a period of incarceration in an 
11 Illinois adult correctional center; and
12  (3) was hired by the taxpayer within 3 years after 
13 being released from an Illinois adult correctional center, 
14 except that this subparagraph (3) does not apply to a 
15 business located in a census tract with a high rate of 
16 unemployment and violent crime, according to rules adopted 
17 by the Department of Commerce and Economic Opportunity.
18 (d) In no event shall a credit under this Section reduce 
19the taxpayer's liability to less than zero. If the amount of 
20the credit exceeds the tax liability for the year, the excess 
21may be carried forward and applied to the tax liability of the 
225 taxable years following the excess credit year. The tax 
23credit shall be applied to the earliest year for which there is 
24a tax liability. If there are credits for more than one year 
25that are available to offset a liability, the earlier credit 
26shall be applied first.

 
 
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1 (e) This Section is exempt from the provisions of Section 
2250. 
3(Source: P.A. 98-165, eff. 8-5-13.)


4 Section 99. Effective date. This Act takes effect upon 
5becoming law.