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Rep. John E. Bradley
Filed: 5/30/2014
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| 1 | | AMENDMENT TO SENATE BILL 346
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| 2 | | AMENDMENT NO. ______. Amend Senate Bill 346 by replacing |
| 3 | | everything after the enacting clause with the following:
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| 4 | | "Section 5. The Economic Development for a Growing Economy |
| 5 | | Tax Credit Act is amended by changing Sections 5-5, 5-15, 5-20, |
| 6 | | and 5-50 and by adding Section 5-37 as follows:
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| 7 | | (35 ILCS 10/5-5)
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| 8 | | Sec. 5-5. Definitions. As used in this Act:
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| 9 | | "Agreement" means the Agreement between a Taxpayer and the |
| 10 | | Department under
the provisions of Section 5-50 of this Act.
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| 11 | | "Applicant" means a Taxpayer that is operating a business |
| 12 | | located or that
the Taxpayer plans to locate within the State |
| 13 | | of Illinois and that is engaged
in interstate or intrastate |
| 14 | | commerce for the purpose of manufacturing,
processing, |
| 15 | | assembling, warehousing, or distributing products, conducting
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| 16 | | research and development, providing tourism services, or |
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| 1 | | providing services
in interstate commerce, office industries, |
| 2 | | or agricultural processing, but
excluding retail, retail food, |
| 3 | | health, or professional services.
"Applicant" does not include |
| 4 | | a Taxpayer who closes or
substantially reduces an operation at |
| 5 | | one location in the State and relocates
substantially the same |
| 6 | | operation to another location in the State. This does
not |
| 7 | | prohibit a Taxpayer from expanding its operations at another |
| 8 | | location in
the State, provided that existing operations of a |
| 9 | | similar nature located within
the State are not closed or |
| 10 | | substantially reduced. This also does not prohibit
a Taxpayer |
| 11 | | from moving its operations from one location in the State to |
| 12 | | another
location in the State for the purpose of expanding the |
| 13 | | operation provided that
the Department determines that |
| 14 | | expansion cannot reasonably be accommodated
within the |
| 15 | | municipality in which the business is located, or in the case |
| 16 | | of a
business located in an incorporated area of the county, |
| 17 | | within the county in
which the business is located, after |
| 18 | | conferring with the chief elected
official of the municipality |
| 19 | | or county and taking into consideration any
evidence offered by |
| 20 | | the municipality or county regarding the ability to
accommodate |
| 21 | | expansion within the municipality or county.
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| 22 | | "Committee" means the Illinois Business Investment |
| 23 | | Committee created under
Section 5-25 of this Act within the |
| 24 | | Illinois Economic Development Board.
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| 25 | | "Credit" means the amount agreed to between the Department |
| 26 | | and Applicant
under this Act, but not to exceed the Incremental |
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| 1 | | Income Tax attributable to
the Applicant's project. However, |
| 2 | | for agreements entered into on or after the effective date of |
| 3 | | this amendatory Act of the 98th General Assembly, if the |
| 4 | | Applicant's project includes retained employees, then the |
| 5 | | amount of the Credit may also include an amount agreed to |
| 6 | | between the Department and the Applicant based on the severity |
| 7 | | of the poverty or unemployment in the geographic area in which |
| 8 | | the Applicant's project is located or the retained employees |
| 9 | | reside. That amount may not be more than 40% of the total |
| 10 | | amount withheld during the taxable
year under Article 7 of the |
| 11 | | Illinois Income Tax Act from the compensation of retained |
| 12 | | employees. For the purposes of this definition, "retained |
| 13 | | employee" means a full-time employee of the Applicant who is |
| 14 | | employed at the project location and whose job is identified in |
| 15 | | the application as being at risk of being relocated outside of |
| 16 | | Illinois if the Applicant does not receive a credit under this |
| 17 | | Act.
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| 18 | | "Department" means the Department of Commerce and Economic |
| 19 | | Opportunity.
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| 20 | | "Director" means the Director of Commerce and Economic |
| 21 | | Opportunity.
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| 22 | | "Full-time Employee" means an individual who is employed |
| 23 | | for consideration
for at least 35 hours each week or who |
| 24 | | renders any other standard of service
generally accepted by |
| 25 | | industry custom or practice as full-time employment. An |
| 26 | | individual for whom a W-2 is issued by a Professional Employer |
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| 1 | | Organization (PEO) is a full-time employee if employed in the |
| 2 | | service of the Applicant for consideration for at least 35 |
| 3 | | hours each week or who renders any other standard of service |
| 4 | | generally accepted by industry custom or practice as full-time |
| 5 | | employment to Applicant.
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| 6 | | "Geographic area of high poverty or high unemployment" |
| 7 | | means a census tract in which more than 20% of the
residents |
| 8 | | live below the poverty level, as determined by the most recent |
| 9 | | data from the United States Census Bureau, or the average |
| 10 | | unemployment rate for that census tract exceeds the average |
| 11 | | unemployment rate for the State by 3% or more. |
| 12 | | "Incremental Income Tax" means the total amount withheld |
| 13 | | during the taxable
year from the compensation of New Employees |
| 14 | | under Article 7 of the Illinois
Income Tax Act arising from |
| 15 | | employment at a project that is the subject of an
Agreement.
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| 16 | | "New Employee" means:
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| 17 | | (a) A Full-time Employee first employed by a Taxpayer |
| 18 | | in the project
that is the subject of an Agreement and who |
| 19 | | is hired after the Taxpayer
enters into the tax credit |
| 20 | | Agreement.
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| 21 | | (b) The term "New Employee" does not include:
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| 22 | | (1) an employee of the Taxpayer who performs a job |
| 23 | | that was previously
performed by another employee, if |
| 24 | | that job existed for at least 6
months before hiring |
| 25 | | the employee;
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| 26 | | (2) an employee of the Taxpayer who was previously |
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| 1 | | employed in
Illinois by a Related Member of the |
| 2 | | Taxpayer and whose employment was
shifted to the |
| 3 | | Taxpayer after the Taxpayer entered into the tax credit
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| 4 | | Agreement; or
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| 5 | | (3) a child, grandchild, parent, or spouse, other |
| 6 | | than a spouse who
is legally separated from the |
| 7 | | individual, of any individual who has a direct
or an |
| 8 | | indirect ownership interest of at least 5% in the |
| 9 | | profits, capital, or
value of the Taxpayer.
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| 10 | | (c) Notwithstanding paragraph (1) of subsection (b), |
| 11 | | an employee may be
considered a New Employee under the |
| 12 | | Agreement if the employee performs a job
that was |
| 13 | | previously performed by an employee who was:
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| 14 | | (1) treated under the Agreement as a New Employee; |
| 15 | | and
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| 16 | | (2) promoted by the Taxpayer to another job.
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| 17 | | (d) Notwithstanding subsection (a), the Department may |
| 18 | | award Credit to an
Applicant with respect to an employee |
| 19 | | hired prior to the date of the Agreement
if:
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| 20 | | (1) the Applicant is in receipt of a letter from |
| 21 | | the Department stating
an
intent to enter into a credit |
| 22 | | Agreement;
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| 23 | | (2) the letter described in paragraph (1) is issued |
| 24 | | by the
Department not later than 15 days after the |
| 25 | | effective date of this Act; and
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| 26 | | (3) the employee was hired after the date the |
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| 1 | | letter described in
paragraph (1) was issued.
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| 2 | | "Noncompliance Date" means, in the case of a Taxpayer that |
| 3 | | is not complying
with the requirements of the Agreement or the |
| 4 | | provisions of this Act, the day
following the last date upon |
| 5 | | which the Taxpayer was in compliance with the
requirements of |
| 6 | | the Agreement and the provisions of this Act, as determined
by |
| 7 | | the Director, pursuant to Section 5-65.
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| 8 | | "Pass Through Entity" means an entity that is exempt from |
| 9 | | the tax under
subsection (b) or (c) of Section 205 of the |
| 10 | | Illinois Income Tax Act.
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| 11 | | "Professional Employer Organization" (PEO) means an |
| 12 | | employee leasing company, as defined in Section 206.1(A)(2) of |
| 13 | | the Illinois Unemployment Insurance Act.
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| 14 | | "Related Member" means a person that, with respect to the |
| 15 | | Taxpayer during
any portion of the taxable year, is any one of |
| 16 | | the following:
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| 17 | | (1) An individual stockholder, if the stockholder and |
| 18 | | the members of the
stockholder's family (as defined in |
| 19 | | Section 318 of the Internal Revenue Code)
own directly, |
| 20 | | indirectly, beneficially, or constructively, in the |
| 21 | | aggregate,
at least 50% of the value of the Taxpayer's |
| 22 | | outstanding stock.
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| 23 | | (2) A partnership, estate, or trust and any partner or |
| 24 | | beneficiary,
if the partnership, estate, or trust, and its |
| 25 | | partners or beneficiaries own
directly, indirectly, |
| 26 | | beneficially, or constructively, in the aggregate, at
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| 1 | | least 50% of the profits, capital, stock, or value of the
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| 2 | | Taxpayer.
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| 3 | | (3) A corporation, and any party related to the |
| 4 | | corporation in a manner
that would require an attribution |
| 5 | | of stock from the corporation to the
party or from the |
| 6 | | party to the corporation under the attribution rules
of |
| 7 | | Section 318 of the Internal Revenue Code, if the Taxpayer |
| 8 | | owns
directly, indirectly, beneficially, or constructively |
| 9 | | at least
50% of the value of the corporation's outstanding |
| 10 | | stock.
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| 11 | | (4) A corporation and any party related to that |
| 12 | | corporation in a manner
that would require an attribution |
| 13 | | of stock from the corporation to the party or
from the |
| 14 | | party to the corporation under the attribution rules of |
| 15 | | Section 318 of
the Internal Revenue Code, if the |
| 16 | | corporation and all such related parties own
in the |
| 17 | | aggregate at least 50% of the profits, capital, stock, or |
| 18 | | value of the
Taxpayer.
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| 19 | | (5) A person to or from whom there is attribution of |
| 20 | | stock ownership
in accordance with Section 1563(e) of the |
| 21 | | Internal Revenue Code, except,
for purposes of determining |
| 22 | | whether a person is a Related Member under
this paragraph, |
| 23 | | 20% shall be substituted for 5% wherever 5% appears in
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| 24 | | Section 1563(e) of the Internal Revenue Code.
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| 25 | | "Taxpayer" means an individual, corporation, partnership, |
| 26 | | or other entity
that has any Illinois Income Tax liability.
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| 1 | | (Source: P.A. 94-793, eff. 5-19-06; 95-375, eff. 8-23-07.)
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| 2 | | (35 ILCS 10/5-15) |
| 3 | | Sec. 5-15. Tax Credit Awards. Subject to the conditions set |
| 4 | | forth in this
Act, a Taxpayer is
entitled to a Credit against |
| 5 | | or, as described in subsection (g) of this Section, a payment |
| 6 | | towards taxes imposed pursuant to subsections (a) and (b)
of |
| 7 | | Section 201 of the Illinois
Income Tax Act that may be imposed |
| 8 | | on the Taxpayer for a taxable year beginning
on or
after |
| 9 | | January 1, 1999,
if the Taxpayer is awarded a Credit by the |
| 10 | | Department under this Act for that
taxable year. |
| 11 | | (a) The Department shall make Credit awards under this Act |
| 12 | | to foster job
creation and retention in Illinois. |
| 13 | | (b) A person that proposes a project to create new jobs in |
| 14 | | Illinois must
enter into an Agreement with the
Department for |
| 15 | | the Credit under this Act. |
| 16 | | (c) The Credit shall be claimed for the taxable years |
| 17 | | specified in the
Agreement. |
| 18 | | (d) The Credit shall not exceed the Incremental Income Tax |
| 19 | | attributable to
the project that is the subject of the |
| 20 | | Agreement. |
| 21 | | (e) Nothing herein shall prohibit a Tax Credit Award to an |
| 22 | | Applicant that uses a PEO if all other award criteria are |
| 23 | | satisfied.
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| 24 | | (f) Subject to the requirements of paragraph (5) of this |
| 25 | | subsection (f), in In lieu of the Credit allowed under this Act |
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| 1 | | against the taxes imposed pursuant to subsections (a) and (b) |
| 2 | | of Section 201 of the Illinois Income Tax Act for any taxable |
| 3 | | year ending on or after December 31, 2009, the Taxpayer may |
| 4 | | elect to claim the Credit against its obligation to pay over |
| 5 | | withholding under Section 704A of the Illinois Income Tax Act. |
| 6 | | (1) The election under this subsection (f) may be made |
| 7 | | only by a Taxpayer that (i) is primarily engaged in one of |
| 8 | | the following business activities: water purification and |
| 9 | | treatment, motor vehicle metal stamping, automobile |
| 10 | | manufacturing, automobile and light duty motor vehicle |
| 11 | | manufacturing, motor vehicle manufacturing, light truck |
| 12 | | and utility vehicle manufacturing, heavy duty truck |
| 13 | | manufacturing, motor vehicle body manufacturing, cable |
| 14 | | television infrastructure design or manufacturing, or |
| 15 | | wireless telecommunication or computing terminal device |
| 16 | | design or manufacturing for use on public networks and (ii) |
| 17 | | meets the following criteria: |
| 18 | | (A) the Taxpayer (i) had an Illinois net loss or an |
| 19 | | Illinois net loss deduction under Section 207 of the |
| 20 | | Illinois Income Tax Act for the taxable year in which |
| 21 | | the Credit is awarded, (ii) employed a minimum of 1,000 |
| 22 | | full-time employees in this State during the taxable |
| 23 | | year in which the Credit is awarded, (iii) has an |
| 24 | | Agreement under this Act on December 14, 2009 (the |
| 25 | | effective date of Public Act 96-834), and (iv) is in |
| 26 | | compliance with all provisions of that Agreement; |
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| 1 | | (B) the Taxpayer (i) had an Illinois net loss or an |
| 2 | | Illinois net loss deduction under Section 207 of the |
| 3 | | Illinois Income Tax Act for the taxable year in which |
| 4 | | the Credit is awarded, (ii) employed a minimum of 1,000 |
| 5 | | full-time employees in this State during the taxable |
| 6 | | year in which the Credit is awarded, and (iii) has |
| 7 | | applied for an Agreement within 365 days after December |
| 8 | | 14, 2009 (the effective date of Public Act 96-834); |
| 9 | | (C) the Taxpayer (i) had an Illinois net operating |
| 10 | | loss carryforward under Section 207 of the Illinois |
| 11 | | Income Tax Act in a taxable year ending during calendar |
| 12 | | year 2008, (ii) has applied for an Agreement within 150 |
| 13 | | days after the effective date of this amendatory Act of |
| 14 | | the 96th General Assembly, (iii) creates at least 400 |
| 15 | | new jobs in Illinois, (iv) retains at least 2,000 jobs |
| 16 | | in Illinois that would have been at risk of relocation |
| 17 | | out of Illinois over a 10-year period, and (v) makes a |
| 18 | | capital investment of at least $75,000,000; |
| 19 | | (D) the Taxpayer (i) had an Illinois net operating |
| 20 | | loss carryforward under Section 207 of the Illinois |
| 21 | | Income Tax Act in a taxable year ending during calendar |
| 22 | | year 2009, (ii) has applied for an Agreement within 150 |
| 23 | | days after the effective date of this amendatory Act of |
| 24 | | the 96th General Assembly, (iii) creates at least 150 |
| 25 | | new jobs, (iv) retains at least 1,000 jobs in Illinois |
| 26 | | that would have been at risk of relocation out of |
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| 1 | | Illinois over a 10-year period, and (v) makes a capital |
| 2 | | investment of at least $57,000,000; or |
| 3 | | (E) the Taxpayer (i) employed at least 2,500 |
| 4 | | full-time employees in the State during the year in |
| 5 | | which the Credit is awarded, (ii) commits to make at |
| 6 | | least $500,000,000 in combined capital improvements |
| 7 | | and project costs under the Agreement, (iii) applies |
| 8 | | for an Agreement between January 1, 2011 and June 30, |
| 9 | | 2011, (iv) executes an Agreement for the Credit during |
| 10 | | calendar year 2011, and (v) was incorporated no more |
| 11 | | than 5 years before the filing of an application for an |
| 12 | | Agreement. |
| 13 | | (1.5) The election under this subsection (f) may also |
| 14 | | be made by a Taxpayer for any Credit awarded pursuant to an |
| 15 | | agreement that was executed between January 1, 2011 and |
| 16 | | June 30, 2011, if the Taxpayer (i) is primarily engaged in |
| 17 | | the manufacture of inner tubes or tires, or both, from |
| 18 | | natural and synthetic rubber, (ii) employs a minimum of |
| 19 | | 2,400 full-time employees in Illinois at the time of |
| 20 | | application, (iii) creates at least 350 full-time jobs and |
| 21 | | retains at least 250 full-time jobs in Illinois that would |
| 22 | | have been at risk of being created or retained outside of |
| 23 | | Illinois, and (iv) makes a capital investment of at least |
| 24 | | $200,000,000 at the project location. |
| 25 | | (1.6) The election under this subsection (f) may also |
| 26 | | be made by a Taxpayer for any Credit awarded pursuant to an |
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| 1 | | agreement that was executed within 150 days after the |
| 2 | | effective date of this amendatory Act of the 97th General |
| 3 | | Assembly, if the Taxpayer (i) is primarily engaged in the |
| 4 | | operation of a discount department store, (ii) maintains |
| 5 | | its corporate headquarters in Illinois, (iii) employs a |
| 6 | | minimum of 4,250 full-time employees at its corporate |
| 7 | | headquarters in Illinois at the time of application, (iv) |
| 8 | | retains at least 4,250 full-time jobs in Illinois that |
| 9 | | would have been at risk of being relocated outside of |
| 10 | | Illinois, (v) had a minimum of $40,000,000,000 in total |
| 11 | | revenue in 2010, and (vi) makes a capital investment of at |
| 12 | | least $300,000,000 at the project location. |
| 13 | | (1.7) Notwithstanding any other provision of law, the |
| 14 | | election under this subsection (f) may also be made by a |
| 15 | | Taxpayer for any Credit awarded pursuant to an agreement |
| 16 | | that was executed or applied for on or after July 1, 2011 |
| 17 | | and on or before March 31, 2012, if the Taxpayer is |
| 18 | | primarily engaged in the manufacture of original and |
| 19 | | aftermarket filtration parts and products for automobiles, |
| 20 | | motor vehicles, light duty motor vehicles, light trucks and |
| 21 | | utility vehicles, and heavy duty trucks, (ii) employs a |
| 22 | | minimum of 1,000 full-time employees in Illinois at the |
| 23 | | time of application, (iii) creates at least 250 full-time |
| 24 | | jobs in Illinois, (iv) relocates its corporate |
| 25 | | headquarters to Illinois from another state, and (v) makes |
| 26 | | a capital investment of at least $4,000,000 at the project |
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| 1 | | location. |
| 2 | | (2) An election under this subsection shall allow the |
| 3 | | credit to be taken against payments otherwise due under |
| 4 | | Section 704A of the Illinois Income Tax Act during the |
| 5 | | first calendar year beginning after the end of the taxable |
| 6 | | year in which the credit is awarded under this Act. |
| 7 | | (3) The election shall be made in the form and manner |
| 8 | | required by the Illinois Department of Revenue and, once |
| 9 | | made, shall be irrevocable. |
| 10 | | (4) If a Taxpayer who meets the requirements of |
| 11 | | subparagraph (A) of paragraph (1) of this subsection (f) |
| 12 | | elects to claim the Credit against its withholdings as |
| 13 | | provided in this subsection (f), then, on and after the |
| 14 | | date of the election, the terms of the Agreement between |
| 15 | | the Taxpayer and the Department may not be further amended |
| 16 | | during the term of the Agreement. |
| 17 | | (5) With respect to Agreements entered into on or after |
| 18 | | the effective date of this amendatory Act of the 98th |
| 19 | | General Assembly, no Taxpayer may make an election under |
| 20 | | this subsection (f) unless all of the following conditions |
| 21 | | are met: |
| 22 | | (A) The General Assembly authorizes that election |
| 23 | | by law. |
| 24 | | (B) The Taxpayer applies with the Department for a |
| 25 | | Credit prior to the date the General Assembly |
| 26 | | authorizes the election. |
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| 1 | | (C) The Taxpayer (i) agrees to hire a specified |
| 2 | | number of New Employees at a project location in a |
| 3 | | geographic area of high poverty or high unemployment or |
| 4 | | (ii) agrees to hire a specified number of New Employees |
| 5 | | at least 65% of whom reside in a geographic area of |
| 6 | | high poverty or high unemployment; the number of New |
| 7 | | Employees hired under item (ii) shall be verified |
| 8 | | annually by the Department through payroll information |
| 9 | | submitted by the Taxpayer; for the purposes of this |
| 10 | | subparagraph (C), an employee who is retained by the |
| 11 | | Taxpayer is not considered a New Employee. |
| 12 | | (D) The Taxpayer files a statement with the |
| 13 | | Department at the time of the application for the |
| 14 | | Credit containing the following information from the |
| 15 | | Taxpayer's Illinois income tax return for the 2 years |
| 16 | | immediately preceding the date of the application; in |
| 17 | | addition, the Taxpayer shall file an additional |
| 18 | | statement with the Department containing the same |
| 19 | | information for the first taxable year with respect to |
| 20 | | which an election is made under this subsection (f) and |
| 21 | | for each subsequent tax year covered by the Agreement: |
| 22 | | (i) the Taxpayer's base income, as calculated |
| 23 | | under Section 203 of the Illinois Income Tax Act; |
| 24 | | (ii) the apportionment factor to the State for |
| 25 | | the Taxpayer; |
| 26 | | (iii) the total business income of the |
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| 1 | | Taxpayer apportioned to the State; |
| 2 | | (iv) the Illinois net operating loss deduction |
| 3 | | for the Taxpayer, if any; |
| 4 | | (v) the total non-business income of the |
| 5 | | Taxpayer and the amount of the Taxpayer's |
| 6 | | non-business income allocated to the State; |
| 7 | | (vi) the net income of the Taxpayer; |
| 8 | | (vii) the Taxpayer's total State income tax |
| 9 | | liability before credits; |
| 10 | | (viii) the Taxpayer's net income tax |
| 11 | | liability; |
| 12 | | (ix) the Taxpayer's total personal property |
| 13 | | tax replacement tax liability before credits; |
| 14 | | (x) the Taxpayer's net personal property tax |
| 15 | | replacement tax liability; and |
| 16 | | (xi) tax credits claimed by the Taxpayer, with |
| 17 | | each credit individually enumerated. |
| 18 | | Each additional statement required under this |
| 19 | | subparagraph (D) for a taxable year shall be filed no |
| 20 | | later than the earlier of 30 days after (i) the |
| 21 | | Taxpayer files its Illinois income tax return for that |
| 22 | | taxable year, (ii) the due date (including extensions) |
| 23 | | for the filing of that return, or (iii) in the case of |
| 24 | | the additional statement covering the taxable year in |
| 25 | | which an election is made, the date the election is |
| 26 | | made under this subsection (f). |
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| 1 | | (E) The Taxpayer files a statement with the |
| 2 | | Department reporting any changes to the information |
| 3 | | required to be reported under subparagraph (D) that |
| 4 | | were reported by the Taxpayer on an amended return for |
| 5 | | the taxable year or that were made by the Department of |
| 6 | | Revenue; the report required under this subparagraph |
| 7 | | (E) must be filed within 30 days after the Taxpayer |
| 8 | | files the amended return or within 30 days after the |
| 9 | | date on which all proceedings in court for review of |
| 10 | | the changes made by the Department of Revenue have |
| 11 | | terminated or the time for taking thereof has expired |
| 12 | | without such proceedings being instituted. |
| 13 | | (F) The Agreement includes a consent by the |
| 14 | | Taxpayer to allow the Department to confirm with the |
| 15 | | Department of Revenue the accuracy of the information |
| 16 | | required to be reported under subparagraphs (D) and |
| 17 | | (E). |
| 18 | | (g) A pass-through entity that has been awarded a credit |
| 19 | | under this Act, its shareholders, or its partners may treat |
| 20 | | some or all of the credit awarded pursuant to this Act as a tax |
| 21 | | payment for purposes of the Illinois Income Tax Act. The term |
| 22 | | "tax payment" means a payment as described in Article 6 or |
| 23 | | Article 8 of the Illinois Income Tax Act or a composite payment |
| 24 | | made by a pass-through entity on behalf of any of its |
| 25 | | shareholders or partners to satisfy such shareholders' or |
| 26 | | partners' taxes imposed pursuant to subsections (a) and (b) of |
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| 1 | | Section 201 of the Illinois Income Tax Act. In no event shall |
| 2 | | the amount of the award credited pursuant to this Act exceed |
| 3 | | the Illinois income tax liability of the pass-through entity or |
| 4 | | its shareholders or partners for the taxable year. |
| 5 | | (Source: P.A. 96-834, eff. 12-14-09; 96-836, eff. 12-16-09; |
| 6 | | 96-905, eff. 6-4-10; 96-1000, eff. 7-2-10; 96-1534, eff. |
| 7 | | 3-4-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12.)
|
| 8 | | (35 ILCS 10/5-20)
|
| 9 | | Sec. 5-20. Application for a project to create and retain |
| 10 | | new jobs.
|
| 11 | | (a) Any Taxpayer proposing a project located or planned to |
| 12 | | be located in
Illinois may request consideration
for |
| 13 | | designation of its project, by formal written letter of request |
| 14 | | or by
formal application to the Department,
in which the |
| 15 | | Applicant states its intent to make at least a specified level |
| 16 | | of
investment and
intends to hire or retain a
specified number |
| 17 | | of full-time employees at a designated location in Illinois.
As
|
| 18 | | circumstances require, the
Department may require a formal |
| 19 | | application from an Applicant and a formal
letter of request |
| 20 | | for
assistance. Each application must contain an affidavit |
| 21 | | signed by the Taxpayer's chief executive officer or chief |
| 22 | | financial officer, or an individual holding an equivalent |
| 23 | | position in the organization, stating that, but for the Credit, |
| 24 | | the Taxpayer would not locate the project in the State.
|
| 25 | | (b) In order to qualify for Credits under this Act, an |
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| 1 | | Applicant's project
must:
|
| 2 | | (1) except as provided in paragraphs (2) and (3), |
| 3 | | involve an investment of at least $5,000,000 in capital |
| 4 | | improvements
to be placed in service and to employ at least |
| 5 | | 25 New Employees within the
State as a direct result of the |
| 6 | | project;
|
| 7 | | (2) involve an investment of at least an amount (to be |
| 8 | | expressly specified
by the Department and the Committee) in |
| 9 | | capital improvements to be placed in
service and will |
| 10 | | employ at least an amount (to be expressly specified by the
|
| 11 | | Department and the Committee) of New Employees
within the |
| 12 | | State, provided that the Department and the Committee have
|
| 13 | | determined that the project will provide a substantial |
| 14 | | economic benefit to the
State; or |
| 15 | | (3) if the applicant has 100 or fewer employees, then |
| 16 | | the applicant is not subject to the capital improvement |
| 17 | | requirements set forth in paragraph (1) of this subsection, |
| 18 | | but the applicant's project must involve an investment of |
| 19 | | at least $1,000,000 in capital improvements to be placed in |
| 20 | | service and to employ at least 5 New Employees within the |
| 21 | | State as a direct result of the project.
|
| 22 | | (c) After receipt of an application, the Department may |
| 23 | | enter into an
Agreement with the Applicant if the
application |
| 24 | | is accepted in accordance with Section 5-25.
|
| 25 | | (Source: P.A. 93-882, eff. 1-1-05.)
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| 1 | | (35 ILCS 10/5-37 new) |
| 2 | | Sec. 5-37. Chief Executive Officer; Board of Directors; |
| 3 | | fiduciary duty. Notwithstanding any provision of law to the |
| 4 | | contrary, neither the Taxpayer's Chief Executive Officer nor |
| 5 | | any member of the Taxpayer's Board of Directors may be deemed |
| 6 | | to have breached any fiduciary or other duty and are immune |
| 7 | | from any liability for breach of fiduciary duty related to the |
| 8 | | Taxpayer's actions in (i) keeping its corporate headquarters or |
| 9 | | any office, plant, factory, or worksite of the corporation in |
| 10 | | Illinois pursuant to an agreement under this Act or (ii) |
| 11 | | relocating the Taxpayer's corporate headquarters or any |
| 12 | | office, plant, factory, or worksite of the corporation to |
| 13 | | Illinois pursuant to an agreement under this Act, if the Chief |
| 14 | | Executive Officer or member acts in good faith and is under the |
| 15 | | belief that he or she is serving the best interests of the |
| 16 | | corporation and is considering the welfare and interests of the |
| 17 | | corporation and its workforce in taking those actions.
|
| 18 | | (35 ILCS 10/5-50)
|
| 19 | | Sec. 5-50. Contents of Agreements with Applicants. The |
| 20 | | Department shall
enter into an Agreement with an
Applicant that |
| 21 | | is awarded a Credit under this Act. The Agreement
must include |
| 22 | | all of the following:
|
| 23 | | (1) A detailed description of the project that is the |
| 24 | | subject of the
Agreement, including the location and amount |
| 25 | | of the investment and jobs created
or retained.
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| 1 | | (2) The duration of the Credit and the first taxable |
| 2 | | year for which
the Credit may be claimed.
|
| 3 | | (3) The Credit amount that will be allowed for each |
| 4 | | taxable year.
|
| 5 | | (4) A requirement that the Taxpayer shall maintain |
| 6 | | operations at the
project location that shall be stated as |
| 7 | | a minimum number of years not to
exceed 10.
|
| 8 | | (5) A specific method for determining the number of New |
| 9 | | Employees
employed during a taxable year.
|
| 10 | | (6) A requirement that the Taxpayer shall annually |
| 11 | | report to the
Department the number of New Employees,
the |
| 12 | | home addresses of any retained employees, the Incremental |
| 13 | | Income Tax
withheld in connection with the New Employees |
| 14 | | and retained employees, and any other
information the |
| 15 | | Director needs to perform the Director's duties under
this |
| 16 | | Act.
|
| 17 | | (7) A requirement that the Director is authorized to |
| 18 | | verify with the
appropriate State agencies the amounts |
| 19 | | reported under paragraph
(6), and after doing so shall |
| 20 | | issue a certificate to the Taxpayer
stating that the |
| 21 | | amounts have been verified.
|
| 22 | | (8) A requirement that the Taxpayer shall provide |
| 23 | | written
notification to the Director not more than 30
days |
| 24 | | after the Taxpayer makes or receives a proposal that would
|
| 25 | | transfer the Taxpayer's State tax liability obligations to |
| 26 | | a
successor Taxpayer.
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| 1 | | (9) A detailed description of the number of New |
| 2 | | Employees to be
hired, and the occupation and
payroll of |
| 3 | | the full-time jobs to be created or retained as a result of |
| 4 | | the
project.
|
| 5 | | (10) The minimum investment the business enterprise |
| 6 | | will make in
capital improvements, the time period
for |
| 7 | | placing the property in service, and the designated |
| 8 | | location in Illinois
for the investment.
|
| 9 | | (11) A requirement that the Taxpayer shall provide |
| 10 | | written
notification to the Director and
the Committee not |
| 11 | | more than 30 days after the Taxpayer determines
that the |
| 12 | | minimum
job creation or retention, employment payroll, or |
| 13 | | investment no longer is being
or will be achieved or
|
| 14 | | maintained as set forth in the terms and conditions of the
|
| 15 | | Agreement.
|
| 16 | | (12) A provision that, if the total number of New |
| 17 | | Employees falls
below a specified level, the
allowance of |
| 18 | | Credit shall be suspended until the number of New
Employees |
| 19 | | equals or exceeds
the Agreement amount.
|
| 20 | | (13) A detailed description of the items for which the |
| 21 | | costs incurred by
the Taxpayer will be included
in the |
| 22 | | limitation on the Credit provided in Section 5-30.
|
| 23 | | (13.5) A provision that, if the Taxpayer never meets |
| 24 | | either the investment or job creation and retention |
| 25 | | requirements specified in the Agreement during the entire |
| 26 | | 5-year period beginning on the first day of the first |
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| 1 | | taxable year in which the Agreement is executed and ending |
| 2 | | on the last day of the fifth taxable year after the |
| 3 | | Agreement is executed, then the Agreement is automatically |
| 4 | | terminated on the last day of the fifth taxable year after |
| 5 | | the Agreement is executed and the Taxpayer is not entitled |
| 6 | | to the award of any credits for any of that 5-year period.
|
| 7 | | (14) Any other performance conditions or contract |
| 8 | | provisions as the
Department determines are
appropriate.
|
| 9 | | The Department shall post on its website (i) the terms of |
| 10 | | each Agreement entered into under this Act on or after the |
| 11 | | effective date of this amendatory Act of the 97th General |
| 12 | | Assembly and (ii) the tax information provided to the |
| 13 | | Department under subparagraphs (D) and (E) of paragraph (5) of |
| 14 | | subsection (f). |
| 15 | | (Source: P.A. 97-2, eff. 5-6-11; 97-749, eff. 7-6-12.)
|
| 16 | | Section 10. The Illinois Income Tax Act is amended by |
| 17 | | changing Section 917 as follows:
|
| 18 | | (35 ILCS 5/917) (from Ch. 120, par. 9-917)
|
| 19 | | Sec. 917. Confidentiality and information sharing.
|
| 20 | | (a) Confidentiality.
Except as provided in this Section, |
| 21 | | all information received by the Department
from returns filed |
| 22 | | under this Act, or from any investigation conducted under
the |
| 23 | | provisions of this Act, shall be confidential, except for |
| 24 | | official purposes
within the Department or pursuant to official |
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| 1 | | procedures for collection
of any State tax or pursuant to an |
| 2 | | investigation or audit by the Illinois
State Scholarship |
| 3 | | Commission of a delinquent student loan or monetary award
or |
| 4 | | enforcement of any civil or criminal penalty or sanction
|
| 5 | | imposed by this Act or by another statute imposing a State tax, |
| 6 | | and any
person who divulges any such information in any manner, |
| 7 | | except for such
purposes and pursuant to order of the Director |
| 8 | | or in accordance with a proper
judicial order, shall be guilty |
| 9 | | of a Class A misdemeanor. However, the
provisions of this |
| 10 | | paragraph are not applicable to information furnished
to (i) |
| 11 | | the Department of Healthcare and Family Services (formerly
|
| 12 | | Department of Public Aid), State's Attorneys, and the Attorney |
| 13 | | General for child support enforcement purposes and (ii) a |
| 14 | | licensed attorney representing the taxpayer where an appeal or |
| 15 | | a protest
has been filed on behalf of the taxpayer. If it is |
| 16 | | necessary to file information obtained pursuant to this Act in |
| 17 | | a child support enforcement proceeding, the information shall |
| 18 | | be filed under seal.
|
| 19 | | (b) Public information. Nothing contained in this Act shall |
| 20 | | prevent
the Director from publishing or making available to the |
| 21 | | public the names
and addresses of persons filing returns under |
| 22 | | this Act, or from publishing
or making available reasonable |
| 23 | | statistics concerning the operation of the
tax wherein the |
| 24 | | contents of returns are grouped into aggregates in such a
way |
| 25 | | that the information contained in any individual return shall |
| 26 | | not be
disclosed.
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| 1 | | (c) Governmental agencies. The Director may make available |
| 2 | | to the
Secretary of the Treasury of the United States or his |
| 3 | | delegate, or the
proper officer or his delegate of any other |
| 4 | | state imposing a tax upon or
measured by income, for |
| 5 | | exclusively official purposes, information received
by the |
| 6 | | Department in the administration of this Act, but such |
| 7 | | permission
shall be granted only if the United States or such |
| 8 | | other state, as the case
may be, grants the Department |
| 9 | | substantially similar privileges. The Director
may exchange |
| 10 | | information with the Department of Healthcare and Family |
| 11 | | Services and the
Department of Human Services (acting as |
| 12 | | successor to the Department of Public
Aid under the Department |
| 13 | | of Human Services Act) for
the purpose of verifying sources and |
| 14 | | amounts of income and for other purposes
directly connected |
| 15 | | with the administration of this Act, the Illinois Public Aid |
| 16 | | Code, and any other health benefit program administered by the |
| 17 | | State. The Director may exchange information with the Director |
| 18 | | of
the Department of Employment Security for the purpose of |
| 19 | | verifying sources
and amounts of income and for other purposes |
| 20 | | directly connected with the
administration of this Act and Acts |
| 21 | | administered by the Department of
Employment
Security.
The |
| 22 | | Director may make available to the Illinois Workers' |
| 23 | | Compensation Commission
information regarding employers for |
| 24 | | the purpose of verifying the insurance
coverage required under |
| 25 | | the Workers' Compensation Act and Workers'
Occupational |
| 26 | | Diseases Act. The Director may exchange information with the |
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| 1 | | Illinois Department on Aging for the purpose of verifying |
| 2 | | sources and amounts of income for purposes directly related to |
| 3 | | confirming eligibility for participation in the programs of |
| 4 | | benefits authorized by the Senior Citizens and Disabled Persons |
| 5 | | Property Tax Relief and Pharmaceutical Assistance Act.
|
| 6 | | The Director may make available to any State agency, |
| 7 | | including the
Illinois Supreme Court, which licenses persons to |
| 8 | | engage in any occupation,
information that a person licensed by |
| 9 | | such agency has failed to file
returns under this Act or pay |
| 10 | | the tax, penalty and interest shown therein,
or has failed to |
| 11 | | pay any final assessment of tax, penalty or interest due
under |
| 12 | | this Act.
The Director may make available to any State agency, |
| 13 | | including the Illinois
Supreme
Court, information regarding |
| 14 | | whether a bidder, contractor, or an affiliate of a
bidder or
|
| 15 | | contractor has failed to file returns under this Act or pay the |
| 16 | | tax, penalty,
and interest
shown therein, or has failed to pay |
| 17 | | any final assessment of tax, penalty, or
interest due
under |
| 18 | | this Act, for the limited purpose of enforcing bidder and |
| 19 | | contractor
certifications.
For purposes of this Section, the |
| 20 | | term "affiliate" means any entity that (1)
directly,
|
| 21 | | indirectly, or constructively controls another entity, (2) is |
| 22 | | directly,
indirectly, or
constructively controlled by another |
| 23 | | entity, or (3) is subject to the control
of
a common
entity. |
| 24 | | For purposes of this subsection (a), an entity controls another |
| 25 | | entity
if
it owns,
directly or individually, more than 10% of |
| 26 | | the voting securities of that
entity.
As used in
this |
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| 1 | | subsection (a), the term "voting security" means a security |
| 2 | | that (1)
confers upon the
holder the right to vote for the |
| 3 | | election of members of the board of directors
or similar
|
| 4 | | governing body of the business or (2) is convertible into, or |
| 5 | | entitles the
holder to receive
upon its exercise, a security |
| 6 | | that confers such a right to vote. A general
partnership
|
| 7 | | interest is a voting security.
|
| 8 | | The Director may make available to any State agency, |
| 9 | | including the
Illinois
Supreme Court, units of local |
| 10 | | government, and school districts, information
regarding
|
| 11 | | whether a bidder or contractor is an affiliate of a person who |
| 12 | | is not
collecting
and
remitting Illinois Use taxes, for the |
| 13 | | limited purpose of enforcing bidder and
contractor
|
| 14 | | certifications.
|
| 15 | | The Director may also make available to the Secretary of |
| 16 | | State
information that a corporation which has been issued a |
| 17 | | certificate of
incorporation by the Secretary of State has |
| 18 | | failed to file returns under
this Act or pay the tax, penalty |
| 19 | | and interest shown therein, or has failed
to pay any final |
| 20 | | assessment of tax, penalty or interest due under this Act.
An |
| 21 | | assessment is final when all proceedings in court for
review of |
| 22 | | such assessment have terminated or the time for the taking
|
| 23 | | thereof has expired without such proceedings being instituted. |
| 24 | | For
taxable years ending on or after December 31, 1987, the |
| 25 | | Director may make
available to the Director or principal |
| 26 | | officer of any Department of the
State of Illinois, information |
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| 1 | | that a person employed by such Department
has failed to file |
| 2 | | returns under this Act or pay the tax, penalty and
interest |
| 3 | | shown therein. For purposes of this paragraph, the word
|
| 4 | | "Department" shall have the same meaning as provided in Section |
| 5 | | 3 of the
State Employees Group Insurance Act of 1971.
|
| 6 | | The Director may provide information to the Department of |
| 7 | | Commerce and Economic Opportunity for the purpose of confirming |
| 8 | | information provided by a taxpayer under subparagraphs (D) and |
| 9 | | (E) of item (5) of subsection (f) of Section 5-15 of the |
| 10 | | Economic Development for a Growing Economy Tax Credit Act if |
| 11 | | the taxpayer consents to that disclosure in the Agreement under |
| 12 | | that Act. |
| 13 | | (d) The Director shall make available for public
inspection |
| 14 | | in the Department's principal office and for publication, at |
| 15 | | cost,
administrative decisions issued on or after January
1, |
| 16 | | 1995. These decisions are to be made available in a manner so |
| 17 | | that the
following
taxpayer information is not disclosed:
|
| 18 | | (1) The names, addresses, and identification numbers |
| 19 | | of the taxpayer,
related entities, and employees.
|
| 20 | | (2) At the sole discretion of the Director, trade |
| 21 | | secrets
or other confidential information identified as |
| 22 | | such by the taxpayer, no later
than 30 days after receipt |
| 23 | | of an administrative decision, by such means as the
|
| 24 | | Department shall provide by rule.
|
| 25 | | The Director shall determine the
appropriate extent of the
|
| 26 | | deletions allowed in paragraph (2). In the event the taxpayer |
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| 1 | | does not submit
deletions,
the Director shall make only the |
| 2 | | deletions specified in paragraph (1).
|
| 3 | | The Director shall make available for public inspection and |
| 4 | | publication an
administrative decision within 180 days after |
| 5 | | the issuance of the
administrative
decision. The term |
| 6 | | "administrative decision" has the same meaning as defined in
|
| 7 | | Section 3-101 of Article III of the Code of Civil Procedure. |
| 8 | | Costs collected
under this Section shall be paid into the Tax |
| 9 | | Compliance and Administration
Fund.
|
| 10 | | (e) Nothing contained in this Act shall prevent the |
| 11 | | Director from
divulging
information to any person pursuant to a |
| 12 | | request or authorization made by the
taxpayer, by an authorized |
| 13 | | representative of the taxpayer, or, in the case of
information |
| 14 | | related to a joint return, by the spouse filing the joint |
| 15 | | return
with the taxpayer.
|
| 16 | | (Source: P.A. 95-331, eff. 8-21-07; 96-1501, eff. 1-25-11.)
|
| 17 | | Section 15. The Use Tax Act is amended by changing Section |
| 18 | | 3-85 as follows:
|
| 19 | | (35 ILCS 105/3-85)
|
| 20 | | Sec. 3-85. Manufacturer's Purchase Credit. For purchases |
| 21 | | of machinery and
equipment made on and after January 1, 1995 |
| 22 | | through June 30, 2003, and on and after September 1, 2004 |
| 23 | | through February 28, 2015 August 30, 2014,
a
purchaser of |
| 24 | | manufacturing
machinery and equipment that qualifies for the |
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| 1 | | exemption provided by
paragraph (18) of Section 3-5 of this Act |
| 2 | | earns a credit in an amount equal to
a fixed percentage of the |
| 3 | | tax which would have been incurred under this Act on
those |
| 4 | | purchases.
For purchases of graphic arts machinery and |
| 5 | | equipment made on or after July
1, 1996 and through June 30, |
| 6 | | 2003, and on and after September 1, 2004 through February 28, |
| 7 | | 2015 August 30, 2014, a purchaser of graphic arts machinery
and |
| 8 | | equipment that qualifies for
the exemption provided by |
| 9 | | paragraph (6) of Section 3-5 of this Act earns a
credit in an |
| 10 | | amount equal to a fixed percentage of the tax that would have |
| 11 | | been
incurred under this Act on those purchases.
The credit |
| 12 | | earned for purchases of manufacturing machinery and equipment |
| 13 | | or
graphic arts machinery and equipment shall be referred to as |
| 14 | | the
Manufacturer's Purchase
Credit.
A graphic arts producer is |
| 15 | | a person engaged in graphic arts production as
defined in |
| 16 | | Section 2-30 of the Retailers' Occupation Tax Act. Beginning |
| 17 | | July
1, 1996, all references in this Section to manufacturers |
| 18 | | or manufacturing shall
also be deemed to refer to graphic arts |
| 19 | | producers or graphic arts production.
|
| 20 | | The amount of credit shall be a percentage of the tax that |
| 21 | | would have
been incurred on the purchase of manufacturing |
| 22 | | machinery and equipment
or graphic arts machinery and equipment
|
| 23 | | if the exemptions provided by paragraph (6) or paragraph
(18) |
| 24 | | of Section 3-5
of this Act had not been applicable. The |
| 25 | | percentage shall be as follows:
|
| 26 | | (1) 15% for purchases made on or before June 30, 1995.
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| 1 | | (2) 25% for purchases made after June 30, 1995, and on |
| 2 | | or before June 30,
1996.
|
| 3 | | (3) 40% for purchases made after June 30, 1996, and on |
| 4 | | or before June 30,
1997.
|
| 5 | | (4) 50% for purchases made on or after July 1, 1997.
|
| 6 | | (a) Manufacturer's Purchase Credit earned prior to July 1, |
| 7 | | 2003. This subsection (a) applies to Manufacturer's Purchase |
| 8 | | Credit earned prior to July 1, 2003. A purchaser of production |
| 9 | | related tangible personal property desiring to use
the |
| 10 | | Manufacturer's Purchase Credit shall certify to the seller |
| 11 | | prior to
October 1, 2003 that the
purchaser is satisfying all |
| 12 | | or part of the liability under the Use Tax Act or
the Service |
| 13 | | Use Tax Act that is due on the
purchase of the production |
| 14 | | related tangible personal property by use of
Manufacturer's |
| 15 | | Purchase Credit. The Manufacturer's Purchase Credit
|
| 16 | | certification must be dated and shall include the name and |
| 17 | | address of the
purchaser, the purchaser's registration number, |
| 18 | | if registered, the credit being
applied, and a statement that |
| 19 | | the State Use Tax or Service Use Tax liability is
being |
| 20 | | satisfied with the manufacturer's or graphic arts producer's
|
| 21 | | accumulated purchase credit.
Certification may be incorporated |
| 22 | | into the manufacturer's or graphic arts
producer's purchase |
| 23 | | order.
Manufacturer's Purchase Credit certification provided |
| 24 | | by the manufacturer
or graphic
arts producer prior to October |
| 25 | | 1, 2003 may be used to
satisfy the retailer's or serviceman's |
| 26 | | liability under the Retailers'
Occupation Tax Act or Service |
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| 1 | | Occupation Tax Act for the credit claimed, not to
exceed 6.25% |
| 2 | | of the receipts subject to tax from a qualifying purchase, but
|
| 3 | | only if the retailer or serviceman reports the Manufacturer's |
| 4 | | Purchase Credit
claimed as required by the Department. A |
| 5 | | Manufacturer's Purchase Credit
reported on any original or |
| 6 | | amended return
filed under
this Act after October 20, 2003 |
| 7 | | shall be disallowed. The Manufacturer's
Purchase Credit
earned |
| 8 | | by purchase of exempt manufacturing machinery and equipment
or |
| 9 | | graphic arts machinery and equipment is a non-transferable |
| 10 | | credit. A
manufacturer or graphic arts producer that enters |
| 11 | | into a
contract involving the installation of tangible personal |
| 12 | | property
into real estate within a manufacturing or graphic |
| 13 | | arts production facility
may, prior to October 1, 2003, |
| 14 | | authorize a construction contractor
to utilize credit |
| 15 | | accumulated by the manufacturer or graphic arts producer
to
|
| 16 | | purchase the tangible personal property. A manufacturer or |
| 17 | | graphic arts
producer
intending to use accumulated credit to |
| 18 | | purchase such tangible personal
property shall execute a |
| 19 | | written contract authorizing the contractor to utilize
a |
| 20 | | specified dollar amount of credit. The contractor shall |
| 21 | | furnish, prior to
October 1, 2003, the supplier
with the |
| 22 | | manufacturer's or graphic arts producer's name, registration |
| 23 | | or
resale
number, and a statement that a specific amount of the |
| 24 | | Use Tax or Service Use
Tax liability, not to exceed 6.25% of |
| 25 | | the selling price, is being satisfied
with the credit. The |
| 26 | | manufacturer or graphic arts producer shall remain
liable to |
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| 1 | | timely report all
information required by the annual Report of |
| 2 | | Manufacturer's Purchase Credit
Used for all credit utilized by |
| 3 | | a construction contractor.
|
| 4 | | No Manufacturer's Purchase Credit earned prior to July 1, |
| 5 | | 2003 may be used after October 1, 2003. The Manufacturer's |
| 6 | | Purchase Credit may be used to satisfy liability under the
Use |
| 7 | | Tax Act or the Service Use Tax Act due on the purchase of |
| 8 | | production
related tangible personal property (including |
| 9 | | purchases by a manufacturer, by
a graphic arts producer, or by
|
| 10 | | a lessor who rents or leases the use of the property to a |
| 11 | | manufacturer or
graphic arts producer)
that does not otherwise |
| 12 | | qualify
for the manufacturing machinery and equipment
|
| 13 | | exemption or the graphic arts machinery and equipment |
| 14 | | exemption.
"Production related
tangible personal property" |
| 15 | | means (i) all tangible personal property used or
consumed by |
| 16 | | the purchaser in a manufacturing facility in which a |
| 17 | | manufacturing
process described in Section 2-45 of the |
| 18 | | Retailers' Occupation Tax Act takes
place, including tangible |
| 19 | | personal property purchased for incorporation into
real estate |
| 20 | | within a manufacturing facility
and including, but not limited |
| 21 | | to, tangible
personal property used or consumed in activities |
| 22 | | such as preproduction material
handling, receiving, quality |
| 23 | | control, inventory control, storage, staging, and
packaging |
| 24 | | for shipping and transportation purposes; (ii) all tangible
|
| 25 | | personal property used or consumed by the purchaser in a |
| 26 | | graphic arts facility
in which graphic arts production as |
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| 1 | | described in Section 2-30 of the Retailers'
Occupation Tax Act |
| 2 | | takes place, including tangible personal property purchased
|
| 3 | | for incorporation into real estate within a graphic arts |
| 4 | | facility and
including, but not limited to, all tangible |
| 5 | | personal property used or consumed
in activities such as |
| 6 | | graphic arts preliminary or pre-press production,
|
| 7 | | pre-production material handling, receiving, quality control, |
| 8 | | inventory
control, storage, staging, sorting, labeling, |
| 9 | | mailing, tying, wrapping, and
packaging; and (iii) all tangible
|
| 10 | | personal property used or consumed by the purchaser
for |
| 11 | | research and development.
"Production related tangible |
| 12 | | personal property" does not include (i) tangible
personal |
| 13 | | property used, within or without a manufacturing facility, in |
| 14 | | sales,
purchasing, accounting, fiscal management, marketing, |
| 15 | | personnel recruitment or
selection, or landscaping or (ii) |
| 16 | | tangible personal property required to be
titled or registered |
| 17 | | with a department, agency, or unit of federal, state, or
local |
| 18 | | government. The Manufacturer's Purchase Credit may be used, |
| 19 | | prior to
October 1, 2003, to satisfy
the tax arising either |
| 20 | | from the purchase of
machinery and equipment on or after |
| 21 | | January 1,
1995 for which the exemption
provided by paragraph |
| 22 | | (18) of Section 3-5 of this Act was
erroneously claimed, or the |
| 23 | | purchase of machinery and equipment on or after
July 1, 1996 |
| 24 | | for which the exemption provided by paragraph (6) of Section |
| 25 | | 3-5
of this Act was erroneously claimed, but not in
|
| 26 | | satisfaction of penalty, if any, and interest for failure to |
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| 1 | | pay the tax
when due. A
purchaser of production related |
| 2 | | tangible personal property who is required to
pay Illinois Use |
| 3 | | Tax or Service Use Tax on the purchase directly to the
|
| 4 | | Department may, prior to October 1, 2003, utilize the |
| 5 | | Manufacturer's
Purchase Credit in satisfaction of
the tax |
| 6 | | arising from that purchase, but not in
satisfaction of penalty |
| 7 | | and interest.
A purchaser who uses the Manufacturer's Purchase |
| 8 | | Credit to purchase property
which is later determined not to be |
| 9 | | production related tangible personal
property may be liable for |
| 10 | | tax, penalty, and interest on the purchase of that
property as |
| 11 | | of the date of purchase but shall be entitled to use the |
| 12 | | disallowed
Manufacturer's Purchase
Credit, so long as it has |
| 13 | | not expired and is used prior to October 1, 2003,
on qualifying |
| 14 | | purchases of production
related tangible personal property not |
| 15 | | previously subject to credit usage.
The Manufacturer's |
| 16 | | Purchase Credit earned by a manufacturer or graphic arts
|
| 17 | | producer
expires the last day of the second calendar year |
| 18 | | following the
calendar year in which the credit arose. No |
| 19 | | Manufacturer's Purchase Credit
may be used after September 30, |
| 20 | | 2003
regardless of
when that credit was earned.
|
| 21 | | A purchaser earning Manufacturer's Purchase Credit shall |
| 22 | | sign and file an
annual Report of Manufacturer's Purchase |
| 23 | | Credit Earned for each calendar year
no later than the last day |
| 24 | | of the sixth month following the calendar year in
which a |
| 25 | | Manufacturer's Purchase Credit is earned. A Report of |
| 26 | | Manufacturer's
Purchase Credit Earned shall be filed on forms |
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| 1 | | as prescribed or approved by the
Department and shall state, |
| 2 | | for each month of the calendar year: (i) the total
purchase |
| 3 | | price of all purchases of exempt manufacturing or graphic arts
|
| 4 | | machinery on which the
credit was earned; (ii) the total State |
| 5 | | Use Tax or Service Use Tax which would
have been due on those |
| 6 | | items; (iii) the percentage used to calculate the amount
of |
| 7 | | credit earned; (iv) the amount of credit earned; and (v) such |
| 8 | | other
information as the Department may reasonably require. A |
| 9 | | purchaser earning
Manufacturer's Purchase Credit shall |
| 10 | | maintain records which identify, as to
each purchase of |
| 11 | | manufacturing or graphic arts machinery and equipment
on which |
| 12 | | the purchaser
earned Manufacturer's Purchase Credit, the |
| 13 | | vendor (including, if applicable,
either the vendor's |
| 14 | | registration number or Federal Employer Identification
|
| 15 | | Number), the purchase price, and the amount of Manufacturer's |
| 16 | | Purchase Credit
earned on each purchase.
|
| 17 | | A purchaser using Manufacturer's Purchase Credit shall |
| 18 | | sign and file an
annual Report of Manufacturer's Purchase |
| 19 | | Credit Used for each calendar year no
later than the last day |
| 20 | | of the sixth month following the calendar year in which
a |
| 21 | | Manufacturer's Purchase Credit is used. A Report of |
| 22 | | Manufacturer's Purchase
Credit Used
shall be filed on forms as |
| 23 | | prescribed or approved by the Department and
shall state, for |
| 24 | | each month of the calendar year: (i) the total purchase price
|
| 25 | | of production related tangible personal property purchased |
| 26 | | from Illinois
suppliers; (ii) the total purchase price of |
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| 1 | | production related tangible
personal property purchased from |
| 2 | | out-of-state suppliers; (iii) the total amount
of credit used |
| 3 | | during such month; and (iv) such
other information as the |
| 4 | | Department may reasonably require. A purchaser using
|
| 5 | | Manufacturer's Purchase Credit shall maintain records that |
| 6 | | identify, as to
each purchase of production related tangible |
| 7 | | personal property on which the
purchaser used Manufacturer's |
| 8 | | Purchase Credit, the vendor (including, if
applicable, either |
| 9 | | the vendor's registration number or Federal Employer
|
| 10 | | Identification Number), the purchase price, and the amount of |
| 11 | | Manufacturer's
Purchase Credit used on each purchase.
|
| 12 | | No annual report shall be filed before May 1, 1996 or after |
| 13 | | June 30,
2004. A purchaser that fails to
file an annual Report |
| 14 | | of Manufacturer's Purchase Credit Earned or an annual
Report of |
| 15 | | Manufacturer's
Purchase Credit Used by the last day of the |
| 16 | | sixth month following the
end of the calendar year shall |
| 17 | | forfeit all Manufacturer's Purchase Credit for
that calendar |
| 18 | | year unless it establishes that its failure to file was due to
|
| 19 | | reasonable cause. Manufacturer's Purchase Credit reports may |
| 20 | | be amended
to report and claim credit on qualifying purchases |
| 21 | | not previously reported at
any time before the credit would |
| 22 | | have expired, unless both the Department and
the purchaser have |
| 23 | | agreed to an extension of
the statute of limitations for the |
| 24 | | issuance of a notice of tax liability as
provided in Section 4 |
| 25 | | of the Retailers' Occupation Tax Act. If the time for
|
| 26 | | assessment or refund has been extended, then amended reports |
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| | 09800SB0346ham001 | - 37 - | LRB098 04644 HLH 60486 a |
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| 1 | | for a calendar
year may be filed at any time prior to the date |
| 2 | | to which the statute of
limitations for the calendar year or |
| 3 | | portion thereof has been extended.
No Manufacturer's Purchase
|
| 4 | | Credit report filed with the Department for periods prior to |
| 5 | | January 1, 1995
shall be approved.
Manufacturer's Purchase |
| 6 | | Credit claimed on an amended report may be used,
until October |
| 7 | | 1, 2003, to
satisfy tax liability under the Use Tax Act or the |
| 8 | | Service Use Tax Act (i) on
qualifying purchases of production |
| 9 | | related tangible personal property made
after the date the |
| 10 | | amended report is filed or (ii) assessed by the Department
on |
| 11 | | qualifying purchases of production related tangible personal |
| 12 | | property made
in the case of manufacturers
on or after January |
| 13 | | 1, 1995, or in the case of graphic arts producers on or
after |
| 14 | | July 1, 1996.
|
| 15 | | If the purchaser is not the manufacturer or a graphic arts |
| 16 | | producer, but
rents or
leases the use of the property to a |
| 17 | | manufacturer or graphic arts producer,
the purchaser may earn,
|
| 18 | | report, and use Manufacturer's Purchase Credit in the same |
| 19 | | manner as a
manufacturer or graphic arts producer.
|
| 20 | | A purchaser shall not be entitled to any Manufacturer's |
| 21 | | Purchase
Credit for a purchase that is required to be reported |
| 22 | | and is not timely
reported as provided in this Section. A |
| 23 | | purchaser remains liable for (i) any
tax that was satisfied by |
| 24 | | use of a Manufacturer's Purchase Credit, as of the
date of |
| 25 | | purchase, if that use is not timely reported as required in |
| 26 | | this
Section and (ii) for any applicable penalties and interest |
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| 1 | | for failing to pay
the tax when due. No Manufacturer's Purchase |
| 2 | | Credit may be used after
September 30, 2003 to
satisfy any
tax |
| 3 | | liability imposed under this Act, including any audit |
| 4 | | liability.
|
| 5 | | (b) Manufacturer's Purchase Credit earned on and after |
| 6 | | September 1, 2004. This subsection (b) applies to |
| 7 | | Manufacturer's Purchase Credit earned on and after September 1, |
| 8 | | 2004. Manufacturer's Purchase Credit earned on or after |
| 9 | | September 1, 2004 may only be used to satisfy the Use Tax or |
| 10 | | Service Use Tax liability incurred on production related |
| 11 | | tangible personal property purchased on or after September 1, |
| 12 | | 2004. A purchaser of production related tangible personal |
| 13 | | property desiring to use the Manufacturer's Purchase Credit |
| 14 | | shall certify to the seller that the purchaser is satisfying |
| 15 | | all or part of the liability under the Use Tax Act or the |
| 16 | | Service Use Tax Act that is due on the purchase of the |
| 17 | | production related tangible personal property by use of |
| 18 | | Manufacturer's Purchase Credit. The Manufacturer's Purchase |
| 19 | | Credit certification must be dated and shall include the name |
| 20 | | and address of the purchaser, the purchaser's registration |
| 21 | | number, if registered, the credit being applied, and a |
| 22 | | statement that the State Use Tax or Service Use Tax liability |
| 23 | | is being satisfied with the manufacturer's or graphic arts |
| 24 | | producer's accumulated purchase credit. Certification may be |
| 25 | | incorporated into the manufacturer's or graphic arts |
| 26 | | producer's purchase order. Manufacturer's Purchase Credit |
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| 1 | | certification provided by the manufacturer or graphic arts |
| 2 | | producer may be used to satisfy the retailer's or serviceman's |
| 3 | | liability under the Retailers' Occupation Tax Act or Service |
| 4 | | Occupation Tax Act for the credit claimed, not to exceed 6.25% |
| 5 | | of the receipts subject to tax from a qualifying purchase, but |
| 6 | | only if the retailer or serviceman reports the Manufacturer's |
| 7 | | Purchase Credit claimed as required by the Department. The |
| 8 | | Manufacturer's Purchase Credit earned by purchase of exempt |
| 9 | | manufacturing machinery and equipment or graphic arts |
| 10 | | machinery and equipment is a non-transferable credit. A |
| 11 | | manufacturer or graphic arts producer that enters into a |
| 12 | | contract involving the installation of tangible personal |
| 13 | | property into real estate within a manufacturing or graphic |
| 14 | | arts production facility may, on or after September 1, 2004, |
| 15 | | authorize a construction contractor to utilize credit |
| 16 | | accumulated by the manufacturer or graphic arts producer to |
| 17 | | purchase the tangible personal property. A manufacturer or |
| 18 | | graphic arts producer intending to use accumulated credit to |
| 19 | | purchase such tangible personal property shall execute a |
| 20 | | written contract authorizing the contractor to utilize a |
| 21 | | specified dollar amount of credit. The contractor shall furnish |
| 22 | | the supplier with the manufacturer's or graphic arts producer's |
| 23 | | name, registration or resale number, and a statement that a |
| 24 | | specific amount of the Use Tax or Service Use Tax liability, |
| 25 | | not to exceed 6.25% of the selling price, is being satisfied |
| 26 | | with the credit. The manufacturer or graphic arts producer |
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| 1 | | shall remain liable to timely report all information required |
| 2 | | by the annual Report of Manufacturer's Purchase Credit Used for |
| 3 | | all credit utilized by a construction contractor. |
| 4 | | The Manufacturer's Purchase Credit may be used to satisfy |
| 5 | | liability under the Use Tax Act or the Service Use Tax Act due |
| 6 | | on the purchase, made on or after September 1, 2004, of |
| 7 | | production related tangible personal property (including |
| 8 | | purchases by a manufacturer, by a graphic arts producer, or by |
| 9 | | a lessor who rents or leases the use of the property to a |
| 10 | | manufacturer or graphic arts producer) that does not otherwise |
| 11 | | qualify for the manufacturing machinery and equipment |
| 12 | | exemption or the graphic arts machinery and equipment |
| 13 | | exemption. "Production related tangible personal property" |
| 14 | | means (i) all tangible personal property used or consumed by |
| 15 | | the purchaser in a manufacturing facility in which a |
| 16 | | manufacturing process described in Section 2-45 of the |
| 17 | | Retailers' Occupation Tax Act takes place, including tangible |
| 18 | | personal property purchased for incorporation into real estate |
| 19 | | within a manufacturing facility and including, but not limited |
| 20 | | to, tangible personal property used or consumed in activities |
| 21 | | such as preproduction material handling, receiving, quality |
| 22 | | control, inventory control, storage, staging, and packaging |
| 23 | | for shipping and transportation purposes; (ii) all tangible |
| 24 | | personal property used or consumed by the purchaser in a |
| 25 | | graphic arts facility in which graphic arts production as |
| 26 | | described in Section 2-30 of the Retailers' Occupation Tax Act |
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| 1 | | takes place, including tangible personal property purchased |
| 2 | | for incorporation into real estate within a graphic arts |
| 3 | | facility and including, but not limited to, all tangible |
| 4 | | personal property used or consumed in activities such as |
| 5 | | graphic arts preliminary or pre-press production, |
| 6 | | pre-production material handling, receiving, quality control, |
| 7 | | inventory control, storage, staging, sorting, labeling, |
| 8 | | mailing, tying, wrapping, and packaging; and (iii) all tangible |
| 9 | | personal property used or consumed by the purchaser for |
| 10 | | research and development. "Production related tangible |
| 11 | | personal property" does not include (i) tangible personal |
| 12 | | property used, within or without a manufacturing facility, in |
| 13 | | sales, purchasing, accounting, fiscal management, marketing, |
| 14 | | personnel recruitment or selection, or landscaping or (ii) |
| 15 | | tangible personal property required to be titled or registered |
| 16 | | with a department, agency, or unit of federal, state, or local |
| 17 | | government. The Manufacturer's Purchase Credit may be used to |
| 18 | | satisfy the tax arising either from the purchase of machinery |
| 19 | | and equipment on or after September 1, 2004 for which the |
| 20 | | exemption provided by paragraph (18) of Section 3-5 of this Act |
| 21 | | was erroneously claimed, or the purchase of machinery and |
| 22 | | equipment on or after September 1, 2004 for which the exemption |
| 23 | | provided by paragraph (6) of Section 3-5 of this Act was |
| 24 | | erroneously claimed, but not in satisfaction of penalty, if |
| 25 | | any, and interest for failure to pay the tax when due. A |
| 26 | | purchaser of production related tangible personal property |
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| 1 | | that is purchased on or after September 1, 2004 who is required |
| 2 | | to pay Illinois Use Tax or Service Use Tax on the purchase |
| 3 | | directly to the Department may utilize the Manufacturer's |
| 4 | | Purchase Credit in satisfaction of the tax arising from that |
| 5 | | purchase, but not in satisfaction of penalty and interest. A |
| 6 | | purchaser who uses the Manufacturer's Purchase Credit to |
| 7 | | purchase property on and after September 1, 2004 which is later |
| 8 | | determined not to be production related tangible personal |
| 9 | | property may be liable for tax, penalty, and interest on the |
| 10 | | purchase of that property as of the date of purchase but shall |
| 11 | | be entitled to use the disallowed Manufacturer's Purchase |
| 12 | | Credit, so long as it has not expired and is used on qualifying |
| 13 | | purchases of production related tangible personal property not |
| 14 | | previously subject to credit usage. The Manufacturer's |
| 15 | | Purchase Credit earned by a manufacturer or graphic arts |
| 16 | | producer expires the last day of the second calendar year |
| 17 | | following the calendar year in which the credit arose.
A |
| 18 | | purchaser earning Manufacturer's Purchase Credit shall sign |
| 19 | | and file an annual Report of Manufacturer's Purchase Credit |
| 20 | | Earned for each calendar year no later than the last day of the |
| 21 | | sixth month following the calendar year in which a |
| 22 | | Manufacturer's Purchase Credit is earned. A Report of |
| 23 | | Manufacturer's Purchase Credit Earned shall be filed on forms |
| 24 | | as prescribed or approved by the Department and shall state, |
| 25 | | for each month of the calendar year: (i) the total purchase |
| 26 | | price of all purchases of exempt manufacturing or graphic arts |
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| | 09800SB0346ham001 | - 43 - | LRB098 04644 HLH 60486 a |
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| 1 | | machinery on which the credit was earned; (ii) the total State |
| 2 | | Use Tax or Service Use Tax which would have been due on those |
| 3 | | items; (iii) the percentage used to calculate the amount of |
| 4 | | credit earned; (iv) the amount of credit earned; and (v) such |
| 5 | | other information as the Department may reasonably require. A |
| 6 | | purchaser earning Manufacturer's Purchase Credit shall |
| 7 | | maintain records which identify, as to each purchase of |
| 8 | | manufacturing or graphic arts machinery and equipment on which |
| 9 | | the purchaser earned Manufacturer's Purchase Credit, the |
| 10 | | vendor (including, if applicable, either the vendor's |
| 11 | | registration number or Federal Employer Identification |
| 12 | | Number), the purchase price, and the amount of Manufacturer's |
| 13 | | Purchase Credit earned on each purchase.
A purchaser using |
| 14 | | Manufacturer's Purchase Credit shall sign and file an annual |
| 15 | | Report of Manufacturer's Purchase Credit Used for each calendar |
| 16 | | year no later than the last day of the sixth month following |
| 17 | | the calendar year in which a Manufacturer's Purchase Credit is |
| 18 | | used. A Report of Manufacturer's Purchase Credit Used shall be |
| 19 | | filed on forms as prescribed or approved by the Department and |
| 20 | | shall state, for each month of the calendar year: (i) the total |
| 21 | | purchase price of production related tangible personal |
| 22 | | property purchased from Illinois suppliers; (ii) the total |
| 23 | | purchase price of production related tangible personal |
| 24 | | property purchased from out-of-state suppliers; (iii) the |
| 25 | | total amount of credit used during such month; and (iv) such |
| 26 | | other information as the Department may reasonably require. A |
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| 1 | | purchaser using Manufacturer's Purchase Credit shall maintain |
| 2 | | records that identify, as to each purchase of production |
| 3 | | related tangible personal property on which the purchaser used |
| 4 | | Manufacturer's Purchase Credit, the vendor (including, if |
| 5 | | applicable, either the vendor's registration number or Federal |
| 6 | | Employer Identification Number), the purchase price, and the |
| 7 | | amount of Manufacturer's Purchase Credit used on each purchase. |
| 8 | | A purchaser that fails to file an annual Report of |
| 9 | | Manufacturer's Purchase Credit Earned or an annual Report of |
| 10 | | Manufacturer's Purchase Credit Used by the last day of the |
| 11 | | sixth month following the end of the calendar year shall |
| 12 | | forfeit all Manufacturer's Purchase Credit for that calendar |
| 13 | | year unless it establishes that its failure to file was due to |
| 14 | | reasonable cause. Manufacturer's Purchase Credit reports may |
| 15 | | be amended to report and claim credit on qualifying purchases |
| 16 | | not previously reported at any time before the credit would |
| 17 | | have expired, unless both the Department and the purchaser have |
| 18 | | agreed to an extension of the statute of limitations for the |
| 19 | | issuance of a notice of tax liability as provided in Section 4 |
| 20 | | of the Retailers' Occupation Tax Act. If the time for |
| 21 | | assessment or refund has been extended, then amended reports |
| 22 | | for a calendar year may be filed at any time prior to the date |
| 23 | | to which the statute of limitations for the calendar year or |
| 24 | | portion thereof has been extended. Manufacturer's Purchase |
| 25 | | Credit claimed on an amended report may be used to satisfy tax |
| 26 | | liability under the Use Tax Act or the Service Use Tax Act (i) |
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| 1 | | on qualifying purchases of production related tangible |
| 2 | | personal property made after the date the amended report is |
| 3 | | filed or (ii) assessed by the Department on qualifying |
| 4 | | production related tangible personal property purchased on or |
| 5 | | after September 1, 2004. If the purchaser is not the |
| 6 | | manufacturer or a graphic arts producer, but rents or leases |
| 7 | | the use of the property to a manufacturer or graphic arts |
| 8 | | producer, the purchaser may earn, report, and use |
| 9 | | Manufacturer's Purchase Credit in the same manner as a |
| 10 | | manufacturer or graphic arts producer.
A purchaser shall not be |
| 11 | | entitled to any Manufacturer's Purchase Credit for a purchase |
| 12 | | that is required to be reported and is not timely reported as |
| 13 | | provided in this Section. A purchaser remains liable for (i) |
| 14 | | any tax that was satisfied by use of a Manufacturer's Purchase |
| 15 | | Credit, as of the date of purchase, if that use is not timely |
| 16 | | reported as required in this Section and (ii) for any |
| 17 | | applicable penalties and interest for failing to pay the tax |
| 18 | | when due. |
| 19 | | (Source: P.A. 96-116, eff. 7-31-09.)
|
| 20 | | Section 20. The Service Use Tax Act is amended by changing |
| 21 | | Section 3-70 as follows:
|
| 22 | | (35 ILCS 110/3-70)
|
| 23 | | Sec. 3-70. Manufacturer's Purchase Credit. For purchases |
| 24 | | of machinery and
equipment made on and after January 1, 1995 |
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| 1 | | and through June 30, 2003, and on and after September 1, 2004 |
| 2 | | through February 28, 2015 August 30, 2014,
a
purchaser of |
| 3 | | manufacturing
machinery and equipment that qualifies for the |
| 4 | | exemption provided by Section
2 of this Act earns a credit in |
| 5 | | an amount equal to a fixed
percentage of
the tax which would |
| 6 | | have been incurred under this Act on those purchases.
For |
| 7 | | purchases of graphic arts machinery and equipment made on or |
| 8 | | after July
1, 1996 through June 30, 2003, and on and after |
| 9 | | September 1, 2004 through February 28, 2015 August 30, 2014, a |
| 10 | | purchase of graphic arts machinery and
equipment that qualifies |
| 11 | | for
the exemption provided by paragraph (5) of Section 3-5 of |
| 12 | | this Act earns a
credit in an amount equal to a fixed |
| 13 | | percentage of the tax that would have been
incurred under this |
| 14 | | Act on those purchases.
The credit earned for the purchase of |
| 15 | | manufacturing machinery and equipment
and graphic arts |
| 16 | | machinery and equipment shall be referred to
as the |
| 17 | | Manufacturer's Purchase Credit.
A graphic arts producer is a |
| 18 | | person engaged in graphic arts production as
defined in Section |
| 19 | | 3-30 of the Service Occupation Tax Act. Beginning July 1,
1996, |
| 20 | | all references in this Section to manufacturers or |
| 21 | | manufacturing shall
also refer to graphic arts producers or |
| 22 | | graphic arts production.
|
| 23 | | The amount of credit shall be a percentage of the tax that |
| 24 | | would have been
incurred on the purchase of the manufacturing |
| 25 | | machinery and equipment or
graphic arts machinery and equipment
|
| 26 | | if the
exemptions provided by Section 2 or paragraph (5) of
|
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| 1 | | Section 3-5 of
this Act had not
been applicable.
|
| 2 | | All purchases prior to October 1, 2003 and on and after |
| 3 | | September 1, 2004 and through February 28, 2015, of |
| 4 | | manufacturing machinery and
equipment and graphic arts
|
| 5 | | machinery and equipment that qualify for the exemptions |
| 6 | | provided by paragraph
(5) of Section 2
or paragraph (5) of |
| 7 | | Section 3-5 of this Act qualify for the credit without
regard |
| 8 | | to whether the serviceman elected, or could have elected, under
|
| 9 | | paragraph (7) of Section 2 of this Act to exclude the |
| 10 | | transaction from this
Act. If the serviceman's billing to the |
| 11 | | service customer separately states a
selling price for the |
| 12 | | exempt manufacturing machinery or equipment or the exempt
|
| 13 | | graphic arts machinery and equipment, the credit shall be |
| 14 | | calculated, as
otherwise provided herein, based on that selling |
| 15 | | price. If the serviceman's
billing does not separately state a |
| 16 | | selling price for the exempt manufacturing
machinery and |
| 17 | | equipment or the exempt graphic arts machinery and equipment, |
| 18 | | the
credit shall be calculated, as otherwise provided herein, |
| 19 | | based on 50% of the
entire billing. If the serviceman contracts |
| 20 | | to design, develop, and produce
special order manufacturing |
| 21 | | machinery and equipment or special order graphic
arts machinery |
| 22 | | and equipment, and the billing does not separately state a
|
| 23 | | selling price for such special order machinery and
equipment, |
| 24 | | the credit shall be calculated, as otherwise provided herein, |
| 25 | | based
on 50% of the entire billing. The provisions of this |
| 26 | | paragraph are effective
for purchases made on or after January |
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| 1 | | 1, 1995.
|
| 2 | | The percentage shall be as follows:
|
| 3 | | (1) 15% for purchases made on or before June 30, 1995.
|
| 4 | | (2) 25% for purchases made after June 30, 1995, and on |
| 5 | | or before June 30,
1996.
|
| 6 | | (3) 40% for purchases made after June 30, 1996, and on |
| 7 | | or before June 30,
1997.
|
| 8 | | (4) 50% for purchases made on or after July 1, 1997.
|
| 9 | | (a) Manufacturer's Purchase Credit earned prior to July 1, |
| 10 | | 2003. This subsection (a) applies to Manufacturer's Purchase |
| 11 | | Credit earned prior to July 1, 2003. A purchaser of production |
| 12 | | related tangible personal property desiring to use
the |
| 13 | | Manufacturer's Purchase Credit shall certify to the seller |
| 14 | | prior to
October 1, 2003 that the
purchaser is satisfying all |
| 15 | | or part of
the
liability under the Use Tax Act or the Service |
| 16 | | Use Tax Act that is due on the
purchase of the production |
| 17 | | related tangible personal property by use of a
Manufacturer's |
| 18 | | Purchase Credit. The Manufacturer's Purchase Credit
|
| 19 | | certification
must be dated and shall include the name and |
| 20 | | address of the purchaser, the
purchaser's registration number, |
| 21 | | if registered, the
credit being
applied, and a statement that |
| 22 | | the State Use Tax or Service Use Tax liability
is being |
| 23 | | satisfied with the manufacturer's or graphic arts producer's
|
| 24 | | accumulated purchase credit.
Certification may be incorporated |
| 25 | | into the manufacturer's or graphic arts
producer's
purchase |
| 26 | | order.
Manufacturer's Purchase Credit certification provided |
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| | 09800SB0346ham001 | - 49 - | LRB098 04644 HLH 60486 a |
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| 1 | | by the manufacturer
or graphic
arts producer
prior to October |
| 2 | | 1, 2003 may be used to satisfy the retailer's or
serviceman's |
| 3 | | liability under the
Retailers' Occupation Tax Act or
Service
|
| 4 | | Occupation Tax Act for the credit claimed, not to exceed
6.25% |
| 5 | | of the receipts subject to tax from a qualifying purchase, but |
| 6 | | only if
the retailer or serviceman reports the Manufacturer's |
| 7 | | Purchase Credit claimed
as required by the Department. A |
| 8 | | Manufacturer's Purchase Credit reported on
any original or |
| 9 | | amended return
filed under
this Act after October 20, 2003 |
| 10 | | shall be disallowed. The Manufacturer's
Purchase Credit earned |
| 11 | | by
purchase of exempt manufacturing machinery and equipment
or |
| 12 | | graphic arts machinery and equipment is a
non-transferable |
| 13 | | credit. A manufacturer or graphic arts producer
that enters |
| 14 | | into a
contract involving the installation of tangible personal |
| 15 | | property into
real estate within a manufacturing or graphic |
| 16 | | arts production facility, prior
to October 1, 2003, may |
| 17 | | authorize a construction contractor
to utilize credit |
| 18 | | accumulated by the manufacturer or graphic arts producer
to
|
| 19 | | purchase the tangible personal property. A manufacturer or |
| 20 | | graphic arts
producer
intending to use accumulated credit to |
| 21 | | purchase such tangible personal
property shall execute a |
| 22 | | written contract authorizing the contractor to utilize
a |
| 23 | | specified dollar amount of credit. The contractor shall |
| 24 | | furnish, prior to
October 1, 2003, the supplier
with the |
| 25 | | manufacturer's or graphic arts producer's name, registration |
| 26 | | or
resale number, and a statement
that a specific amount of the |
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| 1 | | Use Tax or Service Use Tax liability, not to
exceed 6.25% of |
| 2 | | the selling price, is being satisfied with the credit. The
|
| 3 | | manufacturer or graphic arts producer shall remain liable to |
| 4 | | timely report
all information required by
the annual Report of |
| 5 | | Manufacturer's Purchase Credit Used for credit utilized by
a
|
| 6 | | construction contractor.
|
| 7 | | No Manufacturer's Purchase Credit earned prior to July 1, |
| 8 | | 2003 may be used after October 1, 2003. The Manufacturer's |
| 9 | | Purchase Credit may be used to satisfy liability under the
Use |
| 10 | | Tax Act or the Service Use Tax Act due on the purchase of |
| 11 | | production
related tangible personal property (including |
| 12 | | purchases by a manufacturer, by
a graphic arts producer,
or a |
| 13 | | lessor who rents or leases the use of
the property to a |
| 14 | | manufacturer or graphic arts producer) that does not
otherwise |
| 15 | | qualify for the manufacturing machinery and equipment
|
| 16 | | exemption or the graphic arts machinery and equipment |
| 17 | | exemption.
"Production related tangible personal
property" |
| 18 | | means (i) all tangible personal property used or consumed by |
| 19 | | the
purchaser in a manufacturing facility in which a |
| 20 | | manufacturing process
described in Section 2-45 of the |
| 21 | | Retailers' Occupation Tax Act
takes place, including tangible |
| 22 | | personal property purchased for incorporation
into
real estate |
| 23 | | within a manufacturing facility and including, but not limited
|
| 24 | | to,
tangible personal property used or consumed in activities |
| 25 | | such as
pre-production
material handling, receiving, quality |
| 26 | | control, inventory control, storage,
staging, and packaging |
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| | 09800SB0346ham001 | - 51 - | LRB098 04644 HLH 60486 a |
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| 1 | | for shipping and transportation purposes; (ii)
all tangible |
| 2 | | personal property used or consumed by the purchaser in a |
| 3 | | graphic
arts facility in which graphic arts production as |
| 4 | | described in Section 2-30 of
the Retailers' Occupation Tax Act |
| 5 | | takes place, including tangible personal
property purchased |
| 6 | | for incorporation into real estate within a graphic arts
|
| 7 | | facility and including, but not limited to, all tangible |
| 8 | | personal property used
or consumed in activities such as |
| 9 | | graphic arts preliminary or pre-press
production, |
| 10 | | pre-production material handling, receiving, quality control,
|
| 11 | | inventory control, storage, staging, sorting, labeling, |
| 12 | | mailing, tying,
wrapping, and packaging; and (iii) all tangible |
| 13 | | personal property used or
consumed by the purchaser
for |
| 14 | | research and
development. "Production related tangible |
| 15 | | personal property" does not include
(i) tangible personal |
| 16 | | property used, within or without a manufacturing or
graphic |
| 17 | | arts
facility, in sales, purchasing,
accounting, fiscal |
| 18 | | management, marketing,
personnel recruitment or selection, or |
| 19 | | landscaping or (ii) tangible personal
property required to be |
| 20 | | titled or registered with a department, agency, or unit
of |
| 21 | | federal, state, or local
government. The Manufacturer's |
| 22 | | Purchase Credit may be used, prior to October
1, 2003, to |
| 23 | | satisfy the tax
arising either from the purchase of
machinery |
| 24 | | and equipment on or after January 1, 1995
for which the |
| 25 | | manufacturing machinery and equipment exemption
provided by |
| 26 | | Section 2 of this Act was
erroneously claimed, or the purchase |
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| 1 | | of machinery and equipment on or after
July 1, 1996 for which |
| 2 | | the exemption provided by paragraph (5) of Section 3-5
of this |
| 3 | | Act was erroneously claimed, but not in
satisfaction of |
| 4 | | penalty, if any, and interest for failure to pay the tax
when |
| 5 | | due. A
purchaser of production related tangible personal |
| 6 | | property who is required to
pay Illinois Use Tax or Service Use |
| 7 | | Tax on the purchase directly to the
Department may, prior to |
| 8 | | October 1, 2003, utilize the Manufacturer's
Purchase Credit in |
| 9 | | satisfaction of
the tax arising from that purchase, but not in
|
| 10 | | satisfaction of penalty and
interest.
A purchaser who uses the |
| 11 | | Manufacturer's Purchase Credit to purchase
property
which is |
| 12 | | later determined not to be production related tangible personal
|
| 13 | | property may be liable for tax, penalty, and interest on the |
| 14 | | purchase of that
property as of the date of purchase but shall |
| 15 | | be entitled to use the disallowed
Manufacturer's Purchase
|
| 16 | | Credit, so long as it has not expired and is used prior to |
| 17 | | October 1, 2003,
on qualifying purchases of production
related |
| 18 | | tangible personal property not previously subject to credit |
| 19 | | usage.
The Manufacturer's Purchase Credit earned by a |
| 20 | | manufacturer or graphic arts
producer
expires the last day of |
| 21 | | the second calendar year following the
calendar year in
which |
| 22 | | the credit arose. No Manufacturer's Purchase Credit may be used |
| 23 | | after
September 30, 2003
regardless of
when that credit was |
| 24 | | earned.
|
| 25 | | A purchaser earning Manufacturer's Purchase Credit shall |
| 26 | | sign and file an
annual Report of Manufacturer's Purchase |
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| | 09800SB0346ham001 | - 53 - | LRB098 04644 HLH 60486 a |
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| 1 | | Credit Earned for each calendar year
no later
than the last day |
| 2 | | of the sixth month following the calendar year in which a
|
| 3 | | Manufacturer's Purchase Credit is earned. A Report of |
| 4 | | Manufacturer's Purchase
Credit
Earned shall be filed on forms |
| 5 | | as prescribed or approved by the Department and
shall state, |
| 6 | | for each month of the calendar year: (i) the total purchase |
| 7 | | price
of all purchases of exempt manufacturing or graphic arts |
| 8 | | machinery on which
the credit was
earned; (ii) the total State |
| 9 | | Use Tax or Service Use Tax which would have been
due on those |
| 10 | | items; (iii) the percentage used to calculate the amount of |
| 11 | | credit
earned; (iv) the amount of credit earned; and (v) such |
| 12 | | other information as the
Department may reasonably require. A |
| 13 | | purchaser earning Manufacturer's Purchase
Credit shall |
| 14 | | maintain records which identify, as to each purchase of
|
| 15 | | manufacturing or graphic arts machinery and equipment on which |
| 16 | | the
purchaser earned
Manufacturer's Purchase Credit, the |
| 17 | | vendor (including, if applicable, either
the vendor's |
| 18 | | registration number or Federal Employer Identification |
| 19 | | Number),
the purchase price, and the amount of Manufacturer's |
| 20 | | Purchase Credit earned on
each purchase.
|
| 21 | | A purchaser using Manufacturer's Purchase Credit shall |
| 22 | | sign and file an
annual Report of Manufacturer's Purchase |
| 23 | | Credit Used for each calendar year no
later than the last day |
| 24 | | of the sixth month following the calendar year in which
a |
| 25 | | Manufacturer's Purchase Credit is used. A Report of |
| 26 | | Manufacturer's Purchase
Credit Used shall be filed on forms as |
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| | 09800SB0346ham001 | - 54 - | LRB098 04644 HLH 60486 a |
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|
| 1 | | prescribed or approved by the Department
and
shall state, for |
| 2 | | each month of the calendar year: (i) the total purchase price
|
| 3 | | of production related tangible personal property purchased |
| 4 | | from Illinois
suppliers; (ii) the total purchase price
of |
| 5 | | production related tangible personal property purchased from |
| 6 | | out-of-state
suppliers; (iii) the total amount of credit used |
| 7 | | during such month; and (iv)
such
other information as the |
| 8 | | Department may reasonably require. A purchaser using
|
| 9 | | Manufacturer's Purchase Credit shall maintain records that |
| 10 | | identify, as to
each purchase of production related tangible |
| 11 | | personal property on which the
purchaser used Manufacturer's |
| 12 | | Purchase Credit, the vendor (including, if
applicable, either |
| 13 | | the vendor's registration number or Federal Employer
|
| 14 | | Identification Number), the purchase price, and the amount of |
| 15 | | Manufacturer's
Purchase Credit used on each purchase.
|
| 16 | | No annual report shall be filed before May 1, 1996 or after |
| 17 | | June 30,
2004.
A purchaser that fails to file an annual Report |
| 18 | | of Manufacturer's Purchase
Credit
Earned or an annual Report of |
| 19 | | Manufacturer's Purchase Credit Used by the last
day
of the |
| 20 | | sixth month following the end of the calendar year shall |
| 21 | | forfeit all
Manufacturer's Purchase Credit for that calendar |
| 22 | | year unless it establishes
that its failure to file was due to |
| 23 | | reasonable cause.
Manufacturer's Purchase Credit
reports may |
| 24 | | be amended to report and claim credit on qualifying purchases |
| 25 | | not
previously reported at any time before the credit would |
| 26 | | have expired, unless
both the Department and the purchaser have |
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|
| 1 | | agreed to an extension of
the statute of limitations for the |
| 2 | | issuance of a notice of tax liability as
provided in Section 4 |
| 3 | | of the Retailers' Occupation Tax Act. If the time for
|
| 4 | | assessment or refund has been extended, then amended reports |
| 5 | | for a calendar
year may be filed at any time prior to the date |
| 6 | | to which the statute of
limitations for the calendar year or |
| 7 | | portion thereof has been extended.
No Manufacturer's Purchase |
| 8 | | Credit report filed with the Department
for periods
prior to |
| 9 | | January 1, 1995 shall be approved.
Manufacturer's Purchase |
| 10 | | Credit claimed on an amended report may be used,
prior to |
| 11 | | October 1, 2003, to
satisfy tax liability under the Use Tax Act |
| 12 | | or the Service Use Tax Act (i) on
qualifying purchases of |
| 13 | | production related tangible personal property made
after the |
| 14 | | date the amended report is filed or (ii) assessed by the |
| 15 | | Department
on qualifying purchases of production related |
| 16 | | tangible personal property made
in the case of manufacturers on |
| 17 | | or after January 1, 1995, or in the case
of graphic arts |
| 18 | | producers on or after July 1, 1996.
|
| 19 | | If the purchaser is not the manufacturer or a graphic arts |
| 20 | | producer, but
rents or
leases the use of the property to a |
| 21 | | manufacturer or a graphic arts
producer,
the purchaser may |
| 22 | | earn, report, and use
Manufacturer's
Purchase Credit in the |
| 23 | | same manner as a manufacturer or graphic arts
producer.
|
| 24 | | A purchaser shall not be entitled to any Manufacturer's |
| 25 | | Purchase
Credit for a purchase that is required to be reported |
| 26 | | and is not timely
reported as
provided in this Section. A |
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| | 09800SB0346ham001 | - 56 - | LRB098 04644 HLH 60486 a |
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| 1 | | purchaser remains liable for (i) any
tax that was satisfied by |
| 2 | | use of a Manufacturer's Purchase Credit, as of the
date of |
| 3 | | purchase, if that use is not timely reported as required in |
| 4 | | this
Section and (ii) for any applicable penalties and interest |
| 5 | | for failing to pay
the tax when due. No Manufacturer's Purchase |
| 6 | | Credit may be used after
September 30, 2003 to
satisfy any
tax |
| 7 | | liability imposed under this Act, including any audit |
| 8 | | liability.
|
| 9 | | (b) Manufacturer's Purchase Credit earned on and after |
| 10 | | September 1, 2004. This subsection (b) applies to |
| 11 | | Manufacturer's Purchase Credit earned on or after September 1, |
| 12 | | 2004. Manufacturer's Purchase Credit earned on or after |
| 13 | | September 1, 2004 may only be used to satisfy the Use Tax or |
| 14 | | Service Use Tax liability incurred on production related |
| 15 | | tangible personal property purchased on or after September 1, |
| 16 | | 2004. A purchaser of production related tangible personal |
| 17 | | property desiring to use the Manufacturer's Purchase Credit |
| 18 | | shall certify to the seller that the purchaser is satisfying |
| 19 | | all or part of the liability under the Use Tax Act or the |
| 20 | | Service Use Tax Act that is due on the purchase of the |
| 21 | | production related tangible personal property by use of a |
| 22 | | Manufacturer's Purchase Credit. The Manufacturer's Purchase |
| 23 | | Credit certification must be dated and shall include the name |
| 24 | | and address of the purchaser, the purchaser's registration |
| 25 | | number, if registered, the credit being applied, and a |
| 26 | | statement that the State Use Tax or Service Use Tax liability |
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| 1 | | is being satisfied with the manufacturer's or graphic arts |
| 2 | | producer's accumulated purchase credit. Certification may be |
| 3 | | incorporated into the manufacturer's or graphic arts |
| 4 | | producer's purchase order. Manufacturer's Purchase Credit |
| 5 | | certification provided by the manufacturer or graphic arts |
| 6 | | producer may be used to satisfy the retailer's or serviceman's |
| 7 | | liability under the Retailers' Occupation Tax Act or Service |
| 8 | | Occupation Tax Act for the credit claimed, not to exceed 6.25% |
| 9 | | of the receipts subject to tax from a qualifying purchase, but |
| 10 | | only if the retailer or serviceman reports the Manufacturer's |
| 11 | | Purchase Credit claimed as required by the Department. The |
| 12 | | Manufacturer's Purchase Credit earned by purchase of exempt |
| 13 | | manufacturing machinery and equipment or graphic arts |
| 14 | | machinery and equipment is a non-transferable credit. A |
| 15 | | manufacturer or graphic arts producer that enters into a |
| 16 | | contract involving the installation of tangible personal |
| 17 | | property into real estate within a manufacturing or graphic |
| 18 | | arts production facility may, on or after September 1, 2004, |
| 19 | | authorize a construction contractor to utilize credit |
| 20 | | accumulated by the manufacturer or graphic arts producer to |
| 21 | | purchase the tangible personal property. A manufacturer or |
| 22 | | graphic arts producer intending to use accumulated credit to |
| 23 | | purchase such tangible personal property shall execute a |
| 24 | | written contract authorizing the contractor to utilize a |
| 25 | | specified dollar amount of credit. The contractor shall furnish |
| 26 | | the supplier with the manufacturer's or graphic arts producer's |
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| | 09800SB0346ham001 | - 58 - | LRB098 04644 HLH 60486 a |
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| 1 | | name, registration or resale number, and a statement that a |
| 2 | | specific amount of the Use Tax or Service Use Tax liability, |
| 3 | | not to exceed 6.25% of the selling price, is being satisfied |
| 4 | | with the credit. The manufacturer or graphic arts producer |
| 5 | | shall remain liable to timely report all information required |
| 6 | | by the annual Report of Manufacturer's Purchase Credit Used for |
| 7 | | credit utilized by a construction contractor. |
| 8 | | The Manufacturer's Purchase Credit may be used to satisfy |
| 9 | | liability under the Use Tax Act or the Service Use Tax Act due |
| 10 | | on the purchase, made on or after September 1, 2004, of |
| 11 | | production related tangible personal property (including |
| 12 | | purchases by a manufacturer, by a graphic arts producer, or a |
| 13 | | lessor who rents or leases the use of the property to a |
| 14 | | manufacturer or graphic arts producer) that does not otherwise |
| 15 | | qualify for the manufacturing machinery and equipment |
| 16 | | exemption or the graphic arts machinery and equipment |
| 17 | | exemption. "Production related tangible personal property" |
| 18 | | means (i) all tangible personal property used or consumed by |
| 19 | | the purchaser in a manufacturing facility in which a |
| 20 | | manufacturing process described in Section 2-45 of the |
| 21 | | Retailers' Occupation Tax Act takes place, including tangible |
| 22 | | personal property purchased for incorporation into real estate |
| 23 | | within a manufacturing facility and including, but not limited |
| 24 | | to, tangible personal property used or consumed in activities |
| 25 | | such as pre-production material handling, receiving, quality |
| 26 | | control, inventory control, storage, staging, and packaging |
|
| | 09800SB0346ham001 | - 59 - | LRB098 04644 HLH 60486 a |
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|
| 1 | | for shipping and transportation purposes; (ii) all tangible |
| 2 | | personal property used or consumed by the purchaser in a |
| 3 | | graphic arts facility in which graphic arts production as |
| 4 | | described in Section 2-30 of the Retailers' Occupation Tax Act |
| 5 | | takes place, including tangible personal property purchased |
| 6 | | for incorporation into real estate within a graphic arts |
| 7 | | facility and including, but not limited to, all tangible |
| 8 | | personal property used or consumed in activities such as |
| 9 | | graphic arts preliminary or pre-press production, |
| 10 | | pre-production material handling, receiving, quality control, |
| 11 | | inventory control, storage, staging, sorting, labeling, |
| 12 | | mailing, tying, wrapping, and packaging; and (iii) all tangible |
| 13 | | personal property used or consumed by the purchaser for |
| 14 | | research and development. "Production related tangible |
| 15 | | personal property" does not include (i) tangible personal |
| 16 | | property used, within or without a manufacturing or graphic |
| 17 | | arts facility, in sales, purchasing, accounting, fiscal |
| 18 | | management, marketing, personnel recruitment or selection, or |
| 19 | | landscaping or (ii) tangible personal property required to be |
| 20 | | titled or registered with a department, agency, or unit of |
| 21 | | federal, state, or local government. The Manufacturer's |
| 22 | | Purchase Credit may be used to satisfy the tax arising either |
| 23 | | from the purchase of machinery and equipment on or after |
| 24 | | September 1, 2004 for which the manufacturing machinery and |
| 25 | | equipment exemption provided by Section 2 of this Act was |
| 26 | | erroneously claimed, or the purchase of machinery and equipment |
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| | 09800SB0346ham001 | - 60 - | LRB098 04644 HLH 60486 a |
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| 1 | | on or after September 1, 2004 for which the exemption provided |
| 2 | | by paragraph (5) of Section 3-5 of this Act was erroneously |
| 3 | | claimed, but not in satisfaction of penalty, if any, and |
| 4 | | interest for failure to pay the tax when due. A purchaser of |
| 5 | | production related tangible personal property that is |
| 6 | | purchased on or after September 1, 2004 who is required to pay |
| 7 | | Illinois Use Tax or Service Use Tax on the purchase directly to |
| 8 | | the Department may utilize the Manufacturer's Purchase Credit |
| 9 | | in satisfaction of the tax arising from that purchase, but not |
| 10 | | in satisfaction of penalty and interest. A purchaser who uses |
| 11 | | the Manufacturer's Purchase Credit to purchase property on and |
| 12 | | after September 1, 2004 which is later determined not to be |
| 13 | | production related tangible personal property may be liable for |
| 14 | | tax, penalty, and interest on the purchase of that property as |
| 15 | | of the date of purchase but shall be entitled to use the |
| 16 | | disallowed Manufacturer's Purchase Credit, so long as it has |
| 17 | | not expired, on qualifying purchases of production related |
| 18 | | tangible personal property not previously subject to credit |
| 19 | | usage. The Manufacturer's Purchase Credit earned by a |
| 20 | | manufacturer or graphic arts producer expires the last day of |
| 21 | | the second calendar year following the calendar year in which |
| 22 | | the credit arose. |
| 23 | | A purchaser earning Manufacturer's Purchase Credit shall |
| 24 | | sign and file an annual Report of Manufacturer's Purchase |
| 25 | | Credit Earned for each calendar year no later than the last day |
| 26 | | of the sixth month following the calendar year in which a |
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| | 09800SB0346ham001 | - 61 - | LRB098 04644 HLH 60486 a |
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| 1 | | Manufacturer's Purchase Credit is earned. A Report of |
| 2 | | Manufacturer's Purchase Credit Earned shall be filed on forms |
| 3 | | as prescribed or approved by the Department and shall state, |
| 4 | | for each month of the calendar year: (i) the total purchase |
| 5 | | price of all purchases of exempt manufacturing or graphic arts |
| 6 | | machinery on which the credit was earned; (ii) the total State |
| 7 | | Use Tax or Service Use Tax which would have been due on those |
| 8 | | items; (iii) the percentage used to calculate the amount of |
| 9 | | credit earned; (iv) the amount of credit earned; and (v) such |
| 10 | | other information as the Department may reasonably require. A |
| 11 | | purchaser earning Manufacturer's Purchase Credit shall |
| 12 | | maintain records which identify, as to each purchase of |
| 13 | | manufacturing or graphic arts machinery and equipment on which |
| 14 | | the purchaser earned Manufacturer's Purchase Credit, the |
| 15 | | vendor (including, if applicable, either the vendor's |
| 16 | | registration number or Federal Employer Identification |
| 17 | | Number), the purchase price, and the amount of Manufacturer's |
| 18 | | Purchase Credit earned on each purchase. |
| 19 | | A purchaser using Manufacturer's Purchase Credit shall |
| 20 | | sign and file an annual Report of Manufacturer's Purchase |
| 21 | | Credit Used for each calendar year no later than the last day |
| 22 | | of the sixth month following the calendar year in which a |
| 23 | | Manufacturer's Purchase Credit is used. A Report of |
| 24 | | Manufacturer's Purchase Credit Used shall be filed on forms as |
| 25 | | prescribed or approved by the Department and shall state, for |
| 26 | | each month of the calendar year: (i) the total purchase price |
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| | 09800SB0346ham001 | - 62 - | LRB098 04644 HLH 60486 a |
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| 1 | | of production related tangible personal property purchased |
| 2 | | from Illinois suppliers; (ii) the total purchase price of |
| 3 | | production related tangible personal property purchased from |
| 4 | | out-of-state suppliers; (iii) the total amount of credit used |
| 5 | | during such month; and (iv) such other information as the |
| 6 | | Department may reasonably require. A purchaser using |
| 7 | | Manufacturer's Purchase Credit shall maintain records that |
| 8 | | identify, as to each purchase of production related tangible |
| 9 | | personal property on which the purchaser used Manufacturer's |
| 10 | | Purchase Credit, the vendor (including, if applicable, either |
| 11 | | the vendor's registration number or Federal Employer |
| 12 | | Identification Number), the purchase price, and the amount of |
| 13 | | Manufacturer's Purchase Credit used on each purchase. |
| 14 | | A purchaser that fails to file an annual Report of |
| 15 | | Manufacturer's Purchase Credit Earned or an annual Report of |
| 16 | | Manufacturer's Purchase Credit Used by the last day of the |
| 17 | | sixth month following the end of the calendar year shall |
| 18 | | forfeit all Manufacturer's Purchase Credit for that calendar |
| 19 | | year unless it establishes that its failure to file was due to |
| 20 | | reasonable cause. Manufacturer's Purchase Credit reports may |
| 21 | | be amended to report and claim credit on qualifying purchases |
| 22 | | not previously reported at any time before the credit would |
| 23 | | have expired, unless both the Department and the purchaser have |
| 24 | | agreed to an extension of the statute of limitations for the |
| 25 | | issuance of a notice of tax liability as provided in Section 4 |
| 26 | | of the Retailers' Occupation Tax Act. If the time for |
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| 1 | | assessment or refund has been extended, then amended reports |
| 2 | | for a calendar year may be filed at any time prior to the date |
| 3 | | to which the statute of limitations for the calendar year or |
| 4 | | portion thereof has been extended. Manufacturer's Purchase |
| 5 | | Credit claimed on an amended report may be used to satisfy tax |
| 6 | | liability under the Use Tax Act or the Service Use Tax Act (i) |
| 7 | | on qualifying purchases of production related tangible |
| 8 | | personal property made after the date the amended report is |
| 9 | | filed or (ii) assessed by the Department on qualifying |
| 10 | | production related tangible personal property purchased on or |
| 11 | | after September 1, 2004. |
| 12 | | If the purchaser is not the manufacturer or a graphic arts |
| 13 | | producer, but rents or leases the use of the property to a |
| 14 | | manufacturer or a graphic arts producer, the purchaser may |
| 15 | | earn, report, and use Manufacturer's Purchase Credit in the |
| 16 | | same manner as a manufacturer or graphic arts producer.
A |
| 17 | | purchaser shall not be entitled to any Manufacturer's Purchase |
| 18 | | Credit for a purchase that is required to be reported and is |
| 19 | | not timely reported as provided in this Section. A purchaser |
| 20 | | remains liable for (i) any tax that was satisfied by use of a |
| 21 | | Manufacturer's Purchase Credit, as of the date of purchase, if |
| 22 | | that use is not timely reported as required in this Section and |
| 23 | | (ii) for any applicable penalties and interest for failing to |
| 24 | | pay the tax when due.
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| 25 | | (Source: P.A. 96-116, eff. 7-31-09.)
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