Bill Text: IL SB1809 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that the recipient of a credit under the Act may apply for a certificate of transferability of credit from the Department of Commerce and Economic Opportunity for the amount of the credit not previously claimed. Provides that the transferability certificate may be transferred or sold by the recipient to another Illinois taxpayer. Provides that unused Economic Development for a Growing Economy tax credits may be carried forward for a period of 10 years (currently, 5 years). Makes other changes.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2023-03-10 - Rule 3-9(a) / Re-referred to Assignments [SB1809 Detail]

Download: Illinois-2023-SB1809-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1809 Introduced 2/9/2023, by Sen. Sally J. Turner SYNOPSIS AS INTRODUCED:
35 ILCS 5/211
35 ILCS 10/5-45
Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that the recipient of a credit under the Act may apply for a certificate of transferability of credit from the Department of Commerce and Economic Opportunity for the amount of the credit not previously claimed. Provides that the transferability certificate may be transferred or sold by the recipient to another Illinois taxpayer. Provides that unused Economic Development for a Growing Economy tax credits may be carried forward for a period of 10 years (currently, 5 years). Makes other changes.
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A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Income Tax Act is amended by
changing Section 211 as follows:
(35 ILCS 5/211)
Sec. 211. Economic Development for a Growing Economy Tax
Credit. For tax years beginning on or after January 1, 1999, a
Taxpayer who has entered into an Agreement (including a New
Construction EDGE Agreement) under the Economic Development
for a Growing Economy Tax Credit Act is entitled to a credit
against the taxes imposed under subsections (a) and (b) of
Section 201 of this Act in an amount to be determined in the
Agreement. If the Taxpayer is a partnership or Subchapter S
corporation, the credit shall be allowed to the partners or
shareholders in accordance with the determination of income
and distributive share of income under Sections 702 and 704
and subchapter S of the Internal Revenue Code. The Department,
in cooperation with the Department of Commerce and Economic
Opportunity, shall prescribe rules to enforce and administer
the provisions of this Section. This Section is exempt from
the provisions of Section 250 of this Act.
The credit shall be subject to the conditions set forth in

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the Agreement and the following limitations:
(1) The tax credit shall not exceed the Incremental
Income Tax (as defined in Section 5-5 of the Economic
Development for a Growing Economy Tax Credit Act) with
respect to the project; additionally, the New Construction
EDGE Credit shall not exceed the New Construction EDGE
Incremental Income Tax (as defined in Section 5-5 of the
Economic Development for a Growing Economy Tax Credit
Act).
(2) The amount of the credit allowed during the tax
year plus the sum of all amounts allowed in prior years
shall not exceed 100% of the aggregate amount expended by
the Taxpayer during all prior tax years on approved costs
defined by Agreement.
(3) The amount of the credit shall be determined on an
annual basis. Except as applied in a carryover year
pursuant to Section 211(4) of this Act, the credit may not
be applied against any State income tax liability in more
than 10 taxable years; provided, however, that (i) an
eligible business certified by the Department of Commerce
and Economic Opportunity under the Corporate Headquarters
Relocation Act may not apply the credit against any of its
State income tax liability in more than 15 taxable years
and (ii) credits allowed to that eligible business are
subject to the conditions and requirements set forth in
Sections 5-35 and 5-45 of the Economic Development for a

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Growing Economy Tax Credit Act and Section 5-51 as
applicable to New Construction EDGE Credits.
(4) The credit may not exceed the amount of taxes
imposed pursuant to subsections (a) and (b) of Section 201
of this Act. Any credit that is unused in the year the
credit is computed may be carried forward and applied to
the tax liability of the 10 5 taxable years following the
excess credit year, except as otherwise provided under
paragraph (4.5) of this Section. It is the intent of the
General Assembly that the carry forward period for all
credits that have not expired as of the effective date of
this amendatory Act of the 103rd General Assembly shall be
extended to 10 years. The credit shall be applied to the
earliest year for which there is a tax liability. If there
are credits from more than one tax year that are available
to offset a liability, the earlier credit shall be applied
first.
(4.5) The Department of Commerce and Economic
Opportunity, in consultation with the Department of
Revenue, shall adopt rules to extend the sunset of any
earned, existing, or unused credit as provided for in
Section 605-1055 of the Department of Commerce and
Economic Opportunity Law of the Civil Administrative Code
of Illinois.
(5) No credit shall be allowed with respect to any
Agreement for any taxable year ending after the

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Noncompliance Date. Upon receiving notification by the
Department of Commerce and Economic Opportunity of the
noncompliance of a Taxpayer with an Agreement, the
Department shall notify the Taxpayer that no credit is
allowed with respect to that Agreement for any taxable
year ending after the Noncompliance Date, as stated in
such notification. If any credit has been allowed with
respect to an Agreement for a taxable year ending after
the Noncompliance Date for that Agreement, any refund paid
to the Taxpayer for that taxable year shall, to the extent
of that credit allowed, be an erroneous refund within the
meaning of Section 912 of this Act.
If, during any taxable year, a taxpayer ceases
operations at a project location that is the subject of
that Agreement with the intent to terminate operations in
the State, the tax imposed under subsections (a) and (b)
of Section 201 of this Act for such taxable year shall be
increased by the amount of any credit allowed under the
Agreement for that project location prior to the date the
taxpayer ceases operations.
(6) For purposes of this Section, the terms
"Agreement", "Incremental Income Tax", "New Construction
EDGE Agreement", "New Construction EDGE Credit", "New
Construction EDGE Incremental Income Tax", and
"Noncompliance Date" have the same meaning as when used in
the Economic Development for a Growing Economy Tax Credit

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Act.
(Source: P.A. 101-9, eff. 6-5-19; 102-16, eff. 6-17-21;
102-40, eff. 6-25-21; 102-687, eff. 12-17-21.)
Section 10. The Economic Development for a Growing Economy
Tax Credit Act is amended by changing Section 5-45 as follows:
(35 ILCS 10/5-45)
Sec. 5-45. Amount and duration of the credit.
(a) The Department shall determine the amount and duration
of the credit awarded under this Act. The duration of the
credit may not exceed 10 taxable years. The credit may be
stated as a percentage of the Incremental Income Tax
attributable to the applicant's project and may include a
fixed dollar limitation.
(b) Notwithstanding subsection (a), and except as the
credit may be applied in a carryover year pursuant to Section
211(4) of the Illinois Income Tax Act, the credit may be
applied against the State income tax liability in more than 10
taxable years but not in more than 15 taxable years for an
eligible business that (i) qualifies under this Act and the
Corporate Headquarters Relocation Act and has in fact
undertaken a qualifying project within the time frame
specified by the Department of Commerce and Economic
Opportunity under that Act, and (ii) applies against its State
income tax liability, during the entire 15-year period, no

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more than 60% of the maximum credit per year that would
otherwise be available under this Act.
(b-5) Notwithstanding subsection (a) or (b), a recipient
of a credit may request a certificate of transferability of
credit from the Department for the amount of credit not
previously claimed. A transferability certificate so issued
may be transferred or sold by the recipient to another
Illinois taxpayer. Transferors and sellers shall submit to the
Department of Revenue a notification of any transfer or sale
of tax credits within 30 days after the transfer or sale of
those tax credits. The notification, which shall be in the
form prescribed by the Department, shall include the
transferor's tax credit balance prior to transfer, the credit
certificate number, the identifying number of the EDGE
agreement, the transferor's remaining tax credit balance after
transfer, all tax identification numbers for both transferor
and transferee, the date of transfer, the amount transferred,
a copy of the credit certificate, and any other information
required by the Department of Revenue. The transfer or sale of
the credit does not extend the time in which the credit can be
used. The carry forward period for a credit that is
transferred or sold begins on the date on which the credit was
originally granted by the Department. To the extent the
transferor did not have rights to claim or use the credit at
the time of the transfer or sale, the Department of Revenue
shall either disallow the credit claimed by the transferee or

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recapture the credit from the transferee through any
collection method authorized by statute. In such case, the
transferee's recourse is against the transferor.
(c) Nothing in this Section shall prevent the Department,
in consultation with the Department of Revenue, from adopting
rules to extend the sunset of any earned, existing, and unused
tax credit or credits a taxpayer may be in possession of, as
provided for in Section 605-1070 of the Department of Commerce
and Economic Opportunity Law of the Civil Administrative Code
of Illinois, notwithstanding the carry-forward provisions
pursuant to paragraph (4) of Section 211 of the Illinois
Income Tax Act.
(Source: P.A. 102-16, eff. 6-17-21; 102-813, eff. 5-13-22.)