Illinois-2023-SB3233-Introduced

103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3233

Introduced 2/6/2024, by Sen. Robert Peters

SYNOPSIS AS INTRODUCED:

`New Act`
`35 ILCS 5/241 new`
`215 ILCS 5/409`	`from Ch. 73, par. 1021`
`215 ILCS 5/444`	`from Ch. 73, par. 1056`

Creates the Build Illinois Homes Tax Credit Act. Provides that owners of qualified low-income housing developments are eligible for credits against the taxes imposed by the Illinois Income Tax Act or taxes, penalties, fees, charges, and payments imposed by the Illinois Insurance Code. Amends the Illinois Income Tax Act and the Illinois Insurance Code to make conforming changes. Effective immediately.

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A BILL FOR

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1 AN ACT concerning revenue.

2 Be it enacted by the People of the State of Illinois,

3 represented in the General Assembly:

4 Section 1. Short title. This Act may be cited as the Build

5 Illinois Homes Tax Credit Act.

6 Section 5. Definitions. As used in this Act, unless the

7 context clearly requires otherwise:

8 "Allocation schedule certification" means a certification

9 issued by the owner of a qualified development, or by the

10 owner's designee, under subsection (d) of Section 15 of this

11 Act. The certification shall include the following:

12 (1) the building identification number for each

13 building included in the qualified development;

14 (2) the calendar year in which the last building of

15 the qualified development was placed in service;

16 (3) the amount of the credit allowed for each year of

17 the credit period;

18 (4) the amount of credit allocated to each qualified

19 taxpayer for the qualified development for the applicable

20 tax year; and

21 (5) confirmation of whether each qualified taxpayer

22 elects to apply the credit to income tax or insurance

23 premium tax.

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1 "Authority" means:

2 (1) the Illinois Housing Development Authority; or

3 (2) the City of Chicago Department of Housing.

4 "Building identification number" means the number assigned

5 to a building within the qualified development by an Authority

6 when allocating the federal tax credit.

7 "Credit" means the credit allowed under this Act.

8 "Credit period" means a period of 6 taxable years

9 beginning with the taxable year in which a qualified

10 development is placed in service. No credit period may include

11 a taxable year beginning prior to January 1, 2025. If a

12 qualified development consists of more than one building, then

13 the qualified development is deemed to be placed in service in

14 the taxable year in which the last building of the qualified

15 development is placed in service.

16 "Department" means the Department of Revenue.

17 "Federal tax credit" means the federal low-income housing

18 tax credit provided by Section 42 of the federal Internal

19 Revenue Code, including federal low-income housing tax credits

20 issued under 26 U.S.C. 42(h)(3) and 26 U.S.C. 42(h)(4).

21 "Qualified basis" means the qualified basis of the

22 qualified development as determined under Section 42 of the

23 federal Internal Revenue Code of 1986.

24 "Qualified development" means a qualified low-income

25 housing project, as that term is defined in Section 42 of the

26 federal Internal Revenue Code of 1986, that is located in the

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1 State and is determined to be eligible for the federal tax

2 credit set forth in Section 42 of the Internal Revenue Code.

3 "Qualified taxpayer" means an individual, person, firm,

4 corporation, or other entity that owns a direct or indirect

5 interest in a qualified development and that is subject to the

6 taxes imposed by subsections (a) and (b) of Section 201 of the

7 Illinois Income Tax Act or any privilege tax or retaliatory

8 tax, penalty, fee, charge, or payment imposed by the Illinois

9 Insurance Code.

10 "Reservation letter" means a reservation letter issued by

11 the Illinois Housing Development Authority or a reservation

12 agreement issued by the City of Chicago Department of Housing.

13 "State credit eligibility statement" means a statement

14 issued by an Authority under Section 10 or documents submitted

15 in satisfaction of a statement as allowed under Section 10.

16 "State tax return" means the income tax return filed with

17 the Department or the privilege and retaliatory tax return

18 filed with the Department of Insurance, as applicable.

19 Section 10. State credit eligibility statements. Following

20 construction or rehabilitation of the qualified development,

21 the applicable Authority shall issue a State credit

22 eligibility statement with respect to each building located in

23 the qualified development certifying that the building

24 qualifies for the credit under this Act and specifying:

25 (1) the calendar year in which the last building of

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1 the qualified development was placed in service;

2 (2) the amount of the credit allowed for each year of

3 the credit period;

4 (3) the maximum qualified basis of the qualified

5 development taken into account in determining such annual

6 credit amount;

7 (4) a building identification number; and

8 (5) that the qualified development is eligible for and

9 has applied to receive a federal tax credit.

10 The State credit eligibility statement shall be issued by

11 an Authority simultaneously with IRS Form 8609. An Authority

12 may issue, and the Department and Department of Insurance may

13 accept, an IRS Form 8609, including any additional statements

14 attached to the IRS Form 8609, and the reservation letter

15 issued by the Authority for the qualified development in

16 satisfaction of both federal requirements and the requirements

17 set forth in this Section.

18 The State credit eligibility statement shall include a

19 section to be completed by the owner of the qualified

20 development annually for each year of the credit period

21 certifying that the qualified development conforms with all

22 compliance requirements, including all federal compliance

23 requirements for the federal tax credit. The State credit

24 eligibility statement shall be filed with the project owner's

25 State tax return annually for each year of the credit period.

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1 Section 15. Credit for low-income housing developments.

2 (a) For taxable years beginning on or after January 1,

3 2025, an Authority may award a credit to the owner of a

4 qualified development simultaneously with the federal tax

5 credit in an amount determined by the Authority, subject to

6 the following guidelines:

7 (1) the Authority must find that the credit is

8 necessary for the financial feasibility of the qualified

9 development;

10 (2) the aggregate amount of credits awarded to

11 qualified developments for each calendar year shall not

12 exceed $20,000,000, plus the amount of unallocated

13 credits, if any, from the preceding calendar year, plus

14 the amount of any credit recaptured or otherwise returned

15 to an Authority since the preceding calendar year;

16 (3) of the $20,000,000 annual allocation:

17 (A) 75.5% of the available credits for each

18 calendar year shall be awarded by the Illinois Housing

19 Development Authority, plus any credits the Illinois

20 Housing Development Authority did not award from prior

21 calendar years, plus the amount of any credits

22 recaptured or otherwise returned to the Illinois

23 Housing Development Authority from prior calendar

24 years; and

25 (B) 24.5% of the available credits in each

26 calendar year shall be awarded by the City of Chicago

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1 Department of Housing, plus any credits the City of

2 Chicago Department of Housing did not award from prior

3 calendar years, plus the amount of any credits

4 recaptured or otherwise returned to the City of

5 Chicago Department of Housing since the prior calendar

6 year; and

7 (4) unless otherwise provided in this Act, or unless

8 the context clearly requires otherwise, an Authority must

9 determine eligibility for credits and award credits in

10 accordance with the standards and requirements set forth

11 in Section 42 of the federal Internal Revenue Code of 1986

12 and, to the extent possible, use the same forms that are

13 used in administering the credit under Section 42 of the

14 federal Internal Revenue Code of 1986.

15 (b) For tax years during the credit period, any qualified

16 taxpayer is allowed a credit, as provided in this Act, against

17 either of the following: (i) the taxes imposed by subsections

18 (a) and (b) of Section 201 of the Illinois Income Tax Act; or

19 (ii) any privilege tax or retaliatory tax, penalty, fee,

20 charge, or payment imposed under the Illinois Insurance Code.

21 (c) A qualified taxpayer may claim a credit under this Act

22 so long as the taxpayer's direct or indirect interest in the

23 qualified development is acquired prior to the filing of its

24 tax return claiming the credit. On or before March 31

25 following each year of the credit period, the owner must

26 submit to the Department, the Department of Insurance, and the

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1 applicable Authority an allocation schedule certification, in

2 an electronic format prescribed by the Department, the

3 Department of Insurance, and the Authority, respectively,

4 detailing the amount of the credit allocated to the qualified

5 taxpayer for the applicable year and stating whether the

6 qualified taxpayer has elected to claim the credit against the

7 taxpayer's State income tax or insurance privilege tax or

8 retaliatory tax liability. The taxpayer may assign to a

9 designee the duty of preparing and submitting the allocation

10 schedule certification. In that case, the designee must

11 provide the allocation schedule certification to the

12 Department, the Department of Insurance, and the applicable

13 Authority on or before the deadline for submission. The

14 qualified taxpayer must notify the Department, the Department

15 of Insurance, and the applicable Authority if it assigns that

16 duty to its designee.

17 The allocation schedule certification submitted under this

18 Section may be amended if the State credit eligibility

19 statement for a project is received after the deadline for

20 filing the allocation schedule certification. Any amendment to

21 an allocation schedule certification shall be filed before the

22 taxpayer attempts to claim tax credits associated with the

23 applicable State credit eligibility statement. Each qualified

24 taxpayer is allowed to claim its awarded amount of credit

25 subject to any restrictions set forth in this Section. If the

26 credit is to be taken against the income tax and the qualified

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1 taxpayer is a pass-through entity, then the provisions of

2 Section 251 of the Illinois Income Tax Act apply.

3 (d) No credit may be awarded under this Act unless the

4 qualified development is the subject of a recorded restrictive

5 covenant requiring the development to be maintained and

6 operated as a qualified development; this requirement for a

7 recorded restrictive covenant may be satisfied by the

8 agreement for an extended low-income housing commitment

9 required for the federal tax credits as defined in Section

10 42(h)(6)(B) of the federal Internal Revenue Code of 1986.

11 (e) If, during a taxable year, there is a determination

12 that no recorded restrictive covenant meeting the requirements

13 of subsection (d) was in effect as of the beginning of that

14 year, the determination shall not apply to any period before

15 that year and subsection (e) shall be applied without regard

16 to that determination if the failure is corrected within one

17 year after the date of the determination.

18 (f) The tax credit under this Act may not reduce the

19 taxpayer's liability to less than zero. If the amount of the

20 tax credit exceeds the tax liability for the year, the excess

21 may be carried forward and applied to the tax liability of the

22 5 taxable years following the excess credit year. The credit

23 must be applied to the earliest year for which there is a tax

24 liability. If there are credits from more than one tax year

25 that are available to offset a liability, then the earlier

26 credit must be applied first. Credits that are initially

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1 claimed against taxes imposed by the Illinois Income Tax Act

2 may be carried forward only against the taxpayer's future

3 Illinois Income Tax liability. Credits that are initially

4 claimed against taxes, penalties, fees, charges, and payments

5 imposed by the Illinois Insurance Code may be carried forward

6 only against taxes, penalties, fees, charges, and payments

7 imposed by the Illinois Insurance Code. Credits that are not

8 claimed or carried forward may not be refunded to the

9 taxpayer. The qualified taxpayer is solely responsible for

10 correctly filing tax returns, and an Authority is not

11 responsible for monitoring the calculation of taxes under this

12 Section.

13 (g) By March 31, 2025 and by March 31 of each year

14 thereafter, each Authority shall provide to the Department and

15 the Department of Insurance an electronic file containing all

16 data related to all State credit eligibility statements issued

17 during the preceding year in the manner and form as provided by

18 each respective Department.

19 (h) Each Authority is entitled to a reservation fee of 1%

20 of the credit awarded under this Section for each year of the

21 award to support the cost of compliance monitoring. An

22 Authority may exercise the option to impose a compliance fee

23 or a penalty in the exercise of its compliance monitoring

24 function under this Act.

25 Section 20. Recapture. If, under Section 42 of the

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1 Internal Revenue Code, a portion of any federal tax credit

2 claimed with respect to a qualified development for which a

3 credit has been awarded under this Act is required by the

4 Internal Revenue Service to be recaptured during the first 6

5 years after a project is placed in service, then, within 60

6 days after becoming aware of the federal tax credit recapture,

7 the project owner shall provide the Department, the Department

8 of Insurance, and the applicable Authority with notice of the

9 federal tax credit recapture. Notice shall be provided in the

10 manner and form as provided by the Department, the Department

11 of Insurance, and the Authority, respectively. If an Authority

12 issues a federal Form 8823 to the owner of a qualified

13 development that has been awarded a credit under this Act, and

14 an Authority has not been notified within 6 months of filing

15 the Form 8823 that the noncompliance has been remedied, an

16 Authority shall submit the Form 8823 to the Department or

17 Department of Insurance, as applicable. The amount of credit

18 subject to recapture shall be proportionately equal to the

19 amount of the qualified development's federal tax credits that

20 are subject to recapture. If the project owner (or one of the

21 project owner's direct or indirect members) fails to notify

22 the Department or the Department of Insurance, as applicable,

23 of any recapture of the federal tax credit, then the entire

24 amount of the State tax credit awarded for the qualified

25 development is subject to recapture. The qualified taxpayer

26 subject to recapture shall increase the qualified taxpayer's

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1 tax by the amount of any credit subject to recapture in the tax

2 year the qualified taxpayer is notified of the recapture. If

3 multiple taxpayers claimed credit with respect to the building

4 for which credit is to be recaptured, each of those taxpayers

5 shall be liable for a portion of the recapture equal to the

6 percentages of credit with respect to the building originally

7 claimed by the taxpayer.

8 Section 25. Filing requirements. An owner of a qualified

9 development that has been awarded a credit and each qualified

10 taxpayer claiming any portion of the credit must file with

11 their State tax returns a copy of the State credit eligibility

12 statement issued by an Authority for that qualified

13 development. In addition, the owner of a qualified development

14 or its designee shall file a copy of the allocation schedule

15 certification prior to any tax return being filed claiming a

16 State credit for such qualified development. A qualified

17 taxpayer receiving any allocated portion of a credit through a

18 pass-through entity shall attach to its State tax return a

19 copy of the Schedule K-1-P for that taxable year.

20 Section 30. Compliance monitoring. An Authority, in

21 consultation with the Department and Department of Insurance,

22 shall monitor and oversee compliance with the provisions of

23 this Act and shall report specific occurrences of

24 noncompliance to the Department and the Department of

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1 Insurance in the manner and form as provided by the Department

2 and the Department of Insurance. An Authority shall make every

3 effort to monitor and report noncompliance using the same

4 procedures used for compliance monitoring of the federal tax

5 credits.

6 Section 35. Report to the General Assembly.

7 (a) Each Authority must, by March 31, 2026 and by March 31

8 of each year thereafter, provide a written report to the

9 General Assembly and must publish that report on its website.

10 (b) The report shall:

11 (1) set forth the number of qualified developments

12 that have been awarded tax credits under this Act during

13 the calendar year and the total number of units supported

14 by each qualified development;

15 (2) describe each qualified development that has been

16 awarded tax credits under this Act, including, without

17 limitation, the geographic location of the qualified

18 development, the household type, the income levels

19 intended to be served by the qualified development, and

20 the rents or set-asides authorized for each qualified

21 development;

22 (3) provide housing market information that

23 demonstrates how the qualified developments supported by

24 the tax credits are addressing the need for affordable

25 housing within the communities they are intended to serve

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1 as well as information about any remaining disparities in

2 the affordability of housing within those communities; and

3 (4) provide information about the percentage of

4 qualified developments that were awarded credits and that

5 received incentive scoring points as a result of the

6 general contractor, property manager, architect, or

7 sponsor being certified under the Business Enterprise

8 Program for Minorities, Females, and Persons with a

9 Disability.

10 Section 40. Exempt from automatic sunset. The credit under

11 this Act is exempt from the provisions of Section 250 of the

12 Illinois Income Tax Act.

13 Section 900. The Illinois Income Tax Act is amended by

14 adding Section 241 as follows:

15 (35 ILCS 5/241 new)

16 Sec. 241. Build Illinois Homes Tax Credit Act.

17 (a) For taxable years beginning on or after January 1,

18 2025, any eligible taxpayer with respect to a credit awarded

19 in accordance with the Build Illinois Homes Tax Credit Act

20 that is named on an allocation schedule certification for a

21 particular tax year is entitled to a credit against the taxes

22 imposed by subsections (a) and (b) of Section 201 as provided

23 in the Build Illinois Homes Tax Credit Act.

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1 (b) The taxpayer shall attach a copy of the allocation

2 schedule certification and the State credit eligibility

3 certificate issued under the Build Illinois Homes Tax Credit

4 Act to the tax return on which the credits are to be claimed.

5 (c) If, during any taxable year, a taxpayer is notified of

6 a recapture of a credit previously claimed on a State income

7 tax return in accordance with 42 U.S.C. 42, the tax imposed

8 under subsections (a) and (b) of Section 201 for that taxpayer

9 for that taxable year shall be increased. The amount of the

10 increase shall be determined by (i) recomputing the Build

11 Illinois Homes Tax Credit that would have been allowed for the

12 year in which the credit was originally allowed by eliminating

13 the recaptured amount from such computation, and (ii)

14 subtracting that recomputed credit from the amount of credit

15 previously allowed. No Build Illinois Homes Tax Credit shall

16 be allowed with respect to any credit subject to a recapture

17 notice for any taxable year ending after the issuance of a

18 recapture notice.

19 (d) This Section is exempt from the provisions of Section

20 250.

21 Section 905. The Illinois Insurance Code is amended by

22 changing Sections 409 and 444 as follows:

23 (215 ILCS 5/409) (from Ch. 73, par. 1021)

24 Sec. 409. Annual privilege tax payable by companies.

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1 (1) As of January 1, 1999 for all health maintenance

2 organization premiums written; as of July 1, 1998 for all

3 premiums written as accident and health business, voluntary

4 health service plan business, dental service plan business, or

5 limited health service organization business; and as of

6 January 1, 1998 for all other types of insurance premiums

7 written, every company doing any form of insurance business in

8 this State, including, but not limited to, every risk

9 retention group, and excluding all fraternal benefit

10 societies, all farm mutual companies, all religious charitable

11 risk pooling trusts, and excluding all statutory residual

12 market and special purpose entities in which companies are

13 statutorily required to participate, whether incorporated or

14 otherwise, shall pay, for the privilege of doing business in

15 this State, to the Director for the State treasury a State tax

16 equal to 0.5% of the net taxable premium written, together

17 with any amounts due under Section 444 of this Code, except

18 that the tax to be paid on any premium derived from any

19 accident and health insurance or on any insurance business

20 written by any company operating as a health maintenance

21 organization, voluntary health service plan, dental service

22 plan, or limited health service organization shall be equal to

23 0.4% of such net taxable premium written, together with any

24 amounts due under Section 444. Upon the failure of any company

25 to pay any such tax due, the Director may, by order, revoke or

26 suspend the company's certificate of authority after giving 20

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1 days written notice to the company, or commence proceedings

2 for the suspension of business in this State under the

3 procedures set forth by Section 401.1 of this Code. The gross

4 taxable premium written shall be the gross amount of premiums

5 received on direct business during the calendar year on

6 contracts covering risks in this State, except premiums on

7 annuities, premiums on which State premium taxes are

8 prohibited by federal law, premiums paid by the State for

9 health care coverage for Medicaid eligible insureds as

10 described in Section 5-2 of the Illinois Public Aid Code,

11 premiums paid for health care services included as an element

12 of tuition charges at any university or college owned and

13 operated by the State of Illinois, premiums on group insurance

14 contracts under the State Employees Group Insurance Act of

15 1971, and except premiums for deferred compensation plans for

16 employees of the State, units of local government, or school

17 districts. The net taxable premium shall be the gross taxable

18 premium written reduced only by the following:

19 (a) the amount of premiums returned thereon which

20 shall be limited to premiums returned during the same

21 preceding calendar year and shall not include the return

22 of cash surrender values or death benefits on life

23 policies including annuities;

24 (b) dividends on such direct business that have been

25 paid in cash, applied in reduction of premiums or left to

26 accumulate to the credit of policyholders or annuitants.

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1 In the case of life insurance, no deduction shall be made

2 for the payment of deferred dividends paid in cash to

3 policyholders on maturing policies; dividends left to

4 accumulate to the credit of policyholders or annuitants

5 shall be included as gross taxable premium written when

6 such dividend accumulations are applied to purchase

7 paid-up insurance or to shorten the endowment or premium

8 paying period.

9 (2) The annual privilege tax payment due from a company

10 under subsection (4) of this Section may be reduced by: (a) the

11 excess amount, if any, by which the aggregate income taxes

12 paid by the company, on a cash basis, for the preceding

13 calendar year under Sections 601 and 803 of the Illinois

14 Income Tax Act exceed 1.5% of the company's net taxable

15 premium written for that prior calendar year, as determined

16 under subsection (1) of this Section; and (b) the amount of any

17 fire department taxes paid by the company during the preceding

18 calendar year under Section 11-10-1 of the Illinois Municipal

19 Code. Any deductible amount or offset allowed under items (a)

20 and (b) of this subsection for any calendar year will not be

21 allowed as a deduction or offset against the company's

22 privilege tax liability for any other taxing period or

23 calendar year.

24 (3) If a company survives or was formed by a merger,

25 consolidation, reorganization, or reincorporation, the

26 premiums received and amounts returned or paid by all

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1 companies party to the merger, consolidation, reorganization,

2 or reincorporation shall, for purposes of determining the

3 amount of the tax imposed by this Section, be regarded as

4 received, returned, or paid by the surviving or new company.

5 (4)(a) All companies subject to the provisions of this

6 Section shall make an annual return for the preceding calendar

7 year on or before March 15 setting forth such information on

8 such forms as the Director may reasonably require. Payments of

9 quarterly installments of the taxpayer's total estimated tax

10 for the current calendar year shall be due on or before April

11 15, June 15, September 15, and December 15 of such year, except

12 that all companies transacting insurance in this State whose

13 annual tax for the immediately preceding calendar year was

14 less than $5,000 shall make only an annual return. Failure of a

15 company to make the annual payment, or to make the quarterly

16 payments, if required, of at least 25% of either (i) the total

17 tax paid during the previous calendar year or (ii) 80% of the

18 actual tax for the current calendar year shall subject it to

19 the penalty provisions set forth in Section 412 of this Code.

20 (b) Notwithstanding the foregoing provisions, no annual

21 return shall be required or made on March 15, 1998, under this

22 subsection. For the calendar year 1998:

23 (i) each health maintenance organization shall have no

24 estimated tax installments;

25 (ii) all companies subject to the tax as of July 1,

26 1998 as set forth in subsection (1) shall have estimated

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1 tax installments due on September 15 and December 15 of

2 1998 which installments shall each amount to no less than

3 one-half of 80% of the actual tax on its net taxable

4 premium written during the period July 1, 1998, through

5 December 31, 1998; and

6 (iii) all other companies shall have estimated tax

7 installments due on June 15, September 15, and December 15

8 of 1998 which installments shall each amount to no less

9 than one-third of 80% of the actual tax on its net taxable

10 premium written during the calendar year 1998.

11 In the year 1999 and thereafter all companies shall make

12 annual and quarterly installments of their estimated tax as

13 provided by paragraph (a) of this subsection.

14 (5) In addition to the authority specifically granted

15 under Article XXV of this Code, the Director shall have such

16 authority to adopt rules and establish forms as may be

17 reasonably necessary for purposes of determining the

18 allocation of Illinois corporate income taxes paid under

19 subsections (a) through (d) of Section 201 of the Illinois

20 Income Tax Act amongst members of a business group that files

21 an Illinois corporate income tax return on a unitary basis,

22 for purposes of regulating the amendment of tax returns, for

23 purposes of defining terms, and for purposes of enforcing the

24 provisions of Article XXV of this Code. The Director shall

25 also have authority to defer, waive, or abate the tax imposed

26 by this Section if in his opinion the company's solvency and

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1 ability to meet its insured obligations would be immediately

2 threatened by payment of the tax due.

3 (6) This Section is subject to the provisions of Section

4 10 of the New Markets Development Program Act.

5 (7) This Section is subject to the provisions of the Build

6 Illinois Homes Tax Credit Act.

7 (Source: P.A. 97-813, eff. 7-13-12; 98-1169, eff. 1-9-15.)

8 (215 ILCS 5/444) (from Ch. 73, par. 1056)

9 Sec. 444. Retaliation.

10 (1) Whenever the existing or future laws of any other

11 state or country shall require of companies incorporated or

12 organized under the laws of this State as a condition

13 precedent to their doing business in such other state or

14 country, compliance with laws, rules, regulations, and

15 prohibitions more onerous or burdensome than the rules and

16 regulations imposed by this State on foreign or alien

17 companies, or shall require any deposit of securities or other

18 obligations in such state or country, for the protection of

19 policyholders or otherwise or require of such companies or

20 agents thereof or brokers the payment of penalties, fees,

21 charges, or taxes greater than the penalties, fees, charges,

22 or taxes required in the aggregate for like purposes by this

23 Code or any other law of this State, of foreign or alien

24 companies, agents thereof or brokers, then such laws, rules,

25 regulations, and prohibitions of said other state or country

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1 shall apply to companies incorporated or organized under the

2 laws of such state or country doing business in this State, and

3 all such companies, agents thereof, or brokers doing business

4 in this State, shall be required to make deposits, pay

5 penalties, fees, charges, and taxes, in amounts equal to those

6 required in the aggregate for like purposes of Illinois

7 companies doing business in such state or country, agents

8 thereof or brokers. Whenever any other state or country shall

9 refuse to permit any insurance company incorporated or

10 organized under the laws of this State to transact business

11 according to its usual plan in such other state or country, the

12 director may, if satisfied that such company of this State is

13 solvent, properly managed, and can operate legally under the

14 laws of such other state or country, forthwith suspend or

15 cancel the license of every insurance company doing business

16 in this State which is incorporated or organized under the

17 laws of such other state or country to the extent that it

18 insures in this State against any of the risks or hazards which

19 are sought to be insured against by the company of this State

20 in such other state or country.

21 (2) The provisions of this Section shall not apply to

22 residual market or special purpose assessments or guaranty

23 fund or guaranty association assessments, both under the laws

24 of this State and under the laws of any other state or country,

25 and any tax offset or credit for any such assessment shall, for

26 purposes of this Section, be treated as a tax paid both under

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1 the laws of this State and under the laws of any other state or

2 country.

3 (3) The terms "penalties", "fees", "charges", and "taxes"

4 in subsection (1) of this Section shall include: the

5 penalties, fees, charges, and taxes collected on a cash basis

6 under State law and referenced within Article XXV exclusive of

7 any items referenced by subsection (2) of this Section, but

8 including any tax offset allowed under Section 531.13 of this

9 Code; the aggregate Illinois corporate income taxes paid under

10 Sections 601 and 803 of the Illinois Income Tax Act during the

11 calendar year for which the retaliatory tax calculation is

12 being made, less the recapture of any Illinois corporate

13 income tax cash refunds to the extent that the amount of tax

14 refunded was reported as part of the Illinois basis in the

15 calculation of the retaliatory tax for a prior tax year,

16 provided that such recaptured refund shall not exceed the

17 amount necessary for equivalence of the Illinois basis with

18 the state of incorporation basis in such tax year, and after

19 any tax offset allowed under Section 531.13 of this Code;

20 income or personal property taxes imposed by other states or

21 countries; penalties, fees, charges, and taxes of other states

22 or countries imposed for purposes like those of the penalties,

23 fees, charges, and taxes specified in Article XXV of this Code

24 exclusive of any item referenced in subsection (2) of this

25 Section; and any penalties, fees, charges, and taxes required

26 as a franchise, privilege, or licensing tax for conducting the

SB3233

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LRB103 38198 HLH 68331 b

1 business of insurance whether calculated as a percentage of

2 income, gross receipts, premium, or otherwise.

3 (4) Nothing contained in this Section or Section 409 or

4 Section 444.1 is intended to authorize or expand any power of

5 local governmental units or municipalities to impose taxes,

6 fees, or charges.

7 (5) This Section is subject to the provisions of Section

8 10 of the New Markets Development Program Act.

9 (6) This Section is subject to the provisions of the Build

10 Illinois Homes Tax Credit Act.

11 (Source: P.A. 98-1169, eff. 1-9-15.)