Bill Text: IL SB3401 | 2011-2012 | 97th General Assembly | Introduced

---

Bill Title: Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that, on and after the effective date of the amendatory Act, any Taxpayer that is awarded a credit under the Act may elect to claim the Credit against its withholding tax obligations (now, only certain taxpayers that are engaged in motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing may claim the credit against withholdings). Effective immediately.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2013-01-08 - Session Sine Die [SB3401 Detail]

Download: Illinois-2011-SB3401-Introduced.html

---

97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 SB3401 Introduced 2/7/2012, by Sen. Carole Pankau SYNOPSIS AS INTRODUCED:
35 ILCS 10/5-15
Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that, on and after the effective date of the amendatory Act, any Taxpayer that is awarded a credit under the Act may elect to claim the Credit against its withholding tax obligations (now, only certain taxpayers that are engaged in motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing may claim the credit against withholdings). Effective immediately.
LRB097 19857 HLH 65138 b
FISCAL NOTE ACT MAY APPLY
A BILL FOR
SB3401 LRB097 19857 HLH 65138 b
AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Economic Development for a Growing Economy
Tax Credit Act is amended by changing Section 5-15 as follows:
(35 ILCS 10/5-15)
(Text of Section before amendment by P.A. 97-636)
Sec. 5-15. Tax Credit Awards. Subject to the conditions set
forth in this Act, a Taxpayer is entitled to a Credit against
or, as described in subsection (g) of this Section, a payment
towards taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act that may be imposed
on the Taxpayer for a taxable year beginning on or after
January 1, 1999, if the Taxpayer is awarded a Credit by the
Department under this Act for that taxable year.
(a) The Department shall make Credit awards under this Act
to foster job creation and retention in Illinois.
(b) A person that proposes a project to create new jobs in
Illinois must enter into an Agreement with the Department for
the Credit under this Act.
(c) The Credit shall be claimed for the taxable years
specified in the Agreement.
(d) The Credit shall not exceed the Incremental Income Tax

SB3401 - 2 - LRB097 19857 HLH 65138 b
attributable to the project that is the subject of the
Agreement.
(e) Nothing herein shall prohibit a Tax Credit Award to an
Applicant that uses a PEO if all other award criteria are
satisfied.
(f) In lieu of the Credit allowed under this Act against
the taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act for any taxable year
ending on or after December 31, 2009, the Taxpayer may elect to
claim the Credit against its obligation to pay over withholding
under Section 704A of the Illinois Income Tax Act.
(1) Prior to the effective date of this amendatory Act
of the 97th General Assembly, the The election under this
subsection (f) may be made only by a Taxpayer that (i) is
primarily engaged in one of the following business
activities: water purification and treatment, motor
vehicle metal stamping, automobile manufacturing,
automobile and light duty motor vehicle manufacturing,
motor vehicle manufacturing, light truck and utility
vehicle manufacturing, heavy duty truck manufacturing,
motor vehicle body manufacturing, cable television
infrastructure design or manufacturing, or wireless
telecommunication or computing terminal device design or
manufacturing for use on public networks and (ii) meets the
following criteria:
(A) the Taxpayer (i) had an Illinois net loss or an

SB3401 - 3 - LRB097 19857 HLH 65138 b
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, (iii) has an
Agreement under this Act on December 14, 2009 (the
effective date of Public Act 96-834), and (iv) is in
compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or an
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, and (iii) has
applied for an Agreement within 365 days after December
14, 2009 (the effective date of Public Act 96-834);
(C) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois
Income Tax Act in a taxable year ending during calendar
year 2008, (ii) has applied for an Agreement within 150
days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 400
new jobs in Illinois, (iv) retains at least 2,000 jobs
in Illinois that would have been at risk of relocation
out of Illinois over a 10-year period, and (v) makes a
capital investment of at least $75,000,000;

SB3401 - 4 - LRB097 19857 HLH 65138 b
(D) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois
Income Tax Act in a taxable year ending during calendar
year 2009, (ii) has applied for an Agreement within 150
days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 150
new jobs, (iv) retains at least 1,000 jobs in Illinois
that would have been at risk of relocation out of
Illinois over a 10-year period, and (v) makes a capital
investment of at least $57,000,000; or
(E) the Taxpayer (i) employed at least 2,500
full-time employees in the State during the year in
which the Credit is awarded, (ii) commits to make at
least $500,000,000 in combined capital improvements
and project costs under the Agreement, (iii) applies
for an Agreement between January 1, 2011 and June 30,
2011, (iv) executes an Agreement for the Credit during
calendar year 2011, and (v) was incorporated no more
than 5 years before the filing of an application for an
Agreement.
(1.5) The election under this subsection (f) may also
be made by a Taxpayer for any Credit awarded pursuant to an
agreement that was executed between January 1, 2011 and
June 30, 2011, if the Taxpayer (i) is primarily engaged in
the manufacture of inner tubes or tires, or both, from
natural and synthetic rubber, (ii) employs a minimum of

SB3401 - 5 - LRB097 19857 HLH 65138 b
2,400 full-time employees in Illinois at the time of
application, (iii) creates at least 350 full-time jobs and
retains at least 250 full-time jobs in Illinois that would
have been at risk of being created or retained outside of
Illinois, and (iv) makes a capital investment of at least
$200,000,000 at the project location.
(1.8) On and after the effective date of this
amendatory Act of the 97th General Assembly, any Taxpayer
that is awarded a Credit under this Act may elect to claim
the Credit against its obligation to pay over withholding
under Section 704A of the Illinois Income Tax Act.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under
Section 704A of the Illinois Income Tax Act during the
first calendar year beginning after the end of the taxable
year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once
made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f)
elects to claim the Credit against its withholdings as
provided in this subsection (f), then, on and after the
date of the election, the terms of the Agreement between
the Taxpayer and the Department may not be further amended
during the term of the Agreement.

SB3401 - 6 - LRB097 19857 HLH 65138 b
(g) A pass-through entity that has been awarded a credit
under this Act, its shareholders, or its partners may treat
some or all of the credit awarded pursuant to this Act as a tax
payment for purposes of the Illinois Income Tax Act. The term
"tax payment" means a payment as described in Article 6 or
Article 8 of the Illinois Income Tax Act or a composite payment
made by a pass-through entity on behalf of any of its
shareholders or partners to satisfy such shareholders' or
partners' taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act. In no event shall
the amount of the award credited pursuant to this Act exceed
the Illinois income tax liability of the pass-through entity or
its shareholders or partners for the taxable year.
(Source: P.A. 96-834, eff. 12-14-09; 96-836, eff. 12-16-09;
96-905, eff. 6-4-10; 96-1000, eff. 7-2-10; 96-1534, eff.
3-4-11; 97-2, eff. 5-6-11.)
(Text of Section after amendment by P.A. 97-636)
Sec. 5-15. Tax Credit Awards. Subject to the conditions set
forth in this Act, a Taxpayer is entitled to a Credit against
or, as described in subsection (g) of this Section, a payment
towards taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act that may be imposed
on the Taxpayer for a taxable year beginning on or after
January 1, 1999, if the Taxpayer is awarded a Credit by the
Department under this Act for that taxable year.

SB3401 - 7 - LRB097 19857 HLH 65138 b
(a) The Department shall make Credit awards under this Act
to foster job creation and retention in Illinois.
(b) A person that proposes a project to create new jobs in
Illinois must enter into an Agreement with the Department for
the Credit under this Act.
(c) The Credit shall be claimed for the taxable years
specified in the Agreement.
(d) The Credit shall not exceed the Incremental Income Tax
attributable to the project that is the subject of the
Agreement.
(e) Nothing herein shall prohibit a Tax Credit Award to an
Applicant that uses a PEO if all other award criteria are
satisfied.
(f) In lieu of the Credit allowed under this Act against
the taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act for any taxable year
ending on or after December 31, 2009, the Taxpayer may elect to
claim the Credit against its obligation to pay over withholding
under Section 704A of the Illinois Income Tax Act.
(1) Prior to the effective date of this amendatory Act
of the 97th General Assembly, the The election under this
subsection (f) may be made only by a Taxpayer that (i) is
primarily engaged in one of the following business
activities: water purification and treatment, motor
vehicle metal stamping, automobile manufacturing,
automobile and light duty motor vehicle manufacturing,

SB3401 - 8 - LRB097 19857 HLH 65138 b
motor vehicle manufacturing, light truck and utility
vehicle manufacturing, heavy duty truck manufacturing,
motor vehicle body manufacturing, cable television
infrastructure design or manufacturing, or wireless
telecommunication or computing terminal device design or
manufacturing for use on public networks and (ii) meets the
following criteria:
(A) the Taxpayer (i) had an Illinois net loss or an
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, (iii) has an
Agreement under this Act on December 14, 2009 (the
effective date of Public Act 96-834), and (iv) is in
compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or an
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, and (iii) has
applied for an Agreement within 365 days after December
14, 2009 (the effective date of Public Act 96-834);
(C) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois

SB3401 - 9 - LRB097 19857 HLH 65138 b
Income Tax Act in a taxable year ending during calendar
year 2008, (ii) has applied for an Agreement within 150
days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 400
new jobs in Illinois, (iv) retains at least 2,000 jobs
in Illinois that would have been at risk of relocation
out of Illinois over a 10-year period, and (v) makes a
capital investment of at least $75,000,000;
(D) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois
Income Tax Act in a taxable year ending during calendar
year 2009, (ii) has applied for an Agreement within 150
days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 150
new jobs, (iv) retains at least 1,000 jobs in Illinois
that would have been at risk of relocation out of
Illinois over a 10-year period, and (v) makes a capital
investment of at least $57,000,000; or
(E) the Taxpayer (i) employed at least 2,500
full-time employees in the State during the year in
which the Credit is awarded, (ii) commits to make at
least $500,000,000 in combined capital improvements
and project costs under the Agreement, (iii) applies
for an Agreement between January 1, 2011 and June 30,
2011, (iv) executes an Agreement for the Credit during
calendar year 2011, and (v) was incorporated no more

SB3401 - 10 - LRB097 19857 HLH 65138 b
than 5 years before the filing of an application for an
Agreement.
(1.5) The election under this subsection (f) may also
be made by a Taxpayer for any Credit awarded pursuant to an
agreement that was executed between January 1, 2011 and
June 30, 2011, if the Taxpayer (i) is primarily engaged in
the manufacture of inner tubes or tires, or both, from
natural and synthetic rubber, (ii) employs a minimum of
2,400 full-time employees in Illinois at the time of
application, (iii) creates at least 350 full-time jobs and
retains at least 250 full-time jobs in Illinois that would
have been at risk of being created or retained outside of
Illinois, and (iv) makes a capital investment of at least
$200,000,000 at the project location.
(1.6) The election under this subsection (f) may also
be made by a Taxpayer for any Credit awarded pursuant to an
agreement that was executed within 150 days after the
effective date of this amendatory Act of the 97th General
Assembly, if the Taxpayer (i) is primarily engaged in the
operation of a discount department store, (ii) maintains
its corporate headquarters in Illinois, (iii) employs a
minimum of 4,250 full-time employees at its corporate
headquarters in Illinois at the time of application, (iv)
retains at least 4,250 full-time jobs in Illinois that
would have been at risk of being relocated outside of
Illinois, (v) had a minimum of $40,000,000,000 in total

SB3401 - 11 - LRB097 19857 HLH 65138 b
revenue in 2010, and (vi) makes a capital investment of at
least $300,000,000 at the project location.
(1.7) Notwithstanding any other provision of law, the
election under this subsection (f) may also be made by a
Taxpayer for any Credit awarded pursuant to an agreement
that was executed or applied for on or after July 1, 2011
and on or before March 31, 2012, if the Taxpayer is
primarily engaged in the manufacture of original and
aftermarket filtration parts and products for automobiles,
motor vehicles, light duty motor vehicles, light trucks and
utility vehicles, and heavy duty trucks, (ii) employs a
minimum of 1,000 full-time employees in Illinois at the
time of application, (iii) creates at least 250 full-time
jobs in Illinois, (iv) relocates its corporate
headquarters to Illinois from another state, and (v) makes
a capital investment of at least $4,000,000 at the project
location.
(1.8) On and after the effective date of this
amendatory Act of the 97th General Assembly, any Taxpayer
that is awarded a Credit under this Act may elect to claim
the Credit against its obligation to pay over withholding
under Section 704A of the Illinois Income Tax Act.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under
Section 704A of the Illinois Income Tax Act during the
first calendar year beginning after the end of the taxable

SB3401 - 12 - LRB097 19857 HLH 65138 b
year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once
made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f)
elects to claim the Credit against its withholdings as
provided in this subsection (f), then, on and after the
date of the election, the terms of the Agreement between
the Taxpayer and the Department may not be further amended
during the term of the Agreement.
(g) A pass-through entity that has been awarded a credit
under this Act, its shareholders, or its partners may treat
some or all of the credit awarded pursuant to this Act as a tax
payment for purposes of the Illinois Income Tax Act. The term
"tax payment" means a payment as described in Article 6 or
Article 8 of the Illinois Income Tax Act or a composite payment
made by a pass-through entity on behalf of any of its
shareholders or partners to satisfy such shareholders' or
partners' taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act. In no event shall
the amount of the award credited pursuant to this Act exceed
the Illinois income tax liability of the pass-through entity or
its shareholders or partners for the taxable year.
(Source: P.A. 96-834, eff. 12-14-09; 96-836, eff. 12-16-09;
96-905, eff. 6-4-10; 96-1000, eff. 7-2-10; 96-1534, eff.

SB3401 - 13 - LRB097 19857 HLH 65138 b
3-4-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12.)
Section 95. No acceleration or delay. Where this Act makes
changes in a statute that is represented in this Act by text
that is not yet or no longer in effect (for example, a Section
represented by multiple versions), the use of that text does
not accelerate or delay the taking effect of (i) the changes
made by this Act or (ii) provisions derived from any other
Public Act.
Section 99. Effective date. This Act takes effect upon
becoming law.