Bill Text: IL SB3939 | 2023-2024 | 103rd General Assembly | Introduced
Bill Title: Amends the Illinois Income Tax Act. Provides that, if a taxpayer is awarded a credit by the Department of Commerce and Economic Opportunity in connection with a qualifying Illinois data center located in a qualified area or a data center developed by a minority-owned business, a women-owned business, or a business owned a person with a disability, then the taxpayer is entitled to an additional income tax credit in an amount equal to 5% of the taxpayer's investment in qualified tangible personal property used in the construction or operation of that data center. Effective immediately.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2024-05-01 - Referred to Assignments [SB3939 Detail]
Download: Illinois-2023-SB3939-Introduced.html
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1 | AN ACT concerning revenue.
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2 | Be it enacted by the People of the State of Illinois, | |||||||||||||||||||
3 | represented in the General Assembly:
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4 | Section 5. The Illinois Income Tax Act is amended by | |||||||||||||||||||
5 | changing Section 229 as follows:
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6 | (35 ILCS 5/229) | |||||||||||||||||||
7 | Sec. 229. Data center construction employment tax credit. | |||||||||||||||||||
8 | (a) A taxpayer who has been awarded a credit by the | |||||||||||||||||||
9 | Department of Commerce and Economic Opportunity under Section | |||||||||||||||||||
10 | 605-1025 of the Department of Commerce and Economic | |||||||||||||||||||
11 | Opportunity Law of the Civil Administrative Code of Illinois | |||||||||||||||||||
12 | is entitled to a credit against the taxes imposed under | |||||||||||||||||||
13 | subsections (a) and (b) of Section 201 of this Act. The amount | |||||||||||||||||||
14 | of the credit shall be 20% of the wages paid during the taxable | |||||||||||||||||||
15 | year to a full-time or part-time employee of a construction | |||||||||||||||||||
16 | contractor employed by a certified data center if those wages | |||||||||||||||||||
17 | are paid for the construction of a new data center in a | |||||||||||||||||||
18 | geographic area that meets any one of the following criteria: | |||||||||||||||||||
19 | (1) the area has a poverty rate of at least 20%, | |||||||||||||||||||
20 | according to the U.S. Census Bureau American Community | |||||||||||||||||||
21 | Survey 5-Year Estimates; | |||||||||||||||||||
22 | (2) 75% or more of the children in the area | |||||||||||||||||||
23 | participate in the federal free lunch program, according |
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1 | to reported statistics from the State Board of Education; | ||||||
2 | (3) 20% or more of the households in the area receive | ||||||
3 | assistance under the Supplemental Nutrition Assistance | ||||||
4 | Program (SNAP), according to data from the U.S. Census | ||||||
5 | Bureau American Community Survey 5-year Estimates; or | ||||||
6 | (4) the area has an average unemployment rate, as | ||||||
7 | determined by the Department of Employment Security, that | ||||||
8 | is more than 120% of the national unemployment average, as | ||||||
9 | determined by the U.S. Department of Labor, for a period | ||||||
10 | of at least 2 consecutive calendar years preceding the | ||||||
11 | date of the application. | ||||||
12 | (a-5) For taxable years beginning on or after January 1, | ||||||
13 | 2025, if the taxpayer is awarded a credit under Section | ||||||
14 | 605-1025 of the Department of Commerce and Economic | ||||||
15 | Opportunity Law of the Civil Administrative Code of Illinois | ||||||
16 | in connection with a qualifying Illinois data center located | ||||||
17 | in a qualified area or a data center developed by a qualified | ||||||
18 | business enterprise, then the taxpayer is entitled to an | ||||||
19 | additional credit against the tax imposed by subsections (a) | ||||||
20 | and (b) of Section 201 in an amount equal to 5% of the | ||||||
21 | taxpayer's investment in qualified tangible personal property | ||||||
22 | used in the construction or operation of that data center. The | ||||||
23 | credit shall be available for a period of 5 taxable years after | ||||||
24 | the property is placed in service. The taxpayer may transfer | ||||||
25 | the credit in accordance with rules adopted by the Department | ||||||
26 | of Commerce and Economic Opportunity. |
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1 | (a-10) For taxable years ending before December 31, 2023, | ||||||
2 | if the taxpayer is a partnership, a Subchapter S corporation, | ||||||
3 | or a limited liability company that has elected partnership | ||||||
4 | tax treatment, the credit shall be allowed to the partners, | ||||||
5 | shareholders, or members in accordance with the determination | ||||||
6 | of income and distributive share of income under Sections 702 | ||||||
7 | and 704 and subchapter S of the Internal Revenue Code, as | ||||||
8 | applicable. For taxable years ending on or after December 31, | ||||||
9 | 2023, if the taxpayer is a partnership or a Subchapter S | ||||||
10 | corporation, then the provisions of Section 251 apply. The | ||||||
11 | Department, in cooperation with the Department of Commerce and | ||||||
12 | Economic Opportunity, shall adopt rules to enforce and | ||||||
13 | administer this Section. This Section is exempt from the | ||||||
14 | provisions of Section 250 of this Act. | ||||||
15 | (b) In no event shall a credit under this Section reduce | ||||||
16 | the taxpayer's liability to less than zero. If the amount of | ||||||
17 | the credit exceeds the tax liability for the year, the excess | ||||||
18 | may be carried forward and applied to the tax liability of the | ||||||
19 | 5 taxable years following the excess credit year. The tax | ||||||
20 | credit shall be applied to the earliest year for which there is | ||||||
21 | a tax liability. If there are credits for more than one year | ||||||
22 | that are available to offset a liability, the earlier credit | ||||||
23 | shall be applied first. | ||||||
24 | (c) No credit shall be allowed with respect to any | ||||||
25 | certification for any taxable year ending after the revocation | ||||||
26 | of the certification by the Department of Commerce and |
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1 | Economic Opportunity. Upon receiving notification by the | ||||||
2 | Department of Commerce and Economic Opportunity of the | ||||||
3 | revocation of certification, the Department shall notify the | ||||||
4 | taxpayer that no credit is allowed for any taxable year ending | ||||||
5 | after the revocation date, as stated in such notification. If | ||||||
6 | any credit has been allowed with respect to a certification | ||||||
7 | for a taxable year ending after the revocation date, any | ||||||
8 | refund paid to the taxpayer for that taxable year shall, to the | ||||||
9 | extent of that credit allowed, be an erroneous refund within | ||||||
10 | the meaning of Section 912 of this Act. | ||||||
11 | (d) As used in this Section: | ||||||
12 | "Qualified area" means an opportunity zone, an area | ||||||
13 | designated as an R3 community pursuant to the Cannabis | ||||||
14 | Regulation and Tax Act, or a community designated as a | ||||||
15 | Disproportionately Impacted Area that is eligible for | ||||||
16 | participation in the Illinois Adult-Use Cannabis Social Equity | ||||||
17 | Program administered by the Department of Commerce and | ||||||
18 | Economic Opportunity. | ||||||
19 | "Qualified business enterprise" means a minority-owned | ||||||
20 | business, a women-owned business, or a business owned a person | ||||||
21 | with a disability, as those terms are defined in the Business | ||||||
22 | Enterprise for Minorities, Women, and Persons with | ||||||
23 | Disabilities Act. | ||||||
24 | "Qualified tangible personal property" has the meaning | ||||||
25 | given to that term in Section 605-1025 of the Department of | ||||||
26 | Commerce and Economic Opportunity Law of the Civil |
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1 | Administrative Code of Illinois. | ||||||
2 | (e) This Section is exempt from the provisions of Section | ||||||
3 | 250. | ||||||
4 | (Source: P.A. 102-558, eff. 8-20-21; 103-396, eff. 1-1-24 .)
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