Illinois 2023-2024 Regular Session

Illinois House Bill HB1241 Compare Versions

Only one version of the bill is available at this time.

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1	1	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB1241 Introduced , by Rep. Margaret Croke SYNOPSIS AS INTRODUCED: New Act35 ILCS 5/203 from Ch. 120, par. 2-20335 ILCS 5/234 new Creates the Endow Illinois Tax Credit Act. Provides that the Department of Revenue shall award income tax credits to taxpayers who provide an endowment gift to a permanent endowment fund during the taxable year and receive a certificate of receipt for that gift. Provides that the credit is equal to 25% of the endowment gift. Contains provisions setting forth maximum credit amounts. Amends the Illinois Income Tax Act to require an addition modification equal to the amount of any federal deduction claimed for an endowment gift for which a taxpayer receives a credit under the Endow Illinois Tax Credit Act. Makes conforming changes. Effective immediately. LRB103 25002 HLH 51336 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB1241 Introduced , by Rep. Margaret Croke SYNOPSIS AS INTRODUCED: New Act35 ILCS 5/203 from Ch. 120, par. 2-20335 ILCS 5/234 new New Act 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/234 new Creates the Endow Illinois Tax Credit Act. Provides that the Department of Revenue shall award income tax credits to taxpayers who provide an endowment gift to a permanent endowment fund during the taxable year and receive a certificate of receipt for that gift. Provides that the credit is equal to 25% of the endowment gift. Contains provisions setting forth maximum credit amounts. Amends the Illinois Income Tax Act to require an addition modification equal to the amount of any federal deduction claimed for an endowment gift for which a taxpayer receives a credit under the Endow Illinois Tax Credit Act. Makes conforming changes. Effective immediately. LRB103 25002 HLH 51336 b LRB103 25002 HLH 51336 b A BILL FOR
2	2	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB1241 Introduced , by Rep. Margaret Croke SYNOPSIS AS INTRODUCED:
3	3	New Act35 ILCS 5/203 from Ch. 120, par. 2-20335 ILCS 5/234 new New Act 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/234 new
4	4	New Act
5	5	35 ILCS 5/203 from Ch. 120, par. 2-203
6	6	35 ILCS 5/234 new
7	7	Creates the Endow Illinois Tax Credit Act. Provides that the Department of Revenue shall award income tax credits to taxpayers who provide an endowment gift to a permanent endowment fund during the taxable year and receive a certificate of receipt for that gift. Provides that the credit is equal to 25% of the endowment gift. Contains provisions setting forth maximum credit amounts. Amends the Illinois Income Tax Act to require an addition modification equal to the amount of any federal deduction claimed for an endowment gift for which a taxpayer receives a credit under the Endow Illinois Tax Credit Act. Makes conforming changes. Effective immediately.
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10	10	A BILL FOR
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13	13	1 AN ACT concerning revenue.
14	14	2 Be it enacted by the People of the State of Illinois,
15	15	3 represented in the General Assembly:
16	16	4 Section 1. Short title. This Act may be cited as the Endow
17	17	5 Illinois Tax Credit Act.
18	18	6 Section 5. Definitions. As used in this Act:
19	19	7 "Business entity" means a corporation (including a
20	20	8 Subchapter S corporation), trust, estate, partnership, limited
21	21	9 liability company, or sole proprietorship.
22	22	10 "Consumer Price Index" means the index published by the
23	23	11 Bureau of Labor Statistics of the United States Department of
24	24	12 Labor that measures the average change in prices of goods and
25	25	13 services purchased by all urban consumers, United States city
26	26	14 average, all items, 1982-84 = 100.
27	27	15 "Credit-eligible endowment gift" means an endowment gift
28	28	16 for which a taxpayer intends to apply for an income tax credit
29	29	17 under this Act.
30	30	18 "Department" means the Department of Revenue.
31	31	19 "Donor advised fund" has the meaning given to that term in
32	32	20 subsection (d) of Section 4966 of the Internal Revenue Code of
33	33	21 1986.
34	34	22 "Endowment gift" means an irrevocable contribution to a
35	35	23 permanent endowment fund held by a qualified community
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39	39	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB1241 Introduced , by Rep. Margaret Croke SYNOPSIS AS INTRODUCED:
40	40	New Act35 ILCS 5/203 from Ch. 120, par. 2-20335 ILCS 5/234 new New Act 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/234 new
41	41	New Act
42	42	35 ILCS 5/203 from Ch. 120, par. 2-203
43	43	35 ILCS 5/234 new
44	44	Creates the Endow Illinois Tax Credit Act. Provides that the Department of Revenue shall award income tax credits to taxpayers who provide an endowment gift to a permanent endowment fund during the taxable year and receive a certificate of receipt for that gift. Provides that the credit is equal to 25% of the endowment gift. Contains provisions setting forth maximum credit amounts. Amends the Illinois Income Tax Act to require an addition modification equal to the amount of any federal deduction claimed for an endowment gift for which a taxpayer receives a credit under the Endow Illinois Tax Credit Act. Makes conforming changes. Effective immediately.
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46	46	LRB103 25002 HLH 51336 b
47	47	A BILL FOR
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53	53	New Act
54	54	35 ILCS 5/203 from Ch. 120, par. 2-203
55	55	35 ILCS 5/234 new
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74	74	1 foundation.
75	75	2 "Permanent endowment fund" means a fund that (i) is held
76	76	3 by a qualified community foundation, (ii) provides charitable
77	77	4 grants exclusively for the benefit of residents of the State
78	78	5 or charities and charitable projects located in the State,
79	79	6 (iii) is intended to exist in perpetuity, (iv) has an annual
80	80	7 spending rate based on the foundation spending policy, but not
81	81	8 to exceed 7%, and (v) is not a donor advised fund.
82	82	9 "Qualified community foundation" means a community
83	83	10 foundation or similar publicly supported organization
84	84	11 described in Section 170 (b)(1)(A)(vi) of the Internal Revenue
85	85	12 Code of 1986 that is organized or operating in this State and
86	86	13 that substantially complies with the national standards for
87	87	14 U.S. community foundations established by the National Council
88	88	15 on Foundations, as determined by the Department.
89	89	16 "Taxpayer" means any individual who is subject to the tax
90	90	17 imposed under subsections (a) and (b) of Section 201 of the
91	91	18 Illinois Income Tax Act or any business entity that is subject
92	92	19 to the tax imposed under subsections (a) and (b) of Section 201
93	93	20 of the Illinois Income Tax Act.
94	94	21 Section 10. Tax credit awards; limitations.
95	95	22 (a) For taxable years ending on or after December 31, 2024
96	96	23 and ending before January 1, 2034, the Department shall award,
97	97	24 in accordance with this Act, income tax credits to taxpayers
98	98	25 who provide an endowment gift to a permanent endowment fund
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109	109	1 during the taxable year and receive a certificate of receipt
110	110	2 under Section 15 for that gift. Subject to the limitations in
111	111	3 this Section, the amount of the credit that may be awarded to a
112	112	4 taxpayer by the Department under this Act is an amount equal to
113	113	5 25% of the endowment gift.
114	114	6 (b) The aggregate amount of all Endow Illinois tax credits
115	115	7 awarded by the Department under this Act in calendar year 2024
116	116	8 may not exceed $50,000,000. In calendar year 2025 and each
117	117	9 calendar year thereafter, the aggregate amount of all Endow
118	118	10 Illinois tax credits awarded by the Department under this Act
119	119	11 may not exceed the maximum aggregate credit amount authorized
120	120	12 under this subsection for the immediately preceding calendar
121	121	13 year, multiplied by the sum of one plus the percentage
122	122	14 increase, if any, in the Consumer Price Index during the
123	123	15 12-month period ending in September of that preceding calendar
124	124	16 year and rounded to the nearest $25,000.
125	125	17 (c) The aggregate amount of all Endow Illinois tax credits
126	126	18 that the Department may award to any taxpayer under this Act in
127	127	19 calendar year 2024 may not exceed $100,000. In calendar year
128	128	20 2025 and each calendar year thereafter, the aggregate amount
129	129	21 of all Endow Illinois credits that the Department may award to
130	130	22 any taxpayer under this Act may not exceed the maximum credit
131	131	23 amount authorized under this subsection for any taxpayer in
132	132	24 the immediately preceding calendar year, multiplied by the sum
133	133	25 of one plus the percentage increase, if any, in the Consumer
134	134	26 Price Index during the 12-month period ending in September of
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145	145	1 that preceding calendar year and rounded to the nearest
146	146	2 $1,000.
147	147	3 (d) The aggregate amount of all credits that the
148	148	4 Department may authorize in any calendar year based on
149	149	5 endowment gifts to any specific community foundation may not
150	150	6 exceed 15% of the aggregate amount of all Endow Illinois tax
151	151	7 credits authorized by the Department under this Act in that
152	152	8 calendar year.
153	153	9 (e) Of the annual amount available for tax credits, 10%
154	154	10 must be reserved for endowment gifts that do not exceed the
155	155	11 small gift maximum set forth in this subsection. For the
156	156	12 calendar year ending on December 31, 2024, the small gift
157	157	13 maximum is $30,000. For subsequent calendar years, the small
158	158	14 gift maximum is the small gift maximum for the immediately
159	159	15 preceding calendar year, multiplied by the sum of one plus the
160	160	16 percentage increase, if any, in the Consumer Price Index
161	161	17 during the 12-month period ending in September of that
162	162	18 immediately preceding calendar year and rounded to the nearest
163	163	19 $100.
164	164	20 (f) For the purpose of this Section, a credit is
165	165	21 considered to be awarded on the date the Department issues an
166	166	22 approved contribution authorization certificate under Section
167	167	23 15.
168	168	24 Section 15. Applications for tax credits.
169	169	25 (a) The taxpayer shall apply to the Department, in the
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180	180	1 form and manner prescribed by the Department, for a
181	181	2 contribution authorization certificate. A taxpayer who makes
182	182	3 more than one credit-eligible endowment gift must make a
183	183	4 separate application for each contribution authorization
184	184	5 certificate. Applications under this subsection shall be
185	185	6 reviewed by the Department and shall either be approved or
186	186	7 denied. Each approved contribution authorization certificate
187	187	8 shall be sent to the taxpayer within 3 business days after the
188	188	9 certificate is approved. The Department shall maintain on its
189	189	10 website a running total of: (i) the total amount of credits
190	190	11 remaining under this Act for which taxpayers may apply for a
191	191	12 contribution authorization certificate issued in the calendar
192	192	13 year; (ii) the total amount of credits allocated during the
193	193	14 calendar year for each specific community foundation; and
194	194	15 (iii) the total amount remaining for the calendar year under
195	195	16 the small gift maximum set forth in Section 10. Those running
196	196	17 totals shall be updated every business day.
197	197	18 (b) The taxpayer shall make the endowment gift to the
198	198	19 permanent endowment fund either prior to or within 60 days
199	199	20 after the taxpayer receives the approved contribution
200	200	21 authorization certificate under subsection (a). The qualified
201	201	22 community foundation shall, within 30 days after receipt of an
202	202	23 endowment gift for which a contribution authorization
203	203	24 certificate has been approved by the Department under
204	204	25 subsection (a), issue to the taxpayer a written certificate of
205	205	26 receipt, which shall contain the information required by the
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216	216	1 Department by rule. No receipt shall be issued for amounts
217	217	2 that are not actually received by the qualified community
218	218	3 foundation within 60 days after the taxpayer receives the
219	219	4 approved contribution authorization certificate.
220	220	5 Section 20. Annual report. By March 31, 2025, and by March
221	221	6 31 of each subsequent year, the Department must submit an
222	222	7 annual report to the Governor and the General Assembly
223	223	8 concerning the activities conducted under this Act during the
224	224	9 previous calendar year. The report must include a detailed
225	225	10 listing of tax credits authorized under this Act by the
226	226	11 Department. The report may not disclose any information if the
227	227	12 disclosure would violate Section 917 of the Illinois Income
228	228	13 Tax Act.
229	229	14 Section 25. Rulemaking. The Department may adopt rules for
230	230	15 the implementation of this Act.
231	231	16 Section 900. The Illinois Income Tax Act is amended by
232	232	17 changing Section 203 and by adding Section 234 as follows:
233	233	18 (35 ILCS 5/203) (from Ch. 120, par. 2-203)
234	234	19 Sec. 203. Base income defined.
235	235	20 (a) Individuals.
236	236	21 (1) In general. In the case of an individual, base
237	237	22 income means an amount equal to the taxpayer's adjusted
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248	248	1 gross income for the taxable year as modified by paragraph
249	249	2 (2).
250	250	3 (2) Modifications. The adjusted gross income referred
251	251	4 to in paragraph (1) shall be modified by adding thereto
252	252	5 the sum of the following amounts:
253	253	6 (A) An amount equal to all amounts paid or accrued
254	254	7 to the taxpayer as interest or dividends during the
255	255	8 taxable year to the extent excluded from gross income
256	256	9 in the computation of adjusted gross income, except
257	257	10 stock dividends of qualified public utilities
258	258	11 described in Section 305(e) of the Internal Revenue
259	259	12 Code;
260	260	13 (B) An amount equal to the amount of tax imposed by
261	261	14 this Act to the extent deducted from gross income in
262	262	15 the computation of adjusted gross income for the
263	263	16 taxable year;
264	264	17 (C) An amount equal to the amount received during
265	265	18 the taxable year as a recovery or refund of real
266	266	19 property taxes paid with respect to the taxpayer's
267	267	20 principal residence under the Revenue Act of 1939 and
268	268	21 for which a deduction was previously taken under
269	269	22 subparagraph (L) of this paragraph (2) prior to July
270	270	23 1, 1991, the retrospective application date of Article
271	271	24 4 of Public Act 87-17. In the case of multi-unit or
272	272	25 multi-use structures and farm dwellings, the taxes on
273	273	26 the taxpayer's principal residence shall be that
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284	284	1 portion of the total taxes for the entire property
285	285	2 which is attributable to such principal residence;
286	286	3 (D) An amount equal to the amount of the capital
287	287	4 gain deduction allowable under the Internal Revenue
288	288	5 Code, to the extent deducted from gross income in the
289	289	6 computation of adjusted gross income;
290	290	7 (D-5) An amount, to the extent not included in
291	291	8 adjusted gross income, equal to the amount of money
292	292	9 withdrawn by the taxpayer in the taxable year from a
293	293	10 medical care savings account and the interest earned
294	294	11 on the account in the taxable year of a withdrawal
295	295	12 pursuant to subsection (b) of Section 20 of the
296	296	13 Medical Care Savings Account Act or subsection (b) of
297	297	14 Section 20 of the Medical Care Savings Account Act of
298	298	15 2000;
299	299	16 (D-10) For taxable years ending after December 31,
300	300	17 1997, an amount equal to any eligible remediation
301	301	18 costs that the individual deducted in computing
302	302	19 adjusted gross income and for which the individual
303	303	20 claims a credit under subsection (l) of Section 201;
304	304	21 (D-15) For taxable years 2001 and thereafter, an
305	305	22 amount equal to the bonus depreciation deduction taken
306	306	23 on the taxpayer's federal income tax return for the
307	307	24 taxable year under subsection (k) of Section 168 of
308	308	25 the Internal Revenue Code;
309	309	26 (D-16) If the taxpayer sells, transfers, abandons,
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320	320	1 or otherwise disposes of property for which the
321	321	2 taxpayer was required in any taxable year to make an
322	322	3 addition modification under subparagraph (D-15), then
323	323	4 an amount equal to the aggregate amount of the
324	324	5 deductions taken in all taxable years under
325	325	6 subparagraph (Z) with respect to that property.
326	326	7 If the taxpayer continues to own property through
327	327	8 the last day of the last tax year for which a
328	328	9 subtraction is allowed with respect to that property
329	329	10 under subparagraph (Z) and for which the taxpayer was
330	330	11 allowed in any taxable year to make a subtraction
331	331	12 modification under subparagraph (Z), then an amount
332	332	13 equal to that subtraction modification.
333	333	14 The taxpayer is required to make the addition
334	334	15 modification under this subparagraph only once with
335	335	16 respect to any one piece of property;
336	336	17 (D-17) An amount equal to the amount otherwise
337	337	18 allowed as a deduction in computing base income for
338	338	19 interest paid, accrued, or incurred, directly or
339	339	20 indirectly, (i) for taxable years ending on or after
340	340	21 December 31, 2004, to a foreign person who would be a
341	341	22 member of the same unitary business group but for the
342	342	23 fact that foreign person's business activity outside
343	343	24 the United States is 80% or more of the foreign
344	344	25 person's total business activity and (ii) for taxable
345	345	26 years ending on or after December 31, 2008, to a person
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356	356	1 who would be a member of the same unitary business
357	357	2 group but for the fact that the person is prohibited
358	358	3 under Section 1501(a)(27) from being included in the
359	359	4 unitary business group because he or she is ordinarily
360	360	5 required to apportion business income under different
361	361	6 subsections of Section 304. The addition modification
362	362	7 required by this subparagraph shall be reduced to the
363	363	8 extent that dividends were included in base income of
364	364	9 the unitary group for the same taxable year and
365	365	10 received by the taxpayer or by a member of the
366	366	11 taxpayer's unitary business group (including amounts
367	367	12 included in gross income under Sections 951 through
368	368	13 964 of the Internal Revenue Code and amounts included
369	369	14 in gross income under Section 78 of the Internal
370	370	15 Revenue Code) with respect to the stock of the same
371	371	16 person to whom the interest was paid, accrued, or
372	372	17 incurred.
373	373	18 This paragraph shall not apply to the following:
374	374	19 (i) an item of interest paid, accrued, or
375	375	20 incurred, directly or indirectly, to a person who
376	376	21 is subject in a foreign country or state, other
377	377	22 than a state which requires mandatory unitary
378	378	23 reporting, to a tax on or measured by net income
379	379	24 with respect to such interest; or
380	380	25 (ii) an item of interest paid, accrued, or
381	381	26 incurred, directly or indirectly, to a person if
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392	392	1 the taxpayer can establish, based on a
393	393	2 preponderance of the evidence, both of the
394	394	3 following:
395	395	4 (a) the person, during the same taxable
396	396	5 year, paid, accrued, or incurred, the interest
397	397	6 to a person that is not a related member, and
398	398	7 (b) the transaction giving rise to the
399	399	8 interest expense between the taxpayer and the
400	400	9 person did not have as a principal purpose the
401	401	10 avoidance of Illinois income tax, and is paid
402	402	11 pursuant to a contract or agreement that
403	403	12 reflects an arm's-length interest rate and
404	404	13 terms; or
405	405	14 (iii) the taxpayer can establish, based on
406	406	15 clear and convincing evidence, that the interest
407	407	16 paid, accrued, or incurred relates to a contract
408	408	17 or agreement entered into at arm's-length rates
409	409	18 and terms and the principal purpose for the
410	410	19 payment is not federal or Illinois tax avoidance;
411	411	20 or
412	412	21 (iv) an item of interest paid, accrued, or
413	413	22 incurred, directly or indirectly, to a person if
414	414	23 the taxpayer establishes by clear and convincing
415	415	24 evidence that the adjustments are unreasonable; or
416	416	25 if the taxpayer and the Director agree in writing
417	417	26 to the application or use of an alternative method
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428	428	1 of apportionment under Section 304(f).
429	429	2 Nothing in this subsection shall preclude the
430	430	3 Director from making any other adjustment
431	431	4 otherwise allowed under Section 404 of this Act
432	432	5 for any tax year beginning after the effective
433	433	6 date of this amendment provided such adjustment is
434	434	7 made pursuant to regulation adopted by the
435	435	8 Department and such regulations provide methods
436	436	9 and standards by which the Department will utilize
437	437	10 its authority under Section 404 of this Act;
438	438	11 (D-18) An amount equal to the amount of intangible
439	439	12 expenses and costs otherwise allowed as a deduction in
440	440	13 computing base income, and that were paid, accrued, or
441	441	14 incurred, directly or indirectly, (i) for taxable
442	442	15 years ending on or after December 31, 2004, to a
443	443	16 foreign person who would be a member of the same
444	444	17 unitary business group but for the fact that the
445	445	18 foreign person's business activity outside the United
446	446	19 States is 80% or more of that person's total business
447	447	20 activity and (ii) for taxable years ending on or after
448	448	21 December 31, 2008, to a person who would be a member of
449	449	22 the same unitary business group but for the fact that
450	450	23 the person is prohibited under Section 1501(a)(27)
451	451	24 from being included in the unitary business group
452	452	25 because he or she is ordinarily required to apportion
453	453	26 business income under different subsections of Section
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464	464	1 304. The addition modification required by this
465	465	2 subparagraph shall be reduced to the extent that
466	466	3 dividends were included in base income of the unitary
467	467	4 group for the same taxable year and received by the
468	468	5 taxpayer or by a member of the taxpayer's unitary
469	469	6 business group (including amounts included in gross
470	470	7 income under Sections 951 through 964 of the Internal
471	471	8 Revenue Code and amounts included in gross income
472	472	9 under Section 78 of the Internal Revenue Code) with
473	473	10 respect to the stock of the same person to whom the
474	474	11 intangible expenses and costs were directly or
475	475	12 indirectly paid, incurred, or accrued. The preceding
476	476	13 sentence does not apply to the extent that the same
477	477	14 dividends caused a reduction to the addition
478	478	15 modification required under Section 203(a)(2)(D-17) of
479	479	16 this Act. As used in this subparagraph, the term
480	480	17 "intangible expenses and costs" includes (1) expenses,
481	481	18 losses, and costs for, or related to, the direct or
482	482	19 indirect acquisition, use, maintenance or management,
483	483	20 ownership, sale, exchange, or any other disposition of
484	484	21 intangible property; (2) losses incurred, directly or
485	485	22 indirectly, from factoring transactions or discounting
486	486	23 transactions; (3) royalty, patent, technical, and
487	487	24 copyright fees; (4) licensing fees; and (5) other
488	488	25 similar expenses and costs. For purposes of this
489	489	26 subparagraph, "intangible property" includes patents,
490	490
491	491
492	492
493	493
494	494
495	495	HB1241 - 13 - LRB103 25002 HLH 51336 b
496	496
497	497
498	498	HB1241- 14 -LRB103 25002 HLH 51336 b HB1241 - 14 - LRB103 25002 HLH 51336 b
499	499	HB1241 - 14 - LRB103 25002 HLH 51336 b
500	500	1 patent applications, trade names, trademarks, service
501	501	2 marks, copyrights, mask works, trade secrets, and
502	502	3 similar types of intangible assets.
503	503	4 This paragraph shall not apply to the following:
504	504	5 (i) any item of intangible expenses or costs
505	505	6 paid, accrued, or incurred, directly or
506	506	7 indirectly, from a transaction with a person who
507	507	8 is subject in a foreign country or state, other
508	508	9 than a state which requires mandatory unitary
509	509	10 reporting, to a tax on or measured by net income
510	510	11 with respect to such item; or
511	511	12 (ii) any item of intangible expense or cost
512	512	13 paid, accrued, or incurred, directly or
513	513	14 indirectly, if the taxpayer can establish, based
514	514	15 on a preponderance of the evidence, both of the
515	515	16 following:
516	516	17 (a) the person during the same taxable
517	517	18 year paid, accrued, or incurred, the
518	518	19 intangible expense or cost to a person that is
519	519	20 not a related member, and
520	520	21 (b) the transaction giving rise to the
521	521	22 intangible expense or cost between the
522	522	23 taxpayer and the person did not have as a
523	523	24 principal purpose the avoidance of Illinois
524	524	25 income tax, and is paid pursuant to a contract
525	525	26 or agreement that reflects arm's-length terms;
526	526
527	527
528	528
529	529
530	530
531	531	HB1241 - 14 - LRB103 25002 HLH 51336 b
532	532
533	533
534	534	HB1241- 15 -LRB103 25002 HLH 51336 b HB1241 - 15 - LRB103 25002 HLH 51336 b
535	535	HB1241 - 15 - LRB103 25002 HLH 51336 b
536	536	1 or
537	537	2 (iii) any item of intangible expense or cost
538	538	3 paid, accrued, or incurred, directly or
539	539	4 indirectly, from a transaction with a person if
540	540	5 the taxpayer establishes by clear and convincing
541	541	6 evidence, that the adjustments are unreasonable;
542	542	7 or if the taxpayer and the Director agree in
543	543	8 writing to the application or use of an
544	544	9 alternative method of apportionment under Section
545	545	10 304(f);
546	546	11 Nothing in this subsection shall preclude the
547	547	12 Director from making any other adjustment
548	548	13 otherwise allowed under Section 404 of this Act
549	549	14 for any tax year beginning after the effective
550	550	15 date of this amendment provided such adjustment is
551	551	16 made pursuant to regulation adopted by the
552	552	17 Department and such regulations provide methods
553	553	18 and standards by which the Department will utilize
554	554	19 its authority under Section 404 of this Act;
555	555	20 (D-19) For taxable years ending on or after
556	556	21 December 31, 2008, an amount equal to the amount of
557	557	22 insurance premium expenses and costs otherwise allowed
558	558	23 as a deduction in computing base income, and that were
559	559	24 paid, accrued, or incurred, directly or indirectly, to
560	560	25 a person who would be a member of the same unitary
561	561	26 business group but for the fact that the person is
562	562
563	563
564	564
565	565
566	566
567	567	HB1241 - 15 - LRB103 25002 HLH 51336 b
568	568
569	569
570	570	HB1241- 16 -LRB103 25002 HLH 51336 b HB1241 - 16 - LRB103 25002 HLH 51336 b
571	571	HB1241 - 16 - LRB103 25002 HLH 51336 b
572	572	1 prohibited under Section 1501(a)(27) from being
573	573	2 included in the unitary business group because he or
574	574	3 she is ordinarily required to apportion business
575	575	4 income under different subsections of Section 304. The
576	576	5 addition modification required by this subparagraph
577	577	6 shall be reduced to the extent that dividends were
578	578	7 included in base income of the unitary group for the
579	579	8 same taxable year and received by the taxpayer or by a
580	580	9 member of the taxpayer's unitary business group
581	581	10 (including amounts included in gross income under
582	582	11 Sections 951 through 964 of the Internal Revenue Code
583	583	12 and amounts included in gross income under Section 78
584	584	13 of the Internal Revenue Code) with respect to the
585	585	14 stock of the same person to whom the premiums and costs
586	586	15 were directly or indirectly paid, incurred, or
587	587	16 accrued. The preceding sentence does not apply to the
588	588	17 extent that the same dividends caused a reduction to
589	589	18 the addition modification required under Section
590	590	19 203(a)(2)(D-17) or Section 203(a)(2)(D-18) of this
591	591	20 Act;
592	592	21 (D-20) For taxable years beginning on or after
593	593	22 January 1, 2002 and ending on or before December 31,
594	594	23 2006, in the case of a distribution from a qualified
595	595	24 tuition program under Section 529 of the Internal
596	596	25 Revenue Code, other than (i) a distribution from a
597	597	26 College Savings Pool created under Section 16.5 of the
598	598
599	599
600	600
601	601
602	602
603	603	HB1241 - 16 - LRB103 25002 HLH 51336 b
604	604
605	605
606	606	HB1241- 17 -LRB103 25002 HLH 51336 b HB1241 - 17 - LRB103 25002 HLH 51336 b
607	607	HB1241 - 17 - LRB103 25002 HLH 51336 b
608	608	1 State Treasurer Act or (ii) a distribution from the
609	609	2 Illinois Prepaid Tuition Trust Fund, an amount equal
610	610	3 to the amount excluded from gross income under Section
611	611	4 529(c)(3)(B). For taxable years beginning on or after
612	612	5 January 1, 2007, in the case of a distribution from a
613	613	6 qualified tuition program under Section 529 of the
614	614	7 Internal Revenue Code, other than (i) a distribution
615	615	8 from a College Savings Pool created under Section 16.5
616	616	9 of the State Treasurer Act, (ii) a distribution from
617	617	10 the Illinois Prepaid Tuition Trust Fund, or (iii) a
618	618	11 distribution from a qualified tuition program under
619	619	12 Section 529 of the Internal Revenue Code that (I)
620	620	13 adopts and determines that its offering materials
621	621	14 comply with the College Savings Plans Network's
622	622	15 disclosure principles and (II) has made reasonable
623	623	16 efforts to inform in-state residents of the existence
624	624	17 of in-state qualified tuition programs by informing
625	625	18 Illinois residents directly and, where applicable, to
626	626	19 inform financial intermediaries distributing the
627	627	20 program to inform in-state residents of the existence
628	628	21 of in-state qualified tuition programs at least
629	629	22 annually, an amount equal to the amount excluded from
630	630	23 gross income under Section 529(c)(3)(B).
631	631	24 For the purposes of this subparagraph (D-20), a
632	632	25 qualified tuition program has made reasonable efforts
633	633	26 if it makes disclosures (which may use the term
634	634
635	635
636	636
637	637
638	638
639	639	HB1241 - 17 - LRB103 25002 HLH 51336 b
640	640
641	641
642	642	HB1241- 18 -LRB103 25002 HLH 51336 b HB1241 - 18 - LRB103 25002 HLH 51336 b
643	643	HB1241 - 18 - LRB103 25002 HLH 51336 b
644	644	1 "in-state program" or "in-state plan" and need not
645	645	2 specifically refer to Illinois or its qualified
646	646	3 programs by name) (i) directly to prospective
647	647	4 participants in its offering materials or makes a
648	648	5 public disclosure, such as a website posting; and (ii)
649	649	6 where applicable, to intermediaries selling the
650	650	7 out-of-state program in the same manner that the
651	651	8 out-of-state program distributes its offering
652	652	9 materials;
653	653	10 (D-20.5) For taxable years beginning on or after
654	654	11 January 1, 2018, in the case of a distribution from a
655	655	12 qualified ABLE program under Section 529A of the
656	656	13 Internal Revenue Code, other than a distribution from
657	657	14 a qualified ABLE program created under Section 16.6 of
658	658	15 the State Treasurer Act, an amount equal to the amount
659	659	16 excluded from gross income under Section 529A(c)(1)(B)
660	660	17 of the Internal Revenue Code;
661	661	18 (D-21) For taxable years beginning on or after
662	662	19 January 1, 2007, in the case of transfer of moneys from
663	663	20 a qualified tuition program under Section 529 of the
664	664	21 Internal Revenue Code that is administered by the
665	665	22 State to an out-of-state program, an amount equal to
666	666	23 the amount of moneys previously deducted from base
667	667	24 income under subsection (a)(2)(Y) of this Section;
668	668	25 (D-21.5) For taxable years beginning on or after
669	669	26 January 1, 2018, in the case of the transfer of moneys
670	670
671	671
672	672
673	673
674	674
675	675	HB1241 - 18 - LRB103 25002 HLH 51336 b
676	676
677	677
678	678	HB1241- 19 -LRB103 25002 HLH 51336 b HB1241 - 19 - LRB103 25002 HLH 51336 b
679	679	HB1241 - 19 - LRB103 25002 HLH 51336 b
680	680	1 from a qualified tuition program under Section 529 or
681	681	2 a qualified ABLE program under Section 529A of the
682	682	3 Internal Revenue Code that is administered by this
683	683	4 State to an ABLE account established under an
684	684	5 out-of-state ABLE account program, an amount equal to
685	685	6 the contribution component of the transferred amount
686	686	7 that was previously deducted from base income under
687	687	8 subsection (a)(2)(Y) or subsection (a)(2)(HH) of this
688	688	9 Section;
689	689	10 (D-22) For taxable years beginning on or after
690	690	11 January 1, 2009, and prior to January 1, 2018, in the
691	691	12 case of a nonqualified withdrawal or refund of moneys
692	692	13 from a qualified tuition program under Section 529 of
693	693	14 the Internal Revenue Code administered by the State
694	694	15 that is not used for qualified expenses at an eligible
695	695	16 education institution, an amount equal to the
696	696	17 contribution component of the nonqualified withdrawal
697	697	18 or refund that was previously deducted from base
698	698	19 income under subsection (a)(2)(y) of this Section,
699	699	20 provided that the withdrawal or refund did not result
700	700	21 from the beneficiary's death or disability. For
701	701	22 taxable years beginning on or after January 1, 2018:
702	702	23 (1) in the case of a nonqualified withdrawal or
703	703	24 refund, as defined under Section 16.5 of the State
704	704	25 Treasurer Act, of moneys from a qualified tuition
705	705	26 program under Section 529 of the Internal Revenue Code
706	706
707	707
708	708
709	709
710	710
711	711	HB1241 - 19 - LRB103 25002 HLH 51336 b
712	712
713	713
714	714	HB1241- 20 -LRB103 25002 HLH 51336 b HB1241 - 20 - LRB103 25002 HLH 51336 b
715	715	HB1241 - 20 - LRB103 25002 HLH 51336 b
716	716	1 administered by the State, an amount equal to the
717	717	2 contribution component of the nonqualified withdrawal
718	718	3 or refund that was previously deducted from base
719	719	4 income under subsection (a)(2)(Y) of this Section, and
720	720	5 (2) in the case of a nonqualified withdrawal or refund
721	721	6 from a qualified ABLE program under Section 529A of
722	722	7 the Internal Revenue Code administered by the State
723	723	8 that is not used for qualified disability expenses, an
724	724	9 amount equal to the contribution component of the
725	725	10 nonqualified withdrawal or refund that was previously
726	726	11 deducted from base income under subsection (a)(2)(HH)
727	727	12 of this Section;
728	728	13 (D-23) An amount equal to the credit allowable to
729	729	14 the taxpayer under Section 218(a) of this Act,
730	730	15 determined without regard to Section 218(c) of this
731	731	16 Act;
732	732	17 (D-24) For taxable years ending on or after
733	733	18 December 31, 2017, an amount equal to the deduction
734	734	19 allowed under Section 199 of the Internal Revenue Code
735	735	20 for the taxable year;
736	736	21 (D-25) In the case of a resident, an amount equal
737	737	22 to the amount of tax for which a credit is allowed
738	738	23 pursuant to Section 201(p)(7) of this Act;
739	739	24 (D-26) the amount that is claimed as a federal
740	740	25 deduction when computing the taxpayer's federal
741	741	26 taxable income for the taxable year and that is
742	742
743	743
744	744
745	745
746	746
747	747	HB1241 - 20 - LRB103 25002 HLH 51336 b
748	748
749	749
750	750	HB1241- 21 -LRB103 25002 HLH 51336 b HB1241 - 21 - LRB103 25002 HLH 51336 b
751	751	HB1241 - 21 - LRB103 25002 HLH 51336 b
752	752	1 attributable to an endowment gift for which the
753	753	2 taxpayer receives a credit under the Endow Illinois
754	754	3 Tax Credit Act;
755	755	4 and by deducting from the total so obtained the sum of the
756	756	5 following amounts:
757	757	6 (E) For taxable years ending before December 31,
758	758	7 2001, any amount included in such total in respect of
759	759	8 any compensation (including but not limited to any
760	760	9 compensation paid or accrued to a serviceman while a
761	761	10 prisoner of war or missing in action) paid to a
762	762	11 resident by reason of being on active duty in the Armed
763	763	12 Forces of the United States and in respect of any
764	764	13 compensation paid or accrued to a resident who as a
765	765	14 governmental employee was a prisoner of war or missing
766	766	15 in action, and in respect of any compensation paid to a
767	767	16 resident in 1971 or thereafter for annual training
768	768	17 performed pursuant to Sections 502 and 503, Title 32,
769	769	18 United States Code as a member of the Illinois
770	770	19 National Guard or, beginning with taxable years ending
771	771	20 on or after December 31, 2007, the National Guard of
772	772	21 any other state. For taxable years ending on or after
773	773	22 December 31, 2001, any amount included in such total
774	774	23 in respect of any compensation (including but not
775	775	24 limited to any compensation paid or accrued to a
776	776	25 serviceman while a prisoner of war or missing in
777	777	26 action) paid to a resident by reason of being a member
778	778
779	779
780	780
781	781
782	782
783	783	HB1241 - 21 - LRB103 25002 HLH 51336 b
784	784
785	785
786	786	HB1241- 22 -LRB103 25002 HLH 51336 b HB1241 - 22 - LRB103 25002 HLH 51336 b
787	787	HB1241 - 22 - LRB103 25002 HLH 51336 b
788	788	1 of any component of the Armed Forces of the United
789	789	2 States and in respect of any compensation paid or
790	790	3 accrued to a resident who as a governmental employee
791	791	4 was a prisoner of war or missing in action, and in
792	792	5 respect of any compensation paid to a resident in 2001
793	793	6 or thereafter by reason of being a member of the
794	794	7 Illinois National Guard or, beginning with taxable
795	795	8 years ending on or after December 31, 2007, the
796	796	9 National Guard of any other state. The provisions of
797	797	10 this subparagraph (E) are exempt from the provisions
798	798	11 of Section 250;
799	799	12 (F) An amount equal to all amounts included in
800	800	13 such total pursuant to the provisions of Sections
801	801	14 402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and
802	802	15 408 of the Internal Revenue Code, or included in such
803	803	16 total as distributions under the provisions of any
804	804	17 retirement or disability plan for employees of any
805	805	18 governmental agency or unit, or retirement payments to
806	806	19 retired partners, which payments are excluded in
807	807	20 computing net earnings from self employment by Section
808	808	21 1402 of the Internal Revenue Code and regulations
809	809	22 adopted pursuant thereto;
810	810	23 (G) The valuation limitation amount;
811	811	24 (H) An amount equal to the amount of any tax
812	812	25 imposed by this Act which was refunded to the taxpayer
813	813	26 and included in such total for the taxable year;
814	814
815	815
816	816
817	817
818	818
819	819	HB1241 - 22 - LRB103 25002 HLH 51336 b
820	820
821	821
822	822	HB1241- 23 -LRB103 25002 HLH 51336 b HB1241 - 23 - LRB103 25002 HLH 51336 b
823	823	HB1241 - 23 - LRB103 25002 HLH 51336 b
824	824	1 (I) An amount equal to all amounts included in
825	825	2 such total pursuant to the provisions of Section 111
826	826	3 of the Internal Revenue Code as a recovery of items
827	827	4 previously deducted from adjusted gross income in the
828	828	5 computation of taxable income;
829	829	6 (J) An amount equal to those dividends included in
830	830	7 such total which were paid by a corporation which
831	831	8 conducts business operations in a River Edge
832	832	9 Redevelopment Zone or zones created under the River
833	833	10 Edge Redevelopment Zone Act, and conducts
834	834	11 substantially all of its operations in a River Edge
835	835	12 Redevelopment Zone or zones. This subparagraph (J) is
836	836	13 exempt from the provisions of Section 250;
837	837	14 (K) An amount equal to those dividends included in
838	838	15 such total that were paid by a corporation that
839	839	16 conducts business operations in a federally designated
840	840	17 Foreign Trade Zone or Sub-Zone and that is designated
841	841	18 a High Impact Business located in Illinois; provided
842	842	19 that dividends eligible for the deduction provided in
843	843	20 subparagraph (J) of paragraph (2) of this subsection
844	844	21 shall not be eligible for the deduction provided under
845	845	22 this subparagraph (K);
846	846	23 (L) For taxable years ending after December 31,
847	847	24 1983, an amount equal to all social security benefits
848	848	25 and railroad retirement benefits included in such
849	849	26 total pursuant to Sections 72(r) and 86 of the
850	850
851	851
852	852
853	853
854	854
855	855	HB1241 - 23 - LRB103 25002 HLH 51336 b
856	856
857	857
858	858	HB1241- 24 -LRB103 25002 HLH 51336 b HB1241 - 24 - LRB103 25002 HLH 51336 b
859	859	HB1241 - 24 - LRB103 25002 HLH 51336 b
860	860	1 Internal Revenue Code;
861	861	2 (M) With the exception of any amounts subtracted
862	862	3 under subparagraph (N), an amount equal to the sum of
863	863	4 all amounts disallowed as deductions by (i) Sections
864	864	5 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
865	865	6 and all amounts of expenses allocable to interest and
866	866	7 disallowed as deductions by Section 265(a)(1) of the
867	867	8 Internal Revenue Code; and (ii) for taxable years
868	868	9 ending on or after August 13, 1999, Sections
869	869	10 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
870	870	11 Internal Revenue Code, plus, for taxable years ending
871	871	12 on or after December 31, 2011, Section 45G(e)(3) of
872	872	13 the Internal Revenue Code and, for taxable years
873	873	14 ending on or after December 31, 2008, any amount
874	874	15 included in gross income under Section 87 of the
875	875	16 Internal Revenue Code; the provisions of this
876	876	17 subparagraph are exempt from the provisions of Section
877	877	18 250;
878	878	19 (N) An amount equal to all amounts included in
879	879	20 such total which are exempt from taxation by this
880	880	21 State either by reason of its statutes or Constitution
881	881	22 or by reason of the Constitution, treaties or statutes
882	882	23 of the United States; provided that, in the case of any
883	883	24 statute of this State that exempts income derived from
884	884	25 bonds or other obligations from the tax imposed under
885	885	26 this Act, the amount exempted shall be the interest
886	886
887	887
888	888
889	889
890	890
891	891	HB1241 - 24 - LRB103 25002 HLH 51336 b
892	892
893	893
894	894	HB1241- 25 -LRB103 25002 HLH 51336 b HB1241 - 25 - LRB103 25002 HLH 51336 b
895	895	HB1241 - 25 - LRB103 25002 HLH 51336 b
896	896	1 net of bond premium amortization;
897	897	2 (O) An amount equal to any contribution made to a
898	898	3 job training project established pursuant to the Tax
899	899	4 Increment Allocation Redevelopment Act;
900	900	5 (P) An amount equal to the amount of the deduction
901	901	6 used to compute the federal income tax credit for
902	902	7 restoration of substantial amounts held under claim of
903	903	8 right for the taxable year pursuant to Section 1341 of
904	904	9 the Internal Revenue Code or of any itemized deduction
905	905	10 taken from adjusted gross income in the computation of
906	906	11 taxable income for restoration of substantial amounts
907	907	12 held under claim of right for the taxable year;
908	908	13 (Q) An amount equal to any amounts included in
909	909	14 such total, received by the taxpayer as an
910	910	15 acceleration in the payment of life, endowment or
911	911	16 annuity benefits in advance of the time they would
912	912	17 otherwise be payable as an indemnity for a terminal
913	913	18 illness;
914	914	19 (R) An amount equal to the amount of any federal or
915	915	20 State bonus paid to veterans of the Persian Gulf War;
916	916	21 (S) An amount, to the extent included in adjusted
917	917	22 gross income, equal to the amount of a contribution
918	918	23 made in the taxable year on behalf of the taxpayer to a
919	919	24 medical care savings account established under the
920	920	25 Medical Care Savings Account Act or the Medical Care
921	921	26 Savings Account Act of 2000 to the extent the
922	922
923	923
924	924
925	925
926	926
927	927	HB1241 - 25 - LRB103 25002 HLH 51336 b
928	928
929	929
930	930	HB1241- 26 -LRB103 25002 HLH 51336 b HB1241 - 26 - LRB103 25002 HLH 51336 b
931	931	HB1241 - 26 - LRB103 25002 HLH 51336 b
932	932	1 contribution is accepted by the account administrator
933	933	2 as provided in that Act;
934	934	3 (T) An amount, to the extent included in adjusted
935	935	4 gross income, equal to the amount of interest earned
936	936	5 in the taxable year on a medical care savings account
937	937	6 established under the Medical Care Savings Account Act
938	938	7 or the Medical Care Savings Account Act of 2000 on
939	939	8 behalf of the taxpayer, other than interest added
940	940	9 pursuant to item (D-5) of this paragraph (2);
941	941	10 (U) For one taxable year beginning on or after
942	942	11 January 1, 1994, an amount equal to the total amount of
943	943	12 tax imposed and paid under subsections (a) and (b) of
944	944	13 Section 201 of this Act on grant amounts received by
945	945	14 the taxpayer under the Nursing Home Grant Assistance
946	946	15 Act during the taxpayer's taxable years 1992 and 1993;
947	947	16 (V) Beginning with tax years ending on or after
948	948	17 December 31, 1995 and ending with tax years ending on
949	949	18 or before December 31, 2004, an amount equal to the
950	950	19 amount paid by a taxpayer who is a self-employed
951	951	20 taxpayer, a partner of a partnership, or a shareholder
952	952	21 in a Subchapter S corporation for health insurance or
953	953	22 long-term care insurance for that taxpayer or that
954	954	23 taxpayer's spouse or dependents, to the extent that
955	955	24 the amount paid for that health insurance or long-term
956	956	25 care insurance may be deducted under Section 213 of
957	957	26 the Internal Revenue Code, has not been deducted on
958	958
959	959
960	960
961	961
962	962
963	963	HB1241 - 26 - LRB103 25002 HLH 51336 b
964	964
965	965
966	966	HB1241- 27 -LRB103 25002 HLH 51336 b HB1241 - 27 - LRB103 25002 HLH 51336 b
967	967	HB1241 - 27 - LRB103 25002 HLH 51336 b
968	968	1 the federal income tax return of the taxpayer, and
969	969	2 does not exceed the taxable income attributable to
970	970	3 that taxpayer's income, self-employment income, or
971	971	4 Subchapter S corporation income; except that no
972	972	5 deduction shall be allowed under this item (V) if the
973	973	6 taxpayer is eligible to participate in any health
974	974	7 insurance or long-term care insurance plan of an
975	975	8 employer of the taxpayer or the taxpayer's spouse. The
976	976	9 amount of the health insurance and long-term care
977	977	10 insurance subtracted under this item (V) shall be
978	978	11 determined by multiplying total health insurance and
979	979	12 long-term care insurance premiums paid by the taxpayer
980	980	13 times a number that represents the fractional
981	981	14 percentage of eligible medical expenses under Section
982	982	15 213 of the Internal Revenue Code of 1986 not actually
983	983	16 deducted on the taxpayer's federal income tax return;
984	984	17 (W) For taxable years beginning on or after
985	985	18 January 1, 1998, all amounts included in the
986	986	19 taxpayer's federal gross income in the taxable year
987	987	20 from amounts converted from a regular IRA to a Roth
988	988	21 IRA. This paragraph is exempt from the provisions of
989	989	22 Section 250;
990	990	23 (X) For taxable year 1999 and thereafter, an
991	991	24 amount equal to the amount of any (i) distributions,
992	992	25 to the extent includible in gross income for federal
993	993	26 income tax purposes, made to the taxpayer because of
994	994
995	995
996	996
997	997
998	998
999	999	HB1241 - 27 - LRB103 25002 HLH 51336 b
1000	1000
1001	1001
1002	1002	HB1241- 28 -LRB103 25002 HLH 51336 b HB1241 - 28 - LRB103 25002 HLH 51336 b
1003	1003	HB1241 - 28 - LRB103 25002 HLH 51336 b
1004	1004	1 his or her status as a victim of persecution for racial
1005	1005	2 or religious reasons by Nazi Germany or any other Axis
1006	1006	3 regime or as an heir of the victim and (ii) items of
1007	1007	4 income, to the extent includible in gross income for
1008	1008	5 federal income tax purposes, attributable to, derived
1009	1009	6 from or in any way related to assets stolen from,
1010	1010	7 hidden from, or otherwise lost to a victim of
1011	1011	8 persecution for racial or religious reasons by Nazi
1012	1012	9 Germany or any other Axis regime immediately prior to,
1013	1013	10 during, and immediately after World War II, including,
1014	1014	11 but not limited to, interest on the proceeds
1015	1015	12 receivable as insurance under policies issued to a
1016	1016	13 victim of persecution for racial or religious reasons
1017	1017	14 by Nazi Germany or any other Axis regime by European
1018	1018	15 insurance companies immediately prior to and during
1019	1019	16 World War II; provided, however, this subtraction from
1020	1020	17 federal adjusted gross income does not apply to assets
1021	1021	18 acquired with such assets or with the proceeds from
1022	1022	19 the sale of such assets; provided, further, this
1023	1023	20 paragraph shall only apply to a taxpayer who was the
1024	1024	21 first recipient of such assets after their recovery
1025	1025	22 and who is a victim of persecution for racial or
1026	1026	23 religious reasons by Nazi Germany or any other Axis
1027	1027	24 regime or as an heir of the victim. The amount of and
1028	1028	25 the eligibility for any public assistance, benefit, or
1029	1029	26 similar entitlement is not affected by the inclusion
1030	1030
1031	1031
1032	1032
1033	1033
1034	1034
1035	1035	HB1241 - 28 - LRB103 25002 HLH 51336 b
1036	1036
1037	1037
1038	1038	HB1241- 29 -LRB103 25002 HLH 51336 b HB1241 - 29 - LRB103 25002 HLH 51336 b
1039	1039	HB1241 - 29 - LRB103 25002 HLH 51336 b
1040	1040	1 of items (i) and (ii) of this paragraph in gross income
1041	1041	2 for federal income tax purposes. This paragraph is
1042	1042	3 exempt from the provisions of Section 250;
1043	1043	4 (Y) For taxable years beginning on or after
1044	1044	5 January 1, 2002 and ending on or before December 31,
1045	1045	6 2004, moneys contributed in the taxable year to a
1046	1046	7 College Savings Pool account under Section 16.5 of the
1047	1047	8 State Treasurer Act, except that amounts excluded from
1048	1048	9 gross income under Section 529(c)(3)(C)(i) of the
1049	1049	10 Internal Revenue Code shall not be considered moneys
1050	1050	11 contributed under this subparagraph (Y). For taxable
1051	1051	12 years beginning on or after January 1, 2005, a maximum
1052	1052	13 of $10,000 contributed in the taxable year to (i) a
1053	1053	14 College Savings Pool account under Section 16.5 of the
1054	1054	15 State Treasurer Act or (ii) the Illinois Prepaid
1055	1055	16 Tuition Trust Fund, except that amounts excluded from
1056	1056	17 gross income under Section 529(c)(3)(C)(i) of the
1057	1057	18 Internal Revenue Code shall not be considered moneys
1058	1058	19 contributed under this subparagraph (Y). For purposes
1059	1059	20 of this subparagraph, contributions made by an
1060	1060	21 employer on behalf of an employee, or matching
1061	1061	22 contributions made by an employee, shall be treated as
1062	1062	23 made by the employee. This subparagraph (Y) is exempt
1063	1063	24 from the provisions of Section 250;
1064	1064	25 (Z) For taxable years 2001 and thereafter, for the
1065	1065	26 taxable year in which the bonus depreciation deduction
1066	1066
1067	1067
1068	1068
1069	1069
1070	1070
1071	1071	HB1241 - 29 - LRB103 25002 HLH 51336 b
1072	1072
1073	1073
1074	1074	HB1241- 30 -LRB103 25002 HLH 51336 b HB1241 - 30 - LRB103 25002 HLH 51336 b
1075	1075	HB1241 - 30 - LRB103 25002 HLH 51336 b
1076	1076	1 is taken on the taxpayer's federal income tax return
1077	1077	2 under subsection (k) of Section 168 of the Internal
1078	1078	3 Revenue Code and for each applicable taxable year
1079	1079	4 thereafter, an amount equal to "x", where:
1080	1080	5 (1) "y" equals the amount of the depreciation
1081	1081	6 deduction taken for the taxable year on the
1082	1082	7 taxpayer's federal income tax return on property
1083	1083	8 for which the bonus depreciation deduction was
1084	1084	9 taken in any year under subsection (k) of Section
1085	1085	10 168 of the Internal Revenue Code, but not
1086	1086	11 including the bonus depreciation deduction;
1087	1087	12 (2) for taxable years ending on or before
1088	1088	13 December 31, 2005, "x" equals "y" multiplied by 30
1089	1089	14 and then divided by 70 (or "y" multiplied by
1090	1090	15 0.429); and
1091	1091	16 (3) for taxable years ending after December
1092	1092	17 31, 2005:
1093	1093	18 (i) for property on which a bonus
1094	1094	19 depreciation deduction of 30% of the adjusted
1095	1095	20 basis was taken, "x" equals "y" multiplied by
1096	1096	21 30 and then divided by 70 (or "y" multiplied
1097	1097	22 by 0.429);
1098	1098	23 (ii) for property on which a bonus
1099	1099	24 depreciation deduction of 50% of the adjusted
1100	1100	25 basis was taken, "x" equals "y" multiplied by
1101	1101	26 1.0;
1102	1102
1103	1103
1104	1104
1105	1105
1106	1106
1107	1107	HB1241 - 30 - LRB103 25002 HLH 51336 b
1108	1108
1109	1109
1110	1110	HB1241- 31 -LRB103 25002 HLH 51336 b HB1241 - 31 - LRB103 25002 HLH 51336 b
1111	1111	HB1241 - 31 - LRB103 25002 HLH 51336 b
1112	1112	1 (iii) for property on which a bonus
1113	1113	2 depreciation deduction of 100% of the adjusted
1114	1114	3 basis was taken in a taxable year ending on or
1115	1115	4 after December 31, 2021, "x" equals the
1116	1116	5 depreciation deduction that would be allowed
1117	1117	6 on that property if the taxpayer had made the
1118	1118	7 election under Section 168(k)(7) of the
1119	1119	8 Internal Revenue Code to not claim bonus
1120	1120	9 depreciation on that property; and
1121	1121	10 (iv) for property on which a bonus
1122	1122	11 depreciation deduction of a percentage other
1123	1123	12 than 30%, 50% or 100% of the adjusted basis
1124	1124	13 was taken in a taxable year ending on or after
1125	1125	14 December 31, 2021, "x" equals "y" multiplied
1126	1126	15 by 100 times the percentage bonus depreciation
1127	1127	16 on the property (that is, 100(bonus%)) and
1128	1128	17 then divided by 100 times 1 minus the
1129	1129	18 percentage bonus depreciation on the property
1130	1130	19 (that is, 100(1bonus%)).
1131	1131	20 The aggregate amount deducted under this
1132	1132	21 subparagraph in all taxable years for any one piece of
1133	1133	22 property may not exceed the amount of the bonus
1134	1134	23 depreciation deduction taken on that property on the
1135	1135	24 taxpayer's federal income tax return under subsection
1136	1136	25 (k) of Section 168 of the Internal Revenue Code. This
1137	1137	26 subparagraph (Z) is exempt from the provisions of
1138	1138
1139	1139
1140	1140
1141	1141
1142	1142
1143	1143	HB1241 - 31 - LRB103 25002 HLH 51336 b
1144	1144
1145	1145
1146	1146	HB1241- 32 -LRB103 25002 HLH 51336 b HB1241 - 32 - LRB103 25002 HLH 51336 b
1147	1147	HB1241 - 32 - LRB103 25002 HLH 51336 b
1148	1148	1 Section 250;
1149	1149	2 (AA) If the taxpayer sells, transfers, abandons,
1150	1150	3 or otherwise disposes of property for which the
1151	1151	4 taxpayer was required in any taxable year to make an
1152	1152	5 addition modification under subparagraph (D-15), then
1153	1153	6 an amount equal to that addition modification.
1154	1154	7 If the taxpayer continues to own property through
1155	1155	8 the last day of the last tax year for which a
1156	1156	9 subtraction is allowed with respect to that property
1157	1157	10 under subparagraph (Z) and for which the taxpayer was
1158	1158	11 required in any taxable year to make an addition
1159	1159	12 modification under subparagraph (D-15), then an amount
1160	1160	13 equal to that addition modification.
1161	1161	14 The taxpayer is allowed to take the deduction
1162	1162	15 under this subparagraph only once with respect to any
1163	1163	16 one piece of property.
1164	1164	17 This subparagraph (AA) is exempt from the
1165	1165	18 provisions of Section 250;
1166	1166	19 (BB) Any amount included in adjusted gross income,
1167	1167	20 other than salary, received by a driver in a
1168	1168	21 ridesharing arrangement using a motor vehicle;
1169	1169	22 (CC) The amount of (i) any interest income (net of
1170	1170	23 the deductions allocable thereto) taken into account
1171	1171	24 for the taxable year with respect to a transaction
1172	1172	25 with a taxpayer that is required to make an addition
1173	1173	26 modification with respect to such transaction under
1174	1174
1175	1175
1176	1176
1177	1177
1178	1178
1179	1179	HB1241 - 32 - LRB103 25002 HLH 51336 b
1180	1180
1181	1181
1182	1182	HB1241- 33 -LRB103 25002 HLH 51336 b HB1241 - 33 - LRB103 25002 HLH 51336 b
1183	1183	HB1241 - 33 - LRB103 25002 HLH 51336 b
1184	1184	1 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
1185	1185	2 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
1186	1186	3 the amount of that addition modification, and (ii) any
1187	1187	4 income from intangible property (net of the deductions
1188	1188	5 allocable thereto) taken into account for the taxable
1189	1189	6 year with respect to a transaction with a taxpayer
1190	1190	7 that is required to make an addition modification with
1191	1191	8 respect to such transaction under Section
1192	1192	9 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
1193	1193	10 203(d)(2)(D-8), but not to exceed the amount of that
1194	1194	11 addition modification. This subparagraph (CC) is
1195	1195	12 exempt from the provisions of Section 250;
1196	1196	13 (DD) An amount equal to the interest income taken
1197	1197	14 into account for the taxable year (net of the
1198	1198	15 deductions allocable thereto) with respect to
1199	1199	16 transactions with (i) a foreign person who would be a
1200	1200	17 member of the taxpayer's unitary business group but
1201	1201	18 for the fact that the foreign person's business
1202	1202	19 activity outside the United States is 80% or more of
1203	1203	20 that person's total business activity and (ii) for
1204	1204	21 taxable years ending on or after December 31, 2008, to
1205	1205	22 a person who would be a member of the same unitary
1206	1206	23 business group but for the fact that the person is
1207	1207	24 prohibited under Section 1501(a)(27) from being
1208	1208	25 included in the unitary business group because he or
1209	1209	26 she is ordinarily required to apportion business
1210	1210
1211	1211
1212	1212
1213	1213
1214	1214
1215	1215	HB1241 - 33 - LRB103 25002 HLH 51336 b
1216	1216
1217	1217
1218	1218	HB1241- 34 -LRB103 25002 HLH 51336 b HB1241 - 34 - LRB103 25002 HLH 51336 b
1219	1219	HB1241 - 34 - LRB103 25002 HLH 51336 b
1220	1220	1 income under different subsections of Section 304, but
1221	1221	2 not to exceed the addition modification required to be
1222	1222	3 made for the same taxable year under Section
1223	1223	4 203(a)(2)(D-17) for interest paid, accrued, or
1224	1224	5 incurred, directly or indirectly, to the same person.
1225	1225	6 This subparagraph (DD) is exempt from the provisions
1226	1226	7 of Section 250;
1227	1227	8 (EE) An amount equal to the income from intangible
1228	1228	9 property taken into account for the taxable year (net
1229	1229	10 of the deductions allocable thereto) with respect to
1230	1230	11 transactions with (i) a foreign person who would be a
1231	1231	12 member of the taxpayer's unitary business group but
1232	1232	13 for the fact that the foreign person's business
1233	1233	14 activity outside the United States is 80% or more of
1234	1234	15 that person's total business activity and (ii) for
1235	1235	16 taxable years ending on or after December 31, 2008, to
1236	1236	17 a person who would be a member of the same unitary
1237	1237	18 business group but for the fact that the person is
1238	1238	19 prohibited under Section 1501(a)(27) from being
1239	1239	20 included in the unitary business group because he or
1240	1240	21 she is ordinarily required to apportion business
1241	1241	22 income under different subsections of Section 304, but
1242	1242	23 not to exceed the addition modification required to be
1243	1243	24 made for the same taxable year under Section
1244	1244	25 203(a)(2)(D-18) for intangible expenses and costs
1245	1245	26 paid, accrued, or incurred, directly or indirectly, to
1246	1246
1247	1247
1248	1248
1249	1249
1250	1250
1251	1251	HB1241 - 34 - LRB103 25002 HLH 51336 b
1252	1252
1253	1253
1254	1254	HB1241- 35 -LRB103 25002 HLH 51336 b HB1241 - 35 - LRB103 25002 HLH 51336 b
1255	1255	HB1241 - 35 - LRB103 25002 HLH 51336 b
1256	1256	1 the same foreign person. This subparagraph (EE) is
1257	1257	2 exempt from the provisions of Section 250;
1258	1258	3 (FF) An amount equal to any amount awarded to the
1259	1259	4 taxpayer during the taxable year by the Court of
1260	1260	5 Claims under subsection (c) of Section 8 of the Court
1261	1261	6 of Claims Act for time unjustly served in a State
1262	1262	7 prison. This subparagraph (FF) is exempt from the
1263	1263	8 provisions of Section 250;
1264	1264	9 (GG) For taxable years ending on or after December
1265	1265	10 31, 2011, in the case of a taxpayer who was required to
1266	1266	11 add back any insurance premiums under Section
1267	1267	12 203(a)(2)(D-19), such taxpayer may elect to subtract
1268	1268	13 that part of a reimbursement received from the
1269	1269	14 insurance company equal to the amount of the expense
1270	1270	15 or loss (including expenses incurred by the insurance
1271	1271	16 company) that would have been taken into account as a
1272	1272	17 deduction for federal income tax purposes if the
1273	1273	18 expense or loss had been uninsured. If a taxpayer
1274	1274	19 makes the election provided for by this subparagraph
1275	1275	20 (GG), the insurer to which the premiums were paid must
1276	1276	21 add back to income the amount subtracted by the
1277	1277	22 taxpayer pursuant to this subparagraph (GG). This
1278	1278	23 subparagraph (GG) is exempt from the provisions of
1279	1279	24 Section 250;
1280	1280	25 (HH) For taxable years beginning on or after
1281	1281	26 January 1, 2018 and prior to January 1, 2028, a maximum
1282	1282
1283	1283
1284	1284
1285	1285
1286	1286
1287	1287	HB1241 - 35 - LRB103 25002 HLH 51336 b
1288	1288
1289	1289
1290	1290	HB1241- 36 -LRB103 25002 HLH 51336 b HB1241 - 36 - LRB103 25002 HLH 51336 b
1291	1291	HB1241 - 36 - LRB103 25002 HLH 51336 b
1292	1292	1 of $10,000 contributed in the taxable year to a
1293	1293	2 qualified ABLE account under Section 16.6 of the State
1294	1294	3 Treasurer Act, except that amounts excluded from gross
1295	1295	4 income under Section 529(c)(3)(C)(i) or Section
1296	1296	5 529A(c)(1)(C) of the Internal Revenue Code shall not
1297	1297	6 be considered moneys contributed under this
1298	1298	7 subparagraph (HH). For purposes of this subparagraph
1299	1299	8 (HH), contributions made by an employer on behalf of
1300	1300	9 an employee, or matching contributions made by an
1301	1301	10 employee, shall be treated as made by the employee;
1302	1302	11 and
1303	1303	12 (II) For taxable years that begin on or after
1304	1304	13 January 1, 2021 and begin before January 1, 2026, the
1305	1305	14 amount that is included in the taxpayer's federal
1306	1306	15 adjusted gross income pursuant to Section 61 of the
1307	1307	16 Internal Revenue Code as discharge of indebtedness
1308	1308	17 attributable to student loan forgiveness and that is
1309	1309	18 not excluded from the taxpayer's federal adjusted
1310	1310	19 gross income pursuant to paragraph (5) of subsection
1311	1311	20 (f) of Section 108 of the Internal Revenue Code.
1312	1312	21 (b) Corporations.
1313	1313	22 (1) In general. In the case of a corporation, base
1314	1314	23 income means an amount equal to the taxpayer's taxable
1315	1315	24 income for the taxable year as modified by paragraph (2).
1316	1316	25 (2) Modifications. The taxable income referred to in
1317	1317
1318	1318
1319	1319
1320	1320
1321	1321
1322	1322	HB1241 - 36 - LRB103 25002 HLH 51336 b
1323	1323
1324	1324
1325	1325	HB1241- 37 -LRB103 25002 HLH 51336 b HB1241 - 37 - LRB103 25002 HLH 51336 b
1326	1326	HB1241 - 37 - LRB103 25002 HLH 51336 b
1327	1327	1 paragraph (1) shall be modified by adding thereto the sum
1328	1328	2 of the following amounts:
1329	1329	3 (A) An amount equal to all amounts paid or accrued
1330	1330	4 to the taxpayer as interest and all distributions
1331	1331	5 received from regulated investment companies during
1332	1332	6 the taxable year to the extent excluded from gross
1333	1333	7 income in the computation of taxable income;
1334	1334	8 (B) An amount equal to the amount of tax imposed by
1335	1335	9 this Act to the extent deducted from gross income in
1336	1336	10 the computation of taxable income for the taxable
1337	1337	11 year;
1338	1338	12 (C) In the case of a regulated investment company,
1339	1339	13 an amount equal to the excess of (i) the net long-term
1340	1340	14 capital gain for the taxable year, over (ii) the
1341	1341	15 amount of the capital gain dividends designated as
1342	1342	16 such in accordance with Section 852(b)(3)(C) of the
1343	1343	17 Internal Revenue Code and any amount designated under
1344	1344	18 Section 852(b)(3)(D) of the Internal Revenue Code,
1345	1345	19 attributable to the taxable year (this amendatory Act
1346	1346	20 of 1995 (Public Act 89-89) is declarative of existing
1347	1347	21 law and is not a new enactment);
1348	1348	22 (D) The amount of any net operating loss deduction
1349	1349	23 taken in arriving at taxable income, other than a net
1350	1350	24 operating loss carried forward from a taxable year
1351	1351	25 ending prior to December 31, 1986;
1352	1352	26 (E) For taxable years in which a net operating
1353	1353
1354	1354
1355	1355
1356	1356
1357	1357
1358	1358	HB1241 - 37 - LRB103 25002 HLH 51336 b
1359	1359
1360	1360
1361	1361	HB1241- 38 -LRB103 25002 HLH 51336 b HB1241 - 38 - LRB103 25002 HLH 51336 b
1362	1362	HB1241 - 38 - LRB103 25002 HLH 51336 b
1363	1363	1 loss carryback or carryforward from a taxable year
1364	1364	2 ending prior to December 31, 1986 is an element of
1365	1365	3 taxable income under paragraph (1) of subsection (e)
1366	1366	4 or subparagraph (E) of paragraph (2) of subsection
1367	1367	5 (e), the amount by which addition modifications other
1368	1368	6 than those provided by this subparagraph (E) exceeded
1369	1369	7 subtraction modifications in such earlier taxable
1370	1370	8 year, with the following limitations applied in the
1371	1371	9 order that they are listed:
1372	1372	10 (i) the addition modification relating to the
1373	1373	11 net operating loss carried back or forward to the
1374	1374	12 taxable year from any taxable year ending prior to
1375	1375	13 December 31, 1986 shall be reduced by the amount
1376	1376	14 of addition modification under this subparagraph
1377	1377	15 (E) which related to that net operating loss and
1378	1378	16 which was taken into account in calculating the
1379	1379	17 base income of an earlier taxable year, and
1380	1380	18 (ii) the addition modification relating to the
1381	1381	19 net operating loss carried back or forward to the
1382	1382	20 taxable year from any taxable year ending prior to
1383	1383	21 December 31, 1986 shall not exceed the amount of
1384	1384	22 such carryback or carryforward;
1385	1385	23 For taxable years in which there is a net
1386	1386	24 operating loss carryback or carryforward from more
1387	1387	25 than one other taxable year ending prior to December
1388	1388	26 31, 1986, the addition modification provided in this
1389	1389
1390	1390
1391	1391
1392	1392
1393	1393
1394	1394	HB1241 - 38 - LRB103 25002 HLH 51336 b
1395	1395
1396	1396
1397	1397	HB1241- 39 -LRB103 25002 HLH 51336 b HB1241 - 39 - LRB103 25002 HLH 51336 b
1398	1398	HB1241 - 39 - LRB103 25002 HLH 51336 b
1399	1399	1 subparagraph (E) shall be the sum of the amounts
1400	1400	2 computed independently under the preceding provisions
1401	1401	3 of this subparagraph (E) for each such taxable year;
1402	1402	4 (E-5) For taxable years ending after December 31,
1403	1403	5 1997, an amount equal to any eligible remediation
1404	1404	6 costs that the corporation deducted in computing
1405	1405	7 adjusted gross income and for which the corporation
1406	1406	8 claims a credit under subsection (l) of Section 201;
1407	1407	9 (E-10) For taxable years 2001 and thereafter, an
1408	1408	10 amount equal to the bonus depreciation deduction taken
1409	1409	11 on the taxpayer's federal income tax return for the
1410	1410	12 taxable year under subsection (k) of Section 168 of
1411	1411	13 the Internal Revenue Code;
1412	1412	14 (E-11) If the taxpayer sells, transfers, abandons,
1413	1413	15 or otherwise disposes of property for which the
1414	1414	16 taxpayer was required in any taxable year to make an
1415	1415	17 addition modification under subparagraph (E-10), then
1416	1416	18 an amount equal to the aggregate amount of the
1417	1417	19 deductions taken in all taxable years under
1418	1418	20 subparagraph (T) with respect to that property.
1419	1419	21 If the taxpayer continues to own property through
1420	1420	22 the last day of the last tax year for which a
1421	1421	23 subtraction is allowed with respect to that property
1422	1422	24 under subparagraph (T) and for which the taxpayer was
1423	1423	25 allowed in any taxable year to make a subtraction
1424	1424	26 modification under subparagraph (T), then an amount
1425	1425
1426	1426
1427	1427
1428	1428
1429	1429
1430	1430	HB1241 - 39 - LRB103 25002 HLH 51336 b
1431	1431
1432	1432
1433	1433	HB1241- 40 -LRB103 25002 HLH 51336 b HB1241 - 40 - LRB103 25002 HLH 51336 b
1434	1434	HB1241 - 40 - LRB103 25002 HLH 51336 b
1435	1435	1 equal to that subtraction modification.
1436	1436	2 The taxpayer is required to make the addition
1437	1437	3 modification under this subparagraph only once with
1438	1438	4 respect to any one piece of property;
1439	1439	5 (E-12) An amount equal to the amount otherwise
1440	1440	6 allowed as a deduction in computing base income for
1441	1441	7 interest paid, accrued, or incurred, directly or
1442	1442	8 indirectly, (i) for taxable years ending on or after
1443	1443	9 December 31, 2004, to a foreign person who would be a
1444	1444	10 member of the same unitary business group but for the
1445	1445	11 fact the foreign person's business activity outside
1446	1446	12 the United States is 80% or more of the foreign
1447	1447	13 person's total business activity and (ii) for taxable
1448	1448	14 years ending on or after December 31, 2008, to a person
1449	1449	15 who would be a member of the same unitary business
1450	1450	16 group but for the fact that the person is prohibited
1451	1451	17 under Section 1501(a)(27) from being included in the
1452	1452	18 unitary business group because he or she is ordinarily
1453	1453	19 required to apportion business income under different
1454	1454	20 subsections of Section 304. The addition modification
1455	1455	21 required by this subparagraph shall be reduced to the
1456	1456	22 extent that dividends were included in base income of
1457	1457	23 the unitary group for the same taxable year and
1458	1458	24 received by the taxpayer or by a member of the
1459	1459	25 taxpayer's unitary business group (including amounts
1460	1460	26 included in gross income pursuant to Sections 951
1461	1461
1462	1462
1463	1463
1464	1464
1465	1465
1466	1466	HB1241 - 40 - LRB103 25002 HLH 51336 b
1467	1467
1468	1468
1469	1469	HB1241- 41 -LRB103 25002 HLH 51336 b HB1241 - 41 - LRB103 25002 HLH 51336 b
1470	1470	HB1241 - 41 - LRB103 25002 HLH 51336 b
1471	1471	1 through 964 of the Internal Revenue Code and amounts
1472	1472	2 included in gross income under Section 78 of the
1473	1473	3 Internal Revenue Code) with respect to the stock of
1474	1474	4 the same person to whom the interest was paid,
1475	1475	5 accrued, or incurred.
1476	1476	6 This paragraph shall not apply to the following:
1477	1477	7 (i) an item of interest paid, accrued, or
1478	1478	8 incurred, directly or indirectly, to a person who
1479	1479	9 is subject in a foreign country or state, other
1480	1480	10 than a state which requires mandatory unitary
1481	1481	11 reporting, to a tax on or measured by net income
1482	1482	12 with respect to such interest; or
1483	1483	13 (ii) an item of interest paid, accrued, or
1484	1484	14 incurred, directly or indirectly, to a person if
1485	1485	15 the taxpayer can establish, based on a
1486	1486	16 preponderance of the evidence, both of the
1487	1487	17 following:
1488	1488	18 (a) the person, during the same taxable
1489	1489	19 year, paid, accrued, or incurred, the interest
1490	1490	20 to a person that is not a related member, and
1491	1491	21 (b) the transaction giving rise to the
1492	1492	22 interest expense between the taxpayer and the
1493	1493	23 person did not have as a principal purpose the
1494	1494	24 avoidance of Illinois income tax, and is paid
1495	1495	25 pursuant to a contract or agreement that
1496	1496	26 reflects an arm's-length interest rate and
1497	1497
1498	1498
1499	1499
1500	1500
1501	1501
1502	1502	HB1241 - 41 - LRB103 25002 HLH 51336 b
1503	1503
1504	1504
1505	1505	HB1241- 42 -LRB103 25002 HLH 51336 b HB1241 - 42 - LRB103 25002 HLH 51336 b
1506	1506	HB1241 - 42 - LRB103 25002 HLH 51336 b
1507	1507	1 terms; or
1508	1508	2 (iii) the taxpayer can establish, based on
1509	1509	3 clear and convincing evidence, that the interest
1510	1510	4 paid, accrued, or incurred relates to a contract
1511	1511	5 or agreement entered into at arm's-length rates
1512	1512	6 and terms and the principal purpose for the
1513	1513	7 payment is not federal or Illinois tax avoidance;
1514	1514	8 or
1515	1515	9 (iv) an item of interest paid, accrued, or
1516	1516	10 incurred, directly or indirectly, to a person if
1517	1517	11 the taxpayer establishes by clear and convincing
1518	1518	12 evidence that the adjustments are unreasonable; or
1519	1519	13 if the taxpayer and the Director agree in writing
1520	1520	14 to the application or use of an alternative method
1521	1521	15 of apportionment under Section 304(f).
1522	1522	16 Nothing in this subsection shall preclude the
1523	1523	17 Director from making any other adjustment
1524	1524	18 otherwise allowed under Section 404 of this Act
1525	1525	19 for any tax year beginning after the effective
1526	1526	20 date of this amendment provided such adjustment is
1527	1527	21 made pursuant to regulation adopted by the
1528	1528	22 Department and such regulations provide methods
1529	1529	23 and standards by which the Department will utilize
1530	1530	24 its authority under Section 404 of this Act;
1531	1531	25 (E-13) An amount equal to the amount of intangible
1532	1532	26 expenses and costs otherwise allowed as a deduction in
1533	1533
1534	1534
1535	1535
1536	1536
1537	1537
1538	1538	HB1241 - 42 - LRB103 25002 HLH 51336 b
1539	1539
1540	1540
1541	1541	HB1241- 43 -LRB103 25002 HLH 51336 b HB1241 - 43 - LRB103 25002 HLH 51336 b
1542	1542	HB1241 - 43 - LRB103 25002 HLH 51336 b
1543	1543	1 computing base income, and that were paid, accrued, or
1544	1544	2 incurred, directly or indirectly, (i) for taxable
1545	1545	3 years ending on or after December 31, 2004, to a
1546	1546	4 foreign person who would be a member of the same
1547	1547	5 unitary business group but for the fact that the
1548	1548	6 foreign person's business activity outside the United
1549	1549	7 States is 80% or more of that person's total business
1550	1550	8 activity and (ii) for taxable years ending on or after
1551	1551	9 December 31, 2008, to a person who would be a member of
1552	1552	10 the same unitary business group but for the fact that
1553	1553	11 the person is prohibited under Section 1501(a)(27)
1554	1554	12 from being included in the unitary business group
1555	1555	13 because he or she is ordinarily required to apportion
1556	1556	14 business income under different subsections of Section
1557	1557	15 304. The addition modification required by this
1558	1558	16 subparagraph shall be reduced to the extent that
1559	1559	17 dividends were included in base income of the unitary
1560	1560	18 group for the same taxable year and received by the
1561	1561	19 taxpayer or by a member of the taxpayer's unitary
1562	1562	20 business group (including amounts included in gross
1563	1563	21 income pursuant to Sections 951 through 964 of the
1564	1564	22 Internal Revenue Code and amounts included in gross
1565	1565	23 income under Section 78 of the Internal Revenue Code)
1566	1566	24 with respect to the stock of the same person to whom
1567	1567	25 the intangible expenses and costs were directly or
1568	1568	26 indirectly paid, incurred, or accrued. The preceding
1569	1569
1570	1570
1571	1571
1572	1572
1573	1573
1574	1574	HB1241 - 43 - LRB103 25002 HLH 51336 b
1575	1575
1576	1576
1577	1577	HB1241- 44 -LRB103 25002 HLH 51336 b HB1241 - 44 - LRB103 25002 HLH 51336 b
1578	1578	HB1241 - 44 - LRB103 25002 HLH 51336 b
1579	1579	1 sentence shall not apply to the extent that the same
1580	1580	2 dividends caused a reduction to the addition
1581	1581	3 modification required under Section 203(b)(2)(E-12) of
1582	1582	4 this Act. As used in this subparagraph, the term
1583	1583	5 "intangible expenses and costs" includes (1) expenses,
1584	1584	6 losses, and costs for, or related to, the direct or
1585	1585	7 indirect acquisition, use, maintenance or management,
1586	1586	8 ownership, sale, exchange, or any other disposition of
1587	1587	9 intangible property; (2) losses incurred, directly or
1588	1588	10 indirectly, from factoring transactions or discounting
1589	1589	11 transactions; (3) royalty, patent, technical, and
1590	1590	12 copyright fees; (4) licensing fees; and (5) other
1591	1591	13 similar expenses and costs. For purposes of this
1592	1592	14 subparagraph, "intangible property" includes patents,
1593	1593	15 patent applications, trade names, trademarks, service
1594	1594	16 marks, copyrights, mask works, trade secrets, and
1595	1595	17 similar types of intangible assets.
1596	1596	18 This paragraph shall not apply to the following:
1597	1597	19 (i) any item of intangible expenses or costs
1598	1598	20 paid, accrued, or incurred, directly or
1599	1599	21 indirectly, from a transaction with a person who
1600	1600	22 is subject in a foreign country or state, other
1601	1601	23 than a state which requires mandatory unitary
1602	1602	24 reporting, to a tax on or measured by net income
1603	1603	25 with respect to such item; or
1604	1604	26 (ii) any item of intangible expense or cost
1605	1605
1606	1606
1607	1607
1608	1608
1609	1609
1610	1610	HB1241 - 44 - LRB103 25002 HLH 51336 b
1611	1611
1612	1612
1613	1613	HB1241- 45 -LRB103 25002 HLH 51336 b HB1241 - 45 - LRB103 25002 HLH 51336 b
1614	1614	HB1241 - 45 - LRB103 25002 HLH 51336 b
1615	1615	1 paid, accrued, or incurred, directly or
1616	1616	2 indirectly, if the taxpayer can establish, based
1617	1617	3 on a preponderance of the evidence, both of the
1618	1618	4 following:
1619	1619	5 (a) the person during the same taxable
1620	1620	6 year paid, accrued, or incurred, the
1621	1621	7 intangible expense or cost to a person that is
1622	1622	8 not a related member, and
1623	1623	9 (b) the transaction giving rise to the
1624	1624	10 intangible expense or cost between the
1625	1625	11 taxpayer and the person did not have as a
1626	1626	12 principal purpose the avoidance of Illinois
1627	1627	13 income tax, and is paid pursuant to a contract
1628	1628	14 or agreement that reflects arm's-length terms;
1629	1629	15 or
1630	1630	16 (iii) any item of intangible expense or cost
1631	1631	17 paid, accrued, or incurred, directly or
1632	1632	18 indirectly, from a transaction with a person if
1633	1633	19 the taxpayer establishes by clear and convincing
1634	1634	20 evidence, that the adjustments are unreasonable;
1635	1635	21 or if the taxpayer and the Director agree in
1636	1636	22 writing to the application or use of an
1637	1637	23 alternative method of apportionment under Section
1638	1638	24 304(f);
1639	1639	25 Nothing in this subsection shall preclude the
1640	1640	26 Director from making any other adjustment
1641	1641
1642	1642
1643	1643
1644	1644
1645	1645
1646	1646	HB1241 - 45 - LRB103 25002 HLH 51336 b
1647	1647
1648	1648
1649	1649	HB1241- 46 -LRB103 25002 HLH 51336 b HB1241 - 46 - LRB103 25002 HLH 51336 b
1650	1650	HB1241 - 46 - LRB103 25002 HLH 51336 b
1651	1651	1 otherwise allowed under Section 404 of this Act
1652	1652	2 for any tax year beginning after the effective
1653	1653	3 date of this amendment provided such adjustment is
1654	1654	4 made pursuant to regulation adopted by the
1655	1655	5 Department and such regulations provide methods
1656	1656	6 and standards by which the Department will utilize
1657	1657	7 its authority under Section 404 of this Act;
1658	1658	8 (E-14) For taxable years ending on or after
1659	1659	9 December 31, 2008, an amount equal to the amount of
1660	1660	10 insurance premium expenses and costs otherwise allowed
1661	1661	11 as a deduction in computing base income, and that were
1662	1662	12 paid, accrued, or incurred, directly or indirectly, to
1663	1663	13 a person who would be a member of the same unitary
1664	1664	14 business group but for the fact that the person is
1665	1665	15 prohibited under Section 1501(a)(27) from being
1666	1666	16 included in the unitary business group because he or
1667	1667	17 she is ordinarily required to apportion business
1668	1668	18 income under different subsections of Section 304. The
1669	1669	19 addition modification required by this subparagraph
1670	1670	20 shall be reduced to the extent that dividends were
1671	1671	21 included in base income of the unitary group for the
1672	1672	22 same taxable year and received by the taxpayer or by a
1673	1673	23 member of the taxpayer's unitary business group
1674	1674	24 (including amounts included in gross income under
1675	1675	25 Sections 951 through 964 of the Internal Revenue Code
1676	1676	26 and amounts included in gross income under Section 78
1677	1677
1678	1678
1679	1679
1680	1680
1681	1681
1682	1682	HB1241 - 46 - LRB103 25002 HLH 51336 b
1683	1683
1684	1684
1685	1685	HB1241- 47 -LRB103 25002 HLH 51336 b HB1241 - 47 - LRB103 25002 HLH 51336 b
1686	1686	HB1241 - 47 - LRB103 25002 HLH 51336 b
1687	1687	1 of the Internal Revenue Code) with respect to the
1688	1688	2 stock of the same person to whom the premiums and costs
1689	1689	3 were directly or indirectly paid, incurred, or
1690	1690	4 accrued. The preceding sentence does not apply to the
1691	1691	5 extent that the same dividends caused a reduction to
1692	1692	6 the addition modification required under Section
1693	1693	7 203(b)(2)(E-12) or Section 203(b)(2)(E-13) of this
1694	1694	8 Act;
1695	1695	9 (E-15) For taxable years beginning after December
1696	1696	10 31, 2008, any deduction for dividends paid by a
1697	1697	11 captive real estate investment trust that is allowed
1698	1698	12 to a real estate investment trust under Section
1699	1699	13 857(b)(2)(B) of the Internal Revenue Code for
1700	1700	14 dividends paid;
1701	1701	15 (E-16) An amount equal to the credit allowable to
1702	1702	16 the taxpayer under Section 218(a) of this Act,
1703	1703	17 determined without regard to Section 218(c) of this
1704	1704	18 Act;
1705	1705	19 (E-17) For taxable years ending on or after
1706	1706	20 December 31, 2017, an amount equal to the deduction
1707	1707	21 allowed under Section 199 of the Internal Revenue Code
1708	1708	22 for the taxable year;
1709	1709	23 (E-18) for taxable years beginning after December
1710	1710	24 31, 2018, an amount equal to the deduction allowed
1711	1711	25 under Section 250(a)(1)(A) of the Internal Revenue
1712	1712	26 Code for the taxable year;
1713	1713
1714	1714
1715	1715
1716	1716
1717	1717
1718	1718	HB1241 - 47 - LRB103 25002 HLH 51336 b
1719	1719
1720	1720
1721	1721	HB1241- 48 -LRB103 25002 HLH 51336 b HB1241 - 48 - LRB103 25002 HLH 51336 b
1722	1722	HB1241 - 48 - LRB103 25002 HLH 51336 b
1723	1723	1 (E-19) for taxable years ending on or after June
1724	1724	2 30, 2021, an amount equal to the deduction allowed
1725	1725	3 under Section 250(a)(1)(B)(i) of the Internal Revenue
1726	1726	4 Code for the taxable year;
1727	1727	5 (E-20) for taxable years ending on or after June
1728	1728	6 30, 2021, an amount equal to the deduction allowed
1729	1729	7 under Sections 243(e) and 245A(a) of the Internal
1730	1730	8 Revenue Code for the taxable year; and .
1731	1731	9 (E-21) the amount that is claimed as a federal
1732	1732	10 deduction when computing the taxpayer's federal
1733	1733	11 taxable income for the taxable year and that is
1734	1734	12 attributable to an endowment gift for which the
1735	1735	13 taxpayer receives a credit under the Endow Illinois
1736	1736	14 Tax Credit Act;
1737	1737	15 and by deducting from the total so obtained the sum of the
1738	1738	16 following amounts:
1739	1739	17 (F) An amount equal to the amount of any tax
1740	1740	18 imposed by this Act which was refunded to the taxpayer
1741	1741	19 and included in such total for the taxable year;
1742	1742	20 (G) An amount equal to any amount included in such
1743	1743	21 total under Section 78 of the Internal Revenue Code;
1744	1744	22 (H) In the case of a regulated investment company,
1745	1745	23 an amount equal to the amount of exempt interest
1746	1746	24 dividends as defined in subsection (b)(5) of Section
1747	1747	25 852 of the Internal Revenue Code, paid to shareholders
1748	1748	26 for the taxable year;
1749	1749
1750	1750
1751	1751
1752	1752
1753	1753
1754	1754	HB1241 - 48 - LRB103 25002 HLH 51336 b
1755	1755
1756	1756
1757	1757	HB1241- 49 -LRB103 25002 HLH 51336 b HB1241 - 49 - LRB103 25002 HLH 51336 b
1758	1758	HB1241 - 49 - LRB103 25002 HLH 51336 b
1759	1759	1 (I) With the exception of any amounts subtracted
1760	1760	2 under subparagraph (J), an amount equal to the sum of
1761	1761	3 all amounts disallowed as deductions by (i) Sections
1762	1762	4 171(a)(2) and 265(a)(2) and amounts disallowed as
1763	1763	5 interest expense by Section 291(a)(3) of the Internal
1764	1764	6 Revenue Code, and all amounts of expenses allocable to
1765	1765	7 interest and disallowed as deductions by Section
1766	1766	8 265(a)(1) of the Internal Revenue Code; and (ii) for
1767	1767	9 taxable years ending on or after August 13, 1999,
1768	1768	10 Sections 171(a)(2), 265, 280C, 291(a)(3), and
1769	1769	11 832(b)(5)(B)(i) of the Internal Revenue Code, plus,
1770	1770	12 for tax years ending on or after December 31, 2011,
1771	1771	13 amounts disallowed as deductions by Section 45G(e)(3)
1772	1772	14 of the Internal Revenue Code and, for taxable years
1773	1773	15 ending on or after December 31, 2008, any amount
1774	1774	16 included in gross income under Section 87 of the
1775	1775	17 Internal Revenue Code and the policyholders' share of
1776	1776	18 tax-exempt interest of a life insurance company under
1777	1777	19 Section 807(a)(2)(B) of the Internal Revenue Code (in
1778	1778	20 the case of a life insurance company with gross income
1779	1779	21 from a decrease in reserves for the tax year) or
1780	1780	22 Section 807(b)(1)(B) of the Internal Revenue Code (in
1781	1781	23 the case of a life insurance company allowed a
1782	1782	24 deduction for an increase in reserves for the tax
1783	1783	25 year); the provisions of this subparagraph are exempt
1784	1784	26 from the provisions of Section 250;
1785	1785
1786	1786
1787	1787
1788	1788
1789	1789
1790	1790	HB1241 - 49 - LRB103 25002 HLH 51336 b
1791	1791
1792	1792
1793	1793	HB1241- 50 -LRB103 25002 HLH 51336 b HB1241 - 50 - LRB103 25002 HLH 51336 b
1794	1794	HB1241 - 50 - LRB103 25002 HLH 51336 b
1795	1795	1 (J) An amount equal to all amounts included in
1796	1796	2 such total which are exempt from taxation by this
1797	1797	3 State either by reason of its statutes or Constitution
1798	1798	4 or by reason of the Constitution, treaties or statutes
1799	1799	5 of the United States; provided that, in the case of any
1800	1800	6 statute of this State that exempts income derived from
1801	1801	7 bonds or other obligations from the tax imposed under
1802	1802	8 this Act, the amount exempted shall be the interest
1803	1803	9 net of bond premium amortization;
1804	1804	10 (K) An amount equal to those dividends included in
1805	1805	11 such total which were paid by a corporation which
1806	1806	12 conducts business operations in a River Edge
1807	1807	13 Redevelopment Zone or zones created under the River
1808	1808	14 Edge Redevelopment Zone Act and conducts substantially
1809	1809	15 all of its operations in a River Edge Redevelopment
1810	1810	16 Zone or zones. This subparagraph (K) is exempt from
1811	1811	17 the provisions of Section 250;
1812	1812	18 (L) An amount equal to those dividends included in
1813	1813	19 such total that were paid by a corporation that
1814	1814	20 conducts business operations in a federally designated
1815	1815	21 Foreign Trade Zone or Sub-Zone and that is designated
1816	1816	22 a High Impact Business located in Illinois; provided
1817	1817	23 that dividends eligible for the deduction provided in
1818	1818	24 subparagraph (K) of paragraph 2 of this subsection
1819	1819	25 shall not be eligible for the deduction provided under
1820	1820	26 this subparagraph (L);
1821	1821
1822	1822
1823	1823
1824	1824
1825	1825
1826	1826	HB1241 - 50 - LRB103 25002 HLH 51336 b
1827	1827
1828	1828
1829	1829	HB1241- 51 -LRB103 25002 HLH 51336 b HB1241 - 51 - LRB103 25002 HLH 51336 b
1830	1830	HB1241 - 51 - LRB103 25002 HLH 51336 b
1831	1831	1 (M) For any taxpayer that is a financial
1832	1832	2 organization within the meaning of Section 304(c) of
1833	1833	3 this Act, an amount included in such total as interest
1834	1834	4 income from a loan or loans made by such taxpayer to a
1835	1835	5 borrower, to the extent that such a loan is secured by
1836	1836	6 property which is eligible for the River Edge
1837	1837	7 Redevelopment Zone Investment Credit. To determine the
1838	1838	8 portion of a loan or loans that is secured by property
1839	1839	9 eligible for a Section 201(f) investment credit to the
1840	1840	10 borrower, the entire principal amount of the loan or
1841	1841	11 loans between the taxpayer and the borrower should be
1842	1842	12 divided into the basis of the Section 201(f)
1843	1843	13 investment credit property which secures the loan or
1844	1844	14 loans, using for this purpose the original basis of
1845	1845	15 such property on the date that it was placed in service
1846	1846	16 in the River Edge Redevelopment Zone. The subtraction
1847	1847	17 modification available to the taxpayer in any year
1848	1848	18 under this subsection shall be that portion of the
1849	1849	19 total interest paid by the borrower with respect to
1850	1850	20 such loan attributable to the eligible property as
1851	1851	21 calculated under the previous sentence. This
1852	1852	22 subparagraph (M) is exempt from the provisions of
1853	1853	23 Section 250;
1854	1854	24 (M-1) For any taxpayer that is a financial
1855	1855	25 organization within the meaning of Section 304(c) of
1856	1856	26 this Act, an amount included in such total as interest
1857	1857
1858	1858
1859	1859
1860	1860
1861	1861
1862	1862	HB1241 - 51 - LRB103 25002 HLH 51336 b
1863	1863
1864	1864
1865	1865	HB1241- 52 -LRB103 25002 HLH 51336 b HB1241 - 52 - LRB103 25002 HLH 51336 b
1866	1866	HB1241 - 52 - LRB103 25002 HLH 51336 b
1867	1867	1 income from a loan or loans made by such taxpayer to a
1868	1868	2 borrower, to the extent that such a loan is secured by
1869	1869	3 property which is eligible for the High Impact
1870	1870	4 Business Investment Credit. To determine the portion
1871	1871	5 of a loan or loans that is secured by property eligible
1872	1872	6 for a Section 201(h) investment credit to the
1873	1873	7 borrower, the entire principal amount of the loan or
1874	1874	8 loans between the taxpayer and the borrower should be
1875	1875	9 divided into the basis of the Section 201(h)
1876	1876	10 investment credit property which secures the loan or
1877	1877	11 loans, using for this purpose the original basis of
1878	1878	12 such property on the date that it was placed in service
1879	1879	13 in a federally designated Foreign Trade Zone or
1880	1880	14 Sub-Zone located in Illinois. No taxpayer that is
1881	1881	15 eligible for the deduction provided in subparagraph
1882	1882	16 (M) of paragraph (2) of this subsection shall be
1883	1883	17 eligible for the deduction provided under this
1884	1884	18 subparagraph (M-1). The subtraction modification
1885	1885	19 available to taxpayers in any year under this
1886	1886	20 subsection shall be that portion of the total interest
1887	1887	21 paid by the borrower with respect to such loan
1888	1888	22 attributable to the eligible property as calculated
1889	1889	23 under the previous sentence;
1890	1890	24 (N) Two times any contribution made during the
1891	1891	25 taxable year to a designated zone organization to the
1892	1892	26 extent that the contribution (i) qualifies as a
1893	1893
1894	1894
1895	1895
1896	1896
1897	1897
1898	1898	HB1241 - 52 - LRB103 25002 HLH 51336 b
1899	1899
1900	1900
1901	1901	HB1241- 53 -LRB103 25002 HLH 51336 b HB1241 - 53 - LRB103 25002 HLH 51336 b
1902	1902	HB1241 - 53 - LRB103 25002 HLH 51336 b
1903	1903	1 charitable contribution under subsection (c) of
1904	1904	2 Section 170 of the Internal Revenue Code and (ii)
1905	1905	3 must, by its terms, be used for a project approved by
1906	1906	4 the Department of Commerce and Economic Opportunity
1907	1907	5 under Section 11 of the Illinois Enterprise Zone Act
1908	1908	6 or under Section 10-10 of the River Edge Redevelopment
1909	1909	7 Zone Act. This subparagraph (N) is exempt from the
1910	1910	8 provisions of Section 250;
1911	1911	9 (O) An amount equal to: (i) 85% for taxable years
1912	1912	10 ending on or before December 31, 1992, or, a
1913	1913	11 percentage equal to the percentage allowable under
1914	1914	12 Section 243(a)(1) of the Internal Revenue Code of 1986
1915	1915	13 for taxable years ending after December 31, 1992, of
1916	1916	14 the amount by which dividends included in taxable
1917	1917	15 income and received from a corporation that is not
1918	1918	16 created or organized under the laws of the United
1919	1919	17 States or any state or political subdivision thereof,
1920	1920	18 including, for taxable years ending on or after
1921	1921	19 December 31, 1988, dividends received or deemed
1922	1922	20 received or paid or deemed paid under Sections 951
1923	1923	21 through 965 of the Internal Revenue Code, exceed the
1924	1924	22 amount of the modification provided under subparagraph
1925	1925	23 (G) of paragraph (2) of this subsection (b) which is
1926	1926	24 related to such dividends, and including, for taxable
1927	1927	25 years ending on or after December 31, 2008, dividends
1928	1928	26 received from a captive real estate investment trust;
1929	1929
1930	1930
1931	1931
1932	1932
1933	1933
1934	1934	HB1241 - 53 - LRB103 25002 HLH 51336 b
1935	1935
1936	1936
1937	1937	HB1241- 54 -LRB103 25002 HLH 51336 b HB1241 - 54 - LRB103 25002 HLH 51336 b
1938	1938	HB1241 - 54 - LRB103 25002 HLH 51336 b
1939	1939	1 plus (ii) 100% of the amount by which dividends,
1940	1940	2 included in taxable income and received, including,
1941	1941	3 for taxable years ending on or after December 31,
1942	1942	4 1988, dividends received or deemed received or paid or
1943	1943	5 deemed paid under Sections 951 through 964 of the
1944	1944	6 Internal Revenue Code and including, for taxable years
1945	1945	7 ending on or after December 31, 2008, dividends
1946	1946	8 received from a captive real estate investment trust,
1947	1947	9 from any such corporation specified in clause (i) that
1948	1948	10 would but for the provisions of Section 1504(b)(3) of
1949	1949	11 the Internal Revenue Code be treated as a member of the
1950	1950	12 affiliated group which includes the dividend
1951	1951	13 recipient, exceed the amount of the modification
1952	1952	14 provided under subparagraph (G) of paragraph (2) of
1953	1953	15 this subsection (b) which is related to such
1954	1954	16 dividends. For taxable years ending on or after June
1955	1955	17 30, 2021, (i) for purposes of this subparagraph, the
1956	1956	18 term "dividend" does not include any amount treated as
1957	1957	19 a dividend under Section 1248 of the Internal Revenue
1958	1958	20 Code, and (ii) this subparagraph shall not apply to
1959	1959	21 dividends for which a deduction is allowed under
1960	1960	22 Section 245(a) of the Internal Revenue Code. This
1961	1961	23 subparagraph (O) is exempt from the provisions of
1962	1962	24 Section 250 of this Act;
1963	1963	25 (P) An amount equal to any contribution made to a
1964	1964	26 job training project established pursuant to the Tax
1965	1965
1966	1966
1967	1967
1968	1968
1969	1969
1970	1970	HB1241 - 54 - LRB103 25002 HLH 51336 b
1971	1971
1972	1972
1973	1973	HB1241- 55 -LRB103 25002 HLH 51336 b HB1241 - 55 - LRB103 25002 HLH 51336 b
1974	1974	HB1241 - 55 - LRB103 25002 HLH 51336 b
1975	1975	1 Increment Allocation Redevelopment Act;
1976	1976	2 (Q) An amount equal to the amount of the deduction
1977	1977	3 used to compute the federal income tax credit for
1978	1978	4 restoration of substantial amounts held under claim of
1979	1979	5 right for the taxable year pursuant to Section 1341 of
1980	1980	6 the Internal Revenue Code;
1981	1981	7 (R) On and after July 20, 1999, in the case of an
1982	1982	8 attorney-in-fact with respect to whom an interinsurer
1983	1983	9 or a reciprocal insurer has made the election under
1984	1984	10 Section 835 of the Internal Revenue Code, 26 U.S.C.
1985	1985	11 835, an amount equal to the excess, if any, of the
1986	1986	12 amounts paid or incurred by that interinsurer or
1987	1987	13 reciprocal insurer in the taxable year to the
1988	1988	14 attorney-in-fact over the deduction allowed to that
1989	1989	15 interinsurer or reciprocal insurer with respect to the
1990	1990	16 attorney-in-fact under Section 835(b) of the Internal
1991	1991	17 Revenue Code for the taxable year; the provisions of
1992	1992	18 this subparagraph are exempt from the provisions of
1993	1993	19 Section 250;
1994	1994	20 (S) For taxable years ending on or after December
1995	1995	21 31, 1997, in the case of a Subchapter S corporation, an
1996	1996	22 amount equal to all amounts of income allocable to a
1997	1997	23 shareholder subject to the Personal Property Tax
1998	1998	24 Replacement Income Tax imposed by subsections (c) and
1999	1999	25 (d) of Section 201 of this Act, including amounts
2000	2000	26 allocable to organizations exempt from federal income
2001	2001
2002	2002
2003	2003
2004	2004
2005	2005
2006	2006	HB1241 - 55 - LRB103 25002 HLH 51336 b
2007	2007
2008	2008
2009	2009	HB1241- 56 -LRB103 25002 HLH 51336 b HB1241 - 56 - LRB103 25002 HLH 51336 b
2010	2010	HB1241 - 56 - LRB103 25002 HLH 51336 b
2011	2011	1 tax by reason of Section 501(a) of the Internal
2012	2012	2 Revenue Code. This subparagraph (S) is exempt from the
2013	2013	3 provisions of Section 250;
2014	2014	4 (T) For taxable years 2001 and thereafter, for the
2015	2015	5 taxable year in which the bonus depreciation deduction
2016	2016	6 is taken on the taxpayer's federal income tax return
2017	2017	7 under subsection (k) of Section 168 of the Internal
2018	2018	8 Revenue Code and for each applicable taxable year
2019	2019	9 thereafter, an amount equal to "x", where:
2020	2020	10 (1) "y" equals the amount of the depreciation
2021	2021	11 deduction taken for the taxable year on the
2022	2022	12 taxpayer's federal income tax return on property
2023	2023	13 for which the bonus depreciation deduction was
2024	2024	14 taken in any year under subsection (k) of Section
2025	2025	15 168 of the Internal Revenue Code, but not
2026	2026	16 including the bonus depreciation deduction;
2027	2027	17 (2) for taxable years ending on or before
2028	2028	18 December 31, 2005, "x" equals "y" multiplied by 30
2029	2029	19 and then divided by 70 (or "y" multiplied by
2030	2030	20 0.429); and
2031	2031	21 (3) for taxable years ending after December
2032	2032	22 31, 2005:
2033	2033	23 (i) for property on which a bonus
2034	2034	24 depreciation deduction of 30% of the adjusted
2035	2035	25 basis was taken, "x" equals "y" multiplied by
2036	2036	26 30 and then divided by 70 (or "y" multiplied
2037	2037
2038	2038
2039	2039
2040	2040
2041	2041
2042	2042	HB1241 - 56 - LRB103 25002 HLH 51336 b
2043	2043
2044	2044
2045	2045	HB1241- 57 -LRB103 25002 HLH 51336 b HB1241 - 57 - LRB103 25002 HLH 51336 b
2046	2046	HB1241 - 57 - LRB103 25002 HLH 51336 b
2047	2047	1 by 0.429);
2048	2048	2 (ii) for property on which a bonus
2049	2049	3 depreciation deduction of 50% of the adjusted
2050	2050	4 basis was taken, "x" equals "y" multiplied by
2051	2051	5 1.0;
2052	2052	6 (iii) for property on which a bonus
2053	2053	7 depreciation deduction of 100% of the adjusted
2054	2054	8 basis was taken in a taxable year ending on or
2055	2055	9 after December 31, 2021, "x" equals the
2056	2056	10 depreciation deduction that would be allowed
2057	2057	11 on that property if the taxpayer had made the
2058	2058	12 election under Section 168(k)(7) of the
2059	2059	13 Internal Revenue Code to not claim bonus
2060	2060	14 depreciation on that property; and
2061	2061	15 (iv) for property on which a bonus
2062	2062	16 depreciation deduction of a percentage other
2063	2063	17 than 30%, 50% or 100% of the adjusted basis
2064	2064	18 was taken in a taxable year ending on or after
2065	2065	19 December 31, 2021, "x" equals "y" multiplied
2066	2066	20 by 100 times the percentage bonus depreciation
2067	2067	21 on the property (that is, 100(bonus%)) and
2068	2068	22 then divided by 100 times 1 minus the
2069	2069	23 percentage bonus depreciation on the property
2070	2070	24 (that is, 100(1bonus%)).
2071	2071	25 The aggregate amount deducted under this
2072	2072	26 subparagraph in all taxable years for any one piece of
2073	2073
2074	2074
2075	2075
2076	2076
2077	2077
2078	2078	HB1241 - 57 - LRB103 25002 HLH 51336 b
2079	2079
2080	2080
2081	2081	HB1241- 58 -LRB103 25002 HLH 51336 b HB1241 - 58 - LRB103 25002 HLH 51336 b
2082	2082	HB1241 - 58 - LRB103 25002 HLH 51336 b
2083	2083	1 property may not exceed the amount of the bonus
2084	2084	2 depreciation deduction taken on that property on the
2085	2085	3 taxpayer's federal income tax return under subsection
2086	2086	4 (k) of Section 168 of the Internal Revenue Code. This
2087	2087	5 subparagraph (T) is exempt from the provisions of
2088	2088	6 Section 250;
2089	2089	7 (U) If the taxpayer sells, transfers, abandons, or
2090	2090	8 otherwise disposes of property for which the taxpayer
2091	2091	9 was required in any taxable year to make an addition
2092	2092	10 modification under subparagraph (E-10), then an amount
2093	2093	11 equal to that addition modification.
2094	2094	12 If the taxpayer continues to own property through
2095	2095	13 the last day of the last tax year for which a
2096	2096	14 subtraction is allowed with respect to that property
2097	2097	15 under subparagraph (T) and for which the taxpayer was
2098	2098	16 required in any taxable year to make an addition
2099	2099	17 modification under subparagraph (E-10), then an amount
2100	2100	18 equal to that addition modification.
2101	2101	19 The taxpayer is allowed to take the deduction
2102	2102	20 under this subparagraph only once with respect to any
2103	2103	21 one piece of property.
2104	2104	22 This subparagraph (U) is exempt from the
2105	2105	23 provisions of Section 250;
2106	2106	24 (V) The amount of: (i) any interest income (net of
2107	2107	25 the deductions allocable thereto) taken into account
2108	2108	26 for the taxable year with respect to a transaction
2109	2109
2110	2110
2111	2111
2112	2112
2113	2113
2114	2114	HB1241 - 58 - LRB103 25002 HLH 51336 b
2115	2115
2116	2116
2117	2117	HB1241- 59 -LRB103 25002 HLH 51336 b HB1241 - 59 - LRB103 25002 HLH 51336 b
2118	2118	HB1241 - 59 - LRB103 25002 HLH 51336 b
2119	2119	1 with a taxpayer that is required to make an addition
2120	2120	2 modification with respect to such transaction under
2121	2121	3 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
2122	2122	4 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
2123	2123	5 the amount of such addition modification, (ii) any
2124	2124	6 income from intangible property (net of the deductions
2125	2125	7 allocable thereto) taken into account for the taxable
2126	2126	8 year with respect to a transaction with a taxpayer
2127	2127	9 that is required to make an addition modification with
2128	2128	10 respect to such transaction under Section
2129	2129	11 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
2130	2130	12 203(d)(2)(D-8), but not to exceed the amount of such
2131	2131	13 addition modification, and (iii) any insurance premium
2132	2132	14 income (net of deductions allocable thereto) taken
2133	2133	15 into account for the taxable year with respect to a
2134	2134	16 transaction with a taxpayer that is required to make
2135	2135	17 an addition modification with respect to such
2136	2136	18 transaction under Section 203(a)(2)(D-19), Section
2137	2137	19 203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section
2138	2138	20 203(d)(2)(D-9), but not to exceed the amount of that
2139	2139	21 addition modification. This subparagraph (V) is exempt
2140	2140	22 from the provisions of Section 250;
2141	2141	23 (W) An amount equal to the interest income taken
2142	2142	24 into account for the taxable year (net of the
2143	2143	25 deductions allocable thereto) with respect to
2144	2144	26 transactions with (i) a foreign person who would be a
2145	2145
2146	2146
2147	2147
2148	2148
2149	2149
2150	2150	HB1241 - 59 - LRB103 25002 HLH 51336 b
2151	2151
2152	2152
2153	2153	HB1241- 60 -LRB103 25002 HLH 51336 b HB1241 - 60 - LRB103 25002 HLH 51336 b
2154	2154	HB1241 - 60 - LRB103 25002 HLH 51336 b
2155	2155	1 member of the taxpayer's unitary business group but
2156	2156	2 for the fact that the foreign person's business
2157	2157	3 activity outside the United States is 80% or more of
2158	2158	4 that person's total business activity and (ii) for
2159	2159	5 taxable years ending on or after December 31, 2008, to
2160	2160	6 a person who would be a member of the same unitary
2161	2161	7 business group but for the fact that the person is
2162	2162	8 prohibited under Section 1501(a)(27) from being
2163	2163	9 included in the unitary business group because he or
2164	2164	10 she is ordinarily required to apportion business
2165	2165	11 income under different subsections of Section 304, but
2166	2166	12 not to exceed the addition modification required to be
2167	2167	13 made for the same taxable year under Section
2168	2168	14 203(b)(2)(E-12) for interest paid, accrued, or
2169	2169	15 incurred, directly or indirectly, to the same person.
2170	2170	16 This subparagraph (W) is exempt from the provisions of
2171	2171	17 Section 250;
2172	2172	18 (X) An amount equal to the income from intangible
2173	2173	19 property taken into account for the taxable year (net
2174	2174	20 of the deductions allocable thereto) with respect to
2175	2175	21 transactions with (i) a foreign person who would be a
2176	2176	22 member of the taxpayer's unitary business group but
2177	2177	23 for the fact that the foreign person's business
2178	2178	24 activity outside the United States is 80% or more of
2179	2179	25 that person's total business activity and (ii) for
2180	2180	26 taxable years ending on or after December 31, 2008, to
2181	2181
2182	2182
2183	2183
2184	2184
2185	2185
2186	2186	HB1241 - 60 - LRB103 25002 HLH 51336 b
2187	2187
2188	2188
2189	2189	HB1241- 61 -LRB103 25002 HLH 51336 b HB1241 - 61 - LRB103 25002 HLH 51336 b
2190	2190	HB1241 - 61 - LRB103 25002 HLH 51336 b
2191	2191	1 a person who would be a member of the same unitary
2192	2192	2 business group but for the fact that the person is
2193	2193	3 prohibited under Section 1501(a)(27) from being
2194	2194	4 included in the unitary business group because he or
2195	2195	5 she is ordinarily required to apportion business
2196	2196	6 income under different subsections of Section 304, but
2197	2197	7 not to exceed the addition modification required to be
2198	2198	8 made for the same taxable year under Section
2199	2199	9 203(b)(2)(E-13) for intangible expenses and costs
2200	2200	10 paid, accrued, or incurred, directly or indirectly, to
2201	2201	11 the same foreign person. This subparagraph (X) is
2202	2202	12 exempt from the provisions of Section 250;
2203	2203	13 (Y) For taxable years ending on or after December
2204	2204	14 31, 2011, in the case of a taxpayer who was required to
2205	2205	15 add back any insurance premiums under Section
2206	2206	16 203(b)(2)(E-14), such taxpayer may elect to subtract
2207	2207	17 that part of a reimbursement received from the
2208	2208	18 insurance company equal to the amount of the expense
2209	2209	19 or loss (including expenses incurred by the insurance
2210	2210	20 company) that would have been taken into account as a
2211	2211	21 deduction for federal income tax purposes if the
2212	2212	22 expense or loss had been uninsured. If a taxpayer
2213	2213	23 makes the election provided for by this subparagraph
2214	2214	24 (Y), the insurer to which the premiums were paid must
2215	2215	25 add back to income the amount subtracted by the
2216	2216	26 taxpayer pursuant to this subparagraph (Y). This
2217	2217
2218	2218
2219	2219
2220	2220
2221	2221
2222	2222	HB1241 - 61 - LRB103 25002 HLH 51336 b
2223	2223
2224	2224
2225	2225	HB1241- 62 -LRB103 25002 HLH 51336 b HB1241 - 62 - LRB103 25002 HLH 51336 b
2226	2226	HB1241 - 62 - LRB103 25002 HLH 51336 b
2227	2227	1 subparagraph (Y) is exempt from the provisions of
2228	2228	2 Section 250; and
2229	2229	3 (Z) The difference between the nondeductible
2230	2230	4 controlled foreign corporation dividends under Section
2231	2231	5 965(e)(3) of the Internal Revenue Code over the
2232	2232	6 taxable income of the taxpayer, computed without
2233	2233	7 regard to Section 965(e)(2)(A) of the Internal Revenue
2234	2234	8 Code, and without regard to any net operating loss
2235	2235	9 deduction. This subparagraph (Z) is exempt from the
2236	2236	10 provisions of Section 250.
2237	2237	11 (3) Special rule. For purposes of paragraph (2)(A),
2238	2238	12 "gross income" in the case of a life insurance company,
2239	2239	13 for tax years ending on and after December 31, 1994, and
2240	2240	14 prior to December 31, 2011, shall mean the gross
2241	2241	15 investment income for the taxable year and, for tax years
2242	2242	16 ending on or after December 31, 2011, shall mean all
2243	2243	17 amounts included in life insurance gross income under
2244	2244	18 Section 803(a)(3) of the Internal Revenue Code.
2245	2245	19 (c) Trusts and estates.
2246	2246	20 (1) In general. In the case of a trust or estate, base
2247	2247	21 income means an amount equal to the taxpayer's taxable
2248	2248	22 income for the taxable year as modified by paragraph (2).
2249	2249	23 (2) Modifications. Subject to the provisions of
2250	2250	24 paragraph (3), the taxable income referred to in paragraph
2251	2251	25 (1) shall be modified by adding thereto the sum of the
2252	2252
2253	2253
2254	2254
2255	2255
2256	2256
2257	2257	HB1241 - 62 - LRB103 25002 HLH 51336 b
2258	2258
2259	2259
2260	2260	HB1241- 63 -LRB103 25002 HLH 51336 b HB1241 - 63 - LRB103 25002 HLH 51336 b
2261	2261	HB1241 - 63 - LRB103 25002 HLH 51336 b
2262	2262	1 following amounts:
2263	2263	2 (A) An amount equal to all amounts paid or accrued
2264	2264	3 to the taxpayer as interest or dividends during the
2265	2265	4 taxable year to the extent excluded from gross income
2266	2266	5 in the computation of taxable income;
2267	2267	6 (B) In the case of (i) an estate, $600; (ii) a
2268	2268	7 trust which, under its governing instrument, is
2269	2269	8 required to distribute all of its income currently,
2270	2270	9 $300; and (iii) any other trust, $100, but in each such
2271	2271	10 case, only to the extent such amount was deducted in
2272	2272	11 the computation of taxable income;
2273	2273	12 (C) An amount equal to the amount of tax imposed by
2274	2274	13 this Act to the extent deducted from gross income in
2275	2275	14 the computation of taxable income for the taxable
2276	2276	15 year;
2277	2277	16 (D) The amount of any net operating loss deduction
2278	2278	17 taken in arriving at taxable income, other than a net
2279	2279	18 operating loss carried forward from a taxable year
2280	2280	19 ending prior to December 31, 1986;
2281	2281	20 (E) For taxable years in which a net operating
2282	2282	21 loss carryback or carryforward from a taxable year
2283	2283	22 ending prior to December 31, 1986 is an element of
2284	2284	23 taxable income under paragraph (1) of subsection (e)
2285	2285	24 or subparagraph (E) of paragraph (2) of subsection
2286	2286	25 (e), the amount by which addition modifications other
2287	2287	26 than those provided by this subparagraph (E) exceeded
2288	2288
2289	2289
2290	2290
2291	2291
2292	2292
2293	2293	HB1241 - 63 - LRB103 25002 HLH 51336 b
2294	2294
2295	2295
2296	2296	HB1241- 64 -LRB103 25002 HLH 51336 b HB1241 - 64 - LRB103 25002 HLH 51336 b
2297	2297	HB1241 - 64 - LRB103 25002 HLH 51336 b
2298	2298	1 subtraction modifications in such taxable year, with
2299	2299	2 the following limitations applied in the order that
2300	2300	3 they are listed:
2301	2301	4 (i) the addition modification relating to the
2302	2302	5 net operating loss carried back or forward to the
2303	2303	6 taxable year from any taxable year ending prior to
2304	2304	7 December 31, 1986 shall be reduced by the amount
2305	2305	8 of addition modification under this subparagraph
2306	2306	9 (E) which related to that net operating loss and
2307	2307	10 which was taken into account in calculating the
2308	2308	11 base income of an earlier taxable year, and
2309	2309	12 (ii) the addition modification relating to the
2310	2310	13 net operating loss carried back or forward to the
2311	2311	14 taxable year from any taxable year ending prior to
2312	2312	15 December 31, 1986 shall not exceed the amount of
2313	2313	16 such carryback or carryforward;
2314	2314	17 For taxable years in which there is a net
2315	2315	18 operating loss carryback or carryforward from more
2316	2316	19 than one other taxable year ending prior to December
2317	2317	20 31, 1986, the addition modification provided in this
2318	2318	21 subparagraph (E) shall be the sum of the amounts
2319	2319	22 computed independently under the preceding provisions
2320	2320	23 of this subparagraph (E) for each such taxable year;
2321	2321	24 (F) For taxable years ending on or after January
2322	2322	25 1, 1989, an amount equal to the tax deducted pursuant
2323	2323	26 to Section 164 of the Internal Revenue Code if the
2324	2324
2325	2325
2326	2326
2327	2327
2328	2328
2329	2329	HB1241 - 64 - LRB103 25002 HLH 51336 b
2330	2330
2331	2331
2332	2332	HB1241- 65 -LRB103 25002 HLH 51336 b HB1241 - 65 - LRB103 25002 HLH 51336 b
2333	2333	HB1241 - 65 - LRB103 25002 HLH 51336 b
2334	2334	1 trust or estate is claiming the same tax for purposes
2335	2335	2 of the Illinois foreign tax credit under Section 601
2336	2336	3 of this Act;
2337	2337	4 (G) An amount equal to the amount of the capital
2338	2338	5 gain deduction allowable under the Internal Revenue
2339	2339	6 Code, to the extent deducted from gross income in the
2340	2340	7 computation of taxable income;
2341	2341	8 (G-5) For taxable years ending after December 31,
2342	2342	9 1997, an amount equal to any eligible remediation
2343	2343	10 costs that the trust or estate deducted in computing
2344	2344	11 adjusted gross income and for which the trust or
2345	2345	12 estate claims a credit under subsection (l) of Section
2346	2346	13 201;
2347	2347	14 (G-10) For taxable years 2001 and thereafter, an
2348	2348	15 amount equal to the bonus depreciation deduction taken
2349	2349	16 on the taxpayer's federal income tax return for the
2350	2350	17 taxable year under subsection (k) of Section 168 of
2351	2351	18 the Internal Revenue Code; and
2352	2352	19 (G-11) If the taxpayer sells, transfers, abandons,
2353	2353	20 or otherwise disposes of property for which the
2354	2354	21 taxpayer was required in any taxable year to make an
2355	2355	22 addition modification under subparagraph (G-10), then
2356	2356	23 an amount equal to the aggregate amount of the
2357	2357	24 deductions taken in all taxable years under
2358	2358	25 subparagraph (R) with respect to that property.
2359	2359	26 If the taxpayer continues to own property through
2360	2360
2361	2361
2362	2362
2363	2363
2364	2364
2365	2365	HB1241 - 65 - LRB103 25002 HLH 51336 b
2366	2366
2367	2367
2368	2368	HB1241- 66 -LRB103 25002 HLH 51336 b HB1241 - 66 - LRB103 25002 HLH 51336 b
2369	2369	HB1241 - 66 - LRB103 25002 HLH 51336 b
2370	2370	1 the last day of the last tax year for which a
2371	2371	2 subtraction is allowed with respect to that property
2372	2372	3 under subparagraph (R) and for which the taxpayer was
2373	2373	4 allowed in any taxable year to make a subtraction
2374	2374	5 modification under subparagraph (R), then an amount
2375	2375	6 equal to that subtraction modification.
2376	2376	7 The taxpayer is required to make the addition
2377	2377	8 modification under this subparagraph only once with
2378	2378	9 respect to any one piece of property;
2379	2379	10 (G-12) An amount equal to the amount otherwise
2380	2380	11 allowed as a deduction in computing base income for
2381	2381	12 interest paid, accrued, or incurred, directly or
2382	2382	13 indirectly, (i) for taxable years ending on or after
2383	2383	14 December 31, 2004, to a foreign person who would be a
2384	2384	15 member of the same unitary business group but for the
2385	2385	16 fact that the foreign person's business activity
2386	2386	17 outside the United States is 80% or more of the foreign
2387	2387	18 person's total business activity and (ii) for taxable
2388	2388	19 years ending on or after December 31, 2008, to a person
2389	2389	20 who would be a member of the same unitary business
2390	2390	21 group but for the fact that the person is prohibited
2391	2391	22 under Section 1501(a)(27) from being included in the
2392	2392	23 unitary business group because he or she is ordinarily
2393	2393	24 required to apportion business income under different
2394	2394	25 subsections of Section 304. The addition modification
2395	2395	26 required by this subparagraph shall be reduced to the
2396	2396
2397	2397
2398	2398
2399	2399
2400	2400
2401	2401	HB1241 - 66 - LRB103 25002 HLH 51336 b
2402	2402
2403	2403
2404	2404	HB1241- 67 -LRB103 25002 HLH 51336 b HB1241 - 67 - LRB103 25002 HLH 51336 b
2405	2405	HB1241 - 67 - LRB103 25002 HLH 51336 b
2406	2406	1 extent that dividends were included in base income of
2407	2407	2 the unitary group for the same taxable year and
2408	2408	3 received by the taxpayer or by a member of the
2409	2409	4 taxpayer's unitary business group (including amounts
2410	2410	5 included in gross income pursuant to Sections 951
2411	2411	6 through 964 of the Internal Revenue Code and amounts
2412	2412	7 included in gross income under Section 78 of the
2413	2413	8 Internal Revenue Code) with respect to the stock of
2414	2414	9 the same person to whom the interest was paid,
2415	2415	10 accrued, or incurred.
2416	2416	11 This paragraph shall not apply to the following:
2417	2417	12 (i) an item of interest paid, accrued, or
2418	2418	13 incurred, directly or indirectly, to a person who
2419	2419	14 is subject in a foreign country or state, other
2420	2420	15 than a state which requires mandatory unitary
2421	2421	16 reporting, to a tax on or measured by net income
2422	2422	17 with respect to such interest; or
2423	2423	18 (ii) an item of interest paid, accrued, or
2424	2424	19 incurred, directly or indirectly, to a person if
2425	2425	20 the taxpayer can establish, based on a
2426	2426	21 preponderance of the evidence, both of the
2427	2427	22 following:
2428	2428	23 (a) the person, during the same taxable
2429	2429	24 year, paid, accrued, or incurred, the interest
2430	2430	25 to a person that is not a related member, and
2431	2431	26 (b) the transaction giving rise to the
2432	2432
2433	2433
2434	2434
2435	2435
2436	2436
2437	2437	HB1241 - 67 - LRB103 25002 HLH 51336 b
2438	2438
2439	2439
2440	2440	HB1241- 68 -LRB103 25002 HLH 51336 b HB1241 - 68 - LRB103 25002 HLH 51336 b
2441	2441	HB1241 - 68 - LRB103 25002 HLH 51336 b
2442	2442	1 interest expense between the taxpayer and the
2443	2443	2 person did not have as a principal purpose the
2444	2444	3 avoidance of Illinois income tax, and is paid
2445	2445	4 pursuant to a contract or agreement that
2446	2446	5 reflects an arm's-length interest rate and
2447	2447	6 terms; or
2448	2448	7 (iii) the taxpayer can establish, based on
2449	2449	8 clear and convincing evidence, that the interest
2450	2450	9 paid, accrued, or incurred relates to a contract
2451	2451	10 or agreement entered into at arm's-length rates
2452	2452	11 and terms and the principal purpose for the
2453	2453	12 payment is not federal or Illinois tax avoidance;
2454	2454	13 or
2455	2455	14 (iv) an item of interest paid, accrued, or
2456	2456	15 incurred, directly or indirectly, to a person if
2457	2457	16 the taxpayer establishes by clear and convincing
2458	2458	17 evidence that the adjustments are unreasonable; or
2459	2459	18 if the taxpayer and the Director agree in writing
2460	2460	19 to the application or use of an alternative method
2461	2461	20 of apportionment under Section 304(f).
2462	2462	21 Nothing in this subsection shall preclude the
2463	2463	22 Director from making any other adjustment
2464	2464	23 otherwise allowed under Section 404 of this Act
2465	2465	24 for any tax year beginning after the effective
2466	2466	25 date of this amendment provided such adjustment is
2467	2467	26 made pursuant to regulation adopted by the
2468	2468
2469	2469
2470	2470
2471	2471
2472	2472
2473	2473	HB1241 - 68 - LRB103 25002 HLH 51336 b
2474	2474
2475	2475
2476	2476	HB1241- 69 -LRB103 25002 HLH 51336 b HB1241 - 69 - LRB103 25002 HLH 51336 b
2477	2477	HB1241 - 69 - LRB103 25002 HLH 51336 b
2478	2478	1 Department and such regulations provide methods
2479	2479	2 and standards by which the Department will utilize
2480	2480	3 its authority under Section 404 of this Act;
2481	2481	4 (G-13) An amount equal to the amount of intangible
2482	2482	5 expenses and costs otherwise allowed as a deduction in
2483	2483	6 computing base income, and that were paid, accrued, or
2484	2484	7 incurred, directly or indirectly, (i) for taxable
2485	2485	8 years ending on or after December 31, 2004, to a
2486	2486	9 foreign person who would be a member of the same
2487	2487	10 unitary business group but for the fact that the
2488	2488	11 foreign person's business activity outside the United
2489	2489	12 States is 80% or more of that person's total business
2490	2490	13 activity and (ii) for taxable years ending on or after
2491	2491	14 December 31, 2008, to a person who would be a member of
2492	2492	15 the same unitary business group but for the fact that
2493	2493	16 the person is prohibited under Section 1501(a)(27)
2494	2494	17 from being included in the unitary business group
2495	2495	18 because he or she is ordinarily required to apportion
2496	2496	19 business income under different subsections of Section
2497	2497	20 304. The addition modification required by this
2498	2498	21 subparagraph shall be reduced to the extent that
2499	2499	22 dividends were included in base income of the unitary
2500	2500	23 group for the same taxable year and received by the
2501	2501	24 taxpayer or by a member of the taxpayer's unitary
2502	2502	25 business group (including amounts included in gross
2503	2503	26 income pursuant to Sections 951 through 964 of the
2504	2504
2505	2505
2506	2506
2507	2507
2508	2508
2509	2509	HB1241 - 69 - LRB103 25002 HLH 51336 b
2510	2510
2511	2511
2512	2512	HB1241- 70 -LRB103 25002 HLH 51336 b HB1241 - 70 - LRB103 25002 HLH 51336 b
2513	2513	HB1241 - 70 - LRB103 25002 HLH 51336 b
2514	2514	1 Internal Revenue Code and amounts included in gross
2515	2515	2 income under Section 78 of the Internal Revenue Code)
2516	2516	3 with respect to the stock of the same person to whom
2517	2517	4 the intangible expenses and costs were directly or
2518	2518	5 indirectly paid, incurred, or accrued. The preceding
2519	2519	6 sentence shall not apply to the extent that the same
2520	2520	7 dividends caused a reduction to the addition
2521	2521	8 modification required under Section 203(c)(2)(G-12) of
2522	2522	9 this Act. As used in this subparagraph, the term
2523	2523	10 "intangible expenses and costs" includes: (1)
2524	2524	11 expenses, losses, and costs for or related to the
2525	2525	12 direct or indirect acquisition, use, maintenance or
2526	2526	13 management, ownership, sale, exchange, or any other
2527	2527	14 disposition of intangible property; (2) losses
2528	2528	15 incurred, directly or indirectly, from factoring
2529	2529	16 transactions or discounting transactions; (3) royalty,
2530	2530	17 patent, technical, and copyright fees; (4) licensing
2531	2531	18 fees; and (5) other similar expenses and costs. For
2532	2532	19 purposes of this subparagraph, "intangible property"
2533	2533	20 includes patents, patent applications, trade names,
2534	2534	21 trademarks, service marks, copyrights, mask works,
2535	2535	22 trade secrets, and similar types of intangible assets.
2536	2536	23 This paragraph shall not apply to the following:
2537	2537	24 (i) any item of intangible expenses or costs
2538	2538	25 paid, accrued, or incurred, directly or
2539	2539	26 indirectly, from a transaction with a person who
2540	2540
2541	2541
2542	2542
2543	2543
2544	2544
2545	2545	HB1241 - 70 - LRB103 25002 HLH 51336 b
2546	2546
2547	2547
2548	2548	HB1241- 71 -LRB103 25002 HLH 51336 b HB1241 - 71 - LRB103 25002 HLH 51336 b
2549	2549	HB1241 - 71 - LRB103 25002 HLH 51336 b
2550	2550	1 is subject in a foreign country or state, other
2551	2551	2 than a state which requires mandatory unitary
2552	2552	3 reporting, to a tax on or measured by net income
2553	2553	4 with respect to such item; or
2554	2554	5 (ii) any item of intangible expense or cost
2555	2555	6 paid, accrued, or incurred, directly or
2556	2556	7 indirectly, if the taxpayer can establish, based
2557	2557	8 on a preponderance of the evidence, both of the
2558	2558	9 following:
2559	2559	10 (a) the person during the same taxable
2560	2560	11 year paid, accrued, or incurred, the
2561	2561	12 intangible expense or cost to a person that is
2562	2562	13 not a related member, and
2563	2563	14 (b) the transaction giving rise to the
2564	2564	15 intangible expense or cost between the
2565	2565	16 taxpayer and the person did not have as a
2566	2566	17 principal purpose the avoidance of Illinois
2567	2567	18 income tax, and is paid pursuant to a contract
2568	2568	19 or agreement that reflects arm's-length terms;
2569	2569	20 or
2570	2570	21 (iii) any item of intangible expense or cost
2571	2571	22 paid, accrued, or incurred, directly or
2572	2572	23 indirectly, from a transaction with a person if
2573	2573	24 the taxpayer establishes by clear and convincing
2574	2574	25 evidence, that the adjustments are unreasonable;
2575	2575	26 or if the taxpayer and the Director agree in
2576	2576
2577	2577
2578	2578
2579	2579
2580	2580
2581	2581	HB1241 - 71 - LRB103 25002 HLH 51336 b
2582	2582
2583	2583
2584	2584	HB1241- 72 -LRB103 25002 HLH 51336 b HB1241 - 72 - LRB103 25002 HLH 51336 b
2585	2585	HB1241 - 72 - LRB103 25002 HLH 51336 b
2586	2586	1 writing to the application or use of an
2587	2587	2 alternative method of apportionment under Section
2588	2588	3 304(f);
2589	2589	4 Nothing in this subsection shall preclude the
2590	2590	5 Director from making any other adjustment
2591	2591	6 otherwise allowed under Section 404 of this Act
2592	2592	7 for any tax year beginning after the effective
2593	2593	8 date of this amendment provided such adjustment is
2594	2594	9 made pursuant to regulation adopted by the
2595	2595	10 Department and such regulations provide methods
2596	2596	11 and standards by which the Department will utilize
2597	2597	12 its authority under Section 404 of this Act;
2598	2598	13 (G-14) For taxable years ending on or after
2599	2599	14 December 31, 2008, an amount equal to the amount of
2600	2600	15 insurance premium expenses and costs otherwise allowed
2601	2601	16 as a deduction in computing base income, and that were
2602	2602	17 paid, accrued, or incurred, directly or indirectly, to
2603	2603	18 a person who would be a member of the same unitary
2604	2604	19 business group but for the fact that the person is
2605	2605	20 prohibited under Section 1501(a)(27) from being
2606	2606	21 included in the unitary business group because he or
2607	2607	22 she is ordinarily required to apportion business
2608	2608	23 income under different subsections of Section 304. The
2609	2609	24 addition modification required by this subparagraph
2610	2610	25 shall be reduced to the extent that dividends were
2611	2611	26 included in base income of the unitary group for the
2612	2612
2613	2613
2614	2614
2615	2615
2616	2616
2617	2617	HB1241 - 72 - LRB103 25002 HLH 51336 b
2618	2618
2619	2619
2620	2620	HB1241- 73 -LRB103 25002 HLH 51336 b HB1241 - 73 - LRB103 25002 HLH 51336 b
2621	2621	HB1241 - 73 - LRB103 25002 HLH 51336 b
2622	2622	1 same taxable year and received by the taxpayer or by a
2623	2623	2 member of the taxpayer's unitary business group
2624	2624	3 (including amounts included in gross income under
2625	2625	4 Sections 951 through 964 of the Internal Revenue Code
2626	2626	5 and amounts included in gross income under Section 78
2627	2627	6 of the Internal Revenue Code) with respect to the
2628	2628	7 stock of the same person to whom the premiums and costs
2629	2629	8 were directly or indirectly paid, incurred, or
2630	2630	9 accrued. The preceding sentence does not apply to the
2631	2631	10 extent that the same dividends caused a reduction to
2632	2632	11 the addition modification required under Section
2633	2633	12 203(c)(2)(G-12) or Section 203(c)(2)(G-13) of this
2634	2634	13 Act;
2635	2635	14 (G-15) An amount equal to the credit allowable to
2636	2636	15 the taxpayer under Section 218(a) of this Act,
2637	2637	16 determined without regard to Section 218(c) of this
2638	2638	17 Act;
2639	2639	18 (G-16) For taxable years ending on or after
2640	2640	19 December 31, 2017, an amount equal to the deduction
2641	2641	20 allowed under Section 199 of the Internal Revenue Code
2642	2642	21 for the taxable year;
2643	2643	22 (G-17) the amount that is claimed as a federal
2644	2644	23 deduction when computing the taxpayer's federal
2645	2645	24 taxable income for the taxable year and that is
2646	2646	25 attributable to an endowment gift for which the
2647	2647	26 taxpayer receives a credit under the Endow Illinois
2648	2648
2649	2649
2650	2650
2651	2651
2652	2652
2653	2653	HB1241 - 73 - LRB103 25002 HLH 51336 b
2654	2654
2655	2655
2656	2656	HB1241- 74 -LRB103 25002 HLH 51336 b HB1241 - 74 - LRB103 25002 HLH 51336 b
2657	2657	HB1241 - 74 - LRB103 25002 HLH 51336 b
2658	2658	1 Tax Credit Act;
2659	2659	2 and by deducting from the total so obtained the sum of the
2660	2660	3 following amounts:
2661	2661	4 (H) An amount equal to all amounts included in
2662	2662	5 such total pursuant to the provisions of Sections
2663	2663	6 402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and 408
2664	2664	7 of the Internal Revenue Code or included in such total
2665	2665	8 as distributions under the provisions of any
2666	2666	9 retirement or disability plan for employees of any
2667	2667	10 governmental agency or unit, or retirement payments to
2668	2668	11 retired partners, which payments are excluded in
2669	2669	12 computing net earnings from self employment by Section
2670	2670	13 1402 of the Internal Revenue Code and regulations
2671	2671	14 adopted pursuant thereto;
2672	2672	15 (I) The valuation limitation amount;
2673	2673	16 (J) An amount equal to the amount of any tax
2674	2674	17 imposed by this Act which was refunded to the taxpayer
2675	2675	18 and included in such total for the taxable year;
2676	2676	19 (K) An amount equal to all amounts included in
2677	2677	20 taxable income as modified by subparagraphs (A), (B),
2678	2678	21 (C), (D), (E), (F) and (G) which are exempt from
2679	2679	22 taxation by this State either by reason of its
2680	2680	23 statutes or Constitution or by reason of the
2681	2681	24 Constitution, treaties or statutes of the United
2682	2682	25 States; provided that, in the case of any statute of
2683	2683	26 this State that exempts income derived from bonds or
2684	2684
2685	2685
2686	2686
2687	2687
2688	2688
2689	2689	HB1241 - 74 - LRB103 25002 HLH 51336 b
2690	2690
2691	2691
2692	2692	HB1241- 75 -LRB103 25002 HLH 51336 b HB1241 - 75 - LRB103 25002 HLH 51336 b
2693	2693	HB1241 - 75 - LRB103 25002 HLH 51336 b
2694	2694	1 other obligations from the tax imposed under this Act,
2695	2695	2 the amount exempted shall be the interest net of bond
2696	2696	3 premium amortization;
2697	2697	4 (L) With the exception of any amounts subtracted
2698	2698	5 under subparagraph (K), an amount equal to the sum of
2699	2699	6 all amounts disallowed as deductions by (i) Sections
2700	2700	7 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
2701	2701	8 and all amounts of expenses allocable to interest and
2702	2702	9 disallowed as deductions by Section 265(a)(1) of the
2703	2703	10 Internal Revenue Code; and (ii) for taxable years
2704	2704	11 ending on or after August 13, 1999, Sections
2705	2705	12 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
2706	2706	13 Internal Revenue Code, plus, (iii) for taxable years
2707	2707	14 ending on or after December 31, 2011, Section
2708	2708	15 45G(e)(3) of the Internal Revenue Code and, for
2709	2709	16 taxable years ending on or after December 31, 2008,
2710	2710	17 any amount included in gross income under Section 87
2711	2711	18 of the Internal Revenue Code; the provisions of this
2712	2712	19 subparagraph are exempt from the provisions of Section
2713	2713	20 250;
2714	2714	21 (M) An amount equal to those dividends included in
2715	2715	22 such total which were paid by a corporation which
2716	2716	23 conducts business operations in a River Edge
2717	2717	24 Redevelopment Zone or zones created under the River
2718	2718	25 Edge Redevelopment Zone Act and conducts substantially
2719	2719	26 all of its operations in a River Edge Redevelopment
2720	2720
2721	2721
2722	2722
2723	2723
2724	2724
2725	2725	HB1241 - 75 - LRB103 25002 HLH 51336 b
2726	2726
2727	2727
2728	2728	HB1241- 76 -LRB103 25002 HLH 51336 b HB1241 - 76 - LRB103 25002 HLH 51336 b
2729	2729	HB1241 - 76 - LRB103 25002 HLH 51336 b
2730	2730	1 Zone or zones. This subparagraph (M) is exempt from
2731	2731	2 the provisions of Section 250;
2732	2732	3 (N) An amount equal to any contribution made to a
2733	2733	4 job training project established pursuant to the Tax
2734	2734	5 Increment Allocation Redevelopment Act;
2735	2735	6 (O) An amount equal to those dividends included in
2736	2736	7 such total that were paid by a corporation that
2737	2737	8 conducts business operations in a federally designated
2738	2738	9 Foreign Trade Zone or Sub-Zone and that is designated
2739	2739	10 a High Impact Business located in Illinois; provided
2740	2740	11 that dividends eligible for the deduction provided in
2741	2741	12 subparagraph (M) of paragraph (2) of this subsection
2742	2742	13 shall not be eligible for the deduction provided under
2743	2743	14 this subparagraph (O);
2744	2744	15 (P) An amount equal to the amount of the deduction
2745	2745	16 used to compute the federal income tax credit for
2746	2746	17 restoration of substantial amounts held under claim of
2747	2747	18 right for the taxable year pursuant to Section 1341 of
2748	2748	19 the Internal Revenue Code;
2749	2749	20 (Q) For taxable year 1999 and thereafter, an
2750	2750	21 amount equal to the amount of any (i) distributions,
2751	2751	22 to the extent includible in gross income for federal
2752	2752	23 income tax purposes, made to the taxpayer because of
2753	2753	24 his or her status as a victim of persecution for racial
2754	2754	25 or religious reasons by Nazi Germany or any other Axis
2755	2755	26 regime or as an heir of the victim and (ii) items of
2756	2756
2757	2757
2758	2758
2759	2759
2760	2760
2761	2761	HB1241 - 76 - LRB103 25002 HLH 51336 b
2762	2762
2763	2763
2764	2764	HB1241- 77 -LRB103 25002 HLH 51336 b HB1241 - 77 - LRB103 25002 HLH 51336 b
2765	2765	HB1241 - 77 - LRB103 25002 HLH 51336 b
2766	2766	1 income, to the extent includible in gross income for
2767	2767	2 federal income tax purposes, attributable to, derived
2768	2768	3 from or in any way related to assets stolen from,
2769	2769	4 hidden from, or otherwise lost to a victim of
2770	2770	5 persecution for racial or religious reasons by Nazi
2771	2771	6 Germany or any other Axis regime immediately prior to,
2772	2772	7 during, and immediately after World War II, including,
2773	2773	8 but not limited to, interest on the proceeds
2774	2774	9 receivable as insurance under policies issued to a
2775	2775	10 victim of persecution for racial or religious reasons
2776	2776	11 by Nazi Germany or any other Axis regime by European
2777	2777	12 insurance companies immediately prior to and during
2778	2778	13 World War II; provided, however, this subtraction from
2779	2779	14 federal adjusted gross income does not apply to assets
2780	2780	15 acquired with such assets or with the proceeds from
2781	2781	16 the sale of such assets; provided, further, this
2782	2782	17 paragraph shall only apply to a taxpayer who was the
2783	2783	18 first recipient of such assets after their recovery
2784	2784	19 and who is a victim of persecution for racial or
2785	2785	20 religious reasons by Nazi Germany or any other Axis
2786	2786	21 regime or as an heir of the victim. The amount of and
2787	2787	22 the eligibility for any public assistance, benefit, or
2788	2788	23 similar entitlement is not affected by the inclusion
2789	2789	24 of items (i) and (ii) of this paragraph in gross income
2790	2790	25 for federal income tax purposes. This paragraph is
2791	2791	26 exempt from the provisions of Section 250;
2792	2792
2793	2793
2794	2794
2795	2795
2796	2796
2797	2797	HB1241 - 77 - LRB103 25002 HLH 51336 b
2798	2798
2799	2799
2800	2800	HB1241- 78 -LRB103 25002 HLH 51336 b HB1241 - 78 - LRB103 25002 HLH 51336 b
2801	2801	HB1241 - 78 - LRB103 25002 HLH 51336 b
2802	2802	1 (R) For taxable years 2001 and thereafter, for the
2803	2803	2 taxable year in which the bonus depreciation deduction
2804	2804	3 is taken on the taxpayer's federal income tax return
2805	2805	4 under subsection (k) of Section 168 of the Internal
2806	2806	5 Revenue Code and for each applicable taxable year
2807	2807	6 thereafter, an amount equal to "x", where:
2808	2808	7 (1) "y" equals the amount of the depreciation
2809	2809	8 deduction taken for the taxable year on the
2810	2810	9 taxpayer's federal income tax return on property
2811	2811	10 for which the bonus depreciation deduction was
2812	2812	11 taken in any year under subsection (k) of Section
2813	2813	12 168 of the Internal Revenue Code, but not
2814	2814	13 including the bonus depreciation deduction;
2815	2815	14 (2) for taxable years ending on or before
2816	2816	15 December 31, 2005, "x" equals "y" multiplied by 30
2817	2817	16 and then divided by 70 (or "y" multiplied by
2818	2818	17 0.429); and
2819	2819	18 (3) for taxable years ending after December
2820	2820	19 31, 2005:
2821	2821	20 (i) for property on which a bonus
2822	2822	21 depreciation deduction of 30% of the adjusted
2823	2823	22 basis was taken, "x" equals "y" multiplied by
2824	2824	23 30 and then divided by 70 (or "y" multiplied
2825	2825	24 by 0.429);
2826	2826	25 (ii) for property on which a bonus
2827	2827	26 depreciation deduction of 50% of the adjusted
2828	2828
2829	2829
2830	2830
2831	2831
2832	2832
2833	2833	HB1241 - 78 - LRB103 25002 HLH 51336 b
2834	2834
2835	2835
2836	2836	HB1241- 79 -LRB103 25002 HLH 51336 b HB1241 - 79 - LRB103 25002 HLH 51336 b
2837	2837	HB1241 - 79 - LRB103 25002 HLH 51336 b
2838	2838	1 basis was taken, "x" equals "y" multiplied by
2839	2839	2 1.0;
2840	2840	3 (iii) for property on which a bonus
2841	2841	4 depreciation deduction of 100% of the adjusted
2842	2842	5 basis was taken in a taxable year ending on or
2843	2843	6 after December 31, 2021, "x" equals the
2844	2844	7 depreciation deduction that would be allowed
2845	2845	8 on that property if the taxpayer had made the
2846	2846	9 election under Section 168(k)(7) of the
2847	2847	10 Internal Revenue Code to not claim bonus
2848	2848	11 depreciation on that property; and
2849	2849	12 (iv) for property on which a bonus
2850	2850	13 depreciation deduction of a percentage other
2851	2851	14 than 30%, 50% or 100% of the adjusted basis
2852	2852	15 was taken in a taxable year ending on or after
2853	2853	16 December 31, 2021, "x" equals "y" multiplied
2854	2854	17 by 100 times the percentage bonus depreciation
2855	2855	18 on the property (that is, 100(bonus%)) and
2856	2856	19 then divided by 100 times 1 minus the
2857	2857	20 percentage bonus depreciation on the property
2858	2858	21 (that is, 100(1bonus%)).
2859	2859	22 The aggregate amount deducted under this
2860	2860	23 subparagraph in all taxable years for any one piece of
2861	2861	24 property may not exceed the amount of the bonus
2862	2862	25 depreciation deduction taken on that property on the
2863	2863	26 taxpayer's federal income tax return under subsection
2864	2864
2865	2865
2866	2866
2867	2867
2868	2868
2869	2869	HB1241 - 79 - LRB103 25002 HLH 51336 b
2870	2870
2871	2871
2872	2872	HB1241- 80 -LRB103 25002 HLH 51336 b HB1241 - 80 - LRB103 25002 HLH 51336 b
2873	2873	HB1241 - 80 - LRB103 25002 HLH 51336 b
2874	2874	1 (k) of Section 168 of the Internal Revenue Code. This
2875	2875	2 subparagraph (R) is exempt from the provisions of
2876	2876	3 Section 250;
2877	2877	4 (S) If the taxpayer sells, transfers, abandons, or
2878	2878	5 otherwise disposes of property for which the taxpayer
2879	2879	6 was required in any taxable year to make an addition
2880	2880	7 modification under subparagraph (G-10), then an amount
2881	2881	8 equal to that addition modification.
2882	2882	9 If the taxpayer continues to own property through
2883	2883	10 the last day of the last tax year for which a
2884	2884	11 subtraction is allowed with respect to that property
2885	2885	12 under subparagraph (R) and for which the taxpayer was
2886	2886	13 required in any taxable year to make an addition
2887	2887	14 modification under subparagraph (G-10), then an amount
2888	2888	15 equal to that addition modification.
2889	2889	16 The taxpayer is allowed to take the deduction
2890	2890	17 under this subparagraph only once with respect to any
2891	2891	18 one piece of property.
2892	2892	19 This subparagraph (S) is exempt from the
2893	2893	20 provisions of Section 250;
2894	2894	21 (T) The amount of (i) any interest income (net of
2895	2895	22 the deductions allocable thereto) taken into account
2896	2896	23 for the taxable year with respect to a transaction
2897	2897	24 with a taxpayer that is required to make an addition
2898	2898	25 modification with respect to such transaction under
2899	2899	26 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
2900	2900
2901	2901
2902	2902
2903	2903
2904	2904
2905	2905	HB1241 - 80 - LRB103 25002 HLH 51336 b
2906	2906
2907	2907
2908	2908	HB1241- 81 -LRB103 25002 HLH 51336 b HB1241 - 81 - LRB103 25002 HLH 51336 b
2909	2909	HB1241 - 81 - LRB103 25002 HLH 51336 b
2910	2910	1 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
2911	2911	2 the amount of such addition modification and (ii) any
2912	2912	3 income from intangible property (net of the deductions
2913	2913	4 allocable thereto) taken into account for the taxable
2914	2914	5 year with respect to a transaction with a taxpayer
2915	2915	6 that is required to make an addition modification with
2916	2916	7 respect to such transaction under Section
2917	2917	8 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
2918	2918	9 203(d)(2)(D-8), but not to exceed the amount of such
2919	2919	10 addition modification. This subparagraph (T) is exempt
2920	2920	11 from the provisions of Section 250;
2921	2921	12 (U) An amount equal to the interest income taken
2922	2922	13 into account for the taxable year (net of the
2923	2923	14 deductions allocable thereto) with respect to
2924	2924	15 transactions with (i) a foreign person who would be a
2925	2925	16 member of the taxpayer's unitary business group but
2926	2926	17 for the fact the foreign person's business activity
2927	2927	18 outside the United States is 80% or more of that
2928	2928	19 person's total business activity and (ii) for taxable
2929	2929	20 years ending on or after December 31, 2008, to a person
2930	2930	21 who would be a member of the same unitary business
2931	2931	22 group but for the fact that the person is prohibited
2932	2932	23 under Section 1501(a)(27) from being included in the
2933	2933	24 unitary business group because he or she is ordinarily
2934	2934	25 required to apportion business income under different
2935	2935	26 subsections of Section 304, but not to exceed the
2936	2936
2937	2937
2938	2938
2939	2939
2940	2940
2941	2941	HB1241 - 81 - LRB103 25002 HLH 51336 b
2942	2942
2943	2943
2944	2944	HB1241- 82 -LRB103 25002 HLH 51336 b HB1241 - 82 - LRB103 25002 HLH 51336 b
2945	2945	HB1241 - 82 - LRB103 25002 HLH 51336 b
2946	2946	1 addition modification required to be made for the same
2947	2947	2 taxable year under Section 203(c)(2)(G-12) for
2948	2948	3 interest paid, accrued, or incurred, directly or
2949	2949	4 indirectly, to the same person. This subparagraph (U)
2950	2950	5 is exempt from the provisions of Section 250;
2951	2951	6 (V) An amount equal to the income from intangible
2952	2952	7 property taken into account for the taxable year (net
2953	2953	8 of the deductions allocable thereto) with respect to
2954	2954	9 transactions with (i) a foreign person who would be a
2955	2955	10 member of the taxpayer's unitary business group but
2956	2956	11 for the fact that the foreign person's business
2957	2957	12 activity outside the United States is 80% or more of
2958	2958	13 that person's total business activity and (ii) for
2959	2959	14 taxable years ending on or after December 31, 2008, to
2960	2960	15 a person who would be a member of the same unitary
2961	2961	16 business group but for the fact that the person is
2962	2962	17 prohibited under Section 1501(a)(27) from being
2963	2963	18 included in the unitary business group because he or
2964	2964	19 she is ordinarily required to apportion business
2965	2965	20 income under different subsections of Section 304, but
2966	2966	21 not to exceed the addition modification required to be
2967	2967	22 made for the same taxable year under Section
2968	2968	23 203(c)(2)(G-13) for intangible expenses and costs
2969	2969	24 paid, accrued, or incurred, directly or indirectly, to
2970	2970	25 the same foreign person. This subparagraph (V) is
2971	2971	26 exempt from the provisions of Section 250;
2972	2972
2973	2973
2974	2974
2975	2975
2976	2976
2977	2977	HB1241 - 82 - LRB103 25002 HLH 51336 b
2978	2978
2979	2979
2980	2980	HB1241- 83 -LRB103 25002 HLH 51336 b HB1241 - 83 - LRB103 25002 HLH 51336 b
2981	2981	HB1241 - 83 - LRB103 25002 HLH 51336 b
2982	2982	1 (W) in the case of an estate, an amount equal to
2983	2983	2 all amounts included in such total pursuant to the
2984	2984	3 provisions of Section 111 of the Internal Revenue Code
2985	2985	4 as a recovery of items previously deducted by the
2986	2986	5 decedent from adjusted gross income in the computation
2987	2987	6 of taxable income. This subparagraph (W) is exempt
2988	2988	7 from Section 250;
2989	2989	8 (X) an amount equal to the refund included in such
2990	2990	9 total of any tax deducted for federal income tax
2991	2991	10 purposes, to the extent that deduction was added back
2992	2992	11 under subparagraph (F). This subparagraph (X) is
2993	2993	12 exempt from the provisions of Section 250;
2994	2994	13 (Y) For taxable years ending on or after December
2995	2995	14 31, 2011, in the case of a taxpayer who was required to
2996	2996	15 add back any insurance premiums under Section
2997	2997	16 203(c)(2)(G-14), such taxpayer may elect to subtract
2998	2998	17 that part of a reimbursement received from the
2999	2999	18 insurance company equal to the amount of the expense
3000	3000	19 or loss (including expenses incurred by the insurance
3001	3001	20 company) that would have been taken into account as a
3002	3002	21 deduction for federal income tax purposes if the
3003	3003	22 expense or loss had been uninsured. If a taxpayer
3004	3004	23 makes the election provided for by this subparagraph
3005	3005	24 (Y), the insurer to which the premiums were paid must
3006	3006	25 add back to income the amount subtracted by the
3007	3007	26 taxpayer pursuant to this subparagraph (Y). This
3008	3008
3009	3009
3010	3010
3011	3011
3012	3012
3013	3013	HB1241 - 83 - LRB103 25002 HLH 51336 b
3014	3014
3015	3015
3016	3016	HB1241- 84 -LRB103 25002 HLH 51336 b HB1241 - 84 - LRB103 25002 HLH 51336 b
3017	3017	HB1241 - 84 - LRB103 25002 HLH 51336 b
3018	3018	1 subparagraph (Y) is exempt from the provisions of
3019	3019	2 Section 250; and
3020	3020	3 (Z) For taxable years beginning after December 31,
3021	3021	4 2018 and before January 1, 2026, the amount of excess
3022	3022	5 business loss of the taxpayer disallowed as a
3023	3023	6 deduction by Section 461(l)(1)(B) of the Internal
3024	3024	7 Revenue Code.
3025	3025	8 (3) Limitation. The amount of any modification
3026	3026	9 otherwise required under this subsection shall, under
3027	3027	10 regulations prescribed by the Department, be adjusted by
3028	3028	11 any amounts included therein which were properly paid,
3029	3029	12 credited, or required to be distributed, or permanently
3030	3030	13 set aside for charitable purposes pursuant to Internal
3031	3031	14 Revenue Code Section 642(c) during the taxable year.
3032	3032	15 (d) Partnerships.
3033	3033	16 (1) In general. In the case of a partnership, base
3034	3034	17 income means an amount equal to the taxpayer's taxable
3035	3035	18 income for the taxable year as modified by paragraph (2).
3036	3036	19 (2) Modifications. The taxable income referred to in
3037	3037	20 paragraph (1) shall be modified by adding thereto the sum
3038	3038	21 of the following amounts:
3039	3039	22 (A) An amount equal to all amounts paid or accrued
3040	3040	23 to the taxpayer as interest or dividends during the
3041	3041	24 taxable year to the extent excluded from gross income
3042	3042	25 in the computation of taxable income;
3043	3043
3044	3044
3045	3045
3046	3046
3047	3047
3048	3048	HB1241 - 84 - LRB103 25002 HLH 51336 b
3049	3049
3050	3050
3051	3051	HB1241- 85 -LRB103 25002 HLH 51336 b HB1241 - 85 - LRB103 25002 HLH 51336 b
3052	3052	HB1241 - 85 - LRB103 25002 HLH 51336 b
3053	3053	1 (B) An amount equal to the amount of tax imposed by
3054	3054	2 this Act to the extent deducted from gross income for
3055	3055	3 the taxable year;
3056	3056	4 (C) The amount of deductions allowed to the
3057	3057	5 partnership pursuant to Section 707 (c) of the
3058	3058	6 Internal Revenue Code in calculating its taxable
3059	3059	7 income;
3060	3060	8 (D) An amount equal to the amount of the capital
3061	3061	9 gain deduction allowable under the Internal Revenue
3062	3062	10 Code, to the extent deducted from gross income in the
3063	3063	11 computation of taxable income;
3064	3064	12 (D-5) For taxable years 2001 and thereafter, an
3065	3065	13 amount equal to the bonus depreciation deduction taken
3066	3066	14 on the taxpayer's federal income tax return for the
3067	3067	15 taxable year under subsection (k) of Section 168 of
3068	3068	16 the Internal Revenue Code;
3069	3069	17 (D-6) If the taxpayer sells, transfers, abandons,
3070	3070	18 or otherwise disposes of property for which the
3071	3071	19 taxpayer was required in any taxable year to make an
3072	3072	20 addition modification under subparagraph (D-5), then
3073	3073	21 an amount equal to the aggregate amount of the
3074	3074	22 deductions taken in all taxable years under
3075	3075	23 subparagraph (O) with respect to that property.
3076	3076	24 If the taxpayer continues to own property through
3077	3077	25 the last day of the last tax year for which a
3078	3078	26 subtraction is allowed with respect to that property
3079	3079
3080	3080
3081	3081
3082	3082
3083	3083
3084	3084	HB1241 - 85 - LRB103 25002 HLH 51336 b
3085	3085
3086	3086
3087	3087	HB1241- 86 -LRB103 25002 HLH 51336 b HB1241 - 86 - LRB103 25002 HLH 51336 b
3088	3088	HB1241 - 86 - LRB103 25002 HLH 51336 b
3089	3089	1 under subparagraph (O) and for which the taxpayer was
3090	3090	2 allowed in any taxable year to make a subtraction
3091	3091	3 modification under subparagraph (O), then an amount
3092	3092	4 equal to that subtraction modification.
3093	3093	5 The taxpayer is required to make the addition
3094	3094	6 modification under this subparagraph only once with
3095	3095	7 respect to any one piece of property;
3096	3096	8 (D-7) An amount equal to the amount otherwise
3097	3097	9 allowed as a deduction in computing base income for
3098	3098	10 interest paid, accrued, or incurred, directly or
3099	3099	11 indirectly, (i) for taxable years ending on or after
3100	3100	12 December 31, 2004, to a foreign person who would be a
3101	3101	13 member of the same unitary business group but for the
3102	3102	14 fact the foreign person's business activity outside
3103	3103	15 the United States is 80% or more of the foreign
3104	3104	16 person's total business activity and (ii) for taxable
3105	3105	17 years ending on or after December 31, 2008, to a person
3106	3106	18 who would be a member of the same unitary business
3107	3107	19 group but for the fact that the person is prohibited
3108	3108	20 under Section 1501(a)(27) from being included in the
3109	3109	21 unitary business group because he or she is ordinarily
3110	3110	22 required to apportion business income under different
3111	3111	23 subsections of Section 304. The addition modification
3112	3112	24 required by this subparagraph shall be reduced to the
3113	3113	25 extent that dividends were included in base income of
3114	3114	26 the unitary group for the same taxable year and
3115	3115
3116	3116
3117	3117
3118	3118
3119	3119
3120	3120	HB1241 - 86 - LRB103 25002 HLH 51336 b
3121	3121
3122	3122
3123	3123	HB1241- 87 -LRB103 25002 HLH 51336 b HB1241 - 87 - LRB103 25002 HLH 51336 b
3124	3124	HB1241 - 87 - LRB103 25002 HLH 51336 b
3125	3125	1 received by the taxpayer or by a member of the
3126	3126	2 taxpayer's unitary business group (including amounts
3127	3127	3 included in gross income pursuant to Sections 951
3128	3128	4 through 964 of the Internal Revenue Code and amounts
3129	3129	5 included in gross income under Section 78 of the
3130	3130	6 Internal Revenue Code) with respect to the stock of
3131	3131	7 the same person to whom the interest was paid,
3132	3132	8 accrued, or incurred.
3133	3133	9 This paragraph shall not apply to the following:
3134	3134	10 (i) an item of interest paid, accrued, or
3135	3135	11 incurred, directly or indirectly, to a person who
3136	3136	12 is subject in a foreign country or state, other
3137	3137	13 than a state which requires mandatory unitary
3138	3138	14 reporting, to a tax on or measured by net income
3139	3139	15 with respect to such interest; or
3140	3140	16 (ii) an item of interest paid, accrued, or
3141	3141	17 incurred, directly or indirectly, to a person if
3142	3142	18 the taxpayer can establish, based on a
3143	3143	19 preponderance of the evidence, both of the
3144	3144	20 following:
3145	3145	21 (a) the person, during the same taxable
3146	3146	22 year, paid, accrued, or incurred, the interest
3147	3147	23 to a person that is not a related member, and
3148	3148	24 (b) the transaction giving rise to the
3149	3149	25 interest expense between the taxpayer and the
3150	3150	26 person did not have as a principal purpose the
3151	3151
3152	3152
3153	3153
3154	3154
3155	3155
3156	3156	HB1241 - 87 - LRB103 25002 HLH 51336 b
3157	3157
3158	3158
3159	3159	HB1241- 88 -LRB103 25002 HLH 51336 b HB1241 - 88 - LRB103 25002 HLH 51336 b
3160	3160	HB1241 - 88 - LRB103 25002 HLH 51336 b
3161	3161	1 avoidance of Illinois income tax, and is paid
3162	3162	2 pursuant to a contract or agreement that
3163	3163	3 reflects an arm's-length interest rate and
3164	3164	4 terms; or
3165	3165	5 (iii) the taxpayer can establish, based on
3166	3166	6 clear and convincing evidence, that the interest
3167	3167	7 paid, accrued, or incurred relates to a contract
3168	3168	8 or agreement entered into at arm's-length rates
3169	3169	9 and terms and the principal purpose for the
3170	3170	10 payment is not federal or Illinois tax avoidance;
3171	3171	11 or
3172	3172	12 (iv) an item of interest paid, accrued, or
3173	3173	13 incurred, directly or indirectly, to a person if
3174	3174	14 the taxpayer establishes by clear and convincing
3175	3175	15 evidence that the adjustments are unreasonable; or
3176	3176	16 if the taxpayer and the Director agree in writing
3177	3177	17 to the application or use of an alternative method
3178	3178	18 of apportionment under Section 304(f).
3179	3179	19 Nothing in this subsection shall preclude the
3180	3180	20 Director from making any other adjustment
3181	3181	21 otherwise allowed under Section 404 of this Act
3182	3182	22 for any tax year beginning after the effective
3183	3183	23 date of this amendment provided such adjustment is
3184	3184	24 made pursuant to regulation adopted by the
3185	3185	25 Department and such regulations provide methods
3186	3186	26 and standards by which the Department will utilize
3187	3187
3188	3188
3189	3189
3190	3190
3191	3191
3192	3192	HB1241 - 88 - LRB103 25002 HLH 51336 b
3193	3193
3194	3194
3195	3195	HB1241- 89 -LRB103 25002 HLH 51336 b HB1241 - 89 - LRB103 25002 HLH 51336 b
3196	3196	HB1241 - 89 - LRB103 25002 HLH 51336 b
3197	3197	1 its authority under Section 404 of this Act; and
3198	3198	2 (D-8) An amount equal to the amount of intangible
3199	3199	3 expenses and costs otherwise allowed as a deduction in
3200	3200	4 computing base income, and that were paid, accrued, or
3201	3201	5 incurred, directly or indirectly, (i) for taxable
3202	3202	6 years ending on or after December 31, 2004, to a
3203	3203	7 foreign person who would be a member of the same
3204	3204	8 unitary business group but for the fact that the
3205	3205	9 foreign person's business activity outside the United
3206	3206	10 States is 80% or more of that person's total business
3207	3207	11 activity and (ii) for taxable years ending on or after
3208	3208	12 December 31, 2008, to a person who would be a member of
3209	3209	13 the same unitary business group but for the fact that
3210	3210	14 the person is prohibited under Section 1501(a)(27)
3211	3211	15 from being included in the unitary business group
3212	3212	16 because he or she is ordinarily required to apportion
3213	3213	17 business income under different subsections of Section
3214	3214	18 304. The addition modification required by this
3215	3215	19 subparagraph shall be reduced to the extent that
3216	3216	20 dividends were included in base income of the unitary
3217	3217	21 group for the same taxable year and received by the
3218	3218	22 taxpayer or by a member of the taxpayer's unitary
3219	3219	23 business group (including amounts included in gross
3220	3220	24 income pursuant to Sections 951 through 964 of the
3221	3221	25 Internal Revenue Code and amounts included in gross
3222	3222	26 income under Section 78 of the Internal Revenue Code)
3223	3223
3224	3224
3225	3225
3226	3226
3227	3227
3228	3228	HB1241 - 89 - LRB103 25002 HLH 51336 b
3229	3229
3230	3230
3231	3231	HB1241- 90 -LRB103 25002 HLH 51336 b HB1241 - 90 - LRB103 25002 HLH 51336 b
3232	3232	HB1241 - 90 - LRB103 25002 HLH 51336 b
3233	3233	1 with respect to the stock of the same person to whom
3234	3234	2 the intangible expenses and costs were directly or
3235	3235	3 indirectly paid, incurred or accrued. The preceding
3236	3236	4 sentence shall not apply to the extent that the same
3237	3237	5 dividends caused a reduction to the addition
3238	3238	6 modification required under Section 203(d)(2)(D-7) of
3239	3239	7 this Act. As used in this subparagraph, the term
3240	3240	8 "intangible expenses and costs" includes (1) expenses,
3241	3241	9 losses, and costs for, or related to, the direct or
3242	3242	10 indirect acquisition, use, maintenance or management,
3243	3243	11 ownership, sale, exchange, or any other disposition of
3244	3244	12 intangible property; (2) losses incurred, directly or
3245	3245	13 indirectly, from factoring transactions or discounting
3246	3246	14 transactions; (3) royalty, patent, technical, and
3247	3247	15 copyright fees; (4) licensing fees; and (5) other
3248	3248	16 similar expenses and costs. For purposes of this
3249	3249	17 subparagraph, "intangible property" includes patents,
3250	3250	18 patent applications, trade names, trademarks, service
3251	3251	19 marks, copyrights, mask works, trade secrets, and
3252	3252	20 similar types of intangible assets;
3253	3253	21 This paragraph shall not apply to the following:
3254	3254	22 (i) any item of intangible expenses or costs
3255	3255	23 paid, accrued, or incurred, directly or
3256	3256	24 indirectly, from a transaction with a person who
3257	3257	25 is subject in a foreign country or state, other
3258	3258	26 than a state which requires mandatory unitary
3259	3259
3260	3260
3261	3261
3262	3262
3263	3263
3264	3264	HB1241 - 90 - LRB103 25002 HLH 51336 b
3265	3265
3266	3266
3267	3267	HB1241- 91 -LRB103 25002 HLH 51336 b HB1241 - 91 - LRB103 25002 HLH 51336 b
3268	3268	HB1241 - 91 - LRB103 25002 HLH 51336 b
3269	3269	1 reporting, to a tax on or measured by net income
3270	3270	2 with respect to such item; or
3271	3271	3 (ii) any item of intangible expense or cost
3272	3272	4 paid, accrued, or incurred, directly or
3273	3273	5 indirectly, if the taxpayer can establish, based
3274	3274	6 on a preponderance of the evidence, both of the
3275	3275	7 following:
3276	3276	8 (a) the person during the same taxable
3277	3277	9 year paid, accrued, or incurred, the
3278	3278	10 intangible expense or cost to a person that is
3279	3279	11 not a related member, and
3280	3280	12 (b) the transaction giving rise to the
3281	3281	13 intangible expense or cost between the
3282	3282	14 taxpayer and the person did not have as a
3283	3283	15 principal purpose the avoidance of Illinois
3284	3284	16 income tax, and is paid pursuant to a contract
3285	3285	17 or agreement that reflects arm's-length terms;
3286	3286	18 or
3287	3287	19 (iii) any item of intangible expense or cost
3288	3288	20 paid, accrued, or incurred, directly or
3289	3289	21 indirectly, from a transaction with a person if
3290	3290	22 the taxpayer establishes by clear and convincing
3291	3291	23 evidence, that the adjustments are unreasonable;
3292	3292	24 or if the taxpayer and the Director agree in
3293	3293	25 writing to the application or use of an
3294	3294	26 alternative method of apportionment under Section
3295	3295
3296	3296
3297	3297
3298	3298
3299	3299
3300	3300	HB1241 - 91 - LRB103 25002 HLH 51336 b
3301	3301
3302	3302
3303	3303	HB1241- 92 -LRB103 25002 HLH 51336 b HB1241 - 92 - LRB103 25002 HLH 51336 b
3304	3304	HB1241 - 92 - LRB103 25002 HLH 51336 b
3305	3305	1 304(f);
3306	3306	2 Nothing in this subsection shall preclude the
3307	3307	3 Director from making any other adjustment
3308	3308	4 otherwise allowed under Section 404 of this Act
3309	3309	5 for any tax year beginning after the effective
3310	3310	6 date of this amendment provided such adjustment is
3311	3311	7 made pursuant to regulation adopted by the
3312	3312	8 Department and such regulations provide methods
3313	3313	9 and standards by which the Department will utilize
3314	3314	10 its authority under Section 404 of this Act;
3315	3315	11 (D-9) For taxable years ending on or after
3316	3316	12 December 31, 2008, an amount equal to the amount of
3317	3317	13 insurance premium expenses and costs otherwise allowed
3318	3318	14 as a deduction in computing base income, and that were
3319	3319	15 paid, accrued, or incurred, directly or indirectly, to
3320	3320	16 a person who would be a member of the same unitary
3321	3321	17 business group but for the fact that the person is
3322	3322	18 prohibited under Section 1501(a)(27) from being
3323	3323	19 included in the unitary business group because he or
3324	3324	20 she is ordinarily required to apportion business
3325	3325	21 income under different subsections of Section 304. The
3326	3326	22 addition modification required by this subparagraph
3327	3327	23 shall be reduced to the extent that dividends were
3328	3328	24 included in base income of the unitary group for the
3329	3329	25 same taxable year and received by the taxpayer or by a
3330	3330	26 member of the taxpayer's unitary business group
3331	3331
3332	3332
3333	3333
3334	3334
3335	3335
3336	3336	HB1241 - 92 - LRB103 25002 HLH 51336 b
3337	3337
3338	3338
3339	3339	HB1241- 93 -LRB103 25002 HLH 51336 b HB1241 - 93 - LRB103 25002 HLH 51336 b
3340	3340	HB1241 - 93 - LRB103 25002 HLH 51336 b
3341	3341	1 (including amounts included in gross income under
3342	3342	2 Sections 951 through 964 of the Internal Revenue Code
3343	3343	3 and amounts included in gross income under Section 78
3344	3344	4 of the Internal Revenue Code) with respect to the
3345	3345	5 stock of the same person to whom the premiums and costs
3346	3346	6 were directly or indirectly paid, incurred, or
3347	3347	7 accrued. The preceding sentence does not apply to the
3348	3348	8 extent that the same dividends caused a reduction to
3349	3349	9 the addition modification required under Section
3350	3350	10 203(d)(2)(D-7) or Section 203(d)(2)(D-8) of this Act;
3351	3351	11 (D-10) An amount equal to the credit allowable to
3352	3352	12 the taxpayer under Section 218(a) of this Act,
3353	3353	13 determined without regard to Section 218(c) of this
3354	3354	14 Act;
3355	3355	15 (D-11) For taxable years ending on or after
3356	3356	16 December 31, 2017, an amount equal to the deduction
3357	3357	17 allowed under Section 199 of the Internal Revenue Code
3358	3358	18 for the taxable year;
3359	3359	19 (D-12) the amount that is claimed as a federal
3360	3360	20 deduction when computing the taxpayer's federal
3361	3361	21 taxable income for the taxable year and that is
3362	3362	22 attributable to an endowment gift for which the
3363	3363	23 taxpayer receives a credit under the Endow Illinois
3364	3364	24 Tax Credit Act;
3365	3365	25 and by deducting from the total so obtained the following
3366	3366	26 amounts:
3367	3367
3368	3368
3369	3369
3370	3370
3371	3371
3372	3372	HB1241 - 93 - LRB103 25002 HLH 51336 b
3373	3373
3374	3374
3375	3375	HB1241- 94 -LRB103 25002 HLH 51336 b HB1241 - 94 - LRB103 25002 HLH 51336 b
3376	3376	HB1241 - 94 - LRB103 25002 HLH 51336 b
3377	3377	1 (E) The valuation limitation amount;
3378	3378	2 (F) An amount equal to the amount of any tax
3379	3379	3 imposed by this Act which was refunded to the taxpayer
3380	3380	4 and included in such total for the taxable year;
3381	3381	5 (G) An amount equal to all amounts included in
3382	3382	6 taxable income as modified by subparagraphs (A), (B),
3383	3383	7 (C) and (D) which are exempt from taxation by this
3384	3384	8 State either by reason of its statutes or Constitution
3385	3385	9 or by reason of the Constitution, treaties or statutes
3386	3386	10 of the United States; provided that, in the case of any
3387	3387	11 statute of this State that exempts income derived from
3388	3388	12 bonds or other obligations from the tax imposed under
3389	3389	13 this Act, the amount exempted shall be the interest
3390	3390	14 net of bond premium amortization;
3391	3391	15 (H) Any income of the partnership which
3392	3392	16 constitutes personal service income as defined in
3393	3393	17 Section 1348(b)(1) of the Internal Revenue Code (as in
3394	3394	18 effect December 31, 1981) or a reasonable allowance
3395	3395	19 for compensation paid or accrued for services rendered
3396	3396	20 by partners to the partnership, whichever is greater;
3397	3397	21 this subparagraph (H) is exempt from the provisions of
3398	3398	22 Section 250;
3399	3399	23 (I) An amount equal to all amounts of income
3400	3400	24 distributable to an entity subject to the Personal
3401	3401	25 Property Tax Replacement Income Tax imposed by
3402	3402	26 subsections (c) and (d) of Section 201 of this Act
3403	3403
3404	3404
3405	3405
3406	3406
3407	3407
3408	3408	HB1241 - 94 - LRB103 25002 HLH 51336 b
3409	3409
3410	3410
3411	3411	HB1241- 95 -LRB103 25002 HLH 51336 b HB1241 - 95 - LRB103 25002 HLH 51336 b
3412	3412	HB1241 - 95 - LRB103 25002 HLH 51336 b
3413	3413	1 including amounts distributable to organizations
3414	3414	2 exempt from federal income tax by reason of Section
3415	3415	3 501(a) of the Internal Revenue Code; this subparagraph
3416	3416	4 (I) is exempt from the provisions of Section 250;
3417	3417	5 (J) With the exception of any amounts subtracted
3418	3418	6 under subparagraph (G), an amount equal to the sum of
3419	3419	7 all amounts disallowed as deductions by (i) Sections
3420	3420	8 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
3421	3421	9 and all amounts of expenses allocable to interest and
3422	3422	10 disallowed as deductions by Section 265(a)(1) of the
3423	3423	11 Internal Revenue Code; and (ii) for taxable years
3424	3424	12 ending on or after August 13, 1999, Sections
3425	3425	13 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
3426	3426	14 Internal Revenue Code, plus, (iii) for taxable years
3427	3427	15 ending on or after December 31, 2011, Section
3428	3428	16 45G(e)(3) of the Internal Revenue Code and, for
3429	3429	17 taxable years ending on or after December 31, 2008,
3430	3430	18 any amount included in gross income under Section 87
3431	3431	19 of the Internal Revenue Code; the provisions of this
3432	3432	20 subparagraph are exempt from the provisions of Section
3433	3433	21 250;
3434	3434	22 (K) An amount equal to those dividends included in
3435	3435	23 such total which were paid by a corporation which
3436	3436	24 conducts business operations in a River Edge
3437	3437	25 Redevelopment Zone or zones created under the River
3438	3438	26 Edge Redevelopment Zone Act and conducts substantially
3439	3439
3440	3440
3441	3441
3442	3442
3443	3443
3444	3444	HB1241 - 95 - LRB103 25002 HLH 51336 b
3445	3445
3446	3446
3447	3447	HB1241- 96 -LRB103 25002 HLH 51336 b HB1241 - 96 - LRB103 25002 HLH 51336 b
3448	3448	HB1241 - 96 - LRB103 25002 HLH 51336 b
3449	3449	1 all of its operations from a River Edge Redevelopment
3450	3450	2 Zone or zones. This subparagraph (K) is exempt from
3451	3451	3 the provisions of Section 250;
3452	3452	4 (L) An amount equal to any contribution made to a
3453	3453	5 job training project established pursuant to the Real
3454	3454	6 Property Tax Increment Allocation Redevelopment Act;
3455	3455	7 (M) An amount equal to those dividends included in
3456	3456	8 such total that were paid by a corporation that
3457	3457	9 conducts business operations in a federally designated
3458	3458	10 Foreign Trade Zone or Sub-Zone and that is designated
3459	3459	11 a High Impact Business located in Illinois; provided
3460	3460	12 that dividends eligible for the deduction provided in
3461	3461	13 subparagraph (K) of paragraph (2) of this subsection
3462	3462	14 shall not be eligible for the deduction provided under
3463	3463	15 this subparagraph (M);
3464	3464	16 (N) An amount equal to the amount of the deduction
3465	3465	17 used to compute the federal income tax credit for
3466	3466	18 restoration of substantial amounts held under claim of
3467	3467	19 right for the taxable year pursuant to Section 1341 of
3468	3468	20 the Internal Revenue Code;
3469	3469	21 (O) For taxable years 2001 and thereafter, for the
3470	3470	22 taxable year in which the bonus depreciation deduction
3471	3471	23 is taken on the taxpayer's federal income tax return
3472	3472	24 under subsection (k) of Section 168 of the Internal
3473	3473	25 Revenue Code and for each applicable taxable year
3474	3474	26 thereafter, an amount equal to "x", where:
3475	3475
3476	3476
3477	3477
3478	3478
3479	3479
3480	3480	HB1241 - 96 - LRB103 25002 HLH 51336 b
3481	3481
3482	3482
3483	3483	HB1241- 97 -LRB103 25002 HLH 51336 b HB1241 - 97 - LRB103 25002 HLH 51336 b
3484	3484	HB1241 - 97 - LRB103 25002 HLH 51336 b
3485	3485	1 (1) "y" equals the amount of the depreciation
3486	3486	2 deduction taken for the taxable year on the
3487	3487	3 taxpayer's federal income tax return on property
3488	3488	4 for which the bonus depreciation deduction was
3489	3489	5 taken in any year under subsection (k) of Section
3490	3490	6 168 of the Internal Revenue Code, but not
3491	3491	7 including the bonus depreciation deduction;
3492	3492	8 (2) for taxable years ending on or before
3493	3493	9 December 31, 2005, "x" equals "y" multiplied by 30
3494	3494	10 and then divided by 70 (or "y" multiplied by
3495	3495	11 0.429); and
3496	3496	12 (3) for taxable years ending after December
3497	3497	13 31, 2005:
3498	3498	14 (i) for property on which a bonus
3499	3499	15 depreciation deduction of 30% of the adjusted
3500	3500	16 basis was taken, "x" equals "y" multiplied by
3501	3501	17 30 and then divided by 70 (or "y" multiplied
3502	3502	18 by 0.429);
3503	3503	19 (ii) for property on which a bonus
3504	3504	20 depreciation deduction of 50% of the adjusted
3505	3505	21 basis was taken, "x" equals "y" multiplied by
3506	3506	22 1.0;
3507	3507	23 (iii) for property on which a bonus
3508	3508	24 depreciation deduction of 100% of the adjusted
3509	3509	25 basis was taken in a taxable year ending on or
3510	3510	26 after December 31, 2021, "x" equals the
3511	3511
3512	3512
3513	3513
3514	3514
3515	3515
3516	3516	HB1241 - 97 - LRB103 25002 HLH 51336 b
3517	3517
3518	3518
3519	3519	HB1241- 98 -LRB103 25002 HLH 51336 b HB1241 - 98 - LRB103 25002 HLH 51336 b
3520	3520	HB1241 - 98 - LRB103 25002 HLH 51336 b
3521	3521	1 depreciation deduction that would be allowed
3522	3522	2 on that property if the taxpayer had made the
3523	3523	3 election under Section 168(k)(7) of the
3524	3524	4 Internal Revenue Code to not claim bonus
3525	3525	5 depreciation on that property; and
3526	3526	6 (iv) for property on which a bonus
3527	3527	7 depreciation deduction of a percentage other
3528	3528	8 than 30%, 50% or 100% of the adjusted basis
3529	3529	9 was taken in a taxable year ending on or after
3530	3530	10 December 31, 2021, "x" equals "y" multiplied
3531	3531	11 by 100 times the percentage bonus depreciation
3532	3532	12 on the property (that is, 100(bonus%)) and
3533	3533	13 then divided by 100 times 1 minus the
3534	3534	14 percentage bonus depreciation on the property
3535	3535	15 (that is, 100(1bonus%)).
3536	3536	16 The aggregate amount deducted under this
3537	3537	17 subparagraph in all taxable years for any one piece of
3538	3538	18 property may not exceed the amount of the bonus
3539	3539	19 depreciation deduction taken on that property on the
3540	3540	20 taxpayer's federal income tax return under subsection
3541	3541	21 (k) of Section 168 of the Internal Revenue Code. This
3542	3542	22 subparagraph (O) is exempt from the provisions of
3543	3543	23 Section 250;
3544	3544	24 (P) If the taxpayer sells, transfers, abandons, or
3545	3545	25 otherwise disposes of property for which the taxpayer
3546	3546	26 was required in any taxable year to make an addition
3547	3547
3548	3548
3549	3549
3550	3550
3551	3551
3552	3552	HB1241 - 98 - LRB103 25002 HLH 51336 b
3553	3553
3554	3554
3555	3555	HB1241- 99 -LRB103 25002 HLH 51336 b HB1241 - 99 - LRB103 25002 HLH 51336 b
3556	3556	HB1241 - 99 - LRB103 25002 HLH 51336 b
3557	3557	1 modification under subparagraph (D-5), then an amount
3558	3558	2 equal to that addition modification.
3559	3559	3 If the taxpayer continues to own property through
3560	3560	4 the last day of the last tax year for which a
3561	3561	5 subtraction is allowed with respect to that property
3562	3562	6 under subparagraph (O) and for which the taxpayer was
3563	3563	7 required in any taxable year to make an addition
3564	3564	8 modification under subparagraph (D-5), then an amount
3565	3565	9 equal to that addition modification.
3566	3566	10 The taxpayer is allowed to take the deduction
3567	3567	11 under this subparagraph only once with respect to any
3568	3568	12 one piece of property.
3569	3569	13 This subparagraph (P) is exempt from the
3570	3570	14 provisions of Section 250;
3571	3571	15 (Q) The amount of (i) any interest income (net of
3572	3572	16 the deductions allocable thereto) taken into account
3573	3573	17 for the taxable year with respect to a transaction
3574	3574	18 with a taxpayer that is required to make an addition
3575	3575	19 modification with respect to such transaction under
3576	3576	20 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
3577	3577	21 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
3578	3578	22 the amount of such addition modification and (ii) any
3579	3579	23 income from intangible property (net of the deductions
3580	3580	24 allocable thereto) taken into account for the taxable
3581	3581	25 year with respect to a transaction with a taxpayer
3582	3582	26 that is required to make an addition modification with
3583	3583
3584	3584
3585	3585
3586	3586
3587	3587
3588	3588	HB1241 - 99 - LRB103 25002 HLH 51336 b
3589	3589
3590	3590
3591	3591	HB1241- 100 -LRB103 25002 HLH 51336 b HB1241 - 100 - LRB103 25002 HLH 51336 b
3592	3592	HB1241 - 100 - LRB103 25002 HLH 51336 b
3593	3593	1 respect to such transaction under Section
3594	3594	2 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
3595	3595	3 203(d)(2)(D-8), but not to exceed the amount of such
3596	3596	4 addition modification. This subparagraph (Q) is exempt
3597	3597	5 from Section 250;
3598	3598	6 (R) An amount equal to the interest income taken
3599	3599	7 into account for the taxable year (net of the
3600	3600	8 deductions allocable thereto) with respect to
3601	3601	9 transactions with (i) a foreign person who would be a
3602	3602	10 member of the taxpayer's unitary business group but
3603	3603	11 for the fact that the foreign person's business
3604	3604	12 activity outside the United States is 80% or more of
3605	3605	13 that person's total business activity and (ii) for
3606	3606	14 taxable years ending on or after December 31, 2008, to
3607	3607	15 a person who would be a member of the same unitary
3608	3608	16 business group but for the fact that the person is
3609	3609	17 prohibited under Section 1501(a)(27) from being
3610	3610	18 included in the unitary business group because he or
3611	3611	19 she is ordinarily required to apportion business
3612	3612	20 income under different subsections of Section 304, but
3613	3613	21 not to exceed the addition modification required to be
3614	3614	22 made for the same taxable year under Section
3615	3615	23 203(d)(2)(D-7) for interest paid, accrued, or
3616	3616	24 incurred, directly or indirectly, to the same person.
3617	3617	25 This subparagraph (R) is exempt from Section 250;
3618	3618	26 (S) An amount equal to the income from intangible
3619	3619
3620	3620
3621	3621
3622	3622
3623	3623
3624	3624	HB1241 - 100 - LRB103 25002 HLH 51336 b
3625	3625
3626	3626
3627	3627	HB1241- 101 -LRB103 25002 HLH 51336 b HB1241 - 101 - LRB103 25002 HLH 51336 b
3628	3628	HB1241 - 101 - LRB103 25002 HLH 51336 b
3629	3629	1 property taken into account for the taxable year (net
3630	3630	2 of the deductions allocable thereto) with respect to
3631	3631	3 transactions with (i) a foreign person who would be a
3632	3632	4 member of the taxpayer's unitary business group but
3633	3633	5 for the fact that the foreign person's business
3634	3634	6 activity outside the United States is 80% or more of
3635	3635	7 that person's total business activity and (ii) for
3636	3636	8 taxable years ending on or after December 31, 2008, to
3637	3637	9 a person who would be a member of the same unitary
3638	3638	10 business group but for the fact that the person is
3639	3639	11 prohibited under Section 1501(a)(27) from being
3640	3640	12 included in the unitary business group because he or
3641	3641	13 she is ordinarily required to apportion business
3642	3642	14 income under different subsections of Section 304, but
3643	3643	15 not to exceed the addition modification required to be
3644	3644	16 made for the same taxable year under Section
3645	3645	17 203(d)(2)(D-8) for intangible expenses and costs paid,
3646	3646	18 accrued, or incurred, directly or indirectly, to the
3647	3647	19 same person. This subparagraph (S) is exempt from
3648	3648	20 Section 250; and
3649	3649	21 (T) For taxable years ending on or after December
3650	3650	22 31, 2011, in the case of a taxpayer who was required to
3651	3651	23 add back any insurance premiums under Section
3652	3652	24 203(d)(2)(D-9), such taxpayer may elect to subtract
3653	3653	25 that part of a reimbursement received from the
3654	3654	26 insurance company equal to the amount of the expense
3655	3655
3656	3656
3657	3657
3658	3658
3659	3659
3660	3660	HB1241 - 101 - LRB103 25002 HLH 51336 b
3661	3661
3662	3662
3663	3663	HB1241- 102 -LRB103 25002 HLH 51336 b HB1241 - 102 - LRB103 25002 HLH 51336 b
3664	3664	HB1241 - 102 - LRB103 25002 HLH 51336 b
3665	3665	1 or loss (including expenses incurred by the insurance
3666	3666	2 company) that would have been taken into account as a
3667	3667	3 deduction for federal income tax purposes if the
3668	3668	4 expense or loss had been uninsured. If a taxpayer
3669	3669	5 makes the election provided for by this subparagraph
3670	3670	6 (T), the insurer to which the premiums were paid must
3671	3671	7 add back to income the amount subtracted by the
3672	3672	8 taxpayer pursuant to this subparagraph (T). This
3673	3673	9 subparagraph (T) is exempt from the provisions of
3674	3674	10 Section 250.
3675	3675	11 (e) Gross income; adjusted gross income; taxable income.
3676	3676	12 (1) In general. Subject to the provisions of paragraph
3677	3677	13 (2) and subsection (b)(3), for purposes of this Section
3678	3678	14 and Section 803(e), a taxpayer's gross income, adjusted
3679	3679	15 gross income, or taxable income for the taxable year shall
3680	3680	16 mean the amount of gross income, adjusted gross income or
3681	3681	17 taxable income properly reportable for federal income tax
3682	3682	18 purposes for the taxable year under the provisions of the
3683	3683	19 Internal Revenue Code. Taxable income may be less than
3684	3684	20 zero. However, for taxable years ending on or after
3685	3685	21 December 31, 1986, net operating loss carryforwards from
3686	3686	22 taxable years ending prior to December 31, 1986, may not
3687	3687	23 exceed the sum of federal taxable income for the taxable
3688	3688	24 year before net operating loss deduction, plus the excess
3689	3689	25 of addition modifications over subtraction modifications
3690	3690
3691	3691
3692	3692
3693	3693
3694	3694
3695	3695	HB1241 - 102 - LRB103 25002 HLH 51336 b
3696	3696
3697	3697
3698	3698	HB1241- 103 -LRB103 25002 HLH 51336 b HB1241 - 103 - LRB103 25002 HLH 51336 b
3699	3699	HB1241 - 103 - LRB103 25002 HLH 51336 b
3700	3700	1 for the taxable year. For taxable years ending prior to
3701	3701	2 December 31, 1986, taxable income may never be an amount
3702	3702	3 in excess of the net operating loss for the taxable year as
3703	3703	4 defined in subsections (c) and (d) of Section 172 of the
3704	3704	5 Internal Revenue Code, provided that when taxable income
3705	3705	6 of a corporation (other than a Subchapter S corporation),
3706	3706	7 trust, or estate is less than zero and addition
3707	3707	8 modifications, other than those provided by subparagraph
3708	3708	9 (E) of paragraph (2) of subsection (b) for corporations or
3709	3709	10 subparagraph (E) of paragraph (2) of subsection (c) for
3710	3710	11 trusts and estates, exceed subtraction modifications, an
3711	3711	12 addition modification must be made under those
3712	3712	13 subparagraphs for any other taxable year to which the
3713	3713	14 taxable income less than zero (net operating loss) is
3714	3714	15 applied under Section 172 of the Internal Revenue Code or
3715	3715	16 under subparagraph (E) of paragraph (2) of this subsection
3716	3716	17 (e) applied in conjunction with Section 172 of the
3717	3717	18 Internal Revenue Code.
3718	3718	19 (2) Special rule. For purposes of paragraph (1) of
3719	3719	20 this subsection, the taxable income properly reportable
3720	3720	21 for federal income tax purposes shall mean:
3721	3721	22 (A) Certain life insurance companies. In the case
3722	3722	23 of a life insurance company subject to the tax imposed
3723	3723	24 by Section 801 of the Internal Revenue Code, life
3724	3724	25 insurance company taxable income, plus the amount of
3725	3725	26 distribution from pre-1984 policyholder surplus
3726	3726
3727	3727
3728	3728
3729	3729
3730	3730
3731	3731	HB1241 - 103 - LRB103 25002 HLH 51336 b
3732	3732
3733	3733
3734	3734	HB1241- 104 -LRB103 25002 HLH 51336 b HB1241 - 104 - LRB103 25002 HLH 51336 b
3735	3735	HB1241 - 104 - LRB103 25002 HLH 51336 b
3736	3736	1 accounts as calculated under Section 815a of the
3737	3737	2 Internal Revenue Code;
3738	3738	3 (B) Certain other insurance companies. In the case
3739	3739	4 of mutual insurance companies subject to the tax
3740	3740	5 imposed by Section 831 of the Internal Revenue Code,
3741	3741	6 insurance company taxable income;
3742	3742	7 (C) Regulated investment companies. In the case of
3743	3743	8 a regulated investment company subject to the tax
3744	3744	9 imposed by Section 852 of the Internal Revenue Code,
3745	3745	10 investment company taxable income;
3746	3746	11 (D) Real estate investment trusts. In the case of
3747	3747	12 a real estate investment trust subject to the tax
3748	3748	13 imposed by Section 857 of the Internal Revenue Code,
3749	3749	14 real estate investment trust taxable income;
3750	3750	15 (E) Consolidated corporations. In the case of a
3751	3751	16 corporation which is a member of an affiliated group
3752	3752	17 of corporations filing a consolidated income tax
3753	3753	18 return for the taxable year for federal income tax
3754	3754	19 purposes, taxable income determined as if such
3755	3755	20 corporation had filed a separate return for federal
3756	3756	21 income tax purposes for the taxable year and each
3757	3757	22 preceding taxable year for which it was a member of an
3758	3758	23 affiliated group. For purposes of this subparagraph,
3759	3759	24 the taxpayer's separate taxable income shall be
3760	3760	25 determined as if the election provided by Section
3761	3761	26 243(b)(2) of the Internal Revenue Code had been in
3762	3762
3763	3763
3764	3764
3765	3765
3766	3766
3767	3767	HB1241 - 104 - LRB103 25002 HLH 51336 b
3768	3768
3769	3769
3770	3770	HB1241- 105 -LRB103 25002 HLH 51336 b HB1241 - 105 - LRB103 25002 HLH 51336 b
3771	3771	HB1241 - 105 - LRB103 25002 HLH 51336 b
3772	3772	1 effect for all such years;
3773	3773	2 (F) Cooperatives. In the case of a cooperative
3774	3774	3 corporation or association, the taxable income of such
3775	3775	4 organization determined in accordance with the
3776	3776	5 provisions of Section 1381 through 1388 of the
3777	3777	6 Internal Revenue Code, but without regard to the
3778	3778	7 prohibition against offsetting losses from patronage
3779	3779	8 activities against income from nonpatronage
3780	3780	9 activities; except that a cooperative corporation or
3781	3781	10 association may make an election to follow its federal
3782	3782	11 income tax treatment of patronage losses and
3783	3783	12 nonpatronage losses. In the event such election is
3784	3784	13 made, such losses shall be computed and carried over
3785	3785	14 in a manner consistent with subsection (a) of Section
3786	3786	15 207 of this Act and apportioned by the apportionment
3787	3787	16 factor reported by the cooperative on its Illinois
3788	3788	17 income tax return filed for the taxable year in which
3789	3789	18 the losses are incurred. The election shall be
3790	3790	19 effective for all taxable years with original returns
3791	3791	20 due on or after the date of the election. In addition,
3792	3792	21 the cooperative may file an amended return or returns,
3793	3793	22 as allowed under this Act, to provide that the
3794	3794	23 election shall be effective for losses incurred or
3795	3795	24 carried forward for taxable years occurring prior to
3796	3796	25 the date of the election. Once made, the election may
3797	3797	26 only be revoked upon approval of the Director. The
3798	3798
3799	3799
3800	3800
3801	3801
3802	3802
3803	3803	HB1241 - 105 - LRB103 25002 HLH 51336 b
3804	3804
3805	3805
3806	3806	HB1241- 106 -LRB103 25002 HLH 51336 b HB1241 - 106 - LRB103 25002 HLH 51336 b
3807	3807	HB1241 - 106 - LRB103 25002 HLH 51336 b
3808	3808	1 Department shall adopt rules setting forth
3809	3809	2 requirements for documenting the elections and any
3810	3810	3 resulting Illinois net loss and the standards to be
3811	3811	4 used by the Director in evaluating requests to revoke
3812	3812	5 elections. Public Act 96-932 is declaratory of
3813	3813	6 existing law;
3814	3814	7 (G) Subchapter S corporations. In the case of: (i)
3815	3815	8 a Subchapter S corporation for which there is in
3816	3816	9 effect an election for the taxable year under Section
3817	3817	10 1362 of the Internal Revenue Code, the taxable income
3818	3818	11 of such corporation determined in accordance with
3819	3819	12 Section 1363(b) of the Internal Revenue Code, except
3820	3820	13 that taxable income shall take into account those
3821	3821	14 items which are required by Section 1363(b)(1) of the
3822	3822	15 Internal Revenue Code to be separately stated; and
3823	3823	16 (ii) a Subchapter S corporation for which there is in
3824	3824	17 effect a federal election to opt out of the provisions
3825	3825	18 of the Subchapter S Revision Act of 1982 and have
3826	3826	19 applied instead the prior federal Subchapter S rules
3827	3827	20 as in effect on July 1, 1982, the taxable income of
3828	3828	21 such corporation determined in accordance with the
3829	3829	22 federal Subchapter S rules as in effect on July 1,
3830	3830	23 1982; and
3831	3831	24 (H) Partnerships. In the case of a partnership,
3832	3832	25 taxable income determined in accordance with Section
3833	3833	26 703 of the Internal Revenue Code, except that taxable
3834	3834
3835	3835
3836	3836
3837	3837
3838	3838
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3840	3840
3841	3841
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3843	3843	HB1241 - 107 - LRB103 25002 HLH 51336 b
3844	3844	1 income shall take into account those items which are
3845	3845	2 required by Section 703(a)(1) to be separately stated
3846	3846	3 but which would be taken into account by an individual
3847	3847	4 in calculating his taxable income.
3848	3848	5 (3) Recapture of business expenses on disposition of
3849	3849	6 asset or business. Notwithstanding any other law to the
3850	3850	7 contrary, if in prior years income from an asset or
3851	3851	8 business has been classified as business income and in a
3852	3852	9 later year is demonstrated to be non-business income, then
3853	3853	10 all expenses, without limitation, deducted in such later
3854	3854	11 year and in the 2 immediately preceding taxable years
3855	3855	12 related to that asset or business that generated the
3856	3856	13 non-business income shall be added back and recaptured as
3857	3857	14 business income in the year of the disposition of the
3858	3858	15 asset or business. Such amount shall be apportioned to
3859	3859	16 Illinois using the greater of the apportionment fraction
3860	3860	17 computed for the business under Section 304 of this Act
3861	3861	18 for the taxable year or the average of the apportionment
3862	3862	19 fractions computed for the business under Section 304 of
3863	3863	20 this Act for the taxable year and for the 2 immediately
3864	3864	21 preceding taxable years.
3865	3865	22 (f) Valuation limitation amount.
3866	3866	23 (1) In general. The valuation limitation amount
3867	3867	24 referred to in subsections (a)(2)(G), (c)(2)(I) and
3868	3868	25 (d)(2)(E) is an amount equal to:
3869	3869
3870	3870
3871	3871
3872	3872
3873	3873
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3875	3875
3876	3876
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3878	3878	HB1241 - 108 - LRB103 25002 HLH 51336 b
3879	3879	1 (A) The sum of the pre-August 1, 1969 appreciation
3880	3880	2 amounts (to the extent consisting of gain reportable
3881	3881	3 under the provisions of Section 1245 or 1250 of the
3882	3882	4 Internal Revenue Code) for all property in respect of
3883	3883	5 which such gain was reported for the taxable year;
3884	3884	6 plus
3885	3885	7 (B) The lesser of (i) the sum of the pre-August 1,
3886	3886	8 1969 appreciation amounts (to the extent consisting of
3887	3887	9 capital gain) for all property in respect of which
3888	3888	10 such gain was reported for federal income tax purposes
3889	3889	11 for the taxable year, or (ii) the net capital gain for
3890	3890	12 the taxable year, reduced in either case by any amount
3891	3891	13 of such gain included in the amount determined under
3892	3892	14 subsection (a)(2)(F) or (c)(2)(H).
3893	3893	15 (2) Pre-August 1, 1969 appreciation amount.
3894	3894	16 (A) If the fair market value of property referred
3895	3895	17 to in paragraph (1) was readily ascertainable on
3896	3896	18 August 1, 1969, the pre-August 1, 1969 appreciation
3897	3897	19 amount for such property is the lesser of (i) the
3898	3898	20 excess of such fair market value over the taxpayer's
3899	3899	21 basis (for determining gain) for such property on that
3900	3900	22 date (determined under the Internal Revenue Code as in
3901	3901	23 effect on that date), or (ii) the total gain realized
3902	3902	24 and reportable for federal income tax purposes in
3903	3903	25 respect of the sale, exchange or other disposition of
3904	3904	26 such property.
3905	3905
3906	3906
3907	3907
3908	3908
3909	3909
3910	3910	HB1241 - 108 - LRB103 25002 HLH 51336 b
3911	3911
3912	3912
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3915	3915	1 (B) If the fair market value of property referred
3916	3916	2 to in paragraph (1) was not readily ascertainable on
3917	3917	3 August 1, 1969, the pre-August 1, 1969 appreciation
3918	3918	4 amount for such property is that amount which bears
3919	3919	5 the same ratio to the total gain reported in respect of
3920	3920	6 the property for federal income tax purposes for the
3921	3921	7 taxable year, as the number of full calendar months in
3922	3922	8 that part of the taxpayer's holding period for the
3923	3923	9 property ending July 31, 1969 bears to the number of
3924	3924	10 full calendar months in the taxpayer's entire holding
3925	3925	11 period for the property.
3926	3926	12 (C) The Department shall prescribe such
3927	3927	13 regulations as may be necessary to carry out the
3928	3928	14 purposes of this paragraph.
3929	3929	15 (g) Double deductions. Unless specifically provided
3930	3930	16 otherwise, nothing in this Section shall permit the same item
3931	3931	17 to be deducted more than once.
3932	3932	18 (h) Legislative intention. Except as expressly provided by
3933	3933	19 this Section there shall be no modifications or limitations on
3934	3934	20 the amounts of income, gain, loss or deduction taken into
3935	3935	21 account in determining gross income, adjusted gross income or
3936	3936	22 taxable income for federal income tax purposes for the taxable
3937	3937	23 year, or in the amount of such items entering into the
3938	3938	24 computation of base income and net income under this Act for
3939	3939
3940	3940
3941	3941
3942	3942
3943	3943
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3945	3945
3946	3946
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3948	3948	HB1241 - 110 - LRB103 25002 HLH 51336 b
3949	3949	1 such taxable year, whether in respect of property values as of
3950	3950	2 August 1, 1969 or otherwise.
3951	3951	3 (Source: P.A. 101-9, eff. 6-5-19; 101-81, eff. 7-12-19;
3952	3952	4 102-16, eff. 6-17-21; 102-558, eff. 8-20-21; 102-658, eff.
3953	3953	5 8-27-21; 102-813, eff. 5-13-22; 102-1112, eff. 12-21-22.)
3954	3954	6 (35 ILCS 5/234 new)
3955	3955	7 Sec. 234. The Endow Illinois tax credit.
3956	3956	8 (a) For taxable years ending on or after December 31, 2024
3957	3957	9 and ending before January 1, 2034, each taxpayer for whom a tax
3958	3958	10 credit has been authorized by the Department of Revenue under
3959	3959	11 the Endow Illinois Tax Credit Act is entitled to a credit
3960	3960	12 against the tax imposed under subsections (a) and (b) of
3961	3961	13 Section 201 in an amount equal to the amount authorized under
3962	3962	14 that Act.
3963	3963	15 (b) For partners of partnerships and shareholders of
3964	3964	16 Subchapter S corporations, there is allowed a credit under
3965	3965	17 this Section to be determined in accordance with the
3966	3966	18 determination of income and distributive share of income under
3967	3967	19 Sections 702 and 704 and Subchapter S of the Internal Revenue
3968	3968	20 Code.
3969	3969	21 (c) The credit may not be carried back and may not reduce
3970	3970	22 the taxpayer's liability to less than zero. If the amount of
3971	3971	23 the credit exceeds the tax liability for the year, the excess
3972	3972	24 may be carried forward and applied to the tax liability of the
3973	3973	25 5 taxable years following the excess credit year. The tax
3974	3974
3975	3975
3976	3976
3977	3977
3978	3978
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3980	3980
3981	3981
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3983	3983	HB1241 - 111 - LRB103 25002 HLH 51336 b
3984	3984	1 credit shall be applied to the earliest year for which there is
3985	3985	2 a tax liability. If there are credits for more than one year
3986	3986	3 that are available to offset a liability, the earlier credit
3987	3987	4 shall be applied first.
3988	3988	5 Section 999. Effective date. This Act takes effect upon
3989	3989	6 becoming law.
3990	3990
3991	3991
3992	3992
3993	3993
3994	3994
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