Illinois 2023-2024 Regular Session

Illinois Senate Bill SB1531 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 SB1531 Introduced 2/8/2023, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2023, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately. LRB103 25040 HLH 51374 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1531 Introduced 2/8/2023, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2023, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately. LRB103 25040 HLH 51374 b LRB103 25040 HLH 51374 b A BILL FOR
2	2	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1531 Introduced 2/8/2023, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 16/10 35 ILCS 16/10
4	4	35 ILCS 16/10
5	5	Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2023, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately.
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11	11	1 AN ACT concerning revenue.
12	12	2 Be it enacted by the People of the State of Illinois,
13	13	3 represented in the General Assembly:
14	14	4 Section 5. The Film Production Services Tax Credit Act of
15	15	5 2008 is amended by changing Section 10 as follows:
16	16	6 (35 ILCS 16/10)
17	17	7 Sec. 10. Definitions. As used in this Act:
18	18	8 "Accredited production" means: (i) for productions
19	19	9 commencing before May 1, 2006, a film, video, or television
20	20	10 production that has been certified by the Department in which
21	21	11 the aggregate Illinois labor expenditures included in the cost
22	22	12 of the production, in the period that ends 12 months after the
23	23	13 time principal filming or taping of the production began,
24	24	14 exceed $100,000 for productions of 30 minutes or longer, or
25	25	15 $50,000 for productions of less than 30 minutes; and (ii) for
26	26	16 productions commencing on or after May 1, 2006, a film, video,
27	27	17 or television production that has been certified by the
28	28	18 Department in which the Illinois production spending included
29	29	19 in the cost of production in the period that ends 12 months
30	30	20 after the time principal filming or taping of the production
31	31	21 began exceeds $100,000 for productions of 30 minutes or longer
32	32	22 or exceeds $50,000 for productions of less than 30 minutes.
33	33	23 "Accredited production" does not include a production that:
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37	37	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1531 Introduced 2/8/2023, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED:
38	38	35 ILCS 16/10 35 ILCS 16/10
39	39	35 ILCS 16/10
40	40	Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2023, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately.
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68	68	1 (1) is news, current events, or public programming, or
69	69	2 a program that includes weather or market reports;
70	70	3 (2) is a talk show;
71	71	4 (3) is a production in respect of a game,
72	72	5 questionnaire, or contest;
73	73	6 (4) is a sports event or activity;
74	74	7 (5) is a gala presentation or awards show;
75	75	8 (6) is a finished production that solicits funds;
76	76	9 (7) is a production produced by a film production
77	77	10 company if records, as required by 18 U.S.C. 2257, are to
78	78	11 be maintained by that film production company with respect
79	79	12 to any performer portrayed in that single media or
80	80	13 multimedia program; or
81	81	14 (8) is a production produced primarily for industrial,
82	82	15 corporate, or institutional purposes.
83	83	16 "Accredited animated production" means an accredited
84	84	17 production in which movement and characters' performances are
85	85	18 created using a frame-by-frame technique and a significant
86	86	19 number of major characters are animated. Motion capture by
87	87	20 itself is not an animation technique.
88	88	21 "Accredited production certificate" means a certificate
89	89	22 issued by the Department certifying that the production is an
90	90	23 accredited production that meets the guidelines of this Act.
91	91	24 "Applicant" means a taxpayer that is a film production
92	92	25 company that is operating or has operated an accredited
93	93	26 production located within the State of Illinois and that (i)
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104	104	1 owns the copyright in the accredited production throughout the
105	105	2 Illinois production period or (ii) has contracted directly
106	106	3 with the owner of the copyright in the accredited production
107	107	4 or a person acting on behalf of the owner to provide services
108	108	5 for the production, where the owner of the copyright is not an
109	109	6 eligible production corporation.
110	110	7 "Credit" means:
111	111	8 (1) for an accredited production approved by the
112	112	9 Department on or before January 1, 2005 and commencing
113	113	10 before May 1, 2006, the amount equal to 25% of the Illinois
114	114	11 labor expenditure approved by the Department. The
115	115	12 applicant is deemed to have paid, on its balance due day
116	116	13 for the year, an amount equal to 25% of its qualified
117	117	14 Illinois labor expenditure for the tax year. For Illinois
118	118	15 labor expenditures generated by the employment of
119	119	16 residents of geographic areas of high poverty or high
120	120	17 unemployment, as determined by the Department, in an
121	121	18 accredited production commencing before May 1, 2006 and
122	122	19 approved by the Department after January 1, 2005, the
123	123	20 applicant shall receive an enhanced credit of 10% in
124	124	21 addition to the 25% credit; and
125	125	22 (2) for an accredited production commencing on or
126	126	23 after May 1, 2006, the amount equal to:
127	127	24 (i) 20% of the Illinois production spending for
128	128	25 the taxable year; plus
129	129	26 (ii) 15% of the Illinois labor expenditures
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140	140	1 generated by the employment of residents of geographic
141	141	2 areas of high poverty or high unemployment, as
142	142	3 determined by the Department; and
143	143	4 (3) for an accredited production commencing on or
144	144	5 after January 1, 2009 and prior to July 1, 2023, the amount
145	145	6 equal to:
146	146	7 (i) 30% of the Illinois production spending for
147	147	8 the taxable year; plus
148	148	9 (ii) 15% of the Illinois labor expenditures
149	149	10 generated by the employment of residents of geographic
150	150	11 areas of high poverty or high unemployment, as
151	151	12 determined by the Department; and .
152	152	13 (4) for an accredited production commencing on or
153	153	14 after July 1, 2023, the amount equal to:
154	154	15 (i) 30% of the Illinois production spending for
155	155	16 the taxable year; plus
156	156	17 (ii) 15% of the Illinois labor expenditures
157	157	18 generated by the employment of residents of geographic
158	158	19 areas of high poverty or high unemployment, as
159	159	20 determined by the Department; plus
160	160	21 (iii) 5% of the Illinois labor expenditures
161	161	22 generated by the employment of residents of the State
162	162	23 who reside outside of the metropolitan area; if the
163	163	24 person is a resident of a geographic area of high
164	164	25 poverty or high unemployment and also resides outside
165	165	26 of the metropolitan area, then the credit includes
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176	176	1 both subparagraph (ii) and this subparagraph (iii);
177	177	2 plus
178	178	3 (iv) if 50% or more of the total hours of principal
179	179	4 filming or taping of the production are completed in
180	180	5 the State but outside of the metropolitan area, as
181	181	6 determined by the Department, then the total amount of
182	182	7 the credit under subparagraphs (i), (ii), and (iii),
183	183	8 as applicable, shall be increased by 5%.
184	184	9 "Department" means the Department of Commerce and Economic
185	185	10 Opportunity.
186	186	11 "Director" means the Director of Commerce and Economic
187	187	12 Opportunity.
188	188	13 "Illinois labor expenditure" means salary or wages paid to
189	189	14 employees of the applicant for services on the accredited
190	190	15 production.
191	191	16 To qualify as an Illinois labor expenditure, the
192	192	17 expenditure must be:
193	193	18 (1) Reasonable in the circumstances.
194	194	19 (2) Included in the federal income tax basis of the
195	195	20 property.
196	196	21 (3) Incurred by the applicant for services on or after
197	197	22 January 1, 2004.
198	198	23 (4) Incurred for the production stages of the
199	199	24 accredited production, from the final script stage to the
200	200	25 end of the post-production stage.
201	201	26 (5) Limited to the first $25,000 of wages paid or
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212	212	1 incurred to each employee of a production commencing
213	213	2 before May 1, 2006 and the first $100,000 of wages paid or
214	214	3 incurred to each employee of a production commencing on or
215	215	4 after May 1, 2006 and prior to July 1, 2022. For
216	216	5 productions commencing on or after July 1, 2022, limited
217	217	6 to the first $500,000 of wages paid or incurred to each
218	218	7 nonresident or resident employee of a production company
219	219	8 or loan out company that provides in-State services to a
220	220	9 production, whether those wages are paid or incurred by
221	221	10 the production company, loan out company, or both, subject
222	222	11 to withholding payments provided for in Article 7 of the
223	223	12 Illinois Income Tax Act. For purposes of calculating
224	224	13 Illinois labor expenditures for a television series, the
225	225	14 nonresident wage limitations provided under this
226	226	15 subparagraph are applied to the entire season.
227	227	16 (6) For a production commencing before May 1, 2006,
228	228	17 exclusive of the salary or wages paid to or incurred for
229	229	18 the 2 highest paid employees of the production.
230	230	19 (7) Directly attributable to the accredited
231	231	20 production.
232	232	21 (8) (Blank).
233	233	22 (9) Prior to July 1, 2022, paid to persons resident in
234	234	23 Illinois at the time the payments were made. For a
235	235	24 production commencing on or after July 1, 2022, paid to
236	236	25 persons resident in Illinois and nonresidents at the time
237	237	26 the payments were made. For purposes of this subparagraph,
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248	248	1 only wages paid to nonresidents working in the following
249	249	2 positions shall be considered Illinois labor expenditures:
250	250	3 Writer, Director, Director of Photography, Production
251	251	4 Designer, Costume Designer, Production Accountant, VFX
252	252	5 Supervisor, Editor, Composer, and Actor, subject to the
253	253	6 limitations set forth under this subparagraph. For an
254	254	7 accredited Illinois production spending of $25,000,000 or
255	255	8 less, no more than 2 nonresident actors' wages shall
256	256	9 qualify as an Illinois labor expenditure. For an
257	257	10 accredited production with Illinois production spending of
258	258	11 more than $25,000,000, no more than 4 nonresident actor's
259	259	12 wages shall qualify as Illinois labor expenditures.
260	260	13 (10) Paid for services rendered in Illinois.
261	261	14 "Illinois production spending" means the expenses incurred
262	262	15 by the applicant for an accredited production, including,
263	263	16 without limitation, all of the following:
264	264	17 (1) expenses to purchase, from vendors within
265	265	18 Illinois, tangible personal property that is used in the
266	266	19 accredited production;
267	267	20 (2) expenses to acquire services, from vendors in
268	268	21 Illinois, for film production, editing, or processing; and
269	269	22 (3) for a production commencing before July 1, 2022,
270	270	23 the compensation, not to exceed $100,000 for any one
271	271	24 employee, for contractual or salaried employees who are
272	272	25 Illinois residents performing services with respect to the
273	273	26 accredited production. For a production commencing on or
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284	284	1 after July 1, 2022, the compensation, not to exceed
285	285	2 $500,000 for any one employee, for contractual or salaried
286	286	3 employees who are Illinois residents or nonresident
287	287	4 employees, subject to the limitations set forth under
288	288	5 Section 10 of this Act.
289	289	6 "Loan out company" means a personal service corporation or
290	290	7 other entity that is under contract with the taxpayer to
291	291	8 provide specified individual personnel, such as artists, crew,
292	292	9 actors, producers, or directors for the performance of
293	293	10 services used directly in a production. "Loan out company"
294	294	11 does not include entities contracted with by the taxpayer to
295	295	12 provide goods or ancillary contractor services such as
296	296	13 catering, construction, trailers, equipment, or
297	297	14 transportation.
298	298	15 "Metropolitan area" means the City of Chicago and any part
299	299	16 of the State located within 30 miles of the corporate limits of
300	300	17 the City of Chicago.
301	301	18 "Qualified production facility" means stage facilities in
302	302	19 the State in which television shows and films are or are
303	303	20 intended to be regularly produced and that contain at least
304	304	21 one sound stage of at least 15,000 square feet.
305	305	22 Rulemaking authority to implement Public Act 95-1006, if
306	306	23 any, is conditioned on the rules being adopted in accordance
307	307	24 with all provisions of the Illinois Administrative Procedure
308	308	25 Act and all rules and procedures of the Joint Committee on
309	309	26 Administrative Rules; any purported rule not so adopted, for
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320	320	1 whatever reason, is unauthorized.
321	321	2 (Source: P.A. 102-558, eff. 8-20-21; 102-700, eff. 4-19-22.)
322	322	3 Section 99. Effective date. This Act takes effect upon
323	323	4 becoming law.
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