Illinois 2023-2024 Regular Session

Illinois Senate Bill SB1535 Compare Versions

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

Old	New	Differences
1	1	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1535 Introduced 2/8/2023, by Sen. Dan McConchie SYNOPSIS AS INTRODUCED: 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65 Amends the Illinois Income Tax Act. Makes changes concerning the federal depreciation deduction and net operating losses to restore provisions that were in effect prior to Public Act 102-16. Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Provides that no tax shall be imposed under the Act for persons dying on or after the effective date of the amendatory Act or for transfers made on or after the effective date of the amendatory Act. Amends the Business Corporation Act of 1983. Provides that provisions imposing a franchise tax on corporations are repealed on December 31, 2024. Provides that, on and after January 1, 2022 and prior to January 1, 2023, the first $10,000 in liability is exempt from the franchise tax. Provides that, on and after January 1, 2023 and prior to January 1, 2024, the first $100,000 in liability is exempt from the franchise tax. Effective immediately. LRB103 25041 HLH 51375 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1535 Introduced 2/8/2023, by Sen. Dan McConchie SYNOPSIS AS INTRODUCED: 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65 Amends the Illinois Income Tax Act. Makes changes concerning the federal depreciation deduction and net operating losses to restore provisions that were in effect prior to Public Act 102-16. Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Provides that no tax shall be imposed under the Act for persons dying on or after the effective date of the amendatory Act or for transfers made on or after the effective date of the amendatory Act. Amends the Business Corporation Act of 1983. Provides that provisions imposing a franchise tax on corporations are repealed on December 31, 2024. Provides that, on and after January 1, 2022 and prior to January 1, 2023, the first $10,000 in liability is exempt from the franchise tax. Provides that, on and after January 1, 2023 and prior to January 1, 2024, the first $100,000 in liability is exempt from the franchise tax. Effective immediately. LRB103 25041 HLH 51375 b LRB103 25041 HLH 51375 b A BILL FOR
2	2	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1535 Introduced 2/8/2023, by Sen. Dan McConchie SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65
4	4	35 ILCS 5/203 from Ch. 120, par. 2-203
5	5	35 ILCS 5/207 from Ch. 120, par. 2-207
6	6	35 ILCS 405/2 from Ch. 120, par. 405A-2
7	7	35 ILCS 405/3 from Ch. 120, par. 405A-3
8	8	35 ILCS 405/4 from Ch. 120, par. 405A-4
9	9	805 ILCS 5/15.35 from Ch. 32, par. 15.35
10	10	805 ILCS 5/15.65 from Ch. 32, par. 15.65
11	11	Amends the Illinois Income Tax Act. Makes changes concerning the federal depreciation deduction and net operating losses to restore provisions that were in effect prior to Public Act 102-16. Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Provides that no tax shall be imposed under the Act for persons dying on or after the effective date of the amendatory Act or for transfers made on or after the effective date of the amendatory Act. Amends the Business Corporation Act of 1983. Provides that provisions imposing a franchise tax on corporations are repealed on December 31, 2024. Provides that, on and after January 1, 2022 and prior to January 1, 2023, the first $10,000 in liability is exempt from the franchise tax. Provides that, on and after January 1, 2023 and prior to January 1, 2024, the first $100,000 in liability is exempt from the franchise tax. Effective immediately.
12	12	LRB103 25041 HLH 51375 b LRB103 25041 HLH 51375 b
13	13	LRB103 25041 HLH 51375 b
14	14	A BILL FOR
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17	17	1 AN ACT concerning revenue.
18	18	2 Be it enacted by the People of the State of Illinois,
19	19	3 represented in the General Assembly:
20	20	4 Section 5. The Illinois Income Tax Act is amended by
21	21	5 changing Sections 203 and 207 as follows:
22	22	6 (35 ILCS 5/203) (from Ch. 120, par. 2-203)
23	23	7 Sec. 203. Base income defined.
24	24	8 (a) Individuals.
25	25	9 (1) In general. In the case of an individual, base
26	26	10 income means an amount equal to the taxpayer's adjusted
27	27	11 gross income for the taxable year as modified by paragraph
28	28	12 (2).
29	29	13 (2) Modifications. The adjusted gross income referred
30	30	14 to in paragraph (1) shall be modified by adding thereto
31	31	15 the sum of the following amounts:
32	32	16 (A) An amount equal to all amounts paid or accrued
33	33	17 to the taxpayer as interest or dividends during the
34	34	18 taxable year to the extent excluded from gross income
35	35	19 in the computation of adjusted gross income, except
36	36	20 stock dividends of qualified public utilities
37	37	21 described in Section 305(e) of the Internal Revenue
38	38	22 Code;
39	39	23 (B) An amount equal to the amount of tax imposed by
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43	43	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1535 Introduced 2/8/2023, by Sen. Dan McConchie SYNOPSIS AS INTRODUCED:
44	44	35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65 35 ILCS 5/203 from Ch. 120, par. 2-203 35 ILCS 5/207 from Ch. 120, par. 2-207 35 ILCS 405/2 from Ch. 120, par. 405A-2 35 ILCS 405/3 from Ch. 120, par. 405A-3 35 ILCS 405/4 from Ch. 120, par. 405A-4 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.65 from Ch. 32, par. 15.65
45	45	35 ILCS 5/203 from Ch. 120, par. 2-203
46	46	35 ILCS 5/207 from Ch. 120, par. 2-207
47	47	35 ILCS 405/2 from Ch. 120, par. 405A-2
48	48	35 ILCS 405/3 from Ch. 120, par. 405A-3
49	49	35 ILCS 405/4 from Ch. 120, par. 405A-4
50	50	805 ILCS 5/15.35 from Ch. 32, par. 15.35
51	51	805 ILCS 5/15.65 from Ch. 32, par. 15.65
52	52	Amends the Illinois Income Tax Act. Makes changes concerning the federal depreciation deduction and net operating losses to restore provisions that were in effect prior to Public Act 102-16. Amends the Illinois Estate and Generation-Skipping Transfer Tax Act. Provides that no tax shall be imposed under the Act for persons dying on or after the effective date of the amendatory Act or for transfers made on or after the effective date of the amendatory Act. Amends the Business Corporation Act of 1983. Provides that provisions imposing a franchise tax on corporations are repealed on December 31, 2024. Provides that, on and after January 1, 2022 and prior to January 1, 2023, the first $10,000 in liability is exempt from the franchise tax. Provides that, on and after January 1, 2023 and prior to January 1, 2024, the first $100,000 in liability is exempt from the franchise tax. Effective immediately.
53	53	LRB103 25041 HLH 51375 b LRB103 25041 HLH 51375 b
54	54	LRB103 25041 HLH 51375 b
55	55	A BILL FOR
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61	61	35 ILCS 5/203 from Ch. 120, par. 2-203
62	62	35 ILCS 5/207 from Ch. 120, par. 2-207
63	63	35 ILCS 405/2 from Ch. 120, par. 405A-2
64	64	35 ILCS 405/3 from Ch. 120, par. 405A-3
65	65	35 ILCS 405/4 from Ch. 120, par. 405A-4
66	66	805 ILCS 5/15.35 from Ch. 32, par. 15.35
67	67	805 ILCS 5/15.65 from Ch. 32, par. 15.65
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86	86	1 this Act to the extent deducted from gross income in
87	87	2 the computation of adjusted gross income for the
88	88	3 taxable year;
89	89	4 (C) An amount equal to the amount received during
90	90	5 the taxable year as a recovery or refund of real
91	91	6 property taxes paid with respect to the taxpayer's
92	92	7 principal residence under the Revenue Act of 1939 and
93	93	8 for which a deduction was previously taken under
94	94	9 subparagraph (L) of this paragraph (2) prior to July
95	95	10 1, 1991, the retrospective application date of Article
96	96	11 4 of Public Act 87-17. In the case of multi-unit or
97	97	12 multi-use structures and farm dwellings, the taxes on
98	98	13 the taxpayer's principal residence shall be that
99	99	14 portion of the total taxes for the entire property
100	100	15 which is attributable to such principal residence;
101	101	16 (D) An amount equal to the amount of the capital
102	102	17 gain deduction allowable under the Internal Revenue
103	103	18 Code, to the extent deducted from gross income in the
104	104	19 computation of adjusted gross income;
105	105	20 (D-5) An amount, to the extent not included in
106	106	21 adjusted gross income, equal to the amount of money
107	107	22 withdrawn by the taxpayer in the taxable year from a
108	108	23 medical care savings account and the interest earned
109	109	24 on the account in the taxable year of a withdrawal
110	110	25 pursuant to subsection (b) of Section 20 of the
111	111	26 Medical Care Savings Account Act or subsection (b) of
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122	122	1 Section 20 of the Medical Care Savings Account Act of
123	123	2 2000;
124	124	3 (D-10) For taxable years ending after December 31,
125	125	4 1997, an amount equal to any eligible remediation
126	126	5 costs that the individual deducted in computing
127	127	6 adjusted gross income and for which the individual
128	128	7 claims a credit under subsection (l) of Section 201;
129	129	8 (D-15) For taxable years 2001 and thereafter, an
130	130	9 amount equal to the bonus depreciation deduction taken
131	131	10 on the taxpayer's federal income tax return for the
132	132	11 taxable year under subsection (k) of Section 168 of
133	133	12 the Internal Revenue Code;
134	134	13 (D-16) If the taxpayer sells, transfers, abandons,
135	135	14 or otherwise disposes of property for which the
136	136	15 taxpayer was required in any taxable year to make an
137	137	16 addition modification under subparagraph (D-15), then
138	138	17 an amount equal to the aggregate amount of the
139	139	18 deductions taken in all taxable years under
140	140	19 subparagraph (Z) with respect to that property.
141	141	20 If the taxpayer continues to own property through
142	142	21 the last day of the last tax year for which the
143	143	22 taxpayer may claim a depreciation deduction for
144	144	23 federal income tax purposes a subtraction is allowed
145	145	24 with respect to that property under subparagraph (Z)
146	146	25 and for which the taxpayer was allowed in any taxable
147	147	26 year to make a subtraction modification under
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158	158	1 subparagraph (Z), then an amount equal to that
159	159	2 subtraction modification.
160	160	3 The taxpayer is required to make the addition
161	161	4 modification under this subparagraph only once with
162	162	5 respect to any one piece of property;
163	163	6 (D-17) An amount equal to the amount otherwise
164	164	7 allowed as a deduction in computing base income for
165	165	8 interest paid, accrued, or incurred, directly or
166	166	9 indirectly, (i) for taxable years ending on or after
167	167	10 December 31, 2004, to a foreign person who would be a
168	168	11 member of the same unitary business group but for the
169	169	12 fact that foreign person's business activity outside
170	170	13 the United States is 80% or more of the foreign
171	171	14 person's total business activity and (ii) for taxable
172	172	15 years ending on or after December 31, 2008, to a person
173	173	16 who would be a member of the same unitary business
174	174	17 group but for the fact that the person is prohibited
175	175	18 under Section 1501(a)(27) from being included in the
176	176	19 unitary business group because he or she is ordinarily
177	177	20 required to apportion business income under different
178	178	21 subsections of Section 304. The addition modification
179	179	22 required by this subparagraph shall be reduced to the
180	180	23 extent that dividends were included in base income of
181	181	24 the unitary group for the same taxable year and
182	182	25 received by the taxpayer or by a member of the
183	183	26 taxpayer's unitary business group (including amounts
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194	194	1 included in gross income under Sections 951 through
195	195	2 964 of the Internal Revenue Code and amounts included
196	196	3 in gross income under Section 78 of the Internal
197	197	4 Revenue Code) with respect to the stock of the same
198	198	5 person to whom the interest was paid, accrued, or
199	199	6 incurred.
200	200	7 This paragraph shall not apply to the following:
201	201	8 (i) an item of interest paid, accrued, or
202	202	9 incurred, directly or indirectly, to a person who
203	203	10 is subject in a foreign country or state, other
204	204	11 than a state which requires mandatory unitary
205	205	12 reporting, to a tax on or measured by net income
206	206	13 with respect to such interest; or
207	207	14 (ii) an item of interest paid, accrued, or
208	208	15 incurred, directly or indirectly, to a person if
209	209	16 the taxpayer can establish, based on a
210	210	17 preponderance of the evidence, both of the
211	211	18 following:
212	212	19 (a) the person, during the same taxable
213	213	20 year, paid, accrued, or incurred, the interest
214	214	21 to a person that is not a related member, and
215	215	22 (b) the transaction giving rise to the
216	216	23 interest expense between the taxpayer and the
217	217	24 person did not have as a principal purpose the
218	218	25 avoidance of Illinois income tax, and is paid
219	219	26 pursuant to a contract or agreement that
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230	230	1 reflects an arm's-length interest rate and
231	231	2 terms; or
232	232	3 (iii) the taxpayer can establish, based on
233	233	4 clear and convincing evidence, that the interest
234	234	5 paid, accrued, or incurred relates to a contract
235	235	6 or agreement entered into at arm's-length rates
236	236	7 and terms and the principal purpose for the
237	237	8 payment is not federal or Illinois tax avoidance;
238	238	9 or
239	239	10 (iv) an item of interest paid, accrued, or
240	240	11 incurred, directly or indirectly, to a person if
241	241	12 the taxpayer establishes by clear and convincing
242	242	13 evidence that the adjustments are unreasonable; or
243	243	14 if the taxpayer and the Director agree in writing
244	244	15 to the application or use of an alternative method
245	245	16 of apportionment under Section 304(f).
246	246	17 Nothing in this subsection shall preclude the
247	247	18 Director from making any other adjustment
248	248	19 otherwise allowed under Section 404 of this Act
249	249	20 for any tax year beginning after the effective
250	250	21 date of this amendment provided such adjustment is
251	251	22 made pursuant to regulation adopted by the
252	252	23 Department and such regulations provide methods
253	253	24 and standards by which the Department will utilize
254	254	25 its authority under Section 404 of this Act;
255	255	26 (D-18) An amount equal to the amount of intangible
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266	266	1 expenses and costs otherwise allowed as a deduction in
267	267	2 computing base income, and that were paid, accrued, or
268	268	3 incurred, directly or indirectly, (i) for taxable
269	269	4 years ending on or after December 31, 2004, to a
270	270	5 foreign person who would be a member of the same
271	271	6 unitary business group but for the fact that the
272	272	7 foreign person's business activity outside the United
273	273	8 States is 80% or more of that person's total business
274	274	9 activity and (ii) for taxable years ending on or after
275	275	10 December 31, 2008, to a person who would be a member of
276	276	11 the same unitary business group but for the fact that
277	277	12 the person is prohibited under Section 1501(a)(27)
278	278	13 from being included in the unitary business group
279	279	14 because he or she is ordinarily required to apportion
280	280	15 business income under different subsections of Section
281	281	16 304. The addition modification required by this
282	282	17 subparagraph shall be reduced to the extent that
283	283	18 dividends were included in base income of the unitary
284	284	19 group for the same taxable year and received by the
285	285	20 taxpayer or by a member of the taxpayer's unitary
286	286	21 business group (including amounts included in gross
287	287	22 income under Sections 951 through 964 of the Internal
288	288	23 Revenue Code and amounts included in gross income
289	289	24 under Section 78 of the Internal Revenue Code) with
290	290	25 respect to the stock of the same person to whom the
291	291	26 intangible expenses and costs were directly or
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302	302	1 indirectly paid, incurred, or accrued. The preceding
303	303	2 sentence does not apply to the extent that the same
304	304	3 dividends caused a reduction to the addition
305	305	4 modification required under Section 203(a)(2)(D-17) of
306	306	5 this Act. As used in this subparagraph, the term
307	307	6 "intangible expenses and costs" includes (1) expenses,
308	308	7 losses, and costs for, or related to, the direct or
309	309	8 indirect acquisition, use, maintenance or management,
310	310	9 ownership, sale, exchange, or any other disposition of
311	311	10 intangible property; (2) losses incurred, directly or
312	312	11 indirectly, from factoring transactions or discounting
313	313	12 transactions; (3) royalty, patent, technical, and
314	314	13 copyright fees; (4) licensing fees; and (5) other
315	315	14 similar expenses and costs. For purposes of this
316	316	15 subparagraph, "intangible property" includes patents,
317	317	16 patent applications, trade names, trademarks, service
318	318	17 marks, copyrights, mask works, trade secrets, and
319	319	18 similar types of intangible assets.
320	320	19 This paragraph shall not apply to the following:
321	321	20 (i) any item of intangible expenses or costs
322	322	21 paid, accrued, or incurred, directly or
323	323	22 indirectly, from a transaction with a person who
324	324	23 is subject in a foreign country or state, other
325	325	24 than a state which requires mandatory unitary
326	326	25 reporting, to a tax on or measured by net income
327	327	26 with respect to such item; or
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338	338	1 (ii) any item of intangible expense or cost
339	339	2 paid, accrued, or incurred, directly or
340	340	3 indirectly, if the taxpayer can establish, based
341	341	4 on a preponderance of the evidence, both of the
342	342	5 following:
343	343	6 (a) the person during the same taxable
344	344	7 year paid, accrued, or incurred, the
345	345	8 intangible expense or cost to a person that is
346	346	9 not a related member, and
347	347	10 (b) the transaction giving rise to the
348	348	11 intangible expense or cost between the
349	349	12 taxpayer and the person did not have as a
350	350	13 principal purpose the avoidance of Illinois
351	351	14 income tax, and is paid pursuant to a contract
352	352	15 or agreement that reflects arm's-length terms;
353	353	16 or
354	354	17 (iii) any item of intangible expense or cost
355	355	18 paid, accrued, or incurred, directly or
356	356	19 indirectly, from a transaction with a person if
357	357	20 the taxpayer establishes by clear and convincing
358	358	21 evidence, that the adjustments are unreasonable;
359	359	22 or if the taxpayer and the Director agree in
360	360	23 writing to the application or use of an
361	361	24 alternative method of apportionment under Section
362	362	25 304(f);
363	363	26 Nothing in this subsection shall preclude the
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374	374	1 Director from making any other adjustment
375	375	2 otherwise allowed under Section 404 of this Act
376	376	3 for any tax year beginning after the effective
377	377	4 date of this amendment provided such adjustment is
378	378	5 made pursuant to regulation adopted by the
379	379	6 Department and such regulations provide methods
380	380	7 and standards by which the Department will utilize
381	381	8 its authority under Section 404 of this Act;
382	382	9 (D-19) For taxable years ending on or after
383	383	10 December 31, 2008, an amount equal to the amount of
384	384	11 insurance premium expenses and costs otherwise allowed
385	385	12 as a deduction in computing base income, and that were
386	386	13 paid, accrued, or incurred, directly or indirectly, to
387	387	14 a person who would be a member of the same unitary
388	388	15 business group but for the fact that the person is
389	389	16 prohibited under Section 1501(a)(27) from being
390	390	17 included in the unitary business group because he or
391	391	18 she is ordinarily required to apportion business
392	392	19 income under different subsections of Section 304. The
393	393	20 addition modification required by this subparagraph
394	394	21 shall be reduced to the extent that dividends were
395	395	22 included in base income of the unitary group for the
396	396	23 same taxable year and received by the taxpayer or by a
397	397	24 member of the taxpayer's unitary business group
398	398	25 (including amounts included in gross income under
399	399	26 Sections 951 through 964 of the Internal Revenue Code
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410	410	1 and amounts included in gross income under Section 78
411	411	2 of the Internal Revenue Code) with respect to the
412	412	3 stock of the same person to whom the premiums and costs
413	413	4 were directly or indirectly paid, incurred, or
414	414	5 accrued. The preceding sentence does not apply to the
415	415	6 extent that the same dividends caused a reduction to
416	416	7 the addition modification required under Section
417	417	8 203(a)(2)(D-17) or Section 203(a)(2)(D-18) of this
418	418	9 Act;
419	419	10 (D-20) For taxable years beginning on or after
420	420	11 January 1, 2002 and ending on or before December 31,
421	421	12 2006, in the case of a distribution from a qualified
422	422	13 tuition program under Section 529 of the Internal
423	423	14 Revenue Code, other than (i) a distribution from a
424	424	15 College Savings Pool created under Section 16.5 of the
425	425	16 State Treasurer Act or (ii) a distribution from the
426	426	17 Illinois Prepaid Tuition Trust Fund, an amount equal
427	427	18 to the amount excluded from gross income under Section
428	428	19 529(c)(3)(B). For taxable years beginning on or after
429	429	20 January 1, 2007, in the case of a distribution from a
430	430	21 qualified tuition program under Section 529 of the
431	431	22 Internal Revenue Code, other than (i) a distribution
432	432	23 from a College Savings Pool created under Section 16.5
433	433	24 of the State Treasurer Act, (ii) a distribution from
434	434	25 the Illinois Prepaid Tuition Trust Fund, or (iii) a
435	435	26 distribution from a qualified tuition program under
436	436
437	437
438	438
439	439
440	440
441	441	SB1535 - 11 - LRB103 25041 HLH 51375 b
442	442
443	443
444	444	SB1535- 12 -LRB103 25041 HLH 51375 b SB1535 - 12 - LRB103 25041 HLH 51375 b
445	445	SB1535 - 12 - LRB103 25041 HLH 51375 b
446	446	1 Section 529 of the Internal Revenue Code that (I)
447	447	2 adopts and determines that its offering materials
448	448	3 comply with the College Savings Plans Network's
449	449	4 disclosure principles and (II) has made reasonable
450	450	5 efforts to inform in-state residents of the existence
451	451	6 of in-state qualified tuition programs by informing
452	452	7 Illinois residents directly and, where applicable, to
453	453	8 inform financial intermediaries distributing the
454	454	9 program to inform in-state residents of the existence
455	455	10 of in-state qualified tuition programs at least
456	456	11 annually, an amount equal to the amount excluded from
457	457	12 gross income under Section 529(c)(3)(B).
458	458	13 For the purposes of this subparagraph (D-20), a
459	459	14 qualified tuition program has made reasonable efforts
460	460	15 if it makes disclosures (which may use the term
461	461	16 "in-state program" or "in-state plan" and need not
462	462	17 specifically refer to Illinois or its qualified
463	463	18 programs by name) (i) directly to prospective
464	464	19 participants in its offering materials or makes a
465	465	20 public disclosure, such as a website posting; and (ii)
466	466	21 where applicable, to intermediaries selling the
467	467	22 out-of-state program in the same manner that the
468	468	23 out-of-state program distributes its offering
469	469	24 materials;
470	470	25 (D-20.5) For taxable years beginning on or after
471	471	26 January 1, 2018, in the case of a distribution from a
472	472
473	473
474	474
475	475
476	476
477	477	SB1535 - 12 - LRB103 25041 HLH 51375 b
478	478
479	479
480	480	SB1535- 13 -LRB103 25041 HLH 51375 b SB1535 - 13 - LRB103 25041 HLH 51375 b
481	481	SB1535 - 13 - LRB103 25041 HLH 51375 b
482	482	1 qualified ABLE program under Section 529A of the
483	483	2 Internal Revenue Code, other than a distribution from
484	484	3 a qualified ABLE program created under Section 16.6 of
485	485	4 the State Treasurer Act, an amount equal to the amount
486	486	5 excluded from gross income under Section 529A(c)(1)(B)
487	487	6 of the Internal Revenue Code;
488	488	7 (D-21) For taxable years beginning on or after
489	489	8 January 1, 2007, in the case of transfer of moneys from
490	490	9 a qualified tuition program under Section 529 of the
491	491	10 Internal Revenue Code that is administered by the
492	492	11 State to an out-of-state program, an amount equal to
493	493	12 the amount of moneys previously deducted from base
494	494	13 income under subsection (a)(2)(Y) of this Section;
495	495	14 (D-21.5) For taxable years beginning on or after
496	496	15 January 1, 2018, in the case of the transfer of moneys
497	497	16 from a qualified tuition program under Section 529 or
498	498	17 a qualified ABLE program under Section 529A of the
499	499	18 Internal Revenue Code that is administered by this
500	500	19 State to an ABLE account established under an
501	501	20 out-of-state ABLE account program, an amount equal to
502	502	21 the contribution component of the transferred amount
503	503	22 that was previously deducted from base income under
504	504	23 subsection (a)(2)(Y) or subsection (a)(2)(HH) of this
505	505	24 Section;
506	506	25 (D-22) For taxable years beginning on or after
507	507	26 January 1, 2009, and prior to January 1, 2018, in the
508	508
509	509
510	510
511	511
512	512
513	513	SB1535 - 13 - LRB103 25041 HLH 51375 b
514	514
515	515
516	516	SB1535- 14 -LRB103 25041 HLH 51375 b SB1535 - 14 - LRB103 25041 HLH 51375 b
517	517	SB1535 - 14 - LRB103 25041 HLH 51375 b
518	518	1 case of a nonqualified withdrawal or refund of moneys
519	519	2 from a qualified tuition program under Section 529 of
520	520	3 the Internal Revenue Code administered by the State
521	521	4 that is not used for qualified expenses at an eligible
522	522	5 education institution, an amount equal to the
523	523	6 contribution component of the nonqualified withdrawal
524	524	7 or refund that was previously deducted from base
525	525	8 income under subsection (a)(2)(y) of this Section,
526	526	9 provided that the withdrawal or refund did not result
527	527	10 from the beneficiary's death or disability. For
528	528	11 taxable years beginning on or after January 1, 2018:
529	529	12 (1) in the case of a nonqualified withdrawal or
530	530	13 refund, as defined under Section 16.5 of the State
531	531	14 Treasurer Act, of moneys from a qualified tuition
532	532	15 program under Section 529 of the Internal Revenue Code
533	533	16 administered by the State, an amount equal to the
534	534	17 contribution component of the nonqualified withdrawal
535	535	18 or refund that was previously deducted from base
536	536	19 income under subsection (a)(2)(Y) of this Section, and
537	537	20 (2) in the case of a nonqualified withdrawal or refund
538	538	21 from a qualified ABLE program under Section 529A of
539	539	22 the Internal Revenue Code administered by the State
540	540	23 that is not used for qualified disability expenses, an
541	541	24 amount equal to the contribution component of the
542	542	25 nonqualified withdrawal or refund that was previously
543	543	26 deducted from base income under subsection (a)(2)(HH)
544	544
545	545
546	546
547	547
548	548
549	549	SB1535 - 14 - LRB103 25041 HLH 51375 b
550	550
551	551
552	552	SB1535- 15 -LRB103 25041 HLH 51375 b SB1535 - 15 - LRB103 25041 HLH 51375 b
553	553	SB1535 - 15 - LRB103 25041 HLH 51375 b
554	554	1 of this Section;
555	555	2 (D-23) An amount equal to the credit allowable to
556	556	3 the taxpayer under Section 218(a) of this Act,
557	557	4 determined without regard to Section 218(c) of this
558	558	5 Act;
559	559	6 (D-24) For taxable years ending on or after
560	560	7 December 31, 2017, an amount equal to the deduction
561	561	8 allowed under Section 199 of the Internal Revenue Code
562	562	9 for the taxable year;
563	563	10 (D-25) In the case of a resident, an amount equal
564	564	11 to the amount of tax for which a credit is allowed
565	565	12 pursuant to Section 201(p)(7) of this Act;
566	566	13 and by deducting from the total so obtained the sum of the
567	567	14 following amounts:
568	568	15 (E) For taxable years ending before December 31,
569	569	16 2001, any amount included in such total in respect of
570	570	17 any compensation (including but not limited to any
571	571	18 compensation paid or accrued to a serviceman while a
572	572	19 prisoner of war or missing in action) paid to a
573	573	20 resident by reason of being on active duty in the Armed
574	574	21 Forces of the United States and in respect of any
575	575	22 compensation paid or accrued to a resident who as a
576	576	23 governmental employee was a prisoner of war or missing
577	577	24 in action, and in respect of any compensation paid to a
578	578	25 resident in 1971 or thereafter for annual training
579	579	26 performed pursuant to Sections 502 and 503, Title 32,
580	580
581	581
582	582
583	583
584	584
585	585	SB1535 - 15 - LRB103 25041 HLH 51375 b
586	586
587	587
588	588	SB1535- 16 -LRB103 25041 HLH 51375 b SB1535 - 16 - LRB103 25041 HLH 51375 b
589	589	SB1535 - 16 - LRB103 25041 HLH 51375 b
590	590	1 United States Code as a member of the Illinois
591	591	2 National Guard or, beginning with taxable years ending
592	592	3 on or after December 31, 2007, the National Guard of
593	593	4 any other state. For taxable years ending on or after
594	594	5 December 31, 2001, any amount included in such total
595	595	6 in respect of any compensation (including but not
596	596	7 limited to any compensation paid or accrued to a
597	597	8 serviceman while a prisoner of war or missing in
598	598	9 action) paid to a resident by reason of being a member
599	599	10 of any component of the Armed Forces of the United
600	600	11 States and in respect of any compensation paid or
601	601	12 accrued to a resident who as a governmental employee
602	602	13 was a prisoner of war or missing in action, and in
603	603	14 respect of any compensation paid to a resident in 2001
604	604	15 or thereafter by reason of being a member of the
605	605	16 Illinois National Guard or, beginning with taxable
606	606	17 years ending on or after December 31, 2007, the
607	607	18 National Guard of any other state. The provisions of
608	608	19 this subparagraph (E) are exempt from the provisions
609	609	20 of Section 250;
610	610	21 (F) An amount equal to all amounts included in
611	611	22 such total pursuant to the provisions of Sections
612	612	23 402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and
613	613	24 408 of the Internal Revenue Code, or included in such
614	614	25 total as distributions under the provisions of any
615	615	26 retirement or disability plan for employees of any
616	616
617	617
618	618
619	619
620	620
621	621	SB1535 - 16 - LRB103 25041 HLH 51375 b
622	622
623	623
624	624	SB1535- 17 -LRB103 25041 HLH 51375 b SB1535 - 17 - LRB103 25041 HLH 51375 b
625	625	SB1535 - 17 - LRB103 25041 HLH 51375 b
626	626	1 governmental agency or unit, or retirement payments to
627	627	2 retired partners, which payments are excluded in
628	628	3 computing net earnings from self employment by Section
629	629	4 1402 of the Internal Revenue Code and regulations
630	630	5 adopted pursuant thereto;
631	631	6 (G) The valuation limitation amount;
632	632	7 (H) An amount equal to the amount of any tax
633	633	8 imposed by this Act which was refunded to the taxpayer
634	634	9 and included in such total for the taxable year;
635	635	10 (I) An amount equal to all amounts included in
636	636	11 such total pursuant to the provisions of Section 111
637	637	12 of the Internal Revenue Code as a recovery of items
638	638	13 previously deducted from adjusted gross income in the
639	639	14 computation of taxable income;
640	640	15 (J) An amount equal to those dividends included in
641	641	16 such total which were paid by a corporation which
642	642	17 conducts business operations in a River Edge
643	643	18 Redevelopment Zone or zones created under the River
644	644	19 Edge Redevelopment Zone Act, and conducts
645	645	20 substantially all of its operations in a River Edge
646	646	21 Redevelopment Zone or zones. This subparagraph (J) is
647	647	22 exempt from the provisions of Section 250;
648	648	23 (K) An amount equal to those dividends included in
649	649	24 such total that were paid by a corporation that
650	650	25 conducts business operations in a federally designated
651	651	26 Foreign Trade Zone or Sub-Zone and that is designated
652	652
653	653
654	654
655	655
656	656
657	657	SB1535 - 17 - LRB103 25041 HLH 51375 b
658	658
659	659
660	660	SB1535- 18 -LRB103 25041 HLH 51375 b SB1535 - 18 - LRB103 25041 HLH 51375 b
661	661	SB1535 - 18 - LRB103 25041 HLH 51375 b
662	662	1 a High Impact Business located in Illinois; provided
663	663	2 that dividends eligible for the deduction provided in
664	664	3 subparagraph (J) of paragraph (2) of this subsection
665	665	4 shall not be eligible for the deduction provided under
666	666	5 this subparagraph (K);
667	667	6 (L) For taxable years ending after December 31,
668	668	7 1983, an amount equal to all social security benefits
669	669	8 and railroad retirement benefits included in such
670	670	9 total pursuant to Sections 72(r) and 86 of the
671	671	10 Internal Revenue Code;
672	672	11 (M) With the exception of any amounts subtracted
673	673	12 under subparagraph (N), an amount equal to the sum of
674	674	13 all amounts disallowed as deductions by (i) Sections
675	675	14 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
676	676	15 and all amounts of expenses allocable to interest and
677	677	16 disallowed as deductions by Section 265(a)(1) of the
678	678	17 Internal Revenue Code; and (ii) for taxable years
679	679	18 ending on or after August 13, 1999, Sections
680	680	19 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
681	681	20 Internal Revenue Code, plus, for taxable years ending
682	682	21 on or after December 31, 2011, Section 45G(e)(3) of
683	683	22 the Internal Revenue Code and, for taxable years
684	684	23 ending on or after December 31, 2008, any amount
685	685	24 included in gross income under Section 87 of the
686	686	25 Internal Revenue Code; the provisions of this
687	687	26 subparagraph are exempt from the provisions of Section
688	688
689	689
690	690
691	691
692	692
693	693	SB1535 - 18 - LRB103 25041 HLH 51375 b
694	694
695	695
696	696	SB1535- 19 -LRB103 25041 HLH 51375 b SB1535 - 19 - LRB103 25041 HLH 51375 b
697	697	SB1535 - 19 - LRB103 25041 HLH 51375 b
698	698	1 250;
699	699	2 (N) An amount equal to all amounts included in
700	700	3 such total which are exempt from taxation by this
701	701	4 State either by reason of its statutes or Constitution
702	702	5 or by reason of the Constitution, treaties or statutes
703	703	6 of the United States; provided that, in the case of any
704	704	7 statute of this State that exempts income derived from
705	705	8 bonds or other obligations from the tax imposed under
706	706	9 this Act, the amount exempted shall be the interest
707	707	10 net of bond premium amortization;
708	708	11 (O) An amount equal to any contribution made to a
709	709	12 job training project established pursuant to the Tax
710	710	13 Increment Allocation Redevelopment Act;
711	711	14 (P) An amount equal to the amount of the deduction
712	712	15 used to compute the federal income tax credit for
713	713	16 restoration of substantial amounts held under claim of
714	714	17 right for the taxable year pursuant to Section 1341 of
715	715	18 the Internal Revenue Code or of any itemized deduction
716	716	19 taken from adjusted gross income in the computation of
717	717	20 taxable income for restoration of substantial amounts
718	718	21 held under claim of right for the taxable year;
719	719	22 (Q) An amount equal to any amounts included in
720	720	23 such total, received by the taxpayer as an
721	721	24 acceleration in the payment of life, endowment or
722	722	25 annuity benefits in advance of the time they would
723	723	26 otherwise be payable as an indemnity for a terminal
724	724
725	725
726	726
727	727
728	728
729	729	SB1535 - 19 - LRB103 25041 HLH 51375 b
730	730
731	731
732	732	SB1535- 20 -LRB103 25041 HLH 51375 b SB1535 - 20 - LRB103 25041 HLH 51375 b
733	733	SB1535 - 20 - LRB103 25041 HLH 51375 b
734	734	1 illness;
735	735	2 (R) An amount equal to the amount of any federal or
736	736	3 State bonus paid to veterans of the Persian Gulf War;
737	737	4 (S) An amount, to the extent included in adjusted
738	738	5 gross income, equal to the amount of a contribution
739	739	6 made in the taxable year on behalf of the taxpayer to a
740	740	7 medical care savings account established under the
741	741	8 Medical Care Savings Account Act or the Medical Care
742	742	9 Savings Account Act of 2000 to the extent the
743	743	10 contribution is accepted by the account administrator
744	744	11 as provided in that Act;
745	745	12 (T) An amount, to the extent included in adjusted
746	746	13 gross income, equal to the amount of interest earned
747	747	14 in the taxable year on a medical care savings account
748	748	15 established under the Medical Care Savings Account Act
749	749	16 or the Medical Care Savings Account Act of 2000 on
750	750	17 behalf of the taxpayer, other than interest added
751	751	18 pursuant to item (D-5) of this paragraph (2);
752	752	19 (U) For one taxable year beginning on or after
753	753	20 January 1, 1994, an amount equal to the total amount of
754	754	21 tax imposed and paid under subsections (a) and (b) of
755	755	22 Section 201 of this Act on grant amounts received by
756	756	23 the taxpayer under the Nursing Home Grant Assistance
757	757	24 Act during the taxpayer's taxable years 1992 and 1993;
758	758	25 (V) Beginning with tax years ending on or after
759	759	26 December 31, 1995 and ending with tax years ending on
760	760
761	761
762	762
763	763
764	764
765	765	SB1535 - 20 - LRB103 25041 HLH 51375 b
766	766
767	767
768	768	SB1535- 21 -LRB103 25041 HLH 51375 b SB1535 - 21 - LRB103 25041 HLH 51375 b
769	769	SB1535 - 21 - LRB103 25041 HLH 51375 b
770	770	1 or before December 31, 2004, an amount equal to the
771	771	2 amount paid by a taxpayer who is a self-employed
772	772	3 taxpayer, a partner of a partnership, or a shareholder
773	773	4 in a Subchapter S corporation for health insurance or
774	774	5 long-term care insurance for that taxpayer or that
775	775	6 taxpayer's spouse or dependents, to the extent that
776	776	7 the amount paid for that health insurance or long-term
777	777	8 care insurance may be deducted under Section 213 of
778	778	9 the Internal Revenue Code, has not been deducted on
779	779	10 the federal income tax return of the taxpayer, and
780	780	11 does not exceed the taxable income attributable to
781	781	12 that taxpayer's income, self-employment income, or
782	782	13 Subchapter S corporation income; except that no
783	783	14 deduction shall be allowed under this item (V) if the
784	784	15 taxpayer is eligible to participate in any health
785	785	16 insurance or long-term care insurance plan of an
786	786	17 employer of the taxpayer or the taxpayer's spouse. The
787	787	18 amount of the health insurance and long-term care
788	788	19 insurance subtracted under this item (V) shall be
789	789	20 determined by multiplying total health insurance and
790	790	21 long-term care insurance premiums paid by the taxpayer
791	791	22 times a number that represents the fractional
792	792	23 percentage of eligible medical expenses under Section
793	793	24 213 of the Internal Revenue Code of 1986 not actually
794	794	25 deducted on the taxpayer's federal income tax return;
795	795	26 (W) For taxable years beginning on or after
796	796
797	797
798	798
799	799
800	800
801	801	SB1535 - 21 - LRB103 25041 HLH 51375 b
802	802
803	803
804	804	SB1535- 22 -LRB103 25041 HLH 51375 b SB1535 - 22 - LRB103 25041 HLH 51375 b
805	805	SB1535 - 22 - LRB103 25041 HLH 51375 b
806	806	1 January 1, 1998, all amounts included in the
807	807	2 taxpayer's federal gross income in the taxable year
808	808	3 from amounts converted from a regular IRA to a Roth
809	809	4 IRA. This paragraph is exempt from the provisions of
810	810	5 Section 250;
811	811	6 (X) For taxable year 1999 and thereafter, an
812	812	7 amount equal to the amount of any (i) distributions,
813	813	8 to the extent includible in gross income for federal
814	814	9 income tax purposes, made to the taxpayer because of
815	815	10 his or her status as a victim of persecution for racial
816	816	11 or religious reasons by Nazi Germany or any other Axis
817	817	12 regime or as an heir of the victim and (ii) items of
818	818	13 income, to the extent includible in gross income for
819	819	14 federal income tax purposes, attributable to, derived
820	820	15 from or in any way related to assets stolen from,
821	821	16 hidden from, or otherwise lost to a victim of
822	822	17 persecution for racial or religious reasons by Nazi
823	823	18 Germany or any other Axis regime immediately prior to,
824	824	19 during, and immediately after World War II, including,
825	825	20 but not limited to, interest on the proceeds
826	826	21 receivable as insurance under policies issued to a
827	827	22 victim of persecution for racial or religious reasons
828	828	23 by Nazi Germany or any other Axis regime by European
829	829	24 insurance companies immediately prior to and during
830	830	25 World War II; provided, however, this subtraction from
831	831	26 federal adjusted gross income does not apply to assets
832	832
833	833
834	834
835	835
836	836
837	837	SB1535 - 22 - LRB103 25041 HLH 51375 b
838	838
839	839
840	840	SB1535- 23 -LRB103 25041 HLH 51375 b SB1535 - 23 - LRB103 25041 HLH 51375 b
841	841	SB1535 - 23 - LRB103 25041 HLH 51375 b
842	842	1 acquired with such assets or with the proceeds from
843	843	2 the sale of such assets; provided, further, this
844	844	3 paragraph shall only apply to a taxpayer who was the
845	845	4 first recipient of such assets after their recovery
846	846	5 and who is a victim of persecution for racial or
847	847	6 religious reasons by Nazi Germany or any other Axis
848	848	7 regime or as an heir of the victim. The amount of and
849	849	8 the eligibility for any public assistance, benefit, or
850	850	9 similar entitlement is not affected by the inclusion
851	851	10 of items (i) and (ii) of this paragraph in gross income
852	852	11 for federal income tax purposes. This paragraph is
853	853	12 exempt from the provisions of Section 250;
854	854	13 (Y) For taxable years beginning on or after
855	855	14 January 1, 2002 and ending on or before December 31,
856	856	15 2004, moneys contributed in the taxable year to a
857	857	16 College Savings Pool account under Section 16.5 of the
858	858	17 State Treasurer Act, except that amounts excluded from
859	859	18 gross income under Section 529(c)(3)(C)(i) of the
860	860	19 Internal Revenue Code shall not be considered moneys
861	861	20 contributed under this subparagraph (Y). For taxable
862	862	21 years beginning on or after January 1, 2005, a maximum
863	863	22 of $10,000 contributed in the taxable year to (i) a
864	864	23 College Savings Pool account under Section 16.5 of the
865	865	24 State Treasurer Act or (ii) the Illinois Prepaid
866	866	25 Tuition Trust Fund, except that amounts excluded from
867	867	26 gross income under Section 529(c)(3)(C)(i) of the
868	868
869	869
870	870
871	871
872	872
873	873	SB1535 - 23 - LRB103 25041 HLH 51375 b
874	874
875	875
876	876	SB1535- 24 -LRB103 25041 HLH 51375 b SB1535 - 24 - LRB103 25041 HLH 51375 b
877	877	SB1535 - 24 - LRB103 25041 HLH 51375 b
878	878	1 Internal Revenue Code shall not be considered moneys
879	879	2 contributed under this subparagraph (Y). For purposes
880	880	3 of this subparagraph, contributions made by an
881	881	4 employer on behalf of an employee, or matching
882	882	5 contributions made by an employee, shall be treated as
883	883	6 made by the employee. This subparagraph (Y) is exempt
884	884	7 from the provisions of Section 250;
885	885	8 (Z) For taxable years 2001 and thereafter, for the
886	886	9 taxable year in which the bonus depreciation deduction
887	887	10 is taken on the taxpayer's federal income tax return
888	888	11 under subsection (k) of Section 168 of the Internal
889	889	12 Revenue Code and for each applicable taxable year
890	890	13 thereafter, an amount equal to "x", where:
891	891	14 (1) "y" equals the amount of the depreciation
892	892	15 deduction taken for the taxable year on the
893	893	16 taxpayer's federal income tax return on property
894	894	17 for which the bonus depreciation deduction was
895	895	18 taken in any year under subsection (k) of Section
896	896	19 168 of the Internal Revenue Code, but not
897	897	20 including the bonus depreciation deduction;
898	898	21 (2) for taxable years ending on or before
899	899	22 December 31, 2005, "x" equals "y" multiplied by 30
900	900	23 and then divided by 70 (or "y" multiplied by
901	901	24 0.429); and
902	902	25 (3) for taxable years ending after December
903	903	26 31, 2005:
904	904
905	905
906	906
907	907
908	908
909	909	SB1535 - 24 - LRB103 25041 HLH 51375 b
910	910
911	911
912	912	SB1535- 25 -LRB103 25041 HLH 51375 b SB1535 - 25 - LRB103 25041 HLH 51375 b
913	913	SB1535 - 25 - LRB103 25041 HLH 51375 b
914	914	1 (i) for property on which a bonus
915	915	2 depreciation deduction of 30% of the adjusted
916	916	3 basis was taken, "x" equals "y" multiplied by
917	917	4 30 and then divided by 70 (or "y" multiplied
918	918	5 by 0.429); and
919	919	6 (ii) for property on which a bonus
920	920	7 depreciation deduction of 50% of the adjusted
921	921	8 basis was taken, "x" equals "y" multiplied by
922	922	9 1.0;
923	923	10 (iii) (blank); for property on which a
924	924	11 bonus depreciation deduction of 100% of the
925	925	12 adjusted basis was taken in a taxable year
926	926	13 ending on or after December 31, 2021, "x"
927	927	14 equals the depreciation deduction that would
928	928	15 be allowed on that property if the taxpayer
929	929	16 had made the election under Section 168(k)(7)
930	930	17 of the Internal Revenue Code to not claim
931	931	18 bonus depreciation on that property; and
932	932	19 (iv) (blank). for property on which a
933	933	20 bonus depreciation deduction of a percentage
934	934	21 other than 30%, 50% or 100% of the adjusted
935	935	22 basis was taken in a taxable year ending on or
936	936	23 after December 31, 2021, "x" equals "y"
937	937	24 multiplied by 100 times the percentage bonus
938	938	25 depreciation on the property (that is,
939	939	26 100(bonus%)) and then divided by 100 times 1
940	940
941	941
942	942
943	943
944	944
945	945	SB1535 - 25 - LRB103 25041 HLH 51375 b
946	946
947	947
948	948	SB1535- 26 -LRB103 25041 HLH 51375 b SB1535 - 26 - LRB103 25041 HLH 51375 b
949	949	SB1535 - 26 - LRB103 25041 HLH 51375 b
950	950	1 minus the percentage bonus depreciation on the
951	951	2 property (that is, 100(1bonus%)).
952	952	3 The aggregate amount deducted under this
953	953	4 subparagraph in all taxable years for any one piece of
954	954	5 property may not exceed the amount of the bonus
955	955	6 depreciation deduction taken on that property on the
956	956	7 taxpayer's federal income tax return under subsection
957	957	8 (k) of Section 168 of the Internal Revenue Code. This
958	958	9 subparagraph (Z) is exempt from the provisions of
959	959	10 Section 250;
960	960	11 (AA) If the taxpayer sells, transfers, abandons,
961	961	12 or otherwise disposes of property for which the
962	962	13 taxpayer was required in any taxable year to make an
963	963	14 addition modification under subparagraph (D-15), then
964	964	15 an amount equal to that addition modification.
965	965	16 If the taxpayer continues to own property through
966	966	17 the last day of the last tax year for which the
967	967	18 taxpayer may claim a depreciation deduction for
968	968	19 federal income tax purposes a subtraction is allowed
969	969	20 with respect to that property under subparagraph (Z)
970	970	21 and for which the taxpayer was required in any taxable
971	971	22 year to make an addition modification under
972	972	23 subparagraph (D-15), then an amount equal to that
973	973	24 addition modification.
974	974	25 The taxpayer is allowed to take the deduction
975	975	26 under this subparagraph only once with respect to any
976	976
977	977
978	978
979	979
980	980
981	981	SB1535 - 26 - LRB103 25041 HLH 51375 b
982	982
983	983
984	984	SB1535- 27 -LRB103 25041 HLH 51375 b SB1535 - 27 - LRB103 25041 HLH 51375 b
985	985	SB1535 - 27 - LRB103 25041 HLH 51375 b
986	986	1 one piece of property.
987	987	2 This subparagraph (AA) is exempt from the
988	988	3 provisions of Section 250;
989	989	4 (BB) Any amount included in adjusted gross income,
990	990	5 other than salary, received by a driver in a
991	991	6 ridesharing arrangement using a motor vehicle;
992	992	7 (CC) The amount of (i) any interest income (net of
993	993	8 the deductions allocable thereto) taken into account
994	994	9 for the taxable year with respect to a transaction
995	995	10 with a taxpayer that is required to make an addition
996	996	11 modification with respect to such transaction under
997	997	12 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
998	998	13 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
999	999	14 the amount of that addition modification, and (ii) any
1000	1000	15 income from intangible property (net of the deductions
1001	1001	16 allocable thereto) taken into account for the taxable
1002	1002	17 year with respect to a transaction with a taxpayer
1003	1003	18 that is required to make an addition modification with
1004	1004	19 respect to such transaction under Section
1005	1005	20 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
1006	1006	21 203(d)(2)(D-8), but not to exceed the amount of that
1007	1007	22 addition modification. This subparagraph (CC) is
1008	1008	23 exempt from the provisions of Section 250;
1009	1009	24 (DD) An amount equal to the interest income taken
1010	1010	25 into account for the taxable year (net of the
1011	1011	26 deductions allocable thereto) with respect to
1012	1012
1013	1013
1014	1014
1015	1015
1016	1016
1017	1017	SB1535 - 27 - LRB103 25041 HLH 51375 b
1018	1018
1019	1019
1020	1020	SB1535- 28 -LRB103 25041 HLH 51375 b SB1535 - 28 - LRB103 25041 HLH 51375 b
1021	1021	SB1535 - 28 - LRB103 25041 HLH 51375 b
1022	1022	1 transactions with (i) a foreign person who would be a
1023	1023	2 member of the taxpayer's unitary business group but
1024	1024	3 for the fact that the foreign person's business
1025	1025	4 activity outside the United States is 80% or more of
1026	1026	5 that person's total business activity and (ii) for
1027	1027	6 taxable years ending on or after December 31, 2008, to
1028	1028	7 a person who would be a member of the same unitary
1029	1029	8 business group but for the fact that the person is
1030	1030	9 prohibited under Section 1501(a)(27) from being
1031	1031	10 included in the unitary business group because he or
1032	1032	11 she is ordinarily required to apportion business
1033	1033	12 income under different subsections of Section 304, but
1034	1034	13 not to exceed the addition modification required to be
1035	1035	14 made for the same taxable year under Section
1036	1036	15 203(a)(2)(D-17) for interest paid, accrued, or
1037	1037	16 incurred, directly or indirectly, to the same person.
1038	1038	17 This subparagraph (DD) is exempt from the provisions
1039	1039	18 of Section 250;
1040	1040	19 (EE) An amount equal to the income from intangible
1041	1041	20 property taken into account for the taxable year (net
1042	1042	21 of the deductions allocable thereto) with respect to
1043	1043	22 transactions with (i) a foreign person who would be a
1044	1044	23 member of the taxpayer's unitary business group but
1045	1045	24 for the fact that the foreign person's business
1046	1046	25 activity outside the United States is 80% or more of
1047	1047	26 that person's total business activity and (ii) for
1048	1048
1049	1049
1050	1050
1051	1051
1052	1052
1053	1053	SB1535 - 28 - LRB103 25041 HLH 51375 b
1054	1054
1055	1055
1056	1056	SB1535- 29 -LRB103 25041 HLH 51375 b SB1535 - 29 - LRB103 25041 HLH 51375 b
1057	1057	SB1535 - 29 - LRB103 25041 HLH 51375 b
1058	1058	1 taxable years ending on or after December 31, 2008, to
1059	1059	2 a person who would be a member of the same unitary
1060	1060	3 business group but for the fact that the person is
1061	1061	4 prohibited under Section 1501(a)(27) from being
1062	1062	5 included in the unitary business group because he or
1063	1063	6 she is ordinarily required to apportion business
1064	1064	7 income under different subsections of Section 304, but
1065	1065	8 not to exceed the addition modification required to be
1066	1066	9 made for the same taxable year under Section
1067	1067	10 203(a)(2)(D-18) for intangible expenses and costs
1068	1068	11 paid, accrued, or incurred, directly or indirectly, to
1069	1069	12 the same foreign person. This subparagraph (EE) is
1070	1070	13 exempt from the provisions of Section 250;
1071	1071	14 (FF) An amount equal to any amount awarded to the
1072	1072	15 taxpayer during the taxable year by the Court of
1073	1073	16 Claims under subsection (c) of Section 8 of the Court
1074	1074	17 of Claims Act for time unjustly served in a State
1075	1075	18 prison. This subparagraph (FF) is exempt from the
1076	1076	19 provisions of Section 250;
1077	1077	20 (GG) For taxable years ending on or after December
1078	1078	21 31, 2011, in the case of a taxpayer who was required to
1079	1079	22 add back any insurance premiums under Section
1080	1080	23 203(a)(2)(D-19), such taxpayer may elect to subtract
1081	1081	24 that part of a reimbursement received from the
1082	1082	25 insurance company equal to the amount of the expense
1083	1083	26 or loss (including expenses incurred by the insurance
1084	1084
1085	1085
1086	1086
1087	1087
1088	1088
1089	1089	SB1535 - 29 - LRB103 25041 HLH 51375 b
1090	1090
1091	1091
1092	1092	SB1535- 30 -LRB103 25041 HLH 51375 b SB1535 - 30 - LRB103 25041 HLH 51375 b
1093	1093	SB1535 - 30 - LRB103 25041 HLH 51375 b
1094	1094	1 company) that would have been taken into account as a
1095	1095	2 deduction for federal income tax purposes if the
1096	1096	3 expense or loss had been uninsured. If a taxpayer
1097	1097	4 makes the election provided for by this subparagraph
1098	1098	5 (GG), the insurer to which the premiums were paid must
1099	1099	6 add back to income the amount subtracted by the
1100	1100	7 taxpayer pursuant to this subparagraph (GG). This
1101	1101	8 subparagraph (GG) is exempt from the provisions of
1102	1102	9 Section 250;
1103	1103	10 (HH) For taxable years beginning on or after
1104	1104	11 January 1, 2018 and prior to January 1, 2028, a maximum
1105	1105	12 of $10,000 contributed in the taxable year to a
1106	1106	13 qualified ABLE account under Section 16.6 of the State
1107	1107	14 Treasurer Act, except that amounts excluded from gross
1108	1108	15 income under Section 529(c)(3)(C)(i) or Section
1109	1109	16 529A(c)(1)(C) of the Internal Revenue Code shall not
1110	1110	17 be considered moneys contributed under this
1111	1111	18 subparagraph (HH). For purposes of this subparagraph
1112	1112	19 (HH), contributions made by an employer on behalf of
1113	1113	20 an employee, or matching contributions made by an
1114	1114	21 employee, shall be treated as made by the employee;
1115	1115	22 and
1116	1116	23 (II) For taxable years that begin on or after
1117	1117	24 January 1, 2021 and begin before January 1, 2026, the
1118	1118	25 amount that is included in the taxpayer's federal
1119	1119	26 adjusted gross income pursuant to Section 61 of the
1120	1120
1121	1121
1122	1122
1123	1123
1124	1124
1125	1125	SB1535 - 30 - LRB103 25041 HLH 51375 b
1126	1126
1127	1127
1128	1128	SB1535- 31 -LRB103 25041 HLH 51375 b SB1535 - 31 - LRB103 25041 HLH 51375 b
1129	1129	SB1535 - 31 - LRB103 25041 HLH 51375 b
1130	1130	1 Internal Revenue Code as discharge of indebtedness
1131	1131	2 attributable to student loan forgiveness and that is
1132	1132	3 not excluded from the taxpayer's federal adjusted
1133	1133	4 gross income pursuant to paragraph (5) of subsection
1134	1134	5 (f) of Section 108 of the Internal Revenue Code.
1135	1135	6 (b) Corporations.
1136	1136	7 (1) In general. In the case of a corporation, base
1137	1137	8 income means an amount equal to the taxpayer's taxable
1138	1138	9 income for the taxable year as modified by paragraph (2).
1139	1139	10 (2) Modifications. The taxable income referred to in
1140	1140	11 paragraph (1) shall be modified by adding thereto the sum
1141	1141	12 of the following amounts:
1142	1142	13 (A) An amount equal to all amounts paid or accrued
1143	1143	14 to the taxpayer as interest and all distributions
1144	1144	15 received from regulated investment companies during
1145	1145	16 the taxable year to the extent excluded from gross
1146	1146	17 income in the computation of taxable income;
1147	1147	18 (B) An amount equal to the amount of tax imposed by
1148	1148	19 this Act to the extent deducted from gross income in
1149	1149	20 the computation of taxable income for the taxable
1150	1150	21 year;
1151	1151	22 (C) In the case of a regulated investment company,
1152	1152	23 an amount equal to the excess of (i) the net long-term
1153	1153	24 capital gain for the taxable year, over (ii) the
1154	1154	25 amount of the capital gain dividends designated as
1155	1155
1156	1156
1157	1157
1158	1158
1159	1159
1160	1160	SB1535 - 31 - LRB103 25041 HLH 51375 b
1161	1161
1162	1162
1163	1163	SB1535- 32 -LRB103 25041 HLH 51375 b SB1535 - 32 - LRB103 25041 HLH 51375 b
1164	1164	SB1535 - 32 - LRB103 25041 HLH 51375 b
1165	1165	1 such in accordance with Section 852(b)(3)(C) of the
1166	1166	2 Internal Revenue Code and any amount designated under
1167	1167	3 Section 852(b)(3)(D) of the Internal Revenue Code,
1168	1168	4 attributable to the taxable year (this amendatory Act
1169	1169	5 of 1995 (Public Act 89-89) is declarative of existing
1170	1170	6 law and is not a new enactment);
1171	1171	7 (D) The amount of any net operating loss deduction
1172	1172	8 taken in arriving at taxable income, other than a net
1173	1173	9 operating loss carried forward from a taxable year
1174	1174	10 ending prior to December 31, 1986;
1175	1175	11 (E) For taxable years in which a net operating
1176	1176	12 loss carryback or carryforward from a taxable year
1177	1177	13 ending prior to December 31, 1986 is an element of
1178	1178	14 taxable income under paragraph (1) of subsection (e)
1179	1179	15 or subparagraph (E) of paragraph (2) of subsection
1180	1180	16 (e), the amount by which addition modifications other
1181	1181	17 than those provided by this subparagraph (E) exceeded
1182	1182	18 subtraction modifications in such earlier taxable
1183	1183	19 year, with the following limitations applied in the
1184	1184	20 order that they are listed:
1185	1185	21 (i) the addition modification relating to the
1186	1186	22 net operating loss carried back or forward to the
1187	1187	23 taxable year from any taxable year ending prior to
1188	1188	24 December 31, 1986 shall be reduced by the amount
1189	1189	25 of addition modification under this subparagraph
1190	1190	26 (E) which related to that net operating loss and
1191	1191
1192	1192
1193	1193
1194	1194
1195	1195
1196	1196	SB1535 - 32 - LRB103 25041 HLH 51375 b
1197	1197
1198	1198
1199	1199	SB1535- 33 -LRB103 25041 HLH 51375 b SB1535 - 33 - LRB103 25041 HLH 51375 b
1200	1200	SB1535 - 33 - LRB103 25041 HLH 51375 b
1201	1201	1 which was taken into account in calculating the
1202	1202	2 base income of an earlier taxable year, and
1203	1203	3 (ii) the addition modification relating to the
1204	1204	4 net operating loss carried back or forward to the
1205	1205	5 taxable year from any taxable year ending prior to
1206	1206	6 December 31, 1986 shall not exceed the amount of
1207	1207	7 such carryback or carryforward;
1208	1208	8 For taxable years in which there is a net
1209	1209	9 operating loss carryback or carryforward from more
1210	1210	10 than one other taxable year ending prior to December
1211	1211	11 31, 1986, the addition modification provided in this
1212	1212	12 subparagraph (E) shall be the sum of the amounts
1213	1213	13 computed independently under the preceding provisions
1214	1214	14 of this subparagraph (E) for each such taxable year;
1215	1215	15 (E-5) For taxable years ending after December 31,
1216	1216	16 1997, an amount equal to any eligible remediation
1217	1217	17 costs that the corporation deducted in computing
1218	1218	18 adjusted gross income and for which the corporation
1219	1219	19 claims a credit under subsection (l) of Section 201;
1220	1220	20 (E-10) For taxable years 2001 and thereafter, an
1221	1221	21 amount equal to the bonus depreciation deduction taken
1222	1222	22 on the taxpayer's federal income tax return for the
1223	1223	23 taxable year under subsection (k) of Section 168 of
1224	1224	24 the Internal Revenue Code;
1225	1225	25 (E-11) If the taxpayer sells, transfers, abandons,
1226	1226	26 or otherwise disposes of property for which the
1227	1227
1228	1228
1229	1229
1230	1230
1231	1231
1232	1232	SB1535 - 33 - LRB103 25041 HLH 51375 b
1233	1233
1234	1234
1235	1235	SB1535- 34 -LRB103 25041 HLH 51375 b SB1535 - 34 - LRB103 25041 HLH 51375 b
1236	1236	SB1535 - 34 - LRB103 25041 HLH 51375 b
1237	1237	1 taxpayer was required in any taxable year to make an
1238	1238	2 addition modification under subparagraph (E-10), then
1239	1239	3 an amount equal to the aggregate amount of the
1240	1240	4 deductions taken in all taxable years under
1241	1241	5 subparagraph (T) with respect to that property.
1242	1242	6 If the taxpayer continues to own property through
1243	1243	7 the last day of the last tax year for which the
1244	1244	8 taxpayer may claim a depreciation deduction for
1245	1245	9 federal income tax purposes a subtraction is allowed
1246	1246	10 with respect to that property under subparagraph (T)
1247	1247	11 and for which the taxpayer was allowed in any taxable
1248	1248	12 year to make a subtraction modification under
1249	1249	13 subparagraph (T), then an amount equal to that
1250	1250	14 subtraction modification.
1251	1251	15 The taxpayer is required to make the addition
1252	1252	16 modification under this subparagraph only once with
1253	1253	17 respect to any one piece of property;
1254	1254	18 (E-12) An amount equal to the amount otherwise
1255	1255	19 allowed as a deduction in computing base income for
1256	1256	20 interest paid, accrued, or incurred, directly or
1257	1257	21 indirectly, (i) for taxable years ending on or after
1258	1258	22 December 31, 2004, to a foreign person who would be a
1259	1259	23 member of the same unitary business group but for the
1260	1260	24 fact the foreign person's business activity outside
1261	1261	25 the United States is 80% or more of the foreign
1262	1262	26 person's total business activity and (ii) for taxable
1263	1263
1264	1264
1265	1265
1266	1266
1267	1267
1268	1268	SB1535 - 34 - LRB103 25041 HLH 51375 b
1269	1269
1270	1270
1271	1271	SB1535- 35 -LRB103 25041 HLH 51375 b SB1535 - 35 - LRB103 25041 HLH 51375 b
1272	1272	SB1535 - 35 - LRB103 25041 HLH 51375 b
1273	1273	1 years ending on or after December 31, 2008, to a person
1274	1274	2 who would be a member of the same unitary business
1275	1275	3 group but for the fact that the person is prohibited
1276	1276	4 under Section 1501(a)(27) from being included in the
1277	1277	5 unitary business group because he or she is ordinarily
1278	1278	6 required to apportion business income under different
1279	1279	7 subsections of Section 304. The addition modification
1280	1280	8 required by this subparagraph shall be reduced to the
1281	1281	9 extent that dividends were included in base income of
1282	1282	10 the unitary group for the same taxable year and
1283	1283	11 received by the taxpayer or by a member of the
1284	1284	12 taxpayer's unitary business group (including amounts
1285	1285	13 included in gross income pursuant to Sections 951
1286	1286	14 through 964 of the Internal Revenue Code and amounts
1287	1287	15 included in gross income under Section 78 of the
1288	1288	16 Internal Revenue Code) with respect to the stock of
1289	1289	17 the same person to whom the interest was paid,
1290	1290	18 accrued, or incurred.
1291	1291	19 This paragraph shall not apply to the following:
1292	1292	20 (i) an item of interest paid, accrued, or
1293	1293	21 incurred, directly or indirectly, to a person who
1294	1294	22 is subject in a foreign country or state, other
1295	1295	23 than a state which requires mandatory unitary
1296	1296	24 reporting, to a tax on or measured by net income
1297	1297	25 with respect to such interest; or
1298	1298	26 (ii) an item of interest paid, accrued, or
1299	1299
1300	1300
1301	1301
1302	1302
1303	1303
1304	1304	SB1535 - 35 - LRB103 25041 HLH 51375 b
1305	1305
1306	1306
1307	1307	SB1535- 36 -LRB103 25041 HLH 51375 b SB1535 - 36 - LRB103 25041 HLH 51375 b
1308	1308	SB1535 - 36 - LRB103 25041 HLH 51375 b
1309	1309	1 incurred, directly or indirectly, to a person if
1310	1310	2 the taxpayer can establish, based on a
1311	1311	3 preponderance of the evidence, both of the
1312	1312	4 following:
1313	1313	5 (a) the person, during the same taxable
1314	1314	6 year, paid, accrued, or incurred, the interest
1315	1315	7 to a person that is not a related member, and
1316	1316	8 (b) the transaction giving rise to the
1317	1317	9 interest expense between the taxpayer and the
1318	1318	10 person did not have as a principal purpose the
1319	1319	11 avoidance of Illinois income tax, and is paid
1320	1320	12 pursuant to a contract or agreement that
1321	1321	13 reflects an arm's-length interest rate and
1322	1322	14 terms; or
1323	1323	15 (iii) the taxpayer can establish, based on
1324	1324	16 clear and convincing evidence, that the interest
1325	1325	17 paid, accrued, or incurred relates to a contract
1326	1326	18 or agreement entered into at arm's-length rates
1327	1327	19 and terms and the principal purpose for the
1328	1328	20 payment is not federal or Illinois tax avoidance;
1329	1329	21 or
1330	1330	22 (iv) an item of interest paid, accrued, or
1331	1331	23 incurred, directly or indirectly, to a person if
1332	1332	24 the taxpayer establishes by clear and convincing
1333	1333	25 evidence that the adjustments are unreasonable; or
1334	1334	26 if the taxpayer and the Director agree in writing
1335	1335
1336	1336
1337	1337
1338	1338
1339	1339
1340	1340	SB1535 - 36 - LRB103 25041 HLH 51375 b
1341	1341
1342	1342
1343	1343	SB1535- 37 -LRB103 25041 HLH 51375 b SB1535 - 37 - LRB103 25041 HLH 51375 b
1344	1344	SB1535 - 37 - LRB103 25041 HLH 51375 b
1345	1345	1 to the application or use of an alternative method
1346	1346	2 of apportionment under Section 304(f).
1347	1347	3 Nothing in this subsection shall preclude the
1348	1348	4 Director from making any other adjustment
1349	1349	5 otherwise allowed under Section 404 of this Act
1350	1350	6 for any tax year beginning after the effective
1351	1351	7 date of this amendment provided such adjustment is
1352	1352	8 made pursuant to regulation adopted by the
1353	1353	9 Department and such regulations provide methods
1354	1354	10 and standards by which the Department will utilize
1355	1355	11 its authority under Section 404 of this Act;
1356	1356	12 (E-13) An amount equal to the amount of intangible
1357	1357	13 expenses and costs otherwise allowed as a deduction in
1358	1358	14 computing base income, and that were paid, accrued, or
1359	1359	15 incurred, directly or indirectly, (i) for taxable
1360	1360	16 years ending on or after December 31, 2004, to a
1361	1361	17 foreign person who would be a member of the same
1362	1362	18 unitary business group but for the fact that the
1363	1363	19 foreign person's business activity outside the United
1364	1364	20 States is 80% or more of that person's total business
1365	1365	21 activity and (ii) for taxable years ending on or after
1366	1366	22 December 31, 2008, to a person who would be a member of
1367	1367	23 the same unitary business group but for the fact that
1368	1368	24 the person is prohibited under Section 1501(a)(27)
1369	1369	25 from being included in the unitary business group
1370	1370	26 because he or she is ordinarily required to apportion
1371	1371
1372	1372
1373	1373
1374	1374
1375	1375
1376	1376	SB1535 - 37 - LRB103 25041 HLH 51375 b
1377	1377
1378	1378
1379	1379	SB1535- 38 -LRB103 25041 HLH 51375 b SB1535 - 38 - LRB103 25041 HLH 51375 b
1380	1380	SB1535 - 38 - LRB103 25041 HLH 51375 b
1381	1381	1 business income under different subsections of Section
1382	1382	2 304. The addition modification required by this
1383	1383	3 subparagraph shall be reduced to the extent that
1384	1384	4 dividends were included in base income of the unitary
1385	1385	5 group for the same taxable year and received by the
1386	1386	6 taxpayer or by a member of the taxpayer's unitary
1387	1387	7 business group (including amounts included in gross
1388	1388	8 income pursuant to Sections 951 through 964 of the
1389	1389	9 Internal Revenue Code and amounts included in gross
1390	1390	10 income under Section 78 of the Internal Revenue Code)
1391	1391	11 with respect to the stock of the same person to whom
1392	1392	12 the intangible expenses and costs were directly or
1393	1393	13 indirectly paid, incurred, or accrued. The preceding
1394	1394	14 sentence shall not apply to the extent that the same
1395	1395	15 dividends caused a reduction to the addition
1396	1396	16 modification required under Section 203(b)(2)(E-12) of
1397	1397	17 this Act. As used in this subparagraph, the term
1398	1398	18 "intangible expenses and costs" includes (1) expenses,
1399	1399	19 losses, and costs for, or related to, the direct or
1400	1400	20 indirect acquisition, use, maintenance or management,
1401	1401	21 ownership, sale, exchange, or any other disposition of
1402	1402	22 intangible property; (2) losses incurred, directly or
1403	1403	23 indirectly, from factoring transactions or discounting
1404	1404	24 transactions; (3) royalty, patent, technical, and
1405	1405	25 copyright fees; (4) licensing fees; and (5) other
1406	1406	26 similar expenses and costs. For purposes of this
1407	1407
1408	1408
1409	1409
1410	1410
1411	1411
1412	1412	SB1535 - 38 - LRB103 25041 HLH 51375 b
1413	1413
1414	1414
1415	1415	SB1535- 39 -LRB103 25041 HLH 51375 b SB1535 - 39 - LRB103 25041 HLH 51375 b
1416	1416	SB1535 - 39 - LRB103 25041 HLH 51375 b
1417	1417	1 subparagraph, "intangible property" includes patents,
1418	1418	2 patent applications, trade names, trademarks, service
1419	1419	3 marks, copyrights, mask works, trade secrets, and
1420	1420	4 similar types of intangible assets.
1421	1421	5 This paragraph shall not apply to the following:
1422	1422	6 (i) any item of intangible expenses or costs
1423	1423	7 paid, accrued, or incurred, directly or
1424	1424	8 indirectly, from a transaction with a person who
1425	1425	9 is subject in a foreign country or state, other
1426	1426	10 than a state which requires mandatory unitary
1427	1427	11 reporting, to a tax on or measured by net income
1428	1428	12 with respect to such item; or
1429	1429	13 (ii) any item of intangible expense or cost
1430	1430	14 paid, accrued, or incurred, directly or
1431	1431	15 indirectly, if the taxpayer can establish, based
1432	1432	16 on a preponderance of the evidence, both of the
1433	1433	17 following:
1434	1434	18 (a) the person during the same taxable
1435	1435	19 year paid, accrued, or incurred, the
1436	1436	20 intangible expense or cost to a person that is
1437	1437	21 not a related member, and
1438	1438	22 (b) the transaction giving rise to the
1439	1439	23 intangible expense or cost between the
1440	1440	24 taxpayer and the person did not have as a
1441	1441	25 principal purpose the avoidance of Illinois
1442	1442	26 income tax, and is paid pursuant to a contract
1443	1443
1444	1444
1445	1445
1446	1446
1447	1447
1448	1448	SB1535 - 39 - LRB103 25041 HLH 51375 b
1449	1449
1450	1450
1451	1451	SB1535- 40 -LRB103 25041 HLH 51375 b SB1535 - 40 - LRB103 25041 HLH 51375 b
1452	1452	SB1535 - 40 - LRB103 25041 HLH 51375 b
1453	1453	1 or agreement that reflects arm's-length terms;
1454	1454	2 or
1455	1455	3 (iii) any item of intangible expense or cost
1456	1456	4 paid, accrued, or incurred, directly or
1457	1457	5 indirectly, from a transaction with a person if
1458	1458	6 the taxpayer establishes by clear and convincing
1459	1459	7 evidence, that the adjustments are unreasonable;
1460	1460	8 or if the taxpayer and the Director agree in
1461	1461	9 writing to the application or use of an
1462	1462	10 alternative method of apportionment under Section
1463	1463	11 304(f);
1464	1464	12 Nothing in this subsection shall preclude the
1465	1465	13 Director from making any other adjustment
1466	1466	14 otherwise allowed under Section 404 of this Act
1467	1467	15 for any tax year beginning after the effective
1468	1468	16 date of this amendment provided such adjustment is
1469	1469	17 made pursuant to regulation adopted by the
1470	1470	18 Department and such regulations provide methods
1471	1471	19 and standards by which the Department will utilize
1472	1472	20 its authority under Section 404 of this Act;
1473	1473	21 (E-14) For taxable years ending on or after
1474	1474	22 December 31, 2008, an amount equal to the amount of
1475	1475	23 insurance premium expenses and costs otherwise allowed
1476	1476	24 as a deduction in computing base income, and that were
1477	1477	25 paid, accrued, or incurred, directly or indirectly, to
1478	1478	26 a person who would be a member of the same unitary
1479	1479
1480	1480
1481	1481
1482	1482
1483	1483
1484	1484	SB1535 - 40 - LRB103 25041 HLH 51375 b
1485	1485
1486	1486
1487	1487	SB1535- 41 -LRB103 25041 HLH 51375 b SB1535 - 41 - LRB103 25041 HLH 51375 b
1488	1488	SB1535 - 41 - LRB103 25041 HLH 51375 b
1489	1489	1 business group but for the fact that the person is
1490	1490	2 prohibited under Section 1501(a)(27) from being
1491	1491	3 included in the unitary business group because he or
1492	1492	4 she is ordinarily required to apportion business
1493	1493	5 income under different subsections of Section 304. The
1494	1494	6 addition modification required by this subparagraph
1495	1495	7 shall be reduced to the extent that dividends were
1496	1496	8 included in base income of the unitary group for the
1497	1497	9 same taxable year and received by the taxpayer or by a
1498	1498	10 member of the taxpayer's unitary business group
1499	1499	11 (including amounts included in gross income under
1500	1500	12 Sections 951 through 964 of the Internal Revenue Code
1501	1501	13 and amounts included in gross income under Section 78
1502	1502	14 of the Internal Revenue Code) with respect to the
1503	1503	15 stock of the same person to whom the premiums and costs
1504	1504	16 were directly or indirectly paid, incurred, or
1505	1505	17 accrued. The preceding sentence does not apply to the
1506	1506	18 extent that the same dividends caused a reduction to
1507	1507	19 the addition modification required under Section
1508	1508	20 203(b)(2)(E-12) or Section 203(b)(2)(E-13) of this
1509	1509	21 Act;
1510	1510	22 (E-15) For taxable years beginning after December
1511	1511	23 31, 2008, any deduction for dividends paid by a
1512	1512	24 captive real estate investment trust that is allowed
1513	1513	25 to a real estate investment trust under Section
1514	1514	26 857(b)(2)(B) of the Internal Revenue Code for
1515	1515
1516	1516
1517	1517
1518	1518
1519	1519
1520	1520	SB1535 - 41 - LRB103 25041 HLH 51375 b
1521	1521
1522	1522
1523	1523	SB1535- 42 -LRB103 25041 HLH 51375 b SB1535 - 42 - LRB103 25041 HLH 51375 b
1524	1524	SB1535 - 42 - LRB103 25041 HLH 51375 b
1525	1525	1 dividends paid;
1526	1526	2 (E-16) An amount equal to the credit allowable to
1527	1527	3 the taxpayer under Section 218(a) of this Act,
1528	1528	4 determined without regard to Section 218(c) of this
1529	1529	5 Act;
1530	1530	6 (E-17) For taxable years ending on or after
1531	1531	7 December 31, 2017, an amount equal to the deduction
1532	1532	8 allowed under Section 199 of the Internal Revenue Code
1533	1533	9 for the taxable year;
1534	1534	10 (E-18) for taxable years beginning after December
1535	1535	11 31, 2018, an amount equal to the deduction allowed
1536	1536	12 under Section 250(a)(1)(A) of the Internal Revenue
1537	1537	13 Code for the taxable year;
1538	1538	14 (E-19) for taxable years ending on or after June
1539	1539	15 30, 2021, an amount equal to the deduction allowed
1540	1540	16 under Section 250(a)(1)(B)(i) of the Internal Revenue
1541	1541	17 Code for the taxable year;
1542	1542	18 (E-20) for taxable years ending on or after June
1543	1543	19 30, 2021, an amount equal to the deduction allowed
1544	1544	20 under Sections 243(e) and 245A(a) of the Internal
1545	1545	21 Revenue Code for the taxable year.
1546	1546	22 and by deducting from the total so obtained the sum of the
1547	1547	23 following amounts:
1548	1548	24 (F) An amount equal to the amount of any tax
1549	1549	25 imposed by this Act which was refunded to the taxpayer
1550	1550	26 and included in such total for the taxable year;
1551	1551
1552	1552
1553	1553
1554	1554
1555	1555
1556	1556	SB1535 - 42 - LRB103 25041 HLH 51375 b
1557	1557
1558	1558
1559	1559	SB1535- 43 -LRB103 25041 HLH 51375 b SB1535 - 43 - LRB103 25041 HLH 51375 b
1560	1560	SB1535 - 43 - LRB103 25041 HLH 51375 b
1561	1561	1 (G) An amount equal to any amount included in such
1562	1562	2 total under Section 78 of the Internal Revenue Code;
1563	1563	3 (H) In the case of a regulated investment company,
1564	1564	4 an amount equal to the amount of exempt interest
1565	1565	5 dividends as defined in subsection (b)(5) of Section
1566	1566	6 852 of the Internal Revenue Code, paid to shareholders
1567	1567	7 for the taxable year;
1568	1568	8 (I) With the exception of any amounts subtracted
1569	1569	9 under subparagraph (J), an amount equal to the sum of
1570	1570	10 all amounts disallowed as deductions by (i) Sections
1571	1571	11 171(a)(2) and 265(a)(2) and amounts disallowed as
1572	1572	12 interest expense by Section 291(a)(3) of the Internal
1573	1573	13 Revenue Code, and all amounts of expenses allocable to
1574	1574	14 interest and disallowed as deductions by Section
1575	1575	15 265(a)(1) of the Internal Revenue Code; and (ii) for
1576	1576	16 taxable years ending on or after August 13, 1999,
1577	1577	17 Sections 171(a)(2), 265, 280C, 291(a)(3), and
1578	1578	18 832(b)(5)(B)(i) of the Internal Revenue Code, plus,
1579	1579	19 for tax years ending on or after December 31, 2011,
1580	1580	20 amounts disallowed as deductions by Section 45G(e)(3)
1581	1581	21 of the Internal Revenue Code and, for taxable years
1582	1582	22 ending on or after December 31, 2008, any amount
1583	1583	23 included in gross income under Section 87 of the
1584	1584	24 Internal Revenue Code and the policyholders' share of
1585	1585	25 tax-exempt interest of a life insurance company under
1586	1586	26 Section 807(a)(2)(B) of the Internal Revenue Code (in
1587	1587
1588	1588
1589	1589
1590	1590
1591	1591
1592	1592	SB1535 - 43 - LRB103 25041 HLH 51375 b
1593	1593
1594	1594
1595	1595	SB1535- 44 -LRB103 25041 HLH 51375 b SB1535 - 44 - LRB103 25041 HLH 51375 b
1596	1596	SB1535 - 44 - LRB103 25041 HLH 51375 b
1597	1597	1 the case of a life insurance company with gross income
1598	1598	2 from a decrease in reserves for the tax year) or
1599	1599	3 Section 807(b)(1)(B) of the Internal Revenue Code (in
1600	1600	4 the case of a life insurance company allowed a
1601	1601	5 deduction for an increase in reserves for the tax
1602	1602	6 year); the provisions of this subparagraph are exempt
1603	1603	7 from the provisions of Section 250;
1604	1604	8 (J) An amount equal to all amounts included in
1605	1605	9 such total which are exempt from taxation by this
1606	1606	10 State either by reason of its statutes or Constitution
1607	1607	11 or by reason of the Constitution, treaties or statutes
1608	1608	12 of the United States; provided that, in the case of any
1609	1609	13 statute of this State that exempts income derived from
1610	1610	14 bonds or other obligations from the tax imposed under
1611	1611	15 this Act, the amount exempted shall be the interest
1612	1612	16 net of bond premium amortization;
1613	1613	17 (K) An amount equal to those dividends included in
1614	1614	18 such total which were paid by a corporation which
1615	1615	19 conducts business operations in a River Edge
1616	1616	20 Redevelopment Zone or zones created under the River
1617	1617	21 Edge Redevelopment Zone Act and conducts substantially
1618	1618	22 all of its operations in a River Edge Redevelopment
1619	1619	23 Zone or zones. This subparagraph (K) is exempt from
1620	1620	24 the provisions of Section 250;
1621	1621	25 (L) An amount equal to those dividends included in
1622	1622	26 such total that were paid by a corporation that
1623	1623
1624	1624
1625	1625
1626	1626
1627	1627
1628	1628	SB1535 - 44 - LRB103 25041 HLH 51375 b
1629	1629
1630	1630
1631	1631	SB1535- 45 -LRB103 25041 HLH 51375 b SB1535 - 45 - LRB103 25041 HLH 51375 b
1632	1632	SB1535 - 45 - LRB103 25041 HLH 51375 b
1633	1633	1 conducts business operations in a federally designated
1634	1634	2 Foreign Trade Zone or Sub-Zone and that is designated
1635	1635	3 a High Impact Business located in Illinois; provided
1636	1636	4 that dividends eligible for the deduction provided in
1637	1637	5 subparagraph (K) of paragraph 2 of this subsection
1638	1638	6 shall not be eligible for the deduction provided under
1639	1639	7 this subparagraph (L);
1640	1640	8 (M) For any taxpayer that is a financial
1641	1641	9 organization within the meaning of Section 304(c) of
1642	1642	10 this Act, an amount included in such total as interest
1643	1643	11 income from a loan or loans made by such taxpayer to a
1644	1644	12 borrower, to the extent that such a loan is secured by
1645	1645	13 property which is eligible for the River Edge
1646	1646	14 Redevelopment Zone Investment Credit. To determine the
1647	1647	15 portion of a loan or loans that is secured by property
1648	1648	16 eligible for a Section 201(f) investment credit to the
1649	1649	17 borrower, the entire principal amount of the loan or
1650	1650	18 loans between the taxpayer and the borrower should be
1651	1651	19 divided into the basis of the Section 201(f)
1652	1652	20 investment credit property which secures the loan or
1653	1653	21 loans, using for this purpose the original basis of
1654	1654	22 such property on the date that it was placed in service
1655	1655	23 in the River Edge Redevelopment Zone. The subtraction
1656	1656	24 modification available to the taxpayer in any year
1657	1657	25 under this subsection shall be that portion of the
1658	1658	26 total interest paid by the borrower with respect to
1659	1659
1660	1660
1661	1661
1662	1662
1663	1663
1664	1664	SB1535 - 45 - LRB103 25041 HLH 51375 b
1665	1665
1666	1666
1667	1667	SB1535- 46 -LRB103 25041 HLH 51375 b SB1535 - 46 - LRB103 25041 HLH 51375 b
1668	1668	SB1535 - 46 - LRB103 25041 HLH 51375 b
1669	1669	1 such loan attributable to the eligible property as
1670	1670	2 calculated under the previous sentence. This
1671	1671	3 subparagraph (M) is exempt from the provisions of
1672	1672	4 Section 250;
1673	1673	5 (M-1) For any taxpayer that is a financial
1674	1674	6 organization within the meaning of Section 304(c) of
1675	1675	7 this Act, an amount included in such total as interest
1676	1676	8 income from a loan or loans made by such taxpayer to a
1677	1677	9 borrower, to the extent that such a loan is secured by
1678	1678	10 property which is eligible for the High Impact
1679	1679	11 Business Investment Credit. To determine the portion
1680	1680	12 of a loan or loans that is secured by property eligible
1681	1681	13 for a Section 201(h) investment credit to the
1682	1682	14 borrower, the entire principal amount of the loan or
1683	1683	15 loans between the taxpayer and the borrower should be
1684	1684	16 divided into the basis of the Section 201(h)
1685	1685	17 investment credit property which secures the loan or
1686	1686	18 loans, using for this purpose the original basis of
1687	1687	19 such property on the date that it was placed in service
1688	1688	20 in a federally designated Foreign Trade Zone or
1689	1689	21 Sub-Zone located in Illinois. No taxpayer that is
1690	1690	22 eligible for the deduction provided in subparagraph
1691	1691	23 (M) of paragraph (2) of this subsection shall be
1692	1692	24 eligible for the deduction provided under this
1693	1693	25 subparagraph (M-1). The subtraction modification
1694	1694	26 available to taxpayers in any year under this
1695	1695
1696	1696
1697	1697
1698	1698
1699	1699
1700	1700	SB1535 - 46 - LRB103 25041 HLH 51375 b
1701	1701
1702	1702
1703	1703	SB1535- 47 -LRB103 25041 HLH 51375 b SB1535 - 47 - LRB103 25041 HLH 51375 b
1704	1704	SB1535 - 47 - LRB103 25041 HLH 51375 b
1705	1705	1 subsection shall be that portion of the total interest
1706	1706	2 paid by the borrower with respect to such loan
1707	1707	3 attributable to the eligible property as calculated
1708	1708	4 under the previous sentence;
1709	1709	5 (N) Two times any contribution made during the
1710	1710	6 taxable year to a designated zone organization to the
1711	1711	7 extent that the contribution (i) qualifies as a
1712	1712	8 charitable contribution under subsection (c) of
1713	1713	9 Section 170 of the Internal Revenue Code and (ii)
1714	1714	10 must, by its terms, be used for a project approved by
1715	1715	11 the Department of Commerce and Economic Opportunity
1716	1716	12 under Section 11 of the Illinois Enterprise Zone Act
1717	1717	13 or under Section 10-10 of the River Edge Redevelopment
1718	1718	14 Zone Act. This subparagraph (N) is exempt from the
1719	1719	15 provisions of Section 250;
1720	1720	16 (O) An amount equal to: (i) 85% for taxable years
1721	1721	17 ending on or before December 31, 1992, or, a
1722	1722	18 percentage equal to the percentage allowable under
1723	1723	19 Section 243(a)(1) of the Internal Revenue Code of 1986
1724	1724	20 for taxable years ending after December 31, 1992, of
1725	1725	21 the amount by which dividends included in taxable
1726	1726	22 income and received from a corporation that is not
1727	1727	23 created or organized under the laws of the United
1728	1728	24 States or any state or political subdivision thereof,
1729	1729	25 including, for taxable years ending on or after
1730	1730	26 December 31, 1988, dividends received or deemed
1731	1731
1732	1732
1733	1733
1734	1734
1735	1735
1736	1736	SB1535 - 47 - LRB103 25041 HLH 51375 b
1737	1737
1738	1738
1739	1739	SB1535- 48 -LRB103 25041 HLH 51375 b SB1535 - 48 - LRB103 25041 HLH 51375 b
1740	1740	SB1535 - 48 - LRB103 25041 HLH 51375 b
1741	1741	1 received or paid or deemed paid under Sections 951
1742	1742	2 through 965 of the Internal Revenue Code, exceed the
1743	1743	3 amount of the modification provided under subparagraph
1744	1744	4 (G) of paragraph (2) of this subsection (b) which is
1745	1745	5 related to such dividends, and including, for taxable
1746	1746	6 years ending on or after December 31, 2008, dividends
1747	1747	7 received from a captive real estate investment trust;
1748	1748	8 plus (ii) 100% of the amount by which dividends,
1749	1749	9 included in taxable income and received, including,
1750	1750	10 for taxable years ending on or after December 31,
1751	1751	11 1988, dividends received or deemed received or paid or
1752	1752	12 deemed paid under Sections 951 through 964 of the
1753	1753	13 Internal Revenue Code and including, for taxable years
1754	1754	14 ending on or after December 31, 2008, dividends
1755	1755	15 received from a captive real estate investment trust,
1756	1756	16 from any such corporation specified in clause (i) that
1757	1757	17 would but for the provisions of Section 1504(b)(3) of
1758	1758	18 the Internal Revenue Code be treated as a member of the
1759	1759	19 affiliated group which includes the dividend
1760	1760	20 recipient, exceed the amount of the modification
1761	1761	21 provided under subparagraph (G) of paragraph (2) of
1762	1762	22 this subsection (b) which is related to such
1763	1763	23 dividends. For taxable years ending on or after June
1764	1764	24 30, 2021, (i) for purposes of this subparagraph, the
1765	1765	25 term "dividend" does not include any amount treated as
1766	1766	26 a dividend under Section 1248 of the Internal Revenue
1767	1767
1768	1768
1769	1769
1770	1770
1771	1771
1772	1772	SB1535 - 48 - LRB103 25041 HLH 51375 b
1773	1773
1774	1774
1775	1775	SB1535- 49 -LRB103 25041 HLH 51375 b SB1535 - 49 - LRB103 25041 HLH 51375 b
1776	1776	SB1535 - 49 - LRB103 25041 HLH 51375 b
1777	1777	1 Code, and (ii) this subparagraph shall not apply to
1778	1778	2 dividends for which a deduction is allowed under
1779	1779	3 Section 245(a) of the Internal Revenue Code. This
1780	1780	4 subparagraph (O) is exempt from the provisions of
1781	1781	5 Section 250 of this Act;
1782	1782	6 (P) An amount equal to any contribution made to a
1783	1783	7 job training project established pursuant to the Tax
1784	1784	8 Increment Allocation Redevelopment Act;
1785	1785	9 (Q) An amount equal to the amount of the deduction
1786	1786	10 used to compute the federal income tax credit for
1787	1787	11 restoration of substantial amounts held under claim of
1788	1788	12 right for the taxable year pursuant to Section 1341 of
1789	1789	13 the Internal Revenue Code;
1790	1790	14 (R) On and after July 20, 1999, in the case of an
1791	1791	15 attorney-in-fact with respect to whom an interinsurer
1792	1792	16 or a reciprocal insurer has made the election under
1793	1793	17 Section 835 of the Internal Revenue Code, 26 U.S.C.
1794	1794	18 835, an amount equal to the excess, if any, of the
1795	1795	19 amounts paid or incurred by that interinsurer or
1796	1796	20 reciprocal insurer in the taxable year to the
1797	1797	21 attorney-in-fact over the deduction allowed to that
1798	1798	22 interinsurer or reciprocal insurer with respect to the
1799	1799	23 attorney-in-fact under Section 835(b) of the Internal
1800	1800	24 Revenue Code for the taxable year; the provisions of
1801	1801	25 this subparagraph are exempt from the provisions of
1802	1802	26 Section 250;
1803	1803
1804	1804
1805	1805
1806	1806
1807	1807
1808	1808	SB1535 - 49 - LRB103 25041 HLH 51375 b
1809	1809
1810	1810
1811	1811	SB1535- 50 -LRB103 25041 HLH 51375 b SB1535 - 50 - LRB103 25041 HLH 51375 b
1812	1812	SB1535 - 50 - LRB103 25041 HLH 51375 b
1813	1813	1 (S) For taxable years ending on or after December
1814	1814	2 31, 1997, in the case of a Subchapter S corporation, an
1815	1815	3 amount equal to all amounts of income allocable to a
1816	1816	4 shareholder subject to the Personal Property Tax
1817	1817	5 Replacement Income Tax imposed by subsections (c) and
1818	1818	6 (d) of Section 201 of this Act, including amounts
1819	1819	7 allocable to organizations exempt from federal income
1820	1820	8 tax by reason of Section 501(a) of the Internal
1821	1821	9 Revenue Code. This subparagraph (S) is exempt from the
1822	1822	10 provisions of Section 250;
1823	1823	11 (T) For taxable years 2001 and thereafter, for the
1824	1824	12 taxable year in which the bonus depreciation deduction
1825	1825	13 is taken on the taxpayer's federal income tax return
1826	1826	14 under subsection (k) of Section 168 of the Internal
1827	1827	15 Revenue Code and for each applicable taxable year
1828	1828	16 thereafter, an amount equal to "x", where:
1829	1829	17 (1) "y" equals the amount of the depreciation
1830	1830	18 deduction taken for the taxable year on the
1831	1831	19 taxpayer's federal income tax return on property
1832	1832	20 for which the bonus depreciation deduction was
1833	1833	21 taken in any year under subsection (k) of Section
1834	1834	22 168 of the Internal Revenue Code, but not
1835	1835	23 including the bonus depreciation deduction;
1836	1836	24 (2) for taxable years ending on or before
1837	1837	25 December 31, 2005, "x" equals "y" multiplied by 30
1838	1838	26 and then divided by 70 (or "y" multiplied by
1839	1839
1840	1840
1841	1841
1842	1842
1843	1843
1844	1844	SB1535 - 50 - LRB103 25041 HLH 51375 b
1845	1845
1846	1846
1847	1847	SB1535- 51 -LRB103 25041 HLH 51375 b SB1535 - 51 - LRB103 25041 HLH 51375 b
1848	1848	SB1535 - 51 - LRB103 25041 HLH 51375 b
1849	1849	1 0.429); and
1850	1850	2 (3) for taxable years ending after December
1851	1851	3 31, 2005:
1852	1852	4 (i) for property on which a bonus
1853	1853	5 depreciation deduction of 30% of the adjusted
1854	1854	6 basis was taken, "x" equals "y" multiplied by
1855	1855	7 30 and then divided by 70 (or "y" multiplied
1856	1856	8 by 0.429); and
1857	1857	9 (ii) for property on which a bonus
1858	1858	10 depreciation deduction of 50% of the adjusted
1859	1859	11 basis was taken, "x" equals "y" multiplied by
1860	1860	12 1.0;
1861	1861	13 (iii) (blank); for property on which a
1862	1862	14 bonus depreciation deduction of 100% of the
1863	1863	15 adjusted basis was taken in a taxable year
1864	1864	16 ending on or after December 31, 2021, "x"
1865	1865	17 equals the depreciation deduction that would
1866	1866	18 be allowed on that property if the taxpayer
1867	1867	19 had made the election under Section 168(k)(7)
1868	1868	20 of the Internal Revenue Code to not claim
1869	1869	21 bonus depreciation on that property; and
1870	1870	22 (iv) (blank). for property on which a
1871	1871	23 bonus depreciation deduction of a percentage
1872	1872	24 other than 30%, 50% or 100% of the adjusted
1873	1873	25 basis was taken in a taxable year ending on or
1874	1874	26 after December 31, 2021, "x" equals "y"
1875	1875
1876	1876
1877	1877
1878	1878
1879	1879
1880	1880	SB1535 - 51 - LRB103 25041 HLH 51375 b
1881	1881
1882	1882
1883	1883	SB1535- 52 -LRB103 25041 HLH 51375 b SB1535 - 52 - LRB103 25041 HLH 51375 b
1884	1884	SB1535 - 52 - LRB103 25041 HLH 51375 b
1885	1885	1 multiplied by 100 times the percentage bonus
1886	1886	2 depreciation on the property (that is,
1887	1887	3 100(bonus%)) and then divided by 100 times 1
1888	1888	4 minus the percentage bonus depreciation on the
1889	1889	5 property (that is, 100(1bonus%)).
1890	1890	6 The aggregate amount deducted under this
1891	1891	7 subparagraph in all taxable years for any one piece of
1892	1892	8 property may not exceed the amount of the bonus
1893	1893	9 depreciation deduction taken on that property on the
1894	1894	10 taxpayer's federal income tax return under subsection
1895	1895	11 (k) of Section 168 of the Internal Revenue Code. This
1896	1896	12 subparagraph (T) is exempt from the provisions of
1897	1897	13 Section 250;
1898	1898	14 (U) If the taxpayer sells, transfers, abandons, or
1899	1899	15 otherwise disposes of property for which the taxpayer
1900	1900	16 was required in any taxable year to make an addition
1901	1901	17 modification under subparagraph (E-10), then an amount
1902	1902	18 equal to that addition modification.
1903	1903	19 If the taxpayer continues to own property through
1904	1904	20 the last day of the last tax year for which the
1905	1905	21 taxpayer may claim a depreciation deduction for
1906	1906	22 federal income tax purposes a subtraction is allowed
1907	1907	23 with respect to that property under subparagraph (T)
1908	1908	24 and for which the taxpayer was required in any taxable
1909	1909	25 year to make an addition modification under
1910	1910	26 subparagraph (E-10), then an amount equal to that
1911	1911
1912	1912
1913	1913
1914	1914
1915	1915
1916	1916	SB1535 - 52 - LRB103 25041 HLH 51375 b
1917	1917
1918	1918
1919	1919	SB1535- 53 -LRB103 25041 HLH 51375 b SB1535 - 53 - LRB103 25041 HLH 51375 b
1920	1920	SB1535 - 53 - LRB103 25041 HLH 51375 b
1921	1921	1 addition modification.
1922	1922	2 The taxpayer is allowed to take the deduction
1923	1923	3 under this subparagraph only once with respect to any
1924	1924	4 one piece of property.
1925	1925	5 This subparagraph (U) is exempt from the
1926	1926	6 provisions of Section 250;
1927	1927	7 (V) The amount of: (i) any interest income (net of
1928	1928	8 the deductions allocable thereto) taken into account
1929	1929	9 for the taxable year with respect to a transaction
1930	1930	10 with a taxpayer that is required to make an addition
1931	1931	11 modification with respect to such transaction under
1932	1932	12 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
1933	1933	13 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
1934	1934	14 the amount of such addition modification, (ii) any
1935	1935	15 income from intangible property (net of the deductions
1936	1936	16 allocable thereto) taken into account for the taxable
1937	1937	17 year with respect to a transaction with a taxpayer
1938	1938	18 that is required to make an addition modification with
1939	1939	19 respect to such transaction under Section
1940	1940	20 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
1941	1941	21 203(d)(2)(D-8), but not to exceed the amount of such
1942	1942	22 addition modification, and (iii) any insurance premium
1943	1943	23 income (net of deductions allocable thereto) taken
1944	1944	24 into account for the taxable year with respect to a
1945	1945	25 transaction with a taxpayer that is required to make
1946	1946	26 an addition modification with respect to such
1947	1947
1948	1948
1949	1949
1950	1950
1951	1951
1952	1952	SB1535 - 53 - LRB103 25041 HLH 51375 b
1953	1953
1954	1954
1955	1955	SB1535- 54 -LRB103 25041 HLH 51375 b SB1535 - 54 - LRB103 25041 HLH 51375 b
1956	1956	SB1535 - 54 - LRB103 25041 HLH 51375 b
1957	1957	1 transaction under Section 203(a)(2)(D-19), Section
1958	1958	2 203(b)(2)(E-14), Section 203(c)(2)(G-14), or Section
1959	1959	3 203(d)(2)(D-9), but not to exceed the amount of that
1960	1960	4 addition modification. This subparagraph (V) is exempt
1961	1961	5 from the provisions of Section 250;
1962	1962	6 (W) An amount equal to the interest income taken
1963	1963	7 into account for the taxable year (net of the
1964	1964	8 deductions allocable thereto) with respect to
1965	1965	9 transactions with (i) a foreign person who would be a
1966	1966	10 member of the taxpayer's unitary business group but
1967	1967	11 for the fact that the foreign person's business
1968	1968	12 activity outside the United States is 80% or more of
1969	1969	13 that person's total business activity and (ii) for
1970	1970	14 taxable years ending on or after December 31, 2008, to
1971	1971	15 a person who would be a member of the same unitary
1972	1972	16 business group but for the fact that the person is
1973	1973	17 prohibited under Section 1501(a)(27) from being
1974	1974	18 included in the unitary business group because he or
1975	1975	19 she is ordinarily required to apportion business
1976	1976	20 income under different subsections of Section 304, but
1977	1977	21 not to exceed the addition modification required to be
1978	1978	22 made for the same taxable year under Section
1979	1979	23 203(b)(2)(E-12) for interest paid, accrued, or
1980	1980	24 incurred, directly or indirectly, to the same person.
1981	1981	25 This subparagraph (W) is exempt from the provisions of
1982	1982	26 Section 250;
1983	1983
1984	1984
1985	1985
1986	1986
1987	1987
1988	1988	SB1535 - 54 - LRB103 25041 HLH 51375 b
1989	1989
1990	1990
1991	1991	SB1535- 55 -LRB103 25041 HLH 51375 b SB1535 - 55 - LRB103 25041 HLH 51375 b
1992	1992	SB1535 - 55 - LRB103 25041 HLH 51375 b
1993	1993	1 (X) An amount equal to the income from intangible
1994	1994	2 property taken into account for the taxable year (net
1995	1995	3 of the deductions allocable thereto) with respect to
1996	1996	4 transactions with (i) a foreign person who would be a
1997	1997	5 member of the taxpayer's unitary business group but
1998	1998	6 for the fact that the foreign person's business
1999	1999	7 activity outside the United States is 80% or more of
2000	2000	8 that person's total business activity and (ii) for
2001	2001	9 taxable years ending on or after December 31, 2008, to
2002	2002	10 a person who would be a member of the same unitary
2003	2003	11 business group but for the fact that the person is
2004	2004	12 prohibited under Section 1501(a)(27) from being
2005	2005	13 included in the unitary business group because he or
2006	2006	14 she is ordinarily required to apportion business
2007	2007	15 income under different subsections of Section 304, but
2008	2008	16 not to exceed the addition modification required to be
2009	2009	17 made for the same taxable year under Section
2010	2010	18 203(b)(2)(E-13) for intangible expenses and costs
2011	2011	19 paid, accrued, or incurred, directly or indirectly, to
2012	2012	20 the same foreign person. This subparagraph (X) is
2013	2013	21 exempt from the provisions of Section 250;
2014	2014	22 (Y) For taxable years ending on or after December
2015	2015	23 31, 2011, in the case of a taxpayer who was required to
2016	2016	24 add back any insurance premiums under Section
2017	2017	25 203(b)(2)(E-14), such taxpayer may elect to subtract
2018	2018	26 that part of a reimbursement received from the
2019	2019
2020	2020
2021	2021
2022	2022
2023	2023
2024	2024	SB1535 - 55 - LRB103 25041 HLH 51375 b
2025	2025
2026	2026
2027	2027	SB1535- 56 -LRB103 25041 HLH 51375 b SB1535 - 56 - LRB103 25041 HLH 51375 b
2028	2028	SB1535 - 56 - LRB103 25041 HLH 51375 b
2029	2029	1 insurance company equal to the amount of the expense
2030	2030	2 or loss (including expenses incurred by the insurance
2031	2031	3 company) that would have been taken into account as a
2032	2032	4 deduction for federal income tax purposes if the
2033	2033	5 expense or loss had been uninsured. If a taxpayer
2034	2034	6 makes the election provided for by this subparagraph
2035	2035	7 (Y), the insurer to which the premiums were paid must
2036	2036	8 add back to income the amount subtracted by the
2037	2037	9 taxpayer pursuant to this subparagraph (Y). This
2038	2038	10 subparagraph (Y) is exempt from the provisions of
2039	2039	11 Section 250; and
2040	2040	12 (Z) The difference between the nondeductible
2041	2041	13 controlled foreign corporation dividends under Section
2042	2042	14 965(e)(3) of the Internal Revenue Code over the
2043	2043	15 taxable income of the taxpayer, computed without
2044	2044	16 regard to Section 965(e)(2)(A) of the Internal Revenue
2045	2045	17 Code, and without regard to any net operating loss
2046	2046	18 deduction. This subparagraph (Z) is exempt from the
2047	2047	19 provisions of Section 250.
2048	2048	20 (3) Special rule. For purposes of paragraph (2)(A),
2049	2049	21 "gross income" in the case of a life insurance company,
2050	2050	22 for tax years ending on and after December 31, 1994, and
2051	2051	23 prior to December 31, 2011, shall mean the gross
2052	2052	24 investment income for the taxable year and, for tax years
2053	2053	25 ending on or after December 31, 2011, shall mean all
2054	2054	26 amounts included in life insurance gross income under
2055	2055
2056	2056
2057	2057
2058	2058
2059	2059
2060	2060	SB1535 - 56 - LRB103 25041 HLH 51375 b
2061	2061
2062	2062
2063	2063	SB1535- 57 -LRB103 25041 HLH 51375 b SB1535 - 57 - LRB103 25041 HLH 51375 b
2064	2064	SB1535 - 57 - LRB103 25041 HLH 51375 b
2065	2065	1 Section 803(a)(3) of the Internal Revenue Code.
2066	2066	2 (c) Trusts and estates.
2067	2067	3 (1) In general. In the case of a trust or estate, base
2068	2068	4 income means an amount equal to the taxpayer's taxable
2069	2069	5 income for the taxable year as modified by paragraph (2).
2070	2070	6 (2) Modifications. Subject to the provisions of
2071	2071	7 paragraph (3), the taxable income referred to in paragraph
2072	2072	8 (1) shall be modified by adding thereto the sum of the
2073	2073	9 following amounts:
2074	2074	10 (A) An amount equal to all amounts paid or accrued
2075	2075	11 to the taxpayer as interest or dividends during the
2076	2076	12 taxable year to the extent excluded from gross income
2077	2077	13 in the computation of taxable income;
2078	2078	14 (B) In the case of (i) an estate, $600; (ii) a
2079	2079	15 trust which, under its governing instrument, is
2080	2080	16 required to distribute all of its income currently,
2081	2081	17 $300; and (iii) any other trust, $100, but in each such
2082	2082	18 case, only to the extent such amount was deducted in
2083	2083	19 the computation of taxable income;
2084	2084	20 (C) An amount equal to the amount of tax imposed by
2085	2085	21 this Act to the extent deducted from gross income in
2086	2086	22 the computation of taxable income for the taxable
2087	2087	23 year;
2088	2088	24 (D) The amount of any net operating loss deduction
2089	2089	25 taken in arriving at taxable income, other than a net
2090	2090
2091	2091
2092	2092
2093	2093
2094	2094
2095	2095	SB1535 - 57 - LRB103 25041 HLH 51375 b
2096	2096
2097	2097
2098	2098	SB1535- 58 -LRB103 25041 HLH 51375 b SB1535 - 58 - LRB103 25041 HLH 51375 b
2099	2099	SB1535 - 58 - LRB103 25041 HLH 51375 b
2100	2100	1 operating loss carried forward from a taxable year
2101	2101	2 ending prior to December 31, 1986;
2102	2102	3 (E) For taxable years in which a net operating
2103	2103	4 loss carryback or carryforward from a taxable year
2104	2104	5 ending prior to December 31, 1986 is an element of
2105	2105	6 taxable income under paragraph (1) of subsection (e)
2106	2106	7 or subparagraph (E) of paragraph (2) of subsection
2107	2107	8 (e), the amount by which addition modifications other
2108	2108	9 than those provided by this subparagraph (E) exceeded
2109	2109	10 subtraction modifications in such taxable year, with
2110	2110	11 the following limitations applied in the order that
2111	2111	12 they are listed:
2112	2112	13 (i) the addition modification relating to the
2113	2113	14 net operating loss carried back or forward to the
2114	2114	15 taxable year from any taxable year ending prior to
2115	2115	16 December 31, 1986 shall be reduced by the amount
2116	2116	17 of addition modification under this subparagraph
2117	2117	18 (E) which related to that net operating loss and
2118	2118	19 which was taken into account in calculating the
2119	2119	20 base income of an earlier taxable year, and
2120	2120	21 (ii) the addition modification relating to the
2121	2121	22 net operating loss carried back or forward to the
2122	2122	23 taxable year from any taxable year ending prior to
2123	2123	24 December 31, 1986 shall not exceed the amount of
2124	2124	25 such carryback or carryforward;
2125	2125	26 For taxable years in which there is a net
2126	2126
2127	2127
2128	2128
2129	2129
2130	2130
2131	2131	SB1535 - 58 - LRB103 25041 HLH 51375 b
2132	2132
2133	2133
2134	2134	SB1535- 59 -LRB103 25041 HLH 51375 b SB1535 - 59 - LRB103 25041 HLH 51375 b
2135	2135	SB1535 - 59 - LRB103 25041 HLH 51375 b
2136	2136	1 operating loss carryback or carryforward from more
2137	2137	2 than one other taxable year ending prior to December
2138	2138	3 31, 1986, the addition modification provided in this
2139	2139	4 subparagraph (E) shall be the sum of the amounts
2140	2140	5 computed independently under the preceding provisions
2141	2141	6 of this subparagraph (E) for each such taxable year;
2142	2142	7 (F) For taxable years ending on or after January
2143	2143	8 1, 1989, an amount equal to the tax deducted pursuant
2144	2144	9 to Section 164 of the Internal Revenue Code if the
2145	2145	10 trust or estate is claiming the same tax for purposes
2146	2146	11 of the Illinois foreign tax credit under Section 601
2147	2147	12 of this Act;
2148	2148	13 (G) An amount equal to the amount of the capital
2149	2149	14 gain deduction allowable under the Internal Revenue
2150	2150	15 Code, to the extent deducted from gross income in the
2151	2151	16 computation of taxable income;
2152	2152	17 (G-5) For taxable years ending after December 31,
2153	2153	18 1997, an amount equal to any eligible remediation
2154	2154	19 costs that the trust or estate deducted in computing
2155	2155	20 adjusted gross income and for which the trust or
2156	2156	21 estate claims a credit under subsection (l) of Section
2157	2157	22 201;
2158	2158	23 (G-10) For taxable years 2001 and thereafter, an
2159	2159	24 amount equal to the bonus depreciation deduction taken
2160	2160	25 on the taxpayer's federal income tax return for the
2161	2161	26 taxable year under subsection (k) of Section 168 of
2162	2162
2163	2163
2164	2164
2165	2165
2166	2166
2167	2167	SB1535 - 59 - LRB103 25041 HLH 51375 b
2168	2168
2169	2169
2170	2170	SB1535- 60 -LRB103 25041 HLH 51375 b SB1535 - 60 - LRB103 25041 HLH 51375 b
2171	2171	SB1535 - 60 - LRB103 25041 HLH 51375 b
2172	2172	1 the Internal Revenue Code; and
2173	2173	2 (G-11) If the taxpayer sells, transfers, abandons,
2174	2174	3 or otherwise disposes of property for which the
2175	2175	4 taxpayer was required in any taxable year to make an
2176	2176	5 addition modification under subparagraph (G-10), then
2177	2177	6 an amount equal to the aggregate amount of the
2178	2178	7 deductions taken in all taxable years under
2179	2179	8 subparagraph (R) with respect to that property.
2180	2180	9 If the taxpayer continues to own property through
2181	2181	10 the last day of the last tax year for which the
2182	2182	11 taxpayer may claim a depreciation deduction for
2183	2183	12 federal income tax purposes a subtraction is allowed
2184	2184	13 with respect to that property under subparagraph (R)
2185	2185	14 and for which the taxpayer was allowed in any taxable
2186	2186	15 year to make a subtraction modification under
2187	2187	16 subparagraph (R), then an amount equal to that
2188	2188	17 subtraction modification.
2189	2189	18 The taxpayer is required to make the addition
2190	2190	19 modification under this subparagraph only once with
2191	2191	20 respect to any one piece of property;
2192	2192	21 (G-12) An amount equal to the amount otherwise
2193	2193	22 allowed as a deduction in computing base income for
2194	2194	23 interest paid, accrued, or incurred, directly or
2195	2195	24 indirectly, (i) for taxable years ending on or after
2196	2196	25 December 31, 2004, to a foreign person who would be a
2197	2197	26 member of the same unitary business group but for the
2198	2198
2199	2199
2200	2200
2201	2201
2202	2202
2203	2203	SB1535 - 60 - LRB103 25041 HLH 51375 b
2204	2204
2205	2205
2206	2206	SB1535- 61 -LRB103 25041 HLH 51375 b SB1535 - 61 - LRB103 25041 HLH 51375 b
2207	2207	SB1535 - 61 - LRB103 25041 HLH 51375 b
2208	2208	1 fact that the foreign person's business activity
2209	2209	2 outside the United States is 80% or more of the foreign
2210	2210	3 person's total business activity and (ii) for taxable
2211	2211	4 years ending on or after December 31, 2008, to a person
2212	2212	5 who would be a member of the same unitary business
2213	2213	6 group but for the fact that the person is prohibited
2214	2214	7 under Section 1501(a)(27) from being included in the
2215	2215	8 unitary business group because he or she is ordinarily
2216	2216	9 required to apportion business income under different
2217	2217	10 subsections of Section 304. The addition modification
2218	2218	11 required by this subparagraph shall be reduced to the
2219	2219	12 extent that dividends were included in base income of
2220	2220	13 the unitary group for the same taxable year and
2221	2221	14 received by the taxpayer or by a member of the
2222	2222	15 taxpayer's unitary business group (including amounts
2223	2223	16 included in gross income pursuant to Sections 951
2224	2224	17 through 964 of the Internal Revenue Code and amounts
2225	2225	18 included in gross income under Section 78 of the
2226	2226	19 Internal Revenue Code) with respect to the stock of
2227	2227	20 the same person to whom the interest was paid,
2228	2228	21 accrued, or incurred.
2229	2229	22 This paragraph shall not apply to the following:
2230	2230	23 (i) an item of interest paid, accrued, or
2231	2231	24 incurred, directly or indirectly, to a person who
2232	2232	25 is subject in a foreign country or state, other
2233	2233	26 than a state which requires mandatory unitary
2234	2234
2235	2235
2236	2236
2237	2237
2238	2238
2239	2239	SB1535 - 61 - LRB103 25041 HLH 51375 b
2240	2240
2241	2241
2242	2242	SB1535- 62 -LRB103 25041 HLH 51375 b SB1535 - 62 - LRB103 25041 HLH 51375 b
2243	2243	SB1535 - 62 - LRB103 25041 HLH 51375 b
2244	2244	1 reporting, to a tax on or measured by net income
2245	2245	2 with respect to such interest; or
2246	2246	3 (ii) an item of interest paid, accrued, or
2247	2247	4 incurred, directly or indirectly, to a person if
2248	2248	5 the taxpayer can establish, based on a
2249	2249	6 preponderance of the evidence, both of the
2250	2250	7 following:
2251	2251	8 (a) the person, during the same taxable
2252	2252	9 year, paid, accrued, or incurred, the interest
2253	2253	10 to a person that is not a related member, and
2254	2254	11 (b) the transaction giving rise to the
2255	2255	12 interest expense between the taxpayer and the
2256	2256	13 person did not have as a principal purpose the
2257	2257	14 avoidance of Illinois income tax, and is paid
2258	2258	15 pursuant to a contract or agreement that
2259	2259	16 reflects an arm's-length interest rate and
2260	2260	17 terms; or
2261	2261	18 (iii) the taxpayer can establish, based on
2262	2262	19 clear and convincing evidence, that the interest
2263	2263	20 paid, accrued, or incurred relates to a contract
2264	2264	21 or agreement entered into at arm's-length rates
2265	2265	22 and terms and the principal purpose for the
2266	2266	23 payment is not federal or Illinois tax avoidance;
2267	2267	24 or
2268	2268	25 (iv) an item of interest paid, accrued, or
2269	2269	26 incurred, directly or indirectly, to a person if
2270	2270
2271	2271
2272	2272
2273	2273
2274	2274
2275	2275	SB1535 - 62 - LRB103 25041 HLH 51375 b
2276	2276
2277	2277
2278	2278	SB1535- 63 -LRB103 25041 HLH 51375 b SB1535 - 63 - LRB103 25041 HLH 51375 b
2279	2279	SB1535 - 63 - LRB103 25041 HLH 51375 b
2280	2280	1 the taxpayer establishes by clear and convincing
2281	2281	2 evidence that the adjustments are unreasonable; or
2282	2282	3 if the taxpayer and the Director agree in writing
2283	2283	4 to the application or use of an alternative method
2284	2284	5 of apportionment under Section 304(f).
2285	2285	6 Nothing in this subsection shall preclude the
2286	2286	7 Director from making any other adjustment
2287	2287	8 otherwise allowed under Section 404 of this Act
2288	2288	9 for any tax year beginning after the effective
2289	2289	10 date of this amendment provided such adjustment is
2290	2290	11 made pursuant to regulation adopted by the
2291	2291	12 Department and such regulations provide methods
2292	2292	13 and standards by which the Department will utilize
2293	2293	14 its authority under Section 404 of this Act;
2294	2294	15 (G-13) An amount equal to the amount of intangible
2295	2295	16 expenses and costs otherwise allowed as a deduction in
2296	2296	17 computing base income, and that were paid, accrued, or
2297	2297	18 incurred, directly or indirectly, (i) for taxable
2298	2298	19 years ending on or after December 31, 2004, to a
2299	2299	20 foreign person who would be a member of the same
2300	2300	21 unitary business group but for the fact that the
2301	2301	22 foreign person's business activity outside the United
2302	2302	23 States is 80% or more of that person's total business
2303	2303	24 activity and (ii) for taxable years ending on or after
2304	2304	25 December 31, 2008, to a person who would be a member of
2305	2305	26 the same unitary business group but for the fact that
2306	2306
2307	2307
2308	2308
2309	2309
2310	2310
2311	2311	SB1535 - 63 - LRB103 25041 HLH 51375 b
2312	2312
2313	2313
2314	2314	SB1535- 64 -LRB103 25041 HLH 51375 b SB1535 - 64 - LRB103 25041 HLH 51375 b
2315	2315	SB1535 - 64 - LRB103 25041 HLH 51375 b
2316	2316	1 the person is prohibited under Section 1501(a)(27)
2317	2317	2 from being included in the unitary business group
2318	2318	3 because he or she is ordinarily required to apportion
2319	2319	4 business income under different subsections of Section
2320	2320	5 304. The addition modification required by this
2321	2321	6 subparagraph shall be reduced to the extent that
2322	2322	7 dividends were included in base income of the unitary
2323	2323	8 group for the same taxable year and received by the
2324	2324	9 taxpayer or by a member of the taxpayer's unitary
2325	2325	10 business group (including amounts included in gross
2326	2326	11 income pursuant to Sections 951 through 964 of the
2327	2327	12 Internal Revenue Code and amounts included in gross
2328	2328	13 income under Section 78 of the Internal Revenue Code)
2329	2329	14 with respect to the stock of the same person to whom
2330	2330	15 the intangible expenses and costs were directly or
2331	2331	16 indirectly paid, incurred, or accrued. The preceding
2332	2332	17 sentence shall not apply to the extent that the same
2333	2333	18 dividends caused a reduction to the addition
2334	2334	19 modification required under Section 203(c)(2)(G-12) of
2335	2335	20 this Act. As used in this subparagraph, the term
2336	2336	21 "intangible expenses and costs" includes: (1)
2337	2337	22 expenses, losses, and costs for or related to the
2338	2338	23 direct or indirect acquisition, use, maintenance or
2339	2339	24 management, ownership, sale, exchange, or any other
2340	2340	25 disposition of intangible property; (2) losses
2341	2341	26 incurred, directly or indirectly, from factoring
2342	2342
2343	2343
2344	2344
2345	2345
2346	2346
2347	2347	SB1535 - 64 - LRB103 25041 HLH 51375 b
2348	2348
2349	2349
2350	2350	SB1535- 65 -LRB103 25041 HLH 51375 b SB1535 - 65 - LRB103 25041 HLH 51375 b
2351	2351	SB1535 - 65 - LRB103 25041 HLH 51375 b
2352	2352	1 transactions or discounting transactions; (3) royalty,
2353	2353	2 patent, technical, and copyright fees; (4) licensing
2354	2354	3 fees; and (5) other similar expenses and costs. For
2355	2355	4 purposes of this subparagraph, "intangible property"
2356	2356	5 includes patents, patent applications, trade names,
2357	2357	6 trademarks, service marks, copyrights, mask works,
2358	2358	7 trade secrets, and similar types of intangible assets.
2359	2359	8 This paragraph shall not apply to the following:
2360	2360	9 (i) any item of intangible expenses or costs
2361	2361	10 paid, accrued, or incurred, directly or
2362	2362	11 indirectly, from a transaction with a person who
2363	2363	12 is subject in a foreign country or state, other
2364	2364	13 than a state which requires mandatory unitary
2365	2365	14 reporting, to a tax on or measured by net income
2366	2366	15 with respect to such item; or
2367	2367	16 (ii) any item of intangible expense or cost
2368	2368	17 paid, accrued, or incurred, directly or
2369	2369	18 indirectly, if the taxpayer can establish, based
2370	2370	19 on a preponderance of the evidence, both of the
2371	2371	20 following:
2372	2372	21 (a) the person during the same taxable
2373	2373	22 year paid, accrued, or incurred, the
2374	2374	23 intangible expense or cost to a person that is
2375	2375	24 not a related member, and
2376	2376	25 (b) the transaction giving rise to the
2377	2377	26 intangible expense or cost between the
2378	2378
2379	2379
2380	2380
2381	2381
2382	2382
2383	2383	SB1535 - 65 - LRB103 25041 HLH 51375 b
2384	2384
2385	2385
2386	2386	SB1535- 66 -LRB103 25041 HLH 51375 b SB1535 - 66 - LRB103 25041 HLH 51375 b
2387	2387	SB1535 - 66 - LRB103 25041 HLH 51375 b
2388	2388	1 taxpayer and the person did not have as a
2389	2389	2 principal purpose the avoidance of Illinois
2390	2390	3 income tax, and is paid pursuant to a contract
2391	2391	4 or agreement that reflects arm's-length terms;
2392	2392	5 or
2393	2393	6 (iii) any item of intangible expense or cost
2394	2394	7 paid, accrued, or incurred, directly or
2395	2395	8 indirectly, from a transaction with a person if
2396	2396	9 the taxpayer establishes by clear and convincing
2397	2397	10 evidence, that the adjustments are unreasonable;
2398	2398	11 or if the taxpayer and the Director agree in
2399	2399	12 writing to the application or use of an
2400	2400	13 alternative method of apportionment under Section
2401	2401	14 304(f);
2402	2402	15 Nothing in this subsection shall preclude the
2403	2403	16 Director from making any other adjustment
2404	2404	17 otherwise allowed under Section 404 of this Act
2405	2405	18 for any tax year beginning after the effective
2406	2406	19 date of this amendment provided such adjustment is
2407	2407	20 made pursuant to regulation adopted by the
2408	2408	21 Department and such regulations provide methods
2409	2409	22 and standards by which the Department will utilize
2410	2410	23 its authority under Section 404 of this Act;
2411	2411	24 (G-14) For taxable years ending on or after
2412	2412	25 December 31, 2008, an amount equal to the amount of
2413	2413	26 insurance premium expenses and costs otherwise allowed
2414	2414
2415	2415
2416	2416
2417	2417
2418	2418
2419	2419	SB1535 - 66 - LRB103 25041 HLH 51375 b
2420	2420
2421	2421
2422	2422	SB1535- 67 -LRB103 25041 HLH 51375 b SB1535 - 67 - LRB103 25041 HLH 51375 b
2423	2423	SB1535 - 67 - LRB103 25041 HLH 51375 b
2424	2424	1 as a deduction in computing base income, and that were
2425	2425	2 paid, accrued, or incurred, directly or indirectly, to
2426	2426	3 a person who would be a member of the same unitary
2427	2427	4 business group but for the fact that the person is
2428	2428	5 prohibited under Section 1501(a)(27) from being
2429	2429	6 included in the unitary business group because he or
2430	2430	7 she is ordinarily required to apportion business
2431	2431	8 income under different subsections of Section 304. The
2432	2432	9 addition modification required by this subparagraph
2433	2433	10 shall be reduced to the extent that dividends were
2434	2434	11 included in base income of the unitary group for the
2435	2435	12 same taxable year and received by the taxpayer or by a
2436	2436	13 member of the taxpayer's unitary business group
2437	2437	14 (including amounts included in gross income under
2438	2438	15 Sections 951 through 964 of the Internal Revenue Code
2439	2439	16 and amounts included in gross income under Section 78
2440	2440	17 of the Internal Revenue Code) with respect to the
2441	2441	18 stock of the same person to whom the premiums and costs
2442	2442	19 were directly or indirectly paid, incurred, or
2443	2443	20 accrued. The preceding sentence does not apply to the
2444	2444	21 extent that the same dividends caused a reduction to
2445	2445	22 the addition modification required under Section
2446	2446	23 203(c)(2)(G-12) or Section 203(c)(2)(G-13) of this
2447	2447	24 Act;
2448	2448	25 (G-15) An amount equal to the credit allowable to
2449	2449	26 the taxpayer under Section 218(a) of this Act,
2450	2450
2451	2451
2452	2452
2453	2453
2454	2454
2455	2455	SB1535 - 67 - LRB103 25041 HLH 51375 b
2456	2456
2457	2457
2458	2458	SB1535- 68 -LRB103 25041 HLH 51375 b SB1535 - 68 - LRB103 25041 HLH 51375 b
2459	2459	SB1535 - 68 - LRB103 25041 HLH 51375 b
2460	2460	1 determined without regard to Section 218(c) of this
2461	2461	2 Act;
2462	2462	3 (G-16) For taxable years ending on or after
2463	2463	4 December 31, 2017, an amount equal to the deduction
2464	2464	5 allowed under Section 199 of the Internal Revenue Code
2465	2465	6 for the taxable year;
2466	2466	7 and by deducting from the total so obtained the sum of the
2467	2467	8 following amounts:
2468	2468	9 (H) An amount equal to all amounts included in
2469	2469	10 such total pursuant to the provisions of Sections
2470	2470	11 402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and 408
2471	2471	12 of the Internal Revenue Code or included in such total
2472	2472	13 as distributions under the provisions of any
2473	2473	14 retirement or disability plan for employees of any
2474	2474	15 governmental agency or unit, or retirement payments to
2475	2475	16 retired partners, which payments are excluded in
2476	2476	17 computing net earnings from self employment by Section
2477	2477	18 1402 of the Internal Revenue Code and regulations
2478	2478	19 adopted pursuant thereto;
2479	2479	20 (I) The valuation limitation amount;
2480	2480	21 (J) An amount equal to the amount of any tax
2481	2481	22 imposed by this Act which was refunded to the taxpayer
2482	2482	23 and included in such total for the taxable year;
2483	2483	24 (K) An amount equal to all amounts included in
2484	2484	25 taxable income as modified by subparagraphs (A), (B),
2485	2485	26 (C), (D), (E), (F) and (G) which are exempt from
2486	2486
2487	2487
2488	2488
2489	2489
2490	2490
2491	2491	SB1535 - 68 - LRB103 25041 HLH 51375 b
2492	2492
2493	2493
2494	2494	SB1535- 69 -LRB103 25041 HLH 51375 b SB1535 - 69 - LRB103 25041 HLH 51375 b
2495	2495	SB1535 - 69 - LRB103 25041 HLH 51375 b
2496	2496	1 taxation by this State either by reason of its
2497	2497	2 statutes or Constitution or by reason of the
2498	2498	3 Constitution, treaties or statutes of the United
2499	2499	4 States; provided that, in the case of any statute of
2500	2500	5 this State that exempts income derived from bonds or
2501	2501	6 other obligations from the tax imposed under this Act,
2502	2502	7 the amount exempted shall be the interest net of bond
2503	2503	8 premium amortization;
2504	2504	9 (L) With the exception of any amounts subtracted
2505	2505	10 under subparagraph (K), an amount equal to the sum of
2506	2506	11 all amounts disallowed as deductions by (i) Sections
2507	2507	12 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
2508	2508	13 and all amounts of expenses allocable to interest and
2509	2509	14 disallowed as deductions by Section 265(a)(1) of the
2510	2510	15 Internal Revenue Code; and (ii) for taxable years
2511	2511	16 ending on or after August 13, 1999, Sections
2512	2512	17 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
2513	2513	18 Internal Revenue Code, plus, (iii) for taxable years
2514	2514	19 ending on or after December 31, 2011, Section
2515	2515	20 45G(e)(3) of the Internal Revenue Code and, for
2516	2516	21 taxable years ending on or after December 31, 2008,
2517	2517	22 any amount included in gross income under Section 87
2518	2518	23 of the Internal Revenue Code; the provisions of this
2519	2519	24 subparagraph are exempt from the provisions of Section
2520	2520	25 250;
2521	2521	26 (M) An amount equal to those dividends included in
2522	2522
2523	2523
2524	2524
2525	2525
2526	2526
2527	2527	SB1535 - 69 - LRB103 25041 HLH 51375 b
2528	2528
2529	2529
2530	2530	SB1535- 70 -LRB103 25041 HLH 51375 b SB1535 - 70 - LRB103 25041 HLH 51375 b
2531	2531	SB1535 - 70 - LRB103 25041 HLH 51375 b
2532	2532	1 such total which were paid by a corporation which
2533	2533	2 conducts business operations in a River Edge
2534	2534	3 Redevelopment Zone or zones created under the River
2535	2535	4 Edge Redevelopment Zone Act and conducts substantially
2536	2536	5 all of its operations in a River Edge Redevelopment
2537	2537	6 Zone or zones. This subparagraph (M) is exempt from
2538	2538	7 the provisions of Section 250;
2539	2539	8 (N) An amount equal to any contribution made to a
2540	2540	9 job training project established pursuant to the Tax
2541	2541	10 Increment Allocation Redevelopment Act;
2542	2542	11 (O) An amount equal to those dividends included in
2543	2543	12 such total that were paid by a corporation that
2544	2544	13 conducts business operations in a federally designated
2545	2545	14 Foreign Trade Zone or Sub-Zone and that is designated
2546	2546	15 a High Impact Business located in Illinois; provided
2547	2547	16 that dividends eligible for the deduction provided in
2548	2548	17 subparagraph (M) of paragraph (2) of this subsection
2549	2549	18 shall not be eligible for the deduction provided under
2550	2550	19 this subparagraph (O);
2551	2551	20 (P) An amount equal to the amount of the deduction
2552	2552	21 used to compute the federal income tax credit for
2553	2553	22 restoration of substantial amounts held under claim of
2554	2554	23 right for the taxable year pursuant to Section 1341 of
2555	2555	24 the Internal Revenue Code;
2556	2556	25 (Q) For taxable year 1999 and thereafter, an
2557	2557	26 amount equal to the amount of any (i) distributions,
2558	2558
2559	2559
2560	2560
2561	2561
2562	2562
2563	2563	SB1535 - 70 - LRB103 25041 HLH 51375 b
2564	2564
2565	2565
2566	2566	SB1535- 71 -LRB103 25041 HLH 51375 b SB1535 - 71 - LRB103 25041 HLH 51375 b
2567	2567	SB1535 - 71 - LRB103 25041 HLH 51375 b
2568	2568	1 to the extent includible in gross income for federal
2569	2569	2 income tax purposes, made to the taxpayer because of
2570	2570	3 his or her status as a victim of persecution for racial
2571	2571	4 or religious reasons by Nazi Germany or any other Axis
2572	2572	5 regime or as an heir of the victim and (ii) items of
2573	2573	6 income, to the extent includible in gross income for
2574	2574	7 federal income tax purposes, attributable to, derived
2575	2575	8 from or in any way related to assets stolen from,
2576	2576	9 hidden from, or otherwise lost to a victim of
2577	2577	10 persecution for racial or religious reasons by Nazi
2578	2578	11 Germany or any other Axis regime immediately prior to,
2579	2579	12 during, and immediately after World War II, including,
2580	2580	13 but not limited to, interest on the proceeds
2581	2581	14 receivable as insurance under policies issued to a
2582	2582	15 victim of persecution for racial or religious reasons
2583	2583	16 by Nazi Germany or any other Axis regime by European
2584	2584	17 insurance companies immediately prior to and during
2585	2585	18 World War II; provided, however, this subtraction from
2586	2586	19 federal adjusted gross income does not apply to assets
2587	2587	20 acquired with such assets or with the proceeds from
2588	2588	21 the sale of such assets; provided, further, this
2589	2589	22 paragraph shall only apply to a taxpayer who was the
2590	2590	23 first recipient of such assets after their recovery
2591	2591	24 and who is a victim of persecution for racial or
2592	2592	25 religious reasons by Nazi Germany or any other Axis
2593	2593	26 regime or as an heir of the victim. The amount of and
2594	2594
2595	2595
2596	2596
2597	2597
2598	2598
2599	2599	SB1535 - 71 - LRB103 25041 HLH 51375 b
2600	2600
2601	2601
2602	2602	SB1535- 72 -LRB103 25041 HLH 51375 b SB1535 - 72 - LRB103 25041 HLH 51375 b
2603	2603	SB1535 - 72 - LRB103 25041 HLH 51375 b
2604	2604	1 the eligibility for any public assistance, benefit, or
2605	2605	2 similar entitlement is not affected by the inclusion
2606	2606	3 of items (i) and (ii) of this paragraph in gross income
2607	2607	4 for federal income tax purposes. This paragraph is
2608	2608	5 exempt from the provisions of Section 250;
2609	2609	6 (R) For taxable years 2001 and thereafter, for the
2610	2610	7 taxable year in which the bonus depreciation deduction
2611	2611	8 is taken on the taxpayer's federal income tax return
2612	2612	9 under subsection (k) of Section 168 of the Internal
2613	2613	10 Revenue Code and for each applicable taxable year
2614	2614	11 thereafter, an amount equal to "x", where:
2615	2615	12 (1) "y" equals the amount of the depreciation
2616	2616	13 deduction taken for the taxable year on the
2617	2617	14 taxpayer's federal income tax return on property
2618	2618	15 for which the bonus depreciation deduction was
2619	2619	16 taken in any year under subsection (k) of Section
2620	2620	17 168 of the Internal Revenue Code, but not
2621	2621	18 including the bonus depreciation deduction;
2622	2622	19 (2) for taxable years ending on or before
2623	2623	20 December 31, 2005, "x" equals "y" multiplied by 30
2624	2624	21 and then divided by 70 (or "y" multiplied by
2625	2625	22 0.429); and
2626	2626	23 (3) for taxable years ending after December
2627	2627	24 31, 2005:
2628	2628	25 (i) for property on which a bonus
2629	2629	26 depreciation deduction of 30% of the adjusted
2630	2630
2631	2631
2632	2632
2633	2633
2634	2634
2635	2635	SB1535 - 72 - LRB103 25041 HLH 51375 b
2636	2636
2637	2637
2638	2638	SB1535- 73 -LRB103 25041 HLH 51375 b SB1535 - 73 - LRB103 25041 HLH 51375 b
2639	2639	SB1535 - 73 - LRB103 25041 HLH 51375 b
2640	2640	1 basis was taken, "x" equals "y" multiplied by
2641	2641	2 30 and then divided by 70 (or "y" multiplied
2642	2642	3 by 0.429); and
2643	2643	4 (ii) for property on which a bonus
2644	2644	5 depreciation deduction of 50% of the adjusted
2645	2645	6 basis was taken, "x" equals "y" multiplied by
2646	2646	7 1.0;
2647	2647	8 (iii) (blank); for property on which a
2648	2648	9 bonus depreciation deduction of 100% of the
2649	2649	10 adjusted basis was taken in a taxable year
2650	2650	11 ending on or after December 31, 2021, "x"
2651	2651	12 equals the depreciation deduction that would
2652	2652	13 be allowed on that property if the taxpayer
2653	2653	14 had made the election under Section 168(k)(7)
2654	2654	15 of the Internal Revenue Code to not claim
2655	2655	16 bonus depreciation on that property; and
2656	2656	17 (iv) (blank). for property on which a
2657	2657	18 bonus depreciation deduction of a percentage
2658	2658	19 other than 30%, 50% or 100% of the adjusted
2659	2659	20 basis was taken in a taxable year ending on or
2660	2660	21 after December 31, 2021, "x" equals "y"
2661	2661	22 multiplied by 100 times the percentage bonus
2662	2662	23 depreciation on the property (that is,
2663	2663	24 100(bonus%)) and then divided by 100 times 1
2664	2664	25 minus the percentage bonus depreciation on the
2665	2665	26 property (that is, 100(1bonus%)).
2666	2666
2667	2667
2668	2668
2669	2669
2670	2670
2671	2671	SB1535 - 73 - LRB103 25041 HLH 51375 b
2672	2672
2673	2673
2674	2674	SB1535- 74 -LRB103 25041 HLH 51375 b SB1535 - 74 - LRB103 25041 HLH 51375 b
2675	2675	SB1535 - 74 - LRB103 25041 HLH 51375 b
2676	2676	1 The aggregate amount deducted under this
2677	2677	2 subparagraph in all taxable years for any one piece of
2678	2678	3 property may not exceed the amount of the bonus
2679	2679	4 depreciation deduction taken on that property on the
2680	2680	5 taxpayer's federal income tax return under subsection
2681	2681	6 (k) of Section 168 of the Internal Revenue Code. This
2682	2682	7 subparagraph (R) is exempt from the provisions of
2683	2683	8 Section 250;
2684	2684	9 (S) If the taxpayer sells, transfers, abandons, or
2685	2685	10 otherwise disposes of property for which the taxpayer
2686	2686	11 was required in any taxable year to make an addition
2687	2687	12 modification under subparagraph (G-10), then an amount
2688	2688	13 equal to that addition modification.
2689	2689	14 If the taxpayer continues to own property through
2690	2690	15 the last day of the last tax year for which the
2691	2691	16 taxpayer may claim a depreciation deduction for
2692	2692	17 federal income tax purposes a subtraction is allowed
2693	2693	18 with respect to that property under subparagraph (R)
2694	2694	19 and for which the taxpayer was required in any taxable
2695	2695	20 year to make an addition modification under
2696	2696	21 subparagraph (G-10), then an amount equal to that
2697	2697	22 addition modification.
2698	2698	23 The taxpayer is allowed to take the deduction
2699	2699	24 under this subparagraph only once with respect to any
2700	2700	25 one piece of property.
2701	2701	26 This subparagraph (S) is exempt from the
2702	2702
2703	2703
2704	2704
2705	2705
2706	2706
2707	2707	SB1535 - 74 - LRB103 25041 HLH 51375 b
2708	2708
2709	2709
2710	2710	SB1535- 75 -LRB103 25041 HLH 51375 b SB1535 - 75 - LRB103 25041 HLH 51375 b
2711	2711	SB1535 - 75 - LRB103 25041 HLH 51375 b
2712	2712	1 provisions of Section 250;
2713	2713	2 (T) The amount of (i) any interest income (net of
2714	2714	3 the deductions allocable thereto) taken into account
2715	2715	4 for the taxable year with respect to a transaction
2716	2716	5 with a taxpayer that is required to make an addition
2717	2717	6 modification with respect to such transaction under
2718	2718	7 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
2719	2719	8 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
2720	2720	9 the amount of such addition modification and (ii) any
2721	2721	10 income from intangible property (net of the deductions
2722	2722	11 allocable thereto) taken into account for the taxable
2723	2723	12 year with respect to a transaction with a taxpayer
2724	2724	13 that is required to make an addition modification with
2725	2725	14 respect to such transaction under Section
2726	2726	15 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
2727	2727	16 203(d)(2)(D-8), but not to exceed the amount of such
2728	2728	17 addition modification. This subparagraph (T) is exempt
2729	2729	18 from the provisions of Section 250;
2730	2730	19 (U) An amount equal to the interest income taken
2731	2731	20 into account for the taxable year (net of the
2732	2732	21 deductions allocable thereto) with respect to
2733	2733	22 transactions with (i) a foreign person who would be a
2734	2734	23 member of the taxpayer's unitary business group but
2735	2735	24 for the fact the foreign person's business activity
2736	2736	25 outside the United States is 80% or more of that
2737	2737	26 person's total business activity and (ii) for taxable
2738	2738
2739	2739
2740	2740
2741	2741
2742	2742
2743	2743	SB1535 - 75 - LRB103 25041 HLH 51375 b
2744	2744
2745	2745
2746	2746	SB1535- 76 -LRB103 25041 HLH 51375 b SB1535 - 76 - LRB103 25041 HLH 51375 b
2747	2747	SB1535 - 76 - LRB103 25041 HLH 51375 b
2748	2748	1 years ending on or after December 31, 2008, to a person
2749	2749	2 who would be a member of the same unitary business
2750	2750	3 group but for the fact that the person is prohibited
2751	2751	4 under Section 1501(a)(27) from being included in the
2752	2752	5 unitary business group because he or she is ordinarily
2753	2753	6 required to apportion business income under different
2754	2754	7 subsections of Section 304, but not to exceed the
2755	2755	8 addition modification required to be made for the same
2756	2756	9 taxable year under Section 203(c)(2)(G-12) for
2757	2757	10 interest paid, accrued, or incurred, directly or
2758	2758	11 indirectly, to the same person. This subparagraph (U)
2759	2759	12 is exempt from the provisions of Section 250;
2760	2760	13 (V) An amount equal to the income from intangible
2761	2761	14 property taken into account for the taxable year (net
2762	2762	15 of the deductions allocable thereto) with respect to
2763	2763	16 transactions with (i) a foreign person who would be a
2764	2764	17 member of the taxpayer's unitary business group but
2765	2765	18 for the fact that the foreign person's business
2766	2766	19 activity outside the United States is 80% or more of
2767	2767	20 that person's total business activity and (ii) for
2768	2768	21 taxable years ending on or after December 31, 2008, to
2769	2769	22 a person who would be a member of the same unitary
2770	2770	23 business group but for the fact that the person is
2771	2771	24 prohibited under Section 1501(a)(27) from being
2772	2772	25 included in the unitary business group because he or
2773	2773	26 she is ordinarily required to apportion business
2774	2774
2775	2775
2776	2776
2777	2777
2778	2778
2779	2779	SB1535 - 76 - LRB103 25041 HLH 51375 b
2780	2780
2781	2781
2782	2782	SB1535- 77 -LRB103 25041 HLH 51375 b SB1535 - 77 - LRB103 25041 HLH 51375 b
2783	2783	SB1535 - 77 - LRB103 25041 HLH 51375 b
2784	2784	1 income under different subsections of Section 304, but
2785	2785	2 not to exceed the addition modification required to be
2786	2786	3 made for the same taxable year under Section
2787	2787	4 203(c)(2)(G-13) for intangible expenses and costs
2788	2788	5 paid, accrued, or incurred, directly or indirectly, to
2789	2789	6 the same foreign person. This subparagraph (V) is
2790	2790	7 exempt from the provisions of Section 250;
2791	2791	8 (W) in the case of an estate, an amount equal to
2792	2792	9 all amounts included in such total pursuant to the
2793	2793	10 provisions of Section 111 of the Internal Revenue Code
2794	2794	11 as a recovery of items previously deducted by the
2795	2795	12 decedent from adjusted gross income in the computation
2796	2796	13 of taxable income. This subparagraph (W) is exempt
2797	2797	14 from Section 250;
2798	2798	15 (X) an amount equal to the refund included in such
2799	2799	16 total of any tax deducted for federal income tax
2800	2800	17 purposes, to the extent that deduction was added back
2801	2801	18 under subparagraph (F). This subparagraph (X) is
2802	2802	19 exempt from the provisions of Section 250;
2803	2803	20 (Y) For taxable years ending on or after December
2804	2804	21 31, 2011, in the case of a taxpayer who was required to
2805	2805	22 add back any insurance premiums under Section
2806	2806	23 203(c)(2)(G-14), such taxpayer may elect to subtract
2807	2807	24 that part of a reimbursement received from the
2808	2808	25 insurance company equal to the amount of the expense
2809	2809	26 or loss (including expenses incurred by the insurance
2810	2810
2811	2811
2812	2812
2813	2813
2814	2814
2815	2815	SB1535 - 77 - LRB103 25041 HLH 51375 b
2816	2816
2817	2817
2818	2818	SB1535- 78 -LRB103 25041 HLH 51375 b SB1535 - 78 - LRB103 25041 HLH 51375 b
2819	2819	SB1535 - 78 - LRB103 25041 HLH 51375 b
2820	2820	1 company) that would have been taken into account as a
2821	2821	2 deduction for federal income tax purposes if the
2822	2822	3 expense or loss had been uninsured. If a taxpayer
2823	2823	4 makes the election provided for by this subparagraph
2824	2824	5 (Y), the insurer to which the premiums were paid must
2825	2825	6 add back to income the amount subtracted by the
2826	2826	7 taxpayer pursuant to this subparagraph (Y). This
2827	2827	8 subparagraph (Y) is exempt from the provisions of
2828	2828	9 Section 250; and
2829	2829	10 (Z) For taxable years beginning after December 31,
2830	2830	11 2018 and before January 1, 2026, the amount of excess
2831	2831	12 business loss of the taxpayer disallowed as a
2832	2832	13 deduction by Section 461(l)(1)(B) of the Internal
2833	2833	14 Revenue Code.
2834	2834	15 (3) Limitation. The amount of any modification
2835	2835	16 otherwise required under this subsection shall, under
2836	2836	17 regulations prescribed by the Department, be adjusted by
2837	2837	18 any amounts included therein which were properly paid,
2838	2838	19 credited, or required to be distributed, or permanently
2839	2839	20 set aside for charitable purposes pursuant to Internal
2840	2840	21 Revenue Code Section 642(c) during the taxable year.
2841	2841	22 (d) Partnerships.
2842	2842	23 (1) In general. In the case of a partnership, base
2843	2843	24 income means an amount equal to the taxpayer's taxable
2844	2844	25 income for the taxable year as modified by paragraph (2).
2845	2845
2846	2846
2847	2847
2848	2848
2849	2849
2850	2850	SB1535 - 78 - LRB103 25041 HLH 51375 b
2851	2851
2852	2852
2853	2853	SB1535- 79 -LRB103 25041 HLH 51375 b SB1535 - 79 - LRB103 25041 HLH 51375 b
2854	2854	SB1535 - 79 - LRB103 25041 HLH 51375 b
2855	2855	1 (2) Modifications. The taxable income referred to in
2856	2856	2 paragraph (1) shall be modified by adding thereto the sum
2857	2857	3 of the following amounts:
2858	2858	4 (A) An amount equal to all amounts paid or accrued
2859	2859	5 to the taxpayer as interest or dividends during the
2860	2860	6 taxable year to the extent excluded from gross income
2861	2861	7 in the computation of taxable income;
2862	2862	8 (B) An amount equal to the amount of tax imposed by
2863	2863	9 this Act to the extent deducted from gross income for
2864	2864	10 the taxable year;
2865	2865	11 (C) The amount of deductions allowed to the
2866	2866	12 partnership pursuant to Section 707 (c) of the
2867	2867	13 Internal Revenue Code in calculating its taxable
2868	2868	14 income;
2869	2869	15 (D) An amount equal to the amount of the capital
2870	2870	16 gain deduction allowable under the Internal Revenue
2871	2871	17 Code, to the extent deducted from gross income in the
2872	2872	18 computation of taxable income;
2873	2873	19 (D-5) For taxable years 2001 and thereafter, an
2874	2874	20 amount equal to the bonus depreciation deduction taken
2875	2875	21 on the taxpayer's federal income tax return for the
2876	2876	22 taxable year under subsection (k) of Section 168 of
2877	2877	23 the Internal Revenue Code;
2878	2878	24 (D-6) If the taxpayer sells, transfers, abandons,
2879	2879	25 or otherwise disposes of property for which the
2880	2880	26 taxpayer was required in any taxable year to make an
2881	2881
2882	2882
2883	2883
2884	2884
2885	2885
2886	2886	SB1535 - 79 - LRB103 25041 HLH 51375 b
2887	2887
2888	2888
2889	2889	SB1535- 80 -LRB103 25041 HLH 51375 b SB1535 - 80 - LRB103 25041 HLH 51375 b
2890	2890	SB1535 - 80 - LRB103 25041 HLH 51375 b
2891	2891	1 addition modification under subparagraph (D-5), then
2892	2892	2 an amount equal to the aggregate amount of the
2893	2893	3 deductions taken in all taxable years under
2894	2894	4 subparagraph (O) with respect to that property.
2895	2895	5 If the taxpayer continues to own property through
2896	2896	6 the last day of the last tax year for which the
2897	2897	7 taxpayer may claim a depreciation deduction for
2898	2898	8 federal income tax purposes a subtraction is allowed
2899	2899	9 with respect to that property under subparagraph (O)
2900	2900	10 and for which the taxpayer was allowed in any taxable
2901	2901	11 year to make a subtraction modification under
2902	2902	12 subparagraph (O), then an amount equal to that
2903	2903	13 subtraction modification.
2904	2904	14 The taxpayer is required to make the addition
2905	2905	15 modification under this subparagraph only once with
2906	2906	16 respect to any one piece of property;
2907	2907	17 (D-7) An amount equal to the amount otherwise
2908	2908	18 allowed as a deduction in computing base income for
2909	2909	19 interest paid, accrued, or incurred, directly or
2910	2910	20 indirectly, (i) for taxable years ending on or after
2911	2911	21 December 31, 2004, to a foreign person who would be a
2912	2912	22 member of the same unitary business group but for the
2913	2913	23 fact the foreign person's business activity outside
2914	2914	24 the United States is 80% or more of the foreign
2915	2915	25 person's total business activity and (ii) for taxable
2916	2916	26 years ending on or after December 31, 2008, to a person
2917	2917
2918	2918
2919	2919
2920	2920
2921	2921
2922	2922	SB1535 - 80 - LRB103 25041 HLH 51375 b
2923	2923
2924	2924
2925	2925	SB1535- 81 -LRB103 25041 HLH 51375 b SB1535 - 81 - LRB103 25041 HLH 51375 b
2926	2926	SB1535 - 81 - LRB103 25041 HLH 51375 b
2927	2927	1 who would be a member of the same unitary business
2928	2928	2 group but for the fact that the person is prohibited
2929	2929	3 under Section 1501(a)(27) from being included in the
2930	2930	4 unitary business group because he or she is ordinarily
2931	2931	5 required to apportion business income under different
2932	2932	6 subsections of Section 304. The addition modification
2933	2933	7 required by this subparagraph shall be reduced to the
2934	2934	8 extent that dividends were included in base income of
2935	2935	9 the unitary group for the same taxable year and
2936	2936	10 received by the taxpayer or by a member of the
2937	2937	11 taxpayer's unitary business group (including amounts
2938	2938	12 included in gross income pursuant to Sections 951
2939	2939	13 through 964 of the Internal Revenue Code and amounts
2940	2940	14 included in gross income under Section 78 of the
2941	2941	15 Internal Revenue Code) with respect to the stock of
2942	2942	16 the same person to whom the interest was paid,
2943	2943	17 accrued, or incurred.
2944	2944	18 This paragraph shall not apply to the following:
2945	2945	19 (i) an item of interest paid, accrued, or
2946	2946	20 incurred, directly or indirectly, to a person who
2947	2947	21 is subject in a foreign country or state, other
2948	2948	22 than a state which requires mandatory unitary
2949	2949	23 reporting, to a tax on or measured by net income
2950	2950	24 with respect to such interest; or
2951	2951	25 (ii) an item of interest paid, accrued, or
2952	2952	26 incurred, directly or indirectly, to a person if
2953	2953
2954	2954
2955	2955
2956	2956
2957	2957
2958	2958	SB1535 - 81 - LRB103 25041 HLH 51375 b
2959	2959
2960	2960
2961	2961	SB1535- 82 -LRB103 25041 HLH 51375 b SB1535 - 82 - LRB103 25041 HLH 51375 b
2962	2962	SB1535 - 82 - LRB103 25041 HLH 51375 b
2963	2963	1 the taxpayer can establish, based on a
2964	2964	2 preponderance of the evidence, both of the
2965	2965	3 following:
2966	2966	4 (a) the person, during the same taxable
2967	2967	5 year, paid, accrued, or incurred, the interest
2968	2968	6 to a person that is not a related member, and
2969	2969	7 (b) the transaction giving rise to the
2970	2970	8 interest expense between the taxpayer and the
2971	2971	9 person did not have as a principal purpose the
2972	2972	10 avoidance of Illinois income tax, and is paid
2973	2973	11 pursuant to a contract or agreement that
2974	2974	12 reflects an arm's-length interest rate and
2975	2975	13 terms; or
2976	2976	14 (iii) the taxpayer can establish, based on
2977	2977	15 clear and convincing evidence, that the interest
2978	2978	16 paid, accrued, or incurred relates to a contract
2979	2979	17 or agreement entered into at arm's-length rates
2980	2980	18 and terms and the principal purpose for the
2981	2981	19 payment is not federal or Illinois tax avoidance;
2982	2982	20 or
2983	2983	21 (iv) an item of interest paid, accrued, or
2984	2984	22 incurred, directly or indirectly, to a person if
2985	2985	23 the taxpayer establishes by clear and convincing
2986	2986	24 evidence that the adjustments are unreasonable; or
2987	2987	25 if the taxpayer and the Director agree in writing
2988	2988	26 to the application or use of an alternative method
2989	2989
2990	2990
2991	2991
2992	2992
2993	2993
2994	2994	SB1535 - 82 - LRB103 25041 HLH 51375 b
2995	2995
2996	2996
2997	2997	SB1535- 83 -LRB103 25041 HLH 51375 b SB1535 - 83 - LRB103 25041 HLH 51375 b
2998	2998	SB1535 - 83 - LRB103 25041 HLH 51375 b
2999	2999	1 of apportionment under Section 304(f).
3000	3000	2 Nothing in this subsection shall preclude the
3001	3001	3 Director from making any other adjustment
3002	3002	4 otherwise allowed under Section 404 of this Act
3003	3003	5 for any tax year beginning after the effective
3004	3004	6 date of this amendment provided such adjustment is
3005	3005	7 made pursuant to regulation adopted by the
3006	3006	8 Department and such regulations provide methods
3007	3007	9 and standards by which the Department will utilize
3008	3008	10 its authority under Section 404 of this Act; and
3009	3009	11 (D-8) An amount equal to the amount of intangible
3010	3010	12 expenses and costs otherwise allowed as a deduction in
3011	3011	13 computing base income, and that were paid, accrued, or
3012	3012	14 incurred, directly or indirectly, (i) for taxable
3013	3013	15 years ending on or after December 31, 2004, to a
3014	3014	16 foreign person who would be a member of the same
3015	3015	17 unitary business group but for the fact that the
3016	3016	18 foreign person's business activity outside the United
3017	3017	19 States is 80% or more of that person's total business
3018	3018	20 activity and (ii) for taxable years ending on or after
3019	3019	21 December 31, 2008, to a person who would be a member of
3020	3020	22 the same unitary business group but for the fact that
3021	3021	23 the person is prohibited under Section 1501(a)(27)
3022	3022	24 from being included in the unitary business group
3023	3023	25 because he or she is ordinarily required to apportion
3024	3024	26 business income under different subsections of Section
3025	3025
3026	3026
3027	3027
3028	3028
3029	3029
3030	3030	SB1535 - 83 - LRB103 25041 HLH 51375 b
3031	3031
3032	3032
3033	3033	SB1535- 84 -LRB103 25041 HLH 51375 b SB1535 - 84 - LRB103 25041 HLH 51375 b
3034	3034	SB1535 - 84 - LRB103 25041 HLH 51375 b
3035	3035	1 304. The addition modification required by this
3036	3036	2 subparagraph shall be reduced to the extent that
3037	3037	3 dividends were included in base income of the unitary
3038	3038	4 group for the same taxable year and received by the
3039	3039	5 taxpayer or by a member of the taxpayer's unitary
3040	3040	6 business group (including amounts included in gross
3041	3041	7 income pursuant to Sections 951 through 964 of the
3042	3042	8 Internal Revenue Code and amounts included in gross
3043	3043	9 income under Section 78 of the Internal Revenue Code)
3044	3044	10 with respect to the stock of the same person to whom
3045	3045	11 the intangible expenses and costs were directly or
3046	3046	12 indirectly paid, incurred or accrued. The preceding
3047	3047	13 sentence shall not apply to the extent that the same
3048	3048	14 dividends caused a reduction to the addition
3049	3049	15 modification required under Section 203(d)(2)(D-7) of
3050	3050	16 this Act. As used in this subparagraph, the term
3051	3051	17 "intangible expenses and costs" includes (1) expenses,
3052	3052	18 losses, and costs for, or related to, the direct or
3053	3053	19 indirect acquisition, use, maintenance or management,
3054	3054	20 ownership, sale, exchange, or any other disposition of
3055	3055	21 intangible property; (2) losses incurred, directly or
3056	3056	22 indirectly, from factoring transactions or discounting
3057	3057	23 transactions; (3) royalty, patent, technical, and
3058	3058	24 copyright fees; (4) licensing fees; and (5) other
3059	3059	25 similar expenses and costs. For purposes of this
3060	3060	26 subparagraph, "intangible property" includes patents,
3061	3061
3062	3062
3063	3063
3064	3064
3065	3065
3066	3066	SB1535 - 84 - LRB103 25041 HLH 51375 b
3067	3067
3068	3068
3069	3069	SB1535- 85 -LRB103 25041 HLH 51375 b SB1535 - 85 - LRB103 25041 HLH 51375 b
3070	3070	SB1535 - 85 - LRB103 25041 HLH 51375 b
3071	3071	1 patent applications, trade names, trademarks, service
3072	3072	2 marks, copyrights, mask works, trade secrets, and
3073	3073	3 similar types of intangible assets;
3074	3074	4 This paragraph shall not apply to the following:
3075	3075	5 (i) any item of intangible expenses or costs
3076	3076	6 paid, accrued, or incurred, directly or
3077	3077	7 indirectly, from a transaction with a person who
3078	3078	8 is subject in a foreign country or state, other
3079	3079	9 than a state which requires mandatory unitary
3080	3080	10 reporting, to a tax on or measured by net income
3081	3081	11 with respect to such item; or
3082	3082	12 (ii) any item of intangible expense or cost
3083	3083	13 paid, accrued, or incurred, directly or
3084	3084	14 indirectly, if the taxpayer can establish, based
3085	3085	15 on a preponderance of the evidence, both of the
3086	3086	16 following:
3087	3087	17 (a) the person during the same taxable
3088	3088	18 year paid, accrued, or incurred, the
3089	3089	19 intangible expense or cost to a person that is
3090	3090	20 not a related member, and
3091	3091	21 (b) the transaction giving rise to the
3092	3092	22 intangible expense or cost between the
3093	3093	23 taxpayer and the person did not have as a
3094	3094	24 principal purpose the avoidance of Illinois
3095	3095	25 income tax, and is paid pursuant to a contract
3096	3096	26 or agreement that reflects arm's-length terms;
3097	3097
3098	3098
3099	3099
3100	3100
3101	3101
3102	3102	SB1535 - 85 - LRB103 25041 HLH 51375 b
3103	3103
3104	3104
3105	3105	SB1535- 86 -LRB103 25041 HLH 51375 b SB1535 - 86 - LRB103 25041 HLH 51375 b
3106	3106	SB1535 - 86 - LRB103 25041 HLH 51375 b
3107	3107	1 or
3108	3108	2 (iii) any item of intangible expense or cost
3109	3109	3 paid, accrued, or incurred, directly or
3110	3110	4 indirectly, from a transaction with a person if
3111	3111	5 the taxpayer establishes by clear and convincing
3112	3112	6 evidence, that the adjustments are unreasonable;
3113	3113	7 or if the taxpayer and the Director agree in
3114	3114	8 writing to the application or use of an
3115	3115	9 alternative method of apportionment under Section
3116	3116	10 304(f);
3117	3117	11 Nothing in this subsection shall preclude the
3118	3118	12 Director from making any other adjustment
3119	3119	13 otherwise allowed under Section 404 of this Act
3120	3120	14 for any tax year beginning after the effective
3121	3121	15 date of this amendment provided such adjustment is
3122	3122	16 made pursuant to regulation adopted by the
3123	3123	17 Department and such regulations provide methods
3124	3124	18 and standards by which the Department will utilize
3125	3125	19 its authority under Section 404 of this Act;
3126	3126	20 (D-9) For taxable years ending on or after
3127	3127	21 December 31, 2008, an amount equal to the amount of
3128	3128	22 insurance premium expenses and costs otherwise allowed
3129	3129	23 as a deduction in computing base income, and that were
3130	3130	24 paid, accrued, or incurred, directly or indirectly, to
3131	3131	25 a person who would be a member of the same unitary
3132	3132	26 business group but for the fact that the person is
3133	3133
3134	3134
3135	3135
3136	3136
3137	3137
3138	3138	SB1535 - 86 - LRB103 25041 HLH 51375 b
3139	3139
3140	3140
3141	3141	SB1535- 87 -LRB103 25041 HLH 51375 b SB1535 - 87 - LRB103 25041 HLH 51375 b
3142	3142	SB1535 - 87 - LRB103 25041 HLH 51375 b
3143	3143	1 prohibited under Section 1501(a)(27) from being
3144	3144	2 included in the unitary business group because he or
3145	3145	3 she is ordinarily required to apportion business
3146	3146	4 income under different subsections of Section 304. The
3147	3147	5 addition modification required by this subparagraph
3148	3148	6 shall be reduced to the extent that dividends were
3149	3149	7 included in base income of the unitary group for the
3150	3150	8 same taxable year and received by the taxpayer or by a
3151	3151	9 member of the taxpayer's unitary business group
3152	3152	10 (including amounts included in gross income under
3153	3153	11 Sections 951 through 964 of the Internal Revenue Code
3154	3154	12 and amounts included in gross income under Section 78
3155	3155	13 of the Internal Revenue Code) with respect to the
3156	3156	14 stock of the same person to whom the premiums and costs
3157	3157	15 were directly or indirectly paid, incurred, or
3158	3158	16 accrued. The preceding sentence does not apply to the
3159	3159	17 extent that the same dividends caused a reduction to
3160	3160	18 the addition modification required under Section
3161	3161	19 203(d)(2)(D-7) or Section 203(d)(2)(D-8) of this Act;
3162	3162	20 (D-10) An amount equal to the credit allowable to
3163	3163	21 the taxpayer under Section 218(a) of this Act,
3164	3164	22 determined without regard to Section 218(c) of this
3165	3165	23 Act;
3166	3166	24 (D-11) For taxable years ending on or after
3167	3167	25 December 31, 2017, an amount equal to the deduction
3168	3168	26 allowed under Section 199 of the Internal Revenue Code
3169	3169
3170	3170
3171	3171
3172	3172
3173	3173
3174	3174	SB1535 - 87 - LRB103 25041 HLH 51375 b
3175	3175
3176	3176
3177	3177	SB1535- 88 -LRB103 25041 HLH 51375 b SB1535 - 88 - LRB103 25041 HLH 51375 b
3178	3178	SB1535 - 88 - LRB103 25041 HLH 51375 b
3179	3179	1 for the taxable year;
3180	3180	2 and by deducting from the total so obtained the following
3181	3181	3 amounts:
3182	3182	4 (E) The valuation limitation amount;
3183	3183	5 (F) An amount equal to the amount of any tax
3184	3184	6 imposed by this Act which was refunded to the taxpayer
3185	3185	7 and included in such total for the taxable year;
3186	3186	8 (G) An amount equal to all amounts included in
3187	3187	9 taxable income as modified by subparagraphs (A), (B),
3188	3188	10 (C) and (D) which are exempt from taxation by this
3189	3189	11 State either by reason of its statutes or Constitution
3190	3190	12 or by reason of the Constitution, treaties or statutes
3191	3191	13 of the United States; provided that, in the case of any
3192	3192	14 statute of this State that exempts income derived from
3193	3193	15 bonds or other obligations from the tax imposed under
3194	3194	16 this Act, the amount exempted shall be the interest
3195	3195	17 net of bond premium amortization;
3196	3196	18 (H) Any income of the partnership which
3197	3197	19 constitutes personal service income as defined in
3198	3198	20 Section 1348(b)(1) of the Internal Revenue Code (as in
3199	3199	21 effect December 31, 1981) or a reasonable allowance
3200	3200	22 for compensation paid or accrued for services rendered
3201	3201	23 by partners to the partnership, whichever is greater;
3202	3202	24 this subparagraph (H) is exempt from the provisions of
3203	3203	25 Section 250;
3204	3204	26 (I) An amount equal to all amounts of income
3205	3205
3206	3206
3207	3207
3208	3208
3209	3209
3210	3210	SB1535 - 88 - LRB103 25041 HLH 51375 b
3211	3211
3212	3212
3213	3213	SB1535- 89 -LRB103 25041 HLH 51375 b SB1535 - 89 - LRB103 25041 HLH 51375 b
3214	3214	SB1535 - 89 - LRB103 25041 HLH 51375 b
3215	3215	1 distributable to an entity subject to the Personal
3216	3216	2 Property Tax Replacement Income Tax imposed by
3217	3217	3 subsections (c) and (d) of Section 201 of this Act
3218	3218	4 including amounts distributable to organizations
3219	3219	5 exempt from federal income tax by reason of Section
3220	3220	6 501(a) of the Internal Revenue Code; this subparagraph
3221	3221	7 (I) is exempt from the provisions of Section 250;
3222	3222	8 (J) With the exception of any amounts subtracted
3223	3223	9 under subparagraph (G), an amount equal to the sum of
3224	3224	10 all amounts disallowed as deductions by (i) Sections
3225	3225	11 171(a)(2) and 265(a)(2) of the Internal Revenue Code,
3226	3226	12 and all amounts of expenses allocable to interest and
3227	3227	13 disallowed as deductions by Section 265(a)(1) of the
3228	3228	14 Internal Revenue Code; and (ii) for taxable years
3229	3229	15 ending on or after August 13, 1999, Sections
3230	3230	16 171(a)(2), 265, 280C, and 832(b)(5)(B)(i) of the
3231	3231	17 Internal Revenue Code, plus, (iii) for taxable years
3232	3232	18 ending on or after December 31, 2011, Section
3233	3233	19 45G(e)(3) of the Internal Revenue Code and, for
3234	3234	20 taxable years ending on or after December 31, 2008,
3235	3235	21 any amount included in gross income under Section 87
3236	3236	22 of the Internal Revenue Code; the provisions of this
3237	3237	23 subparagraph are exempt from the provisions of Section
3238	3238	24 250;
3239	3239	25 (K) An amount equal to those dividends included in
3240	3240	26 such total which were paid by a corporation which
3241	3241
3242	3242
3243	3243
3244	3244
3245	3245
3246	3246	SB1535 - 89 - LRB103 25041 HLH 51375 b
3247	3247
3248	3248
3249	3249	SB1535- 90 -LRB103 25041 HLH 51375 b SB1535 - 90 - LRB103 25041 HLH 51375 b
3250	3250	SB1535 - 90 - LRB103 25041 HLH 51375 b
3251	3251	1 conducts business operations in a River Edge
3252	3252	2 Redevelopment Zone or zones created under the River
3253	3253	3 Edge Redevelopment Zone Act and conducts substantially
3254	3254	4 all of its operations from a River Edge Redevelopment
3255	3255	5 Zone or zones. This subparagraph (K) is exempt from
3256	3256	6 the provisions of Section 250;
3257	3257	7 (L) An amount equal to any contribution made to a
3258	3258	8 job training project established pursuant to the Real
3259	3259	9 Property Tax Increment Allocation Redevelopment Act;
3260	3260	10 (M) An amount equal to those dividends included in
3261	3261	11 such total that were paid by a corporation that
3262	3262	12 conducts business operations in a federally designated
3263	3263	13 Foreign Trade Zone or Sub-Zone and that is designated
3264	3264	14 a High Impact Business located in Illinois; provided
3265	3265	15 that dividends eligible for the deduction provided in
3266	3266	16 subparagraph (K) of paragraph (2) of this subsection
3267	3267	17 shall not be eligible for the deduction provided under
3268	3268	18 this subparagraph (M);
3269	3269	19 (N) An amount equal to the amount of the deduction
3270	3270	20 used to compute the federal income tax credit for
3271	3271	21 restoration of substantial amounts held under claim of
3272	3272	22 right for the taxable year pursuant to Section 1341 of
3273	3273	23 the Internal Revenue Code;
3274	3274	24 (O) For taxable years 2001 and thereafter, for the
3275	3275	25 taxable year in which the bonus depreciation deduction
3276	3276	26 is taken on the taxpayer's federal income tax return
3277	3277
3278	3278
3279	3279
3280	3280
3281	3281
3282	3282	SB1535 - 90 - LRB103 25041 HLH 51375 b
3283	3283
3284	3284
3285	3285	SB1535- 91 -LRB103 25041 HLH 51375 b SB1535 - 91 - LRB103 25041 HLH 51375 b
3286	3286	SB1535 - 91 - LRB103 25041 HLH 51375 b
3287	3287	1 under subsection (k) of Section 168 of the Internal
3288	3288	2 Revenue Code and for each applicable taxable year
3289	3289	3 thereafter, an amount equal to "x", where:
3290	3290	4 (1) "y" equals the amount of the depreciation
3291	3291	5 deduction taken for the taxable year on the
3292	3292	6 taxpayer's federal income tax return on property
3293	3293	7 for which the bonus depreciation deduction was
3294	3294	8 taken in any year under subsection (k) of Section
3295	3295	9 168 of the Internal Revenue Code, but not
3296	3296	10 including the bonus depreciation deduction;
3297	3297	11 (2) for taxable years ending on or before
3298	3298	12 December 31, 2005, "x" equals "y" multiplied by 30
3299	3299	13 and then divided by 70 (or "y" multiplied by
3300	3300	14 0.429); and
3301	3301	15 (3) for taxable years ending after December
3302	3302	16 31, 2005:
3303	3303	17 (i) for property on which a bonus
3304	3304	18 depreciation deduction of 30% of the adjusted
3305	3305	19 basis was taken, "x" equals "y" multiplied by
3306	3306	20 30 and then divided by 70 (or "y" multiplied
3307	3307	21 by 0.429); and
3308	3308	22 (ii) for property on which a bonus
3309	3309	23 depreciation deduction of 50% of the adjusted
3310	3310	24 basis was taken, "x" equals "y" multiplied by
3311	3311	25 1.0;
3312	3312	26 (iii) (blank); for property on which a
3313	3313
3314	3314
3315	3315
3316	3316
3317	3317
3318	3318	SB1535 - 91 - LRB103 25041 HLH 51375 b
3319	3319
3320	3320
3321	3321	SB1535- 92 -LRB103 25041 HLH 51375 b SB1535 - 92 - LRB103 25041 HLH 51375 b
3322	3322	SB1535 - 92 - LRB103 25041 HLH 51375 b
3323	3323	1 bonus depreciation deduction of 100% of the
3324	3324	2 adjusted basis was taken in a taxable year
3325	3325	3 ending on or after December 31, 2021, "x"
3326	3326	4 equals the depreciation deduction that would
3327	3327	5 be allowed on that property if the taxpayer
3328	3328	6 had made the election under Section 168(k)(7)
3329	3329	7 of the Internal Revenue Code to not claim
3330	3330	8 bonus depreciation on that property; and
3331	3331	9 (iv) (blank). for property on which a
3332	3332	10 bonus depreciation deduction of a percentage
3333	3333	11 other than 30%, 50% or 100% of the adjusted
3334	3334	12 basis was taken in a taxable year ending on or
3335	3335	13 after December 31, 2021, "x" equals "y"
3336	3336	14 multiplied by 100 times the percentage bonus
3337	3337	15 depreciation on the property (that is,
3338	3338	16 100(bonus%)) and then divided by 100 times 1
3339	3339	17 minus the percentage bonus depreciation on the
3340	3340	18 property (that is, 100(1bonus%)).
3341	3341	19 The aggregate amount deducted under this
3342	3342	20 subparagraph in all taxable years for any one piece of
3343	3343	21 property may not exceed the amount of the bonus
3344	3344	22 depreciation deduction taken on that property on the
3345	3345	23 taxpayer's federal income tax return under subsection
3346	3346	24 (k) of Section 168 of the Internal Revenue Code. This
3347	3347	25 subparagraph (O) is exempt from the provisions of
3348	3348	26 Section 250;
3349	3349
3350	3350
3351	3351
3352	3352
3353	3353
3354	3354	SB1535 - 92 - LRB103 25041 HLH 51375 b
3355	3355
3356	3356
3357	3357	SB1535- 93 -LRB103 25041 HLH 51375 b SB1535 - 93 - LRB103 25041 HLH 51375 b
3358	3358	SB1535 - 93 - LRB103 25041 HLH 51375 b
3359	3359	1 (P) If the taxpayer sells, transfers, abandons, or
3360	3360	2 otherwise disposes of property for which the taxpayer
3361	3361	3 was required in any taxable year to make an addition
3362	3362	4 modification under subparagraph (D-5), then an amount
3363	3363	5 equal to that addition modification.
3364	3364	6 If the taxpayer continues to own property through
3365	3365	7 the last day of the last tax year for which the
3366	3366	8 taxpayer may claim a depreciation deduction for
3367	3367	9 federal income tax purposes a subtraction is allowed
3368	3368	10 with respect to that property under subparagraph (O)
3369	3369	11 and for which the taxpayer was required in any taxable
3370	3370	12 year to make an addition modification under
3371	3371	13 subparagraph (D-5), then an amount equal to that
3372	3372	14 addition modification.
3373	3373	15 The taxpayer is allowed to take the deduction
3374	3374	16 under this subparagraph only once with respect to any
3375	3375	17 one piece of property.
3376	3376	18 This subparagraph (P) is exempt from the
3377	3377	19 provisions of Section 250;
3378	3378	20 (Q) The amount of (i) any interest income (net of
3379	3379	21 the deductions allocable thereto) taken into account
3380	3380	22 for the taxable year with respect to a transaction
3381	3381	23 with a taxpayer that is required to make an addition
3382	3382	24 modification with respect to such transaction under
3383	3383	25 Section 203(a)(2)(D-17), 203(b)(2)(E-12),
3384	3384	26 203(c)(2)(G-12), or 203(d)(2)(D-7), but not to exceed
3385	3385
3386	3386
3387	3387
3388	3388
3389	3389
3390	3390	SB1535 - 93 - LRB103 25041 HLH 51375 b
3391	3391
3392	3392
3393	3393	SB1535- 94 -LRB103 25041 HLH 51375 b SB1535 - 94 - LRB103 25041 HLH 51375 b
3394	3394	SB1535 - 94 - LRB103 25041 HLH 51375 b
3395	3395	1 the amount of such addition modification and (ii) any
3396	3396	2 income from intangible property (net of the deductions
3397	3397	3 allocable thereto) taken into account for the taxable
3398	3398	4 year with respect to a transaction with a taxpayer
3399	3399	5 that is required to make an addition modification with
3400	3400	6 respect to such transaction under Section
3401	3401	7 203(a)(2)(D-18), 203(b)(2)(E-13), 203(c)(2)(G-13), or
3402	3402	8 203(d)(2)(D-8), but not to exceed the amount of such
3403	3403	9 addition modification. This subparagraph (Q) is exempt
3404	3404	10 from Section 250;
3405	3405	11 (R) An amount equal to the interest income taken
3406	3406	12 into account for the taxable year (net of the
3407	3407	13 deductions allocable thereto) with respect to
3408	3408	14 transactions with (i) a foreign person who would be a
3409	3409	15 member of the taxpayer's unitary business group but
3410	3410	16 for the fact that the foreign person's business
3411	3411	17 activity outside the United States is 80% or more of
3412	3412	18 that person's total business activity and (ii) for
3413	3413	19 taxable years ending on or after December 31, 2008, to
3414	3414	20 a person who would be a member of the same unitary
3415	3415	21 business group but for the fact that the person is
3416	3416	22 prohibited under Section 1501(a)(27) from being
3417	3417	23 included in the unitary business group because he or
3418	3418	24 she is ordinarily required to apportion business
3419	3419	25 income under different subsections of Section 304, but
3420	3420	26 not to exceed the addition modification required to be
3421	3421
3422	3422
3423	3423
3424	3424
3425	3425
3426	3426	SB1535 - 94 - LRB103 25041 HLH 51375 b
3427	3427
3428	3428
3429	3429	SB1535- 95 -LRB103 25041 HLH 51375 b SB1535 - 95 - LRB103 25041 HLH 51375 b
3430	3430	SB1535 - 95 - LRB103 25041 HLH 51375 b
3431	3431	1 made for the same taxable year under Section
3432	3432	2 203(d)(2)(D-7) for interest paid, accrued, or
3433	3433	3 incurred, directly or indirectly, to the same person.
3434	3434	4 This subparagraph (R) is exempt from Section 250;
3435	3435	5 (S) An amount equal to the income from intangible
3436	3436	6 property taken into account for the taxable year (net
3437	3437	7 of the deductions allocable thereto) with respect to
3438	3438	8 transactions with (i) a foreign person who would be a
3439	3439	9 member of the taxpayer's unitary business group but
3440	3440	10 for the fact that the foreign person's business
3441	3441	11 activity outside the United States is 80% or more of
3442	3442	12 that person's total business activity and (ii) for
3443	3443	13 taxable years ending on or after December 31, 2008, to
3444	3444	14 a person who would be a member of the same unitary
3445	3445	15 business group but for the fact that the person is
3446	3446	16 prohibited under Section 1501(a)(27) from being
3447	3447	17 included in the unitary business group because he or
3448	3448	18 she is ordinarily required to apportion business
3449	3449	19 income under different subsections of Section 304, but
3450	3450	20 not to exceed the addition modification required to be
3451	3451	21 made for the same taxable year under Section
3452	3452	22 203(d)(2)(D-8) for intangible expenses and costs paid,
3453	3453	23 accrued, or incurred, directly or indirectly, to the
3454	3454	24 same person. This subparagraph (S) is exempt from
3455	3455	25 Section 250; and
3456	3456	26 (T) For taxable years ending on or after December
3457	3457
3458	3458
3459	3459
3460	3460
3461	3461
3462	3462	SB1535 - 95 - LRB103 25041 HLH 51375 b
3463	3463
3464	3464
3465	3465	SB1535- 96 -LRB103 25041 HLH 51375 b SB1535 - 96 - LRB103 25041 HLH 51375 b
3466	3466	SB1535 - 96 - LRB103 25041 HLH 51375 b
3467	3467	1 31, 2011, in the case of a taxpayer who was required to
3468	3468	2 add back any insurance premiums under Section
3469	3469	3 203(d)(2)(D-9), such taxpayer may elect to subtract
3470	3470	4 that part of a reimbursement received from the
3471	3471	5 insurance company equal to the amount of the expense
3472	3472	6 or loss (including expenses incurred by the insurance
3473	3473	7 company) that would have been taken into account as a
3474	3474	8 deduction for federal income tax purposes if the
3475	3475	9 expense or loss had been uninsured. If a taxpayer
3476	3476	10 makes the election provided for by this subparagraph
3477	3477	11 (T), the insurer to which the premiums were paid must
3478	3478	12 add back to income the amount subtracted by the
3479	3479	13 taxpayer pursuant to this subparagraph (T). This
3480	3480	14 subparagraph (T) is exempt from the provisions of
3481	3481	15 Section 250.
3482	3482	16 (e) Gross income; adjusted gross income; taxable income.
3483	3483	17 (1) In general. Subject to the provisions of paragraph
3484	3484	18 (2) and subsection (b)(3), for purposes of this Section
3485	3485	19 and Section 803(e), a taxpayer's gross income, adjusted
3486	3486	20 gross income, or taxable income for the taxable year shall
3487	3487	21 mean the amount of gross income, adjusted gross income or
3488	3488	22 taxable income properly reportable for federal income tax
3489	3489	23 purposes for the taxable year under the provisions of the
3490	3490	24 Internal Revenue Code. Taxable income may be less than
3491	3491	25 zero. However, for taxable years ending on or after
3492	3492
3493	3493
3494	3494
3495	3495
3496	3496
3497	3497	SB1535 - 96 - LRB103 25041 HLH 51375 b
3498	3498
3499	3499
3500	3500	SB1535- 97 -LRB103 25041 HLH 51375 b SB1535 - 97 - LRB103 25041 HLH 51375 b
3501	3501	SB1535 - 97 - LRB103 25041 HLH 51375 b
3502	3502	1 December 31, 1986, net operating loss carryforwards from
3503	3503	2 taxable years ending prior to December 31, 1986, may not
3504	3504	3 exceed the sum of federal taxable income for the taxable
3505	3505	4 year before net operating loss deduction, plus the excess
3506	3506	5 of addition modifications over subtraction modifications
3507	3507	6 for the taxable year. For taxable years ending prior to
3508	3508	7 December 31, 1986, taxable income may never be an amount
3509	3509	8 in excess of the net operating loss for the taxable year as
3510	3510	9 defined in subsections (c) and (d) of Section 172 of the
3511	3511	10 Internal Revenue Code, provided that when taxable income
3512	3512	11 of a corporation (other than a Subchapter S corporation),
3513	3513	12 trust, or estate is less than zero and addition
3514	3514	13 modifications, other than those provided by subparagraph
3515	3515	14 (E) of paragraph (2) of subsection (b) for corporations or
3516	3516	15 subparagraph (E) of paragraph (2) of subsection (c) for
3517	3517	16 trusts and estates, exceed subtraction modifications, an
3518	3518	17 addition modification must be made under those
3519	3519	18 subparagraphs for any other taxable year to which the
3520	3520	19 taxable income less than zero (net operating loss) is
3521	3521	20 applied under Section 172 of the Internal Revenue Code or
3522	3522	21 under subparagraph (E) of paragraph (2) of this subsection
3523	3523	22 (e) applied in conjunction with Section 172 of the
3524	3524	23 Internal Revenue Code.
3525	3525	24 (2) Special rule. For purposes of paragraph (1) of
3526	3526	25 this subsection, the taxable income properly reportable
3527	3527	26 for federal income tax purposes shall mean:
3528	3528
3529	3529
3530	3530
3531	3531
3532	3532
3533	3533	SB1535 - 97 - LRB103 25041 HLH 51375 b
3534	3534
3535	3535
3536	3536	SB1535- 98 -LRB103 25041 HLH 51375 b SB1535 - 98 - LRB103 25041 HLH 51375 b
3537	3537	SB1535 - 98 - LRB103 25041 HLH 51375 b
3538	3538	1 (A) Certain life insurance companies. In the case
3539	3539	2 of a life insurance company subject to the tax imposed
3540	3540	3 by Section 801 of the Internal Revenue Code, life
3541	3541	4 insurance company taxable income, plus the amount of
3542	3542	5 distribution from pre-1984 policyholder surplus
3543	3543	6 accounts as calculated under Section 815a of the
3544	3544	7 Internal Revenue Code;
3545	3545	8 (B) Certain other insurance companies. In the case
3546	3546	9 of mutual insurance companies subject to the tax
3547	3547	10 imposed by Section 831 of the Internal Revenue Code,
3548	3548	11 insurance company taxable income;
3549	3549	12 (C) Regulated investment companies. In the case of
3550	3550	13 a regulated investment company subject to the tax
3551	3551	14 imposed by Section 852 of the Internal Revenue Code,
3552	3552	15 investment company taxable income;
3553	3553	16 (D) Real estate investment trusts. In the case of
3554	3554	17 a real estate investment trust subject to the tax
3555	3555	18 imposed by Section 857 of the Internal Revenue Code,
3556	3556	19 real estate investment trust taxable income;
3557	3557	20 (E) Consolidated corporations. In the case of a
3558	3558	21 corporation which is a member of an affiliated group
3559	3559	22 of corporations filing a consolidated income tax
3560	3560	23 return for the taxable year for federal income tax
3561	3561	24 purposes, taxable income determined as if such
3562	3562	25 corporation had filed a separate return for federal
3563	3563	26 income tax purposes for the taxable year and each
3564	3564
3565	3565
3566	3566
3567	3567
3568	3568
3569	3569	SB1535 - 98 - LRB103 25041 HLH 51375 b
3570	3570
3571	3571
3572	3572	SB1535- 99 -LRB103 25041 HLH 51375 b SB1535 - 99 - LRB103 25041 HLH 51375 b
3573	3573	SB1535 - 99 - LRB103 25041 HLH 51375 b
3574	3574	1 preceding taxable year for which it was a member of an
3575	3575	2 affiliated group. For purposes of this subparagraph,
3576	3576	3 the taxpayer's separate taxable income shall be
3577	3577	4 determined as if the election provided by Section
3578	3578	5 243(b)(2) of the Internal Revenue Code had been in
3579	3579	6 effect for all such years;
3580	3580	7 (F) Cooperatives. In the case of a cooperative
3581	3581	8 corporation or association, the taxable income of such
3582	3582	9 organization determined in accordance with the
3583	3583	10 provisions of Section 1381 through 1388 of the
3584	3584	11 Internal Revenue Code, but without regard to the
3585	3585	12 prohibition against offsetting losses from patronage
3586	3586	13 activities against income from nonpatronage
3587	3587	14 activities; except that a cooperative corporation or
3588	3588	15 association may make an election to follow its federal
3589	3589	16 income tax treatment of patronage losses and
3590	3590	17 nonpatronage losses. In the event such election is
3591	3591	18 made, such losses shall be computed and carried over
3592	3592	19 in a manner consistent with subsection (a) of Section
3593	3593	20 207 of this Act and apportioned by the apportionment
3594	3594	21 factor reported by the cooperative on its Illinois
3595	3595	22 income tax return filed for the taxable year in which
3596	3596	23 the losses are incurred. The election shall be
3597	3597	24 effective for all taxable years with original returns
3598	3598	25 due on or after the date of the election. In addition,
3599	3599	26 the cooperative may file an amended return or returns,
3600	3600
3601	3601
3602	3602
3603	3603
3604	3604
3605	3605	SB1535 - 99 - LRB103 25041 HLH 51375 b
3606	3606
3607	3607
3608	3608	SB1535- 100 -LRB103 25041 HLH 51375 b SB1535 - 100 - LRB103 25041 HLH 51375 b
3609	3609	SB1535 - 100 - LRB103 25041 HLH 51375 b
3610	3610	1 as allowed under this Act, to provide that the
3611	3611	2 election shall be effective for losses incurred or
3612	3612	3 carried forward for taxable years occurring prior to
3613	3613	4 the date of the election. Once made, the election may
3614	3614	5 only be revoked upon approval of the Director. The
3615	3615	6 Department shall adopt rules setting forth
3616	3616	7 requirements for documenting the elections and any
3617	3617	8 resulting Illinois net loss and the standards to be
3618	3618	9 used by the Director in evaluating requests to revoke
3619	3619	10 elections. Public Act 96-932 is declaratory of
3620	3620	11 existing law;
3621	3621	12 (G) Subchapter S corporations. In the case of: (i)
3622	3622	13 a Subchapter S corporation for which there is in
3623	3623	14 effect an election for the taxable year under Section
3624	3624	15 1362 of the Internal Revenue Code, the taxable income
3625	3625	16 of such corporation determined in accordance with
3626	3626	17 Section 1363(b) of the Internal Revenue Code, except
3627	3627	18 that taxable income shall take into account those
3628	3628	19 items which are required by Section 1363(b)(1) of the
3629	3629	20 Internal Revenue Code to be separately stated; and
3630	3630	21 (ii) a Subchapter S corporation for which there is in
3631	3631	22 effect a federal election to opt out of the provisions
3632	3632	23 of the Subchapter S Revision Act of 1982 and have
3633	3633	24 applied instead the prior federal Subchapter S rules
3634	3634	25 as in effect on July 1, 1982, the taxable income of
3635	3635	26 such corporation determined in accordance with the
3636	3636
3637	3637
3638	3638
3639	3639
3640	3640
3641	3641	SB1535 - 100 - LRB103 25041 HLH 51375 b
3642	3642
3643	3643
3644	3644	SB1535- 101 -LRB103 25041 HLH 51375 b SB1535 - 101 - LRB103 25041 HLH 51375 b
3645	3645	SB1535 - 101 - LRB103 25041 HLH 51375 b
3646	3646	1 federal Subchapter S rules as in effect on July 1,
3647	3647	2 1982; and
3648	3648	3 (H) Partnerships. In the case of a partnership,
3649	3649	4 taxable income determined in accordance with Section
3650	3650	5 703 of the Internal Revenue Code, except that taxable
3651	3651	6 income shall take into account those items which are
3652	3652	7 required by Section 703(a)(1) to be separately stated
3653	3653	8 but which would be taken into account by an individual
3654	3654	9 in calculating his taxable income.
3655	3655	10 (3) Recapture of business expenses on disposition of
3656	3656	11 asset or business. Notwithstanding any other law to the
3657	3657	12 contrary, if in prior years income from an asset or
3658	3658	13 business has been classified as business income and in a
3659	3659	14 later year is demonstrated to be non-business income, then
3660	3660	15 all expenses, without limitation, deducted in such later
3661	3661	16 year and in the 2 immediately preceding taxable years
3662	3662	17 related to that asset or business that generated the
3663	3663	18 non-business income shall be added back and recaptured as
3664	3664	19 business income in the year of the disposition of the
3665	3665	20 asset or business. Such amount shall be apportioned to
3666	3666	21 Illinois using the greater of the apportionment fraction
3667	3667	22 computed for the business under Section 304 of this Act
3668	3668	23 for the taxable year or the average of the apportionment
3669	3669	24 fractions computed for the business under Section 304 of
3670	3670	25 this Act for the taxable year and for the 2 immediately
3671	3671	26 preceding taxable years.
3672	3672
3673	3673
3674	3674
3675	3675
3676	3676
3677	3677	SB1535 - 101 - LRB103 25041 HLH 51375 b
3678	3678
3679	3679
3680	3680	SB1535- 102 -LRB103 25041 HLH 51375 b SB1535 - 102 - LRB103 25041 HLH 51375 b
3681	3681	SB1535 - 102 - LRB103 25041 HLH 51375 b
3682	3682	1 (f) Valuation limitation amount.
3683	3683	2 (1) In general. The valuation limitation amount
3684	3684	3 referred to in subsections (a)(2)(G), (c)(2)(I) and
3685	3685	4 (d)(2)(E) is an amount equal to:
3686	3686	5 (A) The sum of the pre-August 1, 1969 appreciation
3687	3687	6 amounts (to the extent consisting of gain reportable
3688	3688	7 under the provisions of Section 1245 or 1250 of the
3689	3689	8 Internal Revenue Code) for all property in respect of
3690	3690	9 which such gain was reported for the taxable year;
3691	3691	10 plus
3692	3692	11 (B) The lesser of (i) the sum of the pre-August 1,
3693	3693	12 1969 appreciation amounts (to the extent consisting of
3694	3694	13 capital gain) for all property in respect of which
3695	3695	14 such gain was reported for federal income tax purposes
3696	3696	15 for the taxable year, or (ii) the net capital gain for
3697	3697	16 the taxable year, reduced in either case by any amount
3698	3698	17 of such gain included in the amount determined under
3699	3699	18 subsection (a)(2)(F) or (c)(2)(H).
3700	3700	19 (2) Pre-August 1, 1969 appreciation amount.
3701	3701	20 (A) If the fair market value of property referred
3702	3702	21 to in paragraph (1) was readily ascertainable on
3703	3703	22 August 1, 1969, the pre-August 1, 1969 appreciation
3704	3704	23 amount for such property is the lesser of (i) the
3705	3705	24 excess of such fair market value over the taxpayer's
3706	3706	25 basis (for determining gain) for such property on that
3707	3707
3708	3708
3709	3709
3710	3710
3711	3711
3712	3712	SB1535 - 102 - LRB103 25041 HLH 51375 b
3713	3713
3714	3714
3715	3715	SB1535- 103 -LRB103 25041 HLH 51375 b SB1535 - 103 - LRB103 25041 HLH 51375 b
3716	3716	SB1535 - 103 - LRB103 25041 HLH 51375 b
3717	3717	1 date (determined under the Internal Revenue Code as in
3718	3718	2 effect on that date), or (ii) the total gain realized
3719	3719	3 and reportable for federal income tax purposes in
3720	3720	4 respect of the sale, exchange or other disposition of
3721	3721	5 such property.
3722	3722	6 (B) If the fair market value of property referred
3723	3723	7 to in paragraph (1) was not readily ascertainable on
3724	3724	8 August 1, 1969, the pre-August 1, 1969 appreciation
3725	3725	9 amount for such property is that amount which bears
3726	3726	10 the same ratio to the total gain reported in respect of
3727	3727	11 the property for federal income tax purposes for the
3728	3728	12 taxable year, as the number of full calendar months in
3729	3729	13 that part of the taxpayer's holding period for the
3730	3730	14 property ending July 31, 1969 bears to the number of
3731	3731	15 full calendar months in the taxpayer's entire holding
3732	3732	16 period for the property.
3733	3733	17 (C) The Department shall prescribe such
3734	3734	18 regulations as may be necessary to carry out the
3735	3735	19 purposes of this paragraph.
3736	3736	20 (g) Double deductions. Unless specifically provided
3737	3737	21 otherwise, nothing in this Section shall permit the same item
3738	3738	22 to be deducted more than once.
3739	3739	23 (h) Legislative intention. Except as expressly provided by
3740	3740	24 this Section there shall be no modifications or limitations on
3741	3741
3742	3742
3743	3743
3744	3744
3745	3745
3746	3746	SB1535 - 103 - LRB103 25041 HLH 51375 b
3747	3747
3748	3748
3749	3749	SB1535- 104 -LRB103 25041 HLH 51375 b SB1535 - 104 - LRB103 25041 HLH 51375 b
3750	3750	SB1535 - 104 - LRB103 25041 HLH 51375 b
3751	3751	1 the amounts of income, gain, loss or deduction taken into
3752	3752	2 account in determining gross income, adjusted gross income or
3753	3753	3 taxable income for federal income tax purposes for the taxable
3754	3754	4 year, or in the amount of such items entering into the
3755	3755	5 computation of base income and net income under this Act for
3756	3756	6 such taxable year, whether in respect of property values as of
3757	3757	7 August 1, 1969 or otherwise.
3758	3758	8 (Source: P.A. 101-9, eff. 6-5-19; 101-81, eff. 7-12-19;
3759	3759	9 102-16, eff. 6-17-21; 102-558, eff. 8-20-21; 102-658, eff.
3760	3760	10 8-27-21; 102-813, eff. 5-13-22; 102-1112, eff. 12-21-22.)
3761	3761	11 (35 ILCS 5/207) (from Ch. 120, par. 2-207)
3762	3762	12 Sec. 207. Net Losses.
3763	3763	13 (a) If after applying all of the (i) modifications
3764	3764	14 provided for in paragraph (2) of Section 203(b), paragraph (2)
3765	3765	15 of Section 203(c) and paragraph (2) of Section 203(d) and (ii)
3766	3766	16 the allocation and apportionment provisions of Article 3 of
3767	3767	17 this Act and subsection (c) of this Section, the taxpayer's
3768	3768	18 net income results in a loss;
3769	3769	19 (1) for any taxable year ending prior to December 31,
3770	3770	20 1999, such loss shall be allowed as a carryover or
3771	3771	21 carryback deduction in the manner allowed under Section
3772	3772	22 172 of the Internal Revenue Code;
3773	3773	23 (2) for any taxable year ending on or after December
3774	3774	24 31, 1999 and prior to December 31, 2003, such loss shall be
3775	3775	25 allowed as a carryback to each of the 2 taxable years
3776	3776
3777	3777
3778	3778
3779	3779
3780	3780
3781	3781	SB1535 - 104 - LRB103 25041 HLH 51375 b
3782	3782
3783	3783
3784	3784	SB1535- 105 -LRB103 25041 HLH 51375 b SB1535 - 105 - LRB103 25041 HLH 51375 b
3785	3785	SB1535 - 105 - LRB103 25041 HLH 51375 b
3786	3786	1 preceding the taxable year of such loss and shall be a net
3787	3787	2 operating loss carryover to each of the 20 taxable years
3788	3788	3 following the taxable year of such loss;
3789	3789	4 (3) for any taxable year ending on or after December
3790	3790	5 31, 2003 and prior to December 31, 2021, such loss shall be
3791	3791	6 allowed as a net operating loss carryover to each of the 12
3792	3792	7 taxable years following the taxable year of such loss,
3793	3793	8 except as provided in subsection (d); and
3794	3794	9 (4) for any taxable year ending on or after December
3795	3795	10 31, 2021, and for any net loss incurred in a taxable year
3796	3796	11 prior to a taxable year ending on or after December 31,
3797	3797	12 2021 for which the statute of limitation for utilization
3798	3798	13 of such net loss has not expired, such loss shall be
3799	3799	14 allowed as a net operating loss carryover to each of the 20
3800	3800	15 taxable years following the taxable year of such loss,
3801	3801	16 except as provided in subsection (d).
3802	3802	17 (a-5) Election to relinquish carryback and order of
3803	3803	18 application of losses.
3804	3804	19 (A) For losses incurred in tax years ending prior
3805	3805	20 to December 31, 2003, the taxpayer may elect to
3806	3806	21 relinquish the entire carryback period with respect to
3807	3807	22 such loss. Such election shall be made in the form and
3808	3808	23 manner prescribed by the Department and shall be made
3809	3809	24 by the due date (including extensions of time) for
3810	3810	25 filing the taxpayer's return for the taxable year in
3811	3811	26 which such loss is incurred, and such election, once
3812	3812
3813	3813
3814	3814
3815	3815
3816	3816
3817	3817	SB1535 - 105 - LRB103 25041 HLH 51375 b
3818	3818
3819	3819
3820	3820	SB1535- 106 -LRB103 25041 HLH 51375 b SB1535 - 106 - LRB103 25041 HLH 51375 b
3821	3821	SB1535 - 106 - LRB103 25041 HLH 51375 b
3822	3822	1 made, shall be irrevocable.
3823	3823	2 (B) The entire amount of such loss shall be
3824	3824	3 carried to the earliest taxable year to which such
3825	3825	4 loss may be carried. The amount of such loss which
3826	3826	5 shall be carried to each of the other taxable years
3827	3827	6 shall be the excess, if any, of the amount of such loss
3828	3828	7 over the sum of the deductions for carryback or
3829	3829	8 carryover of such loss allowable for each of the prior
3830	3830	9 taxable years to which such loss may be carried.
3831	3831	10 (b) Any loss determined under subsection (a) of this
3832	3832	11 Section must be carried back or carried forward in the same
3833	3833	12 manner for purposes of subsections (a) and (b) of Section 201
3834	3834	13 of this Act as for purposes of subsections (c) and (d) of
3835	3835	14 Section 201 of this Act.
3836	3836	15 (c) Notwithstanding any other provision of this Act, for
3837	3837	16 each taxable year ending on or after December 31, 2008, for
3838	3838	17 purposes of computing the loss for the taxable year under
3839	3839	18 subsection (a) of this Section and the deduction taken into
3840	3840	19 account for the taxable year for a net operating loss
3841	3841	20 carryover under paragraphs (1), (2), and (3) of subsection (a)
3842	3842	21 of this Section, the loss and net operating loss carryover
3843	3843	22 shall be reduced in an amount equal to the reduction to the net
3844	3844	23 operating loss and net operating loss carryover to the taxable
3845	3845	24 year, respectively, required under Section 108(b)(2)(A) of the
3846	3846	25 Internal Revenue Code, multiplied by a fraction, the numerator
3847	3847	26 of which is the amount of discharge of indebtedness income
3848	3848
3849	3849
3850	3850
3851	3851
3852	3852
3853	3853	SB1535 - 106 - LRB103 25041 HLH 51375 b
3854	3854
3855	3855
3856	3856	SB1535- 107 -LRB103 25041 HLH 51375 b SB1535 - 107 - LRB103 25041 HLH 51375 b
3857	3857	SB1535 - 107 - LRB103 25041 HLH 51375 b
3858	3858	1 that is excluded from gross income for the taxable year (but
3859	3859	2 only if the taxable year ends on or after December 31, 2008)
3860	3860	3 under Section 108(a) of the Internal Revenue Code and that
3861	3861	4 would have been allocated and apportioned to this State under
3862	3862	5 Article 3 of this Act but for that exclusion, and the
3863	3863	6 denominator of which is the total amount of discharge of
3864	3864	7 indebtedness income excluded from gross income under Section
3865	3865	8 108(a) of the Internal Revenue Code for the taxable year. The
3866	3866	9 reduction required under this subsection (c) shall be made
3867	3867	10 after the determination of Illinois net income for the taxable
3868	3868	11 year in which the indebtedness is discharged.
3869	3869	12 (d) In the case of a corporation (other than a Subchapter S
3870	3870	13 corporation), no carryover deduction shall be allowed under
3871	3871	14 this Section for any taxable year ending after December 31,
3872	3872	15 2010 and prior to December 31, 2012, and no carryover
3873	3873	16 deduction shall exceed $100,000 for any taxable year ending on
3874	3874	17 or after December 31, 2012 and prior to December 31, 2014 and
3875	3875	18 for any taxable year ending on or after December 31, 2021 and
3876	3876	19 prior to December 31, 2023 December 31, 2024; provided that,
3877	3877	20 for purposes of determining the taxable years to which a net
3878	3878	21 loss may be carried under subsection (a) of this Section, no
3879	3879	22 taxable year for which a deduction is disallowed under this
3880	3880	23 subsection, or for which the deduction would exceed $100,000
3881	3881	24 if not for this subsection, shall be counted.
3882	3882	25 (e) In the case of a residual interest holder in a real
3883	3883	26 estate mortgage investment conduit subject to Section 860E of
3884	3884
3885	3885
3886	3886
3887	3887
3888	3888
3889	3889	SB1535 - 107 - LRB103 25041 HLH 51375 b
3890	3890
3891	3891
3892	3892	SB1535- 108 -LRB103 25041 HLH 51375 b SB1535 - 108 - LRB103 25041 HLH 51375 b
3893	3893	SB1535 - 108 - LRB103 25041 HLH 51375 b
3894	3894	1 the Internal Revenue Code, the net loss in subsection (a)
3895	3895	2 shall be equal to:
3896	3896	3 (1) the amount computed under subsection (a), without
3897	3897	4 regard to this subsection (e), or if that amount is
3898	3898	5 positive, zero;
3899	3899	6 (2) minus an amount equal to the amount computed under
3900	3900	7 subsection (a), without regard to this subsection (e),
3901	3901	8 minus the amount that would be computed under subsection
3902	3902	9 (a) if the taxpayer's federal taxable income were computed
3903	3903	10 without regard to Section 860E of the Internal Revenue
3904	3904	11 Code and without regard to this subsection (e).
3905	3905	12 The modification in this subsection (e) is exempt from the
3906	3906	13 provisions of Section 250.
3907	3907	14 (Source: P.A. 102-16, eff. 6-17-21; 102-669, eff. 11-16-21.)
3908	3908	15 Section 10. The Illinois Estate and Generation-Skipping
3909	3909	16 Transfer Tax Act is amended by changing Sections 2, 3, and 4 as
3910	3910	17 follows:
3911	3911	18 (35 ILCS 405/2) (from Ch. 120, par. 405A-2)
3912	3912	19 Sec. 2. Definitions.
3913	3913	20 "Federal estate tax" means the tax due to the United
3914	3914	21 States with respect to a taxable transfer under Chapter 11 of
3915	3915	22 the Internal Revenue Code.
3916	3916	23 "Federal generation-skipping transfer tax" means the tax
3917	3917	24 due to the United States with respect to a taxable transfer
3918	3918
3919	3919
3920	3920
3921	3921
3922	3922
3923	3923	SB1535 - 108 - LRB103 25041 HLH 51375 b
3924	3924
3925	3925
3926	3926	SB1535- 109 -LRB103 25041 HLH 51375 b SB1535 - 109 - LRB103 25041 HLH 51375 b
3927	3927	SB1535 - 109 - LRB103 25041 HLH 51375 b
3928	3928	1 under Chapter 13 of the Internal Revenue Code.
3929	3929	2 "Federal return" means the federal estate tax return with
3930	3930	3 respect to the federal estate tax and means the federal
3931	3931	4 generation-skipping transfer tax return with respect to the
3932	3932	5 federal generation-skipping transfer tax.
3933	3933	6 "Federal transfer tax" means the federal estate tax or the
3934	3934	7 federal generation-skipping transfer tax.
3935	3935	8 "Illinois estate tax" means the tax due to this State with
3936	3936	9 respect to a taxable transfer.
3937	3937	10 "Illinois generation-skipping transfer tax" means the tax
3938	3938	11 due to this State with respect to a taxable transfer that gives
3939	3939	12 rise to a federal generation-skipping transfer tax.
3940	3940	13 "Illinois transfer tax" means the Illinois estate tax or
3941	3941	14 the Illinois generation-skipping transfer tax.
3942	3942	15 "Internal Revenue Code" means, unless otherwise provided,
3943	3943	16 the Internal Revenue Code of 1986, as amended from time to
3944	3944	17 time.
3945	3945	18 "Non-resident trust" means a trust that is not a resident
3946	3946	19 of this State for purposes of the Illinois Income Tax Act, as
3947	3947	20 amended from time to time.
3948	3948	21 "Person" means and includes any individual, trust, estate,
3949	3949	22 partnership, association, company or corporation.
3950	3950	23 "Qualified heir" means a qualified heir as defined in
3951	3951	24 Section 2032A(e)(1) of the Internal Revenue Code.
3952	3952	25 "Resident trust" means a trust that is a resident of this
3953	3953	26 State for purposes of the Illinois Income Tax Act, as amended
3954	3954
3955	3955
3956	3956
3957	3957
3958	3958
3959	3959	SB1535 - 109 - LRB103 25041 HLH 51375 b
3960	3960
3961	3961
3962	3962	SB1535- 110 -LRB103 25041 HLH 51375 b SB1535 - 110 - LRB103 25041 HLH 51375 b
3963	3963	SB1535 - 110 - LRB103 25041 HLH 51375 b
3964	3964	1 from time to time.
3965	3965	2 "State" means any state, territory or possession of the
3966	3966	3 United States and the District of Columbia.
3967	3967	4 "State tax credit" means:
3968	3968	5 (a) For persons dying on or after January 1, 2003 and
3969	3969	6 through December 31, 2005, an amount equal to the full credit
3970	3970	7 calculable under Section 2011 or Section 2604 of the Internal
3971	3971	8 Revenue Code as the credit would have been computed and
3972	3972	9 allowed under the Internal Revenue Code as in effect on
3973	3973	10 December 31, 2001, without the reduction in the State Death
3974	3974	11 Tax Credit as provided in Section 2011(b)(2) or the
3975	3975	12 termination of the State Death Tax Credit as provided in
3976	3976	13 Section 2011(f) as enacted by the Economic Growth and Tax
3977	3977	14 Relief Reconciliation Act of 2001, but recognizing the
3978	3978	15 increased applicable exclusion amount through December 31,
3979	3979	16 2005.
3980	3980	17 (b) For persons dying after December 31, 2005 and on or
3981	3981	18 before December 31, 2009, and for persons dying after December
3982	3982	19 31, 2010 and prior to the effective date of this amendatory Act
3983	3983	20 of the 103rd General Assembly, an amount equal to the full
3984	3984	21 credit calculable under Section 2011 or 2604 of the Internal
3985	3985	22 Revenue Code as the credit would have been computed and
3986	3986	23 allowed under the Internal Revenue Code as in effect on
3987	3987	24 December 31, 2001, without the reduction in the State Death
3988	3988	25 Tax Credit as provided in Section 2011(b)(2) or the
3989	3989	26 termination of the State Death Tax Credit as provided in
3990	3990
3991	3991
3992	3992
3993	3993
3994	3994
3995	3995	SB1535 - 110 - LRB103 25041 HLH 51375 b
3996	3996
3997	3997
3998	3998	SB1535- 111 -LRB103 25041 HLH 51375 b SB1535 - 111 - LRB103 25041 HLH 51375 b
3999	3999	SB1535 - 111 - LRB103 25041 HLH 51375 b
4000	4000	1 Section 2011(f) as enacted by the Economic Growth and Tax
4001	4001	2 Relief Reconciliation Act of 2001, but recognizing the
4002	4002	3 exclusion amount of only (i) $2,000,000 for persons dying
4003	4003	4 prior to January 1, 2012, (ii) $3,500,000 for persons dying on
4004	4004	5 or after January 1, 2012 and prior to January 1, 2013, and
4005	4005	6 (iii) $4,000,000 for persons dying on or after January 1,
4006	4006	7 2013, and with reduction to the adjusted taxable estate for
4007	4007	8 any qualified terminable interest property election as defined
4008	4008	9 in subsection (b-1) of this Section.
4009	4009	10 (b-1) The person required to file the Illinois return may
4010	4010	11 elect on a timely filed Illinois return a marital deduction
4011	4011	12 for qualified terminable interest property under Section
4012	4012	13 2056(b)(7) of the Internal Revenue Code for purposes of the
4013	4013	14 Illinois estate tax that is separate and independent of any
4014	4014	15 qualified terminable interest property election for federal
4015	4015	16 estate tax purposes. For purposes of the Illinois estate tax,
4016	4016	17 the inclusion of property in the gross estate of a surviving
4017	4017	18 spouse is the same as under Section 2044 of the Internal
4018	4018	19 Revenue Code.
4019	4019	20 In the case of any trust for which a State or federal
4020	4020	21 qualified terminable interest property election is made, the
4021	4021	22 trustee may not retain non-income producing assets for more
4022	4022	23 than a reasonable amount of time without the consent of the
4023	4023	24 surviving spouse.
4024	4024	25 "Taxable transfer" means an event that gives rise to a
4025	4025	26 state tax credit, including any credit as a result of the
4026	4026
4027	4027
4028	4028
4029	4029
4030	4030
4031	4031	SB1535 - 111 - LRB103 25041 HLH 51375 b
4032	4032
4033	4033
4034	4034	SB1535- 112 -LRB103 25041 HLH 51375 b SB1535 - 112 - LRB103 25041 HLH 51375 b
4035	4035	SB1535 - 112 - LRB103 25041 HLH 51375 b
4036	4036	1 imposition of an additional tax under Section 2032A(c) of the
4037	4037	2 Internal Revenue Code.
4038	4038	3 "Transferee" means a transferee within the meaning of
4039	4039	4 Section 2603(a)(1) and Section 6901(h) of the Internal Revenue
4040	4040	5 Code.
4041	4041	6 "Transferred property" means:
4042	4042	7 (1) With respect to a taxable transfer occurring at
4043	4043	8 the death of an individual, the deceased individual's
4044	4044	9 gross estate as defined in Section 2031 of the Internal
4045	4045	10 Revenue Code.
4046	4046	11 (2) With respect to a taxable transfer occurring as a
4047	4047	12 result of a taxable termination as defined in Section
4048	4048	13 2612(a) of the Internal Revenue Code, the taxable amount
4049	4049	14 determined under Section 2622(a) of the Internal Revenue
4050	4050	15 Code.
4051	4051	16 (3) With respect to a taxable transfer occurring as a
4052	4052	17 result of a taxable distribution as defined in Section
4053	4053	18 2612(b) of the Internal Revenue Code, the taxable amount
4054	4054	19 determined under Section 2621(a) of the Internal Revenue
4055	4055	20 Code.
4056	4056	21 (4) With respect to an event which causes the
4057	4057	22 imposition of an additional estate tax under Section
4058	4058	23 2032A(c) of the Internal Revenue Code, the qualified real
4059	4059	24 property that was disposed of or which ceased to be used
4060	4060	25 for the qualified use, within the meaning of Section
4061	4061	26 2032A(c)(1) of the Internal Revenue Code.
4062	4062
4063	4063
4064	4064
4065	4065
4066	4066
4067	4067	SB1535 - 112 - LRB103 25041 HLH 51375 b
4068	4068
4069	4069
4070	4070	SB1535- 113 -LRB103 25041 HLH 51375 b SB1535 - 113 - LRB103 25041 HLH 51375 b
4071	4071	SB1535 - 113 - LRB103 25041 HLH 51375 b
4072	4072	1 "Trust" includes a trust as defined in Section 2652(b)(1)
4073	4073	2 of the Internal Revenue Code.
4074	4074	3 (Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11;
4075	4075	4 97-636, eff. 6-1-12.)
4076	4076	5 (35 ILCS 405/3) (from Ch. 120, par. 405A-3)
4077	4077	6 Sec. 3. Illinois estate tax.
4078	4078	7 (a) Imposition of Tax. An Illinois estate tax is imposed
4079	4079	8 on every taxable transfer involving transferred property
4080	4080	9 having a tax situs within the State of Illinois.
4081	4081	10 (b) Amount of tax. On estates of persons dying before
4082	4082	11 January 1, 2003, the amount of the Illinois estate tax shall be
4083	4083	12 the state tax credit, as defined in Section 2 of this Act, with
4084	4084	13 respect to the taxable transfer reduced by the lesser of:
4085	4085	14 (1) the amount of the state tax credit paid to any
4086	4086	15 other state or states; and
4087	4087	16 (2) the amount determined by multiplying the maximum
4088	4088	17 state tax credit allowable with respect to the taxable
4089	4089	18 transfer by the percentage which the gross value of the
4090	4090	19 transferred property not having a tax situs in Illinois
4091	4091	20 bears to the gross value of the total transferred
4092	4092	21 property.
4093	4093	22 (c) On estates of persons dying on or after January 1, 2003
4094	4094	23 and prior to the effective date of this amendatory Act of the
4095	4095	24 103rd General Assembly, the amount of the Illinois estate tax
4096	4096	25 shall be the state tax credit, as defined in Section 2 of this
4097	4097
4098	4098
4099	4099
4100	4100
4101	4101
4102	4102	SB1535 - 113 - LRB103 25041 HLH 51375 b
4103	4103
4104	4104
4105	4105	SB1535- 114 -LRB103 25041 HLH 51375 b SB1535 - 114 - LRB103 25041 HLH 51375 b
4106	4106	SB1535 - 114 - LRB103 25041 HLH 51375 b
4107	4107	1 Act, reduced by the amount determined by multiplying the state
4108	4108	2 tax credit with respect to the taxable transfer by the
4109	4109	3 percentage which the gross value of the transferred property
4110	4110	4 not having a tax situs in Illinois bears to the gross value of
4111	4111	5 the total transferred property.
4112	4112	6 (d) No tax shall be imposed under this Act for persons
4113	4113	7 dying on or after the effective date of this amendatory Act of
4114	4114	8 the 103rd General Assembly.
4115	4115	9 (Source: P.A. 93-30, eff. 6-20-03; 94-419, eff. 8-2-05.)
4116	4116	10 (35 ILCS 405/4) (from Ch. 120, par. 405A-4)
4117	4117	11 Sec. 4. Illinois generation-skipping transfer tax.
4118	4118	12 (a) Imposition of tax. An Illinois generation-skipping
4119	4119	13 transfer tax is imposed on every taxable transfer resulting in
4120	4120	14 federal generation-skipping transfer tax involving transferred
4121	4121	15 property having a tax situs within the State of Illinois.
4122	4122	16 (b) Amount of tax. The amount of the Illinois
4123	4123	17 generation-skipping transfer tax shall be the maximum state
4124	4124	18 tax credit allowable with respect to the taxable transfer,
4125	4125	19 reduced by the lesser of:
4126	4126	20 (1) the amount of the state tax credit paid to any
4127	4127	21 other state or states; and
4128	4128	22 (2) the amount determined by multiplying the maximum
4129	4129	23 state tax credit allowable with respect to the taxable
4130	4130	24 transfer by the percentage which the gross value of the
4131	4131	25 transferred property not having a tax situs in Illinois
4132	4132
4133	4133
4134	4134
4135	4135
4136	4136
4137	4137	SB1535 - 114 - LRB103 25041 HLH 51375 b
4138	4138
4139	4139
4140	4140	SB1535- 115 -LRB103 25041 HLH 51375 b SB1535 - 115 - LRB103 25041 HLH 51375 b
4141	4141	SB1535 - 115 - LRB103 25041 HLH 51375 b
4142	4142	1 bears to the gross value of the total transferred
4143	4143	2 property.
4144	4144	3 (c) No tax shall be imposed under this Act for transfers
4145	4145	4 occurring on or after the effective date of this amendatory
4146	4146	5 Act of the 103rd General Assembly.
4147	4147	6 (Source: P.A. 86-737.)
4148	4148	7 Section 15. The Business Corporation Act of 1983 is
4149	4149	8 amended by changing Sections 15.35 and 15.65 as follows:
4150	4150	9 (805 ILCS 5/15.35) (from Ch. 32, par. 15.35)
4151	4151	10 (Text of Section from P.A. 102-16)
4152	4152	11 Sec. 15.35. Franchise taxes payable by domestic
4153	4153	12 corporations. For the privilege of exercising its franchises
4154	4154	13 in this State, each domestic corporation shall pay to the
4155	4155	14 Secretary of State the following franchise taxes, computed on
4156	4156	15 the basis, at the rates and for the periods prescribed in this
4157	4157	16 Act:
4158	4158	17 (a) An initial franchise tax at the time of filing its
4159	4159	18 first report of issuance of shares.
4160	4160	19 (b) An additional franchise tax at the time of filing
4161	4161	20 (1) a report of the issuance of additional shares, or (2) a
4162	4162	21 report of an increase in paid-in capital without the
4163	4163	22 issuance of shares, or (3) an amendment to the articles of
4164	4164	23 incorporation or a report of cumulative changes in paid-in
4165	4165	24 capital, whenever any amendment or such report discloses
4166	4166
4167	4167
4168	4168
4169	4169
4170	4170
4171	4171	SB1535 - 115 - LRB103 25041 HLH 51375 b
4172	4172
4173	4173
4174	4174	SB1535- 116 -LRB103 25041 HLH 51375 b SB1535 - 116 - LRB103 25041 HLH 51375 b
4175	4175	SB1535 - 116 - LRB103 25041 HLH 51375 b
4176	4176	1 an increase in its paid-in capital over the amount thereof
4177	4177	2 last reported in any document, other than an annual
4178	4178	3 report, interim annual report or final transition annual
4179	4179	4 report required by this Act to be filed in the office of
4180	4180	5 the Secretary of State.
4181	4181	6 (c) An additional franchise tax at the time of filing
4182	4182	7 a report of paid-in capital following a statutory merger
4183	4183	8 or consolidation, which discloses that the paid-in capital
4184	4184	9 of the surviving or new corporation immediately after the
4185	4185	10 merger or consolidation is greater than the sum of the
4186	4186	11 paid-in capital of all of the merged or consolidated
4187	4187	12 corporations as last reported by them in any documents,
4188	4188	13 other than annual reports, required by this Act to be
4189	4189	14 filed in the office of the Secretary of State; and in
4190	4190	15 addition, the surviving or new corporation shall be liable
4191	4191	16 for a further additional franchise tax on the paid-in
4192	4192	17 capital of each of the merged or consolidated corporations
4193	4193	18 as last reported by them in any document, other than an
4194	4194	19 annual report, required by this Act to be filed with the
4195	4195	20 Secretary of State from their taxable year end to the next
4196	4196	21 succeeding anniversary month or, in the case of a
4197	4197	22 corporation which has established an extended filing
4198	4198	23 month, the extended filing month of the surviving or new
4199	4199	24 corporation; however if the taxable year ends within the
4200	4200	25 2-month period immediately preceding the anniversary month
4201	4201	26 or, in the case of a corporation which has established an
4202	4202
4203	4203
4204	4204
4205	4205
4206	4206
4207	4207	SB1535 - 116 - LRB103 25041 HLH 51375 b
4208	4208
4209	4209
4210	4210	SB1535- 117 -LRB103 25041 HLH 51375 b SB1535 - 117 - LRB103 25041 HLH 51375 b
4211	4211	SB1535 - 117 - LRB103 25041 HLH 51375 b
4212	4212	1 extended filing month, the extended filing month of the
4213	4213	2 surviving or new corporation the tax will be computed to
4214	4214	3 the anniversary month or, in the case of a corporation
4215	4215	4 which has established an extended filing month, the
4216	4216	5 extended filing month of the surviving or new corporation
4217	4217	6 in the next succeeding calendar year.
4218	4218	7 (d) An annual franchise tax payable each year with the
4219	4219	8 annual report which the corporation is required by this
4220	4220	9 Act to file.
4221	4221	10 On or after January 1, 2020 and prior to January 1, 2021,
4222	4222	11 the first $30 in liability is exempt from the tax imposed under
4223	4223	12 this Section. On or after January 1, 2021 and prior to January
4224	4224	13 1, 2022, the first $1,000 in liability is exempt from the tax
4225	4225	14 imposed under this Section. On and after January 1, 2022 and
4226	4226	15 prior to January 1, 2023, the first $10,000 in liability is
4227	4227	16 exempt from the tax imposed under this Section. On and after
4228	4228	17 January 1, 2023 and prior to January 1, 2024, the first
4229	4229	18 $100,000 in liability is exempt from the tax imposed under
4230	4230	19 this Section. The provisions of this Section shall not require
4231	4231	20 the payment of any franchise tax that would otherwise have
4232	4232	21 been due and payable on or after January 1, 2024. There shall
4233	4233	22 be no refunds or proration of franchise tax for any taxes due
4234	4234	23 and payable on or after January 1, 2024 on the basis that a
4235	4235	24 portion of the corporation's taxable year extends beyond
4236	4236	25 January 1, 2024. Public Act 101-9 shall not affect any right
4237	4237	26 accrued or established, or any liability or penalty incurred
4238	4238
4239	4239
4240	4240
4241	4241
4242	4242
4243	4243	SB1535 - 117 - LRB103 25041 HLH 51375 b
4244	4244
4245	4245
4246	4246	SB1535- 118 -LRB103 25041 HLH 51375 b SB1535 - 118 - LRB103 25041 HLH 51375 b
4247	4247	SB1535 - 118 - LRB103 25041 HLH 51375 b
4248	4248	1 prior to January 1, 2024.
4249	4249	2 This Section is repealed on December 31, 2024.
4250	4250	3 (Source: P.A. 101-9, eff. 6-5-19; 102-16, eff. 6-17-21.)
4251	4251	4 (Text of Section from P.A. 102-282)
4252	4252	5 Sec. 15.35. Franchise taxes payable by domestic
4253	4253	6 corporations. For the privilege of exercising its franchises
4254	4254	7 in this State, each domestic corporation shall pay to the
4255	4255	8 Secretary of State the following franchise taxes, computed on
4256	4256	9 the basis, at the rates and for the periods prescribed in this
4257	4257	10 Act:
4258	4258	11 (a) An initial franchise tax at the time of filing its
4259	4259	12 first report of issuance of shares.
4260	4260	13 (b) An additional franchise tax at the time of filing
4261	4261	14 (1) a report of the issuance of additional shares, or (2) a
4262	4262	15 report of an increase in paid-in capital without the
4263	4263	16 issuance of shares, or (3) an amendment to the articles of
4264	4264	17 incorporation or a report of cumulative changes in paid-in
4265	4265	18 capital, whenever any amendment or such report discloses
4266	4266	19 an increase in its paid-in capital over the amount thereof
4267	4267	20 last reported in any document, other than an annual
4268	4268	21 report, interim annual report or final transition annual
4269	4269	22 report required by this Act to be filed in the office of
4270	4270	23 the Secretary of State.
4271	4271	24 (c) An additional franchise tax at the time of filing
4272	4272	25 a report of paid-in capital following a statutory merger
4273	4273
4274	4274
4275	4275
4276	4276
4277	4277
4278	4278	SB1535 - 118 - LRB103 25041 HLH 51375 b
4279	4279
4280	4280
4281	4281	SB1535- 119 -LRB103 25041 HLH 51375 b SB1535 - 119 - LRB103 25041 HLH 51375 b
4282	4282	SB1535 - 119 - LRB103 25041 HLH 51375 b
4283	4283	1 or consolidation, which discloses that the paid-in capital
4284	4284	2 of the surviving or new corporation immediately after the
4285	4285	3 merger or consolidation is greater than the sum of the
4286	4286	4 paid-in capital of all of the merged or consolidated
4287	4287	5 corporations as last reported by them in any documents,
4288	4288	6 other than annual reports, required by this Act to be
4289	4289	7 filed in the office of the Secretary of State; and in
4290	4290	8 addition, the surviving or new corporation shall be liable
4291	4291	9 for a further additional franchise tax on the paid-in
4292	4292	10 capital of each of the merged or consolidated corporations
4293	4293	11 as last reported by them in any document, other than an
4294	4294	12 annual report, required by this Act to be filed with the
4295	4295	13 Secretary of State from their taxable year end to the next
4296	4296	14 succeeding anniversary month or, in the case of a
4297	4297	15 corporation which has established an extended filing
4298	4298	16 month, the extended filing month of the surviving or new
4299	4299	17 corporation; however if the taxable year ends within the
4300	4300	18 2-month period immediately preceding the anniversary month
4301	4301	19 or, in the case of a corporation which has established an
4302	4302	20 extended filing month, the extended filing month of the
4303	4303	21 surviving or new corporation the tax will be computed to
4304	4304	22 the anniversary month or, in the case of a corporation
4305	4305	23 which has established an extended filing month, the
4306	4306	24 extended filing month of the surviving or new corporation
4307	4307	25 in the next succeeding calendar year.
4308	4308	26 (d) An annual franchise tax payable each year with the
4309	4309
4310	4310
4311	4311
4312	4312
4313	4313
4314	4314	SB1535 - 119 - LRB103 25041 HLH 51375 b
4315	4315
4316	4316
4317	4317	SB1535- 120 -LRB103 25041 HLH 51375 b SB1535 - 120 - LRB103 25041 HLH 51375 b
4318	4318	SB1535 - 120 - LRB103 25041 HLH 51375 b
4319	4319	1 annual report which the corporation is required by this
4320	4320	2 Act to file.
4321	4321	3 On or after January 1, 2020 and prior to January 1, 2021,
4322	4322	4 the first $30 in liability is exempt from the tax imposed under
4323	4323	5 this Section. On or after January 1, 2021 and prior to January
4324	4324	6 1, 2022, the first $1,000 in liability is exempt from the tax
4325	4325	7 imposed under this Section. On or after January 1, 2022 and
4326	4326	8 prior to January 1, 2023, the first $10,000 in liability is
4327	4327	9 exempt from the tax imposed under this Section. On or after
4328	4328	10 January 1, 2023 and prior to January 1, 2024, the first
4329	4329	11 $100,000 in liability is exempt from the tax imposed under
4330	4330	12 this Section. The provisions of this Section shall not require
4331	4331	13 the payment of any franchise tax that would otherwise have
4332	4332	14 been due and payable on or after January 1, 2024. There shall
4333	4333	15 be no refunds or proration of franchise tax for any taxes due
4334	4334	16 and payable on or after January 1, 2024 on the basis that a
4335	4335	17 portion of the corporation's taxable year extends beyond
4336	4336	18 January 1, 2024. Public Act 101-9 shall not affect any right
4337	4337	19 accrued or established, or any liability or penalty incurred
4338	4338	20 prior to January 1, 2024.
4339	4339	21 This Section is repealed on December 31, 2024.
4340	4340	22 (Source: P.A. 101-9, eff. 6-5-19; 102-282, eff. 1-1-22.)
4341	4341	23 (Text of Section from P.A. 102-558)
4342	4342	24 Sec. 15.35. Franchise taxes payable by domestic
4343	4343	25 corporations. For the privilege of exercising its franchises
4344	4344
4345	4345
4346	4346
4347	4347
4348	4348
4349	4349	SB1535 - 120 - LRB103 25041 HLH 51375 b
4350	4350
4351	4351
4352	4352	SB1535- 121 -LRB103 25041 HLH 51375 b SB1535 - 121 - LRB103 25041 HLH 51375 b
4353	4353	SB1535 - 121 - LRB103 25041 HLH 51375 b
4354	4354	1 in this State, each domestic corporation shall pay to the
4355	4355	2 Secretary of State the following franchise taxes, computed on
4356	4356	3 the basis, at the rates and for the periods prescribed in this
4357	4357	4 Act:
4358	4358	5 (a) An initial franchise tax at the time of filing its
4359	4359	6 first report of issuance of shares.
4360	4360	7 (b) An additional franchise tax at the time of filing
4361	4361	8 (1) a report of the issuance of additional shares, or (2) a
4362	4362	9 report of an increase in paid-in capital without the
4363	4363	10 issuance of shares, or (3) an amendment to the articles of
4364	4364	11 incorporation or a report of cumulative changes in paid-in
4365	4365	12 capital, whenever any amendment or such report discloses
4366	4366	13 an increase in its paid-in capital over the amount thereof
4367	4367	14 last reported in any document, other than an annual
4368	4368	15 report, interim annual report or final transition annual
4369	4369	16 report required by this Act to be filed in the office of
4370	4370	17 the Secretary of State.
4371	4371	18 (c) An additional franchise tax at the time of filing
4372	4372	19 a report of paid-in capital following a statutory merger
4373	4373	20 or consolidation, which discloses that the paid-in capital
4374	4374	21 of the surviving or new corporation immediately after the
4375	4375	22 merger or consolidation is greater than the sum of the
4376	4376	23 paid-in capital of all of the merged or consolidated
4377	4377	24 corporations as last reported by them in any documents,
4378	4378	25 other than annual reports, required by this Act to be
4379	4379	26 filed in the office of the Secretary of State; and in
4380	4380
4381	4381
4382	4382
4383	4383
4384	4384
4385	4385	SB1535 - 121 - LRB103 25041 HLH 51375 b
4386	4386
4387	4387
4388	4388	SB1535- 122 -LRB103 25041 HLH 51375 b SB1535 - 122 - LRB103 25041 HLH 51375 b
4389	4389	SB1535 - 122 - LRB103 25041 HLH 51375 b
4390	4390	1 addition, the surviving or new corporation shall be liable
4391	4391	2 for a further additional franchise tax on the paid-in
4392	4392	3 capital of each of the merged or consolidated corporations
4393	4393	4 as last reported by them in any document, other than an
4394	4394	5 annual report, required by this Act to be filed with the
4395	4395	6 Secretary of State from their taxable year end to the next
4396	4396	7 succeeding anniversary month or, in the case of a
4397	4397	8 corporation which has established an extended filing
4398	4398	9 month, the extended filing month of the surviving or new
4399	4399	10 corporation; however if the taxable year ends within the
4400	4400	11 2-month period immediately preceding the anniversary month
4401	4401	12 or, in the case of a corporation which has established an
4402	4402	13 extended filing month, the extended filing month of the
4403	4403	14 surviving or new corporation the tax will be computed to
4404	4404	15 the anniversary month or, in the case of a corporation
4405	4405	16 which has established an extended filing month, the
4406	4406	17 extended filing month of the surviving or new corporation
4407	4407	18 in the next succeeding calendar year.
4408	4408	19 (d) An annual franchise tax payable each year with the
4409	4409	20 annual report which the corporation is required by this
4410	4410	21 Act to file.
4411	4411	22 On or after January 1, 2020 and prior to January 1, 2021,
4412	4412	23 the first $30 in liability is exempt from the tax imposed under
4413	4413	24 this Section. On or after January 1, 2021 and prior to January
4414	4414	25 1, 2022, the first $1,000 in liability is exempt from the tax
4415	4415	26 imposed under this Section. On or after January 1, 2022 and
4416	4416
4417	4417
4418	4418
4419	4419
4420	4420
4421	4421	SB1535 - 122 - LRB103 25041 HLH 51375 b
4422	4422
4423	4423
4424	4424	SB1535- 123 -LRB103 25041 HLH 51375 b SB1535 - 123 - LRB103 25041 HLH 51375 b
4425	4425	SB1535 - 123 - LRB103 25041 HLH 51375 b
4426	4426	1 prior to January 1, 2023, the first $10,000 in liability is
4427	4427	2 exempt from the tax imposed under this Section. On or after
4428	4428	3 January 1, 2023 and prior to January 1, 2024, the first
4429	4429	4 $100,000 in liability is exempt from the tax imposed under
4430	4430	5 this Section. The provisions of this Section shall not require
4431	4431	6 the payment of any franchise tax that would otherwise have
4432	4432	7 been due and payable on or after January 1, 2024. There shall
4433	4433	8 be no refunds or proration of franchise tax for any taxes due
4434	4434	9 and payable on or after January 1, 2024 on the basis that a
4435	4435	10 portion of the corporation's taxable year extends beyond
4436	4436	11 January 1, 2024. Public Act 101-9 shall not affect any right
4437	4437	12 accrued or established, or any liability or penalty incurred
4438	4438	13 prior to January 1, 2024.
4439	4439	14 This Section is repealed on December 31, 2024 December 31,
4440	4440	15 2025.
4441	4441	16 (Source: P.A. 101-9, eff. 6-5-19; 102-558, eff. 8-20-21.)
4442	4442	17 (805 ILCS 5/15.65) (from Ch. 32, par. 15.65)
4443	4443	18 Sec. 15.65. Franchise taxes payable by foreign
4444	4444	19 corporations. For the privilege of exercising its authority to
4445	4445	20 transact such business in this State as set out in its
4446	4446	21 application therefor or any amendment thereto, each foreign
4447	4447	22 corporation shall pay to the Secretary of State the following
4448	4448	23 franchise taxes, computed on the basis, at the rates and for
4449	4449	24 the periods prescribed in this Act:
4450	4450	25 (a) An initial franchise tax at the time of filing its
4451	4451
4452	4452
4453	4453
4454	4454
4455	4455
4456	4456	SB1535 - 123 - LRB103 25041 HLH 51375 b
4457	4457
4458	4458
4459	4459	SB1535- 124 -LRB103 25041 HLH 51375 b SB1535 - 124 - LRB103 25041 HLH 51375 b
4460	4460	SB1535 - 124 - LRB103 25041 HLH 51375 b
4461	4461	1 application for authority to transact business in this
4462	4462	2 State.
4463	4463	3 (b) An additional franchise tax at the time of filing
4464	4464	4 (1) a report of the issuance of additional shares, or (2) a
4465	4465	5 report of an increase in paid-in capital without the
4466	4466	6 issuance of shares, or (3) a report of cumulative changes
4467	4467	7 in paid-in capital or a report of an exchange or
4468	4468	8 reclassification of shares, whenever any such report
4469	4469	9 discloses an increase in its paid-in capital over the
4470	4470	10 amount thereof last reported in any document, other than
4471	4471	11 an annual report, interim annual report or final
4472	4472	12 transition annual report, required by this Act to be filed
4473	4473	13 in the office of the Secretary of State.
4474	4474	14 (c) Whenever the corporation shall be a party to a
4475	4475	15 statutory merger and shall be the surviving corporation,
4476	4476	16 an additional franchise tax at the time of filing its
4477	4477	17 report following merger, if such report discloses that the
4478	4478	18 amount represented in this State of its paid-in capital
4479	4479	19 immediately after the merger is greater than the aggregate
4480	4480	20 of the amounts represented in this State of the paid-in
4481	4481	21 capital of such of the merged corporations as were
4482	4482	22 authorized to transact business in this State at the time
4483	4483	23 of the merger, as last reported by them in any documents,
4484	4484	24 other than annual reports, required by this Act to be
4485	4485	25 filed in the office of the Secretary of State; and in
4486	4486	26 addition, the surviving corporation shall be liable for a
4487	4487
4488	4488
4489	4489
4490	4490
4491	4491
4492	4492	SB1535 - 124 - LRB103 25041 HLH 51375 b
4493	4493
4494	4494
4495	4495	SB1535- 125 -LRB103 25041 HLH 51375 b SB1535 - 125 - LRB103 25041 HLH 51375 b
4496	4496	SB1535 - 125 - LRB103 25041 HLH 51375 b
4497	4497	1 further additional franchise tax on the paid-in capital of
4498	4498	2 each of the merged corporations as last reported by them
4499	4499	3 in any document, other than an annual report, required by
4500	4500	4 this Act to be filed with the Secretary of State, from
4501	4501	5 their taxable year end to the next succeeding anniversary
4502	4502	6 month or, in the case of a corporation which has
4503	4503	7 established an extended filing month, the extended filing
4504	4504	8 month of the surviving corporation; however if the taxable
4505	4505	9 year ends within the 2-month period immediately preceding
4506	4506	10 the anniversary month or the extended filing month of the
4507	4507	11 surviving corporation, the tax will be computed to the
4508	4508	12 anniversary or, extended filing month of the surviving
4509	4509	13 corporation in the next succeeding calendar year.
4510	4510	14 (d) An annual franchise tax payable each year with any
4511	4511	15 annual report which the corporation is required by this
4512	4512	16 Act to file.
4513	4513	17 On or after January 1, 2020 and prior to January 1, 2021,
4514	4514	18 the first $30 in liability is exempt from the tax imposed under
4515	4515	19 this Section. On or after January 1, 2021 and prior to January
4516	4516	20 1, 2022, the first $1,000 in liability is exempt from the tax
4517	4517	21 imposed under this Section. On and after January 1, 2022 and
4518	4518	22 prior to January 1, 2023, the first $10,000 in liability is
4519	4519	23 exempt from the tax imposed under this Section. On and after
4520	4520	24 January 1, 2023 and prior to January 1, 2024, the first
4521	4521	25 $100,000 in liability is exempt from the tax imposed under
4522	4522	26 this Section. The provisions of this Section shall not require
4523	4523
4524	4524
4525	4525
4526	4526
4527	4527
4528	4528	SB1535 - 125 - LRB103 25041 HLH 51375 b
4529	4529
4530	4530
4531	4531	SB1535- 126 -LRB103 25041 HLH 51375 b SB1535 - 126 - LRB103 25041 HLH 51375 b
4532	4532	SB1535 - 126 - LRB103 25041 HLH 51375 b
4533	4533	1 the payment of any franchise tax that would otherwise have
4534	4534	2 been due and payable on or after January 1, 2024. There shall
4535	4535	3 be no refunds or proration of franchise tax for any taxes due
4536	4536	4 and payable on or after January 1, 2024 on the basis that a
4537	4537	5 portion of the corporation's taxable year extends beyond
4538	4538	6 January 1, 2024. Public Act 101-9 shall not affect any right
4539	4539	7 accrued or established, or any liability or penalty incurred
4540	4540	8 prior to January 1, 2024.
4541	4541	9 This Section is repealed on December 31, 2024.
4542	4542	10 (Source: P.A. 101-9, eff. 6-5-19; 102-16, eff. 6-17-21;
4543	4543	11 102-558, eff. 8-20-21; 102-813, eff. 5-13-22.)
4544	4544	12 Section 99. Effective date. This Act takes effect upon
4545	4545	13 becoming law.
4546	4546
4547	4547
4548	4548
4549	4549
4550	4550
4551	4551	SB1535 - 126 - LRB103 25041 HLH 51375 b