Illinois 2023-2024 Regular Session

Illinois Senate Bill SB3249 Compare Versions

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

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1	1	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3249 Introduced 2/6/2024, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2024, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately. LRB103 37843 HLH 67973 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3249 Introduced 2/6/2024, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2024, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately. LRB103 37843 HLH 67973 b LRB103 37843 HLH 67973 b A BILL FOR
2	2	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3249 Introduced 2/6/2024, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 16/10 35 ILCS 16/10
4	4	35 ILCS 16/10
5	5	Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2024, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately.
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11	11	1 AN ACT concerning revenue.
12	12	2 Be it enacted by the People of the State of Illinois,
13	13	3 represented in the General Assembly:
14	14	4 Section 5. The Film Production Services Tax Credit Act of
15	15	5 2008 is amended by changing Section 10 as follows:
16	16	6 (35 ILCS 16/10)
17	17	7 Sec. 10. Definitions. As used in this Act:
18	18	8 "Accredited production" means: (i) for productions
19	19	9 commencing before May 1, 2006, a film, video, or television
20	20	10 production that has been certified by the Department in which
21	21	11 the aggregate Illinois labor expenditures included in the cost
22	22	12 of the production, in the period that ends 12 months after the
23	23	13 time principal filming or taping of the production began,
24	24	14 exceed $100,000 for productions of 30 minutes or longer, or
25	25	15 $50,000 for productions of less than 30 minutes; and (ii) for
26	26	16 productions commencing on or after May 1, 2006, a film, video,
27	27	17 or television production that has been certified by the
28	28	18 Department in which the Illinois production spending included
29	29	19 in the cost of production in the period that ends 12 months
30	30	20 after the time principal filming or taping of the production
31	31	21 began exceeds $100,000 for productions of 30 minutes or longer
32	32	22 or exceeds $50,000 for productions of less than 30 minutes.
33	33	23 "Accredited production" does not include a production that:
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37	37	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3249 Introduced 2/6/2024, by Sen. Dale Fowler SYNOPSIS AS INTRODUCED:
38	38	35 ILCS 16/10 35 ILCS 16/10
39	39	35 ILCS 16/10
40	40	Amends the Film Production Services Tax Credit Act of 2008. Provides that, for an accredited production that commences on or after July 1, 2024, the credit includes the sum of the following: 30% of the Illinois production spending for the taxable year; 15% of the Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment, as determined by the Department of Commerce and Economic Opportunity; an additional 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area if the person is a resident of a geographic area of high poverty or high unemployment and also resides outside of the metropolitan area; and (iv) an additional 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area, as determined by the Department. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately.
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49	49	35 ILCS 16/10
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68	68	1 (1) is news, current events, or public programming, or
69	69	2 a program that includes weather or market reports;
70	70	3 (2) is a talk show;
71	71	4 (3) is a production in respect of a game,
72	72	5 questionnaire, or contest;
73	73	6 (4) is a sports event or activity;
74	74	7 (5) is a gala presentation or awards show;
75	75	8 (6) is a finished production that solicits funds;
76	76	9 (7) is a production produced by a film production
77	77	10 company if records, as required by 18 U.S.C. 2257, are to
78	78	11 be maintained by that film production company with respect
79	79	12 to any performer portrayed in that single media or
80	80	13 multimedia program; or
81	81	14 (8) is a production produced primarily for industrial,
82	82	15 corporate, or institutional purposes.
83	83	16 "Accredited animated production" means an accredited
84	84	17 production in which movement and characters' performances are
85	85	18 created using a frame-by-frame technique and a significant
86	86	19 number of major characters are animated. Motion capture by
87	87	20 itself is not an animation technique.
88	88	21 "Accredited production certificate" means a certificate
89	89	22 issued by the Department certifying that the production is an
90	90	23 accredited production that meets the guidelines of this Act.
91	91	24 "Applicant" means a taxpayer that is a film production
92	92	25 company that is operating or has operated an accredited
93	93	26 production located within the State of Illinois and that (i)
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104	104	1 owns the copyright in the accredited production throughout the
105	105	2 Illinois production period or (ii) has contracted directly
106	106	3 with the owner of the copyright in the accredited production
107	107	4 or a person acting on behalf of the owner to provide services
108	108	5 for the production, where the owner of the copyright is not an
109	109	6 eligible production corporation.
110	110	7 "Credit" means:
111	111	8 (1) for an accredited production approved by the
112	112	9 Department on or before January 1, 2005 and commencing
113	113	10 before May 1, 2006, the amount equal to 25% of the Illinois
114	114	11 labor expenditure approved by the Department. The
115	115	12 applicant is deemed to have paid, on its balance due day
116	116	13 for the year, an amount equal to 25% of its qualified
117	117	14 Illinois labor expenditure for the tax year. For Illinois
118	118	15 labor expenditures generated by the employment of
119	119	16 residents of geographic areas of high poverty or high
120	120	17 unemployment, as determined by the Department, in an
121	121	18 accredited production commencing before May 1, 2006 and
122	122	19 approved by the Department after January 1, 2005, the
123	123	20 applicant shall receive an enhanced credit of 10% in
124	124	21 addition to the 25% credit; and
125	125	22 (2) for an accredited production commencing on or
126	126	23 after May 1, 2006 and before January 1, 2009, the amount
127	127	24 equal to:
128	128	25 (i) 20% of the Illinois production spending for
129	129	26 the taxable year; plus
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140	140	1 (ii) 15% of the Illinois labor expenditures
141	141	2 generated by the employment of residents of geographic
142	142	3 areas of high poverty or high unemployment, as
143	143	4 determined by the Department; and
144	144	5 (3) for an accredited production commencing on or
145	145	6 after January 1, 2009 and before July 1, 2024, the amount
146	146	7 equal to:
147	147	8 (i) 30% of the Illinois production spending for
148	148	9 the taxable year; plus
149	149	10 (ii) 15% of the Illinois labor expenditures
150	150	11 generated by the employment of residents of geographic
151	151	12 areas of high poverty or high unemployment, as
152	152	13 determined by the Department; and .
153	153	14 (4) for an accredited production commencing on or
154	154	15 after July 1, 2024, the amount equal to:
155	155	16 (i) 30% of the Illinois production spending for
156	156	17 the taxable year; plus
157	157	18 (ii) 15% of the Illinois labor expenditures
158	158	19 generated by the employment of residents of geographic
159	159	20 areas of high poverty or high unemployment, as
160	160	21 determined by the Department; plus
161	161	22 (iii) 5% of the Illinois labor expenditures
162	162	23 generated by the employment of residents of the State
163	163	24 who reside outside of the metropolitan area; if the
164	164	25 person is a resident of a geographic area of high
165	165	26 poverty or high unemployment and also resides outside
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176	176	1 of the metropolitan area, then the credit includes
177	177	2 both subparagraph (ii) and this subparagraph (iii);
178	178	3 plus
179	179	4 (iv) if 50% or more of the total hours of principal
180	180	5 filming or taping of the production are completed in
181	181	6 the State but outside of the metropolitan area, as
182	182	7 determined by the Department, then the total amount of
183	183	8 the credit under subparagraphs (i), (ii), and (iii),
184	184	9 as applicable, shall be increased by 5%.
185	185	10 "Department" means the Department of Commerce and Economic
186	186	11 Opportunity.
187	187	12 "Director" means the Director of Commerce and Economic
188	188	13 Opportunity.
189	189	14 "Illinois labor expenditure" means salary or wages paid to
190	190	15 employees of the applicant for services on the accredited
191	191	16 production.
192	192	17 To qualify as an Illinois labor expenditure, the
193	193	18 expenditure must be:
194	194	19 (1) Reasonable in the circumstances.
195	195	20 (2) Included in the federal income tax basis of the
196	196	21 property.
197	197	22 (3) Incurred by the applicant for services on or after
198	198	23 January 1, 2004.
199	199	24 (4) Incurred for the production stages of the
200	200	25 accredited production, from the final script stage to the
201	201	26 end of the post-production stage.
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212	212	1 (5) Limited to the first $25,000 of wages paid or
213	213	2 incurred to each employee of a production commencing
214	214	3 before May 1, 2006 and the first $100,000 of wages paid or
215	215	4 incurred to each employee of a production commencing on or
216	216	5 after May 1, 2006 and prior to July 1, 2022. For
217	217	6 productions commencing on or after July 1, 2022, limited
218	218	7 to the first $500,000 of wages paid or incurred to each
219	219	8 eligible nonresident or resident employee of a production
220	220	9 company or loan out company that provides in-State
221	221	10 services to a production, whether those wages are paid or
222	222	11 incurred by the production company, loan out company, or
223	223	12 both, subject to withholding payments provided for in
224	224	13 Article 7 of the Illinois Income Tax Act. For purposes of
225	225	14 calculating Illinois labor expenditures for a television
226	226	15 series, the eligible nonresident wage limitations provided
227	227	16 under this subparagraph are applied to the entire season.
228	228	17 For the purpose of this paragraph (5), an eligible
229	229	18 nonresident is a nonresident whose wages qualify as an
230	230	19 Illinois labor expenditure under the provisions of
231	231	20 paragraph (9) that apply to that production.
232	232	21 (6) For a production commencing before May 1, 2006,
233	233	22 exclusive of the salary or wages paid to or incurred for
234	234	23 the 2 highest paid employees of the production.
235	235	24 (7) Directly attributable to the accredited
236	236	25 production.
237	237	26 (8) (Blank).
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248	248	1 (9) Prior to July 1, 2022, paid to persons resident in
249	249	2 Illinois at the time the payments were made. For a
250	250	3 production commencing on or after July 1, 2022, paid to
251	251	4 persons resident in Illinois and nonresidents at the time
252	252	5 the payments were made.
253	253	6 For purposes of this subparagraph, if the production
254	254	7 is accredited by the Department before the effective date
255	255	8 of this amendatory Act of the 102nd General Assembly, only
256	256	9 wages paid to nonresidents working in the following
257	257	10 positions shall be considered Illinois labor expenditures:
258	258	11 Writer, Director, Director of Photography, Production
259	259	12 Designer, Costume Designer, Production Accountant, VFX
260	260	13 Supervisor, Editor, Composer, and Actor, subject to the
261	261	14 limitations set forth under this subparagraph. For an
262	262	15 accredited Illinois production spending of $25,000,000 or
263	263	16 less, no more than 2 nonresident actors' wages shall
264	264	17 qualify as an Illinois labor expenditure. For an
265	265	18 accredited production with Illinois production spending of
266	266	19 more than $25,000,000, no more than 4 nonresident actor's
267	267	20 wages shall qualify as Illinois labor expenditures.
268	268	21 For purposes of this subparagraph, if the production
269	269	22 is accredited by the Department on or after the effective
270	270	23 date of this amendatory Act of the 102nd General Assembly,
271	271	24 wages paid to nonresidents shall qualify as Illinois labor
272	272	25 expenditures only under the following conditions:
273	273	26 (A) the nonresident must be employed in a
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284	284	1 qualified position;
285	285	2 (B) for each of those accredited productions, the
286	286	3 wages of not more than 9 nonresidents who are employed
287	287	4 in a qualified position other than Actor shall qualify
288	288	5 as Illinois labor expenditures;
289	289	6 (C) for an accredited production with Illinois
290	290	7 production spending of $25,000,000 or less, no more
291	291	8 than 2 nonresident actors' wages shall qualify as
292	292	9 Illinois labor expenditures; and
293	293	10 (D) for an accredited production with Illinois
294	294	11 production spending of more than $25,000,000, no more
295	295	12 than 4 nonresident actors' wages shall qualify as
296	296	13 Illinois labor expenditures.
297	297	14 As used in this paragraph (9), "qualified position"
298	298	15 means: Writer, Director, Director of Photography,
299	299	16 Production Designer, Costume Designer, Production
300	300	17 Accountant, VFX Supervisor, Editor, Composer, or Actor.
301	301	18 (10) Paid for services rendered in Illinois.
302	302	19 "Illinois production spending" means the expenses incurred
303	303	20 by the applicant for an accredited production, including,
304	304	21 without limitation, all of the following:
305	305	22 (1) expenses to purchase, from vendors within
306	306	23 Illinois, tangible personal property that is used in the
307	307	24 accredited production;
308	308	25 (2) expenses to acquire services, from vendors in
309	309	26 Illinois, for film production, editing, or processing; and
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320	320	1 (3) for a production commencing before July 1, 2022,
321	321	2 the compensation, not to exceed $100,000 for any one
322	322	3 employee, for contractual or salaried employees who are
323	323	4 Illinois residents performing services with respect to the
324	324	5 accredited production. For a production commencing on or
325	325	6 after July 1, 2022, the compensation, not to exceed
326	326	7 $500,000 for any one employee, for contractual or salaried
327	327	8 employees who are Illinois residents or nonresident
328	328	9 employees, subject to the limitations set forth under
329	329	10 Section 10 of this Act.
330	330	11 "Loan out company" means a personal service corporation or
331	331	12 other entity that is under contract with the taxpayer to
332	332	13 provide specified individual personnel, such as artists, crew,
333	333	14 actors, producers, or directors for the performance of
334	334	15 services used directly in a production. "Loan out company"
335	335	16 does not include entities contracted with by the taxpayer to
336	336	17 provide goods or ancillary contractor services such as
337	337	18 catering, construction, trailers, equipment, or
338	338	19 transportation.
339	339	20 "Metropolitan area" means the City of Chicago and any part
340	340	21 of the State located within 30 miles of the corporate limits of
341	341	22 the City of Chicago.
342	342	23 "Qualified production facility" means stage facilities in
343	343	24 the State in which television shows and films are or are
344	344	25 intended to be regularly produced and that contain at least
345	345	26 one sound stage of at least 15,000 square feet.
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356	356	1 Rulemaking authority to implement Public Act 95-1006, if
357	357	2 any, is conditioned on the rules being adopted in accordance
358	358	3 with all provisions of the Illinois Administrative Procedure
359	359	4 Act and all rules and procedures of the Joint Committee on
360	360	5 Administrative Rules; any purported rule not so adopted, for
361	361	6 whatever reason, is unauthorized.
362	362	7 (Source: P.A. 102-558, eff. 8-20-21; 102-700, eff. 4-19-22;
363	363	8 102-1125, eff. 2-3-23.)
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