Illinois 2025-2026 Regular Session

Illinois House Bill HB1501 Compare Versions

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

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1	1	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1501 Introduced , by Rep. Dan Swanson SYNOPSIS AS INTRODUCED: 35 ILCS 5/246 new Amends the Illinois Income Tax Act. Creates an income tax credit for an owner of an agricultural asset who sells or rents the agricultural asset to a beginning farmer. Sets forth the amount of the credit. Provides that the amount of the credit awarded with respect to any single sale or lease agreement shall not exceed $50,000 in any taxable year. Provides that the taxpayer shall apply to the Department of Agriculture for credits under the program. Provides that, for taxable years beginning on or after January 1, 2025 and beginning before January 1, 2030, the Department of Agriculture may not approve more than $5,000,000 in credits under the program in any taxable year. Provides that, for taxable years beginning on or after January 1, 2030, the Department of Agriculture may not approve more than $10,000,000 in credits under the program in any taxable year. Effective immediately. LRB104 03362 HLH 17518 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1501 Introduced , by Rep. Dan Swanson SYNOPSIS AS INTRODUCED: 35 ILCS 5/246 new 35 ILCS 5/246 new Amends the Illinois Income Tax Act. Creates an income tax credit for an owner of an agricultural asset who sells or rents the agricultural asset to a beginning farmer. Sets forth the amount of the credit. Provides that the amount of the credit awarded with respect to any single sale or lease agreement shall not exceed $50,000 in any taxable year. Provides that the taxpayer shall apply to the Department of Agriculture for credits under the program. Provides that, for taxable years beginning on or after January 1, 2025 and beginning before January 1, 2030, the Department of Agriculture may not approve more than $5,000,000 in credits under the program in any taxable year. Provides that, for taxable years beginning on or after January 1, 2030, the Department of Agriculture may not approve more than $10,000,000 in credits under the program in any taxable year. Effective immediately. LRB104 03362 HLH 17518 b LRB104 03362 HLH 17518 b A BILL FOR
2	2	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1501 Introduced , by Rep. Dan Swanson SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 5/246 new 35 ILCS 5/246 new
4	4	35 ILCS 5/246 new
5	5	Amends the Illinois Income Tax Act. Creates an income tax credit for an owner of an agricultural asset who sells or rents the agricultural asset to a beginning farmer. Sets forth the amount of the credit. Provides that the amount of the credit awarded with respect to any single sale or lease agreement shall not exceed $50,000 in any taxable year. Provides that the taxpayer shall apply to the Department of Agriculture for credits under the program. Provides that, for taxable years beginning on or after January 1, 2025 and beginning before January 1, 2030, the Department of Agriculture may not approve more than $5,000,000 in credits under the program in any taxable year. Provides that, for taxable years beginning on or after January 1, 2030, the Department of Agriculture may not approve more than $10,000,000 in credits under the program in any taxable year. 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 Illinois Income Tax Act is amended by
15	15	5 adding Section 246 as follows:
16	16	6 (35 ILCS 5/246 new)
17	17	7 Sec. 246. Agricultural assets; beginning farmer.
18	18	8 (a) For taxable years beginning on or after January 1,
19	19	9 2025, an owner of an agricultural asset in this State may take
20	20	10 a credit against the tax imposed under subsections (a) and (b)
21	21	11 of Section 201, in an amount approved by the Department, for
22	22	12 the sale or rental of the agricultural asset to a beginning
23	23	13 farmer. Subject to the limitations set forth in this
24	24	14 subsection (a), the amount of the credit shall be equal to:
25	25	15 (1) if the agricultural asset is sold to a beginning
26	26	16 farmer, 5% of the lesser of the sale price or the fair
27	27	17 market value of the agricultural asset at the time of the
28	28	18 sale;
29	29	19 (2) if the agricultural asset is leased to a beginning
30	30	20 farmer pursuant to a cash rent lease, 5% of the amount of
31	31	21 the fixed cash rent payment that is due to the owner of the
32	32	22 agricultural asset during the taxable year under the terms
33	33	23 of the lease;
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37	37	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1501 Introduced , by Rep. Dan Swanson SYNOPSIS AS INTRODUCED:
38	38	35 ILCS 5/246 new 35 ILCS 5/246 new
39	39	35 ILCS 5/246 new
40	40	Amends the Illinois Income Tax Act. Creates an income tax credit for an owner of an agricultural asset who sells or rents the agricultural asset to a beginning farmer. Sets forth the amount of the credit. Provides that the amount of the credit awarded with respect to any single sale or lease agreement shall not exceed $50,000 in any taxable year. Provides that the taxpayer shall apply to the Department of Agriculture for credits under the program. Provides that, for taxable years beginning on or after January 1, 2025 and beginning before January 1, 2030, the Department of Agriculture may not approve more than $5,000,000 in credits under the program in any taxable year. Provides that, for taxable years beginning on or after January 1, 2030, the Department of Agriculture may not approve more than $10,000,000 in credits under the program in any taxable year. Effective immediately.
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43	43	A BILL FOR
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68	68	1 (3) if the agricultural asset is leased to a beginning
69	69	2 farmer pursuant to a commodity share lease, 15% of the
70	70	3 gross amount that the owner of the agricultural asset
71	71	4 would receive as a rent payment from the sale of the
72	72	5 owner's share of the commodity during the taxable year,
73	73	6 based on a formula developed by the Department of
74	74	7 Agriculture, by rule, using data compiled by the United
75	75	8 States Department of Agriculture; and
76	76	9 (4) if the agricultural asset is leased to a beginning
77	77	10 farmer pursuant to a flexible lease, 5% of the amount of
78	78	11 the fixed cash payment that is due to the owner of the
79	79	12 agricultural asset during the taxable year under the terms
80	80	13 of the lease.
81	81	14 The amount of the credit awarded under this Section with
82	82	15 respect to any single sale or lease agreement shall not exceed
83	83	16 $50,000 in any taxable year. For taxable years beginning on or
84	84	17 after January 1, 2025 and beginning before January 1, 2030,
85	85	18 the Department may not approve more than $5,000,000 in credits
86	86	19 under this Section in any taxable year. For taxable years
87	87	20 beginning on or after January 1, 2030, the Department may not
88	88	21 approve more than $10,000,000 in credits under this Section in
89	89	22 any taxable year.
90	90	23 (b) If the agricultural asset is leased to a beginning
91	91	24 farmer, the term of the lease agreement must be at least 2
92	92	25 years but not more than 5 years.
93	93	26 (c) The owner of the agricultural asset must apply to the
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104	104	1 Department by August 1 of the taxable year for approval of the
105	105	2 tax credit under this Section. The application must:
106	106	3 (1) identify the beginning farmer to whom the assets
107	107	4 are sold or rented;
108	108	5 (2) specify whether the beginning farmer is a brother,
109	109	6 sister, ancestor, or lineal descendant of the taxpayer;
110	110	7 and
111	111	8 (3) contain any other information deemed necessary by
112	112	9 the Department.
113	113	10 If the Department grants the taxpayer a credit under this
114	114	11 Section, the Department shall issue a tax credit certificate
115	115	12 to the taxpayer, and the taxpayer shall attach a copy of the
116	116	13 certificate to his or her Illinois income tax return for the
117	117	14 taxable year. The credit shall be claimed in the taxable year
118	118	15 for which the tax credit certificate is issued.
119	119	16 (d) In no event shall a credit under this Section reduce
120	120	17 the taxpayer's liability to less than zero. If the amount of
121	121	18 the credit exceeds the tax liability for the year, the excess
122	122	19 may be carried forward and applied to the tax liability of the
123	123	20 5 taxable years following the excess credit year. The tax
124	124	21 credit shall be applied to the earliest year for which there is
125	125	22 a tax liability. If there are credits for more than one year
126	126	23 that are available to offset a liability, the earlier credit
127	127	24 shall be applied first.
128	128	25 (e) For partners and shareholders of subchapter S
129	129	26 corporations, the provisions of Section 251 shall apply with
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140	140	1 respect to the credit under this Section.
141	141	2 (f) As used in this Section:
142	142	3 "Agricultural asset" means agricultural land, livestock,
143	143	4 facilities, buildings, and machinery used for farming.
144	144	5 "Beginning farmer" means a person who:
145	145	6 (1) has demonstrated experience in agriculture or a
146	146	7 related field or has transferable skills, as determined by
147	147	8 the Department;
148	148	9 (2) has not received income from agricultural
149	149	10 production for more than the 10 most recent taxable years;
150	150	11 (3) intends to engage in agricultural production
151	151	12 within the State and to provide the majority of the labor
152	152	13 and management involved in the agricultural production;
153	153	14 (4) has obtained certification from the Department as
154	154	15 a beginning farmer;
155	155	16 (5) is not, and whose spouse is not, a partner,
156	156	17 member, shareholder, or trustee of the owner of the
157	157	18 agricultural asset; and
158	158	19 (6) is not a brother, sister, ancestor, or lineal
159	159	20 descendant of the owner of the agricultural asset.
160	160	21 "Cash rent lease" means a rental agreement pursuant to
161	161	22 which the owner of an agricultural asset receives a fixed cash
162	162	23 rent payment in exchange for the use of the agricultural asset
163	163	24 by a beginning farmer.
164	164	25 "Commodity share lease" means a rental agreement pursuant
165	165	26 to which the owner of an agricultural asset receives as a rent
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176	176	1 payment a percentage of the commodity produced by the
177	177	2 beginning farmer.
178	178	3 "Department" means the Department of Agriculture.
179	179	4 "Farming" means the active use, management, and operation
180	180	5 of real and personal property for agricultural production.
181	181	6 "Flexible lease" means an agreement pursuant to which the
182	182	7 owner of the agricultural asset receives a rent payment
183	183	8 consisting of a fixed cash payment and an amount subject to
184	184	9 adjustment according to a risk-sharing arrangement.
185	185	10 "Owner of an agricultural asset" means an individual,
186	186	11 trust or pass-through entity that is the owner in fee simple of
187	187	12 agricultural land or has legal title to any other agricultural
188	188	13 asset. The term does not include an equipment dealer,
189	189	14 livestock dealer, or comparable entity that is engaged in the
190	190	15 business of selling agricultural assets for profit and that is
191	191	16 not engaged in farming as its primary business activity.
192	192	17 (g) This Section is exempt from the provisions of Section
193	193	18 250.
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