Illinois 2025-2026 Regular Session

Illinois Senate Bill SB1505 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 SB1505 Introduced 2/4/2025, by Sen. Willie Preston SYNOPSIS AS INTRODUCED: 35 ILCS 25/1035 ILCS 25/2535 ILCS 25/35 Amends the Small Business Job Creation Tax Credit Act. Renews the program for incentive periods beginning on or after July 1, 2025 and ending on or before June 30, 2032. Removes language concerning the Put Illinois to Work Program for the second series of incentive periods. Provides that the term "full-time employee" means an individual who is employed for a basic wage for at least 35 hours each week (currently, employed for a basic wage for at least 35 hours each week or renders any other standard of service generally accepted by industry custom or practice as full-time employment). Provides that a net increase in the number of full-time Illinois employees shall be treated as continuous if a different new employee is hired as a replacement within 8 weeks after the position becomes vacant (currently, a reasonable time). Effective immediately. LRB104 07601 HLH 17645 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1505 Introduced 2/4/2025, by Sen. Willie Preston SYNOPSIS AS INTRODUCED: 35 ILCS 25/1035 ILCS 25/2535 ILCS 25/35 35 ILCS 25/10 35 ILCS 25/25 35 ILCS 25/35 Amends the Small Business Job Creation Tax Credit Act. Renews the program for incentive periods beginning on or after July 1, 2025 and ending on or before June 30, 2032. Removes language concerning the Put Illinois to Work Program for the second series of incentive periods. Provides that the term "full-time employee" means an individual who is employed for a basic wage for at least 35 hours each week (currently, employed for a basic wage for at least 35 hours each week or renders any other standard of service generally accepted by industry custom or practice as full-time employment). Provides that a net increase in the number of full-time Illinois employees shall be treated as continuous if a different new employee is hired as a replacement within 8 weeks after the position becomes vacant (currently, a reasonable time). Effective immediately. LRB104 07601 HLH 17645 b LRB104 07601 HLH 17645 b A BILL FOR
2	2	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1505 Introduced 2/4/2025, by Sen. Willie Preston SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 25/1035 ILCS 25/2535 ILCS 25/35 35 ILCS 25/10 35 ILCS 25/25 35 ILCS 25/35
4	4	35 ILCS 25/10
5	5	35 ILCS 25/25
6	6	35 ILCS 25/35
7	7	Amends the Small Business Job Creation Tax Credit Act. Renews the program for incentive periods beginning on or after July 1, 2025 and ending on or before June 30, 2032. Removes language concerning the Put Illinois to Work Program for the second series of incentive periods. Provides that the term "full-time employee" means an individual who is employed for a basic wage for at least 35 hours each week (currently, employed for a basic wage for at least 35 hours each week or renders any other standard of service generally accepted by industry custom or practice as full-time employment). Provides that a net increase in the number of full-time Illinois employees shall be treated as continuous if a different new employee is hired as a replacement within 8 weeks after the position becomes vacant (currently, a reasonable time). Effective immediately.
8	8	LRB104 07601 HLH 17645 b LRB104 07601 HLH 17645 b
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10	10	A BILL FOR
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13	13	1 AN ACT concerning revenue.
14	14	2 Be it enacted by the People of the State of Illinois,
15	15	3 represented in the General Assembly:
16	16	4 Section 5. The Small Business Job Creation Tax Credit Act
17	17	5 is amended by changing Sections 10, 25, and 35 as follows:
18	18	6 (35 ILCS 25/10)
19	19	7 Sec. 10. Definitions. In this Act:
20	20	8 "Applicant" means a person that is operating a business
21	21	9 located within the State of Illinois that is engaged in
22	22	10 interstate or intrastate commerce and either:
23	23	11 (1) has no more than 50 full-time employees, without
24	24	12 regard to the location of employment of such employees at
25	25	13 the beginning of the incentive period; or
26	26	14 (2) for incentive periods ending on or before June 30,
27	27	15 2016, hired within the incentive period an employee who
28	28	16 had participated as worker-trainee in the Put Illinois to
29	29	17 Work Program during 2010.
30	30	18 In the case of any person that is a member of a unitary
31	31	19 business group within the meaning of subdivision (a)(27) of
32	32	20 Section 1501 of the Illinois Income Tax Act, "applicant"
33	33	21 refers to the unitary business group.
34	34	22 "Certificate" means the tax credit certificate issued by
35	35	23 the Department under Section 35 of this Act.
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39	39	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1505 Introduced 2/4/2025, by Sen. Willie Preston SYNOPSIS AS INTRODUCED:
40	40	35 ILCS 25/1035 ILCS 25/2535 ILCS 25/35 35 ILCS 25/10 35 ILCS 25/25 35 ILCS 25/35
41	41	35 ILCS 25/10
42	42	35 ILCS 25/25
43	43	35 ILCS 25/35
44	44	Amends the Small Business Job Creation Tax Credit Act. Renews the program for incentive periods beginning on or after July 1, 2025 and ending on or before June 30, 2032. Removes language concerning the Put Illinois to Work Program for the second series of incentive periods. Provides that the term "full-time employee" means an individual who is employed for a basic wage for at least 35 hours each week (currently, employed for a basic wage for at least 35 hours each week or renders any other standard of service generally accepted by industry custom or practice as full-time employment). Provides that a net increase in the number of full-time Illinois employees shall be treated as continuous if a different new employee is hired as a replacement within 8 weeks after the position becomes vacant (currently, a reasonable time). Effective immediately.
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46	46	LRB104 07601 HLH 17645 b
47	47	A BILL FOR
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55	55	35 ILCS 25/35
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74	74	1 "Certificate of eligibility" means the certificate issued
75	75	2 by the Department under Section 20 of this Act.
76	76	3 "Credit" means the amount awarded by the Department to an
77	77	4 applicant by issuance of a certificate under Section 35 of
78	78	5 this Act for each new full-time equivalent employee hired or
79	79	6 job created.
80	80	7 "Department" means the Department of Commerce and Economic
81	81	8 Opportunity.
82	82	9 "Director" means the Director of the Department.
83	83	10 "Full-time employee" means an individual who is employed
84	84	11 for a basic wage for at least 35 hours each week or who renders
85	85	12 any other standard of service generally accepted by industry
86	86	13 custom or practice as full-time employment. An individual for
87	87	14 whom a W-2 is issued by a Professional Employer Organization
88	88	15 is a full-time employee if he or she is employed in the service
89	89	16 of the applicant for a basic wage for at least 35 hours each
90	90	17 week or renders any other standard of service generally
91	91	18 accepted by industry custom or practice as full-time
92	92	19 employment. For the purposes of this Act, such an individual
93	93	20 shall be considered a full-time employee of the applicant.
94	94	21 "Professional Employer Organization" (PEO) shall have the
95	95	22 same meaning as defined in Section 5-5 of the Economic
96	96	23 Development for a Growing Economy Tax Credit Act. As used in
97	97	24 this Section, "Professional Employer Organization" does not
98	98	25 include a day and temporary labor service agency regulated
99	99	26 under the Day and Temporary Labor Services Act.
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110	110	1 "Incentive period" means the period beginning on July 1
111	111	2 and ending on June 30 of the following year. The first series
112	112	3 of incentive periods period shall begin on July 1, 2010 and the
113	113	4 last incentive period shall end on June 30, 2016. The second
114	114	5 series of incentive periods shall begin on July 1, 2025 and end
115	115	6 on June 30, 2032.
116	116	7 "Basic wage" means compensation for employment that is no
117	117	8 less than $10 per hour or the equivalent salary for a new
118	118	9 employee.
119	119	10 "New employee" means a full-time employee who first became
120	120	11 employed by an applicant with less than 50 full-time employees
121	121	12 within the incentive period, whose hire results in a net
122	122	13 increase in the applicant's full-time Illinois employees, and
123	123	14 who is receiving a basic wage as compensation. :
124	124	15 (1) who first became employed by an applicant with
125	125	16 less than 50 full-time employees within the incentive
126	126	17 period whose hire results in a net increase in the
127	127	18 applicant's full-time Illinois employees and who is
128	128	19 receiving a basic wage as compensation; or
129	129	20 (2) who participated as a worker-trainee in the Put
130	130	21 Illinois to Work Program during 2010 and who is
131	131	22 subsequently hired during the incentive period by an
132	132	23 applicant and who is receiving a basic wage as
133	133	24 compensation.
134	134	25 The term "new employee" does not include:
135	135	26 (1) a person who was previously employed in Illinois
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146	146	1 by the applicant or a related member prior to the onset of
147	147	2 the incentive period; or
148	148	3 (2) any individual who has a direct or indirect
149	149	4 ownership interest of at least 5% in the profits, capital,
150	150	5 or value of the applicant or a related member.
151	151	6 "Noncompliance date" means, in the case of an applicant
152	152	7 that is not complying with the requirements of the provisions
153	153	8 of this Act, the day following the last date upon which the
154	154	9 taxpayer was in compliance with the requirements of the
155	155	10 provisions of this Act, as determined by the Director,
156	156	11 pursuant to Section 45 of this Act.
157	157	12 "Put Illinois to Work Program" means a worker training and
158	158	13 employment program that was established by the State of
159	159	14 Illinois with funding from the United States Department of
160	160	15 Health and Human Services of Emergency Temporary Assistance
161	161	16 for Needy Families funds authorized by the American Recovery
162	162	17 and Reinvestment Act of 2009 (ARRA TANF Funds). These ARRA
163	163	18 TANF funds were in turn used by the State of Illinois to fund
164	164	19 the Put Illinois to Work Program.
165	165	20 "Related member" means a person that, with respect to the
166	166	21 applicant during any portion of the incentive period, is any
167	167	22 one of the following,
168	168	23 (1) An individual, if the individual and the members
169	169	24 of the individual's family (as defined in Section 318 of
170	170	25 the Internal Revenue Code) own directly, indirectly,
171	171	26 beneficially, or constructively, in the aggregate, at
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182	182	1 least 50% of the value of the outstanding profits,
183	183	2 capital, stock, or other ownership interest in the
184	184	3 applicant.
185	185	4 (2) A partnership, estate, or trust and any partner or
186	186	5 beneficiary, if the partnership, estate, or trust and its
187	187	6 partners or beneficiaries own directly, indirectly,
188	188	7 beneficially, or constructively, in the aggregate, at
189	189	8 least 50% of the profits, capital, stock, or other
190	190	9 ownership interest in the applicant.
191	191	10 (3) A corporation, and any party related to the
192	192	11 corporation in a manner that would require an attribution
193	193	12 of stock from the corporation under the attribution rules
194	194	13 of Section 318 of the Internal Revenue Code, if the
195	195	14 applicant and any other related member own, in the
196	196	15 aggregate, directly, indirectly, beneficially, or
197	197	16 constructively, at least 50% of the value of the
198	198	17 corporation's outstanding stock.
199	199	18 (4) A corporation and any party related to that
200	200	19 corporation in a manner that would require an attribution
201	201	20 of stock from the corporation to the party or from the
202	202	21 party to the corporation under the attribution rules of
203	203	22 Section 318 of the Internal Revenue Code, if the
204	204	23 corporation and all such related parties own, in the
205	205	24 aggregate, at least 50% of the profits, capital, stock, or
206	206	25 other ownership interest in the applicant.
207	207	26 (5) A person to or from whom there is attribution of
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218	218	1 stock ownership in accordance with Section 1563(e) of the
219	219	2 Internal Revenue Code, except that for purposes of
220	220	3 determining whether a person is a related member under
221	221	4 this paragraph, "20%" shall be substituted for "5%"
222	222	5 whenever "5%" appears in Section 1563(e) of the Internal
223	223	6 Revenue Code.
224	224	7 (Source: P.A. 100-863, eff. 8-14-18.)
225	225	8 (35 ILCS 25/25)
226	226	9 Sec. 25. Tax credit.
227	227	10 (a) Subject to the conditions set forth in this Act, an
228	228	11 applicant is entitled to a credit against payment of taxes
229	229	12 withheld under Section 704A of the Illinois Income Tax Act:
230	230	13 (1) for new employees who participated as
231	231	14 worker-trainees in the Put Illinois to Work Program during
232	232	15 2010, for incentive periods ending on or before June 30,
233	233	16 2016:
234	234	17 (A) in the first calendar year ending on or after
235	235	18 the date that is 6 months after December 31, 2010, or
236	236	19 the date of hire, whichever is later. Under this
237	237	20 subparagraph, the applicant is entitled to one-half of
238	238	21 the credit allowable for each new employee who is
239	239	22 employed for at least 6 months after the date of hire;
240	240	23 and
241	241	24 (B) in the first calendar year ending on or after
242	242	25 the date that is 12 months after December 31, 2010, or
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253	253	1 the date of hire, whichever is later. Under this
254	254	2 subparagraph, the applicant is entitled to one-half of
255	255	3 the credit allowable for each new employee who is
256	256	4 employed for at least 12 months after the date of hire;
257	257	5 (2) for all other new employees, in the first
258	258	6 calendar year ending on or after the date that is 12 months
259	259	7 after the date of hire of a new employee. The credit shall
260	260	8 be allowed as a credit to an applicant for each full-time
261	261	9 employee hired during the incentive period that results in
262	262	10 a net increase in full-time Illinois employees, where the
263	263	11 net increase in the employer's full-time Illinois
264	264	12 employees is maintained for at least 12 months.
265	265	13 (b) The Department shall make credit awards under this Act
266	266	14 to further job creation.
267	267	15 (c) The credit shall be claimed for the first calendar
268	268	16 year ending on or after the date on which the certificate is
269	269	17 issued by the Department.
270	270	18 (d) The credit shall not exceed $2,500 per new employee
271	271	19 hired.
272	272	20 (e) The net increase in full-time Illinois employees,
273	273	21 measured on an annual full-time equivalent basis, shall be the
274	274	22 total number of full-time Illinois employees of the applicant
275	275	23 on the final day of the incentive period, minus the number of
276	276	24 full-time Illinois employees employed by the employer on the
277	277	25 first day of that same incentive period. For purposes of the
278	278	26 calculation, an employer that begins doing business in this
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289	289	1 State during the incentive period, as determined by the
290	290	2 Director, shall be treated as having zero Illinois employees
291	291	3 on the first day of the incentive period.
292	292	4 (f) The net increase in the number of full-time Illinois
293	293	5 employees of the applicant under subsection (e) must be
294	294	6 sustained continuously for at least 12 months, starting with
295	295	7 the date of hire of a new employee during the incentive period.
296	296	8 Eligibility for the credit does not depend on the continuous
297	297	9 employment of any particular individual. For purposes of this
298	298	10 subsection (f), if a new employee ceases to be employed before
299	299	11 the completion of the 12-month period for any reason, the net
300	300	12 increase in the number of full-time Illinois employees shall
301	301	13 be treated as continuous if a different new employee is hired
302	302	14 as a replacement within a reasonable time for the same
303	303	15 position within 8 weeks after the position becomes vacant.
304	304	16 (g) The Department shall promulgate rules to enable an
305	305	17 applicant for which a PEO has been contracted to issue W-2s and
306	306	18 make payment of taxes withheld under Section 704A of the
307	307	19 Illinois Income Tax Act for new employees to retain the
308	308	20 benefit of tax credits to which the applicant is otherwise
309	309	21 entitled under this Act.
310	310	22 (Source: P.A. 96-888, eff. 4-13-10; 96-1498, eff. 1-18-11;
311	311	23 97-636, eff. 6-1-12; 97-1052, eff. 8-23-12.)
312	312	24 (35 ILCS 25/35)
313	313	25 Sec. 35. Application for award of tax credit; tax credit
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324	324	1 certificate.
325	325	2 (a) On or after the conclusion of the 12-month period (or
326	326	3 6-month period, for purposes of subparagraph (A) of item (1)
327	327	4 of subsection (a) of Section 25) after a new employee has been
328	328	5 hired, an applicant shall file with the Department an
329	329	6 application for award of a credit. The application shall
330	330	7 include the following:
331	331	8 (1) The names, Social Security numbers, job
332	332	9 descriptions, salary or wage rates, and dates of hire of
333	333	10 the new employees with respect to whom the credit is being
334	334	11 requested, and an indication of whether each new employee
335	335	12 listed participated as a worker-trainee in the Put
336	336	13 Illinois to Work Program.
337	337	14 (2) A certification that each new employee listed has
338	338	15 been retained on the job for one year (or 6 months, for
339	339	16 purposes of subparagraph (A) of item (1) of subsection (a)
340	340	17 of Section 25) from the date of hire.
341	341	18 (3) The number of new employees hired by the applicant
342	342	19 during the incentive period.
343	343	20 (4) The net increase in the number of full-time
344	344	21 Illinois employees of the applicant (including the new
345	345	22 employees listed in the request) between the beginning of
346	346	23 the incentive period and the dates on which the new
347	347	24 employees listed in the request were hired. This
348	348	25 requirement does not apply for tax credits the applicant
349	349	26 is seeking because the new employee had participated as a
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360	360	1 worker-trainee in the Put Illinois to Work Program.
361	361	2 (5) An agreement that the Director is authorized to
362	362	3 verify with the appropriate State agencies the information
363	363	4 contained in the request before issuing a certificate to
364	364	5 the applicant.
365	365	6 (6) Any other information the Department determines to
366	366	7 be appropriate.
367	367	8 (b) Although an application may be filed at any time after
368	368	9 the conclusion of the 12-month period (or 6-month period, for
369	369	10 purposes of subparagraph (A) of item (1) of subsection (a) of
370	370	11 Section 25) after a new employee was hired, an application
371	371	12 filed more than 90 days after the earliest date on which it
372	372	13 could have been filed shall not be awarded any credit if, prior
373	373	14 to the date it is filed, the Department has received
374	374	15 applications under this Section for credits totaling more than
375	375	16 $50,000,000.
376	376	17 (c) The Department shall issue a certificate to each
377	377	18 applicant awarded a credit under this Act. The certificate
378	378	19 shall include the following:
379	379	20 (1) The name and taxpayer identification number of the
380	380	21 applicant.
381	381	22 (2) The date on which the certificate is issued.
382	382	23 (3) The credit amount that will be allowed.
383	383	24 (4) Any other information the Department determines to
384	384	25 be appropriate.
385	385	26 (Source: P.A. 96-888, eff. 4-13-10; 96-1498, eff. 1-18-11.)
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