Illinois 2025-2026 Regular Session

Illinois Senate Bill SB1745 Compare Versions

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

Old	New	Differences
1	1	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1745 Introduced 2/5/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that the term "Illinois labor expenditure" does not include: (1) above-the-line spending exceeding 40% of the total Illinois production spending for the production, unless the Department of Commerce and Economic Opportunity determines that the inclusion of such excess above-the-line spending is necessary for the production to be accredited; (2) above-the-line spending paid to related parties that exceeds, in the aggregate, 12% of the total Illinois production spending for the production; or (3) below-the-line spending paid to a related party that exceeds the fair market value of the transaction. Defines "above-the-line spending" and "below-the-line spending". Provides that the term "Illinois production spending" includes the fair market value of any transaction that (i) is entered into between the taxpayer and a related party or the taxpayer and an unrelated party, (ii) is related to the accredited production, and (iii) has terms that reflect the fair market value of the transaction. LRB104 10921 HLH 21003 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1745 Introduced 2/5/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 35 ILCS 16/10 35 ILCS 16/10 Amends the Film Production Services Tax Credit Act of 2008. Provides that the term "Illinois labor expenditure" does not include: (1) above-the-line spending exceeding 40% of the total Illinois production spending for the production, unless the Department of Commerce and Economic Opportunity determines that the inclusion of such excess above-the-line spending is necessary for the production to be accredited; (2) above-the-line spending paid to related parties that exceeds, in the aggregate, 12% of the total Illinois production spending for the production; or (3) below-the-line spending paid to a related party that exceeds the fair market value of the transaction. Defines "above-the-line spending" and "below-the-line spending". Provides that the term "Illinois production spending" includes the fair market value of any transaction that (i) is entered into between the taxpayer and a related party or the taxpayer and an unrelated party, (ii) is related to the accredited production, and (iii) has terms that reflect the fair market value of the transaction. LRB104 10921 HLH 21003 b LRB104 10921 HLH 21003 b A BILL FOR
2	2	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1745 Introduced 2/5/2025, by Sen. Cristina Castro 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 the term "Illinois labor expenditure" does not include: (1) above-the-line spending exceeding 40% of the total Illinois production spending for the production, unless the Department of Commerce and Economic Opportunity determines that the inclusion of such excess above-the-line spending is necessary for the production to be accredited; (2) above-the-line spending paid to related parties that exceeds, in the aggregate, 12% of the total Illinois production spending for the production; or (3) below-the-line spending paid to a related party that exceeds the fair market value of the transaction. Defines "above-the-line spending" and "below-the-line spending". Provides that the term "Illinois production spending" includes the fair market value of any transaction that (i) is entered into between the taxpayer and a related party or the taxpayer and an unrelated party, (ii) is related to the accredited production, and (iii) has terms that reflect the fair market value of the transaction.
6	6	LRB104 10921 HLH 21003 b LRB104 10921 HLH 21003 b
7	7	LRB104 10921 HLH 21003 b
8	8	A BILL FOR
9	9	SB1745LRB104 10921 HLH 21003 b SB1745 LRB104 10921 HLH 21003 b
10	10	SB1745 LRB104 10921 HLH 21003 b
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 "Above-the-line spending" means all salary, wages, fees,
19	19	9 and fringe benefits paid for services performed by personnel
20	20	10 of the production that are considered above-the-line services
21	21	11 in the film and television industry, including, but not
22	22	12 limited to, services performed by a producer, executive
23	23	13 producer, co-producer, director, screenwriter, lead cast,
24	24	14 supporting cast, or day player.
25	25	15 "Accredited production" means: (i) for productions
26	26	16 commencing before May 1, 2006, a film, video, or television
27	27	17 production that has been certified by the Department in which
28	28	18 the aggregate Illinois labor expenditures included in the cost
29	29	19 of the production, in the period that ends 12 months after the
30	30	20 time principal filming or taping of the production began,
31	31	21 exceed $100,000 for productions of 30 minutes or longer, or
32	32	22 $50,000 for productions of less than 30 minutes; and (ii) for
33	33	23 productions commencing on or after May 1, 2006, a film, video,
34	34
35	35
36	36
37	37	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1745 Introduced 2/5/2025, by Sen. Cristina Castro 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 the term "Illinois labor expenditure" does not include: (1) above-the-line spending exceeding 40% of the total Illinois production spending for the production, unless the Department of Commerce and Economic Opportunity determines that the inclusion of such excess above-the-line spending is necessary for the production to be accredited; (2) above-the-line spending paid to related parties that exceeds, in the aggregate, 12% of the total Illinois production spending for the production; or (3) below-the-line spending paid to a related party that exceeds the fair market value of the transaction. Defines "above-the-line spending" and "below-the-line spending". Provides that the term "Illinois production spending" includes the fair market value of any transaction that (i) is entered into between the taxpayer and a related party or the taxpayer and an unrelated party, (ii) is related to the accredited production, and (iii) has terms that reflect the fair market value of the transaction.
41	41	LRB104 10921 HLH 21003 b LRB104 10921 HLH 21003 b
42	42	LRB104 10921 HLH 21003 b
43	43	A BILL FOR
44	44
45	45
46	46
47	47
48	48
49	49	35 ILCS 16/10
50	50
51	51
52	52
53	53	LRB104 10921 HLH 21003 b
54	54
55	55
56	56
57	57
58	58
59	59
60	60
61	61
62	62
63	63	SB1745 LRB104 10921 HLH 21003 b
64	64
65	65
66	66	SB1745- 2 -LRB104 10921 HLH 21003 b SB1745 - 2 - LRB104 10921 HLH 21003 b
67	67	SB1745 - 2 - LRB104 10921 HLH 21003 b
68	68	1 or television production that has been certified by the
69	69	2 Department in which the Illinois production spending included
70	70	3 in the cost of production in the period that ends 12 months
71	71	4 after the time principal filming or taping of the production
72	72	5 began exceeds $100,000 for productions of 30 minutes or longer
73	73	6 or exceeds $50,000 for productions of less than 30 minutes.
74	74	7 "Accredited production" does not include a production that:
75	75	8 (1) is news, current events, or public programming, or
76	76	9 a program that includes weather or market reports;
77	77	10 (2) is a talk show produced for local or regional
78	78	11 markets;
79	79	12 (3) (blank);
80	80	13 (4) is a sports event or activity;
81	81	14 (5) is a gala presentation or awards show;
82	82	15 (6) is a finished production that solicits funds;
83	83	16 (7) is a production produced by a film production
84	84	17 company if records, as required by 18 U.S.C. 2257, are to
85	85	18 be maintained by that film production company with respect
86	86	19 to any performer portrayed in that single media or
87	87	20 multimedia program; or
88	88	21 (8) is a production produced primarily for industrial,
89	89	22 corporate, or institutional purposes.
90	90	23 "Accredited animated production" means an accredited
91	91	24 production in which movement and characters' performances are
92	92	25 created using a frame-by-frame technique and a significant
93	93	26 number of major characters are animated. Motion capture by
94	94
95	95
96	96
97	97
98	98
99	99	SB1745 - 2 - LRB104 10921 HLH 21003 b
100	100
101	101
102	102	SB1745- 3 -LRB104 10921 HLH 21003 b SB1745 - 3 - LRB104 10921 HLH 21003 b
103	103	SB1745 - 3 - LRB104 10921 HLH 21003 b
104	104	1 itself is not an animation technique.
105	105	2 "Accredited production certificate" means a certificate
106	106	3 issued by the Department certifying that the production is an
107	107	4 accredited production that meets the guidelines of this Act.
108	108	5 "Applicant" means a taxpayer that is a film production
109	109	6 company that is operating or has operated an accredited
110	110	7 production located within the State of Illinois and that (i)
111	111	8 owns the copyright in the accredited production throughout the
112	112	9 Illinois production period or (ii) has contracted directly
113	113	10 with the owner of the copyright in the accredited production
114	114	11 or a person acting on behalf of the owner to provide services
115	115	12 for the production, where the owner of the copyright is not an
116	116	13 eligible production corporation.
117	117	14 "Below-the-line spending" means salary, wages, fees, and
118	118	15 fringe benefits paid for services performed by a person in a
119	119	16 position that is off camera and who provides technical
120	120	17 services during the physical production of a film.
121	121	18 "Below-the-line spending" does not include salary, wages,
122	122	19 fees, or fringe benefits paid to a person who is a producer,
123	123	20 executive producer, co-producer, director, screenwriter, lead
124	124	21 cast, supporting cast, or day player, or who performs other
125	125	22 services that are customarily considered above-the-line
126	126	23 services in the film and television industry.
127	127	24 "Credit" means:
128	128	25 (1) for an accredited production approved by the
129	129	26 Department on or before January 1, 2005 and commencing
130	130
131	131
132	132
133	133
134	134
135	135	SB1745 - 3 - LRB104 10921 HLH 21003 b
136	136
137	137
138	138	SB1745- 4 -LRB104 10921 HLH 21003 b SB1745 - 4 - LRB104 10921 HLH 21003 b
139	139	SB1745 - 4 - LRB104 10921 HLH 21003 b
140	140	1 before May 1, 2006, the amount equal to 25% of the Illinois
141	141	2 labor expenditure approved by the Department. The
142	142	3 applicant is deemed to have paid, on its balance due day
143	143	4 for the year, an amount equal to 25% of its qualified
144	144	5 Illinois labor expenditure for the tax year. For Illinois
145	145	6 labor expenditures generated by the employment of
146	146	7 residents of geographic areas of high poverty or high
147	147	8 unemployment, as determined by the Department, in an
148	148	9 accredited production commencing before May 1, 2006 and
149	149	10 approved by the Department after January 1, 2005, the
150	150	11 applicant shall receive an enhanced credit of 10% in
151	151	12 addition to the 25% credit; and
152	152	13 (2) for an accredited production commencing on or
153	153	14 after May 1, 2006 and before January 1, 2009, the amount
154	154	15 equal to:
155	155	16 (i) 20% 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; and
161	161	22 (3) for an accredited production commencing on or
162	162	23 after January 1, 2009, the amount equal to:
163	163	24 (i) 30% of the Illinois production spending for
164	164	25 the taxable year; plus
165	165	26 (ii) 15% of the Illinois labor expenditures
166	166
167	167
168	168
169	169
170	170
171	171	SB1745 - 4 - LRB104 10921 HLH 21003 b
172	172
173	173
174	174	SB1745- 5 -LRB104 10921 HLH 21003 b SB1745 - 5 - LRB104 10921 HLH 21003 b
175	175	SB1745 - 5 - LRB104 10921 HLH 21003 b
176	176	1 generated by the employment of residents of geographic
177	177	2 areas of high poverty or high unemployment, as
178	178	3 determined by the Department.
179	179	4 "Department" means the Department of Commerce and Economic
180	180	5 Opportunity.
181	181	6 "Director" means the Director of Commerce and Economic
182	182	7 Opportunity.
183	183	8 "Fair market value" means:
184	184	9 (1) for unrelated parties, the value established
185	185	10 through comparable transactions between unrelated parties
186	186	11 for substantially similar goods and services considering
187	187	12 the geographic market and other pertinent variables as
188	188	13 specified by the Department by rule; and
189	189	14 (2) for related parties, the value established through
190	190	15 the related party's historical dealings with unrelated
191	191	16 parties or established by comparable transactions between
192	192	17 other unrelated parties for substantially similar goods
193	193	18 and services considering the geographic market and other
194	194	19 pertinent variables as specified by the Department by
195	195	20 rule.
196	196	21 "Illinois labor expenditure" means salary or wages paid to
197	197	22 employees of the applicant for services on the accredited
198	198	23 production.
199	199	24 To qualify as an Illinois labor expenditure, the
200	200	25 expenditure must be:
201	201	26 (1) Reasonable in the circumstances.
202	202
203	203
204	204
205	205
206	206
207	207	SB1745 - 5 - LRB104 10921 HLH 21003 b
208	208
209	209
210	210	SB1745- 6 -LRB104 10921 HLH 21003 b SB1745 - 6 - LRB104 10921 HLH 21003 b
211	211	SB1745 - 6 - LRB104 10921 HLH 21003 b
212	212	1 (2) Included in the federal income tax basis of the
213	213	2 property.
214	214	3 (3) Incurred by the applicant for services on or after
215	215	4 January 1, 2004.
216	216	5 (4) Incurred for the production stages of the
217	217	6 accredited production, from the final script stage to the
218	218	7 end of the post-production stage.
219	219	8 (5) Limited to the first $25,000 of wages paid or
220	220	9 incurred to each employee of a production commencing
221	221	10 before May 1, 2006 and the first $100,000 of wages paid or
222	222	11 incurred to each employee of a production commencing on or
223	223	12 after May 1, 2006 and prior to July 1, 2022. For
224	224	13 productions commencing on or after July 1, 2022, limited
225	225	14 to the first $500,000 of wages paid or incurred to each
226	226	15 eligible nonresident or resident employee of a production
227	227	16 company or loan out company that provides in-State
228	228	17 services to a production, whether those wages are paid or
229	229	18 incurred by the production company, loan out company, or
230	230	19 both, subject to withholding payments provided for in
231	231	20 Article 7 of the Illinois Income Tax Act. For purposes of
232	232	21 calculating Illinois labor expenditures for a television
233	233	22 series, the eligible nonresident wage limitations provided
234	234	23 under this subparagraph are applied to the entire season.
235	235	24 For the purpose of this paragraph (5), an eligible
236	236	25 nonresident is a nonresident whose wages qualify as an
237	237	26 Illinois labor expenditure under the provisions of
238	238
239	239
240	240
241	241
242	242
243	243	SB1745 - 6 - LRB104 10921 HLH 21003 b
244	244
245	245
246	246	SB1745- 7 -LRB104 10921 HLH 21003 b SB1745 - 7 - LRB104 10921 HLH 21003 b
247	247	SB1745 - 7 - LRB104 10921 HLH 21003 b
248	248	1 paragraph (9) that apply to that production.
249	249	2 (6) For a production commencing before May 1, 2006,
250	250	3 exclusive of the salary or wages paid to or incurred for
251	251	4 the 2 highest paid employees of the production.
252	252	5 (7) Directly attributable to the accredited
253	253	6 production.
254	254	7 (8) (Blank).
255	255	8 (9) Prior to July 1, 2022, paid to persons resident in
256	256	9 Illinois at the time the payments were made. For a
257	257	10 production commencing on or after July 1, 2022, paid to
258	258	11 persons resident in Illinois and nonresidents at the time
259	259	12 the payments were made.
260	260	13 For purposes of this subparagraph, if the production
261	261	14 is accredited by the Department before the effective date
262	262	15 of this amendatory Act of the 102nd General Assembly, only
263	263	16 wages paid to nonresidents working in the following
264	264	17 positions shall be considered Illinois labor expenditures:
265	265	18 Writer, Director, Director of Photography, Production
266	266	19 Designer, Costume Designer, Production Accountant, VFX
267	267	20 Supervisor, Editor, Composer, and Actor, subject to the
268	268	21 limitations set forth under this subparagraph. For an
269	269	22 accredited Illinois production spending of $25,000,000 or
270	270	23 less, no more than 2 nonresident actors' wages shall
271	271	24 qualify as an Illinois labor expenditure. For an
272	272	25 accredited production with Illinois production spending of
273	273	26 more than $25,000,000, no more than 4 nonresident actor's
274	274
275	275
276	276
277	277
278	278
279	279	SB1745 - 7 - LRB104 10921 HLH 21003 b
280	280
281	281
282	282	SB1745- 8 -LRB104 10921 HLH 21003 b SB1745 - 8 - LRB104 10921 HLH 21003 b
283	283	SB1745 - 8 - LRB104 10921 HLH 21003 b
284	284	1 wages shall qualify as Illinois labor expenditures.
285	285	2 For purposes of this subparagraph, if the production
286	286	3 is accredited by the Department on or after the effective
287	287	4 date of this amendatory Act of the 102nd General Assembly,
288	288	5 wages paid to nonresidents shall qualify as Illinois labor
289	289	6 expenditures only under the following conditions:
290	290	7 (A) the nonresident must be employed in a
291	291	8 qualified position;
292	292	9 (B) for each of those accredited productions, the
293	293	10 wages of not more than 9 nonresidents who are employed
294	294	11 in a qualified position other than Actor shall qualify
295	295	12 as Illinois labor expenditures;
296	296	13 (C) for an accredited production with Illinois
297	297	14 production spending of $25,000,000 or less, no more
298	298	15 than 2 nonresident actors' wages shall qualify as
299	299	16 Illinois labor expenditures; and
300	300	17 (D) for an accredited production with Illinois
301	301	18 production spending of more than $25,000,000, no more
302	302	19 than 4 nonresident actors' wages shall qualify as
303	303	20 Illinois labor expenditures.
304	304	21 As used in this paragraph (9), "qualified position"
305	305	22 means: Writer, Director, Director of Photography,
306	306	23 Production Designer, Costume Designer, Production
307	307	24 Accountant, VFX Supervisor, Editor, Composer, or Actor.
308	308	25 (10) Paid for services rendered in Illinois.
309	309	26 For a production commencing on or after the effective date
310	310
311	311
312	312
313	313
314	314
315	315	SB1745 - 8 - LRB104 10921 HLH 21003 b
316	316
317	317
318	318	SB1745- 9 -LRB104 10921 HLH 21003 b SB1745 - 9 - LRB104 10921 HLH 21003 b
319	319	SB1745 - 9 - LRB104 10921 HLH 21003 b
320	320	1 of this amendatory Act of the 104th General Assembly,
321	321	2 "Illinois labor expenditure" does not include:
322	322	3 (1) above-the-line spending exceeding 40% of the total
323	323	4 Illinois production spending for the production, unless
324	324	5 the Department determines, through a process specified by
325	325	6 administrative rule, that inclusion as an Illinois labor
326	326	7 expenditure of above-the-line spending for the production
327	327	8 in an amount that exceeds 40% of the production's total
328	328	9 Illinois production spending is necessary for the
329	329	10 production to meet the conditions set forth in subsection
330	330	11 (a) of Section 30;
331	331	12 (2) above-the-line spending paid to related parties
332	332	13 that exceeds, in the aggregate, 12% of the total Illinois
333	333	14 production spending for the production; or
334	334	15 (3) below-the-line spending paid to a related party
335	335	16 that exceeds the fair market value of the transaction.
336	336	17 "Illinois production spending" means the expenses incurred
337	337	18 by the applicant for an accredited production that are
338	338	19 reasonable under the circumstances, but does not include any
339	339	20 monetary prize or the cost of any non-monetary prize awarded
340	340	21 pursuant to a production in respect of a game, questionnaire,
341	341	22 or contest. "Illinois production spending" includes, without
342	342	23 limitation, unless otherwise specified in this definition, all
343	343	24 of the following:
344	344	25 (1) expenses to purchase, from vendors within
345	345	26 Illinois, tangible personal property that is used in the
346	346
347	347
348	348
349	349
350	350
351	351	SB1745 - 9 - LRB104 10921 HLH 21003 b
352	352
353	353
354	354	SB1745- 10 -LRB104 10921 HLH 21003 b SB1745 - 10 - LRB104 10921 HLH 21003 b
355	355	SB1745 - 10 - LRB104 10921 HLH 21003 b
356	356	1 accredited production;
357	357	2 (2) expenses to acquire services, from vendors in
358	358	3 Illinois, for film production, editing, or processing; and
359	359	4 (3) for a production commencing before July 1, 2022,
360	360	5 the compensation, not to exceed $100,000 for any one
361	361	6 employee, for contractual or salaried employees who are
362	362	7 Illinois residents performing services with respect to the
363	363	8 accredited production. For a production commencing on or
364	364	9 after July 1, 2022, Illinois labor expenditure the
365	365	10 compensation, not to exceed $500,000 for any one employee,
366	366	11 for contractual or salaried employees who are Illinois
367	367	12 residents or nonresident employees, subject to the
368	368	13 limitations set forth under Section 10 of this Act; and .
369	369	14 (4) for a production commencing on or after the
370	370	15 effective date of this amendatory Act of the 104th General
371	371	16 Assembly, the fair market value of any transaction that
372	372	17 (i) is entered into between the taxpayer and a related
373	373	18 party or the taxpayer and an unrelated party, (ii) is for
374	374	19 the accredited production, and (iii) has terms that
375	375	20 reflect the fair market value of the transaction.
376	376	21 "Loan out company" means a personal service corporation or
377	377	22 other entity that is under contract with the taxpayer to
378	378	23 provide specified individual personnel, such as artists, crew,
379	379	24 actors, producers, or directors for the performance of
380	380	25 services used directly in a production. "Loan out company"
381	381	26 does not include entities contracted with by the taxpayer to
382	382
383	383
384	384
385	385
386	386
387	387	SB1745 - 10 - LRB104 10921 HLH 21003 b
388	388
389	389
390	390	SB1745- 11 -LRB104 10921 HLH 21003 b SB1745 - 11 - LRB104 10921 HLH 21003 b
391	391	SB1745 - 11 - LRB104 10921 HLH 21003 b
392	392
393	393
394	394
395	395
396	396
397	397	SB1745 - 11 - LRB104 10921 HLH 21003 b