SB0115 99TH GENERAL ASSEMBLY

LRB099 05637 HLH 25676 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB0115

Introduced 1/28/2015, by Sen. Jennifer Bertino-Tarrant

SYNOPSIS AS INTRODUCED:

35 ILCS 5/224 new

Amends the Illinois Income Tax Act. Provides that each taxpayer who employs a long-term unemployed person during the taxable year is entitled to an income tax credit of: (1) $500 in the taxable year in which the long-term unemployed person is initially hired by the taxpayer; (2) $750 in the first taxable year after the long-term unemployed person is initially hired by the taxpayer; and (3) $1,250 in the second taxable year after the long-term unemployed person is initially hired by the taxpayer. Provides that the taxpayer may receive a partial credit if the person is employed by the taxpayer for only part of a taxable year. Provides that the credit may be carried forward. Provides that the credit is exempt from the Act's automatic sunset provisions. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Income Tax Act is amended by adding Section 224 as follows:

(35 ILCS 5/224 new)

Sec. 224. Credit for hiring a long-term unemployed person.

(a) For each taxable year beginning on or after January 1, 2016, each taxpayer who employs a long-term unemployed person during the taxable year is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act as provided in this Section. The amount of the credit is as follows: (1) $500 in the taxable year in which the long-term unemployed person is initially hired by the taxpayer; (2) $750 in the first taxable year after the long-term unemployed person is initially hired by the taxpayer; and (3) $1,250 in the second taxable year after the long-term unemployed person is initially hired by the taxpayer. If the long-term unemployed person is employed by the taxpayer for only part of a taxable year, then the amount of the credit shall be the maximum credit allowed under this subsection (a) for the taxable year, multiplied by a fraction, the numerator of which is the number of weeks during the taxable year in which the person is employed by the taxpayer, and the denominator of which shall be the total number of weeks in the taxable year.

(b) For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this Section to be determined in accordance with the determination of income and distributive share of income under Sections 702 and 704 and Subchapter S of the Internal Revenue Code.

(c) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.

(d) For the purposes of this Section:

"Long-term unemployed person" means an individual who:

(1) was unemployed for a period of at least 27 consecutive weeks ending on the Saturday immediately preceding the date he or she was hired by the taxpayer;

(2) was an Illinois resident on the date he or she was hired by the taxpayer;

(3) is employed by the taxpayer during the taxable year as a full-time employee; and

(4) was not enrolled as a full-time student at a public or private high school, community college, or university at any point during the 27-week period immediately preceding the date he or she was hired by the taxpayer.

"Full-time employee" means an individual who is employed for a wage of at least $10 per hour for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full-time employment. An individual for whom a W-2 is issued by a Professional Employer Organization is a full-time employee if he or she is employed in the service of the taxpayer for a wage of at least $10 per hour 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.

(e) This Section is exempt from the provisions of Section 250.

Section 99. Effective date. This Act takes effect upon becoming law.