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91_SB0878ccr001
LRB9105091PTmbccr2
1 91ST GENERAL ASSEMBLY
2 CONFERENCE COMMITTEE REPORT
3 ON SENATE BILL 878
4 -------------------------------------------------------------
5 -------------------------------------------------------------
6 To the President of the Senate and the Speaker of the
7 House of Representatives:
8 We, the conference committee appointed to consider the
9 differences between the houses in relation to House Amendment
10 No. 1 to Senate Bill 878, recommend the following:
11 (1) that the Senate concur in House Amendment No. 1; and
12 (2) that Senate Bill 878 be further amended, AS AMENDED,
13 by replacing everything after the enacting clause with the
14 following:
15 "Section 3. The Illinois Income Tax Act is amended by
16 changing Section 201 as follows:
17 (35 ILCS 5/201) (from Ch. 120, par. 2-201)
18 Sec. 201. Tax Imposed.
19 (a) In general. A tax measured by net income is hereby
20 imposed on every individual, corporation, trust and estate
21 for each taxable year ending after July 31, 1969 on the
22 privilege of earning or receiving income in or as a resident
23 of this State. Such tax shall be in addition to all other
24 occupation or privilege taxes imposed by this State or by any
25 municipal corporation or political subdivision thereof.
26 (b) Rates. The tax imposed by subsection (a) of this
27 Section shall be determined as follows:
28 (1) In the case of an individual, trust or estate,
29 for taxable years ending prior to July 1, 1989, an amount
30 equal to 2 1/2% of the taxpayer's net income for the
31 taxable year.
32 (2) In the case of an individual, trust or estate,
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1 for taxable years beginning prior to July 1, 1989 and
2 ending after June 30, 1989, an amount equal to the sum of
3 (i) 2 1/2% of the taxpayer's net income for the period
4 prior to July 1, 1989, as calculated under Section 202.3,
5 and (ii) 3% of the taxpayer's net income for the period
6 after June 30, 1989, as calculated under Section 202.3.
7 (3) In the case of an individual, trust or estate,
8 for taxable years beginning after June 30, 1989, an
9 amount equal to 3% of the taxpayer's net income for the
10 taxable year.
11 (4) (Blank).
12 (5) (Blank).
13 (6) In the case of a corporation, for taxable years
14 ending prior to July 1, 1989, an amount equal to 4% of
15 the taxpayer's net income for the taxable year.
16 (7) In the case of a corporation, for taxable years
17 beginning prior to July 1, 1989 and ending after June 30,
18 1989, an amount equal to the sum of (i) 4% of the
19 taxpayer's net income for the period prior to July 1,
20 1989, as calculated under Section 202.3, and (ii) 4.8% of
21 the taxpayer's net income for the period after June 30,
22 1989, as calculated under Section 202.3.
23 (8) In the case of a corporation, for taxable years
24 beginning after June 30, 1989, an amount equal to 4.8% of
25 the taxpayer's net income for the taxable year.
26 (c) Beginning on July 1, 1979 and thereafter, in
27 addition to such income tax, there is also hereby imposed the
28 Personal Property Tax Replacement Income Tax measured by net
29 income on every corporation (including Subchapter S
30 corporations), partnership and trust, for each taxable year
31 ending after June 30, 1979. Such taxes are imposed on the
32 privilege of earning or receiving income in or as a resident
33 of this State. The Personal Property Tax Replacement Income
34 Tax shall be in addition to the income tax imposed by
35 subsections (a) and (b) of this Section and in addition to
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1 all other occupation or privilege taxes imposed by this State
2 or by any municipal corporation or political subdivision
3 thereof.
4 (d) Additional Personal Property Tax Replacement Income
5 Tax Rates. The personal property tax replacement income tax
6 imposed by this subsection and subsection (c) of this Section
7 in the case of a corporation, other than a Subchapter S
8 corporation, shall be an additional amount equal to 2.85% of
9 such taxpayer's net income for the taxable year, except that
10 beginning on January 1, 1981, and thereafter, the rate of
11 2.85% specified in this subsection shall be reduced to 2.5%,
12 and in the case of a partnership, trust or a Subchapter S
13 corporation shall be an additional amount equal to 1.5% of
14 such taxpayer's net income for the taxable year.
15 (e) Investment credit. A taxpayer shall be allowed a
16 credit against the Personal Property Tax Replacement Income
17 Tax for investment in qualified property.
18 (1) A taxpayer shall be allowed a credit equal to
19 .5% of the basis of qualified property placed in service
20 during the taxable year, provided such property is placed
21 in service on or after July 1, 1984. There shall be
22 allowed an additional credit equal to .5% of the basis of
23 qualified property placed in service during the taxable
24 year, provided such property is placed in service on or
25 after July 1, 1986, and the taxpayer's base employment
26 within Illinois has increased by 1% or more over the
27 preceding year as determined by the taxpayer's employment
28 records filed with the Illinois Department of Employment
29 Security. Taxpayers who are new to Illinois shall be
30 deemed to have met the 1% growth in base employment for
31 the first year in which they file employment records with
32 the Illinois Department of Employment Security. The
33 provisions added to this Section by Public Act 85-1200
34 (and restored by Public Act 87-895) shall be construed as
35 declaratory of existing law and not as a new enactment.
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1 If, in any year, the increase in base employment within
2 Illinois over the preceding year is less than 1%, the
3 additional credit shall be limited to that percentage
4 times a fraction, the numerator of which is .5% and the
5 denominator of which is 1%, but shall not exceed .5%.
6 The investment credit shall not be allowed to the extent
7 that it would reduce a taxpayer's liability in any tax
8 year below zero, nor may any credit for qualified
9 property be allowed for any year other than the year in
10 which the property was placed in service in Illinois. For
11 tax years ending on or after December 31, 1987, and on or
12 before December 31, 1988, the credit shall be allowed for
13 the tax year in which the property is placed in service,
14 or, if the amount of the credit exceeds the tax liability
15 for that year, whether it exceeds the original liability
16 or the liability as later amended, such excess may be
17 carried forward and applied to the tax liability of the 5
18 taxable years following the excess credit years if the
19 taxpayer (i) makes investments which cause the creation
20 of a minimum of 2,000 full-time equivalent jobs in
21 Illinois, (ii) is located in an enterprise zone
22 established pursuant to the Illinois Enterprise Zone Act
23 and (iii) is certified by the Department of Commerce and
24 Community Affairs as complying with the requirements
25 specified in clause (i) and (ii) by July 1, 1986. The
26 Department of Commerce and Community Affairs shall notify
27 the Department of Revenue of all such certifications
28 immediately. For tax years ending after December 31,
29 1988, the credit shall be allowed for the tax year in
30 which the property is placed in service, or, if the
31 amount of the credit exceeds the tax liability for that
32 year, whether it exceeds the original liability or the
33 liability as later amended, such excess may be carried
34 forward and applied to the tax liability of the 5 taxable
35 years following the excess credit years. The credit shall
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1 be applied to the earliest year for which there is a
2 liability. If there is credit from more than one tax year
3 that is available to offset a liability, earlier credit
4 shall be applied first.
5 (2) The term "qualified property" means property
6 which:
7 (A) is tangible, whether new or used,
8 including buildings and structural components of
9 buildings and signs that are real property, but not
10 including land or improvements to real property that
11 are not a structural component of a building such as
12 landscaping, sewer lines, local access roads,
13 fencing, parking lots, and other appurtenances;
14 (B) is depreciable pursuant to Section 167 of
15 the Internal Revenue Code, except that "3-year
16 property" as defined in Section 168(c)(2)(A) of that
17 Code is not eligible for the credit provided by this
18 subsection (e);
19 (C) is acquired by purchase as defined in
20 Section 179(d) of the Internal Revenue Code;
21 (D) is used in Illinois by a taxpayer who is
22 primarily engaged in manufacturing, or in mining
23 coal or fluorite, or in retailing; and
24 (E) has not previously been used in Illinois
25 in such a manner and by such a person as would
26 qualify for the credit provided by this subsection
27 (e) or subsection (f).
28 (3) For purposes of this subsection (e),
29 "manufacturing" means the material staging and production
30 of tangible personal property by procedures commonly
31 regarded as manufacturing, processing, fabrication, or
32 assembling which changes some existing material into new
33 shapes, new qualities, or new combinations. For purposes
34 of this subsection (e) the term "mining" shall have the
35 same meaning as the term "mining" in Section 613(c) of
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1 the Internal Revenue Code. For purposes of this
2 subsection (e), the term "retailing" means the sale of
3 tangible personal property or services rendered in
4 conjunction with the sale of tangible consumer goods or
5 commodities.
6 (4) The basis of qualified property shall be the
7 basis used to compute the depreciation deduction for
8 federal income tax purposes.
9 (5) If the basis of the property for federal income
10 tax depreciation purposes is increased after it has been
11 placed in service in Illinois by the taxpayer, the amount
12 of such increase shall be deemed property placed in
13 service on the date of such increase in basis.
14 (6) The term "placed in service" shall have the
15 same meaning as under Section 46 of the Internal Revenue
16 Code.
17 (7) If during any taxable year, any property ceases
18 to be qualified property in the hands of the taxpayer
19 within 48 months after being placed in service, or the
20 situs of any qualified property is moved outside Illinois
21 within 48 months after being placed in service, the
22 Personal Property Tax Replacement Income Tax for such
23 taxable year shall be increased. Such increase shall be
24 determined by (i) recomputing the investment credit which
25 would have been allowed for the year in which credit for
26 such property was originally allowed by eliminating such
27 property from such computation and, (ii) subtracting such
28 recomputed credit from the amount of credit previously
29 allowed. For the purposes of this paragraph (7), a
30 reduction of the basis of qualified property resulting
31 from a redetermination of the purchase price shall be
32 deemed a disposition of qualified property to the extent
33 of such reduction.
34 (8) Unless the investment credit is extended by
35 law, the basis of qualified property shall not include
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1 costs incurred after December 31, 2003, except for costs
2 incurred pursuant to a binding contract entered into on
3 or before December 31, 2003.
4 (9) Each taxable year, a partnership may elect to
5 pass through to its partners the credits to which the
6 partnership is entitled under this subsection (e) for the
7 taxable year. A partner may use the credit allocated to
8 him or her under this paragraph only against the tax
9 imposed in subsections (c) and (d) of this Section. If
10 the partnership makes that election, those credits shall
11 be allocated among the partners in the partnership in
12 accordance with the rules set forth in Section 704(b) of
13 the Internal Revenue Code, and the rules promulgated
14 under that Section, and the allocated amount of the
15 credits shall be allowed to the partners for that taxable
16 year. The partnership shall make this election on its
17 Personal Property Tax Replacement Income Tax return for
18 that taxable year. The election to pass through the
19 credits shall be irrevocable.
20 (f) Investment credit; Enterprise Zone.
21 (1) A taxpayer shall be allowed a credit against
22 the tax imposed by subsections (a) and (b) of this
23 Section for investment in qualified property which is
24 placed in service in an Enterprise Zone created pursuant
25 to the Illinois Enterprise Zone Act. For partners, and
26 for shareholders of Subchapter S corporations, and owners
27 of limited liability companies, if the liability company
28 is treated as a partnership for purposes of federal and
29 State income taxation, there shall be allowed a credit
30 under this subsection (f) to be determined in accordance
31 with the determination of income and distributive share
32 of income under Sections 702 and 704 and Subchapter S of
33 the Internal Revenue Code. The credit shall be .5% of the
34 basis for such property. The credit shall be available
35 only in the taxable year in which the property is placed
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1 in service in the Enterprise Zone and shall not be
2 allowed to the extent that it would reduce a taxpayer's
3 liability for the tax imposed by subsections (a) and (b)
4 of this Section to below zero. For tax years ending on or
5 after December 31, 1985, the credit shall be allowed for
6 the tax year in which the property is placed in service,
7 or, if the amount of the credit exceeds the tax liability
8 for that year, whether it exceeds the original liability
9 or the liability as later amended, such excess may be
10 carried forward and applied to the tax liability of the 5
11 taxable years following the excess credit year. The
12 credit shall be applied to the earliest year for which
13 there is a liability. If there is credit from more than
14 one tax year that is available to offset a liability, the
15 credit accruing first in time shall be applied first.
16 (2) The term qualified property means property
17 which:
18 (A) is tangible, whether new or used,
19 including buildings and structural components of
20 buildings;
21 (B) is depreciable pursuant to Section 167 of
22 the Internal Revenue Code, except that "3-year
23 property" as defined in Section 168(c)(2)(A) of that
24 Code is not eligible for the credit provided by this
25 subsection (f);
26 (C) is acquired by purchase as defined in
27 Section 179(d) of the Internal Revenue Code;
28 (D) is used in the Enterprise Zone by the
29 taxpayer; and
30 (E) has not been previously used in Illinois
31 in such a manner and by such a person as would
32 qualify for the credit provided by this subsection
33 (f) or subsection (e).
34 (3) The basis of qualified property shall be the
35 basis used to compute the depreciation deduction for
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1 federal income tax purposes.
2 (4) If the basis of the property for federal income
3 tax depreciation purposes is increased after it has been
4 placed in service in the Enterprise Zone by the taxpayer,
5 the amount of such increase shall be deemed property
6 placed in service on the date of such increase in basis.
7 (5) The term "placed in service" shall have the
8 same meaning as under Section 46 of the Internal Revenue
9 Code.
10 (6) If during any taxable year, any property ceases
11 to be qualified property in the hands of the taxpayer
12 within 48 months after being placed in service, or the
13 situs of any qualified property is moved outside the
14 Enterprise Zone within 48 months after being placed in
15 service, the tax imposed under subsections (a) and (b) of
16 this Section for such taxable year shall be increased.
17 Such increase shall be determined by (i) recomputing the
18 investment credit which would have been allowed for the
19 year in which credit for such property was originally
20 allowed by eliminating such property from such
21 computation, and (ii) subtracting such recomputed credit
22 from the amount of credit previously allowed. For the
23 purposes of this paragraph (6), a reduction of the basis
24 of qualified property resulting from a redetermination of
25 the purchase price shall be deemed a disposition of
26 qualified property to the extent of such reduction.
27 (g) Jobs Tax Credit; Enterprise Zone and Foreign
28 Trade Zone or Sub-Zone.
29 (1) A taxpayer conducting a trade or business in an
30 enterprise zone or a High Impact Business designated by
31 the Department of Commerce and Community Affairs
32 conducting a trade or business in a federally designated
33 Foreign Trade Zone or Sub-Zone shall be allowed a credit
34 against the tax imposed by subsections (a) and (b) of
35 this Section in the amount of $500 per eligible employee
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1 hired to work in the zone during the taxable year.
2 (2) To qualify for the credit:
3 (A) the taxpayer must hire 5 or more eligible
4 employees to work in an enterprise zone or federally
5 designated Foreign Trade Zone or Sub-Zone during the
6 taxable year;
7 (B) the taxpayer's total employment within the
8 enterprise zone or federally designated Foreign
9 Trade Zone or Sub-Zone must increase by 5 or more
10 full-time employees beyond the total employed in
11 that zone at the end of the previous tax year for
12 which a jobs tax credit under this Section was
13 taken, or beyond the total employed by the taxpayer
14 as of December 31, 1985, whichever is later; and
15 (C) the eligible employees must be employed
16 180 consecutive days in order to be deemed hired for
17 purposes of this subsection.
18 (3) An "eligible employee" means an employee who
19 is:
20 (A) Certified by the Department of Commerce
21 and Community Affairs as "eligible for services"
22 pursuant to regulations promulgated in accordance
23 with Title II of the Job Training Partnership Act,
24 Training Services for the Disadvantaged or Title III
25 of the Job Training Partnership Act, Employment and
26 Training Assistance for Dislocated Workers Program.
27 (B) Hired after the enterprise zone or
28 federally designated Foreign Trade Zone or Sub-Zone
29 was designated or the trade or business was located
30 in that zone, whichever is later.
31 (C) Employed in the enterprise zone or Foreign
32 Trade Zone or Sub-Zone. An employee is employed in
33 an enterprise zone or federally designated Foreign
34 Trade Zone or Sub-Zone if his services are rendered
35 there or it is the base of operations for the
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1 services performed.
2 (D) A full-time employee working 30 or more
3 hours per week.
4 (4) For tax years ending on or after December 31,
5 1985 and prior to December 31, 1988, the credit shall be
6 allowed for the tax year in which the eligible employees
7 are hired. For tax years ending on or after December 31,
8 1988, the credit shall be allowed for the tax year
9 immediately following the tax year in which the eligible
10 employees are hired. If the amount of the credit exceeds
11 the tax liability for that year, whether it exceeds the
12 original liability or the liability as later amended,
13 such excess may be carried forward and applied to the tax
14 liability of the 5 taxable years following the excess
15 credit year. The credit shall be applied to the earliest
16 year for which there is a liability. If there is credit
17 from more than one tax year that is available to offset a
18 liability, earlier credit shall be applied first.
19 (5) The Department of Revenue shall promulgate such
20 rules and regulations as may be deemed necessary to carry
21 out the purposes of this subsection (g).
22 (6) The credit shall be available for eligible
23 employees hired on or after January 1, 1986.
24 (h) Investment credit; High Impact Business.
25 (1) Subject to subsection (b) of Section 5.5 of the
26 Illinois Enterprise Zone Act, a taxpayer shall be allowed
27 a credit against the tax imposed by subsections (a) and
28 (b) of this Section for investment in qualified property
29 which is placed in service by a Department of Commerce
30 and Community Affairs designated High Impact Business.
31 The credit shall be .5% of the basis for such property.
32 The credit shall not be available until the minimum
33 investments in qualified property set forth in Section
34 5.5 of the Illinois Enterprise Zone Act have been
35 satisfied and shall not be allowed to the extent that it
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1 would reduce a taxpayer's liability for the tax imposed
2 by subsections (a) and (b) of this Section to below zero.
3 The credit applicable to such minimum investments shall
4 be taken in the taxable year in which such minimum
5 investments have been completed. The credit for
6 additional investments beyond the minimum investment by a
7 designated high impact business shall be available only
8 in the taxable year in which the property is placed in
9 service and shall not be allowed to the extent that it
10 would reduce a taxpayer's liability for the tax imposed
11 by subsections (a) and (b) of this Section to below zero.
12 For tax years ending on or after December 31, 1987, the
13 credit shall be allowed for the tax year in which the
14 property is placed in service, or, if the amount of the
15 credit exceeds the tax liability for that year, whether
16 it exceeds the original liability or the liability as
17 later amended, such excess may be carried forward and
18 applied to the tax liability of the 5 taxable years
19 following the excess credit year. The credit shall be
20 applied to the earliest year for which there is a
21 liability. If there is credit from more than one tax
22 year that is available to offset a liability, the credit
23 accruing first in time shall be applied first.
24 Changes made in this subdivision (h)(1) by Public
25 Act 88-670 restore changes made by Public Act 85-1182 and
26 reflect existing law.
27 (2) The term qualified property means property
28 which:
29 (A) is tangible, whether new or used,
30 including buildings and structural components of
31 buildings;
32 (B) is depreciable pursuant to Section 167 of
33 the Internal Revenue Code, except that "3-year
34 property" as defined in Section 168(c)(2)(A) of that
35 Code is not eligible for the credit provided by this
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1 subsection (h);
2 (C) is acquired by purchase as defined in
3 Section 179(d) of the Internal Revenue Code; and
4 (D) is not eligible for the Enterprise Zone
5 Investment Credit provided by subsection (f) of this
6 Section.
7 (3) The basis of qualified property shall be the
8 basis used to compute the depreciation deduction for
9 federal income tax purposes.
10 (4) If the basis of the property for federal income
11 tax depreciation purposes is increased after it has been
12 placed in service in a federally designated Foreign Trade
13 Zone or Sub-Zone located in Illinois by the taxpayer, the
14 amount of such increase shall be deemed property placed
15 in service on the date of such increase in basis.
16 (5) The term "placed in service" shall have the
17 same meaning as under Section 46 of the Internal Revenue
18 Code.
19 (6) If during any taxable year ending on or before
20 December 31, 1996, any property ceases to be qualified
21 property in the hands of the taxpayer within 48 months
22 after being placed in service, or the situs of any
23 qualified property is moved outside Illinois within 48
24 months after being placed in service, the tax imposed
25 under subsections (a) and (b) of this Section for such
26 taxable year shall be increased. Such increase shall be
27 determined by (i) recomputing the investment credit which
28 would have been allowed for the year in which credit for
29 such property was originally allowed by eliminating such
30 property from such computation, and (ii) subtracting such
31 recomputed credit from the amount of credit previously
32 allowed. For the purposes of this paragraph (6), a
33 reduction of the basis of qualified property resulting
34 from a redetermination of the purchase price shall be
35 deemed a disposition of qualified property to the extent
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1 of such reduction.
2 (7) Beginning with tax years ending after December
3 31, 1996, if a taxpayer qualifies for the credit under
4 this subsection (h) and thereby is granted a tax
5 abatement and the taxpayer relocates its entire facility
6 in violation of the explicit terms and length of the
7 contract under Section 18-183 of the Property Tax Code,
8 the tax imposed under subsections (a) and (b) of this
9 Section shall be increased for the taxable year in which
10 the taxpayer relocated its facility by an amount equal to
11 the amount of credit received by the taxpayer under this
12 subsection (h).
13 (i) A credit shall be allowed against the tax imposed by
14 subsections (a) and (b) of this Section for the tax imposed
15 by subsections (c) and (d) of this Section. This credit
16 shall be computed by multiplying the tax imposed by
17 subsections (c) and (d) of this Section by a fraction, the
18 numerator of which is base income allocable to Illinois and
19 the denominator of which is Illinois base income, and further
20 multiplying the product by the tax rate imposed by
21 subsections (a) and (b) of this Section.
22 Any credit earned on or after December 31, 1986 under
23 this subsection which is unused in the year the credit is
24 computed because it exceeds the tax liability imposed by
25 subsections (a) and (b) for that year (whether it exceeds the
26 original liability or the liability as later amended) may be
27 carried forward and applied to the tax liability imposed by
28 subsections (a) and (b) of the 5 taxable years following the
29 excess credit year. This credit shall be applied first to
30 the earliest year for which there is a liability. If there
31 is a credit under this subsection from more than one tax year
32 that is available to offset a liability the earliest credit
33 arising under this subsection shall be applied first.
34 If, during any taxable year ending on or after December
35 31, 1986, the tax imposed by subsections (c) and (d) of this
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1 Section for which a taxpayer has claimed a credit under this
2 subsection (i) is reduced, the amount of credit for such tax
3 shall also be reduced. Such reduction shall be determined by
4 recomputing the credit to take into account the reduced tax
5 imposed by subsection (c) and (d). If any portion of the
6 reduced amount of credit has been carried to a different
7 taxable year, an amended return shall be filed for such
8 taxable year to reduce the amount of credit claimed.
9 (j) Training expense credit. Beginning with tax years
10 ending on or after December 31, 1986, a taxpayer shall be
11 allowed a credit against the tax imposed by subsection (a)
12 and (b) under this Section for all amounts paid or accrued,
13 on behalf of all persons employed by the taxpayer in Illinois
14 or Illinois residents employed outside of Illinois by a
15 taxpayer, for educational or vocational training in
16 semi-technical or technical fields or semi-skilled or skilled
17 fields, which were deducted from gross income in the
18 computation of taxable income. The credit against the tax
19 imposed by subsections (a) and (b) shall be 1.6% of such
20 training expenses. For partners, and for shareholders of
21 subchapter S corporations, and owners of limited liability
22 companies, if the liability company is treated as a
23 partnership for purposes of federal and State income
24 taxation, there shall be allowed a credit under this
25 subsection (j) to be determined in accordance with the
26 determination of income and distributive share of income
27 under Sections 702 and 704 and subchapter S of the Internal
28 Revenue Code.
29 Any credit allowed under this subsection which is unused
30 in the year the credit is earned may be carried forward to
31 each of the 5 taxable years following the year for which the
32 credit is first computed until it is used. This credit shall
33 be applied first to the earliest year for which there is a
34 liability. If there is a credit under this subsection from
35 more than one tax year that is available to offset a
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1 liability the earliest credit arising under this subsection
2 shall be applied first.
3 (k) Research and development credit.
4 Beginning with tax years ending after July 1, 1990, a
5 taxpayer shall be allowed a credit against the tax imposed by
6 subsections (a) and (b) of this Section for increasing
7 research activities in this State. The credit allowed
8 against the tax imposed by subsections (a) and (b) shall be
9 equal to 6 1/2% of the qualifying expenditures for increasing
10 research activities in this State. For partners, shareholders
11 of subchapter S corporations, and owners of limited liability
12 companies, if the liability company is treated as a
13 partnership for purposes of federal and State income
14 taxation, there shall be allowed a credit under this
15 subsection to be determined in accordance with the
16 determination of income and distributive share of income
17 under Sections 702 and 704 and subchapter S of the Internal
18 Revenue Code.
19 For purposes of this subsection, "qualifying
20 expenditures" means the qualifying expenditures as defined
21 for the federal credit for increasing research activities
22 which would be allowable under Section 41 of the Internal
23 Revenue Code and which are conducted in this State,
24 "qualifying expenditures for increasing research activities
25 in this State" means the excess of qualifying expenditures
26 for the taxable year in which incurred over qualifying
27 expenditures for the base period, "qualifying expenditures
28 for the base period" means the average of the qualifying
29 expenditures for each year in the base period, and "base
30 period" means the 3 taxable years immediately preceding the
31 taxable year for which the determination is being made.
32 Any credit in excess of the tax liability for the taxable
33 year may be carried forward. A taxpayer may elect to have the
34 unused credit shown on its final completed return carried
35 over as a credit against the tax liability for the following
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1 5 taxable years or until it has been fully used, whichever
2 occurs first.
3 If an unused credit is carried forward to a given year
4 from 2 or more earlier years, that credit arising in the
5 earliest year will be applied first against the tax liability
6 for the given year. If a tax liability for the given year
7 still remains, the credit from the next earliest year will
8 then be applied, and so on, until all credits have been used
9 or no tax liability for the given year remains. Any
10 remaining unused credit or credits then will be carried
11 forward to the next following year in which a tax liability
12 is incurred, except that no credit can be carried forward to
13 a year which is more than 5 years after the year in which the
14 expense for which the credit is given was incurred.
15 Unless extended by law, the credit shall not include
16 costs incurred after December 31, 2004, except for costs
17 incurred pursuant to a binding contract entered into on or
18 before December 31, 2004.
19 No inference shall be drawn from this amendatory Act of
20 the 91st General Assembly in construing this Section for
21 taxable years beginning before January 1, 1999.
22 (l) Environmental Remediation Tax Credit.
23 (i) For tax years ending after December 31, 1997
24 and on or before December 31, 2001, a taxpayer shall be
25 allowed a credit against the tax imposed by subsections
26 (a) and (b) of this Section for certain amounts paid for
27 unreimbursed eligible remediation costs, as specified in
28 this subsection. For purposes of this Section,
29 "unreimbursed eligible remediation costs" means costs
30 approved by the Illinois Environmental Protection Agency
31 ("Agency") under Section 58.14 of the Environmental
32 Protection Act that were paid in performing environmental
33 remediation at a site for which a No Further Remediation
34 Letter was issued by the Agency and recorded under
35 Section 58.10 of the Environmental Protection Act. The
-18- LRB9105091PTmbccr2
1 credit must be claimed for the taxable year in which
2 Agency approval of the eligible remediation costs is
3 granted. The credit is not available to any taxpayer if
4 the taxpayer or any related party caused or contributed
5 to, in any material respect, a release of regulated
6 substances on, in, or under the site that was identified
7 and addressed by the remedial action pursuant to the Site
8 Remediation Program of the Environmental Protection Act.
9 After the Pollution Control Board rules are adopted
10 pursuant to the Illinois Administrative Procedure Act for
11 the administration and enforcement of Section 58.9 of the
12 Environmental Protection Act, determinations as to credit
13 availability for purposes of this Section shall be made
14 consistent with those rules. For purposes of this
15 Section, "taxpayer" includes a person whose tax
16 attributes the taxpayer has succeeded to under Section
17 381 of the Internal Revenue Code and "related party"
18 includes the persons disallowed a deduction for losses by
19 paragraphs (b), (c), and (f)(1) of Section 267 of the
20 Internal Revenue Code by virtue of being a related
21 taxpayer, as well as any of its partners. The credit
22 allowed against the tax imposed by subsections (a) and
23 (b) shall be equal to 25% of the unreimbursed eligible
24 remediation costs in excess of $100,000 per site, except
25 that the $100,000 threshold shall not apply to any site
26 contained in an enterprise zone as determined by the
27 Department of Commerce and Community Affairs. The total
28 credit allowed shall not exceed $40,000 per year with a
29 maximum total of $150,000 per site. For partners and
30 shareholders of subchapter S corporations, there shall be
31 allowed a credit under this subsection to be determined
32 in accordance with the determination of income and
33 distributive share of income under Sections 702 and 704
34 of subchapter S of the Internal Revenue Code.
35 (ii) A credit allowed under this subsection that is
-19- LRB9105091PTmbccr2
1 unused in the year the credit is earned may be carried
2 forward to each of the 5 taxable years following the year
3 for which the credit is first earned until it is used.
4 The term "unused credit" does not include any amounts of
5 unreimbursed eligible remediation costs in excess of the
6 maximum credit per site authorized under paragraph (i).
7 This credit shall be applied first to the earliest year
8 for which there is a liability. If there is a credit
9 under this subsection from more than one tax year that is
10 available to offset a liability, the earliest credit
11 arising under this subsection shall be applied first. A
12 credit allowed under this subsection may be sold to a
13 buyer as part of a sale of all or part of the remediation
14 site for which the credit was granted. The purchaser of
15 a remediation site and the tax credit shall succeed to
16 the unused credit and remaining carry-forward period of
17 the seller. To perfect the transfer, the assignor shall
18 record the transfer in the chain of title for the site
19 and provide written notice to the Director of the
20 Illinois Department of Revenue of the assignor's intent
21 to sell the remediation site and the amount of the tax
22 credit to be transferred as a portion of the sale. In no
23 event may a credit be transferred to any taxpayer if the
24 taxpayer or a related party would not be eligible under
25 the provisions of subsection (i).
26 (iii) For purposes of this Section, the term "site"
27 shall have the same meaning as under Section 58.2 of the
28 Environmental Protection Act.
29 (Source: P.A. 89-235, eff. 8-4-95; 89-519, eff. 7-18-96;
30 89-591, eff. 8-1-96; 90-123, eff. 7-21-97; 90-458, eff.
31 8-17-97; 90-605, eff. 6-30-98; 90-655, eff. 7-30-98; 90-717,
32 eff. 8-7-98; 90-792, eff. 1-1-99; revised 9-16-98.)
33 Section 5. The Use Tax Act is amended by changing
34 Section 3-5 as follows:
-20- LRB9105091PTmbccr2
1 (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5)
2 Sec. 3-5. Exemptions. Use of the following tangible
3 personal property is exempt from the tax imposed by this Act:
4 (1) Personal property purchased from a corporation,
5 society, association, foundation, institution, or
6 organization, other than a limited liability company, that is
7 organized and operated as a not-for-profit service enterprise
8 for the benefit of persons 65 years of age or older if the
9 personal property was not purchased by the enterprise for the
10 purpose of resale by the enterprise.
11 (2) Personal property purchased by a not-for-profit
12 Illinois county fair association for use in conducting,
13 operating, or promoting the county fair.
14 (3) Personal property purchased by a not-for-profit
15 music or dramatic arts organization that establishes, by
16 proof required by the Department by rule, that it has
17 received an exemption under Section 501(c)(3) of the Internal
18 Revenue Code and that is organized and operated for the
19 presentation of live public performances of musical or
20 theatrical works on a regular basis.
21 (4) Personal property purchased by a governmental body,
22 by a corporation, society, association, foundation, or
23 institution organized and operated exclusively for
24 charitable, religious, or educational purposes, or by a
25 not-for-profit corporation, society, association, foundation,
26 institution, or organization that has no compensated officers
27 or employees and that is organized and operated primarily for
28 the recreation of persons 55 years of age or older. A limited
29 liability company may qualify for the exemption under this
30 paragraph only if the limited liability company is organized
31 and operated exclusively for educational purposes. On and
32 after July 1, 1987, however, no entity otherwise eligible for
33 this exemption shall make tax-free purchases unless it has an
34 active exemption identification number issued by the
35 Department.
-21- LRB9105091PTmbccr2
1 (5) A passenger car that is a replacement vehicle to the
2 extent that the purchase price of the car is subject to the
3 Replacement Vehicle Tax.
4 (6) Graphic arts machinery and equipment, including
5 repair and replacement parts, both new and used, and
6 including that manufactured on special order, certified by
7 the purchaser to be used primarily for graphic arts
8 production, and including machinery and equipment purchased
9 for lease.
10 (7) Farm chemicals.
11 (8) Legal tender, currency, medallions, or gold or
12 silver coinage issued by the State of Illinois, the
13 government of the United States of America, or the government
14 of any foreign country, and bullion.
15 (9) Personal property purchased from a teacher-sponsored
16 student organization affiliated with an elementary or
17 secondary school located in Illinois.
18 (10) A motor vehicle of the first division, a motor
19 vehicle of the second division that is a self-contained motor
20 vehicle designed or permanently converted to provide living
21 quarters for recreational, camping, or travel use, with
22 direct walk through to the living quarters from the driver's
23 seat, or a motor vehicle of the second division that is of
24 the van configuration designed for the transportation of not
25 less than 7 nor more than 16 passengers, as defined in
26 Section 1-146 of the Illinois Vehicle Code, that is used for
27 automobile renting, as defined in the Automobile Renting
28 Occupation and Use Tax Act.
29 (11) Farm machinery and equipment, both new and used,
30 including that manufactured on special order, certified by
31 the purchaser to be used primarily for production agriculture
32 or State or federal agricultural programs, including
33 individual replacement parts for the machinery and equipment,
34 including machinery and equipment purchased for lease, and
35 including implements of husbandry defined in Section 1-130 of
-22- LRB9105091PTmbccr2
1 the Illinois Vehicle Code, farm machinery and agricultural
2 chemical and fertilizer spreaders, and nurse wagons required
3 to be registered under Section 3-809 of the Illinois Vehicle
4 Code, but excluding other motor vehicles required to be
5 registered under the Illinois Vehicle Code. Horticultural
6 polyhouses or hoop houses used for propagating, growing, or
7 overwintering plants shall be considered farm machinery and
8 equipment under this item (11). Agricultural chemical tender
9 tanks and dry boxes shall include units sold separately from
10 a motor vehicle required to be licensed and units sold
11 mounted on a motor vehicle required to be licensed if the
12 selling price of the tender is separately stated.
13 Farm machinery and equipment shall include precision
14 farming equipment that is installed or purchased to be
15 installed on farm machinery and equipment including, but not
16 limited to, tractors, harvesters, sprayers, planters,
17 seeders, or spreaders. Precision farming equipment includes,
18 but is not limited to, soil testing sensors, computers,
19 monitors, software, global positioning and mapping systems,
20 and other such equipment.
21 Farm machinery and equipment also includes computers,
22 sensors, software, and related equipment used primarily in
23 the computer-assisted operation of production agriculture
24 facilities, equipment, and activities such as, but not
25 limited to, the collection, monitoring, and correlation of
26 animal and crop data for the purpose of formulating animal
27 diets and agricultural chemicals. This item (11) is exempt
28 from the provisions of Section 3-90.
29 (12) Fuel and petroleum products sold to or used by an
30 air common carrier, certified by the carrier to be used for
31 consumption, shipment, or storage in the conduct of its
32 business as an air common carrier, for a flight destined for
33 or returning from a location or locations outside the United
34 States without regard to previous or subsequent domestic
35 stopovers.
-23- LRB9105091PTmbccr2
1 (13) Proceeds of mandatory service charges separately
2 stated on customers' bills for the purchase and consumption
3 of food and beverages purchased at retail from a retailer, to
4 the extent that the proceeds of the service charge are in
5 fact turned over as tips or as a substitute for tips to the
6 employees who participate directly in preparing, serving,
7 hosting or cleaning up the food or beverage function with
8 respect to which the service charge is imposed.
9 (14) Oil field exploration, drilling, and production
10 equipment, including (i) rigs and parts of rigs, rotary rigs,
11 cable tool rigs, and workover rigs, (ii) pipe and tubular
12 goods, including casing and drill strings, (iii) pumps and
13 pump-jack units, (iv) storage tanks and flow lines, (v) any
14 individual replacement part for oil field exploration,
15 drilling, and production equipment, and (vi) machinery and
16 equipment purchased for lease; but excluding motor vehicles
17 required to be registered under the Illinois Vehicle Code.
18 (15) Photoprocessing machinery and equipment, including
19 repair and replacement parts, both new and used, including
20 that manufactured on special order, certified by the
21 purchaser to be used primarily for photoprocessing, and
22 including photoprocessing machinery and equipment purchased
23 for lease.
24 (16) Coal exploration, mining, offhighway hauling,
25 processing, maintenance, and reclamation equipment, including
26 replacement parts and equipment, and including equipment
27 purchased for lease, but excluding motor vehicles required to
28 be registered under the Illinois Vehicle Code.
29 (17) Distillation machinery and equipment, sold as a
30 unit or kit, assembled or installed by the retailer,
31 certified by the user to be used only for the production of
32 ethyl alcohol that will be used for consumption as motor fuel
33 or as a component of motor fuel for the personal use of the
34 user, and not subject to sale or resale.
35 (18) Manufacturing and assembling machinery and
-24- LRB9105091PTmbccr2
1 equipment used primarily in the process of manufacturing or
2 assembling tangible personal property for wholesale or retail
3 sale or lease, whether that sale or lease is made directly by
4 the manufacturer or by some other person, whether the
5 materials used in the process are owned by the manufacturer
6 or some other person, or whether that sale or lease is made
7 apart from or as an incident to the seller's engaging in the
8 service occupation of producing machines, tools, dies, jigs,
9 patterns, gauges, or other similar items of no commercial
10 value on special order for a particular purchaser.
11 (19) Personal property delivered to a purchaser or
12 purchaser's donee inside Illinois when the purchase order for
13 that personal property was received by a florist located
14 outside Illinois who has a florist located inside Illinois
15 deliver the personal property.
16 (20) Semen used for artificial insemination of livestock
17 for direct agricultural production.
18 (21) Horses, or interests in horses, registered with and
19 meeting the requirements of any of the Arabian Horse Club
20 Registry of America, Appaloosa Horse Club, American Quarter
21 Horse Association, United States Trotting Association, or
22 Jockey Club, as appropriate, used for purposes of breeding or
23 racing for prizes.
24 (22) Computers and communications equipment utilized for
25 any hospital purpose and equipment used in the diagnosis,
26 analysis, or treatment of hospital patients purchased by a
27 lessor who leases the equipment, under a lease of one year or
28 longer executed or in effect at the time the lessor would
29 otherwise be subject to the tax imposed by this Act, to a
30 hospital that has been issued an active tax exemption
31 identification number by the Department under Section 1g of
32 the Retailers' Occupation Tax Act. If the equipment is
33 leased in a manner that does not qualify for this exemption
34 or is used in any other non-exempt manner, the lessor shall
35 be liable for the tax imposed under this Act or the Service
-25- LRB9105091PTmbccr2
1 Use Tax Act, as the case may be, based on the fair market
2 value of the property at the time the non-qualifying use
3 occurs. No lessor shall collect or attempt to collect an
4 amount (however designated) that purports to reimburse that
5 lessor for the tax imposed by this Act or the Service Use Tax
6 Act, as the case may be, if the tax has not been paid by the
7 lessor. If a lessor improperly collects any such amount from
8 the lessee, the lessee shall have a legal right to claim a
9 refund of that amount from the lessor. If, however, that
10 amount is not refunded to the lessee for any reason, the
11 lessor is liable to pay that amount to the Department.
12 (23) Personal property purchased by a lessor who leases
13 the property, under a lease of one year or longer executed
14 or in effect at the time the lessor would otherwise be
15 subject to the tax imposed by this Act, to a governmental
16 body that has been issued an active sales tax exemption
17 identification number by the Department under Section 1g of
18 the Retailers' Occupation Tax Act. If the property is leased
19 in a manner that does not qualify for this exemption or used
20 in any other non-exempt manner, the lessor shall be liable
21 for the tax imposed under this Act or the Service Use Tax
22 Act, as the case may be, based on the fair market value of
23 the property at the time the non-qualifying use occurs. No
24 lessor shall collect or attempt to collect an amount (however
25 designated) that purports to reimburse that lessor for the
26 tax imposed by this Act or the Service Use Tax Act, as the
27 case may be, if the tax has not been paid by the lessor. If
28 a lessor improperly collects any such amount from the lessee,
29 the lessee shall have a legal right to claim a refund of that
30 amount from the lessor. If, however, that amount is not
31 refunded to the lessee for any reason, the lessor is liable
32 to pay that amount to the Department.
33 (24) Beginning with taxable years ending on or after
34 December 31, 1995 and ending with taxable years ending on or
35 before December 31, 2004, personal property that is donated
-26- LRB9105091PTmbccr2
1 for disaster relief to be used in a State or federally
2 declared disaster area in Illinois or bordering Illinois by a
3 manufacturer or retailer that is registered in this State to
4 a corporation, society, association, foundation, or
5 institution that has been issued a sales tax exemption
6 identification number by the Department that assists victims
7 of the disaster who reside within the declared disaster area.
8 (25) Beginning with taxable years ending on or after
9 December 31, 1995 and ending with taxable years ending on or
10 before December 31, 2004, personal property that is used in
11 the performance of infrastructure repairs in this State,
12 including but not limited to municipal roads and streets,
13 access roads, bridges, sidewalks, waste disposal systems,
14 water and sewer line extensions, water distribution and
15 purification facilities, storm water drainage and retention
16 facilities, and sewage treatment facilities, resulting from a
17 State or federally declared disaster in Illinois or bordering
18 Illinois when such repairs are initiated on facilities
19 located in the declared disaster area within 6 months after
20 the disaster.
21 (26) Beginning January 1, 2000, new or used automatic
22 vending machines that prepare and serve hot food and
23 beverages, including coffee, soup, and other items, and
24 replacement parts for these machines. This paragraph is
25 exempt from the provisions of Section 3-90.
26 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
27 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
28 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
29 eff. 12-12-97; 90-605, eff. 6-30-98.)
30 Section 10. The Service Use Tax Act is amended by
31 changing Section 3-5 as follows:
32 (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
33 Sec. 3-5. Exemptions. Use of the following tangible
-27- LRB9105091PTmbccr2
1 personal property is exempt from the tax imposed by this Act:
2 (1) Personal property purchased from a corporation,
3 society, association, foundation, institution, or
4 organization, other than a limited liability company, that is
5 organized and operated as a not-for-profit service enterprise
6 for the benefit of persons 65 years of age or older if the
7 personal property was not purchased by the enterprise for the
8 purpose of resale by the enterprise.
9 (2) Personal property purchased by a non-profit Illinois
10 county fair association for use in conducting, operating, or
11 promoting the county fair.
12 (3) Personal property purchased by a not-for-profit
13 music or dramatic arts organization that establishes, by
14 proof required by the Department by rule, that it has
15 received an exemption under Section 501(c)(3) of the Internal
16 Revenue Code and that is organized and operated for the
17 presentation of live public performances of musical or
18 theatrical works on a regular basis.
19 (4) Legal tender, currency, medallions, or gold or
20 silver coinage issued by the State of Illinois, the
21 government of the United States of America, or the government
22 of any foreign country, and bullion.
23 (5) Graphic arts machinery and equipment, including
24 repair and replacement parts, both new and used, and
25 including that manufactured on special order or purchased for
26 lease, certified by the purchaser to be used primarily for
27 graphic arts production.
28 (6) Personal property purchased from a teacher-sponsored
29 student organization affiliated with an elementary or
30 secondary school located in Illinois.
31 (7) Farm machinery and equipment, both new and used,
32 including that manufactured on special order, certified by
33 the purchaser to be used primarily for production agriculture
34 or State or federal agricultural programs, including
35 individual replacement parts for the machinery and equipment,
-28- LRB9105091PTmbccr2
1 including machinery and equipment purchased for lease, and
2 including implements of husbandry defined in Section 1-130 of
3 the Illinois Vehicle Code, farm machinery and agricultural
4 chemical and fertilizer spreaders, and nurse wagons required
5 to be registered under Section 3-809 of the Illinois Vehicle
6 Code, but excluding other motor vehicles required to be
7 registered under the Illinois Vehicle Code. Horticultural
8 polyhouses or hoop houses used for propagating, growing, or
9 overwintering plants shall be considered farm machinery and
10 equipment under this item (7). Agricultural chemical tender
11 tanks and dry boxes shall include units sold separately from
12 a motor vehicle required to be licensed and units sold
13 mounted on a motor vehicle required to be licensed if the
14 selling price of the tender is separately stated.
15 Farm machinery and equipment shall include precision
16 farming equipment that is installed or purchased to be
17 installed on farm machinery and equipment including, but not
18 limited to, tractors, harvesters, sprayers, planters,
19 seeders, or spreaders. Precision farming equipment includes,
20 but is not limited to, soil testing sensors, computers,
21 monitors, software, global positioning and mapping systems,
22 and other such equipment.
23 Farm machinery and equipment also includes computers,
24 sensors, software, and related equipment used primarily in
25 the computer-assisted operation of production agriculture
26 facilities, equipment, and activities such as, but not
27 limited to, the collection, monitoring, and correlation of
28 animal and crop data for the purpose of formulating animal
29 diets and agricultural chemicals. This item (7) is exempt
30 from the provisions of Section 3-75.
31 (8) Fuel and petroleum products sold to or used by an
32 air common carrier, certified by the carrier to be used for
33 consumption, shipment, or storage in the conduct of its
34 business as an air common carrier, for a flight destined for
35 or returning from a location or locations outside the United
-29- LRB9105091PTmbccr2
1 States without regard to previous or subsequent domestic
2 stopovers.
3 (9) Proceeds of mandatory service charges separately
4 stated on customers' bills for the purchase and consumption
5 of food and beverages acquired as an incident to the purchase
6 of a service from a serviceman, to the extent that the
7 proceeds of the service charge are in fact turned over as
8 tips or as a substitute for tips to the employees who
9 participate directly in preparing, serving, hosting or
10 cleaning up the food or beverage function with respect to
11 which the service charge is imposed.
12 (10) Oil field exploration, drilling, and production
13 equipment, including (i) rigs and parts of rigs, rotary rigs,
14 cable tool rigs, and workover rigs, (ii) pipe and tubular
15 goods, including casing and drill strings, (iii) pumps and
16 pump-jack units, (iv) storage tanks and flow lines, (v) any
17 individual replacement part for oil field exploration,
18 drilling, and production equipment, and (vi) machinery and
19 equipment purchased for lease; but excluding motor vehicles
20 required to be registered under the Illinois Vehicle Code.
21 (11) Proceeds from the sale of photoprocessing machinery
22 and equipment, including repair and replacement parts, both
23 new and used, including that manufactured on special order,
24 certified by the purchaser to be used primarily for
25 photoprocessing, and including photoprocessing machinery and
26 equipment purchased for lease.
27 (12) Coal exploration, mining, offhighway hauling,
28 processing, maintenance, and reclamation equipment, including
29 replacement parts and equipment, and including equipment
30 purchased for lease, but excluding motor vehicles required to
31 be registered under the Illinois Vehicle Code.
32 (13) Semen used for artificial insemination of livestock
33 for direct agricultural production.
34 (14) Horses, or interests in horses, registered with and
35 meeting the requirements of any of the Arabian Horse Club
-30- LRB9105091PTmbccr2
1 Registry of America, Appaloosa Horse Club, American Quarter
2 Horse Association, United States Trotting Association, or
3 Jockey Club, as appropriate, used for purposes of breeding or
4 racing for prizes.
5 (15) Computers and communications equipment utilized for
6 any hospital purpose and equipment used in the diagnosis,
7 analysis, or treatment of hospital patients purchased by a
8 lessor who leases the equipment, under a lease of one year or
9 longer executed or in effect at the time the lessor would
10 otherwise be subject to the tax imposed by this Act, to a
11 hospital that has been issued an active tax exemption
12 identification number by the Department under Section 1g of
13 the Retailers' Occupation Tax Act. If the equipment is leased
14 in a manner that does not qualify for this exemption or is
15 used in any other non-exempt manner, the lessor shall be
16 liable for the tax imposed under this Act or the Use Tax Act,
17 as the case may be, based on the fair market value of the
18 property at the time the non-qualifying use occurs. No
19 lessor shall collect or attempt to collect an amount (however
20 designated) that purports to reimburse that lessor for the
21 tax imposed by this Act or the Use Tax Act, as the case may
22 be, if the tax has not been paid by the lessor. If a lessor
23 improperly collects any such amount from the lessee, the
24 lessee shall have a legal right to claim a refund of that
25 amount from the lessor. If, however, that amount is not
26 refunded to the lessee for any reason, the lessor is liable
27 to pay that amount to the Department.
28 (16) Personal property purchased by a lessor who leases
29 the property, under a lease of one year or longer executed or
30 in effect at the time the lessor would otherwise be subject
31 to the tax imposed by this Act, to a governmental body that
32 has been issued an active tax exemption identification number
33 by the Department under Section 1g of the Retailers'
34 Occupation Tax Act. If the property is leased in a manner
35 that does not qualify for this exemption or is used in any
-31- LRB9105091PTmbccr2
1 other non-exempt manner, the lessor shall be liable for the
2 tax imposed under this Act or the Use Tax Act, as the case
3 may be, based on the fair market value of the property at the
4 time the non-qualifying use occurs. No lessor shall collect
5 or attempt to collect an amount (however designated) that
6 purports to reimburse that lessor for the tax imposed by this
7 Act or the Use Tax Act, as the case may be, if the tax has
8 not been paid by the lessor. If a lessor improperly collects
9 any such amount from the lessee, the lessee shall have a
10 legal right to claim a refund of that amount from the lessor.
11 If, however, that amount is not refunded to the lessee for
12 any reason, the lessor is liable to pay that amount to the
13 Department.
14 (17) Beginning with taxable years ending on or after
15 December 31, 1995 and ending with taxable years ending on or
16 before December 31, 2004, personal property that is donated
17 for disaster relief to be used in a State or federally
18 declared disaster area in Illinois or bordering Illinois by a
19 manufacturer or retailer that is registered in this State to
20 a corporation, society, association, foundation, or
21 institution that has been issued a sales tax exemption
22 identification number by the Department that assists victims
23 of the disaster who reside within the declared disaster area.
24 (18) Beginning with taxable years ending on or after
25 December 31, 1995 and ending with taxable years ending on or
26 before December 31, 2004, personal property that is used in
27 the performance of infrastructure repairs in this State,
28 including but not limited to municipal roads and streets,
29 access roads, bridges, sidewalks, waste disposal systems,
30 water and sewer line extensions, water distribution and
31 purification facilities, storm water drainage and retention
32 facilities, and sewage treatment facilities, resulting from a
33 State or federally declared disaster in Illinois or bordering
34 Illinois when such repairs are initiated on facilities
35 located in the declared disaster area within 6 months after
-32- LRB9105091PTmbccr2
1 the disaster.
2 (19) Beginning January 1, 2000, new or used automatic
3 vending machines that prepare and serve hot food and
4 beverages, including coffee, soup, and other items, and
5 replacement parts for these machines. This paragraph is
6 exempt from the provisions of Section 3-75.
7 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
8 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
9 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
10 eff. 12-12-97; 90-605, eff. 6-30-98.)
11 Section 15. The Service Occupation Tax Act is amended by
12 changing Section 3-5 as follows:
13 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
14 Sec. 3-5. Exemptions. The following tangible personal
15 property is exempt from the tax imposed by this Act:
16 (1) Personal property sold by a corporation, society,
17 association, foundation, institution, or organization, other
18 than a limited liability company, that is organized and
19 operated as a not-for-profit service enterprise for the
20 benefit of persons 65 years of age or older if the personal
21 property was not purchased by the enterprise for the purpose
22 of resale by the enterprise.
23 (2) Personal property purchased by a not-for-profit
24 Illinois county fair association for use in conducting,
25 operating, or promoting the county fair.
26 (3) Personal property purchased by any not-for-profit
27 music or dramatic arts organization that establishes, by
28 proof required by the Department by rule, that it has
29 received an exemption under Section 501(c)(3) of the
30 Internal Revenue Code and that is organized and operated for
31 the presentation of live public performances of musical or
32 theatrical works on a regular basis.
33 (4) Legal tender, currency, medallions, or gold or
-33- LRB9105091PTmbccr2
1 silver coinage issued by the State of Illinois, the
2 government of the United States of America, or the government
3 of any foreign country, and bullion.
4 (5) Graphic arts machinery and equipment, including
5 repair and replacement parts, both new and used, and
6 including that manufactured on special order or purchased for
7 lease, certified by the purchaser to be used primarily for
8 graphic arts production.
9 (6) Personal property sold by a teacher-sponsored
10 student organization affiliated with an elementary or
11 secondary school located in Illinois.
12 (7) Farm machinery and equipment, both new and used,
13 including that manufactured on special order, certified by
14 the purchaser to be used primarily for production agriculture
15 or State or federal agricultural programs, including
16 individual replacement parts for the machinery and equipment,
17 including machinery and equipment purchased for lease, and
18 including implements of husbandry defined in Section 1-130 of
19 the Illinois Vehicle Code, farm machinery and agricultural
20 chemical and fertilizer spreaders, and nurse wagons required
21 to be registered under Section 3-809 of the Illinois Vehicle
22 Code, but excluding other motor vehicles required to be
23 registered under the Illinois Vehicle Code. Horticultural
24 polyhouses or hoop houses used for propagating, growing, or
25 overwintering plants shall be considered farm machinery and
26 equipment under this item (7). Agricultural chemical tender
27 tanks and dry boxes shall include units sold separately from
28 a motor vehicle required to be licensed and units sold
29 mounted on a motor vehicle required to be licensed if the
30 selling price of the tender is separately stated.
31 Farm machinery and equipment shall include precision
32 farming equipment that is installed or purchased to be
33 installed on farm machinery and equipment including, but not
34 limited to, tractors, harvesters, sprayers, planters,
35 seeders, or spreaders. Precision farming equipment includes,
-34- LRB9105091PTmbccr2
1 but is not limited to, soil testing sensors, computers,
2 monitors, software, global positioning and mapping systems,
3 and other such equipment.
4 Farm machinery and equipment also includes computers,
5 sensors, software, and related equipment used primarily in
6 the computer-assisted operation of production agriculture
7 facilities, equipment, and activities such as, but not
8 limited to, the collection, monitoring, and correlation of
9 animal and crop data for the purpose of formulating animal
10 diets and agricultural chemicals. This item (7) is exempt
11 from the provisions of Section 3-55 3-75.
12 (8) Fuel and petroleum products sold to or used by an
13 air common carrier, certified by the carrier to be used for
14 consumption, shipment, or storage in the conduct of its
15 business as an air common carrier, for a flight destined for
16 or returning from a location or locations outside the United
17 States without regard to previous or subsequent domestic
18 stopovers.
19 (9) Proceeds of mandatory service charges separately
20 stated on customers' bills for the purchase and consumption
21 of food and beverages, to the extent that the proceeds of the
22 service charge are in fact turned over as tips or as a
23 substitute for tips to the employees who participate directly
24 in preparing, serving, hosting or cleaning up the food or
25 beverage function with respect to which the service charge is
26 imposed.
27 (10) Oil field exploration, drilling, and production
28 equipment, including (i) rigs and parts of rigs, rotary rigs,
29 cable tool rigs, and workover rigs, (ii) pipe and tubular
30 goods, including casing and drill strings, (iii) pumps and
31 pump-jack units, (iv) storage tanks and flow lines, (v) any
32 individual replacement part for oil field exploration,
33 drilling, and production equipment, and (vi) machinery and
34 equipment purchased for lease; but excluding motor vehicles
35 required to be registered under the Illinois Vehicle Code.
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1 (11) Photoprocessing machinery and equipment, including
2 repair and replacement parts, both new and used, including
3 that manufactured on special order, certified by the
4 purchaser to be used primarily for photoprocessing, and
5 including photoprocessing machinery and equipment purchased
6 for lease.
7 (12) Coal exploration, mining, offhighway hauling,
8 processing, maintenance, and reclamation equipment, including
9 replacement parts and equipment, and including equipment
10 purchased for lease, but excluding motor vehicles required to
11 be registered under the Illinois Vehicle Code.
12 (13) Food for human consumption that is to be consumed
13 off the premises where it is sold (other than alcoholic
14 beverages, soft drinks and food that has been prepared for
15 immediate consumption) and prescription and non-prescription
16 medicines, drugs, medical appliances, and insulin, urine
17 testing materials, syringes, and needles used by diabetics,
18 for human use, when purchased for use by a person receiving
19 medical assistance under Article 5 of the Illinois Public Aid
20 Code who resides in a licensed long-term care facility, as
21 defined in the Nursing Home Care Act.
22 (14) Semen used for artificial insemination of livestock
23 for direct agricultural production.
24 (15) Horses, or interests in horses, registered with and
25 meeting the requirements of any of the Arabian Horse Club
26 Registry of America, Appaloosa Horse Club, American Quarter
27 Horse Association, United States Trotting Association, or
28 Jockey Club, as appropriate, used for purposes of breeding or
29 racing for prizes.
30 (16) Computers and communications equipment utilized for
31 any hospital purpose and equipment used in the diagnosis,
32 analysis, or treatment of hospital patients sold to a lessor
33 who leases the equipment, under a lease of one year or longer
34 executed or in effect at the time of the purchase, to a
35 hospital that has been issued an active tax exemption
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1 identification number by the Department under Section 1g of
2 the Retailers' Occupation Tax Act.
3 (17) Personal property sold to a lessor who leases the
4 property, under a lease of one year or longer executed or in
5 effect at the time of the purchase, to a governmental body
6 that has been issued an active tax exemption identification
7 number by the Department under Section 1g of the Retailers'
8 Occupation Tax Act.
9 (18) Beginning with taxable years ending on or after
10 December 31, 1995 and ending with taxable years ending on or
11 before December 31, 2004, personal property that is donated
12 for disaster relief to be used in a State or federally
13 declared disaster area in Illinois or bordering Illinois by a
14 manufacturer or retailer that is registered in this State to
15 a corporation, society, association, foundation, or
16 institution that has been issued a sales tax exemption
17 identification number by the Department that assists victims
18 of the disaster who reside within the declared disaster area.
19 (19) Beginning with taxable years ending on or after
20 December 31, 1995 and ending with taxable years ending on or
21 before December 31, 2004, personal property that is used in
22 the performance of infrastructure repairs in this State,
23 including but not limited to municipal roads and streets,
24 access roads, bridges, sidewalks, waste disposal systems,
25 water and sewer line extensions, water distribution and
26 purification facilities, storm water drainage and retention
27 facilities, and sewage treatment facilities, resulting from a
28 State or federally declared disaster in Illinois or bordering
29 Illinois when such repairs are initiated on facilities
30 located in the declared disaster area within 6 months after
31 the disaster.
32 (20) Beginning January 1, 2000, new or used automatic
33 vending machines that prepare and serve hot food and
34 beverages, including coffee, soup, and other items, and
35 replacement parts for these machines. This paragraph is
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1 exempt from the provisions of Section 3-55.
2 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
3 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
4 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
5 eff. 12-12-97; 90-605, eff. 6-30-98; revised 2-10-99.)
6 Section 20. The Retailers' Occupation Tax Act is amended
7 by changing Section 2-5 as follows:
8 (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
9 Sec. 2-5. Exemptions. Gross receipts from proceeds from
10 the sale of the following tangible personal property are
11 exempt from the tax imposed by this Act:
12 (1) Farm chemicals.
13 (2) Farm machinery and equipment, both new and used,
14 including that manufactured on special order, certified by
15 the purchaser to be used primarily for production agriculture
16 or State or federal agricultural programs, including
17 individual replacement parts for the machinery and equipment,
18 including machinery and equipment purchased for lease, and
19 including implements of husbandry defined in Section 1-130 of
20 the Illinois Vehicle Code, farm machinery and agricultural
21 chemical and fertilizer spreaders, and nurse wagons required
22 to be registered under Section 3-809 of the Illinois Vehicle
23 Code, but excluding other motor vehicles required to be
24 registered under the Illinois Vehicle Code. Horticultural
25 polyhouses or hoop houses used for propagating, growing, or
26 overwintering plants shall be considered farm machinery and
27 equipment under this item (2). Agricultural chemical tender
28 tanks and dry boxes shall include units sold separately from
29 a motor vehicle required to be licensed and units sold
30 mounted on a motor vehicle required to be licensed, if the
31 selling price of the tender is separately stated.
32 Farm machinery and equipment shall include precision
33 farming equipment that is installed or purchased to be
-38- LRB9105091PTmbccr2
1 installed on farm machinery and equipment including, but not
2 limited to, tractors, harvesters, sprayers, planters,
3 seeders, or spreaders. Precision farming equipment includes,
4 but is not limited to, soil testing sensors, computers,
5 monitors, software, global positioning and mapping systems,
6 and other such equipment.
7 Farm machinery and equipment also includes computers,
8 sensors, software, and related equipment used primarily in
9 the computer-assisted operation of production agriculture
10 facilities, equipment, and activities such as, but not
11 limited to, the collection, monitoring, and correlation of
12 animal and crop data for the purpose of formulating animal
13 diets and agricultural chemicals. This item (7) is exempt
14 from the provisions of Section 2-70 3-75.
15 (3) Distillation machinery and equipment, sold as a unit
16 or kit, assembled or installed by the retailer, certified by
17 the user to be used only for the production of ethyl alcohol
18 that will be used for consumption as motor fuel or as a
19 component of motor fuel for the personal use of the user, and
20 not subject to sale or resale.
21 (4) Graphic arts machinery and equipment, including
22 repair and replacement parts, both new and used, and
23 including that manufactured on special order or purchased for
24 lease, certified by the purchaser to be used primarily for
25 graphic arts production.
26 (5) A motor vehicle of the first division, a motor
27 vehicle of the second division that is a self-contained motor
28 vehicle designed or permanently converted to provide living
29 quarters for recreational, camping, or travel use, with
30 direct walk through access to the living quarters from the
31 driver's seat, or a motor vehicle of the second division that
32 is of the van configuration designed for the transportation
33 of not less than 7 nor more than 16 passengers, as defined in
34 Section 1-146 of the Illinois Vehicle Code, that is used for
35 automobile renting, as defined in the Automobile Renting
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1 Occupation and Use Tax Act.
2 (6) Personal property sold by a teacher-sponsored
3 student organization affiliated with an elementary or
4 secondary school located in Illinois.
5 (7) Proceeds of that portion of the selling price of a
6 passenger car the sale of which is subject to the Replacement
7 Vehicle Tax.
8 (8) Personal property sold to an Illinois county fair
9 association for use in conducting, operating, or promoting
10 the county fair.
11 (9) Personal property sold to a not-for-profit music or
12 dramatic arts organization that establishes, by proof
13 required by the Department by rule, that it has received an
14 exemption under Section 501(c) (3) of the Internal Revenue
15 Code and that is organized and operated for the presentation
16 of live public performances of musical or theatrical works on
17 a regular basis.
18 (10) Personal property sold by a corporation, society,
19 association, foundation, institution, or organization, other
20 than a limited liability company, that is organized and
21 operated as a not-for-profit service enterprise for the
22 benefit of persons 65 years of age or older if the personal
23 property was not purchased by the enterprise for the purpose
24 of resale by the enterprise.
25 (11) Personal property sold to a governmental body, to a
26 corporation, society, association, foundation, or institution
27 organized and operated exclusively for charitable, religious,
28 or educational purposes, or to a not-for-profit corporation,
29 society, association, foundation, institution, or
30 organization that has no compensated officers or employees
31 and that is organized and operated primarily for the
32 recreation of persons 55 years of age or older. A limited
33 liability company may qualify for the exemption under this
34 paragraph only if the limited liability company is organized
35 and operated exclusively for educational purposes. On and
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1 after July 1, 1987, however, no entity otherwise eligible for
2 this exemption shall make tax-free purchases unless it has an
3 active identification number issued by the Department.
4 (12) Personal property sold to interstate carriers for
5 hire for use as rolling stock moving in interstate commerce
6 or to lessors under leases of one year or longer executed or
7 in effect at the time of purchase by interstate carriers for
8 hire for use as rolling stock moving in interstate commerce
9 and equipment operated by a telecommunications provider,
10 licensed as a common carrier by the Federal Communications
11 Commission, which is permanently installed in or affixed to
12 aircraft moving in interstate commerce.
13 (13) Proceeds from sales to owners, lessors, or shippers
14 of tangible personal property that is utilized by interstate
15 carriers for hire for use as rolling stock moving in
16 interstate commerce and equipment operated by a
17 telecommunications provider, licensed as a common carrier by
18 the Federal Communications Commission, which is permanently
19 installed in or affixed to aircraft moving in interstate
20 commerce.
21 (14) Machinery and equipment that will be used by the
22 purchaser, or a lessee of the purchaser, primarily in the
23 process of manufacturing or assembling tangible personal
24 property for wholesale or retail sale or lease, whether the
25 sale or lease is made directly by the manufacturer or by some
26 other person, whether the materials used in the process are
27 owned by the manufacturer or some other person, or whether
28 the sale or lease is made apart from or as an incident to the
29 seller's engaging in the service occupation of producing
30 machines, tools, dies, jigs, patterns, gauges, or other
31 similar items of no commercial value on special order for a
32 particular purchaser.
33 (15) Proceeds of mandatory service charges separately
34 stated on customers' bills for purchase and consumption of
35 food and beverages, to the extent that the proceeds of the
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1 service charge are in fact turned over as tips or as a
2 substitute for tips to the employees who participate directly
3 in preparing, serving, hosting or cleaning up the food or
4 beverage function with respect to which the service charge is
5 imposed.
6 (16) Petroleum products sold to a purchaser if the
7 seller is prohibited by federal law from charging tax to the
8 purchaser.
9 (17) Tangible personal property sold to a common carrier
10 by rail or motor that receives the physical possession of the
11 property in Illinois and that transports the property, or
12 shares with another common carrier in the transportation of
13 the property, out of Illinois on a standard uniform bill of
14 lading showing the seller of the property as the shipper or
15 consignor of the property to a destination outside Illinois,
16 for use outside Illinois.
17 (18) Legal tender, currency, medallions, or gold or
18 silver coinage issued by the State of Illinois, the
19 government of the United States of America, or the government
20 of any foreign country, and bullion.
21 (19) Oil field exploration, drilling, and production
22 equipment, including (i) rigs and parts of rigs, rotary rigs,
23 cable tool rigs, and workover rigs, (ii) pipe and tubular
24 goods, including casing and drill strings, (iii) pumps and
25 pump-jack units, (iv) storage tanks and flow lines, (v) any
26 individual replacement part for oil field exploration,
27 drilling, and production equipment, and (vi) machinery and
28 equipment purchased for lease; but excluding motor vehicles
29 required to be registered under the Illinois Vehicle Code.
30 (20) Photoprocessing machinery and equipment, including
31 repair and replacement parts, both new and used, including
32 that manufactured on special order, certified by the
33 purchaser to be used primarily for photoprocessing, and
34 including photoprocessing machinery and equipment purchased
35 for lease.
-42- LRB9105091PTmbccr2
1 (21) Coal exploration, mining, offhighway hauling,
2 processing, maintenance, and reclamation equipment, including
3 replacement parts and equipment, and including equipment
4 purchased for lease, but excluding motor vehicles required to
5 be registered under the Illinois Vehicle Code.
6 (22) Fuel and petroleum products sold to or used by an
7 air carrier, certified by the carrier to be used for
8 consumption, shipment, or storage in the conduct of its
9 business as an air common carrier, for a flight destined for
10 or returning from a location or locations outside the United
11 States without regard to previous or subsequent domestic
12 stopovers.
13 (23) A transaction in which the purchase order is
14 received by a florist who is located outside Illinois, but
15 who has a florist located in Illinois deliver the property to
16 the purchaser or the purchaser's donee in Illinois.
17 (24) Fuel consumed or used in the operation of ships,
18 barges, or vessels that are used primarily in or for the
19 transportation of property or the conveyance of persons for
20 hire on rivers bordering on this State if the fuel is
21 delivered by the seller to the purchaser's barge, ship, or
22 vessel while it is afloat upon that bordering river.
23 (25) A motor vehicle sold in this State to a nonresident
24 even though the motor vehicle is delivered to the nonresident
25 in this State, if the motor vehicle is not to be titled in
26 this State, and if a driveaway decal permit is issued to the
27 motor vehicle as provided in Section 3-603 of the Illinois
28 Vehicle Code or if the nonresident purchaser has vehicle
29 registration plates to transfer to the motor vehicle upon
30 returning to his or her home state. The issuance of the
31 driveaway decal permit or having the out-of-state
32 registration plates to be transferred is prima facie evidence
33 that the motor vehicle will not be titled in this State.
34 (26) Semen used for artificial insemination of livestock
35 for direct agricultural production.
-43- LRB9105091PTmbccr2
1 (27) Horses, or interests in horses, registered with and
2 meeting the requirements of any of the Arabian Horse Club
3 Registry of America, Appaloosa Horse Club, American Quarter
4 Horse Association, United States Trotting Association, or
5 Jockey Club, as appropriate, used for purposes of breeding or
6 racing for prizes.
7 (28) Computers and communications equipment utilized for
8 any hospital purpose and equipment used in the diagnosis,
9 analysis, or treatment of hospital patients sold to a lessor
10 who leases the equipment, under a lease of one year or longer
11 executed or in effect at the time of the purchase, to a
12 hospital that has been issued an active tax exemption
13 identification number by the Department under Section 1g of
14 this Act.
15 (29) Personal property sold to a lessor who leases the
16 property, under a lease of one year or longer executed or in
17 effect at the time of the purchase, to a governmental body
18 that has been issued an active tax exemption identification
19 number by the Department under Section 1g of this Act.
20 (30) Beginning with taxable years ending on or after
21 December 31, 1995 and ending with taxable years ending on or
22 before December 31, 2004, personal property that is donated
23 for disaster relief to be used in a State or federally
24 declared disaster area in Illinois or bordering Illinois by a
25 manufacturer or retailer that is registered in this State to
26 a corporation, society, association, foundation, or
27 institution that has been issued a sales tax exemption
28 identification number by the Department that assists victims
29 of the disaster who reside within the declared disaster area.
30 (31) Beginning with taxable years ending on or after
31 December 31, 1995 and ending with taxable years ending on or
32 before December 31, 2004, personal property that is used in
33 the performance of infrastructure repairs in this State,
34 including but not limited to municipal roads and streets,
35 access roads, bridges, sidewalks, waste disposal systems,
-44- LRB9105091PTmbccr2
1 water and sewer line extensions, water distribution and
2 purification facilities, storm water drainage and retention
3 facilities, and sewage treatment facilities, resulting from a
4 State or federally declared disaster in Illinois or bordering
5 Illinois when such repairs are initiated on facilities
6 located in the declared disaster area within 6 months after
7 the disaster.
8 (32) Beginning January 1, 2000, new or used automatic
9 vending machines that prepare and serve hot food and
10 beverages, including coffee, soup, and other items, and
11 replacement parts for these machines. This paragraph is
12 exempt from the provisions of Section 2-70.
13 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
14 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
15 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-519,
16 eff. 6-1-98; 90-552, eff. 12-12-97; 90-605, eff. 6-30-98;
17 revised 2-10-99.)
18 Section 25. The Property Tax Code is amended by changing
19 Section 18-165 as follows:
20 (35 ILCS 200/18-165)
21 Sec. 18-165. Abatement of taxes.
22 (a) Any taxing district, upon a majority vote of its
23 governing authority, may, after the determination of the
24 assessed valuation of its property, order the clerk of that
25 county to abate any portion of its taxes on the following
26 types of property:
27 (1) Commercial and industrial.
28 (A) The property of any commercial or
29 industrial firm, including but not limited to the
30 property of any firm that is used for collecting,
31 separating, storing, or processing recyclable
32 materials, locating within the taxing district
33 during the immediately preceding year from another
-45- LRB9105091PTmbccr2
1 state, territory, or country, or having been newly
2 created within this State during the immediately
3 preceding year, or expanding an existing facility.
4 The abatement shall not exceed a period of 10 years
5 and the aggregate amount of abated taxes for all
6 taxing districts combined shall not exceed
7 $4,000,000; or
8 (B) The property of any commercial or
9 industrial development of at least 500 acres having
10 been created within the taxing district. The
11 abatement shall not exceed a period of 20 years and
12 the aggregate amount of abated taxes for all taxing
13 districts combined shall not exceed $12,000,000.
14 (C) The property of any commercial or
15 industrial firm currently located in the taxing
16 district that expands a facility or its number of
17 employees. The abatement shall not exceed a period
18 of 10 years and the aggregate amount of abated taxes
19 for all taxing districts combined shall not exceed
20 $4,000,000. The abatement period may be renewed at
21 the option of the taxing districts.
22 (2) Horse racing. Any property in the taxing
23 district which is used for the racing of horses and upon
24 which capital improvements consisting of expansion,
25 improvement or replacement of existing facilities have
26 been made since July 1, 1987. The combined abatements
27 for such property from all taxing districts in any county
28 shall not exceed $5,000,000 annually and shall not exceed
29 a period of 10 years.
30 (3) Auto racing. Any property designed exclusively
31 for the racing of motor vehicles. Such abatement shall
32 not exceed a period of 10 years.
33 (4) Academic or research institute. The property
34 of any academic or research institute in the taxing
35 district that (i) is an exempt organization under
-46- LRB9105091PTmbccr2
1 paragraph (3) of Section 501(c) of the Internal Revenue
2 Code, (ii) operates for the benefit of the public by
3 actually and exclusively performing scientific research
4 and making the results of the research available to the
5 interested public on a non-discriminatory basis, and
6 (iii) employs more than 100 employees. An abatement
7 granted under this paragraph shall be for at least 15
8 years and the aggregate amount of abated taxes for all
9 taxing districts combined shall not exceed $5,000,000.
10 (5) Housing for older persons. Any property in the
11 taxing district that is devoted exclusively to affordable
12 housing for older households. For purposes of this
13 paragraph, "older households" means those households (i)
14 living in housing provided under any State or federal
15 program that the Department of Human Rights determines is
16 specifically designed and operated to assist elderly
17 persons and is solely occupied by persons 55 years of age
18 or older and (ii) whose annual income does not exceed 80%
19 of the area gross median income, adjusted for family
20 size, as such gross income and median income are
21 determined from time to time by the United States
22 Department of Housing and Urban Development. The
23 abatement shall not exceed a period of 15 years, and the
24 aggregate amount of abated taxes for all taxing districts
25 shall not exceed $3,000,000.
26 (6) Historical society. For assessment years 1998
27 through 2000, the property of an historical society
28 qualifying as an exempt organization under Section
29 501(c)(3) of the federal Internal Revenue Code.
30 (b) Upon a majority vote of its governing authority, any
31 municipality may, after the determination of the assessed
32 valuation of its property, order the county clerk to abate
33 any portion of its taxes on any property that is located
34 within the corporate limits of the municipality in accordance
35 with Section 8-3-18 of the Illinois Municipal Code.
-47- LRB9105091PTmbccr2
1 (Source: P.A. 89-561, eff. 1-1-97; 90-46, eff. 7-3-97;
2 90-415, eff. 8-15-97; 90-568, eff. 1-1-99; 90-655, eff.
3 7-30-98.)
4 Section 99. Effective date. This Act takes effect upon
5 becoming law.".
6 Submitted on May 27, 1999
7 s/Sen. Chris Lauzen s/Rep. Barbara Flynn Currie
8 s/Sen. William Peterson Rep. Coy Pugh
9 Sen. Beverly Fawell s/Rep. Kevin McCarthy
10 Sen. James Clayborne s/Rep. Art Tenhouse
11 s/Sen. Patrick Welch s/Rep. Bog Biggins
12 Committee for the Senate Committee for the House