HB5430 101ST GENERAL ASSEMBLY

LRB101 18949 HLH 68408 b

101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB5430

Introduced , by Rep. Grant Wehrli - Deanne M. Mazzochi - Amy Grant, Lindsay Parkhurst and Tom Weber

SYNOPSIS AS INTRODUCED:

35 ILCS 5/232 new

Amends the Illinois Income Tax Act. Creates a credit for individual taxpayers whose income does not exceed the maximum income limitation and who are (i) 65 years of age or older during the taxable year or (ii) 100% disabled during the taxable year. Provides that the amount of the credit shall be based upon the amount by which the total residential property taxes paid by the taxpayer during the taxable year exceeds a stated percent of income. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT 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 232 as follows:

(35 ILCS 5/232 new)

Sec. 232. Supplemental property tax credit.

(a) In addition to any other credit allowed under this Act, for taxable years ending on or after December 31, 2021, an individual taxpayer whose income does not exceed the maximum income limitation and who is (i) 65 years of age or older during the taxable year or (ii) 100% disabled during the taxable year is entitled to a credit against the taxes imposed by subsections (a) and (b) of Section 201 as provided in this Section.

(b) The amount of the credit shall be determined from a table of credits to be prepared by the Department based upon the amount by which the total residential property taxes paid by the taxpayer during the taxable year exceeds the percent of income in the following list:

(1) if the taxpayer's adjusted gross income is not more than the base amount, then the percent is zero percent; and

(2) if the taxpayer's adjusted gross income is more than the base amount, then the percent is 1/16% accumulative per $300 from 0% to 4%.

Each credit calculated under this subsection (b) shall be rounded to the nearest whole dollar. In no event may the credit exceed $750 in rent constituting property taxes actually paid or $1,100 in actual property tax paid. If a claimant occupies 2 or more different homesteads in the same calendar year, and one homestead is calculated by rent constituting property taxes and the other homestead is calculated by actual property taxes paid, then the maximum credit shall be: (i) $750 multiplied by a fraction the numerator of which is the number of days during the taxable year in which the claimant occupied a homestead calculated by rent constituting property taxes and the denominator of which is 365; plus (ii) $1,100 multiplied by a fraction the numerator of which is the number of days during the taxable year in which the claimant occupied a homestead calculated by actual property taxes paid and the denominator of which is 365.

(c) As used in this Section:

"Accumulative" means an increase by continuous or repeated application of the percent to the income increment at each $300 level.

"Base amount" means $14,300.

"Gross rent" means the amount paid by a claimant to a landlord for the rental, at arm's length, of a homestead during the calendar year, exclusive of charges for health and personal care services and food furnished as part of the rental agreement, whether or not expressly set out in the rental agreement. If the Department determines that the landlord and tenant have not dealt at arm's length, and that the gross rent is excessive, then he shall determine the gross rent based upon a reasonable amount of rent. Gross rent shall be deemed to be paid only if actually paid prior to the date a return is filed. The Department may adopt rules requiring a return of information by a landlord receiving rent, certifying for a calendar year the amount of gross rent received from a tenant claiming a property tax credit and shall, by rule, provide a method for certification by the claimant of the amount of gross rent paid for any calendar year for which a claim is made. The Department may require a landlord or a tenant or both to provide data relating to health and personal care services and to food. Neither a landlord nor a tenant may be required to provide data relating to utilities, furniture, home furnishings or appliances.

"Maximum income limitation" means $30,000.

"Rent constituting property taxes accrued" means 20% of the gross rent paid by a claimant and spouse in the calendar year.

"Total residential property taxes" means property taxes paid, exclusive of special assessments, penalties, interest, and charges for service levied on a claimant's homestead in any calendar year. Property taxes shall qualify for the credit only if actually paid prior to the date a return is filed. The Department shall require a tax receipt or other proof of property tax payment. If a homestead is owned only partially by claimant, then "property taxes accrued" is that part of property taxes levied on the homestead which was actually paid by the claimant. If a claimant owns and occupies 2 or more different homesteads in the same calendar year, property taxes accrued shall be the sum of taxes paid by the claimant and allocable to those several properties occupied by the claimant as a homestead for the year.

(d) In no event shall a credit under this Section reduce a taxpayer's liability to less than zero. If the amount of credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability for 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 liability, the earlier credit shall be applied first.

(e) This Section is exempt from Section 250.

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