SB0210 103RD GENERAL ASSEMBLY

LRB103 26390 HLH 52753 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB0210

Introduced 1/31/2023, by Sen. Laura M. Murphy

SYNOPSIS AS INTRODUCED:

35 ILCS 5/234 new

Amends the Illinois Income Tax Act. Provides that a taxpayer who may claim a qualifying student as a dependent is allowed a credit of up to $2,000 for qualified tuition and fee expenses paid by the taxpayer. Provides that the term qualifying student means a person who (i) is a resident of the State, (ii) is under the age of 24 at the close of the school year for which a credit is sought, and (iii) during the school year for which a credit is sought, is a full-time student enrolled in a program at a qualifying college or university. Effective immediately.

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 234 as follows:

(35 ILCS 5/234 new)

Sec. 234. College tuition expense credit.

(a) For taxable years ending on or after December 31, 2023, a taxpayer who may claim one or more qualifying students as a dependent shall be allowed a credit up to $2,000 against the tax imposed by subsections (a) and (b) of this Section for qualified tuition and fee expenses paid by the taxpayer during the taxable year on behalf of the qualifying student or students.

(b) 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 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.

(c) For the purpose of this Section:

"Qualifying college or university" means any public or private university, community college, vocational school, or other postsecondary educational institution that is physically located in the State and is eligible to participate in a student loan program administered by the United States Department of Education.

"Qualifying student" means an individual who (i) is a resident of the State, (ii) is under the age of 24 at the close of the school year for which a credit is sought, and (iii) during the school year for which a credit is sought, is a full-time student enrolled in a program at a qualifying college or university at which the student is enrolled.

"Qualified tuition and fee expense" means the amount incurred by on behalf of a qualifying student for tuition, book fees, and lab fees at the qualifying college of university at which the student is enrolled.

(d) Notwithstanding any other provision of law, no taxpayer may claim a credit under this Section if the taxpayer's adjusted gross income for the taxable year exceeds (i) $250,000, in the case of spouses filing a joint federal tax return or (ii) $125,000, in the case of all other taxpayers.

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

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