Illinois General Assembly - Full Text of HB4703
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Full Text of HB4703  100th General Assembly

HB4703 100TH GENERAL ASSEMBLY

  
  

 


 
100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB4703

 

Introduced , by Rep. Michael Halpin

 

SYNOPSIS AS INTRODUCED:
 
New Act
35 ILCS 5/227 new

    Creates the Historic Preservation Tax Credit Supplemental Pilot Program Act. Provides that an income tax credit is granted to an eligible taxpayer who makes expenditures pursuant to a qualified rehabilitation plan for the rehabilitation of a historic structure located in Rock Island County. Provides that the credit is available for taxable years beginning on or after January 1, 2019 and ending on or before December 31, 2029. Provides that the credit is equal to 25% of the amount of the eligible expenditure. Contains provisions concerning eligible expenditures. Provides that eligible taxpayers must apply with the Department of Commerce and Economic Opportunity within 6 months after the effective date of the Act. Provides that the credit may be carried forward for up to 10 years and may be carried back for up to 3 years. Amends the Illinois Income Tax Act to make conforming changes. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB4703LRB100 17457 HLH 32626 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Historic Preservation Tax Credit Supplemental Pilot Program
6Act.
 
7    Section 5. Definitions. As used in this Act, unless the
8context clearly indicates otherwise:
9    "Agency" means the Historic Preservation Agency.
10    "Department" means the Department of Commerce and Economic
11Opportunity.
12    "Qualified expenditures" means all the costs and expenses
13defined as qualified rehabilitation expenditures under Section
1447 of the federal Internal Revenue Code which were incurred in
15connection with a qualified historic structure.
16    "Qualified historic structure" means any structure that is
17located in Rock Island County and that is defined as a
18certified historic structure under Section 47 (c)(3) of the
19federal Internal Revenue Code.
20    "Qualified rehabilitation plan" means a project that is
21approved by the Agency as being consistent with the standards
22in effect on the effective date of this Act for rehabilitation
23as adopted by the federal Secretary of the Interior.

 

 

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1    "Qualified taxpayer" means the owner of the qualified
2historic structure or any other person who may qualify for the
3federal rehabilitation credit allowed by Section 47 of the
4federal Internal Revenue Code. If the taxpayer is (i) a
5corporation having an election in effect under Subchapter S of
6the federal Internal Revenue Code, (ii) a partnership, or (iii)
7a limited liability company, the credit provided under this Act
8may be claimed by the shareholders of the corporation, the
9partners of the partnership, or the members of the limited
10liability company in the same manner as those shareholders,
11partners, or members account for their proportionate shares of
12the income or losses of the corporation, partnership, or
13limited liability company, or as provided in the by-laws or
14other executed agreement of the corporation, partnership, or
15limited liability company. Credits granted to a partnership, a
16limited liability company taxed as a partnership, or other
17multiple owners of property shall be passed through to the
18partners, members, or owners respectively on a pro rata basis
19or pursuant to an executed agreement among the partners,
20members, or owners documenting any alternate distribution
21method.
 
22    Section 10. Allowable credit. To the extent authorized by
23this Act, for taxable years beginning on or after January 1,
242019 and ending on or before December 31, 2029, there shall be
25allowed a tax credit against the tax imposed by subsections (a)

 

 

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1and (b) of Section 201 of the Illinois Income Tax Act in an
2amount equal to 25% of qualified expenditures incurred by a
3qualified taxpayer during the taxable year in the restoration
4and preservation of a qualified historic structure pursuant to
5a qualified rehabilitation plan, provided that the total amount
6of such expenditures (i) must equal $5,000 or more, and (ii)
7must exceed 50% of the purchase price of the property. If the
8amount of any tax credit awarded under this Act exceeds the
9qualified taxpayer's income tax liability for the year in which
10the qualified rehabilitation plan was placed in service, the
11excess amount may be carried forward for deduction from the
12taxpayer's income tax liability in the next succeeding year or
13years until the total amount of the credit has been used,
14except that a credit may not be carried forward for deduction
15after the tenth taxable year after the taxable year in which
16the qualified rehabilitation plan was placed in service. To
17obtain a tax credit pursuant to this Act, an application must
18be made to the Department no later than 6 months after the
19effective date of this Act. The Department, in consultation
20with the Agency, shall determine the amount of eligible
21rehabilitation costs and expenses. The Agency shall determine
22whether the rehabilitation is consistent with the standards of
23the Secretary of the United States Department of the Interior
24for rehabilitation. Upon completion and review of the project,
25the Department shall issue a certificate in the amount of the
26eligible credits. At the time the certificate is issued, an

 

 

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1issuance fee up to the maximum amount of 2% of the amount of
2the credits issued by the certificate may be collected from the
3applicant to administer the Act. If collected, this issuance
4fee shall be evenly divided between the Department and the
5Agency. The taxpayer must attach the certificate to the tax
6return on which the credits are to be claimed.
 
7    Section 15. Transfer of credits. Any qualified taxpayer,
8referred to in this Section as the assignor, may sell, assign,
9convey, or otherwise transfer tax credits allowed and earned
10under this Act. The taxpayer acquiring the credits, referred to
11in this Section as the assignee, may use the amount of the
12acquired credits to offset up to 100% of its income tax
13liability for either the taxable year in which the qualified
14rehabilitation plan was first placed into service or the
15taxable year in which such acquisition was made. Unused credit
16amounts claimed by the assignee may be carried forward for up
17to 10 years or carried back for up to 3 years, except that all
18credits must be claimed within 10 years after the tax year in
19which the qualified rehabilitation plan was first placed into
20service and may not be carried back to a tax year prior to the
21tax year in which the credit was issued. The assignor shall
22enter into a written agreement with the assignee establishing
23the terms and conditions of the agreement and shall perfect the
24transfer by notifying the Department in writing within 90
25calendar days after the effective date of the transfer and

 

 

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1shall provide any information as may be required by the
2Department to administer and carry out the provisions of this
3Section. If credits that have been transferred are subsequently
4reduced, adjusted, or recaptured, in whole or in part, by the
5Department, the Department of Revenue, or any other applicable
6government agency, only the original qualified taxpayer that
7was awarded the credits, and not any subsequent assignee of the
8credits, shall be held liable to repay any amount of such
9reduction, adjustment, or recapture of the credits.
 
10    Section 25. Pilot program; report. The Department may award
11no more than an aggregate of $10,000,000 in total annual tax
12credits pursuant to qualified rehabilitation plans for
13qualified historic structures. On or before December 31, 2019
14and on or before December 31 of each year thereafter through
152029, the Department must submit a report to the General
16Assembly evaluating the effectiveness of this Act in
17stimulating economic revitalization in the pilot program area.
 
18    Section 30. Powers. The Department and the Agency shall
19adopt rules for the administration of this Act.
 
20    Section 90. The Illinois Income Tax Act is amended by
21adding Section 227 as follows:
 
22    (35 ILCS 5/227 new)

 

 

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1    Sec. 227. Historic preservation supplemental credit. For
2tax years beginning on or after January 1, 2019 and ending on
3or before December 31, 2029, a taxpayer who qualifies for a
4credit under the Historic Preservation Tax Credit Supplemental
5Pilot Program Act is entitled to a credit against the taxes
6imposed under subsections (a) and (b) of Section 201 of this
7Act as provided in that Act. If the taxpayer is a partnership
8or Subchapter S corporation, the credit shall be allowed to the
9partners or shareholders in accordance with the determination
10of income and distributive share of income under Sections 702
11and 704 and Subchapter S of the Internal Revenue Code.
12    If the amount of any tax credit awarded under this Section
13exceeds the qualified taxpayer's income tax liability for the
14year in which the qualified rehabilitation plan was placed in
15service, the excess amount may be carried forward or back as
16provided in the Historic Preservation Tax Credit Supplemental
17Pilot Program Act.
 
18    Section 99. Effective date. This Act takes effect upon
19becoming law.