SB0081enr 100TH GENERAL ASSEMBLY

SB0081 Enrolled LRB100 06367 KTG 16406 b

AN ACT concerning employment.

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 changing Section 704A as follows:

(35 ILCS 5/704A)

Sec. 704A. Employer's return and payment of tax withheld.

(a) In general, every employer who deducts and withholds or is required to deduct and withhold tax under this Act on or after January 1, 2008 shall make those payments and returns as provided in this Section.

(b) Returns. Every employer shall, in the form and manner required by the Department, make returns with respect to taxes withheld or required to be withheld under this Article 7 for each quarter beginning on or after January 1, 2008, on or before the last day of the first month following the close of that quarter.

(c) Payments. With respect to amounts withheld or required to be withheld on or after January 1, 2008:

(1) Semi-weekly payments. For each calendar year, each employer who withheld or was required to withhold more than $12,000 during the one-year period ending on June 30 of the immediately preceding calendar year, payment must be made:

(A) on or before each Friday of the calendar year, for taxes withheld or required to be withheld on the immediately preceding Saturday, Sunday, Monday, or Tuesday;

(B) on or before each Wednesday of the calendar year, for taxes withheld or required to be withheld on the immediately preceding Wednesday, Thursday, or Friday.

Beginning with calendar year 2011, payments made under this paragraph (1) of subsection (c) must be made by electronic funds transfer.

(2) Semi-weekly payments. Any employer who withholds or is required to withhold more than $12,000 in any quarter of a calendar year is required to make payments on the dates set forth under item (1) of this subsection (c) for each remaining quarter of that calendar year and for the subsequent calendar year.

(3) Monthly payments. Each employer, other than an employer described in items (1) or (2) of this subsection, shall pay to the Department, on or before the 15th day of each month the taxes withheld or required to be withheld during the immediately preceding month.

(4) Payments with returns. Each employer shall pay to the Department, on or before the due date for each return required to be filed under this Section, any tax withheld or required to be withheld during the period for which the return is due and not previously paid to the Department.

(d) Regulatory authority. The Department may, by rule:

(1) Permit employers, in lieu of the requirements of subsections (b) and (c), to file annual returns due on or before January 31 of the year for taxes withheld or required to be withheld during the previous calendar year and, if the aggregate amounts required to be withheld by the employer under this Article 7 (other than amounts required to be withheld under Section 709.5) do not exceed $1,000 for the previous calendar year, to pay the taxes required to be shown on each such return no later than the due date for such return.

(2) Provide that any payment required to be made under subsection (c)(1) or (c)(2) is deemed to be timely to the extent paid by electronic funds transfer on or before the due date for deposit of federal income taxes withheld from, or federal employment taxes due with respect to, the wages from which the Illinois taxes were withheld.

(3) Designate one or more depositories to which payment of taxes required to be withheld under this Article 7 must be paid by some or all employers.

(4) Increase the threshold dollar amounts at which employers are required to make semi-weekly payments under subsection (c)(1) or (c)(2).

(e) Annual return and payment. Every employer who deducts and withholds or is required to deduct and withhold tax from a person engaged in domestic service employment, as that term is defined in Section 3510 of the Internal Revenue Code, may comply with the requirements of this Section with respect to such employees by filing an annual return and paying the taxes required to be deducted and withheld on or before the 15th day of the fourth month following the close of the employer's taxable year. The Department may allow the employer's return to be submitted with the employer's individual income tax return or to be submitted with a return due from the employer under Section 1400.2 of the Unemployment Insurance Act.

(f) Magnetic media and electronic filing. Any W-2 Form that, under the Internal Revenue Code and regulations promulgated thereunder, is required to be submitted to the Internal Revenue Service on magnetic media or electronically must also be submitted to the Department on magnetic media or electronically for Illinois purposes, if required by the Department.

(g) For amounts deducted or withheld after December 31, 2009, a taxpayer who makes an election under subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act for a taxable year shall be allowed a credit against payments due under this Section for amounts withheld during the first calendar year beginning after the end of that taxable year equal to the amount of the credit for the incremental income tax attributable to full-time employees of the taxpayer awarded to the taxpayer by the Department of Commerce and Economic Opportunity under the Economic Development for a Growing Economy Tax Credit Act for the taxable year and credits not previously claimed and allowed to be carried forward under Section 211(4) of this Act as provided in subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act. The credit or credits may not reduce the taxpayer's obligation for any payment due under this Section to less than zero. If the amount of the credit or credits exceeds the total payments due under this Section with respect to amounts withheld during the calendar year, the excess may be carried forward and applied against the taxpayer's liability under this Section in the succeeding calendar years as allowed to be carried forward under paragraph (4) of Section 211 of this Act. The credit or credits shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one taxable year that are available to offset a liability, the earlier credit shall be applied first. Each employer who deducts and withholds or is required to deduct and withhold tax under this Act and who retains income tax withholdings under subsection (f) of Section 5-15 of the Economic Development for a Growing Economy Tax Credit Act must make a return with respect to such taxes and retained amounts in the form and manner that the Department, by rule, requires and pay to the Department or to a depositary designated by the Department those withheld taxes not retained by the taxpayer. For purposes of this subsection (g), the term taxpayer shall include taxpayer and members of the taxpayer's unitary business group as defined under paragraph (27) of subsection (a) of Section 1501 of this Act. This Section is exempt from the provisions of Section 250 of this Act.

(h) An employer may claim a credit against payments due under this Section for amounts withheld during the first calendar year ending after the date on which a tax credit certificate was issued under Section 35 of the Small Business Job Creation Tax Credit Act. The credit shall be equal to the amount shown on the certificate, but may not reduce the taxpayer's obligation for any payment due under this Section to less than zero. If the amount of the credit exceeds the total payments due under this Section with respect to amounts withheld during the calendar year, the excess may be carried forward and applied against the taxpayer's liability under this Section in the 5 succeeding calendar years. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one calendar year that are available to offset a liability, the earlier credit shall be applied first. This Section is exempt from the provisions of Section 250 of this Act.

(i) Each employer that does not employ more than 50 employees at any time during the applicable payment period may claim a credit against payments due under this Section for each qualified employee, in an amount equal to the maximum credit multiplied by the number of hours the employee worked during the reporting period. The credit or credits may be taken against payments due for reporting periods that begin on or after January 1, 2018 and end on or before either: (1) December 31, 2025 for employers that employ more than 5 employees during the applicable payment period; or (2) December 31, 2027 for employers that employ no more than 5 employees during the applicable payment period. An employer may not claim a credit for an employee who has worked less than 90 consecutive days immediately preceding the reporting period; however, such credits may accrue during that 90-day period and be claimed against payments under this Section for future reporting periods after the employee has worked for the employer at least 90 consecutive days.

For each reporting period, the employer may not claim a credit or credits for more employees than the number of employees making less than the minimum or reduced wage for the current calendar year during the last reporting period of the preceding calendar year. Notwithstanding any other provision of this subsection, an employer shall not be eligible for credits for a reporting period unless the average wage paid by the employer per employee for all employees making less than $55,000 during the reporting period is greater than the average wage paid by the employer per employee for all employees making less than $55,000 during the same reporting period of the prior calendar year.

The credit or credits may not reduce the employer's obligation for any payment due under this Section by more than (i) 25% for reporting periods that begin during calendar year 2018, (ii) 20% for reporting periods that begin during calendar year 2019, (iii) 15% for reporting periods that begin during calendar year 2020, (iv) 10% for reporting periods that begin during calendar year 2021, and (v) 5% for reporting periods that begin during calendar year 2022. For calendar years 2023 through (1) December 31, 2025 for employers that employ more than 5 employees during the applicable payment period or (2) December 31, 2027 for employers that employ no more than 5 employees during the applicable payment period, the total amount of credits awarded to a taxpayer in each calendar year shall be equal to the total amount of credits awarded to that taxpayer in calendar year 2022. The taxpayer may apply all or a portion of the total credit amount for any such calendar year to any reporting period or periods in that calendar year, provided that the total amount of credits claimed by the taxpayer in that taxable year does not exceed the total amount of credits awarded to that taxpayer in calendar year 2022. Each employer who deducts and withholds or is required to deduct and withhold tax under this Act and who retains income tax withholdings under this subsection must make a return with respect to such taxes and retained amounts in the form and manner that the Department, by rule, requires and pay to the Department or to a depositary designated by the Department those withheld taxes not retained by the employer.

For the purposes of this subsection (i):

(1) "Category of employee" means:

(A) employees who are under 18 years of age;

(B) employees who are 18 years of age or older, but who qualify for a reduced minimum wage as provided under paragraph (2) of subsection (a) of Section 4 of the Minimum Wage Law;

(C) employees who are engaged in an occupation in which gratuities have customarily and usually constituted, and have been recognized as part of, the remuneration for hire purposes, as provided in subsection (c) of Section 4 of the Minimum Wage Law;

(D) employees who are 18 years of age or older, but who qualify for a reduced minimum wage under Section 5 of the Minimum Wage Law;

(E) employees who are 18 years of age or older, but who qualify for a reduced minimum wage under Section 6 of the Minimum Wage Law; and

(F) employees who are 18 years of age or older and do not qualify under paragraph (B), (C), (D), or (E) of this item (1).

(2) "Employer" and "employee" have the meanings ascribed to those terms in the Minimum Wage Law, except that "employee" also includes employees who work for an employer employing fewer than 4 employees. "Employer" does not include an employer that owns or operates 4 or more establishments in the aggregate nationally pursuant to a franchise agreement.

(3) "Maximum credit" means: (A) $0.45 per hour for qualified employees for whom the employer receives an allowance for gratuities under subsection (c) of Section 4 of the Minimum Wage Law; (B) $0.53 per hour for employees who receive a reduced minimum wage under Section 6 of the Minimum Wage Law; and (C) $0.75 per hour for all other qualified employees.

(4) "Qualified employee" means an employee who: (i) makes no more per hour than an amount equal to the minimum wage or reduced minimum wage for that category of employee plus $0.25; and (ii) has an average wage paid per hour by the employer during the reporting period equal to or greater than his or her average wage paid per hour by the employer during each reporting period for the immediately preceding 12 months.

(Source: P.A. 96-834, eff. 12-14-09; 96-888, eff. 4-13-10; 96-905, eff. 6-4-10; 96-1027, eff. 7-12-10; 97-333, eff. 8-12-11; 97-507, eff. 8-23-11.)

Section 10. The Minimum Wage Law is amended by changing Section 4 as follows:

(820 ILCS 105/4) (from Ch. 48, par. 1004)

Sec. 4. (a)(1) Every employer shall pay to each of his employees in every occupation wages of not less than $2.30 per hour or in the case of employees under 18 years of age wages of not less than $1.95 per hour, except as provided in Sections 5 and 6 of this Act, and on and after January 1, 1984, every employer shall pay to each of his employees in every occupation wages of not less than $2.65 per hour or in the case of employees under 18 years of age wages of not less than $2.25 per hour, and on and after October 1, 1984 every employer shall pay to each of his employees in every occupation wages of not less than $3.00 per hour or in the case of employees under 18 years of age wages of not less than $2.55 per hour, and on or after July 1, 1985 every employer shall pay to each of his employees in every occupation wages of not less than $3.35 per hour or in the case of employees under 18 years of age wages of not less than $2.85 per hour, and from January 1, 2004 through December 31, 2004 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $5.50 per hour, and from January 1, 2005 through June 30, 2007 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $6.50 per hour, and from July 1, 2007 through June 30, 2008 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $7.50 per hour, and from July 1, 2008 through June 30, 2009 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $7.75 per hour, and from July 1, 2009 through June 30, 2010 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $8.00 per hour, and from on and after July 1, 2010 through December 31, 2017 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $8.25 per hour, and from January 1, 2018 to December 31, 2018 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $9 per hour, and from January 1, 2019 to December 31, 2019 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $10 per hour, and from January 1, 2020 to December 31, 2020 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $11.25 per hour, and from January 1, 2021 to December 31, 2021 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $13 per hour, and on and after January 1, 2022 every employer shall pay to each of his or her employees who is 18 years of age or older in every occupation wages of not less than $15 per hour.

(2) Unless an employee's wages are reduced under Section 6, then in lieu of the rate prescribed in item (1) of this subsection (a), an employer may pay an employee who is 18 years of age or older, during the first 90 consecutive calendar days after the employee is initially employed by the employer, a wage that is not more than 50˘ less than the wage prescribed in item (1) of this subsection (a); however, an employer shall pay not less than the rate prescribed in item (1) of this subsection (a) to:

(A) a day or temporary laborer, as defined in Section 5 of the Day and Temporary Labor Services Act, who is 18 years of age or older; and

(B) an employee who is 18 years of age or older and whose employment is occasional or irregular and requires not more than 90 days to complete.

(3) On or before December 31, 2017, at At no time shall the wages paid to any employee under 18 years of age be more than 50˘ less than the wage required to be paid to employees who are at least 18 years of age under item (1) of this subsection (a). Beginning on or after January 1, 2018, every employer shall pay to each of his or her employees who is under 18 years of age that has worked more than 650 hours for the employer during any calendar year a wage not less than the wage required for employees who are 18 years of age or older under paragraph (1) of subsection (a) of Section 4 of this Law. Every employer shall pay to each of his or her employees who is under 18 years of age that has not worked more than 650 hours for the employer during any calendar year: (1) $8 per hour from January 1, 2018 to December 31, 2018; (2) $8.50 per hour from January 1, 2019 to December 31, 2019; (3) $9.25 per hour from January 1, 2020 to December 31, 2020; (4) $10.50 per hour from January 1, 2021 to December 31, 2021; and (5) $12 per hour on and after January 1, 2022.

(b) No employer shall discriminate between employees on the basis of sex or mental or physical disability, except as otherwise provided in this Act by paying wages to employees at a rate less than the rate at which he pays wages to employees for the same or substantially similar work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, except where such payment is made pursuant to (1) a seniority system; (2) a merit system; (3) a system which measures earnings by quantity or quality of production; or (4) a differential based on any other factor other than sex or mental or physical disability, except as otherwise provided in this Act.

(c) Every employer of an employee engaged in an occupation in which gratuities have customarily and usually constituted and have been recognized as part of the remuneration for hire purposes is entitled to an allowance for gratuities as part of the hourly wage rate provided in Section 4, subsection (a) in an amount not to exceed 40% of the applicable minimum wage rate. The Director shall require each employer desiring an allowance for gratuities to provide substantial evidence that the amount claimed, which may not exceed 40% of the applicable minimum wage rate, was received by the employee in the period for which the claim of exemption is made, and no part thereof was returned to the employer.

(d) No camp counselor who resides on the premises of a seasonal camp of an organized not-for-profit corporation shall be subject to the adult minimum wage if the camp counselor (1) works 40 or more hours per week, and (2) receives a total weekly salary of not less than the adult minimum wage for a 40-hour week. If the counselor works less than 40 hours per week, the counselor shall be paid the minimum hourly wage for each hour worked. Every employer of a camp counselor under this subsection is entitled to an allowance for meals and lodging as part of the hourly wage rate provided in Section 4, subsection (a), in an amount not to exceed 25% of the minimum wage rate.

(e) A camp counselor employed at a day camp is not subject to the adult minimum wage if the camp counselor is paid a stipend on a onetime or periodic basis and, if the camp counselor is a minor, the minor's parent, guardian or other custodian has consented in writing to the terms of payment before the commencement of such employment.

(Source: P.A. 99-143, eff. 7-27-15.)

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