Full Text of HB2999 102nd General Assembly
HB2999 102ND GENERAL ASSEMBLY |
| | 102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022 HB2999 Introduced 2/19/2021, by Rep. Dave Severin SYNOPSIS AS INTRODUCED: |
| 35 ILCS 16/10 | | 35 ILCS 16/42 | |
|
Amends the Film Production Services Tax Credit Act of 2008. Provides that the credit applies on a permanent basis. Provides that the term "Illinois production spending" includes the compensation, not to exceed $1,000,000 per employee, for up to 4 contractual or salaried employees who perform services with respect to an accredited production. Provides that those employees are not required to be residents of the State. Provides that Illinois labor expenditures are limited to: (i) the first $200,000 of wages paid or incurred to each out-of-State employee of the production; and (ii) 100% of the wages paid or incurred to each employee of the production who is a resident of the State. Provides that talk shows, other than talk shows that are produced for local or regional markets, and reality competition productions may be considered accredited productions. Provides that the credit includes 5% of the Illinois labor expenditures generated by the employment of residents of the State who reside outside of the metropolitan area. Provides that the credit amount shall be increased by 5% if 50% or more of the total hours of principal filming or taping of the production are completed in the State but outside of the metropolitan area. Provides that the term "metropolitan area" means the City of Chicago and any part of the State located within 30 miles of the City of Chicago. Effective immediately.
|
| |
| | A BILL FOR |
|
| | | HB2999 | | LRB102 14916 HLH 20271 b |
|
| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Film
Production Services Tax Credit Act of | 5 | | 2008 is amended by changing Sections 10 and 42 as follows: | 6 | | (35 ILCS 16/10)
| 7 | | Sec. 10. Definitions. As used in this Act:
| 8 | | "Accredited production" means: (i) for productions | 9 | | commencing before May 1, 2006, a film, video, or television | 10 | | production that
has been certified by the Department in which | 11 | | the aggregate Illinois labor
expenditures
included in the cost | 12 | | of the production, in the period that ends 12 months after
the | 13 | | time principal filming or taping of the production began, | 14 | | exceed $100,000
for productions of 30 minutes or longer, or | 15 | | $50,000 for productions of less
than 30
minutes; and (ii) for | 16 | | productions commencing on or after May 1, 2006, a film, video, | 17 | | or television production that has been certified by the | 18 | | Department in which the Illinois production spending included | 19 | | in the cost of production in the period that ends 12 months | 20 | | after the time principal filming or taping of the production | 21 | | began exceeds $100,000 for productions of 30 minutes or longer | 22 | | or exceeds $50,000 for productions of less than 30 minutes. | 23 | | "Accredited production" does not include a production that:
|
| | | HB2999 | - 2 - | LRB102 14916 HLH 20271 b |
|
| 1 | | (1) is news, current events, or public programming, or | 2 | | a program that
includes weather or market reports;
| 3 | | (2) is a talk show produced for local or regional | 4 | | markets ;
| 5 | | (3) is a production in respect of a game, | 6 | | questionnaire, or contest , not including a reality | 7 | | competition production ;
| 8 | | (4) is a sports event or activity;
| 9 | | (5) is a gala presentation or awards show;
| 10 | | (6) is a finished production that solicits funds;
| 11 | | (7) is a production produced by a film production | 12 | | company if records, as
required
by 18
U.S.C. 2257, are to | 13 | | be maintained by that film production company with respect
| 14 | | to any
performer portrayed in that single media or | 15 | | multimedia program; or
| 16 | | (8) is a production produced primarily for industrial, | 17 | | corporate, or
institutional purposes.
| 18 | | "Accredited animated production" means an accredited | 19 | | production in which movement and characters' performances are | 20 | | created using a frame-by-frame technique and a significant | 21 | | number of major characters are animated. Motion capture by | 22 | | itself is not an animation technique. | 23 | | "Accredited production certificate" means a certificate | 24 | | issued by the
Department certifying that the production is an | 25 | | accredited production that
meets the guidelines of this Act.
| 26 | | "Applicant" means a taxpayer that is a film production |
| | | HB2999 | - 3 - | LRB102 14916 HLH 20271 b |
|
| 1 | | company that is
operating or has operated an accredited | 2 | | production located within the State of
Illinois and that
(i) | 3 | | owns the copyright in the accredited production throughout the
| 4 | | Illinois production period or (ii)
has contracted directly | 5 | | with the owner of the copyright in the
accredited production
| 6 | | or a person acting on behalf of the owner
to provide services | 7 | | for the production, where the owner
of the copyright is not an | 8 | | eligible production corporation.
| 9 | | "Credit" means:
| 10 | | (1) for an accredited production approved by the | 11 | | Department on or before January 1, 2005 and commencing | 12 | | before May 1, 2006, the amount equal to 25% of the Illinois | 13 | | labor
expenditure approved by the Department.
The | 14 | | applicant is deemed to have paid, on its balance due day | 15 | | for the year, an
amount equal to 25% of its qualified | 16 | | Illinois labor expenditure for the tax
year. For Illinois | 17 | | labor expenditures generated by the employment of | 18 | | residents of geographic areas of high poverty or high | 19 | | unemployment, as determined by the Department, in an | 20 | | accredited production commencing before May 1, 2006 and
| 21 | | approved by the Department after January 1, 2005, the | 22 | | applicant shall receive an enhanced credit of 10% in | 23 | | addition to the 25% credit; and | 24 | | (2) for an accredited production commencing on or | 25 | | after May 1, 2006, the amount equal to: | 26 | | (i) 20% of the Illinois production spending for |
| | | HB2999 | - 4 - | LRB102 14916 HLH 20271 b |
|
| 1 | | the taxable year; plus | 2 | | (ii) 15% of the Illinois labor expenditures | 3 | | generated by the employment of residents of geographic | 4 | | areas of high poverty or high unemployment, as | 5 | | determined by the Department; and
| 6 | | (3) for an accredited production commencing on or | 7 | | after January 1, 2009 and prior to July 1, 2021 , the amount | 8 | | equal to: | 9 | | (i) 30% of the Illinois production spending for | 10 | | the taxable year; plus | 11 | | (ii) 15% of the Illinois labor expenditures | 12 | | generated by the employment of residents of geographic | 13 | | areas of high poverty or high unemployment, as | 14 | | determined by the Department ; and . | 15 | | (4) for an accredited production commencing on or | 16 | | after July 1, 2021, the amount equal to: | 17 | | (i) 30% of the Illinois production spending for | 18 | | the taxable year; plus | 19 | | (ii) 15% of the Illinois labor expenditures | 20 | | generated by the employment of residents of geographic | 21 | | areas of high poverty or high unemployment, as | 22 | | determined by the Department; plus | 23 | | (iii) 5% of the Illinois labor expenditures | 24 | | generated by the employment of residents of the State | 25 | | who reside outside of the metropolitan area; if the | 26 | | person is a resident of a geographic area of high |
| | | HB2999 | - 5 - | LRB102 14916 HLH 20271 b |
|
| 1 | | poverty or high unemployment and also resides outside | 2 | | of the metropolitan area, then the credit includes | 3 | | both paragraphs (ii) and (iii); plus | 4 | | (iv) if 50% or more of the total hours of principal | 5 | | filming or taping of the production are completed in | 6 | | the State but outside of the metropolitan area, as | 7 | | determined by the Department, then the total amount of | 8 | | the credit under paragraphs (i), (ii), and (iii), as | 9 | | applicable, shall be increased by 5%. | 10 | | "Department" means the Department of Commerce and Economic | 11 | | Opportunity.
| 12 | | "Director" means the Director of Commerce and Economic | 13 | | Opportunity.
| 14 | | "Illinois labor expenditure" means
salary or wages paid to | 15 | | employees of the
applicant for services on the accredited
| 16 | | production . ;
| 17 | | To qualify as an Illinois labor expenditure, the | 18 | | expenditure must be:
| 19 | | (1) Reasonable in the circumstances.
| 20 | | (2) Included in the federal income tax basis of the | 21 | | property.
| 22 | | (3) Incurred by the applicant for services on or after | 23 | | January 1, 2004.
| 24 | | (4) Incurred for the production stages of the | 25 | | accredited production, from
the final
script stage to the | 26 | | end of the post-production stage.
|
| | | HB2999 | - 6 - | LRB102 14916 HLH 20271 b |
|
| 1 | | (5) Limited to : (A) the first $25,000 of wages paid or | 2 | | incurred to each
employee of a production commencing | 3 | | before May 1, 2006 ; (B) and the first $100,000 of wages | 4 | | paid or incurred to each
employee of
a production | 5 | | commencing on or after May 1, 2006 and prior to July 1, | 6 | | 2021; or (C) for a production commencing on or after July | 7 | | 1, 2021, (i) the first $200,000 of wages paid or incurred | 8 | | to each out-of-State employee of the production, whether | 9 | | paid or incurred by the production company or by a loan out | 10 | | corporation, subject to withholding payments provided for | 11 | | in Article 7 of the Illinois Income Tax Act, and (ii) 100% | 12 | | of the wages paid or incurred to each employee of the | 13 | | production who is a resident of the State, whether paid or | 14 | | incurred by the production company or by a loan out | 15 | | corporation .
| 16 | | (6) For a production commencing before May 1, 2006, | 17 | | exclusive of the salary or wages paid to or incurred for | 18 | | the 2 highest
paid
employees of the production.
| 19 | | (7) Directly attributable to the accredited | 20 | | production.
| 21 | | (8) (Blank).
| 22 | | (9) Paid to persons resident in Illinois at the time | 23 | | the payments were
made.
| 24 | | (10) Paid for services rendered in Illinois.
| 25 | | "Illinois production spending" means the expenses incurred | 26 | | by the applicant for an accredited production, including, |
| | | HB2999 | - 7 - | LRB102 14916 HLH 20271 b |
|
| 1 | | without limitation, all of the following: | 2 | | (1) expenses to purchase, from vendors within | 3 | | Illinois, tangible personal property that is used in the | 4 | | accredited production; | 5 | | (2) expenses to acquire services, from vendors in | 6 | | Illinois, for film production, editing, or processing; and | 7 | | (3) the compensation, not to exceed $100,000 for any | 8 | | one employee, other than an employee specified in item | 9 | | (4), for contractual or salaried employees who are | 10 | | Illinois residents performing services with respect to the | 11 | | accredited production ; and . | 12 | | (4) the compensation, not to exceed $1,000,000 per | 13 | | employee, for up to 4 contractual or salaried employees | 14 | | who perform services with respect to the accredited | 15 | | production; the employees referenced under this item (4) | 16 | | are not required to be residents of the State. | 17 | | "Metropolitan area" means the City of Chicago and any part | 18 | | of the State located within 30 miles of the City of Chicago. | 19 | | "Qualified production facility" means stage facilities in | 20 | | the State in which television shows and films are or are | 21 | | intended to be regularly produced and that contain at least | 22 | | one sound stage of at least 15,000 square feet.
| 23 | | Rulemaking authority to implement Public Act 95-1006 this | 24 | | amendatory Act of the 95th General Assembly , if any, is | 25 | | conditioned on the rules being adopted in accordance with all | 26 | | provisions of the Illinois Administrative Procedure Act and |
| | | HB2999 | - 8 - | LRB102 14916 HLH 20271 b |
|
| 1 | | all rules and procedures of the Joint Committee on | 2 | | Administrative Rules; any purported rule not so adopted, for | 3 | | whatever reason, is unauthorized. | 4 | | (Source: P.A. 97-796, eff. 7-13-12; revised 7-18-19.) | 5 | | (35 ILCS 16/42) | 6 | | Sec. 42. Sunset of credits. This Act is exempt from the | 7 | | provisions of Section 250 of the Illinois Income Tax Act. The | 8 | | application of credits awarded pursuant to this Act shall be | 9 | | limited by a reasonable and appropriate sunset date. A | 10 | | taxpayer shall not be entitled to take a credit awarded | 11 | | pursuant to this Act for tax years beginning on or after | 12 | | January 1, 2027.
| 13 | | (Source: P.A. 101-178, eff. 8-1-19.)
| 14 | | Section 99. Effective date. This Act takes effect upon | 15 | | becoming law.
|
|