State of Illinois
2023 and 2024


Introduced 2/16/2023, by Rep. Norine K. Hammond


New Act
35 ILCS 5/234 new

    Creates the Endow Illinois Tax Credit Act and makes conforming changes in the Illinois Income Tax Act. Requires the Department of Revenue to authorize an income tax credit to taxpayers who provide an endowment gift to a permanent endowment fund. Sets forth procedures and criteria for authorizing the credits. Provides that the aggregate amount of all credits that the Department of Revenue may authorize may not exceed $10,000,000 in 2023, $25,000,000 in 2024, or $50,000,000 in 2025 and each calendar year thereafter. Provides conditions for eligibility. Requires the Department of Revenue to make an annual report concerning the credits. Provides that the credit may be carried forward for 5 years. Exempts the credit from the Act's sunset provisions. Effective immediately.

LRB103 25745 HLH 52094 b





HB2990LRB103 25745 HLH 52094 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 Endow
5Illinois Tax Credit Act.
6    Section 5. Definitions. For the purposes of this Act:
7    "Department" means the Department of Revenue.
8    "Endowment gift" means an irrevocable contribution to a
9permanent endowment fund held by a qualified community
11    "Permanent endowment fund" means a fund that (i) is held
12by a qualified community foundation to provide benefit to
13charitable causes in the State, (ii) is intended to exist in
14perpetuity, and (iii) has an annual spending rate based on the
15foundation spending policy, but not to exceed 7%.
16    "Qualified community foundation" means a community
17foundation or similar publicly-supported organization
18described in Section 170 (b)(1)(A)(vi) of the Internal Revenue
19Code of 1986 that is organized or operating in this State and
20that substantially complies with the national standards for
21U.S. community foundations that are established by the
22National Council on Foundations, as determined by the



HB2990- 2 -LRB103 25745 HLH 52094 b

1    Section 10. Tax credit awards.
2    (a) The Department shall authorize an income tax credit to
3taxpayers who provide an endowment gift to a permanent
4endowment fund. The amount of the credit that may be
5authorized to a taxpayer by the Department under this Act is an
6amount equal to 50% of the endowment gift. A taxpayer that is a
7business entity is not eligible to receive a credit under this
8Act for the taxable year if the taxpayer's gross business
9receipts exceed $10,000,000 for taxable years ending in 2022,
10$25,000,000 for taxable years ending in 2024, or $50,000,000
11for taxable years ending in 2025 or thereafter.
12    (b) The aggregate amount of all credits that the
13Department may authorize under this Act may not exceed
14$10,000,000 in 2023, $25,000,000 in 2024, or $50,000,000 in
152025 and each calendar year thereafter. The aggregate amount
16of all credits that the Department may authorize to any single
17taxpayer in a calendar year may not exceed 5% of the aggregate
18amount of all credits authorized by the Department in that
19calendar year. The aggregate amount of all credits that the
20Department may authorize in any calendar year based on
21endowment gifts to any specific community foundation may not
22exceed 25% of aggregate credits authorized for that year.
23    (c) If the Department receives applications for tax credit
24in excess of the amount available, then the applications must
25be prioritized by the date that the Department received them.



HB2990- 3 -LRB103 25745 HLH 52094 b

1If the number of applications exceeds the amount of annual tax
2credits available, then the Department must establish a wait
3list for the next year's allocation of tax credits, and
4applications must first be funded in the order listed on that
5wait list.
6    Section 15. Applications for tax credits.
7    (a) The Department shall develop and make available a
8standardized application pertaining to the allocation of tax
9credits under this Act.
10    (b) Of the annual amount available for tax credits, 10%
11must be reserved for those endowment gifts of $30,000 or less.
12If the entire 10% that is reserved for permanent endowment
13gifts totalling $30,000 or less is not allocated, then the
14remaining amount is available in the following years for
15endowment gifts of $30,000 or less.
16    (c) The Department must accept applications and authorize
17credits in an ongoing basis. The Department must make public,
18by June 1 and by December 1 of each year, the total number of
19requests for tax credits and the total amount of requested tax
20credits that have been submitted and awarded.
21    Section 20. Annual report. By January 31 of each year, the
22Department must submit an annual report to the Governor and
23the General Assembly concerning the activities conduced under
24this Act during the previous calendar year. The report must



HB2990- 4 -LRB103 25745 HLH 52094 b

1include a detailed listing of tax credits authorized under
2this Act by the Department.
3    Section 90. The Illinois Income Tax Act is amended by
4adding Section 234 as follows:
5    (35 ILCS 5/234 new)
6    Sec. 234. The Endow Illinois tax credit.
7    (a) For taxable years ending on or after December 31,
82023, each taxpayer for whom a tax credit has been authorized
9by the Department of Revenue under the Endow Illinois Tax
10Credit Act, is entitled to a credit against the tax imposed
11under subsections (a) and (b) of Section 201 in an amount equal
12to the amount authorized under that Act.
13    (b) For partners, shareholders of Subchapter S
14corporations, and members of limited liability companies, if
15the liability company is treated as a partnership for purposes
16of federal and State income taxation, there is allowed a
17credit under this Section to be determined in accordance with
18the determination of income and distributive share of income
19under Sections 702 and 704 and Subchapter S of the Internal
20Revenue Code.
21    (c) The credit may not be carried back and may not reduce
22the taxpayer's liability to less than zero. If the amount of
23the credit exceeds the tax liability for the year, the excess
24may be carried forward and applied to the tax liability of the



HB2990- 5 -LRB103 25745 HLH 52094 b

15 taxable years following the excess credit year. The tax
2credit shall be applied to the earliest year for which there is
3a tax liability. If there are credits for more than one year
4that are available to offset a liability, the earlier credit
5shall be applied first.
6    (d) This Section is exempt from the provisions of Section
8    Section 99. Effective date. This Act takes effect upon
9becoming law.