Full Text of SB1627 103rd General Assembly
SB1627sam002 103RD GENERAL ASSEMBLY | Sen. David Koehler Filed: 3/29/2023
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| 1 | | AMENDMENT TO SENATE BILL 1627
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 1627 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 1. Short title. This Act may be referred to as the | 5 | | Illinois Farmers Who Fight Hunger Act. | 6 | | Section 5. The Illinois Estate and Generation-Skipping | 7 | | Transfer Tax Act is amended by changing Section 2 and by adding | 8 | | Section 8.1 as follows:
| 9 | | (35 ILCS 405/2) (from Ch. 120, par. 405A-2)
| 10 | | Sec. 2. Definitions.
| 11 | | "Farm property" means real property that is used primarily | 12 | | for raising or harvesting agricultural or horticultural | 13 | | commodities for commercial sale. | 14 | | "Federal estate tax" means the tax due to the United | 15 | | States with respect
to a taxable transfer under Chapter 11 of |
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| 1 | | the Internal Revenue Code.
| 2 | | "Federal generation-skipping transfer tax" means the tax | 3 | | due to the
United States with respect to a taxable transfer | 4 | | under Chapter 13 of the
Internal Revenue Code.
| 5 | | "Federal return" means the federal estate tax return with | 6 | | respect to the
federal estate tax and means the federal | 7 | | generation-skipping transfer tax
return
with respect to the | 8 | | federal generation-skipping transfer tax.
| 9 | | "Federal transfer tax" means the federal estate tax or the | 10 | | federal
generation-skipping transfer tax.
| 11 | | "Food bank" means a food bank in Illinois that received | 12 | | funding from The Emergency Food Assistance Program (TEFAP) in | 13 | | the year in which it received the qualified donation. | 14 | | "Historically underserved farmer or rancher" means an | 15 | | individual who: (i) is a beginning farmer or rancher, a | 16 | | socially disadvantaged farmer or rancher, a veteran farmer or | 17 | | rancher, or a limited resource farmer or rancher, as those | 18 | | terms are defined by the Natural Resources Conservation | 19 | | Service of the United States Department of Agriculture; and | 20 | | (ii) materially and substantially participates in the | 21 | | operation of farm property located in the State at least 50% of | 22 | | which is owned by a beginning farmer or rancher, a socially | 23 | | disadvantaged farmer or rancher, a veteran farmer or rancher, | 24 | | or some combination of those persons at the time the donation | 25 | | is made. | 26 | | "Illinois estate tax" means the tax due to this State with |
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| 1 | | respect to a
taxable transfer.
| 2 | | "Illinois generation-skipping transfer tax" means the tax | 3 | | due to this State
with respect to a taxable transfer that gives | 4 | | rise to a federal
generation-skipping transfer tax.
| 5 | | "Illinois transfer tax" means the Illinois estate tax or | 6 | | the Illinois
generation-skipping transfer tax.
| 7 | | "Internal Revenue Code" means, unless otherwise provided, | 8 | | the Internal
Revenue Code of 1986, as
amended from time to | 9 | | time.
| 10 | | "Material and substantial participation" means day-to-day | 11 | | labor and management of farm property, consistent with the | 12 | | practices of the county in which the farm property is located. | 13 | | "Non-resident trust" means a trust that is not a resident | 14 | | of this State
for purposes of the Illinois Income Tax Act, as | 15 | | amended from time to time.
| 16 | | "Person" means and includes any individual, trust, estate, | 17 | | partnership,
association, company or corporation.
| 18 | | "Qualified heir" means a qualified heir as defined in | 19 | | Section 2032A(e)(1)
of the Internal Revenue Code.
| 20 | | "Qualified donation" means a donation to a food bank or to | 21 | | a historically underserved farmer or rancher of an | 22 | | agricultural or horticultural commodity that is suitable for | 23 | | human consumption and is produced on qualified farm property, | 24 | | a cash equivalent donation to a food bank or a historically | 25 | | underserved farmer or rancher, or some combination of those | 26 | | types of donations. |
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| 1 | | "Qualified farm property" means farm property in which the | 2 | | decedent had an ownership interest at the time of the | 3 | | decedent's death and for at least 5 years before the | 4 | | decedent's death and from which either: | 5 | | (1) the decedent made qualified donations in at least | 6 | | 5 separate calendar years before the decedent's death | 7 | | totaling at least 1% of the gross revenue from crop yield | 8 | | associated with the property in the calendar year in which | 9 | | the donation was made, and the decedent's heirs pledge to | 10 | | make qualified donations in each of the 5 consecutive | 11 | | calendar years beginning with the year after the | 12 | | decedent's death totaling at least 1% of the gross revenue | 13 | | from crop yield associated with the property in the | 14 | | calendar year in which the donation is made; or | 15 | | (2) the decedent made qualified donations in at least | 16 | | one calendar year but fewer than 5 calendar years before | 17 | | the decedent's death totaling at least 1% of the gross | 18 | | revenue from crop yield associated with the property in | 19 | | the calendar year in which the donation was made, and the | 20 | | decedent's heirs pledge to make qualified donations in | 21 | | each of the 10 consecutive calendar years beginning with | 22 | | the year after the decedent's death totaling at least 1% | 23 | | of the gross revenue from crop yield associated with the | 24 | | property in the calendar year in which the donation is | 25 | | made. | 26 | | "Resident trust" means a trust that is a resident of this |
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| 1 | | State for
purposes of the Illinois Income Tax Act, as amended | 2 | | from time to time.
| 3 | | "State" means any state, territory or possession of the | 4 | | United States and
the District of Columbia.
| 5 | | "State tax credit" means:
| 6 | | (a) For persons dying on or after January 1, 2003 and
| 7 | | through December 31, 2005, an amount
equal
to the full credit | 8 | | calculable under Section 2011 or Section 2604 of the
Internal | 9 | | Revenue
Code as the credit would have been computed and | 10 | | allowed under the Internal
Revenue
Code as in effect on | 11 | | December 31, 2001, without the reduction in the State
Death | 12 | | Tax
Credit as provided in Section 2011(b)(2) or the | 13 | | termination of the State Death
Tax Credit
as provided in | 14 | | Section 2011(f) as enacted by the Economic Growth and Tax | 15 | | Relief
Reconciliation Act of 2001, but recognizing the | 16 | | increased applicable exclusion
amount
through December 31, | 17 | | 2005.
| 18 | | (b) For persons dying after December 31, 2005 and on or | 19 | | before December 31,
2009, and for persons dying after December | 20 | | 31, 2010, an amount equal to the full
credit
calculable under | 21 | | Section 2011 or 2604 of the Internal Revenue Code as the
credit | 22 | | would
have been computed and allowed under the Internal | 23 | | Revenue Code as in effect on
December 31, 2001, without the | 24 | | reduction in the State Death Tax Credit as
provided in
Section | 25 | | 2011(b)(2) or the termination of the State Death Tax Credit as | 26 | | provided
in
Section 2011(f) as enacted by the Economic Growth |
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| 1 | | and Tax Relief Reconciliation
Act of
2001, but recognizing the | 2 | | exclusion amount of only (i) $2,000,000 for persons dying | 3 | | prior to January 1, 2012, (ii) $3,500,000 for persons dying on | 4 | | or after January 1, 2012 and prior to January 1, 2013, and | 5 | | (iii) $4,000,000 for persons dying on or after January 1, | 6 | | 2013, and with reduction to the adjusted taxable estate for | 7 | | any qualified terminable interest property election as defined | 8 | | in subsection (b-1) of this Section. For persons dying on or | 9 | | after January 1, 2024, for the purposes of computing the State | 10 | | tax credit, the person's adjusted taxable estate shall not | 11 | | include the value of the person's ownership interest in | 12 | | qualified farm property up to $4,400,000.
| 13 | | (b-1) The person required to file the Illinois return may | 14 | | elect on a timely filed Illinois return a marital deduction | 15 | | for qualified terminable interest property under Section | 16 | | 2056(b)(7) of the Internal Revenue Code for purposes of the | 17 | | Illinois estate tax that is separate and independent of any | 18 | | qualified terminable interest property election for federal | 19 | | estate tax purposes. For purposes of the Illinois estate tax, | 20 | | the inclusion of property in the gross estate of a surviving | 21 | | spouse is the same as under Section 2044 of the Internal | 22 | | Revenue Code. | 23 | | In the case of any trust for which a State or federal | 24 | | qualified terminable interest property election is made, the | 25 | | trustee may not retain non-income producing assets for more | 26 | | than a reasonable amount of time without the consent of the |
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| 1 | | surviving spouse.
| 2 | | "Taxable transfer" means an event that gives rise to a | 3 | | state tax credit,
including any credit as a result of the | 4 | | imposition of an
additional tax under Section 2032A(c) of the | 5 | | Internal Revenue Code.
| 6 | | "Transferee" means a transferee within the meaning of | 7 | | Section 2603(a)(1)
and Section 6901(h) of the Internal Revenue | 8 | | Code.
| 9 | | "Transferred property" means:
| 10 | | (1) With respect to a taxable transfer occurring at | 11 | | the death of an
individual, the
deceased individual's | 12 | | gross estate as defined in Section 2031 of the
Internal | 13 | | Revenue Code.
| 14 | | (2) With respect to a taxable transfer occurring as a | 15 | | result of a
taxable termination as defined in Section | 16 | | 2612(a) of the Internal Revenue Code,
the taxable amount | 17 | | determined under Section 2622(a) of the Internal Revenue
| 18 | | Code.
| 19 | | (3) With respect to a taxable transfer occurring as a | 20 | | result of a
taxable distribution as defined in Section | 21 | | 2612(b) of the Internal Revenue Code,
the taxable amount | 22 | | determined under Section 2621(a) of the Internal Revenue
| 23 | | Code.
| 24 | | (4) With respect to an event which causes the | 25 | | imposition of an
additional estate tax under Section | 26 | | 2032A(c) of the Internal Revenue Code,
the
qualified real |
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| 1 | | property that was disposed of or which ceased to be used | 2 | | for
the qualified use, within the meaning of Section | 3 | | 2032A(c)(1) of the Internal
Revenue Code.
| 4 | | "Trust" includes a trust as defined in Section 2652(b)(1) | 5 | | of the Internal
Revenue Code.
| 6 | | (Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11; | 7 | | 97-636, eff. 6-1-12 .)
| 8 | | (35 ILCS 405/8.1 new) | 9 | | Sec. 8.1. Qualified farm property; qualified donations. If | 10 | | the decedent's heirs pledge to make qualified donations to | 11 | | food banks or to historically underserved farmers or ranchers | 12 | | so that farm property is eligible to be deducted as qualified | 13 | | farm property, then the heirs shall file annual reports with | 14 | | the Attorney General documenting those donations. If the heirs | 15 | | fail to make those donations, then the Attorney General may | 16 | | take steps to recapture the amount of the deduction that | 17 | | should have been disallowed. The Attorney General shall adopt | 18 | | rules to implement this Section and to establish the form and | 19 | | manner of the heirs' pledge under Section 2.
| 20 | | Section 99. Effective date. This Act takes effect upon | 21 | | becoming law.".
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