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Public Act 094-0247 |
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AN ACT concerning revenue.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Income Tax Act is amended by | ||||
changing Sections 304 and 601 as follows:
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(35 ILCS 5/304) (from Ch. 120, par. 3-304)
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Sec. 304. Business income of persons other than residents.
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(a) In general. The business income of a person other than | ||||
a
resident shall be allocated to this State if such person's | ||||
business
income is derived solely from this State. If a person | ||||
other than a
resident derives business income from this State | ||||
and one or more other
states, then, for tax years ending on or | ||||
before December 30, 1998, and
except as otherwise provided by | ||||
this Section, such
person's business income shall be | ||||
apportioned to this State by
multiplying the income by a | ||||
fraction, the numerator of which is the sum
of the property | ||||
factor (if any), the payroll factor (if any) and 200% of the
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sales factor (if any), and the denominator of which is 4 | ||||
reduced by the
number of factors other than the sales factor | ||||
which have a denominator
of zero and by an additional 2 if the | ||||
sales factor has a denominator of zero.
For tax years ending on | ||||
or after December 31, 1998, and except as otherwise
provided by | ||||
this Section, persons other than
residents who derive business | ||||
income from this State and one or more other
states shall | ||||
compute their apportionment factor by weighting their | ||||
property,
payroll, and sales factors as provided in
subsection | ||||
(h) of this Section.
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(1) Property factor.
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(A) The property factor is a fraction, the numerator of | ||||
which is the
average value of the person's real and | ||||
tangible personal property owned
or rented and used in the | ||||
trade or business in this State during the
taxable year and |
the denominator of which is the average value of all
the | ||
person's real and tangible personal property owned or | ||
rented and
used in the trade or business during the taxable | ||
year.
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(B) Property owned by the person is valued at its | ||
original cost.
Property rented by the person is valued at 8 | ||
times the net annual rental
rate. Net annual rental rate is | ||
the annual rental rate paid by the
person less any annual | ||
rental rate received by the person from
sub-rentals.
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(C) The average value of property shall be determined | ||
by averaging
the values at the beginning and ending of the | ||
taxable year but the
Director may require the averaging of | ||
monthly values during the taxable
year if reasonably | ||
required to reflect properly the average value of the
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person's property.
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(2) Payroll factor.
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(A) The payroll factor is a fraction, the numerator of | ||
which is the
total amount paid in this State during the | ||
taxable year by the person
for compensation, and the | ||
denominator of which is the total compensation
paid | ||
everywhere during the taxable year.
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(B) Compensation is paid in this State if:
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(i) The individual's service is performed entirely | ||
within this
State;
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(ii) The individual's service is performed both | ||
within and without
this State, but the service | ||
performed without this State is incidental
to the | ||
individual's service performed within this State; or
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(iii) Some of the service is performed within this | ||
State and either
the base of operations, or if there is | ||
no base of operations, the place
from which the service | ||
is directed or controlled is within this State,
or the | ||
base of operations or the place from which the service | ||
is
directed or controlled is not in any state in which | ||
some part of the
service is performed, but the | ||
individual's residence is in this State.
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(iv) Compensation paid to nonresident professional | ||
athletes. | ||
(a) General. The Illinois source income of a | ||
nonresident individual who is a member of a | ||
professional athletic team includes the portion of the | ||
individual's total compensation for services performed | ||
as a member of a professional athletic team during the | ||
taxable year which the number of duty days spent within | ||
this State performing services for the team in any | ||
manner during the taxable year bears to the total | ||
number of duty days spent both within and without this | ||
State during the taxable year. | ||
(b) Travel days. Travel days that do not involve | ||
either a game, practice, team meeting, or other similar | ||
team event are not considered duty days spent in this | ||
State. However, such travel days are considered in the | ||
total duty days spent both within and without this | ||
State. | ||
(c) Definitions. For purposes of this subpart | ||
(iv): | ||
(1) The term "professional athletic team" | ||
includes, but is not limited to, any professional | ||
baseball, basketball, football, soccer, or hockey | ||
team. | ||
(2) The term "member of a professional | ||
athletic team" includes those employees who are | ||
active players, players on the disabled list, and | ||
any other persons required to travel and who travel | ||
with and perform services on behalf of a | ||
professional athletic team on a regular basis. | ||
This includes, but is not limited to, coaches, | ||
managers, and trainers. | ||
(3) Except as provided in items (C) and (D) of | ||
this subpart (3), the term "duty days" means all | ||
days during the taxable year from the beginning of | ||
the professional athletic team's official |
pre-season training period through the last game | ||
in which the team competes or is scheduled to | ||
compete. Duty days shall be counted for the year in | ||
which they occur, including where a team's | ||
official pre-season training period through the | ||
last game in which the team competes or is | ||
scheduled to compete, occurs during more than one | ||
tax year. | ||
(A) Duty days shall also include days on | ||
which a member of a professional athletic team | ||
performs service for a team on a date that does | ||
not fall within the foregoing period (e.g., | ||
participation in instructional leagues, the | ||
"All Star Game", or promotional "caravans"). | ||
Performing a service for a professional | ||
athletic team includes conducting training and | ||
rehabilitation activities, when such | ||
activities are conducted at team facilities. | ||
(B) Also included in duty days are game | ||
days, practice days, days spent at team | ||
meetings, promotional caravans, preseason | ||
training camps, and days served with the team | ||
through all post-season games in which the team | ||
competes or is scheduled to compete. | ||
(C) Duty days for any person who joins a | ||
team during the period from the beginning of | ||
the professional athletic team's official | ||
pre-season training period through the last | ||
game in which the team competes, or is | ||
scheduled to compete, shall begin on the day | ||
that person joins the team. Conversely, duty | ||
days for any person who leaves a team during | ||
this period shall end on the day that person | ||
leaves the team. Where a person switches teams | ||
during a taxable year, a separate duty-day | ||
calculation shall be made for the period the |
person was with each team. | ||
(D) Days for which a member of a | ||
professional athletic team is not compensated | ||
and is not performing services for the team in | ||
any manner, including days when such member of | ||
a professional athletic team has been | ||
suspended without pay and prohibited from | ||
performing any services for the team, shall not | ||
be treated as duty days. | ||
(E) Days for which a member of a | ||
professional athletic team is on the disabled | ||
list and does not conduct rehabilitation | ||
activities at facilities of the team, and is | ||
not otherwise performing services for the team | ||
in Illinois, shall not be considered duty days | ||
spent in this State. All days on the disabled | ||
list, however, are considered to be included in | ||
total duty days spent both within and without | ||
this State. | ||
(4) The term "total compensation for services | ||
performed as a member of a professional athletic | ||
team" means the total compensation received during | ||
the taxable year for services performed: | ||
(A) from the beginning of the official | ||
pre-season training period through the last | ||
game in which the team competes or is scheduled | ||
to compete during that taxable year; and | ||
(B) during the taxable year on a date which | ||
does not fall within the foregoing period | ||
(e.g., participation in instructional leagues, | ||
the "All Star Game", or promotional caravans). | ||
This compensation shall include, but is not | ||
limited to, salaries, wages, bonuses as described | ||
in this subpart, and any other type of compensation | ||
paid during the taxable year to a member of a | ||
professional athletic team for services performed |
in that year. This compensation does not include | ||
strike benefits, severance pay, termination pay, | ||
contract or option year buy-out payments, | ||
expansion or relocation payments, or any other | ||
payments not related to services performed for the | ||
team. | ||
For purposes of this subparagraph, "bonuses" | ||
included in "total compensation for services | ||
performed as a member of a professional athletic | ||
team" subject to the allocation described in | ||
Section 302(c)(1) are: bonuses earned as a result | ||
of play (i.e., performance bonuses) during the | ||
season, including bonuses paid for championship, | ||
playoff or "bowl" games played by a team, or for | ||
selection to all-star league or other honorary | ||
positions; and bonuses paid for signing a | ||
contract, unless the payment of the signing bonus | ||
is not conditional upon the signee playing any | ||
games for the team or performing any subsequent | ||
services for the team or even making the team, the | ||
signing bonus is payable separately from the | ||
salary and any other compensation, and the signing | ||
bonus is nonrefundable.
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Beginning with taxable years ending on or after | ||
December 31, 1992, for
residents of states that impose a | ||
comparable tax liability on residents of this State, for
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purposes of item (i) of this paragraph (B), in the case of | ||
persons who
perform personal services under personal | ||
service contracts for sports
performances, services by | ||
that person at a sporting event taking place in
Illinois | ||
shall be deemed to be a performance entirely within this | ||
State.
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(3) Sales factor.
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(A) The sales factor is a fraction, the numerator of | ||
which is the
total sales of the person in this State during | ||
the taxable year, and the
denominator of which is the total |
sales of the person everywhere during
the taxable year.
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(B) Sales of tangible personal property are in this | ||
State if:
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(i) The property is delivered or shipped to a | ||
purchaser, other than
the United States government, | ||
within this State regardless of the f. o.
b. point or | ||
other conditions of the sale; or
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(ii) The property is shipped from an office, store, | ||
warehouse,
factory or other place of storage in this | ||
State and either the purchaser
is the United States | ||
government or the person is not taxable in the
state of | ||
the purchaser; provided, however, that premises owned | ||
or leased
by a person who has independently contracted | ||
with the seller for the printing
of newspapers, | ||
periodicals or books shall not be deemed to be an | ||
office,
store, warehouse, factory or other place of | ||
storage for purposes of this
Section. Sales of tangible | ||
personal property are not in this State if the
seller | ||
and purchaser would be members of the same unitary | ||
business group
but for the fact that either the seller | ||
or purchaser is a person with 80%
or more of total | ||
business activity outside of the United States and the
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property is purchased for resale.
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(B-1) Patents, copyrights, trademarks, and similar | ||
items of intangible
personal property.
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(i) Gross receipts from the licensing, sale, or | ||
other disposition of a
patent, copyright, trademark, | ||
or similar item of intangible personal property
are in | ||
this State to the extent the item is utilized in this | ||
State during the
year the gross receipts are included | ||
in gross income.
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(ii) Place of utilization.
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(I) A patent is utilized in a state to the | ||
extent that it is employed
in production, | ||
fabrication, manufacturing, or other processing in | ||
the state or
to the extent that a patented product |
is produced in the state. If a patent is
utilized | ||
in
more than one state, the extent to which it is | ||
utilized in any one state shall
be a fraction equal | ||
to the gross receipts of the licensee or purchaser | ||
from
sales or leases of items produced, | ||
fabricated, manufactured, or processed
within that | ||
state using the patent and of patented items | ||
produced within that
state, divided by the total of | ||
such gross receipts for all states in which the
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patent is utilized.
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(II) A copyright is utilized in a state to the | ||
extent that printing or
other publication | ||
originates in the state. If a copyright is utilized | ||
in more
than one state, the extent to which it is | ||
utilized in any one state shall be a
fraction equal | ||
to the gross receipts from sales or licenses of | ||
materials
printed or published in that state | ||
divided by the total of such gross receipts
for all | ||
states in which the copyright is utilized.
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(III) Trademarks and other items of intangible | ||
personal property
governed by this paragraph (B-1) | ||
are utilized in the state in which the
commercial | ||
domicile of the licensee or purchaser is located.
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(iii) If the state of utilization of an item of | ||
property governed by
this paragraph (B-1) cannot be | ||
determined from the taxpayer's books and
records or | ||
from the books and records of any person related to the | ||
taxpayer
within the meaning of Section 267(b) of the | ||
Internal Revenue Code, 26 U.S.C.
267, the gross
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receipts attributable to that item shall be excluded | ||
from both the numerator
and the denominator of the | ||
sales factor.
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(B-2) Gross receipts from the license, sale, or other | ||
disposition of
patents, copyrights, trademarks, and | ||
similar items of intangible personal
property may be | ||
included in the numerator or denominator of the sales |
factor
only if gross receipts from licenses, sales, or | ||
other disposition of such items
comprise more than 50% of | ||
the taxpayer's total gross receipts included in gross
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income during the tax year and during each of the 2 | ||
immediately preceding tax
years; provided that, when a | ||
taxpayer is a member of a unitary business group,
such | ||
determination shall be made on the basis of the gross | ||
receipts of the
entire unitary business group.
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(C) Sales, other than sales governed by paragraphs (B) | ||
and (B-1), are in
this State if:
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(i) The income-producing activity is performed in | ||
this State; or
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(ii) The income-producing activity is performed | ||
both within and
without this State and a greater | ||
proportion of the income-producing
activity is | ||
performed within this State than without this State, | ||
based
on performance costs.
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(D) For taxable years ending on or after December 31, | ||
1995, the following
items of income shall not be included | ||
in the numerator or denominator of the
sales factor: | ||
dividends; amounts included under Section 78 of the | ||
Internal
Revenue Code; and Subpart F income as defined in | ||
Section 952 of the Internal
Revenue Code.
No inference | ||
shall be drawn from the enactment of this paragraph (D) in
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construing this Section for taxable years ending before | ||
December 31, 1995.
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(E) Paragraphs (B-1) and (B-2) shall apply to tax years | ||
ending on or
after December 31, 1999, provided that a | ||
taxpayer may elect to apply the
provisions of these | ||
paragraphs to prior tax years. Such election shall be made
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in the form and manner prescribed by the Department, shall | ||
be irrevocable, and
shall apply to all tax years; provided | ||
that, if a taxpayer's Illinois income
tax liability for any | ||
tax year, as assessed under Section 903 prior to January
1, | ||
1999, was computed in a manner contrary to the provisions | ||
of paragraphs
(B-1) or (B-2), no refund shall be payable to |
the taxpayer for that tax year to
the extent such refund is | ||
the result of applying the provisions of paragraph
(B-1) or | ||
(B-2) retroactively. In the case of a unitary business | ||
group, such
election shall apply to all members of such | ||
group for every tax year such group
is in existence, but | ||
shall not apply to any taxpayer for any period during
which | ||
that taxpayer is not a member of such group.
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(b) Insurance companies.
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(1) In general. Except as otherwise
provided by | ||
paragraph (2), business income of an insurance company for | ||
a
taxable year shall be apportioned to this State by | ||
multiplying such
income by a fraction, the numerator of | ||
which is the direct premiums
written for insurance upon | ||
property or risk in this State, and the
denominator of | ||
which is the direct premiums written for insurance upon
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property or risk everywhere. For purposes of this | ||
subsection, the term
"direct premiums written" means the | ||
total amount of direct premiums
written, assessments and | ||
annuity considerations as reported for the
taxable year on | ||
the annual statement filed by the company with the
Illinois | ||
Director of Insurance in the form approved by the National
| ||
Convention of Insurance Commissioners or such other form as | ||
may be
prescribed in lieu thereof.
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(2) Reinsurance. If the principal source of premiums | ||
written by an
insurance company consists of premiums for | ||
reinsurance accepted by it,
the business income of such | ||
company shall be apportioned to this State
by multiplying | ||
such income by a fraction, the numerator of which is the
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sum of (i) direct premiums written for insurance upon | ||
property or risk
in this State, plus (ii) premiums written | ||
for reinsurance accepted in
respect of property or risk in | ||
this State, and the denominator of which
is the sum of | ||
(iii) direct premiums written for insurance upon property
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or risk everywhere, plus (iv) premiums written for | ||
reinsurance accepted
in respect of property or risk | ||
everywhere. For purposes of this
paragraph, premiums |
written for reinsurance accepted in respect of
property or | ||
risk in this State, whether or not otherwise determinable,
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may, at the election of the company, be determined on the | ||
basis of the
proportion which premiums written for | ||
reinsurance accepted from
companies commercially domiciled | ||
in Illinois bears to premiums written
for reinsurance | ||
accepted from all sources, or, alternatively, in the
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proportion which the sum of the direct premiums written for | ||
insurance
upon property or risk in this State by each | ||
ceding company from which
reinsurance is accepted bears to | ||
the sum of the total direct premiums
written by each such | ||
ceding company for the taxable year.
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(c) Financial organizations.
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(1) In general. Business income of a financial
| ||
organization shall be apportioned to this State by | ||
multiplying such
income by a fraction, the numerator of | ||
which is its business income from
sources within this | ||
State, and the denominator of which is its business
income | ||
from all sources. For the purposes of this subsection, the
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business income of a financial organization from sources | ||
within this
State is the sum of the amounts referred to in | ||
subparagraphs (A) through
(E) following, but excluding the | ||
adjusted income of an international banking
facility as | ||
determined in paragraph (2):
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(A) Fees, commissions or other compensation for | ||
financial services
rendered within this State;
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(B) Gross profits from trading in stocks, bonds or | ||
other securities
managed within this State;
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(C) Dividends, and interest from Illinois | ||
customers, which are received
within this State;
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(D) Interest charged to customers at places of | ||
business maintained
within this State for carrying | ||
debit balances of margin accounts,
without deduction | ||
of any costs incurred in carrying such accounts; and
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(E) Any other gross income resulting from the | ||
operation as a
financial organization within this |
State. In computing the amounts
referred to in | ||
paragraphs (A) through (E) of this subsection, any | ||
amount
received by a member of an affiliated group | ||
(determined under Section
1504(a) of the Internal | ||
Revenue Code but without reference to whether
any such | ||
corporation is an "includible corporation" under | ||
Section
1504(b) of the Internal Revenue Code) from | ||
another member of such group
shall be included only to | ||
the extent such amount exceeds expenses of the
| ||
recipient directly related thereto.
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(2) International Banking Facility.
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(A) Adjusted Income. The adjusted income of an | ||
international banking
facility is its income reduced | ||
by the amount of the floor amount.
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(B) Floor Amount. The floor amount shall be the | ||
amount, if any,
determined
by multiplying the income of | ||
the international banking facility by a fraction,
not | ||
greater than one, which is determined as follows:
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(i) The numerator shall be:
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The average aggregate, determined on a | ||
quarterly basis, of the
financial
organization's | ||
loans to banks in foreign countries, to foreign | ||
domiciled
borrowers (except where secured | ||
primarily by real estate) and to foreign
| ||
governments and other foreign official | ||
institutions, as reported for its
branches, | ||
agencies and offices within the state on its | ||
"Consolidated Report
of Condition", Schedule A, | ||
Lines 2.c., 5.b., and 7.a., which was filed with
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the Federal Deposit Insurance Corporation and | ||
other regulatory authorities,
for the year 1980, | ||
minus
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The average aggregate, determined on a | ||
quarterly basis, of such loans
(other
than loans of | ||
an international banking facility), as reported by | ||
the financial
institution for its branches, |
agencies and offices within the state, on
the | ||
corresponding Schedule and lines of the | ||
Consolidated Report of Condition
for the current | ||
taxable year, provided, however, that in no case | ||
shall the
amount determined in this clause (the | ||
subtrahend) exceed the amount determined
in the | ||
preceding clause (the minuend); and
| ||
(ii) the denominator shall be the average | ||
aggregate, determined on a
quarterly basis, of the | ||
international banking facility's loans to banks in
| ||
foreign countries, to foreign domiciled borrowers | ||
(except where secured
primarily by real estate) | ||
and to foreign governments and other foreign
| ||
official institutions, which were recorded in its | ||
financial accounts for
the current taxable year.
| ||
(C) Change to Consolidated Report of Condition and | ||
in Qualification.
In the event the Consolidated Report | ||
of Condition which is filed with the
Federal Deposit | ||
Insurance Corporation and other regulatory authorities | ||
is
altered so that the information required for | ||
determining the floor amount
is not found on Schedule | ||
A, lines 2.c., 5.b. and 7.a., the financial
institution | ||
shall notify the Department and the Department may, by
| ||
regulations or otherwise, prescribe or authorize the | ||
use of an alternative
source for such information. The | ||
financial institution shall also notify
the Department | ||
should its international banking facility fail to | ||
qualify as
such, in whole or in part, or should there | ||
be any amendment or change to
the Consolidated Report | ||
of Condition, as originally filed, to the extent
such | ||
amendment or change alters the information used in | ||
determining the floor
amount.
| ||
(d) Transportation services. Business income derived from | ||
furnishing
transportation services shall be apportioned to | ||
this State in accordance
with paragraphs (1) and (2):
| ||
(1) Such business income (other than that derived from
|
transportation by pipeline) shall be apportioned to this | ||
State by
multiplying such income by a fraction, the | ||
numerator of which is the
revenue miles of the person in | ||
this State, and the denominator of which
is the revenue | ||
miles of the person everywhere. For purposes of this
| ||
paragraph, a revenue mile is the transportation of 1 | ||
passenger or 1 net
ton of freight the distance of 1 mile | ||
for a consideration. Where a
person is engaged in the | ||
transportation of both passengers and freight,
the | ||
fraction above referred to shall be determined by means of | ||
an
average of the passenger revenue mile fraction and the | ||
freight revenue
mile fraction, weighted to reflect the | ||
person's
| ||
(A) relative railway operating income from total | ||
passenger and total
freight service, as reported to the | ||
Interstate Commerce Commission, in
the case of | ||
transportation by railroad, and
| ||
(B) relative gross receipts from passenger and | ||
freight
transportation, in case of transportation | ||
other than by railroad.
| ||
(2) Such business income derived from transportation | ||
by pipeline
shall be apportioned to this State by | ||
multiplying such income by a
fraction, the numerator of | ||
which is the revenue miles of the person in
this State, and | ||
the denominator of which is the revenue miles of the
person | ||
everywhere. For the purposes of this paragraph, a revenue | ||
mile is
the transportation by pipeline of 1 barrel of oil, | ||
1,000 cubic feet of
gas, or of any specified quantity of | ||
any other substance, the distance
of 1 mile for a | ||
consideration.
| ||
(e) Combined apportionment. Where 2 or more persons are | ||
engaged in
a unitary business as described in subsection | ||
(a)(27) of
Section 1501,
a part of which is conducted in this | ||
State by one or more members of the
group, the business income | ||
attributable to this State by any such member
or members shall | ||
be apportioned by means of the combined apportionment method.
|
(f) Alternative allocation. If the allocation and | ||
apportionment
provisions of subsections (a) through (e) and of | ||
subsection (h) do not
fairly represent the
extent of a person's | ||
business activity in this State, the person may
petition for, | ||
or the Director may require, in respect of all or any part
of | ||
the person's business activity, if reasonable:
| ||
(1) Separate accounting;
| ||
(2) The exclusion of any one or more factors;
| ||
(3) The inclusion of one or more additional factors | ||
which will
fairly represent the person's business | ||
activities in this State; or
| ||
(4) The employment of any other method to effectuate an | ||
equitable
allocation and apportionment of the person's | ||
business income.
| ||
(g) Cross reference. For allocation of business income by | ||
residents,
see Section 301(a).
| ||
(h) For tax years ending on or after December 31, 1998, the | ||
apportionment
factor of persons who apportion their business | ||
income to this State under
subsection (a) shall be equal to:
| ||
(1) for tax years ending on or after December 31, 1998 | ||
and before December
31, 1999, 16 2/3% of the property | ||
factor plus 16 2/3% of the payroll factor
plus
66 2/3% of | ||
the sales factor;
| ||
(2) for tax years ending on or after December 31, 1999 | ||
and before December
31,
2000, 8 1/3% of the property factor | ||
plus 8 1/3% of the payroll factor plus 83
1/3%
of the sales | ||
factor;
| ||
(3) for tax years ending on or after December 31, 2000, | ||
the sales factor.
| ||
If, in any tax year ending on or after December 31, 1998 and | ||
before December
31, 2000, the denominator of the payroll, | ||
property, or sales factor is zero,
the apportionment
factor | ||
computed in paragraph (1) or (2) of this subsection for that | ||
year shall
be divided by an amount equal to 100% minus the | ||
percentage weight given to each
factor whose denominator is | ||
equal to zero.
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(Source: P.A. 90-562, eff. 12-16-97; 90-613, eff. 7-9-98; | ||
91-541, eff.
8-13-99.)
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(35 ILCS 5/601) (from Ch. 120, par. 6-601)
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Sec. 601. Payment on Due Date of Return.
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(a) In general. Every taxpayer required to file a return | ||
under
this Act shall, without assessment, notice or demand, pay | ||
any tax due
thereon to the Department, at the place fixed for | ||
filing, on or before
the date fixed for filing such return | ||
(determined without regard to any
extension of time for filing | ||
the return) pursuant to regulations
prescribed by the | ||
Department.
If, however, the due date for payment of a | ||
taxpayer's federal income tax
liability for a tax year (as | ||
provided in the Internal Revenue Code or by
Treasury | ||
regulation, or as extended by the Internal Revenue Service) is | ||
later
than the date fixed for filing the taxpayer's Illinois | ||
income tax return for
that tax year, the Department may, by | ||
rule, prescribe a due date for payment
that is not later than | ||
the due date for payment of the taxpayer's federal
income tax | ||
liability. For purposes of the Illinois Administrative | ||
Procedure
Act, the adoption of rules to prescribe a later due | ||
date for payment shall be
deemed an emergency and necessary for | ||
the public interest, safety, and
welfare.
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(b) Amount payable. In making payment as provided in this
| ||
section there shall remain payable only the balance of such tax
| ||
remaining due after giving effect to the following:
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(1) Withheld tax. Any amount withheld during any | ||
calendar year
pursuant to Article 7 from compensation paid | ||
to a taxpayer shall be
deemed to have been paid on account | ||
of any tax imposed by subsections 201(a)
and (b) of this | ||
Act on
such taxpayer for his taxable year beginning in such | ||
calendar year. If
more than one taxable year begins in a | ||
calendar year, such amount shall
be deemed to have been | ||
paid on account of such tax for the last taxable
year so | ||
beginning.
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(2) Estimated and tentative tax payments. Any amount of |
estimated tax
paid by a taxpayer pursuant to Article 8 for | ||
a taxable year shall be deemed to
have been paid on account | ||
of the tax imposed by this Act for such
taxable year.
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(3) Foreign tax. The aggregate amount of tax which is | ||
imposed
upon or measured by income and which is paid by a | ||
resident for a taxable
year to another state or states on | ||
income which is also subject to the tax
imposed by | ||
subsections 201(a) and (b) of this Act shall be credited | ||
against
the tax imposed by subsections 201(a) and (b) | ||
otherwise due under
this Act for such taxable year. The | ||
aggregate credit provided under this
paragraph shall not | ||
exceed that amount which bears the same ratio to the tax
| ||
imposed by subsections 201(a) and (b) otherwise due under | ||
this Act as the
amount of the taxpayer's base income | ||
subject to tax both by such other state or
states and by | ||
this State bears to his total base income subject to tax by | ||
this
State for the taxable year. For purposes of this | ||
subsection, no compensation
received by a resident which | ||
qualifies as compensation paid in this State as
determined | ||
under Section 304(a)(2)(B) shall be considered income | ||
subject to
tax by another state or states. The credit | ||
provided by this paragraph shall
not be allowed if any | ||
creditable tax was deducted in determining base income
for | ||
the taxable year. Any person claiming such credit shall | ||
attach a
statement in support thereof and shall notify the | ||
Director of any refund
or reductions in the amount of tax | ||
claimed as a credit hereunder all in
such manner and at | ||
such time as the Department shall by regulations prescribe.
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(4) Accumulation and capital gain distributions. If | ||
the net
income of a taxpayer includes amounts included in | ||
his base income by
reason of Section 668 or 669 of the | ||
Internal Revenue Code (relating to
accumulation and | ||
capital gain distributions by a trust, respectively),
the | ||
tax imposed on such taxpayer by this Act shall be credited | ||
with his
pro rata portion of the taxes imposed by this Act | ||
on such trust for
preceding taxable years which would not |
have been payable for such
preceding years if the trust had | ||
in fact made distributions to its
beneficiaries at the | ||
times and in the amounts specified in Sections 666
and 669 | ||
of the Internal Revenue Code. The credit provided by this
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paragraph shall not reduce the tax otherwise due from the | ||
taxpayer to an
amount less than that which would be due if | ||
the amounts included by
reason of Sections 668 and 669 of | ||
the Internal Revenue Code were
excluded from his base | ||
income.
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(c) Cross reference. For application against tax due of
| ||
overpayments of tax for a prior year, see Section 909.
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(Source: P.A. 92-826, eff. 8-21-02.)
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