(35 ILCS 10/5‑1) Sec. 5‑1. Short title. This Article may be cited as the Economic Development for a Growing Economy Tax Credit Act. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑3) Sec. 5‑3. Purpose. The General Assembly finds that the Illinois economy, although currently strong, is still highly vulnerable to other states and nations that have major financial incentive programs for medium‑sized and large firm relocations. Because of the incentive programs of these competitor locations, Illinois must move aggressively with new business development investment tools so that Illinois is more competitive in site location decision‑making. The State must not only continue to work with firms to help them locate their new plants and facilities in Illinois but also must provide competitive investment location tax credits in support of the location and expansion of medium‑sized and large operations of commerce and industry. In an increasingly global economy, Illinois' long‑term development would benefit from rational, strategic use of State resources in support of business development and growth. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑5) Sec. 5‑5. Definitions. As used in this Act: "Agreement" means the Agreement between a Taxpayer and the Department under the provisions of Section 5‑50 of this Act. "Applicant" means a Taxpayer that is operating a business located or that the Taxpayer plans to locate within the State of Illinois and that is engaged in interstate or intrastate commerce for the purpose of manufacturing, processing, assembling, warehousing, or distributing products, conducting research and development, providing tourism services, or providing services in interstate commerce, office industries, or agricultural processing, but excluding retail, retail food, health, or professional services. "Applicant" does not include a Taxpayer who closes or substantially reduces an operation at one location in the State and relocates substantially the same operation to another location in the State. This does not prohibit a Taxpayer from expanding its operations at another location in the State, provided that existing operations of a similar nature located within the State are not closed or substantially reduced. This also does not prohibit a Taxpayer from moving its operations from one location in the State to another location in the State for the purpose of expanding the operation provided that the Department determines that expansion cannot reasonably be accommodated within the municipality in which the business is located, or in the case of a business located in an incorporated area of the county, within the county in which the business is located, after conferring with the chief elected official of the municipality or county and taking into consideration any evidence offered by the municipality or county regarding the ability to accommodate expansion within the municipality or county. "Committee" means the Illinois Business Investment Committee created under Section 5‑25 of this Act within the Illinois Economic Development Board. "Credit" means the amount agreed to between the Department and Applicant under this Act, but not to exceed the Incremental Income Tax attributable to the Applicant's project. "Department" means the Department of Commerce and Economic Opportunity. "Director" means the Director of Commerce and Economic Opportunity. "Full‑time Employee" means an individual who is employed for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment. An individual for whom a W‑2 is issued by a Professional Employer Organization (PEO) is a full‑time employee if employed in the service of the Applicant for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment to Applicant. "Incremental Income Tax" means the total amount withheld during the taxable year from the compensation of New Employees under Article 7 of the Illinois Income Tax Act arising from employment at a project that is the subject of an Agreement. "New Employee" means: (a) A Full‑time Employee first employed by a
Taxpayer in the project that is the subject of an Agreement and who is hired after the Taxpayer enters into the tax credit Agreement.
(b) The term "New Employee" does not include: (1) an employee of the Taxpayer who performs a
job that was previously performed by another employee, if that job existed for at least 6 months before hiring the employee;
(2) an employee of the Taxpayer who was
previously employed in Illinois by a Related Member of the Taxpayer and whose employment was shifted to the Taxpayer after the Taxpayer entered into the tax credit Agreement; or
(3) a child, grandchild, parent, or spouse,
other than a spouse who is legally separated from the individual, of any individual who has a direct or an indirect ownership interest of at least 5% in the profits, capital, or value of the Taxpayer.
(c) Notwithstanding paragraph (1) of subsection (b),
an employee may be considered a New Employee under the Agreement if the employee performs a job that was previously performed by an employee who was:
(1) treated under the Agreement as a New
Employee; and
(2) promoted by the Taxpayer to another job. (d) Notwithstanding subsection (a), the Department
may award Credit to an Applicant with respect to an employee hired prior to the date of the Agreement if:
(1) the Applicant is in receipt of a letter from
the Department stating an intent to enter into a credit Agreement;
(2) the letter described in paragraph (1) is
issued by the Department not later than 15 days after the effective date of this Act; and
(3) the employee was hired after the date the
letter described in paragraph (1) was issued.
"Noncompliance Date" means, in the case of a Taxpayer that is not complying with the requirements of the Agreement or the provisions of this Act, the day following the last date upon which the Taxpayer was in compliance with the requirements of the Agreement and the provisions of this Act, as determined by the Director, pursuant to Section 5‑65. "Pass Through Entity" means an entity that is exempt from the tax under subsection (b) or (c) of Section 205 of the Illinois Income Tax Act. "Professional Employer Organization" (PEO) means an employee leasing company, as defined in Section 206.1(A)(2) of the Illinois Unemployment Insurance Act. "Related Member" means a person that, with respect to the Taxpayer during any portion of the taxable year, is any one of the following: (1) An individual stockholder, if the stockholder
and the members of the stockholder's family (as defined in Section 318 of the Internal Revenue Code) own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the value of the Taxpayer's outstanding stock.
(2) A partnership, estate, or trust and any partner
or beneficiary, if the partnership, estate, or trust, and its partners or beneficiaries own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the profits, capital, stock, or value of the Taxpayer.
(3) A corporation, and any party related to the
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the Taxpayer owns directly, indirectly, beneficially, or constructively at least 50% of the value of the corporation's outstanding stock.
(4) A corporation and any party related to that
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the corporation and all such related parties own in the aggregate at least 50% of the profits, capital, stock, or value of the Taxpayer.
(5) A person to or from whom there is attribution of
stock ownership in accordance with Section 1563(e) of the Internal Revenue Code, except, for purposes of determining whether a person is a Related Member under this paragraph, 20% shall be substituted for 5% wherever 5% appears in Section 1563(e) of the Internal Revenue Code.
"Taxpayer" means an individual, corporation, partnership, or other entity that has any Illinois Income Tax liability. (Source: P.A. 94‑793, eff. 5‑19‑06; 95‑375, eff. 8‑23‑07.)
(35 ILCS 10/5‑10) Sec. 5‑10. Powers of the Department. The Department, in addition to those powers granted under the Civil Administrative Code of Illinois, is granted and shall have all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this Act, including, but not limited to, power and authority to: (a) Promulgate procedures, rules, or regulations deemed necessary and appropriate for the administration of the programs; establish forms for applications, notifications, contracts, or any other agreements; and accept applications at any time during the year. (b) Provide and assist Taxpayers pursuant to the provisions of this Act, and cooperate with Taxpayers that are parties to Agreements to promote, foster, and support economic development, capital investment, and job creation or retention within the State. (c) Enter into agreements and memoranda of understanding for participation of and engage in cooperation with agencies of the federal government, local units of government, universities, research foundations or institutions, regional economic development corporations, or other organizations for the purposes of this Act. (d) Gather information and conduct inquiries, in the manner and by the methods as it deems desirable, including without limitation, gathering information with respect to Applicants for the purpose of making any designations or certifications necessary or desirable or to gather information to assist the Committee with any recommendation or guidance in the furtherance of the purposes of this Act. (e) Establish, negotiate and effectuate any term, agreement or other document with any person, necessary or appropriate to accomplish the purposes of this Act; and to consent, subject to the provisions of any Agreement with another party, to the modification or restructuring of any Agreement to which the Department is a party. (f) Fix, determine, charge, and collect any premiums, fees, charges, costs, and expenses from Applicants, including, without limitation, any application fees, commitment fees, program fees, financing charges, or publication fees as deemed appropriate to pay expenses necessary or incident to the administration, staffing, or operation in connection with the Department's or Committee's activities under this Act, or for preparation, implementation, and enforcement of the terms of the Agreement, or for consultation, advisory and legal fees, and other costs; however, all fees and expenses incident thereto shall be the responsibility of the Applicant. (g) Provide for sufficient personnel to permit administration, staffing, operation, and related support required to adequately discharge its duties and responsibilities described in this Act from funds made available through charges to Applicants or from funds as may be appropriated by the General Assembly for the administration of this Act. (h) Require Applicants, upon written request, to issue any necessary authorization to the appropriate federal, state, or local authority for the release of information concerning a project being considered under the provisions of this Act, with the information requested to include, but not be limited to, financial reports, returns, or records relating to the Taxpayers' or its project. (i) Require that a Taxpayer shall at all times keep proper books of record and account in accordance with generally accepted accounting principles consistently applied, with the books, records, or papers related to the Agreement in the custody or control of the Taxpayer open for reasonable Department inspection and audits, and including, without limitation, the making of copies of the books, records, or papers, and the inspection or appraisal of any of the Taxpayer or project assets. (j) Take whatever actions are necessary or appropriate to protect the State's interest in the event of bankruptcy, default, foreclosure, or noncompliance with the terms and conditions of financial assistance or participation required under this Act, including the power to sell, dispose, lease, or rent, upon terms and conditions determined by the Director to be appropriate, real or personal property that the Department may receive as a result of these actions. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑15) Sec. 5‑15. Tax Credit Awards. Subject to the conditions set forth in this Act, a Taxpayer is entitled to a Credit against or, as described in subsection (g) of this Section, a payment towards taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act that may be imposed on the Taxpayer for a taxable year beginning on or after January 1, 1999, if the Taxpayer is awarded a Credit by the Department under this Act for that taxable year. (a) The Department shall make Credit awards under this Act to foster job creation and retention in Illinois. (b) A person that proposes a project to create new jobs in Illinois must enter into an Agreement with the Department for the Credit under this Act. (c) The Credit shall be claimed for the taxable years specified in the Agreement. (d) The Credit shall not exceed the Incremental Income Tax attributable to the project that is the subject of the Agreement. (e) Nothing herein shall prohibit a Tax Credit Award to an Applicant that uses a PEO if all other award criteria are satisfied. (f) In lieu of the Credit allowed under this Act against the taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act for any taxable year ending on or after December 31, 2009, the Taxpayer may elect to claim the Credit against its obligation to pay over withholding under Section 704A of the Illinois Income Tax Act. (1) The election under this subsection (f) may be
made only by a Taxpayer that (i) is primarily engaged in one of the following business activities: motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing and (ii) meets the following criteria:
(A) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, (iii) has an Agreement under this Act on December 14, 2009 (the effective date of Public Act 96‑834), and (iv) is in compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, and (iii) has applied for an Agreement within 365 days after December 14, 2009 (the effective date of Public Act 96‑834); or
(C) the Taxpayer (i) had an Illinois net
operating loss carryforward under Section 207 of the Illinois Income Tax Act in a taxable year ending during calendar year 2008, (ii) has applied for an Agreement within 150 days after the effective date of this amendatory Act of the 96th General Assembly, (iii) creates at least 400 new jobs in Illinois, (iv) retains at least 2,000 jobs in Illinois that would have been at risk of relocation out of Illinois over a 10‑year period, and (v) makes a capital investment of at least $75,000,000.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under Section 704A of the Illinois Income Tax Act during the first calendar year beginning after the end of the taxable year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f) elects to claim the Credit against its withholdings as provided in this subsection (f), then, on and after the date of the election, the terms of the Agreement between the Taxpayer and the Department may not be further amended during the term of the Agreement.
(g) A pass‑through entity that has been awarded a credit under this Act, its shareholders, or its partners may treat some or all of the credit awarded pursuant to this Act as a tax payment for purposes of the Illinois Income Tax Act. The term "tax payment" means a payment as described in Article 6 or Article 8 of the Illinois Income Tax Act or a composite payment made by a pass‑through entity on behalf of any of its shareholders or partners to satisfy such shareholders' or partners' taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act. In no event shall the amount of the award credited pursuant to this Act exceed the Illinois income tax liability of the pass‑through entity or its shareholders or partners for the taxable year. (Source: P.A. 95‑375, eff. 8‑23‑07; 96‑834, eff. 12‑14‑09; 96‑836, eff. 12‑16‑09; 96‑905, eff. 6‑4‑10; 96‑1000, eff. 7‑2‑10.)
(35 ILCS 10/5‑20) Sec. 5‑20. Application for a project to create and retain new jobs. (a) Any Taxpayer proposing a project located or planned to be located in Illinois may request consideration for designation of its project, by formal written letter of request or by formal application to the Department, in which the Applicant states its intent to make at least a specified level of investment and intends to hire or retain a specified number of full‑time employees at a designated location in Illinois. As circumstances require, the Department may require a formal application from an Applicant and a formal letter of request for assistance. (b) In order to qualify for Credits under this Act, an Applicant's project must: (1) involve an investment of at least $5,000,000 in
capital improvements to be placed in service and to employ at least 25 New Employees within the State as a direct result of the project;
(2) involve an investment of at least an amount (to
be expressly specified by the Department and the Committee) in capital improvements to be placed in service and will employ at least an amount (to be expressly specified by the Department and the Committee) of New Employees within the State, provided that the Department and the Committee have determined that the project will provide a substantial economic benefit to the State; or
(3) if the applicant has 100 or fewer employees,
involve an investment of at least $1,000,000 in capital improvements to be placed in service and to employ at least 5 New Employees within the State as a direct result of the project.
(c) After receipt of an application, the Department may enter into an Agreement with the Applicant if the application is accepted in accordance with Section 5‑25. (Source: P.A. 93‑882, eff. 1‑1‑05.)
(35 ILCS 10/5‑25) Sec. 5‑25. Review of Application. (a) In addition to those duties granted under the Illinois Economic Development Board Act, the Illinois Economic Development Board shall form a Business Investment Committee for the purpose of making recommendations for applications. At the request of the Board, the Director of Commerce and Economic Opportunity or his or her designee, the Director of the Governor's Office of Management and Budget or his or her designee, the Director of Revenue or his or her designee, the Director of Employment Security or his or her designee, and an elected official of the affected locality, such as the chair of the county board or the mayor, may serve as members of the Committee to assist with its analysis and deliberations. (b) At the Department's request, the Committee shall convene, make inquiries, and conduct studies in the manner and by the methods as it deems desirable, review information with respect to Applicants, and make recommendations for projects to benefit the State. In making its recommendation that an Applicant's application for Credit should or should not be accepted, which shall occur within a reasonable time frame as determined by the nature of the application, the Committee shall determine that all the following conditions exist: (1) The Applicant's project intends, as required by
subsection (b) of Section 5‑20 to make the required investment in the State and intends to hire the required number of New Employees in Illinois as a result of that project.
(2) The Applicant's project is economically sound
and will benefit the people of the State of Illinois by increasing opportunities for employment and strengthen the economy of Illinois.
(3) That, if not for the Credit, the project would
not occur in Illinois, which may be demonstrated by any means including, but not limited to, evidence the Applicant has multi‑state location options and could reasonably and efficiently locate outside of the State, or demonstration that at least one other state is being considered for the project, or evidence the receipt of the Credit is a major factor in the Applicant's decision and that without the Credit, the Applicant likely would not create new jobs in Illinois, or demonstration that receiving the Credit is essential to the Applicant's decision to create or retain new jobs in the State.
(4) A cost differential is identified, using best
available data, in the projected costs for the Applicant's project compared to the costs in the competing state, including the impact of the competing state's incentive programs. The competing state's incentive programs shall include state, local, private, and federal funds available.
(5) The political subdivisions affected by the
project have committed local incentives with respect to the project, considering local ability to assist.
(6) Awarding the Credit will result in an overall
positive fiscal impact to the State, as certified by the Committee using the best available data.
(7) The Credit is not prohibited by Section 5‑35 of
this Act.
(Source: P.A. 94‑793, eff. 5‑19‑06.)
(35 ILCS 10/5‑30) Sec. 5‑30. Limitation to amount of costs of specified items. The total amount of the Credit allowed during all tax years may not exceed the aggregate amount of costs incurred by the Taxpayer during all prior tax years for the following items, to the extent provided in the Agreement: (1) capital investment, including, but not limited
to, equipment, buildings, or land;
(2) infrastructure development; (3) debt service, except refinancing of current debt; (4) research and development; (5) job training and education; (6) lease costs; or (7) relocation costs. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑35) Sec. 5‑35. Relocation of jobs in Illinois. A taxpayer is not entitled to claim the credit provided by this Act with respect to any jobs that the taxpayer relocates from one site in Illinois to another site in Illinois. A taxpayer with respect to a qualifying project certified under the Corporate Headquarters Relocation Act, however, is not subject to the requirements of this Section but is nevertheless considered an applicant for purposes of this Act. Moreover, any full‑time employee of an eligible business relocated to Illinois in connection with that qualifying project is deemed to be a new employee for purposes of this Act. Determinations under this Section shall be made by the Department. (Source: P.A. 91‑476, eff. 8‑11‑99; 92‑207, eff. 8‑1‑01.)
(35 ILCS 10/5‑40) Sec. 5‑40. Determination of Amount of the Credit. In determining the amount of the Credit that should be awarded, the Committee shall provide guidance on, and the Department shall take into consideration, the following factors: (1) The number and location of jobs created and
retained in relation to the economy of the county where the projected investment is to occur.
(2) The potential impact on the economy of Illinois. (3) The magnitude of the cost differential between
Illinois and the competing state.
(4) The incremental payroll attributable to the
project.
(5) The capital investment attributable to the
project.
(6) The amount of the average wage and benefits paid
by the Applicant in relation to the wage and benefits of the area of the project.
(7) The costs to Illinois and the affected political
(35 ILCS 10/5‑1) Sec. 5‑1. Short title. This Article may be cited as the Economic Development for a Growing Economy Tax Credit Act. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑3) Sec. 5‑3. Purpose. The General Assembly finds that the Illinois economy, although currently strong, is still highly vulnerable to other states and nations that have major financial incentive programs for medium‑sized and large firm relocations. Because of the incentive programs of these competitor locations, Illinois must move aggressively with new business development investment tools so that Illinois is more competitive in site location decision‑making. The State must not only continue to work with firms to help them locate their new plants and facilities in Illinois but also must provide competitive investment location tax credits in support of the location and expansion of medium‑sized and large operations of commerce and industry. In an increasingly global economy, Illinois' long‑term development would benefit from rational, strategic use of State resources in support of business development and growth. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑5) Sec. 5‑5. Definitions. As used in this Act: "Agreement" means the Agreement between a Taxpayer and the Department under the provisions of Section 5‑50 of this Act. "Applicant" means a Taxpayer that is operating a business located or that the Taxpayer plans to locate within the State of Illinois and that is engaged in interstate or intrastate commerce for the purpose of manufacturing, processing, assembling, warehousing, or distributing products, conducting research and development, providing tourism services, or providing services in interstate commerce, office industries, or agricultural processing, but excluding retail, retail food, health, or professional services. "Applicant" does not include a Taxpayer who closes or substantially reduces an operation at one location in the State and relocates substantially the same operation to another location in the State. This does not prohibit a Taxpayer from expanding its operations at another location in the State, provided that existing operations of a similar nature located within the State are not closed or substantially reduced. This also does not prohibit a Taxpayer from moving its operations from one location in the State to another location in the State for the purpose of expanding the operation provided that the Department determines that expansion cannot reasonably be accommodated within the municipality in which the business is located, or in the case of a business located in an incorporated area of the county, within the county in which the business is located, after conferring with the chief elected official of the municipality or county and taking into consideration any evidence offered by the municipality or county regarding the ability to accommodate expansion within the municipality or county. "Committee" means the Illinois Business Investment Committee created under Section 5‑25 of this Act within the Illinois Economic Development Board. "Credit" means the amount agreed to between the Department and Applicant under this Act, but not to exceed the Incremental Income Tax attributable to the Applicant's project. "Department" means the Department of Commerce and Economic Opportunity. "Director" means the Director of Commerce and Economic Opportunity. "Full‑time Employee" means an individual who is employed for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment. An individual for whom a W‑2 is issued by a Professional Employer Organization (PEO) is a full‑time employee if employed in the service of the Applicant for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment to Applicant. "Incremental Income Tax" means the total amount withheld during the taxable year from the compensation of New Employees under Article 7 of the Illinois Income Tax Act arising from employment at a project that is the subject of an Agreement. "New Employee" means: (a) A Full‑time Employee first employed by a
Taxpayer in the project that is the subject of an Agreement and who is hired after the Taxpayer enters into the tax credit Agreement.
(b) The term "New Employee" does not include: (1) an employee of the Taxpayer who performs a
job that was previously performed by another employee, if that job existed for at least 6 months before hiring the employee;
(2) an employee of the Taxpayer who was
previously employed in Illinois by a Related Member of the Taxpayer and whose employment was shifted to the Taxpayer after the Taxpayer entered into the tax credit Agreement; or
(3) a child, grandchild, parent, or spouse,
other than a spouse who is legally separated from the individual, of any individual who has a direct or an indirect ownership interest of at least 5% in the profits, capital, or value of the Taxpayer.
(c) Notwithstanding paragraph (1) of subsection (b),
an employee may be considered a New Employee under the Agreement if the employee performs a job that was previously performed by an employee who was:
(1) treated under the Agreement as a New
Employee; and
(2) promoted by the Taxpayer to another job. (d) Notwithstanding subsection (a), the Department
may award Credit to an Applicant with respect to an employee hired prior to the date of the Agreement if:
(1) the Applicant is in receipt of a letter from
the Department stating an intent to enter into a credit Agreement;
(2) the letter described in paragraph (1) is
issued by the Department not later than 15 days after the effective date of this Act; and
(3) the employee was hired after the date the
letter described in paragraph (1) was issued.
"Noncompliance Date" means, in the case of a Taxpayer that is not complying with the requirements of the Agreement or the provisions of this Act, the day following the last date upon which the Taxpayer was in compliance with the requirements of the Agreement and the provisions of this Act, as determined by the Director, pursuant to Section 5‑65. "Pass Through Entity" means an entity that is exempt from the tax under subsection (b) or (c) of Section 205 of the Illinois Income Tax Act. "Professional Employer Organization" (PEO) means an employee leasing company, as defined in Section 206.1(A)(2) of the Illinois Unemployment Insurance Act. "Related Member" means a person that, with respect to the Taxpayer during any portion of the taxable year, is any one of the following: (1) An individual stockholder, if the stockholder
and the members of the stockholder's family (as defined in Section 318 of the Internal Revenue Code) own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the value of the Taxpayer's outstanding stock.
(2) A partnership, estate, or trust and any partner
or beneficiary, if the partnership, estate, or trust, and its partners or beneficiaries own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the profits, capital, stock, or value of the Taxpayer.
(3) A corporation, and any party related to the
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the Taxpayer owns directly, indirectly, beneficially, or constructively at least 50% of the value of the corporation's outstanding stock.
(4) A corporation and any party related to that
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the corporation and all such related parties own in the aggregate at least 50% of the profits, capital, stock, or value of the Taxpayer.
(5) A person to or from whom there is attribution of
stock ownership in accordance with Section 1563(e) of the Internal Revenue Code, except, for purposes of determining whether a person is a Related Member under this paragraph, 20% shall be substituted for 5% wherever 5% appears in Section 1563(e) of the Internal Revenue Code.
"Taxpayer" means an individual, corporation, partnership, or other entity that has any Illinois Income Tax liability. (Source: P.A. 94‑793, eff. 5‑19‑06; 95‑375, eff. 8‑23‑07.)
(35 ILCS 10/5‑10) Sec. 5‑10. Powers of the Department. The Department, in addition to those powers granted under the Civil Administrative Code of Illinois, is granted and shall have all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this Act, including, but not limited to, power and authority to: (a) Promulgate procedures, rules, or regulations deemed necessary and appropriate for the administration of the programs; establish forms for applications, notifications, contracts, or any other agreements; and accept applications at any time during the year. (b) Provide and assist Taxpayers pursuant to the provisions of this Act, and cooperate with Taxpayers that are parties to Agreements to promote, foster, and support economic development, capital investment, and job creation or retention within the State. (c) Enter into agreements and memoranda of understanding for participation of and engage in cooperation with agencies of the federal government, local units of government, universities, research foundations or institutions, regional economic development corporations, or other organizations for the purposes of this Act. (d) Gather information and conduct inquiries, in the manner and by the methods as it deems desirable, including without limitation, gathering information with respect to Applicants for the purpose of making any designations or certifications necessary or desirable or to gather information to assist the Committee with any recommendation or guidance in the furtherance of the purposes of this Act. (e) Establish, negotiate and effectuate any term, agreement or other document with any person, necessary or appropriate to accomplish the purposes of this Act; and to consent, subject to the provisions of any Agreement with another party, to the modification or restructuring of any Agreement to which the Department is a party. (f) Fix, determine, charge, and collect any premiums, fees, charges, costs, and expenses from Applicants, including, without limitation, any application fees, commitment fees, program fees, financing charges, or publication fees as deemed appropriate to pay expenses necessary or incident to the administration, staffing, or operation in connection with the Department's or Committee's activities under this Act, or for preparation, implementation, and enforcement of the terms of the Agreement, or for consultation, advisory and legal fees, and other costs; however, all fees and expenses incident thereto shall be the responsibility of the Applicant. (g) Provide for sufficient personnel to permit administration, staffing, operation, and related support required to adequately discharge its duties and responsibilities described in this Act from funds made available through charges to Applicants or from funds as may be appropriated by the General Assembly for the administration of this Act. (h) Require Applicants, upon written request, to issue any necessary authorization to the appropriate federal, state, or local authority for the release of information concerning a project being considered under the provisions of this Act, with the information requested to include, but not be limited to, financial reports, returns, or records relating to the Taxpayers' or its project. (i) Require that a Taxpayer shall at all times keep proper books of record and account in accordance with generally accepted accounting principles consistently applied, with the books, records, or papers related to the Agreement in the custody or control of the Taxpayer open for reasonable Department inspection and audits, and including, without limitation, the making of copies of the books, records, or papers, and the inspection or appraisal of any of the Taxpayer or project assets. (j) Take whatever actions are necessary or appropriate to protect the State's interest in the event of bankruptcy, default, foreclosure, or noncompliance with the terms and conditions of financial assistance or participation required under this Act, including the power to sell, dispose, lease, or rent, upon terms and conditions determined by the Director to be appropriate, real or personal property that the Department may receive as a result of these actions. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑15) Sec. 5‑15. Tax Credit Awards. Subject to the conditions set forth in this Act, a Taxpayer is entitled to a Credit against or, as described in subsection (g) of this Section, a payment towards taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act that may be imposed on the Taxpayer for a taxable year beginning on or after January 1, 1999, if the Taxpayer is awarded a Credit by the Department under this Act for that taxable year. (a) The Department shall make Credit awards under this Act to foster job creation and retention in Illinois. (b) A person that proposes a project to create new jobs in Illinois must enter into an Agreement with the Department for the Credit under this Act. (c) The Credit shall be claimed for the taxable years specified in the Agreement. (d) The Credit shall not exceed the Incremental Income Tax attributable to the project that is the subject of the Agreement. (e) Nothing herein shall prohibit a Tax Credit Award to an Applicant that uses a PEO if all other award criteria are satisfied. (f) In lieu of the Credit allowed under this Act against the taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act for any taxable year ending on or after December 31, 2009, the Taxpayer may elect to claim the Credit against its obligation to pay over withholding under Section 704A of the Illinois Income Tax Act. (1) The election under this subsection (f) may be
made only by a Taxpayer that (i) is primarily engaged in one of the following business activities: motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing and (ii) meets the following criteria:
(A) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, (iii) has an Agreement under this Act on December 14, 2009 (the effective date of Public Act 96‑834), and (iv) is in compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, and (iii) has applied for an Agreement within 365 days after December 14, 2009 (the effective date of Public Act 96‑834); or
(C) the Taxpayer (i) had an Illinois net
operating loss carryforward under Section 207 of the Illinois Income Tax Act in a taxable year ending during calendar year 2008, (ii) has applied for an Agreement within 150 days after the effective date of this amendatory Act of the 96th General Assembly, (iii) creates at least 400 new jobs in Illinois, (iv) retains at least 2,000 jobs in Illinois that would have been at risk of relocation out of Illinois over a 10‑year period, and (v) makes a capital investment of at least $75,000,000.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under Section 704A of the Illinois Income Tax Act during the first calendar year beginning after the end of the taxable year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f) elects to claim the Credit against its withholdings as provided in this subsection (f), then, on and after the date of the election, the terms of the Agreement between the Taxpayer and the Department may not be further amended during the term of the Agreement.
(g) A pass‑through entity that has been awarded a credit under this Act, its shareholders, or its partners may treat some or all of the credit awarded pursuant to this Act as a tax payment for purposes of the Illinois Income Tax Act. The term "tax payment" means a payment as described in Article 6 or Article 8 of the Illinois Income Tax Act or a composite payment made by a pass‑through entity on behalf of any of its shareholders or partners to satisfy such shareholders' or partners' taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act. In no event shall the amount of the award credited pursuant to this Act exceed the Illinois income tax liability of the pass‑through entity or its shareholders or partners for the taxable year. (Source: P.A. 95‑375, eff. 8‑23‑07; 96‑834, eff. 12‑14‑09; 96‑836, eff. 12‑16‑09; 96‑905, eff. 6‑4‑10; 96‑1000, eff. 7‑2‑10.)
(35 ILCS 10/5‑20) Sec. 5‑20. Application for a project to create and retain new jobs. (a) Any Taxpayer proposing a project located or planned to be located in Illinois may request consideration for designation of its project, by formal written letter of request or by formal application to the Department, in which the Applicant states its intent to make at least a specified level of investment and intends to hire or retain a specified number of full‑time employees at a designated location in Illinois. As circumstances require, the Department may require a formal application from an Applicant and a formal letter of request for assistance. (b) In order to qualify for Credits under this Act, an Applicant's project must: (1) involve an investment of at least $5,000,000 in
capital improvements to be placed in service and to employ at least 25 New Employees within the State as a direct result of the project;
(2) involve an investment of at least an amount (to
be expressly specified by the Department and the Committee) in capital improvements to be placed in service and will employ at least an amount (to be expressly specified by the Department and the Committee) of New Employees within the State, provided that the Department and the Committee have determined that the project will provide a substantial economic benefit to the State; or
(3) if the applicant has 100 or fewer employees,
involve an investment of at least $1,000,000 in capital improvements to be placed in service and to employ at least 5 New Employees within the State as a direct result of the project.
(c) After receipt of an application, the Department may enter into an Agreement with the Applicant if the application is accepted in accordance with Section 5‑25. (Source: P.A. 93‑882, eff. 1‑1‑05.)
(35 ILCS 10/5‑25) Sec. 5‑25. Review of Application. (a) In addition to those duties granted under the Illinois Economic Development Board Act, the Illinois Economic Development Board shall form a Business Investment Committee for the purpose of making recommendations for applications. At the request of the Board, the Director of Commerce and Economic Opportunity or his or her designee, the Director of the Governor's Office of Management and Budget or his or her designee, the Director of Revenue or his or her designee, the Director of Employment Security or his or her designee, and an elected official of the affected locality, such as the chair of the county board or the mayor, may serve as members of the Committee to assist with its analysis and deliberations. (b) At the Department's request, the Committee shall convene, make inquiries, and conduct studies in the manner and by the methods as it deems desirable, review information with respect to Applicants, and make recommendations for projects to benefit the State. In making its recommendation that an Applicant's application for Credit should or should not be accepted, which shall occur within a reasonable time frame as determined by the nature of the application, the Committee shall determine that all the following conditions exist: (1) The Applicant's project intends, as required by
subsection (b) of Section 5‑20 to make the required investment in the State and intends to hire the required number of New Employees in Illinois as a result of that project.
(2) The Applicant's project is economically sound
and will benefit the people of the State of Illinois by increasing opportunities for employment and strengthen the economy of Illinois.
(3) That, if not for the Credit, the project would
not occur in Illinois, which may be demonstrated by any means including, but not limited to, evidence the Applicant has multi‑state location options and could reasonably and efficiently locate outside of the State, or demonstration that at least one other state is being considered for the project, or evidence the receipt of the Credit is a major factor in the Applicant's decision and that without the Credit, the Applicant likely would not create new jobs in Illinois, or demonstration that receiving the Credit is essential to the Applicant's decision to create or retain new jobs in the State.
(4) A cost differential is identified, using best
available data, in the projected costs for the Applicant's project compared to the costs in the competing state, including the impact of the competing state's incentive programs. The competing state's incentive programs shall include state, local, private, and federal funds available.
(5) The political subdivisions affected by the
project have committed local incentives with respect to the project, considering local ability to assist.
(6) Awarding the Credit will result in an overall
positive fiscal impact to the State, as certified by the Committee using the best available data.
(7) The Credit is not prohibited by Section 5‑35 of
this Act.
(Source: P.A. 94‑793, eff. 5‑19‑06.)
(35 ILCS 10/5‑30) Sec. 5‑30. Limitation to amount of costs of specified items. The total amount of the Credit allowed during all tax years may not exceed the aggregate amount of costs incurred by the Taxpayer during all prior tax years for the following items, to the extent provided in the Agreement: (1) capital investment, including, but not limited
to, equipment, buildings, or land;
(2) infrastructure development; (3) debt service, except refinancing of current debt; (4) research and development; (5) job training and education; (6) lease costs; or (7) relocation costs. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑35) Sec. 5‑35. Relocation of jobs in Illinois. A taxpayer is not entitled to claim the credit provided by this Act with respect to any jobs that the taxpayer relocates from one site in Illinois to another site in Illinois. A taxpayer with respect to a qualifying project certified under the Corporate Headquarters Relocation Act, however, is not subject to the requirements of this Section but is nevertheless considered an applicant for purposes of this Act. Moreover, any full‑time employee of an eligible business relocated to Illinois in connection with that qualifying project is deemed to be a new employee for purposes of this Act. Determinations under this Section shall be made by the Department. (Source: P.A. 91‑476, eff. 8‑11‑99; 92‑207, eff. 8‑1‑01.)
(35 ILCS 10/5‑40) Sec. 5‑40. Determination of Amount of the Credit. In determining the amount of the Credit that should be awarded, the Committee shall provide guidance on, and the Department shall take into consideration, the following factors: (1) The number and location of jobs created and
retained in relation to the economy of the county where the projected investment is to occur.
(2) The potential impact on the economy of Illinois. (3) The magnitude of the cost differential between
Illinois and the competing state.
(4) The incremental payroll attributable to the
project.
(5) The capital investment attributable to the
project.
(6) The amount of the average wage and benefits paid
by the Applicant in relation to the wage and benefits of the area of the project.
(7) The costs to Illinois and the affected political
subdivisions with respect to the project.
(8) The financial assistance that is otherwise
{"@context":"https://schema.org","@graph":[{"@type":"WebPage","@id":"https://statutes.laws.com/test/","url":"https://statutes.laws.com/test/","name":"State Codes and Statutes - Statutes","isPartOf":{"@id":"https://statutes.laws.com/#website"},"datePublished":"2015-03-10T03:31:37+00:00","dateModified":"2019-12-27T23:25:16+00:00","breadcrumb":{"@id":"https://statutes.laws.com/test/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https://statutes.laws.com/test/"]}]},{"@type":"BreadcrumbList","@id":"https://statutes.laws.com/test/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https://statutes.laws.com/"},{"@type":"ListItem","position":2,"name":"State Codes and Statutes"}]},{"@type":"WebSite","@id":"https://statutes.laws.com/#website","url":"https://statutes.laws.com/","name":"Statutes","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://statutes.laws.com/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"}]}
(35 ILCS 10/5‑1) Sec. 5‑1. Short title. This Article may be cited as the Economic Development for a Growing Economy Tax Credit Act. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑3) Sec. 5‑3. Purpose. The General Assembly finds that the Illinois economy, although currently strong, is still highly vulnerable to other states and nations that have major financial incentive programs for medium‑sized and large firm relocations. Because of the incentive programs of these competitor locations, Illinois must move aggressively with new business development investment tools so that Illinois is more competitive in site location decision‑making. The State must not only continue to work with firms to help them locate their new plants and facilities in Illinois but also must provide competitive investment location tax credits in support of the location and expansion of medium‑sized and large operations of commerce and industry. In an increasingly global economy, Illinois' long‑term development would benefit from rational, strategic use of State resources in support of business development and growth. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑5) Sec. 5‑5. Definitions. As used in this Act: "Agreement" means the Agreement between a Taxpayer and the Department under the provisions of Section 5‑50 of this Act. "Applicant" means a Taxpayer that is operating a business located or that the Taxpayer plans to locate within the State of Illinois and that is engaged in interstate or intrastate commerce for the purpose of manufacturing, processing, assembling, warehousing, or distributing products, conducting research and development, providing tourism services, or providing services in interstate commerce, office industries, or agricultural processing, but excluding retail, retail food, health, or professional services. "Applicant" does not include a Taxpayer who closes or substantially reduces an operation at one location in the State and relocates substantially the same operation to another location in the State. This does not prohibit a Taxpayer from expanding its operations at another location in the State, provided that existing operations of a similar nature located within the State are not closed or substantially reduced. This also does not prohibit a Taxpayer from moving its operations from one location in the State to another location in the State for the purpose of expanding the operation provided that the Department determines that expansion cannot reasonably be accommodated within the municipality in which the business is located, or in the case of a business located in an incorporated area of the county, within the county in which the business is located, after conferring with the chief elected official of the municipality or county and taking into consideration any evidence offered by the municipality or county regarding the ability to accommodate expansion within the municipality or county. "Committee" means the Illinois Business Investment Committee created under Section 5‑25 of this Act within the Illinois Economic Development Board. "Credit" means the amount agreed to between the Department and Applicant under this Act, but not to exceed the Incremental Income Tax attributable to the Applicant's project. "Department" means the Department of Commerce and Economic Opportunity. "Director" means the Director of Commerce and Economic Opportunity. "Full‑time Employee" means an individual who is employed for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment. An individual for whom a W‑2 is issued by a Professional Employer Organization (PEO) is a full‑time employee if employed in the service of the Applicant for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full‑time employment to Applicant. "Incremental Income Tax" means the total amount withheld during the taxable year from the compensation of New Employees under Article 7 of the Illinois Income Tax Act arising from employment at a project that is the subject of an Agreement. "New Employee" means: (a) A Full‑time Employee first employed by a
Taxpayer in the project that is the subject of an Agreement and who is hired after the Taxpayer enters into the tax credit Agreement.
(b) The term "New Employee" does not include: (1) an employee of the Taxpayer who performs a
job that was previously performed by another employee, if that job existed for at least 6 months before hiring the employee;
(2) an employee of the Taxpayer who was
previously employed in Illinois by a Related Member of the Taxpayer and whose employment was shifted to the Taxpayer after the Taxpayer entered into the tax credit Agreement; or
(3) a child, grandchild, parent, or spouse,
other than a spouse who is legally separated from the individual, of any individual who has a direct or an indirect ownership interest of at least 5% in the profits, capital, or value of the Taxpayer.
(c) Notwithstanding paragraph (1) of subsection (b),
an employee may be considered a New Employee under the Agreement if the employee performs a job that was previously performed by an employee who was:
(1) treated under the Agreement as a New
Employee; and
(2) promoted by the Taxpayer to another job. (d) Notwithstanding subsection (a), the Department
may award Credit to an Applicant with respect to an employee hired prior to the date of the Agreement if:
(1) the Applicant is in receipt of a letter from
the Department stating an intent to enter into a credit Agreement;
(2) the letter described in paragraph (1) is
issued by the Department not later than 15 days after the effective date of this Act; and
(3) the employee was hired after the date the
letter described in paragraph (1) was issued.
"Noncompliance Date" means, in the case of a Taxpayer that is not complying with the requirements of the Agreement or the provisions of this Act, the day following the last date upon which the Taxpayer was in compliance with the requirements of the Agreement and the provisions of this Act, as determined by the Director, pursuant to Section 5‑65. "Pass Through Entity" means an entity that is exempt from the tax under subsection (b) or (c) of Section 205 of the Illinois Income Tax Act. "Professional Employer Organization" (PEO) means an employee leasing company, as defined in Section 206.1(A)(2) of the Illinois Unemployment Insurance Act. "Related Member" means a person that, with respect to the Taxpayer during any portion of the taxable year, is any one of the following: (1) An individual stockholder, if the stockholder
and the members of the stockholder's family (as defined in Section 318 of the Internal Revenue Code) own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the value of the Taxpayer's outstanding stock.
(2) A partnership, estate, or trust and any partner
or beneficiary, if the partnership, estate, or trust, and its partners or beneficiaries own directly, indirectly, beneficially, or constructively, in the aggregate, at least 50% of the profits, capital, stock, or value of the Taxpayer.
(3) A corporation, and any party related to the
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the Taxpayer owns directly, indirectly, beneficially, or constructively at least 50% of the value of the corporation's outstanding stock.
(4) A corporation and any party related to that
corporation in a manner that would require an attribution of stock from the corporation to the party or from the party to the corporation under the attribution rules of Section 318 of the Internal Revenue Code, if the corporation and all such related parties own in the aggregate at least 50% of the profits, capital, stock, or value of the Taxpayer.
(5) A person to or from whom there is attribution of
stock ownership in accordance with Section 1563(e) of the Internal Revenue Code, except, for purposes of determining whether a person is a Related Member under this paragraph, 20% shall be substituted for 5% wherever 5% appears in Section 1563(e) of the Internal Revenue Code.
"Taxpayer" means an individual, corporation, partnership, or other entity that has any Illinois Income Tax liability. (Source: P.A. 94‑793, eff. 5‑19‑06; 95‑375, eff. 8‑23‑07.)
(35 ILCS 10/5‑10) Sec. 5‑10. Powers of the Department. The Department, in addition to those powers granted under the Civil Administrative Code of Illinois, is granted and shall have all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this Act, including, but not limited to, power and authority to: (a) Promulgate procedures, rules, or regulations deemed necessary and appropriate for the administration of the programs; establish forms for applications, notifications, contracts, or any other agreements; and accept applications at any time during the year. (b) Provide and assist Taxpayers pursuant to the provisions of this Act, and cooperate with Taxpayers that are parties to Agreements to promote, foster, and support economic development, capital investment, and job creation or retention within the State. (c) Enter into agreements and memoranda of understanding for participation of and engage in cooperation with agencies of the federal government, local units of government, universities, research foundations or institutions, regional economic development corporations, or other organizations for the purposes of this Act. (d) Gather information and conduct inquiries, in the manner and by the methods as it deems desirable, including without limitation, gathering information with respect to Applicants for the purpose of making any designations or certifications necessary or desirable or to gather information to assist the Committee with any recommendation or guidance in the furtherance of the purposes of this Act. (e) Establish, negotiate and effectuate any term, agreement or other document with any person, necessary or appropriate to accomplish the purposes of this Act; and to consent, subject to the provisions of any Agreement with another party, to the modification or restructuring of any Agreement to which the Department is a party. (f) Fix, determine, charge, and collect any premiums, fees, charges, costs, and expenses from Applicants, including, without limitation, any application fees, commitment fees, program fees, financing charges, or publication fees as deemed appropriate to pay expenses necessary or incident to the administration, staffing, or operation in connection with the Department's or Committee's activities under this Act, or for preparation, implementation, and enforcement of the terms of the Agreement, or for consultation, advisory and legal fees, and other costs; however, all fees and expenses incident thereto shall be the responsibility of the Applicant. (g) Provide for sufficient personnel to permit administration, staffing, operation, and related support required to adequately discharge its duties and responsibilities described in this Act from funds made available through charges to Applicants or from funds as may be appropriated by the General Assembly for the administration of this Act. (h) Require Applicants, upon written request, to issue any necessary authorization to the appropriate federal, state, or local authority for the release of information concerning a project being considered under the provisions of this Act, with the information requested to include, but not be limited to, financial reports, returns, or records relating to the Taxpayers' or its project. (i) Require that a Taxpayer shall at all times keep proper books of record and account in accordance with generally accepted accounting principles consistently applied, with the books, records, or papers related to the Agreement in the custody or control of the Taxpayer open for reasonable Department inspection and audits, and including, without limitation, the making of copies of the books, records, or papers, and the inspection or appraisal of any of the Taxpayer or project assets. (j) Take whatever actions are necessary or appropriate to protect the State's interest in the event of bankruptcy, default, foreclosure, or noncompliance with the terms and conditions of financial assistance or participation required under this Act, including the power to sell, dispose, lease, or rent, upon terms and conditions determined by the Director to be appropriate, real or personal property that the Department may receive as a result of these actions. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑15) Sec. 5‑15. Tax Credit Awards. Subject to the conditions set forth in this Act, a Taxpayer is entitled to a Credit against or, as described in subsection (g) of this Section, a payment towards taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act that may be imposed on the Taxpayer for a taxable year beginning on or after January 1, 1999, if the Taxpayer is awarded a Credit by the Department under this Act for that taxable year. (a) The Department shall make Credit awards under this Act to foster job creation and retention in Illinois. (b) A person that proposes a project to create new jobs in Illinois must enter into an Agreement with the Department for the Credit under this Act. (c) The Credit shall be claimed for the taxable years specified in the Agreement. (d) The Credit shall not exceed the Incremental Income Tax attributable to the project that is the subject of the Agreement. (e) Nothing herein shall prohibit a Tax Credit Award to an Applicant that uses a PEO if all other award criteria are satisfied. (f) In lieu of the Credit allowed under this Act against the taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act for any taxable year ending on or after December 31, 2009, the Taxpayer may elect to claim the Credit against its obligation to pay over withholding under Section 704A of the Illinois Income Tax Act. (1) The election under this subsection (f) may be
made only by a Taxpayer that (i) is primarily engaged in one of the following business activities: motor vehicle metal stamping, automobile manufacturing, automobile and light duty motor vehicle manufacturing, motor vehicle manufacturing, light truck and utility vehicle manufacturing, heavy duty truck manufacturing, or motor vehicle body manufacturing and (ii) meets the following criteria:
(A) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, (iii) has an Agreement under this Act on December 14, 2009 (the effective date of Public Act 96‑834), and (iv) is in compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or
an Illinois net loss deduction under Section 207 of the Illinois Income Tax Act for the taxable year in which the Credit is awarded, (ii) employed a minimum of 1,000 full‑time employees in this State during the taxable year in which the Credit is awarded, and (iii) has applied for an Agreement within 365 days after December 14, 2009 (the effective date of Public Act 96‑834); or
(C) the Taxpayer (i) had an Illinois net
operating loss carryforward under Section 207 of the Illinois Income Tax Act in a taxable year ending during calendar year 2008, (ii) has applied for an Agreement within 150 days after the effective date of this amendatory Act of the 96th General Assembly, (iii) creates at least 400 new jobs in Illinois, (iv) retains at least 2,000 jobs in Illinois that would have been at risk of relocation out of Illinois over a 10‑year period, and (v) makes a capital investment of at least $75,000,000.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under Section 704A of the Illinois Income Tax Act during the first calendar year beginning after the end of the taxable year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f) elects to claim the Credit against its withholdings as provided in this subsection (f), then, on and after the date of the election, the terms of the Agreement between the Taxpayer and the Department may not be further amended during the term of the Agreement.
(g) A pass‑through entity that has been awarded a credit under this Act, its shareholders, or its partners may treat some or all of the credit awarded pursuant to this Act as a tax payment for purposes of the Illinois Income Tax Act. The term "tax payment" means a payment as described in Article 6 or Article 8 of the Illinois Income Tax Act or a composite payment made by a pass‑through entity on behalf of any of its shareholders or partners to satisfy such shareholders' or partners' taxes imposed pursuant to subsections (a) and (b) of Section 201 of the Illinois Income Tax Act. In no event shall the amount of the award credited pursuant to this Act exceed the Illinois income tax liability of the pass‑through entity or its shareholders or partners for the taxable year. (Source: P.A. 95‑375, eff. 8‑23‑07; 96‑834, eff. 12‑14‑09; 96‑836, eff. 12‑16‑09; 96‑905, eff. 6‑4‑10; 96‑1000, eff. 7‑2‑10.)
(35 ILCS 10/5‑20) Sec. 5‑20. Application for a project to create and retain new jobs. (a) Any Taxpayer proposing a project located or planned to be located in Illinois may request consideration for designation of its project, by formal written letter of request or by formal application to the Department, in which the Applicant states its intent to make at least a specified level of investment and intends to hire or retain a specified number of full‑time employees at a designated location in Illinois. As circumstances require, the Department may require a formal application from an Applicant and a formal letter of request for assistance. (b) In order to qualify for Credits under this Act, an Applicant's project must: (1) involve an investment of at least $5,000,000 in
capital improvements to be placed in service and to employ at least 25 New Employees within the State as a direct result of the project;
(2) involve an investment of at least an amount (to
be expressly specified by the Department and the Committee) in capital improvements to be placed in service and will employ at least an amount (to be expressly specified by the Department and the Committee) of New Employees within the State, provided that the Department and the Committee have determined that the project will provide a substantial economic benefit to the State; or
(3) if the applicant has 100 or fewer employees,
involve an investment of at least $1,000,000 in capital improvements to be placed in service and to employ at least 5 New Employees within the State as a direct result of the project.
(c) After receipt of an application, the Department may enter into an Agreement with the Applicant if the application is accepted in accordance with Section 5‑25. (Source: P.A. 93‑882, eff. 1‑1‑05.)
(35 ILCS 10/5‑25) Sec. 5‑25. Review of Application. (a) In addition to those duties granted under the Illinois Economic Development Board Act, the Illinois Economic Development Board shall form a Business Investment Committee for the purpose of making recommendations for applications. At the request of the Board, the Director of Commerce and Economic Opportunity or his or her designee, the Director of the Governor's Office of Management and Budget or his or her designee, the Director of Revenue or his or her designee, the Director of Employment Security or his or her designee, and an elected official of the affected locality, such as the chair of the county board or the mayor, may serve as members of the Committee to assist with its analysis and deliberations. (b) At the Department's request, the Committee shall convene, make inquiries, and conduct studies in the manner and by the methods as it deems desirable, review information with respect to Applicants, and make recommendations for projects to benefit the State. In making its recommendation that an Applicant's application for Credit should or should not be accepted, which shall occur within a reasonable time frame as determined by the nature of the application, the Committee shall determine that all the following conditions exist: (1) The Applicant's project intends, as required by
subsection (b) of Section 5‑20 to make the required investment in the State and intends to hire the required number of New Employees in Illinois as a result of that project.
(2) The Applicant's project is economically sound
and will benefit the people of the State of Illinois by increasing opportunities for employment and strengthen the economy of Illinois.
(3) That, if not for the Credit, the project would
not occur in Illinois, which may be demonstrated by any means including, but not limited to, evidence the Applicant has multi‑state location options and could reasonably and efficiently locate outside of the State, or demonstration that at least one other state is being considered for the project, or evidence the receipt of the Credit is a major factor in the Applicant's decision and that without the Credit, the Applicant likely would not create new jobs in Illinois, or demonstration that receiving the Credit is essential to the Applicant's decision to create or retain new jobs in the State.
(4) A cost differential is identified, using best
available data, in the projected costs for the Applicant's project compared to the costs in the competing state, including the impact of the competing state's incentive programs. The competing state's incentive programs shall include state, local, private, and federal funds available.
(5) The political subdivisions affected by the
project have committed local incentives with respect to the project, considering local ability to assist.
(6) Awarding the Credit will result in an overall
positive fiscal impact to the State, as certified by the Committee using the best available data.
(7) The Credit is not prohibited by Section 5‑35 of
this Act.
(Source: P.A. 94‑793, eff. 5‑19‑06.)
(35 ILCS 10/5‑30) Sec. 5‑30. Limitation to amount of costs of specified items. The total amount of the Credit allowed during all tax years may not exceed the aggregate amount of costs incurred by the Taxpayer during all prior tax years for the following items, to the extent provided in the Agreement: (1) capital investment, including, but not limited
to, equipment, buildings, or land;
(2) infrastructure development; (3) debt service, except refinancing of current debt; (4) research and development; (5) job training and education; (6) lease costs; or (7) relocation costs. (Source: P.A. 91‑476, eff. 8‑11‑99.)
(35 ILCS 10/5‑35) Sec. 5‑35. Relocation of jobs in Illinois. A taxpayer is not entitled to claim the credit provided by this Act with respect to any jobs that the taxpayer relocates from one site in Illinois to another site in Illinois. A taxpayer with respect to a qualifying project certified under the Corporate Headquarters Relocation Act, however, is not subject to the requirements of this Section but is nevertheless considered an applicant for purposes of this Act. Moreover, any full‑time employee of an eligible business relocated to Illinois in connection with that qualifying project is deemed to be a new employee for purposes of this Act. Determinations under this Section shall be made by the Department. (Source: P.A. 91‑476, eff. 8‑11‑99; 92‑207, eff. 8‑1‑01.)
(35 ILCS 10/5‑40) Sec. 5‑40. Determination of Amount of the Credit. In determining the amount of the Credit that should be awarded, the Committee shall provide guidance on, and the Department shall take into consideration, the following factors: (1) The number and location of jobs created and
retained in relation to the economy of the county where the projected investment is to occur.
(2) The potential impact on the economy of Illinois. (3) The magnitude of the cost differential between
Illinois and the competing state.
(4) The incremental payroll attributable to the
project.
(5) The capital investment attributable to the
project.
(6) The amount of the average wage and benefits paid
by the Applicant in relation to the wage and benefits of the area of the project.
(7) The costs to Illinois and the affected political
