Bill Text: IL SB2490 | 2021-2022 | 102nd General Assembly | Introduced


Bill Title: Amends the Illinois Income Tax Act. Creates an income tax credit for an employer who hires a qualified employee to work at a location in the State. Sets forth the amount of the credit. Provides that the credit shall be increased if (i) the qualified employee is hired to work at a location in a disproportionately impacted area or (ii) on the date the qualified employee is hired, the qualified employee resides in a disproportionately impacted area. Limits the total amount of income tax credits that the Department of Commerce and Economic Opportunity may issue over the duration of the program. Provides that the term "qualified employee" means a resident of the State who is hired by the taxpayer to fill a full-time net new job and was unemployed as a result of COVID-19 prior to the date he or she was hired by the taxpayer. Provides that the term "qualified employee" does not include an individual who was furloughed by the taxpayer. Effective immediately.

Spectrum: Slight Partisan Bill (Democrat 7-3)

Status: (Introduced) 2022-02-10 - Rule 3-9(a) / Re-referred to Assignments [SB2490 Detail]

Download: Illinois-2021-SB2490-Introduced.html


102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB2490

Introduced 2/26/2021, by Sen. Ram Villivalam

SYNOPSIS AS INTRODUCED:
35 ILCS 5/232 new

Amends the Illinois Income Tax Act. Creates an income tax credit for an employer who hires a qualified employee to work at a location in the State. Sets forth the amount of the credit. Provides that the credit shall be increased if (i) the qualified employee is hired to work at a location in a disproportionately impacted area or (ii) on the date the qualified employee is hired, the qualified employee resides in a disproportionately impacted area. Limits the total amount of income tax credits that the Department of Commerce and Economic Opportunity may issue over the duration of the program. Provides that the term "qualified employee" means a resident of the State who is hired by the taxpayer to fill a full-time net new job and was unemployed as a result of COVID-19 prior to the date he or she was hired by the taxpayer. Provides that the term "qualified employee" does not include an individual who was furloughed by the taxpayer. Effective immediately.
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FISCAL NOTE ACT MAY APPLY

A BILL FOR

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1 AN ACT concerning revenue.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. The Illinois Income Tax Act is amended by
5adding Section 232 as follows:
6 (35 ILCS 5/232 new)
7 Sec. 232. Employment credit; COVID-19.
8 (a) For taxable years that begin on or after January 1,
92021 and begin prior to January 1, 2026, for the purpose of
10training and hiring qualified employees, each employer that
11employs an average of 500 or fewer employees during the
12taxable year is entitled to a credit against the taxes imposed
13by subsections (a) and (b) of Section 201 for each qualified
14employee hired by the employer during the taxable year to work
15at a location in the State. If the taxpayer employs an average
16of 500 or fewer employees, but more than 100 employees, during
17the taxable year, then the amount of the credit shall be $2,500
18per qualified employee. If the taxpayer employs an average of
19100 or fewer employees during the taxable year, then the
20amount of the credit shall be $5,000 per qualified employee.
21The credit amounts set forth in this subsection (a) shall be
22increased by $1,500 if (i) the qualified employee is hired to
23work at a location in a disproportionately impacted area, or

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1(ii) on the date the qualified employee is hired, the
2qualified employee resides in a disproportionately impacted
3area; if the employee meets both items (i) and (ii), the
4employer shall be eligible for only a single $1,500 increase.
5The Department of Commerce and Economic Opportunity shall
6issue a tax credit certificate to taxpayers who qualify for a
7credit under this Section. The taxpayer must attach the
8certificate to the tax return on which the credits are to be
9claimed. In no event may the Department of Commerce and
10Economic Opportunity issue more than $100,000,000 in credits
11under this Section for the duration of the program.
12 (b) For partners, shareholders of subchapter S
13corporations, and members of limited liability companies, if
14the limited liability company is treated as a partnership for
15purposes of federal and State income taxation, there shall be
16allowed a credit under this Section to be determined in
17accordance with the determination of income and distributive
18share of income under Sections 702 and 704 and subchapter S of
19the Internal Revenue Code.
20 (c) The credit or credits may not reduce the taxpayer's
21liability to less than zero. If the amount of the credit or
22credits exceeds the taxpayer's liability, the excess may be
23carried forward and applied against the taxpayer's liability
24for up to 5 succeeding taxable years. The credit or credits
25shall be applied to the earliest year for which there is a tax
26liability. If there are credits from more than one taxable

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1year that are available to offset a liability, the earlier
2credit shall be applied first.
3 (d) As used in this Section:
4 "Disproportionately impacted area" means a geographic
5 area designated by the Department of Commerce and Economic
6 Opportunity as meeting at least one of the following
7 criteria:
8 (A) the area has a poverty rate of at least 20%
9 according to the latest federal decennial census;
10 (B) 75% or more of the children in the area
11 participate in the federal free lunch program
12 according to reported statistics from the State Board
13 of Education;
14 (C) at least 20% of the households in the area
15 receive assistance under the Supplemental Nutrition
16 Assistance Program; or
17 (D) the area has an average unemployment rate, as
18 certified by the Department of Employment Security,
19 that is more than 120% of the national unemployment
20 average, as determined by the United States Department
21 of Labor, for a period of at least 2 consecutive
22 calendar years preceding the date of the designation.
23 "Full-time equivalent employment position" means a job
24 in which the employee works for the taxpayer at a rate of
25 at least 30 hours per week. Vacations, paid holidays, and
26 sick time are included in this computation.

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1 "Net new job" means a full-time equivalent employment
2 position that causes the taxpayer's average employee head
3 count in the State for the calendar year in which the
4 taxable year begins to exceed its employee head count in
5 the State on the effective date of this amendatory Act of
6 the 102nd General Assembly.
7 "Qualified employee" means a resident of the State who
8 is hired by the taxpayer to fill a net new job and was
9 unemployed as a result of COVID-19 prior to the date he or
10 she was hired by the taxpayer. The term "qualified
11 employee" includes, but is not limited to, a resident who
12 was self-employed but became unemployed because of
13 COVID-19. The term "qualified employee" does not include
14 an employee who was furloughed by the taxpayer and
15 reinstated during the taxable year.
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