Bill Text: IL SB2922 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Illinois Income Tax Act. Provides a tax credit for certain developers of single-family residences that incur development costs and that sell or rent qualified residences to individuals who meet certain income thresholds. Sets forth the amount of the credit. Effective immediately.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced) 2024-05-03 - Rule 3-9(a) / Re-referred to Assignments [SB2922 Detail]

Download: Illinois-2023-SB2922-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB2922 Introduced 1/26/2024, by Sen. Michael W. Halpin SYNOPSIS AS INTRODUCED:
35 ILCS 5/241 new
Amends the Illinois Income Tax Act. Provides a tax credit for certain developers of single-family residences that incur development costs and that sell or rent qualified residences to individuals who meet certain income thresholds. Sets forth the amount of the credit. Effective immediately.
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A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Income Tax Act is amended by
adding Section 241 as follows:
(35 ILCS 5/241 new)
Sec. 241. Middle-income Housing Development Tax Credit
Pilot Program.
(a) For taxable years ending on or after December 31, 2024
and ending on or before December 31, 2027, each taxpayer that
is a developer of a qualified residence and that invests up to
$200,000 in development costs associated with the qualified
residence may apply to the Authority for a credit against the
taxes imposed by subsections (a) and (b) of Section 201 in an
amount set forth in subsection (b).
(b) The amount of the credit shall be calculated as
follows:
(1) if the qualified residence is sold or rented to
one or more individuals with a combined household income
that exceeds 80% of the median household income in
Illinois but does not exceed 90% of the median household
income in Illinois, then the credit is equal to 20% of the
development costs associated with the qualified residence

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but not to exceed $40,000 for that qualified residence;
(2) if the qualified residence is sold or rented to
one or more individuals with a combined household income
that exceeds 90% of the median household income in
Illinois but does not exceed 110% of the median household
income in Illinois, then the credit is equal to 15% of the
development costs associated with the qualified residence
but not to exceed $30,000 for that qualified residence;
and
(3) if the qualified residence is sold or rented to
one or more individuals with a combined household income
that exceeds 110% of the median household income in
Illinois but does not exceed 120% of the median household
income in Illinois, then the credit is equal to 20% of the
development costs associated with the qualified residence
but not to exceed $20,000 for that qualified residence.
The Authority shall determine the median household income
in Illinois using data compiled by the United States Census
Bureau. Development costs that are paid for using federal,
State, or local incentives that do not require repayment are
not included as qualifying investments and shall not be
included when calculating the tax credit award amount under
this Section.
(c) The Authority may not issue more than $50,000,000 in
credits under this Section. Of the total credits awarded under
this Section, 35% must be for qualified residences located in

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a county with 100,000 or more residents and 350,000 or fewer
residents. Each qualified residence may qualify for only one
credit during the taxable year in which the residence is first
sold or rented. No taxpayer may receive more than $2,000,000
in credits under this Section for any one project.
(d) In no event shall a credit under this Section reduce
the taxpayer's liability to less than zero. If the amount of
the credit exceeds the tax liability for the year, the excess
may be carried forward and applied to the tax liability of the
5 taxable years following the excess credit year. The tax
credit shall be applied to the earliest year for which there is
a tax liability. If there are credits for more than one year
that are available to offset a liability, the earlier credit
shall be applied first.
(e) If the taxpayer is a partnership or Subchapter S
corporation, the credit is allowed to pass through to the
partners and shareholders as provided in Section 251. Credits
may also be transferred during the 5 taxable years after the
taxable year in which the credit is claimed.
(f) The Authority shall adopt rules to implement and
administer this Section, including rules concerning
applications for the tax credit. A taxpayer claiming a credit
under this Section must maintain and record any information
that the Authority may require regarding the development
project for which the credit is claimed.
(g) As used in this Section:

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"Authority" means the Illinois Housing Development
Authority.
"Developer" includes for-profit and non-profit developers,
as well as land banks.
"Development costs" means any costs associated with the
construction or rehabilitation of a qualified residence.
"Household" means all persons using the qualified
residence as their principal place of residence upon the sale
or lease of the qualified residence by the developer.
"Household income" means the combined federal adjusted
gross income of the members of the household for the taxable
year immediately preceding the year in which the qualified
residence is sold or rented to the members of the household.
"Qualified residence" means a single-family residence that
(i) is new construction or has been rehabilitated with $30,000
or more in rehabilitative development costs incurred by the
taxpayer and (ii) is sold or rented pursuant to a contract with
a term of one year or longer to one or more individuals with a
combined household income that exceeds 80% of the median
household income in Illinois but does not exceed 120% of the
median household income in Illinois. The residence must also
have at least a $1,000 local match investment.