Bill Text: IL SB3786 | 2019-2020 | 101st General Assembly | Introduced

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Bill Title: Creates the Recovery and Mental Health Tax Credit Act. Provides that the Department of Human Services shall establish and administer a recovery tax credit program to provide tax incentives to qualified employers who employ eligible individuals in recovery from a substance use disorder or mental illness in part-time and full-time positions within Illinois. Creates the Advisory Council on Mental Illness and Substance Use Disorder Impacts on Employment Opportunities within Minority Communities. Sets forth the membership of the Council. Provides that the Council shall advise the Department of Human Services regarding employment of persons with mental illnesses and substance use disorders in minority communities. Amends the Illinois Income Tax Act to make conforming changes.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2021-01-13 - Session Sine Die [SB3786 Detail]

Download: Illinois-2019-SB3786-Introduced.html

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101ST GENERAL ASSEMBLY State of Illinois 2019 and 2020 SB3786 Introduced 2/14/2020, by Sen. Mattie Hunter SYNOPSIS AS INTRODUCED:
New Act
35 ILCS 5/232 new
Creates the Recovery and Mental Health Tax Credit Act. Provides that the Department of Human Services shall establish and administer a recovery tax credit program to provide tax incentives to qualified employers who employ eligible individuals in recovery from a substance use disorder or mental illness in part-time and full-time positions within Illinois. Creates the Advisory Council on Mental Illness and Substance Use Disorder Impacts on Employment Opportunities within Minority Communities. Sets forth the membership of the Council. Provides that the Council shall advise the Department of Human Services regarding employment of persons with mental illnesses and substance use disorders in minority communities. Amends the Illinois Income Tax Act to make conforming changes.
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FISCAL NOTE ACT MAY APPLY
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 1. Short title. This Act may be cited as the
Recovery and Mental Health Tax Credit Act.
Section 5. Findings.
(a) In the interest of reducing stigma, the General
Assembly finds and declares that those residents of Illinois
diagnosed with mental illness and substance use disorders
should be eligible for and encouraged to seek gainful
employment.
(b) The General Assembly finds and declares that minority
communities in the State have been more negatively impacted in
employment opportunities for minority residents diagnosed with
mental illness and substance use disorders and should receive
additional employment opportunities and incentives for
employing minority residents diagnosed with mental illness or
substance use disorders.
(c) In the interest of providing additional employment
opportunities for those residents of Illinois diagnosed with
mental illness or substance use disorders, the General Assembly
finds and declares that certain qualified employers who employ
eligible individuals should be eligible for a tax credit.

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Section 10. Definitions. As used in this Act:
"Department" means the Department of Human Services.
"Eligible individual" means an individual with a substance
use disorder, as that term is defined under Section 1-10 of the
Substance Use Disorder Act, or an individual with a mental
illness as that term is defined under Section 1-129 of the
Mental Health and Developmental Disabilities Code, who is in a
state of wellness and recovery where there is an abatement of
signs and symptoms that characterize active substance use
disorder or mental illness and has demonstrated to the
qualified employer's satisfaction, pursuant to regulations
promulgated by the Department, that he or she has completed a
course of treatment or is currently in receipt of treatment for
such substance use disorder or mental illness. A relapse in an
individual's state of wellness shall not make the individual
ineligible, so long as the individual shows a continued
commitment to recovery that aligns with an individual's relapse
prevention plan discharge plan or recovery plan.
"Qualified employer" means an employer operating within
the State that has received a certificate of tax credit from
the Department after the Department has determined that the
employer:
(1) provides a recovery supportive environment for
their employees evidenced by a formal working relationship
with a substance use disorder treatment provider or

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facility or mental health provider or facility, each as may
be licensed or certified within the State of Illinois, and
providing reasonable accommodation to the employees to
address their substance use disorder or mental illness, all
at no cost or expense to the eligible individual; and
(2) satisfies all other criteria in this Section and
established by the Department to participate in the
recovery tax program created hereunder.
"Taxpayer" means any individual, corporation, partnership,
trust, or other entity subject to the Illinois income tax. For
the purposes of this Act, 2 individuals filing a joint return
shall be considered one taxpayer.
Section 15. Authorization of tax credit program for
individuals in recovery from substance use disorders or mental
illness.
(a) For taxable years beginning on or after January 1,
2021, the Department is authorized to and shall establish and
administer a recovery tax credit program to provide tax
incentives to qualified employers who employ eligible
individuals in recovery from a substance use disorder or mental
illness in part-time and full-time positions within Illinois.
The Department shall award the tax credit by issuance of a
certificate of tax credit to the qualified employer, who will
present the certificate of tax credit to the Department of
Revenue as a credit against the qualified employer's tax

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obligation in accordance with this Act.
(b) To be a qualified employer, an employer must apply
annually to the Department to claim a credit based upon
eligible individuals employed during the preceding calendar
year, using the forms prescribed by the Department. To be
approved for a credit under this Act, the employer must:
(1) agree to provide to the Department the information
necessary to demonstrate that the employer has satisfied
program eligibility requirements and provided all
information requested or needed by the Department,
including the number of hours worked by the eligible
individual and other information necessary for the
Department to calculate the amount of credit permitted; and
(2) agree to provide names, employer identification
numbers, amounts that the employer may claim, and other
information necessary for the Department to calculate any
tax credit.
(c) To be an eligible individual, the individual must be
diagnosed with or have been diagnosed with a substance use
disorder or mental illness. Disclosure by the eligible
individual of his or her mental illness or substance use
disorder shall be completely voluntary and his or her health
information may not be shared or disclosed under this Act
without the eligible individual's express written consent. The
eligible individual must have been employed by the qualified
employer in the State for a minimum of 500 hours during the

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applicable calendar year and the tax credit may only begin on
the date the eligible individual is hired by the qualified
employer and ending on December 31 of that calendar year or the
date that the eligible individual's employment with the
qualified employer ends, whichever occurs first. Only one tax
credit may be awarded for any eligible individual while
employed by the same or related qualified employer. The hours
of employment of 2 or more eligible individuals may not be
aggregated to reach the minimum number of hours. If an eligible
individual has worked in excess of 500 hours between the date
of hiring and December 31 of that year, a qualified employer
can elect to compute and claim a credit for such eligible
individual in that year based on the hours worked by December
31. Alternatively, the qualified employer may elect to include
such individual in the computation of the credit in the year
immediately succeeding the year in which the eligible
individual was hired. In that case, the credit shall be
computed on the basis of all hours worked by the eligible
individual from the date of hire to the earlier of the last day
of employment or December 31 of the succeeding year.
(d) The aggregate amount of all credits the Department may
award under this Act in any calendar year may not exceed
$2,000,000.
(e) If the qualified employer's taxable year is a calendar
year, the employer shall be entitled to claim the credit as
shown on the certificate of tax credit on the calendar year

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return for which the certificate of tax credit was issued. If
the certified employer's taxable year is a fiscal year, the
qualified employer shall be entitled to claim the credit as
shown on the certificate of tax credit on the return for the
fiscal year that includes the last day of the calendar year
covered by the certificate of tax credit.
(f) If Department criteria and all other requirements are
met, a qualified employer shall be entitled to a tax credit
equal to the product of $1 and the number of hours worked by
each eligible individual during the eligible individual's
period of employment with the qualified employer. The tax
credit awarded hereunder may not exceed $2,000 per eligible
individual employed by the qualified employer in the State. In
determining the amount of tax credit that any qualified
employer may claim, the Department shall review all claims
submitted for credit by all employers and, to the extent that
the total amount claimed by employers exceeds the amount
allocated for this program in that calendar year, shall issue
tax credits on a pro-rata basis corresponding to each qualified
employer's share of the total amount claimed.
(g) No credit shall be taken under this Act if the taxpayer
claims a federal income tax deduction for the employment of the
eligible individual by a qualified employer.
(h) No tax credit awarded under this Act may reduce a
qualified employer's tax obligation to less than zero.
(i) The Department of Revenue shall review and accept the

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tax credit certificates issued by the Department and apply the
tax credit towards the qualified employer's income tax
obligation. A taxpayer that is a qualified employer that has
received a certificate of tax credit from the Department shall
be allowed a credit against the tax imposed equal to the amount
shown on such certificate of tax credit. If the taxpayer is (i)
a corporation having an election in effect under Subchapter S
of the federal Internal Revenue Code, (ii) a partnership, or
(iii) a limited liability company, the credit provided under
this Act may be claimed by the shareholders of the corporation,
the partners of the partnership, or the members of the limited
liability company in the same manner as those shareholders,
partners, or members account for their proportionate shares of
the income or losses of the corporation, partnership, or
limited liability company, or as provided in the bylaws or
other executed agreement of the corporation, partnership, or
limited liability company. In carrying out this Act, no
patient-specific information shall be shared or disclosed. Any
information collected by the Department or the Department of
Revenue shall not be subject to public disclosure or Freedom of
Information Act requests.
(j) The credit under this Act is exempt from the provisions
of Section 250 of the Illinois Income Tax Act.
Section 20. Advisory Council on Mental Illness and
Substance Use Disorder Impacts on Employment Opportunities

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within Minority Communities. The Secretary of the Department
shall appoint the Advisory Council on Mental Illness and
Substance Use Disorder Impacts on Employment Opportunities
within Minority Communities, to be composed of 15 members,
which shall include a balanced representation of recipients,
services providers, employers, local governmental units,
community and welfare advocacy groups, academia, and the
general public. The Advisory Council shall advise the
Department regarding all aspects of employment impacts
resulting from mental illnesses and substance use disorders
within minority communities, tax credits, outreach, marketing,
and education about the tax credit and employment
opportunities, and other areas as deemed appropriate by the
Secretary. In appointing the first Council, the Secretary shall
name 8 members to 2-year terms and 7 members to serve 4-year
terms, all of whom shall be appointed within 6 months of the
effective date of this Act. All members appointed thereafter
shall serve 4 year terms. Members shall serve without
compensation other than reimbursement of expenses actually
incurred in the performance of their official duties. At its
first meeting, the Advisory Council shall select a chair from
among its members. The Advisory Council shall meet at least
quarterly and at other times at the call of the chair.
Section 25. Powers. The Department shall adopt rules for
the administration of this Act. The Department may enter into

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an intergovernmental agreement with the Department of Revenue
for the administration of this Act.
Section 90. The Illinois Income Tax Act is amended by
adding Section 232 as follows:
(35 ILCS 5/232 new)
Sec. 232. Recovery and Mental Health Tax Credit Act. A
taxpayer who has been awarded a credit under the Recovery and
Mental Health Tax Credit Act is entitled to a credit against
the tax imposed by subsections (a) and (b) of Section 201 as
provided in that Act. This Section is exempt from the
provisions of Section 250.