HB4482 93RD GENERAL ASSEMBLY

LRB093 20114 SJM 45859 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB4482

Introduced 02/03/04, by Calvin L. Giles

SYNOPSIS AS INTRODUCED:

35 ILCS 5/220 new

Amends the Illinois Income Tax Act. Provides that for each taxable year beginning on or after January 1, 2005, a taxpayer employer is allowed an income tax credit in the amount of $1,200 or 5% of the salary paid to the employee during the taxable year, whichever is less, for each eligible ex-felon employed by the taxpayer as of the last day of the taxable year. Sets forth the standards for an employee to be an "eligible ex-felon". Provides that unused amounts of the credit may be carried forward for a period of 5 years. Exempts the credit from the sunset requirements of the Act. Requires the Department of Revenue and the Department of Corrections to adopt rules concerning the credit.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning taxes.

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 220 as follows:

(35 ILCS 5/220 new)

Sec. 220. Ex-felon employee credit.

(a) For each taxable year beginning on or after January 1, 2005, a taxpayer employer is allowed a credit against the tax imposed by subsections (a) and (b) of Section 201 of this Act for employing an eligible ex-felon. The amount of the credit is $1,200 or 5% of the salary paid to the employee during the taxable year, whichever is less, for each eligible ex-felon employed by the taxpayer as of the last day of the taxable year.

(b) An employee is an "eligible ex-felon" only if all of the following criteria are met:

(1) The Illinois Department of Corrections and the Department of Revenue have certified the employee as:

(A) having been convicted of a felony under any statute of the United States or of the State;

(B) having a hiring date that is not more than 1 year after the date on which the employee was convicted or released from prison, whichever is later; and

(C) being a member of a family that had an income during the 6 months immediately preceding the earlier of the month in which the income determination occurs or the month in which the hiring date occurs, which, on an annual basis, would be 70% or less of the Bureau of Labor Statistics lower living standard; and

(2) The employee is a full-time employee working 30 or more hours per week for 26 consecutive weeks; provided, however, that the 26-week period may be completed after the end of the taxable year for which the credit under this Section is claimed.

(c) For partners, shareholders of subchapter S corporations, and owners of limited liability companies, if the limited liability company is treated as a partnership for purposes of federal and State income taxation, there shall be allowed a credit under this Section to be determined in accordance with the determination of income and distributive share if income under Sections 702 and 702 of the federal Internal Revenue Code of 1986.

(d) Any credit allowed under this Section that is unused in the year the credit is earned may be carried forward to each of the 5 taxable years following the year for which the credit is first computed until it is used. This credit shall be applied first to the earliest year for which there is a liability. If there is a credit under this Section form more than one tax year that is available to offset a liability, then the earliest credit arising under this Section shall be applied first.

(e) This Section is exempt from the provisions of Section 250 of this Act.

(f) The Department of Revenue and the Department of Corrections must adopt any rules that are necessary to carry out the purposes of this Section.