The House will return to Springfield on February 10. The plan is that the House will return on February 10 to vote on a proposal that will allow for some remote activities. It appears that the members will be asked to adopt a proposal that will authorize committee hearings to be held remotely.

The Senate cancelled this week's session days. The Senate is was scheduled to return to Springfield on February 9.. However, this week the Senate cancelled all February session days. It was announced that Senate committees will meet virtually during February.

Senate committee assignments have been announced. Here is a link to the members of the Senate Revenue committee. It is unclear as of today who will be the Chair of the Senate Revenue committee. Senator Steans was announced as Chair, but she is in the process of resigning from the Senate. Senator Don DeWitte has been named the Republican Spokesperson on the committee.

Speaker Welch announced House committee Chairs. Representative Zalewski will return as the Chairman of the House Revenue committee. Representative Steve Reick has been named the Republican spokesperson on the House Revenue committee. As of this morning, the full committee membership roster has not been posted.

The flood of new legislation has begun. As I have done in the past, I will list every tax-related bill that is introduced with the exception of TIF extensions and proposed income tax checkoffs. Most of these bills won't end up going anywhere, but at this stage we don't know which bills will get traction and which will not.

HB 368 - Andrade - I've been advised by the Department of Revenue Acting General Counsel that the Auditor General seeks this legislation. I am advised that under existing law, the Auditor General may not be authorized to review Department of Revenue audit files as a portion of the Auditor General's programmatic audits of the Department of RevenueAmends the Illinois State Auditing Act.

HB 373 - Didech - Amends the Property Tax Code. Makes changes concerning the alternate valuation applied to property containing a solar energy system. Provides that, beginning in assessment year 2021, the alternate valuation shall be the lesser of the value of the property without the solar energy system or the value of the property with the solar energy system. Provides that the owner of the property is not required to file an application for this alternate valuation.

HB 380 - Greenwood - Amends the Illinois Municipal Code. Removes a requirement that the imposition of certain non-home rule use and occupation taxes is subject to referendum approval. Effective immediately.

HB 391 - Moylan - Amends the Illinois Income Tax Act. Creates an income tax credit for taxpayers who employ individuals working within the engineering sector who graduated from an accredited institution of higher learning with a Bachelor's degree or higher. Provides that the credit shall be equal to 10% of the compensation paid for the first through fifth years of employment in the engineering sector if the qualified employee graduated from an institution located in Illinois or 5% of the compensation paid for the first through fifth years of employment in the engineering sector if the qualified employee graduated from an institution not located in Illinois. Effective immediately.

HB 392 - Moylan - Amends the Illinois Income Tax Act. Provides that a taxpayer shall be allowed an income tax credit in an amount equal to 1.3% of the qualified research expenses made by the taxpayer in Illinois. Provides that the taxpayer is not required to have obtained a research and development credit with respect to his or her federal income taxes to qualify for the Illinois research and development credit.

HB 393 - Moylan - Amends the Illinois Income Tax Act. Creates an income tax credit in an amount equal to the amount paid by the taxpayer during the taxable year for the purpose of purchasing acoustical materials, other materials, labor, and professional services to soundproof a residential home located at an eligible address against aircraft noise generated by an airport governed by the provisions of the Permanent Noise Monitoring Act. Provides that the credit may not reduce the taxpayer's liability to less than zero; however, the credit may be carried forward. Provides that the credit is exempt from the Act's automatic sunset provisions. Effective immediately.

HB 403 - Greenwood - Amends the Property Tax Code. With respect to the Senior Citizens Assessment Freeze Homestead Exemption, provides that, beginning in assessment year 2021, the taxpayer's household income shall be reduced by any amounts paid as Medicare premiums. Effective immediately.

HB 421 - Mason - Amends the Illinois Income Tax Act. Creates an income tax credit for taxpayers that own and operate a sanitary landfill in the State and incur noise mitigation costs during the taxable year in connection with that sanitary landfill. Provides that the taxpayer shall apply to the Illinois Environmental Protection Agency for the credit. Provides that the amount of the credit may not exceed 5% of the costs incurred during the taxable year for labor and materials in connection with those noise mitigation measures.

HB 424 - Carroll - Amends the Retailers' Occupation Tax Act. Provides that a teacher who is employed by an educational institution that is exempt from the tax under the Act is presumed to be making an exempt purchase if he or she (i) purchases materials and supplies, (ii) possesses a copy of the educational institution's exemption number, and (iii) presents identification at the time of the sale.

Staats note: I'm not sure that this legislation is necessary. A teacher should already be authorized to utilize a school's exemption identification number to make purchases utilized in classrooms for school purposes. It is also my understanding that the Department of Revenue is working on an administrative solution to this issue.

HB 427 - Walker - Amends the Property Tax Code. Provides that the election authority for Lake County shall cause to be submitted to the voters of Lake County at the first general election held after the effective date of the amendatory Act a referendum to convert the Office of the Chief Assessment Officer of Lake County to an elected office rather than an appointed office. Provides for the form of the referendum to be submitted. Provides that in the event that a majority of the electors voting on the referendum are in favor thereof, the Office of the Chief Assessment Officer of Lake County shall become an elected office. Provides requirements for the candidacy, election, and assumption of office of a Chief Assessment Officer of Lake County. Amends the Election Code to allow for the submission of a referendum regarding the Office of the Chief Assessment Officer of Lake County. Effective immediately.

HB 430 - Marron - Amends the Property Tax Code. Provides that, if a veteran with a surviving spouse was in the process of review to receive the homestead exemption for veterans with disabilities, but the veteran died before the exemption was approved, then the application process shall continue and any subsequent approval granted to the veteran shall carry over to the spouse as long as the spouse meets the requirements for carry over. Effective immediately.

HB 435 - Walker - Amends the Economic Development for a Growing Economy Tax Credit Act. Provides that the recipient of a credit under the Act may apply for a certificate of transferability of credit from the Department of Commerce and Economic Opportunity for the amount of the credit not previously claimed. Provides that the transferability certificate may be transferred or sold by the recipient to another Illinois taxpayer. Makes other changes.

Staats note: We support making EDGE credits transferrable.

HB 436 - Walker - Amends the Property Tax Extension Limitation Law in the Property Tax Code. Provides that, for levy year 2021 and thereafter, the limiting rate shall include 50% of the value of new property (currently, 100% of the value of new property is excluded). Effective immediately.

HB 437 - Walker - Amends the Illinois Income Tax Act. Provides that a taxpayer who (i) has an associate's degree, a bachelor's degree, or a graduate degree from an institution of higher education accredited by the U.S. Department of Education, (ii) has annual student loan repayment expenses, and (iii) is employed full-time in the State, or has an offer of full-time employment in the State, in one or more of the specified science and technology fields is eligible for an income tax credit equal to the taxpayer's student loan repayment expenses for the taxable year, but not to exceed a maximum credit limit. Effective immediately.

HB 438 - West - Amends the State Finance Act to create the Mental Health Services Fund as a special fund in the State treasury. Provides that moneys in the Mental Health Services Fund shall be distributed each month to the counties of the State for certain specified purposes. Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Imposes a surcharge of 1% of the selling price on firearm ammunition. Provides that moneys from the surcharge shall be deposited into the Mental Health Services Fund. Effective immediately.

HB 445 - Walker - Amends the Illinois Income Tax Act. In a Section concerning the angel investment credit, provides that: (1) the Department of Commerce and Economic Opportunity may charge an application fee of $500; (2) increases the maximum credit amount that may be awarded from $10,000,000 to $20,000,000; (3) of the maximum credit amount that may be awarded, $10,000,000 shall be reserved for priority industries; (4) the term "priority industry" means an industry determined by the Department to have high potential for growth; (5) a person may be considered a "related member" if the person has at least a 33% ownership interest in the qualified new business venture (currently, 50%); (6) an investment that is part of a refinancing of a prior investment in a qualified new business venture is not eligible for the credit; and (7) if the investment is made in a disenfranchised community business, the amount of the credit shall be equal to 40% (currently, 25%) of the claimant's investment. Defines terms.

SB 448 - Walker - Amends the Property Tax Extension Limitation Law in the Property Tax Code. Provides that, for levy years 2021 and later, the taxing district's aggregate extension base is the greater of (A) the district's last preceding aggregate extension limit or (B) the district's last preceding aggregate extension, subject to certain adjustments. Provides that the term "aggregate extension limit" means the district's last preceding aggregate extension if the taxing district had utilized the maximum limiting rate permitted without referendum for each of the 5 immediately preceding levy years. Effective immediately.

HB 453 - Davis - Amends the Property Tax Code. Provides that any taxing district that has an aggregate property tax levy of more than $5,000,000 for the applicable levy year shall make a good faith effort to collect and electronically publish data from all vendors and subcontractors doing business with the taxing district as to whether the vendor or subcontractor is a minority-owned, women-owned, or veteran-owned business or whether the vendor or subcontractor is a small business. Preempts the concurrent exercise of home rule powers. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

HB 567 - Yingling - Amends the Property Tax Code. Provides that, prior to the initial sale of any platted lot, the assessed valuation of platted and subdivided property shall be the assessed value assigned to the property when last assessed prior to its last transfer or conveyance (currently, the estimated price the property would bring at a fair voluntary sale for use by the buyer for the same purposes for which the property was used when last assessed prior to its platting). Provides that the changes made by the amendatory Act apply from January 1, 2019 through December 31, 2023. Makes other changes. Effective immediately.

HB 569 - Carroll - Amends the Illinois Income Tax Act. Makes changes to the definition of investment partnership to provide that a dealer in qualifying investment securities may be considered an investment partnership. Allows a partnership interest to be considered a qualified security if the interest qualifies as a security within the meaning of Section 2(a)(1) of the federal Securities Act of 1933. Effective immediately.

HB 570 - Carroll - This bill is an Illinois Chamber Tax Institute initiative. Amends the Tobacco Products Tax Act of 1995. Provides that, beginning on January 1, 2022, the tax per cigar or other rolled tobacco product shall not exceed $0.50 per cigar or roll. Provides that distributors are allowed a discount in the amount of 2% of the distributor's tax liability, but not to exceed $2,000 per return.

HB 571 - Carroll - Amends the Illinois Municipal Code. Provides that a municipality reporting Tax Increment Financing information shall additionally report to the Comptroller: (1) the number of jobs, aspirational or otherwise, if any, projected to be created for each redevelopment project area at the time of approval of the redevelopment agreement; (2) the number of jobs, if any, created as a result of the development under the same guidelines and assumptions as was used for the projections used at the time of approval of the redevelopment agreement to date for that reporting period; (3) the amount of increment projected to be created at the time of approval of the redevelopment agreement for each redevelopment project area; (4) the amount of increment created as a result of the development to date for that reporting period using the same assumptions as was used for the projections used at the time of approval of the redevelopment agreement; and (5) the stated rate of return identified by the developer to the municipality for each redevelopment project area, if any. In provisions requiring a municipality to report an analysis prepared by a financial advisor or underwriter, provides that the advisor or underwriter shall be chosen by the municipality and that analysis shall additionally include actual debt service.

HB 575 - Vella - Amends the Property Tax Code. In a Section regarding property tax exemptions for charitable purposes, provides that property held by a charitable organization for the purpose of constructing or rehabilitating residences for eventual transfer to qualified low-income families through sale, lease, or contract for deed is exempt from property tax as a charitable purpose. Provides that the exemption commences on the day title to the property is transferred to the organization and continues to the end of the levy year in which the organization transfers title to the property to a qualified low-income family. Effective immediately.

Staats note: This appears to me to be unconstitutional as it goes beyond the scope of the charitable exemption in the constitution.

HB 578 Walker - Amends the Property Tax Extension Limitation Law in the Property Tax Code. Provides that a taxing district shall increase or reduce its aggregate extension base for the purpose of raising or lowering its limiting rate for future years upon referendum approval initiated by the submission of a petition by the voters of the district. Effective immediately.

HB 583 - Stuart - Amends the Illinois Income Tax Act. Creates an income tax credit for taxpayers who are caregivers of a veteran with a disability. Provides that the credit shall be in an amount equal to 5% of the costs incurred in caring for the veteran, not to exceed $1,000 in credits in any taxable year. Effective immediately.

HB 596 - Meier - Amends the Property Tax Code. Creates a landlord pandemic relief exemption. Provides that property is entitled to the exemption if: (1) the property is an income-producing property owned by a qualified property owner; (2) the property was subject to Executive Order 2020-10 and each subsequent Executive Order issued by the Governor regarding ceasing eviction proceedings due to the COVID-19 pandemic; (3) the qualified property owner can demonstrate a financial burden due to the eviction moratorium; (4) the qualified property owner is liable for paying the real estate taxes on the property; and (5) the qualified property owner is an owner of record of the property or have a legal or equitable interest in the property, as evidenced by a written instrument. Provides that the exemption may not exceed $10,000 per property. Effective immediately.

Staats note: This seems to go beyond the scope of allowable property tax exemptions under the Illinois Constitution.

HB 603 - Stuart - Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, from August 1, 2021 through August 7, 2021, the tax imposed under the Acts on clothing and school supplies shall be at the rate of 1.25% (instead of 6.25%). Makes changes concerning the distribution of proceeds from those sales. Makes corresponding changes in the State Finance Act. Effective immediately.

HB 606 - Vella - Creates the Jobs Creation Finance Act. Provides that municipalities may designate job creation areas. Provides that businesses that undertake job creation projects in those designated areas are eligible for certain tax incentives. Provides that municipalities may issue bonds in connection with those projects. Contains provisions concerning public hearings. Contains numerous other provisions. Effective immediately.

HB 617 - Jones - Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois. Provides that the Department of Commerce and Economic Opportunity shall design and implement the New Remote Worker Grant Program. Provides for the awarding of grants under the Program. Specifies the amounts that may be awarded under the Program. Provides for the adoption of rules. Defines terms. Effective immediately.

HB 621 - Stuart - Amends the Illinois Income Tax Act. Provides that the credit for wages paid to qualified veterans also extends to wages paid to a qualified veteran's spouse. Provides that active duty member of the United States Armed Forces are also considered "qualified veterans". Effective immediately.

HB 623 - Wheeler - Amends the Illinois Enterprise Zone Act. Provides that certain businesses that are engaged in manufacturing, processing, assembling, warehousing, or distributing products may be certified as high impact businesses. Amends the Illinois Income Tax Act and the Public Utilities Act to make conforming changes. Effective immediately.

HB 630 - Reick - Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois, the Illinois Income Tax Act, and the Economic Development for a Growing Economy Tax Credit Act. Provides that the Department of Commerce and Economic Opportunity, in cooperation with the Department of Revenue, may adopt rules to identify and allow for the extension of credits under the Economic Development for a Growing Economy Tax Credit Act that are set to expire during a tax year during which there is a statewide COVID-19 public health emergency as evidenced by an effective disaster declaration of the Governor covering all counties.

HB 636 - Bourne - Amends the Illinois Vehicle Code. Reduces the trailer flat weight tax for maximum loads of 3,000 pounds and less from $118 to $18. Effective immediately.

SB 51 - Crowe - Amends the Property Tax Code. Provides that a county may, by ordinance, enact a law enforcement officer's homestead exemption in the amount of $1,500 to be deducted from the value of qualified property that is the primary residence of an eligible law enforcement officer. Effective June 1, 2021.

SB 58 - Munoz - Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, beginning 120 days after the effective date of the amendatory Act, the term "selling price" no longer includes the value of traded-in motor vehicles. Amends the Illinois Vehicle Code. In a Section concerning the use tax on motor vehicles, makes changes concerning the amount of the tax. Provides that the tax on motorcycles, motor driven cycles, and mopeds shall be the same as for all other motor vehicles. Effective immediately.

SB 62 - Martwick - Amends the Revised Uniform Unclaimed Property Act. Provides that an apparent owner's interest in property includes a deposit into or withdrawal from an account at a financial organization, including (rather than except for) a recurring Automated Clearing House debit or credit previously authorized by the apparent owner, except for (rather than or) an automatic reinvestment of dividends or interest.

SB 82 - Stoller - Amends the Property Tax Code. Provides that the abatement for property located in an area of urban decay also applies to newly remodeled single-family or duplex residential dwelling units (currently, only newly constructed single-family or duplex dwelling units). Provides that provisions requiring the abatement to be reduced in 20% increments annually during the last 4 years of the abatement period apply only to abatements granted prior to the effective date.

SB 83 - Stoller - Amends the Property Tax Code. Creates the Site Value Tax Law within the Property Tax Code. Provides that each taxing district may, by ordinance, levy a site value tax upon the assessed value of land within the taxing district. Provides that "assessed value" means 33 1/3% of the fair cash value of the land, without regard to buildings, structures, improvements, or other permanent fixtures on the land, except for the value of oil, gas, coal, and other minerals in the land and the right to remove such oil, gas, coal, and other minerals from the land. Contains provisions concerning enforcement and collection. Effective immediately.

SB 88 - Stoller - Amends the Tax Increment Allocation Redevelopment Act in the Illinois Municipal Code. Provides that any ordinance adopting tax increment financing on or after the effective date of the amendatory Act shall specify a date for the dissolution of the special tax allocation fund and a date for the termination of the designation of the redevelopment project area. Provides that, within 90 days after the effective date of the amendatory Act, each municipality shall amend all existing tax increment financing ordinances to specify a date for the dissolution of the special tax allocation fund and a date for termination of the designation of the redevelopment project area. Provides that municipalities shall notify affected taxing districts of the termination of redevelopment project areas by July 1 (currently, November 1) of the calendar year in which the redevelopment project area is terminated. Amends the Property Tax Extension Limitation Law in the Property Tax Code. Provides that, if a municipality has failed to provide timely notice to all taxing bodies of the termination of a redevelopment project area and the county clerk has been notified of that failure, then "recovered tax increment value" means the amount of the current year's equalized assessed value in the first year beginning at least 60 days after the notice has been provided.

SB 90 - Tracy - Amends the State Finance Act, Counties Code, Illinois Municipal Code, Metro-East Park and Recreation District Act, Local Mass Transit District Act, Regional Transportation Authority Act, and Water Commission Act of 1985. Provides that the amounts transferred into the Tax Compliance and Administration Fund shall be reduced from 1.5% to 1%. Effective July 1, 2021.

SB 113 - Feigenholtz - Amends the Property Tax Code. Provides that condominium associations and homeowner associations may also file appeals with the Property Tax Appeal Board.

SB 120 - Joyce - Amends the Illinois Municipal Code. Provides that all municipalities (currently, only municipalities in a county with a population of over 3,000,000 inhabitants) may impose a motor fuel tax. Effective immediately.

The February 5 edition of the Illinois Register did not contain any new or adopted rulemakings by the Illinois Department of Commerce and Economic Opportunity or the Illinois Department of Revenue.

No new decisions in tax-related cases this week.

No new decisions were issued by the Tribunal this week. None of the new cases raise unique issues.

The Illinois General Assembly's bipartisan Commission on Government Forecasting and Accountability has issued its Monthly Briefing for the Month Ended: January 2021

The Tax Foundation issued State Corporate Income Tax Rates and Brackets for 2021

It appears that legislation to implement a multistate compact to forbid tax incentives will be pushed this year - See HB 95 and HB 145. If you want to take a deep dive into the arguments of the proponents here is an article An Interstate Compact to End the Economic Development Subsidy Arms Race

The Property Tax Appeal Board filed its 2020 Annual Report with the Illinois General Assembly