The House and Senate returned to Springfield August 31 and addressed legislative redistricting changes necessitated by the release of census numbers by the U.S. Census Bureau.

The Senate also passed its version of an energy bill, SB 18 The bill was not taken up by the House on August 31 and its prospects in the House are unclear. As of this morning, it is unclear when the House may return to Springfield to take up consideration of SB 18.

There are some tax-related provisions in SB 18.

At p.220 of the engrossed version of the bill, the definition of "high impact business" is modified to add as a qualifying high impact business, a business that intends to establish a new utility-scale solar facility at a designated location in Illinois.

P. 562 of the bill proposes the complete repeal of Section 206 of the Illinois Income Tax Act - Tax credits for coal research and coal utilization equipment. That provision is currently in the IITA, although it had a sunset date of January 1, 2005.

There are amendments to the Property Tax Code.

At page 565, Section 1-130 of the Code is amended to add a new subsection that provides that spent fuel pools and dry cask storage systems in which nuclear fuel is stored and is pending further or final disposal from a nuclear power plant that was decommissioned before January 1, 2021 shall be considered real property and shall be assessable.

At p. 567, Section 10-5 of the Property Tax Code dealing with solar energy systems is amended by the addition of the following subparagraph (D) to the definition of "solar energy system":

"(D) Photovoltaic electricity generation systems subject to power purchase agreements or leases for solar energy between a third-party owner, an operator, or both, and an end user of electricity, where such systems are located on the end user of electricity's side of the electric meter and which primarily are used to offset the electricity load of the end user behind whose electric meter the system is connected. A system primarily is used to offset the electricity load of the end user of electricity if the system is estimated to produce 110% or fewer kilowatt-hours of electricity than consumed by the end user of electricity at such meter in the last 12 full months prior to the system being placed in service."

At page 568, Section 10-60(a) of the Property Tax Code, which is a portion of Division 18 dealing with wind energy property assessment is amended to provide that provisions of the Division apply through 2035 - current law states 2021.

As of this morning, there were no remaining bills that passed the General Assembly at the end of the spring session that are awaiting action by the Governor. The only bill awaiting action by the Governor is the legislative redistricting legislation that amends the legislative district maps in light of the receipt of final census numbers that passed the General Assembly on August 31.

The following tax-related legislation from the spring session was signed by the Governor over the past week.

HB 3174 (P.A. 102-0605) - As introduced: Amends the Illinois Enterprise Zone Act. With respect to new wind power facilities and Wind Energy Businesses, repeals language providing that (i) the penalties for failure to comply with the Prevailing Wage Act are limited to the penalties identified in the Prevailing Wage Act and (ii) the Department of Commerce and Economic Opportunity may not revoke a High Impact Business designation as a result of the failure to comply with the Prevailing Wage Act. Effective immediately.

SB 1667 (P.A. 102-0625 - Amends the Property Tax Code. Provides that certification of the levy by the county clerk may be done electronically. Provides that the materials that may be submitted electronically include any supplemental or supportive documentation.

SB 2066 (P.A. 102-0634 - Amends the Retailers' Occupation Tax Act. Provides that, beginning January 1, 2020 and through December 31, 2020, sales of tangible personal property made by a marketplace seller over a marketplace for which tax is due but for which use tax has been collected and remitted to the Department of Revenue by a marketplace facilitator are exempt. Provides that the term "marketplace facilitator" does not include any person licensed under the Auction License Act, other than any person who is an Internet auction listing service. Amends the Leveling the Playing Field for Illinois Retail Act. Provides that certified service providers who collect and remit taxes on behalf of retailers may claim the retailers' discount with respect to those taxes. Provides that the retailer is not entitled to the discount with respect to those taxes. Effective immediately.

SB 2244 (P.A. 102-0644) - Amends the Senior Citizens Real Estate Tax Deferral Act. Provides that the income limitation under the Act is $65,000 for tax years 2022 through 2025 and $55,000 for tax year 2026 and thereafter (currently, $55,000). Provides that, for tax years 2022 through 2025, the total amount of any such deferral shall not exceed $7,500 per taxpayer in each tax year (currently, $5,000). Provides that, beginning again in tax year 2026, the total amount of any such deferral shall not exceed $5,000. Effective immediately.

SB 2531 (P.A. 102-0656) - Provides that the entity-level tax applies for taxable years ending on or after December 31, 2021 and beginning prior to January 1, 2026. Provides that the entity-level tax shall be in an amount equal to 4.95% of the taxpayer's net income for the taxable year. Defines "net income". Provides that a partnership or Subchapter S corporation that elects to pay tax at the entity level is required to pay estimated tax if the amount payable as estimated tax can reasonably be expected to exceed $500. Provides that provisions concerning pass-through entities apply only with respect to taxable years for which a specified limitation on individual deductions applies under the Internal Revenue Code. Adds a corresponding addition modification. Makes a conforming change with respect to the Local Government Distributive Fund.

The September 3 edition of the Illinois Register did not contain any proposed or adopted rulemakings by the Illinois Department of Revenue or by the Department of Commerce and Economic Opportunity.

Today's Illinois Register contains the statement issued by the Joint Committee on Administrative Rules explaining the reasons it suspended the IDOR emergency amendments to the Leveling the Playing Field rules. Here is the statement:

"At its meeting on August 18, 2021, the Joint Committee on Administrative Rules voted to object to and suspend the above-referenced emergency rule titled Leveling the Playing Field for Illinois Retail Act (86 Ill Adm Code 131; 45 Ill. Reg. 9625) and to notify the Secretary of State of the Suspension of the emergency rule. The reasons for the Suspension are as follows:

The emergency rule does not meet the criteria of 1 Ill. Adm. Code 230.400 and meets one or more of the criteria in 1 Ill. Adm. Code 230.550. DOR implemented many changes to the rules that implemented the Leveling the Playing Field for Illinois Retail Act and SB 2066 of the 102nd General Assembly via emergency rulemaking on July 13, 2021. These changes are occurring in the middle of a tax year, do not specify whether the changes apply to the entire tax year or only prospectively, and did not permit affected entities adequate time to implement required changes to their tax systems. Additionally, DOR has employed "anticipatory rulemaking" in advance of the enactment of SB 2066, which contains the necessary statutory authorization for changes contained in this rulemaking. While JCAR appreciates that DOR is working to place these policies of general applicability into rule in a timely manner, the general rulemaking procedures of Section 5-40 of the IAPA should have been used. JCAR finds the adoption of this emergency rule constitutes a serious threat to the public interest and welfare because DOR has failed to: provide an adequate explanation in writing of the emergency situation that warranted immediate adoption of this rule without public comment; limit the rule to matters that are required to meet the emergency situation; produce a rulemaking that complies the statutory authority upon which it is based; and consider the economic effects of the rules upon those regulated.  

The suspended emergency rule may not be enforced by the Department of Revenue for any reason, nor may the Department file with the Secretary of State any rule having substantially the same purpose and effect as the suspended rule, for as long as the Suspension remains in effect. "

No new tax-related court cases were released 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: August 2021.