by Gary Peric
Baker Tilly is an IMA member law firm…
Corporate and individual taxpayers will see a significant increase in their Illinois income taxes with the July 6 passing of the state’s budget and spending bill.
Illinois is expected to generate about $5 billion in revenue by increasing the corporate income tax rate to 7 percent from 5.25 percent and the individual income tax rate to 4.95 percent from 3.75 percent, effective July 1, 2017.
After the state had gone two years without a budget, the Illinois House overrode Gov. Bruce Rauner’s vetoes of a $36 billion budget and $5 billion tax increase, two days after the Senate’s Independence Day override of his vetoes. The move may temporarily stop credit agencies that were looking to further downgrade Illinois debt to junk-bond status.
Other notable changes in the law include:
- Requiring a single combined reporting group even if members use dissimilar industry-specific (transportation, insurance, financial, etc.) apportionment methodologies
- Requiring the add-back of deductions allowed under the IRC 199 deduction
- Reinstating the R&D tax credit and extending it through Jan. 1, 2022
To review all the details of Public Act 100-002, you may find it here.
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