IL HB0174

Adds new provisions (D-21 and D-22) to the Illinois Income Tax Act regarding qualified tuition programs under Internal Revenue Code Section 529.

For taxable years beginning January 1, 2007 and later, requires addition to base income for transfers of moneys from Illinois-administered 529 plans to out-of-state programs, equal to amounts previously deducted.

For taxable years beginning January 1, 2009 and later, requires addition to base income for nonqualified withdrawals from Illinois-administered 529 plans not used for qualified education expenses, limited to the contribution component previously deducted.

Excludes nonqualified withdrawals or refunds resulting from beneficiary death or disability from the recapture requirement.

Takes effect upon becoming law.