HB1959 Summary

• Creates a new tax credit for financial institutions with less than $50 billion in assets for tax years ending after July 1, 2021.

• Credit equals the aggregate amount of all fees, penalties, and other income derived from commercial loan transactions that are (i) less than $5 million, (ii) originated by the institution, (iii) made to Illinois residents or entities, and (iv) made primarily for business or agricultural projects in Illinois.

• Credit applies to partners, shareholders of S-corporations, and LLC owners based on their proportionate income share under IRC Sections 702, 704, and Subchapter S.

• Defines "financial institution" as partnerships, associations, LLCs, or corporations authorized to operate as banks, savings and loans, or savings banks under state or federal law.

• Provision is exempt from Section 250 limitations on tax credits.