IL HB4669

Creates a deduction for individuals, corporations, trusts, estates, and partnerships allowing up to $50,000 per tax year contributed to a "small business asset purchase account" plus all interest earned on such accounts, effective for tax years beginning January 1, 2025.

Defines a "small business asset purchase account" as an account established by a taxpayer whose proceeds are used to purchase property used primarily in Illinois for which a federal Section 179 income tax deduction is claimed.

Requires taxpayers to add back to income (as an addition modification) any amounts withdrawn from the account that are not used for qualified property purchases, with such amounts also subject to a 10% penalty under the Uniform Penalty and Interest Act.

Adds Section 3-3.5 to the Uniform Penalty and Interest Act establishing a 10% penalty on improper withdrawals from small business asset purchase accounts that are not used for qualified Illinois property or lack a Section 179 deduction claim.

Applies to all taxpayer types (individuals, S-corporations, partnerships, trusts, and estates) with the same $50,000 annual contribution limit and interest deduction.