Illinois Compiled Statutes
Chapter 35 - REVENUE
35 ILCS 50/ - Recovery and Mental Health Tax Credit Act.

(35 ILCS 50/Art. 1 heading)


 
(35 ILCS 50/Art. 3 heading)


 
(35 ILCS 50/3-1)
Sec. 3-1. Short title. This Article may be cited as the Recovery and Mental Health Tax Credit Act. References in this Article to "this Act" mean this Article.

(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-5)
Sec. 3-5. Findings.
(a) In the interest of reducing stigma and increasing the
available pool of potential employees, the General Assembly
finds and declares that those residents of Illinois diagnosed
with mental illness and substance use disorders should be
eligible for and encouraged to seek gainful employment.
(b) The General Assembly finds and declares that minority
communities in this State have been more negatively impacted in
employment opportunities for minority residents diagnosed with
mental illness and substance use disorders and should receive
additional employment opportunities and incentives for
employing minority residents diagnosed with mental illness or
substance use disorders.
(c) Due to the COVID-19 public health emergency, employers
in the State of Illinois have suffered negative economic
impacts, a loss in workforce, staffing difficulties, and have
found it difficult to recruit new workers.
(d) In the interest of providing additional employment
opportunities for those residents of Illinois diagnosed with
mental illness or substance use disorders and expanding the
pool of potential workers in this State, the General Assembly
finds and declares that certain qualified employers who employ
eligible individuals should be eligible for a tax credit.


(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-10)
Sec. 3-10. Definitions. As used in this Act:
"Department" means the Department of Human Services.
"Eligible individual" means an individual with a substance
use disorder, as that term is defined under Section 1-10 of the
Substance Use Disorder Act, or an individual with a mental
illness as that term is defined under Section 1-129 of the
Mental Health and Developmental Disabilities Code, who is in a
state of wellness and recovery where there is an abatement of
signs and symptoms that characterize active substance use
disorder or mental illness and has demonstrated to the
qualified employer's satisfaction, pursuant to rules
adopted by the Department, that he or she has completed a
course of treatment or is currently in receipt of treatment
for such substance use disorder or mental illness. A relapse
in an individual's state of wellness shall not make the
individual ineligible, so long as the individual shows a
continued commitment to recovery that aligns with an
individual's relapse prevention plan, discharge plan, or
recovery plan.
"Qualified employer" means an employer operating within
the State that has received a certificate of tax credit from
the Department after the Department has determined that the
employer:
"Taxpayer" means any individual, corporation, partnership,
trust, or other entity subject to the Illinois income tax. For
the purposes of this Act, 2 individuals filing a joint return
shall be considered one taxpayer.


(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-15)
Sec. 3-15. Authorization of tax credit program for individuals in recovery from substance use disorders or mental illness.
(a) For taxable years beginning on or after January 1, 2023, the Department is authorized to and shall establish and administer a recovery tax credit program to provide tax incentives to qualified employers who employ eligible individuals in recovery from a substance use disorder or mental illness in part-time and full-time positions within Illinois. The Department shall award the tax credit by issuance of a certificate of tax credit to the qualified employer, who will present the certificate of tax credit to the Department of Revenue by attaching the certificate to its tax return, as a credit against the qualified employer's income tax liability in accordance with the Illinois Income Tax Act. The Department shall maintain an electronic listing of the certificates issued by which the Department of Revenue may verify tax credit certificates issued.
(b) To be a qualified employer, an employer must apply annually to the Department to claim a credit based upon eligible individuals employed during the preceding calendar year, using the forms prescribed by the Department. To be approved for a credit under this Act, the employer must:
(c) To be an eligible individual, the individual must be diagnosed with or have been diagnosed with a substance use disorder or mental illness. Disclosure by the eligible individual of his or her mental illness or substance use disorder shall be completely voluntary and his or her health information may not be shared or disclosed under this Act without the eligible individual's express written consent. The eligible individual must have been employed by the qualified employer in this State for a minimum of 500 hours during the applicable calendar year and the tax credit may only begin on the date the eligible individual is hired by the qualified employer and ending on December 31 of that calendar year or the date that the eligible individual's employment with the qualified employer ends, whichever occurs first. Only one tax credit may be awarded for any eligible individual while employed by the same or related qualified employer. The hours of employment of 2 or more eligible individuals may not be aggregated to reach the minimum number of hours. If an eligible individual has worked in excess of 500 hours between the date of hiring and December 31 of that year, a qualified employer can elect to compute and claim a credit for such eligible individual in that year based on the hours worked by December 31. Alternatively, the qualified employer may elect to include such individual in the computation of the credit in the year immediately succeeding the year in which the eligible individual was hired. In that case, the credit shall be computed on the basis of all hours worked by the eligible individual from the date of hire to the earlier of the last day of employment or December 31 of the succeeding year.
(d) If Department criteria and all other requirements are
met, a qualified employer shall be entitled to a tax credit
equal to the product of $1 and the number of hours worked by
each eligible individual during the eligible individual's
period of employment with the qualified employer. The tax
credit awarded under this Act may not exceed $2,000 per eligible
individual employed by the qualified employer in this State. In
determining the amount of tax credit that any qualified
employer may claim, the Department shall review all claims
submitted for credit by all employers and, to the extent that
the total amount claimed by employers exceeds the amount
allocated for this program in that calendar year, shall issue
tax credits on a pro rata basis corresponding to each
qualified employer's share of the total amount claimed.
(e) The aggregate amount of all credits the Department may award under this Act in any calendar year may not exceed $2,000,000.
(f) A taxpayer who is a qualified
employer who has received a certificate of tax credit from the
Department shall be allowed a credit against the tax imposed equal
to the amount shown on such certificate of tax credit.
(g) The credit must be claimed in the taxable year in which the tax credit certificate is issued. The credit cannot reduce a taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, the credit may not
be carried forward.
(h) If the taxpayer is a partnership or Subchapter S corporation the credit shall be allowed to the partners or shareholders in accordance with the determination of income and distributive share of income under Sections 702 and 704 and subchapter S of the Internal Revenue Code.
(i) In carrying out this Act, no patient-specific information shall
be shared or disclosed. Any individual or patient-specific
information collected by the Department or the Department
of Revenue shall not be subject
to public disclosure or Freedom of Information Act requests.
(j) The credit under this Act is exempt from the provisions of Section 250 of the Illinois Income Tax Act.

(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-20)
Sec. 3-20. Advisory Council on Mental Illness and Substance Use Disorder Impacts on Employment Opportunities within Minority Communities. The Secretary of the Department shall appoint the Advisory Council on Mental Illness and Substance Use Disorder Impacts on Employment Opportunities within Minority Communities, to be composed of 15 members, which shall include a balanced representation of recipients, services providers, employers, local governmental units, community and welfare advocacy groups, academia, and the general public. The Advisory Council shall advise the Department regarding all aspects of employment impacts resulting from mental illnesses and substance use disorders within minority communities, tax credits, outreach, marketing, and education about the tax credit and employment opportunities, and other areas as deemed appropriate by the Secretary. In appointing the first Council, the Secretary shall name 8 members to terms of 2 years and 7 members to serve terms of 4 years, all of whom shall be appointed within 6 months of the effective date of this Act. All members appointed thereafter shall serve terms of 4 years. Members shall serve without compensation other than reimbursement of expenses actually incurred in the performance of their official duties. At its first meeting, the Advisory Council shall select a chair from among its members. The Advisory Council shall meet at least quarterly and at other times at the call of the chair.

(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-25)
Sec. 3-25. Powers. The Department shall adopt rules for the administration of this Act. The Department may enter into an intergovernmental agreement with the Department of Revenue for the administration of this Act.

(Source: P.A. 102-1053, eff. 6-10-22.)
 
(35 ILCS 50/3-30)
Sec. 3-30. (Amendatory provisions; text omitted).

(Source: P.A. 102-1053, eff. 6-10-22; text omitted.)
 
(35 ILCS 50/Art. 5 heading)


 
(35 ILCS 50/Art. 15 heading)


 
(35 ILCS 50/Art. 99 heading)


 
(35 ILCS 50/99-99)
Sec. 99-99. Effective date. This Act takes effect upon becoming law.

(Source: P.A. 102-1053, eff. 6-10-22.)

Structure Illinois Compiled Statutes