Illinois Compiled Statutes 35 ILCS 55/15 – Allowable credit
Current as of: 2024 | Check for updates
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(a) For tax years ending on or after December 31, 2027 and beginning before January 1, 2029, a credit is allowed against the taxes imposed on an eligible taxpayer under subsections (a) and (b) of Section 201 of the Illinois Income Tax Act in an amount equal to $1 per kilogram of eligible qualifying hydrogen used by the eligible taxpayer during the immediately preceding calendar year. If the use of the qualifying hydrogen by a taxpayer occurs in or impacts one or more equity investment eligible communities, then, to be eligible for this credit, the taxpayer must submit to the Department and make publicly available documentation that demonstrates that the use has led to a net reduction of negative environmental impacts in each impacted equity investment eligible community and demonstrates that all application requirements detailed in this Act, including those in subsection (c), have been met for the year in which the credit is sought. Those impacts shall include direct, indirect, and cumulative impacts, including, but not limited to, impacts from using, transporting, and storing qualifying hydrogen, and impacts to air, water, traffic, noise, and public health. This documentation must be specific, quantifiable, measurable, and verifiable. Continued receipt of tax credits is contingent upon the taxpayer making this demonstration each year. Failure to demonstrate a reduction of negative environmental impacts in each impacted equity investment eligible community shall result in the denial or forfeiture of tax credits.
(b) The allowable credit provided in subsection (a) of this Section shall be increased by $0.15 per kilogram of eligible qualifying hydrogen for eligible qualifying hydrogen use impacting one or more equity investment eligible communities if an eligible taxpayer specifically, quantifiably, and verifiably demonstrates that the eligible qualifying hydrogen use satisfies both of the following criteria for the preceding tax year:
(1) The eligible taxpayer’s project workforce meets
(b) The allowable credit provided in subsection (a) of this Section shall be increased by $0.15 per kilogram of eligible qualifying hydrogen for eligible qualifying hydrogen use impacting one or more equity investment eligible communities if an eligible taxpayer specifically, quantifiably, and verifiably demonstrates that the eligible qualifying hydrogen use satisfies both of the following criteria for the preceding tax year:
(1) The eligible taxpayer’s project workforce meets
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the minimum equity standards for equity eligible persons and equity eligible contractors determined by the Illinois Power Agency pursuant to subsection (c-10) of Section 1-75 of the Illinois Power Agency Act. This requirement shall apply to both construction employment and ongoing employment in areas such as, but not limited to, operations, production, and maintenance.
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(2) At least 40% of the total benefits provided by
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the use are received by the equity investment eligible communities impacted by the eligible qualifying hydrogen use. Benefits to be considered shall include, but are not limited to: a decrease in the percentage of household income spent on energy costs; a decrease in environmental exposures and burdens; an increase in access to low-cost capital; an increase in employment and job training for residents; an increase in clean energy enterprise creation and contracting; increases in community energy ownership; increased parity in clean energy technology and adoption; and an increase in energy resilience. As used in this item (2), “energy resilience” means the ability to operate energy services in response to a major disruption. Employment and contracting benefits provided pursuant to paragraph (1) shall count toward this 40% requirement.
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(c) The Department shall develop an application process for tax credits under this Section that provides meaningful, timely, and effective public notice of a tax credit application to members of impacted communities, accounting for linguistic needs and other relevant characteristics, and provides meaningful opportunity for public comment on any tax credit application. The public notice and tax credit application shall be translated into non-English languages in impacted communities where a language other than English is widely spoken. The notice must, at a minimum, include all of the following: the name of the applicant, the location of the use, a brief description of the use and its impacts, and a link to a website where the application and more detailed information on the use and its impacts can be found. The notice shall be written at a third or fourth grade reading level to ensure ease of understanding for all members of the public. The opportunity for public comment must, at a minimum, include a public meeting held in a location within an impacted equity investment community and easily accessible to residents of other impacted equity investment eligible communities. Such public meeting shall be held not less than 30 days after public notice is provided and not less than 30 days before a decision is made on the application. The Department shall consider comments received when determining whether the requirements of this Section have been met. Applications, supporting materials, and comments submitted with respect to applications shall be maintained on the Department website in a publicly accessible manner.
(d) An eligible taxpayer may not earn tax credits for a tax year for eligible qualifying hydrogen use in an amount that exceeds the amount of tax credit allocated to it for the tax year under Section 25. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one tax year that are available to offset a liability, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer’s liability to less than zero.
(e) Labor performed on or after the effective date of this Act to convert the eligible taxpayer’s existing equipment or to install new equipment for the eligible taxpayer to enable eligible qualifying hydrogen use for which a credit is claimed under this Act shall be performed by general contractors that enter into a project labor agreement, as defined by the Illinois Power Agency Act, prior to construction. The project labor agreement shall be filed with the Department.
(f) Notwithstanding any provision of law to the contrary, any eligible taxpayer receiving tax credits under this Act shall be required to enter into a labor peace agreement with any bona fide labor organization that represents or is attempting to represent any of its employees.
(d) An eligible taxpayer may not earn tax credits for a tax year for eligible qualifying hydrogen use in an amount that exceeds the amount of tax credit allocated to it for the tax year under Section 25. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one tax year that are available to offset a liability, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer’s liability to less than zero.
(e) Labor performed on or after the effective date of this Act to convert the eligible taxpayer’s existing equipment or to install new equipment for the eligible taxpayer to enable eligible qualifying hydrogen use for which a credit is claimed under this Act shall be performed by general contractors that enter into a project labor agreement, as defined by the Illinois Power Agency Act, prior to construction. The project labor agreement shall be filed with the Department.
(f) Notwithstanding any provision of law to the contrary, any eligible taxpayer receiving tax credits under this Act shall be required to enter into a labor peace agreement with any bona fide labor organization that represents or is attempting to represent any of its employees.