Analysis of the

Illinois Corporate Tax Disclosure and Responsibility Act

How it works
The Illinois Corporate Tax Disclosure and Responsibility Act (SB 282) requires publicly traded corporations and their subsidiaries to disclose certain tax information if they do business in Illinois. The information would then be available to the public two years after the end of the tax year. After which the information will be made available through a searchable internet database created by the Secretary of State.

Items to be disclosed
The name of the corporation, the address of its principal executive offices; The name of any corporation that owns more than 50% of its stock and the address of that corporations principal executive offices; The corporations 4 digit NAICS (North American Industry Classification System) code (this indicates what type of industry the corporation is in); The taxable income of the corporation after all the additions on the Illinois return. To start the Illinois return, a corporation starts with its federal taxable income and then adds certain amounts to this amount. The result is the corporations income for Illinois purposes; The base income of the corporation. This is derived after the corporation makes certain deductions from their Illinois income, such as deductions related to Enterprise Zones or other deductions allowed by Illinois law; The corporations apportionment factor. This is a percentage that is multiplied by the corporations base income to determine how much of the corporations income should be taxable by Illinois. Most corporations apportionment factor is based on sales the corporation made in Illinois divided by the total sales of the corporation. There are special apportionment methods for insurance companies, transportation companies, financial organizations, and federally regulated exchanges; The corporations total business income that is apportioned to the State. This is the amount of business income that is taxable by the State (non-business income is income from royalties, interest, dividends, and other similar income); The corporations Illinois net operating loss deduction if any. This is the amount a corporation can subtract for losses from previous years; The total non-business income of the corporation and the amount of non-business income allocated to the State. This includes income from patents, royalties, rents, dividends, and copyrights. It is common for businesses to try and shift income from one state to another by inflating these costs or generating income through these methods; The net income of the corporation. This is the final amount that is multiplied by the corporate income tax rate and the replacement tax rate; The corporations income tax liability before the application of any tax credits; The corporations replacement tax liability before the application of any tax credits; An itemized list of the tax credits that the company claims and the amount of each credit. This includes the R&D credit, EDGE credit, film tax credit, enterprise zone credit, river edge redevelopment zone credits, and other various credits; The total income tax after the application of all credits; The total replacement tax after application of all credits.