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Illinois Department of Revenue FY 2003-09
Claims for Environmental Remediation Tax Credit
March 2003
Informational Bulletin
To: All taxpayers and tax professionals who are eligible to claim
a credit carryforward or distribution of the Environmental
Brian A. Hamer Remediation Tax Credit.
Director of Revenue
For information This bulletin serves to clarify the tax year 2000. Partnership A has
or forms... process of determining limits four partners who are entitled to
imposed on and the distribution and distributions. For tax year 2000, the
Call us at: the carryforward of the limit of $40,000 is imposed at the
1 800 732-8866 or Environmental Remediation Tax partnership level. If all four partners
217 782-3336 Credit. receive equal distributions, each
partner would be allowed a credit of
Call our TDD The Environmental Remediation $10,000 for tax year 2000.
(telecommunications device Tax Credit is valid for tax years Partnership A would be allowed to
for the deaf) at: ending on or after January 1, 1998, carry forward the remaining $45,000
1 800 544-5304 through tax years ending on or for up to 5 years. In tax year 2001,
before December 31, 2001. The Partnership A has enough credit to
Write us at: allowable credit is limited to again claim the full $40,000 amount
Illinois Department of Revenue $40,000 and provides a credit
P.O. Box 19044 and distribute $10,000 to each
carryforward of any excess credit partner. In 2002, a credit of $5,000
Springfield, IL 62794-9044
for up to 5 years, which includes tax remains for the partnership to
years ending after distribute. Each partner would be
Visit our Web site at:
December 31, 2001. eligible to claim $1,250. Even
www.ILtax.com
How does the $40,000 though the partnership is no longer
Call allowed to earn the credit after
limitation apply to
“Illinois Tax Fax,” our December 31, 2001, the 5-year
fax-on-demand service, at: S corporations and carryforward of excess credit allows
217 785-3400 partnerships? the partnership to distribute the
The $40,000 limit is initially applied remaining credit through
Call
our 24-hour at the S corporation or partnership December 31, 2005, because the
Forms Order Line at: level. The total amount that the credit was initially earned in 2000.
1 800 356-6302 S corporation or partnership How does an S corporation or
distributes to its partners or
partnership report the credit
shareholders cannot exceed
$40,000. Any excess credit at the
carryforward for the 2002 tax
S corporation or partnership level year?
may be carried forward and In previous years, the credit was
distributed to partners and shown for partnerships and
shareholders for up to five years. S corporations on Schedule 1299-A,
For example: Tax Subtractions and Credits. Any
flow-through amount to a partner or
Partnership A earns an shareholder was reported on
Printed by authority of the State of Illinois
Environmental Remediation Tax Schedule K-1-P, Partner’s or
200 copies - 3/03 - P.O. Number 2031065 Credit in the amount of $85,000 in Shareholder’s Share of Income,
Claims for Environmental Remediation Tax Credit FY 2003-09
Page Informational Bulletin
2
Deductions, Credits, and How does a partner or Corporations, Trusts,
Recapture. The revisions made shareholder who received a Estates, and Exempt
to both schedules for the 2002 credit carryforward Organizations:
tax year failed to take into distribution report that Corporations, Trusts, Estates, and
account the possibility that any
amount for the 2002 tax Exempt Organizations that
excess credit would be available
for use. If you have available
year? receive a credit carryforward
distribution must use Schedule
credit, follow the instructions Individuals: 1299-D, Income Tax Credits, to
below in order to claim and
Individuals receiving a credit report the amount of their
distribute any credit
carryforward distribution must allowable distribution. The
carryforward.
use Schedule 1299-C, Income amount of allowable credit is
Schedule 1299-A: Tax Subtractions and Credits, to reported to you by the
report the amount of their partnership or S corporation on
On the bottom of the back page allowable distribution. The Schedule K-1-P.
of Schedule 1299-A, write amount of allowable credit is
“Carryforward of Environmental reported to you by the Write the amount of the
Remediation Tax Credit from partnership or S corporation on allowable credit carryforward
prior year.” Write the amount of Schedule K-1-P. from Schedule K-1-P on
the credit carryforward or Schedule 1299-D, Step 3, Line
$40,000, whichever is less. Write the amount of the 44. Follow the instructions on
allowable credit carryforward Schedule 1299-D to figure the
Schedule K-1-P: from Schedule K-1-P on allowable credit for your annual
Schedule 1299-C, Step 4, Line tax return. You must attach
For each partner or shareholder
38. Follow the instructions on Schedule 1299-D and Schedule
complete the following process:
Schedule 1299-C to figure your K-1-P to your tax return to
On the bottom of the back page total allowable credit for Form receive the credit.
of Schedule K-1-P, write IL-1040, Individual Income Tax
“Carryforward of Environmental Return, or IL-1040-X, Amended
Remediation Tax Credit.” Write Individual Income Tax Return.
the allowable distribution amount You must attach a copy of
of the carryforward. Schedule 1299-C and Schedule
K-1-P to your tax return to
receive the credit.
