Illinois Department of Revenue FY March Claims for Environmental
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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.