United States

Illinois extends EDGE tax credit program an additional four months

Agreement deadline extended to April 30, 2017

TAX ALERT  | 

On Jan. 20, 2017, Illinois Gov. Bruce Rauner signed Senate Bill 513, extending the sunset date of the Illinois Economic Development for a Growing Economy Tax Credit Act (EDGE) from Dec. 31, 2016, to April 30, 2017.

The Illinois EDGE program is operated by the Illinois Department of Commerce and Economic Opportunity (DCEO) and designed to offer a special tax incentive to encourage companies to locate or expand operations in Illinois when there is active consideration of a competing location in another state. The program can provide tax credits to qualifying companies, equal to the amount of state income taxes withheld from the salaries of employees in the newly created jobs. The nonrefundable credits can be used against corporate income taxes to be paid over a period not to exceed 10 years.

To qualify, applicants must be in the manufacturing, processing, assembling, warehousing, distribution, research and development or tourism service business. Qualifying projects must involve one of the following:  

  • A commitment to a capital investment in Illinois of at least $5 million and a minimum of 25 new full-time jobs
  • If the applicant has 100 or fewer employees, then the thresholds adjust to $1 million of new capital investment and creation of at least five new, full-time jobs
  • An investment in both capital improvements and employment of new employees at thresholds determined by the DCEO

Additionally, projects may still be approved under certain conditions when the minimum job creation and investment thresholds are not achieved.

The DCEO and the business awarded the credit must enter into an agreement, the terms of which become public. The extension of the deadline to enter into an Illinois EDGE agreement provides employers an additional opportunity to submit an application and enter into an agreement with the DCEO by April 30, 2017. Taxpayers considering the EDGE program should speak to their tax advisors as soon as possible.

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