HB 5203

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Full Text of HB5203
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					HB5203 - 104th General Assembly
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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB5203
Introduced 2/10/2026, by Rep. Michael J. Kelly
SYNOPSIS AS INTRODUCED:
35 ILCS 5/246 new
    Amends the Illinois Income Tax Act. Creates an income tax credit for a taxpayer who owns, operates, or manages a hotel. Provides that the amount of the credit is equal to 25% of the qualified renovation expenditures incurred during the taxable year, subject to specified limitations. Effective immediately.
				LRB104 18609 HLH 32052 b
A BILL FOR
		HB5203		LRB104 18609 HLH 32052 b
1		    AN ACT concerning revenue.
2		    Be it enacted by the People of the State of Illinois,
3		represented in the General Assembly:
4		    Section 5. The Illinois Income Tax Act is amended by
5		adding Section 246 as follows:
6		    (35 ILCS 5/246 new)
7		    Sec. 246. Hotel renovation tax credit.
8		    (a) As used in this Section:
9		    "Qualified renovation expenditures" means expenditures 
10		directly related to the renovation, rehabilitation, or 
11		improvement of a hotel property located in this State, to the 
12		extent those costs are demonstrably increased as a result of 
13		tariffs imposed on imported materials on or after January 1, 
14		2025.
15		    "Qualified taxpayer" means a taxpayer that is subject to 
16		tax under subsections (a) and (b) of Section 201 of this Act 
17		and who owns, operates, or manages a hotel as defined in the 
18		Hotel Operators' Occupation Tax Act.
19		    "Union labor" means labor performed by individuals who are 
20		members of a bona fide labor organization recognized under 
21		federal or State law.
22		    (b) For taxable years beginning on or after January 1, 
23		2027 and beginning before January 1, 2035, a qualified 
		HB5203	- 2 -	LRB104 18609 HLH 32052 b
1		taxpayer is entitled to a credit against the tax imposed by 
2		subsections (a) and (b) of Section 201 of this Act in an amount 
3		equal to 25% of the qualified renovation expenditures incurred 
4		during the taxable year, subject to the limitations provided 
5		in this Section.
6		    (c) To be eligible for the credit under this Section:
7		        (1) the taxpayer must certify that all construction, 
8		    renovation, or rehabilitation work related to the claimed 
9		    expenditures was performed using union labor;
10		        (2) the taxpayer must provide documentation, as 
11		    prescribed by the Department, demonstrating that the 
12		    renovation costs were increased due to tariffs on 
13		    materials; and
14		        (3) the taxpayer must maintain records sufficient to 
15		    substantiate eligibility for the credit for a period of 
16		    not less than 5 years.
17		    (d) The total amount of the credit allowed under this 
18		Section for any taxpayer in a taxable year shall not exceed 
19		$500,000. The credit may not reduce the taxpayer's liability 
20		to less than zero. Any unused credit may be carried forward and 
21		applied to the taxpayer's liability for up to 5 taxable years 
22		following the year in which the credit is first allowed.
23		    (e) The Department shall adopt rules and prescribe forms 
24		as necessary to implement and administer this Section, 
25		including rules for verifying tariff-related cost increases 
26		and union labor compliance.
		HB5203	- 3 -	LRB104 18609 HLH 32052 b
1		    Section 99. Effective date. This Act takes effect upon
2		becoming law.