SB1505 amends the Illinois Small Business Job Creation Tax Credit Act to renew the program for a new series of incentive periods running from July 1, 2025 through June 30, 2032. The bill continues the state tax credit for qualifying small businesses that create net new full-time Illinois jobs, with credits claimed against withholding taxes and capped at $2,500 per new employee. It also keeps the Department of Commerce and Economic Opportunity responsible for administering the program, issuing certificates, and adopting rules for businesses that use professional employer organizations (PEOs).
The bill makes several technical and substantive changes to eligibility and administration. It removes references to the Put Illinois to Work Program from the second series of incentive periods, narrows the definition of “full-time employee” to a person working at least 35 hours per week, and specifies that a replacement hire can preserve the required net employment increase if the vacancy is filled within 8 weeks. It also retains the existing framework for applications, documentation, and the $50 million cap on late-filed applications, while making the act effective immediately.
Impact
SB1505 would extend and modify an existing state tax incentive rather than create a new program. It would continue to affect the Illinois Income Tax Act by preserving a withholding-tax credit for small employers that add jobs, and it would update statutory definitions and filing rules in the Small Business Job Creation Tax Credit Act. The main affected parties are small businesses with 50 or fewer full-time employees, the Department of Commerce and Economic Opportunity, and employers using PEO arrangements; the bill would also eliminate any remaining operational role for the older Put Illinois to Work Program in future incentive periods.
Sentiment
Based on the bill text and the absence of recorded committee testimony or votes in the provided materials, the overall sentiment appears neutral to favorable toward maintaining the tax credit. The measure is framed as a renewal of an existing economic development tool, suggesting support for job creation and small business retention. No opposition, amendments, or recorded roll-call concerns are included in the provided context.
Contention
The main points of potential contention are likely to be policy and administrative rather than ideological. One issue is the renewal of a tax credit through 2032, which may raise questions about state revenue impact and whether the incentive effectively produces net new jobs. Another is the narrowing of the “full-time employee” definition to a 35-hour standard, which could affect employers whose staffing models rely on industry-custom definitions. The 8-week replacement rule may also be debated as either a practical clarification or a stricter standard than the prior “reasonable time” language. No specific objections from legislators, agencies, or stakeholders are provided in the available record.
Provides corporation business tax credits and gross income tax credits to small business employers and farm employers related to increase in State minimum wage.