Reed Smith Client Alerts

In November, the Illinois Department of Revenue issued proposed regulations implementing the Illinois Legislature’s repeal of the unitary business group “non-combination rule” as part of the state’s FY 2017-18 budget. These proposed regulations mark a major shift in how unitary groups may apportion their business income.

Authors: David P. Dorner

On July 6, 2017, the Illinois Legislature enacted Public Act 100-0022 (SB9), which made a number of changes to the Illinois Income Tax Act (“IITA”), including repeal of the “non-combination rule”, which precluded a single combined return for members of a unitary business group (“UBG”) if one or more members of the UBG were required to apportion their business income under a statutory apportionment formula different from that used by the other group members. This change was effective for tax years ending on or after December 31, 2017.