ESTATE TAX-FEDERAL EXCLUSION

Illinois General Assembly - Full Text of HB4772

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB4772

Introduced , by Rep. Jay Hoffman

SYNOPSIS AS INTRODUCED:

35 ILCS 405/2

from Ch. 120, par. 405A-2

Amends the Illinois Estate and Generation-Skipping Transfer Tax Act.
Provides that, for persons dying on or after January 1, 2027, the exclusion
amount for purposes of the Act is the applicable exclusion amount set forth
in Section 2010 of the Internal Revenue Code. Effective immediately.
LRB104 19644 HLH 33093 b

A BILL FOR

HB4772
LRB104 19644 HLH 33093 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 Estate and Generation-Skipping
5
Transfer Tax Act is amended by changing Section 2 as follows:

6

(35 ILCS 405/2)

(from Ch. 120, par. 405A-2)
7

Sec. 2.
Definitions.
In this Act:

8

"Federal estate tax" means the tax due to the United
9
States with respect to a taxable transfer under Chapter 11 of
10
the Internal Revenue Code.
11

"Federal generation-skipping transfer tax" means the tax
12
due to the United States with respect to a taxable transfer
13
under Chapter 13 of the Internal Revenue Code.
14

"Federal return" means the federal estate tax return with
15
respect to the federal estate tax and means the federal
16
generation-skipping transfer tax return with respect to the
17
federal generation-skipping transfer tax.
18

"Federal transfer tax" means the federal estate tax or the
19
federal generation-skipping transfer tax.
20

"Illinois estate tax" means the tax due to this State with
21
respect to a taxable transfer.
22

"Illinois generation-skipping transfer tax" means the tax
23
due to this State with respect to a taxable transfer that gives

HB4772
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LRB104 19644 HLH 33093 b
1
rise to a federal generation-skipping transfer tax.
2

"Illinois transfer tax" means the Illinois estate tax or
3
the Illinois generation-skipping transfer tax.
4

"Internal Revenue Code" means, unless otherwise provided,
5
the Internal Revenue Code of 1986, as amended from time to
6
time.
7

"Non-resident trust" means a trust that is not a resident
8
of this State for purposes of the Illinois Income Tax Act, as
9
amended from time to time.
10

"Person" means and includes any individual, trust, estate,
11
partnership, association, company or corporation.
12

"Qualified heir" means a qualified heir as defined in
13
Section 2032A(e)(1) of the Internal Revenue Code.
14

"Resident trust" means a trust that is a resident of this
15
State for purposes of the Illinois Income Tax Act, as amended
16
from time to time.
17

"State" means any state, territory or possession of the
18
United States and the District of Columbia.
19

"State tax credit" means:
20

(a) For persons dying on or after January 1, 2003 and
21
through December 31, 2005, an amount equal to the full credit
22
calculable under Section 2011 or Section 2604 of the Internal
23
Revenue Code as the credit would have been computed and
24
allowed under the Internal Revenue Code as in effect on
25
December 31, 2001, without the reduction in the State Death
26
Tax Credit as provided in Section 2011(b)(2) or the

HB4772
- 3 -
LRB104 19644 HLH 33093 b
1
termination of the State Death Tax Credit as provided in
2
Section 2011(f) as enacted by the Economic Growth and Tax
3
Relief Reconciliation Act of 2001, but recognizing the
4
increased applicable exclusion amount through December 31,
5
2005.
6

(b) For persons dying after December 31, 2005 and on or
7
before December 31, 2009, and for persons dying after December
8
31, 2010, an amount equal to the full credit calculable under
9
Section 2011 or 2604 of the Internal Revenue Code as the credit
10
would have been computed and allowed under the Internal
11
Revenue Code as in effect on December 31, 2001, without the
12
reduction in the State Death Tax Credit as provided in Section
13
2011(b)(2) or the termination of the State Death Tax Credit as
14
provided in Section 2011(f) as enacted by the Economic Growth
15
and Tax Relief Reconciliation Act of 2001, but
with the
16
following modifications:
17

(1) the exclusion amount shall be:

recognizing the
18

exclusion amount of only (i)

19

(A)
$2,000,000 for persons dying prior to January
20

1, 2012
;

,
21

(B)

(ii)
$3,500,000 for persons dying on or after
22

January 1, 2012 and prior to January 1, 2013
;

, and

23

(C)

(iii)
$4,000,000 for persons dying on or after
24

January 1, 2013
and before January 1, 2027; and

,
25

(D) for persons dying on or after January 1, 2027,
26

the applicable exclusion amount set forth under

HB4772
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LRB104 19644 HLH 33093 b
1

Section 2010 of the Internal Revenue Code, including
2

any deceased spousal unused exclusion amount available
3

after a valid election is made under subparagraph (A)
4

of paragraph (5) of subsection (c) of Section 2010 of
5

the Internal Revenue Code; and

6

(2) the State tax credit shall be calculated

and
with
7

a
reduction to the adjusted taxable estate for any
8

qualified terminable interest property election as defined
9

in subsection (b-1) of this Section.
10

(b-1) The person required to file the Illinois return may
11
elect on a timely filed Illinois return a marital deduction
12
for qualified terminable interest property under Section
13
2056(b)(7) of the Internal Revenue Code for purposes of the
14
Illinois estate tax that is separate and independent of any
15
qualified terminable interest property election for federal
16
estate tax purposes. For purposes of the Illinois estate tax,
17
the inclusion of property in the gross estate of a surviving
18
spouse is the same as under Section 2044 of the Internal
19
Revenue Code.
20

In the case of any trust for which a State or federal
21
qualified terminable interest property election is made, the
22
trustee may not retain non-income producing assets for more
23
than a reasonable amount of time without the consent of the
24
surviving spouse.
25

"Taxable transfer" means an event that gives rise to a
26
state tax credit, including any credit as a result of the

HB4772
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LRB104 19644 HLH 33093 b
1
imposition of an additional tax under Section 2032A(c) of the
2
Internal Revenue Code.
3

"Transferee" means a transferee within the meaning of
4
Section 2603(a)(1) and Section 6901(h) of the Internal Revenue
5
Code.
6

"Transferred property" means:

7

(1) With respect to a taxable transfer occurring at
8

the death of an individual, the deceased individual's
9

gross estate as defined in Section 2031 of the Internal
10

Revenue Code.

11

(2) With respect to a taxable transfer occurring as a
12

result of a taxable termination as defined in Section
13

2612(a) of the Internal Revenue Code, the taxable amount
14

determined under Section 2622(a) of the Internal Revenue
15

Code.

16

(3) With respect to a taxable transfer occurring as a
17

result of a taxable distribution as defined in Section
18

2612(b) of the Internal Revenue Code, the taxable amount
19

determined under Section 2621(a) of the Internal Revenue
20

Code.

21

(4) With respect to an event which causes the
22

imposition of an additional estate tax under Section
23

2032A(c) of the Internal Revenue Code, the qualified real
24

property that was disposed of or which ceased to be used
25

for the qualified use, within the meaning of Section
26

2032A(c)(1) of the Internal Revenue Code.

HB4772
- 6 -
LRB104 19644 HLH 33093 b
1

"Trust" includes a trust as defined in Section 2652(b)(1)
2
of the Internal Revenue Code.
3
(Source: P.A. 96-789, eff. 9-8-09; 96-1496, eff. 1-13-11;
4
97-636, eff. 6-1-12; revised 7-24-25.)

5

Section 99.
Effective date.
This Act takes effect upon
6
becoming law.

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