Schedule 4255: Recapture of Investment Tax Credits (2024)
Illinois · Illinois DOR · Used for tax years 2024
Illinois Schedule 4255 calculates recapture of investment tax credits when property becomes disqualified, along with additional income tax credit recapture. It also reports recapture amounts passed through from partnerships and S corporations and attaches to your Illinois tax ret
Who files this form
Schedule 4255 is used to report recapture of Illinois investment tax credits, including:
- Enterprise Zone or River Edge Redevelopment Zone Investment Credit
- High Impact Business Investment Credit
- REV Illinois Investment Credit
- Replacement Tax Investment Credit
- MICRO Investment Credit
It also includes a section for additional income tax credit recapture and lines for recapture passed through from partnerships and S corporations on Schedule K-1-P.
The form does not explain when a credit becomes subject to recapture.
What you'll need
Have the following information available to complete the schedule:
- Your name as shown on your return and your SSN or FEIN.
- The month and year ending the tax year when the property was placed in service.
- Each property's description, original basis, credit rate, dates placed in service in Illinois and disqualified, and reason for disqualification.
- The applicable zone name or project location, where requested.
- Your total property basis, original credit amount, and original tax amount.
- Any other Schedule 4255 filed this year whose recapture amount must be included.
- Schedule(s) K-1-P showing your share of recapture from partnerships or S corporations, if applicable.
- Prior-year credit amounts requested in Step 7, if you have additional income tax credit recapture.
How to file
Attach Schedule 4255 to your Form IL-1040, IL-1120, IL-1065, IL-1120-ST, IL-1041, or IL-990-T.
Complete the applicable property credit calculations in Steps 1 through 5, then carry those totals to the matching columns on Line 13 in Step 6. Use Step 6 to calculate the total recapture amounts.
Complete Step 7 only if you have additional income tax credit recapture. If you attach multiple Schedules 4255, complete Step 7 only on the last schedule you complete.
The supplied form text does not provide a mailing address or e-filing instructions.
Common mistakes
- Leaving out required information. The form warns that disclosure is required and failure to provide information could result in a penalty.
- Completing Step 7 when it does not apply. Do not complete Step 7 if you have no additional income tax credit recapture amounts.
- Completing Step 7 on multiple schedules. If you attach multiple Schedules 4255, complete Step 7 only on the last schedule you complete.
Questions people ask
What identifying information goes on Schedule 4255?
Enter your name as shown on your return and your Social Security number or federal employer identification number.
How is the disqualified credit amount calculated?
In Steps 1 through 5, multiply the property's original basis by its credit rate. Add the amounts within each step and carry the total to the corresponding column on Line 13.
What if the calculation on Line 17 is negative?
Enter zero. Line 17 subtracts your adjusted credit on Line 14 from the credit previously used on Line 16.
Where do I report recapture passed through from a partnership or S corporation?
Report your distributive share from Schedule(s) K-1-P on Line 19 for the credits covered by Step 6. Report your share of additional income tax credit recapture on Line 32.