Schedule 1299-C (IL-1040)

This article explains how to fill out Illinois Schedule 1299-C (IL-1040): Income Tax Subtractions and Credits for Individuals, with step-by-step, line-by-line instructions based on the official form for tax year 2024.

Schedule 1299-C is an Illinois tax form used by individual taxpayers to claim income tax subtractions and tax credits that reduce their Illinois income tax liability. It must be attached to Form IL-1040 (your Illinois individual income tax return). This schedule is for individuals who qualify for certain income tax subtractions (like River Edge Redevelopment Zone dividends) or credits (like Research and Development, K–12 Instructional Materials, or Adoption credits). The form also helps taxpayers carry forward unused credits from previous years.

All figures must be rounded to whole dollars. If you are carrying credits from a previous year, refer to your 2026 Schedule 1299-C, Step 3 for the amount of available carryforward. If you have more subtractions or credits than space allows, you must attach a separate schedule in the same format.

Step 1 Figure Your Subtractions

Step 1: Figure Your Subtractions

Lines 1a–1c: River Edge Redevelopment Zone Dividend Subtraction

  • Column A: Enter the corporation’s name.
  • Column B: Enter the name of the River Edge Redevelopment Zone.
  • Column C: Enter the dividend amount for each corporation.

Line 2:

Enter any distributive share of River Edge Redevelopment Zone Dividend Subtraction received from partnerships, S corporations, trusts, or estates. Attach Schedule K-1-P or K-1-T as proof.

Line 3:

Add all amounts in Column C (Lines 1a through 1c) plus Line 2. Enter the total.

Lines 4a–4c: High Impact Business Within a Foreign Trade Zone (or Sub-Zone) Dividend Subtraction

  • Column A: Enter the corporation’s name.
  • Column B: Enter the name of the zone.
  • Column C: Enter the dividend amount.

Line 5:

Enter any distributive share of High Impact Business dividend subtraction from partnerships, S corporations, trusts, or estates. Attach Schedule K-1-P or K-1-T.

Line 6:

Add Lines 4a through 4c and Line 5. Enter the total.

Line 7:

Add Line 3 and Line 6. This is your total dividend subtraction.
Enter this amount here and on Schedule M, Line 24.

Step 2: Worksheets (Complete Only If You Earned These Credits)

This step is used to calculate your Research and Development Credit, K–12 Instructional Materials and Supplies Credit, and Adoption Credit before entering them in Step 3.

Research and Development Credit (Lines 8–10)

  • Line 8: Enter base period average expenses (Column A) and this year’s expenses (Column B) from Schedule 1299-I, Line 6 of the R&D worksheet.
  • Line 9: Subtract Line 8, Column A from Line 8, Column B. If negative, enter zero.
  • Line 10: Multiply Line 9 by 6.5% (.065). Enter this result here and also in Step 3, Column E on the line with “5” in Column A and Credit Code 5340 in Column B.

K–12 Instructional Materials and Supplies Credit (Lines 11–12)

For teachers, instructors, counselors, principals, or aides who worked 900 or more hours in a K–12 Illinois school:

  • Line 11a: Enter your Professional Educator License number (if applicable).
  • Line 11b: Enter the school name (Illinois only).
  • Line 11c: Enter your total qualified expenses paid in 2024.
  • Line 11d: Enter the lesser of Line 11c or $500.
  • Line 12: Add Line 11d for both primary taxpayer and spouse (if applicable). Enter the total here and in Step 3, Column E with “5” in Column A and Credit Code 5740 in Column B.

Adoption Credit (Lines 13–16)

Part 1 – Adopted Child Information

  • Lines 13–15: Enter the child’s name, identifying number, birth date, and whether they were an Illinois resident in 2024.

Part 2 – Figure Your Credit

For each child:

  • Line 16a: Enter the maximum credit allowed per child (see instructions).
  • Line 16b: Enter any Illinois adoption credit previously claimed for that child.
  • Line 16c: Subtract Line b from Line a.
  • Line 16d: Enter qualified adoption expenses (see instructions).
  • Line 16e: Enter the lesser of Line 16c or Line 16d.
  • Line 16f: Add all qualified adoption expenses from Line 16e.
  • Line 16g:
    • Illinois residents: enter 1.0.
    • Nonresidents/part-year residents: enter the decimal from Schedule NR, Line 48.
  • Line 16h: Multiply Line 16f by Line 16g. Enter the result here and in Step 3, Column E with “5” in Column A and Credit Code 5780 in Column B.

Step 3: Figure Your Income Tax Credit

This is where you total your credits and determine what portion you can use this year.

Line 17:

Enter your income tax from Form IL-1040, Line 14.

Line 18:

Add the credit amounts from Form IL-1040, Lines 15 and 16. Enter the total.

Line 19:

Subtract Line 18 from Line 17. If zero or negative, enter zero.

Lines 20–41:

Use Columns A–J to enter each credit:

  • Column A: Years left to carry credit.
  • Column B: Credit code.
  • Column C: Tax year credit earned.
  • Column D: Identifying number.
  • Column E: Credit earned or carried.
  • Column F: Distributive share or transfer credit.
  • Column G: Total credit.
  • Column H: Calculation credit applied.
  • Column I: Credit carryforward.
  • Column J: Remaining credit (if any).

Fill in as many lines (20 through 41) as needed to list each credit type. Attach a separate sheet if more lines are required.

Line 42:

Add all amounts in Column I and enter the total here.

Line 43:

Follow the Schedule 1299-C instructions to determine how much of the credit you can claim this year.
Enter this amount here and on Form IL-1040, Line 17.

Important Notes

  • Attach Schedule 1299-C to your Form IL-1040 when filing.
  • Check the box if attaching to Amended Form IL-1040-X.
  • Ensure every figure is accurate and supported by documentation (e.g., Schedules K-1-P, K-1-T, NR).
  • If you attempt to claim a credit or subtraction that doesn’t exist, processing delays or disallowances may occur.
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