functional test in Illinois

2007In examining the Texaco-Cities case, the First District noted the supreme court determined “the functional test for business income is satisfied where the asset disposed of was used by the taxpayer as an integral part of its regular trade or business operations.” Blessing/White, 329 Ill.

2007However, the First District found the supreme court’s opinion allowed the use of a modified form of the functional test “when the disposition of assets was made pursuant to a corporate liquidation in cessation of business.” Blessing/White, 329 Ill.

2017The Union notes the language of the “policymaking exception” in section 3(n) of the Labor Act (5 ILCS 315/3(n) (West 2012)) is the same language used by the Seventh Circuit in Nekolny v. Painter, 653 F.2d 1164, 1169 (7th Cir. 1981). ¶ 46 In Nekolny, the Seventh Circuit established a functional test to determine whether the State may constitutionally make party affiliation an appropriate employment consideration.

2017The Union notes the language of the “policymaking exception” in section 3(n) of the Labor Act (5 ILCS 315/3(n) (West 2012)) is the same language used by the Seventh Circuit in Nekolny v. Painter, 653 F.2d 1164, 1169 (7th Cir. 1981). ¶ 46 In Nekolny, the Seventh Circuit established a functional test to determine whether the State may constitutionally make party affiliation an appropriate employment consideration.

2002See Kemppel , 746 N.E.2d at 1076 ; Ross-Araco , 674 A.2d at 693 9: Other courts have expressed substantially similar descriptions of the functional test.

2002See Kemppel , 746 N.E.2d at 1076 (income is classified as business income under the functional test if "use of the property constituted an integral part of the regular course of a trade or business operation"); Hoechst , 22 P.3d at 340 (the functional approach focuses on the income-producing property and classifies gain as business income "if the taxpayer's acquisition, control and use of the property contribute materially to the taxpayer's production of business income"); Ross-Araco , 674 A.2d at 693 ("income is business income if the gain arises from the sale of an asset that produced busine

2007The supreme court found the functional test contained in “section 1501(a)(1) focuses upon the role or function of the property as being integral to regular business operations.” Texaco-Cities, 182 Ill. 2d at 272 , 695 N.E.2d at 486 .

2007The supreme court found the functional test contained in “section 1501(a)(1) focuses upon the role or function of the property as being integral to regular business operations.” Texaco-Cities, 182 Ill. 2d at 272 , 695 N.E.2d at 486 .

2005It further rejected the taxpayer’s interpretation that section 1501 did not include the functional test based on the appellate court’s express conclusion to the contrary in National Realty & Investment Co. v. Department of Revenue, 144 Ill.

2002The second test is the functional test, where "all gain from the disposition of property is considered business income if the property disposed of was used by the taxpayer in its regular trade or business operations. [Citation.] If either test is met, the income is business income." National Realty , 144 Ill.

2002See Kemppel , 746 N.E.2d at 1076 (income is classified as business income under the functional test if "use of the property constituted an integral part of the regular course of a trade or business operation"); Hoechst , 22 P.3d at 340 (the functional approach focuses on the income-producing property and classifies gain as business income "if the taxpayer's acquisition, control and use of the property contribute materially to the taxpayer's production of business income"); Ross-Araco , 674 A.2d at 693 ("income is business income if the gain arises from the sale of an asset that produced busine

2002See Kemppel, 91 Ohio St. 3d at 423 , 746 N.E.2d at 1076 (income is classified as business income under the functional test if “use of the property constituted an integral part of the regular course of a trade or business operation”); Hoechst, 25 Cal. 4th at 531 , 22 P.3d at 340 , 106 Cal. Rptr. 2d at 567 (the functional approach focuses on the income-producing property and classifies gain as business income “if the taxpayer’s acquisition, control and use of the property contribute materially to the taxpayer’s production of business income”); Ross-Araco, 544 Pa. at 79 , 674 A.2d at 693 (“income

2002While initially explaining that the functional test will be satisfied "if the gain arises from the sale of an asset which produced business income while it was owned by the taxpayer," the court nevertheless found the nature of the transaction engaged in by the taxpayer significant, explaining the "statutory definition of business income requires that 'the acquisition, management, and disposition of the property constitute integral parts of the taxpayer's regular trade or business operations.'" (Emphasis in original.) Laurel Pipe Line , 642 N.E.2d at 475.

2002While initially explaining that the functional test will be satisfied “if the gain arises from the sale of an asset which produced business income while it was owned by the taxpayer,” the court nevertheless found the nature of the transaction engaged in by the taxpayer significant, explaining the “statutory definition of business income requires that 'the acquisition, management, and disposition of the property constitute integral parts of the taxpayer’s regular trade or business operations.’ ” (Emphasis in original.) Laurel Pipe Line, 537 Pa. at 211 , 642 N.E.2d at 475.

2002See Kemppel v. Zaino , 746 N.E.2d 1073, 1076 (Ohio 2001); The May Department Stores Co. v. Indiana Dept. of State Rev. , 749 N.E.2d 651, 658 (Ind. Tax Ct. 2001); Polaroid Corp. v. Offerman , 507 S.E.2d 284, 289 (N.C. 1998). 8: Other courts applying the functional test have stated that the asset's production of income while it was owned by the taxpayer is a central consideration in determining whether the functional approach has been met.

2002See Kemppel v. Zaino, 91 Ohio St. 3d 420, 423 , 746 N.E.2d 1073, 1076 (2001); The May Department Stores Co. v. Indiana Department of State Revenue, 749 N.E.2d 651, 658 (Ind. Tax Ct. 2001); Polaroid Corp. v. Offerman, 349 N.C. 290, 295 , 507 S.E.2d 284, 289 (1998). 8 Other courts applying the functional test have stated that the asset’s production of income while it was owned by the taxpayer is a central consideration in determining whether the functional approach has been met.

2002See Kemppel v. Zaino , 746 N.E.2d 1073, 1076 (Ohio 2001); The May Department Stores Co. v. Indiana Dept. of State Rev. , 749 N.E.2d 651, 658 (Ind. Tax Ct. 2001); Polaroid Corp. v. Offerman , 507 S.E.2d 284, 289 (N.C. 1998). 8: Other courts applying the functional test have stated that the asset's production of income while it was owned by the taxpayer is a central consideration in determining whether the functional approach has been met.

2002See Kemppel v. Zaino, 91 Ohio St. 3d 420, 423 , 746 N.E.2d 1073, 1076 (2001); The May Department Stores Co. v. Indiana Department of State Revenue, 749 N.E.2d 651, 658 (Ind. Tax Ct. 2001); Polaroid Corp. v. Offerman, 349 N.C. 290, 295 , 507 S.E.2d 284, 289 (1998). 8 Other courts applying the functional test have stated that the asset’s production of income while it was owned by the taxpayer is a central consideration in determining whether the functional approach has been met.

2002See Kemppel , 746 N.E.2d at 1076 (income is classified as business income under the functional test if "use of the property constituted an integral part of the regular course of a trade or business operation"); Hoechst , 22 P.3d at 340 (the functional approach focuses on the income-producing property and classifies gain as business income "if the taxpayer's acquisition, control and use of the property contribute materially to the taxpayer's production of business income"); Ross-Araco , 674 A.2d at 693 ("income is business income if the gain arises from the sale of an asset that produced busine

2002See Kemppel, 91 Ohio St. 3d at 423 , 746 N.E.2d at 1076 (income is classified as business income under the functional test if “use of the property constituted an integral part of the regular course of a trade or business operation”); Hoechst, 25 Cal. 4th at 531 , 22 P.3d at 340 , 106 Cal. Rptr. 2d at 567 (the functional approach focuses on the income-producing property and classifies gain as business income “if the taxpayer’s acquisition, control and use of the property contribute materially to the taxpayer’s production of business income”); Ross-Araco, 544 Pa. at 79 , 674 A.2d at 693 (“income

2002See Kemppel v. Zaino , 746 N.E.2d 1073, 1076 (Ohio 2001); The May Department Stores Co. v. Indiana Dept. of State Rev. , 749 N.E.2d 651, 658 (Ind. Tax Ct. 2001); Polaroid Corp. v. Offerman , 507 S.E.2d 284, 289 (N.C. 1998). 8: Other courts applying the functional test have stated that the asset's production of income while it was owned by the taxpayer is a central consideration in determining whether the functional approach has been met.

2002See Kemppel , 746 N.E.2d at 1076 ; Ross-Araco , 674 A.2d at 693 9: Other courts have expressed substantially similar descriptions of the functional test.

2009A more functional test to evaluate whether a decision is against the manifest weight of the evidence is provided by Justice Quinn in Kresin v. Sears, Roebuck & Co., 316 Ill.

2008A more functional test to evaluate whether a decision is against the manifest weight of the evidence is provided by Justice Quinn in Kresin v. Sears, Roebuck & Co., 316 Ill.