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Illinois House Bill HB2861

Illinois 2025-2026 Regular Session

Illinois House Bill HB2861 Compare Versions

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11 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2861 Introduced , by Rep. Tony M. McCombie SYNOPSIS AS INTRODUCED: 805 ILCS 5/15.35 from Ch. 32, par. 15.35 Amends the Business Corporation Act of 1983. Provides that, on or after January 1, 2026 and prior to January 1, 2027, the first $100,000 in liability is exempt from the franchise tax payable by domestic corporations. Provides that, in the case of a domestic corporation, no payment is required for a franchise tax that would have been due and payable on or after January 1, 2027. Repeals the provision concerning franchise taxes payable by domestic corporations on January 1, 2027. Effective immediately. LRB104 10889 SPS 20971 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2861 Introduced , by Rep. Tony M. McCombie SYNOPSIS AS INTRODUCED: 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.35 from Ch. 32, par. 15.35 Amends the Business Corporation Act of 1983. Provides that, on or after January 1, 2026 and prior to January 1, 2027, the first $100,000 in liability is exempt from the franchise tax payable by domestic corporations. Provides that, in the case of a domestic corporation, no payment is required for a franchise tax that would have been due and payable on or after January 1, 2027. Repeals the provision concerning franchise taxes payable by domestic corporations on January 1, 2027. Effective immediately. LRB104 10889 SPS 20971 b LRB104 10889 SPS 20971 b A BILL FOR
22 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2861 Introduced , by Rep. Tony M. McCombie SYNOPSIS AS INTRODUCED:
33 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.35 from Ch. 32, par. 15.35
44 805 ILCS 5/15.35 from Ch. 32, par. 15.35
55 Amends the Business Corporation Act of 1983. Provides that, on or after January 1, 2026 and prior to January 1, 2027, the first $100,000 in liability is exempt from the franchise tax payable by domestic corporations. Provides that, in the case of a domestic corporation, no payment is required for a franchise tax that would have been due and payable on or after January 1, 2027. Repeals the provision concerning franchise taxes payable by domestic corporations on January 1, 2027. Effective immediately.
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1111 1 AN ACT concerning business.
1212 2 Be it enacted by the People of the State of Illinois,
1313 3 represented in the General Assembly:
1414 4 Section 5. The Business Corporation Act of 1983 is amended
1515 5 by changing Sections 15.35 as follows:
1616 6 (805 ILCS 5/15.35) (from Ch. 32, par. 15.35)
1717 7 (Text of Section from P.A. 102-16, 103-8, and 103-592)
1818 8 Sec. 15.35. Franchise taxes payable by domestic
1919 9 corporations. For the privilege of exercising its franchises
2020 10 in this State, each domestic corporation shall pay to the
2121 11 Secretary of State the following franchise taxes, computed on
2222 12 the basis, at the rates and for the periods prescribed in this
2323 13 Act:
2424 14 (a) An initial franchise tax at the time of filing its
2525 15 first report of issuance of shares.
2626 16 (b) An additional franchise tax at the time of filing
2727 17 (1) a report of the issuance of additional shares, or (2) a
2828 18 report of an increase in paid-in capital without the
2929 19 issuance of shares, or (3) an amendment to the articles of
3030 20 incorporation or a report of cumulative changes in paid-in
3131 21 capital, whenever any amendment or such report discloses
3232 22 an increase in its paid-in capital over the amount thereof
3333 23 last reported in any document, other than an annual
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3737 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2861 Introduced , by Rep. Tony M. McCombie SYNOPSIS AS INTRODUCED:
3838 805 ILCS 5/15.35 from Ch. 32, par. 15.35 805 ILCS 5/15.35 from Ch. 32, par. 15.35
3939 805 ILCS 5/15.35 from Ch. 32, par. 15.35
4040 Amends the Business Corporation Act of 1983. Provides that, on or after January 1, 2026 and prior to January 1, 2027, the first $100,000 in liability is exempt from the franchise tax payable by domestic corporations. Provides that, in the case of a domestic corporation, no payment is required for a franchise tax that would have been due and payable on or after January 1, 2027. Repeals the provision concerning franchise taxes payable by domestic corporations on January 1, 2027. Effective immediately.
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4343 A BILL FOR
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6868 1 report, interim annual report or final transition annual
6969 2 report required by this Act to be filed in the office of
7070 3 the Secretary of State.
7171 4 (c) An additional franchise tax at the time of filing
7272 5 a report of paid-in capital following a statutory merger
7373 6 or consolidation, which discloses that the paid-in capital
7474 7 of the surviving or new corporation immediately after the
7575 8 merger or consolidation is greater than the sum of the
7676 9 paid-in capital of all of the merged or consolidated
7777 10 corporations as last reported by them in any documents,
7878 11 other than annual reports, required by this Act to be
7979 12 filed in the office of the Secretary of State; and in
8080 13 addition, the surviving or new corporation shall be liable
8181 14 for a further additional franchise tax on the paid-in
8282 15 capital of each of the merged or consolidated corporations
8383 16 as last reported by them in any document, other than an
8484 17 annual report, required by this Act to be filed with the
8585 18 Secretary of State from their taxable year end to the next
8686 19 succeeding anniversary month or, in the case of a
8787 20 corporation which has established an extended filing
8888 21 month, the extended filing month of the surviving or new
8989 22 corporation; however if the taxable year ends within the
9090 23 2-month period immediately preceding the anniversary month
9191 24 or, in the case of a corporation which has established an
9292 25 extended filing month, the extended filing month of the
9393 26 surviving or new corporation the tax will be computed to
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104104 1 the anniversary month or, in the case of a corporation
105105 2 which has established an extended filing month, the
106106 3 extended filing month of the surviving or new corporation
107107 4 in the next succeeding calendar year.
108108 5 (d) An annual franchise tax payable each year with the
109109 6 annual report which the corporation is required by this
110110 7 Act to file.
111111 8 On or after January 1, 2020 and prior to January 1, 2021,
112112 9 the first $30 in liability is exempt from the tax imposed under
113113 10 this Section. On or after January 1, 2021, and prior to January
114114 11 1, 2024, the first $1,000 in liability is exempt from the tax
115115 12 imposed under this Section. On or after January 1, 2024, and
116116 13 before January 1, 2025, the first $5,000 in liability is
117117 14 exempt from the tax imposed under this Section. On and after
118118 15 January 1, 2025 and before January 1, 2026, the first $10,000
119119 16 in liability is exempt from the tax imposed under this
120120 17 Section. On or after January 1, 2026 and before January 1,
121121 18 2027, the first $100,000 in liability is exempt from the tax
122122 19 imposed under this Section. The provisions of this Section
123123 20 shall not require the payment of any franchise tax that would
124124 21 otherwise have been due and payable on or after January 1,
125125 22 2027. There shall be no refunds or proration of franchise tax
126126 23 for any taxes due and payable on or after January 1, 2027 on
127127 24 the basis that a portion of the corporation's taxable year
128128 25 extends beyond January 1, 2027.
129129 26 This Section is repealed on January 1, 2028.
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140140 1 (Source: P.A. 102-16, eff. 6-17-21; 103-8, eff. 6-7-23;
141141 2 103-592, eff. 6-7-24.)
142142 3 (Text of Section from P.A. 102-282, 102-558, 103-8, and
143143 4 103-592)
144144 5 Sec. 15.35. Franchise taxes payable by domestic
145145 6 corporations. For the privilege of exercising its franchises
146146 7 in this State, each domestic corporation shall pay to the
147147 8 Secretary of State the following franchise taxes, computed on
148148 9 the basis, at the rates and for the periods prescribed in this
149149 10 Act:
150150 11 (a) An initial franchise tax at the time of filing its
151151 12 first report of issuance of shares.
152152 13 (b) An additional franchise tax at the time of filing
153153 14 (1) a report of the issuance of additional shares, or (2) a
154154 15 report of an increase in paid-in capital without the
155155 16 issuance of shares, or (3) an amendment to the articles of
156156 17 incorporation or a report of cumulative changes in paid-in
157157 18 capital, whenever any amendment or such report discloses
158158 19 an increase in its paid-in capital over the amount thereof
159159 20 last reported in any document, other than an annual
160160 21 report, interim annual report or final transition annual
161161 22 report required by this Act to be filed in the office of
162162 23 the Secretary of State.
163163 24 (c) An additional franchise tax at the time of filing
164164 25 a report of paid-in capital following a statutory merger
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175175 1 or consolidation, which discloses that the paid-in capital
176176 2 of the surviving or new corporation immediately after the
177177 3 merger or consolidation is greater than the sum of the
178178 4 paid-in capital of all of the merged or consolidated
179179 5 corporations as last reported by them in any documents,
180180 6 other than annual reports, required by this Act to be
181181 7 filed in the office of the Secretary of State; and in
182182 8 addition, the surviving or new corporation shall be liable
183183 9 for a further additional franchise tax on the paid-in
184184 10 capital of each of the merged or consolidated corporations
185185 11 as last reported by them in any document, other than an
186186 12 annual report, required by this Act to be filed with the
187187 13 Secretary of State from their taxable year end to the next
188188 14 succeeding anniversary month or, in the case of a
189189 15 corporation which has established an extended filing
190190 16 month, the extended filing month of the surviving or new
191191 17 corporation; however if the taxable year ends within the
192192 18 2-month period immediately preceding the anniversary month
193193 19 or, in the case of a corporation which has established an
194194 20 extended filing month, the extended filing month of the
195195 21 surviving or new corporation the tax will be computed to
196196 22 the anniversary month or, in the case of a corporation
197197 23 which has established an extended filing month, the
198198 24 extended filing month of the surviving or new corporation
199199 25 in the next succeeding calendar year.
200200 26 (d) An annual franchise tax payable each year with the
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211211 1 annual report which the corporation is required by this
212212 2 Act to file.
213213 3 On or after January 1, 2020 and prior to January 1, 2021,
214214 4 the first $30 in liability is exempt from the tax imposed under
215215 5 this Section. On or after January 1, 2021 and prior to January
216216 6 1, 2024, the first $1,000 in liability is exempt from the tax
217217 7 imposed under this Section. On or after January 1, 2024, and
218218 8 before January 1, 2025, the first $5,000 in liability is
219219 9 exempt from the tax imposed under this Section. On and after
220220 10 January 1, 2025 and before January 1, 2026, the first $10,000
221221 11 in liability is exempt from the tax imposed under this
222222 12 Section. On or after January 1, 2026 and before January 1,
223223 13 2027, the first $100,000 in liability is exempt from the tax
224224 14 imposed under this Section. The provisions of this Section
225225 15 shall not require the payment of any franchise tax that would
226226 16 otherwise have been due and payable on or after January 1,
227227 17 2027. There shall be no refunds or proration of franchise tax
228228 18 for any taxes due and payable on or after January 1, 2027 on
229229 19 the basis that a portion of the corporation's taxable year
230230 20 extends beyond January 1, 2027.
231231 21 This Section is repealed on January 1, 2028.
232232 22 (Source: P.A. 102-282, eff. 1-1-22; 102-558, eff. 8-20-21;
233233 23 103-8, eff. 6-7-23; 103-592, eff. 6-7-24.)
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