99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB1367
 
Introduced 2/4/2015, by Rep. Kelly M. Cassidy
 
SYNOPSIS AS INTRODUCED:
 

 
805 ILCS 180/1-26

     Amends the Limited Liability Company Act. Provides that a low-profit limited liability company may be organized for religious, scientific, and literary purposes, for the purpose of fostering amateur sports competition, and for the purpose of preventing cruelty to children or animals.
  


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A BILL FOR
 

  
HB1367LRB099 07162 JLS 27253 b


  
1    AN ACT concerning business.
  
 
2    Be it enacted by the People of the State of Illinois,
 
3represented in the General Assembly:
  
 
 
4    Section 5. The Limited Liability Company Act is amended  by 
5changing Section 1-26 as follows:
 
6    (805 ILCS 180/1-26)

7    Sec. 1-26. Low-profit limited liability company. 
8    (a) A  low-profit limited liability company shall at all 
9times significantly further the accomplishment of one or more 
10charitable, religious, scientific, literary, or educational 
11purposes, the purpose of fostering national or international 
12amateur sports competition (but only if no part of its 
13activities involve the provision of athletic facilities or 
14equipment), or the purpose of prevention of cruelty to children 
15or animals, within the meaning of Section 170(c)(2)(B) of the 
16Internal Revenue Code of 1986, 26 U.S.C. 170(c)(2)(B), or its 
17successor, and would not have been formed but for the 
18relationship to the accomplishment of such  charitable or 
19educational purposes.
20    (b) A limited liability company which intends to qualify as 
21a low-profit limited liability company pursuant to the 
22provisions of this Section shall so indicate in its articles of 
23organization, and further state that: 
 
 
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1        (1) no significant purpose of the company is the 
2    production of income or the appreciation of property; 
3    however, the fact that a person produces significant income 
4    or capital appreciation shall not, in the absence of other 
5    factors, be conclusive evidence of a significant purpose 
6    involving the production of income or the appreciation of 
7    property; and 
8        (2) no purpose of the company is to accomplish one or 
9    more political or legislative purposes within the meaning 
10    of Section 170(c)(2)(D) of the Internal Revenue Code of 
11    1986, 26 U.S.C. 170(c)(2)(D), or its successor. 
12    (c) A company that no longer satisfies the requirements of 
13this Section 1-26 continues to exist  as a limited liability 
14company and shall promptly amend its articles of organization 
15so that its name and purpose no longer identify it as a 
16low-profit limited liability company or L3C. 
17    (d) Any company operating or holding itself out as a  
18low-profit limited liability company in Illinois, any company 
19formed as a low-profit limited liability company under this  
20Act, and any chief operating officer, director, or manager of  
21any such company is a "trustee" as defined in Section 3 of the
  
22Charitable Trust Act. 
23    (e) Nothing in this Section 1-26 prevents a limited 
24liability company that is not organized under it from electing 
25a charitable or educational purpose set forth in subsection (a) 
26in whole or in part for doing business under this Act. 

 
 
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1(Source: P.A. 96-126, eff. 1-1-10; 96-1000, eff. 7-2-10.)