Full Text of HB2893 103rd General Assembly
HB2893 103RD GENERAL ASSEMBLY |
| | 103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024 HB2893 Introduced 2/16/2023, by Rep. Jenn Ladisch Douglass SYNOPSIS AS INTRODUCED: |
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805 ILCS 5/15.35 | from Ch. 32, par. 15.35 |
805 ILCS 5/15.65 | from Ch. 32, par. 15.65 |
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Amends the Business Corporation Act of 1983. Provides that a business with an average employee head count of 49 or fewer employees is exempt from the taxes imposed under the Act.
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| | A BILL FOR |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Business Corporation Act of 1983 is amended | 5 | | by changing Sections 15.35 and 15.65 as follows:
| 6 | | (805 ILCS 5/15.35) (from Ch. 32, par. 15.35)
| 7 | | (Text of Section from P.A. 102-16)
| 8 | | Sec. 15.35. Franchise taxes payable by domestic | 9 | | corporations. For the privilege of exercising its franchises | 10 | | in this State, each
domestic corporation shall pay to the | 11 | | Secretary of State the following
franchise taxes, computed on | 12 | | the basis, at the rates and for the periods
prescribed in this | 13 | | Act:
| 14 | | (a) An initial franchise tax at the time of filing its | 15 | | first report of
issuance of shares.
| 16 | | (b) An additional franchise tax at the time of filing | 17 | | (1) a report of
the issuance of additional shares, or (2) a | 18 | | report of an increase in paid-in
capital without the | 19 | | issuance of shares, or (3) an amendment to the articles
of | 20 | | incorporation or a report of cumulative changes in paid-in | 21 | | capital,
whenever any amendment or such report discloses | 22 | | an increase in its paid-in
capital over the amount thereof | 23 | | last reported in any document, other than
an annual |
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| 1 | | report, interim annual report or final transition annual | 2 | | report
required by this Act to be filed in the office of | 3 | | the Secretary of State.
| 4 | | (c) An additional franchise tax at the time of filing | 5 | | a report of paid-in
capital following a statutory merger | 6 | | or consolidation, which discloses that
the paid-in capital | 7 | | of the surviving or new corporation immediately after
the | 8 | | merger or consolidation is greater than the sum of the | 9 | | paid-in capital
of all of the merged or consolidated | 10 | | corporations as last reported
by them in any documents, | 11 | | other than annual reports, required by this Act
to be | 12 | | filed in the office of the Secretary of State; and in | 13 | | addition, the
surviving or new corporation shall be liable | 14 | | for a further additional franchise
tax on the paid-in | 15 | | capital of each of the merged or consolidated
corporations | 16 | | as last reported by them in any document, other than an | 17 | | annual
report, required by this Act to be filed with the | 18 | | Secretary of State from
their taxable year end to the next | 19 | | succeeding anniversary month or, in
the case of a | 20 | | corporation which has established an extended filing | 21 | | month,
the extended filing month of the surviving or new | 22 | | corporation; however if
the taxable year ends within the | 23 | | 2-month period immediately preceding the
anniversary month | 24 | | or, in the case of a corporation which has established an
| 25 | | extended filing month, the extended filing month of the | 26 | | surviving or new
corporation the tax will be computed to |
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| 1 | | the anniversary month or, in the
case of a corporation | 2 | | which has established an extended filing month, the
| 3 | | extended filing month of the surviving or new corporation | 4 | | in the next
succeeding calendar year.
| 5 | | (d) An annual franchise tax payable each year with the | 6 | | annual report
which the corporation is required by this | 7 | | Act to file.
| 8 | | On or after January 1, 2020 and prior to January 1, 2021, | 9 | | the first $30 in liability is exempt from the tax imposed under | 10 | | this Section. On or after January 1, 2021, the first $1,000 in | 11 | | liability is exempt from the tax imposed under this Section. | 12 | | (e) Notwithstanding any other provision of law, beginning | 13 | | on June 1, 2023, a business with an average employee head count | 14 | | of 49 or fewer employees is exempt from the taxes imposed under | 15 | | this Section. | 16 | | (Source: P.A. 101-9, eff. 6-5-19; 102-16, eff. 6-17-21.)
| 17 | | (Text of Section from P.A. 102-282)
| 18 | | Sec. 15.35. Franchise taxes payable by domestic | 19 | | corporations. For the privilege of exercising its franchises | 20 | | in this State, each
domestic corporation shall pay to the | 21 | | Secretary of State the following
franchise taxes, computed on | 22 | | the basis, at the rates and for the periods
prescribed in this | 23 | | Act:
| 24 | | (a) An initial franchise tax at the time of filing its | 25 | | first report of
issuance of shares.
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| 1 | | (b) An additional franchise tax at the time of filing | 2 | | (1) a report of
the issuance of additional shares, or (2) a | 3 | | report of an increase in paid-in
capital without the | 4 | | issuance of shares, or (3) an amendment to the articles
of | 5 | | incorporation or a report of cumulative changes in paid-in | 6 | | capital,
whenever any amendment or such report discloses | 7 | | an increase in its paid-in
capital over the amount thereof | 8 | | last reported in any document, other than
an annual | 9 | | report, interim annual report or final transition annual | 10 | | report
required by this Act to be filed in the office of | 11 | | the Secretary of State.
| 12 | | (c) An additional franchise tax at the time of filing | 13 | | a report of paid-in
capital following a statutory merger | 14 | | or consolidation, which discloses that
the paid-in capital | 15 | | of the surviving or new corporation immediately after
the | 16 | | merger or consolidation is greater than the sum of the | 17 | | paid-in capital
of all of the merged or consolidated | 18 | | corporations as last reported
by them in any documents, | 19 | | other than annual reports, required by this Act
to be | 20 | | filed in the office of the Secretary of State; and in | 21 | | addition, the
surviving or new corporation shall be liable | 22 | | for a further additional franchise
tax on the paid-in | 23 | | capital of each of the merged or consolidated
corporations | 24 | | as last reported by them in any document, other than an | 25 | | annual
report, required by this Act to be filed with the | 26 | | Secretary of State from
their taxable year end to the next |
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| 1 | | succeeding anniversary month or, in
the case of a | 2 | | corporation which has established an extended filing | 3 | | month,
the extended filing month of the surviving or new | 4 | | corporation; however if
the taxable year ends within the | 5 | | 2-month period immediately preceding the
anniversary month | 6 | | or, in the case of a corporation which has established an
| 7 | | extended filing month, the extended filing month of the | 8 | | surviving or new
corporation the tax will be computed to | 9 | | the anniversary month or, in the
case of a corporation | 10 | | which has established an extended filing month, the
| 11 | | extended filing month of the surviving or new corporation | 12 | | in the next
succeeding calendar year.
| 13 | | (d) An annual franchise tax payable each year with the | 14 | | annual report
which the corporation is required by this | 15 | | Act to file.
| 16 | | On or after January 1, 2020 and prior to January 1, 2021, | 17 | | the first $30 in liability is exempt from the tax imposed under | 18 | | this Section. On or after January 1, 2021 and prior to January | 19 | | 1, 2022, the first $1,000 in liability is exempt from the tax | 20 | | imposed under this Section. On or after January 1, 2022 and | 21 | | prior to January 1, 2023, the first $10,000 in liability is | 22 | | exempt from the tax imposed under this Section. On or after | 23 | | January 1, 2023 and prior to January 1, 2024, the first | 24 | | $100,000 in liability is exempt from the tax imposed under | 25 | | this Section. The provisions of this Section shall not require | 26 | | the payment of any franchise tax that would otherwise have |
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| 1 | | been due and payable on or after January 1, 2024. There shall | 2 | | be no refunds or proration of franchise tax for any taxes due | 3 | | and payable on or after January 1, 2024 on the basis that a | 4 | | portion of the corporation's taxable year extends beyond | 5 | | January 1, 2024. Public Act 101-9 shall not affect any right | 6 | | accrued or established, or any liability or penalty incurred | 7 | | prior to January 1, 2024. | 8 | | (e) Notwithstanding any other provision of law, beginning | 9 | | on June 1, 2023, a business with an average employee head count | 10 | | of 49 or fewer employees is exempt from the taxes imposed under | 11 | | this Section. | 12 | | This Section is repealed on December 31, 2024. | 13 | | (Source: P.A. 101-9, eff. 6-5-19; 102-282, eff. 1-1-22.)
| 14 | | (Text of Section from P.A. 102-558)
| 15 | | Sec. 15.35. Franchise taxes payable by domestic | 16 | | corporations. For the privilege of exercising its franchises | 17 | | in this State, each
domestic corporation shall pay to the | 18 | | Secretary of State the following
franchise taxes, computed on | 19 | | the basis, at the rates and for the periods
prescribed in this | 20 | | Act:
| 21 | | (a) An initial franchise tax at the time of filing its | 22 | | first report of
issuance of shares.
| 23 | | (b) An additional franchise tax at the time of filing | 24 | | (1) a report of
the issuance of additional shares, or (2) a | 25 | | report of an increase in paid-in
capital without the |
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| 1 | | issuance of shares, or (3) an amendment to the articles
of | 2 | | incorporation or a report of cumulative changes in paid-in | 3 | | capital,
whenever any amendment or such report discloses | 4 | | an increase in its paid-in
capital over the amount thereof | 5 | | last reported in any document, other than
an annual | 6 | | report, interim annual report or final transition annual | 7 | | report
required by this Act to be filed in the office of | 8 | | the Secretary of State.
| 9 | | (c) An additional franchise tax at the time of filing | 10 | | a report of paid-in
capital following a statutory merger | 11 | | or consolidation, which discloses that
the paid-in capital | 12 | | of the surviving or new corporation immediately after
the | 13 | | merger or consolidation is greater than the sum of the | 14 | | paid-in capital
of all of the merged or consolidated | 15 | | corporations as last reported
by them in any documents, | 16 | | other than annual reports, required by this Act
to be | 17 | | filed in the office of the Secretary of State; and in | 18 | | addition, the
surviving or new corporation shall be liable | 19 | | for a further additional franchise
tax on the paid-in | 20 | | capital of each of the merged or consolidated
corporations | 21 | | as last reported by them in any document, other than an | 22 | | annual
report, required by this Act to be filed with the | 23 | | Secretary of State from
their taxable year end to the next | 24 | | succeeding anniversary month or, in
the case of a | 25 | | corporation which has established an extended filing | 26 | | month,
the extended filing month of the surviving or new |
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| 1 | | corporation; however if
the taxable year ends within the | 2 | | 2-month period immediately preceding the
anniversary month | 3 | | or, in the case of a corporation which has established an
| 4 | | extended filing month, the extended filing month of the | 5 | | surviving or new
corporation the tax will be computed to | 6 | | the anniversary month or, in the
case of a corporation | 7 | | which has established an extended filing month, the
| 8 | | extended filing month of the surviving or new corporation | 9 | | in the next
succeeding calendar year.
| 10 | | (d) An annual franchise tax payable each year with the | 11 | | annual report
which the corporation is required by this | 12 | | Act to file.
| 13 | | On or after January 1, 2020 and prior to January 1, 2021, | 14 | | the first $30 in liability is exempt from the tax imposed under | 15 | | this Section. On or after January 1, 2021 and prior to January | 16 | | 1, 2022, the first $1,000 in liability is exempt from the tax | 17 | | imposed under this Section. On or after January 1, 2022 and | 18 | | prior to January 1, 2023, the first $10,000 in liability is | 19 | | exempt from the tax imposed under this Section. On or after | 20 | | January 1, 2023 and prior to January 1, 2024, the first | 21 | | $100,000 in liability is exempt from the tax imposed under | 22 | | this Section. The provisions of this Section shall not require | 23 | | the payment of any franchise tax that would otherwise have | 24 | | been due and payable on or after January 1, 2024. There shall | 25 | | be no refunds or proration of franchise tax for any taxes due | 26 | | and payable on or after January 1, 2024 on the basis that a |
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| 1 | | portion of the corporation's taxable year extends beyond | 2 | | January 1, 2024. Public Act 101-9 shall not affect any right | 3 | | accrued or established, or any liability or penalty incurred | 4 | | prior to January 1, 2024. | 5 | | (e) Notwithstanding any other provision of law, beginning | 6 | | on June 1, 2023, a business with an average employee head count | 7 | | of 49 or fewer employees is exempt from the taxes imposed under | 8 | | this Section. | 9 | | This Section is repealed on December 31, 2025. | 10 | | (Source: P.A. 101-9, eff. 6-5-19; 102-558, eff. 8-20-21. )
| 11 | | (805 ILCS 5/15.65) (from Ch. 32, par. 15.65)
| 12 | | Sec. 15.65. Franchise taxes payable by foreign | 13 | | corporations. For the privilege of exercising its authority to | 14 | | transact such business
in this State as set out in its | 15 | | application therefor or any amendment
thereto, each foreign | 16 | | corporation shall pay to the Secretary of State the
following | 17 | | franchise taxes, computed on the basis, at the rates and for | 18 | | the
periods prescribed in this Act:
| 19 | | (a) An initial franchise tax at the time of filing its | 20 | | application for
authority to transact business in this | 21 | | State.
| 22 | | (b) An additional franchise tax at the time of filing | 23 | | (1) a report of
the issuance of additional shares, or (2) a | 24 | | report of an increase in paid-in
capital without the | 25 | | issuance of shares, or (3) a report of cumulative
changes |
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| 1 | | in paid-in capital or a report of an exchange or | 2 | | reclassification
of shares, whenever any such report | 3 | | discloses an increase in its paid-in
capital over the | 4 | | amount thereof last reported in any document, other than
| 5 | | an annual report, interim annual report or final | 6 | | transition annual report,
required by this Act to be filed | 7 | | in the office of the Secretary of State.
| 8 | | (c) Whenever the corporation shall be a party to a | 9 | | statutory merger and
shall be the surviving corporation, | 10 | | an additional franchise tax at the time
of filing its | 11 | | report following merger, if such report discloses that the
| 12 | | amount represented in this State of its paid-in capital | 13 | | immediately after
the merger is greater than the aggregate | 14 | | of the amounts represented in this
State of the paid-in | 15 | | capital of such of the merged corporations as were
| 16 | | authorized to transact business in this State at the time | 17 | | of the merger, as
last reported by them in any documents, | 18 | | other than annual reports, required
by this Act to be | 19 | | filed in the office of the Secretary of State; and in
| 20 | | addition, the surviving corporation shall be liable for a | 21 | | further
additional franchise tax on the paid-in capital of | 22 | | each of the merged
corporations as last reported by them | 23 | | in any document, other than an annual
report, required by | 24 | | this Act to be filed with the Secretary
of State, from | 25 | | their taxable year end to the next succeeding anniversary
| 26 | | month or, in the case of a corporation which has |
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| 1 | | established an extended
filing month, the extended filing | 2 | | month of the surviving corporation;
however if the taxable | 3 | | year ends within the 2-month period immediately
preceding | 4 | | the anniversary month or the extended filing month of the
| 5 | | surviving corporation, the tax will be computed to the | 6 | | anniversary or,
extended filing month of the surviving | 7 | | corporation in the next succeeding
calendar year.
| 8 | | (d) An annual franchise tax payable each year with any
| 9 | | annual report which the corporation is required by this | 10 | | Act to file.
| 11 | | On or after January 1, 2020 and prior to January 1, 2021, | 12 | | the first $30 in liability is exempt from the tax imposed under | 13 | | this Section. On or after January 1, 2021, the first $1,000 in | 14 | | liability is exempt from the tax imposed under this Section. | 15 | | (e) Notwithstanding any other provision of law, beginning | 16 | | on June 1, 2023, a business with an average employee head count | 17 | | of 49 or fewer employees is exempt from the taxes imposed under | 18 | | this Section. | 19 | | (Source: P.A. 101-9, eff. 6-5-19; 102-16, eff. 6-17-21; | 20 | | 102-558, eff. 8-20-21; 102-813, eff. 5-13-22 .)
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