Bill > HB2861

This bill amends the Business Corporation Act of 1983 to modify franchise tax requirements for domestic corporations in Illinois. Specifically, for the tax year starting January 1, 2026 and ending before January 1, 2027, the first $100,000 of a corporation's franchise tax liability will be exempt. After January 1, 2027, domestic corporations will no longer be required to pay any franchise tax, effectively eliminating this financial obligation. The bill includes a provision that prevents any refunds or prorating of franchise taxes for tax years partially extending beyond January 1, 2027, and the entire section related to franchise taxes will be automatically repealed on January 1, 2028. This change continues a trend of progressively increasing tax exemptions for domestic corporations that has been ongoing since 2020, when the exemption was first set at just $30 and has gradually increased to the current proposed $100,000 threshold. The bill aims to reduce the financial burden on domestic corporations operating in Illinois and ultimately eliminate their franchise tax responsibility.

Budget and Finance

https://www.ilga.gov/legislation/BillStatus.asp?DocNum=2861&GAID=18&DocTypeID=HB&SessionID=114&GA=104