Illinois HB 2861: DOMESTIC FRANCHISE TAX-REPEAL

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104TH GENERAL ASSEMBLY 
State of Illinois 
2025 and 2026
HB2861

Introduced 2/6/2025, 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

HB2861LRB104 10889 SPS 20971 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 Business Corporation Act of 1983 is amended 

5by changing Sections 15.35 as follows:

6 (805 ILCS 5/15.35) (from Ch. 32, par. 15.35)

7 (Text of Section from P.A. 102-16, 103-8, and 103-592)

8 Sec. 15.35. Franchise taxes payable by domestic 

9corporations. For the privilege of exercising its franchises 

10in this State, each domestic corporation shall pay to the 

11Secretary of State the following franchise taxes, computed on 

12the basis, at the rates and for the periods prescribed in this 

13Act:

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