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HB 3588

Relating to business registrations; and declaring an emergency.

2025 Regular Session Introduced by Rob Nosse

Expands and clarifies series LLC rules, limiting each series' debts to its own assets and letting single-member LLCs appeal property tax assessments as single taxpayers.

Chapter 158, (2025 Laws): Effective date May 27, 2025.
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Bill Summary · HB 3588

HB 3588 — Summary (805 ILCS 180/37‑40)

Relating to business registrations; declared an emergency. Chapter 158 (2025 Laws). Effective May 27, 2025. Introduced by Rep. Rita Mayfield.

Main purpose

Amends Section 37‑40 of the Illinois Limited Liability Company Act to (1) clarify and expand rules governing “series” within an LLC (series LLCs), including how liability, records, filing, names, and operations are treated, and (2) explicitly provide that a single‑member LLC is considered a single taxpayer and may appeal property tax assessments under Division 4 of the Property Tax Code.

Key provisions

  • Series formation and liability
    • An operating agreement may establish one or more designated series with separate rights, powers, duties, obligations, profits/losses, business purposes, or investment objectives.
    • If (a) the operating agreement creates series, (b) separate and distinct records are maintained, (c) assets of a series are held and accounted for separately (directly or indirectly, including via nominee), (d) the articles of organization contain notice of the limitation, and (e) a certificate of designation for each protected series is filed with the Secretary of State, then:
    • Debts, liabilities and obligations of a series are enforceable against that series’ assets only — not the LLC’s general assets or other series’ assets — except where joint liability is expressly accepted by contract.
    • Filing the certificate of designation in the Secretary of State’s office constitutes public notice of the limitation on liability.
  • Series powers and operations
    • A protected series may contract, hold title to assets, grant security interests, sue and be sued, and otherwise act in its own name to the extent set forth in the articles/operating agreement.
    • A limited liability company (and its series) may elect to consolidate operations or be treated as a single business for qualification in other states; such elections do not negate series liability limitations unless series accept joint liability.
  • Administrative and naming rules
    • Certificates of designation must list each series’ name and business address of managers and any members with manager authority; filing, amendments, name changes, and dissolution procedures are specified.
    • Series names must be distinguishable and, for foreign LLCs using an assumed name, must commence with the admitted foreign name.
    • The LLC’s Illinois registered agent and registered office serve as agent and office for service of process for each series.
    • A series is in good standing while the parent LLC is in good standing.
  • Single‑member LLC tax appeal right
    • A single‑member LLC is expressly considered a single taxpayer and is granted the right to appeal property tax assessments under Division 4 of the Property Tax Code.

Who is affected

  • Illinois LLCs that use (or plan to use) series structures — owners, managers, creditors, and counterparties will be affected by clarified liability boundaries and filing/recordkeeping requirements.
  • Single‑member LLCs — gain explicit standing to appeal property tax assessments.
  • Secretary of State — receives and maintains certificates of designation and related filings.
  • Tax authorities and assessing bodies — must recognize single‑member LLCs as single taxpayers for appeal purposes.

Procedural / timeline notes

  • Introduced Feb 18, 2025 (Rep. Rita Mayfield). Multiple committee references and hearings (Revenue & Finance, Labor & Business, etc.). Amended and passed both houses in May 2025.
  • Governor signed May 27, 2025; Act effective May 27, 2025 (Chapter 158, 2025 Laws).

Citation

Amends 805 ILCS 180/37‑40 (Limited Liability Company Act).

Compiled from official sources — confirm details with the bill’s official record.

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