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Legislation

  • March 1, 2010 | Practice News
    Abolition of the death penalty
    The Illinois Coalition Against the Death Penalty is having a lobby day in Springfield on Thursday, March 11. They are inviting supporters to register and participate at the State House to lobby individual legislators. More information may be found here.  House Bill 5687 (Yarbrough, D-Maywood) and Senate Bill 3569 (Delgado, D-Chicago) have been filed to do this.
  • January 14, 2010 | Practice News
    Probate Act and attorney's fees
    Senate Bill 2514 (Silverstein, D-Chicago) requires an attorney who withdraws from representing a representative to file a petition for fees and costs within 30 days after the withdrawal is approved by the court. Senate Bill 2514 was introduced Jan. 12. Senate Bill 2514 may be found at this link
  • December 17, 2009 | Practice News
    Increased partnership tax repealed
    Public Act 96-835 was signed into law yesterday and took effect the same day. It restores a tax deduction that had been repealed in this spring’s budget bill. The repeal changed tax policy effective for tax years after Dec. 31, 2009 by limiting partnerships’ deduction to “guaranteed payments” instead of “reasonable compensation” for the Personal Property Replacement Tax. That change generally limits the deduction to income partners because equity partners’ income is based on their share of the distributable income of the partnership. It may be found at this link.
  • November 23, 2009 | Practice News
    Rules of Professional Conduct amended
    Today the Supreme Court of Illinois amended Rule 1.15 and 3.9 of the Illinois Rules of Professional Conduct. Both changes are effective Jan. 1, 2010. Rule 1.15 is amended to change the definition of "safe harbor," which is a yield that if paid by the financial institution on IOLTA accounts is deemed as a comparable return in compliance with this Rule. It now provides that the yield may be calculated as 70% of the Federal Funds Target Rate on the first business day of the calendar month "or 1%, whichever is higher." (New text in quotation marks.) The second change deletes the recent incorporation of Rule 3.5 (ex parte prohibitions) into Rule 3.9, which regulates advocates in nonadjudicative proceedings. It clarifies that Rule 3.9 applies only when a lawyer represents a client in an official hearing or meeting of a governmental agency or legislative body to which the lawyer or the lawyer's client is presenting evidence or argument. It does not apply to representation of a client in otherwise permitted lobbying activities.
  • November 15, 2009 | Practice News
    Federal legislation affecting business entities
    There is federal legislation pending affecting disclosing information about state business entities such as LLCs and partnerships. S. 569 (Levin, D-MI) is entitled the "Incorporation Transparency and Law Enforcement Assistance Act of 2009." This Act is supposed to combat money laundering, tax evasion, and terrorist financing. It requires states to maintain beneficial ownership information and make it available to law enforcement. Other requirements include making lawyers "formation agents" if they are involved in forming a corporation, limited liability company, partnership, trust or other legal entity. This bill is in the Senate Homeland Security Committee where it has had two hearings. If it passes out of this Committee, it will still have to be sent to the Senate Banking Committee. Thanks to the American Bar Association Government Affairs Office for alerting us to this bill.
  • October 29, 2009 | Practice News
    Partnership tax deduction passed by General Assembly
    This spring's budget bill, Public Act 96-45, changed tax policy effective for tax years ending Dec. 31, 2009 by limiting partnerships’ deduction to “guaranteed payments” instead of “reasonable compensation” for the Personal Property Replacement Tax. That change generally limits the deduction to income partners because equity partners’ income is based on their share of the distributable income of the partnership. House Bill 2239 (Currie, D-Chicago; Harmon, D-Oak Park) restores this deduction.  It has passed both chambers today and will be sent to the Governor within 30 days for his signature, amendatory  veto, or veto.
  • October 27, 2009 | Practice News
    Fee to petition state government
    Recently enacted Public Act 96-555 increased the fees to petition Illinois government for registered lobbyists and their clients to a $1,000 per year. The fees had been $150 for Sec. 501(c)(3) corporations and $350 for everybody else. This applies to any person or group that falls under the definitions of the Lobbyist Registration Act. Part of the revenue currently generated goes to enforcement of the Act and part goes to the General Revenue Fund. The dedicated part of the enforcement fund now has a $400,000 balance. There is an effort underway to persuade the General Assembly to reduce these fees back to $150 and $350 this week in veto session using Senate Bill 2109 as a vehicle.
  • October 21, 2009 | Practice News
    House repeals Red Flag Rule for small businesses
    Yesterday in Washington the House of Representatives sent the Senate HR 3763 that repeals the Red Flag Rule for small businesses in which lawyers and others would be treated as creditors for identity theft. Under a rule effective August 1, 2009, the Federal Trade Commission requires  lawyers, including solo practitioners, to have in place written protocols to detect and address the "red flags" of identity theft. Bar associations, including the ABA and ISBA, are registering objections. Helen Gunnarsson's August 2009 piece in the Illinois Bar Journal goes into more detail on the Red Flag Rule.
  • October 18, 2009 | Practice News
    Repeal of partnership tax change
    Last week in veto session the Senate repealed a part of a the budget bill enacted into law in June. The budget bill, Public Act 96-45, changed tax policy effective for tax years ending Dec. 31, 2009 by limiting partnerships’ deduction to “guaranteed payments” instead of “reasonable compensation” for the Personal Property Replacement Tax. That change generally limits the deduction to income partners because equity partners’ income is based on their share of the distributable income of the partnership. Last week the Senate passed 57-0-0 a repeal of this part of PA 96-45 in House Bill 2239.  The House will consider the bill the week of Oct. 26th.
  • October 6, 2009 | Practice News
    Change in taxation of personal-service income
    There is an effort underway during October's veto session in Springfield  to repeal part of a recently enacted budget bill (Public Act 96-45). Currently, the Federal Government and most states do not tax income of partnerships, “S” corporations, and limited liability companies (LLCs) that elect to be treated as partnerships. Instead, the income is taxed after it flows through to individual partners or shareholders. Illinois has followed this practice for regular income tax purposes but does tax these entities with the PPRT. (Personal-Property Replacement-Income Tax.) This tax was meant to be a replacement for the property tax revenue lost by municipalities when the tax on personal property was repealed in the 1980s. The municipalities receive the revenue generated by the PPRT. Illinois has allowed “S” and “C” corporations to deduct compensation paid to owners, but partnerships were not allowed to do so. To treat partnerships in the same way as S and C corporations, Illinois has allowed partnerships to deduct a portion of their distributable income that represented reasonable compensation. In calculating the tax base for the PPRT, partnerships that generate their income through the personal services of its partners and employees (like law firms) are allowed a deduction for the profits of the partnership distributed to the partners (both equity and stipend) so that their PPRT tax base is essentially zero. This deduction was meant to parallel the compensation deduction allowed to C and S corporations in arriving at the PPRT tax base. Public Act 96-45 changes this tax policy effective for tax years ending Dec. 31, 2009 for the PPRT.