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90_SB1435
305 ILCS 5/12-4.103 new
Amends the Illinois Public Aid Code. Provides that the
Department of Human Services shall administer a program that
allows eligible low-income individuals to maintain Individual
Development Accounts with money from employment earnings to
enable the individual to accumulate funds for postsecondary
education, to purchase a first home, or to finance business
capitalization expenses. Provides that the funds in the
account shall be matched by a not-for-profit organization or
by a State or local governmental agency acting in cooperation
with a not-for-profit organization. Provides that the
Department may match a set percentage of contributions made
by the eligible individuals who have established Individual
Development Accounts and make grants to not-for-profit
organizations to administer the accounts. Provides that
funds in an Individual Development Account shall be
disregarded for the purpose of determining the eligibility
and benefit levels under this Code. Effective immediately.
LRB9009541SMdv
LRB9009541SMdv
1 AN ACT to amend the Illinois Public Aid Code by adding
2 Section 12-4.103.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Public Aid Code is amended by
6 adding Section 12-4.103 as follows:
7 (305 ILCS 5/12-4.103 new)
8 Sec. 12-4.103. Individual Development Accounts. The
9 Illinois Department shall establish and administer a program
10 that allows eligible low-income individuals to open and
11 maintain Individual Development Accounts for the purpose of
12 enabling the individual to accumulate funds for a qualified
13 purpose. A qualified purpose for establishing an Individual
14 Development Account shall be one or more of the following:
15 (1) to pay for postsecondary education expenses if the
16 expenses are paid directly to an eligible educational
17 institution;
18 (2) to acquire a principal residence if the individual is
19 buying a home for the first time and if the funds are paid
20 directly to the person to whom the amounts required for the
21 purchase are due; or
22 (3) to finance business capitalization expenses if the
23 funds are paid directly into a business capitalization
24 account at a federally insured financial institution and are
25 restricted to use solely for qualified business
26 capitalization expenses.
27 An individual may make contributions to his or her
28 Individual Development Account only from funds derived from
29 earned income as defined in Section 911(d)(2) of the Internal
30 Revenue Code of 1986.
31 An Individual Development Account established under this
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1 Section shall be a trust created or organized in the United
2 States and funded through periodic contributions by the
3 eligible low-income individual and matched by a
4 not-for-profit organization described in Section 501(c)(3) of
5 the Internal Revenue Code of 1986 and exempt from taxation
6 under Section 501(a) of such Code, or by a State or local
7 governmental agency acting in cooperation with a
8 not-for-profit organization as described herein. To the
9 extent resources permit in any particular fiscal year, the
10 Illinois Department may allocate general revenue funds for
11 the purpose of matching a set percentage of contributions
12 made by the eligible individuals who have established
13 Individual Development Accounts.
14 The Illinois Department shall review and consider for
15 approval proposals from the not-for-profit organizations
16 doing business with the State to establish Individual
17 Development Account programs. The Illinois Department shall
18 promulgate rules for the operation of such programs,
19 including standards for administration consistent with
20 applicable federal and State law. To the extent resources
21 are available the Illinois Department may, through a
22 request-for-proposal process, award grants to not-for-profit
23 organizations to cover all or part of the operating costs of
24 administering Individual Development Account programs or to
25 provide technical assistance to other not-for-profit
26 organizations seeking to establish Individual Development
27 Account programs.
28 Notwithstanding any other provision of State law, funds
29 in an Individual Development Account, including accrued
30 interest and matching deposits, shall be disregarded for the
31 purpose of determining the eligibility and benefit levels
32 under this Code of the individual establishing the Individual
33 Development Account with respect to any period during which
34 such individual maintains or makes contributions into such an
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1 account.
2 Section 99. Effective date. This Act takes effect upon
3 becoming law.