760 ILCS 55/ Charitable Trust Act.

(760 ILCS 55/1) (from Ch. 14, par. 51)

Sec. 1. This Act may be cited as the Charitable Trust Act.

(Source: P.A. 102-558, eff. 8-20-21.)

(760 ILCS 55/2) (from Ch. 14, par. 52)

Sec. 2. This Act applies to any and all trustees, as defined in Section 3, holding property of a value in excess of $4,000.

(Source: P.A. 90-469, eff. 8-17-97.)

(760 ILCS 55/3) (from Ch. 14, par. 53)

Sec. 3. "Trustee" means any person, individual, group of individuals, association, corporation, not-for-profit corporation, estate representative, or other legal entity holding property for or solicited for any charitable purpose; or any chief operating officer, director, executive director or owner of a corporation soliciting or holding property for a charitable purpose.

(Source: P.A. 90-469, eff. 8-17-97.)

(760 ILCS 55/4) (from Ch. 14, par. 54)

Sec. 4. (a) This Act does not apply to the United States, any State, territory or possession of the United States, the District of Columbia, the Commonwealth of Puerto Rico, or to any of their agencies or to any governmental subdivision; or to a corporation sole, or other religious corporation, trust or organization which holds property for religious, charitable, hospital or educational purposes or for the purpose of operating cemeteries or a home or homes for the aged; nor to any agency or organization, incorporated or unincorporated, affiliated with and directly supervised by such a religious corporation or organization; or to an officer, director or trustee of any such religious corporation, trust or organization who holds property in his official capacity for like purposes; or to a charitable organization foundation, trust or corporation organized for the purpose of and engaged in the operation of schools or hospitals.

(b) As an alternative means of satisfying the duties and obligations otherwise imposed by this Act, any veterans organization chartered or incorporated under federal law and any veterans organization which is affiliated with and recognized in the bylaws of a congressionally chartered or incorporated veterans organization may register with the Attorney General as provided in Section 5 of this Act and comply with the filing requirements set forth in subsection (d) of Section 4 of the Solicitation for Charity Act.

(c) Any person who would be subject to the provisions of Section 2 of this Act solely by virtue of acting as agent in receiving, collecting, holding or transporting used or second hand personal property for a charitable organization, a veterans organization or an affiliate as described in subsection (b) shall be relieved of all duties and obligations otherwise imposed by this Act upon filing with the Attorney General the documents required under subsection (e) of Section 4 of the Solicitation for Charity Act.

(Source: P.A. 87-755.)

(760 ILCS 55/5) (from Ch. 14, par. 55)

Sec. 5. Registration requirement.

(a) The Attorney General shall establish and maintain a register of trustees subject to this Act and of the particular trust or other relationship under which they hold property for charitable purposes and, to that end, shall conduct whatever investigation is necessary, and shall obtain from public records, court officers, taxing authorities, trustees and other sources, copies of instruments, reports and records and whatever information is needed for the establishment and maintenance of the register.

(b) A registration statement shall be signed and verified under penalty of perjury by 2 officers of a corporate charitable organization or by 2 trustees if not a corporate organization. One signature will be accepted if there is only one officer or one trustee. A registration fee of $15 shall be paid with each initial registration. If a person, trustee or organization fails to maintain a registration of a trust or organization as required by this Act, and its registration is cancelled as provided in this Act, and if that trust or organization remains in existence and by law is required to be registered, in order to re-register, a new registration must be filed accompanied by required financial reports, and in all instances where re-registration is required, submitted, and allowed, the new re-registration materials must be filed, accompanied by a re-registration fee of $200.

(c) If a person or trustee fails to register or maintain registration of a trust or organization or fails to file reports as provided in this Act, the person or trustee is subject to injunction, to removal, to account, and to appropriate other relief before a court of competent jurisdiction exercising chancery jurisdiction. In the event of such action, the court may impose a civil penalty of not less than $500 nor more than $1,000 against the organization or trust estate that failed to register or to maintain a registration required under this Act. The collected penalty shall be used for charitable trust enforcement and for providing charitable trust information to the public.

(Source: P.A. 97-813, eff. 7-13-12.)

(760 ILCS 55/5A) (from Ch. 14, par. 55A)

Sec. 5A. Organizations that have been approved for participation under the Voluntary Payroll Deductions Act of 1983 shall be reported to the Attorney General by the Comptroller no later than May 1 of each year.

(Source: P.A. 87-755.)

(760 ILCS 55/6) (from Ch. 14, par. 56)

Sec. 6. (a) Every trustee subject to this Act who has received property for charitable purposes shall file and register with the Attorney General, within 6 months after any part of the income or principal is received for application to the charitable purpose, and prior to disbursements, a copy of the trust agreement, articles of incorporation or other written instrument, if any, providing for his title, powers or duties. In the event a trustee subject to this Act is holding property for charitable purposes under no such written instrument, such trustee nevertheless shall file, in lieu of such instrument, a statement in writing setting forth his title, powers and duties with respect to the property he is so holding. If any part of the income or principal is authorized or required to be applied to a charitable purpose, whether a remainder interest or charitable lead interest, at the time this Act takes effect, the filing shall be made within 6 months after the effective date of this Act. Upon complying with the requirement of this Section, banks and trust companies, authorized to accept and execute trusts in this State, and an individual or individuals duly appointed, qualified and acting as cofiduciary or cofiduciaries with any such bank or trust company, shall be exempt from all other provisions and requirements of this Act, but shall be required to annually file a copy of the federal Internal Revenue report or return for the trust within the time of its federal due date, with the Attorney General in lieu of other reporting.

(b) If the settlor is still living, any trust which is merely registered because it is a charitable remainder interest or charitable lead interest trust, and the charitable interest is not matured, whether revocable or irrevocable, the trust may upon written request be registered as a confidential registration. A confidential registration shall mean the Attorney General shall hold the file confidentially and not make any filings therein public, unless necessary and pursuant to litigation. The Attorney General may, however, disclose a confidential registration file for statistical reasons if all indications of name and identity are blocked out, but at all times maintaining the confidentiality as required in this subsection.

(Source: P.A. 87-755.)

(760 ILCS 55/7) (from Ch. 14, par. 57)

Sec. 7. (a) Except as otherwise provided, every trustee subject to this Act shall, in addition to filing copies of the instruments previously required, file with the Attorney General periodic annual written reports under oath, setting forth information as to the nature of the assets held for charitable purposes and the administration thereof by the trustee, in accordance with rules and regulations of the Attorney General.

(b) The Attorney General shall make rules and regulations as to the time for filing reports, the contents thereof, and the manner of executing and filing them. He may classify trusts and other relationships concerning property held for a charitable purpose as to purpose, nature of assets, duration of the trust or other relationship, amount of assets, amounts to be devoted to charitable purposes, nature of trustee, or otherwise, and may establish different rules for the different classes as to time and nature of the reports required to the ends (1) that he shall receive reasonably current, annual reports as to all charitable trusts or other relationships of a similar nature, which will enable him to ascertain whether they are being properly administered, and (2) that periodic reports shall not unreasonably add to the expense of the administration of charitable trusts and similar relationships. The Attorney General may suspend the filing of reports as to a particular charitable trust or relationship for a reasonable, specifically designated time upon written application of the trustee filed with the Attorney General and after the Attorney General has filed in the register of charitable trusts a written statement that the interests of the beneficiaries will not be prejudiced thereby and that periodic reports are not required for proper supervision by his office.

(c) A copy of an account filed by the trustee in any court having jurisdiction of the trust or other relationship, if the account has been approved by the court in which it was filed and notice given to the Attorney General as an interested party, may be filed as a report required by this Section.

(d) The first report for a trust or similar relationship hereafter established, unless the filing thereof is suspended as herein provided, shall be filed not later than one year after any part of the income or principal is authorized or required to be applied to a charitable purpose. If any part of the income or principal of a trust previously established is authorized or required to be applied to a charitable purpose at the time this Act takes effect, the first report, unless the filing thereof is suspended, shall be filed within 6 months after the effective date of this Act. In addition, every trustee registered hereunder that received more than $25,000 in revenue during a trust fiscal year or has possession of more than $25,000 of assets at any time during a fiscal year shall file an annual financial report within 6 months of the close of the trust's or organization's fiscal year, and if a calendar year the report shall be due on each June 30 of the following year. Every trustee registered hereunder that did not receive more than $25,000 in revenue or hold more than $25,000 in assets during a fiscal year shall file only a simplified summary financial statement disclosing only the gross receipts, total disbursements, and assets on hand at the end of the year, on forms prescribed by the Attorney General.

(e) The periodic reporting provisions of this Act do not apply to any trustee of a trust which is the subject matter of an adversary proceeding pending in the circuit court in this State. However, upon commencement of the proceeding the trustee shall file a report with the Attorney General informing him of that fact together with the title and number of the cause and the name of the court. Upon entry of final judgment in the cause the trustee shall in like manner report that fact to the Attorney General and fully account for all periods of suspension.

(f) The Attorney General in his discretion may, pursuant to rules and regulations promulgated by the Attorney General, accept executed copies of federal Internal Revenue returns and reports as a portion of the annual reporting. The report shall include a statement of any changes in purpose or any other information required to be contained in the registration form filed on behalf of the organization. The report shall be signed under penalty of perjury by the president and the chief fiscal officer of any corporate organization or by 2 trustees if not a corporation. One signature shall be accepted if there is only one officer or trustee.

(g) The Attorney General shall cancel the registration of any trust or organization that wilfully fails to comply with subsections (a), (b), (c) or (d) of this Section within the time prescribed, and the assets of the organization may through court proceedings be collected, debts paid and proceeds distributed under court supervision to other charitable purposes upon an action filed by the Attorney General as law and equity allow. Upon timely written request, the due date for filing may be extended by the Attorney General for a period of 60 days. Notice of registration cancellation shall be mailed by regular mail to the registrant at the registration file address or to its registered agent or president 21 days before the effective date of the cancellation. Reports submitted after registration is canceled shall require reregistration.

(h) Every trustee registered hereunder that received in any fiscal year more than $25,000 in revenue or held more than $25,000 in assets shall pay a fee of $15 along with each annual financial report filed pursuant to this Act. If an annual report is not timely filed, a late filing fee of an additional $100 is imposed and shall be paid as a condition of filing a late report. Reports submitted without the proper fee shall not be accepted for filing.

(Source: P.A. 90-469, eff. 8-17-97; 91-444, eff. 8-6-99.)

(760 ILCS 55/7.5)

Sec. 7.5. Charitable trust for the benefit of a minor or person with a disability; report.

(a) In the case of a charitable trust established for the benefit of a minor or person with a disability, the person or trustee responsible for the trust, if not the guardian or parent, shall report its existence by certified or registered United States mail to the parent or guardian of the minor or person with a disability within 30 days after formation of the trust and every 6 months thereafter. The written report shall include the name and address of the trustee or trustees responsible for the trust, the name and address of the financial institution at which funds for the trust are held, the amount of funds raised for the trust, and an itemized list of expenses for administration of the trust.

The guardian of the estate of the minor or person with a disability shall report the existence of the trust as part of the ward's estate to the court that appointed the guardian as part of its responsibility to manage the ward's estate as established under Section 11-13 of the Probate Act of 1975. Compliance with this Section in no way affects other requirements for trustee registration and reporting under this Act or any accountings or authorizations required by the court handling the ward's estate.

(b) If a person or trustee fails to report the existence of the trust to the minor's parent or guardian or to the parent or guardian of the person with a disability as required in this Section, the person or trustee is subject to injunction, to removal, to account, and to other appropriate relief before a court of competent jurisdiction exercising chancery jurisdiction.

(c) For the purpose of this Section, a charitable trust for the benefit of a minor or person with a disability is a trust, including a special needs trust, that receives funds solicited from the public under representations that such will (i) benefit a needy minor or person with a disability, (ii) pay the medical or living expenses of the minor or person with a disability, or (iii) be used to assist in family expenses of the minor or person with a disability.

(d) Each and every trustee of a charitable trust for the benefit of a minor or person with a disability must register under this Act and in addition must file an annual report as required by Section 7 of this Act.

(Source: P.A. 99-143, eff. 7-27-15.)

(760 ILCS 55/8) (from Ch. 14, par. 58)

Sec. 8. The Attorney General may make additional rules and regulations necessary for the administration of this Act.

(Source: Laws 1961, p. 2094.)

(760 ILCS 55/9) (from Ch. 14, par. 59)

Sec. 9. The Attorney General may investigate transactions and relationships of trustees subject to this Act for the purpose of determining whether the property held for charitable purposes is properly administered. He may require any agent, trustee, fiduciary, beneficiary, institution, association, or corporation, or other person to appear, at a named time and place, in the county designated by the Attorney General, where the person resides or is found, to give information under oath and to produce books, memoranda, papers, documents of title and evidence of assets, liability, receipts, or disbursements in the possession or control of the person ordered to appear.

(Source: Laws 1961, p. 2094.)

(760 ILCS 55/10) (from Ch. 14, par. 60)

Sec. 10. When the Attorney General requires the attendance of any person, as provided in Section 9, he shall issue an order setting forth the time when and the place where attendance is required and shall cause the same to be served upon the person in the manner provided for service of process in civil cases at least 14 days before the date fixed for attendance. Such order shall have the same force and effect as a subpoena and, upon application of the Attorney General, obedience to the order may be enforced by the circuit court in the county where the person receiving it resides or is found, in the same manner as though the notice were a subpoena. Such court may, in case of contumacy or refusal to obey the order issued by the Attorney General, issue an order requiring such person to appear before the Attorney General or to produce documentary evidence, if so ordered, or to give evidence touching the matter in question, and any failure to obey such order of the court may be punished by that court as a contempt upon itself. The investigation or hearing may be made by or before any Assistant Attorney General designated in writing by the Attorney General to conduct such investigation or hearing on his behalf. Witnesses ordered to appear shall be paid the same fees and mileage as are paid witnesses in the circuit courts of this State, and witnesses whose depositions are taken and the persons taking the same shall severally be entitled to the same fees as are paid for like services in the circuit courts of this State. The Attorney General or the Assistant Attorney General acting in his behalf is empowered to administer the necessary oath or affirmation to such witnesses.

(Source: P.A. 79-1361.)

(760 ILCS 55/11) (from Ch. 14, par. 61)

Sec. 11. Subject to reasonable rules and regulations adopted by the Attorney General, the register, copies of instruments and reports filed with the Attorney General shall be open to public inspection.

(Source: Laws 1961, p. 2094.)

(760 ILCS 55/12) (from Ch. 14, par. 62)

Sec. 12. The Attorney General may institute appropriate proceedings to secure compliance with this Act and to secure the proper administration of any trust or other relationship to which this Act applies. Venue shall be proper in any county where the Attorney General accepts and maintains the list of registrations. In furtherance of judicial economy, actions filed for violation of this Act may name multiple trustees, trusts, and organizations in a joint action where each has engaged in similar conduct in violation of this Act or where similar relief is sought against those defendants for violation of this Act.

(Source: P.A. 90-469, eff. 8-17-97.)

(760 ILCS 55/13) (from Ch. 14, par. 63)

Sec. 13. This Act shall apply regardless of any contrary provisions of any instrument.

(Source: Laws 1961, p. 2094.)

(760 ILCS 55/14) (from Ch. 14, par. 64)

Sec. 14. If any provision of this Act or the application thereof to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

(Source: Laws 1961, p. 2094.)

(760 ILCS 55/15) (from Ch. 14, par. 65)

Sec. 15. (a) Charitable trustees are subject to certain duties otherwise defined in Illinois statutes and case law, which include but are not limited to the following:

(1) To avoid "self-dealing" and conflicts of interest;

(2) To avoid wasting charitable assets;

(3) To avoid incurring penalties, fines, and unnecessary taxes;

(4) To adhere and conform the charitable organization to its charitable purpose;

(5) To not make non-program loans, gifts, or advances to any person, except as allowed by the General Not For Profit Corporation Act of 1986;

(6) To utilize the trust in conformity with its purposes for the best interest of the beneficiaries;

(7) To timely file registration and financial reports required by this Act; and

(8) To comply and to cause the charitable organization to comply with this Act and, if incorporated, the General Not For Profit Corporation Act of 1986.

(b) Every person subject to this Act shall maintain accurate and detailed books and records at the principal office of the organization to provide the information required in this Act. All books and records shall be open for inspection at all reasonable times by the Attorney General or his authorized representative.

(Source: P.A. 87-755.)

(760 ILCS 55/15.5)

Sec. 15.5. Termination and transfer of certain trusts.

(a) If a trustee who is subject to this Act determines that the continued administration of a trust has become impractical because of the trust's small size or because of changed circumstances that adversely affect the charitable purpose or purposes of the trust, then after notifying each named charitable organization, if any, for the benefit of which the trust was created and after obtaining the consent of the Attorney General, the trustee may amend the terms of the governing instrument of the trust to the extent necessary to terminate the trust and to transfer the trust assets as provided in subsection (c) or (d). The Attorney General shall consent to the termination of the trust and the transfer of the trust assets only after having determined that the termination and transfer are necessary or appropriate, in the case of termination because of the trust's small size, to implement the charitable purpose or purposes of the trust or, in the case of termination because of changed circumstances, to fulfill the general intent of the donor of the trust as expressed in the governing instrument of the trust.

(b) For purposes of subsection (a), the term "small size" shall mean a trust for which the annual expenses of administration, including the trustee's fees, the investment management and accounting fees and excise taxes would, if charged entirely against income, exceed 25% of the income of the trust, and the term "changed circumstances" shall mean a condition in which the charitable purpose or purposes of the trust shall, in the judgment of the trustee, have become illegal, unnecessary, incapable of fulfillment, or inconsistent with the charitable needs of the community.

(c) Subject to subsection (d) with respect to a trust terminated because of the trust's small size, the trustee shall transfer the trust assets of the terminated trust to a community foundation or similar publicly-supported organization described in Section 170 (b)(1)(A)(vi) of the Internal Revenue Code of 1986, to be administered, in the case of termination because of the trust's small size, in implementation of the charitable purpose or purposes of the trust or, in the case of termination because of changed circumstances, in accordance with the general intent of the donor of the trust as expressed in the governing instrument of the trust.

(d) If a trust terminated because of the trust's small size was created for the benefit of a named charitable organization which has established an endowment fund and if the principal of the endowment fund is under its irrevocable terms no more expendable by the organization than is the principal of the trust under the terms of the governing instrument of the trust, the charitable organization may direct the trustee to transfer the trust assets of the trust to the endowment fund, to be administered in implementation of the charitable purpose or purposes of the trust.

(e) A trustee need not obtain the approval of any court in order to terminate a trust and to transfer the trust assets as provided in this Section.

(f) The provisions of this Section are an alternative to and not in abrogation of any other course of action provided by law. A trustee shall not incur any civil or criminal liability by reason of acting in accordance with this Section.

(Source: P.A. 89-575, eff. 1-1-97.)

(760 ILCS 55/16) (from Ch. 14, par. 66)

Sec. 16. (a) Any person who, intentionally and in breach of fiduciary duty with malice, misuses charitable assets is subject to punitive damages in an appropriate amount upon a trial on the issue.

(b) Upon an application to the chancery division of the circuit court in which the Attorney General alleges that a charitable trust needs to be protected or the trustees of a charitable organization or trust have engaged in a breach of fiduciary duty toward the organization, and injunctive relief and removal of the trustees is sought, the Court shall exercise its discretion as the equities require and may, as part of the injunctive relief, and after a hearing where the trustees shall have an opportunity to be heard, appoint temporarily or permanently a receiver or additional trustees to protect and operate the organization and may temporarily, or as ultimate relief for breach of duty or to protect the trust, permanently remove any charitable organization's trustees, corporate officers, directors and members from office and appoint replacements to protect the public interest.

(Source: P.A. 87-755.)

(760 ILCS 55/16.5)

Sec. 16.5. Terrorist acts.

(a) Any person or organization subject to registration under this Act, who knowingly acts to further, directly or indirectly, or knowingly uses charitable assets to conduct or further, directly or indirectly, an act or actions as set forth in Article 29D of the Criminal Code of 2012, is thereby engaged in an act or actions contrary to public policy and antithetical to charity, and all of the funds, assets, and records of the person or organization shall be subject to temporary and permanent injunction from use or expenditure and the appointment of a temporary and permanent receiver to take possession of all of the assets and related records.

(b) An ex parte action may be commenced by the Attorney General, and, upon a showing of probable cause of a violation of this Section or Article 29D of the Criminal Code of 2012, an immediate seizure of books and records by the Attorney General by and through his or her assistants or investigators or the Illinois State Police and freezing of all assets shall be made by order of a court to protect the public, protect the assets, and allow a full review of the records.

(c) Upon a finding by a court after a hearing that a person or organization has acted or is in violation of this Section, the person or organization shall be permanently enjoined from soliciting funds from the public, holding charitable funds, or acting as a trustee or fiduciary within Illinois. Upon a finding of violation all assets and funds held by the person or organization shall be forfeited to the People of the State of Illinois or otherwise ordered by the court to be accounted for and marshaled and then delivered to charitable causes and uses within the State of Illinois by court order.

(d) A determination under this Section may be made by any court separate and apart from any criminal proceedings and the standard of proof shall be that for civil proceedings.

(e) Any knowing use of charitable assets to conduct or further, directly or indirectly, an act or actions set forth in Article 29D of the Criminal Code of 2012 shall be a misuse of charitable assets and breach of fiduciary duty relative to all other Sections of this Act.

(Source: P.A. 102-538, eff. 8-20-21.)

(760 ILCS 55/17) (from Ch. 14, par. 67)

Sec. 17. Any trustee who with malice and without lawful authority, in violation of the trust purposes or by intentional breach of fiduciary duty, intentionally disburses or causes charitable trust funds to be used for his personal benefit or personal use in an amount in excess of $1,000 within a 5 year period is guilty of a Class 2 felony and is subject to punitive damages up to or equal to the amount misused and is subject to a civil penalty of up to $50,000 for each intentional knowing violation.

(Source: P.A. 87-755.)

(760 ILCS 55/18) (from Ch. 14, par. 68)

Sec. 18. All copies of registration materials or financial documents filed with the Attorney General pursuant to the provisions of this Act shall, when certified by him or by his designated Assistant Attorney General, be taken and received in all courts, public offices and official bodies as business records of the filer.

(Source: P.A. 87-755.)

(760 ILCS 55/19) (from Ch. 14, par. 69)

Sec. 19. There is created in the State Treasury the Illinois Charity Bureau Fund. All fees and penalties collected by the Attorney General pursuant to this Act shall be deposited in the Illinois Charity Bureau Fund in the State Treasury. Moneys in the Fund shall be appropriated to the Attorney General for charitable trust enforcement purposes and dissemination of public information.

(Source: P.A. 90-469, eff. 8-17-97.)