2015 - 2016 LEGISLATURE
February 23, 2015 - Introduced by Representatives Kooyenga, Genrich, Macco,
Johnson, Goyke, Knudson, Sanfelippo, Subeck, Kleefisch, C. Taylor, Kulp,
Kolste, Quinn, Knodl, Hesselbein, Barca, Berceau, Kremer, Zamarripa,
Spreitzer and Hintz, cosponsored by Senators Darling,
and Olsen. Referred to Committee on Financial Institutions.
1An Act to amend
183.0103 (1), 183.0103 (3), 183.0202 (2), 183.09025 (4) (a) 3. 2
and 183.1005; and to create
183.0202 (7) and subchapter XIV of chapter 183 3
[precedes 183.1401] of the statutes;
relating to: creation of a category of
4limited liability company identified as a low-profit limited liability company.
Analysis by the Legislative Reference Bureau
This bill allows an entity operated for profit and organized as a limited liability
company (LLC) to become a low-profit LLC by stating in its articles of organization
that it is a low-profit LLC. However, to qualify as a low-profit LLC, an LLC must
significantly further the accomplishment of one or more charitable or educational
purposes, cannot have the production of income or appreciation of property as its
primary purpose, and cannot have any political or legislative purpose. In general,
provisions of law applicable to LLCs also apply to low-profit LLCs, although one of
the permissible identifiers in the name of a low-profit LLC is "L3C" instead of "LLC."
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
183.0103 (1) of the statutes is amended to read:
183.0103 (1) The Except as provided in s. 183.1402, the
name of a limited 7
liability company as set forth in its articles of organization must contain the words
"limited liability company" or "limited liability co." or end with the abbreviation 2
"L.L.C." or "LLC". The name may not contain language stating or implying that the 3
limited liability company is organized for any purpose other than that permitted 4
under s. 183.0106 (1).
183.0103 (3) of the statutes is amended to read:
The name of a limited liability company is not distinguishable 7
from a name referred to in sub. (2) (a) to (c) if the only difference between it and the 8
other name is the inclusion or absence of a word or words referred to in sub. (1) or
or of the words "corporation", "incorporated", "limited", "company", 10
"limited partnership", "limited liability partnership" or "cooperative" or an 11
abbreviation of these words.
183.0202 (2) of the statutes is amended to read:
A name for the limited liability company that satisfies s. 183.0103 14and, if applicable, s. 183.1402
183.0202 (7) of the statutes is created to read:
If applicable, the statements under s. 183.1403 (2).
183.09025 (4) (a) 3. of the statutes is amended to read:
(a) 3. A statement that the limited liability company's name 19
satisfies s. 183.0103 and, if applicable, s. 183.1402
183.1005 of the statutes is amended to read:
A certificate of registration may not be issued to a foreign 22
limited liability company unless its name satisfies s. 183.0103 (1) and (2) and, if
23applicable, s. 183.1402
. If the name under which a foreign limited liability company 24
is registered in the jurisdiction of its formation does not satisfy s. 183.0103 (1) and 25
(2) and, if applicable, s. 183.1402
, the foreign limited liability company may obtain
a certificate of registration to transact business in this state under a fictitious name 2
that is available and that satisfies s. 183.0103 (1) and (2) and, if applicable, s.
Subchapter XIV of chapter 183 [precedes 183.1401] of the statutes 5
is created to read:
In this subchapter, "low-profit limited liability 11
company" means a limited liability company that is operated for profit and that 12
satisfies the requirements under s. 183.1403.
The name of a low-profit limited liability company as set 14
forth in its articles of organization must contain the words "low-profit limited 15
liability company" or "low-profit limited liability co." or end with the abbreviation 16
17183.1403 Requirements. (1)
To qualify as a low-profit limited liability 18
company under this subchapter, a limited liability company shall at all times 19
significantly further the accomplishment of one or more charitable or educational 20
purposes within the meaning of section 170
(c) (2) (B) of the Internal Revenue Code.
To qualify as a low-profit limited liability company under this subchapter, 22
a limited liability company shall state in its articles of organization all of the 23
(a) That it is a low-profit limited liability company.
(b) That the production of income or appreciation of property is not its primary 2
(c) That it has no purpose to accomplish any political or legislative purpose 4
within the meaning of section 170
(c) (2) (D) of the Internal Revenue Code.
(a) Subject to par. (b), to qualify as a low-profit limited liability company 6
under this subchapter, a limited liability company's operations shall at all times be 7
consistent with the statements in sub. (2) (b) and (c).
(b) The fact that a limited liability company produces significant income or 9
capital appreciation is not, in the absence of other factors, conclusive evidence that 10
the limited liability company has as its primary purpose the production of income or 11
appreciation of property.
(c) The operating agreement of a low-profit limited liability company may not 13
eliminate or reduce the obligations or purposes of the low-profit limited liability 14
company under this section.
Except as otherwise provided in this subchapter, all provisions of this 16
chapter applicable to domestic limited liability companies are applicable to 17
low-profit limited liability companies.
18183.1404 Additional duty. (1)
In addition to the duties under s. 183.0402, 19
a member or manager of a low-profit limited liability company shall discharge his 20
or her duties relating to the obligations and purposes of the low-profit limited 21
liability company under s. 183.1403 (2) (b) and (c) with the degree of diligence, care, 22
and skill that an ordinarily prudent person would exercise under similar 23
The operating agreement of a low-profit limited liability company may not 25
eliminate or reduce the duty imposed under sub. (1).
1183.1405 Ceasing to operate as a low-profit limited liability company. 2
A low-profit limited liability company that ceases to meet any of the requirements 3
under s. 183.1403 ceases to qualify as a low-profit limited liability company and 4
shall promptly amend its articles of organization to remove the statements specified 5
in s. 183.1403 (2) and amend its name consistent with s. 183.0103.
This act takes effect on the 90th day after the day of publication.