LRB-1511/1
ARG:wlj:rs
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, Wanggaard, Hansen
and Olsen. Referred to Committee on Financial Institutions.
AB60,1,4 1An Act to amend 183.0103 (1), 183.0103 (3), 183.0202 (2), 183.09025 (4) (a) 3.
2and 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:
AB60,1 5Section 1. 183.0103 (1) of the statutes is amended to read:
AB60,2,46 183.0103 (1) The Except as provided in s. 183.1402, the name of a limited
7liability company as set forth in its articles of organization must contain the words

1"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
3limited liability company is organized for any purpose other than that permitted
4under s. 183.0106 (1).
AB60,2 5Section 2. 183.0103 (3) of the statutes is amended to read:
AB60,2,116 183.0103 (3) The name of a limited liability company is not distinguishable
7from a name referred to in sub. (2) (a) to (c) if the only difference between it and the
8other name is the inclusion or absence of a word or words referred to in sub. (1) or
9s. 183.1402
or of the words "corporation", "incorporated", "limited", "company",
10"limited partnership", "limited liability partnership" or "cooperative" or an
11abbreviation of these words.
AB60,3 12Section 3. 183.0202 (2) of the statutes is amended to read:
AB60,2,1413 183.0202 (2) A name for the limited liability company that satisfies s. 183.0103
14and, if applicable, s. 183.1402.
AB60,4 15Section 4. 183.0202 (7) of the statutes is created to read:
AB60,2,1616 183.0202 (7) If applicable, the statements under s. 183.1403 (2).
AB60,5 17Section 5. 183.09025 (4) (a) 3. of the statutes is amended to read:
AB60,2,1918 183.09025 (4) (a) 3. A statement that the limited liability company's name
19satisfies s. 183.0103 and, if applicable, s. 183.1402.
AB60,6 20Section 6. 183.1005 of the statutes is amended to read:
AB60,3,3 21183.1005 Name. A certificate of registration may not be issued to a foreign
22limited 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
24is 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

1a certificate of registration to transact business in this state under a fictitious name
2that is available and that satisfies s. 183.0103 (1) and (2) and, if applicable, s.
3183.1402
.
AB60,7 4Section 7. Subchapter XIV of chapter 183 [precedes 183.1401] of the statutes
5is created to read:
AB60,3,66 Chapter 183
AB60,3,97 Subchapter XIV
8 low-profit limited
9 liability companies
AB60,3,12 10183.1401 Definition. In this subchapter, "low-profit limited liability
11company" means a limited liability company that is operated for profit and that
12satisfies the requirements under s. 183.1403.
AB60,3,16 13183.1402 Name. The name of a low-profit limited liability company as set
14forth in its articles of organization must contain the words "low-profit limited
15liability company" or "low-profit limited liability co." or end with the abbreviation
16"L3C".
AB60,3,20 17183.1403 Requirements. (1) To qualify as a low-profit limited liability
18company under this subchapter, a limited liability company shall at all times
19significantly further the accomplishment of one or more charitable or educational
20purposes within the meaning of section 170 (c) (2) (B) of the Internal Revenue Code.
AB60,3,23 21(2) To qualify as a low-profit limited liability company under this subchapter,
22a limited liability company shall state in its articles of organization all of the
23following:
AB60,3,2424 (a) That it is a low-profit limited liability company.
AB60,4,2
1(b) That the production of income or appreciation of property is not its primary
2purpose.
AB60,4,43 (c) That it has no purpose to accomplish any political or legislative purpose
4within the meaning of section 170 (c) (2) (D) of the Internal Revenue Code.
AB60,4,7 5(3) (a) Subject to par. (b), to qualify as a low-profit limited liability company
6under this subchapter, a limited liability company's operations shall at all times be
7consistent with the statements in sub. (2) (b) and (c).
AB60,4,118 (b) The fact that a limited liability company produces significant income or
9capital appreciation is not, in the absence of other factors, conclusive evidence that
10the limited liability company has as its primary purpose the production of income or
11appreciation of property.
AB60,4,1412 (c) The operating agreement of a low-profit limited liability company may not
13eliminate or reduce the obligations or purposes of the low-profit limited liability
14company under this section.
AB60,4,17 15(4) Except as otherwise provided in this subchapter, all provisions of this
16chapter applicable to domestic limited liability companies are applicable to
17low-profit limited liability companies.
AB60,4,23 18183.1404 Additional duty. (1) In addition to the duties under s. 183.0402,
19a member or manager of a low-profit limited liability company shall discharge his
20or her duties relating to the obligations and purposes of the low-profit limited
21liability company under s. 183.1403 (2) (b) and (c) with the degree of diligence, care,
22and skill that an ordinarily prudent person would exercise under similar
23circumstances.
AB60,4,25 24(2) The operating agreement of a low-profit limited liability company may not
25eliminate or reduce the duty imposed under sub. (1).
AB60,5,5
1183.1405 Ceasing to operate as a low-profit limited liability company.
2A low-profit limited liability company that ceases to meet any of the requirements
3under s. 183.1403 ceases to qualify as a low-profit limited liability company and
4shall promptly amend its articles of organization to remove the statements specified
5in s. 183.1403 (2) and amend its name consistent with s. 183.0103.
AB60,8 6Section 8. Effective date.
AB60,5,77 (1) This act takes effect on the 90th day after the day of publication.
AB60,5,88 (End)
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