Illinois Now Requires Trusts, Estates And Other Pass-Through Entities To Withhold Nonresident Beneficiaries’ Share Of Illinois Income Tax

Karin Prangley (Attorney, Krasnow Saunders Cornblath LLP) has written an article about changes to the Illinois tax code that affect trusts in the state.

Here is a short summary of the article:

Illinois joins the ranks of approximately a dozen other states by requiring trusts and other pass-through entities to directly pay a nonresident beneficiary’s share of Illinois state income tax. The Illinois Department of Revenue recently announced in an Informational Bulletin that effective for tax years ending on or after December 31, 2008, pass-through entities (trusts, estates, S corporations, partnerships and LLCs taxed as partnerships) must make Illinois state income tax payments on the entity’s Illinois business income on behalf of each nonresident shareholder, partner or beneficiary.