IL SB2430

Amends the Illinois Income Tax Act by modifying the definition of "investment partnership" to apply different standards based on tax year end dates (before and after January 1, 2021).

For tax years ending before January 1, 2021, requires investment partnerships to meet three criteria: at least 90% of assets in qualifying investment securities or bank deposits, at least 90% of gross income from interest/dividends/gains, and not being a dealer in qualifying investment securities.

For tax years ending on or after January 1, 2021, adds a fourth income source to the definition: distributive share of partnership income from lower-tier partnership interests that qualify as qualifying investment securities under Section 2(a)(1) of the federal Securities Act of 1933.

Expands the definition of "qualifying investment securities" for tax years ending on or after January 1, 2021 to include additional categories such as foreign currency deposits, mortgage-backed securities, derivatives, and certain partnership interests meeting federal securities law definitions.

Includes amendments to the definition of "captive real estate investment trust" establishing ownership thresholds, exclusions for certain types of REITs and foreign entities, and constructive ownership rules referencing Internal Revenue Code Section 318.