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90_HB3387 305 ILCS 5/12-4.103 new Amends the Illinois Public Aid Code. Provides that the Department of Human Services shall administer a program that allows eligible low-income individuals to maintain Individual Development Accounts with money from employment earnings to enable the individual to accumulate funds for postsecondary education, to purchase a first home, or to finance business capitalization expenses. Provides that the funds in the account shall be matched by a not-for-profit organization or by a State or local governmental agency acting in cooperation with a not-for-profit organization. Provides that the Department may match a set percentage of contributions made by the eligible individuals who have established Individual Development Accounts and make grants to not-for-profit organizations to administer the accounts. Provides that funds in an Individual Development Account shall be disregarded for the purpose of determining the eligibility and benefit levels under this Code. Effective immediately. LRB9009540SMdv LRB9009540SMdv 1 AN ACT to amend the Illinois Public Aid Code by adding 2 Section 12-4.103. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Illinois Public Aid Code is amended by 6 adding Section 12-4.103 as follows: 7 (305 ILCS 5/12-4.103 new) 8 Sec. 12-4.103. Individual Development Accounts. The 9 Illinois Department shall establish and administer a program 10 that allows eligible low-income individuals to open and 11 maintain Individual Development Accounts for the purpose of 12 enabling the individual to accumulate funds for a qualified 13 purpose. A qualified purpose for establishing an Individual 14 Development Account shall be one or more of the following: 15 (1) to pay for postsecondary education expenses if the 16 expenses are paid directly to an eligible educational 17 institution; 18 (2) to acquire a principal residence if the individual is 19 buying a home for the first time and if the funds are paid 20 directly to the person to whom the amounts required for the 21 purchase are due; or 22 (3) to finance business capitalization expenses if the 23 funds are paid directly into a business capitalization 24 account at a federally insured financial institution and are 25 restricted to use solely for qualified business 26 capitalization expenses. 27 An individual may make contributions to his or her 28 Individual Development Account only from funds derived from 29 earned income as defined in Section 911(d)(2) of the Internal 30 Revenue Code of 1986. 31 An Individual Development Account established under this -2- LRB9009540SMdv 1 Section shall be a trust created or organized in the United 2 States and funded through periodic contributions by the 3 eligible low-income individual and matched by a 4 not-for-profit organization described in Section 501(c)(3) of 5 the Internal Revenue Code of 1986 and exempt from taxation 6 under Section 501(a) of such Code, or by a State or local 7 governmental agency acting in cooperation with a 8 not-for-profit organization as described herein. To the 9 extent resources permit in any particular fiscal year, the 10 Illinois Department may allocate general revenue funds for 11 the purpose of matching a set percentage of contributions 12 made by the eligible individuals who have established 13 Individual Development Accounts. 14 The Illinois Department shall review and consider for 15 approval proposals from the not-for-profit organizations 16 doing business with the State to establish Individual 17 Development Account programs. The Illinois Department shall 18 promulgate rules for the operation of such programs, 19 including standards for administration consistent with 20 applicable federal and State law. To the extent resources 21 are available the Illinois Department may, through a 22 request-for-proposal process, award grants to not-for-profit 23 organizations to cover all or part of the operating costs of 24 administering Individual Development Account programs or to 25 provide technical assistance to other not-for-profit 26 organizations seeking to establish Individual Development 27 Account programs. 28 Notwithstanding any other provision of State law, funds 29 in an Individual Development Account, including accrued 30 interest and matching deposits, shall be disregarded for the 31 purpose of determining the eligibility and benefit levels 32 under this Code of the individual establishing the Individual 33 Development Account with respect to any period during which 34 such individual maintains or makes contributions into such an -3- LRB9009540SMdv 1 account. 2 Section 99. Effective date. This Act takes effect upon 3 becoming law.
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