Monday January 05, 2026
What is the Illinois Not-For-Profit Corporation Act?
The Illinois Not-For-Profit Corporation Act of 1986 is the main state law that governs how not-for-profit (nonprofit) corporations are created, organized, operated, and dissolved in Illinois. It’s found in the Illinois Compiled Statutes at 805 ILCS 105.
This article is not intended to and does not constitute legal advice or create an attorney-client relationship. Board members should consult their association’s attorney to discuss the legal implications of their decisions or actions prior to proceeding.Does the law apply to HOAs?
The Illinois Not-For-Profit Corporation Act primarily applies to homeowners associations organized as not-for-profit corporations. Many Illinois HOAs are set up this way, so the Act commonly governs their corporate structure, board authority, elections, meetings, records, and corporate governance rules for directors and officers.Open board meetings and 48-hour notice
For a not-for-profit homeowners association in Illinois, board meetings must generally be open to members, with limited exceptions for topics like litigation, employee matters, or rule violation discussions.The Act also requires HOA board meeting notice to be mailed or delivered at least 48 hours in advance and posted in conspicuous places at least 48 hours before the meeting. Learn more in our article on condo and HOA meeting requirements.
Annual member meetings
The Act allows the annual meeting timing to be set in the bylaws or by a board resolution authorized by the bylaws. Missing the “usual” annual date does not automatically invalidate corporate action, but the statute also gives members a path to ask a court to order a meeting if an annual meeting hasn’t happened within the timeframes in the Act and the board doesn’t send notice after a proper written request.Member meeting notice rules
Under 805 ILCS 105/107.15, notice generally must be delivered 5 to 60 days before the meeting. For higher-stakes actions like removing directors, mergers, dissolutions, or certain major asset transactions, the window is tighter on the front end: 20 to 60 days. The notice must include the place, day, and hour, and special meeting notices must include the purpose.Member quorum
The Act’s default rule is that a member meeting can start and conduct business when members holding 10% of the votes entitled to be cast on that matter are represented, in person or by proxy. If your documents do not set a different quorum, this standard typically applies.After quorum is reached, most actions pass with a majority of the votes cast, unless a higher threshold is required by Illinois HOA laws or the governing documents.
Proxies
Unless your articles or bylaws prohibit it, members can vote by proxy. The proxy is generally invalid after 11 months, unless the proxy says otherwise. This is one reason it’s worth checking whether your bylaws are aligned with how your HOA actually runs elections today.Voting without a meeting
The Act allows many member actions to be taken “by ballot” without a meeting, including by mail, via email, or using other electronic means. The number of members voting must be enough that it would have been a quorum if the vote happened at a meeting.Board quorum
If your documents don’t set a different rule, the default board quorum is a majority of directors then in office, but the Act sets a floor so quorum can’t be less than one-third of the directors then in office. The Act also allows directors (and committee members) to participate by conference phone or similar technology as long as everyone can communicate with each other during the meeting.Board vacancies
If a director resigns or a seat becomes vacant, the default rule is that the board can fill the vacancy, unless the articles or bylaws say it must be filled another way. The Act also allows directors to be removed with or without cause. If your board is “classified” (divided into several classes, usually with staggered elections), your articles or bylaws may require “cause” to remove a director under 805 ILCS 105/108.35(a).Conflicts of interest
A conflict does not automatically void a contract. Under 805 ILCS 105/108.60, a contract can still be valid if it was fair to the association when the board approved it. In practice, boards should focus on clear disclosure and good documentation.The interested director should explain the conflict, step back from the discussion, and let the remaining board members make the decision. Well-written minutes help show that the board handled the situation responsibly.
Owner inspection rights
The Act requires associations to keep accurate financial records and minutes for board and member meetings. It also gives voting members the right to review certain records if they make a written request and explain why they need them under 805 ILCS 105/107.75. Keeping organized files helps the board respond quickly to these requests and also makes resale packages, audits, and dispute resolution much easier.Director liability
The law outlines specific situations where directors can be held personally responsible, such as approving an improper distribution of assets (805 ILCS 105/108.65(a)(1)). At the same time, the Act also allows associations to defend or reimburse directors when legal issues arise, as long as the required standards are met. Many associations purchase directors and officers (D&O) liability insurance to give directors added protection while they serve.Compliance tips for HOAs
- Put your meeting notice routine in writing (who sends it, how it’s delivered, and when) and match it to the Act and your bylaws.
- Use a consistent approach to open meetings and executive sessions, with clear minutes and a clear reason when part of a meeting is closed.
- Keep a clean membership roster, minutes, and accounting records, and have a simple records request intake process.
- When using proxies or electronic voting, confirm your documents don’t prohibit them and enforce rules consistently.
- Treat conflicts as a disclosure and documentation process, and show the fairness analysis in the record.
How community association management companies can help
A professional community association management company can help Illinois HOAs stay organized and confident while applying the Illinois Not-For-Profit Corporation Act in daily operations.As North America’s leading community association management company, FirstService Residential serves Illinois HOAs with local expertise backed by national resources. Our teams support board members with meetings, recordkeeping, resident support services, financial management, banking and insurance programs, and 24/7 customer care teams. This way, board members can focus on long-term goals instead of day-to-day administration.
With over 60 years of experience across the state, we help HOAs, condo associations, high-rises, and master-planned communities operate smoothly and meet their goals with confidence.
To learn how we can support your association, contact our Illinois team today