Budget & Taxes (Income Tax)

in committee · Illinois · House May 14, 2026

HB 4877: INC TX-DEDUCT TIPS AND OT

Amends the Illinois Income Tax Act. Creates an income tax deduction for gratuities that are included in the taxpayer's federal adjusted gross income. Creates an income tax deduction for the amount of overtime compensation that is paid to the taxpayer during the taxable year and that is included in the taxpayer's federal adjusted gross income. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates state tax deductions for tips and overtime, reducing taxable income for workers. Provides tax relief for middle-income earners.90% confidence

Sub-Topics Income Tax

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in committee · Illinois · Senate May 27, 2026

SB 3780: INC TX-LGDF

Amends the Illinois Income Tax Act. Provides that an amount equal to 10% of the net revenue realized from the State income tax during the preceding month shall be transferred from the General Revenue Fund to the Local Government Distributive Fund (currently, the amount transferred is equal to the sum of (i) 6.47% of the net revenue realized from the tax imposed upon individuals, trusts, and estates during the preceding month; (ii) 6.85% of the net revenue realized from the tax imposed upon corporations during the preceding month; and (iii) 6.47% of the net revenue realized from the tax imposed upon electing pass-through entities). Effective immediately.

Topics ✗ Budget & TaxesOpposes Budget & TaxesReduces transfer to Local Government Distributive Fund from ~13.3% to 10% of income tax revenue, cutting local funding90% confidence

Sub-Topics Business Taxes Income Tax Revenue

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in committee · Illinois · House Mar 27, 2026

HB 5194: INC TAX-ENERGY CHOICE

Amends the Illinois Income Tax Act. Provides that a qualified taxpayer may apply to the Department of Revenue for an income tax credit in an amount equal to 20% of the wages paid by the qualified taxpayer to a qualified energy choice worker based in Illinois in the taxable year. Provides that the term "qualified taxpayer" means a taxpayer that is a regulated utility in the State of Illinois or a power generating company providing baseload or intermediate generation in Illinois and that meets specified criteria and is able to demonstrate an adverse and material operational impact to either its overall Illinois-based workforce or its ability to conduct business in Illinois based on the scheduled phaseout target dates of 2030, 2035, 2040, and 2045, as provided in Public Act 102-662. Sets forth limitations on the amount of the credit. Effective immediately.

Topics ✗ Budget & TaxesOpposes Budget & TaxesBill creates business tax credit, reducing state tax revenue and weakening the budget. Fits 'weaken' in oppose indicators.85% confidence ✓ Labor & EmploymentSupports Labor & EmploymentProvides tax credit for wages paid to energy choice workers, directly supporting compensation in the energy sector.90% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · House Mar 27, 2026

HB 4874: SMALL BUSINESS ASSET ACCT

Creates the Small Business Asset Purchase Account Act. Provides that a small business in the State may open a small business asset purchase account at an eligible financial institution. Provides that funds from a small business asset purchase account may be used only for specified eligible costs. Amends the Illinois Income Tax Act. Creates a deduction in an amount equal to 50% of the amount contributed during the taxable year to a small business asset purchase account. Creates a deduction of 100% of the interest earned on the account that is not included in the taxpayer's federal adjusted gross income. Amends the Uniform Penalty and Interest Act to provide for penalties for amounts withdrawn that are not used for eligible costs.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates 50% tax deduction for small business contributions under Illinois Income Tax Act, providing direct tax relief for small businesses.95% confidence

Sub-Topics Income Tax Tags Small Business

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in committee · Illinois · Senate May 22, 2026

SB 3865: INC TX-WHOLESOME FOOD

Amends the Illinois Income Tax Act. Creates an income tax deduction in an amount equal to 25% of the amount of the federal tax credit received for a donation of apparently wholesome food. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates 25% tax deduction for food donation donations, providing tax relief under Illinois Income Tax Act.95% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · Senate May 22, 2026

SB 3539: INC TAX-MANUFACTURING

Amends the Illinois Income Tax Act. Creates an income tax credit in an amount equal to 10% of the manufacturing capital expenditures incurred by the taxpayer during the taxable year or, if the taxpayer is located in a rural or economically challenged area, 15% of those expenditures. Provides that the total amount of credits awarded under these provisions may not exceed $10,000,000 for any particular taxpayer in any taxable year, except that, if the capital investment is made in a rural or economically challenged area, then the maximum amount awarded for any particular taxpayer in any taxable year shall be $20,000,000. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides 10-15% tax credit on manufacturing capital expenditures, reducing tax liability for businesses. Direct tax incentive alignates with fiscal support for economic growth.95% confidence

Sub-Topics Income Tax Tax Credits Tax Incentives

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in committee · Illinois · Senate May 22, 2026

SB 3791: INC TX-INNOVATION CREDIT

Amends the Illinois Income Tax Act. Provides that a taxpayer shall be allowed an income tax credit in an amount equal to 1.3% of the qualified research expenses made by the taxpayer in Illinois. Provides that the taxpayer is not required to have obtained a research and development credit with respect to his or her federal income taxes to qualify for the Illinois research and development credit.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides 1.3% income tax credit for R&D expenses, reducing business tax burden to incentivize innovation and economic development within state fiscal framework.95% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · Senate May 29, 2026

SB 3619: INC TX-HEALTH INSURANCE CREDIT

Amends the Illinois Income Tax Act. Creates an income tax credit for a qualified employer who makes a qualified contribution toward a health reimbursement arrangement for the qualified taxpayer's employees. Provides that the amount of the credit is $400 per covered employee in the first taxable year and $200 per covered employee in the second taxable year. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates tax credit for employers, reducing business tax liability and incentivizing health benefits coverage per employees.90% confidence ✓ HealthcareSupports HealthcareCreates tax credit for employers providing health reimbursement arrangements, expanding employee health insurance access through financial incentives.95% confidence ✓ Labor & EmploymentSupports Labor & EmploymentCreates tax credit for employer health benefits, incentivizing expanded employee health coverage under employment standards.90% confidence

Sub-Topics Income Tax Tax Credits Insurance

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in committee · Illinois · House May 22, 2026

HB 5215: MARK-TO-MARKET TAX ACT

Creates the Extremely High Wealth Mark-to-Market Tax Act. Provides that a resident taxpayer with net assets worth $1,000,000,000 or more shall recognize gains or losses as if each asset owned by that taxpayer had been sold for its fair market value on December 31 of the taxable year. Contains provisions concerning the calculation of the amount of tax due from those gains or losses. Amends the Illinois Income Tax Act to make conforming changes. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesImposes tax on ultra-wealthy's unrealized gains, increasing state revenue and closing a potential loophole per tax code amendment.95% confidence

Sub-Topics Income Tax

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in committee · Illinois · Senate Jul 6, 2026

SB 3873: INC TX-R AND D CREDIT

SB 3873 permanently extends Illinois' research and development (R&D) tax credit for businesses. It amends the Illinois Income Tax Act to make the R&D credit permanent, removing any expiration date. This change directly affects businesses that claim R&D credits on their state tax returns, providing ongoing eligibility without needing annual legislative renewal. The credit applies immediately upon the bill's effective date, offering predictable tax relief for qualifying companies investing in innovation.

Topics ✓ Budget & TaxesSupports Budget & TaxesPermanently extends R&D tax credit, providing ongoing tax relief for businesses investing in innovation, directly supporting business tax incentives under Budget & Taxes.95% confidence ✓ TechnologySupports TechnologyPermanently extends R&D tax credit, providing ongoing financial support for technology innovation and business investment in tech R&D.95% confidence

Sub-Topics Business Taxes Income Tax Tax Incentives

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