Budget & Taxes (Income Tax)

in committee · Illinois · Senate Jul 9, 2026

SB 3792: INC TX-DEDUCTION FOR TIPS

Amends the Illinois Income Tax Act. Creates an income tax deduction for gratuities that are included in the taxpayer's federal adjusted gross income. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates tax deduction for tips, providing relief to service workers (lower/middle income) by reducing taxable income under Illinois tax law.90% confidence

Sub-Topics Income Tax

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in committee · Illinois · House Mar 27, 2026

HB 5203: INC TX-HOTEL RENOVATION

Amends the Illinois Income Tax Act. Creates an income tax credit for a taxpayer who owns, operates, or manages a hotel. Provides that the amount of the credit is equal to 25% of the qualified renovation expenditures incurred during the taxable year, subject to specified limitations. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates 25% tax credit for hotel renovation expenses, providing direct tax relief to businesses under Illinois Income Tax Act.95% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · Senate Feb 5, 2026

SB 3544: JOB CREATION PILOT PROGRAM ACT

Creates the Job Creation Zone Pilot Program Act. Sets forth the boundaries of the job creation zone. Provides that applicants that pledge to hire at least 5 new employees at a designated location within the job creation zone are eligible for credits against their obligation to pay over withholding taxes under the Illinois Income Tax Act. Authorizes an applicant to request a credit award under the Act by making a formal written request or application with the Department of Commerce and Economic Opportunity. Specifies that the amount of the credit may not exceed (i) 50% of the incremental income tax attributable to each new employee during the calendar year in which the new employee is hired and for the first 2 calendar years after the new employee is hired and (ii) 25% of the incremental income tax attributable to each new employee during the third and fourth calendar years after the new employee is hired. Grants the Department of Commerce and Economic Opportunity rulemaking powers to implement and enforce the Act. Amends the Illinois Income Tax Act to make conforming changes. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides tax credits against withholding taxes for businesses hiring 5+ employees in designated zones, reducing tax liability for job creators.95% confidence

Sub-Topics Income Tax Tax Incentives Tags Economic Development

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in committee · Illinois · House Apr 20, 2026

HB 5123: INC TX-PROP TX CREDIT

Amends the Illinois Income Tax Act. Provides that, if the amount of the credit for residential real property taxes exceeds the taxpayer's liability, that amount shall be refunded if the taxpayer is 65 years or older and has a federal adjusted gross income of not more than $50,000. Provides that the credit is exempt from the Act's automatic sunset provision. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesProvides refundable property tax credit for seniors with low income ($50k AGI), offering targeted tax relief to lower-income residents under Budget & Taxes policy.95% confidence

Sub-Topics Income Tax

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in committee · Illinois · Senate Jul 13, 2026

SB 3784: INC TX-DONATIONS OF PROPERTY

Amends the Illinois Income Tax Act. Creates an income tax credit for a taxpayer that makes a qualified donation of real property during the taxable year to an employer that will use the property for the purpose of providing onsite child care to its employees. Provides that the credit shall be in an amount equal to the fair market value of the property, as determined by the Department of Revenue by rule.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates tax credit equal to fair market value of donated property, providing direct tax relief to taxpayers under Illinois Income Tax Act per Budget & Taxes indicators.95% confidence ✓ Labor & EmploymentSupports Labor & EmploymentProvides tax credit for employer-provided onsite childcare, directly enhancing workplace benefits and supporting employee retention through childcare access.85% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · House Mar 27, 2026

HB 5080: INC TAX-CHILD CARE

Amends the Illinois Income Tax Act. Provides that the tax credit for employee child care shall be (i) 30% of the start-up costs expended by the corporate taxpayer to provide a child care facility for the children of its employees and (ii) 10% (currently, 5%) of the annual amount paid by the corporate taxpayer in providing the child care facility for the children of its employees. Creates an income tax credit for corporate taxpayers that are qualified small businesses in an amount equal to 10% of the federal tax credit claimed by the taxpayer for the taxable year for qualified child care expenditures. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesIncreases corporate tax credits for child care expenses, providing tax relief to businesses under Illinois tax law.95% confidence ✓ Labor & EmploymentSupports Labor & EmploymentProvides tax credits for employers offering child care, supporting working parents' employment stability and reducing work-life conflict - a direct benefit to employment standards.85% confidence

Sub-Topics Income Tax Tax Credits

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in committee · Illinois · Senate Jul 9, 2026

SB 3868: INC TAX-PROP TAX CREDIT

Amends the Illinois Income Tax Act. Increases the tax credit for residential real property taxes from 5% of the real property taxes paid by the taxpayer during the taxable year on the principal residence of the taxpayer to 10% of the real property taxes paid by the taxpayer during the taxable year on the principal residence of the taxpayer. Provides that the credit is exempt from the Act's automatic sunset provision. Effective immediately.

Topics ✓ Budget & TaxesSupports Budget & TaxesIncreases property tax credit from 5% to 10% for homeowners, providing direct tax relief. Aligns with support indicators for middle-income tax relief.95% confidence

Sub-Topics Income Tax Property Tax Tax Credits

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in committee · Illinois · Senate Feb 6, 2026

SB 3874: INC TX-BONUS DEPRECIATION

SB 3874 repeals Illinois' enhanced bonus depreciation deduction for business equipment from the state income tax code. This change directly affects businesses that previously claimed accelerated tax deductions for qualifying equipment purchases. The bill eliminates this specific tax provision effective immediately upon enactment, with no new mechanisms or alternative deductions introduced. It is a straightforward repeal of an existing tax benefit, not a new policy.

Topics ✗ Budget & TaxesOpposes Budget & TaxesRepeals Illinois' enhanced bonus depreciation tax deduction, eliminating a business tax benefit. Directly reduces available tax breaks under state tax code.95% confidence

Sub-Topics Business Taxes Income Tax

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in committee · Illinois · Senate Feb 5, 2026

SB 3542: INC TX- PAID TIME OFF

Amends the Illinois Income Tax Act. Creates an income tax credit for each taxpayer that is an eligible small employer in an amount equal to the amount paid during the taxable year by the eligible small employer to its employees as paid leave that is required by the Paid Leave for All Workers Act. Provides that an eligible small employer is an employer that employs 50 or fewer employees during the taxable year and is subject to the Paid Leave for All Workers Act. Effective January 1, 2027.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates income tax credit for small employers providing paid leave, reducing tax liability (tax relief) for eligible businesses under Illinois tax code.85% confidence ✓ Labor & EmploymentSupports Labor & EmploymentCreates tax credit for small employers providing mandated paid leave, incentivizing expanded worker benefits under Paid Leave for All Workers Act.95% confidence

Sub-Topics Income Tax Tax Credits Paid Leave

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in committee · Illinois · Senate May 22, 2026

SB 3710: INC TX-R AND D CREDIT

SB 3710 permanently extends Illinois' research and development (R&D) tax credit under the Illinois Income Tax Act. This change makes the credit available indefinitely for eligible businesses, rather than as a temporary provision. The bill directly affects companies conducting qualifying R&D activities within Illinois that claim this tax credit. It amends Section 201 of the tax code to remove any expiration date, effective immediately upon enactment. The credit allows businesses to reduce their state tax liability based on qualified R&D expenditures.

Topics ✓ Budget & TaxesSupports Budget & TaxesPermanently extends Illinois R&D tax credit, providing ongoing tax relief to businesses under Income Tax Act, directly strengthening tax incentive policy.95% confidence

Sub-Topics Income Tax Tax Credits

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