 |
|
|
 |
Marty Green's Capitol Update
General Assembly Passes $55 Billion Budget, Leaves Several Bills for Fall Session
Despite various avenues of fiscal friction, the Illinois General Assembly passed a $55 billion state operating budget for fiscal year (FY) 2026, providing the governor with emergency powers to access $100 million to close funding gaps resulting from the federal government not disbursing obligated funds for state-administered programs.
Overall, the Illinois CPA Society (ICPAS) had a good spring legislative session, with the unanimous passage of House Bill (HB) 2459, which provides two additional pathways to certified public accountant (CPA) licensure. Despite chatter from the City of Chicago, no tax on professional services was brought forward. There were also no fund sweeps of the accounting professional fund (dissimilar to other special funds).
Tax aficionados will notice only five stand-alone tax bills were passed. Over 50 tax changes are included in HB 2755, which is the revenue omnibus bill that’s part of the budget package. Included in the omnibus bill are also economic development incentives that originally appeared in Senate Bill (SB) 2008.
Other noteworthy legislative changes include a technical fix to Tier II public pension systems. There was a significant push by the public labor unions to achieve parity with the Tier I pensions; however, lawmakers were unpersuaded by the enormity of the estimated long-term costs of the proposed enhancements.
Of course, the General Assembly left several big legislative items on the table that’ll have to be dealt with, including the looming public transit fiscal cliff, energy reform, growing cannabis, higher education, and ethics. Illinois lawmakers have scheduled six days in October for the fall veto session. However, it’s likely that both chambers will return to Springfield before then to address these pressing issues.
|
|
|
|
|
|
LATEST LEGISLATIVE NEWS
|
General Assembly Passes State Operating Budget for Fiscal Year 2026
SB 2510 makes appropriations for FY 2026 totaling $55.2 billion in general expenditures. Status: Public Act 104-0003.
HB 2755 provides $55.4 billion in general revenue funds for the FY 2026 state operating budget. This includes $880 million in new revenues needed to support the budget. Status: Public Act 104-0006.
HB 1075 creates the Fiscal Year 2026 Budget Implementation Act, making statutory changes to existing statutory provisions to implement the new state budget. Status: Public Act 104-0002.
HB 3374 provides bonding authority for the FY 2026 state operating budget. The bill amends the State Finance Act, General Obligation Bond Act, and Build Illinois Bond Act. It also makes changes concerning the amount of bond authorizations. Status: Public Act 104-0008.
|
|
Audit Relief for Certain Municipalities Granted
HB 1082 removes the annual audit report requirements for municipalities with a population of less than 1,000 people. These municipalities must file annual financial reports with the Illinois Office of the Comptroller and an audit report every fourth year. Status: Passed both chambers and sent to the governor.
|
|
Modifications Made to Emergency Services Districts Act
HB 2142 allows contiguous territories to organize as emergency services districts if they have at least 300 inhabitants and aren’t included in an emergency service or fire protection district that provides rescue services. Additionally, the bill provides that the board of trustees of an emergency services district may now provide ambulance services, borrow money, mortgage district properties, and manage real estate for service-related operations. Status: Passed both chambers and sent to the governor.
|
Bill Expanding General Jurisdiction Over Foreign Corporations in Toxic Tort Cases Passes
SB 328 significantly expands the jurisdictional reach of Illinois courts in toxic tort litigation by establishing new bases for asserting general personal jurisdictions over foreign corporations. The Illinois business community opposed this legislation. Status: Passed both chambers.
|
New Bill Establishes Regulations for Digital Asset Kiosks
SB 2319 regulates digital asset kiosks in Illinois to protect customers from fraud and scams. The bill outlines registration requirements and operational protocols for digital asset kiosk operators, including the necessity to provide live customer service, maintain a daily transaction limit of $2,500 for new customers and $10,500 for existing customers, and the implementation of blockchain analytics software to prevent fraudulent transactions. Kiosk operators must adhere to strict customer disclosure requirements before allowing transactions, including clearly stating fees, the market price of digital assets, and warnings regarding potential losses. The Illinois Department of Financial and Professional Regulation (IDFPR) is tasked with enforcement, including the ability to revoke or suspend registrations and impose fees and penalties through established guidelines. Status: Passed both chambers.
|
Bill Enhances Consumer Protection on Digital Assets
SB 1797 establishes new regulatory frameworks for digital asset business activities in Illinois to enhance transparency and consumer protection. The bill imposes regulations on customer disclosures and mandates custodial requirements to prohibit the misuse of these assets. Under this bill, IDFPR gains extensive enforcement powers, including the ability to issue registrations, approve transactions, investigate complaints, and impose civil penalties for non-compliance. Status: Passed both chambers.
|
Public Transit Bill Consolidates Operational Oversight
HB 3438 outlines changes to the governance and operational oversight of transportation authorities. In addition to governance changes, the bill replaces all instances of the term “transit” with “transportation,” reflecting a broader strategic focus on transportation rather than solely public transit systems. The bill also modifies funding provisions by removing specific allocations from tax revenues for various funds (such as the ADA Paratransit Fund), which changes the financial dynamics for where and how state revenues are distributed. The bill also includes new taxes on home delivery, real estate transfers, and tollway user assessments. Status: Senate amendment is pending in the House.
|
Interchange Fee Prohibition Delayed
HB 742 modifies the effective dates specified in the Interchange Fee Prohibition Act. Specifically, it establishes that Article 150 will now take effect on July 1, 2026, instead of Jan. 1, 2025. Status: Public Act 104-0004.
|
Bill Expands Workplace Transparency Confidentiality
HB 3638 expands the Workplace Transparency Act to include protections against violations of state or federal employment laws alongside unlawful discrimination and harassment. Under the law, clauses designed to prevent employees from making truthful disclosures about unlawful practices are voided. Additionally, confidentiality provisions in settlement or termination agreements are strictly regulated, requiring employee consent and barring unilateral employer impositions. Status: Passed both chambers and sent to the governor.
|
State Treasurer May Now Establish Nonprofit Investment Pool
SB 246 authorizes the establishment of a nonprofit investment pool where the state treasurer can receive and manage funds from not-for-profit corporations exempt from taxes under sections 501(c)(3) and 501(c)(5) of the Internal Revenue Code (IRC). This bill is supported by ICPAS. Status: Passed both chambers and sent to the governor.
|
Bill Amends Provisions Concerning Small Estate Affidavits
SB 83 expands the use of the small estate affidavit to transfer personal property valued up to $150,000, including motor vehicles, provided no letters of office are outstanding and no petitions are pending. Status: Passed both chambers and sent to the governor.
|
Secure Choice Program Offers New Retirement Savings Opportunities
SB 1441 amends the Illinois Secure Choice Savings Program Act to provide that accounts established under the program are individual retirement accounts (IRAs). Key amendments provide for contributions from multiple employers into a single account and that each enrollee can also choose between a Roth IRA and/or a traditional IRA. Status: Passed both chambers and sent to the governor.
|
Bill Allows for Web-Based Signatures
SB 2044 authorizes various local government entities in Illinois—including counties, townships, municipalities, forest preserve districts, and park districts—to permit the use of web-based signatures for signing documents. This is contingent upon the use of a secure web-based platform. Notably, web-based signatures can’t be applied to candidate nominations or petitions and referendum petitions. Status: Passed both chambers.
|
|
CPA Appointed to the Illinois Gaming Board
Steve Ferrara, CPA, was appointed to the Illinois Gaming Board. Status: Confirmed by the Illinois Senate.
|
|
Federal Budget Reconciliation Act Moves to Senate
(SALT and PTE)
H.R. 1 passed the U.S. House of Representatives on May 22, 2025. The complex legislation would generally make the tax provisions of the 2017 Tax Cuts and Jobs Act permanent. Additionally, it would deny partnerships and S corporations the ability to deduct specific taxes under section 275 of the IRC and would require the taxes to be passed through to owners as separately stated items. Dissimilarly, the Senate version doesn’t exclude the pass-through entity (PTE) state and local tax (SALT) deduction but materially limits the deduction for high-earning taxpayers. ICPAS and the AICPA have been working with the Illinois congressional delegation on this matter.The AICPA submitted recommendations to the Senate Finance Committee. Status: Passed the House; pending in the Senate Finance Committee.
|
| |
|
|
|
INSIDE INSIGHT MAGAZINE
|
 |
What CPAs Should Know About the Growing Vacation Rental Landscape
CPAs who understand the complex tax and financial requirements of vacation rentals are best positioned to help a growing client base optimize their financial outcomes.
|
|
|
|
|
