Illinois Delays Digital Asset Tax Amid Industry Lawsuit

Illinois' Digital Asset Tax has been delayed until July 1, 2027, after state officials agreed to push back its start date in a joint motion filed in Sangamon County Circuit Court. The tax was initially set to take effect on January 1 of the same year.

The delay stems from a lawsuit brought by The Digital Chamber and the Illinois Blockchain Association against Illinois Department of Revenue Director David Harris and Attorney General Kwame Raoul, challenging the tax's constitutionality.

The motion is stipulated, meaning both sides are asking for the same outcome - to temporarily block the tax and stay its effective date until July 1, 2027. However, the court must still approve this request.

Lawmakers estimated that the tax could raise up to $60 million in 2027, imposing a 0.2% levy on crypto activity in the state, including purchases and transfers, which would be collected by digital asset brokers such as major exchanges.