Illinois Digital Asset Tax Sparks Controversy Among Crypto Users
The Illinois Department of Revenue's new digital asset tax has sparked controversy among crypto users and brokers. Under the rules, set to start on January 1, 2027, customers will face monthly tax bills based on their total asset value if their brokers fail to collect the levy.
Blockchain Association and the Crypto Council for Innovation have filed a complaint in the Circuit Court of the Seventh Judicial Circuit in Sangamon County, alleging that the Digital Asset Tax Act is invalid. The plaintiffs claim that the law violates federal and state due process protections, as well as Illinois constitutional rules on tax uniformity, delegation, and the legislative process.
The new tax requires brokers to collect 0.2% of the value of digital assets involved in a taxable transaction. If a broker fails to charge the tax, customers must remit it by the 20th day of the following month. The plaintiffs are seeking a declaration that the Digital Asset Tax Act is invalid and preliminary and permanent injunctions blocking its implementation.