EARNED INCOME TAX CREDIT (EITC)

Rate (Fully-Refundable): 20% of the federal credit.

Eligibility Requirements: All Illinois taxpayers who qualify for the federal credit are automatically eligible. Taxpayers filing with Individual Taxpayer Identification Numbers and taxpayers ages 18-24 and 65 or older are also eligible. 

Latest Legislative Action: In 2022,  the Illinois legislature passed legislation to increase the state’s EITC to 20% of the federal credit, and expand eligibility to older workers, younger workers, and ITIN filers.  a state budget that included expanding the state’s EITC to 14% of the federal credit, retroactive to January 1, 2017, and then to 18% of the federal credit in January 2018.

Notes:

• In July 2018, Illinois passed a state budget that included expanding the state’s EITC to 14% of the federal credit, retroactive to January 1, 2017, and then to 18% of the federal credit in January 2018.
• In trying to resolve the state’s budget stalemate, legislators introduced 12 tax bills that would work together to both reduce spending while not disproportionately harming low-income workers and families. The bills, which lawmakers have dubbed “The Grand Bargain,” include one that would increase the state’s Earned Income Tax Credit (EITC) from 10 to 20 percent of the federal credit. It remains unclear whether the package will pass the House and Senate.
• Illinois’s state EITC began at 5% of the federal credit when it was introduced in 2011 and was increased to 10% in 2013.²

• In 2014, the Center for Economic Progress, Office of Chicago Mayor Rahm Emanuel, Chicago Housing Authority and the University of Illinois at Urbana-Champaign launched the Periodic Earned Income Tax Credit Payment Pilot Project, a year-long pilot program to provide quarterly advance EITC payments to a cohort of 343 households.³ Participants in the program reported feeling increasingly financially stable and were able to reduce their number of payday loans roughly by half. Read the full results of the project here.

CHILD TAX CREDIT (CTC)

Illinois does not currently offer a state-level CTC.

Latest Legislative Action:

• In 2023, lawmakers introduced HB3950, which would create a permanent state CTC valued at $700 per eligible dependent. The bill is in the House.
• In 2021, SB2132 proposed a state CTC worth $100 per child younger than 17 years old. The bill is in the Senate at this time.

Notes:

• As of 2023, the CTC is not available because the Senate Joint Resolution Constitutional Amendment No. 1 of the 101st General Assembly has not been approved at this time.

CHILD AND DEPENDENT CARE TAX CREDIT (CDCTC)

Illinois does not currently offer a state-level CDCTC.