Illinois Delays Controversial Crypto Tax Amid Industry Lawsuit

Illinois state officials and crypto industry groups jointly asked a Sangamon County judge to delay the start of the state's 0.2% Digital Asset Tax from Jan. 1, 2027 to July 1, 2027 while legal challenges proceed. The agreed motion, filed by the state and plaintiffs including the Chamber of Digital Commerce and the Illinois Blockchain Association, seeks a preliminary injunction and a stay of the tax's effective date; the court must still approve the request.

By AI Newsroom· Reviewed by Pranav, Founder & Editor-in-ChiefPublished 1 minute agoUpdated 1 minute ago0 views

Illinois Delays Controversial Crypto Tax Amid Industry Lawsuit

Why It Matters

The outcome affects when Illinois can begin collecting a tax that could raise an estimated $60 million in 2027 and highlights ongoing constitutional and compliance disputes between regulators and major crypto trade groups. A court decision to delay or block the tax would also shape enforcement and compliance timelines for exchanges and other digital-asset brokers operating in the state.

Key Facts

Filed in: Sangamon County Circuit Court
Parties seeking delay: Illinois state officials and crypto groups (The Digital Chamber/Chamber of Digital Commerce and Illinois Blockchain Association)
Motion type: Joint stipulated motion asking for preliminary injunction and stay of effective date
Original effective date: January 1, 2027
Requested new effective date: July 1, 2027

Illinois state officials and several crypto industry groups filed a joint motion in Sangamon County Circuit Court seeking to postpone the state's 0.2% Digital Asset Tax for six months, moving its start from Jan. 1, 2027 to July 1, 2027. The filing asks the court to preliminarily enjoin the tax and to stay its effective date while legal challenges to the law proceed. Because the motion is stipulated, both sides are requesting the same relief, but the court must approve the request before it takes effect.

The motion is tied to litigation brought by the Chamber of Digital Commerce (doing business as The Digital Chamber) and the Illinois Blockchain Association against Illinois Department of Revenue Director David Harris and Attorney General Kwame Raoul. The Digital Chamber publicized the agreement on X and credited its attorneys at Bellementis PLLC. The group has said the delay does not resolve the underlying suit, which continues to challenge the tax's constitutionality and enforceability.

Gov. J.B. Pritzker signed the Digital Asset Tax Act in June as part of the state budget for 2027. The law imposes a 0.2% levy on crypto purchases, transfers, and other activity in Illinois, collected from digital asset brokers such as major exchanges. Lawmakers estimated the tax could generate up to $60 million in 2027. Critics and industry groups have argued the measure is unusually broad and could apply regardless of whether users realize gains on transactions.

Separately, the Blockchain Association and the Crypto Council for Innovation have mounted their own legal challenge and in September asked the same court to block the tax, citing compliance costs and limited state guidance. At the federal level, the House Ways and Means Committee last month advanced the Digital Asset Tax Certainty Act, which would among other changes eliminate gain-or-loss calculations on certain small network fees starting in 2028. The Sangamon County judge has yet to rule on the stipulated request to delay the Illinois tax.