IL HB0186

Creates a new tax credit (subsection j) for employers with 250 or fewer full-time equivalent employees who provide raises to qualified employees.

Qualified employees must receive a permanent pay increase resulting in a post-raise annual salary of at least $31,200 and must have worked for the employer for at least 180 consecutive days before the raise takes effect.

Credit amounts are tiered based on salary ranges: 25% of raise amount up to $37,400 annualized; 20% from $37,400 to $41,600 annualized; and 15% from $41,600 to $52,000 annualized.

Credits may be claimed for reporting periods beginning January 1, 2022 through December 31, 2030, but not more than 2 years after the raise's effective date.

Employers must maintain average wage increases for all employees earning less than $52,000 compared to the prior year to be eligible for the credit.