IL HB1383

Creates a new Illinois income tax deduction for gratuities (tips) that are included in the taxpayer's federal adjusted gross income, effective for taxable years beginning on or after January 1, 2026

Defines "gratuities" using the definition in Section 3 of the Illinois Minimum Wage Law

Amends Section 203 of the Illinois Income Tax Act by adding subparagraph (NN) to allow individuals to subtract tip income from their Illinois base income calculation

The deduction is exempt from the sunset provisions of Section 250 of the Illinois Income Tax Act, meaning it would not automatically expire

Introduced by Rep. Ryan Spain in the 104th General Assembly (2025-2026 session) and takes effect immediately upon becoming law