What's New for Illinois Income Taxes

• Use Where’s My Refund? to find out if IDOR has initiated the refund process. For more specific information about the status of your refund after IDOR has finished processing it, you can check the Illinois Comptroller’s Find Your Illinois Tax Refund System.
• To qualify for the Illinois Earned Income Credit, you must meet certain requirements and file a tax return, even if you do not owe any tax or are not required to file. See the Illinois Earned Income Tax Credit (EITC) web page for more information.
• You can use MyTax Illinois to respond to most income tax correspondence from IDOR if you have a MyTax Illinois account. Simply log in to your account, click “more account options,” and “respond to notice” in the Letters and Messages section. 
• The Illinois exemption allowance, Illinois Property Tax Credit, and the K-12 Education Expense Credit are not allowed if the taxpayer’s adjusted gross income for the taxable year exceeds $500,000 for returns with a federal filing status of married filing jointly, or $250,000 for all other returns.

• The address change box (Step 1, Line B) has been removed from all business income tax returns (Forms IL-1120, IL-1120-X, IL-1120-ST, IL-1120-ST-X, IL-1065, IL-1065-X, IL-1041, IL-1041-X, IL-990-T, IL-990-T-X). IDOR will automatically update the account using the address entered into Step 1, Line B.
• Schedule B, Section B, for partnerships and S corporations and Schedule D, Section B, for fiduciaries has been reformatted from 4 columns to 3 columns to allow more information to be entered on each of the lines.
• Form IL-1041, Fiduciary Income and Replacement Tax Return, and Form IL-1041-X, Amended Fiduciary Income and Replacement Tax Return, have a new Grantor Trust checkbox added under Step 1, Letter D.
• In accordance with Public Act 103-0009, investment partnerships are now required to withhold an amount for their nonresident partners. As a result, Line 59 on Form IL-1065, Partnership Replacement Tax Return, and Form IL-1065-X, Amended Partnership Replacement Tax Return, has been changed into Lines 59a (pass-through withholding you owe on behalf of your members), 59b (investment partnership withholding), and 59 (total withholding). Also, a new schedule, Schedule K-1-P(4), Investment Partnership Withholding Calculation for Nonresident Partners, has been developed to aid in calculating the withholding requirement.
• Partnerships electing to make the election to pay pass-through entity (PTE) tax may now deduct distributions to retired partners, to the extent those distributions are exempt from Illinois tax, when calculating base income subject to PTE tax.
• The year has been removed from the top of the business income tax vouchers. To avoid processing delays, taxpayers and preparers should ensure that the month and year are entered on the “Tax year ending” lines of each voucher.
  Schedule J, Foreign Dividends, Lines 13, 14, and 15, have been modified to include a reference to Federal Schedule C, Line 16a.
• Schedule M has been modified to include:
  • a new subtraction line (Line 35) which will allow a subtraction for cannabis establishments operating and licensed in Illinois that had deductions disallowed federally under IRC Section 280E.
  • new reserved lines for future subtractions, and
  • a new note to Line 39 which was added to help reduce the number of entries mistakenly reported on this line which should have been reported on another line of Schedule M or Illinois business income tax schedule.
• Form IL-4562, Special Depreciation, has been modified to include calculations for property placed in service after December 31, 2023, and before January 1, 2025, subject to 60 percent federal bonus depreciation.

• In accordance with Public Act 102-1053, the Recovery and Mental Health income tax credit was created and is effective for tax years beginning on or after January 1, 2023. The credit has been added to Schedules 1299-I, 1299-A, 1299-C, and 1299-D. Contact the Illinois Department of Human Services (IDHS) for more information.
• In accordance with Public Act 102-0700, the maximum K-12 Instructional Materials and Supplies credit amount allowed for Form IL-1040 filers has increased. For tax years beginning on or after January 1, 2023, the maximum credit allowed for a single taxpayer is $500 or $1000 for taxpayers married, filing jointly.
• For the Adoption credit (Form IL-1040 filers only), no new credits will be allowed for tax years beginning on or after July 12, 2024.
• For the Agritourism Liability Insurance income tax credit, no new credit will be allowed for tax years ending after December 31, 2023.
• For the Invest in Kids credit, no new credit will be allowed for tax years ending after December 31, 2023.
• In accordance with Public Act 103-0009, the Historic Preservation tax credit has been extended to tax years ending on or before December 31, 2028.
• In accordance with Public Act 103-0009, the New Markets Development tax credit has been extended to tax years ending on or before June 30, 2031.
• In accordance with Public Act 103-0268, the Hydrogen Fuel Replacement tax credit was created and is effective for tax years ending on or after December 31, 2027.
• In accordance with Public Act 103-0396, earned credits for tax years ending on or after December 31, 2023, are allowed to be passed through to the partners and shareholders in accordance with either the determination of income and distributive share of income or as otherwise agreed to by the partners or shareholders.

Publication 131-D, 2023 Withholding Income Tax Payment and Return Dates, has been updated to include the specific due dates for withholding payments and Form IL-941, Illinois Withholding Income Tax Return.

The following withholding income tax forms must be submitted electronically by the due date indicated in the chart below. See Publication 110, Forms W-2, W-2c, W-2G, and 1099 Filing and Storage Requirements for Employers and Payers, including 1099-K Electronic Filing Requirements for more information.

 Note: The Illinois filing requirements for these documents are separate from the federal filing requirements. Failure to submit required documents to Illinois directly may result in penalties.

• Tax forms and form instructions, when released, can be found in the forms area of IDOR’s website, https://tax.illinois.gov/forms.
• Illinois vendor draft forms pages have been moved to a new location. Vendors must complete a Form IL-8633-SF, Substitute Forms Provider Annual Enrollment, before being given the hyperlink to the vendor draft forms page. A username and password is no longer needed to access the page. For more information, see our website.
• Substitute paper forms must be submitted and approved through our Forms Approval Program. For more information, see the IL-8633-SF Guide, Substitute Forms Guidelines on our website.
• Reminder: If you are a tax preparer, make sure your tax preparation software is up to date. Using the most recently updated version of your tax preparation software helps reduce the time it takes us to process your clients’ returns and helps ensure the security of your clients’ tax information.
  NOTE: Do not mail IDOR any version of a form that contains a watermark.
• Certain paper returns will be processed using imaging software. All specifications for producing substitute forms, including the 1-D barcode and 2-D barcode, are available on the “Draft Forms” web page. See the Substitute Forms Developers web page for more information.

• Personal Exemption — The personal exemption amount for tax year 2024 will increase to $2,775. This impacts 2024 Form IL-1040 for individuals, including estimated payments, and 2024 withholding income tax rates for employers (see Form IL-700-T, ​Illinois Withholding Tax Tables Booklet).
• We encourage taxpayers to check our website at tax.illinois.gov for the most current information.