Illinois agrees to six-month delay of contested crypto tax pending court approval

Illinois has agreed to push the start of its contested 0.2% Digital Asset Tax from January 1 to July 1, 2027, in a joint court filing that still needs a judge’s approval.

The state and crypto industry groups filed the stipulated motion on October 1 in Sangamon County Circuit Court. The Digital Chamber announced the deal in a post on X, saying Illinois agreed to the delay after the group and the Illinois Blockchain Association sued over the tax.

Because the motion is stipulated, both sides are asking the court for the same outcome. Approval is still required before the new July 1, 2027 effective date takes effect. The filing states the six-month pause “will permit orderly briefing and adjudication of the underlying legal questions without prejudicing any Party’s rights, claims, or defenses on the merits.” It does not settle the litigation over whether the tax is constitutional.

Gov. JB Pritzker signed the Digital Asset Tax Act in June 2026 as part of the state’s 2027 budget. The law imposes a 0.2% levy on crypto activity by firms exceeding $100,000 in receipts, collected by digital asset brokers. Lawmakers projected it could raise as much as $60 million in 2027, an estimate rather than collected revenue.

The Digital Chamber and the Illinois Blockchain Association sued Illinois Department of Revenue Director David Harris and Attorney General Kwame Raoul, arguing the tax was added to the budget without debate and applies whether or not a user records a gain. The Blockchain Association and the Crypto Council for Innovation filed a separate challenge; the filing dates for that case differ between reports and are not settled.

Digital Chamber CEO Cody Carbone called the delay a significant win but stressed it is temporary. “A delay is not a repeal,” he said. In the group’s own announcement, Carbone said the delay relieves digital asset businesses of costly compliance obligations while the push to repeal the tax through the courts continues.

Under the law as written, brokers who failed to collect the 0.2% tax starting January 1 would have faced potential fines and prison time. That obligation now shifts to July 1, 2027, assuming the judge signs off on the agreement.