- Illinois officials and crypto groups asked a court to delay the 0.2% Digital Asset Tax until July 1, 2027.
- The request follows lawsuits challenging the tax’s constitutionality and enforceability.
The Illinois crypto tax could be pushed back by six months if a judge approves a joint motion filed in Sangamon County Circuit Court. State officials agreed with industry groups to seek a delay of the Digital Asset Tax from Jan. 1 to July 1, 2027, while litigation continues. The tax was signed into law in June by Gov. JB Pritzker as part of the state’s 2027 budget and sets a 0.2% levy on crypto activity in Illinois. The court filing does not end the dispute, however, because the underlying case over the tax’s constitutionality and enforceability is still moving forward in parallel with another separate challenge.
Illinois crypto tax delay request heads to court
Illinois officials and crypto groups jointly filed the motion on Thursday in Sangamon County Circuit Court. The filing asks the court to preliminarily enjoin the tax and pause its effective date until July 1, 2027, instead of the current Jan. 1 start date. Because the motion is stipulated, both sides are requesting the same result from the judge.
Even with that agreement, the delay is not automatic. The court still has to approve the request before the new date can take effect. If the judge signs off, Illinois crypto users would get a six-month reprieve from the planned start of the 0.2% Digital Asset Tax.
Lawsuit behind the Illinois crypto tax dispute
The court request comes from a lawsuit brought by The Digital Chamber and the Illinois Blockchain Association. The case names Illinois Department of Revenue Director David Harris and Attorney General Kwame Raoul as defendants. The groups are continuing to challenge whether the tax is constitutional and enforceable under state law.
The Digital Chamber announced the agreement on X and credited its attorneys at Bellementis PLLC. While the filing reflects a shared request to delay the tax, it does not resolve the broader legal questions raised in the case. The challenge itself remains active as the court considers the next steps.
What the Illinois crypto tax would cover
Gov. JB Pritzker signed the Digital Asset Tax Act in June as part of Illinois’ 2027 budget. The law creates a 0.2% levy on crypto activity in the state, including purchases and transfers. It would be collected by digital asset brokers such as major exchanges.
Lawmakers estimated the measure could raise as much as $60 million in 2027. Critics have focused on how broadly the tax applies. The Digital Chamber said the levy affects users whether or not they realize any gain, while the Crypto Council for Innovation described it as the most punitive digital asset tax in the country.
Separate legal challenge is also underway
A second case tied to the same tax is being pursued by the Blockchain Association and the Crypto Council for Innovation. On Sept. 9, those groups asked the same court to block the tax. They argued that firms were already spending millions of dollars to build compliance systems without meaningful guidance from the state.
At the federal level, the House Ways and Means Committee advanced the Digital Asset Tax Certainty Act last month. Among its changes, the bill would remove gain-or-loss calculations on qualifying network fees of $10 or less starting in 2028. That measure is separate from the Illinois crypto tax case now before the state court.
Conclusion
The Illinois crypto tax remains in legal limbo as state officials and industry groups wait for a judge to rule on their joint request. If approved, the 0.2% levy would be delayed from Jan. 1 to July 1, 2027, giving crypto users and firms more time while the constitutional challenge continues. The dispute is not limited to one lawsuit, since a separate case from other industry groups is also asking the same court to block the law. For now, the next step for the Illinois crypto tax depends on whether the court grants the stipulated motion and how the broader litigation over the measure unfolds.
Disclaimer
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