Illinois Crypto Tax Faces Legal Challenge From Digital Asset Group

A crypto advocacy group has taken Illinois to court over a new tax on digital asset transactions, arguing the measure unfairly targets crypto users.

Lawsuit Filed in Sangamon County

The Digital Chamber filed a civil suit in the circuit court of Sangamon County against Illinois Attorney General Kwame Raoul and David Harris of the Department of Revenue. The group claims the 0.2% tax, tucked into the state’s fiscal year 2027 budget, was passed without public debate.

Tax Applies Regardless of Gains

According to the filing, the tax hits crypto transactions even when no profit is made or ownership isn’t actually transferred. The group argues this treats digital asset holders differently than other investors simply based on how their holdings are recorded.

Governor JB Pritzker signed the budget bill in June. Under the law, brokers who fail to collect the tax could face fines or prison time once it takes effect in 2027.