By Kate Russell, CPA, Senior Manager
Fresh off the Governor’s desk in mid-June, House Bill 2755 (Public Act 104‑0006) rolled into law as part of Illinois’ fiscal year 2026 budget. Alongside sweeping tax changes, including the rollout of sports betting levies and the expansion of nexus definitions, the legislation authorizes three new amnesty programs for overdue taxes.
It’s not every day Illinois hands out hall passes, but these three generous tax amnesty programs are designed to help taxpayers catch up and clean their slate.
If you (or your business) have any lingering tax debts, missteps, or “oops” moments from recent years, this is your chance to make things right. In return, the state expects to pull in over $228 million in additional revenue, so Illinois is relying on plenty of people taking the offer.
Here’s a breakdown of the three programs.
1. GENERAL TAX AMNESTY
For tax periods beginning after June 30, 2018 and before July 1, 2024:
Application window: October 1 – November 15, 2025
This is the broadest of the three programs and covers most taxes administered by the Illinois Department of Revenue, including:
- Individual and corporate income taxes
- Sales and use tax
- Withholding tax
- Other IDOR-administered taxes
If you pay the full tax due during the amnesty window, all penalties and interest will be waived. You cannot use this amnesty if you are under criminal tax investigation.
2. FRANCHISE TAX & LICENSE FEE AMNESTY
For tax periods ending after June 30, 2019, and before July 1, 2025:
Application window: October 1 – November 15, 2025
This applies to businesses that file with the Illinois Secretary of State and have unpaid:
- Franchise taxes
- Business license fees
Many companies overlook these fees or find them surprisingly difficult to calculate. This program allows you to catch up without any late fees or interest, provided you make full payment. This is particularly helpful for foreign or dormant entities that may have missed filing in prior years.
3. REMOTE RETAILER AMNESTY
For uncollected sales between January 1, 2021, and June 30, 2026:
Application window: August 1 – October 31, 2026
This one is tailor-made for online and out-of-state sellers with Illinois customers. If you had a physical or economic nexus in Illinois (maybe unknowingly) but did not collect sales tax, Illinois is giving you the option to clean up those prior years.
You will pay a flat rate based on your gross Illinois sales:
- 9% for general merchandise
- 1.75% for qualifying food, drugs, and medical supplies
In exchange, all penalties and interest are forgiven. This is especially helpful for sellers who used third-party platforms and may have had uncollected tax exposure during those years.
Tax amnesty in Illinois is as common as a White Sox playoff run; you don’t want to miss this rare opportunity. Whether it’s back taxes, missed franchise filings, or uncollected e-commerce sales tax, this trio of programs is a one-time chance to get caught up with no extra baggage.
So, grab the metaphorical hall pass and get back into compliance, leaving the tax guilt behind. When these windows close, it’s back to business (and penalties) as usual.
The MichaelSilver team is here to help you determine if you qualify and to guide you through the process. Reach out, we are happy to review your situation and complete your filings before the deadline, 847-982-0333.
Kate Russell, CPA, Senior Manager, brings extensive experience in a wide range of tax matters, with a strong focus on developing strategic tax solutions for business clients. Since joining MichaelSilver in 2018, she has become an integral part of the Firm’s international team, assisting clients from around the globe as they expand into the U.S. market. Kate earned her Bachelor of Science in Business with a major in Accounting from Minnesota State University, Mankato. She is a member of the American Institute of Certified Public Accountants (AICPA) and serves on the International Subcommittee of the Illinois CPA Society (ICPAS).