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SB 1813

INC TX-EDUCATION EXPENSE

104th Regular Session Introduced by Ram Villivalam

Creates a 50% Illinois education expense credit for custodians paying qualifying pupil costs, capped at $2,000 per child and $6,000 per family (AGI cap 400% FPL).

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Bill Summary · SB 1813

SB 1813 — INC TX-EDUCATION EXPENSE (Illinois)

A summary of the introduced bill to amend the Illinois Income Tax Act (35 ILCS 5/201).

Purpose and intent

  • Create an education expense credit for taxpayers who incur eligible education expenses on behalf of a qualifying pupil.
  • Establish eligibility criteria, calculation rules, and income-based limitations to target support for families paying education costs.

Key provisions

  • Education expense credit amount
    • The credit shall be 50% of the qualified education expenses incurred by a custodian on behalf of a qualifying pupil.
  • Benefit cap and family limit (effective for tax years ending on/after Dec. 31, 2025)
    • The education expense credit shall be no more than $2,000 per child.
    • Maximum credit per family: $6,000.
  • Income limitation
    • No taxpayer may claim the education expense credit if the taxpayer’s adjusted gross income (AGI) exceeds 400% of the federal poverty level.
  • Qualification and definitions
    • The bill changes the definition of “qualified education expense” (the specifics are not fully spelled out in the summary provided; the measure intends to refine what counts toward the credit).
  • Effective date
    • Effective immediately upon enactment for the provisions described; the cap and per-child limits apply to tax years ending after December 31, 2025.

Who is affected

  • Primary: Individual taxpayers who act as custodians incurring education expenses for a qualifying pupil.
  • Qualifying pupils and families paying education costs who meet the custodian and eligibility requirements.
  • Taxpayers with AGI above 400% of the federal poverty level would be ineligible for the credit.
  • Illinois income tax filers who may claim the credit on their state return (subject to the cap and definitions).

Procedural and timeline aspects

  • Status and actions
    • Introduced: February 6, 2025 (Senator Ram Villivalam); also listed with date of introduction as March 3, 2025.
    • Assigned to committees: initially to Revenue; subsequently moved to Local Government (per legislative actions) and then Rule 3-9(a) / Re-referred to Assignments (June 2, 2025).
    • Related legislation: Companion bill HB 2273.
  • Legislative process milestones cited
    • Read first time and referrals occurred in March 2025.
    • Various committee deadlines established (Rule 2-10) throughout spring 2025, signaling ongoing consideration.
  • Implementing body
    • Illinois General Assembly; the bill is ancillary to the Illinois Income Tax Act and would be administered by the Illinois Department of Revenue on state tax returns.

Additional notes

  • The financial impact of these changes is not provided in the summary; the cap (per child) and family cap are designed to constrain cost while expanding eligibility.
  • The “education expense” definition is to be refined, which will determine what costs qualify (e.g., tuition, fees, books, or related expenditures).
  • A companion bill exists in the House (HB 2273).

This summary focuses on the substantive change: creating a 50% education expense credit with per-child and per-family caps, an AGI eligibility limit, and an expanded/adjusted definition of qualified education expenses, effective immediately with caps applying to tax years after 2025.

Compiled from official sources — confirm details with the bill’s official record.

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