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HB 2609

INC TX-REDUCE CORPORATE RATE

104th Regular Session Introduced by Adam Niemerg

Illinois lowers corporate income tax from 7% to 5.5% for taxable years beginning on or after Jan. 1, 2025.

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Bill Summary · HB 2609

Summary — HB 2609 (Illinois): Reduction of Corporate Income Tax Rate

Status and sponsor
- Bill number: HB 2609
- Short title in docket: INC TX — REDUCE CORPORATE RATE
- Primary sponsor: Rep. Adam M. Niemerg
- Current status (per provided record): Referred to Rules Committee; various readings and committee actions recorded (see “Procedural timeline” below).

Purpose
- To reduce the Illinois corporate income tax rate applied to corporate net income from 7.0% to 5.5%.

Key provisions
- Amends Section 201 of the Illinois Income Tax Act (35 ILCS 5/201).
- Replaces existing rate language so that, for corporations, “for taxable years beginning on or after January 1, 2025, an amount equal to 5.5% of the taxpayer’s net income for the taxable year” is imposed (new corporate rate: 5.5%).
- Preserves the statute’s transitional provisions for periods that cross the effective date (text contains phased/period language for prior years).
- Leaves other rate and tax provisions (including existing surcharges and other subsections such as Section 201.5) intact unless separately amended.

Effective date
- The statutory language sets the new 5.5% rate for taxable years beginning on or after January 1, 2025. (A short synopsis in the package also notes “Effective immediately”; the statute text itself specifies taxable years beginning Jan 1, 2025 — this is an important timing detail to confirm in committee/fiscal analyses.)

Who is affected
- All corporations subject to the Illinois Income Tax Act — i.e., corporations earning or receiving net income in Illinois — will have their income subject to the lower 5.5% rate for taxable years covered by the change.
- Indirect effects may accrue to shareholders, employees, suppliers and state-funded programs via changes in corporate behavior and state revenue.

Potential impacts (directional, not quantified)
- Revenue: A lower corporate rate would reduce State corporate income tax receipts relative to current law; the magnitude depends on corporate taxable income in relevant years and any behavioral responses.
- Economic: Proponents may argue the reduction increases Illinois’ competitiveness for business location and investment.
- Budgetary: Reduced revenue could increase pressure on the state budget, potentially affecting spending priorities or leading to offsets through other tax or policy changes.
- Distributional: The reduction primarily benefits corporations and owners; effects on employment and investment are uncertain and depend on corporate responses.

Procedural timeline (from provided record — contains mixed entries)
- Filed / Introduced: early February 2025 (records show filings on Feb 4–6, 2025 and sponsor listed).
- Readings and committee referrals: multiple first/second readings and referrals (House First Reading, House Second Reading, Referred to Rules Committee).
- Committee activity: Public hearing and committee substitute considered (committee actions and testimony recorded on 2025-04-23); some entries indicate “left pending” and at least one “FAILED” entry dated 2025-03-11 — the record appears to include mixed or duplicate procedural notes and should be cross‑checked with the official legislative clerk or bill tracking system for current status.

Notes and recommendations
- The provided document package appears to include text from an unrelated Arizona bill (also numbered HB 2609) concerning middle-school advanced mathematics placement. That is not part of the Illinois corporate tax proposal; confirm you are tracking the Illinois HB 2609 (Rep. Niemerg) for corporate tax changes.
- For fiscal magnitude and budgetary implications, consult the bill’s fiscal note from the Illinois Comptroller/Revenue Department or Legislative Fiscal Office (not included in the provided materials).

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

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