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Thursday, September 18, 2025

House Republicans propose ending state tax on tips and overtime for Illinois workers

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Joseph C. Sosnowski, Illinois State Representative for 69th District | Official Website

Joseph C. Sosnowski, Illinois State Representative for 69th District | Official Website

Illinois House Republicans have introduced legislation aimed at removing state income taxes on tips and overtime pay. The proposal is part of the Relief for Working Families Bill Package and consists of three bills brought forward by Representatives Joe Sosnowski, Jennifer Sanalitro, and C.D. Davidsmeyer.

Representative Joe Sosnowski of Rockford filed HB1750, which seeks to amend the Illinois Income Tax Act to exempt tip income and overtime compensation from state taxation. If passed, this measure would let workers deduct these earnings from their taxable income in Illinois, increasing their take-home pay.

“When someone stays late, picks up extra shifts, or relies on tips to make ends meet, they shouldn’t be penalized at tax time,” Rep. Sosnowski said. “HB1750 helps ensure more of their hard-earned money stays in their pockets where it belongs.”

Representatives Jennifer Sanalitro and C.D. Davidsmeyer have also put forth similar bills—HB1898 and HB2735—which propose eliminating state tax obligations on gratuities reported to the IRS.

The sponsors argue that these changes are a matter of economic fairness, especially for those working in hospitality, food service, and personal care sectors where tips form a substantial part of total earnings. According to the Illinois Restaurant Association, there are over 77,000 restaurant servers in the state who depend on gratuities to supplement their wages. Overtime pay is also crucial for many workers who take additional shifts to support their families.

Supporters say these bills acknowledge the financial pressures faced by working-class families amid rising living costs and inflation. They argue that letting workers keep more of what they earn supports economic stability.

Sosnowski has represented Illinois’ 69th House District since 2011 after succeeding Ronald A. Wait (https://www.ilga.gov/house/Rep.asp?GA=103&MemberID=2887).

For now, Republican lawmakers maintain that focusing tax relief on tips and overtime pay sends a message that extra effort should not be penalized but rewarded.

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