Illinois and two crypto industry groups asked a state court on October 1 to push the start of the state's 0.2% Digital Asset Tax from January 1, 2027 to July 1, 2027, according to a stipulated joint motion filed in Sangamon County Circuit Court.

The agreement, if approved by a judge, would temporarily enjoin the tax while litigation over its constitutionality continues. The filing asks the court to preliminarily block the levy and stay its effective date until July.

What does the stipulated motion cover?

The motion stems from a lawsuit brought by the Chamber of Digital Commerce, known as The Digital Chamber, and the Illinois Blockchain Association. The two trade groups sued Illinois Department of Revenue Director David Harris and Attorney General Kwame Raoul.

Both sides have asked the court for the same outcome, but the judge must still sign off before the delay takes legal effect. Until then, the statutory January 1 effective date technically remains on the books.

The Digital Chamber announced the deal on X, crediting its outside counsel: attorneys Teresa Goody, Andoni Olta, and Angela Papalaskaris at Bellementis PLLC.

The six-month reprieve does not resolve the underlying case. The Digital Chamber and Illinois Blockchain Association remain committed to a full constitutional challenge of the levy and its enforcement against in-state activity.

How does the tax apply?

The Digital Asset Tax Act imposes a 0.2% levy on crypto transactions in Illinois, including purchases and transfers of digital assets. Digital asset brokers such as major exchanges would collect the tax at the point of trade.

State lawmakers estimated the tax could raise as much as $60 million in 2027. The law sits inside the broader fiscal 2027 budget package Governor JB Pritzker signed in June.

The Crypto Council for Innovation labeled it the "most punitive digital asset tax" in the country. Industry critics have focused on how broadly the levy applies to ordinary wallet activity.

The Digital Chamber has argued the tax captures users whether or not they realize a gain, a structural break from capital gains frameworks. That framing has shaped the industry's constitutional arguments and its public messaging.

What other challenges are pending?

The Blockchain Association and the Crypto Council for Innovation are pursuing a parallel challenge in the same court. On September 9, the two groups filed a separate motion asking the court to block the tax outright.

They contend firms have already spent millions building compliance systems without meaningful guidance from Illinois regulators. The September 9 filing tracks the same constitutional theory advanced in the original Digital Chamber complaint.

What's happening at the federal level?

In Washington, the House Ways and Means Committee advanced the Digital Asset Tax Certainty Act last month. The bill targets the patchwork of state-level crypto levies and reporting rules that have multiplied over the past two years.

Among its provisions, the legislation would eliminate gain-or-loss calculations on qualifying network fees of $10 or less, starting in 2028. The threshold aims to relieve reporting burdens on routine, low-value transactions.

If enacted, the federal measure would pre-empt or constrain state-level levies like Illinois' for certain transaction types. The six-month delay in Springfield gives industry litigants and federal lawmakers time to test how the two regulatory tracks interact.

What comes next?

The court has not yet set a hearing date on the stipulated motion. A ruling before the end of 2026 would preserve the January 1 effective date only if the judge denies the request for a preliminary injunction.

A denial would also push the parties back into adversarial litigation under the original schedule. A signed order, by contrast, would give Illinois brokers and trading desks roughly six additional months to recalibrate systems, disclosures, and broker-collection workflows before any levy activates.