Illinois residents will see new laws as the year changes to 2021. It’s important to know what will change and what will be introduced in the new year so you can be well-informed about your state’s laws.
The laws that Illinois residents can expect to see are about employers and discrimination claims, minimum wage rates, and updates on potential tax increases. Let’s take a look at the 2021 new laws and law changes.
Laws on Employers and Discrimination Claims
For discrimination or sexual harassment matters that happened in 2019, employers had until October 1, 2020 to submit the reports to the Illinois Department of Human Rights. This is a requirement for any final, adverse judgements, or administrative rulings entered against them.
This extends into 2021. By July 2021, and before July of each following year, employers need to have these reports filed for the previous year.
For those who currently earn minimum wage, they’ve already experienced a wage increase in 2020. The wages increased from $9.25 to $10 per hour. With each new year, the increase will be by $1. This pattern will continue until 2025, when the minimum wage increase will reach $15.
Proposed Tax Increase Rejected
Illinois has lost revenue this year because of the COVID-19 pandemic. It’s affected the state in a way that no one could have budgeted or predicted. With businesses being shut down and everyone told to stay at home for a time, many businesses struggled. While there are slightly different protocols now, with businesses at reduced capacity and people going out in masks, the situation is still precarious.
Many people may still be sheltering in place, working from home, and are planning to do so until the pandemic is over. During this time, the Illinois governor has estimated that the state has lost $6.5 billion.
There was a proposed tax increase plan that could help bring more money to the state. The current tax rate system is a flat rate, which means everyone pays the same rate of taxes, no matter how much they make. The current tax rate is 4.95%. The proposal was to change the flat rate tax plan to a graduated rate system. This could mean the rate of taxes would increase as income rises.
A quick summation of the plan concludes with single and joint filers making less than $250,000 a year would likely not see a change in their taxes and would pay 4.95%. About 97% of the people in Illinois would pay about the same or less for state income taxes.
It seemed that the bill had a lot of support. Mainly, the focus was that those who were earning a high income would be paying their fair share of the taxes. This also would allow the state to use that money to benefit the residents of Illinois.
However, there was a lot of opposition as well. They viewed the graduated rate as writing the state government a blank check. With a history of difficulty with budgeting, some voters may have not been optimistic about the government’s ability to provide that wealth back to the people.
Voters made their voices heard about this issue during the 2020 Presidential Election. About 45% were in favor of the plan and 55% voted against it. Since the tax plan didn’t pass, the state will now have to look into other ways to deal with the significant losses of the state from the past year.
Others are also saying that while the pandemic made the issues even worse, there were still structural issues with the tax system that were putting financial strain on Illinois residents. If the state’s budget crisis doesn’t have an answer, then lawmakers may be in a position where they have to look at raising taxes for everyone by at least 20%. Everyone could face this increase, income notwithstanding.
Lawmakers know that this will negatively impact and be nearly impossible for some middle and lower income families. The 20% increase would bring the 4.95% rate to 5.94%.
As the new year approaches, Illinois state government will need to figure out their plan to help guide the state through these uncertain times. This also includes formulating a new state budget for the upcoming fiscal year. There will likely be more bills proposed to help Illinois get back on track.
Prince Law Firm is following what new laws and law changes will go into effect in the new year. We’re dedicated to staying up to date with state laws. If you have any questions about Illinois laws, you can get in touch with us here.
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