Jake Leahy

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Jake Leahy

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Illinois’s two new taxes aimed at the digital economy do not take effect until January 1, 2027. They are already in court.
On September 11, 2026, NetChoice filed two separate complaints in the Circuit Court of Cook County, Chancery Division, challenging provisions enacted through Public Act 104-468. One case challenges Illinois’s new Targeted Advertising Services Tax. The other challenges what the statute calls a “social media platform fee,” which NetChoice argues is a tax for purposes of federal law.
Both lawsuits seek declaratory and injunctive relief before the new provisions become enforceable. At this point, these cases

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Continue Reading Illinois’s New Digital Taxes Are Already in Court

A wooden gavel on a white marble backdrop.
Tingey Injury Law Firm, Unsplash
Illinois municipalities have several ways to annex unincorporated property. One of the most consequential is Section 7-1-13 of the Illinois Municipal Code, which permits a municipality, without a landowner’s consent, to annex certain unincorporated territory containing 60 acres or less if the territory is “wholly bounded” by one of several combinations of municipalities and other specified land. In the provision at issue in Husky Trans, Inc. v. Village of Barrington Hills, the qualifying boundaries are one or more municipalities together with a forest preserve district or park district. 65 ILCS 5/7-1-13(a)(e).
The Illinois Supreme Court is now considering a deceptively

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Continue Reading Forced Annexation in Illinois: Supreme Court to Decide Whether a Boundary Gap Can Be “De Minimis”

The federal employer credit for paid family and medical leave was scheduled to expire after 2025. Congress instead made the credit permanent and substantially changed how employers may calculate it. For taxable years beginning after December 31, 2025, an eligible employer may continue to calculate the credit based on wages paid to employees while they are on qualifying leave, or elect a new method based on premiums paid for qualifying paid-family-and-medical-leave insurance.
Treasury and the IRS addressed the new premium method in Notice 2026-28, 2026-34 I.R.B. 177. The guidance provides employers with rules they may rely upon while Treasury

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Continue Reading IRS Notice 2026-28: New Guidance on Calculating the Paid Family and Medical Leave Credit

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Wesley Tingey, Unsplash
The Supreme Court’s decision in Tyler v. Hennepin County arose from a property tax foreclosure. Its influence may extend well beyond delinquent taxes.
In BBLI Edison, LLC v. City of Chicago, No. 25-1713 (7th Cir. July 22, 2026), the Seventh Circuit considered whether Chicago may require the purchaser of a foreclosed apartment building to pay $10,600 to each tenant who declines to enter a new lease. The court upheld the ordinance under existing landlord-tenant precedent. Its opinion nevertheless contains an unusually direct acknowledgment that the Supreme Court has been expanding the circumstances in which government action may implicate the

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Continue Reading When Does Government Regulation Become an Unconstitutional Taking? The Seventh Circuit’s Answer After Tyler

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Conny Schneider, Unsplash
The first major legal challenge to Illinois’ newly enacted Digital Asset Tax Act has arrived.
On July 21, 2026, the Chamber of Digital Commerce d/b/a The Digital Chamber filed a lawsuit in the Circuit Court of Sangamon County seeking to invalidate Illinois’ controversial digital asset tax before it takes effect on January 1, 2027. The suit names David Harris, Director of the Illinois Department of Revenue, and Kwame Raoul, Illinois Attorney General, as defendants and seeks both declaratory and injunctive relief preventing enforcement of the law.
Background: Illinois’ New Digital Asset Tax
A Illinois recently became the first state in

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Continue Reading First-in-the-Nation Illinois Digital Asset Tax Faces Constitutional Challenge

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Wes Hicks, Unsplash
Illinois has joined the growing national fight over prediction markets. It did so through Senate Bill 3019, a revenue and gaming measure that attempts to bring sports-related prediction-market contracts within the Illinois Sports Wagering Act. KalshiEX LLC has now sued the Governor, Attorney General, and Illinois Gaming Board officials in federal court, arguing that Illinois has stepped into a field Congress gave to the Commodity Futures Trading Commission.
When this tax was originally proposed under SB 4168 was first flagged when it was proposed in April. Now it come as no surprise that Kalshi is challenging the tax that

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Continue Reading Can Illinois Tax Prediction Markets? Kalshi’s Federal Lawsuit Tests the Boundary Between Sports Wagering and Federal Derivatives Law

A recent federal decision out of Arizona offers a useful reminder about the tax treatment of settlement payments, as well as risks that arise when settlement agreements fail to address tax characterization clearly.
In Adusei v. Auer, a former nursing student sued a college, its attorneys, and others after Forms 1099 were issued following settlement of earlier litigation. The plaintiff alleged the settlement funds should have been treated as non-taxable educational reimbursements rather than taxable income. She asserted a wide range of claims, including fraudulent tax reporting, malpractice, emotional distress, discrimination, abuse of process, and violations of criminal statutes.

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Continue Reading Settlement Agreements, Forms 1099, and Tax Trouble: Lessons from Adusei v. Auer

Just this morning, the IRS just announced a new, time-limited settlement initiative for conservation easement and historic preservation easement cases. And the agency is making clear that it views continued litigation as increasingly risky for taxpayers.
The new initiative offers eligible taxpayers significantly more favorable terms than the results taxpayers have generally achieved in Tax Court. Under the program, eligible partnerships may resolve cases with no charitable contribution deduction, but with an “other deduction” for approximate out-of-pocket costs and a substantially reduced gross valuation misstatement penalty, that is, 10% during the initial 90-day window, increasing to 20% during a subsequent

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Continue Reading IRS Announces New Conservation Easement Settlement Initiative as Litigation Pressure Mounts

The proposed tax break for the United Center’s 1901 Project has been described as a $55 million subsidy for the owners of the Chicago Bulls and Chicago Blackhawks. That is understandable shorthand, but it is not the precise tax mechanism.
The proposal is a Cook County Class 7(b) property tax incentive. It does not write the owners a check. It would reduce the property’s assessment level for 12 years, which in turn lowers the property tax bill that would otherwise apply to the first phase of the project.
That distinction is key, because Class 7(b) is an existing Cook

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Continue Reading United Center’s 1901 Project Shows How Chicago Property Tax Incentives Really Work

The IRS released PLR 202619013 on May 8, 2026. A limited partnership taxed as a partnership had a partner die. The partnership inadvertently failed to make a Section 754 election for the relevant tax year. The partnership then requested late-election relief under Treas. Reg. § 301.9100-3. The IRS granted the partnership 120 days from the date of the letter to make the election effective for that year.
A Section 754 election allows partnership property basis adjustments under Section 734(b), for certain distributions, and Section 743(b), for certain transfers of partnership interests. The election is made by

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Continue Reading IRS Grants Late Section 754 Election Relief After Partner’s Death: Practical Lessons for Partnerships

Federal law generally prohibits candidates from using campaign funds for personal expenses. But under a narrow exception administered by the Federal Election Commission, certain nonincumbent federal candidates may receive compensation from their campaign committees during the course of a campaign.
The rule is intended to make federal office more accessible to candidates who otherwise would lose income by leaving employment or reducing work to campaign full-time. At the same time, the FEC has repeatedly emphasized that campaign salary is not a general living stipend and cannot become a mechanism for converting campaign funds into personal income.
That tension explains why

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Continue Reading Can Federal Candidates Use Campaign Funds to Pay Themselves?

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kate.sade, Unsplash
Alexander County had the highest annual average unemployment rate in Illinois in 2025 at 6.8%, followed by Pulaski County at 6.0% and Macon County at 5.8%, according to the Illinois Department of Employment Security. Monroe County had the lowest rate at 3.0%. Statewide, Illinois’ annual average unemployment rate was 4.6%, compared with 4.3% nationally.
A county unemployment rate is not the same thing as the percentage of adults without jobs. IDES reports these figures through the Local Area Unemployment Statistics program, which estimates the labor force, employment, unemployment, and unemployment rate for counties and other local areas. The unemployment

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Continue Reading Illinois County Unemployment Rates 2025: Full Ranking from Highest to Lowest

Person holding a modern credit card payment terminal device for secure electronic transactions in business environment
Blake Wisz, Unsplash
Illinois’ first-in-the-nation Interchange Fee Prohibition Act has become more than a dispute over credit card “swipe fees.” It has since evolved into a test of state authority, federal banking preemption, payment-card infrastructure, and the practical limits of regulating national payment systems one state at a time.
The Illinois Interchange Fee Prohibition Act or IFPA, is scheduled to take effect on July 1, 2026. In general terms, the Act prohibits an interchange fee from being charged or received on the portion of a credit or debit card transaction attributable to taxes or gratuities. That means, for example, that if a customer

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Continue Reading Illinois Swipe Fee Law Update: Federal Agency Action Adds Uncertainty Before July 1

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Alexander Grey, Unsplash
A proposed Illinois constitutional amendment that would impose a 3% surtax on income over $1 million is no longer just an introduction. It is now moving through the House.
As of yesterday (April 21, 2026), the resolution passed out of the House Revenue & Finance Committee (13–7) and has been read a second time, where it now sits on the House calendar for short debate. A hearing is also scheduled, signaling that leadership is at least willing to keep the proposal in play.
Substantively, the measure remains straightforward. It would amend the Illinois Constitution to impose an additional 3% tax

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Continue Reading Illinois “Millionaire Surtax” Draws Opposition from Business Groups as Amendment Advances

On April 6, the Supreme Court denied certiorari in Stroble v. Oklahoma Tax Commission. The denial leaves in place an Oklahoma Supreme Court decision allowing the State to tax a Muscogee (Creek) Nation member who works for the Tribe on trust land but resides on unrestricted fee land within the reservation recognized in McGirt.
The question presented was ultimately not whether McGirt recognized a reservation (it did) but instead, whether that recognition carries through to state income taxation. The Oklahoma Supreme Court answered no. The Court declined review.
Arguments Presented on the Petition for Certiorari
The amicus brief filed by

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Continue Reading Supreme Court Denies Certiorari in Stroble v. Oklahoma Tax Commission

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Alexander Grey, Unsplash
Illinois lawmakers are moving to regulate, and heavily tax, prediction markets. Prediction markets are a fast-growing corner of online wagering that has largely operated outside traditional gaming frameworks.
Senate Bill 4168, introduced by State Sen. Michael Hastings on March 5, 2026, would create a new Prediction Markets Regulation and Taxation Act, requiring any platform offering prediction contracts to Illinois users to obtain a license from the Illinois Gaming Board and pay a $1 million upfront fee and $1 million annual renewal.
The bill is currently pending in Assignments and State Sen. Cristina Castro has been added as a

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Continue Reading Illinois Bill Targets Prediction Markets With 50% Tax and $1M License Fee (SB 4168)