HB1750, filed by Rep. Joe Sosnowski of Rockford, proposes a straightforward change to the Illinois Income Tax Act: exempting both tip income and overtime compensation from state taxation. If enacted, HB1750 would allow workers to deduct these earnings from their Illinois taxable income, effectively increasing take-home pay for thousands of residents. The bill is a commonsense measure to reward hard work and provide immediate relief to those who often work irregular hours or depend on tips to supplement low base wages.
“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.”
Joining Sosnowski in this effort are Rep. Jennifer Sanalitro and Rep. C.D. Davidsmeyer, both of whom have introduced their own bills to address this need. Sanalitro’s HB1898 and Davidsmeyer’s HB2735 both also seek to remove state income tax obligations on gratuities reported to the IRS.
The rationale behind these bills is rooted in economic fairness. In industries like hospitality, food service, and personal care, tips can make up a significant portion of a worker’s income. According to the Illinois Restaurant Association, the state is home to more than 77,000 restaurant servers alone, many of whom rely on gratuities to bridge the gap between base pay and a livable wage. For these workers, every dollar counts, and taxing tips can feel like a penalty for providing good service. Overtime pay, similarly, is often earned by those who take on extra shifts or work beyond standard hours to support their families. By removing state taxes on these earnings, lawmakers argue that Illinois can offer meaningful, immediate relief to those who need it most.
These bills are about dignity and respect for labor. In a time when inflation continues to squeeze household budgets and the cost of living rises across the board, allowing workers to keep more of what they earn is a direct way to support economic stability. The proposals also reflect a broader trend among Republican lawmakers to prioritize tax cuts that benefit everyday workers. By focusing on tips and overtime, the bills target income streams that are often overlooked in broader tax debates but are vital to the financial health of working-class families.
For now, the House GOP plan represents a clear and focused attempt to make Illinois a more worker-friendly state. Whether it’s a bartender pulling a double shift, a delivery driver hustling for extra tips, or a nurse clocking overtime to cover staffing shortages, these bills send a powerful message: your extra effort matters, and you deserve to keep more of what you earn.