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December 16, 2025
The provision is estimated to save Illinois businesses $500 million a year
Governor JB Pritzker signed into law legislation to extend the Illinois SALT (State and Local Taxes) workaround provision on December 12th.
The provision was part of a larger tax omnibus bill that also decoupled Illinois from new federal bonus deprecation provisions passed by Congress this summer.
Formally known as the Pass-Through Entity Tax (PTET), the SALT workaround permits Illinois pass-through businesses to deduct state taxes from their federal tax returns. When originally passed, the General Assembly inserted a sunset clause into the provision that would have caused it to automatically expire at the end of 2025 unless extended.
The Taxpayers’ Federation of Illinois estimates the SALT workaround saves Illinois businesses approximately $500 million a year.
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