The legal fight over Illinois’ tax on cryptocurrency activity is moving toward a faster resolution. On October 13, 2026, the Blockchain Association (BA) and the Crypto Council for Innovation (CCI), along with the State of Illinois, the Digital Chamber (TDC), and the Illinois Blockchain Association (IBA), asked a state court to put both pending lawsuits against the Digital Asset Tax Act on an expedited schedule.
The request came in a joint motion filed in the Circuit Court of Sangamon County, the state trial court based in Springfield, Illinois. The parties propose resolving the dispute through summary judgment, a procedure in which a judge decides a case on written legal arguments, without a full trial, when the key facts are not in dispute. According to the Blockchain Association’s press release, the schedule still needs the court’s approval.
What the Proposed Court Schedule Looks Like
The motion covers two cases. The first, brought by the Chamber of Digital Commerce, which operates as The Digital Chamber, and the Illinois Blockchain Association, is Case No. 2026 MR 000271. The second, filed by BA and CCI, is Case No. 2026 MR 000312. The filing notes that Illinois has moved to consolidate the two cases before the same court.
Under the proposed timeline:
- The industry plaintiffs will file two separate summary judgment motions by November 4, 2026.
- The State will file one combined response, including any cross-motion, by December 18, 2026.
- The plaintiffs will file their replies by January 8, 2027.
- The State will file any final reply by January 22, 2027.
- The parties asked for a hearing between February 8 and February 19, 2027.
- The plaintiffs requested a decision by March 1, 2027.
Illinois Agrees to Pause Enforcement Until July 1, 2027
The most significant concession in the filing comes from the State. Illinois officials have agreed to an injunction, a court order that blocks a law from being applied, which stays the effectiveness and enforcement of the tax until July 1, 2027. The levy was originally set to begin on January 1, 2027.
In return, BA and CCI agreed not to press for immediate preliminary relief. The two groups had filed a motion for a preliminary injunction on September 9, 2026, arguing that firms were already spending heavily to build compliance systems without clear guidance.
The new agreement builds on an earlier arrangement in the Digital Chamber case, where state officials had already agreed to delay the Digital Asset Tax to July 2027.
The plaintiffs say an early ruling matters because businesses may need months to adjust operations or file an appeal if they lose. The filing also states that they reserve the right to seek an extension of the stay if the court cannot rule by March 1.
Industry Leaders Want a Ruling on the Merits
Summer Mersinger, Chief Executive Officer of the Blockchain Association, said the pause protects Illinois consumers and businesses while the court weighs the case. She argued that a tax treating digital assets differently from other assets violates federal and Illinois law. “We look forward to making our case on the merits,” Mersinger said.
Ji Hun Kim, Chief Executive Officer of CCI, said the pause is welcome but stressed that the legal questions still need a quick answer. He said businesses should not have to rebuild operations or face the threat of criminal penalties under a tax the group considers unconstitutional.
The State’s legal defense of the tax will be set out in its response brief, due December 18, 2026, under the proposed schedule.
What Illinois’ Digital Asset Tax Act Does
Governor JB Pritzker signed the measure into law in June 2026 as part of the state’s fiscal year 2027 budget. The Digital Asset Tax Act sits in Article 3 of Public Act 104-0468.
The law places a 0.2% tax on the privilege of receiving digital asset business activity, such as the exchange, transfer or storage of crypto, from a digital asset broker. The tax is calculated on the value of the asset involved, not on profit. That means a customer could owe it even on a losing trade.
Illinois projects roughly $60 million in annual revenue from the tax, against more than $224 billion in total appropriations, according to figures cited by BA and CCI.
Meanwhile, the Illinois Department of Revenue (IDOR) published draft proposed rules for the tax on September 28, 2026, and is accepting public comments through October 30, 2026. The department notes that the draft has not yet been filed with the Illinois Secretary of State or the Joint Committee on Administrative Rules (JCAR), the legislative body that reviews state agency rules.
The tax has drawn criticism beyond trade groups. Commodity Futures Trading Commission (CFTC) Chairman Michael Selig called it a threat to innovation, and Coinbase Chief Executive Officer Brian Armstrong warned it could cost the state tech jobs.
The Legal Arguments Against the Tax
BA and CCI filed their lawsuit on August 21, 2026. Their complaint argues that the Act violates:
- The U.S. Constitution, including the dormant Commerce Clause, a legal doctrine that bars states from unfairly burdening commerce across state lines.
- The Illinois Constitution.
- The federal Internet Tax Freedom Act (ITFA), which prohibits discriminatory state taxes on electronic commerce.
- The due process clauses of both the Illinois and U.S. constitutions.
The groups have named Illinois Department of Revenue Director David Harris, Attorney General Kwame Raoul and Sangamon County State’s Attorney John Milhiser as defendants, all in their official capacities.
The Digital Chamber brought the first legal challenge to the tax in July 2026, arguing that no one should be taxed differently based on how ownership of an asset is recorded. The Crypto Times reported at the time that the group described the levy as unconstitutional. The Illinois Blockchain Association later joined that case as a co-plaintiff.
What Comes Next
If the court approves the schedule, the first summary judgment motions will be due on November 4, 2026. A ruling by March 1, 2027, would leave about four months before the paused tax is due to take effect.
The outcome may matter beyond Illinois. A ruling upholding the tax could give other states a template for taxing crypto activity directly, while a ruling against it would set an early limit on state-level crypto levies. For now, digital asset brokers serving Illinois customers have more time, but no final answer.
Also Read: French Lawmakers Back 31.4% Tax on Crypto-to-Stablecoin Conversions
