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Illinois Introduces Tax Credit to Offset the Increased Minimum Wage

On January 1, 2020, the IL minimum wage increased from $8.25 to $9.25 per hour. A second increase, to $10.00 per hour, begins on July 1, 2020. It is then set to increase by $1 on January 1st of each year until it reaches $15.00 per hour.
Beginning with the first quarter of 2020, Illinois adopted a tax credit to help offset the higher labor cost associated with the increase in the minimum wage. In order to be eligible for the credit, an employer must meet the following two criteria:
The employer must have 50 or fewer full-time equivalent employees, and
The average wage per employee making less than $55,000 per year in 2020 must be more than the average wage paid per employee during the same reporting period in 2019.