Illinois

As we kick off a new year, several states are facing revenue shortfalls. Some lawmakers are approaching the challenge with sustainable and equitable solutions.

With a little over a week left, some states are solidifying their spots on the tax policy “naughty or nice” list.

It’s wildly inappropriate for a U.S. Treasury Secretary to lean on states to adopt or not adopt specific federal provisions in their own state tax codes.

States are increasingly facing difficult choices as revenues stagnate and deficits come clearer into focus.

An unknown number of workers who previously were assumed to be ineligible for the tax break may nonetheless claim it.

Lawmakers in two more states have wisely said “no thank you” to federal tax cuts that would have flowed through to their state tax codes and undermined funding for their priorities

Revenue forecasts look increasingly grim as states anticipate shortfalls due to the slowing economy and impacts of the new federal tax law.

Despite being an off-year election, voters made a call for shared public investments at the polls.

States across the nation are debating how best to respond to costly new federal tax cuts.

Local governments have a critical role to play in reducing child poverty. Local Child Tax Credits could provide large tax cuts to families at the bottom of the income scale, lessening the overall regressivity of state and local tax systems.

State and local officials are staying very busy by considering a dizzying amount of reversals.

Some states are trying to avoid revenue loss while others are welcoming it and doubling down.

Nearly two-thirds of states now have an Earned Income Tax Credit (EITC). Momentum continues to build on these credits that boost low-paid workers’ incomes and offset some of the taxes they pay, helping lower-income families achieve greater economic security.

While tax news has slowed as summer comes to an end, there are rumblings beneath the surface that could be an inauspicious sign of the times ahead for states and state budgets.

The Trump megabill hands the richest 1% a trillion-dollar windfall while gutting funding for health care, education, and disaster relief — leaving communities to pick up the pieces. State and local leaders must step up, tax the wealthiest fairly, and safeguard the essentials that keep America healthy, educated, and safe.

Federal policy choices on tariffs, taxes, and spending cuts will be deeply felt by all states, which will have less money available to fund key priorities. This year some states raised revenue to ensure that their coffers were well-funded, some proceeded with warranted caution, and many others passed large regressive tax cuts that pile on to the massive tax cuts the wealthiest just received under the federal megabill.

Refundable tax credits were a big part of state tax policy conversations this year. In 2025, nine states improved or created Child Tax Credits or Earned Income Tax Credits.

Sales tax holidays are often marketed as relief for everyday families, but they do little to address the deeper inequities of regressive sales taxes. In 2025, 18 states offer these holidays at a collective cost of $1.3 billion.

If instead of giving $117 billion to the richest 1 percent, that money had been evenly divided among all Americans, we'd each get $343 - or nearly $1,400 for a family of four.

President Trump has signed into law the tax and spending “megabill” that largely favors the richest taxpayers and provides working-class Americans with relatively small tax cuts that will in many cases be more than offset by Trump's tariffs.

As federal aid ends and economic uncertainty grows, local governments face tough budget choices. Now is the time for localities to protect vulnerable residents and build stronger, more equitable fiscal foundations.

The predominant feature of the tax and spending bill working its way through Congress is a massive tax cut for the richest 1 percent — a $114 billion benefit to the wealthiest people in the country in 2026 alone.

The Senate tax bill under debate right now would bring very large tax cuts to very high-income people. In total, the richest 1 percent would receive $114 billion in tax cuts next year alone. That would amount to nearly $61,000 for each of these affluent households.

Many states are reaching their end-of-June budget deadlines, and major tax policy changes look to have big implications as states are forced, per federal policy, to do more with less.