Gina Parrilli, a Republican candidate for the Illinois 45th House District, said Illinois workers will continue paying state income taxes on tips and overtime after lawmakers declined to adopt provisions of the One Big Beautiful Bill Act (OBBBA) that allow those earnings to be deducted at the federal level.
The federal law allows eligible workers to deduct up to $12,500 per individual and $25,000 for married couples in qualified tips or overtime from their federal taxable income for tax years 2025 through 2028.
Despite the impact on workers, Illinois lawmakers have declined to conform to the federal provisions, keeping those earnings fully taxable at the state level.
“I believe what the state of Illinois is doing by not following federal law hurts families in the state,” Parrilli told the DuPage Policy Journal. “Rising costs and repeated tax increases will result in families having less disposable income. Illinois has a spending problem, which leads to more taxes on residents, driving more outward migration to other, more tax-friendly states.”
While several states have adopted the provisions, Illinois and other Democratic-led states, including New York, California and Colorado, have not.
In a Dec. 10 statement, Treasury Secretary Scott Bessent accused Illinois and other Democratic-led states of denying workers tax relief.
“President Trump’s tax cuts bill is the most pro-worker, pro-family legislation in a generation,” Bessent said. “It puts more money directly into the pockets of hardworking Americans through No Tax on Tips for dedicated service industry staff, No Tax on Overtime for linemen and factory workers, and a new tax deduction for seniors who depend on Social Security.”
According to the Bureau of Labor Statistics, the tax issue affects 86,200 waiters and waitresses and more than 100,000 app-based drivers in Illinois whose tip income remains subject to state taxation.
Overtime income is also affected, impacting more than 576,000 manufacturing workers in the state, according to estimates from the Illinois State University Census Data Center, along with other workers who regularly earn overtime pay.
Parrilli said the decision not to extend the federal deductions to state income taxes places an additional burden on working families.
“By not following federal law, this puts more stress on families,” she said. “With Illinois now having the highest property taxes in the country, it is unsustainable for a family to succeed, especially if they are on the lower end of the income scale, the same people our governor pretends to work for. The state of Illinois has a spending problem.”
Parrilli said the state’s decision reflects broader fiscal policies she argues are harming middle- and working-class families.
“This leads to less disposable income after income, sales, and property-related taxes,” Parrilli said. “Increased financial instability during slow seasons. Greater reliance on using credit or the need to supplement income with a secondary job. Families may leave the state and move to a state that is more tax-friendly and not burdensome with high taxes, as Illinois now has the highest property taxes in the country, the second-highest gas tax, and the highest cell phone taxes. If the politicians are not serious about fixing Illinois, more residents will leave.”
Parrilli, who is challenging Democratic incumbent state Rep. Martha Deuter in the 2026 election, said the refusal to adopt federal tax relief measures is one factor driving residents and businesses out of Illinois.
“If tax reform is truly sustainable in the state of Illinois, there are many challenges it needs to address,” she said. “Fiscal responsibility must be a top priority, and cutting spending and giving out raises to politicians must stop. We need to condense taxing bodies, as Illinois is close to having 6,963-8,923 in the state. We need to make Illinois a tax-friendly state.”
Since Gov. J.B. Pritzker took office in 2019, Illinois has enacted 49 tax increases, and per-resident tax collections have increased 44%, according to Illinois Policy.
Illinois Policy also reports the state has the highest combined state and local tax burden in the nation, with median-income households paying about $13,099 annually, or roughly 52% above the national average.
Despite collecting $717 million more than expected in 2025, Illinois continues to pursue higher taxes, including a proposed $482 million increase in the 2026 budget.
Parrilli, a Westmont trustee, has opposed local tax increases. She cast the lone “no” vote on the village’s 2026 property tax levy at a Nov. 20, 2025, Westmont Village Board meeting, citing Illinois’ overall tax burden and its impact on residents. The 4.89% increase raised the village levy by $11.3 million.
“The state of Illinois is not performing well,” she said at the time. “We already face the highest combined state and local tax burden, including the highest property taxes. In all good conscience, I cannot vote in favor of an increased tax levy.”
Parrilli said her campaign platform focuses on tax relief, reducing government spending and supporting working families.
The 45th House District is primarily located in DuPage County, with a portion extending into Cook County, and includes Elmhurst, Westmont, Oak Brook, Hinsdale, Clarendon Hills, Downers Grove, Addison, Oakbrook Terrace, Willowbrook and Villa Park.
