Small Business Majority supports expanding the Illinois State Earned Income Credit (EIC) to benefit entrepreneurs

Thursday, April 1, 2021

A year into the pandemic, many small businesses in Illinois continue to struggle to keep their doors open. While government funding programs have provided a crucial lifeline for many businesses, one-off funding opportunities are not going to be enough to support the long-term recovery of our small business economy. The proposed Illinois Earned Income Credit (EIC) expansion would help address this by closing the gaps in federal funding relief programs and putting more money into the pockets of  low-income and working-class Illinoisans. This would directly benefit solo entrepreneurs, small business owners and their employees. 

Senator Elgie Sims and Representative Carol Ammons have introduced legislation (HB2792/SB2814) that will expand eligibility for the Illinois EIC to more individuals. Here’s how: 

  • Increased income: EIC puts money back in people’s pockets through a state tax refund for individuals who are already eligible for the federal Earned Income Tax Credit (EITC) and who have personal incomes of $56,844 or less. This also includes eligible small business owners or self-employed individuals who may benefit. This legislation will expand the Illinois EIC for people ages 18-24 and over the age of 65. Individuals with qualifying children may receive up to $6,600 EITC money from their state taxes.  
  • Support for small business recovery and sales: The Illinois EIC has been shown to boost demand at local small businesses. Consumers spend up to two times each dollar invested in Illinois EIC at neighborhood small businesses. In return, small businesses are known to invest as much as 52% of these revenues back into the community.
  • Support eligible small business owners who are caregivers: For those who qualify for both the federal EITC and Illinois EIC, the legislation proposes a minimum $600 credit to caregivers of qualifying dependents, which includes children under age 6, older adults and dependents with disabilities.

A sustainable economic recovery lies in the hands of our local small businesses. HB2792 and SB2814 would equitably enhance COVID-19 economic recovery for low-income communities, and would not only benefit small business owners, but also solo entrepreneurs and small business employees. 

Why small business owners support Illinois EIC expansion

  • Nichole Jackson, owner of Bronzeville Wingz"As a small business owner, anything that can help my employees offset their cost of living is helpful for them and our economy because the majority of workers in my industry make under $35,000."
  • Leslie Allison-Seei, owner of Robust Promotions, LLC: “Expanding the EIC makes sense. If you put more money into the pockets of hard-working Illinoisans, they will use it to pay rent, utilities and buy goods from small businesses that keep the economy going.”
  • Alan Moy, owner of Viet Nom Nom: “EIC would definitely help lift the financial boat of our core younger workers who are ages 18-24 with incomes that may qualify for the credit.”

Small Business Majority is a member of the Illinois Cost-of-Living Refund Coalition to expand the state’s Earned Income Credit.