New Illinois Laws Taking Effect in January 2026

A new year means a new swath of laws will be going into effect across all 50 states, and that includes Illinois. Recently, WGN published an article breaking down the major changes to Illinois legislature beginning on January 1st, 2026. I decided to condense the information of the most significant laws below.

The handful of these laws tackle a variety of different subjects, from AI, nursing mothers, and a controversial grocery tax. Let's dive deeper into new laws taking effect in Illinois at the start of the new year (reminder: it's a little over three weeks away!).

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Regulation of Artificial Intelligence in the Employment:

One of the most significant laws taking effect in Illinois in 2026 is in regards to artificial intelligence being used in employment decisions. House Bill 3773 amends the Illinois Human Rights Act to make it a civil rights violation for employers to use AI tools in significant employment decisions that result in discrimination based on race, gender, age, or disability.

This extends beyond the hiring process. It includes promotions, discipline, termination, and more. Companies are required to notify workers when AI technology is deployed and explain how it was deployed. Enforcement of the law is up to the Illinois Department of Human Rights (IDHR).

The Fall of the 1% State Grocery Tax:

Part of the FY2026 Budget Bill, a new law repeals Illinois' 1% tax on groceries, which would help alleviate the cost of necessities for people at a time when prices continue to rise.

That said, in its current state, the law allows municipalities and counties to impose their own local 1% grocery tax. Per WGN, 656 municipalities adopted an ordinance to establish a localized 1% tax. In essence, this is shifting the burden of responsibility on imposing this tax from the state to local governments.

Nursing Mothers in the Workplace Act:

Senate Bill 0212 states that employers must pay nursing mothers for break time used to produce breast milk for up to one year following the birth of their child. Prior to this law, employers had no requirement to compensate nursing mothers. Now, they must be compensated at the regular rate.

Corporate Tax Changes:

The aforementioned FY2026 Budget Bill will pivot Illinois to the "Finnigan" method for combined tax reporting for corporations. That is expected to increase taxable income for the state's largest corporations.

Changes Coming to Prescription Coverage:

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Per WGN, insurance polices issued in 2026 must cap out-of-pocket costs for prescription inhalers. In addition, the law requires coverage of brand new drugs during times when there are shortages of generic alternatives, and cap the price of epinephrine auto-injector twin-packs to $60. These moves are set to make life-saving medicines more affordable and far less cost-punitive for people who need these drugs to function.

See more of the laws taking effect in Illinois in 2026 on WGN's website.