Illinois recently introduced a state-wide tax rebate aimed at active volunteer firefighters. This tax credit offers a $500 non-refundable credit to eligible firefighters, distributed on a first-come, first-served basis.
Eligibility and Application Process
The “Volunteer Emergency Worker Credit,” announced in April, allows volunteer firefighters who meet certain criteria to reduce their 2023 income tax liability by $500. To qualify, firefighters must have served their organizations for at least nine months and earned less than $5,000 in compensation as a volunteer emergency worker in the past year.
A certification from the fire chief is required to verify the firefighter’s service, and applicants must apply for the credit. Detailed information and the application process are available on the Illinois Department of Revenue (IDOR) website.
This credit is applied to the state income tax before any withholding or refundable credits. However, as it is non-refundable, it cannot result in a refund. Additionally, those who already receive a property tax credit or K-12 education expense credit that reduces their tax liability to zero are ineligible for this new credit. The credit is also non-transferable, meaning it cannot be passed on to another taxpayer.
The total annual amount available for this credit is capped at $5,000,000, allowing up to 10,000 firefighters to benefit each year. Since the credit is awarded on a first-come, first-served basis, early application is recommended.
The Importance of the Tax Credit
This initiative is part of Illinois’ efforts to address the ongoing shortage of first responders, a challenge faced across the country. The National Volunteer Fire Council reports that the number of volunteer firefighters hit a record low in 2020.
Challenges such as increased training and time commitments, reduced availability of volunteers, migration from small towns and rural areas, and the demands of multiple jobs have made recruitment and retention of firefighters more difficult. On average, it takes about 18 months to fully train a volunteer firefighter.
In response to these challenges, Illinois and several other states have implemented similar tax credits to encourage more individuals to volunteer as firefighters.