Imagine owning a successful business, stocks, or real estate that increases significantly in value. You haven’t sold anything, and you haven’t received any money from that appreciation.
But what if the government wanted to tax you on that increase anyway?
That’s the idea behind Illinois Senate Bill 3376, introduced on February 4, 2026, which proposes changes to how certain very wealthy Illinois residents are taxed.
The proposal raises questions about taxation, investment, business ownership and where people choose to live.
What Is Illinois Senate Bill 3376?
Illinois SB 3376 would create the Extremely High Wealth Mark-to-Market Tax Act, addressing individuals who meet its resident-taxpayer definition and have net assets of $1 billion or more under its rules.
An unrealized gain is an increase in the value of something you own but haven’t sold.
Traditionally, investors generally pay capital gains taxes when they sell an appreciated investment and realize a profit.
The introduced bill generally treats covered assets as sold at year-end fair market value, with net-income inclusion limited by a phase-in cap and subject to adjustment rules. It is not a flat tax on total wealth.
Why the Rate Is Not the Whole Calculation
Illinois currently taxes individual net income at 4.95%. That rate alone does not establish the tax due under SB 3376: its proposed calculation rules and the taxpayer’s circumstances also matter.
Why Does This Matter?
The proposal raises several questions:
- How would asset values be established?
- How would affected taxpayers fund payments?
- Could it influence investment or residency decisions?
- Would any provisions face legal challenges?
These are questions for discussion, not established outcomes or attributed statements from supporters or critics.
Could This Encourage More People to Leave Illinois?
Whether the proposal would influence anyone’s decision to move is unknown. People consider many factors when relocating, including family, business operations, employment and lifestyle. This article does not establish that SB 3376 has caused or will cause moves to Nevada.
Why Nevada Enters the Conversation
Nevada offers a very different individual income tax environment, compared side by side on our Illinois vs. Nevada taxes guide.
Nevada has no individual income tax, but sales, property, business and other taxes and fees still apply. Federal taxes and tax obligations in another state may also apply.
For individuals relocating from higher-tax states, that difference can be meaningful.
Las Vegas and Henderson also offer a variety of residential options, from established neighborhoods to luxury communities and custom homes.
Of course, moving to Nevada doesn’t automatically eliminate tax obligations in another state. Properly establishing residency and understanding the tax treatment of existing business interests and assets are essential.
Will This Affect Ordinary Homeowners?
Home appreciation alone does not establish coverage. The introduced bill uses a $1 billion net-asset threshold and specific resident-taxpayer and asset definitions; being a homeowner is not itself an exemption.
This raises a policy question: when, if ever, should unrealized appreciation be included in taxable income?
Has the Bill Become Law?
As of October 29, 2026, SB 3376 has not been enacted. It remains a legislative proposal, not an existing tax obligation.
It is important to distinguish a proposed tax from an existing tax obligation. See our guide to Illinois tax and fee changes for measures that are already in effect or scheduled.
The Bigger Picture: Where You Live Matters
For many Americans, choosing where to live is about more than finding the right home.
It’s also about lifestyle, financial planning, retirement, business opportunities, and the cost of living.
Illinois Senate Bill 3376 illustrates how proposed state tax policies can become part of those decisions, particularly for business owners and investors.
Whether the bill advances or not, understanding the financial differences between states is an important part of planning a relocation.
Considering a Move to Las Vegas or Henderson?
As a Las Vegas real estate professional, I help buyers explore communities, compare housing options, and understand the local real estate market. See our moving guide for the steps.
If you’re considering relocating to Southern Nevada, I’d be happy to help you explore your options.
Disclaimer: This article is for informational purposes only and does not constitute legal, tax, or financial advice. Consult a qualified tax professional before making residency or investment decisions.
