The League of Chicago Theatres & Arts Alliance Illinois Continue Non-Profit Theatre Production Tax Credit

The League of Chicago Theatres and Arts Alliance Illinois have revealed the continuation of the Non-Profit Theatre Production Tax Credit, a state program that allows eligible non-profit theatre companies to receive a tax credit for a portion of their production expenses, including labor, materials, rentals, and more, making producing live theatre more financially viable. The applications for the tax credits are accepted on a rolling basis. 
 
The League of Chicago Theatres and Arts Alliance Illinois are hosting 90-minute webinar at 10:00am on August 26, 2025, designed to guide Illinois non-profit theatres through the newly enacted Non-Profit Theatre Production Tax Credit. The webinar will cover the full application process, eligibility requirements, audit expectations and procedures, and how to work with tax credit brokers — offering critical tools for theatres looking to access this vital new resource. Registration for the free webinar is available at: https://artsalliance-org.zoom.us/webinar/register/WN_1Hkvn0T8T22QR9e7shsBBA#/registration
 
The Non-Profit Theatre Production Tax Credit helps make producing live theatre more financially viable —particularly for small and mid-sized organizations — and encourages more productions to stay and grow in Illinois. Similar to a refund, when a theatre spends money to create a production (costumes, sets, hiring local artists), a portion of the costs can now be reimbursed through the state. If the organization does not owe taxes, they can work with a tax credit broker to sell the credit and turn it into usable funds. 

This program mirrors the structure of Illinois’ successful film production tax credit and is designed to create jobs, support local businesses, and increase cultural tourism throughout the state. 
 
The tax credit, which aims to stimulate economic activity, job creation, and cultural vitality in Illinois’ performing arts sector, was made possible by the tireless efforts of legislative champions and statewide advocates. The League of Chicago Theatres and Arts Alliance Illinois extend deep gratitude to Senator Cristina Castro and Governor JB Pritzker for recognizing the transformative economic and community impact of non-profit theatre. 
 
“Since January 2025, Illinois’ arts and culture sector has experienced significant funding cuts, with reductions in grant programs, cultural workforce development, and operational support for small and mid-sized organizations. While the tax credit is not a replacement for direct public investment, it provides a critical new tool to offset production costs and keep stages lit at a time when many theatres are being forced to scale back programming or close altogether,” explains Marissa Lynn Jones, Executive Director of the League of Chicago Theatres. “The Chicago theatre industry is grateful to our partners at Arts Alliance Illinois, The Illinois Film Office Department of Commerce & Economic Opportunity, along with our elected officials who understand and support theatres as a vital industry in Illinois.”  
 
“The not-for-profit live theater tax credit program will provide essential support to hundreds of theater companies, actors, and stage crew members across Illinois,” said Peter Hawley, Deputy Director of the Illinois Department of Commerce and Economic Opportunity’s Film Office. “With federal arts funding facing significant reductions, this program will help preserve jobs, sustain local theaters, and ensure that live performance remains a vibrant part of communities throughout the state.” 
 

Why It Matters: Theatres Drive Local Economies 

Illinois is home to more than 400 non-profit theatre companies, employing thousands of artists, designers, technicians, and administrators in communities large and small. According to data from Arts Alliance Illinois and the National Assembly of State Arts Agencies, the creative sector contributes over $28 billion (about $86 per person in the US) annually to the Illinois economy, supporting more than 190,000 jobs statewide. 
 
In Chicago alone — the nation's second-largest theatre market after New York — non-profit theatres generate millions in local economic activity each year, filling restaurants, parking lots, and hotels while building long-term cultural capital in neighborhoods across the city. 
 
"Nonprofit theaters are a vital part of Illinois' cultural and economic life, and the Live Theater Tax Credit is a long-overdue recognition of that," said Claire Rice, Executive Director of Arts Alliance Illinois. "Our Help Desk has been working with arts groups through every step of this process to ensure as many theaters as possible can claim these dollars and reinvest them into productions that bring vital cultural experiences to communities across the state." 
 

Advocacy Continues: Push for $5 Million Allocation 

While the passage of the tax credit is a significant victory, the League of Chicago Theatres and Arts Alliance Illinois emphasize the need for sustained investment. As currently enacted, the credit’s funding cap of $2 million limits its reach. Advocates are urging lawmakers to increase the allocation to $5 million to fully realize its economic and artistic potential.  
 
Kimberly Motes, Executive Director of Chicago Shakespeare Theater, shared, “Increased resources for theater are necessary and hugely welcomed. We appreciate the establishment of the Non-Profit Theatre Tax Credit program—modeled on the uncapped film tax credit program—which recognizes the significant impact theater plays in the economic vitality of the state of Illinois. Theaters contribute significantly to the economy, employment, and healthy communities 365 days a year. With increased investment, we can continue to make Illinois an attractive state to live, work, and play.” 
 
Christopher Riley Managing Director of Music Theatre Works, comments, “We are grateful to the state of Illinois for the tax credit program. This invaluable new initiative, at one time limited to film and television, is now available to theaters as well. Through the League, we learned how this credit supports not only Music Theater Works, but also builds relationships and uplifts local, Illinois based business and all the communities that we serve. We look forward to the continued success of this program and its benefitting additional programming!” 
 
Managing Director of Theo Carolyn Brady adds, "In the current climate of uncertainty, especially in smaller and more intimate storefront houses, many theatres are closing their doors or minimizing their seasons in order to stay afloat. While the future of federal funding is unknown, I can say with certainty that there IS support at the city and state level. We at Theo are incredibly blessed and fortunate to receive generous Illinois grants and especially Illinois tax breaks that allow us to have some breathing room in our general operations and even show-specific budgetary needs. We have survived and flourished as a small theatre company known for its intimate storytelling and inclusivity and it will be with the support of our state, city and patrons that we will continue for another 28 years to come." 
 

About the Illinois Non-Profit Theatre Tax Credit:  

A 2024 amendment to the Live Theater Tax Credit, which was previously only accessible to large, for-profit productions, made $2 million in credits available to cover up to 20% of qualified expenditures for nonprofit theater groups across Illinois, providing an opportunity for the approximately 300 theater groups in Illinois to recoup a portion of their production costs as they continue to recover from sector-wide pandemic impacts.