Illinois tax guide
Illinois employs a straightforward flat tax system where a single rate of 4.95% applies to all residents. Because the state does not use tax brackets, your tax liability is directly proportional to your total income, making paycheck projections more predictable than in progressive tax states.
Key tax highlights
Payroll
- All earned income is subject to the mandatory 4.95% flat state income tax rate.
- Employers are required to withhold Illinois state income tax from employee paychecks based on this flat percentage.
- Illinois does not offer personal exemptions for tax year 2024, simplifying payroll calculation processes for employers.
Local taxes
- While Illinois has a flat state rate, certain local governments, such as those in Cook County, impose significant property taxes that influence your overall cost of living.
- Some home rule municipalities may impose local sales taxes that can impact your net disposable income beyond your paycheck withholdings.
Deductions
- Residents can claim a property tax credit equal to 5% of the Illinois property tax paid on their principal residence.
- Illinois allows a deduction for K-12 education expenses, providing tax relief for families with qualifying school-related costs.
Salary examples
Pre-computed take-home estimates at common salary levels. For example, a $75,000 salary in Illinois yields about $57,880 after all deductions (77.2% take-home rate). Use the calculator above with your actual salary to see your specific estimate.
| Salary | Federal | State | FICA | Take-Home | Rate |
|---|---|---|---|---|---|
| $50,000 | $3,820 | $2,475 | $3,825 | $39,880 | 79.8% |
| $75,000 | $7,670 | $3,713 | $5,738 | $57,880 | 77.2% |
| $100,000 | $13,170 | $4,950 | $7,650 | $74,230 | 74.2% |
| $150,000 | $24,734 | $7,425 | $11,475 | $106,366 | 70.9% |
Neighboring states
How Illinois compares with border states on income tax. At a $75,000 salary, a Illinois worker pays $3,713 in state tax annually.
Tax tips for Illinois
- Review your paystub to ensure your employer is withholding the exact 4.95% flat rate for Illinois state taxes.
- Retain documentation of your annual property tax payments to ensure you capture the 5% property tax credit at filing time.
- Check if your employer offers pre-tax benefits like 401(k) contributions, as these reduce the federal adjusted gross income that serves as the base for your Illinois state tax calculation.
- Ensure you are accounting for the lack of state personal exemptions when estimating your end-of-year tax liability.
Did you know?
- •Illinois is one of the few states that maintains a constitutional flat tax requirement, preventing the legislature from implementing progressive income tax brackets without a constitutional amendment.
- •The Illinois property tax credit is one of the few remaining significant state-level tax expenditures for homeowners.
Filing guidance
Illinois taxpayers must file Form IL-1040 to report income and calculate their tax liability. Since the state flat tax is applied to your federal adjusted gross income, ensure your federal return is prepared accurately first, as discrepancies in federal reporting will trigger adjustments in your state tax filing. Electronic filing through the MyTax Illinois portal is the recommended method to ensure faster processing and to verify that all applicable credits, such as the K-12 education expense deduction, are applied correctly.
Relocation context
Comparing Illinois with nearby states can reveal whether paycheck differences are driven by state tax, local tax, or payroll deductions.