Illinois Income Tax Calculator 2026
See your Illinois state tax, effective rate, and take-home pay in 60 seconds.
Estimate only. Uses 2026 federal figures, Illinoisstate figures (see sources below), and a standard-deduction federal calculation. Filing status “Head of household” uses the single column for Illinois. Your actual tax depends on credits, additional income, and adjustments.
Worked example: A single filer earning $85,000 in Chicago
Start with $85,000 of wages. Subtract the $2,850 personal exemption allowance to get roughly $82,150 of Illinois taxable income. At the flat 4.95% rate, that's about $4,066 in Illinois income tax — an effective state rate near 4.8%. Because Chicago levies no local income tax, there's nothing further to add at the city level. Federal income tax and FICA are calculated separately and shown in the calculator above.
Assumes a single filer taking the standard treatment. Figures are educational estimates.
How Illinois taxes income
Illinois is a flat-tax state: every dollar of taxable income is taxed at the same 4.95% rate, no matter how much you earn. There are no income brackets to climb.
Illinois starts from your federal adjusted gross income (AGI), applies a handful of state-specific additions and subtractions, then subtracts a per-person personal exemption allowance ($2,850 in 2025) before applying the 4.95% rate. Illinois has no standard deduction in the federal sense — the exemption allowance plays that role.
2026 rate structure
Retirement income & Social Security
Illinois fully exempts most retirement income. Qualified distributions from 401(k)s, 403(b)s, IRAs, and government and private pensions are subtracted on Schedule M and are not taxed. This makes Illinois one of the more retiree-friendly states for income, despite high property taxes.
Local taxes & reciprocity
Illinois has no local or municipal income tax. Unlike Ohio, Pennsylvania, or New York City, no Illinois city — including Chicago — levies a separate wage or earnings tax on residents.
Reciprocity: Illinois has reciprocity agreements with Iowa, Kentucky, Michigan, Wisconsin. If you live in Illinois and work in one of those states, you pay Illinois tax on those wages and file only in Illinois.
Notable deductions, credits & other taxes
Deductions & credits
- Personal exemption allowance ($2,850/person, 2025) — phases out above $250,000 (single) / $500,000 (MFJ) federal AGI
- Illinois Earned Income Credit — 20% of the federal EITC
- K-12 Education Expense Credit — up to $750 for qualifying tuition, book, and lab fees
- Property Tax Credit — 5% of Illinois property tax paid on a principal residence (income-limited)
Capital gains: Illinois does not have a separate capital gains rate. Capital gains that are included in your federal AGI are taxed as ordinary income at the flat 4.95% rate.
Property tax: Illinois property taxes are among the highest in the country, with an average effective rate near 2.07% of home value. A 5% Illinois Property Tax Credit partially offsets this for principal residences.
Illinois vs. neighboring states
Illinois's flat 4.95% sits in the middle of its neighbors. Indiana (3.0% in 2026, plus county taxes) and Missouri (graduated, topping out near 4.7%) are lower for many earners, while Wisconsin's graduated rates climb to 7.65% and Iowa has moved to a flat 3.8%. Kentucky's flat 4.0% is also lower. Illinois's bigger story is property tax, which is far above all of these states.
Illinois state tax FAQs
What is the Illinois state income tax rate for 2026?
Illinois has a single flat individual income tax rate of 4.95%. It applies to all taxable income regardless of how much you earn — there are no graduated brackets. The rate is set in statute and is not adjusted for inflation, so it carries into 2026.
Does Illinois tax retirement income or Social Security?
No. Illinois fully exempts Social Security benefits and most retirement income, including distributions from 401(k)s, IRAs, and government and private pensions. Qualifying retirement income is subtracted on Schedule M, so it is not subject to the 4.95% rate.
Does Chicago have a city income tax?
No. Illinois has no local or municipal income tax, and Chicago is no exception. Unlike New York City or Philadelphia, no Illinois city levies a separate income or wage tax on residents' earnings.
How are capital gains taxed in Illinois?
Illinois has no special capital gains rate. Capital gains that are included in your federal adjusted gross income are taxed as ordinary income at the flat 4.95% rate.
Do I owe Illinois tax if I live in Illinois but work in another state?
Illinois has reciprocity agreements with Iowa, Kentucky, Michigan, and Wisconsin. If you live in Illinois and work in one of those states, you pay Illinois tax on those wages and file only in Illinois. For non-reciprocal states, you generally file a non-resident return there and claim a credit on your Illinois return to avoid double taxation.
Why are my Illinois property taxes so high if the income tax is low?
Illinois funds a large share of local services — especially schools — through property taxes rather than income tax. The average effective property tax rate is near 2.07% of home value, among the highest in the nation. A 5% Illinois Property Tax Credit offsets part of this for a principal residence.
Sources & verification
Last verified June 12, 2026.