Illinois State Income Tax Filing
Flat 4.95%
Rate
Flat 4.95% on net income, all filers
Standard deduction
None — a personal exemption applies instead
Personal exemption
$2,925 single / $5,850 joint, plus $2,925 per dependent
Retirement income
Qualifying retirement distributions are excluded from Illinois income
Illinois income tax at a glance
Illinois taxes income at a single flat rate of 4.95%, which makes it one of the more predictable state returns to prepare: there is no bracket to land in and no marginal-rate calculation to run. The Illinois constitution requires a flat rate, so this is structural rather than a policy setting that shifts each session. Two features matter more than the rate itself. There is no standard deduction — Illinois uses a personal exemption instead, which is much smaller — so a larger share of your income is exposed than a federal comparison suggests. And Illinois excludes qualifying retirement income entirely, including distributions from 401(k) plans, IRAs and most pensions, which is genuinely unusual and makes the state considerably more favourable for retirees than the flat rate alone implies.
Illinois tax rates
| Rate | Taxable income |
|---|---|
| 4.95% | All taxable income |
Illinois: Flat 4.95%.
- Personal exemption
- $2,925 single, $5,850 joint, $2,925 per dependent
Rates and thresholds as of . State legislatures change these mid-year and several states index brackets annually — check against Illinois Department of Revenue before relying on a figure.
What to watch out for in Illinois
- The flat rate is required by the Illinois constitution. A 2020 ballot measure to permit graduated rates was rejected, so a move to brackets would need a constitutional amendment rather than ordinary legislation.
- The retirement income exclusion covers qualifying distributions from 401(k) and similar plans, IRAs and most pensions. It is subtracted on the Illinois return rather than applied automatically, so it has to be claimed.
- Illinois has reciprocity agreements with Iowa, Kentucky, Michigan and Wisconsin. Residents of those states working in Illinois generally pay tax only at home on those wages, and vice versa.
- Illinois grants a credit for income tax paid to other states, which matters for anyone working across the Chicago metropolitan area into Indiana or Wisconsin.
Forms and deadlines
- Which form
- Form IL-1040, with Schedule NR for non-residents and part-year residents
- Deadline
- Aligns with the federal deadline.
- State authority
- Illinois Department of Revenue
Federal deadlines are separate from state ones. Our US tax deadlines page covers the federal calendar, and the federal tax brackets apply on top of whatever Illinois charges.
Where these figures come from
Rates, bracket floors, standard deductions and exemptions are taken from the compilation below, stated as of January 1, 2026 and built from state statutes, forms and instructions. The state authority is always the final word on your own position.
Reviewed by Teja K, CPA · last reviewed . General information, not tax advice for your situation. State tax law changes frequently — confirm before acting.
Illinois tax questions
What is the Illinois income tax rate?
A flat 4.95% on net income, applying to every filing status and every income level. There are no brackets, so there is no marginal rate to work out. Figures are as of January 1, 2026.
Does Illinois tax retirement income?
Generally not. Illinois excludes qualifying retirement income — distributions from 401(k) and similar plans, IRAs, and most pensions including Social Security — from state taxable income. This is unusual among states with an income tax and is a substantial benefit for retirees. It is claimed as a subtraction on the return rather than applied for you.
Does Illinois have a standard deduction?
No. Illinois grants a personal exemption instead — $2,925 for a single filer, $5,850 filing jointly, and $2,925 for each dependent. It is far smaller than the federal standard deduction, which means a much larger share of your income is subject to the 4.95% rate than a federal comparison would suggest.
I live in Indiana and work in Illinois. Where do I pay?
Indiana is not one of Illinois's reciprocity states, so wages earned for work performed in Illinois are taxable to Illinois on a non-resident return, and Indiana taxes you as a resident while granting a credit for the Illinois tax. Illinois does have reciprocity with Iowa, Kentucky, Michigan and Wisconsin, where the treatment is different — residents of those four generally pay only at home.
Which Illinois return do I file if I moved during the year?
Form IL-1040 with Schedule NR, which is used by both part-year residents and non-residents to allocate income between Illinois and elsewhere. You report income received while an Illinois resident plus any Illinois-source income from the remainder of the year.
We file Illinois returns alongside your federal
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