Withholding Income Tax

The Tax tables below include the tax rates, thresholds and allowances included in the Illinois Tax Calculator 2024. The Tax tables below include the tax rates, thresholds and allowances included in the Illinois Tax Calculator 2025. Some accounts, like a 401(k), FSA or HSA, allow you to make pre-tax contributions. So while making those contributions will decrease your take-home pay, stashing cash in one of these tax-advantaged accounts means the money will grow tax-free. In the case of the FSA and HSA, your money is there for you to spend on medical expenses.

What are the changes to the 2024 Illinois Business Income Tax returns and schedules?

When filing an income tax return in Illinois, taxpayers begin with their federal taxable income. From there, certain items may be added back in, and others may be subtracted. Among the most important items that are taxable federally but not in Illinois are retirement and Social Security income, as well as Law Firm Accounts Receivable Management distributions from a 529 college savings plan. Nevada, Ohio, Texas, and Washington impose gross receipts taxes instead of corporate income taxes.

• The state of Illinois has a flat income tax, which means that everyone, regardless of income, is taxed at the same rate.
• You can’t claim the same allowances with more than one employer in a single tax year.
• No Illinois cities charge a local income tax on top of the state income tax, though.
• Among states that impose a corporate income tax, the average top rate is 6.5 percent with a median rate of 6.5 percent.
• Most tax preparers can electronically file your return for you, or you can do it yourself using free or paid income tax software, like the examples listed below.
• The Federal Income Tax, in contrast to the Illinois income tax, has multiple tax brackets with varied bracket width for single or joint filers.
• If you receive a federal extension of more than six months, you are automatically allowed that extension for Illinois.

New Calculators

Illinois is one of 23 states to have or be in the process of implementing a flat income tax and one of only four where the tax structure is protected in the state constitution. The federal tax filing deadline for most individuals is typically April 15th of each year. The standard deduction, which Illinois does not have, is a deduction that is available by default to all taxpayers who do not instead choose to file an itemized deduction. Qualifying deductions might include an itemized deduction, the Illinois standard deduction, exemptions for dependants, business expenses, etc. The total exemption amount is deducted from base income to arrive at “net income.” The tax rate is then applied against net income. The base income earned in Illinois or while a resident of Illinois is then reduced by the number of federally claimed exemptions and any additional exemptions.

Illinois State Income Tax

You will likely need to make estimated QuickBooks payments if your income is either fully or partially exempt from Illinois withholding. This calculator uses the current federal tax brackets and Illinois state tax rate to estimate your taxes. It considers standard deductions based on filing status and applies an approximate deduction for each dependent.

Reminders for Illinois Individual Income Tax filing

Every state that implements a progressive income tax also taxes retirement income, which is currently exempt from taxation in Illinois. While the exact tax rates that may be enacted are to be determined, other bills currently active and previously proposed in the General Assembly have included specific income tax rates. Technically, you don’t have just one “tax bracket” – you pay all of the Illinois marginal tax rates from the lowest tax bracket to the tax bracket in which you earned your last dollar. For comparison purposes, however, your Illinois tax bracket is the tax bracket in which your last earned dollar in any given tax period falls. You can save time and money by electronically filing your Illinois income tax directly with the .

This reduces the taxable income for the year, potentially leading to lower tax liabilities. Additionally, the funds in these retirement accounts grow tax-deferred, meaning that taxes on investment gains are not paid until the money is withdrawn during retirement, ideally at a lower tax rate. The state of Illinois has a flat income tax, which means that everyone, regardless of income, is taxed at the same rate. That makes it relatively easy to predict the income tax you will have to pay.

Illinois Sales Tax

The following tax tables are supported by iCalculator™ US as part of the suite of free tax tools available in the US Tax HUB we provide for Illinois. The Illinois K-12 education expense credit can knock up to $750 off of your tax bill if you spent more than $250 on qualified education expenses. We believe everyone should be able to make financial decisions with confidence. Please consult with a qualified tax professional for specific advice about your tax situation. With the latest version of the proposed amendment currently sitting in the Senate Assignments Committee, McLaughlin said virtually every taxpayer in the state has reason for concern. Introduced by state Sen. Robert Martwick, D-Chicago, Senate Joint Resolution Constitutional Amendment illinois income tax rate 4 would formally replace language in the Illinois Constitution to allow for a so-called graduated tax system.

Bill introduced to again try for progressive income tax in Illinois

• Understanding the latest EITC rates and thresholds is crucial for taxpayers who wish to maximize their potential credit and accurately plan their finances.
• Louisiana’s corporate income tax rate was cut to 5.5 percent as of January 1, 2025, via House Bill 2, adopted in special session in late 2024.
• Unlike the Federal Income Tax, Illinois’ state income tax does not provide couples filing jointly with expanded income tax brackets.
• As simple as Illinois tries to make income tax, the state seems to take the opposite approach with sales taxes.

So if you live in Illinois and work in Iowa, Kentucky, Michigan or Wisconsin, you’ll pay tax to your home state. Many, or all, of the products featured on this page are from our advertising partners who compensate us when you take certain actions on our website or click to take an action on their website. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services.