Illinois State Tax Calculator

Facts & Figures serves as a one-stop state tax data resource that compares all 50 states on over 40 measures of tax rates, collections, burdens, and more. Start one or more free state income tax calculators and get an estimate of your state taxes. This free tax calculator will provide you with your esimtated tax return results. Late filing incurs a penalty of 2% of the unpaid tax if the return is filed within 30 days after the deadline, increasing to 10% thereafter. If a taxpayer fails to pay the full amount due, an additional late payment penalty of 1% per month applies until the balance is settled.

Interest on Amended Returns: Tips for Taxpayers

However, tax policy is always a topic of discussion in the state legislature. Some lawmakers and advocacy groups have called for a move to a progressive tax system, which would introduce tax brackets and higher rates for higher earners. Illinois does not tax Social Security benefits or most retirement income sources, such as public and private pensions, IRAs, 401(k) plans, and other types of retirement accounts. This makes Illinois tax-friendly for retirees compared to some other states. However, there is a state income tax in Illinois, and it is important to note that income illinois income tax percentage from sources other than retirement (such as wages, business income, etc.) is subject to taxation.

Retirement Income Tax: A Comprehensive Guide

Previously, the tax rate was raised from 3% to 5% in early 2011 as part of a statewide plan to reduce deficits. If you expect to owe $500 or more on April 15th, you must pay your income tax to Illinois quarterly using Form IL-1040-ES. Certain nonresidents who earned income in the state, as well as Illinois residents whose employers were located in another state, also may have to file taxes in Illinois. Food, drugs and medical appliances are all subject to a statewide tax rate of 1% of purchase price, in addition to local taxes of up to 1.25%, for a total tax of up to 2.25%. For example, candy and soda are generally subject to the higher “general merchandise” rate of 6.25%, but any candy containing flour is not, for sales tax bookkeeping purposes, classified as candy.

• Strategies to Reduce Estate Taxes for High-Net-Worth Individuals For high-net-worth individuals, estate taxes can significantly…
• Some lawmakers and advocacy groups have called for a move to a progressive tax system, which would introduce tax brackets and higher rates for higher earners.
• The income tax rate in Illinois is 4.95%, after an increase from 3.75% in 2017.
• For details on specific deductions available in Illinois, see the list of Illinois income tax deductions.
• If you’re considering life in Illinois, it’s essential to understand all the costs involved.
• These taxes fund local services such as schools, roads, and emergency services.
• Some people get monthly paychecks (12 per year), while some are paid twice a month on set dates (24 paychecks per year) and others are paid bi-weekly (26 paychecks per year).

Illinois Payroll Tax Rates

Additionally, contributions to Illinois’ 529 college savings plans, like Bright Start, are deductible, encouraging educational savings. These reduce a taxpayer’s total tax bill by some amount, which is in contrast to tax deductions, which only reduce a taxpayer’s taxable income. If you paid $1,000 in property taxes in 2024, you could claim a credit of $50 on your income tax return, which equates to $50 less that you end up paying in taxes. This means that capital gains are included when calculating an individual’s total taxable income, and are subject to Illinois’ standard income tax rates, which range from 4.95% to 7.99% as of 2021. Taxpayers in Illinois must report their capital gains and losses on their state income tax return, along with any other sources of income.

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• While some neighboring states have recently changed their tax systems—such as Indiana lowering its flat rate to 3% and Iowa moving to a flat rate of 3.8%—Illinois has chosen to keep its approach steady.
• Navigating the complexities of tax compliance is a fundamental aspect of running a business.
• The telecommunications tax is a tax on services including home phone lines, cell phones, television service and internet.
• This credit is particularly useful for families with multiple school-aged dependents.
• In Illinois, there’s a 7.25 percent sales tax rate on all vehicle purchases, with county and district local sales taxes on top of this usually ranging from 0.25 percent to 1.25 percent.
• If you are self-employed or own a business in Illinois, additional tax considerations apply.
• However, making pre-tax contributions will also decrease the amount of your pay that is subject to income tax.