Illinois Income Tax Calculator - SmartAsset (2024)

Taxes in Illinois

Illinois State Tax Quick Facts

• Income tax: 4.95% flat rate
• Sales tax: 6.25% - 11.50%
• Property tax: 2.23% effective rate
• Gas tax: 39.2 cents per gallon of regular gasoline, 46.7 cents per gallon of diesel

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. The income tax rate in Illinois is 4.95%, after an increase from 3.75% in 2017. Illinois also has higher-than-average sales taxes and property taxes.

A financial advisor can help you understand how taxes fit into your overall financial goals. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Illinois Income Taxes

The income tax system in Illinois emphasizes simplicity. The state’s flat rate of 4.95% means that you don’t need any tables to figure out what rate you will be paying. Also, the system’s heavy reliance on the federal tax code means you won’t need to learn a new set of rules for filing your state return. On the other hand, the flat rate does have drawbacks: Low earners can expect to pay more in Illinois than in many other states that have a progressive income tax.

When filing an income tax return in Illinois, taxpayers begin with their federal adjusted gross income (AGI, or taxable income, is income minus certain deductions). 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 distributions from a 529 college savings plan.

Illinois Tax Credits

There are several important tax credits in Illinois. 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. For example, the Illinois Property Tax Credit is equal to 5% of Illinois property tax paid on a principal residence for single filers with an AGI of $250,000 or less and joint filers with AGI of $500,000 or less. If you paid $1,000 in property taxes in 2023, you could claim a credit of $50 on your income tax return, which equates to $50 less that you end up paying in taxes.

The Earned Income Tax Credit is currently 20% of the federal credit by the same name. For tax year 2023, the maximum state credit a person can claim is $1,486. The Education Expense Credit provides a credit to parents who spent over $250 on eligible K-12 education expenses.

Illinois Sales Tax

As simple as Illinois tries to make income tax, the state seems to take the opposite approach with sales taxes. There are three rate structures depending on what you are buying. The three categories are qualifying food and drugs, vehicles and general merchandise.

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%. There are some food items that don’t count as a qualifying food. For example, candy and soda are generally subject to the higher “general merchandise” rate, but any candy containing flour is not, for sales tax purposes, classified as candy.

Vehicles also have their own tax rate. In general, the rate ranges from 6.25% to over 8.50%, depending on where the vehicle is purchased. Owner-to-owner sales, however, are subject to a lower rate, which depends on the price of the vehicle and, in some situations, the model year.

The general merchandise sales tax applies to almost all other products purchased for use in Illinois. The base rate is 6.25%. However most areas have additional local taxes between 0% and 5.25%. Cook, Kane and Warren counties are home to the state's highest combined sales tax rates of 11.50%, 11% and 11%, respectively.

Below is a table of the general merchandise sales tax rates for all of the counties in Illinois.

Illinois Property Tax

The 2.23% effective property tax rate in Illinois is second-highest in the nation, behind only New Jersey. That means the typical homeowner in the Prairie State pays 2.23% of their home value in property taxes.

Property taxes are collected by multiple local authorities: city governments, county governments, municipal transportation districts and even a collection of taxing authorities called “mosquito abatement districts,” which, as you might have guessed, kill mosquitoes. In total, there are almost 8,500 different authorities with the power to levy taxes in Illinois, more than in any other state.

Our Illinois mortgage rates guide has important information about mortgages in the Prairie State that will help make the process of getting a mortgage a bit easier – whether you’re looking to purchase a property or refinance.

Illinois Estate Tax

Illinois is one of 13 states with an estate tax. For tax year 2023, estates worth less than $4 million are exempt. Estates over that amount must file an Illinois estate tax return and face tax rates up to 16%. But not all estates that file a return will pay taxes. Certain tax deductions may reduce the taxable estate below the taxable limit, and property or assets left to the husband, wife or civil union partner or the decedent are not taxable.

Illinois Telecommunications Tax

The telecommunications tax is a tax on services including home phone lines, cell phones, television service and internet. It varies by location, but is generally about 7% of the price of service.

Illinois Gasoline Tax

The state of Illinois collects 39.2 cents for every gallon of regular gasoline. That is one of the highest in the nation. The diesel tax rate is also quite high at 46.7 cents per gallon.

Illinois Alcohol and Tobacco Tax

Illinois applies per-gallon alcohol excise taxes based on the alcohol content of the beverage being sold. Beer will generally be subject to a rate of 23.1 cents per gallon while wine and liquor are subject rates of $1.39 and $8.55 per gallon, respectively. The cigarette excise tax in Illinois is $2.98 per pack of 20.

• Illinois is the home state of former U.S. president, Barack Obama.
• Former U.S. president Abraham Lincoln owned and operated a bar in New Salem, Illinois, before entering politics.
• “Illinois” is the French adaptation of an Algonquin word that means warriors.