Illinois Income Tax: Rates, Who Pays in 2025

Learn about rates, calculations, credits, and filing requirements to ensure compliance. 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. Taxpayers 65 or older and those who are legally blind receive an extra exemption of $1,000 each.

• By understanding these rules and planning ahead, you can meet your tax obligations and avoid surprises, whether you are a long-time resident, a newcomer, or someone with pending immigration matters.
• Watch the video below to learn how to identify your 2024 federal income tax brackets.
• Illinois provides a standard Personal Exemption tax deduction of $ 2,625.00 in 2025 per qualifying filer and qualifying dependent(s), this is used to reduce the amount of income that is subject to tax in 2025.
• The EITC rates and thresholds are adjusted annually to reflect changes in the economy and cost of living.
• While most in-depth tax software charges a fee, there are several free options available through the states, and simple versions are also offered free of charge by most tax software companies.

IRS Announced Federal Tax Filing and Payment Deadline Extension

• Taxpayers 65 or older and those who are legally blind receive an extra exemption of $1,000 each.
• This reduces the taxable income for the year, potentially leading to lower tax liabilities.
• Illinois’ maximum marginal income tax rate is the 1st highest in the United States, ranking directly below Illinois’ %.
• The Education Expense Credit provides a credit to parents who spent over $250 on eligible K-12 education expenses.
• Beer will generally be subject to a rate of 23 cents per gallon while wine and liquor are subject rates of $1.39 and $8.55 per gallon, respectively.

You also may qualify for exemptions for each dependent, further lowering taxable income. Failure to meet Illinois income tax obligations results in penalties for late filing trial balance and payment. The late filing penalty is 2% of the tax due per month, up to 20%, while the late payment penalty starts at 2% for the first month, up to 15%. Interest on unpaid taxes accrues from the original due date, with a current rate of 3% per annum. Severe cases of intentional tax evasion may lead to criminal charges under Illinois law. Tax-Rates.org provides easy access to five of the most commonly used Illinois income tax forms, in downloadable PDF format.

• That makes it relatively easy to predict the income tax you will have to pay.
• Whether you’re a full-year resident, part-year resident, or nonresident, TurboTax is here to help simplify the process.
• That means the typical homeowner in the Prairie State pays 2.11% of their home value in property taxes.
• You also may qualify for exemptions for each dependent, further lowering taxable income.

Have Questions About Your Taxes?

A financial advisor can help you understand how taxes may impact your overall financial goals. SmartAsset’s free tool matches you with up to three vetted financial illinois income tax rate 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 paid more frequently, each of your paychecks will be smaller.

Filing Requirements and Deadlines

If you want to check the status of your Illinois tax refund, you can visit the Illinois Income Tax Refund page. The two most popular tax software packages are H&R Block At Home, sold by the H&R Block tax preparation company, and TurboTax Federal & State, sold by the Intuit software company. Both companies produce multiple editions for simple to very complex tax returns, so be sure to carefully compare the features offered by each package. Illinois does not have tax brackets, so calculating your rate should be pretty simple. If you have a dollar or $1 billion that’s subject to Illinois income tax, you owe 4.95% of that money to the state. If you have more than one job, you’ll need to split your allowances between your jobs.

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. Certain high-income taxpayers in Illinois are not eligible for the exemption allowance. This new version no longer asks you to list total allowances, as it instead uses a five-step process that lets you enter personal information, claim dependents and indicate any additional income or jobs. In the absence of allowances, filers are required to enter annual dollar amounts for things like income tax credits, non-wage income, itemized and other deductions and total annual taxable wages.

What is Illinois’ standard deduction?

A bigger paycheck may seem enticing, but smaller, more frequent paychecks can make it easier to budget without coming up short by the end of the month. There are also some items that are exempt from sales tax; a list of those items, including newspapers and magazines, can be found here. Illinois also has reciprocity with the neighboring states of Iowa, Kentucky, Michigan and Wisconsin, which means those states don’t tax Illinois residents who work within their Online Bookkeeping borders.

Our mission is to demystify the intricacies of immigration laws, visa procedures, and travel information, making them accessible and understandable for everyone. 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 federal standard deduction for a Head of Household Filer in 2025 is $ 22,500.00. The Illinois K-12 education expense credit can knock up to $750 off your tax bill if you spent more than $250 on qualified education expenses. Here are some key tax reduction programs in Illinois, and how to qualify.

You can’t claim the same allowances with more than one employer in a single tax year. An alternative is to divide your allowances between the two jobs on the Form IL-W-4 you give to each employer, or you could claim all your allowances with one job and none with the other. If you double-claim allowances while holding more than one job, you’ll owe more money at tax time. Whether you’re a full-year resident, part-year resident, or nonresident, TurboTax is here to help simplify the process. If your state tax witholdings are greater then the amount of income tax you owe the state of Illinois, you will receive an income tax refund check from the government to make up the difference.