Illinois Income Tax Rate
4.95% flat rate
Everyone pays 4.95% of taxable income, regardless of income level or filing status.
Key Facts That Affect Your Take-Home Pay
- Illinois uses a flat 4.95% income tax rate for all income levels and filing statuses—unlike federal taxes or states with graduated brackets, your Illinois tax percentage stays the same whether you earn $30,000 or $300,000. This flat rate was increased from 3.75% in recent years, making it one of the higher flat tax rates in the nation.
- Illinois has no local income taxes at the city or county level for most residents (unlike Pennsylvania or Ohio where many cities levy local taxes), so your paycheck shows only state and federal tax deductions—no surprise local income tax line items based on your work address. Chicago does not levy a separate income tax, unlike many other major cities.
- Illinois's flat tax rate means everyone pays the same 4.95% rate regardless of income level, creating a simple but potentially regressive system where lower earners pay a larger percentage of their take-home pay toward state tax than higher earners. The rate is higher than Pennsylvania's 3.07% but lower than most progressive states' top brackets.
Common Mistakes People Make
Misconception: 'Flat tax means low tax.' Illinois's 4.95% flat rate isn't necessarily low—it's simple, but not necessarily cheap. For someone earning $80,000, that 4.95% is $3,960, which could be more than they'd pay in a progressive state with generous lower brackets. The 'flat tax' label sounds appealing, but it doesn't automatically mean you'll pay less than in states with graduated brackets—especially for middle-income earners who might benefit from progressive brackets elsewhere.
Misconception: 'No local taxes means Illinois is cheaper than other states.' While Illinois doesn't have widespread local income taxes like Pennsylvania or Ohio, the state's high property taxes and sales taxes can significantly offset this advantage. Property taxes in Illinois, especially in Chicago and surrounding suburbs, are among the highest in the nation and can range from $6,000-$12,000+ annually for a typical home Combined with the flat 4.95% income tax, your total tax burden may not be as low as expected.
Misconception: 'Everyone pays the same percentage, so it's fair.' While everyone pays the same 4.95% rate in Illinois, the economic impact is different. 4.95% of a $35,000 salary ($1,733) represents a larger share of disposable income than 4.95% of $150,000 ($7,425). Flat taxes are proportionally equal, but not necessarily equitable in terms of real-world impact on people's financial lives—lower earners pay a larger percentage of their ability to cover necessities, while high earners benefit from not being pushed into higher brackets.
One Thing to Know
Illinois property taxes are among the highest in the nation (especially in Chicago and suburbs), but they're not on your paycheck—they come through mortgage escrow or direct bills. Many people focus on the 4.95% income tax rate and are shocked when they see $8,000-$12,000+ annual property tax bills on a typical home.
Important Notes
These calculations are estimates based on current tax law. Your actual take-home pay varies based on:
- Pre-tax deductions (401(k), health insurance, HSA, etc.)
- Your W-4 withholding elections
- Additional income or deductions at tax time
- Individual circumstances and tax situations
Tax rates are subject to change. Federal and state tax laws may be updated annually. This is not tax advice. For personalized help, consult a tax professional familiar with Illinois tax laws.