Illinois Paycheck Calculator Calculate Your Take-Home Pay After Taxes

This means that regardless of how much you earn, the tax rate remains the same. For Illinois residents, the flat rate for income tax is 4.95% as of 2025. Illinois’s state income tax rate of 4.95% flat rate affects your take-home pay along with federal taxes. Everyday transactions are impacted by sales tax; both cities have among of the highest rates nationwide.

Illinois Estate Tax

The exemption for tax year 2024 is a maximum of $5,550 for married online bookkeeping couples filing jointly ($2,775 for single filers). 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. Veritas is a platform for independent tax credit consultant and tax advisors to better help their clients.

• These taxes comprise a combination of sales tax, excise taxes paid at the pump and wholesaler/retailer taxes.
• Particularly with regard to housing and daily expenses, New York City has a greater cost of living than Chicago.
• 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.
• Chicago imposes a combined sales tax rate of 10.25%, which includes a state sales tax of 6.25% and a city sales tax of 4%.
• Chicago’s property tax rate is roughly 2.2% of the value of your property; however, the final amount may vary depending on some variables, including any exemptions or deductions for which you qualify.

How Chicago, Illinois Residents Are Taxed on Ordinary Income

For comparison purposes, however, your Illinois tax bracket is the tax bracket in which your last earned dollar in any given tax period falls. The Chicago Department of Finance and Cook County Department of Revenue are active and aggressive in auditing local taxes. The initial information request can be quite voluminous – taxpayers should be cautious in responding without counsel to avoid opening a can of worms. In Cook County the deadline to appeal a Notice of Determination is Bookkeeping vs. Accounting 35 days from the date of receipt of the notice. This is a huge improvement from the 20-day rule that was amended last year, but it is still a quick and unforgiving turnaround.

Use Tax for Non-Titled Personal Property – (8402B, 8402CO, 8402IN)

• Keep in mind that this estimator assumes all income is from wages, assumes the standard deduction, and does not account for tax credits.
• On top of those charges, Pennsylvania charges a flat 3% tax rate on individual 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.
• Everyone around me was doing it, and the paperwork made it seem almost routine.

The study uses tax rates in effect in 2016, before Illinois raised its flat income tax from 3.75 percent to 4.95 percent. Auxier, however, said that increase wouldn’t be likely to have a major effect on Chicago’s rank. And while the report accounts for state and local income taxes, illinois state income tax rate property taxes, sales taxes and auto taxes, it doesn’t cover the myriad fees Lightfoot referenced. 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.

• It is important to note that this is only an estimate, and your actual tax liability may vary.
• The state of Illinois has a flat income tax, which means that everyone, regardless of income, is taxed at the same rate.
• The calculator automatically applies current Illinois and Chicago tax rates.
• Before joining Illinois Answers, he worked as a reporter and editor for The Daily Line covering Cook County and Chicago government.
• This tool is freely available and is designed to help you accurately estimate your 2026 tax return.

Pittsburgh, for example, collects a 3% tax on everyone who works in the city, with most of the money going to the local school district. The city collected about $111 million from income taxes in 2021, compared to about $152 million from property taxes. On top of those charges, Pennsylvania charges a flat 3% tax rate on individual income. When comparing Illinois to other states, it’s important to note that some states have progressive income tax systems, where tax rates increase as income rises. States like California and New York, for example, have several income tax brackets, with the highest rates reaching over 10%. In contrast, Illinois’ flat rate offers more predictability and simplicity in terms of tax planning.

Logistics Calculators

• Instead, she made a blanket statement that plays straight into a common but misleading narrative that all in Chicago pay punishingly high taxes.
• Veritas specializes in matching tax payers with the appropriate tax credits to reduce their tax liability.
• Paycheck Calculator provides accurate salary calculations and tax insights to help you make informed financial decisions.
• If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• So if you live in Illinois and work in Iowa, Kentucky, Michigan or Wisconsin, you’ll pay tax to your home state.
• The city collected about $111 million from income taxes in 2021, compared to about $152 million from property taxes.

Chicago tax calculators are generally accurate, but they are not a substitute for professional tax advice. If you have any questions about your taxes, you should consult with a tax professional. Bhatti said a progressive Chicago income tax could skirt Illinois’ ban on progressive taxation by setting a uniform 3.5% rate but exempting the first $100,000 of each household’s income.