What is Illinois Income Tax? Rates & Tax Brackets

Updated for tax year 2025.

If you live or work in Illinois, you’ll likely need to file an Illinois state income tax return along with your federal return. Illinois has a flat income tax system with one rate (4.95%), so the same rate applies regardless of your filing status or income level.

This guide explains Illinois’s 2025 income tax rate, how the flat tax works, available exemptions and credits, and updates for the current tax year. When you’re ready to file, TaxAct® automatically applies Illinois’s tax rules to help you accurately prepare your Illinois return alongside your federal return.

What is the Illinois state income tax?

Illinois state income tax is a tax on income earned by individuals. It is collected by the Illinois Department of Revenue and helps fund state services.

Unlike states with progressive tax brackets, Illinois uses a flat income tax. For tax year 2025, Illinois taxes individual net income at a single rate of 4.95%, regardless of how much you earn or your filing status. The flat rate has been in place since 2017.

Illinois income tax rates and tax brackets

Illinois has a flat-rate income tax of 4.95%. Since it is a flat rate, it applies to all taxpayers, regardless of income or filing status.

If you need more information on how federal tax brackets work, you can use our tax bracket calculator for federal taxes.

Illinois standard deduction

Illinois does not have a state standard deduction on Form IL-1040. Instead of a standard deduction, Illinois has a personal exemption allowance that reduces your Illinois base income. See the exemptions section below for 2025 amounts.

Illinois exemptions

Illinois uses a personal exemption allowance rather than a traditional dependent exemption schedule. For tax year 2025, the personal exemption amount is $2,850 per qualifying individual ($5,700 for married couples filing jointly when both spouses qualify).

Taxpayers who are age 65 or older or legally blind may qualify for an additional $1,000 exemption. High-income taxpayers may receive a reduced or zero exemption allowance based on Illinois income limits.

Illinois also offers credits that may reduce your tax, including the Illinois Earned Income Credit and Illinois Child Tax Credit.

Nonresident or part-year resident with Illinois earned income?

If you are a nonresident of Illinois but earned income in Illinois, you need to file Schedule NR of Form IL-1040. You must file Schedule NR if you were a part-year resident of Illinois. TaxAct® can help you fill out this form if you file your Illinois state income tax return with us.

Illinois tax changes for 2025

The personal exemption allowance increases to $2,850 (up from $2,775 for tax year 2024).
Illinois also updated several forms and credits for 2025, including an increase in the Illinois Child Tax Credit to 40% of the Illinois Earned Income Credit and a medical debt relief subtraction on Schedule M.
Flat income tax rate remains 4.95% for 2025.

Outside of these updates, Illinois’s core flat-rate structure remains in place for 2025.

FAQs

Does Illinois have a state income tax?

Yes, Illinois has a state income tax. Illinois uses a flat 4.95% income tax rate for tax year 2025, rather than a progressive bracket system.

What is the Illinois income tax rate?

Illinois’s individual income tax rate is 4.95% for tax year 2025. Because Illinois uses a flat tax, the same rate applies regardless of your income level or filing status.

What are the Illinois income tax brackets for 2025?

Illinois does not have income tax brackets. Since 2017, Illinois has taxed individual net income at a flat rate of 4.95% for all taxpayers.

How does Illinois state income tax work?

Illinois state income tax works by applying a flat 4.95% rate to your Illinois net income after allowable exemptions and subtractions. You start with your federal adjusted gross income (AGI), then make Illinois-specific additions and subtractions to determine your Illinois base income. Your exemption allowance and any credits you qualify for can reduce what you owe.

Do I have to file an Illinois state tax return?

You may need to file an Illinois state tax return if you are an Illinois resident, part-year resident, or nonresident with Illinois-source income and you meet Illinois filing requirements. Nonresidents who earned income in Illinois generally file Schedule NR with Form IL-1040. Check Illinois Department of Revenue guidance for your situation.

What is the Illinois standard deduction for 2025?

Illinois does not offer a standard deduction on its state income tax return. Instead, Illinois allows a personal exemption allowance of $2,850 per person for tax year 2025 ($5,700 for married couples filing jointly when both spouses qualify). High-income taxpayers may receive a reduced or zero exemption based on Illinois rules.

How much is Illinois state income tax?

There isn’t one Illinois state income tax amount that applies to everyone. How much you owe depends on your Illinois net income, exemption allowance, and any credits. As a starting point, Illinois taxes net income at a flat 4.95% rate before exemptions and credits are applied.

Why is my Illinois tax return different from my federal return?

Illinois generally uses your federal adjusted gross income as a starting point, but Illinois has its own additions, subtractions, exemptions, and credits that can make your Illinois tax different from your federal return.

The good news is that our tax software automatically applies Illinois’s current tax rules when preparing your state return, so you don’t have to calculate these differences yourself.

For more information, visit the Illinois Department of Revenue. If you’d like to learn more about recent federal tax law changes, see our OBBB tax changes guide.

The bottom line

Illinois has a flat state income tax rate of 4.95% for 2025. Understanding how Illinois calculates net income, exemption allowances, and available credits can help you estimate what you may owe — and what you may get back.

When you’re ready to file, TaxAct can help you prepare your federal and Illinois returns in one place so you can file with confidence.

Already filed your taxes and waiting for your refund? Learn more about where your Illinois state tax refund is.

This article is for informational purposes only and not legal or financial advice.

All TaxAct offers, products and services are subject to applicable terms and conditions.

The OBBB is now also being referred to by lawmakers as the Working Families Tax Cut Act. You may see one or both names used here, but they refer to the same set of tax changes.

Citations

Illinois Department of Revenue. “What’s New for 2025?” Accessed 21 July 2026.
Illinois Department of Revenue. “2025 IL-1040 Instructions.” Accessed 21 July 2026.
TaxAct. “Working Families Tax Cuts Act: 2025 Tax Reform Explained.” TaxAct Blog.
TaxAct. “Where’s My Illinois State Tax Refund?” TaxAct Blog, 16 Jan. 2026.