Illinois charges a flat 4.95% state income tax, so every worker pays the same rate no matter what they earn, there are no brackets to climb.
The flat rate is simple, but Illinois pairs it with only a small personal exemption and some of the highest property taxes in the nation. Here is how the 4.95% really lands on your paycheck. See your exact take-home with the free Illinois paycheck calculator.
How Illinois's income tax works
Illinois applies a single 4.95% rate to your income after a personal exemption of about $2,775 per person. There is no graduated bracket system and no separate local income tax, so your state tax is easy to predict at any salary.
Illinois follows the federal treatment of 401(k) and HSA contributions, so pre-tax savings lower your Illinois taxable wages just as they lower your federal ones. It also fully exempts retirement income, which we cover below.
Your take-home on a $65,000 salary in Illinois
Here is how a $65,000 salary breaks down for a single filer, using 2025 federal and FICA figures alongside Illinois's a flat 4.95% income tax.
| Item | Annual |
|---|---|
| Federal income tax | $5,246 |
| FICA (Social Security + Medicare) | $4,973 |
| Illinois income tax | $3,080 |
| Take-home pay | $51,702 |
| Percent of gross kept | 79.5% |
On a $65,000 salary a single filer owes about $3,080 in Illinois income tax and keeps roughly $51,702, or 79.5% of gross. That flat 4.95% actually costs an Illinois worker more than residents of many bracketed states at the same income, because there are no low starter brackets to ease into. Compare with Indiana.
The flat rate, high property taxes, and the rejected graduated tax
Illinois voters rejected a 2020 ballot measure to replace the flat tax with graduated brackets, so the single 4.95% rate stays constitutionally locked in. The bigger bite for many households is property tax: Illinois has among the highest effective rates in the country (often around 2% of home value), especially in the Chicago suburbs.
Illinois does not tax Social Security or most retirement income (401(k), IRA, and pension withdrawals), which softens the picture considerably for retirees even though workers pay the full flat rate.
How to keep more of your Illinois paycheck
Because the rate is a flat 4.95% with little to deduct, the cleanest way to cut your Illinois tax is to lower your taxable wages: max a traditional 401(k) and HSA. Both reduce your Illinois and federal taxable income, and the HSA also escapes FICA.