Illinois Income Tax Brackets (2026)

Illinois levies a flat income tax of 4.95% on all taxable income. Unlike graduated-tax states where rates escalate with income, every dollar you earn in Illinois is taxed at the same 4.95% rate. This simplicity means your effective state tax rate is essentially the same whether you earn $50,000 or $500,000.

The practical advantage of a flat tax is predictability: if your income doubles, your state tax exactly doubles. In a graduated state like California (1\u201313.3%), a doubling of income could more than double your state tax as more of it falls into higher brackets.

Your total income tax is the sum of federal and Illinois state taxes. At each income level, an additional dollar is taxed at your federal marginal rate plus the state marginal rate. This combined marginal rate tells you how much of each additional dollar goes to taxes.

At $200K income, your combined marginal rate in Illinois is 28.9% — meaning each additional dollar is split roughly 29¢ to taxes and 71¢ to you. Even at $50K, the combined marginal rate is already 16.9%. This is why tax-advantaged strategies become increasingly valuable at higher incomes.

While you can’t change the bracket structure, several strategies can reduce the income that’s subject to Illinois’s 4.95% flat rate:

401(k) / 403(b) contributions: In 2026, you can contribute up to $23,500 pre-tax ($31,000 if age 50+). This reduces both federal and Illinois taxable income. At Illinois’s 4.95% rate, maxing your 401(k) saves roughly $1,163 in state taxes alone.

HSA contributions: If you have a high-deductible health plan, contribute up to $4,300 (individual) or $8,550 (family) to an HSA. These contributions are exempt from both federal and state income tax in Illinois.

Itemizing deductions: If your state and local taxes (SALT), mortgage interest, and charitable contributions exceed the standard deduction, itemizing can reduce your federal tax. The federal SALT cap of $10,000 limits how much of your Illinois state tax you can deduct federally.

Traditional IRA: If you’re not covered by an employer plan (or your income is below the phase-out), a traditional IRA contribution of up to $7,000 ($8,000 if 50+) reduces both federal and state taxable income.

How does Illinois’s flat 4.95% tax compare to nearby states? Here’s a side-by-side at $100K income:

Every state ranked by state income tax burden at $100K income. Illinois is highlighted at position #39.