Welcome to the top 20, Illinois. Top 20 for personal income tax rates, that is. Earlier this month, the state’s lawmakers raised its rate from 3.75% to 4.95%. The increase bumped Illinois’s ranking to number 16 in the nation. Previously, the state ranked 33 for personal income tax rates. Illinois is a flat tax rate state, similar to North Carolina, Massachusetts, and Utah. Despite raising its rate, Illinois’s 4.95% is less than the aforementioned states. Illinois’s corporate rate will jump to 7% from its previous 5.25%. Increasing the personal income tax rate will bring $4.3 billion a year in additional revenue for the state, with the increased corporate rate bringing in an additional $460 million a year. What does this mean for residents and their paychecks? A single person making $50,000 a year will pay roughly $287 more in taxes each paycheck in 2017. By 2018, it will increase to $574. A married couple earning a combined $100,000 will pay an extra $574 in taxes each paycheck in 2017, and an extra $1,148 in taxes in 2018. Live and work in Illinois and want to see the impact on a future paycheck? Use our salary calculator now.
These free resources should not be taken as tax or legal advice. Content provided is intended as general information. Tax regulations and laws change and the impact of laws can vary. Consult a tax advisor, CPA or lawyer for guidance on your specific situation.