Illinois Retirement Income Tax Calculator
Illinois subtracts Social Security, qualified pensions, IRAs and 401(k) payouts, then taxes other income at 4.95%.
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Illinois resident retirement worksheet
Illinois · 2026 estimate
Estimate ready
- Approved retirement amounts outside Illinois tax
- $65,000.00
- Illinois taxable income
- $0.00
- After Illinois tax
- $65,000.00
- Effective rate on total income
- 0.00%
Calculation scope2026 prepared net-income estimate; before credits
Illustrative defaults. Enter approved taxable amounts and confirm eligibility. The result covers the displayed worksheet conditions; a complete return may require other income, adjustments, deductions or credits.
Current-year rates and primary-source eligibility reviewed October 1, 2026. Use the federal tool separately; these inputs do not prepare a complete federal or state return.
Reviewed October 2, 2026. Confirm the Illinois subtraction before treating a plan as exempt
What Illinois taxes in retirement
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Social Security
Not taxedSubtracted in full, with railroad retirement.
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Pensions
Not taxedQualified-plan and government pensions are subtracted (Publication 120).
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IRA & 401(k) withdrawals
Not taxedIRA and 401(k) distributions are subtracted.
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Wages from work
TaxedFlat 4.95% of net income.
Partly taxed: limits by age, plan, owner or income apply. Military retirement is covered in the guide. How these labels work.
Confirm the Illinois subtraction before treating a plan as exempt
Illinois subtracts qualifying federally taxed retirement amounts. Nonqualified payments require a different calculation.
Illinois Publication 120 lists retirement income eligible for a subtraction, including qualifying pension or plan distributions, IRAs and Social Security amounts included federally. It also identifies payments that do not qualify. The relevant amount is the federally taxed portion approved for subtraction; a gross distribution containing contribution basis should not be used as a federal taxable amount.
Plan type matters more than the recipient’s age alone. The guidance permits certain qualifying early distributions and Roth conversions, while nonqualified deferred compensation or other excluded arrangements cannot inherit the subtraction simply because the payer calls the receipt a pension. Trust or estate retirement distributions can also require the appropriate schedule rather than the ordinary pension line.
The Illinois tool requires confirmation of qualifying plan amounts. It applies 4.95% only to other prepared net taxable income, after approved Illinois exemptions and deductions. For example, $10,000 of already prepared remaining net income produces $495 before credits. That example does not say that a person receiving $10,000 of gross wages or interest has a $495 final return liability.
Keep the pension statements and Illinois classification record separate from the federal benefit worksheet. State-exempt retirement can still increase federal provisional income or ordinary taxable income. A qualified-plan household with no remaining Illinois net taxable income may have zero state tax while owing federal tax; any uncertain plan classification leaves the state estimate unresolved instead of approving an automatic exemption.
Prepare these Illinois records
- Publication 120 qualified versus nonqualified income
- Federally taxed amount after contribution basis
- Other Illinois NET base after exemptions / deductions
Official Illinois source. Current statute / agency guidance; annual forms must match the tax year.
Calculate the federal portion separately
Use the federal retirement-tax worksheet to prepare federally included benefits and ordinary income. Its federal deduction and rates do not replace the Illinois rules above.
Compare Illinois with nearby states
Wisconsin, Iowa, Missouri, Kentucky and Indiana border Illinois. Run each one’s worksheet with the same household figures before deciding where a move would leave you.
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Updated / verified · Retirement Income Tax Calculator Editorial Team