"The Land of Lincoln,'' otherwise known as Illinois, is one of 42 states that imposes an income tax on residents. Illinois has the distinction of having a flat income tax rate. This means that everyone in Illinois pays the same percentage of income toward taxes, regardless of what they earn. The state has a tax website for filing your return and handling other transactions like tax payments.
Who Must File Illinois Income Taxes?
An Illinois resident must file an income tax return if they are required to file a federal tax return. According to the Illinois Department of Revenue, the exception to this is if you’re not required to file a federal income tax return but your base income is more than the Illinois exemption allowance.
There are other individuals that come under Illinois Department of Revenue requirements for filing. Illinois residents who work in the bordering states of Iowa, Kentucky, Michigan and Wisconsin must file an Illinois state return.
If your employer in one of these states withheld that state's taxes, you likely can file for a refund. But the refund must go directly to the Illinois Department of Revenue for your income tax liability.
If you are a part-time Illinois resident, you must file an Illinois tax return if you earned any income while living in Illinois.
You must file an Illinois income tax return if you are retired, but there can be exceptions depending on the circumstances. You do not have to file an Illinois tax return if your only sources of income are from a pension, Social Security, railroad retirement benefits or government deferred compensation. However, if you receive income from these sources as well as from other sources, then you must file an Illinois income tax return.
Additionally, a surviving spouse or designated representative must file an Illinois tax return on behalf of a recently deceased taxpayer. This occurs for both joint filings and single filings.
Also keep in mind that students are not exempt from filing a state income tax. There are also no special residency provisions for the student. But fellowships and scholarships are not subject to state taxes.
What Are the Forms to Use?
Tax form IL-1040 is used in all situations, if you were a
- full-time resident working in the state: You must use form IL-1040.
- full-time resident working out of state: You should use form IL-1040.
- part-time resident of the state: You must file form IL-1040 as well as schedule NR.
- retired resident of the state: You must file form IL-1040, noting the instructions if you have previously specified retirement benefits.
These forms can all be found on the Illinois department of revenue website.
What Is the Tax Rate in Illinois?
The current personal income tax rate has remained the same since 2017. It is 4.9 percent.
What Are the Filing Deadlines and Extension Process?
The due date for filing an individual Illinois income tax return is April 15 or the next business day, following the preceding tax year. So for your 2021 taxes, you must file before April 18, 2022.
If you receive a six-month extension for your federal income tax filing, then your Illinois state tax filing is automatically extended by six months.
Both corporations and S-corporations are required to make quarterly payments if they have an income of $400 dollars or more. This is based on estimated taxes. These payments are due on the 15th day of the 4th, 6th, 9th and 12th month of the tax year.
Partnerships are not required to make quarterly payments.
What Are the Penalties for Late Taxes and Underpayment of Taxes?
Filing and paying taxes on time is imperative if you don’t want a penalty or interest rates levied against you. Late filing or not filing your individual income tax return result in the lesser of a 2 percent fee or a $250 fee based on your owed taxes during the first 30 days that it is late.
The longer you go without filing and paying your taxes, the higher the penalty becomes. Penalties for non-payment of Illinois tax penalties vary, with:
- 2 percent fee if you are 30 days late
- 10 percent fee if you are 31 to 90 days late
- 15 percent fee if you are 91 to 180 days late
- 20 percent fee if you are 181 plus days late
There is a $25 flat fee for a returned check, and you will also be charged a late fee.
Where Do I Mail/E-file My Illinois Return?
There are two different addresses to which you can mail your return. It depends on if you are just filing or if you are filing and paying. If you are just filing and not sending a payment, the address for filing is: Illinois Department of Revenue, P.O. Box 19041, Springfield, IL 62794-9041.
If you want to mail your individual tax return with a payment, you need to use this address: Illinois Department of Revenue, P.O. Box 19027, Springfield, IL 62794-9027,
Besides mailing, you can also e-file your return. To do this, you must have a PIN. To obtain a PIN go to MyTax and enter the required information.
How Do I Pay Taxes Due?
You have several options for paying your Illinois state income tax:
- credit card (VISA, MasterCard, Discover American Express)
- MyTax Illinois
- check or money order
- ACH credit
If you use credit card, you will be charged a convenience fee by the credit card provider. When paying by check or money order, you will need to use the U.S. mail.
You can apply for a payment installment plan on owed taxes if you have financial hardships. This is an agreement with the Illinois Department of Revenue that you will pay your tax delinquencies on a monthly basis. The payment amount is based on your financial capability. To use this option, you must file your return on time. An application and approval are required. If the delinquency is more than $10,000, a different application is needed.
Where Can I Check My Illinois Refund Status?
You have two options of to check your refund status. You can go to "Where’s My Refund" or to the "Illinois Tax Refund System."
What About Illinois Taxes if You're Self-employed?
Self-employed people fall under the 4.9 percent tax rate. They'll need to make quarterly payments when estimated taxes are at least $1,000.
What About Illinois Taxes if You're a Business?
Businesses have a separate tax rate, dependent on the type of business:
- 7 percent for corporations
- 4.9 percent for S corporations
- 4.9 percent for electing partnerships
MyTax Illinois is a no-charge online account management program for businesses. It is part of the Illinois Department of Revenue and has several uses for businesses:
- registering for taxes
- filing returns
- making payments
- managing tax accounts
It is also a resource for individuals who wish to file online, check on extensions or request a letter identification number.
Rates and dates in this article are correct as of publication. But check for any changes at the Illinois Department of Revenue before you file.
- Illinois Revenue: Income Tax Rates
- Illinois Revenue: Filing Requirements
- Illinois Revenue: How Does Illinois Tax a Limited Liability Company (LLC)
- Illinois Revenue: Filing for a Deceased Taxpayer
- Illinois Revenue: 1040 Tax Form
- Illinois Revenue: Schedule NR
- Illinois Revenue: When is My Individual Income Tax Due
- Illinois Revenue: Do Corporations Have to Make Estimated Tax Payments
- Illinois Revenue: Are Partnerships Required to Make Estimated Payments?
- Illinois Revenue: Why do I Owe Illinois Tax When I Don’t Owe Federal Tax
- Ilinois Revenue: Will I Owe Penalties or Interest?
- Illinois Revenue: Penalties for Late taxes
- Illinois Revenue: Late Filing Fees and Penalties
- My Tax Illinois: IL PIN Inquiry
- Illinois Revenue: Make a Payment
- Illinois Revenue: Where’s My Refund
- My Refund: Find your Illinois Tax Refund
- Illinois Revenue: Payment Plans
Anne attended University of Akron and went on to have a career in television sales. Working as a commercial property and casualty insurance agent for nine years allowed her to learn about different businesses' needs. She has also owned an advertising agency where she created marketing capaigns for various clients. Anne has written for several publications. She currently resides in Charleston, SC.