Retirement taxes by state
How Illinois taxes retirement income in 2026
Illinois has a flat 4.95% income tax. Here's how Illinois treats Social Security, retirement-account withdrawals, pensions and Roth conversions in 2026 — and what that means in dollars: a retired couple, both 67, with $98,000 of income pays about $106 in Illinois income tax.
Updated October 2026 · 2026 tax year
Illinois at a glance
- Flat 4.95% income tax.
- Social Security isn't taxed.
- Retirement income (pensions, 401(k)s, IRAs, Roth conversions) is fully exempt.
- Extra $1,000 deduction per person from age 65.
Illinois retirement tax questions
Does Illinois tax Social Security?
No. Social Security isn't taxed.
Does Illinois tax 401(k) and IRA withdrawals?
No. Retirement income (pensions, 401(k)s, IRAs, Roth conversions) is fully exempt. Also: extra $1,000 deduction per person from age 65.
Does Illinois tax pensions?
No. Retirement income (pensions, 401(k)s, IRAs, Roth conversions) is fully exempt.
Does Illinois tax Roth conversions?
No. Retirement income (pensions, 401(k)s, IRAs, Roth conversions) is fully exempt.
What is Illinois's income tax rate in 2026?
Illinois has a flat 4.95% income tax.
What retirees actually pay in Illinois: three examples
Calculated with Retirology's tax engine under 2026 law, using each state's standard deduction, its retirement breaks and the 2026 federal rules for how much Social Security is taxable. For the retired couple, Illinois ranks 27th lowest of the 50 states and DC.
| Household | Total income | Illinois tax | Share |
|---|---|---|---|
| Retired couple, both 67 $48,000 of Social Security, $40,000 drawn from IRAs and 401(k)s, and $10,000 of qualified dividends | $98,000 | $106 | 0.1% |
| Single retiree, 70 $30,000 of Social Security, a $25,000 pension and $15,000 of IRA withdrawals | $70,000 | $0 | 0.0% |
| Early-retired couple, both 56, converting to Roth A $60,000 Roth conversion and $20,000 of long-term gains and qualified dividends, living on savings | $80,000 | $700 | 0.9% |
State income tax only — before local taxes, property tax relief and credits not listed above. Federal income tax is extra and the same in every state.
Details and limits
All retirement income (pensions, 401(k)/IRA withdrawals, Roth conversions) is exempt at any age.
Sources
Rates and rules for the 2026 tax year, from Retirology's state tax data (reviewed October 2026):
This page explains state tax rules in general terms. It isn't tax advice — check your state's official instructions or a tax professional for your situation.