Personal income tax
• Illinois' tax is calculated by multiplying net income by a flat rate, currently 3 percent.
• The Illinois income tax is based, to a large extent, on the federal Internal Revenue Code.
• Residents must file Form IL-1040, Individual Income Tax Return, by April 17. Tax forms to download can be found here.


Personal and real property taxes
• The property tax is the largest single tax in Illinois, and is the major source of tax revenue for local government taxing districts.
• The property tax is a local -- not state -- tax, imposed by local government taxing districts which include counties, townships, municipalities, school districts, and special taxing districts.
• The property tax in Illinois is imposed only on real property and the tax cycle extends over two years.
• During the first year of the tax cycle, the property is assessed reflecting the property value as of Jan. 1 of that year. During the second year, the actual tax bills for the prior assessment year are calculated and payments collected from property owners (e.g., the tax for the 2005 assessment is paid in 2006).
• Most property in Illinois is assessed at 33.33 percent of its market value, except for farmland. Farmland is not assessed on its market value, but on its ability to produce income. Contact the tax assessor's office for exemptions and tax rates.
• Cook County is the only county in Illinois that differs. The assessment levels vary according to the type of property in this county.
• There are several homestead exemptions available for Illinois homeowners, including:
General Homestead Exemption is available annually for residential property that is occupied as the principal dwelling place by the owner or a lessee with an equitable interest in the property and an obligation to pay the property taxes on the leased property.
Senior Citizens Assessment Freeze Homestead Exemption allows senior citizens who have a total household income of less than $45,000, and meet certain other qualifications to elect to maintain the equalized assessed value (EAV) of their homes at the base year. Senior Citizens Homestead Exemption allows a $3,000 reduction in the EAV of the property that a person 65 years of age or older is obligated to pay taxes on, and owns and occupies, or leases and occupies as a residence.
Homestead Improvement Exemption is limited to the fair cash value that was added to the homestead property by any new improvement, up to an annual maximum.
Disabled Veterans' Exemption may be up to $58,000 of the assessed value for certain types of housing owned and used by a disabled veteran or his or her unmarried surviving spouse. The Illinois Department of Veterans' Affairs determines the eligibility for this exemption, which must be reestablished annually. For the 2006 tax year, the exemption increases to $70,000.
• In addition, the Senior Citizens Real Estate Tax Deferral Program allows persons 65 years of age and older who have a total household income of less than $40,000 and meet certain other qualifications, to defer all or part of the real estate taxes and special assessments on their principal residences. The deferral is similar to a loan against the property's market value and a lien is filed on the property in order to ensure repayment of the deferral.

Intangible personal property taxes

• Illinois does not levy an intangible personal property tax.

Inheritance and estate taxes

• There is no inheritance and limited Illinois estate tax related to federal estate tax collection.