State Tax Laws - Illinois

Personal tax rates are a flat 5%. Exemptions are set at $2,100 per person, there is no standard deduction. Illinois does not tax distributions from any pension plans or social security, making it a good state to live in if you are going to convert an IRA to a Roth. Illinois does have an estate tax though, with a $4 million exemption.

Corporate taxes are a flat 9.5%, making S-corps and other pass-through entities look especially appealing in Illinois. Corporations must pay a $75 annual report fee, for LLCs this fee increases to $250 annually. Sales taxes are 6.25% and can be locally raised up to 10.5% Illinois tax information can be found at: http://www.revenue.state.il.us/. The Illinois Secretary of State for annual filings is located at: http://www.cyberdriveillinois.com/home.html


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