ILLINOIS RETIREMENT INCOME TAX · TAX YEAR 2026
Does Illinois tax Social Security and retirement income?
Illinois does not tax Social Security benefits. Illinois exempts pensions and 401(k) and IRA withdrawals, with no age, dollar or income limit. A single 67-year-old with $24,000 of Social Security, a $20,000 private pension and $10,000 of IRA withdrawals pays no Illinois income tax for 2026.
Your estimate
- Illinois income tax
- $0.00
- Federal income tax
- $1,810.00
- Total income tax
- $1,810.00
Subtracted from Illinois income
- Social Security
- $11,300.00
- Retirement income
- $30,000.00
- Age 65 exemption
- $1,000.00
Non-government deferred compensation, Form 4972 averaging and third-party sick pay, which are not subtracted, are not modeled.
Illinois tax at different retirement incomes
Illinois income tax for 2026 on a single 67-year-old with $24,000 of Social Security, and on a married couple, both 67, with $20,000 each. Half the pension and IRA income is a private pension and half IRA withdrawals, all received by one spouse in the couple.
| Pension and IRA income | Single | Married |
|---|---|---|
| $20,000 | $0 | $0 |
| $40,000 | $0 | $0 |
| $60,000 | $0 | $0 |
| $100,000 | $0 | $0 |
| $150,000 | $0 | $0 |
Does Illinois tax Social Security?
No. Illinois subtracts Social Security and Railroad Retirement benefits included in federal adjusted gross income.
Of the single 67-year-old's $24,000 in benefits, $11,300 is federally taxable and Illinois taxes none of it. Of the couple's $40,000, $28,100 is federally taxable and Illinois taxes none of it.
Does Illinois tax pensions?
No. Private pensions, government pensions and military retirement included in federal AGI are all subtracted. Deferred compensation from a non-government plan and lump sums taxed with federal 10-year averaging are not.
State tax for a single 67-year-old with $24,000 of Social Security, a $20,000 pension of each type and $10,000 of IRA withdrawals. Excluded is the part of the pension Illinois exempts.
| Pension | Excluded | State tax |
|---|---|---|
| Private | $20,000 | $0 |
| Illinois government | $20,000 | $0 |
| Federal civil service | $20,000 | $0 |
| Military | $20,000 | $0 |
Does Illinois tax IRA and 401(k) withdrawals?
No. IRA and 401(k) withdrawals are subtracted at any age, including early withdrawals and amounts converted to a Roth IRA.
With $24,000 of Social Security, $20,000 of IRA withdrawals and no other income, a single 67-year-old pays no Illinois income tax for 2026.
At what age do retirement tax breaks start in Illinois?
At 65, for an extra $1,000 exemption for each person 65 or older. The retirement income subtraction has no age requirement.
State tax at each age where the rules change. The single filer has $24,000 of Social Security, a $20,000 private pension and $10,000 of IRA withdrawals; the couple, both that age, has $20,000 of Social Security each and a $30,000 pension and $20,000 of IRA withdrawals.
| Age | Single | Married |
|---|---|---|
| 64 | $0 | $0 |
| 65Age 65 exemption | $0 | $0 |
What the calculator leaves out
Non-government deferred compensation, Form 4972 averaging and third-party sick pay, which are not subtracted, are not modeled.
The calculator uses Illinois rules from the 2025 forms and instructions, the latest published.
Federal tax uses the 2026 brackets, the standard deduction with the extra amount at 65, and the $6,000 senior deduction. Estimates assume no other deductions, credits or local taxes except as noted.