There is an Additional Medicare Tax of 0.9 percent withheld from employee’s paychecks if they earn more than $200,000 annually, regardless of their income tax filing status or wages earned at another job. If you’re married filing jointly, you’ll see the 0.9 percent taken out of your paycheck if you earn $250,000 or more. On the state level, you can claim allowances for Illinois state income taxes on Form IL-W-4.
Following the tables, we document notable individual income tax changes implemented in 2025. The historic tables, however, have been updated to account for retroactive changes. We offer a variety of calculators to suit your specific needs, these include tax calculators which are based on payroll timeframes and how salary packages and wages are advertised for job vacancies in Illinois.
Not many people start shouting with joy when they pay taxes, but they’re necessary in a functioning society. There are taxes on purchases, property, income, and plenty of other financial transactions. A pay stub is a tool you can use to understand how much taxes deducted from paycheck il how much money you have coming in and where your money is going.
Illinois boasts the fifth-largest gross domestic product (GDP) in the US with a diverse economy fueled by Chicago. This global financial hub is home to major corporations, the world’s biggest futures exchange, and a wide range of industries driving its impressive $1.033 trillion gross state product. If your W4 on file is in the old format (2019 or older), toggle “Use new Form W-4” to change the questions back to the previous form. However if you do need to update it for any reason, you must now use the new Form W-4.
Paycheck Calculator
If crunching all the numbers gets to be much too much, you have options. To automate most of the processes, including withholding taxes and deductions, try a payroll service provider as many handle this heavy lifting, so you have more time to focus on other aspects of your business. Use our hourly paycheck calculator to calculate withholdings and your employees’ net pay in a few clicks. For a single filer with standard deductions, the estimated take-home pay for a $70,000 salary in Illinois is approximately $52,000 – $54,000 after federal, state, and FICA taxes. Illinois paycheck calculator estimates the taxes deducted from your earnings as an employee, including Federal, Illinois State, Social Security and Medicare taxes. Use ADP’s Illinois Paycheck Calculator to estimate net or “take home” pay for either hourly or salaried employees.
If you have a lot of income that comes from non-work sources, like investments, the amount your employer withholds from your paychecks might not be enough to avoid ending up with a big tax bill. In this scenario, you may wish to fill out a new W-4 form and request that your employer withhold an additional amount from each of your paychecks. You can also pay estimated taxes every quarter to cover your bases with the IRS. Some employees in Illinois might have more money taken from each paycheck. For example, if you pay a share of premiums for health insurance, life insurance or disability insurance through your company, that money will be deducted from your earnings. You might also have money subtracted from your paycheck if you contribute to a 401(k), a flexible spending account (FSA) or a health savings account (HSA).
This averages at around $13,890 in taxes paid in 2022, and professionals foresee that the tax adjustments will see a 2.6% increase for the tax year 2025. Allowances provided to reduce taxable income are commonly known as “tax deductions” in the context of the United States tax system. Tax deductions lower your taxable income, and consequently, your tax liability. They are subtracted from your gross income, making the income subject to tax lower. For salaried employees, gross pay equals their annual salary divided by the number of pay periods per year.
Sales & Investments Calculators
The standard tax deduction is a fixed amount that taxpayers can subtract from their income to lower their taxable income. That being said, although the amounts have gone up for 2025, the differences from last year aren’t huge. This makes filing for every individual employee become significantly more complicated, especially when pay equity becomes involved in the process. Thankfully, there are programs that companies can use to help them process an employee’s pay, manage payroll taxes, while maintaining pay equity and provide continuous pay analysis in the long run. This means that the average financial accountant in the United States will have a take-home pay of $4,158 if pre-tax deductions are already taken out of their gross monthly salary.
- Illinois does not permit employers to deduct the cost of state unemployment taxes, or SUTA, from an employee’s paycheck.
- Calculations are based on the latest available federal and state withholding tables.
- This new version no longer asks you to list total allowances, as it instead uses a five-step process that lets you enter personal information, claim dependents and indicate any additional income or jobs.
- In theory, your W-2 is simply an aggregate of all pay stubs you received over the year.
- 1001 was adopted, further reducing the top marginal rate to 3.9 percent, retroactively effective as of January 1, 2024.
Whether or not you’re taxed (and how much) depends a lot on where you reside. However, the general formula when calculating an employee’s taxable income with pre-tax deductions considered can be seen below. 754, enacted in May 2023, reduced the top individual income tax rate from 5.84 percent in 2024 to 5.20 percent in 2025 and outlined the gradual reduction of the state’s top rate to 3.99 percent by 2027. Individual income taxes are a major source of state government revenue, accounting for 33 percent of state tax collections in fiscal year 2023, the latest year for which data are available. Their significance in public policy is further enhanced by individuals being actively responsible for filing their income taxes, in contrast to the indirect payment of sales and excise taxes.
Illinois Median Household Income
Illinois has a flat income tax of 4.95%, which means everyone’s income in Illinois is taxed at the same rate by the state. No Illinois cities charge a local income tax on top of the state income tax, though. Typically, the standard percentage deduction ranges from a 10% marginal rate to as much as 37%. This ensures pay equity among employees and ensures that everyone receives a good baseline pay. Some red flags to look out for on your pay stub include mistakes on key personal information such as your Social Security number or the spelling of your name. It is a good practice to review your pay stub when received and make sure there are no discrepancies.
This rate applies to residents on all sources of income and to non-residents on Illinois-sourced income. The state allows for certain deductions and credits that can affect your taxable income. If you have more than one job, you’ll need to split your allowances between your jobs.
Make sure to account for these wrinkles when you calculate paychecks for hourly workers. After using the paycheck calculator Illinois employers trust, you may be looking for ways to simplify running payroll and other back office tasks. OnPay is a top-rated online payroll service trusted by businesses across the US, with features that make the payroll process and administrative work less of a heavy lift.
Paycheck Calculators by State
Once you’ve figured out gross wages, it’s time to calculate your actual payroll by withholding federal, state, and local payroll taxes and applying any other deductions that might apply to an employee. This process basically works the same for all employees whether they are salaried or hourly. See more on how to set up payroll if you want to really get into the nitty gritty, too. The current Illinois state income tax rate is a flat 4.95% on all taxable income.
For example, you may live in a state that doesn’t collect state income taxes. Or, if you are on someone else’s healthcare plan, you won’t have any health plan deductions on your pay stub. 1001, enacted in May 2023, Indiana accelerated its previously enacted tax rate reductions, lowering the individual income tax rate from 3.05 in 2024 to 3.00 percent in 2025. The law also repealed previously enacted tax triggers, instead prescribing a rate reduction to 2.95 percent in 2026, and 2.9 percent in 2027 and beyond. 8, enacted in September 2023, the top individual income tax rate in Arkansas was reduced from 4.7 percent to 4.4 percent for tax years beginning on or after January 1, 2024. 1001 was adopted, further reducing the top marginal rate to 3.9 percent, retroactively effective as of January 1, 2024.
- Estimate your salary after taxes, deductions, and withholdings accurately.
- There is an Additional Medicare Tax of 0.9 percent withheld from employee’s paychecks if they earn more than $200,000 annually, regardless of their income tax filing status or wages earned at another job.
- Perhaps office supplies, repairs on your office computers, building repairs, or even purchasing your workers’ suitable clothing for their job (e.g. a plumber should be wearing a boiler suit).
- Enter your gross salary, pay frequency, and other relevant details to calculate your net income after all state and federal taxes.
Illinois Paycheck Calculator: Estimate Your Take-Home Pay Accurately
While the flat tax rate makes basic calculations straightforward, it’s important to consider local taxes and available credits that can impact your overall tax liability. Use our Illinois Paycheck Calculator to get a clear picture of your earnings and plan your finances effectively. Whether you’re salaried or hourly, this tool helps ensure accurate calculations, making budgeting and financial planning easier. Explore deductions and credits available, such as contributions to retirement accounts, to potentially lower your taxable income.
Additional Medicare Tax
In other states, the top rate kicks in at a much higher level of marginal income. For example, the top rate kicks in at or above $1 million in California (when the “millionaire’s tax” surcharge is included), Massachusetts, New Jersey, New York, and the District of Columbia. The purpose of these deductions is to reduce the amount of income that is subject to tax, thereby lowering the overall tax burden for an individual or household.