This page lists Illinois Income Tax Act duties, 2026 numbers and penalties. Start with the overview. Payroll readers can use our state withholding guide; estimated tax and state tax notices have their own pages.
What the law requires
| Requirement | In plain words | Where to look |
|---|---|---|
| Register | Sign up with IDOR (Form REG-1 in MyTax Illinois) before hiring or making sales that create a tax account | IDOR registration page |
| Pay estimated tax | Four installments once expected tax passes the trigger | 35 ILCS 5/803, 5/804 |
| Withhold | 4.95% of employee pay, using IL-W-4 allowances and IL-700-T tables | 35 ILCS 5/701 |
| Deposit and report | Monthly by the 15th of the next month, or semiweekly; Form IL-941 each quarter, filed electronically | IDOR withholding page |
| Pass-through owners | An entity may elect PTE tax; otherwise it pays pass-through withholding for nonresident owners without Form IL-1000-E (only non-individual owners can give one) | 35 ILCS 5/201(p), 5/709.5 |
Key numbers and dates
| Item | Amount or date | Year in force | Source |
|---|---|---|---|
| Individual, trust and estate rate | 4.95% flat | 2026 | IDOR tax rates |
| C corporation rate | 7% plus 2.5% replacement tax | 2026 | IDOR tax rates |
| Personal exemption allowance | $2,925 (plus $1,000 each if 65 or older or legally blind) | Tax year 2026 | IDOR Q&A 851 |
| No exemption above federal AGI of | $250,000 (single, head of household, separate, widowed); $500,000 (joint) | Tax years 2025 and 2026 | IDOR Q&A 851 |
| Estimated tax triggers | Over $1,000 individuals; $400 C corporations; $500 electing PTE entities | 2026 | IL-1040-ES, IDOR |
| Safe harbor | 90% of this year's tax or 100% of last year's (if last year showed tax), in timely installments | 2026 | IDOR |
| IL-1040 | 15 April; automatic 6-month filing extension | Tax year 2025: 15 Apr 2026 | IDOR |
| IL-941 (2026 quarters) | 30 Apr, 31 Jul, 2 Nov 2026; 1 Feb 2027 | 2026 | Pub. 131-D |
Source: Illinois Department of Revenue tax rates
Recent and pending changes
- 16 June 2026 (in force): P.A. 104-0468, the 2026 revenue law, took effect on the Governor's approval; one IDOR bulletin says 1 July, but only two unrelated articles start then.
- Tax years beginning 1 January 2026 or later (in force): the bonus depreciation add-back covers IRC sections 168(k) and 168(n), so Illinois does not follow 100% bonus depreciation.
- Tax years ending 31 December 2026 or later (enacted): gain excluded under the federal QSBS rule (IRC 1202) is added back, and partnerships get a second PTE election method, per IDOR.
- PTE tax (in force): P.A. 104-0453 removed the expiration date on 12 December 2025. The tax applies in years when the federal SALT cap does.
- 1 January 2027 (enacted, pending): a 10% Targeted Advertising Services Tax on providers with over $1,000,000 of Illinois targeted-ad receipts, and a 0.2% Digital Asset Tax that brokers collect.
Penalties and enforcement
IDOR enforces the Act. A dispute usually starts with an IDOR notice, and the protest deadline is 60 days from a notice that states protest rights. The Tribunal hears cases where tax is over $15,000.
| Tier | Amount |
|---|---|
| Late filing | Lesser of $250 or 2% of the tax; 30 days after a nonfiling notice, an added greater of $250 or 2%, max $5,000 |
| Late payment | 2% (1 to 30 days late), 10% (31 or more); 15% if paid after an audit starts |
| Negligence and fraud | 20% and 50% of the deficiency |
| Unpaid withholding | Responsible person who willfully fails to pay: personal liability for tax, penalty and interest |
Official sources
- Illinois Department of Revenue: Income tax rates
- Illinois Department of Revenue: Business income tax estimated payments
- Illinois Department of Revenue: 2026 Publication 131-D, withholding due dates
- Illinois Department of Revenue: Publication 103, penalties and interest
- Illinois Department of Revenue: Received a notice about a deficiency or assessment
This page is a plain-language summary. The official source controls if there is any difference.