Just over 5% of the average state income tax return supports economic development and public safety, while almost 28% goes to government worker pensions and benefits. Here’s a breakdown of how Illinois will spend your state income taxes.
By Lauren Zuar and FJ Hilgart | Illinois Policy Institute
With the highest combined state and local tax burden in the nation, Illinoisans are right to ask: What are we paying for?
The average Illinois personal income tax return was about $4,030 for fiscal year 2024. About half of that is split between public education and state worker pensions and other employee and operating costs.
The state taxes income at a flat rate of 4.95%. The number of returns has held roughly steady at 6.2 million, but the total tax collections have jumped from $17.3 billion in 2017 to $25.6 billion in 2024. Collections this year are projected to hit $27.75 billion and then $28.73 billion in 2026.
The amount per return has grown by $1,589 from 2017 to 2024.
Individual income taxes are just part of the load placed on Illinois families. When you consider Illinois’ combined state and local sales, excise, income and property taxes, the average household this year will pay $13,099, costing more than 16.5% of a family’s income.
The state distributes income tax dollars through the general funds budget to support everything from pensions to prisons to public health. How this money is allocated reveals the state’s financial priorities and whether taxpayers are getting value in return.
Here’s a breakdown of how Springfield spends Illinoisans’ income tax dollars:
Read on here.