Retire by state
Retiring in Illinois
Illinois does not tax retirement income, a benefit weighed against high property and sales taxes and hard Midwestern winters.
A fit if
Untaxed pensions, IRAs, and Social Security, plus Lake Michigan and Chicago's arts scene, outweigh the broader tax and weather picture.
Hard look if
Property taxes and sales taxes run high, and winters bring cold and snow that shape several months of the year.
Figures verified May 31, 2026.
Cost of living
100
BEA index, U.S. = 100
State income tax
~1.0%
Blended planning rate
Social Security
Not taxed
2026 state treatment
Town guides
1
Researched town in-state
How the plan models Illinois
The state lines the calculator actually changes.
These are the assumptions the planner applies for Illinois. They are blended, middle-bracket planning figures, not a tax return. Exemptions, county rules, and your own income mix can move the real number.
Cost of living
100
BEA regional price parities put Illinois very close to the U.S. average cost level. The U.S. average is 100.
BEA Regional Price ParitiesState income tax
~1.0%
Illinois does not tax Social Security in the summary used here, but a 1% blended planning rate is used for taxable retirement-income context. AARP lists Illinois among states that do not tax IRA and 401(k) distributions in the summary used here.
Tax FoundationSocial Security
Not taxed
Illinois does not tax Social Security benefits under the current state-tax summary used here.
AARP / IRS Pub. 915Property tax
2.2%
Property tax is local, but the Illinois state-level planning rate used here is 2.2% of home value. On a $350,000 home, that is about $7,800 a year before county detail.
Tax FoundationSales tax
9.0%
Tax Foundation puts Illinois's 2026 average combined state and local sales tax near 9.0%, ranked 8 among states in that table.
Tax FoundationVehicle costs
Registration line
Vehicle costs still belong in the budget, but the vehicle-tax source used here does not flag Illinois as a state where value-based vehicle property tax is the main planning issue.
FreeTaxUSA vehicle-tax guideLong-term care in Illinois
The care cliff, in Illinois dollars.
CareScout and Genworth 2025 median costs, compared with the national median. Long-term care is a separate planning layer from ordinary Medicare costs.
Assisted living
$6,219/mo
About $74,628 a year, about the same as the national median.
Nursing home (semi-private)
$8,304/mo
About $99,645 a year, 13% lower than the national median.
Home caregiver
$6,864/mo
About $82,368 a year, 3% higher than the national median.
Things to do in Illinois
What daily life can look like.
Starved Rock State Park canyons and waterfalls
Starved Rock State Park, along the Illinois River, is known for sandstone canyons and seasonal waterfalls. It has marked trails and overlooks, with some paved and accessible sections near the visitor center.
Illinois Department of Natural ResourcesLake Michigan shoreline and trails
Chicago and the northern suburbs keep miles of paved lakefront path along Lake Michigan. The flat, continuous trail is well suited to walking and cycling at an easy pace.
Illinois Office of Tourism (Enjoy Illinois)Chicago museums and music
Chicago supports a deep arts scene, from major art museums to symphony and theater. Many institutions offer senior pricing and sit near accessible public transit.
Illinois Office of Tourism (Enjoy Illinois)What to know about Illinois
The trade-offs worth weighing.
Retirement income is not taxed
Illinois does not tax the federally taxed portion of common retirement income, including IRAs, 401(k)s, pensions, and Social Security. Other income can still face the state income tax.
Illinois Department of RevenueHigh property and sales taxes
Illinois carries some of the higher property tax bills in the country, and combined state and local sales taxes are also high. These costs can offset the savings from untaxed retirement income.
AARPCold, snowy winters
Winters across Illinois bring cold temperatures and snow, with periods of dangerously cold wind chill. Snow and ice affect driving and walking for parts of the season.
National Weather ServiceRetirement towns in Illinois
Towns we have mapped in Illinois.
Weighing two states?
Put Illinois next to another state.
Compare cost of living, taxes, Social Security treatment, property and sales tax, and long-term-care costs side by side.
Common questions
Retiring in Illinois, answered.
Does Illinois tax retirement income?
Illinois does not tax Social Security benefits under the current state-tax summary used here. AARP lists Illinois among states that do not tax IRA and 401(k) distributions in the summary used here. Illinois does not tax Social Security in the summary used here, but a 1% blended planning rate is used for taxable retirement-income context.
AARP: how states tax retirement incomeIs Illinois cheaper or more expensive than average?
BEA regional price parities put Illinois very close to the U.S. average cost level. That price level is the first reason a national retirement number needs a Illinois translation.
BEA Regional Price ParitiesWhat does long-term care cost in Illinois?
In the CareScout and Genworth 2025 medians, Illinois assisted living runs about $74,628 a year (about the same as the national median) and a semi-private nursing-home room about $99,645 a year (13% lower than the national median).
CareScout / Genworth Cost of CareWhich towns in Illinois have a retirement guide?
Illinois has 1 researched town guide: Chicago. Each one breaks down local costs, services, and things to do.
Does Illinois tax pensions and Social Security?
No. Illinois does not tax the federally taxed portion of common retirement income, including IRAs, 401(k)s, pensions, and Social Security benefits. Other types of income can still be subject to the state income tax.
Illinois Department of RevenueIs Illinois expensive for retirees despite no tax on retirement income?
It can be. While Illinois does not tax retirement income, it has high property taxes and high combined sales taxes, which can offset that benefit. The overall cost depends a lot on the county and town you choose.
AARPSources
- BEA Regional Price Parities
- Tax Foundation: state tax data
- AARP: how states tax retirement income
- CareScout / Genworth Cost of Care
- IRS Publication 915 (Social Security benefits)
- Illinois Department of Natural Resources
- Illinois Office of Tourism (Enjoy Illinois)
- Illinois Office of Tourism (Enjoy Illinois)
- Illinois Department of Revenue
- AARP
- National Weather Service
Build the full map
See what Illinois does to your retirement plan.
Enter your real spending, income, home, and dreams. The planner applies the Illinois tax and cost assumptions for you, then shows the years the money has to last.
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