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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Illinois VS COUNTRY B Maryland

Side-by-side analysis of income tax, effective rates, and take-home pay for Illinois and Maryland in 2026.

Daniel · CountryTaxCalc Updated August 2026 Income tax verified October 2026 Tax Comparison 2026
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OVERVIEW
Illinois's flat 4.95% income tax is the highest flat rate of any US state, yet on state income tax alone Maryland is cheaper from $50,000 through $150,000 (at $100,000, $4,384 versus Illinois's $4,805, a $421/year edge for Maryland), while Illinois is cheaper from roughly $188,000 up ($343/year at $250,000 and $2,190/year at $500,000). The table shows state income tax only: every Maryland resident also owes a mandatory county income tax (2.25%-3.3% by county; a representative 3.2% rate, charged by Maryland's most populous counties, would add about $2,989 at $100,000 income) and Illinois has none, so with county tax Illinois is cheaper at every income level tested ($4,805 versus about $7,373 at $100,000). Property tax tells a different story: Maryland's average effective rate of roughly 0.92% is well below Illinois's roughly 1.88% (tied for the highest in the nation with New Jersey), so at $100,000 income with a $400,000 home, Illinois's higher property tax bill ($7,520 vs Maryland's $3,680, a $3,840/year gap) actually outweighs its income-tax advantage — keeping Maryland the cheaper state overall at that income level, by about $1,272/year (including a 3.2% Maryland county tax). Illinois pulls ahead on the combined basis too above roughly $133,000 income. Neither state's local tax is optional in the way Pennsylvania's Philadelphia wage tax is — Illinois has none at all, while Maryland's county tax applies to literally every resident regardless of where they live in the state. On retirement income, Illinois is more generous: it fully exempts Social Security, pensions, 401(k), and IRA withdrawals with no exceptions, while Maryland also leaves Social Security untaxed but taxes IRA withdrawals, and pension and 401(k) income beyond an exclusion of up to $41,200 (tax year 2025) for filers 65+ or totally disabled, reduced by Social Security received.
Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

🌽
COUNTRY A
Illinois
TAX RATE
4.95%
Flat Tax

Flat 4.95% rate on all income — the highest flat-tax rate of any US state; no local income tax anywhere

🦀
COUNTRY B
Maryland
TAX RATE
2-6.5%
10-Bracket Progressive + Mandatory County Tax

10 state brackets (2-6.5%) plus a mandatory county income tax (2.25-3.3%) that every resident must pay

TYPICAL ANNUAL DIFFERENCE
Moving from Illinois → Maryland at $100,000 with $400K home
$1,272

Combined income tax (Maryland state + a representative 3.2% county tax) + property tax at $100K income with a $400K home, favoring Maryland. On state income tax alone, Maryland is $421/year cheaper at $100K ($4,384 vs Illinois's $4,805); including about $2,989 of Maryland county tax, Illinois is cheaper by $2,568. But Illinois's much higher property tax rate (1.88% vs Maryland's 0.92%) more than offsets that at $100K income on a $400K home, keeping Maryland the cheaper state overall at that income level by about $1,272/year. Illinois becomes cheaper on the combined basis too above roughly $133,000 income (see incomeTable for state income-tax figures at every level).

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME
🌽 IL TAX
🦀 MD TAX
SAVINGS
10-YEAR
$50,000
$2,330
$2,009
-$321
-$3,210
$75,000
$3,568
$3,197
-$371
-$3,710
$100,000
$4,805
$4,384
-$421
-$4,210
$150,000
$7,280
$7,040
-$240
-$2,400
$250,000
$12,230
$12,573
$343
$3,430
$500,000
$24,750
$26,940
$2,190
$21,900
💡

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🌽

Illinois Pros & Cons

+ PROS
  • Flat 4.95% state income tax beats Maryland's state-plus-county system (with a 3.2% county tax) at every income level shown, and beats Maryland's state tax alone above roughly $188,000
  • Full retirement-income exemption: Social Security, pensions, 401(k), and IRA withdrawals are all completely tax-free, with no income threshold
  • No local income tax anywhere — unlike Maryland, where every resident owes a mandatory county tax on top of the state rate
  • Chicago offers one of the deepest job markets in the Midwest across finance, tech, manufacturing, and healthcare
− CONS
  • Average property tax (~1.88%) is tied for the highest in the nation with New Jersey, well above Maryland's ~0.92%
  • Illinois's flat 4.95% is the highest flat-tax rate of any US state, even though it still beats Maryland's state-plus-county income tax at every level shown
  • Illinois has a state estate tax on estates over $4 million — Maryland's estate/inheritance rules differ and should be checked directly with a CPA
  • $139 billion in unfunded pension liabilities creates ongoing fiscal pressure that could push rates higher in the future
🦀

Maryland Pros & Cons

+ PROS
  • Lower average property tax (~0.92%) than Illinois (~1.88%), which more than offsets Maryland's higher income tax at $100K income for homeowners — keeping Maryland cheaper overall at that income level despite Illinois's lower income tax rate
  • Social Security is not taxed in Maryland, and filers 65+ get up to a $41,200 pension exclusion (tax year 2025; IRA withdrawals do not qualify)
  • Deep federal, biotech, and defense-contractor job market anchored by NIH, Johns Hopkins, and DC-suburb agencies
  • Montgomery County schools rank among the top 20 nationally, a draw for families willing to pay the higher combined tax rate
− CONS
  • Every resident pays a mandatory county tax (2.25-3.3%; a representative 3.2% is used for county-inclusive figures here) on top of the state rate — not included in the table, no opt-out
  • Combined state-plus-county tax (at a 3.2% county rate) costs about $1,068 to $18,081/year more than Illinois's flat 4.95% at every income level shown — though Maryland's much lower property tax rate keeps it cheaper overall at $100K income on a typical home
  • The pension exclusion shrinks dollar for dollar by Social Security received (zero at $41,200 or more), so retirees with larger Social Security benefits get a smaller exclusion
  • Pensions and 401(k) income are taxable beyond the $41,200 (tax year 2025) age-65+ exclusion (reduced by Social Security received), and IRA withdrawals do not qualify for it at all, far less generous than Illinois's full exemption
FAQ

Frequently Asked Questions

Is Illinois or Maryland cheaper for state income tax?

It depends on whether Maryland's county tax is counted. On state income tax alone, Maryland is cheaper from $50,000 to $150,000 (at $100,000, $4,384 versus Illinois's flat 4.95% at $4,805) and Illinois is cheaper from roughly $188,000 up ($2,190/year at $500,000). Maryland residents also owe a mandatory county income tax; with a representative 3.2% rate, Maryland's total at $100,000 is about $7,373, so Illinois is cheaper by about $2,568/year, growing to about $18,081/year at $500,000. But Maryland's much lower property tax rate reverses that at $100,000 income once you own a typical $400,000 home — see the next question.

What is Maryland's county tax and why can't I avoid it?

All 23 Maryland counties plus Baltimore City levy a mandatory local income tax on top of the state's 2-6.5% rate. Unlike most states where local income tax is optional or limited to certain cities, every Maryland resident pays county tax based on where they live on December 31 — there's no county in the state that charges $0. Real rates range from 2.25% (Worcester, the lowest) to 3.3% (Dorchester and Kent, the highest); a representative 3.2% rate — the rate charged by Maryland's most populous counties, including Montgomery and Baltimore City — is used here for county-inclusive totals, but the comparison table shows state income tax only.

Which state has lower property tax, Illinois or Maryland?

Maryland has the lower average effective property tax rate at roughly 0.92%, compared to Illinois's roughly 1.88% — tied for the highest in the nation with New Jersey. On a $400,000 home, that's about $3,680/year in Maryland versus $7,520/year in Illinois, a savings of about $3,840/year that more than offsets Illinois's income-tax advantage at $100,000 income — which is why Maryland is still cheaper overall for a $100K earner with a $400K home despite Illinois's lower income tax rate.

So which state wins on combined income plus property tax?

Maryland wins at $100,000 income on the combined basis, but not on state-plus-county income tax: Illinois's total (about $4,805 income + $7,520 property = $12,325 on a $400,000 home) versus Maryland's (about $4,384 state + $2,989 county at a 3.2% rate = $7,373 income + $3,680 property = $11,053) — Maryland comes out about $1,272/year cheaper overall, purely because its much lower property tax rate outweighs Illinois's income-tax advantage at this income level. Illinois wins on state-plus-county income tax at every level shown, and overtakes Maryland on the combined basis too above roughly $133,000 income.

Does either state tax retirement income like Social Security or 401(k) withdrawals?

Illinois fully exempts all retirement income — Social Security, pensions, 401(k), and IRA withdrawals — with no income limit. Maryland is less generous on other retirement income: Social Security is not taxed in Maryland either, but pension and 401(k) income gets an exclusion of up to $41,200 (tax year 2025) for filers 65+ or totally disabled, reduced by Social Security received (IRA withdrawals do not qualify), before the remainder is taxed at Maryland's combined state-plus-county rates. Illinois is one of the most retirement-friendly states in the country on this measure.

How much would I save moving from Maryland to Illinois?

At $100,000 income, moving from Maryland to Illinois would save about $2,568/year on income tax once Maryland's county tax (a representative 3.2%) is included, even though Maryland's state tax alone is $421 lower — Illinois is the cheaper state on state-plus-county income tax at every level shown. At $500,000, that income-tax savings grows to about $18,081/year. But Illinois's much higher property tax (~1.88% vs Maryland's ~0.92%) can outweigh the income-tax savings for homeowners at lower incomes: on a $400,000 home at $100,000 income, Maryland is still about $1,272/year cheaper overall once property tax is included.

Why is Illinois's tax considered high despite being cheaper than Maryland here?

Illinois's flat 4.95% is genuinely the highest flat-tax rate among all US states, and its property tax is tied for the nation's highest. It comes out ahead of Maryland on state-plus-county income tax at every level shown (Maryland's county tax, a representative 3.2%, is not included in the table, which shows state tax only). But Illinois's very high property tax rate can still make Maryland the cheaper state overall for homeowners at lower incomes, once property tax is factored in.

Does living in a specific Maryland county change this comparison?

Yes. The county-inclusive figures in this comparison use a representative 3.2% county rate — the rate charged by Maryland's most populous counties, including Montgomery and Prince George's. Residents of low-tax counties like Worcester (2.25%) pay somewhat less than the figures shown, while residents of the highest-rate counties (Dorchester and Kent, 3.3%) pay somewhat more. Illinois has no local income tax variation to consider since none exists statewide.
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