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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Illinois VS COUNTRY B Massachusetts

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

Daniel · CountryTaxCalc Updated August 2026 Tax Comparison 2026
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OVERVIEW
Illinois and Massachusetts have nearly identical flat income tax rates — Illinois at 4.95% and Massachusetts at 5% — making the income-tax gap the smallest in this batch of comparisons: just $42/year at $100,000 income ($4,153 in Illinois vs $4,195 in Massachusetts), widening only slightly to $243/year at $500,000. Property tax tells a much bigger story: Illinois's average effective rate (~1.88%, tied for the highest in the US with New Jersey) is more than 50% higher than Massachusetts's (~1.23%), a gap worth about $2,600/year on a $400,000 home. Combined income-plus-property tax at $100,000 income and a $400,000 home actually favors Massachusetts by roughly $2,558/year, despite its slightly higher income tax rate — the property tax difference dominates. Neither state charges local income tax anywhere, so city-level add-ons aren't a factor for either. On retirement income, Illinois is considerably more generous: it fully exempts Social Security, pensions, and 401(k)/IRA withdrawals from state tax, while Massachusetts has no blanket exemption and taxes most retirement account withdrawals at the full 5% flat rate.
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 — highest flat-tax rate in the US; no local income tax anywhere
🏛️
COUNTRY B
Massachusetts
TAX RATE
5%
Flat Tax + Surtax
5% flat rate, plus 4% surtax on income over $1 million; no local income tax anywhere
TYPICAL ANNUAL DIFFERENCE
Moving from Massachusetts → Illinois at $100,000
$42
That's $4/month back in your pocket
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
🏛️ MA TAX
SAVINGS
10-YEAR
$50,000
$1,678
$1,695
$17
$170
$75,000
$2,916
$2,945
$29
$290
$100,000
$4,153
$4,195
$42
$420
$150,000
$6,628
$6,695
$67
$670
$250,000
$11,578
$11,695
$117
$1,170
$500,000
$23,952
$24,195
$243
$2,430
💡

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🌽

Illinois Pros & Cons

+ PROS
  • Slightly lower flat income tax than Massachusetts (4.95% vs 5%) at every income level, though the gap is small — just $17 to $243/year
  • Fully exempts retirement income: Social Security, pensions, and 401(k)/IRA withdrawals are all tax-free at the state level, at any age
  • No local income tax anywhere in the state — no city adds a wage tax on top of the flat state rate
  • Chicago's deep finance, tech, and manufacturing job market offers salaries that can outweigh the state's high property tax burden
− CONS
  • Highest average property tax in the country (tied with New Jersey at ~1.88%) — about 53% higher than Massachusetts's ~1.23%, enough to flip the combined burden in Massachusetts's favor on a $400,000+ home
  • $139 billion in unfunded pension liabilities creates ongoing risk of future tax increases
  • Illinois's flat 4.95% applies from the first dollar of taxable income, with no $0 bracket like Ohio's to soften the burden for lower earners
  • The income-tax savings over Massachusetts are marginal (4.95% vs 5%) and easily erased by Illinois's much higher property tax
🏛️

Massachusetts Pros & Cons

+ PROS
  • Much lower average property tax (~1.23%) than Illinois (~1.88%, tied for highest in the US) — saves about $2,600/year on a $400,000 home
  • On combined income-plus-property tax at $100,000 income with a $400,000 home, Massachusetts comes out roughly $2,558/year cheaper than Illinois overall
  • World-class biotech, healthcare, and higher-education job markets (Boston/Cambridge) with salaries that often exceed the Midwest
  • No local income tax anywhere in the state — a Boston resident pays only the 5% flat state rate, no city add-on
− CONS
  • Slightly higher flat income tax rate than Illinois (5% vs 4.95%) at every income level, though the dollar gap is small
  • No blanket retirement-income exemption — pensions and 401(k)/IRA withdrawals are taxed at the full 5% rate, unlike Illinois's full exemption
  • 4% surtax applies to income over $1 million (total 9%), a consideration for high earners that Illinois's flat 4.95% doesn't have
  • Far higher cost of living, especially housing, in the Boston metro area compared to most of Illinois outside Chicago
FAQ

Frequently Asked Questions

Is Illinois or Massachusetts cheaper for state income tax?

They're nearly tied. Illinois is marginally cheaper at every income level — at $100,000, Illinois's flat 4.95% costs $4,153 versus Massachusetts's flat 5% at $4,195, a difference of just $42/year. That gap grows only slightly to $243/year at $500,000, since the two rates differ by just 0.05 percentage points.

Which state has lower property tax, Illinois or Massachusetts?

Massachusetts has the clearly lower average effective property tax rate at roughly 1.23%, compared to Illinois's roughly 1.88% — tied for the highest in the US with New Jersey. On a $400,000 home, that's about $4,920/year in Massachusetts versus $7,520/year in Illinois, a savings of about $2,600/year.

So which state actually wins on combined income plus property tax?

Massachusetts wins clearly once property tax is added in. At $100,000 income with a $400,000 home, Massachusetts's combined bill (about $9,115) is roughly $2,558/year lower than Illinois's (about $11,673), because Massachusetts's large property-tax savings easily outweigh Illinois's tiny $42/year income-tax edge.

Does either state tax retirement income like 401(k) and IRA withdrawals?

Illinois fully exempts Social Security, pensions, and 401(k)/IRA withdrawals from state tax at any age. Massachusetts has no such blanket exemption and taxes most pensions and retirement account withdrawals at the full 5% flat rate (Social Security itself is not taxed by either state). For retirees drawing heavily on a 401(k) or pension, Illinois is meaningfully more favorable.

How much would I save moving from Massachusetts to Illinois?

At $100,000 income, moving from Massachusetts to Illinois saves only about $42/year in state income tax — essentially a rounding error. Once you factor in Illinois's much higher property tax (~1.88% vs Massachusetts's ~1.23%), most homeowners would actually come out behind by moving, unless they're renting or the income-tax gap matters more at a specific income level.

Why is the income tax difference between Illinois and Massachusetts so small?

Both states use flat tax rates that are almost identical — Illinois at 4.95% and Massachusetts at 5%, just 0.05 percentage points apart. Because both are flat rates applied after the same federal standard deduction basis, the dollar gap scales minimally with income: about $17 at $50,000, growing to only $243 at $500,000.

Does Massachusetts's millionaire surtax affect this comparison?

No. The 4% surtax applies only to income over $1 million, well above the $500,000 top income tested here. A Massachusetts resident earning $1.5 million would pay 5% on the first $1 million plus 9% (5%+4%) on the remaining $500,000, but that scenario falls outside the range most readers comparing these two states will fall into.

Is Chicago or Boston better for job opportunities?

Chicago offers a broader mix of finance, technology, manufacturing, and logistics employers with a lower cost of living than Boston. Boston/Cambridge has a more concentrated, higher-paying biotech, pharmaceutical, and higher-education cluster (Moderna, Biogen, MIT, Harvard) that can command premium salaries offsetting Massachusetts's marginally higher tax rate.
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