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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Illinois VS COUNTRY B South Carolina

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

Daniel · CountryTaxCalc Updated August 2026 Tax Comparison 2026
Calculate your take-home → See all comparisons →
OVERVIEW
South Carolina beats Illinois on both income tax and property tax at every income level we tested. At $100,000, South Carolina's $3,293 state income tax is $860/year lower than Illinois's $4,153 — a gap driven mostly by South Carolina's $18,050 tax-free band rather than a lower top rate (SC's 5% top rate is actually marginally higher than Illinois's 4.95% flat rate, so the income-tax gap narrows as income rises, from $885/year at $50,000 down to $660/year at $500,000). The bigger story is property tax: Illinois averages 1.88%, tied with New Jersey for the highest in the nation, while South Carolina averages just 0.49%, among the lowest. On a $400,000 home, that's roughly $7,520/year in Illinois property tax versus about $1,960/year in South Carolina — a $5,560/year difference that dwarfs the income-tax gap for homeowners. Illinois is genuinely retirement-friendly on the income-tax side (no state tax on Social Security, pensions, or 401(k)/IRA withdrawals), but its sky-high property tax offsets much of that advantage for homeowning retirees. South Carolina exempts Social Security entirely and offers a military retirement deduction up to $17,500, plus a low cost of living that appeals to relocating retirees and remote workers alike.
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% state rate on all taxable income — the highest flat-tax rate in the US; no local income tax anywhere in the state

🌴
COUNTRY B
South Carolina
TAX RATE
0% then 5%
Near-Flat (2 Brackets)

0% on the first $18,050 of taxable income, then a flat 5% above — reformed down from a 6-bracket system that topped out at 6.4%

TYPICAL ANNUAL DIFFERENCE
Moving from South Carolina → Illinois at $100,000
$860

That's $72/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
🌴 SC TAX
SAVINGS
10-YEAR
$50,000
$1,678
$793
$885
$8,850
$75,000
$2,916
$2,043
$873
$8,730
$100,000
$4,153
$3,293
$860
$8,600
$150,000
$6,628
$5,793
$835
$8,350
$250,000
$11,578
$10,793
$785
$7,850
$500,000
$23,953
$23,293
$660
$6,600
💡

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🌆

Illinois Pros & Cons

+ PROS
  • No state tax on any retirement income — Social Security, pensions, and 401(k)/IRA withdrawals are all fully exempt, more generous than South Carolina's Social Security-only exemption
  • Deep, high-paying job market in Chicago spanning finance, tech, professional services, and logistics that South Carolina's smaller metros can't match
  • No local income tax anywhere in the state, keeping the income-tax picture simple statewide
  • World-class culture, food, architecture, and transit in Chicago for those who value dense urban living
− CONS
  • The flat 4.95% state income tax costs $660 to $885/year more than South Carolina at every income level tested, even though SC's top rate (5%) is technically higher
  • Property tax averages 1.88%, tied with New Jersey for the highest in the nation — on a $400,000 home, that's about $7,520/year versus roughly $1,960/year in South Carolina
  • $139 billion in unfunded pension liabilities creates ongoing fiscal uncertainty and pressure for future tax increases
  • Combined income and property tax burden is among the highest in the US, a major driver of the state's ongoing outmigration
🌴

South Carolina Pros & Cons

+ PROS
  • Lower income tax at every level tested — $660 to $885/year cheaper than Illinois, plus a $18,050 tax-free band that shelters lower earners entirely
  • Property tax averages just 0.49%, among the lowest in the nation — roughly $5,560/year cheaper than Illinois on a $400,000 home
  • No tax on Social Security benefits, plus a military retirement deduction of up to $17,500 and a $50,000 homestead exemption for owner-occupied homes
  • Lower overall cost of living than Illinois, with a growing coastal and Upstate job market in manufacturing, logistics, and tech
− CONS
  • Retirement income beyond Social Security and the military deduction (regular pensions, 401(k), IRA withdrawals) is generally taxed as ordinary income, unlike Illinois's blanket retirement-income exemption
  • Smaller and less diversified job market than Chicago, with fewer finance, big-tech, and corporate-headquarters opportunities
  • Hurricane risk along the coast adds insurance costs that can offset some of the property-tax savings for coastal buyers
  • The 2026 tax reform is recent, so future legislative changes to the new 2-bracket structure are somewhat less battle-tested than Illinois's long-standing flat tax
FAQ

Frequently Asked Questions

Is Illinois or South Carolina cheaper for state income tax?

South Carolina is cheaper at every income level tested. At $100,000, South Carolina's $3,293 state tax is $860/year less than Illinois's $4,153. The gap narrows as income rises — from $885/year at $50,000 to $660/year at $500,000 — because South Carolina's 5% top rate is technically slightly higher than Illinois's flat 4.95%; the savings mostly come from South Carolina's $18,050 tax-free band.

Which state has lower property tax, Illinois or South Carolina?

South Carolina, by a wide margin. Illinois averages 1.88% effective property tax, tied with New Jersey for the highest in the nation. South Carolina averages just 0.49%, among the lowest. On a $400,000 home, that's about $7,520/year in Illinois versus roughly $1,960/year in South Carolina — a $5,560/year difference.

Does either state tax Social Security or retirement income?

Neither taxes Social Security. Illinois goes further, exempting all retirement income including pensions and 401(k)/IRA withdrawals. South Carolina exempts Social Security and offers a military retirement deduction up to $17,500, but other pension and retirement-account income is generally taxed as ordinary income at the state's 5% rate.

How much would I save moving from Illinois to South Carolina?

At $100,000 income, moving from Illinois to South Carolina would save about $860/year in state income tax. Add property tax savings on a typical home — roughly $5,560/year on a $400,000 house — and total annual savings could exceed $6,000/year for a homeowner, before accounting for South Carolina's generally lower cost of living.

Why does Illinois have such high property taxes?

Illinois's property tax burden stems largely from local government funding structures and roughly $139 billion in unfunded public pension liabilities, which push school districts and municipalities to rely heavily on property tax revenue. This has kept Illinois's average effective rate at 1.88%, tied with New Jersey for the highest in the country.

Is South Carolina a good state to retire in compared to Illinois?

For most retirees, yes. South Carolina combines no Social Security tax, a $17,500 military retirement deduction, a $50,000 homestead exemption, and property tax averaging just 0.49% with a lower overall cost of living. Illinois offers a broader retirement-income exemption on paper, but its 1.88% average property tax often outweighs that benefit for homeowners.

Does Illinois or South Carolina have a better job market?

Illinois has the deeper, higher-paying job market overall, anchored by Chicago's finance, technology, professional-services, and logistics sectors. South Carolina's job market is smaller but growing, with strengths in manufacturing (including automotive and aerospace), logistics around the Port of Charleston, and an expanding tech presence in Charleston and Greenville.

How did South Carolina's 2026 tax reform change the comparison with Illinois?

South Carolina replaced its old 6-bracket system (0% to 6.4%) with just two brackets: 0% up to $18,050, then a flat 5% above. Under the old system, South Carolina was less competitive with Illinois at many income levels; the reform widened South Carolina's advantage, especially for middle-income earners who previously paid close to the 6.4% top rate on most of their income.
From the brief
NL27%new 2027 rate, down from 30%
DK65.4kkr/mo threshold, cut from 78k
MT1940snon-dom regime unchanged since
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