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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Illinois VS COUNTRY B Texas

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

Daniel · CountryTaxCalc Updated May 2026 Tax Comparison 2026
Calculate your take-home → See all comparisons →
OVERVIEW
Illinois is tied with New Jersey for the highest average property tax rate in the United States at 1.88% — significantly above Texas at 1.40%. On a $400,000 home, Illinois homeowners pay approximately $1,920 more per year than their Texas counterparts. Unlike Texas, Illinois also levies a flat state income tax (4.95%), meaning Illinois households face a double burden: high property tax AND income tax. Texas homeowners pay more than many states but benefit from zero state income tax, making the overall Texas burden lower for most earners. Chicago and its suburbs are particularly expensive — effective rates in Cook County often exceed 2.5%.
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
1.88%
Avg Effective Rate

Tied for highest in the US (with New Jersey); no assessment growth cap; Chicago suburbs especially high

🤠
COUNTRY B
Texas
TAX RATE
1.40%
Avg Effective Rate

High but below Illinois; $100K homestead exemption; no state income tax

TYPICAL ANNUAL DIFFERENCE
Moving from Texas → Illinois at $400,000 home
$1,920

Texas saves on property tax

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
🤠 TX TAX
SAVINGS
10-YEAR
$250,000 home
$4,700
$3,500
$1,200
$12,000
$350,000 home
$6,580
$4,900
$1,680
$16,800
$400,000 home
$7,520
$5,600
$1,920
$19,200
$500,000 home
$9,400
$7,000
$2,400
$24,000
$700,000 home
$13,160
$9,800
$3,360
$33,600
$1,000,000 home
$18,800
$14,000
$4,800
$48,000
💡

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🌾

Illinois Pros & Cons

+ PROS
  • Does not tax most retirement income (pensions, 401k distributions)
  • Relatively low flat income tax rate (4.95%) vs progressive states
  • Homestead exemption: $10,000 off equalized assessed value
  • Freeze programs for seniors 65+ meeting income tests
− CONS
  • Tied for the highest property tax rate in the US (with New Jersey)
  • No assessment growth cap like California's Prop 13
  • Chicago suburbs among most expensive in the nation
  • State income tax at 4.95% on top of property tax
🤠

Texas Pros & Cons

+ PROS
  • No state income tax
  • Lower property tax than Illinois (~25% less)
  • Homestead exemption: $100,000 off taxable value for school tax
  • Over-65 school tax freeze
− CONS
  • Property tax still high compared to most states
  • High homeowners insurance in some areas
  • MUD/special district taxes can add 0.3–0.8% more
  • No cap on general assessment increases
FAQ

Frequently Asked Questions

Why does Illinois have such high property taxes?

Illinois's high property taxes stem from several structural factors: a heavily fragmented local government system (over 7,000 taxing districts — the most in the US), heavy reliance on property tax to fund schools, no overall assessment growth cap (unlike California's Prop 13), and decades of underfunded public pensions that drive up local levy requirements. Illinois is tied with New Jersey for the highest effective property tax rate nationally, at 1.88%. Chicago's Cook County averages 2.5–3% effective rate in many suburbs. The state has been unable to shift revenue from property tax to income tax due to constitutional constraints.

Does Illinois tax pensions, making Texas more attractive for retirees?

Illinois actually does NOT tax retirement income — all pension income, 401(k)/IRA distributions, Social Security, and military retirement pay are exempt from Illinois income tax. This is one of Illinois's genuine tax advantages for retirees. However, the high property tax still affects retired homeowners significantly: a retiree with a $400,000 Illinois home pays approximately $7,520/year in property tax versus $5,600 in Texas — a real annual cost even for those with zero income tax liability in Illinois.

Where in Texas has property tax rates similar to Illinois?

Some Texas jurisdictions have effective rates approaching or exceeding Illinois's average: Harris County (Houston) suburbs with MUD districts can reach 2.0–2.5% total effective rates; Fort Bend County (southwest Houston) averages approximately 2.1%; some Dallas suburban MUD districts reach 2.2–2.5%. These areas are the exception — but Texans in high-rate jurisdictions can pay Illinois-level property taxes without the IL income tax benefit. Using our calculator with your specific zip code gives a more accurate picture.

What is the total tax burden comparison between Illinois and Texas?

For a household earning $100,000 with a $400,000 home: Illinois: property tax ~$7,520 + income tax ~$4,950 (flat 4.95%) = approximately $12,470 in combined property + state income tax. Texas: property tax ~$5,600 + income tax $0 = $5,600. Texas saves approximately $6,870/year in this scenario — with the savings growing the higher the income. For households earning $200,000: Illinois income tax adds ~$9,900; Texas adds $0. The total Illinois vs Texas tax differential is substantial at most income and home value combinations.
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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