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Does Illinois tax my pension, social security, or retirement income?

Answer #99 -- ( Published 08/05/2005 09:49 AM | Updated 07/12/2017 10:41 AM )

Does Illinois tax my pension, social security, or retirement income on my individual income tax return?

Illinois does not tax distributions received from:

  • qualified employee benefit plans, including 401(K) plans; 
  • an Individual Retirement Account, (IRA) or a self-employed retirement plan; 
  • a traditional IRA that has been converted to a Roth IRA;
  • the redemption of U.S. retirement bonds; 
  • state and local government deferred compensation plans; 
  • a government retirement or government disability plan, including military plans; 
  • railroad retirement income; 
  • retirement payments to retired partners; 
  • a lump sum distribution of appreciated employer securities; and 
  • the federally taxed portion of Social Security benefits

if the income is included in your federal adjusted gross income on Form IL-1040, Line 1.

For more information see Publication 120, Retirement Income, or the Form IL-1040 Instructions for Line 5.

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