Living in Wisconsin, working in Illinois
Reciprocal agreement · tax year 2026
You pay Wisconsin
$2,701
on a seventy-thousand wage
Illinois would want
$3,320
The agreement is worth
$619
a year
File this
IL-W-5-NR
with your employer
What the agreement does for you
- This one pays. Living in Wisconsin and working in Illinois, a seventy-thousand-dollar wage owes $2,701 at home. Illinois would have charged $3,320. The agreement means you pay the lower one, keeping $619 a year that would otherwise have gone across the border.
- Watch what happens as the salary grows. At forty-five thousand dollars Wisconsin takes $1,365. At a hundred thousand it takes $4,482, while Illinois would have wanted $4,805. The distance between two states is rarely a fixed amount — it is a function of what you earn.
- One piece of paper stands between you and this. Your employer needs the Illinois exemption certificate from you, usually once a year. Without it they must keep withholding Illinois tax from a Wisconsin resident. You would then be filing a return there after all.
- The Wisconsin–Illinois agreement delivers a substantive reduction for this direction of travel. On seventy thousand dollars of wages the home charge is $2,701 and the work state's would be $3,320, a spread of $619. ⚠️ The spread, not the work state's gross figure, is the correct measure: the ordinary resident-credit mechanism would otherwise leave a commuter paying approximately the higher of the two amounts in total across both returns.
- Scaling matters here: Wisconsin charges $1,365 on forty-five thousand dollars and $4,482 on one hundred thousand, where Illinois would levy $4,805 on the latter. Because state schedules differ in both rate and structure, the interstate differential is a function of income rather than a constant, and comparisons drawn at a single salary generalize poorly.
- The benefit is conditional on filing the exemption certificate with the employer, typically renewed annually. ⚠️ Employer withholding defaults to the work state in its absence, irrespective of eligibility, and the remedy is a nonresident return in Illinois. The practical failure mode is therefore not ineligibility but non-election — the agreement exists and the commuter simply never claims it.
What lands in your account
A $75,000 salary
Filing as
Paid
$2,254per paycheck
| Take-home, year | $58,595 |
|---|---|
| Tax, year | $16,405 |
| Share of pay taxed | 21.87% |
This is an average rate across all your pay — not the rate on your next dollar.
Wisconsin against Illinois
A $75,000 salary
Compare with
−$4,243a year in Illinois, once local prices are leveled
| Measure | Wisconsin | Illinois |
|---|---|---|
| Take-home pay | $58,595 | $58,025 |
| Worth after local prices | $62,939 | $58,697 |
| Share of pay taxed | 21.87% | 22.63% |
| State sales tax | 5% | 6.25% |
| Groceries exempt here | Yes | Yes |
| Clothing exempt at $100 | No | No |
| Property tax rate | 1.42% | 2.01% |
| Price level | 93.1 | 98.9 |
| Housing prices | 78.3 | 92.4 |
| Fuel tax | 30.9¢ | 49.6¢ |
| Tobacco tax | $2.52 | $2.98 |
City income tax excluded. Sales-tax row: state-only. Exemptions: Wisconsin, Statewide average; Illinois, Statewide average. Clothing: one $100 item; higher prices can change tax.
What you would need there
A $75,000 salary
Moving to
$81,413in Illinois, for the same life
| To match take-home only | $75,872 |
|---|---|
| Raise you would need | +$6,413 |
| Prices in Illinois | 99 vs 93 |
State taxes and state price levels only. No city tax, and no housing market.
What each state would charge, across the ladder
Reference wages for a single filer, not a claim about anyone's salary. The last column is the difference the agreement actually removes — which is the gap between the two states, not Illinois's whole charge.
| Wage | Wisconsin charges | Illinois would charge | Agreement is worth |
|---|---|---|---|
| $45,000 | $1,365 | $2,083 | $718 |
| $70,000 | $2,701 | $3,320 | $619 |
| $100,000 | $4,482 | $4,805 | $323 |
What this page cannot tell you
- This covers wages from a job. It does not cover self-employment, rent or investment income — those follow the ordinary rules for Illinois.
- ⚠️ And it is a deal between two states. City and county taxes are not part of it, and several of these states have them.
- The comparison here assumes a single filer and treats both states as taxing the same income. Your own numbers will differ.
- Every agreement in this dataset applies to wages and salaries only. Business, rental, gain and investment income sourced to Illinois remains taxable there under ordinary nonresident rules, and a commuter with such income may still owe a Illinois return notwithstanding the agreement.
- ⚠️ Reciprocity binds the state layer only and commonly does NOT extend to municipal or county income taxes — Pennsylvania's local earned income tax is the standard example, remaining payable at the place of employment despite the state-level agreement. Local liabilities are excluded from every figure on this page.
- Figures are computed for a single filer at the stated wage, treating Wisconsin's and Illinois's definitions of taxable income as equivalent and modeling the resident credit as limited to the home state's own liability. Real returns diverge on filing status, deductions each state allows separately, and credit limitation rules — so these are comparative magnitudes, not a computation of anyone's liability.