Illinois employers to start withholding for new income tax
SPRINGFIELD, Ill. (AP) — The state of Illinois has officially given human resources departments the information they need to start deducting more from workers’ paychecks.
The Chicago Tribune reports that the Illinois Department of Revenue on Tuesday issued a release with specific details of implementing changes that accountants and employers need to enact the income tax hike that lawmakers approved last week. The individual income tax rate is now 4.95 percent, up from 3.75 percent. Corporations will pay 7 percent instead of 5.25 percent. It is retroactive to July 1 of this year.
The new money goes toward the first full state budget Illinois has had since summer of 2015.
The department’s announcement says that employers will change withholding amounts based on rate tables provided by the state.
Under the budget plan, the personal income tax rate rose from 3.75 percent to 4.95 percent, while the corporate income tax rate went from 5.25 percent to 7 percent.