July 7, 2026·9 min read

Illinois Self-Employed Taxes: The Complete 2026 Guide

Illinois taxes all personal income — including self-employment profit — at a flat 4.95% rate. Add federal income tax and 15.3% SE tax and most Illinois freelancers land at a 26–34% effective rate. Estimate yours with our [Illinois self-employed tax calculator](https://gigmytax.com/calculators/illinois-self-employed-tax).

The three taxes on Illinois self-employment income

(1) Federal income tax at 10–37% marginal. (2) Self-employment tax at 15.3% on 92.35% of net profit. (3) Illinois state income tax at a flat 4.95% on net taxable income.

Illinois flat rate — the simple math

Take your federal AGI, subtract the Illinois personal exemption (~$2,775 per person for 2026 estimates), and multiply by 4.95%. There are no brackets to memorize.

Personal Property Replacement Tax (PPRT)

Partnerships, S-corps, and trusts owe an additional 1.5% PPRT on Illinois net income. Sole proprietors and single-member LLCs treated as disregarded entities do NOT owe PPRT.

Illinois quarterly estimated tax

IL uses the federal 4/15, 6/15, 9/15, 1/15 schedule. File Form IL-1040-ES. Required if you will owe $1,000+ in IL tax for the year. Underpayment penalty is charged at IRS-plus-1% rate.

Chicago-specific taxes

Chicago does NOT have a city income tax on residents. However, some services owe the Chicago Personal Property Lease Transaction Tax (9%) if you rent equipment, and the Netflix-style Amusement Tax applies to streaming/entertainment services you sell.

Deductions that reduce state AND federal

Business mileage at $0.70/mi, home office, phone %, self-employed health insurance, and Solo 401(k) all lower both federal AGI and Illinois taxable income. See our [1099 deductions checklist](https://gigmytax.com/blog/1099-deductions-checklist).

Worked example: $70k Illinois freelancer

$70k gross − $6k expenses = $64k net. SE tax ≈ $9,046. Federal (single, standard, ½ SE) ≈ $7,700. IL state (4.95% on ~$59k taxable) ≈ $2,920. Total ≈ $19,666 (~28% of gross). Verify: [Illinois calculator](https://gigmytax.com/calculators/illinois-self-employed-tax).

Set-aside for Illinois freelancers

Rule of thumb: 28–30% of every 1099 payout. Use our [set-aside calculator](https://gigmytax.com/calculators/tax-savings-percentage) for your exact number.

Bottom line

Illinois is mid-pack for self-employment tax — friendlier than NY or CA, more expensive than TX or FL. The flat 4.95% rate makes planning easy.

Frequently asked questions

+What is the Illinois self-employment tax rate?

Illinois charges a flat 4.95% state income tax on self-employment profit. On top of that, federal income tax and 15.3% federal SE tax still apply.

+Do Illinois freelancers pay Personal Property Replacement Tax?

Only partnerships, S-corps, and trusts owe PPRT (1.5%). Sole proprietors and disregarded single-member LLCs do not.

+Does Chicago have a city income tax?

No. Chicago has no personal income tax on residents. Certain business transaction taxes (leases, amusements) may still apply depending on your services.

+Do I have to pay IL quarterly estimated tax?

Yes if you will owe $1,000+ in Illinois tax for the year. File Form IL-1040-ES on the federal quarterly schedule.

+How much tax do self-employed Illinoisans pay?

Typically 26–34% of net profit — 15.3% SE + federal 10–24% marginal + IL flat 4.95%.