Run payroll with Illinois-specific details in view — including state income tax withholding, unemployment insurance contributions, new-hire reporting, minimum wage requirements, federal payroll taxes, and Illinois wage-payment timing. PayDay brings the workflow together so payroll is easier to manage as your team grows.
Illinois uses a flat 4.95% individual income tax rate, and employers generally withhold Illinois income tax from covered employee wages.
Illinois employers can have state withholding, unemployment insurance, wage-payment, new-hire reporting, and minimum-wage obligations in addition to federal payroll responsibilities. A reliable payroll process should keep each requirement tied to the correct employee, pay period, tax account, filing schedule, and work location.
Illinois payroll can involve state income tax withholding, unemployment insurance contributions, and the usual federal employment taxes.
For 2026, Illinois unemployment insurance contributions apply to the first $14,250 of wages paid to each worker. Most newly liable employers use a 3.350% entry rate, while experience-rated employer rates range from 0.750% to 7.050%. The 2026 rates include a 0.550% Fund Building Rate.
Illinois UI ratesIllinois has a flat 4.95% individual income tax rate. Employers generally withhold Illinois income tax from covered wages using Form IL-W-4 and the state’s 2026 withholding methods and tables.
2026 withholding tablesIllinois employers also manage federal income tax withholding, Social Security and Medicare taxes, and federal unemployment tax where applicable. Deposit and filing schedules depend on federal rules and your payroll tax profile.
Federal tax overviewNeed the official Illinois employer guidance for withholding tax forms, payment schedules, payroll tables, and filing requirements?
Open Illinois payroll tax formsFour state-specific details worth building into your payroll process right now.
Illinois guarantees a $15.00 hourly minimum wage for workers age 18 and older. The state lists a $9.00 tipped minimum cash wage and a $13.00 youth rate for qualifying workers under 18 who work fewer than 650 hours in a calendar year.
Illinois employers must report new employees to the state New Hire Directory within 20 days of the employee’s first day on payroll, with required employee and employer information.
For calendar year 2026, Illinois unemployment insurance contributions apply only to the first $14,250 of wages paid to each covered worker.
Most Illinois employees must be paid at least semimonthly, with wages generally due no later than 13 days after the pay period ends. Certain executive, administrative, professional employees and commissions may be paid monthly.
Payday timing matters: Illinois generally requires earned wages to be paid at least semimonthly and no later than 13 days after the end of the pay period in which they were earned. Executive, administrative, and professional employees as defined under the FLSA may be paid monthly, and commissions may also be paid monthly.
Keep the day-to-day payroll work in one organized system, from employee data to calculations, deductions, records, and growing teams.
Keep employee details, compensation information, job data, and payroll history together instead of spreading records across disconnected files.
Calculate gross pay, overtime, bonuses, taxes, deductions, and net pay with repeatable payroll workflows that reduce manual work.
Support hourly, salaried, overtime, shift-based, commission, and other compensation structures across different employees and teams.
Track taxes, benefits, retirement deductions, garnishments, loans, and other payroll deductions with a clearer audit trail.
Keep payroll registers, employee pay history, deduction details, and reporting data organized so review and reconciliation are easier.
Add employees, locations, departments, and payroll structures as your Illinois business expands without rebuilding your process each time.
Whether your team works from one location or across several Illinois markets, centralized payroll records help you keep employee data, pay settings, departments, and locations organized in one place.
A simple workflow helps your team move from employee setup to payroll review and final processing with fewer handoffs.
Add employee information, pay type, compensation, work location, deductions, and the payroll details your process needs.
Review hours, earnings, Illinois and federal tax treatment, deductions, adjustments, and totals before finalizing the payroll cycle.
Keep payroll history, employee records, reporting details, and recurring schedules together for the next payroll run.
Illinois generally requires employers to pay all earned wages at least semimonthly. Wages are generally due no later than 13 days after the end of the pay period in which they were earned. Executive, administrative, and professional employees as defined under the Fair Labor Standards Act may be paid once per month, and commissions may also be paid monthly. That makes payroll cutoffs, approvals, banking timing, employee classifications, and documented paydays important parts of the process.
Hiring an employee outside Illinois can create payroll obligations in the state where that employee works. You may need additional employer registration, different state income tax withholding, unemployment coverage, local taxes, leave programs, or different payday rules depending on the work location. Multi-state payroll works best when each employee’s work state is recorded clearly and payroll settings are reviewed before the first paycheck.
Use location-based employee settings and a documented state setup process so Illinois rules are not accidentally applied to an employee working in another state.
Explore Multi-State PayrollGive payroll teams a cleaner workflow for employee data, recurring payroll tasks, and day-to-day workforce administration.
Bring employee setup, payroll processing, deductions, records, and review steps into a straightforward payroll process.
Support more employees, departments, pay types, and locations without relying on a maze of manual spreadsheets.
Keep payroll information, employee records, reports, and recurring admin work connected in one business system.
Use official resources to confirm Illinois-specific payroll obligations and stay current as withholding tables, wage bases, contribution rates, or labor rules change.
Official Illinois Department of Revenue payroll withholding resources, including the 2026 IL-700-T tables, IL-941, IL-501, and employer guidance.
Official Illinois Department of Labor resources covering minimum wage, wage payment and collection, overtime, and related employer responsibilities.
See how PayDay can help your team organize employee payroll, calculations, deductions, records, pay schedules, state withholding, and multi-location workflows in one connected process.
Start with PayDayThis page provides general payroll information and is not legal, tax, or accounting advice. Rules, rates, filing requirements, and agency guidance can change. Verify current requirements with the Illinois Department of Revenue, the Illinois Department of Employment Security, the Illinois Department of Labor, the IRS, and other agencies that apply to your business.
Last reviewed: August 31, 2026