Illinois restored the cost-of-living increase for its standard personal income tax exemption. The cost-of-living increase was set to expire after the 2017 tax year. The restored increase expires after 2023.
How Much Is the Standard Exemption?
Illinois provides a standard exemption of $2,050 for each taxpayer. It adjusted this amount every year by any increase in the cost-of-living. Thus, the standard exemption increased from $2,150 for the 2015 tax year to $2,175 for the 2016.
The exemption did not increase from the 2016 to 2017 tax year.
How Does Illinois Calculate the Increase?
The cost-of-living increase equals the standard amount of $2,050 times the percentage by which:
- the Consumer Price Index for the previous calendar year exceeds
- the Consumer Price Index for the 2011 calendar year.
P.A. 100-865 (S.B. 1437), Laws 2018, effective August 14, 2018