Live in Illinois, work in Iowa
A full-year Illinois resident’s covered employee wages earned in Iowa are subject to Illinois income tax under the Iowa–Illinois reciprocal agreement, not Iowa income tax. Other Iowa-source income and local income taxes need separate checks.
Choose your next step
Payroll starting point: Iowa Form 44-016: employee nonresidence statement (opens in new tab). Give your Iowa employer the signed Iowa 44-016 to claim the wage withholding exemption. Arrange Illinois withholding or check Illinois estimated payments, and inspect pay statements for Iowa withholding.
Official tax guidance for both states
Check withholding, filing requirements and current forms with each state's tax agency.
- Illinois: Illinois Department of Revenue - Businesses (opens in new tab)
- Iowa: Iowa Department of Revenue (opens in new tab)
Agency directory checked 2026-10-01 against the IRS state-government directory. This verifies the agency links, not an individual tax result. Use forms for the year you are filing.
Before you use this estimate
This model assumes a full-year resident of Illinois, ordinary employee wages and all workdays physically in Iowa. Check exemption eligibility before treating a work-state amount of $0 as your own result. Withholding is a prepayment, not final tax liability. Other income, a move during the year, remote work and separate local taxes or credits can change the result.
Wage-exemption conditions: IL residents working in IA exempt from IA tax on wages; file IA Form 44-016 (Employee Nonresidence Certificate).
State income tax: $4,805 a year
Modeled annual state income tax for living in Illinois and working in Iowa: about $4,805 on $100,000 of wages.
Reciprocity agreement: covered employee wages are subject to state income tax only in your home state. Give your employer the work state's exemption form and arrange home-state withholding. County and city taxes require a separate check.
Conditions for this pair: IL residents working in IA exempt from IA tax on wages; file IA Form 44-016 (Employee Nonresidence Certificate).
Tax guide and official sources: live in Illinois, work in Iowa
Official agency starting points: Illinois tax agency (opens in new tab) · Iowa tax agency (opens in new tab). These directory links identify the selected states' agencies, not your filing obligations. Check their individual-tax guidance and forms for the year you are filing.
This is the usual filing pattern, not a determination that you must file. Filing thresholds, age or dependent status, other income and withholding refunds can change which returns you need.
How this $100,000 estimate adds up
These steps follow the selected home, work state, salary and filing status. They reconcile the model's annual liability, not the amounts withheld from your paycheck.
| Step | Iowa work state | Illinois home state |
|---|---|---|
| Tax before the modeled other-state credit | $0 | $4,805 |
| Modeled other-state credit subtracted | $0 | $0 |
| Tax after that credit | $0 | $4,805 |
Total: $0 + $4,805 = $4,805 a year. Amounts are rounded for display. Work-state wage exemptions, when applicable, are already reflected in the first row; they are not an other-state credit.
No other-state credit is subtracted in this selected scenario. Included county components stay in these amounts; excluded local taxes and credits stay excluded. Federal income tax, payroll programs and refund eligibility are outside this reconciliation.
State tax at different salaries
| Wages | To IA | To IL | Modeled total | If you worked in IL |
|---|---|---|---|---|
| $50,000 | $0 | $2,330 | $2,330 | $2,330 |
| $75,000 | $0 | $3,568 | $3,568 | $3,568 |
| $100,000 | $0 | $4,805 | $4,805 | $4,805 |
| $150,000 | $0 | $7,280 | $7,280 | $7,280 |
| $250,000 | $0 | $12,230 | $12,230 | $12,230 |
Single filer, all wages earned in Iowa, 2026 state tax rules, standard deductions. Local income taxes not included.
From paycheck withholding to your returns
- Withholding: Complete Iowa 44-016, Employee’s Statement of Nonresidence in Iowa, and give it to your Iowa employer, who keeps it on file. The linked form is dated October 3, 2024; Iowa’s reciprocity page still names it. Notify the employer within 10 days of a residence change. Ask whether payroll can withhold Illinois tax; otherwise check Illinois estimated payments.
- Returns: Illinois instructions direct an Illinois resident working in Iowa to file IL-1040 and include this compensation. If Iowa income tax was withheld on reciprocal wages, seek a refund from Iowa, not an Illinois credit for withholding. Iowa’s 2025 instructions describe IA 1040 and IA 126 for this refund, with W-2s, a copy of the complete federal return and other applicable state returns. Consult the actual filing-year instructions for 2026 wages. Other Iowa income or a change of residence may alter the return.
- Credit or refund: For covered wages, recover Iowa withholding through the Iowa refund process; withholding alone is not an Illinois credit for tax owed to Iowa. Illinois Schedule CR may cover eligible other-state or local income taxes on the same income, subject to its conditions, documentation and limit; check the relevant year and do not assume a local credit.
Worked example: $100,000 of wages
Single filer, full-year resident of Illinois, all work performed in Iowa, no other income, standard deductions and modeled personal exemptions. Covered wages are exempt from Iowa state income tax under wage reciprocity. Pay a modeled $4,805 to Illinois, total $4,805. This exemption is not an other-state tax credit.
Annual liability, not paycheck withholding or a refund estimate. Federal tax, payroll programs, other local taxes, special credits and part-year residency are excluded. Local income taxes not included.
Remote-work and local exceptions
Full-year Illinois resident, ordinary employee W-2 wages and all workdays physically in Iowa. Self-employment and other Iowa-source income are not covered by this wage example; a part-year move or hybrid workdays need separate sourcing and filing checks.
Rock Island home, Davenport workplace: match the state withholding
For a full-year Illinois resident working in Davenport, compare the Iowa and Illinois W-2 state entries with the signed Iowa 44-016. If Iowa withheld state tax on covered wages, collect the federal and Illinois returns and withholding evidence for the Iowa refund procedure. Iowa rental or business income requires a separate filing check even when the employee wages qualify. This example calculates no local tax or refund amount.
Official forms and instructions
- Iowa 44-016 nonresidence statement (10/03/2024 edition) (opens in new tab)
- Iowa–Illinois reciprocal agreement (opens in new tab)
- Iowa 2025 expanded filing instructions, including Illinois reciprocal refund (opens in new tab)
- Illinois resident filing and reciprocal-state refund instructions (opens in new tab)
- Illinois Schedule CR instructions (2025 edition) (opens in new tab)
- Illinois withholding and estimated payment options (opens in new tab)
Source audit 2026-11-02. Use the return and instructions for the year you are filing; a current-forms link may still show a prior-year return. Official sources checked; not independently reviewed.
Check your payslip and keep these records
- Compare the payroll certificate you supplied with the state withholding on your next payslip. Check city, county and school-district entries separately; a state exemption does not settle local tax.
- Keep your W-2 and other withholding statements, copies of payroll certificates, filed state and local returns, and proof of tax paid. A refund depends on actual withholding and the completed return, not this annual estimate.
- Keep an actual work-location log, including home-working days. This calculator assumes ordinary employee wages, full-year residence in Illinois and every workday physically in Iowa.
- If you moved during the year, have nonwage income or do not meet that scope, follow the pair's remote and local exceptions and the moving-year tax guide before using the amount as your own result. This tool does not calculate hybrid allocation, local credits or a personal refund.
What to do
- Keep a record of the days you work in each state, especially if you sometimes work from home.
Local income taxes
- Iowa: School district income surtax on residents only (percentage of state tax); does not affect nonresident commuters.
Frequently asked questions
Do I pay Iowa income tax if I live in Illinois?
If you qualify for the wage-reciprocity exemption, no Iowa state income tax on covered employee wages: under reciprocity Illinois taxes them. City and county taxes require a separate check. IL residents working in IA exempt from IA tax on wages; file IA Form 44-016 (Employee Nonresidence Certificate).
Do I have to file taxes in both Illinois and Iowa?
Illinois instructions direct an Illinois resident working in Iowa to file IL-1040 and include this compensation. If Iowa income tax was withheld on reciprocal wages, seek a refund from Iowa, not an Illinois credit for withholding. Iowa’s 2025 instructions describe IA 1040 and IA 126 for this refund, with W-2s, a copy of the complete federal return and other applicable state returns. Consult the actual filing-year instructions for 2026 wages. Other Iowa income or a change of residence may alter the return.
Will I be taxed twice?
Not at the state level on covered wages: under reciprocity Illinois taxes them, about $4,805 on $100,000 in this model. The estimate includes resident county tax where modeled; other local taxes or credits are separate.
Related
- Live in Iowa, work in Illinois
- Moving from Illinois to Iowa
- Moving from Iowa to Illinois
- Live in Illinois, work in Indiana
- Live in Illinois, work in Kentucky
- Live in Illinois, work in Missouri
- Live in Illinois, work in Wisconsin
Rules reviewed 2026-09-24 from state revenue departments and the Tax Foundation. Estimates only; confirm with each state's revenue department.