HSA Tax Benefits in Illinois (2026)
Illinois follows federal HSA tax treatment with full state benefits.
State Income Tax
4.95%
HSA Deduction
Yes
Growth Tax-Free
Yes
How Illinois Treats HSAs
Illinois conforms to federal HSA tax treatment. Contributions reduce your Illinois taxable income, earnings grow tax-free, and qualified medical expense withdrawals are not subject to state tax.
Illinois HSA FAQs
Are HSA contributions tax-deductible in Illinois?
Yes. Illinois follows federal HSA tax treatment, so contributions are deductible on your state income tax return.
What is the state income tax rate in Illinois?
Illinois's state income tax rate is 4.95%.
Is HSA investment growth taxed in Illinois?
No. Illinois follows federal treatment — investment growth inside your HSA is not subject to state income tax.
This information is for general guidance only and does not constitute tax advice. State tax laws change frequently. Consult a tax professional for advice specific to your situation.
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