On July 5, 2023, Illinois updated its withholding formula, lowering the state allowance from its 2023 level of $2,625 to $2,425.
To correct the withholding for existing employees for the remainder of 2023, a “catch-up” formula was also issued with a value of $2,225.
Provisions for the allowance value in Public Act 103-0009 took effect upon the bill’s signing. The bill will continue to provide adjustments each year for the allowance value.
For more information on Illinois' wage and payroll tax laws, check out our Illinois Wage and Payroll Tax Facts page.
Thank you for choosing Paylocity as your Payroll Tax and HCM partner. This information is provided as a courtesy, may change, and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.
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