Illinois Schedule IL-E/EITC – Exemption & Earned Income Tax Credit (2026)
Last reviewed: 2025-11-07
Use the Illinois Tax Form Calculator Form IL-1040 Schedule IL-E/EITC: Earned Income Credit as a stand alone tax form calculator to quickly calculate specific amounts for your 2026 Illinois state tax return. Alternatively, you can use one of our Combined Federal and State Tax Estimators to quickly calculate your salary, tax, and take-home pay.
Schedule IL-E/EITC is used to claim your Illinois dependent exemption, the Illinois Earned Income Tax Credit (IL-EITC), and, if eligible, the Illinois Child Tax Credit. For 2026, the IL-EITC equals 20% of your Federal EITC, subject to Illinois maximums based on the number of qualifying children. If you have at least one dependent under age 12, Illinois also allows a Child Tax Credit equal to 20% of your IL-EITC.
Who Should Use This Schedule
Complete Schedule IL-E/EITC if you claim dependents on IL-1040, want to claim IL-EITC based on your Federal EITC, or may qualify for the Illinois Child Tax Credit. This schedule commonly appears alongside Schedule ICR (Illinois Credits) and Schedule M (Additions & Subtractions).
How the Illinois Credits Work
Dependent Exemption: Multiply your dependent count by $2,775 to compute your Illinois dependent exemption. This amount reduces Illinois base income when carried to IL-1040.
IL-EITC: Take your Federal EITC and multiply by 20% to get the preliminary IL-EITC, then apply the Illinois maximum based on qualifying children (0: $126, 1: $843, 2: $1,392, 3+: $1,566). Your IL-EITC is the smaller of the two.
Illinois Child Tax Credit: If you have at least one dependent under age 12, multiply your final IL-EITC by 20% to compute the Child Tax Credit. Confirm eligibility on IL-1040 instructions.
| Step 1 – Dependent Exemption | ||
| 1 | Number of dependents claimed | |
| 2 | Dependent exemption (Line 1 × $2,775) | |
| Step 2 – Federal Earned Income Tax Credit | ||
| 3 | Federal EITC amount (from your Federal Form 1040) | |
| Step 3 – Illinois Earned Income Tax Credit | ||
| 4 | Preliminary IL-EITC (Federal EITC × 20% ) | |
| 5 | Illinois maximum based on qualifying children (0/1/2/3+) | |
| 6 | IL-EITC (smaller of Line 4 or Line 5) | |
| Step 4 – Illinois Child Tax Credit (if eligible) | ||
| 7 | Any dependent under age 12? | |
| 8 | Illinois Child Tax Credit (Line 6 × 20% if Line 7 checked) | |
| Step 5 – Total Credits to IL-1040 | ||
| 9 | Total to carry to IL-1040 credits (IL-EITC + IL Child Tax Credit) | |
Examples
Example 1 (1 child): Federal EITC=$4,000 ⇒ IL preliminary=$4,000 × 20% = $800. Illinois maximum with 1 child is $843, so IL-EITC=$800. If a dependent is under 12, IL Child Tax Credit=$800 × 20% = $160. Total credits=$960.
Example 2 (3+ children): Federal EITC=$8,000 ⇒ IL preliminary=$1,600. Max for 3+ children is $1,566, so IL-EITC=$1,566. If eligible for Child Tax Credit: $1,566 × 20% = $313.
Filing Tips
- Retain Federal return pages showing your Federal EITC and dependent details.
- Ensure your dependent count and under-12 status match your IL-1040 entries.
- Carry totals correctly to IL-1040 Lines for dependents and credits to avoid delays.
Last reviewed: 2025-11-07: If you believe this form requires an update, please contact us.
Related Forms
- Form IL-1040 – Individual Income Tax Return
- Schedule ICR – Illinois Credits
- Schedule M – Additions & Subtractions
Quick Access Tools
Frequently Asked Questions
Will IL tax my Roth conversions?
Conversions are taxable federally and typically flow to IL; IL retirement exclusion usually applies to distributions, not conversions—check IL guidance.
How do I amend my Illinois return?
File Form IL-1040-X after your original IL-1040 is processed; include revised schedules (e.g., Schedule ICR/CR/M) and explanations.
Why does Illinois distinguish pre-1969 and post-1969 gains?
Because Illinois enacted its income tax on August 1, 1969, any appreciation before that date occurred before the state had authority to tax income. Form IL-F preserves fairness by taxing only the gain realized since Illinois income tax law took effect. This approach avoids retroactive taxation while ensuring current gains are taxed appropriately.
When should Schedule FD be filed?
File Schedule FD with your annual IL-1040 return for the tax year in which the deferred income became federally taxable.
Why is Schedule M important for accurate Illinois taxes?
Illinois uses Schedule M to ensure fairness in applying its flat 4.95% tax rate. Because Illinois starts from federal AGI, this form ensures only Illinois-approved income is taxed and proper deductions are applied. It’s especially vital for retirees, military personnel, and taxpayers with multistate investments.
Important Notes
All calculations are estimates for guidance only. Always review your return and consider professional advice when submitting official filings.