Interest rates are compensation for the time-value of money, and are calculated on judgments (the amount of money one party to a lawsuit is ordered to pay another party) based on the applicable state or federal statutes. There are often different interest rates set by law for prejudgment interest (the interest on the amount owed before the judgment) and post-judgment interest (the interest on the amount owed after the judgment). The calculation of prejudgment and post-judgment interest rates vary from state to state (and in federal court), and require a careful analysis of the statutes.

In Illinois, interest rates on judgments are governed by state statutes, which set forth the rates for both prejudgment and post-judgment interest. Prejudgment interest is designed to compensate a plaintiff for the loss of use of money due to the defendant's wrongful conduct from the time of the injury or breach until the judgment is made. Illinois law typically allows for prejudgment interest in certain types of cases, such as personal injury and wrongful death, and the rate is set by statute. Post-judgment interest, on the other hand, is interest that accrues on the amount of the judgment from the time the judgment is entered by the court until the judgment is paid. In Illinois, the post-judgment interest rate is also established by statute and is calculated from the date of the judgment until the judgment is satisfied. The specific rates and conditions under which interest is calculated can be found in the Illinois Compiled Statutes and may be updated periodically. It is important for parties involved in litigation to consult the current statutes or an attorney to understand the applicable interest rates for their particular case.