A tax is a charge or levy of money made by a governmental entity (state, local, or federal) against a taxpayer—usually a U.S. citizen or a person living or working in the United States. There are many kinds of taxes, including income tax, capital-gains tax, property tax, franchise tax, gift tax, ad valorem tax, sales tax, use tax, inheritance tax, and estate tax.

In Illinois, as in other states, taxpayers are subject to various types of taxes imposed by state, local, and federal governments. The state imposes an income tax on individuals, trusts, and corporations. Illinois has a flat-rate income tax system for individuals, meaning that all taxpayers are taxed at the same rate, regardless of income level. Capital gains are taxed as income at the state level. Property taxes are primarily administered by local governments and are one of the major sources of revenue for municipalities and counties, funding services such as education and public safety. Illinois does not have its own estate or inheritance tax, but residents are subject to federal estate taxes if their estate exceeds the federal exemption limit. Sales tax in Illinois is a combination of state, county, and city taxes, and the state also imposes a use tax on the privilege of using, in Illinois, tangible personal property that is purchased out of state. Gift tax is not imposed by the state of Illinois but is a consideration under federal tax law. Franchise taxes are levied on corporations for the privilege of doing business in the state. Ad valorem taxes, which are based on the value of property, are commonly applied to real estate property tax bills.