Updated October 24, 2026. Quick answer: Line 37 of the 2025 Illinois Schedule M covers railroad pay. The instructions say “Enter the amount of any railroad sick pay and railroad unemployment compensation that is included in your Form IL-1040, Line 1.” They add “Do not include retirement or third party sick pay on this line.”
What this line asks
The form prints the label as “Railroad sick pay and railroad unemployment income.” The instructions open with “Enter the amount of any railroad sick pay and railroad unemployment compensation that is included in your Form IL-1040, Line 1.”
The general question and answer at the start of the booklet explains why this line exists: “Unemployment compensation included in your federal adjusted gross income, except railroad unemployment, is fully taxable to Illinois.” For other retirement income on this return, see Illinois retirement taxes, whether Illinois taxes pensions and the IL-1040 line 5 retirement income subtraction.
Who it applies to
The condition is printed in the instruction itself: the pay must be “included in your Form IL-1040, Line 1.” The booklet’s note then limits the line: “Do not include retirement or third party sick pay on this line.” Military pay has its own line and its own page, see whether Illinois taxes military retirement.
What the instructions say to enter
| Step | What the instructions say |
|---|---|
| What to enter | “Enter the amount of any railroad sick pay and railroad unemployment compensation that is included in your Form IL-1040, Line 1.” |
| What not to enter | “Do not include retirement or third party sick pay on this line.” |
| Attach | “Attach: Form 1099-G or Form W-2 showing railroad sick pay or railroad unemployment compensation and a copy of page 1 of your federal return and Schedule 1.” |
Where the result goes next
Line 37 is on the page that begins with line 33 and ends with “Add Lines 33 through 41. Enter the amount here and on Form IL-1040, Line 7.” See the Illinois IL-1040 line by line guide for line 7 itself.
Edition and line numbers
This page reads the 2025 Schedule M Instructions (IL-1040) and the 2025 Schedule M form from the Illinois Department of Revenue, the current file served on 2026-10-24. Check the edition printed on your own form and use that edition’s line numbers.
Common mistakes
- Entering railroad retirement or third party sick pay. The instructions say “Do not include retirement or third party sick pay on this line.”
- Treating ordinary unemployment as railroad unemployment. The instructions say “Unemployment compensation included in your federal adjusted gross income, except railroad unemployment, is fully taxable to Illinois.”
- Sending the return without the statement. The instructions say “Attach: Form 1099-G or Form W-2 showing railroad sick pay or railroad unemployment compensation and a copy of page 1 of your federal return and Schedule 1.”
Related: Illinois retirement taxes, whether Illinois taxes pensions, the IL-1040 line 5 retirement income subtraction, and whether Illinois taxes military retirement.
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Answer againSources
- 2025 Schedule M Instructions (Other Additions and Subtractions for Individuals), Illinois Department of Revenue: tax.illinois.gov
- 2025 Schedule M Other Additions and Subtractions for Individuals, Illinois Department of Revenue: tax.illinois.gov
Read from the state revenue documents linked above on October 24, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the state revenue department is the right place to confirm anything consequential.