Illinois to Tennessee Retirement Taxes (2026): Every Tax That Changes

Updated July 25, 2026. Quick answer (2026): Moving from Illinois to Tennessee in retirement, the income-tax saving is zero — both states already leave retirement withdrawals alone. The money is at death. Four separate taxes change when you move — state income tax on withdrawals, state estate tax, state inheritance tax, and what probate costs your heirs. Most comparisons only price the first one.

Comparing other moves: Michigan to Tennessee retirement taxes, Minnesota to Tennessee retirement taxes and Oregon to Tennessee retirement taxes.

Illinois vs Tennessee: every tax that changes

Every cell is quoted from our statute-cited 51-jurisdiction dataset. Download the full dataset as CSV.

1. What changes on your annual tax bill

Nothing. Illinois already leaves retirement withdrawals untaxed: Not taxed: the federally taxed portion of income from qualified employee benefit plans and government plans is subtracted — qualified employer plans (401(k), 403(b), and state or local government 457 plans), traditional IRA distributions (including Roth conversions), pensions from qualified employee benefit plans and government pensions, railroad retirement. Income from deferred compensation plans that are not government plans, third-party sick pay, and lump sums taxed under the 10-year averaging method does not qualify. Tennessee does not tax them either. If you are moving for the income-tax saving alone, there is no saving to collect — and that is the single most common mistake in Illinois relocation math.

2. What changes at death: state estate tax

This is usually the larger number. Illinois levies an estate tax — yes – $4,000,000 exclusion (not indexed, a taxable threshold and not a credit against tax; above it the Attorney General computes the tax with an interrelated calculation built on the federal state death tax credit as in effect on December 31, 2001. The Attorney General’s examples show $0 on a $4,000,000 estate and $285,714 on a $5,000,000 estate that is all in Illinois, about 28.6% of the amount over $4,000,000); administered by the IL Attorney General — and Tennessee levies none (none (the inheritance tax ended for deaths in 2016 or later)). Establishing domicile in Tennessee removes that exposure for assets that are not Illinois real property.

3. What changes at death: state inheritance tax

Neither state levies an inheritance tax. Illinois: none Tennessee: none

4. The one nobody prices: what probate costs your heirs

Illinois uses a reasonable-fee fee model (Reasonable compensation for representatives (755 ILCS 5/27-1) and attorneys (755 ILCS 5/27-2); no percentage schedule.); Tennessee uses a reasonable-fee model (No statutory percentage; personal representative and attorney compensation is reasonable compensation for services, approved by the probate court (see Tenn. Code Ann. §30-1-407 and related case law). Cite from knowledge, not re-verified this pass.). Filing fees — Illinois: varies by county Tennessee: Set per county clerk under Tenn. Code Ann. §8-21-401. Published 2026 schedules list $334.50 in Davidson County, $354.50 in Hickman County and $389.50 in Hamilton and Knox counties; Blount County’s March 2025 schedule lists $300.00.

Full detail: probate cost by state and small-estate limits by state.

Does this actually apply to you?

Below $1,000,000 no US state estate tax applies anywhere — Oregon has the lowest threshold in the country and that is where it starts. So for most estates the whole “escape the death tax” framing is irrelevant, and the only thing that changes when you move is your annual income tax. Here is exactly where the line falls for this pair:

Thresholds are the 2026 figures in our verified dataset and apply to the taxable estate. Federal estate tax is separate and far higher. Test your own number with the comparison tool.

Probate cost in each state, specifically

Illinois uses a “reasonable fee” standard with no schedule, and its small-estate route does not clear a solely owned house. Tennessee uses a “reasonable fee” standard with no schedule, and its small-estate route does not clear a solely owned house. Both states land in the same bucket on that question. Full figures with the governing statute, the court filing fee and the small-estate threshold: Illinois probate cost and Tennessee probate cost.

Four taxes, two states, one order of operations

Everything above changes together: what Illinois stops taking on withdrawals, what Tennessee does not take at death, and what probate costs in each. The order you do things in — when you establish domicile, when you convert, when you retitle property — changes the total, and some of it cannot be undone afterwards. If a move is genuinely on the table, here is what to look for in an advisor who knows both Illinois and Tennessee. If you would rather price it yourself first, the two-state comparison tool is free and asks for no email.

Will Illinois still tax me after I move to Tennessee?

Not on your retirement withdrawals, once you genuinely change domicile — but that is a harder test than a change of address, and what you leave behind stays in reach.

• Domicile is a test, not a mailing address. A departing state can and does audit residency. Days present, voter registration, driver’s licence, where your doctors and advisers are, and where you keep what you value all count.
• Real property left behind stays taxable. Keeping a home in Illinois can keep part of the estate within reach of Illinois rules even after you become a Tennessee resident.
• A Roth conversion is taxed where you live in the year you convert. Sequencing a conversion after establishing the new domicile is often worth more than the annual saving — see how all 51 jurisdictions tax Roth conversions.

If you keep a home in Illinois, what happens at death?

Changing domicile moves you. It does not move the house. Illinois levies an estate tax, and it reaches a nonresident decedent’s real property situated there — so a home kept behind after the move stays within Illinois’s reach even once Tennessee is your legal home for every other purpose. For nonresidents the property with Illinois taxable situs is real estate and tangible personal property physically situated in Illinois, including any such property held in trust.

Applies where the entire estate exceeds the $4,000,000 exclusion; tax computed as if resident then apportioned by the Illinois-to-total ratio. The practical consequence is the part most summaries skip: the statute reaches property held in trust, so a revocable trust does not move it out of Illinois. Authority: Illinois Attorney General Form 700 instructions.

This is the exposure that survives a move, and it is the one worth pricing before the move rather than after. The house also stays within that state’s probate jurisdiction, so the estate faces a separate ancillary proceeding there on top of the probate where you live — the ancillary probate calculator prices that second proceeding. Confirm the current figures with the state revenue department or a licensed professional before acting — thresholds move, and the arithmetic depends on the whole estate, not just the house.

Full state detail

Every figure above is summarized. The complete statute-cited breakdown for each state: Illinois retirement taxes and Tennessee retirement taxes. To compare any other pair, start at the retirement tax relocation hub.

Widen the comparison

This page prices one corridor. To see every destination Illinois retirees consider and every origin state moving to Tennessee, start there instead. For any pair not covered, the retirement tax comparison tool runs all 51 jurisdictions, and the probate cost calculator works out what settling the estate costs in each.

Talking this through

Relocation timing, Roth conversion sequencing and estate exposure interact, and the order you do them in changes the total. If you want a second opinion, understand what it should cost first — see our advisor cost guide.

Figures verified against 35 ILCS 5/201 and 5/203, IDOR Publication 120, the Illinois Attorney General estate tax fact sheet, 755 ILCS 5/25-1 with Public Act 104-0346 and the Tennessee Department of Revenue Hall income tax and inheritance tax pages on September 30, 2026; the Tennessee small-estate limit and 45-day wait rest on a county court form, and the Tennessee statute cites (Tenn. Code Ann. §§30-1-407, 30-4-102, 30-4-103 and 67-2-102), the Tennessee filing fee range and the Illinois 755 ILCS 5/27-1 and 27-2 compensation cites were not re-checked.

Primary sources

• 35 ILCS 5/203(a)(2)(F) and (L)
• IDOR Publication 120 (Retirement Income)
• 35 ILCS 405/2(b)
• 35 ILCS 405/3
• former Tenn. Code Ann. § 67-2-102 (Hall tax, repealed)
• 755 ILCS 5/27-1
• 755 ILCS 5/27-2
• 755 ILCS 5/25-1 (P.A. 104-0346)
• Tenn. Code Ann. §30-1-407
• Tenn. Code Ann. §30-4-102
• Tenn. Code Ann. §30-4-103

Methodology: every figure is quoted from Clear Money Guide’s statute-cited 51-jurisdiction datasets, compiled from state statutes, session laws and revenue-department publications and adversarially verified in July 2026. Nothing here is personalized tax or legal advice. Confirm your own facts with a qualified adviser before you move.