Chicago and Illinois Trust Planning Guide
Estate tax, probate, property-tax, Medicaid recovery, and home-title checkpoints for Chicago and Illinois families.
Quick tax summary for 2026
| Issue | Illinois / Chicago checkpoint |
|---|---|
| Federal estate tax | IRS filing threshold for 2026 deaths is $15,000,000. |
| Illinois estate tax | Illinois exclusion amount is $4,000,000. The Attorney General says it is a taxable threshold, not a credit. |
| Illinois inheritance tax | Illinois does not have a separate inheritance tax in the same way some states do; the key state issue is estate tax. |
| Cook County property-tax exemptions | Homeowner, senior, senior freeze, longtime homeowner, home improvement, returning veteran, disabled veteran, and disabled person exemptions may be available. |
| Medicaid estate recovery | Illinois HFS says recovery relates to probate estate property, with debts and costs paid before a recovery claim. |
Why this matters for Chicago families
A Chicago home, life insurance, retirement accounts, and small business value can push a family closer to the Illinois estate tax threshold even when the family is nowhere near federal estate tax. Illinois is the highest-priority tax jurisdiction in the current Black Legacy Kit launch states.
Practical planning moves
- Inventory the home, retirement accounts, life insurance, business interests, and real estate.
- If total family wealth may approach $4 million, ask an Illinois estate-planning attorney about Illinois estate tax planning.
- Married couples should ask about whether the Illinois exemption is being preserved; federal portability does not solve every Illinois issue.
- Keep Cook County property-tax exemptions on the annual review checklist.
- If a parent received Medicaid long-term care, include Illinois estate recovery in the attorney intake packet.
- If property has multiple informal family owners, add an heirs' property / title review task.
Values to show in the app
- Federal estate tax filing threshold for 2026 deaths: $15,000,000.
- Illinois estate tax threshold: $4,000,000.
- Example from Illinois Attorney General fact sheet: a $5,000,000 Illinois estate can show $285,714 Illinois estate tax in the provided computation example.
Source notes
- IRS estate tax filing thresholds: https://www.irs.gov/businesses/small-businesses-self-employed/estate-tax
- Illinois Attorney General estate tax fact sheet: https://www.illinoisattorneygeneral.gov/Page-Attachments/EstateTaxInstructionFactSheet.pdf
- Illinois Attorney General estate tax page: https://www.illinoisattorneygeneral.gov/estate-taxes/
- Cook County property tax exemptions: https://www.cookcountyil.gov/service/property-tax-exemptions
- Illinois Medicaid estate recovery guide: https://hfs.illinois.gov/medicalclients/medicaidestaterecovery/guidetothemedicaidestaterecoveryprogram.html
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