1099 Contractor in Illinois with a Texas Client: Where Do You File?
Answer
Only Illinois taxes you, and nobody withholds. Texas levies no personal income tax, so a Texas client creates no Texas obligation whatever. You make quarterly estimated payments to Illinois on the profit and report it on a Illinois resident return.
Last verified
Self-employment income from personal services is sourced to the place where the services are performed. You perform them in Illinois; Texas would have no claim even if it levied an income tax, which it does not.
What you file
- 1Quarterly estimated payments · Illinois
Make quarterly estimated payments to Illinois Department of Revenue — nothing is withheld from a 1099.
- 2Resident return · Illinois
File a Illinois resident return reporting your full self-employment income.
The two states, side by side
| Illinois | Texas | |
|---|---|---|
| Taxes wages | Yes — flat | No |
| Reciprocity partners | 4 (Form IL-W-5-NR) | None |
| Convenience rule | No | No |
| Nonresident return | Form IL-1040 with Schedule NR | Not applicable |
| Credit for other-state tax | Schedule CR | No income tax |
| Nonresident safe harbour | 30 days | Not applicable |
| Local income tax | No | No |
| Revenue department | Illinois Department of Revenue | Texas Comptroller of Public Accounts |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Texas and working in Illinois gives:Client state only, if you work there.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Illinois → TexasHome state only
- Remote worker: Illinois → TexasHome state only
- Moved mid-year: Illinois → TexasOne part-year return — the state you left
Other Illinois pairs
Questions people actually ask
I live in Illinois and my client is in Texas. Do I have to file a Texas tax return?
Only Illinois taxes you, and nobody withholds. Texas levies no personal income tax, so a Texas client creates no Texas obligation whatever. You make quarterly estimated payments to Illinois on the profit and report it on a Illinois resident return.
Do reciprocity agreements help a 1099 contractor?
No. Every state reciprocity agreement in the country is an arrangement about wage withholding between two revenue departments, and a 1099 has no withholding to switch off. Whether Illinois and Texas hold an agreement makes no difference to a self-employed filer — sourcing rules decide the answer instead.
How current is this?
The Illinois and Texas rules on this page were last checked against Illinois Department of Revenue and Texas Comptroller of Public Accounts on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Illinois Department of Revenue — individual income taxaccessed 2026-08-07
- Texas Comptroller of Public Accounts — individual income taxaccessed 2026-08-07