Illinois vs Wisconsin Veterans Guide: Comparison 2025
Compare Illinois and Wisconsin for military retirees. Analyze military retirement tax, cost of living, VA healthcare, and Midwest employment opportunities.
Illinois vs Wisconsin Veterans Guide: Comparison 2025
Illinois and Wisconsin represent two significant midwestern states with distinct tax philosophies, diverse employment opportunities, and strong veteran communities. Illinois offers major urban centers while Wisconsin emphasizes affordability. This guide compares these Great Lakes destinations for transitioning veterans.
Military Retirement Tax Treatment
Illinois: Military Retirement Exempt
Illinois provides complete military retirement exemption:
Illinois Military Retirement Benefits:
- Military pension: 100% exempt from state income tax
- VA disability compensation: Exempt
- State income tax rate: 4.95% (flat)
- Effective tax on military retirement: 0%
Tax Example - $45,000 military pension + $20,000 other income:
- Military retirement tax: $0
- Other income tax: $990 (at 4.95%)
- Total state tax: $990
Wisconsin: Military Retirement Not Exempt
Wisconsin taxes military retirement:
Wisconsin Tax Treatment:
- Military pension: Subject to state income tax
- VA disability compensation: Exempt
- State income tax rate: 3.54%-7.65% (progressive)
- Effective tax on military retirement: ~5.5%
Tax Example - $45,000 military pension + $20,000 other income:
- Military pension tax: $2,475 (at 5.5%)
- Other income tax: $1,200 (at 6%)
- Total state tax: $3,675
Tax Winner: Illinois (Saves $2,685 annually on military retirement)
Cost of Living Comparison
Housing Market Overview
Illinois Housing:
- Median home price: $265,000
- Property tax rate: 2.27% (high)
- Chicago: $320,000
- Suburbs: $280,000
- Downstate: $180,000
- Property tax on $300,000: $6,810/year
- Rent average: $1,100-$1,500/month
Wisconsin Housing:
- Median home price: $235,000
- Property tax rate: 1.85%
- Milwaukee: $220,000
- Madison: $310,000
- Smaller towns: $180,000
- Property tax on $300,000: $5,550/year
- Rent average: $950-$1,300/month
Housing Winner: Wisconsin (Lower median, lower property tax)
Complete Cost of Living Index
| Category | Illinois | Wisconsin |
|---|---|---|
| Groceries/month | $560 | $540 |
| Utilities/month | $150 | $155 |
| Transportation | 102 | 100 |
| Healthcare | 101 | 100 |
| Overall index | 103 | 100 |
Wisconsin is 3% cheaper than Illinois
Job Market Analysis
Illinois Employment Opportunities
Strongest Sectors:
- Finance: Chicago is major financial center
- Technology: Growing Chicago tech scene
- Manufacturing: Diverse industrial base
- Healthcare: Excellent medical centers
- Transportation: Hub for railroads, trucking
Salary Information:
- Average salary: $58,200
- Finance: $80,000-$130,000
- Tech: $90,000-$135,000
- Healthcare: $70,000-$95,000
- Unemployment rate: 4.1%
Veterans Employment Rate: 88%
Wisconsin Employment Opportunities
Strongest Sectors:
- Manufacturing: Diverse industrial base
- Healthcare: Growing medical sector
- Technology: Madison tech corridor
- Agriculture: Food processing
- Paper/Forestry: Still significant
Salary Information:
- Average salary: $54,800
- Manufacturing: $50,000-$75,000
- Healthcare: $65,000-$85,000
- Tech: $80,000-$115,000
- Unemployment rate: 3.2%
Veterans Employment Rate: 90%
Job Market Winner: Illinois (Higher salaries, especially in finance/tech)
VA Healthcare Access
Illinois VA Healthcare Network
Major Medical Centers:
- VA Chicago Health Care System
- Edward Hines, Jr. VA Medical Center
- VA Southern Illinois Health Care System
- VA Illiana Health Care System
Network Details:
- Primary care providers: 2,400+
- Mental health specialists: 550+
- Average wait time: 20 days
- Community clinics: 55+
- Patient satisfaction: 4.0/5 stars
- Coverage: Excellent urban, good statewide
Wisconsin VA Healthcare Network
Major Medical Centers:
- VA Wisconsin Health Care System
- Tomah VA Medical Center
- Madison VA Medical Center
Network Details:
- Primary care providers: 1,400+
- Mental health specialists: 350+
- Average wait time: 18 days
- Community clinics: 32+
- Patient satisfaction: 4.2/5 stars
- Coverage: Good statewide
Healthcare Winner: Wisconsin (Shorter wait times, higher satisfaction despite fewer providers)
Climate and Lifestyle
Illinois Climate
Weather Profile:
- Summer: 85-90°F (moderate humidity)
- Winter: 25-35°F (moderate snow)
- Rainfall: 34-40 inches annually
- Humidity: Moderate
- Natural disasters: Occasional severe storms, tornadoes
Lifestyle:
- Chicago major cultural center
- Outdoor recreation (lakes, parks)
- Sports: Multiple pro teams
- Urban/suburban options
- Strong veteran communities
Wisconsin Climate
Weather Profile:
- Summer: 80-85°F (moderate humidity)
- Winter: 15-25°F (significant snow, ice storms)
- Rainfall: 30-35 inches annually
- Humidity: Moderate
- Natural disasters: Occasional severe storms, blizzards
Lifestyle:
- Lake recreation (Great Lakes, inland lakes)
- Outdoor recreation (skiing, hiking)
- College town culture (Madison)
- More conservative, family-focused
- Growing veteran communities
Climate Winner: Illinois (Warmer winters, less snow)
Detailed 10-Year Cost Analysis
Scenario: Military Retiree - $45,000 Pension + $15,000 Other Income
Illinois 10-Year Costs (Downstate area):
| Category | Annual |
|---|---|
| Housing | $14,400 |
| Property tax | $6,810 |
| Utilities/insurance | $1,800 |
| Groceries | $6,720 |
| Transportation | $4,900 |
| Healthcare | $2,400 |
| State tax | $990 |
| Federal tax | $2,700 |
| Total Annual | $40,720 |
| 10-Year Total | $407,200 |
Wisconsin 10-Year Costs (Milwaukee area):
| Category | Annual |
|---|---|
| Housing | $13,200 |
| Property tax | $5,550 |
| Utilities/insurance | $1,860 |
| Groceries | $6,480 |
| Transportation | $4,800 |
| Healthcare | $2,400 |
| State tax | $3,675 |
| Federal tax | $2,700 |
| Total Annual | $40,665 |
| 10-Year Total | $406,650 |
Essentially tied (Illinois' tax advantage offset by Wisconsin's lower housing costs)
Disability Benefits and Support
Illinois Disabled Veteran Benefits
- Property tax exemption: Up to $6,000 for 100% disabled
- Vehicle registration: Tax exemptions available
- Education: Good state education benefits
- Healthcare: Excellent VA network
- Business incentives: Available
Wisconsin Disabled Veteran Benefits
- Property tax exemptions: Available (varies by municipality)
- Vehicle registration: Tax breaks available
- Education: Good state education benefits
- Healthcare: Excellent VA network
- Business incentives: Available for disabled veteran-owned
Disabled Benefits Winner: Tie (Similar programs, different structures)
Top Veteran Cities
Illinois Top Cities
Chicago
- Cost: High ($320K)
- Jobs: Excellent (finance, tech, diverse)
- VA access: Excellent
- Lifestyle: Major city amenities
- Best for: Career-focused professionals
Downstate Illinois
- Cost: Low ($180K)
- Jobs: Moderate (manufacturing, healthcare)
- VA access: Good
- Lifestyle: Affordable, family-friendly
- Best for: Budget-conscious retirees
Wisconsin Top Cities
Madison
- Cost: Moderate-High ($310K)
- Jobs: Good (tech, education, state government)
- VA access: Good
- Lifestyle: College town, culture, bike-friendly
- Best for: Education-focused, culture-seekers
Milwaukee
- Cost: Affordable ($220K)
- Jobs: Good (manufacturing, healthcare)
- VA access: Good
- Lifestyle: Revitalized city, lakefront
- Best for: Urban-focused budget-conscious
Summary Comparison Table
| Factor | Illinois | Wisconsin |
|---|---|---|
| Military retirement tax | 0% | Taxable |
| Other income tax | 4.95% | 3.54%-7.65% |
| Property tax rate | 2.27% | 1.85% |
| Cost of living | Moderate | Low |
| Housing median | $265,000 | $235,000 |
| Job market | Excellent | Good |
| Average salary | $58,200 | $54,800 |
| VA healthcare | Excellent | Very Good |
| Winter severity | Moderate | Severe |
| Veteran population | Large | Moderate |
Final Verdict
Choose Illinois if:
- You want military retirement tax exemption
- You seek major urban center (Chicago)
- You want higher salaries (career focus)
- You prefer milder winters
- You value urban cultural attractions
Choose Wisconsin if:
- You want lower overall cost of living (3%)
- You prefer affordable housing
- You like college town culture
- You don't mind harsh winters
- You seek outdoor recreation focus
The Numbers: Illinois' military retirement tax advantage ($2,685/year) is offset by Wisconsin's lower housing costs and overall expenses. Over 10 years, costs are essentially equivalent, making this decision lifestyle-driven rather than financial.
Illinois appeals to career-focused veterans in Chicago, while Wisconsin appeals to budget-conscious retirees willing to accept harsh winters for affordability and outdoor recreation.