Moving to Paradise Valley from Illinois: taxes, home prices, and first steps

Nov 14

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Illinois charges a flat 4.95% income tax. Arizona charges a flat 2.5%. That gap, plus a statewide property tax rate about a quarter of Illinois's, is a good place to start for anyone moving from Chicago or its suburbs. If you are looking at Paradise Valley homes for sale, here is how the taxes, home prices, and first steps actually compare, with every figure dated and sourced.

The short answer Arizona's flat 2.5% income tax is about half of Illinois's 4.95%, and its average effective property tax rate on owner occupied homes is 0.48% versus 1.88% in Illinois. Paradise Valley itself levies no property tax. Homes here are priced well above Chicago, with a 12 month median of $3,800,000 as of November 12, 2026, so the savings show up in taxes, not in the purchase price.

What the data says

Arizona individual income tax: 2.5% for all income levels and filing statuses, starting with tax year 2025 (Arizona Department of Revenue, 2025 Individual Income Tax Highlights)
Illinois individual income tax: 4.95% of net income, effective July 1, 2017 (Illinois Department of Revenue, Income Tax Rates)
Effective property tax rate, owner occupied homes: Arizona 0.48%, ranked 47th; Illinois 1.88%, ranked 2nd (Tax Foundation, 2024 Census survey data)
Paradise Valley, past 12 months: 409 sales, $3,800,000 median, $847 per square foot, 62 median days on market, 96% of final list price (Arizona Luxury Partners, ARMLS figures as of November 12, 2026)
Paradise Valley today: 233 homes for sale, $5,322,500 median list price, about 6.8 months of supply (same page, November 12, 2026)
Chicago: $399,722 median sale price, up 5.2% from a year earlier, $284 per square foot, 53 median days on market (Redfin, October 2026)
Illinois statewide: $313,686 median sale price, up 3.5%, 11,187 homes sold (Redfin, October 2026)

Taxes: where the real difference shows up

Income tax

Both states use a flat rate, which makes the comparison simpler than most. On $400,000 of state taxable income, a 4.95% rate works out to $19,800 and a 2.5% rate to $10,000, a difference of $9,800 a year. That example is calculated by Arizona Luxury Partners using the two published rates only. It ignores the different deductions, credits, and definitions of taxable income in each state, so treat it as a sense of scale, not a forecast of your return.

Retirement income is where the comparison can flip. Illinois Department of Revenue Publication 120 lets residents subtract many kinds of federally taxed retirement income, including qualified plan and IRA distributions, Social Security benefits, and government retirement plans. Arizona has its own rules. If most of your income will come from retirement accounts or pensions, run both states with a tax professional before assuming you will save.

Property tax

The Tax Foundation's state table, built from 2024 Census survey data, puts the effective property tax rate on owner occupied homes at 1.88% in Illinois and 0.48% in Arizona. Applied to a $1,000,000 home value, those statewide averages work out to about $18,800 and $4,800 a year, a gap of $14,000 (calculated by Arizona Luxury Partners). A statewide average is not your bill, but the direction is clear.

Paradise Valley adds a twist. As our Paradise Valley property tax guide explains using Maricopa County's adopted fiscal year 2027 levies, the Town levies no property tax at all. Your bill is built from county, community college, special district, and school district levies, and the school district portion changes the most from one address to the next.

Sales tax

The Arizona Department of Revenue lists the Town of Paradise Valley's own transaction privilege tax at 2.50% on retail sales and restaurants, added on top of the state and county rates.

Home prices: what to expect coming from Chicago

The Chicago median sale price was $399,722 in October 2026, according to Redfin. Paradise Valley's 12 month median was $3,800,000 as of November 12, 2026, about 9.5 times higher, and $847 per square foot is roughly three times Chicago's $284 (both ratios calculated by Arizona Luxury Partners). Paradise Valley is built mostly on large single family lots, so the gap reflects land and home size as much as location.

Inside the Town, prices vary widely by community. As of November 12, 2026, Clearwater Hills homes for sale had 10 sales over 12 months at a $3,550,000 median and $975 per square foot. Camelback Country Club Estates homes had 5 sales at a $4,025,000 median as of November 10, 2026. Brand new homes are their own tier: new construction in Paradise Valley showed 49 sales at a $10,000,000 median over the same period. You can also browse Mummy Mountain homes for sale.

If you want the Paradise Valley location without the Paradise Valley price, look next door. Homes for sale in Phoenix 85018, which includes Arcadia, had a $1,243,750 median on 644 sales as of November 11, 2026, and Scottsdale homes for sale had a $960,000 median on 6,611 sales as of November 12, 2026. See where Paradise Valley sits between Phoenix and Scottsdale on our Northeast Valley map.

First steps after you move

Know when you become a resident. The Arizona Department of Transportation counts you as a resident if, for example, you stay seven months or more in a calendar year, work here, register to vote here, or get a state license or pay school tuition as a resident.
Register your vehicles. ADOT says a vehicle brought from another state must be registered as soon as you become a resident. Bring the current title and registration from Illinois.
Check emissions first. Some vehicles in the Phoenix metro need an emissions test before registration. Pass it before your MVD visit.
Get your Arizona license. Bring proof of authorized presence, your Illinois license or ID, and your Social Security number. For a Travel ID, add two documents with your Arizona address, such as a utility bill or bank statement.
Pull the parcel's tax history. Before you offer, look up the specific parcel's bill and school district instead of relying on averages.
Avoid this mistake: assuming your Illinois tax savings will cover a higher purchase price. Income tax savings depend on your income type, and the price gap between Chicago and Paradise Valley can be far larger than any annual tax difference. Build your budget from the home's actual price, taxes, and insurance.

A practical note on climate: Illinois buyers often time their first visits for winter. Plan at least one visit in summer too, so you see how a home handles the heat and what cooling costs look like.

The honest caveats

The Tax Foundation rates are statewide averages from 2024 survey data. County and parcel bills in both states can be far above or below them.
The income tax example uses rates only. Deductions, credits, and retirement income rules can change the result a lot.
Redfin's Chicago and Illinois figures and our Paradise Valley figures come from different sources and time windows. Do not read them as one data set.
Small communities such as Camelback Country Club Estates have only a handful of sales a year, so one sale can move the median.
This is general information, not tax, legal, or financial advice. Check with a tax professional about your own situation.

Frequently asked questions

Is Arizona's income tax lower than Illinois income tax?

Arizona applies a flat 2.5% rate to all income levels starting with tax year 2025, according to the Arizona Department of Revenue. Illinois applies a flat 4.95% individual rate, in effect since July 1, 2017, according to the Illinois Department of Revenue. Each state figures taxable income its own way, so the rate gap is a starting point, not your final answer.

Does Illinois tax retirement income?

Illinois Department of Revenue Publication 120 lets residents subtract many kinds of federally taxed retirement income, including qualified plan and IRA distributions, Social Security benefits, and government retirement plans. Arizona treats retirement income under its own rules. If retirement income is a large part of your household income, compare both states with a tax professional before you move.

Are property taxes lower in Arizona than in Illinois?

On average, yes. The Tax Foundation, using 2024 Census survey data, puts the effective property tax rate on owner occupied homes at 0.48% in Arizona and 1.88% in Illinois, second highest in the country. Your actual bill depends on the parcel, its assessed value, and the districts it sits in.

Does the Town of Paradise Valley charge a property tax?

No. The Town levies no property tax, but owners still receive a bill built from county, community college, special district, and school district levies, based on Maricopa County's adopted rates. The school district portion is the part that varies most from one Paradise Valley address to another.

How much do homes cost in Paradise Valley?

As of November 12, 2026, 409 Paradise Valley homes had sold over the past 12 months at a median price of $3,800,000, or $847 per square foot, after a median of 62 days on market. There were 233 homes for sale at a median list price of $5,322,500, about 6.8 months of supply. These are ARMLS figures calculated by Arizona Luxury Partners.

How do Paradise Valley home prices compare with Chicago?

Redfin reports a Chicago median sale price of $399,722 for October 2026, with a median of $284 per square foot. Paradise Valley's 12 month median was $3,800,000, or $847 per square foot, as of November 12, 2026. The two markets have very different home and lot types, so price per square foot is the fairer comparison, and even that is only a rough guide.

When do I need an Arizona driver license and registration after moving?

The Arizona Department of Transportation says you must register a vehicle brought from another state as soon as you become an Arizona resident. For a license, bring proof of authorized presence, your current out of state license or ID, and your Social Security number. A Travel ID also requires two documents showing your Arizona address.

Who counts as an Arizona resident for MVD purposes?

ADOT lists several tests. You are a resident if, for example, you stay in Arizona seven months or more in a calendar year, work in Arizona, register to vote here, or obtain a state license or pay school tuition as a resident. Part year owners should read the full ADOT list to see which test applies.

Do I need an emissions test to register my car in Paradise Valley?

Possibly. ADOT says some vehicles in the Phoenix metro and Tucson areas need an emissions test before registration, and Paradise Valley is in the Phoenix metro. Check your vehicle's requirement with ADOT and pass the test before your MVD visit to save a trip.

Are there Northeast Valley homes priced below Paradise Valley?

Yes, at every price point. As of November 12, 2026, Scottsdale's 12 month median sale price was $960,000 on 6,611 sales, and Phoenix ZIP 85018 next door had a median of $1,243,750 on 644 sales as of November 11, 2026. Paradise Valley sits at the top of the range, but it is one of many nearby options.

The bottom line

For buyers moving from Illinois, Arizona's lower income tax rate and much lower average property tax rate are real, and Paradise Valley adds no town property tax on top. The purchase price is the bigger number, though. Run your own tax numbers with a professional, look at the specific parcel, and compare Paradise Valley with nearby Scottsdale and Phoenix ZIP codes before you decide.

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Kyle Hermann
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Cheryl Solano
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Sources

Arizona Department of Revenue, Individual Income Tax Highlights, 2025, accessed November 14, 2026. Link
Illinois Department of Revenue, Income Tax Rates, accessed November 14, 2026. Link
Illinois Department of Revenue, Publication 120, Retirement Income, accessed November 14, 2026. Link
Tax Foundation, Property Taxes by State and County, 2026 (Table 2, effective rates on owner occupied housing, 2024), accessed November 14, 2026. Link
Arizona Department of Revenue, Paradise Valley Transaction Privilege Tax and Use Tax Rates, accessed November 14, 2026. Link
Arizona Department of Transportation, New to AZ, accessed November 14, 2026. Link
Redfin, Chicago Housing Market, October 2026, accessed November 14, 2026. Link
Redfin, Illinois Housing Market, October 2026, accessed November 14, 2026. Link
Arizona Luxury Partners, Paradise Valley homes for sale, ARMLS figures as of November 12, 2026; Clearwater Hills and Paradise Valley new construction pages as of November 12, 2026; Camelback Country Club Estates page as of November 10, 2026; Phoenix 85018 page as of November 11, 2026; Scottsdale page as of November 12, 2026. Link
Arizona Luxury Partners, Paradise Valley property taxes guide, November 8, 2026, based on Maricopa County Adopted Property Tax Levies and Rates, Fiscal Year 2027. Link
Income tax example calculated by Arizona Luxury Partners: $400,000 of state taxable income at 4.95% ($19,800) and 2.5% ($10,000), difference $9,800.
Property tax example calculated by Arizona Luxury Partners: $1,000,000 home value at statewide effective rates of 1.88% ($18,800) and 0.48% ($4,800), difference $14,000.
Price ratios calculated by Arizona Luxury Partners: $3,800,000 divided by $399,722 (about 9.5) and $847 divided by $284 (about 3.0).

All information provided is deemed reliable but is not guaranteed and should be independently verified. This article is for general information only and is not financial, lending, legal, or tax advice. Arizona Luxury Partners | Real Estate Group at RE/MAX Fine Properties, 21020 N. Pima Road, Scottsdale, AZ 85255. Brokerage License LC629808000. Equal Housing Opportunity.

Kyle Hermann