@Brett585 --
From Illinois Statute Article 3, Section 303/e-5, Allocation and Apportionment of Base Income:
"Unemployment benefits. Unemployment benefits paid by the Illinois Department of Employment Security are allocable to this State."
https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=003500050HArt%2E+3&ActID=577&ChapterID=8&Seq...
In other words, unemployment compensation paid by Illinois is taxable by Illinois, period.
If the recipient has relocated to another state with an income tax, the Illinois unemployment compensation would also be taxable by the "new" state, on the basis that a taxpayer's state of residence may tax all his income, regardless of source. In that instance, the taxpayer would be able a claim a credit on the "new" state return for the tax paid to Illinois on the unemployment received after the relocation.
**Answers are correct to the best of my ability but do not constitute tax or legal advice.
