Sen. David Koehler
Filed: 1/24/2022
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1 | AMENDMENT TO SENATE BILL 2247
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2 | AMENDMENT NO. ______. Amend Senate Bill 2247 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 1. Short title. This Act may be cited as the | ||||||
5 | Illinois Broadband Investment Act. | ||||||
6 | Section 3. The Illinois Procurement Code is amended by | ||||||
7 | changing Section 1-10 as follows:
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8 | (30 ILCS 500/1-10)
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9 | Sec. 1-10. Application.
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10 | (a) This Code applies only to procurements for which | ||||||
11 | bidders, offerors, potential contractors, or contractors were | ||||||
12 | first
solicited on or after July 1, 1998. This Code shall not | ||||||
13 | be construed to affect
or impair any contract, or any | ||||||
14 | provision of a contract, entered into based on a
solicitation | ||||||
15 | prior to the implementation date of this Code as described in
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1 | Article 99, including, but not limited to, any covenant | ||||||
2 | entered into with respect
to any revenue bonds or similar | ||||||
3 | instruments.
All procurements for which contracts are | ||||||
4 | solicited between the effective date
of Articles 50 and 99 and | ||||||
5 | July 1, 1998 shall be substantially in accordance
with this | ||||||
6 | Code and its intent.
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7 | (b) This Code shall apply regardless of the source of the | ||||||
8 | funds with which
the contracts are paid, including federal | ||||||
9 | assistance moneys. This
Code shall
not apply to:
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10 | (1) Contracts between the State and its political | ||||||
11 | subdivisions or other
governments, or between State | ||||||
12 | governmental bodies, except as specifically provided in | ||||||
13 | this Code.
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14 | (2) Grants, except for the filing requirements of | ||||||
15 | Section 20-80.
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16 | (3) Purchase of care, except as provided in Section | ||||||
17 | 5-30.6 of the Illinois Public Aid
Code and this Section.
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18 | (4) Hiring of an individual as an employee and not as | ||||||
19 | an independent
contractor, whether pursuant to an | ||||||
20 | employment code or policy or by contract
directly with | ||||||
21 | that individual.
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22 | (5) Collective bargaining contracts.
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23 | (6) Purchase of real estate, except that notice of | ||||||
24 | this type of contract with a value of more than $25,000 | ||||||
25 | must be published in the Procurement Bulletin within 10 | ||||||
26 | calendar days after the deed is recorded in the county of |
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1 | jurisdiction. The notice shall identify the real estate | ||||||
2 | purchased, the names of all parties to the contract, the | ||||||
3 | value of the contract, and the effective date of the | ||||||
4 | contract.
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5 | (7) Contracts necessary to prepare for anticipated | ||||||
6 | litigation, enforcement
actions, or investigations, | ||||||
7 | provided
that the chief legal counsel to the Governor | ||||||
8 | shall give his or her prior
approval when the procuring | ||||||
9 | agency is one subject to the jurisdiction of the
Governor, | ||||||
10 | and provided that the chief legal counsel of any other | ||||||
11 | procuring
entity
subject to this Code shall give his or | ||||||
12 | her prior approval when the procuring
entity is not one | ||||||
13 | subject to the jurisdiction of the Governor.
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14 | (8) (Blank).
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15 | (9) Procurement expenditures by the Illinois | ||||||
16 | Conservation Foundation
when only private funds are used.
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17 | (10) (Blank). | ||||||
18 | (11) Public-private agreements entered into according | ||||||
19 | to the procurement requirements of Section 20 of the | ||||||
20 | Public-Private Partnerships for Transportation Act and | ||||||
21 | design-build agreements entered into according to the | ||||||
22 | procurement requirements of Section 25 of the | ||||||
23 | Public-Private Partnerships for Transportation Act. | ||||||
24 | (12) (A) Contracts for legal, financial, and other | ||||||
25 | professional and artistic services entered into by the | ||||||
26 | Illinois Finance Authority in which the State of Illinois |
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1 | is not obligated. Such contracts shall be awarded through | ||||||
2 | a competitive process authorized by the members of the | ||||||
3 | Illinois Finance Authority and are subject to Sections | ||||||
4 | 5-30, 20-160, 50-13, 50-20, 50-35, and 50-37 of this Code, | ||||||
5 | as well as the final approval by the members of the | ||||||
6 | Illinois Finance Authority of the terms of the contract. | ||||||
7 | (B) Contracts for legal and financial services entered | ||||||
8 | into by the Illinois Housing Development Authority in | ||||||
9 | connection with the issuance of bonds in which the State | ||||||
10 | of Illinois is not obligated. Such contracts shall be | ||||||
11 | awarded through a competitive process authorized by the | ||||||
12 | members of the Illinois Housing Development Authority and | ||||||
13 | are subject to Sections 5-30, 20-160, 50-13, 50-20, 50-35, | ||||||
14 | and 50-37 of this Code, as well as the final approval by | ||||||
15 | the members of the Illinois Housing Development Authority | ||||||
16 | of the terms of the contract. | ||||||
17 | (13) Contracts for services, commodities, and | ||||||
18 | equipment to support the delivery of timely forensic | ||||||
19 | science services in consultation with and subject to the | ||||||
20 | approval of the Chief Procurement Officer as provided in | ||||||
21 | subsection (d) of Section 5-4-3a of the Unified Code of | ||||||
22 | Corrections, except for the requirements of Sections | ||||||
23 | 20-60, 20-65, 20-70, and 20-160 and Article 50 of this | ||||||
24 | Code; however, the Chief Procurement Officer may, in | ||||||
25 | writing with justification, waive any certification | ||||||
26 | required under Article 50 of this Code. For any contracts |
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1 | for services which are currently provided by members of a | ||||||
2 | collective bargaining agreement, the applicable terms of | ||||||
3 | the collective bargaining agreement concerning | ||||||
4 | subcontracting shall be followed. | ||||||
5 | On and after January 1, 2019, this paragraph (13), | ||||||
6 | except for this sentence, is inoperative. | ||||||
7 | (14) Contracts for participation expenditures required | ||||||
8 | by a domestic or international trade show or exhibition of | ||||||
9 | an exhibitor, member, or sponsor. | ||||||
10 | (15) Contracts with a railroad or utility that | ||||||
11 | requires the State to reimburse the railroad or utilities | ||||||
12 | for the relocation of utilities for construction or other | ||||||
13 | public purpose. Contracts included within this paragraph | ||||||
14 | (15) shall include, but not be limited to, those | ||||||
15 | associated with: relocations, crossings, installations, | ||||||
16 | and maintenance. For the purposes of this paragraph (15), | ||||||
17 | "railroad" means any form of non-highway ground | ||||||
18 | transportation that runs on rails or electromagnetic | ||||||
19 | guideways and "utility" means: (1) public utilities as | ||||||
20 | defined in Section 3-105 of the Public Utilities Act, (2) | ||||||
21 | telecommunications carriers as defined in Section 13-202 | ||||||
22 | of the Public Utilities Act, (3) electric cooperatives as | ||||||
23 | defined in Section 3.4 of the Electric Supplier Act, (4) | ||||||
24 | telephone or telecommunications cooperatives as defined in | ||||||
25 | Section 13-212 of the Public Utilities Act, (5) rural | ||||||
26 | water or waste water systems with 10,000 connections or |
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1 | less, (6) a holder as defined in Section 21-201 of the | ||||||
2 | Public Utilities Act, and (7) municipalities owning or | ||||||
3 | operating utility systems consisting of public utilities | ||||||
4 | as that term is defined in Section 11-117-2 of the | ||||||
5 | Illinois Municipal Code. | ||||||
6 | (16) Procurement expenditures necessary for the | ||||||
7 | Department of Public Health to provide the delivery of | ||||||
8 | timely newborn screening services in accordance with the | ||||||
9 | Newborn Metabolic Screening Act. | ||||||
10 | (17) Procurement expenditures necessary for the | ||||||
11 | Department of Agriculture, the Department of Financial and | ||||||
12 | Professional Regulation, the Department of Human Services, | ||||||
13 | and the Department of Public Health to implement the | ||||||
14 | Compassionate Use of Medical Cannabis Program and Opioid | ||||||
15 | Alternative Pilot Program requirements and ensure access | ||||||
16 | to medical cannabis for patients with debilitating medical | ||||||
17 | conditions in accordance with the Compassionate Use of | ||||||
18 | Medical Cannabis Program Act. | ||||||
19 | (18) This Code does not apply to any procurements | ||||||
20 | necessary for the Department of Agriculture, the | ||||||
21 | Department of Financial and Professional Regulation, the | ||||||
22 | Department of Human Services, the Department of Commerce | ||||||
23 | and Economic Opportunity, and the Department of Public | ||||||
24 | Health to implement the Cannabis Regulation and Tax Act if | ||||||
25 | the applicable agency has made a good faith determination | ||||||
26 | that it is necessary and appropriate for the expenditure |
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1 | to fall within this exemption and if the process is | ||||||
2 | conducted in a manner substantially in accordance with the | ||||||
3 | requirements of Sections 20-160, 25-60, 30-22, 50-5, | ||||||
4 | 50-10, 50-10.5, 50-12, 50-13, 50-15, 50-20, 50-21, 50-35, | ||||||
5 | 50-36, 50-37, 50-38, and 50-50 of this Code; however, for | ||||||
6 | Section 50-35, compliance applies only to contracts or | ||||||
7 | subcontracts over $100,000. Notice of each contract | ||||||
8 | entered into under this paragraph (18) that is related to | ||||||
9 | the procurement of goods and services identified in | ||||||
10 | paragraph (1) through (9) of this subsection shall be | ||||||
11 | published in the Procurement Bulletin within 14 calendar | ||||||
12 | days after contract execution. The Chief Procurement | ||||||
13 | Officer shall prescribe the form and content of the | ||||||
14 | notice. Each agency shall provide the Chief Procurement | ||||||
15 | Officer, on a monthly basis, in the form and content | ||||||
16 | prescribed by the Chief Procurement Officer, a report of | ||||||
17 | contracts that are related to the procurement of goods and | ||||||
18 | services identified in this subsection. At a minimum, this | ||||||
19 | report shall include the name of the contractor, a | ||||||
20 | description of the supply or service provided, the total | ||||||
21 | amount of the contract, the term of the contract, and the | ||||||
22 | exception to this Code utilized. A copy of any or all of | ||||||
23 | these contracts shall be made available to the Chief | ||||||
24 | Procurement Officer immediately upon request. The Chief | ||||||
25 | Procurement Officer shall submit a report to the Governor | ||||||
26 | and General Assembly no later than November 1 of each year |
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1 | that includes, at a minimum, an annual summary of the | ||||||
2 | monthly information reported to the Chief Procurement | ||||||
3 | Officer. This exemption becomes inoperative 5 years after | ||||||
4 | June 25, 2022 June 25, 2019 (the effective date of Public | ||||||
5 | Act 101-27) . | ||||||
6 | (19) Acquisition of modifications or adjustments, | ||||||
7 | limited to assistive technology devices and assistive | ||||||
8 | technology services, adaptive equipment, repairs, and | ||||||
9 | replacement parts to provide reasonable accommodations (i) | ||||||
10 | that enable a qualified applicant with a disability to | ||||||
11 | complete the job application process and be considered for | ||||||
12 | the position such qualified applicant desires, (ii) that | ||||||
13 | modify or adjust the work environment to enable a | ||||||
14 | qualified current employee with a disability to perform | ||||||
15 | the essential functions of the position held by that | ||||||
16 | employee, (iii) to enable a qualified current employee | ||||||
17 | with a disability to enjoy equal benefits and privileges | ||||||
18 | of employment as are enjoyed by its other similarly | ||||||
19 | situated employees without disabilities, and (iv) that | ||||||
20 | allow a customer, client, claimant , or member of the | ||||||
21 | public seeking State services full use and enjoyment of | ||||||
22 | and access to its programs, services, or benefits. | ||||||
23 | For purposes of this paragraph (19): | ||||||
24 | "Assistive technology devices" means any item, piece | ||||||
25 | of equipment, or product system, whether acquired | ||||||
26 | commercially off the shelf, modified, or customized, that |
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1 | is used to increase, maintain, or improve functional | ||||||
2 | capabilities of individuals with disabilities. | ||||||
3 | "Assistive technology services" means any service that | ||||||
4 | directly assists an individual with a disability in | ||||||
5 | selection, acquisition, or use of an assistive technology | ||||||
6 | device. | ||||||
7 | "Qualified" has the same meaning and use as provided | ||||||
8 | under the federal Americans with Disabilities Act when | ||||||
9 | describing an individual with a disability. | ||||||
10 | (20) (19) Procurement expenditures necessary for the
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11 | Illinois Commerce Commission to hire third-party
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12 | facilitators pursuant to Sections 16-105.17 and Section
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13 | 16-108.18 of the Public Utilities Act or an ombudsman | ||||||
14 | pursuant to Section 16-107.5 of the Public Utilities Act, | ||||||
15 | a facilitator pursuant to Section 16-105.17 of the Public | ||||||
16 | Utilities Act, or a grid auditor pursuant to Section | ||||||
17 | 16-105.10 of the Public Utilities Act. | ||||||
18 | Notwithstanding any other provision of law, for contracts | ||||||
19 | entered into on or after October 1, 2017 under an exemption | ||||||
20 | provided in any paragraph of this subsection (b), except | ||||||
21 | paragraph (1), (2), or (5), each State agency shall post to the | ||||||
22 | appropriate procurement bulletin the name of the contractor, a | ||||||
23 | description of the supply or service provided, the total | ||||||
24 | amount of the contract, the term of the contract, and the | ||||||
25 | exception to the Code utilized. The chief procurement officer | ||||||
26 | shall submit a report to the Governor and General Assembly no |
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1 | later than November 1 of each year that shall include, at a | ||||||
2 | minimum, an annual summary of the monthly information reported | ||||||
3 | to the chief procurement officer. | ||||||
4 | (c) This Code does not apply to the electric power | ||||||
5 | procurement process provided for under Section 1-75 of the | ||||||
6 | Illinois Power Agency Act and Section 16-111.5 of the Public | ||||||
7 | Utilities Act. | ||||||
8 | (d) Except for Section 20-160 and Article 50 of this Code, | ||||||
9 | and as expressly required by Section 9.1 of the Illinois | ||||||
10 | Lottery Law, the provisions of this Code do not apply to the | ||||||
11 | procurement process provided for under Section 9.1 of the | ||||||
12 | Illinois Lottery Law. | ||||||
13 | (e) This Code does not apply to the process used by the | ||||||
14 | Capital Development Board to retain a person or entity to | ||||||
15 | assist the Capital Development Board with its duties related | ||||||
16 | to the determination of costs of a clean coal SNG brownfield | ||||||
17 | facility, as defined by Section 1-10 of the Illinois Power | ||||||
18 | Agency Act, as required in subsection (h-3) of Section 9-220 | ||||||
19 | of the Public Utilities Act, including calculating the range | ||||||
20 | of capital costs, the range of operating and maintenance | ||||||
21 | costs, or the sequestration costs or monitoring the | ||||||
22 | construction of clean coal SNG brownfield facility for the | ||||||
23 | full duration of construction. | ||||||
24 | (f) (Blank). | ||||||
25 | (g) (Blank). | ||||||
26 | (g-5) This Code does not apply to the leasing of |
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1 | State-owned facilities by a wireless carrier, as defined in | ||||||
2 | Section 2 of the Emergency Telephone System Act, and does not | ||||||
3 | apply to the leasing of State-owned facilities by a cable | ||||||
4 | operator, a holder, or a provider of broadband services, as | ||||||
5 | those terms are defined by Section 21-201 of the Public | ||||||
6 | Utilities Act. | ||||||
7 | (h) This Code does not apply to the process to procure or | ||||||
8 | contracts entered into in accordance with Sections 11-5.2 and | ||||||
9 | 11-5.3 of the Illinois Public Aid Code. | ||||||
10 | (i) Each chief procurement officer may access records | ||||||
11 | necessary to review whether a contract, purchase, or other | ||||||
12 | expenditure is or is not subject to the provisions of this | ||||||
13 | Code, unless such records would be subject to attorney-client | ||||||
14 | privilege. | ||||||
15 | (j) This Code does not apply to the process used by the | ||||||
16 | Capital Development Board to retain an artist or work or works | ||||||
17 | of art as required in Section 14 of the Capital Development | ||||||
18 | Board Act. | ||||||
19 | (k) This Code does not apply to the process to procure | ||||||
20 | contracts, or contracts entered into, by the State Board of | ||||||
21 | Elections or the State Electoral Board for hearing officers | ||||||
22 | appointed pursuant to the Election Code. | ||||||
23 | (l) This Code does not apply to the processes used by the | ||||||
24 | Illinois Student Assistance Commission to procure supplies and | ||||||
25 | services paid for from the private funds of the Illinois | ||||||
26 | Prepaid Tuition Fund. As used in this subsection (l), "private |
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1 | funds" means funds derived from deposits paid into the | ||||||
2 | Illinois Prepaid Tuition Trust Fund and the earnings thereon. | ||||||
3 | (m) This Code shall apply regardless of the source of | ||||||
4 | funds with which contracts are paid, including federal | ||||||
5 | assistance moneys. Except as specifically provided in this | ||||||
6 | Code, this Code shall not apply to procurement expenditures | ||||||
7 | necessary for the Department of Public Health to conduct the | ||||||
8 | Healthy Illinois Survey in accordance with Section 2310-431 of | ||||||
9 | the Department of Public Health Powers and Duties Law of the | ||||||
10 | Civil Administrative Code of Illinois. | ||||||
11 | (Source: P.A. 101-27, eff. 6-25-19; 101-81, eff. 7-12-19; | ||||||
12 | 101-363, eff. 8-9-19; 102-175, eff. 7-29-21; 102-483, eff | ||||||
13 | 1-1-22; 102-558, eff. 8-20-21; 102-600, eff. 8-27-21; 102-662, | ||||||
14 | eff. 9-15-21; revised 11-23-21.)
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15 | Section 5. The Illinois Income Tax Act is amended by | ||||||
16 | changing Section 201 as follows:
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17 | (35 ILCS 5/201)
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18 | Sec. 201. Tax imposed. | ||||||
19 | (a) In general. A tax measured by net income is hereby | ||||||
20 | imposed on every
individual, corporation, trust and estate for | ||||||
21 | each taxable year ending
after July 31, 1969 on the privilege | ||||||
22 | of earning or receiving income in or
as a resident of this | ||||||
23 | State. Such tax shall be in addition to all other
occupation or | ||||||
24 | privilege taxes imposed by this State or by any municipal
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1 | corporation or political subdivision thereof. | ||||||
2 | (b) Rates. The tax imposed by subsection (a) of this | ||||||
3 | Section shall be
determined as follows, except as adjusted by | ||||||
4 | subsection (d-1): | ||||||
5 | (1) In the case of an individual, trust or estate, for | ||||||
6 | taxable years
ending prior to July 1, 1989, an amount | ||||||
7 | equal to 2 1/2% of the taxpayer's
net income for the | ||||||
8 | taxable year. | ||||||
9 | (2) In the case of an individual, trust or estate, for | ||||||
10 | taxable years
beginning prior to July 1, 1989 and ending | ||||||
11 | after June 30, 1989, an amount
equal to the sum of (i) 2 | ||||||
12 | 1/2% of the taxpayer's net income for the period
prior to | ||||||
13 | July 1, 1989, as calculated under Section 202.3, and (ii) | ||||||
14 | 3% of the
taxpayer's net income for the period after June | ||||||
15 | 30, 1989, as calculated
under Section 202.3. | ||||||
16 | (3) In the case of an individual, trust or estate, for | ||||||
17 | taxable years
beginning after June 30, 1989, and ending | ||||||
18 | prior to January 1, 2011, an amount equal to 3% of the | ||||||
19 | taxpayer's net
income for the taxable year. | ||||||
20 | (4) In the case of an individual, trust, or estate, | ||||||
21 | for taxable years beginning prior to January 1, 2011, and | ||||||
22 | ending after December 31, 2010, an amount equal to the sum | ||||||
23 | of (i) 3% of the taxpayer's net income for the period prior | ||||||
24 | to January 1, 2011, as calculated under Section 202.5, and | ||||||
25 | (ii) 5% of the taxpayer's net income for the period after | ||||||
26 | December 31, 2010, as calculated under Section 202.5. |
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1 | (5) In the case of an individual, trust, or estate, | ||||||
2 | for taxable years beginning on or after January 1, 2011, | ||||||
3 | and ending prior to January 1, 2015, an amount equal to 5% | ||||||
4 | of the taxpayer's net income for the taxable year. | ||||||
5 | (5.1) In the case of an individual, trust, or estate, | ||||||
6 | for taxable years beginning prior to January 1, 2015, and | ||||||
7 | ending after December 31, 2014, an amount equal to the sum | ||||||
8 | of (i) 5% of the taxpayer's net income for the period prior | ||||||
9 | to January 1, 2015, as calculated under Section 202.5, and | ||||||
10 | (ii) 3.75% of the taxpayer's net income for the period | ||||||
11 | after December 31, 2014, as calculated under Section | ||||||
12 | 202.5. | ||||||
13 | (5.2) In the case of an individual, trust, or estate, | ||||||
14 | for taxable years beginning on or after January 1, 2015, | ||||||
15 | and ending prior to July 1, 2017, an amount equal to 3.75% | ||||||
16 | of the taxpayer's net income for the taxable year. | ||||||
17 | (5.3) In the case of an individual, trust, or estate, | ||||||
18 | for taxable years beginning prior to July 1, 2017, and | ||||||
19 | ending after June 30, 2017, an amount equal to the sum of | ||||||
20 | (i) 3.75% of the taxpayer's net income for the period | ||||||
21 | prior to July 1, 2017, as calculated under Section 202.5, | ||||||
22 | and (ii) 4.95% of the taxpayer's net income for the period | ||||||
23 | after June 30, 2017, as calculated under Section 202.5. | ||||||
24 | (5.4) In the case of an individual, trust, or estate, | ||||||
25 | for taxable years beginning on or after July 1, 2017, an | ||||||
26 | amount equal to 4.95% of the taxpayer's net income for the |
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1 | taxable year. | ||||||
2 | (6) In the case of a corporation, for taxable years
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3 | ending prior to July 1, 1989, an amount equal to 4% of the
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4 | taxpayer's net income for the taxable year. | ||||||
5 | (7) In the case of a corporation, for taxable years | ||||||
6 | beginning prior to
July 1, 1989 and ending after June 30, | ||||||
7 | 1989, an amount equal to the sum of
(i) 4% of the | ||||||
8 | taxpayer's net income for the period prior to July 1, | ||||||
9 | 1989,
as calculated under Section 202.3, and (ii) 4.8% of | ||||||
10 | the taxpayer's net
income for the period after June 30, | ||||||
11 | 1989, as calculated under Section
202.3. | ||||||
12 | (8) In the case of a corporation, for taxable years | ||||||
13 | beginning after
June 30, 1989, and ending prior to January | ||||||
14 | 1, 2011, an amount equal to 4.8% of the taxpayer's net | ||||||
15 | income for the
taxable year. | ||||||
16 | (9) In the case of a corporation, for taxable years | ||||||
17 | beginning prior to January 1, 2011, and ending after | ||||||
18 | December 31, 2010, an amount equal to the sum of (i) 4.8% | ||||||
19 | of the taxpayer's net income for the period prior to | ||||||
20 | January 1, 2011, as calculated under Section 202.5, and | ||||||
21 | (ii) 7% of the taxpayer's net income for the period after | ||||||
22 | December 31, 2010, as calculated under Section 202.5. | ||||||
23 | (10) In the case of a corporation, for taxable years | ||||||
24 | beginning on or after January 1, 2011, and ending prior to | ||||||
25 | January 1, 2015, an amount equal to 7% of the taxpayer's | ||||||
26 | net income for the taxable year. |
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1 | (11) In the case of a corporation, for taxable years | ||||||
2 | beginning prior to January 1, 2015, and ending after | ||||||
3 | December 31, 2014, an amount equal to the sum of (i) 7% of | ||||||
4 | the taxpayer's net income for the period prior to January | ||||||
5 | 1, 2015, as calculated under Section 202.5, and (ii) 5.25% | ||||||
6 | of the taxpayer's net income for the period after December | ||||||
7 | 31, 2014, as calculated under Section 202.5. | ||||||
8 | (12) In the case of a corporation, for taxable years | ||||||
9 | beginning on or after January 1, 2015, and ending prior to | ||||||
10 | July 1, 2017, an amount equal to 5.25% of the taxpayer's | ||||||
11 | net income for the taxable year. | ||||||
12 | (13) In the case of a corporation, for taxable years | ||||||
13 | beginning prior to July 1, 2017, and ending after June 30, | ||||||
14 | 2017, an amount equal to the sum of (i) 5.25% of the | ||||||
15 | taxpayer's net income for the period prior to July 1, | ||||||
16 | 2017, as calculated under Section 202.5, and (ii) 7% of | ||||||
17 | the taxpayer's net income for the period after June 30, | ||||||
18 | 2017, as calculated under Section 202.5. | ||||||
19 | (14) In the case of a corporation, for taxable years | ||||||
20 | beginning on or after July 1, 2017, an amount equal to 7% | ||||||
21 | of the taxpayer's net income for the taxable year. | ||||||
22 | The rates under this subsection (b) are subject to the | ||||||
23 | provisions of Section 201.5. | ||||||
24 | (b-5) Surcharge; sale or exchange of assets, properties, | ||||||
25 | and intangibles of organization gaming licensees. For each of | ||||||
26 | taxable years 2019 through 2027, a surcharge is imposed on all |
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| |||||||
1 | taxpayers on income arising from the sale or exchange of | ||||||
2 | capital assets, depreciable business property, real property | ||||||
3 | used in the trade or business, and Section 197 intangibles (i) | ||||||
4 | of an organization licensee under the Illinois Horse Racing | ||||||
5 | Act of 1975 and (ii) of an organization gaming licensee under | ||||||
6 | the Illinois Gambling Act. The amount of the surcharge is | ||||||
7 | equal to the amount of federal income tax liability for the | ||||||
8 | taxable year attributable to those sales and exchanges. The | ||||||
9 | surcharge imposed shall not apply if: | ||||||
10 | (1) the organization gaming license, organization | ||||||
11 | license, or racetrack property is transferred as a result | ||||||
12 | of any of the following: | ||||||
13 | (A) bankruptcy, a receivership, or a debt | ||||||
14 | adjustment initiated by or against the initial | ||||||
15 | licensee or the substantial owners of the initial | ||||||
16 | licensee; | ||||||
17 | (B) cancellation, revocation, or termination of | ||||||
18 | any such license by the Illinois Gaming Board or the | ||||||
19 | Illinois Racing Board; | ||||||
20 | (C) a determination by the Illinois Gaming Board | ||||||
21 | that transfer of the license is in the best interests | ||||||
22 | of Illinois gaming; | ||||||
23 | (D) the death of an owner of the equity interest in | ||||||
24 | a licensee; | ||||||
25 | (E) the acquisition of a controlling interest in | ||||||
26 | the stock or substantially all of the assets of a |
| |||||||
| |||||||
1 | publicly traded company; | ||||||
2 | (F) a transfer by a parent company to a wholly | ||||||
3 | owned subsidiary; or | ||||||
4 | (G) the transfer or sale to or by one person to | ||||||
5 | another person where both persons were initial owners | ||||||
6 | of the license when the license was issued; or | ||||||
7 | (2) the controlling interest in the organization | ||||||
8 | gaming license, organization license, or racetrack | ||||||
9 | property is transferred in a transaction to lineal | ||||||
10 | descendants in which no gain or loss is recognized or as a | ||||||
11 | result of a transaction in accordance with Section 351 of | ||||||
12 | the Internal Revenue Code in which no gain or loss is | ||||||
13 | recognized; or | ||||||
14 | (3) live horse racing was not conducted in 2010 at a | ||||||
15 | racetrack located within 3 miles of the Mississippi River | ||||||
16 | under a license issued pursuant to the Illinois Horse | ||||||
17 | Racing Act of 1975. | ||||||
18 | The transfer of an organization gaming license, | ||||||
19 | organization license, or racetrack property by a person other | ||||||
20 | than the initial licensee to receive the organization gaming | ||||||
21 | license is not subject to a surcharge. The Department shall | ||||||
22 | adopt rules necessary to implement and administer this | ||||||
23 | subsection. | ||||||
24 | (c) Personal Property Tax Replacement Income Tax.
| ||||||
25 | Beginning on July 1, 1979 and thereafter, in addition to such | ||||||
26 | income
tax, there is also hereby imposed the Personal Property |
| |||||||
| |||||||
1 | Tax Replacement
Income Tax measured by net income on every | ||||||
2 | corporation (including Subchapter
S corporations), partnership | ||||||
3 | and trust, for each taxable year ending after
June 30, 1979. | ||||||
4 | Such taxes are imposed on the privilege of earning or
| ||||||
5 | receiving income in or as a resident of this State. The | ||||||
6 | Personal Property
Tax Replacement Income Tax shall be in | ||||||
7 | addition to the income tax imposed
by subsections (a) and (b) | ||||||
8 | of this Section and in addition to all other
occupation or | ||||||
9 | privilege taxes imposed by this State or by any municipal
| ||||||
10 | corporation or political subdivision thereof. | ||||||
11 | (d) Additional Personal Property Tax Replacement Income | ||||||
12 | Tax Rates.
The personal property tax replacement income tax | ||||||
13 | imposed by this subsection
and subsection (c) of this Section | ||||||
14 | in the case of a corporation, other
than a Subchapter S | ||||||
15 | corporation and except as adjusted by subsection (d-1),
shall | ||||||
16 | be an additional amount equal to
2.85% of such taxpayer's net | ||||||
17 | income for the taxable year, except that
beginning on January | ||||||
18 | 1, 1981, and thereafter, the rate of 2.85% specified
in this | ||||||
19 | subsection shall be reduced to 2.5%, and in the case of a
| ||||||
20 | partnership, trust or a Subchapter S corporation shall be an | ||||||
21 | additional
amount equal to 1.5% of such taxpayer's net income | ||||||
22 | for the taxable year. | ||||||
23 | (d-1) Rate reduction for certain foreign insurers. In the | ||||||
24 | case of a
foreign insurer, as defined by Section 35A-5 of the | ||||||
25 | Illinois Insurance Code,
whose state or country of domicile | ||||||
26 | imposes on insurers domiciled in Illinois
a retaliatory tax |
| |||||||
| |||||||
1 | (excluding any insurer
whose premiums from reinsurance assumed | ||||||
2 | are 50% or more of its total insurance
premiums as determined | ||||||
3 | under paragraph (2) of subsection (b) of Section 304,
except | ||||||
4 | that for purposes of this determination premiums from | ||||||
5 | reinsurance do
not include premiums from inter-affiliate | ||||||
6 | reinsurance arrangements),
beginning with taxable years ending | ||||||
7 | on or after December 31, 1999,
the sum of
the rates of tax | ||||||
8 | imposed by subsections (b) and (d) shall be reduced (but not
| ||||||
9 | increased) to the rate at which the total amount of tax imposed | ||||||
10 | under this Act,
net of all credits allowed under this Act, | ||||||
11 | shall equal (i) the total amount of
tax that would be imposed | ||||||
12 | on the foreign insurer's net income allocable to
Illinois for | ||||||
13 | the taxable year by such foreign insurer's state or country of
| ||||||
14 | domicile if that net income were subject to all income taxes | ||||||
15 | and taxes
measured by net income imposed by such foreign | ||||||
16 | insurer's state or country of
domicile, net of all credits | ||||||
17 | allowed or (ii) a rate of zero if no such tax is
imposed on | ||||||
18 | such income by the foreign insurer's state of domicile.
For | ||||||
19 | the purposes of this subsection (d-1), an inter-affiliate | ||||||
20 | includes a
mutual insurer under common management. | ||||||
21 | (1) For the purposes of subsection (d-1), in no event | ||||||
22 | shall the sum of the
rates of tax imposed by subsections | ||||||
23 | (b) and (d) be reduced below the rate at
which the sum of: | ||||||
24 | (A) the total amount of tax imposed on such | ||||||
25 | foreign insurer under
this Act for a taxable year, net | ||||||
26 | of all credits allowed under this Act, plus |
| |||||||
| |||||||
1 | (B) the privilege tax imposed by Section 409 of | ||||||
2 | the Illinois Insurance
Code, the fire insurance | ||||||
3 | company tax imposed by Section 12 of the Fire
| ||||||
4 | Investigation Act, and the fire department taxes | ||||||
5 | imposed under Section 11-10-1
of the Illinois | ||||||
6 | Municipal Code, | ||||||
7 | equals 1.25% for taxable years ending prior to December | ||||||
8 | 31, 2003, or
1.75% for taxable years ending on or after | ||||||
9 | December 31, 2003, of the net
taxable premiums written for | ||||||
10 | the taxable year,
as described by subsection (1) of | ||||||
11 | Section 409 of the Illinois Insurance Code.
This paragraph | ||||||
12 | will in no event increase the rates imposed under | ||||||
13 | subsections
(b) and (d). | ||||||
14 | (2) Any reduction in the rates of tax imposed by this | ||||||
15 | subsection shall be
applied first against the rates | ||||||
16 | imposed by subsection (b) and only after the
tax imposed | ||||||
17 | by subsection (a) net of all credits allowed under this | ||||||
18 | Section
other than the credit allowed under subsection (i) | ||||||
19 | has been reduced to zero,
against the rates imposed by | ||||||
20 | subsection (d). | ||||||
21 | This subsection (d-1) is exempt from the provisions of | ||||||
22 | Section 250. | ||||||
23 | (e) Investment credit. A taxpayer shall be allowed a | ||||||
24 | credit
against the Personal Property Tax Replacement Income | ||||||
25 | Tax for
investment in qualified property. | ||||||
26 | (1) A taxpayer shall be allowed a credit equal to .5% |
| |||||||
| |||||||
1 | of
the basis of qualified property placed in service | ||||||
2 | during the taxable year,
provided such property is placed | ||||||
3 | in service on or after
July 1, 1984. There shall be allowed | ||||||
4 | an additional credit equal
to .5% of the basis of | ||||||
5 | qualified property placed in service during the
taxable | ||||||
6 | year, provided such property is placed in service on or
| ||||||
7 | after July 1, 1986, and the taxpayer's base employment
| ||||||
8 | within Illinois has increased by 1% or more over the | ||||||
9 | preceding year as
determined by the taxpayer's employment | ||||||
10 | records filed with the
Illinois Department of Employment | ||||||
11 | Security. Taxpayers who are new to
Illinois shall be | ||||||
12 | deemed to have met the 1% growth in base employment for
the | ||||||
13 | first year in which they file employment records with the | ||||||
14 | Illinois
Department of Employment Security. The provisions | ||||||
15 | added to this Section by
Public Act 85-1200 (and restored | ||||||
16 | by Public Act 87-895) shall be
construed as declaratory of | ||||||
17 | existing law and not as a new enactment. If,
in any year, | ||||||
18 | the increase in base employment within Illinois over the
| ||||||
19 | preceding year is less than 1%, the additional credit | ||||||
20 | shall be limited to that
percentage times a fraction, the | ||||||
21 | numerator of which is .5% and the denominator
of which is | ||||||
22 | 1%, but shall not exceed .5%. The investment credit shall | ||||||
23 | not be
allowed to the extent that it would reduce a | ||||||
24 | taxpayer's liability in any tax
year below zero, nor may | ||||||
25 | any credit for qualified property be allowed for any
year | ||||||
26 | other than the year in which the property was placed in |
| |||||||
| |||||||
1 | service in
Illinois. For tax years ending on or after | ||||||
2 | December 31, 1987, and on or
before December 31, 1988, the | ||||||
3 | credit shall be allowed for the tax year in
which the | ||||||
4 | property is placed in service, or, if the amount of the | ||||||
5 | credit
exceeds the tax liability for that year, whether it | ||||||
6 | exceeds the original
liability or the liability as later | ||||||
7 | amended, such excess may be carried
forward and applied to | ||||||
8 | the tax liability of the 5 taxable years following
the | ||||||
9 | excess credit years if the taxpayer (i) makes investments | ||||||
10 | which cause
the creation of a minimum of 2,000 full-time | ||||||
11 | equivalent jobs in Illinois,
(ii) is located in an | ||||||
12 | enterprise zone established pursuant to the Illinois
| ||||||
13 | Enterprise Zone Act and (iii) is certified by the | ||||||
14 | Department of Commerce
and Community Affairs (now | ||||||
15 | Department of Commerce and Economic Opportunity) as | ||||||
16 | complying with the requirements specified in
clause (i) | ||||||
17 | and (ii) by July 1, 1986. The Department of Commerce and
| ||||||
18 | Community Affairs (now Department of Commerce and Economic | ||||||
19 | Opportunity) shall notify the Department of Revenue of all | ||||||
20 | such
certifications immediately. For tax years ending | ||||||
21 | after December 31, 1988,
the credit shall be allowed for | ||||||
22 | the tax year in which the property is
placed in service, | ||||||
23 | or, if the amount of the credit exceeds the tax
liability | ||||||
24 | for that year, whether it exceeds the original liability | ||||||
25 | or the
liability as later amended, such excess may be | ||||||
26 | carried forward and applied
to the tax liability of the 5 |
| |||||||
| |||||||
1 | taxable years following the excess credit
years. The | ||||||
2 | credit shall be applied to the earliest year for which | ||||||
3 | there is
a liability. If there is credit from more than one | ||||||
4 | tax year that is
available to offset a liability, earlier | ||||||
5 | credit shall be applied first. | ||||||
6 | (2) The term "qualified property" means property | ||||||
7 | which: | ||||||
8 | (A) is tangible, whether new or used, including | ||||||
9 | buildings and structural
components of buildings and | ||||||
10 | signs that are real property, but not including
land | ||||||
11 | or improvements to real property that are not a | ||||||
12 | structural component of a
building such as | ||||||
13 | landscaping, sewer lines, local access roads, fencing, | ||||||
14 | parking
lots, and other appurtenances; | ||||||
15 | (B) is depreciable pursuant to Section 167 of the | ||||||
16 | Internal Revenue Code,
except that "3-year property" | ||||||
17 | as defined in Section 168(c)(2)(A) of that
Code is not | ||||||
18 | eligible for the credit provided by this subsection | ||||||
19 | (e); | ||||||
20 | (C) is acquired by purchase as defined in Section | ||||||
21 | 179(d) of
the Internal Revenue Code; | ||||||
22 | (D) is used in Illinois by a taxpayer who is | ||||||
23 | primarily engaged in
manufacturing, or in mining coal | ||||||
24 | or fluorite, or in retailing, or was placed in service | ||||||
25 | on or after July 1, 2006 in a River Edge Redevelopment | ||||||
26 | Zone established pursuant to the River Edge |
| |||||||
| |||||||
1 | Redevelopment Zone Act; and | ||||||
2 | (E) has not previously been used in Illinois in | ||||||
3 | such a manner and by
such a person as would qualify for | ||||||
4 | the credit provided by this subsection
(e) or | ||||||
5 | subsection (f). | ||||||
6 | (3) For purposes of this subsection (e), | ||||||
7 | "manufacturing" means
the material staging and production | ||||||
8 | of tangible personal property by
procedures commonly | ||||||
9 | regarded as manufacturing, processing, fabrication, or
| ||||||
10 | assembling which changes some existing material into new | ||||||
11 | shapes, new
qualities, or new combinations. For purposes | ||||||
12 | of this subsection
(e) the term "mining" shall have the | ||||||
13 | same meaning as the term "mining" in
Section 613(c) of the | ||||||
14 | Internal Revenue Code. For purposes of this subsection
| ||||||
15 | (e), the term "retailing" means the sale of tangible | ||||||
16 | personal property for use or consumption and not for | ||||||
17 | resale, or
services rendered in conjunction with the sale | ||||||
18 | of tangible personal property for use or consumption and | ||||||
19 | not for resale. For purposes of this subsection (e), | ||||||
20 | "tangible personal property" has the same meaning as when | ||||||
21 | that term is used in the Retailers' Occupation Tax Act, | ||||||
22 | and, for taxable years ending after December 31, 2008, | ||||||
23 | does not include the generation, transmission, or | ||||||
24 | distribution of electricity. | ||||||
25 | (4) The basis of qualified property shall be the basis
| ||||||
26 | used to compute the depreciation deduction for federal |
| |||||||
| |||||||
1 | income tax purposes. | ||||||
2 | (5) If the basis of the property for federal income | ||||||
3 | tax depreciation
purposes is increased after it has been | ||||||
4 | placed in service in Illinois by
the taxpayer, the amount | ||||||
5 | of such increase shall be deemed property placed
in | ||||||
6 | service on the date of such increase in basis. | ||||||
7 | (6) The term "placed in service" shall have the same
| ||||||
8 | meaning as under Section 46 of the Internal Revenue Code. | ||||||
9 | (7) If during any taxable year, any property ceases to
| ||||||
10 | be qualified property in the hands of the taxpayer within | ||||||
11 | 48 months after
being placed in service, or the situs of | ||||||
12 | any qualified property is
moved outside Illinois within 48 | ||||||
13 | months after being placed in service, the
Personal | ||||||
14 | Property Tax Replacement Income Tax for such taxable year | ||||||
15 | shall be
increased. Such increase shall be determined by | ||||||
16 | (i) recomputing the
investment credit which would have | ||||||
17 | been allowed for the year in which
credit for such | ||||||
18 | property was originally allowed by eliminating such
| ||||||
19 | property from such computation and, (ii) subtracting such | ||||||
20 | recomputed credit
from the amount of credit previously | ||||||
21 | allowed. For the purposes of this
paragraph (7), a | ||||||
22 | reduction of the basis of qualified property resulting
| ||||||
23 | from a redetermination of the purchase price shall be | ||||||
24 | deemed a disposition
of qualified property to the extent | ||||||
25 | of such reduction. | ||||||
26 | (8) Unless the investment credit is extended by law, |
| |||||||
| |||||||
1 | the
basis of qualified property shall not include costs | ||||||
2 | incurred after
December 31, 2018, except for costs | ||||||
3 | incurred pursuant to a binding
contract entered into on or | ||||||
4 | before December 31, 2018. | ||||||
5 | (9) Each taxable year ending before December 31, 2000, | ||||||
6 | a partnership may
elect to pass through to its
partners | ||||||
7 | the credits to which the partnership is entitled under | ||||||
8 | this subsection
(e) for the taxable year. A partner may | ||||||
9 | use the credit allocated to him or her
under this | ||||||
10 | paragraph only against the tax imposed in subsections (c) | ||||||
11 | and (d) of
this Section. If the partnership makes that | ||||||
12 | election, those credits shall be
allocated among the | ||||||
13 | partners in the partnership in accordance with the rules
| ||||||
14 | set forth in Section 704(b) of the Internal Revenue Code, | ||||||
15 | and the rules
promulgated under that Section, and the | ||||||
16 | allocated amount of the credits shall
be allowed to the | ||||||
17 | partners for that taxable year. The partnership shall make
| ||||||
18 | this election on its Personal Property Tax Replacement | ||||||
19 | Income Tax return for
that taxable year. The election to | ||||||
20 | pass through the credits shall be
irrevocable. | ||||||
21 | For taxable years ending on or after December 31, | ||||||
22 | 2000, a
partner that qualifies its
partnership for a | ||||||
23 | subtraction under subparagraph (I) of paragraph (2) of
| ||||||
24 | subsection (d) of Section 203 or a shareholder that | ||||||
25 | qualifies a Subchapter S
corporation for a subtraction | ||||||
26 | under subparagraph (S) of paragraph (2) of
subsection (b) |
| |||||||
| |||||||
1 | of Section 203 shall be allowed a credit under this | ||||||
2 | subsection
(e) equal to its share of the credit earned | ||||||
3 | under this subsection (e) during
the taxable year by the | ||||||
4 | partnership or Subchapter S corporation, determined in
| ||||||
5 | accordance with the determination of income and | ||||||
6 | distributive share of
income under Sections 702 and 704 | ||||||
7 | and Subchapter S of the Internal Revenue
Code. This | ||||||
8 | paragraph is exempt from the provisions of Section 250. | ||||||
9 | (f) Investment credit; Enterprise Zone; River Edge | ||||||
10 | Redevelopment Zone. | ||||||
11 | (1) A taxpayer shall be allowed a credit against the | ||||||
12 | tax imposed
by subsections (a) and (b) of this Section for | ||||||
13 | investment in qualified
property which is placed in | ||||||
14 | service in an Enterprise Zone created
pursuant to the | ||||||
15 | Illinois Enterprise Zone Act or, for property placed in | ||||||
16 | service on or after July 1, 2006, a River Edge | ||||||
17 | Redevelopment Zone established pursuant to the River Edge | ||||||
18 | Redevelopment Zone Act. For partners, shareholders
of | ||||||
19 | Subchapter S corporations, and owners of limited liability | ||||||
20 | companies,
if the liability company is treated as a | ||||||
21 | partnership for purposes of
federal and State income | ||||||
22 | taxation, there shall be allowed a credit under
this | ||||||
23 | subsection (f) to be determined in accordance with the | ||||||
24 | determination
of income and distributive share of income | ||||||
25 | under Sections 702 and 704 and
Subchapter S of the | ||||||
26 | Internal Revenue Code. The credit shall be .5% of the
|
| |||||||
| |||||||
1 | basis for such property. The credit shall be available | ||||||
2 | only in the taxable
year in which the property is placed in | ||||||
3 | service in the Enterprise Zone or River Edge Redevelopment | ||||||
4 | Zone and
shall not be allowed to the extent that it would | ||||||
5 | reduce a taxpayer's
liability for the tax imposed by | ||||||
6 | subsections (a) and (b) of this Section to
below zero. For | ||||||
7 | tax years ending on or after December 31, 1985, the credit
| ||||||
8 | shall be allowed for the tax year in which the property is | ||||||
9 | placed in
service, or, if the amount of the credit exceeds | ||||||
10 | the tax liability for that
year, whether it exceeds the | ||||||
11 | original liability or the liability as later
amended, such | ||||||
12 | excess may be carried forward and applied to the tax
| ||||||
13 | liability of the 5 taxable years following the excess | ||||||
14 | credit year.
The credit shall be applied to the earliest | ||||||
15 | year for which there is a
liability. If there is credit | ||||||
16 | from more than one tax year that is available
to offset a | ||||||
17 | liability, the credit accruing first in time shall be | ||||||
18 | applied
first. | ||||||
19 | (2) The term qualified property means property which: | ||||||
20 | (A) is tangible, whether new or used, including | ||||||
21 | buildings and
structural components of buildings; | ||||||
22 | (B) is depreciable pursuant to Section 167 of the | ||||||
23 | Internal Revenue
Code, except that "3-year property" | ||||||
24 | as defined in Section 168(c)(2)(A) of
that Code is not | ||||||
25 | eligible for the credit provided by this subsection | ||||||
26 | (f); |
| |||||||
| |||||||
1 | (C) is acquired by purchase as defined in Section | ||||||
2 | 179(d) of
the Internal Revenue Code; | ||||||
3 | (D) is used in the Enterprise Zone or River Edge | ||||||
4 | Redevelopment Zone by the taxpayer; and | ||||||
5 | (E) has not been previously used in Illinois in | ||||||
6 | such a manner and by
such a person as would qualify for | ||||||
7 | the credit provided by this subsection
(f) or | ||||||
8 | subsection (e). | ||||||
9 | (3) The basis of qualified property shall be the basis | ||||||
10 | used to compute
the depreciation deduction for federal | ||||||
11 | income tax purposes. | ||||||
12 | (4) If the basis of the property for federal income | ||||||
13 | tax depreciation
purposes is increased after it has been | ||||||
14 | placed in service in the Enterprise
Zone or River Edge | ||||||
15 | Redevelopment Zone by the taxpayer, the amount of such | ||||||
16 | increase shall be deemed property
placed in service on the | ||||||
17 | date of such increase in basis. | ||||||
18 | (5) The term "placed in service" shall have the same | ||||||
19 | meaning as under
Section 46 of the Internal Revenue Code. | ||||||
20 | (6) If during any taxable year, any property ceases to | ||||||
21 | be qualified
property in the hands of the taxpayer within | ||||||
22 | 48 months after being placed
in service, or the situs of | ||||||
23 | any qualified property is moved outside the
Enterprise | ||||||
24 | Zone or River Edge Redevelopment Zone within 48 months | ||||||
25 | after being placed in service, the tax
imposed under | ||||||
26 | subsections (a) and (b) of this Section for such taxable |
| |||||||
| |||||||
1 | year
shall be increased. Such increase shall be determined | ||||||
2 | by (i) recomputing
the investment credit which would have | ||||||
3 | been allowed for the year in which
credit for such | ||||||
4 | property was originally allowed by eliminating such
| ||||||
5 | property from such computation, and (ii) subtracting such | ||||||
6 | recomputed credit
from the amount of credit previously | ||||||
7 | allowed. For the purposes of this
paragraph (6), a | ||||||
8 | reduction of the basis of qualified property resulting
| ||||||
9 | from a redetermination of the purchase price shall be | ||||||
10 | deemed a disposition
of qualified property to the extent | ||||||
11 | of such reduction. | ||||||
12 | (7) There shall be allowed an additional credit equal | ||||||
13 | to 0.5% of the basis of qualified property placed in | ||||||
14 | service during the taxable year in a River Edge | ||||||
15 | Redevelopment Zone, provided such property is placed in | ||||||
16 | service on or after July 1, 2006, and the taxpayer's base | ||||||
17 | employment within Illinois has increased by 1% or more | ||||||
18 | over the preceding year as determined by the taxpayer's | ||||||
19 | employment records filed with the Illinois Department of | ||||||
20 | Employment Security. Taxpayers who are new to Illinois | ||||||
21 | shall be deemed to have met the 1% growth in base | ||||||
22 | employment for the first year in which they file | ||||||
23 | employment records with the Illinois Department of | ||||||
24 | Employment Security. If, in any year, the increase in base | ||||||
25 | employment within Illinois over the preceding year is less | ||||||
26 | than 1%, the additional credit shall be limited to that |
| |||||||
| |||||||
1 | percentage times a fraction, the numerator of which is | ||||||
2 | 0.5% and the denominator of which is 1%, but shall not | ||||||
3 | exceed 0.5%.
| ||||||
4 | (8) For taxable years beginning on or after January 1, | ||||||
5 | 2021, there shall be allowed an Enterprise Zone | ||||||
6 | construction jobs credit against the taxes imposed under | ||||||
7 | subsections (a) and (b) of this Section as provided in | ||||||
8 | Section 13 of the Illinois Enterprise Zone Act. | ||||||
9 | The credit or credits may not reduce the taxpayer's | ||||||
10 | liability to less than zero. If the amount of the credit or | ||||||
11 | credits exceeds the taxpayer's liability, the excess may | ||||||
12 | be carried forward and applied against the taxpayer's | ||||||
13 | liability in succeeding calendar years in the same manner | ||||||
14 | provided under paragraph (4) of Section 211 of this Act. | ||||||
15 | The credit or credits shall be applied to the earliest | ||||||
16 | year for which there is a tax liability. If there are | ||||||
17 | credits from more than one taxable year that are available | ||||||
18 | to offset a liability, the earlier credit shall be applied | ||||||
19 | first. | ||||||
20 | For partners, shareholders of Subchapter S | ||||||
21 | corporations, and owners of limited liability companies, | ||||||
22 | if the liability company is treated as a partnership for | ||||||
23 | the purposes of federal and State income taxation, there | ||||||
24 | shall be allowed a credit under this Section to be | ||||||
25 | determined in accordance with the determination of income | ||||||
26 | and distributive share of income under Sections 702 and |
| |||||||
| |||||||
1 | 704 and Subchapter S of the Internal Revenue Code. | ||||||
2 | The total aggregate amount of credits awarded under | ||||||
3 | the Blue Collar Jobs Act (Article 20 of Public Act 101-9) | ||||||
4 | shall not exceed $20,000,000 in any State fiscal year. | ||||||
5 | This paragraph (8) is exempt from the provisions of | ||||||
6 | Section 250. | ||||||
7 | (g) (Blank). | ||||||
8 | (h) Investment credit; High Impact Business. | ||||||
9 | (1) Subject to subsections (b) and (b-5) of Section
| ||||||
10 | 5.5 of the Illinois Enterprise Zone Act, a taxpayer shall | ||||||
11 | be allowed a credit
against the tax imposed by subsections | ||||||
12 | (a) and (b) of this Section for
investment in qualified
| ||||||
13 | property which is placed in service by a Department of | ||||||
14 | Commerce and Economic Opportunity
designated High Impact | ||||||
15 | Business. The credit shall be .5% of the basis
for such | ||||||
16 | property. The credit shall not be available (i) until the | ||||||
17 | minimum
investments in qualified property set forth in | ||||||
18 | subdivision (a)(3)(A) of
Section 5.5 of the Illinois
| ||||||
19 | Enterprise Zone Act have been satisfied
or (ii) until the | ||||||
20 | time authorized in subsection (b-5) of the Illinois
| ||||||
21 | Enterprise Zone Act for entities designated as High Impact | ||||||
22 | Businesses under
subdivisions (a)(3)(B), (a)(3)(C), and | ||||||
23 | (a)(3)(D) of Section 5.5 of the Illinois
Enterprise Zone | ||||||
24 | Act, and shall not be allowed to the extent that it would
| ||||||
25 | reduce a taxpayer's liability for the tax imposed by | ||||||
26 | subsections (a) and (b) of
this Section to below zero. The |
| |||||||
| |||||||
1 | credit applicable to such investments shall be
taken in | ||||||
2 | the taxable year in which such investments have been | ||||||
3 | completed. The
credit for additional investments beyond | ||||||
4 | the minimum investment by a designated
high impact | ||||||
5 | business authorized under subdivision (a)(3)(A) of Section | ||||||
6 | 5.5 of
the Illinois Enterprise Zone Act shall be available | ||||||
7 | only in the taxable year in
which the property is placed in | ||||||
8 | service and shall not be allowed to the extent
that it | ||||||
9 | would reduce a taxpayer's liability for the tax imposed by | ||||||
10 | subsections
(a) and (b) of this Section to below zero.
For | ||||||
11 | tax years ending on or after December 31, 1987, the credit | ||||||
12 | shall be
allowed for the tax year in which the property is | ||||||
13 | placed in service, or, if
the amount of the credit exceeds | ||||||
14 | the tax liability for that year, whether
it exceeds the | ||||||
15 | original liability or the liability as later amended, such
| ||||||
16 | excess may be carried forward and applied to the tax | ||||||
17 | liability of the 5
taxable years following the excess | ||||||
18 | credit year. The credit shall be
applied to the earliest | ||||||
19 | year for which there is a liability. If there is
credit | ||||||
20 | from more than one tax year that is available to offset a | ||||||
21 | liability,
the credit accruing first in time shall be | ||||||
22 | applied first. | ||||||
23 | Changes made in this subdivision (h)(1) by Public Act | ||||||
24 | 88-670
restore changes made by Public Act 85-1182 and | ||||||
25 | reflect existing law. | ||||||
26 | (2) The term qualified property means property which: |
| |||||||
| |||||||
1 | (A) is tangible, whether new or used, including | ||||||
2 | buildings and
structural components of buildings; | ||||||
3 | (B) is depreciable pursuant to Section 167 of the | ||||||
4 | Internal Revenue
Code, except that "3-year property" | ||||||
5 | as defined in Section 168(c)(2)(A) of
that Code is not | ||||||
6 | eligible for the credit provided by this subsection | ||||||
7 | (h); | ||||||
8 | (C) is acquired by purchase as defined in Section | ||||||
9 | 179(d) of the
Internal Revenue Code; and | ||||||
10 | (D) is not eligible for the Enterprise Zone | ||||||
11 | Investment Credit provided
by subsection (f) of this | ||||||
12 | Section. | ||||||
13 | (3) The basis of qualified property shall be the basis | ||||||
14 | used to compute
the depreciation deduction for federal | ||||||
15 | income tax purposes. | ||||||
16 | (4) If the basis of the property for federal income | ||||||
17 | tax depreciation
purposes is increased after it has been | ||||||
18 | placed in service in a federally
designated Foreign Trade | ||||||
19 | Zone or Sub-Zone located in Illinois by the taxpayer,
the | ||||||
20 | amount of such increase shall be deemed property placed in | ||||||
21 | service on
the date of such increase in basis. | ||||||
22 | (5) The term "placed in service" shall have the same | ||||||
23 | meaning as under
Section 46 of the Internal Revenue Code. | ||||||
24 | (6) If during any taxable year ending on or before | ||||||
25 | December 31, 1996,
any property ceases to be qualified
| ||||||
26 | property in the hands of the taxpayer within 48 months |
| |||||||
| |||||||
1 | after being placed
in service, or the situs of any | ||||||
2 | qualified property is moved outside
Illinois within 48 | ||||||
3 | months after being placed in service, the tax imposed
| ||||||
4 | under subsections (a) and (b) of this Section for such | ||||||
5 | taxable year shall
be increased. Such increase shall be | ||||||
6 | determined by (i) recomputing the
investment credit which | ||||||
7 | would have been allowed for the year in which
credit for | ||||||
8 | such property was originally allowed by eliminating such
| ||||||
9 | property from such computation, and (ii) subtracting such | ||||||
10 | recomputed credit
from the amount of credit previously | ||||||
11 | allowed. For the purposes of this
paragraph (6), a | ||||||
12 | reduction of the basis of qualified property resulting
| ||||||
13 | from a redetermination of the purchase price shall be | ||||||
14 | deemed a disposition
of qualified property to the extent | ||||||
15 | of such reduction. | ||||||
16 | (7) Beginning with tax years ending after December 31, | ||||||
17 | 1996, if a
taxpayer qualifies for the credit under this | ||||||
18 | subsection (h) and thereby is
granted a tax abatement and | ||||||
19 | the taxpayer relocates its entire facility in
violation of | ||||||
20 | the explicit terms and length of the contract under | ||||||
21 | Section
18-183 of the Property Tax Code, the tax imposed | ||||||
22 | under subsections
(a) and (b) of this Section shall be | ||||||
23 | increased for the taxable year
in which the taxpayer | ||||||
24 | relocated its facility by an amount equal to the
amount of | ||||||
25 | credit received by the taxpayer under this subsection (h). | ||||||
26 | (h-5) High Impact Business construction jobs credit. For |
| |||||||
| |||||||
1 | taxable years beginning on or after January 1, 2021, there | ||||||
2 | shall also be allowed a High Impact Business construction jobs | ||||||
3 | credit against the tax imposed under subsections (a) and (b) | ||||||
4 | of this Section as provided in subsections (i) and (j) of | ||||||
5 | Section 5.5 of the Illinois Enterprise Zone Act. | ||||||
6 | The credit or credits may not reduce the taxpayer's | ||||||
7 | liability to less than zero. If the amount of the credit or | ||||||
8 | credits exceeds the taxpayer's liability, the excess may be | ||||||
9 | carried forward and applied against the taxpayer's liability | ||||||
10 | in succeeding calendar years in the manner provided under | ||||||
11 | paragraph (4) of Section 211 of this Act. The credit or credits | ||||||
12 | shall be applied to the earliest year for which there is a tax | ||||||
13 | liability. If there are credits from more than one taxable | ||||||
14 | year that are available to offset a liability, the earlier | ||||||
15 | credit shall be applied first. | ||||||
16 | For partners, shareholders of Subchapter S corporations, | ||||||
17 | and owners of limited liability companies, if the liability | ||||||
18 | company is treated as a partnership for the purposes of | ||||||
19 | federal and State income taxation, there shall be allowed a | ||||||
20 | credit under this Section to be determined in accordance with | ||||||
21 | the determination of income and distributive share of income | ||||||
22 | under Sections 702 and 704 and Subchapter S of the Internal | ||||||
23 | Revenue Code. | ||||||
24 | The total aggregate amount of credits awarded under the | ||||||
25 | Blue Collar Jobs Act (Article 20 of Public Act 101-9) shall not | ||||||
26 | exceed $20,000,000 in any State fiscal year. |
| |||||||
| |||||||
1 | This subsection (h-5) is exempt from the provisions of | ||||||
2 | Section 250. | ||||||
3 | (i) Credit for Personal Property Tax Replacement Income | ||||||
4 | Tax.
For tax years ending prior to December 31, 2003, a credit | ||||||
5 | shall be allowed
against the tax imposed by
subsections (a) | ||||||
6 | and (b) of this Section for the tax imposed by subsections (c)
| ||||||
7 | and (d) of this Section. This credit shall be computed by | ||||||
8 | multiplying the tax
imposed by subsections (c) and (d) of this | ||||||
9 | Section by a fraction, the numerator
of which is base income | ||||||
10 | allocable to Illinois and the denominator of which is
Illinois | ||||||
11 | base income, and further multiplying the product by the tax | ||||||
12 | rate
imposed by subsections (a) and (b) of this Section. | ||||||
13 | Any credit earned on or after December 31, 1986 under
this | ||||||
14 | subsection which is unused in the year
the credit is computed | ||||||
15 | because it exceeds the tax liability imposed by
subsections | ||||||
16 | (a) and (b) for that year (whether it exceeds the original
| ||||||
17 | liability or the liability as later amended) may be carried | ||||||
18 | forward and
applied to the tax liability imposed by | ||||||
19 | subsections (a) and (b) of the 5
taxable years following the | ||||||
20 | excess credit year, provided that no credit may
be carried | ||||||
21 | forward to any year ending on or
after December 31, 2003. This | ||||||
22 | credit shall be
applied first to the earliest year for which | ||||||
23 | there is a liability. If
there is a credit under this | ||||||
24 | subsection from more than one tax year that is
available to | ||||||
25 | offset a liability the earliest credit arising under this
| ||||||
26 | subsection shall be applied first. |
| |||||||
| |||||||
1 | If, during any taxable year ending on or after December | ||||||
2 | 31, 1986, the
tax imposed by subsections (c) and (d) of this | ||||||
3 | Section for which a taxpayer
has claimed a credit under this | ||||||
4 | subsection (i) is reduced, the amount of
credit for such tax | ||||||
5 | shall also be reduced. Such reduction shall be
determined by | ||||||
6 | recomputing the credit to take into account the reduced tax
| ||||||
7 | imposed by subsections (c) and (d). If any portion of the
| ||||||
8 | reduced amount of credit has been carried to a different | ||||||
9 | taxable year, an
amended return shall be filed for such | ||||||
10 | taxable year to reduce the amount of
credit claimed. | ||||||
11 | (j) Training expense credit. Beginning with tax years | ||||||
12 | ending on or
after December 31, 1986 and prior to December 31, | ||||||
13 | 2003, a taxpayer shall be
allowed a credit against the
tax | ||||||
14 | imposed by subsections (a) and (b) under this Section
for all | ||||||
15 | amounts paid or accrued, on behalf of all persons
employed by | ||||||
16 | the taxpayer in Illinois or Illinois residents employed
| ||||||
17 | outside of Illinois by a taxpayer, for educational or | ||||||
18 | vocational training in
semi-technical or technical fields or | ||||||
19 | semi-skilled or skilled fields, which
were deducted from gross | ||||||
20 | income in the computation of taxable income. The
credit | ||||||
21 | against the tax imposed by subsections (a) and (b) shall be | ||||||
22 | 1.6% of
such training expenses. For partners, shareholders of | ||||||
23 | subchapter S
corporations, and owners of limited liability | ||||||
24 | companies, if the liability
company is treated as a | ||||||
25 | partnership for purposes of federal and State income
taxation, | ||||||
26 | there shall be allowed a credit under this subsection (j) to be
|
| |||||||
| |||||||
1 | determined in accordance with the determination of income and | ||||||
2 | distributive
share of income under Sections 702 and 704 and | ||||||
3 | subchapter S of the Internal
Revenue Code. | ||||||
4 | Any credit allowed under this subsection which is unused | ||||||
5 | in the year
the credit is earned may be carried forward to each | ||||||
6 | of the 5 taxable
years following the year for which the credit | ||||||
7 | is first computed until it is
used. This credit shall be | ||||||
8 | applied first to the earliest year for which
there is a | ||||||
9 | liability. If there is a credit under this subsection from | ||||||
10 | more
than one tax year that is available to offset a liability, | ||||||
11 | the earliest
credit arising under this subsection shall be | ||||||
12 | applied first. No carryforward
credit may be claimed in any | ||||||
13 | tax year ending on or after
December 31, 2003. | ||||||
14 | (k) Research and development credit. For tax years ending | ||||||
15 | after July 1, 1990 and prior to
December 31, 2003, and | ||||||
16 | beginning again for tax years ending on or after December 31, | ||||||
17 | 2004, and ending prior to January 1, 2027, a taxpayer shall be
| ||||||
18 | allowed a credit against the tax imposed by subsections (a) | ||||||
19 | and (b) of this
Section for increasing research activities in | ||||||
20 | this State. The credit
allowed against the tax imposed by | ||||||
21 | subsections (a) and (b) shall be equal
to 6 1/2% of the | ||||||
22 | qualifying expenditures for increasing research activities
in | ||||||
23 | this State. For partners, shareholders of subchapter S | ||||||
24 | corporations, and
owners of limited liability companies, if | ||||||
25 | the liability company is treated as a
partnership for purposes | ||||||
26 | of federal and State income taxation, there shall be
allowed a |
| |||||||
| |||||||
1 | credit under this subsection to be determined in accordance | ||||||
2 | with the
determination of income and distributive share of | ||||||
3 | income under Sections 702 and
704 and subchapter S of the | ||||||
4 | Internal Revenue Code. | ||||||
5 | For purposes of this subsection, "qualifying expenditures" | ||||||
6 | means the
qualifying expenditures as defined for the federal | ||||||
7 | credit for increasing
research activities which would be | ||||||
8 | allowable under Section 41 of the
Internal Revenue Code and | ||||||
9 | which are conducted in this State, "qualifying
expenditures | ||||||
10 | for increasing research activities in this State" means the
| ||||||
11 | excess of qualifying expenditures for the taxable year in | ||||||
12 | which incurred
over qualifying expenditures for the base | ||||||
13 | period, "qualifying expenditures
for the base period" means | ||||||
14 | the average of the qualifying expenditures for
each year in | ||||||
15 | the base period, and "base period" means the 3 taxable years
| ||||||
16 | immediately preceding the taxable year for which the | ||||||
17 | determination is
being made. | ||||||
18 | Any credit in excess of the tax liability for the taxable | ||||||
19 | year
may be carried forward. A taxpayer may elect to have the
| ||||||
20 | unused credit shown on its final completed return carried over | ||||||
21 | as a credit
against the tax liability for the following 5 | ||||||
22 | taxable years or until it has
been fully used, whichever | ||||||
23 | occurs first; provided that no credit earned in a tax year | ||||||
24 | ending prior to December 31, 2003 may be carried forward to any | ||||||
25 | year ending on or after December 31, 2003. | ||||||
26 | If an unused credit is carried forward to a given year from |
| |||||||
| |||||||
1 | 2 or more
earlier years, that credit arising in the earliest | ||||||
2 | year will be applied
first against the tax liability for the | ||||||
3 | given year. If a tax liability for
the given year still | ||||||
4 | remains, the credit from the next earliest year will
then be | ||||||
5 | applied, and so on, until all credits have been used or no tax
| ||||||
6 | liability for the given year remains. Any remaining unused | ||||||
7 | credit or
credits then will be carried forward to the next | ||||||
8 | following year in which a
tax liability is incurred, except | ||||||
9 | that no credit can be carried forward to
a year which is more | ||||||
10 | than 5 years after the year in which the expense for
which the | ||||||
11 | credit is given was incurred. | ||||||
12 | No inference shall be drawn from Public Act 91-644 in | ||||||
13 | construing this Section for taxable years beginning before | ||||||
14 | January
1, 1999. | ||||||
15 | It is the intent of the General Assembly that the research | ||||||
16 | and development credit under this subsection (k) shall apply | ||||||
17 | continuously for all tax years ending on or after December 31, | ||||||
18 | 2004 and ending prior to January 1, 2027, including, but not | ||||||
19 | limited to, the period beginning on January 1, 2016 and ending | ||||||
20 | on July 6, 2017 (the effective date of Public Act 100-22). All | ||||||
21 | actions taken in reliance on the continuation of the credit | ||||||
22 | under this subsection (k) by any taxpayer are hereby | ||||||
23 | validated. | ||||||
24 | (l) Environmental Remediation Tax Credit. | ||||||
25 | (i) For tax years ending after December 31, 1997 and | ||||||
26 | on or before
December 31, 2001, a taxpayer shall be |
| |||||||
| |||||||
1 | allowed a credit against the tax
imposed by subsections | ||||||
2 | (a) and (b) of this Section for certain amounts paid
for | ||||||
3 | unreimbursed eligible remediation costs, as specified in | ||||||
4 | this subsection.
For purposes of this Section, | ||||||
5 | "unreimbursed eligible remediation costs" means
costs | ||||||
6 | approved by the Illinois Environmental Protection Agency | ||||||
7 | ("Agency") under
Section 58.14 of the Environmental | ||||||
8 | Protection Act that were paid in performing
environmental | ||||||
9 | remediation at a site for which a No Further Remediation | ||||||
10 | Letter
was issued by the Agency and recorded under Section | ||||||
11 | 58.10 of the Environmental
Protection Act. The credit must | ||||||
12 | be claimed for the taxable year in which
Agency approval | ||||||
13 | of the eligible remediation costs is granted. The credit | ||||||
14 | is
not available to any taxpayer if the taxpayer or any | ||||||
15 | related party caused or
contributed to, in any material | ||||||
16 | respect, a release of regulated substances on,
in, or | ||||||
17 | under the site that was identified and addressed by the | ||||||
18 | remedial
action pursuant to the Site Remediation Program | ||||||
19 | of the Environmental Protection
Act. After the Pollution | ||||||
20 | Control Board rules are adopted pursuant to the
Illinois | ||||||
21 | Administrative Procedure Act for the administration and | ||||||
22 | enforcement of
Section 58.9 of the Environmental | ||||||
23 | Protection Act, determinations as to credit
availability | ||||||
24 | for purposes of this Section shall be made consistent with | ||||||
25 | those
rules. For purposes of this Section, "taxpayer" | ||||||
26 | includes a person whose tax
attributes the taxpayer has |
| |||||||
| |||||||
1 | succeeded to under Section 381 of the Internal
Revenue | ||||||
2 | Code and "related party" includes the persons disallowed a | ||||||
3 | deduction
for losses by paragraphs (b), (c), and (f)(1) of | ||||||
4 | Section 267 of the Internal
Revenue Code by virtue of | ||||||
5 | being a related taxpayer, as well as any of its
partners. | ||||||
6 | The credit allowed against the tax imposed by subsections | ||||||
7 | (a) and
(b) shall be equal to 25% of the unreimbursed | ||||||
8 | eligible remediation costs in
excess of $100,000 per site, | ||||||
9 | except that the $100,000 threshold shall not apply
to any | ||||||
10 | site contained in an enterprise zone as determined by the | ||||||
11 | Department of
Commerce and Community Affairs (now | ||||||
12 | Department of Commerce and Economic Opportunity). The | ||||||
13 | total credit allowed shall not exceed
$40,000 per year | ||||||
14 | with a maximum total of $150,000 per site. For partners | ||||||
15 | and
shareholders of subchapter S corporations, there shall | ||||||
16 | be allowed a credit
under this subsection to be determined | ||||||
17 | in accordance with the determination of
income and | ||||||
18 | distributive share of income under Sections 702 and 704 | ||||||
19 | and
subchapter S of the Internal Revenue Code. | ||||||
20 | (ii) A credit allowed under this subsection that is | ||||||
21 | unused in the year
the credit is earned may be carried | ||||||
22 | forward to each of the 5 taxable years
following the year | ||||||
23 | for which the credit is first earned until it is used.
The | ||||||
24 | term "unused credit" does not include any amounts of | ||||||
25 | unreimbursed eligible
remediation costs in excess of the | ||||||
26 | maximum credit per site authorized under
paragraph (i). |
| |||||||
| |||||||
1 | This credit shall be applied first to the earliest year
| ||||||
2 | for which there is a liability. If there is a credit under | ||||||
3 | this subsection
from more than one tax year that is | ||||||
4 | available to offset a liability, the
earliest credit | ||||||
5 | arising under this subsection shall be applied first. A
| ||||||
6 | credit allowed under this subsection may be sold to a | ||||||
7 | buyer as part of a sale
of all or part of the remediation | ||||||
8 | site for which the credit was granted. The
purchaser of a | ||||||
9 | remediation site and the tax credit shall succeed to the | ||||||
10 | unused
credit and remaining carry-forward period of the | ||||||
11 | seller. To perfect the
transfer, the assignor shall record | ||||||
12 | the transfer in the chain of title for the
site and provide | ||||||
13 | written notice to the Director of the Illinois Department | ||||||
14 | of
Revenue of the assignor's intent to sell the | ||||||
15 | remediation site and the amount of
the tax credit to be | ||||||
16 | transferred as a portion of the sale. In no event may a
| ||||||
17 | credit be transferred to any taxpayer if the taxpayer or a | ||||||
18 | related party would
not be eligible under the provisions | ||||||
19 | of subsection (i). | ||||||
20 | (iii) For purposes of this Section, the term "site" | ||||||
21 | shall have the same
meaning as under Section 58.2 of the | ||||||
22 | Environmental Protection Act. | ||||||
23 | (m) Education expense credit. Beginning with tax years | ||||||
24 | ending after
December 31, 1999, a taxpayer who
is the | ||||||
25 | custodian of one or more qualifying pupils shall be allowed a | ||||||
26 | credit
against the tax imposed by subsections (a) and (b) of |
| |||||||
| |||||||
1 | this Section for
qualified education expenses incurred on | ||||||
2 | behalf of the qualifying pupils.
The credit shall be equal to | ||||||
3 | 25% of qualified education expenses, but in no
event may the | ||||||
4 | total credit under this subsection claimed by a
family that is | ||||||
5 | the
custodian of qualifying pupils exceed (i) $500 for tax | ||||||
6 | years ending prior to December 31, 2017, and (ii) $750 for tax | ||||||
7 | years ending on or after December 31, 2017. In no event shall a | ||||||
8 | credit under
this subsection reduce the taxpayer's liability | ||||||
9 | under this Act to less than
zero. Notwithstanding any other | ||||||
10 | provision of law, for taxable years beginning on or after | ||||||
11 | January 1, 2017, no taxpayer may claim a credit under this | ||||||
12 | subsection (m) if the taxpayer's adjusted gross income for the | ||||||
13 | taxable year exceeds (i) $500,000, in the case of spouses | ||||||
14 | filing a joint federal tax return or (ii) $250,000, in the case | ||||||
15 | of all other taxpayers. This subsection is exempt from the | ||||||
16 | provisions of Section 250 of this
Act. | ||||||
17 | For purposes of this subsection: | ||||||
18 | "Qualifying pupils" means individuals who (i) are | ||||||
19 | residents of the State of
Illinois, (ii) are under the age of | ||||||
20 | 21 at the close of the school year for
which a credit is | ||||||
21 | sought, and (iii) during the school year for which a credit
is | ||||||
22 | sought were full-time pupils enrolled in a kindergarten | ||||||
23 | through twelfth
grade education program at any school, as | ||||||
24 | defined in this subsection. | ||||||
25 | "Qualified education expense" means the amount incurred
on | ||||||
26 | behalf of a qualifying pupil in excess of $250 for tuition, |
| |||||||
| |||||||
1 | book fees, and
lab fees at the school in which the pupil is | ||||||
2 | enrolled during the regular school
year. | ||||||
3 | "School" means any public or nonpublic elementary or | ||||||
4 | secondary school in
Illinois that is in compliance with Title | ||||||
5 | VI of the Civil Rights Act of 1964
and attendance at which | ||||||
6 | satisfies the requirements of Section 26-1 of the
School Code, | ||||||
7 | except that nothing shall be construed to require a child to
| ||||||
8 | attend any particular public or nonpublic school to qualify | ||||||
9 | for the credit
under this Section. | ||||||
10 | "Custodian" means, with respect to qualifying pupils, an | ||||||
11 | Illinois resident
who is a parent, the parents, a legal | ||||||
12 | guardian, or the legal guardians of the
qualifying pupils. | ||||||
13 | (n) River Edge Redevelopment Zone site remediation tax | ||||||
14 | credit.
| ||||||
15 | (i) For tax years ending on or after December 31, | ||||||
16 | 2006, a taxpayer shall be allowed a credit against the tax | ||||||
17 | imposed by subsections (a) and (b) of this Section for | ||||||
18 | certain amounts paid for unreimbursed eligible remediation | ||||||
19 | costs, as specified in this subsection. For purposes of | ||||||
20 | this Section, "unreimbursed eligible remediation costs" | ||||||
21 | means costs approved by the Illinois Environmental | ||||||
22 | Protection Agency ("Agency") under Section 58.14a of the | ||||||
23 | Environmental Protection Act that were paid in performing | ||||||
24 | environmental remediation at a site within a River Edge | ||||||
25 | Redevelopment Zone for which a No Further Remediation | ||||||
26 | Letter was issued by the Agency and recorded under Section |
| |||||||
| |||||||
1 | 58.10 of the Environmental Protection Act. The credit must | ||||||
2 | be claimed for the taxable year in which Agency approval | ||||||
3 | of the eligible remediation costs is granted. The credit | ||||||
4 | is not available to any taxpayer if the taxpayer or any | ||||||
5 | related party caused or contributed to, in any material | ||||||
6 | respect, a release of regulated substances on, in, or | ||||||
7 | under the site that was identified and addressed by the | ||||||
8 | remedial action pursuant to the Site Remediation Program | ||||||
9 | of the Environmental Protection Act. Determinations as to | ||||||
10 | credit availability for purposes of this Section shall be | ||||||
11 | made consistent with rules adopted by the Pollution | ||||||
12 | Control Board pursuant to the Illinois Administrative | ||||||
13 | Procedure Act for the administration and enforcement of | ||||||
14 | Section 58.9 of the Environmental Protection Act. For | ||||||
15 | purposes of this Section, "taxpayer" includes a person | ||||||
16 | whose tax attributes the taxpayer has succeeded to under | ||||||
17 | Section 381 of the Internal Revenue Code and "related | ||||||
18 | party" includes the persons disallowed a deduction for | ||||||
19 | losses by paragraphs (b), (c), and (f)(1) of Section 267 | ||||||
20 | of the Internal Revenue Code by virtue of being a related | ||||||
21 | taxpayer, as well as any of its partners. The credit | ||||||
22 | allowed against the tax imposed by subsections (a) and (b) | ||||||
23 | shall be equal to 25% of the unreimbursed eligible | ||||||
24 | remediation costs in excess of $100,000 per site. | ||||||
25 | (ii) A credit allowed under this subsection that is | ||||||
26 | unused in the year the credit is earned may be carried |
| |||||||
| |||||||
1 | forward to each of the 5 taxable years following the year | ||||||
2 | for which the credit is first earned until it is used. This | ||||||
3 | credit shall be applied first to the earliest year for | ||||||
4 | which there is a liability. If there is a credit under this | ||||||
5 | subsection from more than one tax year that is available | ||||||
6 | to offset a liability, the earliest credit arising under | ||||||
7 | this subsection shall be applied first. A credit allowed | ||||||
8 | under this subsection may be sold to a buyer as part of a | ||||||
9 | sale of all or part of the remediation site for which the | ||||||
10 | credit was granted. The purchaser of a remediation site | ||||||
11 | and the tax credit shall succeed to the unused credit and | ||||||
12 | remaining carry-forward period of the seller. To perfect | ||||||
13 | the transfer, the assignor shall record the transfer in | ||||||
14 | the chain of title for the site and provide written notice | ||||||
15 | to the Director of the Illinois Department of Revenue of | ||||||
16 | the assignor's intent to sell the remediation site and the | ||||||
17 | amount of the tax credit to be transferred as a portion of | ||||||
18 | the sale. In no event may a credit be transferred to any | ||||||
19 | taxpayer if the taxpayer or a related party would not be | ||||||
20 | eligible under the provisions of subsection (i). | ||||||
21 | (iii) For purposes of this Section, the term "site" | ||||||
22 | shall have the same meaning as under Section 58.2 of the | ||||||
23 | Environmental Protection Act. | ||||||
24 | (n-5) For taxable years beginning on or after the earlier | ||||||
25 | of: (i) January 1, 2025; or (ii) January 1 of the calendar year | ||||||
26 | immediately following the calendar year in which the State |
| |||||||
| |||||||
1 | reports to the United States Department of the Treasury that | ||||||
2 | all federal funds received under the American Rescue Plan Act | ||||||
3 | of 2021 have been fully expended, a taxpayer shall be allowed | ||||||
4 | an annual credit against the tax imposed by subsections (a) | ||||||
5 | and (b) of this Section of an amount equal to 15% of the cost | ||||||
6 | of equipment and materials incorporated into or used in the | ||||||
7 | business of providing broadband services in a county in the | ||||||
8 | State with a population of fewer than 40,000 people or a | ||||||
9 | township in the State with a population density of less than 50 | ||||||
10 | households per square mile in a county with a population of | ||||||
11 | less than 300,000 people during that year. For partners, | ||||||
12 | shareholders of Subchapter S corporations, and owners of | ||||||
13 | limited liability companies, if the liability company is | ||||||
14 | treated as a partnership for purposes of federal and State | ||||||
15 | income taxation, there shall be allowed a credit under this | ||||||
16 | subsection to be determined in accordance with the | ||||||
17 | determination of income and distributive share of income under | ||||||
18 | Sections 702 and 704 and Subchapter S of the Internal Revenue | ||||||
19 | Code. Such annual credits shall be allowed commencing with the | ||||||
20 | taxable year in which such property is placed in service and | ||||||
21 | continue for 9 consecutive years thereafter. The aggregate | ||||||
22 | credit established by the subsection taken in any one tax year | ||||||
23 | shall not reduce taxpayer's tax liability under subsections | ||||||
24 | (a) and (b) of Section 201 by more than 50%; provided, however, | ||||||
25 | that any tax credit claimed under this subsection but not used | ||||||
26 | in any taxable year may be carried forward for 10 consecutive |
| |||||||
| |||||||
1 | years from the close of the tax year in which the credits were | ||||||
2 | earned. The maximum aggregate amount of credits that may be | ||||||
3 | claimed under this subsection shall not exceed the original | ||||||
4 | investment made by the taxpayer in the qualifying equipment. | ||||||
5 | For purposes this subsection: (i) "broadband service" | ||||||
6 | means a service provided by wireline or wireless means capable | ||||||
7 | of delivering high-speed internet access at speeds of at least | ||||||
8 | 25 megabits per second of download speed and 3 megabits per | ||||||
9 | second of upload speed; and (ii) "equipment, and materials | ||||||
10 | incorporated into or used in the business of providing | ||||||
11 | broadband services", means all equipment and materials | ||||||
12 | machinery, software, or other tangible personal property | ||||||
13 | deployed in Illinois on or after January 1, 2023 that is used | ||||||
14 | in whole or in part in producing, broadcasting, distributing, | ||||||
15 | sending, receiving, storing, transmitting, retransmitting, | ||||||
16 | amplifying, switching, or routing broadband services, | ||||||
17 | including the monitoring, testing, maintaining, enabling, or | ||||||
18 | facilitating of such equipment, machinery, software, or other | ||||||
19 | infrastructure. Such property includes, but is not limited to, | ||||||
20 | wires, cables including fiber optic cables, antennas, poles, | ||||||
21 | switches, routers, amplifiers, rectifiers, repeaters, | ||||||
22 | receivers, multiplexers, duplexers, transmitters, power | ||||||
23 | equipment, backup power equipment, diagnostic equipment, | ||||||
24 | storage devices, modems, and other general central office | ||||||
25 | equipment, such as channel cards, frames, and cabinets. | ||||||
26 | The Department may award no more than $25,000,000 in |
| |||||||
| |||||||
1 | credits under this subsection (n-5) in any taxable year. The | ||||||
2 | credit under this subsection (n-5) may be taken for property | ||||||
3 | placed in service on or after January 1, 2023; however, the | ||||||
4 | credit may not be taken until a taxable year beginning on or | ||||||
5 | after the earlier of: (i) January 1, 2025; or (ii) January 1 of | ||||||
6 | the calendar year immediately following the calendar year in | ||||||
7 | which the State reports to the United States Department of the | ||||||
8 | Treasury that all federal funds received under the American | ||||||
9 | Rescue Plan Act of 2021 have been fully expended. The credit | ||||||
10 | under this subsection (n-5) does not apply to property placed | ||||||
11 | in service on or after December 31 of the seventh calendar year | ||||||
12 | to occur after the earlier of: (i) January 1, 2025; or (ii) | ||||||
13 | January 1 of the calendar year immediately following the | ||||||
14 | calendar year in which the State reports to the United States | ||||||
15 | Department of the Treasury that all federal funds received | ||||||
16 | under the American Rescue Plan Act of 2021 have been fully | ||||||
17 | expended. | ||||||
18 | (o) For each of taxable years during the Compassionate Use | ||||||
19 | of Medical Cannabis Program, a surcharge is imposed on all | ||||||
20 | taxpayers on income arising from the sale or exchange of | ||||||
21 | capital assets, depreciable business property, real property | ||||||
22 | used in the trade or business, and Section 197 intangibles of | ||||||
23 | an organization registrant under the Compassionate Use of | ||||||
24 | Medical Cannabis Program Act. The amount of the surcharge is | ||||||
25 | equal to the amount of federal income tax liability for the | ||||||
26 | taxable year attributable to those sales and exchanges. The |
| |||||||
| |||||||
1 | surcharge imposed does not apply if: | ||||||
2 | (1) the medical cannabis cultivation center | ||||||
3 | registration, medical cannabis dispensary registration, or | ||||||
4 | the property of a registration is transferred as a result | ||||||
5 | of any of the following: | ||||||
6 | (A) bankruptcy, a receivership, or a debt | ||||||
7 | adjustment initiated by or against the initial | ||||||
8 | registration or the substantial owners of the initial | ||||||
9 | registration; | ||||||
10 | (B) cancellation, revocation, or termination of | ||||||
11 | any registration by the Illinois Department of Public | ||||||
12 | Health; | ||||||
13 | (C) a determination by the Illinois Department of | ||||||
14 | Public Health that transfer of the registration is in | ||||||
15 | the best interests of Illinois qualifying patients as | ||||||
16 | defined by the Compassionate Use of Medical Cannabis | ||||||
17 | Program Act; | ||||||
18 | (D) the death of an owner of the equity interest in | ||||||
19 | a registrant; | ||||||
20 | (E) the acquisition of a controlling interest in | ||||||
21 | the stock or substantially all of the assets of a | ||||||
22 | publicly traded company; | ||||||
23 | (F) a transfer by a parent company to a wholly | ||||||
24 | owned subsidiary; or | ||||||
25 | (G) the transfer or sale to or by one person to | ||||||
26 | another person where both persons were initial owners |
| |||||||
| |||||||
1 | of the registration when the registration was issued; | ||||||
2 | or | ||||||
3 | (2) the cannabis cultivation center registration, | ||||||
4 | medical cannabis dispensary registration, or the | ||||||
5 | controlling interest in a registrant's property is | ||||||
6 | transferred in a transaction to lineal descendants in | ||||||
7 | which no gain or loss is recognized or as a result of a | ||||||
8 | transaction in accordance with Section 351 of the Internal | ||||||
9 | Revenue Code in which no gain or loss is recognized. | ||||||
10 | (p) Pass-through entity tax. | ||||||
11 | (1) For taxable years ending on or after December 31, | ||||||
12 | 2021 and beginning prior to January 1, 2026, a partnership | ||||||
13 | (other than a publicly traded partnership under Section | ||||||
14 | 7704 of the Internal Revenue Code) or Subchapter S | ||||||
15 | corporation may elect to apply the provisions of this | ||||||
16 | subsection. A separate election shall be made for each | ||||||
17 | taxable year. Such election shall be made at such time, | ||||||
18 | and in such form and manner as prescribed by the | ||||||
19 | Department, and, once made, is irrevocable. | ||||||
20 | (2) Entity-level tax. A partnership or Subchapter S | ||||||
21 | corporation electing to apply the provisions of this | ||||||
22 | subsection shall be subject to a tax for the privilege of | ||||||
23 | earning or receiving income in this State in an amount | ||||||
24 | equal to 4.95% of the taxpayer's net income for the | ||||||
25 | taxable year. | ||||||
26 | (3) Net income defined. |
| |||||||
| |||||||
1 | (A) In general. For purposes of paragraph (2), the | ||||||
2 | term net income has the same meaning as defined in | ||||||
3 | Section 202 of this Act, except that the following | ||||||
4 | provisions shall not apply: | ||||||
5 | (i) the standard exemption allowed under | ||||||
6 | Section 204; | ||||||
7 | (ii) the deduction for net losses allowed | ||||||
8 | under Section 207; | ||||||
9 | (iii) in the case of an S corporation, the | ||||||
10 | modification under Section 203(b)(2)(S); and | ||||||
11 | (iv) in the case of a partnership, the | ||||||
12 | modifications under Section 203(d)(2)(H) and | ||||||
13 | Section 203(d)(2)(I). | ||||||
14 | (B) Special rule for tiered partnerships. If a | ||||||
15 | taxpayer making the election under paragraph (1) is a | ||||||
16 | partner of another taxpayer making the election under | ||||||
17 | paragraph (1), net income shall be computed as | ||||||
18 | provided in subparagraph (A), except that the taxpayer | ||||||
19 | shall subtract its distributive share of the net | ||||||
20 | income of the electing partnership (including its | ||||||
21 | distributive share of the net income of the electing | ||||||
22 | partnership derived as a distributive share from | ||||||
23 | electing partnerships in which it is a partner). | ||||||
24 | (4) Credit for entity level tax. Each partner or | ||||||
25 | shareholder of a taxpayer making the election under this | ||||||
26 | Section shall be allowed a credit against the tax imposed |
| |||||||
| |||||||
1 | under subsections (a) and (b) of Section 201 of this Act | ||||||
2 | for the taxable year of the partnership or Subchapter S | ||||||
3 | corporation for which an election is in effect ending | ||||||
4 | within or with the taxable year of the partner or | ||||||
5 | shareholder in an amount equal to 4.95% times the partner | ||||||
6 | or shareholder's distributive share of the net income of | ||||||
7 | the electing partnership or Subchapter S corporation, but | ||||||
8 | not to exceed the partner's or shareholder's share of the | ||||||
9 | tax imposed under paragraph (1) which is actually paid by | ||||||
10 | the partnership or Subchapter S corporation. If the | ||||||
11 | taxpayer is a partnership or Subchapter S corporation that | ||||||
12 | is itself a partner of a partnership making the election | ||||||
13 | under paragraph (1), the credit under this paragraph shall | ||||||
14 | be allowed to the taxpayer's partners or shareholders (or | ||||||
15 | if the partner is a partnership or Subchapter S | ||||||
16 | corporation then its partners or shareholders) in | ||||||
17 | accordance with the determination of income and | ||||||
18 | distributive share of income under Sections 702 and 704 | ||||||
19 | and Subchapter S of the Internal Revenue Code. If the | ||||||
20 | amount of the credit allowed under this paragraph exceeds | ||||||
21 | the partner's or shareholder's liability for tax imposed | ||||||
22 | under subsections (a) and (b) of Section 201 of this Act | ||||||
23 | for the taxable year, such excess shall be treated as an | ||||||
24 | overpayment for purposes of Section 909 of this Act. | ||||||
25 | (5) Nonresidents. A nonresident individual who is a | ||||||
26 | partner or shareholder of a partnership or Subchapter S |
| |||||||
| |||||||
1 | corporation for a taxable year for which an election is in | ||||||
2 | effect under paragraph (1) shall not be required to file | ||||||
3 | an income tax return under this Act for such taxable year | ||||||
4 | if the only source of net income of the individual (or the | ||||||
5 | individual and the individual's spouse in the case of a | ||||||
6 | joint return) is from an entity making the election under | ||||||
7 | paragraph (1) and the credit allowed to the partner or | ||||||
8 | shareholder under paragraph (4) equals or exceeds the | ||||||
9 | individual's liability for the tax imposed under | ||||||
10 | subsections (a) and (b) of Section 201 of this Act for the | ||||||
11 | taxable year. | ||||||
12 | (6) Liability for tax. Except as provided in this | ||||||
13 | paragraph, a partnership or Subchapter S making the | ||||||
14 | election under paragraph (1) is liable for the | ||||||
15 | entity-level tax imposed under paragraph (2). If the | ||||||
16 | electing partnership or corporation fails to pay the full | ||||||
17 | amount of tax deemed assessed under paragraph (2), the | ||||||
18 | partners or shareholders shall be liable to pay the tax | ||||||
19 | assessed (including penalties and interest). Each partner | ||||||
20 | or shareholder shall be liable for the unpaid assessment | ||||||
21 | based on the ratio of the partner's or shareholder's share | ||||||
22 | of the net income of the partnership over the total net | ||||||
23 | income of the partnership. If the partnership or | ||||||
24 | Subchapter S corporation fails to pay the tax assessed | ||||||
25 | (including penalties and interest) and thereafter an | ||||||
26 | amount of such tax is paid by the partners or |
| |||||||
| |||||||
1 | shareholders, such amount shall not be collected from the | ||||||
2 | partnership or corporation. | ||||||
3 | (7) Foreign tax. For purposes of the credit allowed | ||||||
4 | under Section 601(b)(3) of this Act, tax paid by a | ||||||
5 | partnership or Subchapter S corporation to another state | ||||||
6 | which, as determined by the Department, is substantially | ||||||
7 | similar to the tax imposed under this subsection, shall be | ||||||
8 | considered tax paid by the partner or shareholder to the | ||||||
9 | extent that the partner's or shareholder's share of the | ||||||
10 | income of the partnership or Subchapter S corporation | ||||||
11 | allocated and apportioned to such other state bears to the | ||||||
12 | total income of the partnership or Subchapter S | ||||||
13 | corporation allocated or apportioned to such other state. | ||||||
14 | (8) Suspension of withholding. The provisions of | ||||||
15 | Section 709.5 of this Act shall not apply to a partnership | ||||||
16 | or Subchapter S corporation for the taxable year for which | ||||||
17 | an election under paragraph (1) is in effect. | ||||||
18 | (9) Requirement to pay estimated tax. For each taxable | ||||||
19 | year for which an election under paragraph (1) is in | ||||||
20 | effect, a partnership or Subchapter S corporation is | ||||||
21 | required to pay estimated tax for such taxable year under | ||||||
22 | Sections 803 and 804 of this Act if the amount payable as | ||||||
23 | estimated tax can reasonably be expected to exceed $500. | ||||||
24 | (10) The provisions of this subsection shall apply | ||||||
25 | only with respect to taxable years for which the | ||||||
26 | limitation on individual deductions applies under Section |
| |||||||
| |||||||
1 | 164(b)(6) of the Internal Revenue Code. | ||||||
2 | (Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19; | ||||||
3 | 101-207, eff. 8-2-19; 101-363, eff. 8-9-19; 102-558, eff. | ||||||
4 | 8-20-21; 102-658, eff. 8-27-21.) | ||||||
5 | Section 10. The Use Tax Act is amended by changing | ||||||
6 | Sections 2 and 3-5 as follows:
| ||||||
7 | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
| ||||||
8 | Sec. 2. Definitions. As used in this Act: | ||||||
9 | "Broadband service" means a service provided by wireline | ||||||
10 | or wireless means capable of delivering high-speed internet | ||||||
11 | access at speeds of at least 25 megabits per second of download | ||||||
12 | speed and 3 megabits per second of upload speed. | ||||||
13 | "Use" means the exercise by any person of any right or | ||||||
14 | power over
tangible personal property incident to the | ||||||
15 | ownership of that property,
except that it does not include | ||||||
16 | the sale of such property in any form as
tangible personal | ||||||
17 | property in the regular course of business to the extent
that | ||||||
18 | such property is not first subjected to a use for which it was
| ||||||
19 | purchased, and does not include the use of such property by its | ||||||
20 | owner for
demonstration purposes: Provided that the property | ||||||
21 | purchased is deemed to
be purchased for the purpose of resale, | ||||||
22 | despite first being used, to the
extent to which it is resold | ||||||
23 | as an ingredient of an intentionally produced
product or | ||||||
24 | by-product of manufacturing. "Use" does not mean the |
| |||||||
| |||||||
1 | demonstration
use or interim use of tangible personal property | ||||||
2 | by a retailer before he sells
that tangible personal property. | ||||||
3 | For watercraft or aircraft, if the period of
demonstration use | ||||||
4 | or interim use by the retailer exceeds 18 months,
the retailer
| ||||||
5 | shall pay on the retailers' original cost price the tax | ||||||
6 | imposed by this Act,
and no credit for that tax is permitted if | ||||||
7 | the watercraft or aircraft is
subsequently sold by the | ||||||
8 | retailer. "Use" does not mean the physical
incorporation of | ||||||
9 | tangible personal property, to the extent not first subjected
| ||||||
10 | to a use for which it was purchased, as an ingredient or | ||||||
11 | constituent, into
other tangible personal property (a) which | ||||||
12 | is sold in the regular course of
business or (b) which the | ||||||
13 | person incorporating such ingredient or constituent
therein | ||||||
14 | has undertaken at the time of such purchase to cause to be | ||||||
15 | transported
in interstate commerce to destinations outside the | ||||||
16 | State of Illinois: Provided
that the property purchased is | ||||||
17 | deemed to be purchased for the purpose of
resale, despite | ||||||
18 | first being used, to the extent to which it is resold as an
| ||||||
19 | ingredient of an intentionally produced product or by-product | ||||||
20 | of manufacturing.
| ||||||
21 | "Watercraft" means a Class 2, Class 3, or Class 4 | ||||||
22 | watercraft as defined in
Section 3-2 of the Boat Registration | ||||||
23 | and Safety Act, a personal watercraft, or
any boat equipped | ||||||
24 | with an inboard motor.
| ||||||
25 | "Purchase at retail" means the acquisition of the | ||||||
26 | ownership of or title
to tangible personal property through a |
| |||||||
| |||||||
1 | sale at retail.
| ||||||
2 | "Purchaser" means anyone who, through a sale at retail, | ||||||
3 | acquires the
ownership of tangible personal property for a | ||||||
4 | valuable consideration.
| ||||||
5 | "Sale at retail" means any transfer of the ownership of or | ||||||
6 | title to
tangible personal property to a purchaser, for the | ||||||
7 | purpose of use, and not
for the purpose of resale in any form | ||||||
8 | as tangible personal property to the
extent not first | ||||||
9 | subjected to a use for which it was purchased, for a
valuable | ||||||
10 | consideration: Provided that the property purchased is deemed | ||||||
11 | to
be purchased for the purpose of resale, despite first being | ||||||
12 | used, to the
extent to which it is resold as an ingredient of | ||||||
13 | an intentionally produced
product or by-product of | ||||||
14 | manufacturing. For this purpose, slag produced as
an incident | ||||||
15 | to manufacturing pig iron or steel and sold is considered to be
| ||||||
16 | an intentionally produced by-product of manufacturing. "Sale | ||||||
17 | at retail"
includes any such transfer made for resale unless | ||||||
18 | made in compliance with
Section 2c of the Retailers' | ||||||
19 | Occupation Tax Act, as incorporated by
reference into Section | ||||||
20 | 12 of this Act. Transactions whereby the possession
of the | ||||||
21 | property is transferred but the seller retains the title as | ||||||
22 | security
for payment of the selling price are sales.
| ||||||
23 | "Sale at retail" shall also be construed to include any | ||||||
24 | Illinois
florist's sales transaction in which the purchase | ||||||
25 | order is received in
Illinois by a florist and the sale is for | ||||||
26 | use or consumption, but the
Illinois florist has a florist in |
| |||||||
| |||||||
1 | another state deliver the property to the
purchaser or the | ||||||
2 | purchaser's donee in such other state.
| ||||||
3 | Nonreusable tangible personal property that is used by | ||||||
4 | persons engaged in
the business of operating a restaurant, | ||||||
5 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
6 | transferred to customers in the ordinary course of business
as | ||||||
7 | part of the sale of food or beverages and is used to deliver, | ||||||
8 | package, or
consume food or beverages, regardless of where | ||||||
9 | consumption of the food or
beverages occurs. Examples of those | ||||||
10 | items include, but are not limited to
nonreusable, paper and | ||||||
11 | plastic cups, plates, baskets, boxes, sleeves, buckets
or | ||||||
12 | other containers, utensils, straws, placemats, napkins, doggie | ||||||
13 | bags, and
wrapping or packaging
materials that are transferred | ||||||
14 | to customers as part of the sale of food or
beverages in the | ||||||
15 | ordinary course of business.
| ||||||
16 | The purchase, employment and transfer of such tangible | ||||||
17 | personal property
as newsprint and ink for the primary purpose | ||||||
18 | of conveying news (with or
without other information) is not a | ||||||
19 | purchase, use or sale of tangible
personal property.
| ||||||
20 | "Selling price" means the consideration for a sale valued | ||||||
21 | in money
whether received in money or otherwise, including | ||||||
22 | cash, credits, property
other than as hereinafter provided, | ||||||
23 | and services, but, prior to January 1, 2020 and beginning | ||||||
24 | again on January 1, 2022, not including the
value of or credit | ||||||
25 | given for traded-in tangible personal property where the
item | ||||||
26 | that is traded-in is of like kind and character as that which |
| |||||||
| |||||||
1 | is being
sold; beginning January 1, 2020 and until January 1, | ||||||
2 | 2022, "selling price" includes the portion of the value of or | ||||||
3 | credit given for traded-in motor vehicles of the First | ||||||
4 | Division as defined in Section 1-146 of the Illinois Vehicle | ||||||
5 | Code of like kind and character as that which is being sold | ||||||
6 | that exceeds $10,000. "Selling price" shall be determined | ||||||
7 | without any deduction on account of the cost
of the property | ||||||
8 | sold, the cost of materials used, labor or service cost or
any | ||||||
9 | other expense whatsoever, but does not include interest or | ||||||
10 | finance
charges which appear as separate items on the bill of | ||||||
11 | sale or sales
contract nor charges that are added to prices by | ||||||
12 | sellers on account of the
seller's tax liability under the | ||||||
13 | Retailers' Occupation Tax Act, or on
account of the seller's | ||||||
14 | duty to collect, from the purchaser, the tax that
is imposed by | ||||||
15 | this Act, or, except as otherwise provided with respect to any | ||||||
16 | cigarette tax imposed by a home rule unit, on account of the | ||||||
17 | seller's tax liability under any local occupation tax | ||||||
18 | administered by the Department, or, except as otherwise | ||||||
19 | provided with respect to any cigarette tax imposed by a home | ||||||
20 | rule unit on account of the seller's duty to collect, from the | ||||||
21 | purchasers, the tax that is imposed under any local use tax | ||||||
22 | administered by the Department. Effective December 1, 1985, | ||||||
23 | "selling price"
shall include charges that are added to prices | ||||||
24 | by sellers on account of the
seller's tax liability under the | ||||||
25 | Cigarette Tax Act, on account of the seller's
duty to collect, | ||||||
26 | from the purchaser, the tax imposed under the Cigarette Use
|
| |||||||
| |||||||
1 | Tax Act, and on account of the seller's duty to collect, from | ||||||
2 | the purchaser,
any cigarette tax imposed by a home rule unit.
| ||||||
3 | Notwithstanding any law to the contrary, for any motor | ||||||
4 | vehicle, as defined in Section 1-146 of the Vehicle Code, that | ||||||
5 | is sold on or after January 1, 2015 for the purpose of leasing | ||||||
6 | the vehicle for a defined period that is longer than one year | ||||||
7 | and (1) is a motor vehicle of the second division that: (A) is | ||||||
8 | a self-contained motor vehicle designed or permanently | ||||||
9 | converted to provide living quarters for recreational, | ||||||
10 | camping, or travel use, with direct walk through access to the | ||||||
11 | living quarters from the driver's seat; (B) is of the van | ||||||
12 | configuration designed for the transportation of not less than | ||||||
13 | 7 nor more than 16 passengers; or (C) has a gross vehicle | ||||||
14 | weight rating of 8,000 pounds or less or (2) is a motor vehicle | ||||||
15 | of the first division, "selling price" or "amount of sale" | ||||||
16 | means the consideration received by the lessor pursuant to the | ||||||
17 | lease contract, including amounts due at lease signing and all | ||||||
18 | monthly or other regular payments charged over the term of the | ||||||
19 | lease. Also included in the selling price is any amount | ||||||
20 | received by the lessor from the lessee for the leased vehicle | ||||||
21 | that is not calculated at the time the lease is executed, | ||||||
22 | including, but not limited to, excess mileage charges and | ||||||
23 | charges for excess wear and tear. For sales that occur in | ||||||
24 | Illinois, with respect to any amount received by the lessor | ||||||
25 | from the lessee for the leased vehicle that is not calculated | ||||||
26 | at the time the lease is executed, the lessor who purchased the |
| |||||||
| |||||||
1 | motor vehicle does not incur the tax imposed by the Use Tax Act | ||||||
2 | on those amounts, and the retailer who makes the retail sale of | ||||||
3 | the motor vehicle to the lessor is not required to collect the | ||||||
4 | tax imposed by this Act or to pay the tax imposed by the | ||||||
5 | Retailers' Occupation Tax Act on those amounts. However, the | ||||||
6 | lessor who purchased the motor vehicle assumes the liability | ||||||
7 | for reporting and paying the tax on those amounts directly to | ||||||
8 | the Department in the same form (Illinois Retailers' | ||||||
9 | Occupation Tax, and local retailers' occupation taxes, if | ||||||
10 | applicable) in which the retailer would have reported and paid | ||||||
11 | such tax if the retailer had accounted for the tax to the | ||||||
12 | Department. For amounts received by the lessor from the lessee | ||||||
13 | that are not calculated at the time the lease is executed, the | ||||||
14 | lessor must file the return and pay the tax to the Department | ||||||
15 | by the due date otherwise required by this Act for returns | ||||||
16 | other than transaction returns. If the retailer is entitled | ||||||
17 | under this Act to a discount for collecting and remitting the | ||||||
18 | tax imposed under this Act to the Department with respect to | ||||||
19 | the sale of the motor vehicle to the lessor, then the right to | ||||||
20 | the discount provided in this Act shall be transferred to the | ||||||
21 | lessor with respect to the tax paid by the lessor for any | ||||||
22 | amount received by the lessor from the lessee for the leased | ||||||
23 | vehicle that is not calculated at the time the lease is | ||||||
24 | executed; provided that the discount is only allowed if the | ||||||
25 | return is timely filed and for amounts timely paid. The | ||||||
26 | "selling price" of a motor vehicle that is sold on or after |
| |||||||
| |||||||
1 | January 1, 2015 for the purpose of leasing for a defined period | ||||||
2 | of longer than one year shall not be reduced by the value of or | ||||||
3 | credit given for traded-in tangible personal property owned by | ||||||
4 | the lessor, nor shall it be reduced by the value of or credit | ||||||
5 | given for traded-in tangible personal property owned by the | ||||||
6 | lessee, regardless of whether the trade-in value thereof is | ||||||
7 | assigned by the lessee to the lessor. In the case of a motor | ||||||
8 | vehicle that is sold for the purpose of leasing for a defined | ||||||
9 | period of longer than one year, the sale occurs at the time of | ||||||
10 | the delivery of the vehicle, regardless of the due date of any | ||||||
11 | lease payments. A lessor who incurs a Retailers' Occupation | ||||||
12 | Tax liability on the sale of a motor vehicle coming off lease | ||||||
13 | may not take a credit against that liability for the Use Tax | ||||||
14 | the lessor paid upon the purchase of the motor vehicle (or for | ||||||
15 | any tax the lessor paid with respect to any amount received by | ||||||
16 | the lessor from the lessee for the leased vehicle that was not | ||||||
17 | calculated at the time the lease was executed) if the selling | ||||||
18 | price of the motor vehicle at the time of purchase was | ||||||
19 | calculated using the definition of "selling price" as defined | ||||||
20 | in this paragraph. Notwithstanding any other provision of this | ||||||
21 | Act to the contrary, lessors shall file all returns and make | ||||||
22 | all payments required under this paragraph to the Department | ||||||
23 | by electronic means in the manner and form as required by the | ||||||
24 | Department. This paragraph does not apply to leases of motor | ||||||
25 | vehicles for which, at the time the lease is entered into, the | ||||||
26 | term of the lease is not a defined period, including leases |
| |||||||
| |||||||
1 | with a defined initial period with the option to continue the | ||||||
2 | lease on a month-to-month or other basis beyond the initial | ||||||
3 | defined period. | ||||||
4 | The phrase "like kind and character" shall be liberally | ||||||
5 | construed
(including but not limited to any form of motor | ||||||
6 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
7 | agricultural implement for any other
kind of farm or | ||||||
8 | agricultural implement), while not including a kind of item
| ||||||
9 | which, if sold at retail by that retailer, would be exempt from | ||||||
10 | retailers'
occupation tax and use tax as an isolated or | ||||||
11 | occasional sale.
| ||||||
12 | "Department" means the Department of Revenue.
| ||||||
13 | "Person" means any natural individual, firm, partnership, | ||||||
14 | association,
joint stock company, joint adventure, public or | ||||||
15 | private corporation, limited
liability company, or a
receiver, | ||||||
16 | executor, trustee, guardian or other representative appointed
| ||||||
17 | by order of any court.
| ||||||
18 | "Retailer" means and includes every person engaged in the | ||||||
19 | business of
making sales at retail as defined in this Section.
| ||||||
20 | A person who holds himself or herself out as being engaged | ||||||
21 | (or who habitually
engages) in selling tangible personal | ||||||
22 | property at retail is a retailer
hereunder with respect to | ||||||
23 | such sales (and not primarily in a service
occupation) | ||||||
24 | notwithstanding the fact that such person designs and produces
| ||||||
25 | such tangible personal property on special order for the | ||||||
26 | purchaser and in
such a way as to render the property of value |
| |||||||
| |||||||
1 | only to such purchaser, if
such tangible personal property so | ||||||
2 | produced on special order serves
substantially the same | ||||||
3 | function as stock or standard items of tangible
personal | ||||||
4 | property that are sold at retail.
| ||||||
5 | A person whose activities are organized and conducted | ||||||
6 | primarily as a
not-for-profit service enterprise, and who | ||||||
7 | engages in selling tangible
personal property at retail | ||||||
8 | (whether to the public or merely to members and
their guests) | ||||||
9 | is a retailer with respect to such transactions, excepting
| ||||||
10 | only a person organized and operated exclusively for | ||||||
11 | charitable, religious
or educational purposes either (1), to | ||||||
12 | the extent of sales by such person
to its members, students, | ||||||
13 | patients or inmates of tangible personal property
to be used | ||||||
14 | primarily for the purposes of such person, or (2), to the | ||||||
15 | extent
of sales by such person of tangible personal property | ||||||
16 | which is not sold or
offered for sale by persons organized for | ||||||
17 | profit. The selling of school
books and school supplies by | ||||||
18 | schools at retail to students is not
"primarily for the | ||||||
19 | purposes of" the school which does such selling. This
| ||||||
20 | paragraph does not apply to nor subject to taxation occasional | ||||||
21 | dinners,
social or similar activities of a person organized | ||||||
22 | and operated exclusively
for charitable, religious or | ||||||
23 | educational purposes, whether or not such
activities are open | ||||||
24 | to the public.
| ||||||
25 | A person who is the recipient of a grant or contract under | ||||||
26 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and |
| |||||||
| |||||||
1 | serves meals to
participants in the federal Nutrition Program | ||||||
2 | for the Elderly in return for
contributions established in | ||||||
3 | amount by the individual participant pursuant
to a schedule of | ||||||
4 | suggested fees as provided for in the federal Act is not a
| ||||||
5 | retailer under this Act with respect to such transactions.
| ||||||
6 | Persons who engage in the business of transferring | ||||||
7 | tangible personal
property upon the redemption of trading | ||||||
8 | stamps are retailers hereunder when
engaged in such business.
| ||||||
9 | The isolated or occasional sale of tangible personal | ||||||
10 | property at retail
by a person who does not hold himself out as | ||||||
11 | being engaged (or who does not
habitually engage) in selling | ||||||
12 | such tangible personal property at retail or
a sale through a | ||||||
13 | bulk vending machine does not make such person a retailer
| ||||||
14 | hereunder. However, any person who is engaged in a business | ||||||
15 | which is not
subject to the tax imposed by the Retailers' | ||||||
16 | Occupation Tax Act because
of involving the sale of or a | ||||||
17 | contract to sell real estate or a
construction contract to | ||||||
18 | improve real estate, but who, in the course of
conducting such | ||||||
19 | business, transfers tangible personal property to users or
| ||||||
20 | consumers in the finished form in which it was purchased, and | ||||||
21 | which does
not become real estate, under any provision of a | ||||||
22 | construction contract or
real estate sale or real estate sales | ||||||
23 | agreement entered into with some
other person arising out of | ||||||
24 | or because of such nontaxable business, is a
retailer to the | ||||||
25 | extent of the value of the tangible personal property so
| ||||||
26 | transferred. If, in such transaction, a separate charge is |
| |||||||
| |||||||
1 | made for the
tangible personal property so transferred, the | ||||||
2 | value of such property, for
the purposes of this Act, is the | ||||||
3 | amount so separately charged, but not less
than the cost of | ||||||
4 | such property to the transferor; if no separate charge is
| ||||||
5 | made, the value of such property, for the purposes of this Act, | ||||||
6 | is the cost
to the transferor of such tangible personal | ||||||
7 | property.
| ||||||
8 | "Retailer maintaining a place of business in this State", | ||||||
9 | or any like
term, means and includes any of the following | ||||||
10 | retailers:
| ||||||
11 | (1) A retailer having or maintaining within this | ||||||
12 | State, directly or by
a subsidiary, an office, | ||||||
13 | distribution house, sales house, warehouse or other
place | ||||||
14 | of business, or any agent or other representative | ||||||
15 | operating within this
State under the authority of the | ||||||
16 | retailer or its subsidiary, irrespective of
whether such | ||||||
17 | place of business or agent or other representative is | ||||||
18 | located here
permanently or temporarily, or whether such | ||||||
19 | retailer or subsidiary is licensed
to do business in this | ||||||
20 | State. However, the ownership of property that is
located | ||||||
21 | at the premises of a printer with which the retailer has | ||||||
22 | contracted for
printing and that consists of the final | ||||||
23 | printed product, property that becomes
a part of the final | ||||||
24 | printed product, or copy from which the printed product is
| ||||||
25 | produced shall not result in the retailer being deemed to | ||||||
26 | have or maintain an
office, distribution house, sales |
| |||||||
| |||||||
1 | house, warehouse, or other place of business
within this | ||||||
2 | State. | ||||||
3 | (1.1) A retailer having a contract with a person | ||||||
4 | located in this State under which the person, for a | ||||||
5 | commission or other consideration based upon the sale of | ||||||
6 | tangible personal property by the retailer, directly or | ||||||
7 | indirectly refers potential customers to the retailer by | ||||||
8 | providing to the potential customers a promotional code or | ||||||
9 | other mechanism that allows the retailer to track | ||||||
10 | purchases referred by such persons. Examples of mechanisms | ||||||
11 | that allow the retailer to track purchases referred by | ||||||
12 | such persons include but are not limited to the use of a | ||||||
13 | link on the person's Internet website, promotional codes | ||||||
14 | distributed through the person's hand-delivered or mailed | ||||||
15 | material, and promotional codes distributed by the person | ||||||
16 | through radio or other broadcast media. The provisions of | ||||||
17 | this paragraph (1.1) shall apply only if the cumulative | ||||||
18 | gross receipts from sales of tangible personal property by | ||||||
19 | the retailer to customers who are referred to the retailer | ||||||
20 | by all persons in this State under such contracts exceed | ||||||
21 | $10,000 during the preceding 4 quarterly periods ending on | ||||||
22 | the last day of March, June, September, and December. A | ||||||
23 | retailer meeting the requirements of this paragraph (1.1) | ||||||
24 | shall be presumed to be maintaining a place of business in | ||||||
25 | this State but may rebut this presumption by submitting | ||||||
26 | proof that the referrals or other activities pursued |
| |||||||
| |||||||
1 | within this State by such persons were not sufficient to | ||||||
2 | meet the nexus standards of the United States Constitution | ||||||
3 | during the preceding 4 quarterly periods. | ||||||
4 | (1.2) Beginning July 1, 2011, a retailer having a | ||||||
5 | contract with a person located in this State under which: | ||||||
6 | (A) the retailer sells the same or substantially | ||||||
7 | similar line of products as the person located in this | ||||||
8 | State and does so using an identical or substantially | ||||||
9 | similar name, trade name, or trademark as the person | ||||||
10 | located in this State; and | ||||||
11 | (B) the retailer provides a commission or other | ||||||
12 | consideration to the person located in this State | ||||||
13 | based upon the sale of tangible personal property by | ||||||
14 | the retailer. | ||||||
15 | The provisions of this paragraph (1.2) shall apply | ||||||
16 | only if the cumulative gross receipts from sales of | ||||||
17 | tangible personal property by the retailer to customers in | ||||||
18 | this State under all such contracts exceed $10,000 during | ||||||
19 | the preceding 4 quarterly periods ending on the last day | ||||||
20 | of March, June, September, and December.
| ||||||
21 | (2) (Blank).
| ||||||
22 | (3) (Blank).
| ||||||
23 | (4) (Blank).
| ||||||
24 | (5) (Blank).
| ||||||
25 | (6) (Blank).
| ||||||
26 | (7) (Blank).
|
| |||||||
| |||||||
1 | (8) (Blank).
| ||||||
2 | (9) Beginning October 1, 2018, a retailer making sales | ||||||
3 | of tangible personal property to purchasers in Illinois | ||||||
4 | from outside of Illinois if: | ||||||
5 | (A) the cumulative gross receipts from sales of | ||||||
6 | tangible personal property to purchasers in Illinois | ||||||
7 | are $100,000 or more; or | ||||||
8 | (B) the retailer enters into 200 or more separate | ||||||
9 | transactions for the sale of tangible personal | ||||||
10 | property to purchasers in Illinois. | ||||||
11 | The retailer shall determine on a quarterly basis, | ||||||
12 | ending on the last day of March, June, September, and | ||||||
13 | December, whether he or she meets the criteria of either | ||||||
14 | subparagraph (A) or (B) of this paragraph (9) for the | ||||||
15 | preceding 12-month period. If the retailer meets the | ||||||
16 | threshold of either subparagraph (A) or (B) for a 12-month | ||||||
17 | period, he or she is considered a retailer maintaining a | ||||||
18 | place of business in this State and is required to collect | ||||||
19 | and remit the tax imposed under this Act and file returns | ||||||
20 | for one year. At the end of that one-year period, the | ||||||
21 | retailer shall determine whether he or she met the | ||||||
22 | threshold of either subparagraph (A) or (B) during the | ||||||
23 | preceding 12-month period. If the retailer met the | ||||||
24 | criteria in either subparagraph (A) or (B) for the | ||||||
25 | preceding 12-month period, he or she is considered a | ||||||
26 | retailer maintaining a place of business in this State and |
| |||||||
| |||||||
1 | is required to collect and remit the tax imposed under | ||||||
2 | this Act and file returns for the subsequent year. If at | ||||||
3 | the end of a one-year period a retailer that was required | ||||||
4 | to collect and remit the tax imposed under this Act | ||||||
5 | determines that he or she did not meet the threshold in | ||||||
6 | either subparagraph (A) or (B) during the preceding | ||||||
7 | 12-month period, the retailer shall subsequently determine | ||||||
8 | on a quarterly basis, ending on the last day of March, | ||||||
9 | June, September, and December, whether he or she meets the | ||||||
10 | threshold of either subparagraph (A) or (B) for the | ||||||
11 | preceding 12-month period. | ||||||
12 | Beginning January 1, 2020, neither the gross receipts | ||||||
13 | from nor the number of separate transactions for sales of | ||||||
14 | tangible personal property to purchasers in Illinois that | ||||||
15 | a retailer makes through a marketplace facilitator and for | ||||||
16 | which the retailer has received a certification from the | ||||||
17 | marketplace facilitator pursuant to Section 2d of this Act | ||||||
18 | shall be included for purposes of determining whether he | ||||||
19 | or she has met the thresholds of this paragraph (9). | ||||||
20 | (10) Beginning January 1, 2020, a marketplace | ||||||
21 | facilitator that meets a threshold set forth in subsection | ||||||
22 | (b) of Section 2d of this Act. | ||||||
23 | "Bulk vending machine" means a vending machine,
containing | ||||||
24 | unsorted confections, nuts, toys, or other items designed
| ||||||
25 | primarily to be used or played with by children
which, when a | ||||||
26 | coin or coins of a denomination not larger than $0.50 are |
| |||||||
| |||||||
1 | inserted, are dispensed in equal portions, at random and
| ||||||
2 | without selection by the customer.
| ||||||
3 | (Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 1-1-20; | ||||||
4 | 101-604, eff. 1-1-20; 102-353, eff. 1-1-22 .)
| ||||||
5 | (35 ILCS 105/3-5)
| ||||||
6 | Sec. 3-5. Exemptions. Use of the following tangible | ||||||
7 | personal property is exempt from the tax imposed by this Act:
| ||||||
8 | (1) Personal property purchased from a corporation, | ||||||
9 | society, association,
foundation, institution, or | ||||||
10 | organization, other than a limited liability
company, that is | ||||||
11 | organized and operated as a not-for-profit service enterprise
| ||||||
12 | for the benefit of persons 65 years of age or older if the | ||||||
13 | personal property was not purchased by the enterprise for the | ||||||
14 | purpose of resale by the
enterprise.
| ||||||
15 | (2) Personal property purchased by a not-for-profit | ||||||
16 | Illinois county
fair association for use in conducting, | ||||||
17 | operating, or promoting the
county fair.
| ||||||
18 | (3) Personal property purchased by a not-for-profit
arts | ||||||
19 | or cultural organization that establishes, by proof required | ||||||
20 | by the
Department by
rule, that it has received an exemption | ||||||
21 | under Section 501(c)(3) of the Internal
Revenue Code and that | ||||||
22 | is organized and operated primarily for the
presentation
or | ||||||
23 | support of arts or cultural programming, activities, or | ||||||
24 | services. These
organizations include, but are not limited to, | ||||||
25 | music and dramatic arts
organizations such as symphony |
| |||||||
| |||||||
1 | orchestras and theatrical groups, arts and
cultural service | ||||||
2 | organizations, local arts councils, visual arts organizations,
| ||||||
3 | and media arts organizations.
On and after July 1, 2001 (the | ||||||
4 | effective date of Public Act 92-35), however, an entity | ||||||
5 | otherwise eligible for this exemption shall not
make tax-free | ||||||
6 | purchases unless it has an active identification number issued | ||||||
7 | by
the Department.
| ||||||
8 | (4) Personal property purchased by a governmental body, by | ||||||
9 | a
corporation, society, association, foundation, or | ||||||
10 | institution organized and
operated exclusively for charitable, | ||||||
11 | religious, or educational purposes, or
by a not-for-profit | ||||||
12 | corporation, society, association, foundation,
institution, or | ||||||
13 | organization that has no compensated officers or employees
and | ||||||
14 | that is organized and operated primarily for the recreation of | ||||||
15 | persons
55 years of age or older. A limited liability company | ||||||
16 | may qualify for the
exemption under this paragraph only if the | ||||||
17 | limited liability company is
organized and operated | ||||||
18 | exclusively for educational purposes. On and after July
1, | ||||||
19 | 1987, however, no entity otherwise eligible for this exemption | ||||||
20 | shall make
tax-free purchases unless it has an active | ||||||
21 | exemption identification number
issued by the Department.
| ||||||
22 | (5) Until July 1, 2003, a passenger car that is a | ||||||
23 | replacement vehicle to
the extent that the
purchase price of | ||||||
24 | the car is subject to the Replacement Vehicle Tax.
| ||||||
25 | (6) Until July 1, 2003 and beginning again on September 1, | ||||||
26 | 2004 through August 30, 2014, graphic arts machinery and |
| |||||||
| |||||||
1 | equipment, including
repair and replacement
parts, both new | ||||||
2 | and used, and including that manufactured on special order,
| ||||||
3 | certified by the purchaser to be used primarily for graphic | ||||||
4 | arts production,
and including machinery and equipment | ||||||
5 | purchased for lease.
Equipment includes chemicals or chemicals | ||||||
6 | acting as catalysts but only if
the
chemicals or chemicals | ||||||
7 | acting as catalysts effect a direct and immediate change
upon | ||||||
8 | a graphic arts product. Beginning on July 1, 2017, graphic | ||||||
9 | arts machinery and equipment is included in the manufacturing | ||||||
10 | and assembling machinery and equipment exemption under | ||||||
11 | paragraph (18).
| ||||||
12 | (7) Farm chemicals.
| ||||||
13 | (8) Legal tender, currency, medallions, or gold or silver | ||||||
14 | coinage issued by
the State of Illinois, the government of the | ||||||
15 | United States of America, or the
government of any foreign | ||||||
16 | country, and bullion.
| ||||||
17 | (9) Personal property purchased from a teacher-sponsored | ||||||
18 | student
organization affiliated with an elementary or | ||||||
19 | secondary school located in
Illinois.
| ||||||
20 | (10) A motor vehicle that is used for automobile renting, | ||||||
21 | as defined in the
Automobile Renting Occupation and Use Tax | ||||||
22 | Act.
| ||||||
23 | (11) Farm machinery and equipment, both new and used,
| ||||||
24 | including that manufactured on special order, certified by the | ||||||
25 | purchaser
to be used primarily for production agriculture or | ||||||
26 | State or federal
agricultural programs, including individual |
| |||||||
| |||||||
1 | replacement parts for
the machinery and equipment, including | ||||||
2 | machinery and equipment
purchased
for lease,
and including | ||||||
3 | implements of husbandry defined in Section 1-130 of
the | ||||||
4 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
5 | chemical and
fertilizer spreaders, and nurse wagons required | ||||||
6 | to be registered
under Section 3-809 of the Illinois Vehicle | ||||||
7 | Code,
but excluding other motor
vehicles required to be
| ||||||
8 | registered under the Illinois Vehicle Code.
Horticultural | ||||||
9 | polyhouses or hoop houses used for propagating, growing, or
| ||||||
10 | overwintering plants shall be considered farm machinery and | ||||||
11 | equipment under
this item (11).
Agricultural chemical tender | ||||||
12 | tanks and dry boxes shall include units sold
separately from a | ||||||
13 | motor vehicle required to be licensed and units sold mounted
| ||||||
14 | on a motor vehicle required to be licensed if the selling price | ||||||
15 | of the tender
is separately stated.
| ||||||
16 | Farm machinery and equipment shall include precision | ||||||
17 | farming equipment
that is
installed or purchased to be | ||||||
18 | installed on farm machinery and equipment
including, but not | ||||||
19 | limited to, tractors, harvesters, sprayers, planters,
seeders, | ||||||
20 | or spreaders.
Precision farming equipment includes, but is not | ||||||
21 | limited to, soil testing
sensors, computers, monitors, | ||||||
22 | software, global positioning
and mapping systems, and other | ||||||
23 | such equipment.
| ||||||
24 | Farm machinery and equipment also includes computers, | ||||||
25 | sensors, software, and
related equipment used primarily in the
| ||||||
26 | computer-assisted operation of production agriculture |
| |||||||
| |||||||
1 | facilities, equipment,
and
activities such as, but not limited | ||||||
2 | to,
the collection, monitoring, and correlation of
animal and | ||||||
3 | crop data for the purpose of
formulating animal diets and | ||||||
4 | agricultural chemicals. This item (11) is exempt
from the | ||||||
5 | provisions of
Section 3-90.
| ||||||
6 | (12) Until June 30, 2013, fuel and petroleum products sold | ||||||
7 | to or used by an air common
carrier, certified by the carrier | ||||||
8 | to be used for consumption, shipment, or
storage in the | ||||||
9 | conduct of its business as an air common carrier, for a
flight | ||||||
10 | destined for or returning from a location or locations
outside | ||||||
11 | the United States without regard to previous or subsequent | ||||||
12 | domestic
stopovers.
| ||||||
13 | Beginning July 1, 2013, fuel and petroleum products sold | ||||||
14 | to or used by an air carrier, certified by the carrier to be | ||||||
15 | used for consumption, shipment, or storage in the conduct of | ||||||
16 | its business as an air common carrier, for a flight that (i) is | ||||||
17 | engaged in foreign trade or is engaged in trade between the | ||||||
18 | United States and any of its possessions and (ii) transports | ||||||
19 | at least one individual or package for hire from the city of | ||||||
20 | origination to the city of final destination on the same | ||||||
21 | aircraft, without regard to a change in the flight number of | ||||||
22 | that aircraft. | ||||||
23 | (13) Proceeds of mandatory service charges separately
| ||||||
24 | stated on customers' bills for the purchase and consumption of | ||||||
25 | food and
beverages purchased at retail from a retailer, to the | ||||||
26 | extent that the proceeds
of the service charge are in fact |
| |||||||
| |||||||
1 | turned over as tips or as a substitute
for tips to the | ||||||
2 | employees who participate directly in preparing, serving,
| ||||||
3 | hosting or cleaning up the food or beverage function with | ||||||
4 | respect to which
the service charge is imposed.
| ||||||
5 | (14) Until July 1, 2003, oil field exploration, drilling, | ||||||
6 | and production
equipment,
including (i) rigs and parts of | ||||||
7 | rigs, rotary
rigs, cable tool rigs, and workover rigs, (ii) | ||||||
8 | pipe and tubular goods,
including casing and drill strings, | ||||||
9 | (iii) pumps and pump-jack units, (iv)
storage tanks and flow | ||||||
10 | lines, (v) any individual replacement part for oil
field | ||||||
11 | exploration, drilling, and production equipment, and (vi) | ||||||
12 | machinery and
equipment purchased
for lease; but excluding | ||||||
13 | motor vehicles required to be registered under the
Illinois | ||||||
14 | Vehicle Code.
| ||||||
15 | (15) Photoprocessing machinery and equipment, including | ||||||
16 | repair and
replacement parts, both new and used, including | ||||||
17 | that
manufactured on special order, certified by the purchaser | ||||||
18 | to be used
primarily for photoprocessing, and including
| ||||||
19 | photoprocessing machinery and equipment purchased for lease.
| ||||||
20 | (16) Until July 1, 2023, coal and aggregate exploration, | ||||||
21 | mining, off-highway hauling,
processing, maintenance, and | ||||||
22 | reclamation equipment,
including replacement parts and | ||||||
23 | equipment, and
including equipment purchased for lease, but | ||||||
24 | excluding motor
vehicles required to be registered under the | ||||||
25 | Illinois Vehicle Code. The changes made to this Section by | ||||||
26 | Public Act 97-767 apply on and after July 1, 2003, but no claim |
| |||||||
| |||||||
1 | for credit or refund is allowed on or after August 16, 2013 | ||||||
2 | (the effective date of Public Act 98-456)
for such taxes paid | ||||||
3 | during the period beginning July 1, 2003 and ending on August | ||||||
4 | 16, 2013 (the effective date of Public Act 98-456).
| ||||||
5 | (17) Until July 1, 2003, distillation machinery and | ||||||
6 | equipment, sold as a
unit or kit,
assembled or installed by the | ||||||
7 | retailer, certified by the user to be used
only for the | ||||||
8 | production of ethyl alcohol that will be used for consumption
| ||||||
9 | as motor fuel or as a component of motor fuel for the personal | ||||||
10 | use of the
user, and not subject to sale or resale.
| ||||||
11 | (18) Manufacturing and assembling machinery and equipment | ||||||
12 | used
primarily in the process of manufacturing or assembling | ||||||
13 | tangible
personal property for wholesale or retail sale or | ||||||
14 | lease, whether that sale
or lease is made directly by the | ||||||
15 | manufacturer or by some other person,
whether the materials | ||||||
16 | used in the process are
owned by the manufacturer or some other | ||||||
17 | person, or whether that sale or
lease is made apart from or as | ||||||
18 | an incident to the seller's engaging in
the service occupation | ||||||
19 | of producing machines, tools, dies, jigs,
patterns, gauges, or | ||||||
20 | other similar items of no commercial value on
special order | ||||||
21 | for a particular purchaser. The exemption provided by this | ||||||
22 | paragraph (18) includes production related tangible personal | ||||||
23 | property, as defined in Section 3-50, purchased on or after | ||||||
24 | July 1, 2019. The exemption provided by this paragraph (18) | ||||||
25 | does not include machinery and equipment used in (i) the | ||||||
26 | generation of electricity for wholesale or retail sale; (ii) |
| |||||||
| |||||||
1 | the generation or treatment of natural or artificial gas for | ||||||
2 | wholesale or retail sale that is delivered to customers | ||||||
3 | through pipes, pipelines, or mains; or (iii) the treatment of | ||||||
4 | water for wholesale or retail sale that is delivered to | ||||||
5 | customers through pipes, pipelines, or mains. The provisions | ||||||
6 | of Public Act 98-583 are declaratory of existing law as to the | ||||||
7 | meaning and scope of this exemption. Beginning on July 1, | ||||||
8 | 2017, the exemption provided by this paragraph (18) includes, | ||||||
9 | but is not limited to, graphic arts machinery and equipment, | ||||||
10 | as defined in paragraph (6) of this Section.
| ||||||
11 | (19) Personal property delivered to a purchaser or | ||||||
12 | purchaser's donee
inside Illinois when the purchase order for | ||||||
13 | that personal property was
received by a florist located | ||||||
14 | outside Illinois who has a florist located
inside Illinois | ||||||
15 | deliver the personal property.
| ||||||
16 | (20) Semen used for artificial insemination of livestock | ||||||
17 | for direct
agricultural production.
| ||||||
18 | (21) Horses, or interests in horses, registered with and | ||||||
19 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
20 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
21 | Horse Association, United States
Trotting Association, or | ||||||
22 | Jockey Club, as appropriate, used for
purposes of breeding or | ||||||
23 | racing for prizes. This item (21) is exempt from the | ||||||
24 | provisions of Section 3-90, and the exemption provided for | ||||||
25 | under this item (21) applies for all periods beginning May 30, | ||||||
26 | 1995, but no claim for credit or refund is allowed on or after |
| |||||||
| |||||||
1 | January 1, 2008
for such taxes paid during the period | ||||||
2 | beginning May 30, 2000 and ending on January 1, 2008.
| ||||||
3 | (22) Computers and communications equipment utilized for | ||||||
4 | any
hospital
purpose
and equipment used in the diagnosis,
| ||||||
5 | analysis, or treatment of hospital patients purchased by a | ||||||
6 | lessor who leases
the
equipment, under a lease of one year or | ||||||
7 | longer executed or in effect at the
time the lessor would | ||||||
8 | otherwise be subject to the tax imposed by this Act, to a
| ||||||
9 | hospital
that has been issued an active tax exemption | ||||||
10 | identification number by
the
Department under Section 1g of | ||||||
11 | the Retailers' Occupation Tax Act. If the
equipment is leased | ||||||
12 | in a manner that does not qualify for
this exemption or is used | ||||||
13 | in any other non-exempt manner, the lessor
shall be liable for | ||||||
14 | the
tax imposed under this Act or the Service Use Tax Act, as | ||||||
15 | the case may
be, based on the fair market value of the property | ||||||
16 | at the time the
non-qualifying use occurs. No lessor shall | ||||||
17 | collect or attempt to collect an
amount (however
designated) | ||||||
18 | that purports to reimburse that lessor for the tax imposed by | ||||||
19 | this
Act or the Service Use Tax Act, as the case may be, if the | ||||||
20 | tax has not been
paid by the lessor. If a lessor improperly | ||||||
21 | collects any such amount from the
lessee, the lessee shall | ||||||
22 | have a legal right to claim a refund of that amount
from the | ||||||
23 | lessor. If, however, that amount is not refunded to the lessee | ||||||
24 | for
any reason, the lessor is liable to pay that amount to the | ||||||
25 | Department.
| ||||||
26 | (23) Personal property purchased by a lessor who leases |
| |||||||
| |||||||
1 | the
property, under
a
lease of
one year or longer executed or | ||||||
2 | in effect at the time
the lessor would otherwise be subject to | ||||||
3 | the tax imposed by this Act,
to a governmental body
that has | ||||||
4 | been issued an active sales tax exemption identification | ||||||
5 | number by the
Department under Section 1g of the Retailers' | ||||||
6 | Occupation Tax Act.
If the
property is leased in a manner that | ||||||
7 | does not qualify for
this exemption
or used in any other | ||||||
8 | non-exempt manner, the lessor shall be liable for the
tax | ||||||
9 | imposed under this Act or the Service Use Tax Act, as the case | ||||||
10 | may
be, based on the fair market value of the property at the | ||||||
11 | time the
non-qualifying use occurs. No lessor shall collect or | ||||||
12 | attempt to collect an
amount (however
designated) that | ||||||
13 | purports to reimburse that lessor for the tax imposed by this
| ||||||
14 | Act or the Service Use Tax Act, as the case may be, if the tax | ||||||
15 | has not been
paid by the lessor. If a lessor improperly | ||||||
16 | collects any such amount from the
lessee, the lessee shall | ||||||
17 | have a legal right to claim a refund of that amount
from the | ||||||
18 | lessor. If, however, that amount is not refunded to the lessee | ||||||
19 | for
any reason, the lessor is liable to pay that amount to the | ||||||
20 | Department.
| ||||||
21 | (24) Beginning with taxable years ending on or after | ||||||
22 | December
31, 1995
and
ending with taxable years ending on or | ||||||
23 | before December 31, 2004,
personal property that is
donated | ||||||
24 | for disaster relief to be used in a State or federally declared
| ||||||
25 | disaster area in Illinois or bordering Illinois by a | ||||||
26 | manufacturer or retailer
that is registered in this State to a |
| |||||||
| |||||||
1 | corporation, society, association,
foundation, or institution | ||||||
2 | that has been issued a sales tax exemption
identification | ||||||
3 | number by the Department that assists victims of the disaster
| ||||||
4 | who reside within the declared disaster area.
| ||||||
5 | (25) Beginning with taxable years ending on or after | ||||||
6 | December
31, 1995 and
ending with taxable years ending on or | ||||||
7 | before December 31, 2004, personal
property that is used in | ||||||
8 | the performance of infrastructure repairs in this
State, | ||||||
9 | including but not limited to municipal roads and streets, | ||||||
10 | access roads,
bridges, sidewalks, waste disposal systems, | ||||||
11 | water and sewer line extensions,
water distribution and | ||||||
12 | purification facilities, storm water drainage and
retention | ||||||
13 | facilities, and sewage treatment facilities, resulting from a | ||||||
14 | State
or federally declared disaster in Illinois or bordering | ||||||
15 | Illinois when such
repairs are initiated on facilities located | ||||||
16 | in the declared disaster area
within 6 months after the | ||||||
17 | disaster.
| ||||||
18 | (26) Beginning July 1, 1999, game or game birds purchased | ||||||
19 | at a "game
breeding
and hunting preserve area" as that term is
| ||||||
20 | used in
the Wildlife Code. This paragraph is exempt from the | ||||||
21 | provisions
of
Section 3-90.
| ||||||
22 | (27) A motor vehicle, as that term is defined in Section | ||||||
23 | 1-146
of the
Illinois
Vehicle Code, that is donated to a | ||||||
24 | corporation, limited liability company,
society, association, | ||||||
25 | foundation, or institution that is determined by the
| ||||||
26 | Department to be organized and operated exclusively for |
| |||||||
| |||||||
1 | educational purposes.
For purposes of this exemption, "a | ||||||
2 | corporation, limited liability company,
society, association, | ||||||
3 | foundation, or institution organized and operated
exclusively | ||||||
4 | for educational purposes" means all tax-supported public | ||||||
5 | schools,
private schools that offer systematic instruction in | ||||||
6 | useful branches of
learning by methods common to public | ||||||
7 | schools and that compare favorably in
their scope and | ||||||
8 | intensity with the course of study presented in tax-supported
| ||||||
9 | schools, and vocational or technical schools or institutes | ||||||
10 | organized and
operated exclusively to provide a course of | ||||||
11 | study of not less than 6 weeks
duration and designed to prepare | ||||||
12 | individuals to follow a trade or to pursue a
manual, | ||||||
13 | technical, mechanical, industrial, business, or commercial
| ||||||
14 | occupation.
| ||||||
15 | (28) Beginning January 1, 2000, personal property, | ||||||
16 | including
food,
purchased through fundraising
events for the | ||||||
17 | benefit of
a public or private elementary or
secondary school, | ||||||
18 | a group of those schools, or one or more school
districts if | ||||||
19 | the events are
sponsored by an entity recognized by the school | ||||||
20 | district that consists
primarily of volunteers and includes
| ||||||
21 | parents and teachers of the school children. This paragraph | ||||||
22 | does not apply
to fundraising
events (i) for the benefit of | ||||||
23 | private home instruction or (ii)
for which the fundraising | ||||||
24 | entity purchases the personal property sold at
the events from | ||||||
25 | another individual or entity that sold the property for the
| ||||||
26 | purpose of resale by the fundraising entity and that
profits |
| |||||||
| |||||||
1 | from the sale to the
fundraising entity. This paragraph is | ||||||
2 | exempt
from the provisions
of Section 3-90.
| ||||||
3 | (29) Beginning January 1, 2000 and through December 31, | ||||||
4 | 2001, new or
used automatic vending
machines that prepare and | ||||||
5 | serve hot food and beverages, including coffee, soup,
and
| ||||||
6 | other items, and replacement parts for these machines.
| ||||||
7 | Beginning January 1,
2002 and through June 30, 2003, machines | ||||||
8 | and parts for machines used in
commercial, coin-operated | ||||||
9 | amusement and vending business if a use or occupation
tax is | ||||||
10 | paid on the gross receipts derived from the use of the | ||||||
11 | commercial,
coin-operated amusement and vending machines.
This
| ||||||
12 | paragraph
is exempt from the provisions of Section 3-90.
| ||||||
13 | (30) Beginning January 1, 2001 and through June 30, 2016, | ||||||
14 | food for human consumption that is to be consumed off the | ||||||
15 | premises
where it is sold (other than alcoholic beverages, | ||||||
16 | soft drinks, and food that
has been prepared for immediate | ||||||
17 | consumption) and prescription and
nonprescription medicines, | ||||||
18 | drugs, medical appliances, and insulin, urine
testing | ||||||
19 | materials, syringes, and needles used by diabetics, for human | ||||||
20 | use, when
purchased for use by a person receiving medical | ||||||
21 | assistance under Article V of
the Illinois Public Aid Code who | ||||||
22 | resides in a licensed long-term care facility,
as defined in | ||||||
23 | the Nursing Home Care Act, or in a licensed facility as defined | ||||||
24 | in the ID/DD Community Care Act, the MC/DD Act, or the | ||||||
25 | Specialized Mental Health Rehabilitation Act of 2013.
| ||||||
26 | (31) Beginning on August 2, 2001 (the effective date of |
| |||||||
| |||||||
1 | Public Act 92-227),
computers and communications equipment
| ||||||
2 | utilized for any hospital purpose and equipment used in the | ||||||
3 | diagnosis,
analysis, or treatment of hospital patients | ||||||
4 | purchased by a lessor who leases
the equipment, under a lease | ||||||
5 | of one year or longer executed or in effect at the
time the | ||||||
6 | lessor would otherwise be subject to the tax imposed by this | ||||||
7 | Act, to a
hospital that has been issued an active tax exemption | ||||||
8 | identification number by
the Department under Section 1g of | ||||||
9 | the Retailers' Occupation Tax Act. If the
equipment is leased | ||||||
10 | in a manner that does not qualify for this exemption or is
used | ||||||
11 | in any other nonexempt manner, the lessor shall be liable for | ||||||
12 | the tax
imposed under this Act or the Service Use Tax Act, as | ||||||
13 | the case may be, based on
the fair market value of the property | ||||||
14 | at the time the nonqualifying use
occurs. No lessor shall | ||||||
15 | collect or attempt to collect an amount (however
designated) | ||||||
16 | that purports to reimburse that lessor for the tax imposed by | ||||||
17 | this
Act or the Service Use Tax Act, as the case may be, if the | ||||||
18 | tax has not been
paid by the lessor. If a lessor improperly | ||||||
19 | collects any such amount from the
lessee, the lessee shall | ||||||
20 | have a legal right to claim a refund of that amount
from the | ||||||
21 | lessor. If, however, that amount is not refunded to the lessee | ||||||
22 | for
any reason, the lessor is liable to pay that amount to the | ||||||
23 | Department.
This paragraph is exempt from the provisions of | ||||||
24 | Section 3-90.
| ||||||
25 | (32) Beginning on August 2, 2001 (the effective date of | ||||||
26 | Public Act 92-227),
personal property purchased by a lessor |
| |||||||
| |||||||
1 | who leases the property,
under a lease of one year or longer | ||||||
2 | executed or in effect at the time the
lessor would otherwise be | ||||||
3 | subject to the tax imposed by this Act, to a
governmental body | ||||||
4 | that has been issued an active sales tax exemption
| ||||||
5 | identification number by the Department under Section 1g of | ||||||
6 | the Retailers'
Occupation Tax Act. If the property is leased | ||||||
7 | in a manner that does not
qualify for this exemption or used in | ||||||
8 | any other nonexempt manner, the lessor
shall be liable for the | ||||||
9 | tax imposed under this Act or the Service Use Tax Act,
as the | ||||||
10 | case may be, based on the fair market value of the property at | ||||||
11 | the time
the nonqualifying use occurs. No lessor shall collect | ||||||
12 | or attempt to collect
an amount (however designated) that | ||||||
13 | purports to reimburse that lessor for the
tax imposed by this | ||||||
14 | Act or the Service Use Tax Act, as the case may be, if the
tax | ||||||
15 | has not been paid by the lessor. If a lessor improperly | ||||||
16 | collects any such
amount from the lessee, the lessee shall | ||||||
17 | have a legal right to claim a refund
of that amount from the | ||||||
18 | lessor. If, however, that amount is not refunded to
the lessee | ||||||
19 | for any reason, the lessor is liable to pay that amount to the
| ||||||
20 | Department. This paragraph is exempt from the provisions of | ||||||
21 | Section 3-90.
| ||||||
22 | (33) On and after July 1, 2003 and through June 30, 2004, | ||||||
23 | the use in this State of motor vehicles of
the second division | ||||||
24 | with a gross vehicle weight in excess of 8,000 pounds and
that | ||||||
25 | are subject to the commercial distribution fee imposed under | ||||||
26 | Section
3-815.1 of the Illinois Vehicle Code. Beginning on |
| |||||||
| |||||||
1 | July 1, 2004 and through June 30, 2005, the use in this State | ||||||
2 | of motor vehicles of the second division: (i) with a gross | ||||||
3 | vehicle weight rating in excess of 8,000 pounds; (ii) that are | ||||||
4 | subject to the commercial distribution fee imposed under | ||||||
5 | Section 3-815.1 of the Illinois Vehicle Code; and (iii) that | ||||||
6 | are primarily used for commercial purposes. Through June 30, | ||||||
7 | 2005, this exemption applies to repair and
replacement parts | ||||||
8 | added after the initial purchase of such a motor vehicle if
| ||||||
9 | that motor
vehicle is used in a manner that would qualify for | ||||||
10 | the rolling stock exemption
otherwise provided for in this | ||||||
11 | Act. For purposes of this paragraph, the term "used for | ||||||
12 | commercial purposes" means the transportation of persons or | ||||||
13 | property in furtherance of any commercial or industrial | ||||||
14 | enterprise, whether for-hire or not.
| ||||||
15 | (34) Beginning January 1, 2008, tangible personal property | ||||||
16 | used in the construction or maintenance of a community water | ||||||
17 | supply, as defined under Section 3.145 of the Environmental | ||||||
18 | Protection Act, that is operated by a not-for-profit | ||||||
19 | corporation that holds a valid water supply permit issued | ||||||
20 | under Title IV of the Environmental Protection Act. This | ||||||
21 | paragraph is exempt from the provisions of Section 3-90. | ||||||
22 | (35) Beginning January 1, 2010 and continuing through | ||||||
23 | December 31, 2024, materials, parts, equipment, components, | ||||||
24 | and furnishings incorporated into or upon an aircraft as part | ||||||
25 | of the modification, refurbishment, completion, replacement, | ||||||
26 | repair, or maintenance of the aircraft. This exemption |
| |||||||
| |||||||
1 | includes consumable supplies used in the modification, | ||||||
2 | refurbishment, completion, replacement, repair, and | ||||||
3 | maintenance of aircraft, but excludes any materials, parts, | ||||||
4 | equipment, components, and consumable supplies used in the | ||||||
5 | modification, replacement, repair, and maintenance of aircraft | ||||||
6 | engines or power plants, whether such engines or power plants | ||||||
7 | are installed or uninstalled upon any such aircraft. | ||||||
8 | "Consumable supplies" include, but are not limited to, | ||||||
9 | adhesive, tape, sandpaper, general purpose lubricants, | ||||||
10 | cleaning solution, latex gloves, and protective films. This | ||||||
11 | exemption applies only to the use of qualifying tangible | ||||||
12 | personal property by persons who modify, refurbish, complete, | ||||||
13 | repair, replace, or maintain aircraft and who (i) hold an Air | ||||||
14 | Agency Certificate and are empowered to operate an approved | ||||||
15 | repair station by the Federal Aviation Administration, (ii) | ||||||
16 | have a Class IV Rating, and (iii) conduct operations in | ||||||
17 | accordance with Part 145 of the Federal Aviation Regulations. | ||||||
18 | The exemption does not include aircraft operated by a | ||||||
19 | commercial air carrier providing scheduled passenger air | ||||||
20 | service pursuant to authority issued under Part 121 or Part | ||||||
21 | 129 of the Federal Aviation Regulations. The changes made to | ||||||
22 | this paragraph (35) by Public Act 98-534 are declarative of | ||||||
23 | existing law. It is the intent of the General Assembly that the | ||||||
24 | exemption under this paragraph (35) applies continuously from | ||||||
25 | January 1, 2010 through December 31, 2024; however, no claim | ||||||
26 | for credit or refund is allowed for taxes paid as a result of |
| |||||||
| |||||||
1 | the disallowance of this exemption on or after January 1, 2015 | ||||||
2 | and prior to the effective date of this amendatory Act of the | ||||||
3 | 101st General Assembly. | ||||||
4 | (36) Tangible personal property purchased by a | ||||||
5 | public-facilities corporation, as described in Section | ||||||
6 | 11-65-10 of the Illinois Municipal Code, for purposes of | ||||||
7 | constructing or furnishing a municipal convention hall, but | ||||||
8 | only if the legal title to the municipal convention hall is | ||||||
9 | transferred to the municipality without any further | ||||||
10 | consideration by or on behalf of the municipality at the time | ||||||
11 | of the completion of the municipal convention hall or upon the | ||||||
12 | retirement or redemption of any bonds or other debt | ||||||
13 | instruments issued by the public-facilities corporation in | ||||||
14 | connection with the development of the municipal convention | ||||||
15 | hall. This exemption includes existing public-facilities | ||||||
16 | corporations as provided in Section 11-65-25 of the Illinois | ||||||
17 | Municipal Code. This paragraph is exempt from the provisions | ||||||
18 | of Section 3-90. | ||||||
19 | (37) Beginning January 1, 2017 and through December 31, | ||||||
20 | 2026, menstrual pads, tampons, and menstrual cups. | ||||||
21 | (38) Merchandise that is subject to the Rental Purchase | ||||||
22 | Agreement Occupation and Use Tax. The purchaser must certify | ||||||
23 | that the item is purchased to be rented subject to a rental | ||||||
24 | purchase agreement, as defined in the Rental Purchase | ||||||
25 | Agreement Act, and provide proof of registration under the | ||||||
26 | Rental Purchase Agreement Occupation and Use Tax Act. This |
| |||||||
| |||||||
1 | paragraph is exempt from the provisions of Section 3-90. | ||||||
2 | (39) Tangible personal property purchased by a purchaser | ||||||
3 | who is exempt from the tax imposed by this Act by operation of | ||||||
4 | federal law. This paragraph is exempt from the provisions of | ||||||
5 | Section 3-90. | ||||||
6 | (40) Qualified tangible personal property used in the | ||||||
7 | construction or operation of a data center that has been | ||||||
8 | granted a certificate of exemption by the Department of | ||||||
9 | Commerce and Economic Opportunity, whether that tangible | ||||||
10 | personal property is purchased by the owner, operator, or | ||||||
11 | tenant of the data center or by a contractor or subcontractor | ||||||
12 | of the owner, operator, or tenant. Data centers that would | ||||||
13 | have qualified for a certificate of exemption prior to January | ||||||
14 | 1, 2020 had Public Act 101-31 been in effect may apply for and | ||||||
15 | obtain an exemption for subsequent purchases of computer | ||||||
16 | equipment or enabling software purchased or leased to upgrade, | ||||||
17 | supplement, or replace computer equipment or enabling software | ||||||
18 | purchased or leased in the original investment that would have | ||||||
19 | qualified. | ||||||
20 | The Department of Commerce and Economic Opportunity shall | ||||||
21 | grant a certificate of exemption under this item (40) to | ||||||
22 | qualified data centers as defined by Section 605-1025 of the | ||||||
23 | Department of Commerce and Economic Opportunity Law of the
| ||||||
24 | Civil Administrative Code of Illinois. | ||||||
25 | For the purposes of this item (40): | ||||||
26 | "Data center" means a building or a series of |
| |||||||
| |||||||
1 | buildings rehabilitated or constructed to house working | ||||||
2 | servers in one physical location or multiple sites within | ||||||
3 | the State of Illinois. | ||||||
4 | "Qualified tangible personal property" means: | ||||||
5 | electrical systems and equipment; climate control and | ||||||
6 | chilling equipment and systems; mechanical systems and | ||||||
7 | equipment; monitoring and secure systems; emergency | ||||||
8 | generators; hardware; computers; servers; data storage | ||||||
9 | devices; network connectivity equipment; racks; cabinets; | ||||||
10 | telecommunications cabling infrastructure; raised floor | ||||||
11 | systems; peripheral components or systems; software; | ||||||
12 | mechanical, electrical, or plumbing systems; battery | ||||||
13 | systems; cooling systems and towers; temperature control | ||||||
14 | systems; other cabling; and other data center | ||||||
15 | infrastructure equipment and systems necessary to operate | ||||||
16 | qualified tangible personal property, including fixtures; | ||||||
17 | and component parts of any of the foregoing, including | ||||||
18 | installation, maintenance, repair, refurbishment, and | ||||||
19 | replacement of qualified tangible personal property to | ||||||
20 | generate, transform, transmit, distribute, or manage | ||||||
21 | electricity necessary to operate qualified tangible | ||||||
22 | personal property; and all other tangible personal | ||||||
23 | property that is essential to the operations of a computer | ||||||
24 | data center. The term "qualified tangible personal | ||||||
25 | property" also includes building materials physically | ||||||
26 | incorporated in to the qualifying data center. To document |
| |||||||
| |||||||
1 | the exemption allowed under this Section, the retailer | ||||||
2 | must obtain from the purchaser a copy of the certificate | ||||||
3 | of eligibility issued by the Department of Commerce and | ||||||
4 | Economic Opportunity. | ||||||
5 | This item (40) is exempt from the provisions of Section | ||||||
6 | 3-90. | ||||||
7 | (41) Beginning on the earlier of: (i) January 1, 2025; or | ||||||
8 | (ii) January 1 of the calendar year immediately following the | ||||||
9 | calendar year in which the State reports to the United States | ||||||
10 | Department of the Treasury that all federal funds received | ||||||
11 | under the American Rescue Plan Act of 2021 have been fully | ||||||
12 | expended, and continuing through December 31 of the fifth | ||||||
13 | calendar year to occur after the earlier of: (i) January 1, | ||||||
14 | 2025; or (ii) January 1 of the calendar year immediately | ||||||
15 | following the calendar year in which the State reports to the | ||||||
16 | United States Department of the Treasury that all federal | ||||||
17 | funds received under the American Rescue Plan Act of 2021 have | ||||||
18 | been fully expended, equipment and material deployed after | ||||||
19 | January 1, 2023 in a county in the State with a population of | ||||||
20 | fewer than 40,000 people or a township in the State with a | ||||||
21 | population density of less than 50 households per square mile | ||||||
22 | in a county with a population of less than 300,000 people | ||||||
23 | during that year that is incorporated into or used in the | ||||||
24 | business of providing broadband services, including all | ||||||
25 | equipment and material, machinery, software, or other tangible | ||||||
26 | personal property that is used in whole or in part in |
| |||||||
| |||||||
1 | producing, broadcasting, distributing, sending, receiving, | ||||||
2 | storing, transmitting, retransmitting, amplifying, switching, | ||||||
3 | or routing broadband services, including the monitoring, | ||||||
4 | testing, maintaining, enabling, or facilitating of such | ||||||
5 | equipment, machinery, software, or other infrastructure. Such | ||||||
6 | property includes, but is not limited to, wires, cables | ||||||
7 | including fiber optic cables, antennas, poles, switches, | ||||||
8 | routers, amplifiers, rectifiers, repeaters, receivers, | ||||||
9 | multiplexers, duplexers, transmitters, power equipment, backup | ||||||
10 | power equipment, diagnostic equipment, storage devices, | ||||||
11 | modems, and other general central office equipment, such as | ||||||
12 | channel cards, frames, and cabinets. The exemption under this | ||||||
13 | item (41) may be taken for property placed in service on or | ||||||
14 | after January 1, 2023; however, the credit may not be taken | ||||||
15 | until a taxable year beginning on or after the earlier of: (i) | ||||||
16 | January 1, 2025; or (ii) January 1 of the calendar year | ||||||
17 | immediately following the calendar year in which the State | ||||||
18 | reports to the United States Department of the Treasury that | ||||||
19 | all federal funds received under the American Rescue Plan Act | ||||||
20 | of 2021 have been fully expended. | ||||||
21 | (Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19; | ||||||
22 | 101-81, eff. 7-12-19; 101-629, eff. 2-5-20; 102-16, eff. | ||||||
23 | 6-17-21.)
| ||||||
24 | Section 15. The Service Use Tax Act is amended by changing | ||||||
25 | Sections 2 and 3-5 as follows:
|
| |||||||
| |||||||
1 | (35 ILCS 110/2) (from Ch. 120, par. 439.32)
| ||||||
2 | Sec. 2. Definitions. In this Act: | ||||||
3 | "Broadband service" means a service provided by wireline | ||||||
4 | or wireless means capable of delivering high-speed internet | ||||||
5 | access at speeds of at least 25 megabits per second of download | ||||||
6 | speed and 3 megabits per second of upload speed. | ||||||
7 | "Use" means the exercise by any person of any right or | ||||||
8 | power
over tangible personal property incident to the | ||||||
9 | ownership of that
property, but does not include the sale or | ||||||
10 | use for demonstration by him
of that property in any form as | ||||||
11 | tangible personal property in the
regular course of business.
| ||||||
12 | "Use" does not mean the interim
use of
tangible personal | ||||||
13 | property nor the physical incorporation of tangible
personal | ||||||
14 | property, as an ingredient or constituent, into other tangible
| ||||||
15 | personal property, (a) which is sold in the regular course of | ||||||
16 | business
or (b) which the person incorporating such ingredient | ||||||
17 | or constituent
therein has undertaken at the time of such | ||||||
18 | purchase to cause to be
transported in interstate commerce to | ||||||
19 | destinations outside the State of
Illinois.
| ||||||
20 | "Purchased from a serviceman" means the acquisition of the | ||||||
21 | ownership
of, or title to, tangible personal property through | ||||||
22 | a sale of service.
| ||||||
23 | "Purchaser" means any person who, through a sale of | ||||||
24 | service, acquires
the ownership of, or title to, any tangible | ||||||
25 | personal property.
|
| |||||||
| |||||||
1 | "Cost price" means the consideration paid by the | ||||||
2 | serviceman for a
purchase valued in money, whether paid in | ||||||
3 | money or otherwise, including
cash, credits and services, and | ||||||
4 | shall be determined without any
deduction on account of the | ||||||
5 | supplier's cost of the property sold or on
account of any other | ||||||
6 | expense incurred by the supplier. When a serviceman
contracts | ||||||
7 | out part or all of the services required in his sale of | ||||||
8 | service,
it shall be presumed that the cost price to the | ||||||
9 | serviceman of the property
transferred to him or her by his or | ||||||
10 | her subcontractor is equal to 50% of
the subcontractor's | ||||||
11 | charges to the serviceman in the absence of proof of
the | ||||||
12 | consideration paid by the subcontractor for the purchase of | ||||||
13 | such property.
| ||||||
14 | "Selling price" means the consideration for a sale valued | ||||||
15 | in money
whether received in money or otherwise, including | ||||||
16 | cash, credits and
service, and shall be determined without any | ||||||
17 | deduction on account of the
serviceman's cost of the property | ||||||
18 | sold, the cost of materials used,
labor or service cost or any | ||||||
19 | other expense whatsoever, but does not
include interest or | ||||||
20 | finance charges which appear as separate items on
the bill of | ||||||
21 | sale or sales contract nor charges that are added to prices
by | ||||||
22 | sellers on account of the seller's duty to collect, from the
| ||||||
23 | purchaser, the tax that is imposed by this Act.
| ||||||
24 | "Department" means the Department of Revenue.
| ||||||
25 | "Person" means any natural individual, firm, partnership,
| ||||||
26 | association, joint stock company, joint venture, public or |
| |||||||
| |||||||
1 | private
corporation, limited liability company, and any | ||||||
2 | receiver, executor, trustee,
guardian or other representative | ||||||
3 | appointed by order of any court.
| ||||||
4 | "Sale of service" means any transaction except:
| ||||||
5 | (1) a retail sale of tangible personal property | ||||||
6 | taxable under the
Retailers' Occupation Tax Act or under | ||||||
7 | the Use Tax Act.
| ||||||
8 | (2) a sale of tangible personal property for the | ||||||
9 | purpose of resale
made in compliance with Section 2c of | ||||||
10 | the Retailers' Occupation Tax Act.
| ||||||
11 | (3) except as hereinafter provided, a sale or transfer | ||||||
12 | of tangible
personal property as an incident to the | ||||||
13 | rendering of service for or by
any governmental body, or | ||||||
14 | for or by any corporation, society,
association, | ||||||
15 | foundation or institution organized and operated
| ||||||
16 | exclusively for charitable, religious or educational | ||||||
17 | purposes or any
not-for-profit corporation, society, | ||||||
18 | association, foundation,
institution or organization which | ||||||
19 | has no compensated officers or
employees and which is | ||||||
20 | organized and operated primarily for the
recreation of | ||||||
21 | persons 55 years of age or older. A limited liability | ||||||
22 | company
may qualify for the exemption under this paragraph | ||||||
23 | only if the limited
liability company is organized and | ||||||
24 | operated exclusively for educational
purposes.
| ||||||
25 | (4) (blank).
| ||||||
26 | (4a) a sale or transfer of tangible personal
property |
| |||||||
| |||||||
1 | as an incident
to the rendering of service for owners, | ||||||
2 | lessors, or shippers of tangible
personal property which | ||||||
3 | is utilized by interstate carriers for hire for
use as | ||||||
4 | rolling stock moving in interstate commerce so long as so | ||||||
5 | used by
interstate carriers for hire, and equipment | ||||||
6 | operated by a
telecommunications provider, licensed as a | ||||||
7 | common carrier by the Federal
Communications Commission, | ||||||
8 | which is permanently installed in or affixed to
aircraft | ||||||
9 | moving in interstate commerce.
| ||||||
10 | (4a-5) on and after July 1, 2003 and through June 30, | ||||||
11 | 2004, a sale or transfer of a motor vehicle
of
the
second | ||||||
12 | division with a gross vehicle weight in excess of 8,000 | ||||||
13 | pounds as an
incident to the rendering of service if that | ||||||
14 | motor
vehicle is subject
to the commercial distribution | ||||||
15 | fee imposed under Section 3-815.1 of the
Illinois Vehicle
| ||||||
16 | Code. Beginning on July 1, 2004 and through June 30, 2005, | ||||||
17 | the use in this State of motor vehicles of the second | ||||||
18 | division: (i) with a gross vehicle weight rating in excess | ||||||
19 | of 8,000 pounds; (ii) that are subject to the commercial | ||||||
20 | distribution fee imposed under Section 3-815.1 of the | ||||||
21 | Illinois Vehicle Code; and (iii) that are primarily used | ||||||
22 | for commercial purposes. Through June 30, 2005, this
| ||||||
23 | exemption applies to repair and replacement parts added | ||||||
24 | after the
initial
purchase of such a motor vehicle if that | ||||||
25 | motor vehicle is used in a manner that
would
qualify for | ||||||
26 | the rolling stock exemption otherwise provided for in this |
| |||||||
| |||||||
1 | Act. For purposes of this paragraph, "used for commercial | ||||||
2 | purposes" means the transportation of persons or property | ||||||
3 | in furtherance of any commercial or industrial enterprise | ||||||
4 | whether for-hire or not.
| ||||||
5 | (5) a sale or transfer of machinery and equipment used | ||||||
6 | primarily in the
process of the manufacturing or | ||||||
7 | assembling, either in an existing, an expanded
or a new | ||||||
8 | manufacturing facility, of tangible personal property for | ||||||
9 | wholesale or
retail sale or lease, whether such sale or | ||||||
10 | lease is made directly by the
manufacturer or by some | ||||||
11 | other person, whether the materials used in the process
| ||||||
12 | are owned by the manufacturer or some other person, or | ||||||
13 | whether such sale or
lease is made apart from or as an | ||||||
14 | incident to the seller's engaging in a
service occupation | ||||||
15 | and the applicable tax is a Service Use Tax or Service
| ||||||
16 | Occupation Tax, rather than Use Tax or Retailers' | ||||||
17 | Occupation Tax. The exemption provided by this paragraph | ||||||
18 | (5) includes production related tangible personal | ||||||
19 | property, as defined in Section 3-50 of the Use Tax Act, | ||||||
20 | purchased on or after July 1, 2019. The exemption provided | ||||||
21 | by this paragraph (5) does not include machinery and | ||||||
22 | equipment used in (i) the generation of electricity for | ||||||
23 | wholesale or retail sale; (ii) the generation or treatment | ||||||
24 | of natural or artificial gas for wholesale or retail sale | ||||||
25 | that is delivered to customers through pipes, pipelines, | ||||||
26 | or mains; or (iii) the treatment of water for wholesale or |
| |||||||
| |||||||
1 | retail sale that is delivered to customers through pipes, | ||||||
2 | pipelines, or mains. The provisions of Public Act 98-583 | ||||||
3 | are declaratory of existing law as to the meaning and | ||||||
4 | scope of this exemption. The exemption under this | ||||||
5 | paragraph (5) is exempt from the provisions of Section | ||||||
6 | 3-75.
| ||||||
7 | (5a) the repairing, reconditioning or remodeling, for | ||||||
8 | a
common carrier by rail, of tangible personal property | ||||||
9 | which belongs to such
carrier for hire, and as to which | ||||||
10 | such carrier receives the physical possession
of the | ||||||
11 | repaired, reconditioned or remodeled item of tangible | ||||||
12 | personal property
in Illinois, and which such carrier | ||||||
13 | transports, or shares with another common
carrier in the | ||||||
14 | transportation of such property, out of Illinois on a | ||||||
15 | standard
uniform bill of lading showing the person who | ||||||
16 | repaired, reconditioned or
remodeled the property to a | ||||||
17 | destination outside Illinois, for use outside
Illinois.
| ||||||
18 | (5b) a sale or transfer of tangible personal property | ||||||
19 | which is produced by
the seller thereof on special order | ||||||
20 | in such a way as to have made the
applicable tax the | ||||||
21 | Service Occupation Tax or the Service Use Tax, rather than
| ||||||
22 | the Retailers' Occupation Tax or the Use Tax, for an | ||||||
23 | interstate carrier by rail
which receives the physical | ||||||
24 | possession of such property in Illinois, and which
| ||||||
25 | transports such property, or shares with another common | ||||||
26 | carrier in the
transportation of such property, out of |
| |||||||
| |||||||
1 | Illinois on a standard uniform bill of
lading showing the | ||||||
2 | seller of the property as the shipper or consignor of such
| ||||||
3 | property to a destination outside Illinois, for use | ||||||
4 | outside Illinois.
| ||||||
5 | (6) until July 1, 2003, a sale or transfer of | ||||||
6 | distillation machinery
and equipment, sold
as a unit or | ||||||
7 | kit and assembled or installed by the retailer, which
| ||||||
8 | machinery and equipment is certified by the user to be | ||||||
9 | used only for the
production of ethyl alcohol that will be | ||||||
10 | used for consumption as motor fuel
or as a component of | ||||||
11 | motor fuel for the personal use of such user and not
| ||||||
12 | subject to sale or resale.
| ||||||
13 | (7) at the election of any serviceman not required to | ||||||
14 | be
otherwise registered as a retailer under Section 2a of | ||||||
15 | the Retailers'
Occupation Tax Act, made for each fiscal | ||||||
16 | year sales
of service in which the aggregate annual cost | ||||||
17 | price of tangible
personal property transferred as an | ||||||
18 | incident to the sales of service is
less than 35%, or 75% | ||||||
19 | in the case of servicemen transferring prescription
drugs | ||||||
20 | or servicemen engaged in graphic arts production, of the | ||||||
21 | aggregate
annual total gross receipts from all sales of | ||||||
22 | service. The purchase of
such tangible personal property | ||||||
23 | by the serviceman shall be subject to tax
under the | ||||||
24 | Retailers' Occupation Tax Act and the Use Tax Act.
| ||||||
25 | However, if a
primary serviceman who has made the election | ||||||
26 | described in this paragraph
subcontracts service work to a |
| |||||||
| |||||||
1 | secondary serviceman who has also made the
election | ||||||
2 | described in this paragraph, the primary serviceman does | ||||||
3 | not
incur a Use Tax liability if the secondary serviceman | ||||||
4 | (i) has paid or will pay
Use
Tax on his or her cost price | ||||||
5 | of any tangible personal property transferred
to the | ||||||
6 | primary serviceman and (ii) certifies that fact in writing | ||||||
7 | to the
primary
serviceman.
| ||||||
8 | Tangible personal property transferred incident to the | ||||||
9 | completion of a
maintenance agreement is exempt from the tax | ||||||
10 | imposed pursuant to this Act.
| ||||||
11 | Exemption (5) also includes machinery and equipment used | ||||||
12 | in the general
maintenance or repair of such exempt machinery | ||||||
13 | and equipment or for in-house
manufacture of exempt machinery | ||||||
14 | and equipment. On and after July 1, 2017, exemption (5) also
| ||||||
15 | includes graphic arts machinery and equipment, as
defined in | ||||||
16 | paragraph (5) of Section 3-5. The machinery and equipment | ||||||
17 | exemption does not include machinery and equipment used in (i) | ||||||
18 | the generation of electricity for wholesale or retail sale; | ||||||
19 | (ii) the generation or treatment of natural or artificial gas | ||||||
20 | for wholesale or retail sale that is delivered to customers | ||||||
21 | through pipes, pipelines, or mains; or (iii) the treatment of | ||||||
22 | water for wholesale or retail sale that is delivered to | ||||||
23 | customers through pipes, pipelines, or mains. The provisions | ||||||
24 | of Public Act 98-583 are declaratory of existing law as to the | ||||||
25 | meaning and scope of this exemption. For the purposes of | ||||||
26 | exemption
(5), each of these terms shall have the following |
| |||||||
| |||||||
1 | meanings: (1) "manufacturing
process" shall mean the | ||||||
2 | production of any article of tangible personal
property, | ||||||
3 | whether such article is a finished product or an article for | ||||||
4 | use in
the process of manufacturing or assembling a different | ||||||
5 | article of tangible
personal property, by procedures commonly | ||||||
6 | regarded as manufacturing,
processing, fabricating, or | ||||||
7 | refining which changes some existing
material or materials | ||||||
8 | into a material with a different form, use or
name. In relation | ||||||
9 | to a recognized integrated business composed of a
series of | ||||||
10 | operations which collectively constitute manufacturing, or
| ||||||
11 | individually constitute manufacturing operations, the | ||||||
12 | manufacturing
process shall be deemed to commence with the | ||||||
13 | first operation or stage of
production in the series, and | ||||||
14 | shall not be deemed to end until the
completion of the final | ||||||
15 | product in the last operation or stage of
production in the | ||||||
16 | series; and further, for purposes of exemption (5),
| ||||||
17 | photoprocessing is deemed to be a manufacturing process of | ||||||
18 | tangible
personal property for wholesale or retail sale; (2) | ||||||
19 | "assembling process" shall
mean the production of any article | ||||||
20 | of tangible personal property, whether such
article is a | ||||||
21 | finished product or an article for use in the process of
| ||||||
22 | manufacturing or assembling a different article of tangible | ||||||
23 | personal
property, by the combination of existing materials in | ||||||
24 | a manner commonly
regarded as assembling which results in a | ||||||
25 | material of a different form,
use or name; (3) "machinery" | ||||||
26 | shall mean major mechanical machines or
major components of |
| |||||||
| |||||||
1 | such machines contributing to a manufacturing or
assembling | ||||||
2 | process; and (4) "equipment" shall include any independent
| ||||||
3 | device or tool separate from any machinery but essential to an
| ||||||
4 | integrated manufacturing or assembly process; including | ||||||
5 | computers
used primarily in a manufacturer's computer
assisted | ||||||
6 | design, computer assisted manufacturing (CAD/CAM) system;
or | ||||||
7 | any subunit or assembly comprising a component of any | ||||||
8 | machinery or
auxiliary, adjunct or attachment parts of | ||||||
9 | machinery, such as tools, dies,
jigs, fixtures, patterns and | ||||||
10 | molds; or any parts which require periodic
replacement in the | ||||||
11 | course of normal operation; but shall not include hand
tools.
| ||||||
12 | Equipment includes chemicals or chemicals acting as catalysts | ||||||
13 | but only if the
chemicals or chemicals acting as catalysts | ||||||
14 | effect a direct and immediate change
upon a
product being | ||||||
15 | manufactured or assembled for wholesale or retail sale or
| ||||||
16 | lease.
The purchaser of such machinery and equipment who has | ||||||
17 | an active
resale registration number shall furnish such number | ||||||
18 | to the seller at the
time of purchase. The purchaser of such | ||||||
19 | machinery and equipment and tools
without an active resale | ||||||
20 | registration number shall prepare a certificate of
exemption | ||||||
21 | stating facts establishing the exemption, which certificate | ||||||
22 | shall be available to the Department
for inspection or audit. | ||||||
23 | The Department shall prescribe the form of the
certificate.
| ||||||
24 | Any informal rulings, opinions or letters issued by the | ||||||
25 | Department in
response to an inquiry or request for any | ||||||
26 | opinion from any person
regarding the coverage and |
| |||||||
| |||||||
1 | applicability of exemption (5) to specific
devices shall be | ||||||
2 | published, maintained as a public record, and made
available | ||||||
3 | for public inspection and copying. If the informal ruling,
| ||||||
4 | opinion or letter contains trade secrets or other confidential
| ||||||
5 | information, where possible the Department shall delete such | ||||||
6 | information
prior to publication. Whenever such informal | ||||||
7 | rulings, opinions, or
letters contain any policy of general | ||||||
8 | applicability, the Department
shall formulate and adopt such | ||||||
9 | policy as a rule in accordance with the
provisions of the | ||||||
10 | Illinois Administrative Procedure Act.
| ||||||
11 | On and after July 1, 1987, no entity otherwise eligible | ||||||
12 | under exemption
(3) of this Section shall make tax-free | ||||||
13 | purchases unless it has an active
exemption identification | ||||||
14 | number issued by the Department.
| ||||||
15 | The purchase, employment and transfer of such tangible | ||||||
16 | personal
property as newsprint and ink for the primary purpose | ||||||
17 | of conveying news
(with or without other information) is not a | ||||||
18 | purchase, use or sale of
service or of tangible personal | ||||||
19 | property within the meaning of this Act.
| ||||||
20 | "Serviceman" means any person who is engaged in the | ||||||
21 | occupation of
making sales of service.
| ||||||
22 | "Sale at retail" means "sale at retail" as defined in the | ||||||
23 | Retailers'
Occupation Tax Act.
| ||||||
24 | "Supplier" means any person who makes sales of tangible | ||||||
25 | personal
property to servicemen for the purpose of resale as | ||||||
26 | an incident to a
sale of service.
|
| |||||||
| |||||||
1 | "Serviceman maintaining a place of business in this | ||||||
2 | State", or any
like term, means and includes any serviceman:
| ||||||
3 | (1) having or maintaining within this State, directly | ||||||
4 | or by a
subsidiary, an office, distribution house, sales | ||||||
5 | house, warehouse or
other place of business, or any agent | ||||||
6 | or other representative operating
within this State under | ||||||
7 | the authority of the serviceman or its
subsidiary, | ||||||
8 | irrespective of whether such place of business or agent or
| ||||||
9 | other representative is located here permanently or | ||||||
10 | temporarily, or
whether such serviceman or subsidiary is | ||||||
11 | licensed to do business in this
State; | ||||||
12 | (1.1) having a contract with a person located in this | ||||||
13 | State under which the person, for a commission or other | ||||||
14 | consideration based on the sale of service by the | ||||||
15 | serviceman, directly or indirectly refers potential | ||||||
16 | customers to the serviceman by providing to the potential | ||||||
17 | customers a promotional code or other mechanism that | ||||||
18 | allows the serviceman to track purchases referred by such | ||||||
19 | persons. Examples of mechanisms that allow the serviceman | ||||||
20 | to track purchases referred by such persons include but | ||||||
21 | are not limited to the use of a link on the person's | ||||||
22 | Internet website, promotional codes distributed through | ||||||
23 | the person's hand-delivered or mailed material, and | ||||||
24 | promotional codes distributed by the person through radio | ||||||
25 | or other broadcast media. The provisions of this paragraph | ||||||
26 | (1.1) shall apply only if the cumulative gross receipts |
| |||||||
| |||||||
1 | from sales of service by the serviceman to customers who | ||||||
2 | are referred to the serviceman by all persons in this | ||||||
3 | State under such contracts exceed $10,000 during the | ||||||
4 | preceding 4 quarterly periods ending on the last day of | ||||||
5 | March, June, September, and December; a serviceman meeting | ||||||
6 | the requirements of this paragraph (1.1) shall be presumed | ||||||
7 | to be maintaining a place of business in this State but may | ||||||
8 | rebut this presumption by submitting proof that the | ||||||
9 | referrals or other activities pursued within this State by | ||||||
10 | such persons were not sufficient to meet the nexus | ||||||
11 | standards of the United States Constitution during the | ||||||
12 | preceding 4 quarterly periods; | ||||||
13 | (1.2) beginning July 1, 2011, having a contract with a | ||||||
14 | person located in this State under which: | ||||||
15 | (A) the serviceman sells the same or substantially | ||||||
16 | similar line of services as the person located in this | ||||||
17 | State and does so using an identical or substantially | ||||||
18 | similar name, trade name, or trademark as the person | ||||||
19 | located in this State; and | ||||||
20 | (B) the serviceman provides a commission or other | ||||||
21 | consideration to the person located in this State | ||||||
22 | based upon the sale of services by the serviceman. | ||||||
23 | The provisions of this paragraph (1.2) shall apply only if | ||||||
24 | the cumulative gross receipts from sales of service by the | ||||||
25 | serviceman to customers in this State under all such | ||||||
26 | contracts exceed $10,000 during the preceding 4 quarterly |
| |||||||
| |||||||
1 | periods ending on the last day of March, June, September, | ||||||
2 | and December;
| ||||||
3 | (2) soliciting orders for tangible personal property | ||||||
4 | by means of a
telecommunication or television shopping | ||||||
5 | system (which utilizes toll free
numbers) which is | ||||||
6 | intended by the retailer to be broadcast by cable
| ||||||
7 | television or other means of broadcasting, to consumers | ||||||
8 | located in this State;
| ||||||
9 | (3) pursuant to a contract with a broadcaster or | ||||||
10 | publisher located in this
State, soliciting orders for | ||||||
11 | tangible personal property by means of advertising
which | ||||||
12 | is disseminated primarily to consumers located in this | ||||||
13 | State and only
secondarily to bordering jurisdictions;
| ||||||
14 | (4) soliciting orders for tangible personal property | ||||||
15 | by mail if the
solicitations are substantial and recurring | ||||||
16 | and if the retailer benefits
from any banking, financing, | ||||||
17 | debt collection, telecommunication, or
marketing | ||||||
18 | activities occurring in this State or benefits from the | ||||||
19 | location
in this State of authorized installation, | ||||||
20 | servicing, or repair facilities;
| ||||||
21 | (5) being owned or controlled by the same interests | ||||||
22 | which own or
control any retailer engaging in business in | ||||||
23 | the same or similar line of
business in this State;
| ||||||
24 | (6) having a franchisee or licensee operating under | ||||||
25 | its trade name if
the franchisee or licensee is required | ||||||
26 | to collect the tax under this Section;
|
| |||||||
| |||||||
1 | (7) pursuant to a contract with a cable television | ||||||
2 | operator located in
this State, soliciting orders for | ||||||
3 | tangible personal property by means of
advertising which | ||||||
4 | is transmitted or distributed over a cable television
| ||||||
5 | system in this State;
| ||||||
6 | (8) engaging in activities in Illinois, which | ||||||
7 | activities in the
state in which the supply business | ||||||
8 | engaging in such activities is located
would constitute | ||||||
9 | maintaining a place of business in that state; or
| ||||||
10 | (9) beginning October 1, 2018, making sales of service | ||||||
11 | to purchasers in Illinois from outside of Illinois if: | ||||||
12 | (A) the cumulative gross receipts from sales of | ||||||
13 | service to purchasers in Illinois are $100,000 or | ||||||
14 | more; or | ||||||
15 | (B) the serviceman enters into 200 or more | ||||||
16 | separate transactions for sales of service to | ||||||
17 | purchasers in Illinois. | ||||||
18 | The serviceman shall determine on a quarterly basis, | ||||||
19 | ending on the last day of March, June, September, and | ||||||
20 | December, whether he or she meets the criteria of either | ||||||
21 | subparagraph (A) or (B) of this paragraph (9) for the | ||||||
22 | preceding 12-month period. If the serviceman meets the | ||||||
23 | criteria of either subparagraph (A) or (B) for a 12-month | ||||||
24 | period, he or she is considered a serviceman maintaining a | ||||||
25 | place of business in this State and is required to collect | ||||||
26 | and remit the tax imposed under this Act and file returns |
| |||||||
| |||||||
1 | for one year. At the end of that one-year period, the | ||||||
2 | serviceman shall determine whether the serviceman met the | ||||||
3 | criteria of either subparagraph (A) or (B) during the | ||||||
4 | preceding 12-month period. If the serviceman met the | ||||||
5 | criteria in either subparagraph (A) or (B) for the | ||||||
6 | preceding 12-month period, he or she is considered a | ||||||
7 | serviceman maintaining a place of business in this State | ||||||
8 | and is required to collect and remit the tax imposed under | ||||||
9 | this Act and file returns for the subsequent year. If at | ||||||
10 | the end of a one-year period a serviceman that was | ||||||
11 | required to collect and remit the tax imposed under this | ||||||
12 | Act determines that he or she did not meet the criteria in | ||||||
13 | either subparagraph (A) or (B) during the preceding | ||||||
14 | 12-month period, the serviceman subsequently shall | ||||||
15 | determine on a quarterly basis, ending on the last day of | ||||||
16 | March, June, September, and December, whether he or she | ||||||
17 | meets the criteria of either subparagraph (A) or (B) for | ||||||
18 | the preceding 12-month period. | ||||||
19 | Beginning January 1, 2020, neither the gross receipts | ||||||
20 | from nor the number of separate transactions for sales of | ||||||
21 | service to purchasers in Illinois that a serviceman makes | ||||||
22 | through a marketplace facilitator and for which the | ||||||
23 | serviceman has received a certification from the | ||||||
24 | marketplace facilitator pursuant to Section 2d of this Act | ||||||
25 | shall be included for purposes of determining whether he | ||||||
26 | or she has met the thresholds of this paragraph (9). |
| |||||||
| |||||||
1 | (10) Beginning January 1, 2020, a marketplace | ||||||
2 | facilitator, as defined in Section 2d of this Act. | ||||||
3 | (Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17; | ||||||
4 | 100-587, eff. 6-4-18; 100-863, eff. 8-14-18; 101-9, Article | ||||||
5 | 10, Section 10-15, eff. 6-5-19; 101-9, Article 25, Section | ||||||
6 | 25-10, eff. 6-5-19; 101-604, eff. 12-13-19.)
| ||||||
7 | (35 ILCS 110/3-5)
| ||||||
8 | Sec. 3-5. Exemptions. Use of the following tangible | ||||||
9 | personal property
is exempt from the tax imposed by this Act:
| ||||||
10 | (1) Personal property purchased from a corporation, | ||||||
11 | society,
association, foundation, institution, or | ||||||
12 | organization, other than a limited
liability company, that is | ||||||
13 | organized and operated as a not-for-profit service
enterprise | ||||||
14 | for the benefit of persons 65 years of age or older if the | ||||||
15 | personal
property was not purchased by the enterprise for the | ||||||
16 | purpose of resale by the
enterprise.
| ||||||
17 | (2) Personal property purchased by a non-profit Illinois | ||||||
18 | county fair
association for use in conducting, operating, or | ||||||
19 | promoting the county fair.
| ||||||
20 | (3) Personal property purchased by a not-for-profit arts
| ||||||
21 | or cultural
organization that establishes, by proof required | ||||||
22 | by the Department by rule,
that it has received an exemption | ||||||
23 | under Section 501(c)(3) of the Internal
Revenue Code and that | ||||||
24 | is organized and operated primarily for the
presentation
or | ||||||
25 | support of arts or cultural programming, activities, or |
| |||||||
| |||||||
1 | services. These
organizations include, but are not limited to, | ||||||
2 | music and dramatic arts
organizations such as symphony | ||||||
3 | orchestras and theatrical groups, arts and
cultural service | ||||||
4 | organizations, local arts councils, visual arts organizations,
| ||||||
5 | and media arts organizations.
On and after July 1, 2001 (the | ||||||
6 | effective date of Public Act 92-35), however, an entity | ||||||
7 | otherwise eligible for this exemption shall not
make tax-free | ||||||
8 | purchases unless it has an active identification number issued | ||||||
9 | by
the Department.
| ||||||
10 | (4) Legal tender, currency, medallions, or gold or silver | ||||||
11 | coinage issued
by the State of Illinois, the government of the | ||||||
12 | United States of America,
or the government of any foreign | ||||||
13 | country, and bullion.
| ||||||
14 | (5) Until July 1, 2003 and beginning again on September 1, | ||||||
15 | 2004 through August 30, 2014, graphic arts machinery and | ||||||
16 | equipment, including
repair and
replacement parts, both new | ||||||
17 | and used, and including that manufactured on
special order or | ||||||
18 | purchased for lease, certified by the purchaser to be used
| ||||||
19 | primarily for graphic arts production.
Equipment includes | ||||||
20 | chemicals or
chemicals acting as catalysts but only if
the | ||||||
21 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
22 | immediate
change upon a graphic arts product. Beginning on | ||||||
23 | July 1, 2017, graphic arts machinery and equipment is included | ||||||
24 | in the manufacturing and assembling machinery and equipment | ||||||
25 | exemption under Section 2 of this Act.
| ||||||
26 | (6) Personal property purchased from a teacher-sponsored |
| |||||||
| |||||||
1 | student
organization affiliated with an elementary or | ||||||
2 | secondary school located
in Illinois.
| ||||||
3 | (7) Farm machinery and equipment, both new and used, | ||||||
4 | including that
manufactured on special order, certified by the | ||||||
5 | purchaser to be used
primarily for production agriculture or | ||||||
6 | State or federal agricultural
programs, including individual | ||||||
7 | replacement parts for the machinery and
equipment, including | ||||||
8 | machinery and equipment purchased for lease,
and including | ||||||
9 | implements of husbandry defined in Section 1-130 of
the | ||||||
10 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
11 | chemical and
fertilizer spreaders, and nurse wagons required | ||||||
12 | to be registered
under Section 3-809 of the Illinois Vehicle | ||||||
13 | Code,
but
excluding other motor vehicles required to be | ||||||
14 | registered under the Illinois
Vehicle Code.
Horticultural | ||||||
15 | polyhouses or hoop houses used for propagating, growing, or
| ||||||
16 | overwintering plants shall be considered farm machinery and | ||||||
17 | equipment under
this item (7).
Agricultural chemical tender | ||||||
18 | tanks and dry boxes shall include units sold
separately from a | ||||||
19 | motor vehicle required to be licensed and units sold mounted
| ||||||
20 | on a motor vehicle required to be licensed if the selling price | ||||||
21 | of the tender
is separately stated.
| ||||||
22 | Farm machinery and equipment shall include precision | ||||||
23 | farming equipment
that is
installed or purchased to be | ||||||
24 | installed on farm machinery and equipment
including, but not | ||||||
25 | limited to, tractors, harvesters, sprayers, planters,
seeders, | ||||||
26 | or spreaders.
Precision farming equipment includes, but is not |
| |||||||
| |||||||
1 | limited to,
soil testing sensors, computers, monitors, | ||||||
2 | software, global positioning
and mapping systems, and other | ||||||
3 | such equipment.
| ||||||
4 | Farm machinery and equipment also includes computers, | ||||||
5 | sensors, software, and
related equipment used primarily in the
| ||||||
6 | computer-assisted operation of production agriculture | ||||||
7 | facilities, equipment,
and activities such as, but
not limited | ||||||
8 | to,
the collection, monitoring, and correlation of
animal and | ||||||
9 | crop data for the purpose of
formulating animal diets and | ||||||
10 | agricultural chemicals. This item (7) is exempt
from the | ||||||
11 | provisions of
Section 3-75.
| ||||||
12 | (8) Until June 30, 2013, fuel and petroleum products sold | ||||||
13 | to or used by an air common
carrier, certified by the carrier | ||||||
14 | to be used for consumption, shipment, or
storage in the | ||||||
15 | conduct of its business as an air common carrier, for a
flight | ||||||
16 | destined for or returning from a location or locations
outside | ||||||
17 | the United States without regard to previous or subsequent | ||||||
18 | domestic
stopovers.
| ||||||
19 | Beginning July 1, 2013, fuel and petroleum products sold | ||||||
20 | to or used by an air carrier, certified by the carrier to be | ||||||
21 | used for consumption, shipment, or storage in the conduct of | ||||||
22 | its business as an air common carrier, for a flight that (i) is | ||||||
23 | engaged in foreign trade or is engaged in trade between the | ||||||
24 | United States and any of its possessions and (ii) transports | ||||||
25 | at least one individual or package for hire from the city of | ||||||
26 | origination to the city of final destination on the same |
| |||||||
| |||||||
1 | aircraft, without regard to a change in the flight number of | ||||||
2 | that aircraft. | ||||||
3 | (9) Proceeds of mandatory service charges separately | ||||||
4 | stated on
customers' bills for the purchase and consumption of | ||||||
5 | food and beverages
acquired as an incident to the purchase of a | ||||||
6 | service from a serviceman, to
the extent that the proceeds of | ||||||
7 | the service charge are in fact
turned over as tips or as a | ||||||
8 | substitute for tips to the employees who
participate directly | ||||||
9 | in preparing, serving, hosting or cleaning up the
food or | ||||||
10 | beverage function with respect to which the service charge is | ||||||
11 | imposed.
| ||||||
12 | (10) Until July 1, 2003, oil field exploration, drilling, | ||||||
13 | and production
equipment, including
(i) rigs and parts of | ||||||
14 | rigs, rotary rigs, cable tool
rigs, and workover rigs, (ii) | ||||||
15 | pipe and tubular goods, including casing and
drill strings, | ||||||
16 | (iii) pumps and pump-jack units, (iv) storage tanks and flow
| ||||||
17 | lines, (v) any individual replacement part for oil field | ||||||
18 | exploration,
drilling, and production equipment, and (vi) | ||||||
19 | machinery and equipment purchased
for lease; but
excluding | ||||||
20 | motor vehicles required to be registered under the Illinois
| ||||||
21 | Vehicle Code.
| ||||||
22 | (11) Proceeds from the sale of photoprocessing machinery | ||||||
23 | and
equipment, including repair and replacement parts, both | ||||||
24 | new and
used, including that manufactured on special order, | ||||||
25 | certified by the
purchaser to be used primarily for | ||||||
26 | photoprocessing, and including
photoprocessing machinery and |
| |||||||
| |||||||
1 | equipment purchased for lease.
| ||||||
2 | (12) Until July 1, 2023, coal and aggregate exploration, | ||||||
3 | mining, off-highway hauling,
processing,
maintenance, and | ||||||
4 | reclamation equipment, including
replacement parts and | ||||||
5 | equipment, and including
equipment purchased for lease, but | ||||||
6 | excluding motor vehicles required to be
registered under the | ||||||
7 | Illinois Vehicle Code. The changes made to this Section by | ||||||
8 | Public Act 97-767 apply on and after July 1, 2003, but no claim | ||||||
9 | for credit or refund is allowed on or after August 16, 2013 | ||||||
10 | (the effective date of Public Act 98-456)
for such taxes paid | ||||||
11 | during the period beginning July 1, 2003 and ending on August | ||||||
12 | 16, 2013 (the effective date of Public Act 98-456).
| ||||||
13 | (13) Semen used for artificial insemination of livestock | ||||||
14 | for direct
agricultural production.
| ||||||
15 | (14) Horses, or interests in horses, registered with and | ||||||
16 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
17 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
18 | Horse Association, United States
Trotting Association, or | ||||||
19 | Jockey Club, as appropriate, used for
purposes of breeding or | ||||||
20 | racing for prizes. This item (14) is exempt from the | ||||||
21 | provisions of Section 3-75, and the exemption provided for | ||||||
22 | under this item (14) applies for all periods beginning May 30, | ||||||
23 | 1995, but no claim for credit or refund is allowed on or after | ||||||
24 | January 1, 2008 (the effective date of Public Act 95-88) for | ||||||
25 | such taxes paid during the period beginning May 30, 2000 and | ||||||
26 | ending on January 1, 2008 (the effective date of Public Act |
| |||||||
| |||||||
1 | 95-88).
| ||||||
2 | (15) Computers and communications equipment utilized for | ||||||
3 | any
hospital
purpose
and equipment used in the diagnosis,
| ||||||
4 | analysis, or treatment of hospital patients purchased by a | ||||||
5 | lessor who leases
the
equipment, under a lease of one year or | ||||||
6 | longer executed or in effect at the
time
the lessor would | ||||||
7 | otherwise be subject to the tax imposed by this Act,
to a
| ||||||
8 | hospital
that has been issued an active tax exemption | ||||||
9 | identification number by the
Department under Section 1g of | ||||||
10 | the Retailers' Occupation Tax Act.
If the
equipment is leased | ||||||
11 | in a manner that does not qualify for
this exemption
or is used | ||||||
12 | in any other non-exempt manner,
the lessor shall be liable for | ||||||
13 | the
tax imposed under this Act or the Use Tax Act, as the case | ||||||
14 | may
be, based on the fair market value of the property at the | ||||||
15 | time the
non-qualifying use occurs. No lessor shall collect or | ||||||
16 | attempt to collect an
amount (however
designated) that | ||||||
17 | purports to reimburse that lessor for the tax imposed by this
| ||||||
18 | Act or the Use Tax Act, as the case may be, if the tax has not | ||||||
19 | been
paid by the lessor. If a lessor improperly collects any | ||||||
20 | such amount from the
lessee, the lessee shall have a legal | ||||||
21 | right to claim a refund of that amount
from the lessor. If, | ||||||
22 | however, that amount is not refunded to the lessee for
any | ||||||
23 | reason, the lessor is liable to pay that amount to the | ||||||
24 | Department.
| ||||||
25 | (16) Personal property purchased by a lessor who leases | ||||||
26 | the
property, under
a
lease of one year or longer executed or |
| |||||||
| |||||||
1 | in effect at the time
the lessor would otherwise be subject to | ||||||
2 | the tax imposed by this Act,
to a governmental body
that has | ||||||
3 | been issued an active tax exemption identification number by | ||||||
4 | the
Department under Section 1g of the Retailers' Occupation | ||||||
5 | Tax Act.
If the
property is leased in a manner that does not | ||||||
6 | qualify for
this exemption
or is used in any other non-exempt | ||||||
7 | manner,
the lessor shall be liable for the
tax imposed under | ||||||
8 | this Act or the Use Tax Act, as the case may
be, based on the | ||||||
9 | fair market value of the property at the time the
| ||||||
10 | non-qualifying use occurs. No lessor shall collect or attempt | ||||||
11 | to collect an
amount (however
designated) that purports to | ||||||
12 | reimburse that lessor for the tax imposed by this
Act or the | ||||||
13 | Use Tax Act, as the case may be, if the tax has not been
paid | ||||||
14 | by the lessor. If a lessor improperly collects any such amount | ||||||
15 | from the
lessee, the lessee shall have a legal right to claim a | ||||||
16 | refund of that amount
from the lessor. If, however, that | ||||||
17 | amount is not refunded to the lessee for
any reason, the lessor | ||||||
18 | is liable to pay that amount to the Department.
| ||||||
19 | (17) Beginning with taxable years ending on or after | ||||||
20 | December
31,
1995
and
ending with taxable years ending on or | ||||||
21 | before December 31, 2004,
personal property that is
donated | ||||||
22 | for disaster relief to be used in a State or federally declared
| ||||||
23 | disaster area in Illinois or bordering Illinois by a | ||||||
24 | manufacturer or retailer
that is registered in this State to a | ||||||
25 | corporation, society, association,
foundation, or institution | ||||||
26 | that has been issued a sales tax exemption
identification |
| |||||||
| |||||||
1 | number by the Department that assists victims of the disaster
| ||||||
2 | who reside within the declared disaster area.
| ||||||
3 | (18) Beginning with taxable years ending on or after | ||||||
4 | December
31, 1995 and
ending with taxable years ending on or | ||||||
5 | before December 31, 2004, personal
property that is used in | ||||||
6 | the performance of infrastructure repairs in this
State, | ||||||
7 | including but not limited to municipal roads and streets, | ||||||
8 | access roads,
bridges, sidewalks, waste disposal systems, | ||||||
9 | water and sewer line extensions,
water distribution and | ||||||
10 | purification facilities, storm water drainage and
retention | ||||||
11 | facilities, and sewage treatment facilities, resulting from a | ||||||
12 | State
or federally declared disaster in Illinois or bordering | ||||||
13 | Illinois when such
repairs are initiated on facilities located | ||||||
14 | in the declared disaster area
within 6 months after the | ||||||
15 | disaster.
| ||||||
16 | (19) Beginning July 1, 1999, game or game birds purchased | ||||||
17 | at a "game
breeding
and hunting preserve area" as that term is
| ||||||
18 | used in
the Wildlife Code. This paragraph is exempt from the | ||||||
19 | provisions
of
Section 3-75.
| ||||||
20 | (20) A motor vehicle, as that term is defined in Section | ||||||
21 | 1-146
of the
Illinois Vehicle Code, that is donated to a | ||||||
22 | corporation, limited liability
company, society, association, | ||||||
23 | foundation, or institution that is determined by
the | ||||||
24 | Department to be organized and operated exclusively for | ||||||
25 | educational
purposes. For purposes of this exemption, "a | ||||||
26 | corporation, limited liability
company, society, association, |
| |||||||
| |||||||
1 | foundation, or institution organized and
operated
exclusively | ||||||
2 | for educational purposes" means all tax-supported public | ||||||
3 | schools,
private schools that offer systematic instruction in | ||||||
4 | useful branches of
learning by methods common to public | ||||||
5 | schools and that compare favorably in
their scope and | ||||||
6 | intensity with the course of study presented in tax-supported
| ||||||
7 | schools, and vocational or technical schools or institutes | ||||||
8 | organized and
operated exclusively to provide a course of | ||||||
9 | study of not less than 6 weeks
duration and designed to prepare | ||||||
10 | individuals to follow a trade or to pursue a
manual, | ||||||
11 | technical, mechanical, industrial, business, or commercial
| ||||||
12 | occupation.
| ||||||
13 | (21) Beginning January 1, 2000, personal property, | ||||||
14 | including
food,
purchased through fundraising
events for the | ||||||
15 | benefit of
a public or private elementary or
secondary school, | ||||||
16 | a group of those schools, or one or more school
districts if | ||||||
17 | the events are
sponsored by an entity recognized by the school | ||||||
18 | district that consists
primarily of volunteers and includes
| ||||||
19 | parents and teachers of the school children. This paragraph | ||||||
20 | does not apply
to fundraising
events (i) for the benefit of | ||||||
21 | private home instruction or (ii)
for which the fundraising | ||||||
22 | entity purchases the personal property sold at
the events from | ||||||
23 | another individual or entity that sold the property for the
| ||||||
24 | purpose of resale by the fundraising entity and that
profits | ||||||
25 | from the sale to the
fundraising entity. This paragraph is | ||||||
26 | exempt
from the provisions
of Section 3-75.
|
| |||||||
| |||||||
1 | (22) Beginning January 1, 2000
and through December 31, | ||||||
2 | 2001, new or used automatic vending
machines that prepare and | ||||||
3 | serve hot food and beverages, including coffee, soup,
and
| ||||||
4 | other items, and replacement parts for these machines.
| ||||||
5 | Beginning January 1,
2002 and through June 30, 2003, machines | ||||||
6 | and parts for machines used in
commercial, coin-operated
| ||||||
7 | amusement
and vending business if a use or occupation tax is | ||||||
8 | paid on the gross receipts
derived from
the use of the | ||||||
9 | commercial, coin-operated amusement and vending machines.
This
| ||||||
10 | paragraph
is exempt from the provisions of Section 3-75.
| ||||||
11 | (23) Beginning August 23, 2001 and through June 30, 2016, | ||||||
12 | food for human consumption that is to be consumed off the
| ||||||
13 | premises
where it is sold (other than alcoholic beverages, | ||||||
14 | soft drinks, and food that
has been prepared for immediate | ||||||
15 | consumption) and prescription and
nonprescription medicines, | ||||||
16 | drugs, medical appliances, and insulin, urine
testing | ||||||
17 | materials, syringes, and needles used by diabetics, for human | ||||||
18 | use, when
purchased for use by a person receiving medical | ||||||
19 | assistance under Article V of
the Illinois Public Aid Code who | ||||||
20 | resides in a licensed long-term care facility,
as defined in | ||||||
21 | the Nursing Home Care Act, or in a licensed facility as defined | ||||||
22 | in the ID/DD Community Care Act, the MC/DD Act, or the | ||||||
23 | Specialized Mental Health Rehabilitation Act of 2013.
| ||||||
24 | (24) Beginning on August 2, 2001 (the effective date of | ||||||
25 | Public Act 92-227), computers and communications equipment
| ||||||
26 | utilized for any hospital purpose and equipment used in the |
| |||||||
| |||||||
1 | diagnosis,
analysis, or treatment of hospital patients | ||||||
2 | purchased by a lessor who leases
the equipment, under a lease | ||||||
3 | of one year or longer executed or in effect at the
time the | ||||||
4 | lessor would otherwise be subject to the tax imposed by this | ||||||
5 | Act, to a
hospital that has been issued an active tax exemption | ||||||
6 | identification number by
the Department under Section 1g of | ||||||
7 | the Retailers' Occupation Tax Act. If the
equipment is leased | ||||||
8 | in a manner that does not qualify for this exemption or is
used | ||||||
9 | in any other nonexempt manner, the lessor shall be liable for | ||||||
10 | the
tax imposed under this Act or the Use Tax Act, as the case | ||||||
11 | may be, based on the
fair market value of the property at the | ||||||
12 | time the nonqualifying use occurs.
No lessor shall collect or | ||||||
13 | attempt to collect an amount (however
designated) that | ||||||
14 | purports to reimburse that lessor for the tax imposed by this
| ||||||
15 | Act or the Use Tax Act, as the case may be, if the tax has not | ||||||
16 | been
paid by the lessor. If a lessor improperly collects any | ||||||
17 | such amount from the
lessee, the lessee shall have a legal | ||||||
18 | right to claim a refund of that amount
from the lessor. If, | ||||||
19 | however, that amount is not refunded to the lessee for
any | ||||||
20 | reason, the lessor is liable to pay that amount to the | ||||||
21 | Department.
This paragraph is exempt from the provisions of | ||||||
22 | Section 3-75.
| ||||||
23 | (25) Beginning
on August 2, 2001 (the effective date of | ||||||
24 | Public Act 92-227),
personal property purchased by a lessor
| ||||||
25 | who leases the property, under a lease of one year or longer | ||||||
26 | executed or in
effect at the time the lessor would otherwise be |
| |||||||
| |||||||
1 | subject to the tax imposed by
this Act, to a governmental body | ||||||
2 | that has been issued an active tax exemption
identification | ||||||
3 | number by the Department under Section 1g of the Retailers'
| ||||||
4 | Occupation Tax Act. If the property is leased in a manner that | ||||||
5 | does not
qualify for this exemption or is used in any other | ||||||
6 | nonexempt manner, the
lessor shall be liable for the tax | ||||||
7 | imposed under this Act or the Use Tax Act,
as the case may be, | ||||||
8 | based on the fair market value of the property at the time
the | ||||||
9 | nonqualifying use occurs. No lessor shall collect or attempt | ||||||
10 | to collect
an amount (however designated) that purports to | ||||||
11 | reimburse that lessor for the
tax imposed by this Act or the | ||||||
12 | Use Tax Act, as the case may be, if the tax has
not been paid | ||||||
13 | by the lessor. If a lessor improperly collects any such amount
| ||||||
14 | from the lessee, the lessee shall have a legal right to claim a | ||||||
15 | refund of that
amount from the lessor. If, however, that | ||||||
16 | amount is not refunded to the lessee
for any reason, the lessor | ||||||
17 | is liable to pay that amount to the Department.
This paragraph | ||||||
18 | is exempt from the provisions of Section 3-75.
| ||||||
19 | (26) Beginning January 1, 2008, tangible personal property | ||||||
20 | used in the construction or maintenance of a community water | ||||||
21 | supply, as defined under Section 3.145 of the Environmental | ||||||
22 | Protection Act, that is operated by a not-for-profit | ||||||
23 | corporation that holds a valid water supply permit issued | ||||||
24 | under Title IV of the Environmental Protection Act. This | ||||||
25 | paragraph is exempt from the provisions of Section 3-75.
| ||||||
26 | (27) Beginning January 1, 2010 and continuing through |
| |||||||
| |||||||
1 | December 31, 2024, materials, parts, equipment, components, | ||||||
2 | and furnishings incorporated into or upon an aircraft as part | ||||||
3 | of the modification, refurbishment, completion, replacement, | ||||||
4 | repair, or maintenance of the aircraft. This exemption | ||||||
5 | includes consumable supplies used in the modification, | ||||||
6 | refurbishment, completion, replacement, repair, and | ||||||
7 | maintenance of aircraft, but excludes any materials, parts, | ||||||
8 | equipment, components, and consumable supplies used in the | ||||||
9 | modification, replacement, repair, and maintenance of aircraft | ||||||
10 | engines or power plants, whether such engines or power plants | ||||||
11 | are installed or uninstalled upon any such aircraft. | ||||||
12 | "Consumable supplies" include, but are not limited to, | ||||||
13 | adhesive, tape, sandpaper, general purpose lubricants, | ||||||
14 | cleaning solution, latex gloves, and protective films. This | ||||||
15 | exemption applies only to the use of qualifying tangible | ||||||
16 | personal property transferred incident to the modification, | ||||||
17 | refurbishment, completion, replacement, repair, or maintenance | ||||||
18 | of aircraft by persons who (i) hold an Air Agency Certificate | ||||||
19 | and are empowered to operate an approved repair station by the | ||||||
20 | Federal Aviation Administration, (ii) have a Class IV Rating, | ||||||
21 | and (iii) conduct operations in accordance with Part 145 of | ||||||
22 | the Federal Aviation Regulations. The exemption does not | ||||||
23 | include aircraft operated by a commercial air carrier | ||||||
24 | providing scheduled passenger air service pursuant to | ||||||
25 | authority issued under Part 121 or Part 129 of the Federal | ||||||
26 | Aviation Regulations. The changes made to this paragraph (27) |
| |||||||
| |||||||
1 | by Public Act 98-534 are declarative of existing law. It is the | ||||||
2 | intent of the General Assembly that the exemption under this | ||||||
3 | paragraph (27) applies continuously from January 1, 2010 | ||||||
4 | through December 31, 2024; however, no claim for credit or | ||||||
5 | refund is allowed for taxes paid as a result of the | ||||||
6 | disallowance of this exemption on or after January 1, 2015 and | ||||||
7 | prior to the effective date of this amendatory Act of the 101st | ||||||
8 | General Assembly. | ||||||
9 | (28) Tangible personal property purchased by a | ||||||
10 | public-facilities corporation, as described in Section | ||||||
11 | 11-65-10 of the Illinois Municipal Code, for purposes of | ||||||
12 | constructing or furnishing a municipal convention hall, but | ||||||
13 | only if the legal title to the municipal convention hall is | ||||||
14 | transferred to the municipality without any further | ||||||
15 | consideration by or on behalf of the municipality at the time | ||||||
16 | of the completion of the municipal convention hall or upon the | ||||||
17 | retirement or redemption of any bonds or other debt | ||||||
18 | instruments issued by the public-facilities corporation in | ||||||
19 | connection with the development of the municipal convention | ||||||
20 | hall. This exemption includes existing public-facilities | ||||||
21 | corporations as provided in Section 11-65-25 of the Illinois | ||||||
22 | Municipal Code. This paragraph is exempt from the provisions | ||||||
23 | of Section 3-75. | ||||||
24 | (29) Beginning January 1, 2017 and through December 31, | ||||||
25 | 2026, menstrual pads, tampons, and menstrual cups. | ||||||
26 | (30) Tangible personal property transferred to a purchaser |
| |||||||
| |||||||
1 | who is exempt from the tax imposed by this Act by operation of | ||||||
2 | federal law. This paragraph is exempt from the provisions of | ||||||
3 | Section 3-75. | ||||||
4 | (31) Qualified tangible personal property used in the | ||||||
5 | construction or operation of a data center that has been | ||||||
6 | granted a certificate of exemption by the Department of | ||||||
7 | Commerce and Economic Opportunity, whether that tangible | ||||||
8 | personal property is purchased by the owner, operator, or | ||||||
9 | tenant of the data center or by a contractor or subcontractor | ||||||
10 | of the owner, operator, or tenant. Data centers that would | ||||||
11 | have qualified for a certificate of exemption prior to January | ||||||
12 | 1, 2020 had this amendatory Act of the 101st General Assembly | ||||||
13 | been in effect, may apply for and obtain an exemption for | ||||||
14 | subsequent purchases of computer equipment or enabling | ||||||
15 | software purchased or leased to upgrade, supplement, or | ||||||
16 | replace computer equipment or enabling software purchased or | ||||||
17 | leased in the original investment that would have qualified. | ||||||
18 | The Department of Commerce and Economic Opportunity shall | ||||||
19 | grant a certificate of exemption under this item (31) to | ||||||
20 | qualified data centers as defined by Section 605-1025 of the | ||||||
21 | Department of Commerce and Economic Opportunity Law of the
| ||||||
22 | Civil Administrative Code of Illinois. | ||||||
23 | For the purposes of this item (31): | ||||||
24 | "Data center" means a building or a series of | ||||||
25 | buildings rehabilitated or constructed to house working | ||||||
26 | servers in one physical location or multiple sites within |
| |||||||
| |||||||
1 | the State of Illinois. | ||||||
2 | "Qualified tangible personal property" means: | ||||||
3 | electrical systems and equipment; climate control and | ||||||
4 | chilling equipment and systems; mechanical systems and | ||||||
5 | equipment; monitoring and secure systems; emergency | ||||||
6 | generators; hardware; computers; servers; data storage | ||||||
7 | devices; network connectivity equipment; racks; cabinets; | ||||||
8 | telecommunications cabling infrastructure; raised floor | ||||||
9 | systems; peripheral components or systems; software; | ||||||
10 | mechanical, electrical, or plumbing systems; battery | ||||||
11 | systems; cooling systems and towers; temperature control | ||||||
12 | systems; other cabling; and other data center | ||||||
13 | infrastructure equipment and systems necessary to operate | ||||||
14 | qualified tangible personal property, including fixtures; | ||||||
15 | and component parts of any of the foregoing, including | ||||||
16 | installation, maintenance, repair, refurbishment, and | ||||||
17 | replacement of qualified tangible personal property to | ||||||
18 | generate, transform, transmit, distribute, or manage | ||||||
19 | electricity necessary to operate qualified tangible | ||||||
20 | personal property; and all other tangible personal | ||||||
21 | property that is essential to the operations of a computer | ||||||
22 | data center. The term "qualified tangible personal | ||||||
23 | property" also includes building materials physically | ||||||
24 | incorporated in to the qualifying data center. To document | ||||||
25 | the exemption allowed under this Section, the retailer | ||||||
26 | must obtain from the purchaser a copy of the certificate |
| |||||||
| |||||||
1 | of eligibility issued by the Department of Commerce and | ||||||
2 | Economic Opportunity. | ||||||
3 | This item (31) is exempt from the provisions of Section | ||||||
4 | 3-75. | ||||||
5 | (32) Beginning on the earlier of: (i) January 1, 2025; or | ||||||
6 | (ii) January 1 of the calendar year immediately following the | ||||||
7 | calendar year in which the State reports to the United States | ||||||
8 | Department of the Treasury that all federal funds received | ||||||
9 | under the American Rescue Plan Act of 2021 have been fully | ||||||
10 | expended, and continuing through December 31 of the fifth | ||||||
11 | calendar year to occur after the earlier of: (i) January 1, | ||||||
12 | 2025; or (ii) January 1 of the calendar year immediately | ||||||
13 | following the calendar year in which the State reports to the | ||||||
14 | United States Department of the Treasury that all federal | ||||||
15 | funds received under the American Rescue Plan Act of 2021 have | ||||||
16 | been fully expended, equipment and material deployed after | ||||||
17 | January 1, 2023 in a county in the State with a population of | ||||||
18 | fewer than 40,000 people or a township in the State with a | ||||||
19 | population density of less than 50 households per square mile | ||||||
20 | in a county with a population of less than 300,000 people | ||||||
21 | during that year that is incorporated into or used in the | ||||||
22 | business of providing broadband services, including all | ||||||
23 | equipment and material, machinery, software, or other tangible | ||||||
24 | personal property that is used in whole or in part in | ||||||
25 | producing, broadcasting, distributing, sending, receiving, | ||||||
26 | storing, transmitting, retransmitting, amplifying, switching, |
| |||||||
| |||||||
1 | or routing broadband services, including the monitoring, | ||||||
2 | testing, maintaining, enabling, or facilitating of such | ||||||
3 | equipment, machinery, software, or other infrastructure. Such | ||||||
4 | property includes, but is not limited to, wires, cables | ||||||
5 | including fiber optic cables, antennas, poles, switches, | ||||||
6 | routers, amplifiers, rectifiers, repeaters, receivers, | ||||||
7 | multiplexers, duplexers, transmitters, power equipment, backup | ||||||
8 | power equipment, diagnostic equipment, storage devices, | ||||||
9 | modems, and other general central office equipment, such as | ||||||
10 | channel cards, frames, and cabinets. The exemption under this | ||||||
11 | item (32) may be taken for property placed in service on or | ||||||
12 | after January 1, 2023; however, the credit may not be taken | ||||||
13 | until a taxable year beginning on or after the earlier of: (i) | ||||||
14 | January 1, 2025; or (ii) January 1 of the calendar year | ||||||
15 | immediately following the calendar year in which the State | ||||||
16 | reports to the United States Department of the Treasury that | ||||||
17 | all federal funds received under the American Rescue Plan Act | ||||||
18 | of 2021 have been fully expended. | ||||||
19 | (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19; | ||||||
20 | 101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
| ||||||
21 | Section 20. The Service Occupation Tax Act is amended by | ||||||
22 | changing Sections 2 and 3-5 as follows:
| ||||||
23 | (35 ILCS 115/2) (from Ch. 120, par. 439.102)
| ||||||
24 | Sec. 2. In this Act: |
| |||||||
| |||||||
1 | "Broadband service" means a service provided by wireline | ||||||
2 | or wireless means capable of delivering high-speed internet | ||||||
3 | access at speeds of at least 25 megabits per second of download | ||||||
4 | speed and 3 megabits per second of upload speed. | ||||||
5 | "Transfer" means any transfer of the title to property or | ||||||
6 | of
the ownership of property whether or not the transferor | ||||||
7 | retains title as
security for the payment of amounts due him | ||||||
8 | from the transferee.
| ||||||
9 | "Cost Price" means the consideration paid by the | ||||||
10 | serviceman for a
purchase valued in money, whether paid in | ||||||
11 | money or otherwise, including
cash, credits and services, and | ||||||
12 | shall be determined without any deduction
on account of the | ||||||
13 | supplier's cost of the property sold or on account of any
other | ||||||
14 | expense incurred by the supplier. When a serviceman contracts | ||||||
15 | out
part or all of the services required in his sale of | ||||||
16 | service, it shall be
presumed that the cost price to the | ||||||
17 | serviceman of the property
transferred to him by his or her | ||||||
18 | subcontractor is equal to 50% of the
subcontractor's charges | ||||||
19 | to the serviceman in the absence of proof of the
consideration | ||||||
20 | paid by the subcontractor for the purchase of such
property.
| ||||||
21 | "Department" means the Department of Revenue.
| ||||||
22 | "Person" means any natural individual, firm, partnership, | ||||||
23 | association, joint
stock company, joint venture, public or | ||||||
24 | private corporation, limited liability
company, and any | ||||||
25 | receiver, executor, trustee, guardian or other representative
| ||||||
26 | appointed by order of any court.
|
| |||||||
| |||||||
1 | "Sale of Service" means any transaction except:
| ||||||
2 | (a) A retail sale of tangible personal property taxable | ||||||
3 | under the Retailers'
Occupation Tax Act or under the Use Tax | ||||||
4 | Act.
| ||||||
5 | (b) A sale of tangible personal property for the purpose | ||||||
6 | of resale made in
compliance with Section 2c of the Retailers' | ||||||
7 | Occupation Tax Act.
| ||||||
8 | (c) Except as hereinafter provided, a sale or transfer of | ||||||
9 | tangible personal
property as an incident to the rendering of | ||||||
10 | service for or by any governmental
body or for or by any | ||||||
11 | corporation, society, association, foundation or
institution | ||||||
12 | organized and operated exclusively for charitable, religious | ||||||
13 | or
educational purposes or any not-for-profit corporation, | ||||||
14 | society, association,
foundation, institution or organization | ||||||
15 | which has no compensated officers or
employees and which is | ||||||
16 | organized and operated primarily for the recreation of
persons | ||||||
17 | 55 years of age or older. A limited liability company may | ||||||
18 | qualify for
the exemption under this paragraph only if the | ||||||
19 | limited liability company is
organized and operated | ||||||
20 | exclusively for educational purposes.
| ||||||
21 | (d) (Blank).
| ||||||
22 | (d-1) A sale or transfer of tangible personal
property as | ||||||
23 | an incident to
the rendering of service for owners, lessors or | ||||||
24 | shippers of tangible personal
property which is utilized by | ||||||
25 | interstate carriers for hire for use as rolling
stock moving | ||||||
26 | in interstate commerce, and equipment operated
by a |
| |||||||
| |||||||
1 | telecommunications provider, licensed as a common carrier by | ||||||
2 | the
Federal Communications Commission, which is permanently | ||||||
3 | installed in or
affixed to aircraft moving in interstate | ||||||
4 | commerce.
| ||||||
5 | (d-1.1) On and after July 1, 2003 and through June 30, | ||||||
6 | 2004, a sale or transfer of a motor vehicle
of the
second | ||||||
7 | division with a gross vehicle weight in excess of 8,000 pounds | ||||||
8 | as an
incident to the rendering of service if that motor
| ||||||
9 | vehicle is subject
to the commercial distribution fee imposed | ||||||
10 | under Section 3-815.1 of the
Illinois Vehicle
Code. Beginning | ||||||
11 | on July 1, 2004 and through June 30, 2005, the use in this | ||||||
12 | State of motor vehicles of the second division: (i) with a | ||||||
13 | gross vehicle weight rating in excess of 8,000 pounds; (ii) | ||||||
14 | that are subject to the commercial distribution fee imposed | ||||||
15 | under Section 3-815.1 of the Illinois Vehicle Code; and (iii) | ||||||
16 | that are primarily used for commercial purposes. Through June | ||||||
17 | 30, 2005, this exemption applies to repair and replacement | ||||||
18 | parts added after the
initial
purchase of such a motor vehicle | ||||||
19 | if that motor vehicle is used in a manner that
would
qualify | ||||||
20 | for the rolling stock exemption otherwise provided for in this | ||||||
21 | Act. For purposes of this paragraph, "used for commercial | ||||||
22 | purposes" means the transportation of persons or property in | ||||||
23 | furtherance of any commercial or industrial enterprise whether | ||||||
24 | for-hire or not.
| ||||||
25 | (d-2) The repairing, reconditioning or remodeling, for a | ||||||
26 | common carrier by
rail, of tangible personal property which |
| |||||||
| |||||||
1 | belongs to such carrier for hire, and
as to which such carrier | ||||||
2 | receives the physical possession of the repaired,
| ||||||
3 | reconditioned or remodeled item of tangible personal property | ||||||
4 | in Illinois, and
which such carrier transports, or shares with | ||||||
5 | another common carrier in the
transportation of such property, | ||||||
6 | out of Illinois on a standard uniform bill of
lading showing | ||||||
7 | the person who repaired, reconditioned or remodeled the | ||||||
8 | property
as the shipper or consignor of such property to a | ||||||
9 | destination outside Illinois,
for use outside Illinois.
| ||||||
10 | (d-3) A sale or transfer of tangible personal property | ||||||
11 | which
is produced by the seller thereof on special order in | ||||||
12 | such a way as to have
made the applicable tax the Service | ||||||
13 | Occupation Tax or the Service Use Tax,
rather than the | ||||||
14 | Retailers' Occupation Tax or the Use Tax, for an interstate
| ||||||
15 | carrier by rail which receives the physical possession of such | ||||||
16 | property in
Illinois, and which transports such property, or | ||||||
17 | shares with another common
carrier in the transportation of | ||||||
18 | such property, out of Illinois on a standard
uniform bill of | ||||||
19 | lading showing the seller of the property as the shipper or
| ||||||
20 | consignor of such property to a destination outside Illinois, | ||||||
21 | for use outside
Illinois.
| ||||||
22 | (d-4) Until January 1, 1997, a sale, by a registered | ||||||
23 | serviceman paying tax
under this Act to the Department, of | ||||||
24 | special order printed materials delivered
outside Illinois and | ||||||
25 | which are not returned to this State, if delivery is made
by | ||||||
26 | the seller or agent of the seller, including an agent who |
| |||||||
| |||||||
1 | causes the product
to be delivered outside Illinois by a | ||||||
2 | common carrier or the U.S.
postal service.
| ||||||
3 | (e) A sale or transfer of machinery and equipment used | ||||||
4 | primarily in
the process of the manufacturing or assembling, | ||||||
5 | either in an existing, an
expanded or a new manufacturing | ||||||
6 | facility, of tangible personal property for
wholesale or | ||||||
7 | retail sale or lease, whether such sale or lease is made | ||||||
8 | directly
by the manufacturer or by some other person, whether | ||||||
9 | the materials used in the
process are owned by the | ||||||
10 | manufacturer or some other person, or whether such
sale or | ||||||
11 | lease is made apart from or as an incident to the seller's | ||||||
12 | engaging in
a service occupation and the applicable tax is a | ||||||
13 | Service Occupation Tax or
Service Use Tax, rather than | ||||||
14 | Retailers' Occupation Tax or Use Tax. The exemption provided | ||||||
15 | by this paragraph (e) includes production related tangible | ||||||
16 | personal property, as defined in Section 3-50 of the Use Tax | ||||||
17 | Act, purchased on or after July 1, 2019. The exemption | ||||||
18 | provided by this paragraph (e) does not include machinery and | ||||||
19 | equipment used in (i) the generation of electricity for | ||||||
20 | wholesale or retail sale; (ii) the generation or treatment of | ||||||
21 | natural or artificial gas for wholesale or retail sale that is | ||||||
22 | delivered to customers through pipes, pipelines, or mains; or | ||||||
23 | (iii) the treatment of water for wholesale or retail sale that | ||||||
24 | is delivered to customers through pipes, pipelines, or mains. | ||||||
25 | The provisions of Public Act 98-583 are declaratory of | ||||||
26 | existing law as to the meaning and scope of this exemption. The |
| |||||||
| |||||||
1 | exemption under this subsection (e) is exempt from the | ||||||
2 | provisions of Section 3-75.
| ||||||
3 | (f) Until July 1, 2003, the sale or transfer of | ||||||
4 | distillation
machinery
and equipment, sold as a
unit or kit | ||||||
5 | and assembled or installed by the retailer, which machinery
| ||||||
6 | and equipment is certified by the user to be used only for the | ||||||
7 | production
of ethyl alcohol that will be used for consumption | ||||||
8 | as motor fuel or as a
component of motor fuel for the personal | ||||||
9 | use of such user and not subject
to sale or resale.
| ||||||
10 | (g) At the election of any serviceman not required to be | ||||||
11 | otherwise
registered as a retailer under Section 2a of the | ||||||
12 | Retailers' Occupation Tax Act,
made for each fiscal year sales | ||||||
13 | of service in which the aggregate annual cost
price of | ||||||
14 | tangible personal property transferred as an incident to the | ||||||
15 | sales of
service is less than 35% (75% in the case of | ||||||
16 | servicemen transferring
prescription drugs or servicemen | ||||||
17 | engaged in graphic arts production) of the
aggregate annual | ||||||
18 | total gross receipts from all sales of service. The purchase
| ||||||
19 | of such tangible personal property by the serviceman shall be | ||||||
20 | subject to tax
under the Retailers' Occupation Tax Act and the | ||||||
21 | Use Tax Act.
However, if a
primary serviceman who has made the | ||||||
22 | election described in this paragraph
subcontracts service work | ||||||
23 | to a secondary serviceman who has also made the
election | ||||||
24 | described in this paragraph, the primary serviceman does not
| ||||||
25 | incur a Use Tax liability if the secondary serviceman (i) has | ||||||
26 | paid or will pay
Use
Tax on his or her cost price of any |
| |||||||
| |||||||
1 | tangible personal property transferred
to the primary | ||||||
2 | serviceman and (ii) certifies that fact in writing to the
| ||||||
3 | primary serviceman.
| ||||||
4 | Tangible personal property transferred incident to the | ||||||
5 | completion of a
maintenance agreement is exempt from the tax | ||||||
6 | imposed pursuant to this Act.
| ||||||
7 | Exemption (e) also includes machinery and equipment used | ||||||
8 | in the
general maintenance or repair of such exempt machinery | ||||||
9 | and equipment or for
in-house manufacture of exempt machinery | ||||||
10 | and equipment.
On and after July 1, 2017, exemption (e) also
| ||||||
11 | includes graphic arts machinery and equipment, as
defined in | ||||||
12 | paragraph (5) of Section 3-5. The machinery and equipment | ||||||
13 | exemption does not include machinery and equipment used in (i) | ||||||
14 | the generation of electricity for wholesale or retail sale; | ||||||
15 | (ii) the generation or treatment of natural or artificial gas | ||||||
16 | for wholesale or retail sale that is delivered to customers | ||||||
17 | through pipes, pipelines, or mains; or (iii) the treatment of | ||||||
18 | water for wholesale or retail sale that is delivered to | ||||||
19 | customers through pipes, pipelines, or mains. The provisions | ||||||
20 | of Public Act 98-583 are declaratory of existing law as to the | ||||||
21 | meaning and scope of this exemption. For the purposes of | ||||||
22 | exemption (e), each of these terms shall have the following
| ||||||
23 | meanings: (1) "manufacturing process" shall mean the | ||||||
24 | production of any
article of tangible personal property, | ||||||
25 | whether such article is a
finished product or an article for | ||||||
26 | use in the process of manufacturing
or assembling a different |
| |||||||
| |||||||
1 | article of tangible personal property, by
procedures commonly | ||||||
2 | regarded as manufacturing, processing, fabricating,
or | ||||||
3 | refining which changes some existing material or materials | ||||||
4 | into a
material with a different form, use or name. In relation | ||||||
5 | to a
recognized integrated business composed of a series of | ||||||
6 | operations which
collectively constitute manufacturing, or | ||||||
7 | individually constitute
manufacturing operations, the | ||||||
8 | manufacturing process shall be deemed to
commence with the | ||||||
9 | first operation or stage of production in the series,
and | ||||||
10 | shall not be deemed to end until the completion of the final | ||||||
11 | product
in the last operation or stage of production in the | ||||||
12 | series; and further for
purposes of exemption (e), | ||||||
13 | photoprocessing is deemed to be a manufacturing
process of | ||||||
14 | tangible personal property for wholesale or retail sale;
(2) | ||||||
15 | "assembling process" shall mean the production of any article | ||||||
16 | of
tangible personal property, whether such article is a | ||||||
17 | finished product
or an article for use in the process of | ||||||
18 | manufacturing or assembling a
different article of tangible | ||||||
19 | personal property, by the combination of
existing materials in | ||||||
20 | a manner commonly regarded as assembling which
results in a | ||||||
21 | material of a different form, use or name; (3) "machinery"
| ||||||
22 | shall mean major mechanical machines or major components of | ||||||
23 | such machines
contributing to a manufacturing or assembling | ||||||
24 | process; and (4) "equipment"
shall include any independent | ||||||
25 | device or tool separate from any machinery but
essential to an | ||||||
26 | integrated manufacturing or assembly process; including
|
| |||||||
| |||||||
1 | computers used primarily in a manufacturer's computer
assisted | ||||||
2 | design, computer assisted manufacturing (CAD/CAM) system; or | ||||||
3 | any
subunit or assembly comprising a component of any | ||||||
4 | machinery or auxiliary,
adjunct or attachment parts of | ||||||
5 | machinery, such as tools, dies, jigs, fixtures,
patterns and | ||||||
6 | molds; or any parts which require periodic replacement in the
| ||||||
7 | course of normal operation; but shall not include hand tools. | ||||||
8 | Equipment
includes chemicals or chemicals acting as catalysts | ||||||
9 | but only if the chemicals
or chemicals acting as catalysts | ||||||
10 | effect a direct and immediate change upon a
product being | ||||||
11 | manufactured or assembled for wholesale or retail sale or | ||||||
12 | lease.
The purchaser of such machinery and equipment
who has | ||||||
13 | an active resale registration number shall furnish such number | ||||||
14 | to
the seller at the time of purchase. The purchaser of such | ||||||
15 | machinery and
equipment and tools without an active resale | ||||||
16 | registration number shall furnish
to the seller a certificate | ||||||
17 | of exemption stating facts
establishing the exemption, which | ||||||
18 | certificate shall
be available to the Department for | ||||||
19 | inspection or audit.
| ||||||
20 | Except as provided in Section 2d of this Act, the rolling | ||||||
21 | stock exemption
applies to rolling
stock
used by an interstate
| ||||||
22 | carrier for hire, even just between points in Illinois, if | ||||||
23 | such rolling
stock transports, for hire, persons whose | ||||||
24 | journeys or property whose
shipments originate or terminate | ||||||
25 | outside Illinois.
| ||||||
26 | Any informal rulings, opinions or letters issued by the |
| |||||||
| |||||||
1 | Department in
response to an inquiry or request for any | ||||||
2 | opinion from any person
regarding the coverage and | ||||||
3 | applicability of exemption (e) to specific
devices shall be | ||||||
4 | published, maintained as a public record, and made
available | ||||||
5 | for public inspection and copying. If the informal ruling,
| ||||||
6 | opinion or letter contains trade secrets or other confidential
| ||||||
7 | information, where possible the Department shall delete such | ||||||
8 | information
prior to publication. Whenever such informal | ||||||
9 | rulings, opinions, or
letters contain any policy of general | ||||||
10 | applicability, the Department
shall formulate and adopt such | ||||||
11 | policy as a rule in accordance with the
provisions of the | ||||||
12 | Illinois Administrative Procedure Act.
| ||||||
13 | On and after July 1, 1987, no entity otherwise eligible | ||||||
14 | under exemption
(c) of this Section shall make tax-free | ||||||
15 | purchases unless it has an active
exemption identification | ||||||
16 | number issued by the Department.
| ||||||
17 | "Serviceman" means any person who is engaged in the | ||||||
18 | occupation of
making sales of service.
| ||||||
19 | "Sale at Retail" means "sale at retail" as defined in the | ||||||
20 | Retailers'
Occupation Tax Act.
| ||||||
21 | "Supplier" means any person who makes sales of tangible | ||||||
22 | personal
property to servicemen for the purpose of resale as | ||||||
23 | an incident to a
sale of service.
| ||||||
24 | (Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17; | ||||||
25 | 100-863, eff. 8-14-18; 101-9, eff. 6-5-19; 101-604, eff. | ||||||
26 | 12-13-19.)
|
| |||||||
| |||||||
1 | (35 ILCS 115/3-5)
| ||||||
2 | Sec. 3-5. Exemptions. The following tangible personal | ||||||
3 | property is
exempt from the tax imposed by this Act:
| ||||||
4 | (1) Personal property sold by a corporation, society, | ||||||
5 | association,
foundation, institution, or organization, other | ||||||
6 | than a limited liability
company, that is organized and | ||||||
7 | operated as a not-for-profit service enterprise
for the | ||||||
8 | benefit of persons 65 years of age or older if the personal | ||||||
9 | property
was not purchased by the enterprise for the purpose | ||||||
10 | of resale by the
enterprise.
| ||||||
11 | (2) Personal property purchased by a not-for-profit | ||||||
12 | Illinois county fair
association for use in conducting, | ||||||
13 | operating, or promoting the county fair.
| ||||||
14 | (3) Personal property purchased by any not-for-profit
arts | ||||||
15 | or cultural organization that establishes, by proof required | ||||||
16 | by the
Department by
rule, that it has received an exemption | ||||||
17 | under Section 501(c)(3) of the
Internal Revenue Code and that | ||||||
18 | is organized and operated primarily for the
presentation
or | ||||||
19 | support of arts or cultural programming, activities, or | ||||||
20 | services. These
organizations include, but are not limited to, | ||||||
21 | music and dramatic arts
organizations such as symphony | ||||||
22 | orchestras and theatrical groups, arts and
cultural service | ||||||
23 | organizations, local arts councils, visual arts organizations,
| ||||||
24 | and media arts organizations.
On and after July 1, 2001 (the | ||||||
25 | effective date of Public Act 92-35), however, an entity |
| |||||||
| |||||||
1 | otherwise eligible for this exemption shall not
make tax-free | ||||||
2 | purchases unless it has an active identification number issued | ||||||
3 | by
the Department.
| ||||||
4 | (4) Legal tender, currency, medallions, or gold or silver | ||||||
5 | coinage
issued by the State of Illinois, the government of the | ||||||
6 | United States of
America, or the government of any foreign | ||||||
7 | country, and bullion.
| ||||||
8 | (5) Until July 1, 2003 and beginning again on September 1, | ||||||
9 | 2004 through August 30, 2014, graphic arts machinery and | ||||||
10 | equipment, including
repair and
replacement parts, both new | ||||||
11 | and used, and including that manufactured on
special order or | ||||||
12 | purchased for lease, certified by the purchaser to be used
| ||||||
13 | primarily for graphic arts production.
Equipment includes | ||||||
14 | chemicals or chemicals acting as catalysts but only if
the
| ||||||
15 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
16 | immediate change
upon a graphic arts product. Beginning on | ||||||
17 | July 1, 2017, graphic arts machinery and equipment is included | ||||||
18 | in the manufacturing and assembling machinery and equipment | ||||||
19 | exemption under Section 2 of this Act.
| ||||||
20 | (6) Personal property sold by a teacher-sponsored student | ||||||
21 | organization
affiliated with an elementary or secondary school | ||||||
22 | located in Illinois.
| ||||||
23 | (7) Farm machinery and equipment, both new and used, | ||||||
24 | including that
manufactured on special order, certified by the | ||||||
25 | purchaser to be used
primarily for production agriculture or | ||||||
26 | State or federal agricultural
programs, including individual |
| |||||||
| |||||||
1 | replacement parts for the machinery and
equipment, including | ||||||
2 | machinery and equipment purchased for lease,
and including | ||||||
3 | implements of husbandry defined in Section 1-130 of
the | ||||||
4 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
5 | chemical and
fertilizer spreaders, and nurse wagons required | ||||||
6 | to be registered
under Section 3-809 of the Illinois Vehicle | ||||||
7 | Code,
but
excluding other motor vehicles required to be | ||||||
8 | registered under the Illinois
Vehicle
Code.
Horticultural | ||||||
9 | polyhouses or hoop houses used for propagating, growing, or
| ||||||
10 | overwintering plants shall be considered farm machinery and | ||||||
11 | equipment under
this item (7).
Agricultural chemical tender | ||||||
12 | tanks and dry boxes shall include units sold
separately from a | ||||||
13 | motor vehicle required to be licensed and units sold mounted
| ||||||
14 | on a motor vehicle required to be licensed if the selling price | ||||||
15 | of the tender
is separately stated.
| ||||||
16 | Farm machinery and equipment shall include precision | ||||||
17 | farming equipment
that is
installed or purchased to be | ||||||
18 | installed on farm machinery and equipment
including, but not | ||||||
19 | limited to, tractors, harvesters, sprayers, planters,
seeders, | ||||||
20 | or spreaders.
Precision farming equipment includes, but is not | ||||||
21 | limited to,
soil testing sensors, computers, monitors, | ||||||
22 | software, global positioning
and mapping systems, and other | ||||||
23 | such equipment.
| ||||||
24 | Farm machinery and equipment also includes computers, | ||||||
25 | sensors, software, and
related equipment used primarily in the
| ||||||
26 | computer-assisted operation of production agriculture |
| |||||||
| |||||||
1 | facilities, equipment,
and activities such as, but
not limited | ||||||
2 | to,
the collection, monitoring, and correlation of
animal and | ||||||
3 | crop data for the purpose of
formulating animal diets and | ||||||
4 | agricultural chemicals. This item (7) is exempt
from the | ||||||
5 | provisions of
Section 3-55.
| ||||||
6 | (8) Until June 30, 2013, fuel and petroleum products sold | ||||||
7 | to or used by an air common
carrier, certified by the carrier | ||||||
8 | to be used for consumption, shipment,
or storage in the | ||||||
9 | conduct of its business as an air common carrier, for
a flight | ||||||
10 | destined for or returning from a location or locations
outside | ||||||
11 | the United States without regard to previous or subsequent | ||||||
12 | domestic
stopovers.
| ||||||
13 | Beginning July 1, 2013, fuel and petroleum products sold | ||||||
14 | to or used by an air carrier, certified by the carrier to be | ||||||
15 | used for consumption, shipment, or storage in the conduct of | ||||||
16 | its business as an air common carrier, for a flight that (i) is | ||||||
17 | engaged in foreign trade or is engaged in trade between the | ||||||
18 | United States and any of its possessions and (ii) transports | ||||||
19 | at least one individual or package for hire from the city of | ||||||
20 | origination to the city of final destination on the same | ||||||
21 | aircraft, without regard to a change in the flight number of | ||||||
22 | that aircraft. | ||||||
23 | (9) Proceeds of mandatory service charges separately
| ||||||
24 | stated on customers' bills for the purchase and consumption of | ||||||
25 | food and
beverages, to the extent that the proceeds of the | ||||||
26 | service charge are in fact
turned over as tips or as a |
| |||||||
| |||||||
1 | substitute for tips to the employees who
participate directly | ||||||
2 | in preparing, serving, hosting or cleaning up the
food or | ||||||
3 | beverage function with respect to which the service charge is | ||||||
4 | imposed.
| ||||||
5 | (10) Until July 1, 2003, oil field exploration, drilling, | ||||||
6 | and production
equipment,
including (i) rigs and parts of | ||||||
7 | rigs, rotary rigs, cable tool
rigs, and workover rigs, (ii) | ||||||
8 | pipe and tubular goods, including casing and
drill strings, | ||||||
9 | (iii) pumps and pump-jack units, (iv) storage tanks and flow
| ||||||
10 | lines, (v) any individual replacement part for oil field | ||||||
11 | exploration,
drilling, and production equipment, and (vi) | ||||||
12 | machinery and equipment purchased
for lease; but
excluding | ||||||
13 | motor vehicles required to be registered under the Illinois
| ||||||
14 | Vehicle Code.
| ||||||
15 | (11) Photoprocessing machinery and equipment, including | ||||||
16 | repair and
replacement parts, both new and used, including | ||||||
17 | that manufactured on
special order, certified by the purchaser | ||||||
18 | to be used primarily for
photoprocessing, and including | ||||||
19 | photoprocessing machinery and equipment
purchased for lease.
| ||||||
20 | (12) Until July 1, 2023, coal and aggregate exploration, | ||||||
21 | mining, off-highway hauling,
processing,
maintenance, and | ||||||
22 | reclamation equipment, including
replacement parts and | ||||||
23 | equipment, and including
equipment
purchased for lease, but | ||||||
24 | excluding motor vehicles required to be registered
under the | ||||||
25 | Illinois Vehicle Code. The changes made to this Section by | ||||||
26 | Public Act 97-767 apply on and after July 1, 2003, but no claim |
| |||||||
| |||||||
1 | for credit or refund is allowed on or after August 16, 2013 | ||||||
2 | (the effective date of Public Act 98-456)
for such taxes paid | ||||||
3 | during the period beginning July 1, 2003 and ending on August | ||||||
4 | 16, 2013 (the effective date of Public Act 98-456).
| ||||||
5 | (13) Beginning January 1, 1992 and through June 30, 2016, | ||||||
6 | food for human consumption that is to be consumed off the | ||||||
7 | premises
where it is sold (other than alcoholic beverages, | ||||||
8 | soft drinks and food that
has been prepared for immediate | ||||||
9 | consumption) and prescription and
non-prescription medicines, | ||||||
10 | drugs, medical appliances, and insulin, urine
testing | ||||||
11 | materials, syringes, and needles used by diabetics, for human | ||||||
12 | use,
when purchased for use by a person receiving medical | ||||||
13 | assistance under
Article V of the Illinois Public Aid Code who | ||||||
14 | resides in a licensed
long-term care facility, as defined in | ||||||
15 | the Nursing Home Care Act, or in a licensed facility as defined | ||||||
16 | in the ID/DD Community Care Act, the MC/DD Act, or the | ||||||
17 | Specialized Mental Health Rehabilitation Act of 2013.
| ||||||
18 | (14) Semen used for artificial insemination of livestock | ||||||
19 | for direct
agricultural production.
| ||||||
20 | (15) Horses, or interests in horses, registered with and | ||||||
21 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
22 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
23 | Horse Association, United States
Trotting Association, or | ||||||
24 | Jockey Club, as appropriate, used for
purposes of breeding or | ||||||
25 | racing for prizes. This item (15) is exempt from the | ||||||
26 | provisions of Section 3-55, and the exemption provided for |
| |||||||
| |||||||
1 | under this item (15) applies for all periods beginning May 30, | ||||||
2 | 1995, but no claim for credit or refund is allowed on or after | ||||||
3 | January 1, 2008 (the effective date of Public Act 95-88)
for | ||||||
4 | such taxes paid during the period beginning May 30, 2000 and | ||||||
5 | ending on January 1, 2008 (the effective date of Public Act | ||||||
6 | 95-88).
| ||||||
7 | (16) Computers and communications equipment utilized for | ||||||
8 | any
hospital
purpose
and equipment used in the diagnosis,
| ||||||
9 | analysis, or treatment of hospital patients sold to a lessor | ||||||
10 | who leases the
equipment, under a lease of one year or longer | ||||||
11 | executed or in effect at the
time of the purchase, to a
| ||||||
12 | hospital
that has been issued an active tax exemption | ||||||
13 | identification number by the
Department under Section 1g of | ||||||
14 | the Retailers' Occupation Tax Act.
| ||||||
15 | (17) Personal property sold to a lessor who leases the
| ||||||
16 | property, under a
lease of one year or longer executed or in | ||||||
17 | effect at the time of the purchase,
to a governmental body
that | ||||||
18 | has been issued an active tax exemption identification number | ||||||
19 | by the
Department under Section 1g of the Retailers' | ||||||
20 | Occupation Tax Act.
| ||||||
21 | (18) Beginning with taxable years ending on or after | ||||||
22 | December
31, 1995
and
ending with taxable years ending on or | ||||||
23 | before December 31, 2004,
personal property that is
donated | ||||||
24 | for disaster relief to be used in a State or federally declared
| ||||||
25 | disaster area in Illinois or bordering Illinois by a | ||||||
26 | manufacturer or retailer
that is registered in this State to a |
| |||||||
| |||||||
1 | corporation, society, association,
foundation, or institution | ||||||
2 | that has been issued a sales tax exemption
identification | ||||||
3 | number by the Department that assists victims of the disaster
| ||||||
4 | who reside within the declared disaster area.
| ||||||
5 | (19) Beginning with taxable years ending on or after | ||||||
6 | December
31, 1995 and
ending with taxable years ending on or | ||||||
7 | before December 31, 2004, personal
property that is used in | ||||||
8 | the performance of infrastructure repairs in this
State, | ||||||
9 | including but not limited to municipal roads and streets, | ||||||
10 | access roads,
bridges, sidewalks, waste disposal systems, | ||||||
11 | water and sewer line extensions,
water distribution and | ||||||
12 | purification facilities, storm water drainage and
retention | ||||||
13 | facilities, and sewage treatment facilities, resulting from a | ||||||
14 | State
or federally declared disaster in Illinois or bordering | ||||||
15 | Illinois when such
repairs are initiated on facilities located | ||||||
16 | in the declared disaster area
within 6 months after the | ||||||
17 | disaster.
| ||||||
18 | (20) Beginning July 1, 1999, game or game birds sold at a | ||||||
19 | "game breeding
and
hunting preserve area" as that term is used
| ||||||
20 | in the
Wildlife Code. This paragraph is exempt from the | ||||||
21 | provisions
of
Section 3-55.
| ||||||
22 | (21) A motor vehicle, as that term is defined in Section | ||||||
23 | 1-146
of the
Illinois Vehicle Code, that is donated to a | ||||||
24 | corporation, limited liability
company, society, association, | ||||||
25 | foundation, or institution that is determined by
the | ||||||
26 | Department to be organized and operated exclusively for |
| |||||||
| |||||||
1 | educational
purposes. For purposes of this exemption, "a | ||||||
2 | corporation, limited liability
company, society, association, | ||||||
3 | foundation, or institution organized and
operated
exclusively | ||||||
4 | for educational purposes" means all tax-supported public | ||||||
5 | schools,
private schools that offer systematic instruction in | ||||||
6 | useful branches of
learning by methods common to public | ||||||
7 | schools and that compare favorably in
their scope and | ||||||
8 | intensity with the course of study presented in tax-supported
| ||||||
9 | schools, and vocational or technical schools or institutes | ||||||
10 | organized and
operated exclusively to provide a course of | ||||||
11 | study of not less than 6 weeks
duration and designed to prepare | ||||||
12 | individuals to follow a trade or to pursue a
manual, | ||||||
13 | technical, mechanical, industrial, business, or commercial
| ||||||
14 | occupation.
| ||||||
15 | (22) Beginning January 1, 2000, personal property, | ||||||
16 | including
food,
purchased through fundraising
events for the | ||||||
17 | benefit of
a public or private elementary or
secondary school, | ||||||
18 | a group of those schools, or one or more school
districts if | ||||||
19 | the events are
sponsored by an entity recognized by the school | ||||||
20 | district that consists
primarily of volunteers and includes
| ||||||
21 | parents and teachers of the school children. This paragraph | ||||||
22 | does not apply
to fundraising
events (i) for the benefit of | ||||||
23 | private home instruction or (ii)
for which the fundraising | ||||||
24 | entity purchases the personal property sold at
the events from | ||||||
25 | another individual or entity that sold the property for the
| ||||||
26 | purpose of resale by the fundraising entity and that
profits |
| |||||||
| |||||||
1 | from the sale to the
fundraising entity. This paragraph is | ||||||
2 | exempt
from the provisions
of Section 3-55.
| ||||||
3 | (23) Beginning January 1, 2000
and through December 31, | ||||||
4 | 2001, new or used automatic vending
machines that prepare and | ||||||
5 | serve hot food and beverages, including coffee, soup,
and
| ||||||
6 | other items, and replacement parts for these machines.
| ||||||
7 | Beginning January 1,
2002 and through June 30, 2003, machines | ||||||
8 | and parts for
machines used in commercial, coin-operated | ||||||
9 | amusement
and vending business if a use or occupation tax is | ||||||
10 | paid on the gross receipts
derived from
the use of the | ||||||
11 | commercial, coin-operated amusement and vending machines.
This | ||||||
12 | paragraph is exempt from the provisions of Section 3-55.
| ||||||
13 | (24) Beginning
on August 2, 2001 (the effective date of | ||||||
14 | Public Act 92-227),
computers and communications equipment
| ||||||
15 | utilized for any hospital purpose and equipment used in the | ||||||
16 | diagnosis,
analysis, or treatment of hospital patients sold to | ||||||
17 | a lessor who leases the
equipment, under a lease of one year or | ||||||
18 | longer executed or in effect at the
time of the purchase, to a | ||||||
19 | hospital that has been issued an active tax
exemption | ||||||
20 | identification number by the Department under Section 1g of | ||||||
21 | the
Retailers' Occupation Tax Act. This paragraph is exempt | ||||||
22 | from the provisions of
Section 3-55.
| ||||||
23 | (25) Beginning
on August 2, 2001 (the effective date of | ||||||
24 | Public Act 92-227),
personal property sold to a lessor who
| ||||||
25 | leases the property, under a lease of one year or longer | ||||||
26 | executed or in effect
at the time of the purchase, to a |
| |||||||
| |||||||
1 | governmental body that has been issued an
active tax exemption | ||||||
2 | identification number by the Department under Section 1g
of | ||||||
3 | the Retailers' Occupation Tax Act. This paragraph is exempt | ||||||
4 | from the
provisions of Section 3-55.
| ||||||
5 | (26) Beginning on January 1, 2002 and through June 30, | ||||||
6 | 2016, tangible personal property
purchased
from an Illinois | ||||||
7 | retailer by a taxpayer engaged in centralized purchasing
| ||||||
8 | activities in Illinois who will, upon receipt of the property | ||||||
9 | in Illinois,
temporarily store the property in Illinois (i) | ||||||
10 | for the purpose of subsequently
transporting it outside this | ||||||
11 | State for use or consumption thereafter solely
outside this | ||||||
12 | State or (ii) for the purpose of being processed, fabricated, | ||||||
13 | or
manufactured into, attached to, or incorporated into other | ||||||
14 | tangible personal
property to be transported outside this | ||||||
15 | State and thereafter used or consumed
solely outside this | ||||||
16 | State. The Director of Revenue shall, pursuant to rules
| ||||||
17 | adopted in accordance with the Illinois Administrative | ||||||
18 | Procedure Act, issue a
permit to any taxpayer in good standing | ||||||
19 | with the Department who is eligible for
the exemption under | ||||||
20 | this paragraph (26). The permit issued under
this paragraph | ||||||
21 | (26) shall authorize the holder, to the extent and
in the | ||||||
22 | manner specified in the rules adopted under this Act, to | ||||||
23 | purchase
tangible personal property from a retailer exempt | ||||||
24 | from the taxes imposed by
this Act. Taxpayers shall maintain | ||||||
25 | all necessary books and records to
substantiate the use and | ||||||
26 | consumption of all such tangible personal property
outside of |
| |||||||
| |||||||
1 | the State of Illinois.
| ||||||
2 | (27) Beginning January 1, 2008, tangible personal property | ||||||
3 | used in the construction or maintenance of a community water | ||||||
4 | supply, as defined under Section 3.145 of the Environmental | ||||||
5 | Protection Act, that is operated by a not-for-profit | ||||||
6 | corporation that holds a valid water supply permit issued | ||||||
7 | under Title IV of the Environmental Protection Act. This | ||||||
8 | paragraph is exempt from the provisions of Section 3-55.
| ||||||
9 | (28) Tangible personal property sold to a | ||||||
10 | public-facilities corporation, as described in Section | ||||||
11 | 11-65-10 of the Illinois Municipal Code, for purposes of | ||||||
12 | constructing or furnishing a municipal convention hall, but | ||||||
13 | only if the legal title to the municipal convention hall is | ||||||
14 | transferred to the municipality without any further | ||||||
15 | consideration by or on behalf of the municipality at the time | ||||||
16 | of the completion of the municipal convention hall or upon the | ||||||
17 | retirement or redemption of any bonds or other debt | ||||||
18 | instruments issued by the public-facilities corporation in | ||||||
19 | connection with the development of the municipal convention | ||||||
20 | hall. This exemption includes existing public-facilities | ||||||
21 | corporations as provided in Section 11-65-25 of the Illinois | ||||||
22 | Municipal Code. This paragraph is exempt from the provisions | ||||||
23 | of Section 3-55. | ||||||
24 | (29) Beginning January 1, 2010 and continuing through | ||||||
25 | December 31, 2024, materials, parts, equipment, components, | ||||||
26 | and furnishings incorporated into or upon an aircraft as part |
| |||||||
| |||||||
1 | of the modification, refurbishment, completion, replacement, | ||||||
2 | repair, or maintenance of the aircraft. This exemption | ||||||
3 | includes consumable supplies used in the modification, | ||||||
4 | refurbishment, completion, replacement, repair, and | ||||||
5 | maintenance of aircraft, but excludes any materials, parts, | ||||||
6 | equipment, components, and consumable supplies used in the | ||||||
7 | modification, replacement, repair, and maintenance of aircraft | ||||||
8 | engines or power plants, whether such engines or power plants | ||||||
9 | are installed or uninstalled upon any such aircraft. | ||||||
10 | "Consumable supplies" include, but are not limited to, | ||||||
11 | adhesive, tape, sandpaper, general purpose lubricants, | ||||||
12 | cleaning solution, latex gloves, and protective films. This | ||||||
13 | exemption applies only to the transfer of qualifying tangible | ||||||
14 | personal property incident to the modification, refurbishment, | ||||||
15 | completion, replacement, repair, or maintenance of an aircraft | ||||||
16 | by persons who (i) hold an Air Agency Certificate and are | ||||||
17 | empowered to operate an approved repair station by the Federal | ||||||
18 | Aviation Administration, (ii) have a Class IV Rating, and | ||||||
19 | (iii) conduct operations in accordance with Part 145 of the | ||||||
20 | Federal Aviation Regulations. The exemption does not include | ||||||
21 | aircraft operated by a commercial air carrier providing | ||||||
22 | scheduled passenger air service pursuant to authority issued | ||||||
23 | under Part 121 or Part 129 of the Federal Aviation | ||||||
24 | Regulations. The changes made to this paragraph (29) by Public | ||||||
25 | Act 98-534 are declarative of existing law. It is the intent of | ||||||
26 | the General Assembly that the exemption under this paragraph |
| |||||||
| |||||||
1 | (29) applies continuously from January 1, 2010 through | ||||||
2 | December 31, 2024; however, no claim for credit or refund is | ||||||
3 | allowed for taxes paid as a result of the disallowance of this | ||||||
4 | exemption on or after January 1, 2015 and prior to the | ||||||
5 | effective date of this amendatory Act of the 101st General | ||||||
6 | Assembly. | ||||||
7 | (30) Beginning January 1, 2017 and through December 31, | ||||||
8 | 2026, menstrual pads, tampons, and menstrual cups. | ||||||
9 | (31) Tangible personal property transferred to a purchaser | ||||||
10 | who is exempt from tax by operation of federal law. This | ||||||
11 | paragraph is exempt from the provisions of Section 3-55. | ||||||
12 | (32) Qualified tangible personal property used in the | ||||||
13 | construction or operation of a data center that has been | ||||||
14 | granted a certificate of exemption by the Department of | ||||||
15 | Commerce and Economic Opportunity, whether that tangible | ||||||
16 | personal property is purchased by the owner, operator, or | ||||||
17 | tenant of the data center or by a contractor or subcontractor | ||||||
18 | of the owner, operator, or tenant. Data centers that would | ||||||
19 | have qualified for a certificate of exemption prior to January | ||||||
20 | 1, 2020 had this amendatory Act of the 101st General Assembly | ||||||
21 | been in effect, may apply for and obtain an exemption for | ||||||
22 | subsequent purchases of computer equipment or enabling | ||||||
23 | software purchased or leased to upgrade, supplement, or | ||||||
24 | replace computer equipment or enabling software purchased or | ||||||
25 | leased in the original investment that would have qualified. | ||||||
26 | The Department of Commerce and Economic Opportunity shall |
| |||||||
| |||||||
1 | grant a certificate of exemption under this item (32) to | ||||||
2 | qualified data centers as defined by Section 605-1025 of the | ||||||
3 | Department of Commerce and Economic Opportunity Law of the
| ||||||
4 | Civil Administrative Code of Illinois. | ||||||
5 | For the purposes of this item (32): | ||||||
6 | "Data center" means a building or a series of | ||||||
7 | buildings rehabilitated or constructed to house working | ||||||
8 | servers in one physical location or multiple sites within | ||||||
9 | the State of Illinois. | ||||||
10 | "Qualified tangible personal property" means: | ||||||
11 | electrical systems and equipment; climate control and | ||||||
12 | chilling equipment and systems; mechanical systems and | ||||||
13 | equipment; monitoring and secure systems; emergency | ||||||
14 | generators; hardware; computers; servers; data storage | ||||||
15 | devices; network connectivity equipment; racks; cabinets; | ||||||
16 | telecommunications cabling infrastructure; raised floor | ||||||
17 | systems; peripheral components or systems; software; | ||||||
18 | mechanical, electrical, or plumbing systems; battery | ||||||
19 | systems; cooling systems and towers; temperature control | ||||||
20 | systems; other cabling; and other data center | ||||||
21 | infrastructure equipment and systems necessary to operate | ||||||
22 | qualified tangible personal property, including fixtures; | ||||||
23 | and component parts of any of the foregoing, including | ||||||
24 | installation, maintenance, repair, refurbishment, and | ||||||
25 | replacement of qualified tangible personal property to | ||||||
26 | generate, transform, transmit, distribute, or manage |
| |||||||
| |||||||
1 | electricity necessary to operate qualified tangible | ||||||
2 | personal property; and all other tangible personal | ||||||
3 | property that is essential to the operations of a computer | ||||||
4 | data center. The term "qualified tangible personal | ||||||
5 | property" also includes building materials physically | ||||||
6 | incorporated in to the qualifying data center. To document | ||||||
7 | the exemption allowed under this Section, the retailer | ||||||
8 | must obtain from the purchaser a copy of the certificate | ||||||
9 | of eligibility issued by the Department of Commerce and | ||||||
10 | Economic Opportunity. | ||||||
11 | This item (32) is exempt from the provisions of Section | ||||||
12 | 3-55. | ||||||
13 | (33) Beginning on the earlier of: (i) January 1, 2025; or | ||||||
14 | (ii) January 1 of the calendar year immediately following the | ||||||
15 | calendar year in which the State reports to the United States | ||||||
16 | Department of the Treasury that all federal funds received | ||||||
17 | under the American Rescue Plan Act of 2021 have been fully | ||||||
18 | expended, and continuing through December 31 of the fifth | ||||||
19 | calendar year to occur after the earlier of: (i) January 1, | ||||||
20 | 2025; or (ii) January 1 of the calendar year immediately | ||||||
21 | following the calendar year in which the State reports to the | ||||||
22 | United States Department of the Treasury that all federal | ||||||
23 | funds received under the American Rescue Plan Act of 2021 have | ||||||
24 | been fully expended, equipment and material deployed after | ||||||
25 | January 1, 2023 in a county in the State with a population of | ||||||
26 | fewer than 40,000 people or a township in the State with a |
| |||||||
| |||||||
1 | population density of less than 50 households per square mile | ||||||
2 | in a county with a population of less than 300,000 people | ||||||
3 | during that year that is incorporated into or used in the | ||||||
4 | business of providing broadband services, including all | ||||||
5 | equipment and material, machinery, software, or other tangible | ||||||
6 | personal property that is used in whole or in part in | ||||||
7 | producing, broadcasting, distributing, sending, receiving, | ||||||
8 | storing, transmitting, retransmitting, amplifying, switching, | ||||||
9 | or routing broadband services, including the monitoring, | ||||||
10 | testing, maintaining, enabling, or facilitating of such | ||||||
11 | equipment, machinery, software, or other infrastructure. Such | ||||||
12 | property includes, but is not limited to, wires, cables | ||||||
13 | including fiber optic cables, antennas, poles, switches, | ||||||
14 | routers, amplifiers, rectifiers, repeaters, receivers, | ||||||
15 | multiplexers, duplexers, transmitters, power equipment, backup | ||||||
16 | power equipment, diagnostic equipment, storage devices, | ||||||
17 | modems, and other general central office equipment, such as | ||||||
18 | channel cards, frames, and cabinets. The exemption under this | ||||||
19 | item (33) may be taken for property placed in service on or | ||||||
20 | after January 1, 2023; however, the credit may not be taken | ||||||
21 | until a taxable year beginning on or after the earlier of: (i) | ||||||
22 | January 1, 2025; or (ii) January 1 of the calendar year | ||||||
23 | immediately following the calendar year in which the State | ||||||
24 | reports to the United States Department of the Treasury that | ||||||
25 | all federal funds received under the American Rescue Plan Act | ||||||
26 | of 2021 have been fully expended. |
| |||||||
| |||||||
1 | (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19; | ||||||
2 | 101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
| ||||||
3 | Section 25. The Retailers' Occupation Tax Act is amended | ||||||
4 | by changing Sections 1 and 2-5 as follows:
| ||||||
5 | (35 ILCS 120/1) (from Ch. 120, par. 440)
| ||||||
6 | Sec. 1. Definitions. As used in this Act: | ||||||
7 | "Broadband service" means a service provided by wireline | ||||||
8 | or wireless means capable of delivering high-speed internet | ||||||
9 | access at speeds of at least 25 megabits per second of download | ||||||
10 | speed and 3 megabits per second of upload speed. | ||||||
11 | "Sale at retail" means any transfer of the
ownership of or | ||||||
12 | title to
tangible personal property to a purchaser, for the | ||||||
13 | purpose of use or
consumption, and not for the purpose of | ||||||
14 | resale in any form as tangible
personal property to the extent | ||||||
15 | not first subjected to a use for which it
was purchased, for a | ||||||
16 | valuable consideration: Provided that the property
purchased | ||||||
17 | is deemed to be purchased for the purpose of resale, despite
| ||||||
18 | first being used, to the extent to which it is resold as an | ||||||
19 | ingredient of
an intentionally produced product or byproduct | ||||||
20 | of manufacturing. For this
purpose, slag produced as an | ||||||
21 | incident to manufacturing pig iron or steel
and sold is | ||||||
22 | considered to be an intentionally produced byproduct of
| ||||||
23 | manufacturing. Transactions whereby the possession of the | ||||||
24 | property is
transferred but the seller retains the title as |
| |||||||
| |||||||
1 | security for payment of the
selling price shall be deemed to be | ||||||
2 | sales.
| ||||||
3 | "Sale at retail" shall be construed to include any | ||||||
4 | transfer of the
ownership of or title to tangible personal | ||||||
5 | property to a purchaser, for use
or consumption by any other | ||||||
6 | person to whom such purchaser may transfer the
tangible | ||||||
7 | personal property without a valuable consideration, and to | ||||||
8 | include
any transfer, whether made for or without a valuable | ||||||
9 | consideration, for
resale in any form as tangible personal | ||||||
10 | property unless made in compliance
with Section 2c of this | ||||||
11 | Act.
| ||||||
12 | Sales of tangible personal property, which property, to | ||||||
13 | the extent not
first subjected to a use for which it was | ||||||
14 | purchased, as an ingredient or
constituent, goes into and | ||||||
15 | forms a part of tangible personal property
subsequently the | ||||||
16 | subject of a "Sale at retail", are not sales at retail as
| ||||||
17 | defined in this Act: Provided that the property purchased is | ||||||
18 | deemed to be
purchased for the purpose of resale, despite | ||||||
19 | first being used, to the
extent to which it is resold as an | ||||||
20 | ingredient of an intentionally produced
product or byproduct | ||||||
21 | of manufacturing.
| ||||||
22 | "Sale at retail" shall be construed to include any | ||||||
23 | Illinois florist's
sales transaction in which the purchase | ||||||
24 | order is received in Illinois by a
florist and the sale is for | ||||||
25 | use or consumption, but the Illinois florist
has a florist in | ||||||
26 | another state deliver the property to the purchaser or the
|
| |||||||
| |||||||
1 | purchaser's donee in such other state.
| ||||||
2 | Nonreusable tangible personal property that is used by | ||||||
3 | persons engaged in
the business of operating a restaurant, | ||||||
4 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
5 | transferred to customers in the ordinary course of business
as | ||||||
6 | part of the sale of food or beverages and is used to deliver, | ||||||
7 | package, or
consume food or beverages, regardless of where | ||||||
8 | consumption of the food or
beverages occurs. Examples of those | ||||||
9 | items include, but are not limited to
nonreusable, paper and | ||||||
10 | plastic cups, plates, baskets, boxes, sleeves, buckets
or | ||||||
11 | other containers, utensils, straws, placemats, napkins, doggie | ||||||
12 | bags, and
wrapping or packaging
materials that are transferred | ||||||
13 | to customers as part of the sale of food or
beverages in the | ||||||
14 | ordinary course of business.
| ||||||
15 | The purchase, employment and transfer of such tangible | ||||||
16 | personal property
as newsprint and ink for the primary purpose | ||||||
17 | of conveying news (with or
without other information) is not a | ||||||
18 | purchase, use or sale of tangible
personal property.
| ||||||
19 | A person whose activities are organized and conducted | ||||||
20 | primarily as a
not-for-profit service enterprise, and who | ||||||
21 | engages in selling tangible
personal property at retail | ||||||
22 | (whether to the public or merely to members and
their guests) | ||||||
23 | is engaged in the business of selling tangible personal
| ||||||
24 | property at retail with respect to such transactions, | ||||||
25 | excepting only a
person organized and operated exclusively for | ||||||
26 | charitable, religious or
educational purposes either (1), to |
| |||||||
| |||||||
1 | the extent of sales by such person to
its members, students, | ||||||
2 | patients or inmates of tangible personal property to
be used | ||||||
3 | primarily for the purposes of such person, or (2), to the | ||||||
4 | extent of
sales by such person of tangible personal property | ||||||
5 | which is not sold or
offered for sale by persons organized for | ||||||
6 | profit. The selling of school
books and school supplies by | ||||||
7 | schools at retail to students is not
"primarily for the | ||||||
8 | purposes of" the school which does such selling. The
| ||||||
9 | provisions of this paragraph shall not apply to nor subject to | ||||||
10 | taxation
occasional dinners, socials or similar activities of | ||||||
11 | a person organized and
operated exclusively for charitable, | ||||||
12 | religious or educational purposes,
whether or not such | ||||||
13 | activities are open to the public.
| ||||||
14 | A person who is the recipient of a grant or contract under | ||||||
15 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | ||||||
16 | serves meals to
participants in the federal Nutrition Program | ||||||
17 | for the Elderly in return for
contributions established in | ||||||
18 | amount by the individual participant pursuant
to a schedule of | ||||||
19 | suggested fees as provided for in the federal Act is not
| ||||||
20 | engaged in the business of selling tangible personal property | ||||||
21 | at retail
with respect to such transactions.
| ||||||
22 | "Purchaser" means anyone who, through a sale at retail, | ||||||
23 | acquires the
ownership of or title to tangible personal | ||||||
24 | property for a valuable
consideration.
| ||||||
25 | "Reseller of motor fuel" means any person engaged in the | ||||||
26 | business of selling
or delivering or transferring title of |
| |||||||
| |||||||
1 | motor fuel to another person
other than for use or | ||||||
2 | consumption.
No person shall act as a reseller of motor fuel | ||||||
3 | within this State without
first being registered as a reseller | ||||||
4 | pursuant to Section 2c or a retailer
pursuant to Section 2a.
| ||||||
5 | "Selling price" or the "amount of sale" means the | ||||||
6 | consideration for a
sale valued in money whether received in | ||||||
7 | money or otherwise, including
cash, credits, property, other | ||||||
8 | than as hereinafter provided, and services,
but, prior to | ||||||
9 | January 1, 2020 and beginning again on January 1, 2022, not | ||||||
10 | including the value of or credit given for traded-in tangible
| ||||||
11 | personal property where the item that is traded-in is of like | ||||||
12 | kind and
character as that which is being sold; beginning | ||||||
13 | January 1, 2020 and until January 1, 2022, "selling price" | ||||||
14 | includes the portion of the value of or credit given for | ||||||
15 | traded-in motor vehicles of the First Division as defined in | ||||||
16 | Section 1-146 of the Illinois Vehicle Code of like kind and | ||||||
17 | character as that which is being sold that exceeds $10,000. | ||||||
18 | "Selling price" shall be determined without any
deduction on | ||||||
19 | account of the cost of the property sold, the cost of
materials | ||||||
20 | used, labor or service cost or any other expense whatsoever, | ||||||
21 | but
does not include charges that are added to prices by | ||||||
22 | sellers on account of
the seller's tax liability under this | ||||||
23 | Act, or on account of the seller's
duty to collect, from the | ||||||
24 | purchaser, the tax that is imposed by the Use Tax
Act, or, | ||||||
25 | except as otherwise provided with respect to any cigarette tax | ||||||
26 | imposed by a home rule unit, on account of the seller's tax |
| |||||||
| |||||||
1 | liability under any local occupation tax administered by the | ||||||
2 | Department, or, except as otherwise provided with respect to | ||||||
3 | any cigarette tax imposed by a home rule unit on account of the | ||||||
4 | seller's duty to collect, from the purchasers, the tax that is | ||||||
5 | imposed under any local use tax administered by the | ||||||
6 | Department.
Effective December 1, 1985, "selling price" shall | ||||||
7 | include charges that
are added to prices by sellers on account | ||||||
8 | of the seller's
tax liability under the Cigarette Tax Act, on | ||||||
9 | account of the sellers'
duty to collect, from the purchaser, | ||||||
10 | the tax imposed under the Cigarette
Use Tax Act, and on account | ||||||
11 | of the seller's duty to collect, from the
purchaser, any | ||||||
12 | cigarette tax imposed by a home rule unit.
| ||||||
13 | Notwithstanding any law to the contrary, for any motor | ||||||
14 | vehicle, as defined in Section 1-146 of the Vehicle Code, that | ||||||
15 | is sold on or after January 1, 2015 for the purpose of leasing | ||||||
16 | the vehicle for a defined period that is longer than one year | ||||||
17 | and (1) is a motor vehicle of the second division that: (A) is | ||||||
18 | a self-contained motor vehicle designed or permanently | ||||||
19 | converted to provide living quarters for recreational, | ||||||
20 | camping, or travel use, with direct walk through access to the | ||||||
21 | living quarters from the driver's seat; (B) is of the van | ||||||
22 | configuration designed for the transportation of not less than | ||||||
23 | 7 nor more than 16 passengers; or (C) has a gross vehicle | ||||||
24 | weight rating of 8,000 pounds or less or (2) is a motor vehicle | ||||||
25 | of the first division, "selling price" or "amount of sale" | ||||||
26 | means the consideration received by the lessor pursuant to the |
| |||||||
| |||||||
1 | lease contract, including amounts due at lease signing and all | ||||||
2 | monthly or other regular payments charged over the term of the | ||||||
3 | lease. Also included in the selling price is any amount | ||||||
4 | received by the lessor from the lessee for the leased vehicle | ||||||
5 | that is not calculated at the time the lease is executed, | ||||||
6 | including, but not limited to, excess mileage charges and | ||||||
7 | charges for excess wear and tear. For sales that occur in | ||||||
8 | Illinois, with respect to any amount received by the lessor | ||||||
9 | from the lessee for the leased vehicle that is not calculated | ||||||
10 | at the time the lease is executed, the lessor who purchased the | ||||||
11 | motor vehicle does not incur the tax imposed by the Use Tax Act | ||||||
12 | on those amounts, and the retailer who makes the retail sale of | ||||||
13 | the motor vehicle to the lessor is not required to collect the | ||||||
14 | tax imposed by the Use Tax Act or to pay the tax imposed by | ||||||
15 | this Act on those amounts. However, the lessor who purchased | ||||||
16 | the motor vehicle assumes the liability for reporting and | ||||||
17 | paying the tax on those amounts directly to the Department in | ||||||
18 | the same form (Illinois Retailers' Occupation Tax, and local | ||||||
19 | retailers' occupation taxes, if applicable) in which the | ||||||
20 | retailer would have reported and paid such tax if the retailer | ||||||
21 | had accounted for the tax to the Department. For amounts | ||||||
22 | received by the lessor from the lessee that are not calculated | ||||||
23 | at the time the lease is executed, the lessor must file the | ||||||
24 | return and pay the tax to the Department by the due date | ||||||
25 | otherwise required by this Act for returns other than | ||||||
26 | transaction returns. If the retailer is entitled under this |
| |||||||
| |||||||
1 | Act to a discount for collecting and remitting the tax imposed | ||||||
2 | under this Act to the Department with respect to the sale of | ||||||
3 | the motor vehicle to the lessor, then the right to the discount | ||||||
4 | provided in this Act shall be transferred to the lessor with | ||||||
5 | respect to the tax paid by the lessor for any amount received | ||||||
6 | by the lessor from the lessee for the leased vehicle that is | ||||||
7 | not calculated at the time the lease is executed; provided | ||||||
8 | that the discount is only allowed if the return is timely filed | ||||||
9 | and for amounts timely paid. The "selling price" of a motor | ||||||
10 | vehicle that is sold on or after January 1, 2015 for the | ||||||
11 | purpose of leasing for a defined period of longer than one year | ||||||
12 | shall not be reduced by the value of or credit given for | ||||||
13 | traded-in tangible personal property owned by the lessor, nor | ||||||
14 | shall it be reduced by the value of or credit given for | ||||||
15 | traded-in tangible personal property owned by the lessee, | ||||||
16 | regardless of whether the trade-in value thereof is assigned | ||||||
17 | by the lessee to the lessor. In the case of a motor vehicle | ||||||
18 | that is sold for the purpose of leasing for a defined period of | ||||||
19 | longer than one year, the sale occurs at the time of the | ||||||
20 | delivery of the vehicle, regardless of the due date of any | ||||||
21 | lease payments. A lessor who incurs a Retailers' Occupation | ||||||
22 | Tax liability on the sale of a motor vehicle coming off lease | ||||||
23 | may not take a credit against that liability for the Use Tax | ||||||
24 | the lessor paid upon the purchase of the motor vehicle (or for | ||||||
25 | any tax the lessor paid with respect to any amount received by | ||||||
26 | the lessor from the lessee for the leased vehicle that was not |
| |||||||
| |||||||
1 | calculated at the time the lease was executed) if the selling | ||||||
2 | price of the motor vehicle at the time of purchase was | ||||||
3 | calculated using the definition of "selling price" as defined | ||||||
4 | in this paragraph.
Notwithstanding any other provision of this | ||||||
5 | Act to the contrary, lessors shall file all returns and make | ||||||
6 | all payments required under this paragraph to the Department | ||||||
7 | by electronic means in the manner and form as required by the | ||||||
8 | Department. This paragraph does not apply to leases of motor | ||||||
9 | vehicles for which, at the time the lease is entered into, the | ||||||
10 | term of the lease is not a defined period, including leases | ||||||
11 | with a defined initial period with the option to continue the | ||||||
12 | lease on a month-to-month or other basis beyond the initial | ||||||
13 | defined period. | ||||||
14 | The phrase "like kind and character" shall be liberally | ||||||
15 | construed
(including but not limited to any form of motor | ||||||
16 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
17 | agricultural implement for any other
kind of farm or | ||||||
18 | agricultural implement), while not including a kind of item
| ||||||
19 | which, if sold at retail by that retailer, would be exempt from | ||||||
20 | retailers'
occupation tax and use tax as an isolated or | ||||||
21 | occasional sale.
| ||||||
22 | "Gross receipts" from the sales of tangible personal | ||||||
23 | property at retail
means the total selling price or the amount | ||||||
24 | of such sales, as hereinbefore
defined. In the case of charge | ||||||
25 | and time sales, the amount thereof shall be
included only as | ||||||
26 | and when payments are received by the seller.
Receipts or |
| |||||||
| |||||||
1 | other consideration derived by a seller from
the sale, | ||||||
2 | transfer or assignment of accounts receivable to a wholly | ||||||
3 | owned
subsidiary will not be deemed payments prior to the time | ||||||
4 | the purchaser
makes payment on such accounts.
| ||||||
5 | "Department" means the Department of Revenue.
| ||||||
6 | "Person" means any natural individual, firm, partnership, | ||||||
7 | association,
joint stock company, joint adventure, public or | ||||||
8 | private corporation, limited
liability company, or a receiver, | ||||||
9 | executor, trustee, guardian or other
representative appointed | ||||||
10 | by order of any court.
| ||||||
11 | The isolated or occasional sale of tangible personal | ||||||
12 | property at retail
by a person who does not hold himself out as | ||||||
13 | being engaged (or who does not
habitually engage) in selling | ||||||
14 | such tangible personal property at retail, or
a sale through a | ||||||
15 | bulk vending machine, does not constitute engaging in a
| ||||||
16 | business of selling such tangible personal property at retail | ||||||
17 | within the
meaning of this Act; provided that any person who is | ||||||
18 | engaged in a business
which is not subject to the tax imposed | ||||||
19 | by this Act because of involving
the sale of or a contract to | ||||||
20 | sell real estate or a construction contract to
improve real | ||||||
21 | estate or a construction contract to engineer, install, and
| ||||||
22 | maintain an integrated system of products, but who, in the | ||||||
23 | course of
conducting such business,
transfers tangible | ||||||
24 | personal property to users or consumers in the finished
form | ||||||
25 | in which it was purchased, and which does not become real | ||||||
26 | estate or was
not engineered and installed, under any |
| |||||||
| |||||||
1 | provision of a construction contract or
real estate sale or | ||||||
2 | real estate sales agreement entered into with some other
| ||||||
3 | person arising out of or because of such nontaxable business, | ||||||
4 | is engaged in the
business of selling tangible personal | ||||||
5 | property at retail to the extent of the
value of the tangible | ||||||
6 | personal property so transferred. If, in such a
transaction, a | ||||||
7 | separate charge is made for the tangible personal property so
| ||||||
8 | transferred, the value of such property, for the purpose of | ||||||
9 | this Act, shall be
the amount so separately charged, but not | ||||||
10 | less than the cost of such property
to the transferor; if no | ||||||
11 | separate charge is made, the value of such property,
for the | ||||||
12 | purposes of this Act, is the cost to the transferor of such | ||||||
13 | tangible
personal property. Construction contracts for the | ||||||
14 | improvement of real estate
consisting of engineering, | ||||||
15 | installation, and maintenance of voice, data, video,
security, | ||||||
16 | and all telecommunication systems do not constitute engaging | ||||||
17 | in a
business of selling tangible personal property at retail | ||||||
18 | within the meaning of
this Act if they are sold at one | ||||||
19 | specified contract price.
| ||||||
20 | A person who holds himself or herself out as being engaged | ||||||
21 | (or who habitually
engages) in selling tangible personal | ||||||
22 | property at retail is a person
engaged in the business of | ||||||
23 | selling tangible personal property at retail
hereunder with | ||||||
24 | respect to such sales (and not primarily in a service
| ||||||
25 | occupation) notwithstanding the fact that such person designs | ||||||
26 | and produces
such tangible personal property on special order |
| |||||||
| |||||||
1 | for the purchaser and in
such a way as to render the property | ||||||
2 | of value only to such purchaser, if
such tangible personal | ||||||
3 | property so produced on special order serves
substantially the | ||||||
4 | same function as stock or standard items of tangible
personal | ||||||
5 | property that are sold at retail.
| ||||||
6 | Persons who engage in the business of transferring | ||||||
7 | tangible personal
property upon the redemption of trading | ||||||
8 | stamps are engaged in the business
of selling such property at | ||||||
9 | retail and shall be liable for and shall pay
the tax imposed by | ||||||
10 | this Act on the basis of the retail value of the
property | ||||||
11 | transferred upon redemption of such stamps.
| ||||||
12 | "Bulk vending machine" means a vending machine,
containing | ||||||
13 | unsorted confections, nuts, toys, or other items designed
| ||||||
14 | primarily to be used or played with by children
which, when a | ||||||
15 | coin or coins of a denomination not larger than $0.50 are
| ||||||
16 | inserted, are dispensed in equal portions, at random and
| ||||||
17 | without selection by the customer.
| ||||||
18 | "Remote retailer" means a retailer that does not maintain | ||||||
19 | within this State, directly or by a subsidiary, an office, | ||||||
20 | distribution house, sales house, warehouse or other place of | ||||||
21 | business, or any agent or other representative operating | ||||||
22 | within this State under the authority of the retailer or its | ||||||
23 | subsidiary, irrespective of whether such place of business or | ||||||
24 | agent is located here permanently or temporarily or whether | ||||||
25 | such retailer or subsidiary is licensed to do business in this | ||||||
26 | State. |
| |||||||
| |||||||
1 | "Marketplace" means a physical or electronic place, forum, | ||||||
2 | platform, application, or other method by which a marketplace | ||||||
3 | seller sells or offers to sell items. | ||||||
4 | "Marketplace facilitator" means a person who, pursuant to | ||||||
5 | an agreement with an unrelated third-party marketplace seller, | ||||||
6 | directly or indirectly through one or more affiliates | ||||||
7 | facilitates a retail sale by an unrelated third party | ||||||
8 | marketplace seller by: | ||||||
9 | (1) listing or advertising for sale by the marketplace | ||||||
10 | seller in a marketplace, tangible personal property that | ||||||
11 | is subject to tax under this Act; and | ||||||
12 | (2) either directly or indirectly, through agreements | ||||||
13 | or arrangements with third parties, collecting payment | ||||||
14 | from the customer and transmitting that payment to the | ||||||
15 | marketplace seller regardless of whether the marketplace | ||||||
16 | facilitator receives compensation or other consideration | ||||||
17 | in exchange for its services. | ||||||
18 | A person who provides advertising services, including | ||||||
19 | listing products for sale, is not considered a marketplace | ||||||
20 | facilitator, so long as the advertising service platform or | ||||||
21 | forum does not engage, directly or indirectly through one or | ||||||
22 | more affiliated persons, in the activities described in | ||||||
23 | paragraph (2) of this definition of "marketplace facilitator". | ||||||
24 | "Marketplace facilitator" does not include any person | ||||||
25 | licensed under the Auction License Act. This exemption does | ||||||
26 | not apply to any person who is an Internet auction listing |
| |||||||
| |||||||
1 | service, as defined by the Auction License Act. | ||||||
2 | "Marketplace seller" means a person that makes sales | ||||||
3 | through a marketplace operated by an unrelated third party | ||||||
4 | marketplace facilitator. | ||||||
5 | (Source: P.A. 101-31, eff. 6-28-19; 101-604, eff. 1-1-20; | ||||||
6 | 102-353, eff. 1-1-22; 102-634, eff. 8-27-21; revised 11-1-21.)
| ||||||
7 | (35 ILCS 120/2-5)
| ||||||
8 | Sec. 2-5. Exemptions. Gross receipts from proceeds from | ||||||
9 | the sale of
the following tangible personal property are | ||||||
10 | exempt from the tax imposed
by this Act:
| ||||||
11 | (1) Farm chemicals.
| ||||||
12 | (2) Farm machinery and equipment, both new and used, | ||||||
13 | including that
manufactured on special order, certified by | ||||||
14 | the purchaser to be used
primarily for production | ||||||
15 | agriculture or State or federal agricultural
programs, | ||||||
16 | including individual replacement parts for the machinery | ||||||
17 | and
equipment, including machinery and equipment purchased | ||||||
18 | for lease,
and including implements of husbandry defined | ||||||
19 | in Section 1-130 of
the Illinois Vehicle Code, farm | ||||||
20 | machinery and agricultural chemical and
fertilizer | ||||||
21 | spreaders, and nurse wagons required to be registered
| ||||||
22 | under Section 3-809 of the Illinois Vehicle Code,
but
| ||||||
23 | excluding other motor vehicles required to be registered | ||||||
24 | under the Illinois
Vehicle Code.
Horticultural polyhouses | ||||||
25 | or hoop houses used for propagating, growing, or
|
| |||||||
| |||||||
1 | overwintering plants shall be considered farm machinery | ||||||
2 | and equipment under
this item (2).
Agricultural chemical | ||||||
3 | tender tanks and dry boxes shall include units sold
| ||||||
4 | separately from a motor vehicle required to be licensed | ||||||
5 | and units sold mounted
on a motor vehicle required to be | ||||||
6 | licensed, if the selling price of the tender
is separately | ||||||
7 | stated.
| ||||||
8 | Farm machinery and equipment shall include precision | ||||||
9 | farming equipment
that is
installed or purchased to be | ||||||
10 | installed on farm machinery and equipment
including, but | ||||||
11 | not limited to, tractors, harvesters, sprayers, planters,
| ||||||
12 | seeders, or spreaders.
Precision farming equipment | ||||||
13 | includes, but is not limited to,
soil testing sensors, | ||||||
14 | computers, monitors, software, global positioning
and | ||||||
15 | mapping systems, and other such equipment.
| ||||||
16 | Farm machinery and equipment also includes computers, | ||||||
17 | sensors, software, and
related equipment used primarily in | ||||||
18 | the
computer-assisted operation of production agriculture | ||||||
19 | facilities, equipment,
and activities such as, but
not | ||||||
20 | limited to,
the collection, monitoring, and correlation of
| ||||||
21 | animal and crop data for the purpose of
formulating animal | ||||||
22 | diets and agricultural chemicals. This item (2) is exempt
| ||||||
23 | from the provisions of
Section 2-70.
| ||||||
24 | (3) Until July 1, 2003, distillation machinery and | ||||||
25 | equipment, sold as a
unit or kit,
assembled or installed | ||||||
26 | by the retailer, certified by the user to be used
only for |
| |||||||
| |||||||
1 | the production of ethyl alcohol that will be used for | ||||||
2 | consumption
as motor fuel or as a component of motor fuel | ||||||
3 | for the personal use of the
user, and not subject to sale | ||||||
4 | or resale.
| ||||||
5 | (4) Until July 1, 2003 and beginning again September | ||||||
6 | 1, 2004 through August 30, 2014, graphic arts machinery | ||||||
7 | and equipment, including
repair and
replacement parts, | ||||||
8 | both new and used, and including that manufactured on
| ||||||
9 | special order or purchased for lease, certified by the | ||||||
10 | purchaser to be used
primarily for graphic arts | ||||||
11 | production.
Equipment includes chemicals or
chemicals | ||||||
12 | acting as catalysts but only if
the chemicals or chemicals | ||||||
13 | acting as catalysts effect a direct and immediate
change | ||||||
14 | upon a
graphic arts product. Beginning on July 1, 2017, | ||||||
15 | graphic arts machinery and equipment is included in the | ||||||
16 | manufacturing and assembling machinery and equipment | ||||||
17 | exemption under paragraph (14).
| ||||||
18 | (5) A motor vehicle that is used for automobile | ||||||
19 | renting, as defined in the Automobile Renting Occupation | ||||||
20 | and Use Tax Act. This paragraph is exempt from
the | ||||||
21 | provisions of Section 2-70.
| ||||||
22 | (6) Personal property sold by a teacher-sponsored | ||||||
23 | student organization
affiliated with an elementary or | ||||||
24 | secondary school located in Illinois.
| ||||||
25 | (7) Until July 1, 2003, proceeds of that portion of | ||||||
26 | the selling price of
a passenger car the
sale of which is |
| |||||||
| |||||||
1 | subject to the Replacement Vehicle Tax.
| ||||||
2 | (8) Personal property sold to an Illinois county fair | ||||||
3 | association for
use in conducting, operating, or promoting | ||||||
4 | the county fair.
| ||||||
5 | (9) Personal property sold to a not-for-profit arts
or | ||||||
6 | cultural organization that establishes, by proof required | ||||||
7 | by the Department
by
rule, that it has received an | ||||||
8 | exemption under Section 501(c)(3) of the
Internal Revenue | ||||||
9 | Code and that is organized and operated primarily for the
| ||||||
10 | presentation
or support of arts or cultural programming, | ||||||
11 | activities, or services. These
organizations include, but | ||||||
12 | are not limited to, music and dramatic arts
organizations | ||||||
13 | such as symphony orchestras and theatrical groups, arts | ||||||
14 | and
cultural service organizations, local arts councils, | ||||||
15 | visual arts organizations,
and media arts organizations.
| ||||||
16 | On and after July 1, 2001 (the effective date of Public Act | ||||||
17 | 92-35), however, an entity otherwise eligible for this | ||||||
18 | exemption shall not
make tax-free purchases unless it has | ||||||
19 | an active identification number issued by
the Department.
| ||||||
20 | (10) Personal property sold by a corporation, society, | ||||||
21 | association,
foundation, institution, or organization, | ||||||
22 | other than a limited liability
company, that is organized | ||||||
23 | and operated as a not-for-profit service enterprise
for | ||||||
24 | the benefit of persons 65 years of age or older if the | ||||||
25 | personal property
was not purchased by the enterprise for | ||||||
26 | the purpose of resale by the
enterprise.
|
| |||||||
| |||||||
1 | (11) Personal property sold to a governmental body, to | ||||||
2 | a corporation,
society, association, foundation, or | ||||||
3 | institution organized and operated
exclusively for | ||||||
4 | charitable, religious, or educational purposes, or to a
| ||||||
5 | not-for-profit corporation, society, association, | ||||||
6 | foundation, institution,
or organization that has no | ||||||
7 | compensated officers or employees and that is
organized | ||||||
8 | and operated primarily for the recreation of persons 55 | ||||||
9 | years of
age or older. A limited liability company may | ||||||
10 | qualify for the exemption under
this paragraph only if the | ||||||
11 | limited liability company is organized and operated
| ||||||
12 | exclusively for educational purposes. On and after July 1, | ||||||
13 | 1987, however, no
entity otherwise eligible for this | ||||||
14 | exemption shall make tax-free purchases
unless it has an | ||||||
15 | active identification number issued by the Department.
| ||||||
16 | (12) (Blank).
| ||||||
17 | (12-5) On and after July 1, 2003 and through June 30, | ||||||
18 | 2004, motor vehicles of the second division
with a gross | ||||||
19 | vehicle weight in excess of 8,000 pounds
that
are
subject | ||||||
20 | to the commercial distribution fee imposed under Section | ||||||
21 | 3-815.1 of
the Illinois
Vehicle Code. Beginning on July 1, | ||||||
22 | 2004 and through June 30, 2005, the use in this State of | ||||||
23 | motor vehicles of the second division: (i) with a gross | ||||||
24 | vehicle weight rating in excess of 8,000 pounds; (ii) that | ||||||
25 | are subject to the commercial distribution fee imposed | ||||||
26 | under Section 3-815.1 of the Illinois Vehicle Code; and |
| |||||||
| |||||||
1 | (iii) that are primarily used for commercial purposes. | ||||||
2 | Through June 30, 2005, this
exemption applies to repair | ||||||
3 | and replacement parts added
after the
initial purchase of | ||||||
4 | such a motor vehicle if that motor vehicle is used in a
| ||||||
5 | manner that
would qualify for the rolling stock exemption | ||||||
6 | otherwise provided for in this
Act. For purposes of this | ||||||
7 | paragraph, "used for commercial purposes" means the | ||||||
8 | transportation of persons or property in furtherance of | ||||||
9 | any commercial or industrial enterprise whether for-hire | ||||||
10 | or not.
| ||||||
11 | (13) Proceeds from sales to owners, lessors, or
| ||||||
12 | shippers of
tangible personal property that is utilized by | ||||||
13 | interstate carriers for
hire for use as rolling stock | ||||||
14 | moving in interstate commerce
and equipment operated by a | ||||||
15 | telecommunications provider, licensed as a
common carrier | ||||||
16 | by the Federal Communications Commission, which is
| ||||||
17 | permanently installed in or affixed to aircraft moving in | ||||||
18 | interstate commerce.
| ||||||
19 | (14) Machinery and equipment that will be used by the | ||||||
20 | purchaser, or a
lessee of the purchaser, primarily in the | ||||||
21 | process of manufacturing or
assembling tangible personal | ||||||
22 | property for wholesale or retail sale or
lease, whether | ||||||
23 | the sale or lease is made directly by the manufacturer or | ||||||
24 | by
some other person, whether the materials used in the | ||||||
25 | process are owned by
the manufacturer or some other | ||||||
26 | person, or whether the sale or lease is made
apart from or |
| |||||||
| |||||||
1 | as an incident to the seller's engaging in the service
| ||||||
2 | occupation of producing machines, tools, dies, jigs, | ||||||
3 | patterns, gauges, or
other similar items of no commercial | ||||||
4 | value on special order for a particular
purchaser. The | ||||||
5 | exemption provided by this paragraph (14) does not include | ||||||
6 | machinery and equipment used in (i) the generation of | ||||||
7 | electricity for wholesale or retail sale; (ii) the | ||||||
8 | generation or treatment of natural or artificial gas for | ||||||
9 | wholesale or retail sale that is delivered to customers | ||||||
10 | through pipes, pipelines, or mains; or (iii) the treatment | ||||||
11 | of water for wholesale or retail sale that is delivered to | ||||||
12 | customers through pipes, pipelines, or mains. The | ||||||
13 | provisions of Public Act 98-583 are declaratory of | ||||||
14 | existing law as to the meaning and scope of this | ||||||
15 | exemption. Beginning on July 1, 2017, the exemption | ||||||
16 | provided by this paragraph (14) includes, but is not | ||||||
17 | limited to, graphic arts machinery and equipment, as | ||||||
18 | defined in paragraph (4) of this Section.
| ||||||
19 | (15) Proceeds of mandatory service charges separately | ||||||
20 | stated on
customers' bills for purchase and consumption of | ||||||
21 | food and beverages, to the
extent that the proceeds of the | ||||||
22 | service charge are in fact turned over as
tips or as a | ||||||
23 | substitute for tips to the employees who participate | ||||||
24 | directly
in preparing, serving, hosting or cleaning up the | ||||||
25 | food or beverage function
with respect to which the | ||||||
26 | service charge is imposed.
|
| |||||||
| |||||||
1 | (16) Tangible personal property sold to a purchaser if | ||||||
2 | the purchaser is exempt from use tax by operation of | ||||||
3 | federal law. This paragraph is exempt from the provisions | ||||||
4 | of Section 2-70.
| ||||||
5 | (17) Tangible personal property sold to a common | ||||||
6 | carrier by rail or
motor that
receives the physical | ||||||
7 | possession of the property in Illinois and that
transports | ||||||
8 | the property, or shares with another common carrier in the
| ||||||
9 | transportation of the property, out of Illinois on a | ||||||
10 | standard uniform bill
of lading showing the seller of the | ||||||
11 | property as the shipper or consignor of
the property to a | ||||||
12 | destination outside Illinois, for use outside Illinois.
| ||||||
13 | (18) Legal tender, currency, medallions, or gold or | ||||||
14 | silver coinage
issued by the State of Illinois, the | ||||||
15 | government of the United States of
America, or the | ||||||
16 | government of any foreign country, and bullion.
| ||||||
17 | (19) Until July 1, 2003, oil field exploration, | ||||||
18 | drilling, and production
equipment, including
(i) rigs and | ||||||
19 | parts of rigs, rotary rigs, cable tool
rigs, and workover | ||||||
20 | rigs, (ii) pipe and tubular goods, including casing and
| ||||||
21 | drill strings, (iii) pumps and pump-jack units, (iv) | ||||||
22 | storage tanks and flow
lines, (v) any individual | ||||||
23 | replacement part for oil field exploration,
drilling, and | ||||||
24 | production equipment, and (vi) machinery and equipment | ||||||
25 | purchased
for lease; but
excluding motor vehicles required | ||||||
26 | to be registered under the Illinois
Vehicle Code.
|
| |||||||
| |||||||
1 | (20) Photoprocessing machinery and equipment, | ||||||
2 | including repair and
replacement parts, both new and used, | ||||||
3 | including that manufactured on
special order, certified by | ||||||
4 | the purchaser to be used primarily for
photoprocessing, | ||||||
5 | and including photoprocessing machinery and equipment
| ||||||
6 | purchased for lease.
| ||||||
7 | (21) Until July 1, 2023, coal and aggregate | ||||||
8 | exploration, mining, off-highway hauling,
processing,
| ||||||
9 | maintenance, and reclamation equipment, including
| ||||||
10 | replacement parts and equipment, and including
equipment | ||||||
11 | purchased for lease, but excluding motor vehicles required | ||||||
12 | to be
registered under the Illinois Vehicle Code. The | ||||||
13 | changes made to this Section by Public Act 97-767 apply on | ||||||
14 | and after July 1, 2003, but no claim for credit or refund | ||||||
15 | is allowed on or after August 16, 2013 (the effective date | ||||||
16 | of Public Act 98-456)
for such taxes paid during the | ||||||
17 | period beginning July 1, 2003 and ending on August 16, | ||||||
18 | 2013 (the effective date of Public Act 98-456).
| ||||||
19 | (22) Until June 30, 2013, fuel and petroleum products | ||||||
20 | sold to or used by an air carrier,
certified by the carrier | ||||||
21 | to be used for consumption, shipment, or storage
in the | ||||||
22 | conduct of its business as an air common carrier, for a | ||||||
23 | flight
destined for or returning from a location or | ||||||
24 | locations
outside the United States without regard to | ||||||
25 | previous or subsequent domestic
stopovers.
| ||||||
26 | Beginning July 1, 2013, fuel and petroleum products |
| |||||||
| |||||||
1 | sold to or used by an air carrier, certified by the carrier | ||||||
2 | to be used for consumption, shipment, or storage in the | ||||||
3 | conduct of its business as an air common carrier, for a | ||||||
4 | flight that (i) is engaged in foreign trade or is engaged | ||||||
5 | in trade between the United States and any of its | ||||||
6 | possessions and (ii) transports at least one individual or | ||||||
7 | package for hire from the city of origination to the city | ||||||
8 | of final destination on the same aircraft, without regard | ||||||
9 | to a change in the flight number of that aircraft. | ||||||
10 | (23) A transaction in which the purchase order is | ||||||
11 | received by a florist
who is located outside Illinois, but | ||||||
12 | who has a florist located in Illinois
deliver the property | ||||||
13 | to the purchaser or the purchaser's donee in Illinois.
| ||||||
14 | (24) Fuel consumed or used in the operation of ships, | ||||||
15 | barges, or vessels
that are used primarily in or for the | ||||||
16 | transportation of property or the
conveyance of persons | ||||||
17 | for hire on rivers bordering on this State if the
fuel is | ||||||
18 | delivered by the seller to the purchaser's barge, ship, or | ||||||
19 | vessel
while it is afloat upon that bordering river.
| ||||||
20 | (25) Except as provided in item (25-5) of this | ||||||
21 | Section, a
motor vehicle sold in this State to a | ||||||
22 | nonresident even though the
motor vehicle is delivered to | ||||||
23 | the nonresident in this State, if the motor
vehicle is not | ||||||
24 | to be titled in this State, and if a drive-away permit
is | ||||||
25 | issued to the motor vehicle as provided in Section 3-603 | ||||||
26 | of the Illinois
Vehicle Code or if the nonresident |
| |||||||
| |||||||
1 | purchaser has vehicle registration
plates to transfer to | ||||||
2 | the motor vehicle upon returning to his or her home
state. | ||||||
3 | The issuance of the drive-away permit or having
the
| ||||||
4 | out-of-state registration plates to be transferred is | ||||||
5 | prima facie evidence
that the motor vehicle will not be | ||||||
6 | titled in this State.
| ||||||
7 | (25-5) The exemption under item (25) does not apply if | ||||||
8 | the state in which the motor vehicle will be titled does | ||||||
9 | not allow a reciprocal exemption for a motor vehicle sold | ||||||
10 | and delivered in that state to an Illinois resident but | ||||||
11 | titled in Illinois. The tax collected under this Act on | ||||||
12 | the sale of a motor vehicle in this State to a resident of | ||||||
13 | another state that does not allow a reciprocal exemption | ||||||
14 | shall be imposed at a rate equal to the state's rate of tax | ||||||
15 | on taxable property in the state in which the purchaser is | ||||||
16 | a resident, except that the tax shall not exceed the tax | ||||||
17 | that would otherwise be imposed under this Act. At the | ||||||
18 | time of the sale, the purchaser shall execute a statement, | ||||||
19 | signed under penalty of perjury, of his or her intent to | ||||||
20 | title the vehicle in the state in which the purchaser is a | ||||||
21 | resident within 30 days after the sale and of the fact of | ||||||
22 | the payment to the State of Illinois of tax in an amount | ||||||
23 | equivalent to the state's rate of tax on taxable property | ||||||
24 | in his or her state of residence and shall submit the | ||||||
25 | statement to the appropriate tax collection agency in his | ||||||
26 | or her state of residence. In addition, the retailer must |
| |||||||
| |||||||
1 | retain a signed copy of the statement in his or her | ||||||
2 | records. Nothing in this item shall be construed to | ||||||
3 | require the removal of the vehicle from this state | ||||||
4 | following the filing of an intent to title the vehicle in | ||||||
5 | the purchaser's state of residence if the purchaser titles | ||||||
6 | the vehicle in his or her state of residence within 30 days | ||||||
7 | after the date of sale. The tax collected under this Act in | ||||||
8 | accordance with this item (25-5) shall be proportionately | ||||||
9 | distributed as if the tax were collected at the 6.25% | ||||||
10 | general rate imposed under this Act.
| ||||||
11 | (25-7) Beginning on July 1, 2007, no tax is imposed | ||||||
12 | under this Act on the sale of an aircraft, as defined in | ||||||
13 | Section 3 of the Illinois Aeronautics Act, if all of the | ||||||
14 | following conditions are met: | ||||||
15 | (1) the aircraft leaves this State within 15 days | ||||||
16 | after the later of either the issuance of the final | ||||||
17 | billing for the sale of the aircraft, or the | ||||||
18 | authorized approval for return to service, completion | ||||||
19 | of the maintenance record entry, and completion of the | ||||||
20 | test flight and ground test for inspection, as | ||||||
21 | required by 14 C.F.R. 91.407; | ||||||
22 | (2) the aircraft is not based or registered in | ||||||
23 | this State after the sale of the aircraft; and | ||||||
24 | (3) the seller retains in his or her books and | ||||||
25 | records and provides to the Department a signed and | ||||||
26 | dated certification from the purchaser, on a form |
| |||||||
| |||||||
1 | prescribed by the Department, certifying that the | ||||||
2 | requirements of this item (25-7) are met. The | ||||||
3 | certificate must also include the name and address of | ||||||
4 | the purchaser, the address of the location where the | ||||||
5 | aircraft is to be titled or registered, the address of | ||||||
6 | the primary physical location of the aircraft, and | ||||||
7 | other information that the Department may reasonably | ||||||
8 | require. | ||||||
9 | For purposes of this item (25-7): | ||||||
10 | "Based in this State" means hangared, stored, or | ||||||
11 | otherwise used, excluding post-sale customizations as | ||||||
12 | defined in this Section, for 10 or more days in each | ||||||
13 | 12-month period immediately following the date of the sale | ||||||
14 | of the aircraft. | ||||||
15 | "Registered in this State" means an aircraft | ||||||
16 | registered with the Department of Transportation, | ||||||
17 | Aeronautics Division, or titled or registered with the | ||||||
18 | Federal Aviation Administration to an address located in | ||||||
19 | this State. | ||||||
20 | This paragraph (25-7) is exempt from the provisions
of
| ||||||
21 | Section 2-70.
| ||||||
22 | (26) Semen used for artificial insemination of | ||||||
23 | livestock for direct
agricultural production.
| ||||||
24 | (27) Horses, or interests in horses, registered with | ||||||
25 | and meeting the
requirements of any of the
Arabian Horse | ||||||
26 | Club Registry of America, Appaloosa Horse Club, American |
| |||||||
| |||||||
1 | Quarter
Horse Association, United States
Trotting | ||||||
2 | Association, or Jockey Club, as appropriate, used for
| ||||||
3 | purposes of breeding or racing for prizes. This item (27) | ||||||
4 | is exempt from the provisions of Section 2-70, and the | ||||||
5 | exemption provided for under this item (27) applies for | ||||||
6 | all periods beginning May 30, 1995, but no claim for | ||||||
7 | credit or refund is allowed on or after January 1, 2008 | ||||||
8 | (the effective date of Public Act 95-88)
for such taxes | ||||||
9 | paid during the period beginning May 30, 2000 and ending | ||||||
10 | on January 1, 2008 (the effective date of Public Act | ||||||
11 | 95-88).
| ||||||
12 | (28) Computers and communications equipment utilized | ||||||
13 | for any
hospital
purpose
and equipment used in the | ||||||
14 | diagnosis,
analysis, or treatment of hospital patients | ||||||
15 | sold to a lessor who leases the
equipment, under a lease of | ||||||
16 | one year or longer executed or in effect at the
time of the | ||||||
17 | purchase, to a
hospital
that has been issued an active tax | ||||||
18 | exemption identification number by the
Department under | ||||||
19 | Section 1g of this Act.
| ||||||
20 | (29) Personal property sold to a lessor who leases the
| ||||||
21 | property, under a
lease of one year or longer executed or | ||||||
22 | in effect at the time of the purchase,
to a governmental | ||||||
23 | body
that has been issued an active tax exemption | ||||||
24 | identification number by the
Department under Section 1g | ||||||
25 | of this Act.
| ||||||
26 | (30) Beginning with taxable years ending on or after |
| |||||||
| |||||||
1 | December
31, 1995
and
ending with taxable years ending on | ||||||
2 | or before December 31, 2004,
personal property that is
| ||||||
3 | donated for disaster relief to be used in a State or | ||||||
4 | federally declared
disaster area in Illinois or bordering | ||||||
5 | Illinois by a manufacturer or retailer
that is registered | ||||||
6 | in this State to a corporation, society, association,
| ||||||
7 | foundation, or institution that has been issued a sales | ||||||
8 | tax exemption
identification number by the Department that | ||||||
9 | assists victims of the disaster
who reside within the | ||||||
10 | declared disaster area.
| ||||||
11 | (31) Beginning with taxable years ending on or after | ||||||
12 | December
31, 1995 and
ending with taxable years ending on | ||||||
13 | or before December 31, 2004, personal
property that is | ||||||
14 | used in the performance of infrastructure repairs in this
| ||||||
15 | State, including but not limited to municipal roads and | ||||||
16 | streets, access roads,
bridges, sidewalks, waste disposal | ||||||
17 | systems, water and sewer line extensions,
water | ||||||
18 | distribution and purification facilities, storm water | ||||||
19 | drainage and
retention facilities, and sewage treatment | ||||||
20 | facilities, resulting from a State
or federally declared | ||||||
21 | disaster in Illinois or bordering Illinois when such
| ||||||
22 | repairs are initiated on facilities located in the | ||||||
23 | declared disaster area
within 6 months after the disaster.
| ||||||
24 | (32) Beginning July 1, 1999, game or game birds sold | ||||||
25 | at a "game breeding
and
hunting preserve area" as that | ||||||
26 | term is used
in the
Wildlife Code. This paragraph is |
| |||||||
| |||||||
1 | exempt from the provisions
of
Section 2-70.
| ||||||
2 | (33) A motor vehicle, as that term is defined in | ||||||
3 | Section 1-146
of the
Illinois Vehicle Code, that is | ||||||
4 | donated to a corporation, limited liability
company, | ||||||
5 | society, association, foundation, or institution that is | ||||||
6 | determined by
the Department to be organized and operated | ||||||
7 | exclusively for educational
purposes. For purposes of this | ||||||
8 | exemption, "a corporation, limited liability
company, | ||||||
9 | society, association, foundation, or institution organized | ||||||
10 | and
operated
exclusively for educational purposes" means | ||||||
11 | all tax-supported public schools,
private schools that | ||||||
12 | offer systematic instruction in useful branches of
| ||||||
13 | learning by methods common to public schools and that | ||||||
14 | compare favorably in
their scope and intensity with the | ||||||
15 | course of study presented in tax-supported
schools, and | ||||||
16 | vocational or technical schools or institutes organized | ||||||
17 | and
operated exclusively to provide a course of study of | ||||||
18 | not less than 6 weeks
duration and designed to prepare | ||||||
19 | individuals to follow a trade or to pursue a
manual, | ||||||
20 | technical, mechanical, industrial, business, or commercial
| ||||||
21 | occupation.
| ||||||
22 | (34) Beginning January 1, 2000, personal property, | ||||||
23 | including food, purchased
through fundraising events for | ||||||
24 | the benefit of a public or private elementary or
secondary | ||||||
25 | school, a group of those schools, or one or more school | ||||||
26 | districts if
the events are sponsored by an entity |
| |||||||
| |||||||
1 | recognized by the school district that
consists primarily | ||||||
2 | of volunteers and includes parents and teachers of the
| ||||||
3 | school children. This paragraph does not apply to | ||||||
4 | fundraising events (i) for
the benefit of private home | ||||||
5 | instruction or (ii) for which the fundraising
entity | ||||||
6 | purchases the personal property sold at the events from | ||||||
7 | another
individual or entity that sold the property for | ||||||
8 | the purpose of resale by the
fundraising entity and that | ||||||
9 | profits from the sale to the fundraising entity.
This | ||||||
10 | paragraph is exempt from the provisions of Section 2-70.
| ||||||
11 | (35) Beginning January 1, 2000 and through December | ||||||
12 | 31, 2001, new or used
automatic vending machines that | ||||||
13 | prepare and serve hot food and beverages,
including | ||||||
14 | coffee, soup, and other items, and replacement parts for | ||||||
15 | these
machines. Beginning January 1, 2002 and through June | ||||||
16 | 30, 2003, machines
and parts for machines used in
| ||||||
17 | commercial, coin-operated amusement and vending business | ||||||
18 | if a use or occupation
tax is paid on the gross receipts | ||||||
19 | derived from the use of the commercial,
coin-operated | ||||||
20 | amusement and vending machines. This paragraph is exempt | ||||||
21 | from
the provisions of Section 2-70.
| ||||||
22 | (35-5) Beginning August 23, 2001 and through June 30, | ||||||
23 | 2016, food for human consumption that is to be consumed | ||||||
24 | off
the premises where it is sold (other than alcoholic | ||||||
25 | beverages, soft drinks,
and food that has been prepared | ||||||
26 | for immediate consumption) and prescription
and |
| |||||||
| |||||||
1 | nonprescription medicines, drugs, medical appliances, and | ||||||
2 | insulin, urine
testing materials, syringes, and needles | ||||||
3 | used by diabetics, for human use, when
purchased for use | ||||||
4 | by a person receiving medical assistance under Article V | ||||||
5 | of
the Illinois Public Aid Code who resides in a licensed | ||||||
6 | long-term care facility,
as defined in the Nursing Home | ||||||
7 | Care Act, or a licensed facility as defined in the ID/DD | ||||||
8 | Community Care Act, the MC/DD Act, or the Specialized | ||||||
9 | Mental Health Rehabilitation Act of 2013.
| ||||||
10 | (36) Beginning August 2, 2001, computers and | ||||||
11 | communications equipment
utilized for any hospital purpose | ||||||
12 | and equipment used in the diagnosis,
analysis, or | ||||||
13 | treatment of hospital patients sold to a lessor who leases | ||||||
14 | the
equipment, under a lease of one year or longer | ||||||
15 | executed or in effect at the
time of the purchase, to a | ||||||
16 | hospital that has been issued an active tax
exemption | ||||||
17 | identification number by the Department under Section 1g | ||||||
18 | of this Act.
This paragraph is exempt from the provisions | ||||||
19 | of Section 2-70.
| ||||||
20 | (37) Beginning August 2, 2001, personal property sold | ||||||
21 | to a lessor who
leases the property, under a lease of one | ||||||
22 | year or longer executed or in effect
at the time of the | ||||||
23 | purchase, to a governmental body that has been issued an
| ||||||
24 | active tax exemption identification number by the | ||||||
25 | Department under Section 1g
of this Act. This paragraph is | ||||||
26 | exempt from the provisions of Section 2-70.
|
| |||||||
| |||||||
1 | (38) Beginning on January 1, 2002 and through June 30, | ||||||
2 | 2016, tangible personal property purchased
from an | ||||||
3 | Illinois retailer by a taxpayer engaged in centralized | ||||||
4 | purchasing
activities in Illinois who will, upon receipt | ||||||
5 | of the property in Illinois,
temporarily store the | ||||||
6 | property in Illinois (i) for the purpose of subsequently
| ||||||
7 | transporting it outside this State for use or consumption | ||||||
8 | thereafter solely
outside this State or (ii) for the | ||||||
9 | purpose of being processed, fabricated, or
manufactured | ||||||
10 | into, attached to, or incorporated into other tangible | ||||||
11 | personal
property to be transported outside this State and | ||||||
12 | thereafter used or consumed
solely outside this State. The | ||||||
13 | Director of Revenue shall, pursuant to rules
adopted in | ||||||
14 | accordance with the Illinois Administrative Procedure Act, | ||||||
15 | issue a
permit to any taxpayer in good standing with the | ||||||
16 | Department who is eligible for
the exemption under this | ||||||
17 | paragraph (38). The permit issued under
this paragraph | ||||||
18 | (38) shall authorize the holder, to the extent and
in the | ||||||
19 | manner specified in the rules adopted under this Act, to | ||||||
20 | purchase
tangible personal property from a retailer exempt | ||||||
21 | from the taxes imposed by
this Act. Taxpayers shall | ||||||
22 | maintain all necessary books and records to
substantiate | ||||||
23 | the use and consumption of all such tangible personal | ||||||
24 | property
outside of the State of Illinois.
| ||||||
25 | (39) Beginning January 1, 2008, tangible personal | ||||||
26 | property used in the construction or maintenance of a |
| |||||||
| |||||||
1 | community water supply, as defined under Section 3.145 of | ||||||
2 | the Environmental Protection Act, that is operated by a | ||||||
3 | not-for-profit corporation that holds a valid water supply | ||||||
4 | permit issued under Title IV of the Environmental | ||||||
5 | Protection Act. This paragraph is exempt from the | ||||||
6 | provisions of Section 2-70.
| ||||||
7 | (40) Beginning January 1, 2010 and continuing through | ||||||
8 | December 31, 2024, materials, parts, equipment, | ||||||
9 | components, and furnishings incorporated into or upon an | ||||||
10 | aircraft as part of the modification, refurbishment, | ||||||
11 | completion, replacement, repair, or maintenance of the | ||||||
12 | aircraft. This exemption includes consumable supplies used | ||||||
13 | in the modification, refurbishment, completion, | ||||||
14 | replacement, repair, and maintenance of aircraft, but | ||||||
15 | excludes any materials, parts, equipment, components, and | ||||||
16 | consumable supplies used in the modification, replacement, | ||||||
17 | repair, and maintenance of aircraft engines or power | ||||||
18 | plants, whether such engines or power plants are installed | ||||||
19 | or uninstalled upon any such aircraft. "Consumable | ||||||
20 | supplies" include, but are not limited to, adhesive, tape, | ||||||
21 | sandpaper, general purpose lubricants, cleaning solution, | ||||||
22 | latex gloves, and protective films. This exemption applies | ||||||
23 | only to the sale of qualifying tangible personal property | ||||||
24 | to persons who modify, refurbish, complete, replace, or | ||||||
25 | maintain an aircraft and who (i) hold an Air Agency | ||||||
26 | Certificate and are empowered to operate an approved |
| |||||||
| |||||||
1 | repair station by the Federal Aviation Administration, | ||||||
2 | (ii) have a Class IV Rating, and (iii) conduct operations | ||||||
3 | in accordance with Part 145 of the Federal Aviation | ||||||
4 | Regulations. The exemption does not include aircraft | ||||||
5 | operated by a commercial air carrier providing scheduled | ||||||
6 | passenger air service pursuant to authority issued under | ||||||
7 | Part 121 or Part 129 of the Federal Aviation Regulations. | ||||||
8 | The changes made to this paragraph (40) by Public Act | ||||||
9 | 98-534 are declarative of existing law. It is the intent | ||||||
10 | of the General Assembly that the exemption under this | ||||||
11 | paragraph (40) applies continuously from January 1, 2010 | ||||||
12 | through December 31, 2024; however, no claim for credit or | ||||||
13 | refund is allowed for taxes paid as a result of the | ||||||
14 | disallowance of this exemption on or after January 1, 2015 | ||||||
15 | and prior to the effective date of this amendatory Act of | ||||||
16 | the 101st General Assembly. | ||||||
17 | (41) Tangible personal property sold to a | ||||||
18 | public-facilities corporation, as described in Section | ||||||
19 | 11-65-10 of the Illinois Municipal Code, for purposes of | ||||||
20 | constructing or furnishing a municipal convention hall, | ||||||
21 | but only if the legal title to the municipal convention | ||||||
22 | hall is transferred to the municipality without any | ||||||
23 | further consideration by or on behalf of the municipality | ||||||
24 | at the time of the completion of the municipal convention | ||||||
25 | hall or upon the retirement or redemption of any bonds or | ||||||
26 | other debt instruments issued by the public-facilities |
| |||||||
| |||||||
1 | corporation in connection with the development of the | ||||||
2 | municipal convention hall. This exemption includes | ||||||
3 | existing public-facilities corporations as provided in | ||||||
4 | Section 11-65-25 of the Illinois Municipal Code. This | ||||||
5 | paragraph is exempt from the provisions of Section 2-70. | ||||||
6 | (42) Beginning January 1, 2017 and through December | ||||||
7 | 31, 2026, menstrual pads, tampons, and menstrual cups. | ||||||
8 | (43) Merchandise that is subject to the Rental | ||||||
9 | Purchase Agreement Occupation and Use Tax. The purchaser | ||||||
10 | must certify that the item is purchased to be rented | ||||||
11 | subject to a rental purchase agreement, as defined in the | ||||||
12 | Rental Purchase Agreement Act, and provide proof of | ||||||
13 | registration under the Rental Purchase Agreement | ||||||
14 | Occupation and Use Tax Act. This paragraph is exempt from | ||||||
15 | the provisions of Section 2-70. | ||||||
16 | (44) Qualified tangible personal property used in the | ||||||
17 | construction or operation of a data center that has been | ||||||
18 | granted a certificate of exemption by the Department of | ||||||
19 | Commerce and Economic Opportunity, whether that tangible | ||||||
20 | personal property is purchased by the owner, operator, or | ||||||
21 | tenant of the data center or by a contractor or | ||||||
22 | subcontractor of the owner, operator, or tenant. Data | ||||||
23 | centers that would have qualified for a certificate of | ||||||
24 | exemption prior to January 1, 2020 had this amendatory Act | ||||||
25 | of the 101st General Assembly been in effect, may apply | ||||||
26 | for and obtain an exemption for subsequent purchases of |
| |||||||
| |||||||
1 | computer equipment or enabling software purchased or | ||||||
2 | leased to upgrade, supplement, or replace computer | ||||||
3 | equipment or enabling software purchased or leased in the | ||||||
4 | original investment that would have qualified. | ||||||
5 | The Department of Commerce and Economic Opportunity | ||||||
6 | shall grant a certificate of exemption under this item | ||||||
7 | (44) to qualified data centers as defined by Section | ||||||
8 | 605-1025 of the Department of Commerce and Economic | ||||||
9 | Opportunity Law of the
Civil Administrative Code of | ||||||
10 | Illinois. | ||||||
11 | For the purposes of this item (44): | ||||||
12 | "Data center" means a building or a series of | ||||||
13 | buildings rehabilitated or constructed to house | ||||||
14 | working servers in one physical location or multiple | ||||||
15 | sites within the State of Illinois. | ||||||
16 | "Qualified tangible personal property" means: | ||||||
17 | electrical systems and equipment; climate control and | ||||||
18 | chilling equipment and systems; mechanical systems and | ||||||
19 | equipment; monitoring and secure systems; emergency | ||||||
20 | generators; hardware; computers; servers; data storage | ||||||
21 | devices; network connectivity equipment; racks; | ||||||
22 | cabinets; telecommunications cabling infrastructure; | ||||||
23 | raised floor systems; peripheral components or | ||||||
24 | systems; software; mechanical, electrical, or plumbing | ||||||
25 | systems; battery systems; cooling systems and towers; | ||||||
26 | temperature control systems; other cabling; and other |
| |||||||
| |||||||
1 | data center infrastructure equipment and systems | ||||||
2 | necessary to operate qualified tangible personal | ||||||
3 | property, including fixtures; and component parts of | ||||||
4 | any of the foregoing, including installation, | ||||||
5 | maintenance, repair, refurbishment, and replacement of | ||||||
6 | qualified tangible personal property to generate, | ||||||
7 | transform, transmit, distribute, or manage electricity | ||||||
8 | necessary to operate qualified tangible personal | ||||||
9 | property; and all other tangible personal property | ||||||
10 | that is essential to the operations of a computer data | ||||||
11 | center. The term "qualified tangible personal | ||||||
12 | property" also includes building materials physically | ||||||
13 | incorporated into in to the qualifying data center. To | ||||||
14 | document the exemption allowed under this Section, the | ||||||
15 | retailer must obtain from the purchaser a copy of the | ||||||
16 | certificate of eligibility issued by the Department of | ||||||
17 | Commerce and Economic Opportunity. | ||||||
18 | This item (44) is exempt from the provisions of | ||||||
19 | Section 2-70. | ||||||
20 | (45) Beginning January 1, 2020 and through December | ||||||
21 | 31, 2020, sales of tangible personal property made by a | ||||||
22 | marketplace seller over a marketplace for which tax is due | ||||||
23 | under this Act but for which use tax has been collected and | ||||||
24 | remitted to the Department by a marketplace facilitator | ||||||
25 | under Section 2d of the Use Tax Act are exempt from tax | ||||||
26 | under this Act. A marketplace seller claiming this |
| |||||||
| |||||||
1 | exemption shall maintain books and records demonstrating | ||||||
2 | that the use tax on such sales has been collected and | ||||||
3 | remitted by a marketplace facilitator. Marketplace sellers | ||||||
4 | that have properly remitted tax under this Act on such | ||||||
5 | sales may file a claim for credit as provided in Section 6 | ||||||
6 | of this Act. No claim is allowed, however, for such taxes | ||||||
7 | for which a credit or refund has been issued to the | ||||||
8 | marketplace facilitator under the Use Tax Act, or for | ||||||
9 | which the marketplace facilitator has filed a claim for | ||||||
10 | credit or refund under the Use Tax Act. | ||||||
11 | (46) Beginning on the earlier of: (i) January 1, 2025; | ||||||
12 | or (ii) January 1 of the calendar year immediately | ||||||
13 | following the calendar year in which the State reports to | ||||||
14 | the United States Department of the Treasury that all | ||||||
15 | federal funds received under the American Rescue Plan Act | ||||||
16 | of 2021 have been fully expended, and continuing through | ||||||
17 | December 31 of the fifth calendar year to occur after the | ||||||
18 | earlier of: (i) January 1, 2025; or (ii) January 1 of the | ||||||
19 | calendar year immediately following the calendar year in | ||||||
20 | which the State reports to the United States Department of | ||||||
21 | the Treasury that all federal funds received under the | ||||||
22 | American Rescue Plan Act of 2021 have been fully expended, | ||||||
23 | equipment and material deployed after January 1, 2023 in a | ||||||
24 | county in the State with a population of fewer than 40,000 | ||||||
25 | people or a township in the State with a population | ||||||
26 | density of less than 50 households per square mile in a |
| |||||||
| |||||||
1 | county with a population of less than 300,000 people | ||||||
2 | during that year that is incorporated into or used in the | ||||||
3 | business of providing broadband services, including all | ||||||
4 | equipment and material, machinery, software, or other | ||||||
5 | tangible personal property that is used in whole or in | ||||||
6 | part in producing, broadcasting, distributing, sending, | ||||||
7 | receiving, storing, transmitting, retransmitting, | ||||||
8 | amplifying, switching, or routing broadband services, | ||||||
9 | including the monitoring, testing, maintaining, enabling, | ||||||
10 | or facilitating of such equipment, machinery, software, or | ||||||
11 | other infrastructure. Such property includes, but is not | ||||||
12 | limited to, wires, cables including fiber optic cables, | ||||||
13 | antennas, poles, switches, routers, amplifiers, | ||||||
14 | rectifiers, repeaters, receivers, multiplexers, | ||||||
15 | duplexers, transmitters, power equipment, backup power | ||||||
16 | equipment, diagnostic equipment, storage devices, modems, | ||||||
17 | and other general central office equipment, such as | ||||||
18 | channel cards, frames, and cabinets. The exemption under | ||||||
19 | this item (46) may be taken for property placed in service | ||||||
20 | on or after January 1, 2023; however, the credit may not be | ||||||
21 | taken until a taxable year beginning on or after the | ||||||
22 | earlier of: (i) January 1, 2025; or (ii) January 1 of the | ||||||
23 | calendar year immediately following the calendar year in | ||||||
24 | which the State reports to the United States Department of | ||||||
25 | the Treasury that all federal funds received under the | ||||||
26 | American Rescue Plan Act of 2021 have been fully expended. |
| |||||||
| |||||||
1 | (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19; | ||||||
2 | 101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff. | ||||||
3 | 8-27-21; revised 11-9-21.)
| ||||||
4 | Section 99. Effective date. This Act takes effect upon | ||||||
5 | becoming law.".
|