Bill Text: IL HB4494 | 2017-2018 | 100th General Assembly | Introduced

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Bill Title: Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, from August 5, 2018 through August 11, 2018, the tax imposed under the Acts on clothing and school supplies shall be at the rate of 1.25% (instead of 6.25%). Makes changes concerning the distribution of proceeds from those sales. Makes corresponding changes in the State Finance Act. Effective immediately.

Spectrum: Partisan Bill (Democrat 9-0)

Status: (Failed) 2019-01-08 - Session Sine Die [HB4494 Detail]

Download: Illinois-2017-HB4494-Introduced.html

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100TH GENERAL ASSEMBLY State of Illinois 2017 and 2018 HB4494 Introduced , by Rep. Luis Arroyo SYNOPSIS AS INTRODUCED:
30 ILCS 105/6z-18 from Ch. 127, par. 142z-18
30 ILCS 105/6z-20 from Ch. 127, par. 142z-20
35 ILCS 105/3-6
35 ILCS 105/3-10
35 ILCS 105/9 from Ch. 120, par. 439.9
35 ILCS 120/2-8
35 ILCS 120/2-10
35 ILCS 120/3 from Ch. 120, par. 442
Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, from August 5, 2018 through August 11, 2018, the tax imposed under the Acts on clothing and school supplies shall be at the rate of 1.25% (instead of 6.25%). Makes changes concerning the distribution of proceeds from those sales. Makes corresponding changes in the State Finance Act. Effective immediately.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
HB4494 LRB100 13618 HLH 28242 b
AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The State Finance Act is amended by changing
Sections 6z-18 and 6z-20 as follows:
(30 ILCS 105/6z-18) (from Ch. 127, par. 142z-18)
Sec. 6z-18. A portion of the money paid into the Local
Government Tax Fund from sales of food for human consumption
which is to be consumed off the premises where it is sold
(other than alcoholic beverages, soft drinks and food which has
been prepared for immediate consumption) and prescription and
nonprescription medicines, drugs, medical appliances and
insulin, urine testing materials, syringes and needles used by
diabetics, which occurred in municipalities, shall be
distributed to each municipality based upon the sales which
occurred in that municipality. The remainder shall be
distributed to each county based upon the sales which occurred
in the unincorporated area of that county.
A portion of the money paid into the Local Government Tax
Fund from the 6.25% general use tax rate on the selling price
of tangible personal property which is purchased outside
Illinois at retail from a retailer and which is titled or
registered by any agency of this State's government shall be

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distributed to municipalities as provided in this paragraph.
Each municipality shall receive the amount attributable to
sales for which Illinois addresses for titling or registration
purposes are given as being in such municipality. The remainder
of the money paid into the Local Government Tax Fund from such
sales shall be distributed to counties. Each county shall
receive the amount attributable to sales for which Illinois
addresses for titling or registration purposes are given as
being located in the unincorporated area of such county.
A portion of the money paid into the Local Government Tax
Fund from the 6.25% general rate (and, beginning July 1, 2000
and through December 31, 2000, the 1.25% rate on motor fuel and
gasohol, and from beginning on August 6, 2010 through August
15, 2010, the 1.25% rate on sales tax holiday items, and from
August 5, 2018 through August 11, 2018, the 1.25% rate on sales
tax holiday items) on sales subject to taxation under the
Retailers' Occupation Tax Act and the Service Occupation Tax
Act, which occurred in municipalities, shall be distributed to
each municipality, based upon the sales which occurred in that
municipality. The remainder shall be distributed to each
county, based upon the sales which occurred in the
unincorporated area of such county.
For the purpose of determining allocation to the local
government unit, a retail sale by a producer of coal or other
mineral mined in Illinois is a sale at retail at the place
where the coal or other mineral mined in Illinois is extracted

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from the earth. This paragraph does not apply to coal or other
mineral when it is delivered or shipped by the seller to the
purchaser at a point outside Illinois so that the sale is
exempt under the United States Constitution as a sale in
interstate or foreign commerce.
Whenever the Department determines that a refund of money
paid into the Local Government Tax Fund should be made to a
claimant instead of issuing a credit memorandum, the Department
shall notify the State Comptroller, who shall cause the order
to be drawn for the amount specified, and to the person named,
in such notification from the Department. Such refund shall be
paid by the State Treasurer out of the Local Government Tax
Fund.
As soon as possible after the first day of each month,
beginning January 1, 2011, upon certification of the Department
of Revenue, the Comptroller shall order transferred, and the
Treasurer shall transfer, to the STAR Bonds Revenue Fund the
local sales tax increment, as defined in the Innovation
Development and Economy Act, collected during the second
preceding calendar month for sales within a STAR bond district
and deposited into the Local Government Tax Fund, less 3% of
that amount, which shall be transferred into the Tax Compliance
and Administration Fund and shall be used by the Department,
subject to appropriation, to cover the costs of the Department
in administering the Innovation Development and Economy Act.
After the monthly transfer to the STAR Bonds Revenue Fund,

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on or before the 25th day of each calendar month, the
Department shall prepare and certify to the Comptroller the
disbursement of stated sums of money to named municipalities
and counties, the municipalities and counties to be those
entitled to distribution of taxes or penalties paid to the
Department during the second preceding calendar month. The
amount to be paid to each municipality or county shall be the
amount (not including credit memoranda) collected during the
second preceding calendar month by the Department and paid into
the Local Government Tax Fund, plus an amount the Department
determines is necessary to offset any amounts which were
erroneously paid to a different taxing body, and not including
an amount equal to the amount of refunds made during the second
preceding calendar month by the Department, and not including
any amount which the Department determines is necessary to
offset any amounts which are payable to a different taxing body
but were erroneously paid to the municipality or county, and
not including any amounts that are transferred to the STAR
Bonds Revenue Fund. Within 10 days after receipt, by the
Comptroller, of the disbursement certification to the
municipalities and counties, provided for in this Section to be
given to the Comptroller by the Department, the Comptroller
shall cause the orders to be drawn for the respective amounts
in accordance with the directions contained in such
certification.
When certifying the amount of monthly disbursement to a

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municipality or county under this Section, the Department shall
increase or decrease that amount by an amount necessary to
offset any misallocation of previous disbursements. The offset
amount shall be the amount erroneously disbursed within the 6
months preceding the time a misallocation is discovered.
The provisions directing the distributions from the
special fund in the State Treasury provided for in this Section
shall constitute an irrevocable and continuing appropriation
of all amounts as provided herein. The State Treasurer and
State Comptroller are hereby authorized to make distributions
as provided in this Section.
In construing any development, redevelopment, annexation,
preannexation or other lawful agreement in effect prior to
September 1, 1990, which describes or refers to receipts from a
county or municipal retailers' occupation tax, use tax or
service occupation tax which now cannot be imposed, such
description or reference shall be deemed to include the
replacement revenue for such abolished taxes, distributed from
the Local Government Tax Fund.
As soon as possible after the effective date of this
amendatory Act of the 98th General Assembly, the State
Comptroller shall order and the State Treasurer shall transfer
$6,600,000 from the Local Government Tax Fund to the Illinois
State Medical Disciplinary Fund.
(Source: P.A. 97-333, eff. 8-12-11; 98-3, eff. 3-8-13.)

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(30 ILCS 105/6z-20) (from Ch. 127, par. 142z-20)
Sec. 6z-20. County and Mass Transit District Fund. Of the
money received from the 6.25% general rate (and, beginning July
1, 2000 and through December 31, 2000, the 1.25% rate on motor
fuel and gasohol, and from beginning on August 6, 2010 through
August 15, 2010, the 1.25% rate on sales tax holiday items, and
from August 5, 2018 through August 11, 2018, the 1.25% rate on
sales tax holiday items) on sales subject to taxation under the
Retailers' Occupation Tax Act and Service Occupation Tax Act
and paid into the County and Mass Transit District Fund,
distribution to the Regional Transportation Authority tax
fund, created pursuant to Section 4.03 of the Regional
Transportation Authority Act, for deposit therein shall be made
based upon the retail sales occurring in a county having more
than 3,000,000 inhabitants. The remainder shall be distributed
to each county having 3,000,000 or fewer inhabitants based upon
the retail sales occurring in each such county.
For the purpose of determining allocation to the local
government unit, a retail sale by a producer of coal or other
mineral mined in Illinois is a sale at retail at the place
where the coal or other mineral mined in Illinois is extracted
from the earth. This paragraph does not apply to coal or other
mineral when it is delivered or shipped by the seller to the
purchaser at a point outside Illinois so that the sale is
exempt under the United States Constitution as a sale in
interstate or foreign commerce.

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Of the money received from the 6.25% general use tax rate
on tangible personal property which is purchased outside
Illinois at retail from a retailer and which is titled or
registered by any agency of this State's government and paid
into the County and Mass Transit District Fund, the amount for
which Illinois addresses for titling or registration purposes
are given as being in each county having more than 3,000,000
inhabitants shall be distributed into the Regional
Transportation Authority tax fund, created pursuant to Section
4.03 of the Regional Transportation Authority Act. The
remainder of the money paid from such sales shall be
distributed to each county based on sales for which Illinois
addresses for titling or registration purposes are given as
being located in the county. Any money paid into the Regional
Transportation Authority Occupation and Use Tax Replacement
Fund from the County and Mass Transit District Fund prior to
January 14, 1991, which has not been paid to the Authority
prior to that date, shall be transferred to the Regional
Transportation Authority tax fund.
Whenever the Department determines that a refund of money
paid into the County and Mass Transit District Fund should be
made to a claimant instead of issuing a credit memorandum, the
Department shall notify the State Comptroller, who shall cause
the order to be drawn for the amount specified, and to the
person named, in such notification from the Department. Such
refund shall be paid by the State Treasurer out of the County

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and Mass Transit District Fund.
As soon as possible after the first day of each month,
beginning January 1, 2011, upon certification of the Department
of Revenue, the Comptroller shall order transferred, and the
Treasurer shall transfer, to the STAR Bonds Revenue Fund the
local sales tax increment, as defined in the Innovation
Development and Economy Act, collected during the second
preceding calendar month for sales within a STAR bond district
and deposited into the County and Mass Transit District Fund,
less 3% of that amount, which shall be transferred into the Tax
Compliance and Administration Fund and shall be used by the
Department, subject to appropriation, to cover the costs of the
Department in administering the Innovation Development and
Economy Act.
After the monthly transfer to the STAR Bonds Revenue Fund,
on or before the 25th day of each calendar month, the
Department shall prepare and certify to the Comptroller the
disbursement of stated sums of money to the Regional
Transportation Authority and to named counties, the counties to
be those entitled to distribution, as hereinabove provided, of
taxes or penalties paid to the Department during the second
preceding calendar month. The amount to be paid to the Regional
Transportation Authority and each county having 3,000,000 or
fewer inhabitants shall be the amount (not including credit
memoranda) collected during the second preceding calendar
month by the Department and paid into the County and Mass

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Transit District Fund, plus an amount the Department determines
is necessary to offset any amounts which were erroneously paid
to a different taxing body, and not including an amount equal
to the amount of refunds made during the second preceding
calendar month by the Department, and not including any amount
which the Department determines is necessary to offset any
amounts which were payable to a different taxing body but were
erroneously paid to the Regional Transportation Authority or
county, and not including any amounts that are transferred to
the STAR Bonds Revenue Fund, less 2% of the amount to be paid
to the Regional Transportation Authority, which shall be
transferred into the Tax Compliance and Administration Fund.
The Department, at the time of each monthly disbursement to the
Regional Transportation Authority, shall prepare and certify
to the State Comptroller the amount to be transferred into the
Tax Compliance and Administration Fund under this Section.
Within 10 days after receipt, by the Comptroller, of the
disbursement certification to the Regional Transportation
Authority, counties, and the Tax Compliance and Administration
Fund provided for in this Section to be given to the
Comptroller by the Department, the Comptroller shall cause the
orders to be drawn for the respective amounts in accordance
with the directions contained in such certification.
When certifying the amount of a monthly disbursement to the
Regional Transportation Authority or to a county under this
Section, the Department shall increase or decrease that amount

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by an amount necessary to offset any misallocation of previous
disbursements. The offset amount shall be the amount
erroneously disbursed within the 6 months preceding the time a
misallocation is discovered.
The provisions directing the distributions from the
special fund in the State Treasury provided for in this Section
and from the Regional Transportation Authority tax fund created
by Section 4.03 of the Regional Transportation Authority Act
shall constitute an irrevocable and continuing appropriation
of all amounts as provided herein. The State Treasurer and
State Comptroller are hereby authorized to make distributions
as provided in this Section.
In construing any development, redevelopment, annexation,
preannexation or other lawful agreement in effect prior to
September 1, 1990, which describes or refers to receipts from a
county or municipal retailers' occupation tax, use tax or
service occupation tax which now cannot be imposed, such
description or reference shall be deemed to include the
replacement revenue for such abolished taxes, distributed from
the County and Mass Transit District Fund or Local Government
Distributive Fund, as the case may be.
(Source: P.A. 100-23, eff. 7-6-17.)
Section 10. The Use Tax Act is amended by changing Sections
3-6, 3-10, and 9 as follows:

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(35 ILCS 105/3-6)
Sec. 3-6. Sales tax holiday items.
(a) The tangible personal property described in this
subsection qualifies for the 1.25% reduced rate of tax during
for the period set forth in Section 3-10 of this Act
(hereinafter referred to as the Sales Tax Holiday Period). The
reduced rate on these items shall be administered under the
provisions of subsection (b) of this Section. The following
items are subject to the reduced rate:
(1) Clothing items that each have a retail selling
price of less than $100.
"Clothing" means, unless otherwise specified in this
Section, all human wearing apparel suitable for general
use. "Clothing" does not include clothing accessories,
protective equipment, or sport or recreational equipment.
"Clothing" includes, but is not limited to: household and
shop aprons; athletic supporters; bathing suits and caps;
belts and suspenders; boots; coats and jackets; ear muffs;
footlets; gloves and mittens for general use; hats and
caps; hosiery; insoles for shoes; lab coats; neckties;
overshoes; pantyhose; rainwear; rubber pants; sandals;
scarves; shoes and shoelaces; slippers; sneakers; socks
and stockings; steel-toed shoes; underwear; and school
uniforms.
"Clothing accessories" means, but is not limited to:
briefcases; cosmetics; hair notions, including, but not

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limited to barrettes, hair bows, and hair nets; handbags;
handkerchiefs; jewelry; non-prescription sunglasses;
umbrellas; wallets; watches; and wigs and hair pieces.
"Protective equipment" means, but is not limited to:
breathing masks; clean room apparel and equipment; ear and
hearing protectors; face shields; hard hats; helmets;
paint or dust respirators; protective gloves; safety
glasses and goggles; safety belts; tool belts; and welder's
gloves and masks.
"Sport or recreational equipment" means, but is not
limited to: ballet and tap shoes; cleated or spiked
athletic shoes; gloves, including, but not limited to,
baseball, bowling, boxing, hockey, and golf gloves;
goggles; hand and elbow guards; life preservers and vests;
mouth guards; roller and ice skates; shin guards; shoulder
pads; ski boots; waders; and wetsuits and fins.
(2) School supplies. "School supplies" means, unless
otherwise specified in this Section, items used by a
student in a course of study. The purchase of school
supplies for use by persons other than students for use in
a course of study are not eligible for the reduced rate of
tax. "School supplies" do not include school art supplies;
school instructional materials; cameras; film and memory
cards; videocameras, tapes, and videotapes; computers;
cell phones; Personal Digital Assistants (PDAs); handheld
electronic schedulers; and school computer supplies.

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"School supplies" includes, but is not limited to:
binders; book bags; calculators; cellophane tape;
blackboard chalk; compasses; composition books; crayons;
erasers; expandable, pocket, plastic, and manila folders;
glue, paste, and paste sticks; highlighters; index cards;
index card boxes; legal pads; lunch boxes; markers;
notebooks; paper, including loose leaf ruled notebook
paper, copy paper, graph paper, tracing paper, manila
paper, colored paper, poster board, and construction
paper; pencils; pencil leads; pens; ink and ink refills for
pens; pencil boxes and other school supply boxes; pencil
sharpeners; protractors; rulers; scissors; and writing
tablets.
"School art supply" means an item commonly used by a
student in a course of study for artwork and includes only
the following items: clay and glazes; acrylic, tempera, and
oil paint; paintbrushes for artwork; sketch and drawing
pads; and watercolors.
"School instructional material" means written material
commonly used by a student in a course of study as a
reference and to learn the subject being taught and
includes only the following items: reference books;
reference maps and globes; textbooks; and workbooks.
"School computer supply" means an item commonly used by
a student in a course of study in which a computer is used
and applies only to the following items: flashdrives and

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other computer data storage devices; data storage media,
such as diskettes and compact disks; boxes and cases for
disk storage; external ports or drives; computer cases;
computer cables; computer printers; and printer
cartridges, toner, and ink.
(b) Administration. Notwithstanding any other provision of
this Act, the reduced rate of tax under Section 3-10 of this
Act for clothing and school supplies shall be administered by
the Department under the provisions of this subsection (b).
(1) Bundled sales. Items that qualify for the reduced
rate of tax that are bundled together with items that do
not qualify for the reduced rate of tax and that are sold
for one itemized price will be subject to the reduced rate
of tax only if the value of the items that qualify for the
reduced rate of tax exceeds the value of the items that do
not qualify for the reduced rate of tax.
(2) Coupons and discounts. An unreimbursed discount by
the seller reduces the sales price of the property so that
the discounted sales price determines whether the sales
price is within a sales tax holiday price threshold. A
coupon or other reduction in the sales price is treated as
a discount if the seller is not reimbursed for the coupon
or reduction amount by a third party.
(3) Splitting of items normally sold together.
Articles that are normally sold as a single unit must
continue to be sold in that manner. Such articles cannot be

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priced separately and sold as individual items in order to
obtain the reduced rate of tax. For example, a pair of
shoes cannot have each shoe sold separately so that the
sales price of each shoe is within a sales tax holiday
price threshold.
(4) Rain checks. A rain check is a procedure that
allows a customer to purchase an item at a certain price at
a later time because the particular item was out of stock.
Eligible property that customers purchase during the Sales
Tax Holiday Period with the use of a rain check will
qualify for the reduced rate of tax regardless of when the
rain check was issued. Issuance of a rain check during the
Sales Tax Holiday Period will not qualify eligible property
for the reduced rate of tax if the property is actually
purchased after the Sales Tax Holiday Period.
(5) Exchanges. The procedure for an exchange in regards
to a sales tax holiday is as follows:
(A) If a customer purchases an item of eligible
property during the Sales Tax Holiday Period, but later
exchanges the item for a similar eligible item, even if
a different size, different color, or other feature, no
additional tax is due even if the exchange is made
after the Sales Tax Holiday Period.
(B) If a customer purchases an item of eligible
property during the Sales Tax Holiday Period, but after
the Sales Tax Holiday Period has ended, the customer

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returns the item and receives credit on the purchase of
a different item, the 6.25% general merchandise sales
tax rate is due on the sale of the newly purchased
item.
(C) If a customer purchases an item of eligible
property before the Sales Tax Holiday Period, but
during the Sales Tax Holiday Period the customer
returns the item and receives credit on the purchase of
a different item of eligible property, the reduced rate
of tax is due on the sale of the new item if the new
item is purchased during the Sales Tax Holiday Period.
(6) Delivery charges. Delivery charges, including
shipping, handling and service charges, are part of the
sales price of eligible property.
(7) Order date and back orders. For the purpose of a
sales tax holiday, eligible property qualifies for the
reduced rate of tax if: (i) the item is both delivered to
and paid for by the customer during the Sales Tax Holiday
Period or (ii) the customer orders and pays for the item
and the seller accepts the order during the Sales Tax
Holiday Period for immediate shipment, even if delivery is
made after the Sales Tax Holiday Period. The seller accepts
an order when the seller has taken action to fill the order
for immediate shipment. Actions to fill an order include
placement of an "in date" stamp on an order or assignment
of an "order number" to an order within the Sales Tax

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Holiday Period. An order is for immediate shipment when the
customer does not request delayed shipment. An order is for
immediate shipment notwithstanding that the shipment may
be delayed because of a backlog of orders or because stock
is currently unavailable to, or on back order by, the
seller.
(8) Returns. For a 60-day period immediately after the
Sales Tax Holiday Period, if a customer returns an item
that would qualify for the reduced rate of tax, credit for
or refund of sales tax shall be given only at the reduced
rate unless the customer provides a receipt or invoice that
shows tax was paid at the 6.25% general merchandise rate,
or the seller has sufficient documentation to show that tax
was paid at the 6.25% general merchandise rate on the
specific item. This 60-day period is set solely for the
purpose of designating a time period during which the
customer must provide documentation that shows that the
appropriate sales tax rate was paid on returned
merchandise. The 60-day period is not intended to change a
seller's policy on the time period during which the seller
will accept returns.
(c) The Department may implement the provisions of this
Section through the use of emergency rules, along with
permanent rules filed concurrently with such emergency rules,
in accordance with the provisions of Section 5-45 of the
Illinois Administrative Procedure Act. For purposes of the

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Illinois Administrative Procedure Act, the adoption of rules to
implement the provisions of this Section shall be deemed an
emergency and necessary for the public interest, safety, and
welfare.
(d) As used in this Act, "Sales Tax Holiday Period" means
the period beginning on August 6, 2010 and ending on August 15,
2010 and the period beginning on August 5, 2018 and ending on
August 11, 2018.
(Source: P.A. 96-1012, eff. 7-7-10.)
(35 ILCS 105/3-10)
Sec. 3-10. Rate of tax. Unless otherwise provided in this
Section, the tax imposed by this Act is at the rate of 6.25% of
either the selling price or the fair market value, if any, of
the tangible personal property. In all cases where property
functionally used or consumed is the same as the property that
was purchased at retail, then the tax is imposed on the selling
price of the property. In all cases where property functionally
used or consumed is a by-product or waste product that has been
refined, manufactured, or produced from property purchased at
retail, then the tax is imposed on the lower of the fair market
value, if any, of the specific property so used in this State
or on the selling price of the property purchased at retail.
For purposes of this Section "fair market value" means the
price at which property would change hands between a willing
buyer and a willing seller, neither being under any compulsion

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to buy or sell and both having reasonable knowledge of the
relevant facts. The fair market value shall be established by
Illinois sales by the taxpayer of the same property as that
functionally used or consumed, or if there are no such sales by
the taxpayer, then comparable sales or purchases of property of
like kind and character in Illinois.
Beginning on July 1, 2000 and through December 31, 2000,
with respect to motor fuel, as defined in Section 1.1 of the
Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
the Use Tax Act, the tax is imposed at the rate of 1.25%.
During the Sales Tax Holiday Period, as defined in Section
3-6 of this Act Beginning on August 6, 2010 through August 15,
2010, with respect to sales tax holiday items as defined in
Section 3-6 of this Act, the tax is imposed at the rate of
1.25%.
With respect to gasohol, the tax imposed by this Act
applies to (i) 70% of the proceeds of sales made on or after
January 1, 1990, and before July 1, 2003, (ii) 80% of the
proceeds of sales made on or after July 1, 2003 and on or
before July 1, 2017, and (iii) 100% of the proceeds of sales
made thereafter. If, at any time, however, the tax under this
Act on sales of gasohol is imposed at the rate of 1.25%, then
the tax imposed by this Act applies to 100% of the proceeds of
sales of gasohol made during that time.
With respect to majority blended ethanol fuel, the tax
imposed by this Act does not apply to the proceeds of sales

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made on or after July 1, 2003 and on or before December 31,
2023 but applies to 100% of the proceeds of sales made
thereafter.
With respect to biodiesel blends with no less than 1% and
no more than 10% biodiesel, the tax imposed by this Act applies
to (i) 80% of the proceeds of sales made on or after July 1,
2003 and on or before December 31, 2018 and (ii) 100% of the
proceeds of sales made thereafter. If, at any time, however,
the tax under this Act on sales of biodiesel blends with no
less than 1% and no more than 10% biodiesel is imposed at the
rate of 1.25%, then the tax imposed by this Act applies to 100%
of the proceeds of sales of biodiesel blends with no less than
1% and no more than 10% biodiesel made during that time.
With respect to 100% biodiesel and biodiesel blends with
more than 10% but no more than 99% biodiesel, the tax imposed
by this Act does not apply to the proceeds of sales made on or
after July 1, 2003 and on or before December 31, 2023 but
applies to 100% of the proceeds of sales made thereafter.
With respect to food for human consumption that is to be
consumed off the premises where it is sold (other than
alcoholic beverages, soft drinks, and food that has been
prepared for immediate consumption) and prescription and
nonprescription medicines, drugs, medical appliances, products
classified as Class III medical devices by the United States
Food and Drug Administration that are used for cancer treatment
pursuant to a prescription, as well as any accessories and

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components related to those devices, modifications to a motor
vehicle for the purpose of rendering it usable by a person with
a disability, and insulin, urine testing materials, syringes,
and needles used by diabetics, for human use, the tax is
imposed at the rate of 1%. For the purposes of this Section,
until September 1, 2009: the term "soft drinks" means any
complete, finished, ready-to-use, non-alcoholic drink, whether
carbonated or not, including but not limited to soda water,
cola, fruit juice, vegetable juice, carbonated water, and all
other preparations commonly known as soft drinks of whatever
kind or description that are contained in any closed or sealed
bottle, can, carton, or container, regardless of size; but
"soft drinks" does not include coffee, tea, non-carbonated
water, infant formula, milk or milk products as defined in the
Grade A Pasteurized Milk and Milk Products Act, or drinks
containing 50% or more natural fruit or vegetable juice.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "soft drinks" means non-alcoholic
beverages that contain natural or artificial sweeteners. "Soft
drinks" do not include beverages that contain milk or milk
products, soy, rice or similar milk substitutes, or greater
than 50% of vegetable or fruit juice by volume.
Until August 1, 2009, and notwithstanding any other
provisions of this Act, "food for human consumption that is to
be consumed off the premises where it is sold" includes all
food sold through a vending machine, except soft drinks and

HB4494 - 22 - LRB100 13618 HLH 28242 b
food products that are dispensed hot from a vending machine,
regardless of the location of the vending machine. Beginning
August 1, 2009, and notwithstanding any other provisions of
this Act, "food for human consumption that is to be consumed
off the premises where it is sold" includes all food sold
through a vending machine, except soft drinks, candy, and food
products that are dispensed hot from a vending machine,
regardless of the location of the vending machine.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "food for human consumption that
is to be consumed off the premises where it is sold" does not
include candy. For purposes of this Section, "candy" means a
preparation of sugar, honey, or other natural or artificial
sweeteners in combination with chocolate, fruits, nuts or other
ingredients or flavorings in the form of bars, drops, or
pieces. "Candy" does not include any preparation that contains
flour or requires refrigeration.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "nonprescription medicines and
drugs" does not include grooming and hygiene products. For
purposes of this Section, "grooming and hygiene products"
includes, but is not limited to, soaps and cleaning solutions,
shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
lotions and screens, unless those products are available by
prescription only, regardless of whether the products meet the
definition of "over-the-counter-drugs". For the purposes of

HB4494 - 23 - LRB100 13618 HLH 28242 b
this paragraph, "over-the-counter-drug" means a drug for human
use that contains a label that identifies the product as a drug
as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
label includes:
(A) A "Drug Facts" panel; or
(B) A statement of the "active ingredient(s)" with a
list of those ingredients contained in the compound,
substance or preparation.
Beginning on the effective date of this amendatory Act of
the 98th General Assembly, "prescription and nonprescription
medicines and drugs" includes medical cannabis purchased from a
registered dispensing organization under the Compassionate Use
of Medical Cannabis Pilot Program Act.
If the property that is purchased at retail from a retailer
is acquired outside Illinois and used outside Illinois before
being brought to Illinois for use here and is taxable under
this Act, the "selling price" on which the tax is computed
shall be reduced by an amount that represents a reasonable
allowance for depreciation for the period of prior out-of-state
use.
(Source: P.A. 99-143, eff. 7-27-15; 99-858, eff. 8-19-16;
100-22, eff. 7-6-17.)
(35 ILCS 105/9) (from Ch. 120, par. 439.9)
Sec. 9. Except as to motor vehicles, watercraft, aircraft,
and trailers that are required to be registered with an agency

HB4494 - 24 - LRB100 13618 HLH 28242 b
of this State, each retailer required or authorized to collect
the tax imposed by this Act shall pay to the Department the
amount of such tax (except as otherwise provided) at the time
when he is required to file his return for the period during
which such tax was collected, less a discount of 2.1% prior to
January 1, 1990, and 1.75% on and after January 1, 1990, or $5
per calendar year, whichever is greater, which is allowed to
reimburse the retailer for expenses incurred in collecting the
tax, keeping records, preparing and filing returns, remitting
the tax and supplying data to the Department on request. In the
case of retailers who report and pay the tax on a transaction
by transaction basis, as provided in this Section, such
discount shall be taken with each such tax remittance instead
of when such retailer files his periodic return. The Department
may disallow the discount for retailers whose certificate of
registration is revoked at the time the return is filed, but
only if the Department's decision to revoke the certificate of
registration has become final. A retailer need not remit that
part of any tax collected by him to the extent that he is
required to remit and does remit the tax imposed by the
Retailers' Occupation Tax Act, with respect to the sale of the
same property.
Where such tangible personal property is sold under a
conditional sales contract, or under any other form of sale
wherein the payment of the principal sum, or a part thereof, is
extended beyond the close of the period for which the return is

HB4494 - 25 - LRB100 13618 HLH 28242 b
filed, the retailer, in collecting the tax (except as to motor
vehicles, watercraft, aircraft, and trailers that are required
to be registered with an agency of this State), may collect for
each tax return period, only the tax applicable to that part of
the selling price actually received during such tax return
period.
Except as provided in this Section, on or before the
twentieth day of each calendar month, such retailer shall file
a return for the preceding calendar month. Such return shall be
filed on forms prescribed by the Department and shall furnish
such information as the Department may reasonably require.
The Department may require returns to be filed on a
quarterly basis. If so required, a return for each calendar
quarter shall be filed on or before the twentieth day of the
calendar month following the end of such calendar quarter. The
taxpayer shall also file a return with the Department for each
of the first two months of each calendar quarter, on or before
the twentieth day of the following calendar month, stating:
1. The name of the seller;
2. The address of the principal place of business from
which he engages in the business of selling tangible
personal property at retail in this State;
3. The total amount of taxable receipts received by him
during the preceding calendar month from sales of tangible
personal property by him during such preceding calendar
month, including receipts from charge and time sales, but

HB4494 - 26 - LRB100 13618 HLH 28242 b
less all deductions allowed by law;
4. The amount of credit provided in Section 2d of this
Act;
5. The amount of tax due;
5-5. The signature of the taxpayer; and
6. Such other reasonable information as the Department
may require.
If a taxpayer fails to sign a return within 30 days after
the proper notice and demand for signature by the Department,
the return shall be considered valid and any amount shown to be
due on the return shall be deemed assessed.
Beginning October 1, 1993, a taxpayer who has an average
monthly tax liability of $150,000 or more shall make all
payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 1994, a taxpayer who has
an average monthly tax liability of $100,000 or more shall make
all payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 1995, a taxpayer who has
an average monthly tax liability of $50,000 or more shall make
all payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 2000, a taxpayer who has
an annual tax liability of $200,000 or more shall make all
payments required by rules of the Department by electronic
funds transfer. The term "annual tax liability" shall be the
sum of the taxpayer's liabilities under this Act, and under all
other State and local occupation and use tax laws administered

HB4494 - 27 - LRB100 13618 HLH 28242 b
by the Department, for the immediately preceding calendar year.
The term "average monthly tax liability" means the sum of the
taxpayer's liabilities under this Act, and under all other
State and local occupation and use tax laws administered by the
Department, for the immediately preceding calendar year
divided by 12. Beginning on October 1, 2002, a taxpayer who has
a tax liability in the amount set forth in subsection (b) of
Section 2505-210 of the Department of Revenue Law shall make
all payments required by rules of the Department by electronic
funds transfer.
Before August 1 of each year beginning in 1993, the
Department shall notify all taxpayers required to make payments
by electronic funds transfer. All taxpayers required to make
payments by electronic funds transfer shall make those payments
for a minimum of one year beginning on October 1.
Any taxpayer not required to make payments by electronic
funds transfer may make payments by electronic funds transfer
with the permission of the Department.
All taxpayers required to make payment by electronic funds
transfer and any taxpayers authorized to voluntarily make
payments by electronic funds transfer shall make those payments
in the manner authorized by the Department.
The Department shall adopt such rules as are necessary to
effectuate a program of electronic funds transfer and the
requirements of this Section.
Before October 1, 2000, if the taxpayer's average monthly

HB4494 - 28 - LRB100 13618 HLH 28242 b
tax liability to the Department under this Act, the Retailers'
Occupation Tax Act, the Service Occupation Tax Act, the Service
Use Tax Act was $10,000 or more during the preceding 4 complete
calendar quarters, he shall file a return with the Department
each month by the 20th day of the month next following the
month during which such tax liability is incurred and shall
make payments to the Department on or before the 7th, 15th,
22nd and last day of the month during which such liability is
incurred. On and after October 1, 2000, if the taxpayer's
average monthly tax liability to the Department under this Act,
the Retailers' Occupation Tax Act, the Service Occupation Tax
Act, and the Service Use Tax Act was $20,000 or more during the
preceding 4 complete calendar quarters, he shall file a return
with the Department each month by the 20th day of the month
next following the month during which such tax liability is
incurred and shall make payment to the Department on or before
the 7th, 15th, 22nd and last day of the month during which such
liability is incurred. If the month during which such tax
liability is incurred began prior to January 1, 1985, each
payment shall be in an amount equal to 1/4 of the taxpayer's
actual liability for the month or an amount set by the
Department not to exceed 1/4 of the average monthly liability
of the taxpayer to the Department for the preceding 4 complete
calendar quarters (excluding the month of highest liability and
the month of lowest liability in such 4 quarter period). If the
month during which such tax liability is incurred begins on or

HB4494 - 29 - LRB100 13618 HLH 28242 b
after January 1, 1985, and prior to January 1, 1987, each
payment shall be in an amount equal to 22.5% of the taxpayer's
actual liability for the month or 27.5% of the taxpayer's
liability for the same calendar month of the preceding year. If
the month during which such tax liability is incurred begins on
or after January 1, 1987, and prior to January 1, 1988, each
payment shall be in an amount equal to 22.5% of the taxpayer's
actual liability for the month or 26.25% of the taxpayer's
liability for the same calendar month of the preceding year. If
the month during which such tax liability is incurred begins on
or after January 1, 1988, and prior to January 1, 1989, or
begins on or after January 1, 1996, each payment shall be in an
amount equal to 22.5% of the taxpayer's actual liability for
the month or 25% of the taxpayer's liability for the same
calendar month of the preceding year. If the month during which
such tax liability is incurred begins on or after January 1,
1989, and prior to January 1, 1996, each payment shall be in an
amount equal to 22.5% of the taxpayer's actual liability for
the month or 25% of the taxpayer's liability for the same
calendar month of the preceding year or 100% of the taxpayer's
actual liability for the quarter monthly reporting period. The
amount of such quarter monthly payments shall be credited
against the final tax liability of the taxpayer's return for
that month. Before October 1, 2000, once applicable, the
requirement of the making of quarter monthly payments to the
Department shall continue until such taxpayer's average

HB4494 - 30 - LRB100 13618 HLH 28242 b
monthly liability to the Department during the preceding 4
complete calendar quarters (excluding the month of highest
liability and the month of lowest liability) is less than
$9,000, or until such taxpayer's average monthly liability to
the Department as computed for each calendar quarter of the 4
preceding complete calendar quarter period is less than
$10,000. However, if a taxpayer can show the Department that a
substantial change in the taxpayer's business has occurred
which causes the taxpayer to anticipate that his average
monthly tax liability for the reasonably foreseeable future
will fall below the $10,000 threshold stated above, then such
taxpayer may petition the Department for change in such
taxpayer's reporting status. On and after October 1, 2000, once
applicable, the requirement of the making of quarter monthly
payments to the Department shall continue until such taxpayer's
average monthly liability to the Department during the
preceding 4 complete calendar quarters (excluding the month of
highest liability and the month of lowest liability) is less
than $19,000 or until such taxpayer's average monthly liability
to the Department as computed for each calendar quarter of the
4 preceding complete calendar quarter period is less than
$20,000. However, if a taxpayer can show the Department that a
substantial change in the taxpayer's business has occurred
which causes the taxpayer to anticipate that his average
monthly tax liability for the reasonably foreseeable future
will fall below the $20,000 threshold stated above, then such

HB4494 - 31 - LRB100 13618 HLH 28242 b
taxpayer may petition the Department for a change in such
taxpayer's reporting status. The Department shall change such
taxpayer's reporting status unless it finds that such change is
seasonal in nature and not likely to be long term. If any such
quarter monthly payment is not paid at the time or in the
amount required by this Section, then the taxpayer shall be
liable for penalties and interest on the difference between the
minimum amount due and the amount of such quarter monthly
payment actually and timely paid, except insofar as the
taxpayer has previously made payments for that month to the
Department in excess of the minimum payments previously due as
provided in this Section. The Department shall make reasonable
rules and regulations to govern the quarter monthly payment
amount and quarter monthly payment dates for taxpayers who file
on other than a calendar monthly basis.
If any such payment provided for in this Section exceeds
the taxpayer's liabilities under this Act, the Retailers'
Occupation Tax Act, the Service Occupation Tax Act and the
Service Use Tax Act, as shown by an original monthly return,
the Department shall issue to the taxpayer a credit memorandum
no later than 30 days after the date of payment, which
memorandum may be submitted by the taxpayer to the Department
in payment of tax liability subsequently to be remitted by the
taxpayer to the Department or be assigned by the taxpayer to a
similar taxpayer under this Act, the Retailers' Occupation Tax
Act, the Service Occupation Tax Act or the Service Use Tax Act,

HB4494 - 32 - LRB100 13618 HLH 28242 b
in accordance with reasonable rules and regulations to be
prescribed by the Department, except that if such excess
payment is shown on an original monthly return and is made
after December 31, 1986, no credit memorandum shall be issued,
unless requested by the taxpayer. If no such request is made,
the taxpayer may credit such excess payment against tax
liability subsequently to be remitted by the taxpayer to the
Department under this Act, the Retailers' Occupation Tax Act,
the Service Occupation Tax Act or the Service Use Tax Act, in
accordance with reasonable rules and regulations prescribed by
the Department. If the Department subsequently determines that
all or any part of the credit taken was not actually due to the
taxpayer, the taxpayer's 2.1% or 1.75% vendor's discount shall
be reduced by 2.1% or 1.75% of the difference between the
credit taken and that actually due, and the taxpayer shall be
liable for penalties and interest on such difference.
If the retailer is otherwise required to file a monthly
return and if the retailer's average monthly tax liability to
the Department does not exceed $200, the Department may
authorize his returns to be filed on a quarter annual basis,
with the return for January, February, and March of a given
year being due by April 20 of such year; with the return for
April, May and June of a given year being due by July 20 of such
year; with the return for July, August and September of a given
year being due by October 20 of such year, and with the return
for October, November and December of a given year being due by

HB4494 - 33 - LRB100 13618 HLH 28242 b
January 20 of the following year.
If the retailer is otherwise required to file a monthly or
quarterly return and if the retailer's average monthly tax
liability to the Department does not exceed $50, the Department
may authorize his returns to be filed on an annual basis, with
the return for a given year being due by January 20 of the
following year.
Such quarter annual and annual returns, as to form and
substance, shall be subject to the same requirements as monthly
returns.
Notwithstanding any other provision in this Act concerning
the time within which a retailer may file his return, in the
case of any retailer who ceases to engage in a kind of business
which makes him responsible for filing returns under this Act,
such retailer shall file a final return under this Act with the
Department not more than one month after discontinuing such
business.
In addition, with respect to motor vehicles, watercraft,
aircraft, and trailers that are required to be registered with
an agency of this State, every retailer selling this kind of
tangible personal property shall file, with the Department,
upon a form to be prescribed and supplied by the Department, a
separate return for each such item of tangible personal
property which the retailer sells, except that if, in the same
transaction, (i) a retailer of aircraft, watercraft, motor
vehicles or trailers transfers more than one aircraft,

HB4494 - 34 - LRB100 13618 HLH 28242 b
watercraft, motor vehicle or trailer to another aircraft,
watercraft, motor vehicle or trailer retailer for the purpose
of resale or (ii) a retailer of aircraft, watercraft, motor
vehicles, or trailers transfers more than one aircraft,
watercraft, motor vehicle, or trailer to a purchaser for use as
a qualifying rolling stock as provided in Section 3-55 of this
Act, then that seller may report the transfer of all the
aircraft, watercraft, motor vehicles or trailers involved in
that transaction to the Department on the same uniform
invoice-transaction reporting return form. For purposes of
this Section, "watercraft" means a Class 2, Class 3, or Class 4
watercraft as defined in Section 3-2 of the Boat Registration
and Safety Act, a personal watercraft, or any boat equipped
with an inboard motor.
The transaction reporting return in the case of motor
vehicles or trailers that are required to be registered with an
agency of this State, shall be the same document as the Uniform
Invoice referred to in Section 5-402 of the Illinois Vehicle
Code and must show the name and address of the seller; the name
and address of the purchaser; the amount of the selling price
including the amount allowed by the retailer for traded-in
property, if any; the amount allowed by the retailer for the
traded-in tangible personal property, if any, to the extent to
which Section 2 of this Act allows an exemption for the value
of traded-in property; the balance payable after deducting such
trade-in allowance from the total selling price; the amount of

HB4494 - 35 - LRB100 13618 HLH 28242 b
tax due from the retailer with respect to such transaction; the
amount of tax collected from the purchaser by the retailer on
such transaction (or satisfactory evidence that such tax is not
due in that particular instance, if that is claimed to be the
fact); the place and date of the sale; a sufficient
identification of the property sold; such other information as
is required in Section 5-402 of the Illinois Vehicle Code, and
such other information as the Department may reasonably
require.
The transaction reporting return in the case of watercraft
and aircraft must show the name and address of the seller; the
name and address of the purchaser; the amount of the selling
price including the amount allowed by the retailer for
traded-in property, if any; the amount allowed by the retailer
for the traded-in tangible personal property, if any, to the
extent to which Section 2 of this Act allows an exemption for
the value of traded-in property; the balance payable after
deducting such trade-in allowance from the total selling price;
the amount of tax due from the retailer with respect to such
transaction; the amount of tax collected from the purchaser by
the retailer on such transaction (or satisfactory evidence that
such tax is not due in that particular instance, if that is
claimed to be the fact); the place and date of the sale, a
sufficient identification of the property sold, and such other
information as the Department may reasonably require.
Such transaction reporting return shall be filed not later

HB4494 - 36 - LRB100 13618 HLH 28242 b
than 20 days after the date of delivery of the item that is
being sold, but may be filed by the retailer at any time sooner
than that if he chooses to do so. The transaction reporting
return and tax remittance or proof of exemption from the tax
that is imposed by this Act may be transmitted to the
Department by way of the State agency with which, or State
officer with whom, the tangible personal property must be
titled or registered (if titling or registration is required)
if the Department and such agency or State officer determine
that this procedure will expedite the processing of
applications for title or registration.
With each such transaction reporting return, the retailer
shall remit the proper amount of tax due (or shall submit
satisfactory evidence that the sale is not taxable if that is
the case), to the Department or its agents, whereupon the
Department shall issue, in the purchaser's name, a tax receipt
(or a certificate of exemption if the Department is satisfied
that the particular sale is tax exempt) which such purchaser
may submit to the agency with which, or State officer with
whom, he must title or register the tangible personal property
that is involved (if titling or registration is required) in
support of such purchaser's application for an Illinois
certificate or other evidence of title or registration to such
tangible personal property.
No retailer's failure or refusal to remit tax under this
Act precludes a user, who has paid the proper tax to the

HB4494 - 37 - LRB100 13618 HLH 28242 b
retailer, from obtaining his certificate of title or other
evidence of title or registration (if titling or registration
is required) upon satisfying the Department that such user has
paid the proper tax (if tax is due) to the retailer. The
Department shall adopt appropriate rules to carry out the
mandate of this paragraph.
If the user who would otherwise pay tax to the retailer
wants the transaction reporting return filed and the payment of
tax or proof of exemption made to the Department before the
retailer is willing to take these actions and such user has not
paid the tax to the retailer, such user may certify to the fact
of such delay by the retailer, and may (upon the Department
being satisfied of the truth of such certification) transmit
the information required by the transaction reporting return
and the remittance for tax or proof of exemption directly to
the Department and obtain his tax receipt or exemption
determination, in which event the transaction reporting return
and tax remittance (if a tax payment was required) shall be
credited by the Department to the proper retailer's account
with the Department, but without the 2.1% or 1.75% discount
provided for in this Section being allowed. When the user pays
the tax directly to the Department, he shall pay the tax in the
same amount and in the same form in which it would be remitted
if the tax had been remitted to the Department by the retailer.
Where a retailer collects the tax with respect to the
selling price of tangible personal property which he sells and

HB4494 - 38 - LRB100 13618 HLH 28242 b
the purchaser thereafter returns such tangible personal
property and the retailer refunds the selling price thereof to
the purchaser, such retailer shall also refund, to the
purchaser, the tax so collected from the purchaser. When filing
his return for the period in which he refunds such tax to the
purchaser, the retailer may deduct the amount of the tax so
refunded by him to the purchaser from any other use tax which
such retailer may be required to pay or remit to the
Department, as shown by such return, if the amount of the tax
to be deducted was previously remitted to the Department by
such retailer. If the retailer has not previously remitted the
amount of such tax to the Department, he is entitled to no
deduction under this Act upon refunding such tax to the
purchaser.
Any retailer filing a return under this Section shall also
include (for the purpose of paying tax thereon) the total tax
covered by such return upon the selling price of tangible
personal property purchased by him at retail from a retailer,
but as to which the tax imposed by this Act was not collected
from the retailer filing such return, and such retailer shall
remit the amount of such tax to the Department when filing such
return.
If experience indicates such action to be practicable, the
Department may prescribe and furnish a combination or joint
return which will enable retailers, who are required to file
returns hereunder and also under the Retailers' Occupation Tax

HB4494 - 39 - LRB100 13618 HLH 28242 b
Act, to furnish all the return information required by both
Acts on the one form.
Where the retailer has more than one business registered
with the Department under separate registration under this Act,
such retailer may not file each return that is due as a single
return covering all such registered businesses, but shall file
separate returns for each such registered business.
Beginning January 1, 1990, each month the Department shall
pay into the State and Local Sales Tax Reform Fund, a special
fund in the State Treasury which is hereby created, the net
revenue realized for the preceding month from the 1% tax on
sales of food for human consumption which is to be consumed off
the premises where it is sold (other than alcoholic beverages,
soft drinks and food which has been prepared for immediate
consumption) and prescription and nonprescription medicines,
drugs, medical appliances, products classified as Class III
medical devices by the United States Food and Drug
Administration that are used for cancer treatment pursuant to a
prescription, as well as any accessories and components related
to those devices, and insulin, urine testing materials,
syringes and needles used by diabetics.
Beginning January 1, 1990, each month the Department shall
pay into the County and Mass Transit District Fund 4% of the
net revenue realized for the preceding month from the 6.25%
general rate on the selling price of tangible personal property
which is purchased outside Illinois at retail from a retailer

HB4494 - 40 - LRB100 13618 HLH 28242 b
and which is titled or registered by an agency of this State's
government.
Beginning January 1, 1990, each month the Department shall
pay into the State and Local Sales Tax Reform Fund, a special
fund in the State Treasury, 20% of the net revenue realized for
the preceding month from the 6.25% general rate on the selling
price of tangible personal property, other than tangible
personal property which is purchased outside Illinois at retail
from a retailer and which is titled or registered by an agency
of this State's government.
Beginning August 1, 2000, each month the Department shall
pay into the State and Local Sales Tax Reform Fund 100% of the
net revenue realized for the preceding month from the 1.25%
rate on the selling price of motor fuel and gasohol. Beginning
September 1, 2010, and beginning again on September 1, 2018,
each month the Department shall pay into the State and Local
Sales Tax Reform Fund 100% of the net revenue realized for the
preceding month from the 1.25% rate on the selling price of
sales tax holiday items.
Beginning January 1, 1990, each month the Department shall
pay into the Local Government Tax Fund 16% of the net revenue
realized for the preceding month from the 6.25% general rate on
the selling price of tangible personal property which is
purchased outside Illinois at retail from a retailer and which
is titled or registered by an agency of this State's
government.

HB4494 - 41 - LRB100 13618 HLH 28242 b
Beginning October 1, 2009, each month the Department shall
pay into the Capital Projects Fund an amount that is equal to
an amount estimated by the Department to represent 80% of the
net revenue realized for the preceding month from the sale of
candy, grooming and hygiene products, and soft drinks that had
been taxed at a rate of 1% prior to September 1, 2009 but that
are now taxed at 6.25%.
Beginning July 1, 2011, each month the Department shall pay
into the Clean Air Act Permit Fund 80% of the net revenue
realized for the preceding month from the 6.25% general rate on
the selling price of sorbents used in Illinois in the process
of sorbent injection as used to comply with the Environmental
Protection Act or the federal Clean Air Act, but the total
payment into the Clean Air Act Permit Fund under this Act and
the Retailers' Occupation Tax Act shall not exceed $2,000,000
in any fiscal year.
Beginning July 1, 2013, each month the Department shall pay
into the Underground Storage Tank Fund from the proceeds
collected under this Act, the Service Use Tax Act, the Service
Occupation Tax Act, and the Retailers' Occupation Tax Act an
amount equal to the average monthly deficit in the Underground
Storage Tank Fund during the prior year, as certified annually
by the Illinois Environmental Protection Agency, but the total
payment into the Underground Storage Tank Fund under this Act,
the Service Use Tax Act, the Service Occupation Tax Act, and
the Retailers' Occupation Tax Act shall not exceed $18,000,000

HB4494 - 42 - LRB100 13618 HLH 28242 b
in any State fiscal year. As used in this paragraph, the
"average monthly deficit" shall be equal to the difference
between the average monthly claims for payment by the fund and
the average monthly revenues deposited into the fund, excluding
payments made pursuant to this paragraph.
Beginning July 1, 2015, of the remainder of the moneys
received by the Department under this Act, the Service Use Tax
Act, the Service Occupation Tax Act, and the Retailers'
Occupation Tax Act, each month the Department shall deposit
$500,000 into the State Crime Laboratory Fund.
Of the remainder of the moneys received by the Department
pursuant to this Act, (a) 1.75% thereof shall be paid into the
Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on
and after July 1, 1989, 3.8% thereof shall be paid into the
Build Illinois Fund; provided, however, that if in any fiscal
year the sum of (1) the aggregate of 2.2% or 3.8%, as the case
may be, of the moneys received by the Department and required
to be paid into the Build Illinois Fund pursuant to Section 3
of the Retailers' Occupation Tax Act, Section 9 of the Use Tax
Act, Section 9 of the Service Use Tax Act, and Section 9 of the
Service Occupation Tax Act, such Acts being hereinafter called
the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case
may be, of moneys being hereinafter called the "Tax Act
Amount", and (2) the amount transferred to the Build Illinois
Fund from the State and Local Sales Tax Reform Fund shall be
less than the Annual Specified Amount (as defined in Section 3

HB4494 - 43 - LRB100 13618 HLH 28242 b
of the Retailers' Occupation Tax Act), an amount equal to the
difference shall be immediately paid into the Build Illinois
Fund from other moneys received by the Department pursuant to
the Tax Acts; and further provided, that if on the last
business day of any month the sum of (1) the Tax Act Amount
required to be deposited into the Build Illinois Bond Account
in the Build Illinois Fund during such month and (2) the amount
transferred during such month to the Build Illinois Fund from
the State and Local Sales Tax Reform Fund shall have been less
than 1/12 of the Annual Specified Amount, an amount equal to
the difference shall be immediately paid into the Build
Illinois Fund from other moneys received by the Department
pursuant to the Tax Acts; and, further provided, that in no
event shall the payments required under the preceding proviso
result in aggregate payments into the Build Illinois Fund
pursuant to this clause (b) for any fiscal year in excess of
the greater of (i) the Tax Act Amount or (ii) the Annual
Specified Amount for such fiscal year; and, further provided,
that the amounts payable into the Build Illinois Fund under
this clause (b) shall be payable only until such time as the
aggregate amount on deposit under each trust indenture securing
Bonds issued and outstanding pursuant to the Build Illinois
Bond Act is sufficient, taking into account any future
investment income, to fully provide, in accordance with such
indenture, for the defeasance of or the payment of the
principal of, premium, if any, and interest on the Bonds

HB4494 - 44 - LRB100 13618 HLH 28242 b
secured by such indenture and on any Bonds expected to be
issued thereafter and all fees and costs payable with respect
thereto, all as certified by the Director of the Bureau of the
Budget (now Governor's Office of Management and Budget). If on
the last business day of any month in which Bonds are
outstanding pursuant to the Build Illinois Bond Act, the
aggregate of the moneys deposited in the Build Illinois Bond
Account in the Build Illinois Fund in such month shall be less
than the amount required to be transferred in such month from
the Build Illinois Bond Account to the Build Illinois Bond
Retirement and Interest Fund pursuant to Section 13 of the
Build Illinois Bond Act, an amount equal to such deficiency
shall be immediately paid from other moneys received by the
Department pursuant to the Tax Acts to the Build Illinois Fund;
provided, however, that any amounts paid to the Build Illinois
Fund in any fiscal year pursuant to this sentence shall be
deemed to constitute payments pursuant to clause (b) of the
preceding sentence and shall reduce the amount otherwise
payable for such fiscal year pursuant to clause (b) of the
preceding sentence. The moneys received by the Department
pursuant to this Act and required to be deposited into the
Build Illinois Fund are subject to the pledge, claim and charge
set forth in Section 12 of the Build Illinois Bond Act.
Subject to payment of amounts into the Build Illinois Fund
as provided in the preceding paragraph or in any amendment
thereto hereafter enacted, the following specified monthly

HB4494 - 45 - LRB100 13618 HLH 28242 b
installment of the amount requested in the certificate of the
Chairman of the Metropolitan Pier and Exposition Authority
provided under Section 8.25f of the State Finance Act, but not
in excess of the sums designated as "Total Deposit", shall be
deposited in the aggregate from collections under Section 9 of
the Use Tax Act, Section 9 of the Service Use Tax Act, Section
9 of the Service Occupation Tax Act, and Section 3 of the
Retailers' Occupation Tax Act into the McCormick Place
Expansion Project Fund in the specified fiscal years.
Fiscal Year Total Deposit
1993 $0
1994 53,000,000
1995 58,000,000
1996 61,000,000
1997 64,000,000
1998 68,000,000
1999 71,000,000
2000 75,000,000
2001 80,000,000
2002 93,000,000
2003 99,000,000
2004 103,000,000
2005 108,000,000
2006 113,000,000
2007 119,000,000
2008 126,000,000

HB4494 - 46 - LRB100 13618 HLH 28242 b
2009 132,000,000
2010 139,000,000
2011 146,000,000
2012 153,000,000
2013 161,000,000
2014 170,000,000
2015 179,000,000
2016 189,000,000
2017 199,000,000
2018 210,000,000
2019 221,000,000
2020 233,000,000
2021 246,000,000
2022 260,000,000
2023 275,000,000
2024 275,000,000
2025 275,000,000
2026 279,000,000
2027 292,000,000
2028 307,000,000
2029 322,000,000
2030 338,000,000
2031 350,000,000
2032 350,000,000
and
each fiscal year

HB4494 - 47 - LRB100 13618 HLH 28242 b
thereafter that bonds
are outstanding under
Section 13.2 of the
Metropolitan Pier and
Exposition Authority Act,
but not after fiscal year 2060.
Beginning July 20, 1993 and in each month of each fiscal
year thereafter, one-eighth of the amount requested in the
certificate of the Chairman of the Metropolitan Pier and
Exposition Authority for that fiscal year, less the amount
deposited into the McCormick Place Expansion Project Fund by
the State Treasurer in the respective month under subsection
(g) of Section 13 of the Metropolitan Pier and Exposition
Authority Act, plus cumulative deficiencies in the deposits
required under this Section for previous months and years,
shall be deposited into the McCormick Place Expansion Project
Fund, until the full amount requested for the fiscal year, but
not in excess of the amount specified above as "Total Deposit",
has been deposited.
Subject to payment of amounts into the Build Illinois Fund
and the McCormick Place Expansion Project Fund pursuant to the
preceding paragraphs or in any amendments thereto hereafter
enacted, beginning July 1, 1993 and ending on September 30,
2013, the Department shall each month pay into the Illinois Tax
Increment Fund 0.27% of 80% of the net revenue realized for the
preceding month from the 6.25% general rate on the selling

HB4494 - 48 - LRB100 13618 HLH 28242 b
price of tangible personal property.
Subject to payment of amounts into the Build Illinois Fund
and the McCormick Place Expansion Project Fund pursuant to the
preceding paragraphs or in any amendments thereto hereafter
enacted, beginning with the receipt of the first report of
taxes paid by an eligible business and continuing for a 25-year
period, the Department shall each month pay into the Energy
Infrastructure Fund 80% of the net revenue realized from the
6.25% general rate on the selling price of Illinois-mined coal
that was sold to an eligible business. For purposes of this
paragraph, the term "eligible business" means a new electric
generating facility certified pursuant to Section 605-332 of
the Department of Commerce and Economic Opportunity Law of the
Civil Administrative Code of Illinois.
Subject to payment of amounts into the Build Illinois Fund,
the McCormick Place Expansion Project Fund, the Illinois Tax
Increment Fund, and the Energy Infrastructure Fund pursuant to
the preceding paragraphs or in any amendments to this Section
hereafter enacted, beginning on the first day of the first
calendar month to occur on or after August 26, 2014 (the
effective date of Public Act 98-1098) this amendatory Act of
the 98th General Assembly, each month, from the collections
made under Section 9 of the Use Tax Act, Section 9 of the
Service Use Tax Act, Section 9 of the Service Occupation Tax
Act, and Section 3 of the Retailers' Occupation Tax Act, the
Department shall pay into the Tax Compliance and Administration

HB4494 - 49 - LRB100 13618 HLH 28242 b
Fund, to be used, subject to appropriation, to fund additional
auditors and compliance personnel at the Department of Revenue,
an amount equal to 1/12 of 5% of 80% of the cash receipts
collected during the preceding fiscal year by the Audit Bureau
of the Department under the Use Tax Act, the Service Use Tax
Act, the Service Occupation Tax Act, the Retailers' Occupation
Tax Act, and associated local occupation and use taxes
administered by the Department.
Of the remainder of the moneys received by the Department
pursuant to this Act, 75% thereof shall be paid into the State
Treasury and 25% shall be reserved in a special account and
used only for the transfer to the Common School Fund as part of
the monthly transfer from the General Revenue Fund in
accordance with Section 8a of the State Finance Act.
As soon as possible after the first day of each month, upon
certification of the Department of Revenue, the Comptroller
shall order transferred and the Treasurer shall transfer from
the General Revenue Fund to the Motor Fuel Tax Fund an amount
equal to 1.7% of 80% of the net revenue realized under this Act
for the second preceding month. Beginning April 1, 2000, this
transfer is no longer required and shall not be made.
Net revenue realized for a month shall be the revenue
collected by the State pursuant to this Act, less the amount
paid out during that month as refunds to taxpayers for
overpayment of liability.
For greater simplicity of administration, manufacturers,

HB4494 - 50 - LRB100 13618 HLH 28242 b
importers and wholesalers whose products are sold at retail in
Illinois by numerous retailers, and who wish to do so, may
assume the responsibility for accounting and paying to the
Department all tax accruing under this Act with respect to such
sales, if the retailers who are affected do not make written
objection to the Department to this arrangement.
(Source: P.A. 98-24, eff. 6-19-13; 98-109, eff. 7-25-13;
98-496, eff. 1-1-14; 98-756, eff. 7-16-14; 98-1098, eff.
8-26-14; 99-352, eff. 8-12-15; 99-858, eff. 8-19-16; 99-933,
eff. 1-27-17; revised 2-3-17.)
Section 15. The Retailers' Occupation Tax Act is amended by
changing Sections 2-8, 2-10, and 3 as follows:
(35 ILCS 120/2-8)
Sec. 2-8. Sales tax holiday items.
(a) The tangible personal property described in this
subsection qualifies for the 1.25% reduced rate of tax during
for the period set forth in Section 2-10 of this Act
(hereinafter referred to as the Sales Tax Holiday Period). The
reduced rate on these items shall be administered under the
provisions of subsection (b) of this Section. The following
items are subject to the reduced rate:
(1) Clothing items that each have a retail selling
price of less than $100.
"Clothing" means, unless otherwise specified in this

HB4494 - 51 - LRB100 13618 HLH 28242 b
Section, all human wearing apparel suitable for general
use. "Clothing" does not include clothing accessories,
protective equipment, or sport or recreational equipment.
"Clothing" includes, but is not limited to: household and
shop aprons; athletic supporters; bathing suits and caps;
belts and suspenders; boots; coats and jackets; ear muffs;
footlets; gloves and mittens for general use; hats and
caps; hosiery; insoles for shoes; lab coats; neckties;
overshoes; pantyhose; rainwear; rubber pants; sandals;
scarves; shoes and shoelaces; slippers; sneakers; socks
and stockings; steel-toed shoes; underwear; and school
uniforms.
"Clothing accessories" means, but is not limited to:
briefcases; cosmetics; hair notions, including, but not
limited to barrettes, hair bows, and hair nets; handbags;
handkerchiefs; jewelry; non-prescription sunglasses;
umbrellas; wallets; watches; and wigs and hair pieces.
"Protective equipment" means, but is not limited to:
breathing masks; clean room apparel and equipment; ear and
hearing protectors; face shields; hard hats; helmets;
paint or dust respirators; protective gloves; safety
glasses and goggles; safety belts; tool belts; and welder's
gloves and masks.
"Sport or recreational equipment" means, but is not
limited to: ballet and tap shoes; cleated or spiked
athletic shoes; gloves, including, but not limited to,

HB4494 - 52 - LRB100 13618 HLH 28242 b
baseball, bowling, boxing, hockey, and golf gloves;
goggles; hand and elbow guards; life preservers and vests;
mouth guards; roller and ice skates; shin guards; shoulder
pads; ski boots; waders; and wetsuits and fins.
(2) School supplies. "School supplies" means, unless
otherwise specified in this Section, items used by a
student in a course of study. The purchase of school
supplies for use by persons other than students for use in
a course of study are not eligible for the reduced rate of
tax. "School supplies" do not include school art supplies;
school instructional materials; cameras; film and memory
cards; videocameras, tapes, and videotapes; computers;
cell phones; Personal Digital Assistants (PDAs); handheld
electronic schedulers; and school computer supplies.
"School supplies" includes, but is not limited to:
binders; book bags; calculators; cellophane tape;
blackboard chalk; compasses; composition books; crayons;
erasers; expandable, pocket, plastic, and manila folders;
glue, paste, and paste sticks; highlighters; index cards;
index card boxes; legal pads; lunch boxes; markers;
notebooks; paper, including loose leaf ruled notebook
paper, copy paper, graph paper, tracing paper, manila
paper, colored paper, poster board, and construction
paper; pencils; pencil leads; pens; ink and ink refills for
pens; pencil boxes and other school supply boxes; pencil
sharpeners; protractors; rulers; scissors; and writing

HB4494 - 53 - LRB100 13618 HLH 28242 b
tablets.
"School art supply" means an item commonly used by a
student in a course of study for artwork and includes only
the following items: clay and glazes; acrylic, tempera, and
oil paint; paintbrushes for artwork; sketch and drawing
pads; and watercolors.
"School instructional material" means written material
commonly used by a student in a course of study as a
reference and to learn the subject being taught and
includes only the following items: reference books;
reference maps and globes; textbooks; and workbooks.
"School computer supply" means an item commonly used by
a student in a course of study in which a computer is used
and applies only to the following items: flashdrives and
other computer data storage devices; data storage media,
such as diskettes and compact disks; boxes and cases for
disk storage; external ports or drives; computer cases;
computer cables; computer printers; and printer
cartridges, toner, and ink.
(b) Administration. Notwithstanding any other provision of
this Act, the reduced rate of tax under Section 3-10 of this
Act for clothing and school supplies shall be administered by
the Department under the provisions of this subsection (b).
(1) Bundled sales. Items that qualify for the reduced
rate of tax that are bundled together with items that do
not qualify for the reduced rate of tax and that are sold

HB4494 - 54 - LRB100 13618 HLH 28242 b
for one itemized price will be subject to the reduced rate
of tax only if the value of the items that qualify for the
reduced rate of tax exceeds the value of the items that do
not qualify for the reduced rate of tax.
(2) Coupons and discounts. An unreimbursed discount by
the seller reduces the sales price of the property so that
the discounted sales price determines whether the sales
price is within a sales tax holiday price threshold. A
coupon or other reduction in the sales price is treated as
a discount if the seller is not reimbursed for the coupon
or reduction amount by a third party.
(3) Splitting of items normally sold together.
Articles that are normally sold as a single unit must
continue to be sold in that manner. Such articles cannot be
priced separately and sold as individual items in order to
obtain the reduced rate of tax. For example, a pair of
shoes cannot have each shoe sold separately so that the
sales price of each shoe is within a sales tax holiday
price threshold.
(4) Rain checks. A rain check is a procedure that
allows a customer to purchase an item at a certain price at
a later time because the particular item was out of stock.
Eligible property that customers purchase during the Sales
Tax Holiday Period with the use of a rain check will
qualify for the reduced rate of tax regardless of when the
rain check was issued. Issuance of a rain check during the

HB4494 - 55 - LRB100 13618 HLH 28242 b
Sales Tax Holiday Period will not qualify eligible property
for the reduced rate of tax if the property is actually
purchased after the Sales Tax Holiday Period.
(5) Exchanges. The procedure for an exchange in regards
to a sales tax holiday is as follows:
(A) If a customer purchases an item of eligible
property during the Sales Tax Holiday Period, but later
exchanges the item for a similar eligible item, even if
a different size, different color, or other feature, no
additional tax is due even if the exchange is made
after the Sales Tax Holiday Period.
(B) If a customer purchases an item of eligible
property during the Sales Tax Holiday Period, but after
the Sales Tax Holiday Period has ended, the customer
returns the item and receives credit on the purchase of
a different item, the 6.25% general merchandise sales
tax rate is due on the sale of the newly purchased
item.
(C) If a customer purchases an item of eligible
property before the Sales Tax Holiday Period, but
during the Sales Tax Holiday Period the customer
returns the item and receives credit on the purchase of
a different item of eligible property, the reduced rate
of tax is due on the sale of the new item if the new
item is purchased during the Sales Tax Holiday Period.
(6) Delivery charges. Delivery charges, including

HB4494 - 56 - LRB100 13618 HLH 28242 b
shipping, handling and service charges, are part of the
sales price of eligible property.
(7) Order date and back orders. For the purpose of a
sales tax holiday, eligible property qualifies for the
reduced rate of tax if: (i) the item is both delivered to
and paid for by the customer during the Sales Tax Holiday
Period or (ii) the customer orders and pays for the item
and the seller accepts the order during the Sales Tax
Holiday Period for immediate shipment, even if delivery is
made after the Sales Tax Holiday Period. The seller accepts
an order when the seller has taken action to fill the order
for immediate shipment. Actions to fill an order include
placement of an "in date" stamp on an order or assignment
of an "order number" to an order within the Sales Tax
Holiday Period. An order is for immediate shipment when the
customer does not request delayed shipment. An order is for
immediate shipment notwithstanding that the shipment may
be delayed because of a backlog of orders or because stock
is currently unavailable to, or on back order by, the
seller.
(8) Returns. For a 60-day period immediately after the
Sales Tax Holiday Period, if a customer returns an item
that would qualify for the reduced rate of tax, credit for
or refund of sales tax shall be given only at the reduced
rate unless the customer provides a receipt or invoice that
shows tax was paid at the 6.25% general merchandise rate,

HB4494 - 57 - LRB100 13618 HLH 28242 b
or the seller has sufficient documentation to show that tax
was paid at the 6.25% general merchandise rate on the
specific item. This 60-day period is set solely for the
purpose of designating a time period during which the
customer must provide documentation that shows that the
appropriate sales tax rate was paid on returned
merchandise. The 60-day period is not intended to change a
seller's policy on the time period during which the seller
will accept returns.
(c) The Department may implement the provisions of this
Section through the use of emergency rules, along with
permanent rules filed concurrently with such emergency rules,
in accordance with the provisions of Section 5-45 of the
Illinois Administrative Procedure Act. For purposes of the
Illinois Administrative Procedure Act, the adoption of rules to
implement the provisions of this Section shall be deemed an
emergency and necessary for the public interest, safety, and
welfare.
(d) As used in this Act, "Sales Tax Holiday Period" means
the period beginning on August 6, 2010 and ending on August 15,
2010 and the period beginning on August 5, 2018 and ending on
August 11, 2018.
(Source: P.A. 96-1012, eff. 7-7-10.)
(35 ILCS 120/2-10)
Sec. 2-10. Rate of tax. Unless otherwise provided in this

HB4494 - 58 - LRB100 13618 HLH 28242 b
Section, the tax imposed by this Act is at the rate of 6.25% of
gross receipts from sales of tangible personal property made in
the course of business.
Beginning on July 1, 2000 and through December 31, 2000,
with respect to motor fuel, as defined in Section 1.1 of the
Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
the Use Tax Act, the tax is imposed at the rate of 1.25%.
During the Sales Tax Holiday Period, as defined in Section
2-8 of this Act Beginning on August 6, 2010 through August 15,
2010, with respect to sales tax holiday items as defined in
Section 2-8 of this Act, the tax is imposed at the rate of
1.25%.
Within 14 days after the effective date of this amendatory
Act of the 91st General Assembly, each retailer of motor fuel
and gasohol shall cause the following notice to be posted in a
prominently visible place on each retail dispensing device that
is used to dispense motor fuel or gasohol in the State of
Illinois: "As of July 1, 2000, the State of Illinois has
eliminated the State's share of sales tax on motor fuel and
gasohol through December 31, 2000. The price on this pump
should reflect the elimination of the tax." The notice shall be
printed in bold print on a sign that is no smaller than 4
inches by 8 inches. The sign shall be clearly visible to
customers. Any retailer who fails to post or maintain a
required sign through December 31, 2000 is guilty of a petty
offense for which the fine shall be $500 per day per each

HB4494 - 59 - LRB100 13618 HLH 28242 b
retail premises where a violation occurs.
With respect to gasohol, as defined in the Use Tax Act, the
tax imposed by this Act applies to (i) 70% of the proceeds of
sales made on or after January 1, 1990, and before July 1,
2003, (ii) 80% of the proceeds of sales made on or after July
1, 2003 and on or before July 1, 2017, and (iii) 100% of the
proceeds of sales made thereafter. If, at any time, however,
the tax under this Act on sales of gasohol, as defined in the
Use Tax Act, is imposed at the rate of 1.25%, then the tax
imposed by this Act applies to 100% of the proceeds of sales of
gasohol made during that time.
With respect to majority blended ethanol fuel, as defined
in the Use Tax Act, the tax imposed by this Act does not apply
to the proceeds of sales made on or after July 1, 2003 and on or
before December 31, 2023 but applies to 100% of the proceeds of
sales made thereafter.
With respect to biodiesel blends, as defined in the Use Tax
Act, with no less than 1% and no more than 10% biodiesel, the
tax imposed by this Act applies to (i) 80% of the proceeds of
sales made on or after July 1, 2003 and on or before December
31, 2018 and (ii) 100% of the proceeds of sales made
thereafter. If, at any time, however, the tax under this Act on
sales of biodiesel blends, as defined in the Use Tax Act, with
no less than 1% and no more than 10% biodiesel is imposed at
the rate of 1.25%, then the tax imposed by this Act applies to
100% of the proceeds of sales of biodiesel blends with no less

HB4494 - 60 - LRB100 13618 HLH 28242 b
than 1% and no more than 10% biodiesel made during that time.
With respect to 100% biodiesel, as defined in the Use Tax
Act, and biodiesel blends, as defined in the Use Tax Act, with
more than 10% but no more than 99% biodiesel, the tax imposed
by this Act does not apply to the proceeds of sales made on or
after July 1, 2003 and on or before December 31, 2023 but
applies to 100% of the proceeds of sales made thereafter.
With respect to food for human consumption that is to be
consumed off the premises where it is sold (other than
alcoholic beverages, soft drinks, and food that has been
prepared for immediate consumption) and prescription and
nonprescription medicines, drugs, medical appliances, products
classified as Class III medical devices by the United States
Food and Drug Administration that are used for cancer treatment
pursuant to a prescription, as well as any accessories and
components related to those devices, modifications to a motor
vehicle for the purpose of rendering it usable by a person with
a disability, and insulin, urine testing materials, syringes,
and needles used by diabetics, for human use, the tax is
imposed at the rate of 1%. For the purposes of this Section,
until September 1, 2009: the term "soft drinks" means any
complete, finished, ready-to-use, non-alcoholic drink, whether
carbonated or not, including but not limited to soda water,
cola, fruit juice, vegetable juice, carbonated water, and all
other preparations commonly known as soft drinks of whatever
kind or description that are contained in any closed or sealed

HB4494 - 61 - LRB100 13618 HLH 28242 b
bottle, can, carton, or container, regardless of size; but
"soft drinks" does not include coffee, tea, non-carbonated
water, infant formula, milk or milk products as defined in the
Grade A Pasteurized Milk and Milk Products Act, or drinks
containing 50% or more natural fruit or vegetable juice.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "soft drinks" means non-alcoholic
beverages that contain natural or artificial sweeteners. "Soft
drinks" do not include beverages that contain milk or milk
products, soy, rice or similar milk substitutes, or greater
than 50% of vegetable or fruit juice by volume.
Until August 1, 2009, and notwithstanding any other
provisions of this Act, "food for human consumption that is to
be consumed off the premises where it is sold" includes all
food sold through a vending machine, except soft drinks and
food products that are dispensed hot from a vending machine,
regardless of the location of the vending machine. Beginning
August 1, 2009, and notwithstanding any other provisions of
this Act, "food for human consumption that is to be consumed
off the premises where it is sold" includes all food sold
through a vending machine, except soft drinks, candy, and food
products that are dispensed hot from a vending machine,
regardless of the location of the vending machine.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "food for human consumption that
is to be consumed off the premises where it is sold" does not

HB4494 - 62 - LRB100 13618 HLH 28242 b
include candy. For purposes of this Section, "candy" means a
preparation of sugar, honey, or other natural or artificial
sweeteners in combination with chocolate, fruits, nuts or other
ingredients or flavorings in the form of bars, drops, or
pieces. "Candy" does not include any preparation that contains
flour or requires refrigeration.
Notwithstanding any other provisions of this Act,
beginning September 1, 2009, "nonprescription medicines and
drugs" does not include grooming and hygiene products. For
purposes of this Section, "grooming and hygiene products"
includes, but is not limited to, soaps and cleaning solutions,
shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
lotions and screens, unless those products are available by
prescription only, regardless of whether the products meet the
definition of "over-the-counter-drugs". For the purposes of
this paragraph, "over-the-counter-drug" means a drug for human
use that contains a label that identifies the product as a drug
as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
label includes:
(A) A "Drug Facts" panel; or
(B) A statement of the "active ingredient(s)" with a
list of those ingredients contained in the compound,
substance or preparation.
Beginning on the effective date of this amendatory Act of
the 98th General Assembly, "prescription and nonprescription
medicines and drugs" includes medical cannabis purchased from a

HB4494 - 63 - LRB100 13618 HLH 28242 b
registered dispensing organization under the Compassionate Use
of Medical Cannabis Pilot Program Act.
(Source: P.A. 99-143, eff. 7-27-15; 99-858, eff. 8-19-16;
100-22, eff. 7-6-17.)
(35 ILCS 120/3) (from Ch. 120, par. 442)
Sec. 3. Except as provided in this Section, on or before
the twentieth day of each calendar month, every person engaged
in the business of selling tangible personal property at retail
in this State during the preceding calendar month shall file a
return with the Department, stating:
1. The name of the seller;
2. His residence address and the address of his
principal place of business and the address of the
principal place of business (if that is a different
address) from which he engages in the business of selling
tangible personal property at retail in this State;
3. Total amount of receipts received by him during the
preceding calendar month or quarter, as the case may be,
from sales of tangible personal property, and from services
furnished, by him during such preceding calendar month or
quarter;
4. Total amount received by him during the preceding
calendar month or quarter on charge and time sales of
tangible personal property, and from services furnished,
by him prior to the month or quarter for which the return

HB4494 - 64 - LRB100 13618 HLH 28242 b
is filed;
5. Deductions allowed by law;
6. Gross receipts which were received by him during the
preceding calendar month or quarter and upon the basis of
which the tax is imposed;
7. The amount of credit provided in Section 2d of this
Act;
8. The amount of tax due;
9. The signature of the taxpayer; and
10. Such other reasonable information as the
Department may require.
If a taxpayer fails to sign a return within 30 days after
the proper notice and demand for signature by the Department,
the return shall be considered valid and any amount shown to be
due on the return shall be deemed assessed.
Each return shall be accompanied by the statement of
prepaid tax issued pursuant to Section 2e for which credit is
claimed.
Prior to October 1, 2003, and on and after September 1,
2004 a retailer may accept a Manufacturer's Purchase Credit
certification from a purchaser in satisfaction of Use Tax as
provided in Section 3-85 of the Use Tax Act if the purchaser
provides the appropriate documentation as required by Section
3-85 of the Use Tax Act. A Manufacturer's Purchase Credit
certification, accepted by a retailer prior to October 1, 2003
and on and after September 1, 2004 as provided in Section 3-85

HB4494 - 65 - LRB100 13618 HLH 28242 b
of the Use Tax Act, may be used by that retailer to satisfy
Retailers' Occupation Tax liability in the amount claimed in
the certification, not to exceed 6.25% of the receipts subject
to tax from a qualifying purchase. A Manufacturer's Purchase
Credit reported on any original or amended return filed under
this Act after October 20, 2003 for reporting periods prior to
September 1, 2004 shall be disallowed. Manufacturer's
Purchaser Credit reported on annual returns due on or after
January 1, 2005 will be disallowed for periods prior to
September 1, 2004. No Manufacturer's Purchase Credit may be
used after September 30, 2003 through August 31, 2004 to
satisfy any tax liability imposed under this Act, including any
audit liability.
The Department may require returns to be filed on a
quarterly basis. If so required, a return for each calendar
quarter shall be filed on or before the twentieth day of the
calendar month following the end of such calendar quarter. The
taxpayer shall also file a return with the Department for each
of the first two months of each calendar quarter, on or before
the twentieth day of the following calendar month, stating:
1. The name of the seller;
2. The address of the principal place of business from
which he engages in the business of selling tangible
personal property at retail in this State;
3. The total amount of taxable receipts received by him
during the preceding calendar month from sales of tangible

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personal property by him during such preceding calendar
month, including receipts from charge and time sales, but
less all deductions allowed by law;
4. The amount of credit provided in Section 2d of this
Act;
5. The amount of tax due; and
6. Such other reasonable information as the Department
may require.
Beginning on October 1, 2003, any person who is not a
licensed distributor, importing distributor, or manufacturer,
as defined in the Liquor Control Act of 1934, but is engaged in
the business of selling, at retail, alcoholic liquor shall file
a statement with the Department of Revenue, in a format and at
a time prescribed by the Department, showing the total amount
paid for alcoholic liquor purchased during the preceding month
and such other information as is reasonably required by the
Department. The Department may adopt rules to require that this
statement be filed in an electronic or telephonic format. Such
rules may provide for exceptions from the filing requirements
of this paragraph. For the purposes of this paragraph, the term
"alcoholic liquor" shall have the meaning prescribed in the
Liquor Control Act of 1934.
Beginning on October 1, 2003, every distributor, importing
distributor, and manufacturer of alcoholic liquor as defined in
the Liquor Control Act of 1934, shall file a statement with the
Department of Revenue, no later than the 10th day of the month

HB4494 - 67 - LRB100 13618 HLH 28242 b
for the preceding month during which transactions occurred, by
electronic means, showing the total amount of gross receipts
from the sale of alcoholic liquor sold or distributed during
the preceding month to purchasers; identifying the purchaser to
whom it was sold or distributed; the purchaser's tax
registration number; and such other information reasonably
required by the Department. A distributor, importing
distributor, or manufacturer of alcoholic liquor must
personally deliver, mail, or provide by electronic means to
each retailer listed on the monthly statement a report
containing a cumulative total of that distributor's, importing
distributor's, or manufacturer's total sales of alcoholic
liquor to that retailer no later than the 10th day of the month
for the preceding month during which the transaction occurred.
The distributor, importing distributor, or manufacturer shall
notify the retailer as to the method by which the distributor,
importing distributor, or manufacturer will provide the sales
information. If the retailer is unable to receive the sales
information by electronic means, the distributor, importing
distributor, or manufacturer shall furnish the sales
information by personal delivery or by mail. For purposes of
this paragraph, the term "electronic means" includes, but is
not limited to, the use of a secure Internet website, e-mail,
or facsimile.
If a total amount of less than $1 is payable, refundable or
creditable, such amount shall be disregarded if it is less than

HB4494 - 68 - LRB100 13618 HLH 28242 b
50 cents and shall be increased to $1 if it is 50 cents or more.
Beginning October 1, 1993, a taxpayer who has an average
monthly tax liability of $150,000 or more shall make all
payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 1994, a taxpayer who has
an average monthly tax liability of $100,000 or more shall make
all payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 1995, a taxpayer who has
an average monthly tax liability of $50,000 or more shall make
all payments required by rules of the Department by electronic
funds transfer. Beginning October 1, 2000, a taxpayer who has
an annual tax liability of $200,000 or more shall make all
payments required by rules of the Department by electronic
funds transfer. The term "annual tax liability" shall be the
sum of the taxpayer's liabilities under this Act, and under all
other State and local occupation and use tax laws administered
by the Department, for the immediately preceding calendar year.
The term "average monthly tax liability" shall be the sum of
the taxpayer's liabilities under this Act, and under all other
State and local occupation and use tax laws administered by the
Department, for the immediately preceding calendar year
divided by 12. Beginning on October 1, 2002, a taxpayer who has
a tax liability in the amount set forth in subsection (b) of
Section 2505-210 of the Department of Revenue Law shall make
all payments required by rules of the Department by electronic
funds transfer.

HB4494 - 69 - LRB100 13618 HLH 28242 b
Before August 1 of each year beginning in 1993, the
Department shall notify all taxpayers required to make payments
by electronic funds transfer. All taxpayers required to make
payments by electronic funds transfer shall make those payments
for a minimum of one year beginning on October 1.
Any taxpayer not required to make payments by electronic
funds transfer may make payments by electronic funds transfer
with the permission of the Department.
All taxpayers required to make payment by electronic funds
transfer and any taxpayers authorized to voluntarily make
payments by electronic funds transfer shall make those payments
in the manner authorized by the Department.
The Department shall adopt such rules as are necessary to
effectuate a program of electronic funds transfer and the
requirements of this Section.
Any amount which is required to be shown or reported on any
return or other document under this Act shall, if such amount
is not a whole-dollar amount, be increased to the nearest
whole-dollar amount in any case where the fractional part of a
dollar is 50 cents or more, and decreased to the nearest
whole-dollar amount where the fractional part of a dollar is
less than 50 cents.
If the retailer is otherwise required to file a monthly
return and if the retailer's average monthly tax liability to
the Department does not exceed $200, the Department may
authorize his returns to be filed on a quarter annual basis,

HB4494 - 70 - LRB100 13618 HLH 28242 b
with the return for January, February and March of a given year
being due by April 20 of such year; with the return for April,
May and June of a given year being due by July 20 of such year;
with the return for July, August and September of a given year
being due by October 20 of such year, and with the return for
October, November and December of a given year being due by
January 20 of the following year.
If the retailer is otherwise required to file a monthly or
quarterly return and if the retailer's average monthly tax
liability with the Department does not exceed $50, the
Department may authorize his returns to be filed on an annual
basis, with the return for a given year being due by January 20
of the following year.
Such quarter annual and annual returns, as to form and
substance, shall be subject to the same requirements as monthly
returns.
Notwithstanding any other provision in this Act concerning
the time within which a retailer may file his return, in the
case of any retailer who ceases to engage in a kind of business
which makes him responsible for filing returns under this Act,
such retailer shall file a final return under this Act with the
Department not more than one month after discontinuing such
business.
Where the same person has more than one business registered
with the Department under separate registrations under this
Act, such person may not file each return that is due as a

HB4494 - 71 - LRB100 13618 HLH 28242 b
single return covering all such registered businesses, but
shall file separate returns for each such registered business.
In addition, with respect to motor vehicles, watercraft,
aircraft, and trailers that are required to be registered with
an agency of this State, every retailer selling this kind of
tangible personal property shall file, with the Department,
upon a form to be prescribed and supplied by the Department, a
separate return for each such item of tangible personal
property which the retailer sells, except that if, in the same
transaction, (i) a retailer of aircraft, watercraft, motor
vehicles or trailers transfers more than one aircraft,
watercraft, motor vehicle or trailer to another aircraft,
watercraft, motor vehicle retailer or trailer retailer for the
purpose of resale or (ii) a retailer of aircraft, watercraft,
motor vehicles, or trailers transfers more than one aircraft,
watercraft, motor vehicle, or trailer to a purchaser for use as
a qualifying rolling stock as provided in Section 2-5 of this
Act, then that seller may report the transfer of all aircraft,
watercraft, motor vehicles or trailers involved in that
transaction to the Department on the same uniform
invoice-transaction reporting return form. For purposes of
this Section, "watercraft" means a Class 2, Class 3, or Class 4
watercraft as defined in Section 3-2 of the Boat Registration
and Safety Act, a personal watercraft, or any boat equipped
with an inboard motor.
Any retailer who sells only motor vehicles, watercraft,

HB4494 - 72 - LRB100 13618 HLH 28242 b
aircraft, or trailers that are required to be registered with
an agency of this State, so that all retailers' occupation tax
liability is required to be reported, and is reported, on such
transaction reporting returns and who is not otherwise required
to file monthly or quarterly returns, need not file monthly or
quarterly returns. However, those retailers shall be required
to file returns on an annual basis.
The transaction reporting return, in the case of motor
vehicles or trailers that are required to be registered with an
agency of this State, shall be the same document as the Uniform
Invoice referred to in Section 5-402 of The Illinois Vehicle
Code and must show the name and address of the seller; the name
and address of the purchaser; the amount of the selling price
including the amount allowed by the retailer for traded-in
property, if any; the amount allowed by the retailer for the
traded-in tangible personal property, if any, to the extent to
which Section 1 of this Act allows an exemption for the value
of traded-in property; the balance payable after deducting such
trade-in allowance from the total selling price; the amount of
tax due from the retailer with respect to such transaction; the
amount of tax collected from the purchaser by the retailer on
such transaction (or satisfactory evidence that such tax is not
due in that particular instance, if that is claimed to be the
fact); the place and date of the sale; a sufficient
identification of the property sold; such other information as
is required in Section 5-402 of The Illinois Vehicle Code, and

HB4494 - 73 - LRB100 13618 HLH 28242 b
such other information as the Department may reasonably
require.
The transaction reporting return in the case of watercraft
or aircraft must show the name and address of the seller; the
name and address of the purchaser; the amount of the selling
price including the amount allowed by the retailer for
traded-in property, if any; the amount allowed by the retailer
for the traded-in tangible personal property, if any, to the
extent to which Section 1 of this Act allows an exemption for
the value of traded-in property; the balance payable after
deducting such trade-in allowance from the total selling price;
the amount of tax due from the retailer with respect to such
transaction; the amount of tax collected from the purchaser by
the retailer on such transaction (or satisfactory evidence that
such tax is not due in that particular instance, if that is
claimed to be the fact); the place and date of the sale, a
sufficient identification of the property sold, and such other
information as the Department may reasonably require.
Such transaction reporting return shall be filed not later
than 20 days after the day of delivery of the item that is
being sold, but may be filed by the retailer at any time sooner
than that if he chooses to do so. The transaction reporting
return and tax remittance or proof of exemption from the
Illinois use tax may be transmitted to the Department by way of
the State agency with which, or State officer with whom the
tangible personal property must be titled or registered (if

HB4494 - 74 - LRB100 13618 HLH 28242 b
titling or registration is required) if the Department and such
agency or State officer determine that this procedure will
expedite the processing of applications for title or
registration.
With each such transaction reporting return, the retailer
shall remit the proper amount of tax due (or shall submit
satisfactory evidence that the sale is not taxable if that is
the case), to the Department or its agents, whereupon the
Department shall issue, in the purchaser's name, a use tax
receipt (or a certificate of exemption if the Department is
satisfied that the particular sale is tax exempt) which such
purchaser may submit to the agency with which, or State officer
with whom, he must title or register the tangible personal
property that is involved (if titling or registration is
required) in support of such purchaser's application for an
Illinois certificate or other evidence of title or registration
to such tangible personal property.
No retailer's failure or refusal to remit tax under this
Act precludes a user, who has paid the proper tax to the
retailer, from obtaining his certificate of title or other
evidence of title or registration (if titling or registration
is required) upon satisfying the Department that such user has
paid the proper tax (if tax is due) to the retailer. The
Department shall adopt appropriate rules to carry out the
mandate of this paragraph.
If the user who would otherwise pay tax to the retailer

HB4494 - 75 - LRB100 13618 HLH 28242 b
wants the transaction reporting return filed and the payment of
the tax or proof of exemption made to the Department before the
retailer is willing to take these actions and such user has not
paid the tax to the retailer, such user may certify to the fact
of such delay by the retailer and may (upon the Department
being satisfied of the truth of such certification) transmit
the information required by the transaction reporting return
and the remittance for tax or proof of exemption directly to
the Department and obtain his tax receipt or exemption
determination, in which event the transaction reporting return
and tax remittance (if a tax payment was required) shall be
credited by the Department to the proper retailer's account
with the Department, but without the 2.1% or 1.75% discount
provided for in this Section being allowed. When the user pays
the tax directly to the Department, he shall pay the tax in the
same amount and in the same form in which it would be remitted
if the tax had been remitted to the Department by the retailer.
Refunds made by the seller during the preceding return
period to purchasers, on account of tangible personal property
returned to the seller, shall be allowed as a deduction under
subdivision 5 of his monthly or quarterly return, as the case
may be, in case the seller had theretofore included the
receipts from the sale of such tangible personal property in a
return filed by him and had paid the tax imposed by this Act
with respect to such receipts.
Where the seller is a corporation, the return filed on

HB4494 - 76 - LRB100 13618 HLH 28242 b
behalf of such corporation shall be signed by the president,
vice-president, secretary or treasurer or by the properly
accredited agent of such corporation.
Where the seller is a limited liability company, the return
filed on behalf of the limited liability company shall be
signed by a manager, member, or properly accredited agent of
the limited liability company.
Except as provided in this Section, the retailer filing the
return under this Section shall, at the time of filing such
return, pay to the Department the amount of tax imposed by this
Act less a discount of 2.1% prior to January 1, 1990 and 1.75%
on and after January 1, 1990, or $5 per calendar year,
whichever is greater, which is allowed to reimburse the
retailer for the expenses incurred in keeping records,
preparing and filing returns, remitting the tax and supplying
data to the Department on request. Any prepayment made pursuant
to Section 2d of this Act shall be included in the amount on
which such 2.1% or 1.75% discount is computed. In the case of
retailers who report and pay the tax on a transaction by
transaction basis, as provided in this Section, such discount
shall be taken with each such tax remittance instead of when
such retailer files his periodic return. The Department may
disallow the discount for retailers whose certificate of
registration is revoked at the time the return is filed, but
only if the Department's decision to revoke the certificate of
registration has become final.

HB4494 - 77 - LRB100 13618 HLH 28242 b
Before October 1, 2000, if the taxpayer's average monthly
tax liability to the Department under this Act, the Use Tax
Act, the Service Occupation Tax Act, and the Service Use Tax
Act, excluding any liability for prepaid sales tax to be
remitted in accordance with Section 2d of this Act, was $10,000
or more during the preceding 4 complete calendar quarters, he
shall file a return with the Department each month by the 20th
day of the month next following the month during which such tax
liability is incurred and shall make payments to the Department
on or before the 7th, 15th, 22nd and last day of the month
during which such liability is incurred. On and after October
1, 2000, if the taxpayer's average monthly tax liability to the
Department under this Act, the Use Tax Act, the Service
Occupation Tax Act, and the Service Use Tax Act, excluding any
liability for prepaid sales tax to be remitted in accordance
with Section 2d of this Act, was $20,000 or more during the
preceding 4 complete calendar quarters, he shall file a return
with the Department each month by the 20th day of the month
next following the month during which such tax liability is
incurred and shall make payment to the Department on or before
the 7th, 15th, 22nd and last day of the month during which such
liability is incurred. If the month during which such tax
liability is incurred began prior to January 1, 1985, each
payment shall be in an amount equal to 1/4 of the taxpayer's
actual liability for the month or an amount set by the
Department not to exceed 1/4 of the average monthly liability

HB4494 - 78 - LRB100 13618 HLH 28242 b
of the taxpayer to the Department for the preceding 4 complete
calendar quarters (excluding the month of highest liability and
the month of lowest liability in such 4 quarter period). If the
month during which such tax liability is incurred begins on or
after January 1, 1985 and prior to January 1, 1987, each
payment shall be in an amount equal to 22.5% of the taxpayer's
actual liability for the month or 27.5% of the taxpayer's
liability for the same calendar month of the preceding year. If
the month during which such tax liability is incurred begins on
or after January 1, 1987 and prior to January 1, 1988, each
payment shall be in an amount equal to 22.5% of the taxpayer's
actual liability for the month or 26.25% of the taxpayer's
liability for the same calendar month of the preceding year. If
the month during which such tax liability is incurred begins on
or after January 1, 1988, and prior to January 1, 1989, or
begins on or after January 1, 1996, each payment shall be in an
amount equal to 22.5% of the taxpayer's actual liability for
the month or 25% of the taxpayer's liability for the same
calendar month of the preceding year. If the month during which
such tax liability is incurred begins on or after January 1,
1989, and prior to January 1, 1996, each payment shall be in an
amount equal to 22.5% of the taxpayer's actual liability for
the month or 25% of the taxpayer's liability for the same
calendar month of the preceding year or 100% of the taxpayer's
actual liability for the quarter monthly reporting period. The
amount of such quarter monthly payments shall be credited

HB4494 - 79 - LRB100 13618 HLH 28242 b
against the final tax liability of the taxpayer's return for
that month. Before October 1, 2000, once applicable, the
requirement of the making of quarter monthly payments to the
Department by taxpayers having an average monthly tax liability
of $10,000 or more as determined in the manner provided above
shall continue until such taxpayer's average monthly liability
to the Department during the preceding 4 complete calendar
quarters (excluding the month of highest liability and the
month of lowest liability) is less than $9,000, or until such
taxpayer's average monthly liability to the Department as
computed for each calendar quarter of the 4 preceding complete
calendar quarter period is less than $10,000. However, if a
taxpayer can show the Department that a substantial change in
the taxpayer's business has occurred which causes the taxpayer
to anticipate that his average monthly tax liability for the
reasonably foreseeable future will fall below the $10,000
threshold stated above, then such taxpayer may petition the
Department for a change in such taxpayer's reporting status. On
and after October 1, 2000, once applicable, the requirement of
the making of quarter monthly payments to the Department by
taxpayers having an average monthly tax liability of $20,000 or
more as determined in the manner provided above shall continue
until such taxpayer's average monthly liability to the
Department during the preceding 4 complete calendar quarters
(excluding the month of highest liability and the month of
lowest liability) is less than $19,000 or until such taxpayer's

HB4494 - 80 - LRB100 13618 HLH 28242 b
average monthly liability to the Department as computed for
each calendar quarter of the 4 preceding complete calendar
quarter period is less than $20,000. However, if a taxpayer can
show the Department that a substantial change in the taxpayer's
business has occurred which causes the taxpayer to anticipate
that his average monthly tax liability for the reasonably
foreseeable future will fall below the $20,000 threshold stated
above, then such taxpayer may petition the Department for a
change in such taxpayer's reporting status. The Department
shall change such taxpayer's reporting status unless it finds
that such change is seasonal in nature and not likely to be
long term. If any such quarter monthly payment is not paid at
the time or in the amount required by this Section, then the
taxpayer shall be liable for penalties and interest on the
difference between the minimum amount due as a payment and the
amount of such quarter monthly payment actually and timely
paid, except insofar as the taxpayer has previously made
payments for that month to the Department in excess of the
minimum payments previously due as provided in this Section.
The Department shall make reasonable rules and regulations to
govern the quarter monthly payment amount and quarter monthly
payment dates for taxpayers who file on other than a calendar
monthly basis.
The provisions of this paragraph apply before October 1,
2001. Without regard to whether a taxpayer is required to make
quarter monthly payments as specified above, any taxpayer who

HB4494 - 81 - LRB100 13618 HLH 28242 b
is required by Section 2d of this Act to collect and remit
prepaid taxes and has collected prepaid taxes which average in
excess of $25,000 per month during the preceding 2 complete
calendar quarters, shall file a return with the Department as
required by Section 2f and shall make payments to the
Department on or before the 7th, 15th, 22nd and last day of the
month during which such liability is incurred. If the month
during which such tax liability is incurred began prior to
September 1, 1985 (the effective date of Public Act 84-221)
this amendatory Act of 1985, each payment shall be in an amount
not less than 22.5% of the taxpayer's actual liability under
Section 2d. If the month during which such tax liability is
incurred begins on or after January 1, 1986, each payment shall
be in an amount equal to 22.5% of the taxpayer's actual
liability for the month or 27.5% of the taxpayer's liability
for the same calendar month of the preceding calendar year. If
the month during which such tax liability is incurred begins on
or after January 1, 1987, each payment shall be in an amount
equal to 22.5% of the taxpayer's actual liability for the month
or 26.25% of the taxpayer's liability for the same calendar
month of the preceding year. The amount of such quarter monthly
payments shall be credited against the final tax liability of
the taxpayer's return for that month filed under this Section
or Section 2f, as the case may be. Once applicable, the
requirement of the making of quarter monthly payments to the
Department pursuant to this paragraph shall continue until such

HB4494 - 82 - LRB100 13618 HLH 28242 b
taxpayer's average monthly prepaid tax collections during the
preceding 2 complete calendar quarters is $25,000 or less. If
any such quarter monthly payment is not paid at the time or in
the amount required, the taxpayer shall be liable for penalties
and interest on such difference, except insofar as the taxpayer
has previously made payments for that month in excess of the
minimum payments previously due.
The provisions of this paragraph apply on and after October
1, 2001. Without regard to whether a taxpayer is required to
make quarter monthly payments as specified above, any taxpayer
who is required by Section 2d of this Act to collect and remit
prepaid taxes and has collected prepaid taxes that average in
excess of $20,000 per month during the preceding 4 complete
calendar quarters shall file a return with the Department as
required by Section 2f and shall make payments to the
Department on or before the 7th, 15th, 22nd and last day of the
month during which the liability is incurred. Each payment
shall be in an amount equal to 22.5% of the taxpayer's actual
liability for the month or 25% of the taxpayer's liability for
the same calendar month of the preceding year. The amount of
the quarter monthly payments shall be credited against the
final tax liability of the taxpayer's return for that month
filed under this Section or Section 2f, as the case may be.
Once applicable, the requirement of the making of quarter
monthly payments to the Department pursuant to this paragraph
shall continue until the taxpayer's average monthly prepaid tax

HB4494 - 83 - LRB100 13618 HLH 28242 b
collections during the preceding 4 complete calendar quarters
(excluding the month of highest liability and the month of
lowest liability) is less than $19,000 or until such taxpayer's
average monthly liability to the Department as computed for
each calendar quarter of the 4 preceding complete calendar
quarters is less than $20,000. If any such quarter monthly
payment is not paid at the time or in the amount required, the
taxpayer shall be liable for penalties and interest on such
difference, except insofar as the taxpayer has previously made
payments for that month in excess of the minimum payments
previously due.
If any payment provided for in this Section exceeds the
taxpayer's liabilities under this Act, the Use Tax Act, the
Service Occupation Tax Act and the Service Use Tax Act, as
shown on an original monthly return, the Department shall, if
requested by the taxpayer, issue to the taxpayer a credit
memorandum no later than 30 days after the date of payment. The
credit evidenced by such credit memorandum may be assigned by
the taxpayer to a similar taxpayer under this Act, the Use Tax
Act, the Service Occupation Tax Act or the Service Use Tax Act,
in accordance with reasonable rules and regulations to be
prescribed by the Department. If no such request is made, the
taxpayer may credit such excess payment against tax liability
subsequently to be remitted to the Department under this Act,
the Use Tax Act, the Service Occupation Tax Act or the Service
Use Tax Act, in accordance with reasonable rules and

HB4494 - 84 - LRB100 13618 HLH 28242 b
regulations prescribed by the Department. If the Department
subsequently determined that all or any part of the credit
taken was not actually due to the taxpayer, the taxpayer's 2.1%
and 1.75% vendor's discount shall be reduced by 2.1% or 1.75%
of the difference between the credit taken and that actually
due, and that taxpayer shall be liable for penalties and
interest on such difference.
If a retailer of motor fuel is entitled to a credit under
Section 2d of this Act which exceeds the taxpayer's liability
to the Department under this Act for the month which the
taxpayer is filing a return, the Department shall issue the
taxpayer a credit memorandum for the excess.
Beginning January 1, 1990, each month the Department shall
pay into the Local Government Tax Fund, a special fund in the
State treasury which is hereby created, the net revenue
realized for the preceding month from the 1% tax on sales of
food for human consumption which is to be consumed off the
premises where it is sold (other than alcoholic beverages, soft
drinks and food which has been prepared for immediate
consumption) and prescription and nonprescription medicines,
drugs, medical appliances, products classified as Class III
medical devices by the United States Food and Drug
Administration that are used for cancer treatment pursuant to a
prescription, as well as any accessories and components related
to those devices, and insulin, urine testing materials,
syringes and needles used by diabetics.

HB4494 - 85 - LRB100 13618 HLH 28242 b
Beginning January 1, 1990, each month the Department shall
pay into the County and Mass Transit District Fund, a special
fund in the State treasury which is hereby created, 4% of the
net revenue realized for the preceding month from the 6.25%
general rate.
Beginning August 1, 2000, each month the Department shall
pay into the County and Mass Transit District Fund 20% of the
net revenue realized for the preceding month from the 1.25%
rate on the selling price of motor fuel and gasohol. Beginning
September 1, 2010, and beginning again on September 1, 2018,
each month the Department shall pay into the County and Mass
Transit District Fund 20% of the net revenue realized for the
preceding month from the 1.25% rate on the selling price of
sales tax holiday items.
Beginning January 1, 1990, each month the Department shall
pay into the Local Government Tax Fund 16% of the net revenue
realized for the preceding month from the 6.25% general rate on
the selling price of tangible personal property.
Beginning August 1, 2000, each month the Department shall
pay into the Local Government Tax Fund 80% of the net revenue
realized for the preceding month from the 1.25% rate on the
selling price of motor fuel and gasohol. Beginning September 1,
2010, and beginning again on September 1, 2018, each month the
Department shall pay into the Local Government Tax Fund 80% of
the net revenue realized for the preceding month from the 1.25%
rate on the selling price of sales tax holiday items.

HB4494 - 86 - LRB100 13618 HLH 28242 b
Beginning October 1, 2009, each month the Department shall
pay into the Capital Projects Fund an amount that is equal to
an amount estimated by the Department to represent 80% of the
net revenue realized for the preceding month from the sale of
candy, grooming and hygiene products, and soft drinks that had
been taxed at a rate of 1% prior to September 1, 2009 but that
are now taxed at 6.25%.
Beginning July 1, 2011, each month the Department shall pay
into the Clean Air Act Permit Fund 80% of the net revenue
realized for the preceding month from the 6.25% general rate on
the selling price of sorbents used in Illinois in the process
of sorbent injection as used to comply with the Environmental
Protection Act or the federal Clean Air Act, but the total
payment into the Clean Air Act Permit Fund under this Act and
the Use Tax Act shall not exceed $2,000,000 in any fiscal year.
Beginning July 1, 2013, each month the Department shall pay
into the Underground Storage Tank Fund from the proceeds
collected under this Act, the Use Tax Act, the Service Use Tax
Act, and the Service Occupation Tax Act an amount equal to the
average monthly deficit in the Underground Storage Tank Fund
during the prior year, as certified annually by the Illinois
Environmental Protection Agency, but the total payment into the
Underground Storage Tank Fund under this Act, the Use Tax Act,
the Service Use Tax Act, and the Service Occupation Tax Act
shall not exceed $18,000,000 in any State fiscal year. As used
in this paragraph, the "average monthly deficit" shall be equal

HB4494 - 87 - LRB100 13618 HLH 28242 b
to the difference between the average monthly claims for
payment by the fund and the average monthly revenues deposited
into the fund, excluding payments made pursuant to this
paragraph.
Beginning July 1, 2015, of the remainder of the moneys
received by the Department under the Use Tax Act, the Service
Use Tax Act, the Service Occupation Tax Act, and this Act, each
month the Department shall deposit $500,000 into the State
Crime Laboratory Fund.
Of the remainder of the moneys received by the Department
pursuant to this Act, (a) 1.75% thereof shall be paid into the
Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on
and after July 1, 1989, 3.8% thereof shall be paid into the
Build Illinois Fund; provided, however, that if in any fiscal
year the sum of (1) the aggregate of 2.2% or 3.8%, as the case
may be, of the moneys received by the Department and required
to be paid into the Build Illinois Fund pursuant to this Act,
Section 9 of the Use Tax Act, Section 9 of the Service Use Tax
Act, and Section 9 of the Service Occupation Tax Act, such Acts
being hereinafter called the "Tax Acts" and such aggregate of
2.2% or 3.8%, as the case may be, of moneys being hereinafter
called the "Tax Act Amount", and (2) the amount transferred to
the Build Illinois Fund from the State and Local Sales Tax
Reform Fund shall be less than the Annual Specified Amount (as
hereinafter defined), an amount equal to the difference shall
be immediately paid into the Build Illinois Fund from other

HB4494 - 88 - LRB100 13618 HLH 28242 b
moneys received by the Department pursuant to the Tax Acts; the
"Annual Specified Amount" means the amounts specified below for
fiscal years 1986 through 1993:
Fiscal Year Annual Specified Amount
1986 $54,800,000
1987 $76,650,000
1988 $80,480,000
1989 $88,510,000
1990 $115,330,000
1991 $145,470,000
1992 $182,730,000
1993 $206,520,000;
and means the Certified Annual Debt Service Requirement (as
defined in Section 13 of the Build Illinois Bond Act) or the
Tax Act Amount, whichever is greater, for fiscal year 1994 and
each fiscal year thereafter; and further provided, that if on
the last business day of any month the sum of (1) the Tax Act
Amount required to be deposited into the Build Illinois Bond
Account in the Build Illinois Fund during such month and (2)
the amount transferred to the Build Illinois Fund from the
State and Local Sales Tax Reform Fund shall have been less than
1/12 of the Annual Specified Amount, an amount equal to the
difference shall be immediately paid into the Build Illinois
Fund from other moneys received by the Department pursuant to
the Tax Acts; and, further provided, that in no event shall the
payments required under the preceding proviso result in

HB4494 - 89 - LRB100 13618 HLH 28242 b
aggregate payments into the Build Illinois Fund pursuant to
this clause (b) for any fiscal year in excess of the greater of
(i) the Tax Act Amount or (ii) the Annual Specified Amount for
such fiscal year. The amounts payable into the Build Illinois
Fund under clause (b) of the first sentence in this paragraph
shall be payable only until such time as the aggregate amount
on deposit under each trust indenture securing Bonds issued and
outstanding pursuant to the Build Illinois Bond Act is
sufficient, taking into account any future investment income,
to fully provide, in accordance with such indenture, for the
defeasance of or the payment of the principal of, premium, if
any, and interest on the Bonds secured by such indenture and on
any Bonds expected to be issued thereafter and all fees and
costs payable with respect thereto, all as certified by the
Director of the Bureau of the Budget (now Governor's Office of
Management and Budget). If on the last business day of any
month in which Bonds are outstanding pursuant to the Build
Illinois Bond Act, the aggregate of moneys deposited in the
Build Illinois Bond Account in the Build Illinois Fund in such
month shall be less than the amount required to be transferred
in such month from the Build Illinois Bond Account to the Build
Illinois Bond Retirement and Interest Fund pursuant to Section
13 of the Build Illinois Bond Act, an amount equal to such
deficiency shall be immediately paid from other moneys received
by the Department pursuant to the Tax Acts to the Build
Illinois Fund; provided, however, that any amounts paid to the

HB4494 - 90 - LRB100 13618 HLH 28242 b
Build Illinois Fund in any fiscal year pursuant to this
sentence shall be deemed to constitute payments pursuant to
clause (b) of the first sentence of this paragraph and shall
reduce the amount otherwise payable for such fiscal year
pursuant to that clause (b). The moneys received by the
Department pursuant to this Act and required to be deposited
into the Build Illinois Fund are subject to the pledge, claim
and charge set forth in Section 12 of the Build Illinois Bond
Act.
Subject to payment of amounts into the Build Illinois Fund
as provided in the preceding paragraph or in any amendment
thereto hereafter enacted, the following specified monthly
installment of the amount requested in the certificate of the
Chairman of the Metropolitan Pier and Exposition Authority
provided under Section 8.25f of the State Finance Act, but not
in excess of sums designated as "Total Deposit", shall be
deposited in the aggregate from collections under Section 9 of
the Use Tax Act, Section 9 of the Service Use Tax Act, Section
9 of the Service Occupation Tax Act, and Section 3 of the
Retailers' Occupation Tax Act into the McCormick Place
Expansion Project Fund in the specified fiscal years.
Fiscal Year Total Deposit
1993 $0
1994 53,000,000
1995 58,000,000

HB4494 - 91 - LRB100 13618 HLH 28242 b
1996 61,000,000
1997 64,000,000
1998 68,000,000
1999 71,000,000
2000 75,000,000
2001 80,000,000
2002 93,000,000
2003 99,000,000
2004 103,000,000
2005 108,000,000
2006 113,000,000
2007 119,000,000
2008 126,000,000
2009 132,000,000
2010 139,000,000
2011 146,000,000
2012 153,000,000
2013 161,000,000
2014 170,000,000
2015 179,000,000
2016 189,000,000
2017 199,000,000
2018 210,000,000
2019 221,000,000
2020 233,000,000
2021 246,000,000

HB4494 - 92 - LRB100 13618 HLH 28242 b
2022 260,000,000
2023 275,000,000
2024 275,000,000
2025 275,000,000
2026 279,000,000
2027 292,000,000
2028 307,000,000
2029 322,000,000
2030 338,000,000
2031 350,000,000
2032 350,000,000
and
each fiscal year
thereafter that bonds
are outstanding under
Section 13.2 of the
Metropolitan Pier and
Exposition Authority Act,
but not after fiscal year 2060.
Beginning July 20, 1993 and in each month of each fiscal
year thereafter, one-eighth of the amount requested in the
certificate of the Chairman of the Metropolitan Pier and
Exposition Authority for that fiscal year, less the amount
deposited into the McCormick Place Expansion Project Fund by
the State Treasurer in the respective month under subsection
(g) of Section 13 of the Metropolitan Pier and Exposition

HB4494 - 93 - LRB100 13618 HLH 28242 b
Authority Act, plus cumulative deficiencies in the deposits
required under this Section for previous months and years,
shall be deposited into the McCormick Place Expansion Project
Fund, until the full amount requested for the fiscal year, but
not in excess of the amount specified above as "Total Deposit",
has been deposited.
Subject to payment of amounts into the Build Illinois Fund
and the McCormick Place Expansion Project Fund pursuant to the
preceding paragraphs or in any amendments thereto hereafter
enacted, beginning July 1, 1993 and ending on September 30,
2013, the Department shall each month pay into the Illinois Tax
Increment Fund 0.27% of 80% of the net revenue realized for the
preceding month from the 6.25% general rate on the selling
price of tangible personal property.
Subject to payment of amounts into the Build Illinois Fund
and the McCormick Place Expansion Project Fund pursuant to the
preceding paragraphs or in any amendments thereto hereafter
enacted, beginning with the receipt of the first report of
taxes paid by an eligible business and continuing for a 25-year
period, the Department shall each month pay into the Energy
Infrastructure Fund 80% of the net revenue realized from the
6.25% general rate on the selling price of Illinois-mined coal
that was sold to an eligible business. For purposes of this
paragraph, the term "eligible business" means a new electric
generating facility certified pursuant to Section 605-332 of
the Department of Commerce and Economic Opportunity Law of the

HB4494 - 94 - LRB100 13618 HLH 28242 b
Civil Administrative Code of Illinois.
Subject to payment of amounts into the Build Illinois Fund,
the McCormick Place Expansion Project Fund, the Illinois Tax
Increment Fund, and the Energy Infrastructure Fund pursuant to
the preceding paragraphs or in any amendments to this Section
hereafter enacted, beginning on the first day of the first
calendar month to occur on or after August 26, 2014 (the
effective date of Public Act 98-1098) this amendatory Act of
the 98th General Assembly, each month, from the collections
made under Section 9 of the Use Tax Act, Section 9 of the
Service Use Tax Act, Section 9 of the Service Occupation Tax
Act, and Section 3 of the Retailers' Occupation Tax Act, the
Department shall pay into the Tax Compliance and Administration
Fund, to be used, subject to appropriation, to fund additional
auditors and compliance personnel at the Department of Revenue,
an amount equal to 1/12 of 5% of 80% of the cash receipts
collected during the preceding fiscal year by the Audit Bureau
of the Department under the Use Tax Act, the Service Use Tax
Act, the Service Occupation Tax Act, the Retailers' Occupation
Tax Act, and associated local occupation and use taxes
administered by the Department.
Of the remainder of the moneys received by the Department
pursuant to this Act, 75% thereof shall be paid into the State
Treasury and 25% shall be reserved in a special account and
used only for the transfer to the Common School Fund as part of
the monthly transfer from the General Revenue Fund in

HB4494 - 95 - LRB100 13618 HLH 28242 b
accordance with Section 8a of the State Finance Act.
The Department may, upon separate written notice to a
taxpayer, require the taxpayer to prepare and file with the
Department on a form prescribed by the Department within not
less than 60 days after receipt of the notice an annual
information return for the tax year specified in the notice.
Such annual return to the Department shall include a statement
of gross receipts as shown by the retailer's last Federal
income tax return. If the total receipts of the business as
reported in the Federal income tax return do not agree with the
gross receipts reported to the Department of Revenue for the
same period, the retailer shall attach to his annual return a
schedule showing a reconciliation of the 2 amounts and the
reasons for the difference. The retailer's annual return to the
Department shall also disclose the cost of goods sold by the
retailer during the year covered by such return, opening and
closing inventories of such goods for such year, costs of goods
used from stock or taken from stock and given away by the
retailer during such year, payroll information of the
retailer's business during such year and any additional
reasonable information which the Department deems would be
helpful in determining the accuracy of the monthly, quarterly
or annual returns filed by such retailer as provided for in
this Section.
If the annual information return required by this Section
is not filed when and as required, the taxpayer shall be liable

HB4494 - 96 - LRB100 13618 HLH 28242 b
as follows:
(i) Until January 1, 1994, the taxpayer shall be liable
for a penalty equal to 1/6 of 1% of the tax due from such
taxpayer under this Act during the period to be covered by
the annual return for each month or fraction of a month
until such return is filed as required, the penalty to be
assessed and collected in the same manner as any other
penalty provided for in this Act.
(ii) On and after January 1, 1994, the taxpayer shall
be liable for a penalty as described in Section 3-4 of the
Uniform Penalty and Interest Act.
The chief executive officer, proprietor, owner or highest
ranking manager shall sign the annual return to certify the
accuracy of the information contained therein. Any person who
willfully signs the annual return containing false or
inaccurate information shall be guilty of perjury and punished
accordingly. The annual return form prescribed by the
Department shall include a warning that the person signing the
return may be liable for perjury.
The provisions of this Section concerning the filing of an
annual information return do not apply to a retailer who is not
required to file an income tax return with the United States
Government.
As soon as possible after the first day of each month, upon
certification of the Department of Revenue, the Comptroller
shall order transferred and the Treasurer shall transfer from

HB4494 - 97 - LRB100 13618 HLH 28242 b
the General Revenue Fund to the Motor Fuel Tax Fund an amount
equal to 1.7% of 80% of the net revenue realized under this Act
for the second preceding month. Beginning April 1, 2000, this
transfer is no longer required and shall not be made.
Net revenue realized for a month shall be the revenue
collected by the State pursuant to this Act, less the amount
paid out during that month as refunds to taxpayers for
overpayment of liability.
For greater simplicity of administration, manufacturers,
importers and wholesalers whose products are sold at retail in
Illinois by numerous retailers, and who wish to do so, may
assume the responsibility for accounting and paying to the
Department all tax accruing under this Act with respect to such
sales, if the retailers who are affected do not make written
objection to the Department to this arrangement.
Any person who promotes, organizes, provides retail
selling space for concessionaires or other types of sellers at
the Illinois State Fair, DuQuoin State Fair, county fairs,
local fairs, art shows, flea markets and similar exhibitions or
events, including any transient merchant as defined by Section
2 of the Transient Merchant Act of 1987, is required to file a
report with the Department providing the name of the merchant's
business, the name of the person or persons engaged in
merchant's business, the permanent address and Illinois
Retailers Occupation Tax Registration Number of the merchant,
the dates and location of the event and other reasonable

HB4494 - 98 - LRB100 13618 HLH 28242 b
information that the Department may require. The report must be
filed not later than the 20th day of the month next following
the month during which the event with retail sales was held.
Any person who fails to file a report required by this Section
commits a business offense and is subject to a fine not to
exceed $250.
Any person engaged in the business of selling tangible
personal property at retail as a concessionaire or other type
of seller at the Illinois State Fair, county fairs, art shows,
flea markets and similar exhibitions or events, or any
transient merchants, as defined by Section 2 of the Transient
Merchant Act of 1987, may be required to make a daily report of
the amount of such sales to the Department and to make a daily
payment of the full amount of tax due. The Department shall
impose this requirement when it finds that there is a
significant risk of loss of revenue to the State at such an
exhibition or event. Such a finding shall be based on evidence
that a substantial number of concessionaires or other sellers
who are not residents of Illinois will be engaging in the
business of selling tangible personal property at retail at the
exhibition or event, or other evidence of a significant risk of
loss of revenue to the State. The Department shall notify
concessionaires and other sellers affected by the imposition of
this requirement. In the absence of notification by the
Department, the concessionaires and other sellers shall file
their returns as otherwise required in this Section.

HB4494 - 99 - LRB100 13618 HLH 28242 b
(Source: P.A. 98-24, eff. 6-19-13; 98-109, eff. 7-25-13;
98-496, eff. 1-1-14; 98-756, eff. 7-16-14; 98-1098, eff.
8-26-14; 99-352, eff. 8-12-15; 99-858, eff. 8-19-16; 99-933,
eff. 1-27-17; revised 2-3-17.)
Section 99. Effective date. This Act takes effect upon
becoming law.