Bill Text: IL SB2422 | 2015-2016 | 99th General Assembly | Introduced

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Bill Title: Amends the Service Occupation Tax Act. Makes a technical change in a Section concerning rolling stock.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2016-02-09 - Referred to Assignments [SB2422 Detail]

Download: Illinois-2015-SB2422-Introduced.html

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99TH GENERAL ASSEMBLY State of Illinois 2015 and 2016 SB2422 Introduced 2/9/2016, by Sen. Sue Rezin SYNOPSIS AS INTRODUCED:
35 ILCS 115/2d
Amends the Service Occupation Tax Act. Makes a technical change in a Section concerning rolling stock.
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A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Service Occupation Tax Act is amended by
changing Section 2d as follows:
(35 ILCS 115/2d)
Sec. 2d. Motor vehicles; trailers; use as rolling stock
definition.
(a) Through June 30, 2003, "use as as rolling stock moving
in interstate commerce" in subsections (d) and (d-1) of the
definition of "sale of service" in Section 2 means for motor
vehicles, as defined in Section 1-146 of the Illinois Vehicle
Code, and trailers, as defined in Section 1-209 of the Illinois
Vehicle Code, when on 15 or more occasions in a 12-month period
the motor vehicle and trailer has carried persons or property
for hire in interstate commerce, even just between points in
Illinois, if the motor vehicle and trailer transports persons
whose journeys or property whose shipments originate or
terminate outside Illinois. This definition applies to all
property purchased for the purpose of being attached to those
motor vehicles or trailers as a part thereof.
(b) On and after July 1, 2003 and through June 30, 2004,
"use as rolling stock moving in interstate commerce" in

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paragraphs (d) and (d-1) of the definition of "sale of service"
in Section 2 occurs for motor vehicles, as defined in Section
1-146 of the Illinois Vehicle Code, when during a 12-month
period the rolling stock has carried persons or property for
hire in interstate commerce for 51% of its total trips and
transports persons whose journeys or property whose shipments
originate or terminate outside Illinois. Trips that are only
between points in Illinois will not be counted as interstate
trips when calculating whether the tangible personal property
qualifies for the exemption but such trips will be included in
total trips taken.
(c) Beginning July 1, 2004, "use as rolling stock moving in
interstate commerce" in paragraphs (d) and (d-1) of the
definition of "sale of service" in Section 2 occurs for motor
vehicles, as defined in Section 1-146 of the Illinois Vehicle
Code, when during a 12-month period the rolling stock has
carried persons or property for hire in interstate commerce for
greater than 50% of its total trips for that period or for
greater than 50% of its total miles for that period. The person
claiming the exemption shall make an election at the time of
purchase to use either the trips or mileage method. Persons who
purchased motor vehicles prior to July 1, 2004 shall make an
election to use either the trips or mileage method and document
that election in their books and records. If no election is
made under this subsection to use the trips or mileage method,
the person shall be deemed to have chosen the mileage method.

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For purposes of determining qualifying trips or miles,
motor vehicles that carry persons or property for hire, even
just between points in Illinois, will be considered used for
hire in interstate commerce if the motor vehicle transports
persons whose journeys or property whose shipments originate or
terminate outside Illinois. The exemption for motor vehicles
used as rolling stock moving in interstate commerce may be
claimed only for the following vehicles: (i) motor vehicles
whose gross vehicle weight rating exceeds 16,000 pounds; and
(ii) limousines, as defined in Section 1-139.1 of the Illinois
Vehicle Code. This definition applies to all property purchased
for the purpose of being attached to those motor vehicles as a
part thereof.
(d) Beginning July 1, 2004, "use as rolling stock moving in
interstate commerce" in paragraphs (d) and (d-1) of the
definition of "sale of service" in Section 2 occurs for
trailers, as defined in Section 1-209 of the Illinois Vehicle
Code, semitrailers as defined in Section 1-187 of the Illinois
Vehicle Code, and pole trailers as defined in Section 1-161 of
the Illinois Vehicle Code, when during a 12-month period the
rolling stock has carried persons or property for hire in
interstate commerce for greater than 50% of its total trips for
that period or for greater than 50% of its total miles for that
period. The person claiming the exemption for a trailer or
trailers that will not be dedicated to a motor vehicle or group
of motor vehicles shall make an election at the time of

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purchase to use either the trips or mileage method. Persons who
purchased trailers prior to July 1, 2004 that are not dedicated
to a motor vehicle or group of motor vehicles shall make an
election to use either the trips or mileage method and document
that election in their books and records. If no election is
made under this subsection to use the trips or mileage method,
the person shall be deemed to have chosen the mileage method.
For purposes of determining qualifying trips or miles,
trailers, semitrailers, or pole trailers that carry property
for hire, even just between points in Illinois, will be
considered used for hire in interstate commerce if the
trailers, semitrailers, or pole trailers transport property
whose shipments originate or terminate outside Illinois. This
definition applies to all property purchased for the purpose of
being attached to those trailers, semitrailers, or pole
trailers as a part thereof. In lieu of a person providing
documentation regarding the qualifying use of each individual
trailer, semitrailer, or pole trailer, that person may document
such qualifying use by providing documentation of the
following:
(1) If a trailer, semitrailer, or pole trailer is
dedicated to a motor vehicle that qualifies as rolling
stock moving in interstate commerce under subsection (c) of
this Section, then that trailer, semitrailer, or pole
trailer qualifies as rolling stock moving in interstate
commerce under this subsection.

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(2) If a trailer, semitrailer, or pole trailer is
dedicated to a group of motor vehicles that all qualify as
rolling stock moving in interstate commerce under
subsection (c) of this Section, then that trailer,
semitrailer, or pole trailer qualifies as rolling stock
moving in interstate commerce under this subsection.
(3) If one or more trailers, semitrailers, or pole
trailers are dedicated to a group of motor vehicles and not
all of those motor vehicles in that group qualify as
rolling stock moving in interstate commerce under
subsection (c) of this Section, then the percentage of
those trailers, semitrailers, or pole trailers that
qualifies as rolling stock moving in interstate commerce
under this subsection is equal to the percentage of those
motor vehicles in that group that qualify as rolling stock
moving in interstate commerce under subsection (c) of this
Section to which those trailers, semitrailers, or pole
trailers are dedicated. However, to determine the
qualification for the exemption provided under this item
(3), the mathematical application of the qualifying
percentage to one or more trailers, semitrailers, or pole
trailers under this subpart shall not be allowed as to any
fraction of a trailer, semitrailer, or pole trailer.
(e) For aircraft and watercraft purchased on or after
January 1 2014, "use as rolling stock moving in interstate
commerce" in paragraphs (d) and (d-1) of the definition of

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"sale of service" in Section 2 occurs when, during a 12-month
period, the rolling stock has carried persons or property for
hire in interstate commerce for greater than 50% of its total
trips for that period or for greater than 50% of its total
miles for that period. The person claiming the exemption shall
make an election at the time of purchase to use either the
trips or mileage method and document that election in their
books and records. If no election is made under this subsection
to use the trips or mileage method, the person shall be deemed
to have chosen the mileage method. For aircraft, flight hours
may be used in lieu of recording miles in determining whether
the aircraft meets the mileage test in this subsection. For
watercraft, nautical miles or trip hours may be used in lieu of
recording miles in determining whether the watercraft meets the
mileage test in this subsection.
Notwithstanding any other provision of law to the contrary,
property purchased on or after January 1, 2014 for the purpose
of being attached to aircraft or watercraft as a part thereof
qualifies as rolling stock moving in interstate commerce only
if the aircraft or watercraft to which it will be attached
qualifies as rolling stock moving in interstate commerce under
the test set forth in this subsection (e), regardless of when
the aircraft or watercraft was purchased. Persons who purchased
aircraft or watercraft prior to January 1, 2014 shall make an
election to use either the trips or mileage method and document
that election in their books and records for the purpose of

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determining whether property purchased on or after January 1,
2014 for the purpose of being attached to aircraft or
watercraft as a part thereof qualifies as rolling stock moving
in interstate commerce under this subsection (e).
(f) The election to use either the trips or mileage method
made under the provisions of subsections (c), (d), or (e) of
this Section will remain in effect for the duration of the
purchaser's ownership of that item.
(Source: P.A. 98-584, eff. 8-27-13.)