Illinois sales & use tax.
The facts an advisor checks first — rate, nexus threshold, marketplace rules — with links to the controlling authority. Illinois administers its tax as a Retailers’ Occupation Tax (ROT), which changes more than the name.
Illinois: rate, nexus & administration.
- State Retailers’ Occupation Tax (ROT) rate
- 6.25%
- Local rates
- Local rates stack to 10.25% or more in Chicago
- Economic nexus
- $100,000 in sales · effective October 1, 2018The 200-transaction threshold was repealed effective January 1, 2026.Controlling authority: 35 ILCS 105/2 ↗
- Marketplace facilitator
- Yes — effective January 1, 2020
- Streamlined (SST)
- Not a member
- Administered by
- Illinois Department of Revenue ↗
What to watch in Illinois
- Sourcing is unusually intricate: since January 1, 2025, out-of-state retailers with Illinois physical presence must destination-source, joining remote retailers.
- The state 1% grocery tax was repealed effective January 1, 2026, but municipalities may impose their own 1% in its place.
- SaaS is generally not taxable at the state level — but Chicago’s Personal Property Lease Transaction Tax reaches cloud software for city users.
Rates, thresholds, and taxability change mid-year — verify against the Illinois Department of Revenue before advising. In L3i, every determination is cited to the controlling authority.
The Illinois voluntary disclosure agreement.
Behind in Illinois? There’s a front door. The voluntary disclosure program lets a business settle unregistered-period exposure on defined terms — before the state finds it first. The terms that shape the client conversation:
Administered by the Illinois Department of Revenue ↗. Program terms as of February 2026 — confirm current terms before filing. L3i pairs the exposure math with the filing itself — see exposure analysis & VDA services.
Illinois, in brief.
What is the economic nexus threshold in Illinois?
$100,000 in sales, effective October 1, 2018. The 200-transaction threshold was repealed effective January 1, 2026. Once the threshold is crossed, remote sellers must register with the Illinois Department of Revenue and begin collecting.
What is the sales tax rate in Illinois?
The state Retailers’ Occupation Tax (ROT) rate is 6.25%. Local rates stack to 10.25% or more in Chicago.
Do marketplace facilitators collect Illinois sales tax?
Yes — marketplace facilitators have been required to collect since January 1, 2020. Direct (non-marketplace) sales remain the seller’s obligation.
How does a remote seller register for Illinois sales tax?
Register with the Illinois Department of Revenue before collecting — a remote seller must register once it crosses the economic nexus threshold ($100,000 in sales).
Does Illinois offer a voluntary disclosure agreement (VDA)?
Yes — the Illinois Department of Revenue administers a voluntary disclosure program with a lookback of 48 months (4 years). Penalties are generally waived; interest is generally still due. An advisor can approach the state anonymously before disclosing the client’s identity.
A page tells you the rule. The platform applies it — and remembers why.
L3i runs Illinois determinations against a deterministic rules engine, cites the controlling authority, and captures your firm’s judgment so the next Illinois question starts further ahead.
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