Full Text of HB3092 99th General Assembly
HB3092 99TH GENERAL ASSEMBLY |
| | 99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016 HB3092 Introduced , by Rep. Tom Demmer SYNOPSIS AS INTRODUCED: |
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35 ILCS 105/2 | from Ch. 120, par. 439.2 |
35 ILCS 110/2 | from Ch. 120, par. 439.32 |
35 ILCS 115/2 | from Ch. 120, par. 439.102 |
35 ILCS 120/1 | from Ch. 120, par. 440 |
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Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that a not-for-profit organization that (i) has received an exemption under Section 501(c)(3) of the Internal Revenue Code, (ii) has gross receipts of no more than $10,000 per year, and (iii) is organized and operated exclusively for charitable, religious, or educational purposes is not considered a retailer or a serviceman. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
| | A BILL FOR |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Use Tax Act is amended by changing Section 2 | 5 | | as follows:
| 6 | | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
| 7 | | Sec. 2. Definitions. | 8 | | "Use" means the exercise by any person of any right or | 9 | | power over
tangible personal property incident to the ownership | 10 | | of that property,
except that it does not include the sale of | 11 | | such property in any form as
tangible personal property in the | 12 | | regular course of business to the extent
that such property is | 13 | | not first subjected to a use for which it was
purchased, and | 14 | | does not include the use of such property by its owner for
| 15 | | demonstration purposes: Provided that the property purchased | 16 | | is deemed to
be purchased for the purpose of resale, despite | 17 | | first being used, to the
extent to which it is resold as an | 18 | | ingredient of an intentionally produced
product or by-product | 19 | | of manufacturing. "Use" does not mean the demonstration
use or | 20 | | interim use of tangible personal property by a retailer before | 21 | | he sells
that tangible personal property. For watercraft or | 22 | | aircraft, if the period of
demonstration use or interim use by | 23 | | the retailer exceeds 18 months,
the retailer
shall pay on the |
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| 1 | | retailers' original cost price the tax imposed by this Act,
and | 2 | | no credit for that tax is permitted if the watercraft or | 3 | | aircraft is
subsequently sold by the retailer. "Use" does not | 4 | | mean the physical
incorporation of tangible personal property, | 5 | | to the extent not first subjected
to a use for which it was | 6 | | purchased, as an ingredient or constituent, into
other tangible | 7 | | personal property (a) which is sold in the regular course of
| 8 | | business or (b) which the person incorporating such ingredient | 9 | | or constituent
therein has undertaken at the time of such | 10 | | purchase to cause to be transported
in interstate commerce to | 11 | | destinations outside the State of Illinois: Provided
that the | 12 | | property purchased is deemed to be purchased for the purpose of
| 13 | | resale, despite first being used, to the extent to which it is | 14 | | resold as an
ingredient of an intentionally produced product or | 15 | | by-product of manufacturing.
| 16 | | "Watercraft" means a Class 2, Class 3, or Class 4 | 17 | | watercraft as defined in
Section 3-2 of the Boat Registration | 18 | | and Safety Act, a personal watercraft, or
any boat equipped | 19 | | with an inboard motor.
| 20 | | "Purchase at retail" means the acquisition of the ownership | 21 | | of or title
to tangible personal property through a sale at | 22 | | retail.
| 23 | | "Purchaser" means anyone who, through a sale at retail, | 24 | | acquires the
ownership of tangible personal property for a | 25 | | valuable consideration.
| 26 | | "Sale at retail" means any transfer of the ownership of or |
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| 1 | | title to
tangible personal property to a purchaser, for the | 2 | | purpose of use, and not
for the purpose of resale in any form | 3 | | as tangible personal property to the
extent not first subjected | 4 | | to a use for which it was purchased, for a
valuable | 5 | | consideration: Provided that the property purchased is deemed | 6 | | to
be purchased for the purpose of resale, despite first being | 7 | | used, to the
extent to which it is resold as an ingredient of | 8 | | an intentionally produced
product or by-product of | 9 | | manufacturing. For this purpose, slag produced as
an incident | 10 | | to manufacturing pig iron or steel and sold is considered to be
| 11 | | an intentionally produced by-product of manufacturing. "Sale | 12 | | at retail"
includes any such transfer made for resale unless | 13 | | made in compliance with
Section 2c of the Retailers' Occupation | 14 | | Tax Act, as incorporated by
reference into Section 12 of this | 15 | | Act. Transactions whereby the possession
of the property is | 16 | | transferred but the seller retains the title as security
for | 17 | | payment of the selling price are sales.
| 18 | | "Sale at retail" shall also be construed to include any | 19 | | Illinois
florist's sales transaction in which the purchase | 20 | | order is received in
Illinois by a florist and the sale is for | 21 | | use or consumption, but the
Illinois florist has a florist in | 22 | | another state deliver the property to the
purchaser or the | 23 | | purchaser's donee in such other state.
| 24 | | Nonreusable tangible personal property that is used by | 25 | | persons engaged in
the business of operating a restaurant, | 26 | | cafeteria, or drive-in is a sale for
resale when it is |
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| 1 | | transferred to customers in the ordinary course of business
as | 2 | | part of the sale of food or beverages and is used to deliver, | 3 | | package, or
consume food or beverages, regardless of where | 4 | | consumption of the food or
beverages occurs. Examples of those | 5 | | items include, but are not limited to
nonreusable, paper and | 6 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | 7 | | containers, utensils, straws, placemats, napkins, doggie bags, | 8 | | and
wrapping or packaging
materials that are transferred to | 9 | | customers as part of the sale of food or
beverages in the | 10 | | ordinary course of business.
| 11 | | The purchase, employment and transfer of such tangible | 12 | | personal property
as newsprint and ink for the primary purpose | 13 | | of conveying news (with or
without other information) is not a | 14 | | purchase, use or sale of tangible
personal property.
| 15 | | "Selling price" means the consideration for a sale valued | 16 | | in money
whether received in money or otherwise, including | 17 | | cash, credits, property
other than as hereinafter provided, and | 18 | | services, but not including the
value of or credit given for | 19 | | traded-in tangible personal property where the
item that is | 20 | | traded-in is of like kind and character as that which is being
| 21 | | sold, and shall be determined without any deduction on account | 22 | | of the cost
of the property sold, the cost of materials used, | 23 | | labor or service cost or
any other expense whatsoever, but does | 24 | | not include interest or finance
charges which appear as | 25 | | separate items on the bill of sale or sales
contract nor | 26 | | charges that are added to prices by sellers on account of the
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| 1 | | seller's tax liability under the "Retailers' Occupation Tax | 2 | | Act", or on
account of the seller's duty to collect, from the | 3 | | purchaser, the tax that
is imposed by this Act, or, except as | 4 | | otherwise provided with respect to any cigarette tax imposed by | 5 | | a home rule unit, on account of the seller's tax liability | 6 | | under any local occupation tax administered by the Department, | 7 | | or, except as otherwise provided with respect to any cigarette | 8 | | tax imposed by a home rule unit on account of the seller's duty | 9 | | to collect, from the purchasers, the tax that is imposed under | 10 | | any local use tax administered by the Department. Effective | 11 | | December 1, 1985, "selling price"
shall include charges that | 12 | | are added to prices by sellers on account of the
seller's tax | 13 | | liability under the Cigarette Tax Act, on account of the | 14 | | seller's
duty to collect, from the purchaser, the tax imposed | 15 | | under the Cigarette Use
Tax Act, and on account of the seller's | 16 | | duty to collect, from the purchaser,
any cigarette tax imposed | 17 | | by a home rule unit.
| 18 | | Notwithstanding any law to the contrary, for any motor | 19 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that | 20 | | is sold on or after January 1, 2015 for the purpose of leasing | 21 | | the vehicle for a defined period that is longer than one year | 22 | | and (1) is a motor vehicle of the second division that: (A) is | 23 | | a self-contained motor vehicle designed or permanently | 24 | | converted to provide living quarters for recreational, | 25 | | camping, or travel use, with direct walk through access to the | 26 | | living quarters from the driver's seat; (B) is of the van |
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| 1 | | configuration designed for the transportation of not less than | 2 | | 7 nor more than 16 passengers; or (C) has a gross vehicle | 3 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle | 4 | | of the first division, "selling price" or "amount of sale" | 5 | | means the consideration received by the lessor pursuant to the | 6 | | lease contract, including amounts due at lease signing and all | 7 | | monthly or other regular payments charged over the term of the | 8 | | lease. Also included in the selling price is any amount | 9 | | received by the lessor from the lessee for the leased vehicle | 10 | | that is not calculated at the time the lease is executed, | 11 | | including, but not limited to, excess mileage charges and | 12 | | charges for excess wear and tear. For sales that occur in | 13 | | Illinois, with respect to any amount received by the lessor | 14 | | from the lessee for the leased vehicle that is not calculated | 15 | | at the time the lease is executed, the lessor who purchased the | 16 | | motor vehicle does not incur the tax imposed by the Use Tax Act | 17 | | on those amounts, and the retailer who makes the retail sale of | 18 | | the motor vehicle to the lessor is not required to collect the | 19 | | tax imposed by this Act or to pay the tax imposed by the | 20 | | Retailers' Occupation Tax Act on those amounts. However, the | 21 | | lessor who purchased the motor vehicle assumes the liability | 22 | | for reporting and paying the tax on those amounts directly to | 23 | | the Department in the same form (Illinois Retailers' Occupation | 24 | | Tax, and local retailers' occupation taxes, if applicable) in | 25 | | which the retailer would have reported and paid such tax if the | 26 | | retailer had accounted for the tax to the Department. For |
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| 1 | | amounts received by the lessor from the lessee that are not | 2 | | calculated at the time the lease is executed, the lessor must | 3 | | file the return and pay the tax to the Department by the due | 4 | | date otherwise required by this Act for returns other than | 5 | | transaction returns. If the retailer is entitled under this Act | 6 | | to a discount for collecting and remitting the tax imposed | 7 | | under this Act to the Department with respect to the sale of | 8 | | the motor vehicle to the lessor, then the right to the discount | 9 | | provided in this Act shall be transferred to the lessor with | 10 | | respect to the tax paid by the lessor for any amount received | 11 | | by the lessor from the lessee for the leased vehicle that is | 12 | | not calculated at the time the lease is executed; provided that | 13 | | the discount is only allowed if the return is timely filed and | 14 | | for amounts timely paid. The "selling price" of a motor vehicle | 15 | | that is sold on or after January 1, 2015 for the purpose of | 16 | | leasing for a defined period of longer than one year shall not | 17 | | be reduced by the value of or credit given for traded-in | 18 | | tangible personal property owned by the lessor, nor shall it be | 19 | | reduced by the value of or credit given for traded-in tangible | 20 | | personal property owned by the lessee, regardless of whether | 21 | | the trade-in value thereof is assigned by the lessee to the | 22 | | lessor. In the case of a motor vehicle that is sold for the | 23 | | purpose of leasing for a defined period of longer than one | 24 | | year, the sale occurs at the time of the delivery of the | 25 | | vehicle, regardless of the due date of any lease payments. A | 26 | | lessor who incurs a Retailers' Occupation Tax liability on the |
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| 1 | | sale of a motor vehicle coming off lease may not take a credit | 2 | | against that liability for the Use Tax the lessor paid upon the | 3 | | purchase of the motor vehicle (or for any tax the lessor paid | 4 | | with respect to any amount received by the lessor from the | 5 | | lessee for the leased vehicle that was not calculated at the | 6 | | time the lease was executed) if the selling price of the motor | 7 | | vehicle at the time of purchase was calculated using the | 8 | | definition of "selling price" as defined in this paragraph. | 9 | | Notwithstanding any other provision of this Act to the | 10 | | contrary, lessors shall file all returns and make all payments | 11 | | required under this paragraph to the Department by electronic | 12 | | means in the manner and form as required by the Department. | 13 | | This paragraph does not apply to leases of motor vehicles for | 14 | | which, at the time the lease is entered into, the term of the | 15 | | lease is not a defined period, including leases with a defined | 16 | | initial period with the option to continue the lease on a | 17 | | month-to-month or other basis beyond the initial defined | 18 | | period. | 19 | | The phrase "like kind and character" shall be liberally | 20 | | construed
(including but not limited to any form of motor | 21 | | vehicle for any form of
motor vehicle, or any kind of farm or | 22 | | agricultural implement for any other
kind of farm or | 23 | | agricultural implement), while not including a kind of item
| 24 | | which, if sold at retail by that retailer, would be exempt from | 25 | | retailers'
occupation tax and use tax as an isolated or | 26 | | occasional sale.
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| 1 | | "Department" means the Department of Revenue.
| 2 | | "Person" means any natural individual, firm, partnership, | 3 | | association,
joint stock company, joint adventure, public or | 4 | | private corporation, limited
liability company, or a
receiver, | 5 | | executor, trustee, guardian or other representative appointed
| 6 | | by order of any court.
| 7 | | "Retailer" means and includes every person engaged in the | 8 | | business of
making sales at retail as defined in this Section.
| 9 | | A person who holds himself or herself out as being engaged | 10 | | (or who habitually
engages) in selling tangible personal | 11 | | property at retail is a retailer
hereunder with respect to such | 12 | | sales (and not primarily in a service
occupation) | 13 | | notwithstanding the fact that such person designs and produces
| 14 | | such tangible personal property on special order for the | 15 | | purchaser and in
such a way as to render the property of value | 16 | | only to such purchaser, if
such tangible personal property so | 17 | | produced on special order serves
substantially the same | 18 | | function as stock or standard items of tangible
personal | 19 | | property that are sold at retail.
| 20 | | A person whose activities are organized and conducted | 21 | | primarily as a
not-for-profit service enterprise, and who | 22 | | engages in selling tangible
personal property at retail | 23 | | (whether to the public or merely to members and
their guests) | 24 | | is a retailer with respect to such transactions, excepting
only | 25 | | a person organized and operated exclusively for charitable, | 26 | | religious
or educational purposes either (1), to the extent of |
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| 1 | | sales by such person
to its members, students, patients or | 2 | | inmates of tangible personal property
to be used primarily for | 3 | | the purposes of such person, or (2), to the extent
of sales by | 4 | | such person of tangible personal property which is not sold or
| 5 | | offered for sale by persons organized for profit. The selling | 6 | | of school
books and school supplies by schools at retail to | 7 | | students is not
"primarily for the purposes of" the school | 8 | | which does such selling. This
paragraph does not apply to nor | 9 | | subject to taxation occasional dinners,
social or similar | 10 | | activities of a person organized and operated exclusively
for | 11 | | charitable, religious or educational purposes, whether or not | 12 | | such
activities are open to the public.
| 13 | | A person who is the recipient of a grant or contract under | 14 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | 15 | | serves meals to
participants in the federal Nutrition Program | 16 | | for the Elderly in return for
contributions established in | 17 | | amount by the individual participant pursuant
to a schedule of | 18 | | suggested fees as provided for in the federal Act is not a
| 19 | | retailer under this Act with respect to such transactions.
| 20 | | Persons who engage in the business of transferring tangible | 21 | | personal
property upon the redemption of trading stamps are | 22 | | retailers hereunder when
engaged in such business.
| 23 | | The isolated or occasional sale of tangible personal | 24 | | property at retail
by a person who does not hold himself out as | 25 | | being engaged (or who does not
habitually engage) in selling | 26 | | such tangible personal property at retail or
a sale through a |
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| 1 | | bulk vending machine does not make such person a retailer
| 2 | | hereunder. However, any person who is engaged in a business | 3 | | which is not
subject to the tax imposed by the "Retailers' | 4 | | Occupation Tax Act" because
of involving the sale of or a | 5 | | contract to sell real estate or a
construction contract to | 6 | | improve real estate, but who, in the course of
conducting such | 7 | | business, transfers tangible personal property to users or
| 8 | | consumers in the finished form in which it was purchased, and | 9 | | which does
not become real estate, under any provision of a | 10 | | construction contract or
real estate sale or real estate sales | 11 | | agreement entered into with some
other person arising out of or | 12 | | because of such nontaxable business, is a
retailer to the | 13 | | extent of the value of the tangible personal property so
| 14 | | transferred. If, in such transaction, a separate charge is made | 15 | | for the
tangible personal property so transferred, the value of | 16 | | such property, for
the purposes of this Act, is the amount so | 17 | | separately charged, but not less
than the cost of such property | 18 | | to the transferor; if no separate charge is
made, the value of | 19 | | such property, for the purposes of this Act, is the cost
to the | 20 | | transferor of such tangible personal property.
| 21 | | Notwithstanding any other provision of law, a | 22 | | not-for-profit organization that (i) has received an exemption | 23 | | under Section 501(c)(3) of the Internal Revenue Code, (ii) has | 24 | | gross receipts of no more than $10,000 per year, and (iii) is | 25 | | organized and operated exclusively for charitable, religious, | 26 | | or educational purposes is not considered a retailer for the |
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| 1 | | purposes of this Act. | 2 | | "Retailer maintaining a place of business in this State", | 3 | | or any like
term, means and includes any of the following | 4 | | retailers:
| 5 | | 1. A retailer having or maintaining within this State, | 6 | | directly or by
a subsidiary, an office, distribution house, | 7 | | sales house, warehouse or other
place of business, or any | 8 | | agent or other representative operating within this
State | 9 | | under the authority of the retailer or its subsidiary, | 10 | | irrespective of
whether such place of business or agent or | 11 | | other representative is located here
permanently or | 12 | | temporarily, or whether such retailer or subsidiary is | 13 | | licensed
to do business in this State. However, the | 14 | | ownership of property that is
located at the premises of a | 15 | | printer with which the retailer has contracted for
printing | 16 | | and that consists of the final printed product, property | 17 | | that becomes
a part of the final printed product, or copy | 18 | | from which the printed product is
produced shall not result | 19 | | in the retailer being deemed to have or maintain an
office, | 20 | | distribution house, sales house, warehouse, or other place | 21 | | of business
within this State. | 22 | | 1.1. A retailer having a contract with a person located | 23 | | in this State under which the person, for a commission or | 24 | | other consideration based upon the sale of tangible | 25 | | personal property by the retailer, directly or indirectly | 26 | | refers potential customers to the retailer by providing to |
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| 1 | | the potential customers a promotional code or other | 2 | | mechanism that allows the retailer to track purchases | 3 | | referred by such persons. Examples of mechanisms that allow | 4 | | the retailer to track purchases referred by such persons | 5 | | include but are not limited to the use of a link on the | 6 | | person's Internet website, promotional codes distributed | 7 | | through the person's hand-delivered or mailed material, | 8 | | and promotional codes distributed by the person through | 9 | | radio or other broadcast media. The provisions of this | 10 | | paragraph 1.1 shall apply only if the cumulative gross | 11 | | receipts from sales of tangible personal property by the | 12 | | retailer to customers who are referred to the retailer by | 13 | | all persons in this State under such contracts exceed | 14 | | $10,000 during the preceding 4 quarterly periods ending on | 15 | | the last day of March, June, September, and December. A | 16 | | retailer meeting the requirements of this paragraph 1.1 | 17 | | shall be presumed to be maintaining a place of business in | 18 | | this State but may rebut this presumption by submitting | 19 | | proof that the referrals or other activities pursued within | 20 | | this State by such persons were not sufficient to meet the | 21 | | nexus standards of the United States Constitution during | 22 | | the preceding 4 quarterly periods. | 23 | | 1.2. Beginning July 1, 2011, a retailer having a | 24 | | contract with a person located in this State under which: | 25 | | A. the retailer sells the same or substantially | 26 | | similar line of products as the person located in this |
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| 1 | | State and does so using an identical or substantially | 2 | | similar name, trade name, or trademark as the person | 3 | | located in this State; and | 4 | | B. the retailer provides a commission or other | 5 | | consideration to the person located in this State based | 6 | | upon the sale of tangible personal property by the | 7 | | retailer. | 8 | | The provisions of this paragraph 1.2 shall apply only if | 9 | | the cumulative gross receipts from sales of tangible | 10 | | personal property by the retailer to customers in this | 11 | | State under all such contracts exceed $10,000 during the | 12 | | preceding 4 quarterly periods ending on the last day of | 13 | | March, June, September, and December.
| 14 | | 2. A retailer soliciting orders for tangible personal | 15 | | property by
means of a telecommunication or television | 16 | | shopping system (which utilizes toll
free numbers) which is | 17 | | intended by the retailer to be broadcast by cable
| 18 | | television or other means of broadcasting, to consumers | 19 | | located in this State.
| 20 | | 3. A retailer, pursuant to a contract with a | 21 | | broadcaster or publisher
located in this State, soliciting | 22 | | orders for tangible personal property by
means of | 23 | | advertising which is disseminated primarily to consumers | 24 | | located in
this State and only secondarily to bordering | 25 | | jurisdictions.
| 26 | | 4. A retailer soliciting orders for tangible personal |
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| 1 | | property by mail
if the solicitations are substantial and | 2 | | recurring and if the retailer benefits
from any banking, | 3 | | financing, debt collection, telecommunication, or | 4 | | marketing
activities occurring in this State or benefits | 5 | | from the location in this State
of authorized installation, | 6 | | servicing, or repair facilities.
| 7 | | 5. A retailer that is owned or controlled by the same | 8 | | interests that own
or control any retailer engaging in | 9 | | business in the same or similar line of
business in this | 10 | | State.
| 11 | | 6. A retailer having a franchisee or licensee operating | 12 | | under its trade
name if the franchisee or licensee is | 13 | | required to collect the tax under this
Section.
| 14 | | 7. A retailer, pursuant to a contract with a cable | 15 | | television operator
located in this State, soliciting | 16 | | orders for tangible personal property by
means of | 17 | | advertising which is transmitted or distributed over a | 18 | | cable
television system in this State.
| 19 | | 8. A retailer engaging in activities in Illinois, which | 20 | | activities in
the state in which the retail business | 21 | | engaging in such activities is located
would constitute | 22 | | maintaining a place of business in that state.
| 23 | | "Bulk vending machine" means a vending machine,
containing | 24 | | unsorted confections, nuts, toys, or other items designed
| 25 | | primarily to be used or played with by children
which, when a | 26 | | coin or coins of a denomination not larger than $0.50 are |
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| 1 | | inserted, are dispensed in equal portions, at random and
| 2 | | without selection by the customer.
| 3 | | (Source: P.A. 98-628, eff. 1-1-15; 98-1080, eff. 8-26-14; | 4 | | 98-1089, eff. 1-1-15; revised 10-1-14.)
| 5 | | Section 10. The Service Use Tax Act is amended by changing | 6 | | Section 2 as follows:
| 7 | | (35 ILCS 110/2) (from Ch. 120, par. 439.32)
| 8 | | Sec. 2. Definitions. | 9 | | "Use" means the exercise by any person of any right or | 10 | | power
over tangible personal property incident to the ownership | 11 | | of that
property, but does not include the sale or use for | 12 | | demonstration by him
of that property in any form as tangible | 13 | | personal property in the
regular course of business.
"Use" does | 14 | | not mean the interim
use of
tangible personal property nor the | 15 | | physical incorporation of tangible
personal property, as an | 16 | | ingredient or constituent, into other tangible
personal | 17 | | property, (a) which is sold in the regular course of business
| 18 | | or (b) which the person incorporating such ingredient or | 19 | | constituent
therein has undertaken at the time of such purchase | 20 | | to cause to be
transported in interstate commerce to | 21 | | destinations outside the State of
Illinois.
| 22 | | "Purchased from a serviceman" means the acquisition of the | 23 | | ownership
of, or title to, tangible personal property through a | 24 | | sale of service.
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| 1 | | "Purchaser" means any person who, through a sale of | 2 | | service, acquires
the ownership of, or title to, any tangible | 3 | | personal property.
| 4 | | "Cost price" means the consideration paid by the serviceman | 5 | | for a
purchase valued in money, whether paid in money or | 6 | | otherwise, including
cash, credits and services, and shall be | 7 | | determined without any
deduction on account of the supplier's | 8 | | cost of the property sold or on
account of any other expense | 9 | | incurred by the supplier. When a serviceman
contracts out part | 10 | | or all of the services required in his sale of service,
it | 11 | | shall be presumed that the cost price to the serviceman of the | 12 | | property
transferred to him or her by his or her subcontractor | 13 | | is equal to 50% of
the subcontractor's charges to the | 14 | | serviceman in the absence of proof of
the consideration paid by | 15 | | the subcontractor for the purchase of such property.
| 16 | | "Selling price" means the consideration for a sale valued | 17 | | in money
whether received in money or otherwise, including | 18 | | cash, credits and
service, and shall be determined without any | 19 | | deduction on account of the
serviceman's cost of the property | 20 | | sold, the cost of materials used,
labor or service cost or any | 21 | | other expense whatsoever, but does not
include interest or | 22 | | finance charges which appear as separate items on
the bill of | 23 | | sale or sales contract nor charges that are added to prices
by | 24 | | sellers on account of the seller's duty to collect, from the
| 25 | | purchaser, the tax that is imposed by this Act.
| 26 | | "Department" means the Department of Revenue.
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| 1 | | "Person" means any natural individual, firm, partnership,
| 2 | | association, joint stock company, joint venture, public or | 3 | | private
corporation, limited liability company, and any | 4 | | receiver, executor, trustee,
guardian or other representative | 5 | | appointed by order of any court.
| 6 | | "Sale of service" means any transaction except:
| 7 | | (1) a retail sale of tangible personal property taxable | 8 | | under the
Retailers' Occupation Tax Act or under the Use | 9 | | Tax Act.
| 10 | | (2) a sale of tangible personal property for the | 11 | | purpose of resale
made in compliance with Section 2c of the | 12 | | Retailers' Occupation Tax Act.
| 13 | | (3) except as hereinafter provided, a sale or transfer | 14 | | of tangible
personal property as an incident to the | 15 | | rendering of service for or by
any governmental body, or | 16 | | for or by any corporation, society,
association, | 17 | | foundation or institution organized and operated
| 18 | | exclusively for charitable, religious or educational | 19 | | purposes or any
not-for-profit corporation, society, | 20 | | association, foundation,
institution or organization which | 21 | | has no compensated officers or
employees and which is | 22 | | organized and operated primarily for the
recreation of | 23 | | persons 55 years of age or older. A limited liability | 24 | | company
may qualify for the exemption under this paragraph | 25 | | only if the limited
liability company is organized and | 26 | | operated exclusively for educational
purposes.
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| 1 | | (4) a sale or transfer of tangible personal
property as | 2 | | an incident to the
rendering of service for interstate | 3 | | carriers for hire for use as rolling stock
moving in | 4 | | interstate commerce or by lessors under a lease of one year | 5 | | or
longer, executed or in effect at the time of purchase of | 6 | | personal property, to
interstate carriers for hire for use | 7 | | as rolling stock moving in interstate
commerce so long as | 8 | | so used by such interstate carriers for hire, and equipment
| 9 | | operated by a telecommunications provider, licensed as a | 10 | | common carrier by the
Federal Communications Commission, | 11 | | which is permanently installed in or affixed
to aircraft | 12 | | moving in interstate commerce.
| 13 | | (4a) a sale or transfer of tangible personal
property | 14 | | as an incident
to the rendering of service for owners, | 15 | | lessors, or shippers of tangible
personal property which is | 16 | | utilized by interstate carriers for hire for
use as rolling | 17 | | stock moving in interstate commerce so long as so used by
| 18 | | interstate carriers for hire, and equipment operated by a
| 19 | | telecommunications provider, licensed as a common carrier | 20 | | by the Federal
Communications Commission, which is | 21 | | permanently installed in or affixed to
aircraft moving in | 22 | | interstate commerce.
| 23 | | (4a-5) on and after July 1, 2003 and through June 30, | 24 | | 2004, a sale or transfer of a motor vehicle
of
the
second | 25 | | division with a gross vehicle weight in excess of 8,000 | 26 | | pounds as an
incident to the rendering of service if that |
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| 1 | | motor
vehicle is subject
to the commercial distribution fee | 2 | | imposed under Section 3-815.1 of the
Illinois Vehicle
Code. | 3 | | Beginning on July 1, 2004 and through June 30, 2005, the | 4 | | use in this State of motor vehicles of the second division: | 5 | | (i) with a gross vehicle weight rating in excess of 8,000 | 6 | | pounds; (ii) that are subject to the commercial | 7 | | distribution fee imposed under Section 3-815.1 of the | 8 | | Illinois Vehicle Code; and (iii) that are primarily used | 9 | | for commercial purposes. Through June 30, 2005, this
| 10 | | exemption applies to repair and replacement parts added | 11 | | after the
initial
purchase of such a motor vehicle if that | 12 | | motor vehicle is used in a manner that
would
qualify for | 13 | | the rolling stock exemption otherwise provided for in this | 14 | | Act. For purposes of this paragraph, "used for commercial | 15 | | purposes" means the transportation of persons or property | 16 | | in furtherance of any commercial or industrial enterprise | 17 | | whether for-hire or not.
| 18 | | (5) a sale or transfer of machinery and equipment used | 19 | | primarily in the
process of the manufacturing or | 20 | | assembling, either in an existing, an expanded
or a new | 21 | | manufacturing facility, of tangible personal property for | 22 | | wholesale or
retail sale or lease, whether such sale or | 23 | | lease is made directly by the
manufacturer or by some other | 24 | | person, whether the materials used in the process
are owned | 25 | | by the manufacturer or some other person, or whether such | 26 | | sale or
lease is made apart from or as an incident to the |
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| 1 | | seller's engaging in a
service occupation and the | 2 | | applicable tax is a Service Use Tax or Service
Occupation | 3 | | Tax, rather than Use Tax or Retailers' Occupation Tax. The | 4 | | exemption provided by this paragraph (5) does not include | 5 | | machinery and equipment used in (i) the generation of | 6 | | electricity for wholesale or retail sale; (ii) the | 7 | | generation or treatment of natural or artificial gas for | 8 | | wholesale or retail sale that is delivered to customers | 9 | | through pipes, pipelines, or mains; or (iii) the treatment | 10 | | of water for wholesale or retail sale that is delivered to | 11 | | customers through pipes, pipelines, or mains. The | 12 | | provisions of this amendatory Act of the 98th General | 13 | | Assembly are declaratory of existing law as to the meaning | 14 | | and scope of this exemption.
| 15 | | (5a) the repairing, reconditioning or remodeling, for | 16 | | a
common carrier by rail, of tangible personal property | 17 | | which belongs to such
carrier for hire, and as to which | 18 | | such carrier receives the physical possession
of the | 19 | | repaired, reconditioned or remodeled item of tangible | 20 | | personal property
in Illinois, and which such carrier | 21 | | transports, or shares with another common
carrier in the | 22 | | transportation of such property, out of Illinois on a | 23 | | standard
uniform bill of lading showing the person who | 24 | | repaired, reconditioned or
remodeled the property to a | 25 | | destination outside Illinois, for use outside
Illinois.
| 26 | | (5b) a sale or transfer of tangible personal property |
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| 1 | | which is produced by
the seller thereof on special order in | 2 | | such a way as to have made the
applicable tax the Service | 3 | | Occupation Tax or the Service Use Tax, rather than
the | 4 | | Retailers' Occupation Tax or the Use Tax, for an interstate | 5 | | carrier by rail
which receives the physical possession of | 6 | | such property in Illinois, and which
transports such | 7 | | property, or shares with another common carrier in the
| 8 | | transportation of such property, out of Illinois on a | 9 | | standard uniform bill of
lading showing the seller of the | 10 | | property as the shipper or consignor of such
property to a | 11 | | destination outside Illinois, for use outside Illinois.
| 12 | | (6) until July 1, 2003, a sale or transfer of | 13 | | distillation machinery
and equipment, sold
as a unit or kit | 14 | | and assembled or installed by the retailer, which
machinery | 15 | | and equipment is certified by the user to be used only for | 16 | | the
production of ethyl alcohol that will be used for | 17 | | consumption as motor fuel
or as a component of motor fuel | 18 | | for the personal use of such user and not
subject to sale | 19 | | or resale.
| 20 | | (7) at the election of any serviceman not required to | 21 | | be
otherwise registered as a retailer under Section 2a of | 22 | | the Retailers'
Occupation Tax Act, made for each fiscal | 23 | | year sales
of service in which the aggregate annual cost | 24 | | price of tangible
personal property transferred as an | 25 | | incident to the sales of service is
less than 35%, or 75% | 26 | | in the case of servicemen transferring prescription
drugs |
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| 1 | | or servicemen engaged in graphic arts production, of the | 2 | | aggregate
annual total gross receipts from all sales of | 3 | | service. The purchase of
such tangible personal property by | 4 | | the serviceman shall be subject to tax
under the Retailers' | 5 | | Occupation Tax Act and the Use Tax Act.
However, if a
| 6 | | primary serviceman who has made the election described in | 7 | | this paragraph
subcontracts service work to a secondary | 8 | | serviceman who has also made the
election described in this | 9 | | paragraph, the primary serviceman does not
incur a Use Tax | 10 | | liability if the secondary serviceman (i) has paid or will | 11 | | pay
Use
Tax on his or her cost price of any tangible | 12 | | personal property transferred
to the primary serviceman | 13 | | and (ii) certifies that fact in writing to the
primary
| 14 | | serviceman.
| 15 | | Tangible personal property transferred incident to the | 16 | | completion of a
maintenance agreement is exempt from the tax | 17 | | imposed pursuant to this Act.
| 18 | | Exemption (5) also includes machinery and equipment used in | 19 | | the general
maintenance or repair of such exempt machinery and | 20 | | equipment or for in-house
manufacture of exempt machinery and | 21 | | equipment. The machinery and equipment exemption does not | 22 | | include machinery and equipment used in (i) the generation of | 23 | | electricity for wholesale or retail sale; (ii) the generation | 24 | | or treatment of natural or artificial gas for wholesale or | 25 | | retail sale that is delivered to customers through pipes, | 26 | | pipelines, or mains; or (iii) the treatment of water for |
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| 1 | | wholesale or retail sale that is delivered to customers through | 2 | | pipes, pipelines, or mains. The provisions of this amendatory | 3 | | Act of the 98th General Assembly are declaratory of existing | 4 | | law as to the meaning and scope of this exemption. For the | 5 | | purposes of exemption
(5), each of these terms shall have the | 6 | | following meanings: (1) "manufacturing
process" shall mean the | 7 | | production of any article of tangible personal
property, | 8 | | whether such article is a finished product or an article for | 9 | | use in
the process of manufacturing or assembling a different | 10 | | article of tangible
personal property, by procedures commonly | 11 | | regarded as manufacturing,
processing, fabricating, or | 12 | | refining which changes some existing
material or materials into | 13 | | a material with a different form, use or
name. In relation to a | 14 | | recognized integrated business composed of a
series of | 15 | | operations which collectively constitute manufacturing, or
| 16 | | individually constitute manufacturing operations, the | 17 | | manufacturing
process shall be deemed to commence with the | 18 | | first operation or stage of
production in the series, and shall | 19 | | not be deemed to end until the
completion of the final product | 20 | | in the last operation or stage of
production in the series; and | 21 | | further, for purposes of exemption (5),
photoprocessing is | 22 | | deemed to be a manufacturing process of tangible
personal | 23 | | property for wholesale or retail sale; (2) "assembling process" | 24 | | shall
mean the production of any article of tangible personal | 25 | | property, whether such
article is a finished product or an | 26 | | article for use in the process of
manufacturing or assembling a |
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| 1 | | different article of tangible personal
property, by the | 2 | | combination of existing materials in a manner commonly
regarded | 3 | | as assembling which results in a material of a different form,
| 4 | | use or name; (3) "machinery" shall mean major mechanical | 5 | | machines or
major components of such machines contributing to a | 6 | | manufacturing or
assembling process; and (4) "equipment" shall | 7 | | include any independent
device or tool separate from any | 8 | | machinery but essential to an
integrated manufacturing or | 9 | | assembly process; including computers
used primarily in a | 10 | | manufacturer's computer
assisted design, computer assisted | 11 | | manufacturing (CAD/CAM) system;
or any subunit or assembly | 12 | | comprising a component of any machinery or
auxiliary, adjunct | 13 | | or attachment parts of machinery, such as tools, dies,
jigs, | 14 | | fixtures, patterns and molds; or any parts which require | 15 | | periodic
replacement in the course of normal operation; but | 16 | | shall not include hand
tools.
Equipment includes chemicals or | 17 | | chemicals acting as catalysts but only if the
chemicals or | 18 | | chemicals acting as catalysts effect a direct and immediate | 19 | | change
upon a
product being manufactured or assembled for | 20 | | wholesale or retail sale or
lease.
The purchaser of such | 21 | | machinery and equipment who has an active
resale registration | 22 | | number shall furnish such number to the seller at the
time of | 23 | | purchase. The user of such machinery and equipment and tools
| 24 | | without an active resale registration number shall prepare a | 25 | | certificate of
exemption for each transaction stating facts | 26 | | establishing the exemption for
that transaction, which |
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| 1 | | certificate shall be available to the Department
for inspection | 2 | | or audit. The Department shall prescribe the form of the
| 3 | | certificate.
| 4 | | Any informal rulings, opinions or letters issued by the | 5 | | Department in
response to an inquiry or request for any opinion | 6 | | from any person
regarding the coverage and applicability of | 7 | | exemption (5) to specific
devices shall be published, | 8 | | maintained as a public record, and made
available for public | 9 | | inspection and copying. If the informal ruling,
opinion or | 10 | | letter contains trade secrets or other confidential
| 11 | | information, where possible the Department shall delete such | 12 | | information
prior to publication. Whenever such informal | 13 | | rulings, opinions, or
letters contain any policy of general | 14 | | applicability, the Department
shall formulate and adopt such | 15 | | policy as a rule in accordance with the
provisions of the | 16 | | Illinois Administrative Procedure Act.
| 17 | | On and after July 1, 1987, no entity otherwise eligible | 18 | | under exemption
(3) of this Section shall make tax free | 19 | | purchases unless it has an active
exemption identification | 20 | | number issued by the Department.
| 21 | | The purchase, employment and transfer of such tangible | 22 | | personal
property as newsprint and ink for the primary purpose | 23 | | of conveying news
(with or without other information) is not a | 24 | | purchase, use or sale of
service or of tangible personal | 25 | | property within the meaning of this Act.
| 26 | | "Serviceman" means any person who is engaged in the |
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| 1 | | occupation of
making sales of service.
| 2 | | Notwithstanding any other provision of law, a | 3 | | not-for-profit organization that (i) has received an exemption | 4 | | under Section 501(c)(3) of the Internal Revenue Code, (ii) has | 5 | | gross receipts of no more than $10,000 per year, and (iii) is | 6 | | organized and operated exclusively for charitable, religious, | 7 | | or educational purposes is not considered a serviceman for the | 8 | | purposes of this Act. | 9 | | "Sale at retail" means "sale at retail" as defined in the | 10 | | Retailers'
Occupation Tax Act.
| 11 | | "Supplier" means any person who makes sales of tangible | 12 | | personal
property to servicemen for the purpose of resale as an | 13 | | incident to a
sale of service.
| 14 | | "Serviceman maintaining a place of business in this State", | 15 | | or any
like term, means and includes any serviceman:
| 16 | | 1. having or maintaining within this State, directly or | 17 | | by a
subsidiary, an office, distribution house, sales | 18 | | house, warehouse or
other place of business, or any agent | 19 | | or other representative operating
within this State under | 20 | | the authority of the serviceman or its
subsidiary, | 21 | | irrespective of whether such place of business or agent or
| 22 | | other representative is located here permanently or | 23 | | temporarily, or
whether such serviceman or subsidiary is | 24 | | licensed to do business in this
State; | 25 | | 1.1. having a contract with a person located in this | 26 | | State under which the person, for a commission or other |
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| 1 | | consideration based on the sale of service by the | 2 | | serviceman, directly or indirectly refers potential | 3 | | customers to the serviceman by providing to the potential | 4 | | customers a promotional code or other mechanism that allows | 5 | | the serviceman to track purchases referred by such persons. | 6 | | Examples of mechanisms that allow the serviceman to track | 7 | | purchases referred by such persons include but are not | 8 | | limited to the use of a link on the person's Internet | 9 | | website, promotional codes distributed through the | 10 | | person's hand-delivered or mailed material, and | 11 | | promotional codes distributed by the person through radio | 12 | | or other broadcast media. The provisions of this paragraph | 13 | | 1.1 shall apply only if the cumulative gross receipts from | 14 | | sales of service by the serviceman to customers who are | 15 | | referred to the serviceman by all persons in this State | 16 | | under such contracts exceed $10,000 during the preceding 4 | 17 | | quarterly periods ending on the last day of March, June, | 18 | | September, and December; a serviceman meeting the | 19 | | requirements of this paragraph 1.1 shall be presumed to be | 20 | | maintaining a place of business in this State but may rebut | 21 | | this presumption by submitting proof that the referrals or | 22 | | other activities pursued within this State by such persons | 23 | | were not sufficient to meet the nexus standards of the | 24 | | United States Constitution during the preceding 4 | 25 | | quarterly periods; | 26 | | 1.2. beginning July 1, 2011, having a contract with a |
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| 1 | | person located in this State under which: | 2 | | A. the serviceman sells the same or substantially | 3 | | similar line of services as the person located in this | 4 | | State and does so using an identical or substantially | 5 | | similar name, trade name, or trademark as the person | 6 | | located in this State; and | 7 | | B. the serviceman provides a commission or other | 8 | | consideration to the person located in this State based | 9 | | upon the sale of services by the serviceman. | 10 | | The provisions of this paragraph 1.2 shall apply only if | 11 | | the cumulative gross receipts from sales of service by the | 12 | | serviceman to customers in this State under all such | 13 | | contracts exceed $10,000 during the preceding 4 quarterly | 14 | | periods ending on the last day of March, June, September, | 15 | | and December;
| 16 | | 2. soliciting orders for tangible personal property by | 17 | | means of a
telecommunication or television shopping system | 18 | | (which utilizes toll free
numbers) which is intended by the | 19 | | retailer to be broadcast by cable
television or other means | 20 | | of broadcasting, to consumers located in this State;
| 21 | | 3. pursuant to a contract with a broadcaster or | 22 | | publisher located in this
State, soliciting orders for | 23 | | tangible personal property by means of advertising
which is | 24 | | disseminated primarily to consumers located in this State | 25 | | and only
secondarily to bordering jurisdictions;
| 26 | | 4. soliciting orders for tangible personal property by |
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| 1 | | mail if the
solicitations are substantial and recurring and | 2 | | if the retailer benefits
from any banking, financing, debt | 3 | | collection, telecommunication, or
marketing activities | 4 | | occurring in this State or benefits from the location
in | 5 | | this State of authorized installation, servicing, or | 6 | | repair facilities;
| 7 | | 5. being owned or controlled by the same interests | 8 | | which own or
control any retailer engaging in business in | 9 | | the same or similar line of
business in this State;
| 10 | | 6. having a franchisee or licensee operating under its | 11 | | trade name if
the franchisee or licensee is required to | 12 | | collect the tax under this Section;
| 13 | | 7. pursuant to a contract with a cable television | 14 | | operator located in
this State, soliciting orders for | 15 | | tangible personal property by means of
advertising which is | 16 | | transmitted or distributed over a cable television
system | 17 | | in this State; or
| 18 | | 8. engaging in activities in Illinois, which | 19 | | activities in the
state in which the supply business | 20 | | engaging in such activities is located
would constitute | 21 | | maintaining a place of business in that state.
| 22 | | (Source: P.A. 98-583, eff. 1-1-14; 98-1089, eff. 1-1-15.)
| 23 | | Section 15. The Service Occupation Tax Act is amended by | 24 | | changing Section 2 as follows:
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| 1 | | (35 ILCS 115/2) (from Ch. 120, par. 439.102)
| 2 | | Sec. 2. "Transfer" means any transfer of the title to | 3 | | property or of
the ownership of property whether or not the | 4 | | transferor retains title as
security for the payment of amounts | 5 | | due him from the transferee.
| 6 | | "Cost Price" means the consideration paid by the serviceman | 7 | | for a
purchase valued in money, whether paid in money or | 8 | | otherwise, including
cash, credits and services, and shall be | 9 | | determined without any deduction
on account of the supplier's | 10 | | cost of the property sold or on account of any
other expense | 11 | | incurred by the supplier. When a serviceman contracts out
part | 12 | | or all of the services required in his sale of service, it | 13 | | shall be
presumed that the cost price to the serviceman of the | 14 | | property
transferred to him by his or her subcontractor is | 15 | | equal to 50% of the
subcontractor's charges to the serviceman | 16 | | in the absence of proof of the
consideration paid by the | 17 | | subcontractor for the purchase of such
property.
| 18 | | "Department" means the Department of Revenue.
| 19 | | "Person" means any natural individual, firm, partnership, | 20 | | association, joint
stock company, joint venture, public or | 21 | | private corporation, limited liability
company, and any | 22 | | receiver, executor, trustee, guardian or other representative
| 23 | | appointed by order of any court.
| 24 | | "Sale of Service" means any transaction except:
| 25 | | (a) A retail sale of tangible personal property taxable | 26 | | under the Retailers'
Occupation Tax Act or under the Use Tax |
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| 1 | | Act.
| 2 | | (b) A sale of tangible personal property for the purpose of | 3 | | resale made in
compliance with Section 2c of the Retailers' | 4 | | Occupation Tax Act.
| 5 | | (c) Except as hereinafter provided, a sale or transfer of | 6 | | tangible personal
property as an incident to the rendering of | 7 | | service for or by any governmental
body or for or by any | 8 | | corporation, society, association, foundation or
institution | 9 | | organized and operated exclusively for charitable, religious | 10 | | or
educational purposes or any not-for-profit corporation, | 11 | | society, association,
foundation, institution or organization | 12 | | which has no compensated officers or
employees and which is | 13 | | organized and operated primarily for the recreation of
persons | 14 | | 55 years of age or older. A limited liability company may | 15 | | qualify for
the exemption under this paragraph only if the | 16 | | limited liability company is
organized and operated | 17 | | exclusively for educational purposes.
| 18 | | (d) A sale or transfer of tangible personal
property
as an | 19 | | incident to the
rendering of service for interstate carriers | 20 | | for hire for use as rolling stock
moving in interstate commerce | 21 | | or lessors under leases of one year or longer,
executed or in | 22 | | effect at the time of purchase, to interstate carriers for hire
| 23 | | for use as rolling stock moving in interstate commerce, and | 24 | | equipment operated
by a telecommunications provider, licensed | 25 | | as a common
carrier by the Federal Communications Commission, | 26 | | which is permanently
installed in or affixed to aircraft moving |
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| 1 | | in interstate commerce.
| 2 | | (d-1) A sale or transfer of tangible personal
property as | 3 | | an incident to
the rendering of service for owners, lessors or | 4 | | shippers of tangible personal
property which is utilized by | 5 | | interstate carriers for hire for use as rolling
stock moving in | 6 | | interstate commerce, and equipment operated
by a | 7 | | telecommunications provider, licensed as a common carrier by | 8 | | the
Federal Communications Commission, which is permanently | 9 | | installed in or
affixed to aircraft moving in interstate | 10 | | commerce.
| 11 | | (d-1.1) On and after July 1, 2003 and through June 30, | 12 | | 2004, a sale or transfer of a motor vehicle
of the
second | 13 | | division with a gross vehicle weight in excess of 8,000 pounds | 14 | | as an
incident to the rendering of service if that motor
| 15 | | vehicle is subject
to the commercial distribution fee imposed | 16 | | under Section 3-815.1 of the
Illinois Vehicle
Code. Beginning | 17 | | on July 1, 2004 and through June 30, 2005, the use in this | 18 | | State of motor vehicles of the second division: (i) with a | 19 | | gross vehicle weight rating in excess of 8,000 pounds; (ii) | 20 | | that are subject to the commercial distribution fee imposed | 21 | | under Section 3-815.1 of the Illinois Vehicle Code; and (iii) | 22 | | that are primarily used for commercial purposes. Through June | 23 | | 30, 2005, this exemption applies to repair and replacement | 24 | | parts added after the
initial
purchase of such a motor vehicle | 25 | | if that motor vehicle is used in a manner that
would
qualify | 26 | | for the rolling stock exemption otherwise provided for in this |
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| 1 | | Act. For purposes of this paragraph, "used for commercial | 2 | | purposes" means the transportation of persons or property in | 3 | | furtherance of any commercial or industrial enterprise whether | 4 | | for-hire or not.
| 5 | | (d-2) The repairing, reconditioning or remodeling, for a | 6 | | common carrier by
rail, of tangible personal property which | 7 | | belongs to such carrier for hire, and
as to which such carrier | 8 | | receives the physical possession of the repaired,
| 9 | | reconditioned or remodeled item of tangible personal property | 10 | | in Illinois, and
which such carrier transports, or shares with | 11 | | another common carrier in the
transportation of such property, | 12 | | out of Illinois on a standard uniform bill of
lading showing | 13 | | the person who repaired, reconditioned or remodeled the | 14 | | property
as the shipper or consignor of such property to a | 15 | | destination outside Illinois,
for use outside Illinois.
| 16 | | (d-3) A sale or transfer of tangible personal property | 17 | | which
is produced by the seller thereof on special order in | 18 | | such a way as to have
made the applicable tax the Service | 19 | | Occupation Tax or the Service Use Tax,
rather than the | 20 | | Retailers' Occupation Tax or the Use Tax, for an interstate
| 21 | | carrier by rail which receives the physical possession of such | 22 | | property in
Illinois, and which transports such property, or | 23 | | shares with another common
carrier in the transportation of | 24 | | such property, out of Illinois on a standard
uniform bill of | 25 | | lading showing the seller of the property as the shipper or
| 26 | | consignor of such property to a destination outside Illinois, |
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| 1 | | for use outside
Illinois.
| 2 | | (d-4) Until January 1, 1997, a sale, by a registered | 3 | | serviceman paying tax
under this Act to the Department, of | 4 | | special order printed materials delivered
outside Illinois and | 5 | | which are not returned to this State, if delivery is made
by | 6 | | the seller or agent of the seller, including an agent who | 7 | | causes the product
to be delivered outside Illinois by a common | 8 | | carrier or the U.S.
postal service.
| 9 | | (e) A sale or transfer of machinery and equipment used | 10 | | primarily in
the process of the manufacturing or assembling, | 11 | | either in an existing, an
expanded or a new manufacturing | 12 | | facility, of tangible personal property for
wholesale or retail | 13 | | sale or lease, whether such sale or lease is made directly
by | 14 | | the manufacturer or by some other person, whether the materials | 15 | | used in the
process are owned by the manufacturer or some other | 16 | | person, or whether such
sale or lease is made apart from or as | 17 | | an incident to the seller's engaging in
a service occupation | 18 | | and the applicable tax is a Service Occupation Tax or
Service | 19 | | Use Tax, rather than Retailers' Occupation Tax or Use Tax. The | 20 | | exemption provided by this paragraph (e) does not include | 21 | | machinery and equipment used in (i) the generation of | 22 | | electricity for wholesale or retail sale; (ii) the generation | 23 | | or treatment of natural or artificial gas for wholesale or | 24 | | retail sale that is delivered to customers through pipes, | 25 | | pipelines, or mains; or (iii) the treatment of water for | 26 | | wholesale or retail sale that is delivered to customers through |
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| 1 | | pipes, pipelines, or mains. The provisions of this amendatory | 2 | | Act of the 98th General Assembly are declaratory of existing | 3 | | law as to the meaning and scope of this exemption.
| 4 | | (f) Until July 1, 2003, the sale or transfer of | 5 | | distillation
machinery
and equipment, sold as a
unit or kit and | 6 | | assembled or installed by the retailer, which machinery
and | 7 | | equipment is certified by the user to be used only for the | 8 | | production
of ethyl alcohol that will be used for consumption | 9 | | as motor fuel or as a
component of motor fuel for the personal | 10 | | use of such user and not subject
to sale or resale.
| 11 | | (g) At the election of any serviceman not required to be | 12 | | otherwise
registered as a retailer under Section 2a of the | 13 | | Retailers' Occupation Tax Act,
made for each fiscal year sales | 14 | | of service in which the aggregate annual cost
price of tangible | 15 | | personal property transferred as an incident to the sales of
| 16 | | service is less than 35% (75% in the case of servicemen | 17 | | transferring
prescription drugs or servicemen engaged in | 18 | | graphic arts production) of the
aggregate annual total gross | 19 | | receipts from all sales of service. The purchase
of such | 20 | | tangible personal property by the serviceman shall be subject | 21 | | to tax
under the Retailers' Occupation Tax Act and the Use Tax | 22 | | Act.
However, if a
primary serviceman who has made the election | 23 | | described in this paragraph
subcontracts service work to a | 24 | | secondary serviceman who has also made the
election described | 25 | | in this paragraph, the primary serviceman does not
incur a Use | 26 | | Tax liability if the secondary serviceman (i) has paid or will |
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| 1 | | pay
Use
Tax on his or her cost price of any tangible personal | 2 | | property transferred
to the primary serviceman and (ii) | 3 | | certifies that fact in writing to the
primary serviceman.
| 4 | | Tangible personal property transferred incident to the | 5 | | completion of a
maintenance agreement is exempt from the tax | 6 | | imposed pursuant to this Act.
| 7 | | Exemption (e) also includes machinery and equipment used in | 8 | | the
general maintenance or repair of such exempt machinery and | 9 | | equipment or for
in-house manufacture of exempt machinery and | 10 | | equipment.
The machinery and equipment exemption does not | 11 | | include machinery and equipment used in (i) the generation of | 12 | | electricity for wholesale or retail sale; (ii) the generation | 13 | | or treatment of natural or artificial gas for wholesale or | 14 | | retail sale that is delivered to customers through pipes, | 15 | | pipelines, or mains; or (iii) the treatment of water for | 16 | | wholesale or retail sale that is delivered to customers through | 17 | | pipes, pipelines, or mains. The provisions of this amendatory | 18 | | Act of the 98th General Assembly are declaratory of existing | 19 | | law as to the meaning and scope of this exemption. For the | 20 | | purposes of exemption (e), each of these terms shall have the | 21 | | following
meanings: (1) "manufacturing process" shall mean the | 22 | | production of any
article of tangible personal property, | 23 | | whether such article is a
finished product or an article for | 24 | | use in the process of manufacturing
or assembling a different | 25 | | article of tangible personal property, by
procedures commonly | 26 | | regarded as manufacturing, processing, fabricating,
or |
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| 1 | | refining which changes some existing material or materials into | 2 | | a
material with a different form, use or name. In relation to a
| 3 | | recognized integrated business composed of a series of | 4 | | operations which
collectively constitute manufacturing, or | 5 | | individually constitute
manufacturing operations, the | 6 | | manufacturing process shall be deemed to
commence with the | 7 | | first operation or stage of production in the series,
and shall | 8 | | not be deemed to end until the completion of the final product
| 9 | | in the last operation or stage of production in the series; and | 10 | | further for
purposes of exemption (e), photoprocessing is | 11 | | deemed to be a manufacturing
process of tangible personal | 12 | | property for wholesale or retail sale;
(2) "assembling process" | 13 | | shall mean the production of any article of
tangible personal | 14 | | property, whether such article is a finished product
or an | 15 | | article for use in the process of manufacturing or assembling a
| 16 | | different article of tangible personal property, by the | 17 | | combination of
existing materials in a manner commonly regarded | 18 | | as assembling which
results in a material of a different form, | 19 | | use or name; (3) "machinery"
shall mean major mechanical | 20 | | machines or major components of such machines
contributing to a | 21 | | manufacturing or assembling process; and (4) "equipment"
shall | 22 | | include any independent device or tool separate from any | 23 | | machinery but
essential to an integrated manufacturing or | 24 | | assembly process; including
computers used primarily in a | 25 | | manufacturer's computer
assisted design, computer assisted | 26 | | manufacturing (CAD/CAM) system; or any
subunit or assembly |
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| 1 | | comprising a component of any machinery or auxiliary,
adjunct | 2 | | or attachment parts of machinery, such as tools, dies, jigs, | 3 | | fixtures,
patterns and molds; or any parts which require | 4 | | periodic replacement in the
course of normal operation; but | 5 | | shall not include hand tools. Equipment
includes chemicals or | 6 | | chemicals acting as catalysts but only if the chemicals
or | 7 | | chemicals acting as catalysts effect a direct and immediate | 8 | | change upon a
product being manufactured or assembled for | 9 | | wholesale or retail sale or lease.
The purchaser of such | 10 | | machinery and equipment
who has an active resale registration | 11 | | number shall furnish such number to
the seller at the time of | 12 | | purchase. The purchaser of such machinery and
equipment and | 13 | | tools without an active resale registration number shall | 14 | | furnish
to the seller a certificate of exemption for each | 15 | | transaction stating facts
establishing the exemption for that | 16 | | transaction, which certificate shall
be available to the | 17 | | Department for inspection or audit.
| 18 | | Except as provided in Section 2d of this Act, the rolling | 19 | | stock exemption
applies to rolling
stock
used by an interstate
| 20 | | carrier for hire, even just between points in Illinois, if such | 21 | | rolling
stock transports, for hire, persons whose journeys or | 22 | | property whose
shipments originate or terminate outside | 23 | | Illinois.
| 24 | | Any informal rulings, opinions or letters issued by the | 25 | | Department in
response to an inquiry or request for any opinion | 26 | | from any person
regarding the coverage and applicability of |
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| 1 | | exemption (e) to specific
devices shall be published, | 2 | | maintained as a public record, and made
available for public | 3 | | inspection and copying. If the informal ruling,
opinion or | 4 | | letter contains trade secrets or other confidential
| 5 | | information, where possible the Department shall delete such | 6 | | information
prior to publication. Whenever such informal | 7 | | rulings, opinions, or
letters contain any policy of general | 8 | | applicability, the Department
shall formulate and adopt such | 9 | | policy as a rule in accordance with the
provisions of the | 10 | | Illinois Administrative Procedure Act.
| 11 | | On and after July 1, 1987, no entity otherwise eligible | 12 | | under exemption
(c) of this Section shall make tax free | 13 | | purchases unless it has an active
exemption identification | 14 | | number issued by the Department.
| 15 | | "Serviceman" means any person who is engaged in the | 16 | | occupation of
making sales of service.
| 17 | | Notwithstanding any other provision of law, a | 18 | | not-for-profit organization that (i) has received an exemption | 19 | | under Section 501(c)(3) of the Internal Revenue Code, (ii) has | 20 | | gross receipts of no more than $10,000 per year, and (iii) is | 21 | | organized and operated exclusively for charitable, religious, | 22 | | or educational purposes is not considered a serviceman for the | 23 | | purposes of this Act. | 24 | | "Sale at Retail" means "sale at retail" as defined in the | 25 | | Retailers'
Occupation Tax Act.
| 26 | | "Supplier" means any person who makes sales of tangible |
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| 1 | | personal
property to servicemen for the purpose of resale as an | 2 | | incident to a
sale of service.
| 3 | | (Source: P.A. 98-583, eff. 1-1-14.)
| 4 | | Section 20. The Retailers' Occupation Tax Act is amended by | 5 | | changing Section 1 as follows:
| 6 | | (35 ILCS 120/1) (from Ch. 120, par. 440)
| 7 | | Sec. 1. Definitions. "Sale at retail" means any transfer of | 8 | | the
ownership of or title to
tangible personal property to a | 9 | | purchaser, for the purpose of use or
consumption, and not for | 10 | | the purpose of resale in any form as tangible
personal property | 11 | | to the extent not first subjected to a use for which it
was | 12 | | purchased, for a valuable consideration: Provided that the | 13 | | property
purchased is deemed to be purchased for the purpose of | 14 | | resale, despite
first being used, to the extent to which it is | 15 | | resold as an ingredient of
an intentionally produced product or | 16 | | byproduct of manufacturing. For this
purpose, slag produced as | 17 | | an incident to manufacturing pig iron or steel
and sold is | 18 | | considered to be an intentionally produced byproduct of
| 19 | | manufacturing. Transactions whereby the possession of the | 20 | | property is
transferred but the seller retains the title as | 21 | | security for payment of the
selling price shall be deemed to be | 22 | | sales.
| 23 | | "Sale at retail" shall be construed to include any transfer | 24 | | of the
ownership of or title to tangible personal property to a |
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| 1 | | purchaser, for use
or consumption by any other person to whom | 2 | | such purchaser may transfer the
tangible personal property | 3 | | without a valuable consideration, and to include
any transfer, | 4 | | whether made for or without a valuable consideration, for
| 5 | | resale in any form as tangible personal property unless made in | 6 | | compliance
with Section 2c of this Act.
| 7 | | Sales of tangible personal property, which property, to the | 8 | | extent not
first subjected to a use for which it was purchased, | 9 | | as an ingredient or
constituent, goes into and forms a part of | 10 | | tangible personal property
subsequently the subject of a "Sale | 11 | | at retail", are not sales at retail as
defined in this Act: | 12 | | Provided that the property purchased is deemed to be
purchased | 13 | | for the purpose of resale, despite first being used, to the
| 14 | | extent to which it is resold as an ingredient of an | 15 | | intentionally produced
product or byproduct of manufacturing.
| 16 | | "Sale at retail" shall be construed to include any Illinois | 17 | | florist's
sales transaction in which the purchase order is | 18 | | received in Illinois by a
florist and the sale is for use or | 19 | | consumption, but the Illinois florist
has a florist in another | 20 | | state deliver the property to the purchaser or the
purchaser's | 21 | | donee in such other state.
| 22 | | Nonreusable tangible personal property that is used by | 23 | | persons engaged in
the business of operating a restaurant, | 24 | | cafeteria, or drive-in is a sale for
resale when it is | 25 | | transferred to customers in the ordinary course of business
as | 26 | | part of the sale of food or beverages and is used to deliver, |
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| 1 | | package, or
consume food or beverages, regardless of where | 2 | | consumption of the food or
beverages occurs. Examples of those | 3 | | items include, but are not limited to
nonreusable, paper and | 4 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | 5 | | containers, utensils, straws, placemats, napkins, doggie bags, | 6 | | and
wrapping or packaging
materials that are transferred to | 7 | | customers as part of the sale of food or
beverages in the | 8 | | ordinary course of business.
| 9 | | The purchase, employment and transfer of such tangible | 10 | | personal property
as newsprint and ink for the primary purpose | 11 | | of conveying news (with or
without other information) is not a | 12 | | purchase, use or sale of tangible
personal property.
| 13 | | A person whose activities are organized and conducted | 14 | | primarily as a
not-for-profit service enterprise, and who | 15 | | engages in selling tangible
personal property at retail | 16 | | (whether to the public or merely to members and
their guests) | 17 | | is engaged in the business of selling tangible personal
| 18 | | property at retail with respect to such transactions, excepting | 19 | | only a
person organized and operated exclusively for | 20 | | charitable, religious or
educational purposes either (1), to | 21 | | the extent of sales by such person to
its members, students, | 22 | | patients or inmates of tangible personal property to
be used | 23 | | primarily for the purposes of such person, or (2), to the | 24 | | extent of
sales by such person of tangible personal property | 25 | | which is not sold or
offered for sale by persons organized for | 26 | | profit. The selling of school
books and school supplies by |
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| 1 | | schools at retail to students is not
"primarily for the | 2 | | purposes of" the school which does such selling. The
provisions | 3 | | of this paragraph shall not apply to nor subject to taxation
| 4 | | occasional dinners, socials or similar activities of a person | 5 | | organized and
operated exclusively for charitable, religious | 6 | | or educational purposes,
whether or not such activities are | 7 | | open to the public.
| 8 | | A person who is the recipient of a grant or contract under | 9 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | 10 | | serves meals to
participants in the federal Nutrition Program | 11 | | for the Elderly in return for
contributions established in | 12 | | amount by the individual participant pursuant
to a schedule of | 13 | | suggested fees as provided for in the federal Act is not
| 14 | | engaged in the business of selling tangible personal property | 15 | | at retail
with respect to such transactions.
| 16 | | "Purchaser" means anyone who, through a sale at retail, | 17 | | acquires the
ownership of or title to tangible personal | 18 | | property for a valuable
consideration.
| 19 | | "Reseller of motor fuel" means any person engaged in the | 20 | | business of selling
or delivering or transferring title of | 21 | | motor fuel to another person
other than for use or consumption.
| 22 | | No person shall act as a reseller of motor fuel within this | 23 | | State without
first being registered as a reseller pursuant to | 24 | | Section 2c or a retailer
pursuant to Section 2a.
| 25 | | "Selling price" or the "amount of sale" means the | 26 | | consideration for a
sale valued in money whether received in |
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| 1 | | money or otherwise, including
cash, credits, property, other | 2 | | than as hereinafter provided, and services,
but not including | 3 | | the value of or credit given for traded-in tangible
personal | 4 | | property where the item that is traded-in is of like kind and
| 5 | | character as that which is being sold, and shall be determined | 6 | | without any
deduction on account of the cost of the property | 7 | | sold, the cost of
materials used, labor or service cost or any | 8 | | other expense whatsoever, but
does not include charges that are | 9 | | added to prices by sellers on account of
the seller's tax | 10 | | liability under this Act, or on account of the seller's
duty to | 11 | | collect, from the purchaser, the tax that is imposed by the Use | 12 | | Tax
Act, or, except as otherwise provided with respect to any | 13 | | cigarette tax imposed by a home rule unit, on account of the | 14 | | seller's tax liability under any local occupation tax | 15 | | administered by the Department, or, except as otherwise | 16 | | provided with respect to any cigarette tax imposed by a home | 17 | | rule unit on account of the seller's duty to collect, from the | 18 | | purchasers, the tax that is imposed under any local use tax | 19 | | administered by the Department.
Effective December 1, 1985, | 20 | | "selling price" shall include charges that
are added to prices | 21 | | by sellers on account of the seller's
tax liability under the | 22 | | Cigarette Tax Act, on account of the sellers'
duty to collect, | 23 | | from the purchaser, the tax imposed under the Cigarette
Use Tax | 24 | | Act, and on account of the seller's duty to collect, from the
| 25 | | purchaser, any cigarette tax imposed by a home rule unit.
| 26 | | Notwithstanding any law to the contrary, for any motor |
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| 1 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that | 2 | | is sold on or after January 1, 2015 for the purpose of leasing | 3 | | the vehicle for a defined period that is longer than one year | 4 | | and (1) is a motor vehicle of the second division that: (A) is | 5 | | a self-contained motor vehicle designed or permanently | 6 | | converted to provide living quarters for recreational, | 7 | | camping, or travel use, with direct walk through access to the | 8 | | living quarters from the driver's seat; (B) is of the van | 9 | | configuration designed for the transportation of not less than | 10 | | 7 nor more than 16 passengers; or (C) has a gross vehicle | 11 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle | 12 | | of the first division, "selling price" or "amount of sale" | 13 | | means the consideration received by the lessor pursuant to the | 14 | | lease contract, including amounts due at lease signing and all | 15 | | monthly or other regular payments charged over the term of the | 16 | | lease. Also included in the selling price is any amount | 17 | | received by the lessor from the lessee for the leased vehicle | 18 | | that is not calculated at the time the lease is executed, | 19 | | including, but not limited to, excess mileage charges and | 20 | | charges for excess wear and tear. For sales that occur in | 21 | | Illinois, with respect to any amount received by the lessor | 22 | | from the lessee for the leased vehicle that is not calculated | 23 | | at the time the lease is executed, the lessor who purchased the | 24 | | motor vehicle does not incur the tax imposed by the Use Tax Act | 25 | | on those amounts, and the retailer who makes the retail sale of | 26 | | the motor vehicle to the lessor is not required to collect the |
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| 1 | | tax imposed by the Use Tax Act or to pay the tax imposed by this | 2 | | Act on those amounts. However, the lessor who purchased the | 3 | | motor vehicle assumes the liability for reporting and paying | 4 | | the tax on those amounts directly to the Department in the same | 5 | | form (Illinois Retailers' Occupation Tax, and local retailers' | 6 | | occupation taxes, if applicable) in which the retailer would | 7 | | have reported and paid such tax if the retailer had accounted | 8 | | for the tax to the Department. For amounts received by the | 9 | | lessor from the lessee that are not calculated at the time the | 10 | | lease is executed, the lessor must file the return and pay the | 11 | | tax to the Department by the due date otherwise required by | 12 | | this Act for returns other than transaction returns. If the | 13 | | retailer is entitled under this Act to a discount for | 14 | | collecting and remitting the tax imposed under this Act to the | 15 | | Department with respect to the sale of the motor vehicle to the | 16 | | lessor, then the right to the discount provided in this Act | 17 | | shall be transferred to the lessor with respect to the tax paid | 18 | | by the lessor for any amount received by the lessor from the | 19 | | lessee for the leased vehicle that is not calculated at the | 20 | | time the lease is executed; provided that the discount is only | 21 | | allowed if the return is timely filed and for amounts timely | 22 | | paid. The "selling price" of a motor vehicle that is sold on or | 23 | | after January 1, 2015 for the purpose of leasing for a defined | 24 | | period of longer than one year shall not be reduced by the | 25 | | value of or credit given for traded-in tangible personal | 26 | | property owned by the lessor, nor shall it be reduced by the |
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| 1 | | value of or credit given for traded-in tangible personal | 2 | | property owned by the lessee, regardless of whether the | 3 | | trade-in value thereof is assigned by the lessee to the lessor. | 4 | | In the case of a motor vehicle that is sold for the purpose of | 5 | | leasing for a defined period of longer than one year, the sale | 6 | | occurs at the time of the delivery of the vehicle, regardless | 7 | | of the due date of any lease payments. A lessor who incurs a | 8 | | Retailers' Occupation Tax liability on the sale of a motor | 9 | | vehicle coming off lease may not take a credit against that | 10 | | liability for the Use Tax the lessor paid upon the purchase of | 11 | | the motor vehicle (or for any tax the lessor paid with respect | 12 | | to any amount received by the lessor from the lessee for the | 13 | | leased vehicle that was not calculated at the time the lease | 14 | | was executed) if the selling price of the motor vehicle at the | 15 | | time of purchase was calculated using the definition of | 16 | | "selling price" as defined in this paragraph.
Notwithstanding | 17 | | any other provision of this Act to the contrary, lessors shall | 18 | | file all returns and make all payments required under this | 19 | | paragraph to the Department by electronic means in the manner | 20 | | and form as required by the Department. This paragraph does not | 21 | | apply to leases of motor vehicles for which, at the time the | 22 | | lease is entered into, the term of the lease is not a defined | 23 | | period, including leases with a defined initial period with the | 24 | | option to continue the lease on a month-to-month or other basis | 25 | | beyond the initial defined period. | 26 | | The phrase "like kind and character" shall be liberally |
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| 1 | | construed
(including but not limited to any form of motor | 2 | | vehicle for any form of
motor vehicle, or any kind of farm or | 3 | | agricultural implement for any other
kind of farm or | 4 | | agricultural implement), while not including a kind of item
| 5 | | which, if sold at retail by that retailer, would be exempt from | 6 | | retailers'
occupation tax and use tax as an isolated or | 7 | | occasional sale.
| 8 | | "Gross receipts" from the sales of tangible personal | 9 | | property at retail
means the total selling price or the amount | 10 | | of such sales, as hereinbefore
defined. In the case of charge | 11 | | and time sales, the amount thereof shall be
included only as | 12 | | and when payments are received by the seller.
Receipts or other | 13 | | consideration derived by a seller from
the sale, transfer or | 14 | | assignment of accounts receivable to a wholly owned
subsidiary | 15 | | will not be deemed payments prior to the time the purchaser
| 16 | | makes payment on such accounts.
| 17 | | "Department" means the Department of Revenue.
| 18 | | "Person" means any natural individual, firm, partnership, | 19 | | association,
joint stock company, joint adventure, public or | 20 | | private corporation, limited
liability company, or a receiver, | 21 | | executor, trustee, guardian or other
representative appointed | 22 | | by order of any court.
| 23 | | Notwithstanding any other provision of law, a | 24 | | not-for-profit organization that (i) has received an exemption | 25 | | under Section 501(c)(3) of the Internal Revenue Code, (ii) has | 26 | | gross receipts of no more than $10,000 per year, and (iii) is |
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| 1 | | organized and operated exclusively for charitable, religious, | 2 | | or educational purposes is not considered a retailer for the | 3 | | purposes of this Act. | 4 | | The isolated or occasional sale of tangible personal | 5 | | property at retail
by a person who does not hold himself out as | 6 | | being engaged (or who does not
habitually engage) in selling | 7 | | such tangible personal property at retail, or
a sale through a | 8 | | bulk vending machine, does not constitute engaging in a
| 9 | | business of selling such tangible personal property at retail | 10 | | within the
meaning of this Act; provided that any person who is | 11 | | engaged in a business
which is not subject to the tax imposed | 12 | | by this Act because of involving
the sale of or a contract to | 13 | | sell real estate or a construction contract to
improve real | 14 | | estate or a construction contract to engineer, install, and
| 15 | | maintain an integrated system of products, but who, in the | 16 | | course of
conducting such business,
transfers tangible | 17 | | personal property to users or consumers in the finished
form in | 18 | | which it was purchased, and which does not become real estate | 19 | | or was
not engineered and installed, under any provision of a | 20 | | construction contract or
real estate sale or real estate sales | 21 | | agreement entered into with some other
person arising out of or | 22 | | because of such nontaxable business, is engaged in the
business | 23 | | of selling tangible personal property at retail to the extent | 24 | | of the
value of the tangible personal property so transferred. | 25 | | If, in such a
transaction, a separate charge is made for the | 26 | | tangible personal property so
transferred, the value of such |
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| 1 | | property, for the purpose of this Act, shall be
the amount so | 2 | | separately charged, but not less than the cost of such property
| 3 | | to the transferor; if no separate charge is made, the value of | 4 | | such property,
for the purposes of this Act, is the cost to the | 5 | | transferor of such tangible
personal property. Construction | 6 | | contracts for the improvement of real estate
consisting of | 7 | | engineering, installation, and maintenance of voice, data, | 8 | | video,
security, and all telecommunication systems do not | 9 | | constitute engaging in a
business of selling tangible personal | 10 | | property at retail within the meaning of
this Act if they are | 11 | | sold at one specified contract price.
| 12 | | A person who holds himself or herself out as being engaged | 13 | | (or who habitually
engages) in selling tangible personal | 14 | | property at retail is a person
engaged in the business of | 15 | | selling tangible personal property at retail
hereunder with | 16 | | respect to such sales (and not primarily in a service
| 17 | | occupation) notwithstanding the fact that such person designs | 18 | | and produces
such tangible personal property on special order | 19 | | for the purchaser and in
such a way as to render the property | 20 | | of value only to such purchaser, if
such tangible personal | 21 | | property so produced on special order serves
substantially the | 22 | | same function as stock or standard items of tangible
personal | 23 | | property that are sold at retail.
| 24 | | Persons who engage in the business of transferring tangible | 25 | | personal
property upon the redemption of trading stamps are | 26 | | engaged in the business
of selling such property at retail and |
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| 1 | | shall be liable for and shall pay
the tax imposed by this Act | 2 | | on the basis of the retail value of the
property transferred | 3 | | upon redemption of such stamps.
| 4 | | "Bulk vending machine" means a vending machine,
containing | 5 | | unsorted confections, nuts, toys, or other items designed
| 6 | | primarily to be used or played with by children
which, when a | 7 | | coin or coins of a denomination not larger than $0.50 are
| 8 | | inserted, are dispensed in equal portions, at random and
| 9 | | without selection by the customer.
| 10 | | (Source: P.A. 98-628, eff. 1-1-15; 98-1080, eff. 8-26-14.)
| 11 | | Section 99. Effective date. This Act takes effect upon | 12 | | becoming law.
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