Stay up to date with sales tax: Join our mailing list!


On May 31, 2003 the Illinois General Assembly passed measures that will affect retailers' occupation tax, service occupation tax, service use tax, and use tax. Beginning July 1, 2003, S.B. 842 dictates that a person in the business of buying, leasing , or selling new or used aircraft to others is, for Illinois retailers' occupation tax, service occupation tax, service use tax, and use tax purposes, involved in the business of selling tangible personal property at retail. (S.B. 842, May 31, 2003, effective as noted above)

(06/15/2003)

There are distinct uncertainties regarding the future of the Illinois Certified Audit Program (CAP). The program is designed to allow Illinois firms to hire an outside firm to audit their sales and use tax returns, and in return, have the penalties and interest waived. Enacted in 2001, the authorizing statute faces a sunset provision, which would mean a termination of the program in July 2004. If implemented, it is expected that the program would bring in an additional $2 million or more in the first year, based upon examination of a similar program in another state. The CAP now awaits action by the Director of the Illinois Department of Revenue, after competing bills, one in favor and one against the bill, were both rejected. (Capitol Assets, Future of Certified Audit Program Uncertain, Volume 16, Issue 1, June 11, 2003)

(06/15/2003)

A Pennsylvania corporation doing business in Illinois leased computer equipment in a buyout of its lease commitment. A motion for reconsideration found that they were not entitled to a credit against Illinois use tax equal to the amount the corporation paid in Pennsylvania under the multi-state exemption because the corporation acquired the computer equipment in Illinois. The corporation acquired the property in Illinois because the sale took place more than two years after the equipment arrived in Illinois. The time of transfer of possession was deemed to be irrelevant. Therefore, the transaction did not qualify for the multi-state exemption because the exemption applies to tangible personal property acquired outside Illinois. (Illinois Circuit Court, Cook County, No. 99 L 50577, May 6, 2003.)

(05/15/2003)

A Pennsylvania corporation, doing business in Illinois, purchased leased computer equipment in a buyout of its lease commitment but was not able to receive a credit against its Illinois use tax equal to what was paid in Pennsylvania because the corporation acquired the computer equipment in Illinois. The transaction was disqualified from the multistate exemption because it only applies to tangible personal property acquired outside Illinois. (Sungard Planning Solutions v. Bower, Illinois Circuit Court, Cook County, No. 99 L 50577, May 6, 2003)

(05/15/2003)

A Pennsylvania company, doing business in the state of Illinois, was not allowed to take a credit against its Illinois use tax liability even though it had already paid an equal amount in use tax in the state of Pennsylvania. The corporation purchased the leased computers in an effort to buyout their lease commitment, terminating the lease completely prior to its expiration. However, the equipment was moved from Pennsylvania to Illinois prior to the purchase of the lease being finalized, thus making the entire sale occur in the state of Illinois. It was also found that the company did not remit any Illinois use tax upon purchasing the equipment from the company who leased the computer equipment. (Sungard Planning Solutions v. Bower, Illinois Circuit Court, CookCounty, No. 99 L50577, December 2, 2002)

(03/15/2003)

Pages

Scroll to Top