Illinois issued Private Letter Ruling ST 25-0005-PLR addressing the sales and use tax treatment for bone growth stimulation devices. The Department explained that the reduced rate applies to medical appliances serving as a direct substitute for a malfunctioning part of the human body. Diagnostic, treatment, and rehabilitative equipment used to treat patients does not qualify because such equipment does not substitute for body function. The Department concluded that bone growth stimulation devices fall within the non-qualifying treatment equipment category.
Sales tax teams should separate direct-substitute medical appliances from treatment equipment when applying Illinois’ reduced rate. Sellers and purchasers of bone growth stimulation devices should review invoices and taxability settings to ensure the standard rate is being applied. Tax departments should also retain support describing product function and classification for audit file purposes. (Private Letter Ruling ST 25-0005-PLR, Illinois Department of Revenue, (September 5, 2025)