On the heels of the soon the expire general tax amnesty The Illinois Department of Revenue (IDOR) is conducting a program of voluntary disclosure for business use tax.
Use tax is assessed by the state on some businesses who purchase general merchandise, food, drugs or medical appliances. Businesses must pay use tax if they are not charged sales tax or pay a rate less than the use tax rate (6.25%), if they w0uld be subject to sales tax if they purchased from Illinois retailers, or if they purchased applicable items tax free for use in their business but then consumed the items themselves. Local governments such as counties and municipalities may have their own Use Tax statutes that would make the total tax assessment higher. The particulars of use tax liability can be complicated and many businesses may have use tax liabilities they are not aware of.
The voluntary disclosure program began in January with IDOR mailing invitations to 6000 taxpayers identified being highly likely to have unmet use tax liabilities. IDOR has now extended the program generally. Those who voluntarily pay up their use tax liabilities to IDOR will not be assessed penalties.
For more information on how to take advantage of this opportunity, to find out if you have a use tax liability, or for other tax law concerns, contact the Illinois attorneys at Horowitz & Weinstein.