- Illinois’ new lease tax effective January 1, 2025, applies to construction equipment leases.
- Tax rate is determined by the property’s primary location as provided by the lessee.
- Both state and local taxes apply to lease receipts.
- Recurring lease payments are taxed based on the property’s location for each payment period.
- Exemptions include motor vehicles, watercraft, aircraft, and semitrailers.
- Trailers and off-road vehicles are subject to the new tax.
- Equipment subject to Chicago’s lease tax is exempt from the new state lease tax.
- Certain sales of leased property for resale are exempt from state and local taxes.
Source: salestaxinstitute.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
