Beginning January 1, 2025, Illinois retailers must switch from collecting Use Tax (UT) on out-of-state sales to calculating destination-based Retailers’ Occupation Tax (ROT).
Important changes have occurred in the calculation of Illinois state seller’s use tax as of the new year. Starting January 1, 2025, retailers who were previously required to collect and remit Illinois Use Tax (UT) on sales sourced outside of Illinois and made to Illinois customers will now need to calculate destination-based Retailers’ Occupation Tax (ROT).
Take Action
Retailers with a physical presence in Illinois who sell to Illinois customers from outside the state must take action to stay compliant. This may include reviewing your nexus selections and for new ROT tax collections, making sure to change the nexus selection to “Sales tax on All Sales”.
For more information about these Illinois tax changes, refer to the Illinois Department of Revenue site or contact your TaxOps Advisor.
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