How to Register for a Sales Tax Permit in Illinois

Who Needs a Sales Tax Permit in Illinois

In Illinois, any business that sells tangible personal property or provides taxable services must collect and remit sales tax to the state. This requirement applies to physical storefronts, service providers, and online retailers. 

The economic nexus threshold in Illinois mandates that businesses with over $100,000 in sales or 200 transactions in the state must collect sales tax, even if they don’t have a physical presence there. 

Examples include a local retail store, an electronics repair service, and an out-of-state online retailer that meets the sales threshold.

Steps to Register for a Sales Tax Permit in Illinois

Follow the steps below to register for a sales tax permit in Illinois. 

1. Prepare Your Documents

You will need to provide the following information: 

• Legal Business Name: This should match the name registered with the Illinois Secretary of State.
• Business Location: Provide a physical street address; P.O. boxes are generally not acceptable.
• Federal Employer Identification Number (FEIN): This number is obtainable from the IRS if not already acquired.
• Contact Information: Include names, phone numbers, and email addresses for primary business contacts.
• North American Industry Classification System (NAICS) Code: This determines your business industry.
• Date of Business Start: Specify when your business operations began or will commence in Illinois.

2. Register Online via MyTax Illinois

Visit MyTax Illinois to register. Click on “Register a new business,” accurately provide all required information, review your application thoroughly, and submit it through the portal.

3. Await Approval

Typically, you will receive your account number within 7-10 business days after online registration. Upon approval, you’ll obtain your sales tax permit, allowing you to collect sales tax in Illinois.

The process can seem overwhelming, especially for small business owners trying to manage everything at once. doola’s Bookkeeping services are available to streamline the process, ensuring compliance at every stage. 

Understanding Your Sales Tax Responsibilities in Illinois

Businesses in Illinois typically file sales tax returns monthly, quarterly, or annually depending on their sales volume. Ensuring you apply the correct sales tax rates is essential, as they may vary by state and locality. Illinois offers specific exemptions and rules, such as tax-free periods and the usage of resale certificates, impacting the collection of sales tax.

Common Mistakes to Avoid

• Neglecting to obtain a sales tax permit when required.
• Misapplying sales tax rates for various jurisdictions.
• Failing to meet filing deadlines, resulting in penalties.
• Overlooking exemptions and not documenting resale certificate transactions properly.

How to Maintain Compliance & File Sales Tax Returns

To file sales tax returns in Illinois, log into MyTax Illinois, where you can file returns and remit payments electronically. Consider using automation tools to simplify sales tax collection and ensure accuracy. 

Remember that doola is here to assist with bookkeeping and taxes, ensuring your business remains compliant easily. 

FAQs About Sales Tax Permits in Illinois

How long does it take to get a sales tax permit? 

The processing time for a sales tax permit in Illinois is generally 7-10 business days.

Do I need to renew my sales tax permit? 

Sales tax permits in Illinois typically do not require renewal, provided you continue operations and file returns as required.

What happens if I cease operations in Illinois? 

You must formally close your sales tax account by notifying the Illinois Department of Revenue.

Are online sellers required to collect sales tax in Illinois? 

Yes, if they surpass the $100,000 sales or 200 transactions threshold, online sellers must collect Illinois sales tax.

Stay Compliant With doola 

Registering for a sales tax permit is an important step for any business operating in Illinois. Compliance involves meeting deadlines, collecting accurate sales tax, and understanding exemptions. 

Businesses should consider professional assistance to ensure every aspect is handled correctly. doola is available to guide you through the compliance process, allowing your business to succeed effortlessly. 

Remember to visit the Illinois Department of Revenue website for additional information and resources.