USE TAX-MILITARY-VEHICLES

Illinois General Assembly - Full Text of HB4627

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB4627

Introduced 2/3/2026, by Rep. Joe C. Sosnowski

SYNOPSIS AS INTRODUCED:

35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5
625 ILCS 5/3-1001

from Ch. 95 1/2, par. 3-1001

Amends the Use Tax Act, the Service Use Tax Act, the Service
Occupation Tax Act, the Retailers' Occupation Tax Act, and the Vehicle Use
Tax Article of the Illinois Vehicle Code. Provides that the taxes under
those Acts do not apply to a motor vehicle that is registered in the State
to an Illinois resident who acquired the vehicle while the Illinois
resident was stationed outside of this State as an active duty member of
the military.
LRB104 16313 HLH 29699 b

A BILL FOR

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LRB104 16313 HLH 29699 b
1

AN ACT concerning revenue.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Use Tax Act is amended by changing Section
5
3-5 as follows:

6

(35 ILCS 105/3-5)
7

Sec. 3-5.
Exemptions.
Use, which, on and after January 1,
8
2025, includes use by a lessee, of the following tangible
9
personal property is exempt from the tax imposed by this Act:
10

(1) Personal property purchased from a corporation,
11
society, association, foundation, institution, or
12
organization, other than a limited liability company, that is
13
organized and operated as a not-for-profit service enterprise
14
for the benefit of persons 65 years of age or older if the
15
personal property was not purchased by the enterprise for the
16
purpose of resale by the enterprise.
17

(2) Personal property purchased by a not-for-profit
18
Illinois county fair association for use in conducting,
19
operating, or promoting the county fair.
20

(3) Personal property purchased by a not-for-profit arts
21
or cultural organization that establishes, by proof required
22
by the Department by rule, that it has received an exemption
23
under Section 501(c)(3) of the Internal Revenue Code and that

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1
is organized and operated primarily for the presentation or
2
support of arts or cultural programming, activities, or
3
services. These organizations include, but are not limited to,
4
music and dramatic arts organizations such as symphony
5
orchestras and theatrical groups, arts and cultural service
6
organizations, local arts councils, visual arts organizations,
7
and media arts organizations. On and after July 1, 2001 (the
8
effective date of Public Act 92-35), however, an entity
9
otherwise eligible for this exemption shall not make tax-free
10
purchases unless it has an active identification number issued
11
by the Department.
12

(4) Except as otherwise provided in this Act, personal
13
property purchased by a governmental body, by a corporation,
14
society, association, foundation, or institution organized and
15
operated exclusively for charitable, religious, or educational
16
purposes, or by a not-for-profit corporation, society,
17
association, foundation, institution, or organization that has
18
no compensated officers or employees and that is organized and
19
operated primarily for the recreation of persons 55 years of
20
age or older. A limited liability company may qualify for the
21
exemption under this paragraph only if the limited liability
22
company is organized and operated exclusively for educational
23
purposes. On and after July 1, 1987, however, no entity
24
otherwise eligible for this exemption shall make tax-free
25
purchases unless it has an active exemption identification
26
number issued by the Department.

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(5) Until July 1, 2003, a passenger car that is a
2
replacement vehicle to the extent that the purchase price of
3
the car is subject to the Replacement Vehicle Tax.
4

(6) Until July 1, 2003 and beginning again on September 1,
5
2004 through August 30, 2014, graphic arts machinery and
6
equipment, including repair and replacement parts, both new
7
and used, and including that manufactured on special order,
8
certified by the purchaser to be used primarily for graphic
9
arts production, and including machinery and equipment
10
purchased for lease. Equipment includes chemicals or chemicals
11
acting as catalysts but only if the chemicals or chemicals
12
acting as catalysts effect a direct and immediate change upon
13
a graphic arts product. Beginning on July 1, 2017, graphic
14
arts machinery and equipment is included in the manufacturing
15
and assembling machinery and equipment exemption under
16
paragraph (18).
17

(7) Farm chemicals.
18

(8) Legal tender, currency, medallions, or gold or silver
19
coinage issued by the State of Illinois, the government of the
20
United States of America, or the government of any foreign
21
country, and bullion.
22

(9) Personal property purchased from a teacher-sponsored
23
student organization affiliated with an elementary or
24
secondary school located in Illinois.
25

(10) A motor vehicle that is used for automobile renting,
26
as defined in the Automobile Renting Occupation and Use Tax

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Act.
2

(11) Farm machinery and equipment, both new and used,
3
including that manufactured on special order, certified by the
4
purchaser to be used primarily for production agriculture or
5
State or federal agricultural programs, including individual
6
replacement parts for the machinery and equipment, including
7
machinery and equipment purchased for lease, and including
8
implements of husbandry defined in Section 1-130 of the
9
Illinois Vehicle Code, farm machinery and agricultural
10
chemical and fertilizer spreaders, and nurse wagons required
11
to be registered under Section 3-809 of the Illinois Vehicle
12
Code, but excluding other motor vehicles required to be
13
registered under the Illinois Vehicle Code. Horticultural
14
polyhouses or hoop houses used for propagating, growing, or
15
overwintering plants shall be considered farm machinery and
16
equipment under this item (11). Agricultural chemical tender
17
tanks and dry boxes shall include units sold separately from a
18
motor vehicle required to be licensed and units sold mounted
19
on a motor vehicle required to be licensed if the selling price
20
of the tender is separately stated.
21

Farm machinery and equipment shall include precision
22
farming equipment that is installed or purchased to be
23
installed on farm machinery and equipment, including, but not
24
limited to, tractors, harvesters, sprayers, planters, seeders,
25
or spreaders. Precision farming equipment includes, but is not
26
limited to, soil testing sensors, computers, monitors,

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1
software, global positioning and mapping systems, and other
2
such equipment.
3

Farm machinery and equipment also includes computers,
4
sensors, software, and related equipment used primarily in the
5
computer-assisted operation of production agriculture
6
facilities, equipment, and activities such as, but not limited
7
to, the collection, monitoring, and correlation of animal and
8
crop data for the purpose of formulating animal diets and
9
agricultural chemicals.
10

Beginning on January 1, 2024, farm machinery and equipment
11
also includes electrical power generation equipment used
12
primarily for production agriculture.
13

This item (11) is exempt from the provisions of Section
14
3-90.
15

(12) Until June 30, 2013, fuel and petroleum products sold
16
to or used by an air common carrier, certified by the carrier
17
to be used for consumption, shipment, or storage in the
18
conduct of its business as an air common carrier, for a flight
19
destined for or returning from a location or locations outside
20
the United States without regard to previous or subsequent
21
domestic stopovers.
22

Beginning July 1, 2013, fuel and petroleum products sold
23
to or used by an air carrier, certified by the carrier to be
24
used for consumption, shipment, or storage in the conduct of
25
its business as an air common carrier, for a flight that (i) is
26
engaged in foreign trade or is engaged in trade between the

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United States and any of its possessions and (ii) transports
2
at least one individual or package for hire from the city of
3
origination to the city of final destination on the same
4
aircraft, without regard to a change in the flight number of
5
that aircraft.
6

(13) Proceeds of mandatory service charges separately
7
stated on customers' bills for the purchase and consumption of
8
food and beverages purchased at retail from a retailer, to the
9
extent that the proceeds of the service charge are in fact
10
turned over as tips or as a substitute for tips to the
11
employees who participate directly in preparing, serving,
12
hosting or cleaning up the food or beverage function with
13
respect to which the service charge is imposed.
14

(14) Until July 1, 2003, oil field exploration, drilling,
15
and production equipment, including (i) rigs and parts of
16
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
17
pipe and tubular goods, including casing and drill strings,
18
(iii) pumps and pump-jack units, (iv) storage tanks and flow
19
lines, (v) any individual replacement part for oil field
20
exploration, drilling, and production equipment, and (vi)
21
machinery and equipment purchased for lease; but excluding
22
motor vehicles required to be registered under the Illinois
23
Vehicle Code.
24

(15) Photoprocessing machinery and equipment, including
25
repair and replacement parts, both new and used, including
26
that manufactured on special order, certified by the purchaser

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to be used primarily for photoprocessing, and including
2
photoprocessing machinery and equipment purchased for lease.
3

(16) Until July 1, 2028, coal and aggregate exploration,
4
mining, off-highway hauling, processing, maintenance, and
5
reclamation equipment, including replacement parts and
6
equipment, and including equipment purchased for lease, but
7
excluding motor vehicles required to be registered under the
8
Illinois Vehicle Code. The changes made to this Section by
9
Public Act 97-767 apply on and after July 1, 2003, but no claim
10
for credit or refund is allowed on or after August 16, 2013
11
(the effective date of Public Act 98-456) for such taxes paid
12
during the period beginning July 1, 2003 and ending on August
13
16, 2013 (the effective date of Public Act 98-456).
14

(17) Until July 1, 2003, distillation machinery and
15
equipment, sold as a unit or kit, assembled or installed by the
16
retailer, certified by the user to be used only for the
17
production of ethyl alcohol that will be used for consumption
18
as motor fuel or as a component of motor fuel for the personal
19
use of the user, and not subject to sale or resale.
20

(18) Manufacturing and assembling machinery and equipment
21
used primarily in the process of manufacturing or assembling
22
tangible personal property for wholesale or retail sale or
23
lease, whether that sale or lease is made directly by the
24
manufacturer or by some other person, whether the materials
25
used in the process are owned by the manufacturer or some other
26
person, or whether that sale or lease is made apart from or as

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an incident to the seller's engaging in the service occupation
2
of producing machines, tools, dies, jigs, patterns, gauges, or
3
other similar items of no commercial value on special order
4
for a particular purchaser. The exemption provided by this
5
paragraph (18) includes production related tangible personal
6
property, as defined in Section 3-50, purchased on or after
7
July 1, 2019. The exemption provided by this paragraph (18)
8
does not include machinery and equipment used in (i) the
9
generation of electricity for wholesale or retail sale; (ii)
10
the generation or treatment of natural or artificial gas for
11
wholesale or retail sale that is delivered to customers
12
through pipes, pipelines, or mains; or (iii) the treatment of
13
water for wholesale or retail sale that is delivered to
14
customers through pipes, pipelines, or mains. The provisions
15
of Public Act 98-583 are declaratory of existing law as to the
16
meaning and scope of this exemption. Beginning on July 1,
17
2017, the exemption provided by this paragraph (18) includes,
18
but is not limited to, graphic arts machinery and equipment,
19
as defined in paragraph (6) of this Section.
20

(19) Personal property delivered to a purchaser or
21
purchaser's donee inside Illinois when the purchase order for
22
that personal property was received by a florist located
23
outside Illinois who has a florist located inside Illinois
24
deliver the personal property.
25

(20) Semen used for artificial insemination of livestock
26
for direct agricultural production.

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1

(21) Horses, or interests in horses, registered with and
2
meeting the requirements of any of the Arabian Horse Club
3
Registry of America, Appaloosa Horse Club, American Quarter
4
Horse Association, United States Trotting Association, or
5
Jockey Club, as appropriate, used for purposes of breeding or
6
racing for prizes. This item (21) is exempt from the
7
provisions of Section 3-90, and the exemption provided for
8
under this item (21) applies for all periods beginning May 30,
9
1995, but no claim for credit or refund is allowed on or after
10
January 1, 2008 for such taxes paid during the period
11
beginning May 30, 2000 and ending on January 1, 2008.
12

(22) Computers and communications equipment utilized for
13
any hospital purpose and equipment used in the diagnosis,
14
analysis, or treatment of hospital patients purchased by a
15
lessor who leases the equipment, under a lease of one year or
16
longer executed or in effect at the time the lessor would
17
otherwise be subject to the tax imposed by this Act, to a
18
hospital that has been issued an active tax exemption
19
identification number by the Department under Section 1g of
20
the Retailers' Occupation Tax Act. If the equipment is leased
21
in a manner that does not qualify for this exemption or is used
22
in any other non-exempt manner, the lessor shall be liable for
23
the tax imposed under this Act or the Service Use Tax Act, as
24
the case may be, based on the fair market value of the property
25
at the time the non-qualifying use occurs. No lessor shall
26
collect or attempt to collect an amount (however designated)

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1
that purports to reimburse that lessor for the tax imposed by
2
this Act or the Service Use Tax Act, as the case may be, if the
3
tax has not been paid by the lessor. If a lessor improperly
4
collects any such amount from the lessee, the lessee shall
5
have a legal right to claim a refund of that amount from the
6
lessor. If, however, that amount is not refunded to the lessee
7
for any reason, the lessor is liable to pay that amount to the
8
Department.
9

(23) Personal property purchased by a lessor who leases
10
the property, under a lease of one year or longer executed or
11
in effect at the time the lessor would otherwise be subject to
12
the tax imposed by this Act, to a governmental body that has
13
been issued an active sales tax exemption identification
14
number by the Department under Section 1g of the Retailers'
15
Occupation Tax Act. If the property is leased in a manner that
16
does not qualify for this exemption or used in any other
17
non-exempt manner, the lessor shall be liable for the tax
18
imposed under this Act or the Service Use Tax Act, as the case
19
may be, based on the fair market value of the property at the
20
time the non-qualifying use occurs. No lessor shall collect or
21
attempt to collect an amount (however designated) that
22
purports to reimburse that lessor for the tax imposed by this
23
Act or the Service Use Tax Act, as the case may be, if the tax
24
has not been paid by the lessor. If a lessor improperly
25
collects any such amount from the lessee, the lessee shall
26
have a legal right to claim a refund of that amount from the

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LRB104 16313 HLH 29699 b
1
lessor. If, however, that amount is not refunded to the lessee
2
for any reason, the lessor is liable to pay that amount to the
3
Department.
4

(24) Beginning with taxable years ending on or after
5
December 31, 1995 and ending with taxable years ending on or
6
before December 31, 2004, personal property that is donated
7
for disaster relief to be used in a State or federally declared
8
disaster area in Illinois or bordering Illinois by a
9
manufacturer or retailer that is registered in this State to a
10
corporation, society, association, foundation, or institution
11
that has been issued a sales tax exemption identification
12
number by the Department that assists victims of the disaster
13
who reside within the declared disaster area.
14

(25) Beginning with taxable years ending on or after
15
December 31, 1995 and ending with taxable years ending on or
16
before December 31, 2004, personal property that is used in
17
the performance of infrastructure repairs in this State,
18
including, but not limited to, municipal roads and streets,
19
access roads, bridges, sidewalks, waste disposal systems,
20
water and sewer line extensions, water distribution and
21
purification facilities, storm water drainage and retention
22
facilities, and sewage treatment facilities, resulting from a
23
State or federally declared disaster in Illinois or bordering
24
Illinois when such repairs are initiated on facilities located
25
in the declared disaster area within 6 months after the
26
disaster.

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1

(26) Beginning July 1, 1999, game or game birds purchased
2
at a "game breeding and hunting preserve area" as that term is
3
used in the Wildlife Code. This paragraph is exempt from the
4
provisions of Section 3-90.
5

(27) A motor vehicle, as that term is defined in Section
6
1-146 of the Illinois Vehicle Code, that is donated to a
7
corporation, limited liability company, society, association,
8
foundation, or institution that is determined by the
9
Department to be organized and operated exclusively for
10
educational purposes. For purposes of this exemption, "a
11
corporation, limited liability company, society, association,
12
foundation, or institution organized and operated exclusively
13
for educational purposes" means all tax-supported public
14
schools, private schools that offer systematic instruction in
15
useful branches of learning by methods common to public
16
schools and that compare favorably in their scope and
17
intensity with the course of study presented in tax-supported
18
schools, and vocational or technical schools or institutes
19
organized and operated exclusively to provide a course of
20
study of not less than 6 weeks duration and designed to prepare
21
individuals to follow a trade or to pursue a manual,
22
technical, mechanical, industrial, business, or commercial
23
occupation.
24

(28) Beginning January 1, 2000, personal property,
25
including food, purchased through fundraising events for the
26
benefit of a public or private elementary or secondary school,

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LRB104 16313 HLH 29699 b
1
a group of those schools, or one or more school districts if
2
the events are sponsored by an entity recognized by the school
3
district that consists primarily of volunteers and includes
4
parents and teachers of the school children. This paragraph
5
does not apply to fundraising events (i) for the benefit of
6
private home instruction or (ii) for which the fundraising
7
entity purchases the personal property sold at the events from
8
another individual or entity that sold the property for the
9
purpose of resale by the fundraising entity and that profits
10
from the sale to the fundraising entity. This paragraph is
11
exempt from the provisions of Section 3-90.
12

(29) Beginning January 1, 2000 and through December 31,
13
2001, new or used automatic vending machines that prepare and
14
serve hot food and beverages, including coffee, soup, and
15
other items, and replacement parts for these machines.
16
Beginning January 1, 2002 and through June 30, 2003, machines
17
and parts for machines used in commercial, coin-operated
18
amusement and vending business if a use or occupation tax is
19
paid on the gross receipts derived from the use of the
20
commercial, coin-operated amusement and vending machines. This
21
paragraph is exempt from the provisions of Section 3-90.
22

(30) Beginning January 1, 2001 and through June 30, 2016,
23
food for human consumption that is to be consumed off the
24
premises where it is sold (other than alcoholic beverages,
25
soft drinks, and food that has been prepared for immediate
26
consumption) and prescription and nonprescription medicines,

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LRB104 16313 HLH 29699 b
1
drugs, medical appliances, and insulin, urine testing
2
materials, syringes, and needles used by diabetics, for human
3
use, when purchased for use by a person receiving medical
4
assistance under Article V of the Illinois Public Aid Code who
5
resides in a licensed long-term care facility, as defined in
6
the Nursing Home Care Act, or in a licensed facility as defined
7
in the ID/DD Community Care Act, the MC/DD Act, or the
8
Specialized Mental Health Rehabilitation Act of 2013.
9

(31) Beginning on August 2, 2001 (the effective date of
10
Public Act 92-227), computers and communications equipment
11
utilized for any hospital purpose and equipment used in the
12
diagnosis, analysis, or treatment of hospital patients
13
purchased by a lessor who leases the equipment, under a lease
14
of one year or longer executed or in effect at the time the
15
lessor would otherwise be subject to the tax imposed by this
16
Act, to a hospital that has been issued an active tax exemption
17
identification number by the Department under Section 1g of
18
the Retailers' Occupation Tax Act. If the equipment is leased
19
in a manner that does not qualify for this exemption or is used
20
in any other nonexempt manner, the lessor shall be liable for
21
the tax imposed under this Act or the Service Use Tax Act, as
22
the case may be, based on the fair market value of the property
23
at the time the nonqualifying use occurs. No lessor shall
24
collect or attempt to collect an amount (however designated)
25
that purports to reimburse that lessor for the tax imposed by
26
this Act or the Service Use Tax Act, as the case may be, if the

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LRB104 16313 HLH 29699 b
1
tax has not been paid by the lessor. If a lessor improperly
2
collects any such amount from the lessee, the lessee shall
3
have a legal right to claim a refund of that amount from the
4
lessor. If, however, that amount is not refunded to the lessee
5
for any reason, the lessor is liable to pay that amount to the
6
Department. This paragraph is exempt from the provisions of
7
Section 3-90.
8

(32) Beginning on August 2, 2001 (the effective date of
9
Public Act 92-227), personal property purchased by a lessor
10
who leases the property, under a lease of one year or longer
11
executed or in effect at the time the lessor would otherwise be
12
subject to the tax imposed by this Act, to a governmental body
13
that has been issued an active sales tax exemption
14
identification number by the Department under Section 1g of
15
the Retailers' Occupation Tax Act. If the property is leased
16
in a manner that does not qualify for this exemption or used in
17
any other nonexempt manner, the lessor shall be liable for the
18
tax imposed under this Act or the Service Use Tax Act, as the
19
case may be, based on the fair market value of the property at
20
the time the nonqualifying use occurs. No lessor shall collect
21
or attempt to collect an amount (however designated) that
22
purports to reimburse that lessor for the tax imposed by this
23
Act or the Service Use Tax Act, as the case may be, if the tax
24
has not been paid by the lessor. If a lessor improperly
25
collects any such amount from the lessee, the lessee shall
26
have a legal right to claim a refund of that amount from the

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LRB104 16313 HLH 29699 b
1
lessor. If, however, that amount is not refunded to the lessee
2
for any reason, the lessor is liable to pay that amount to the
3
Department. This paragraph is exempt from the provisions of
4
Section 3-90.
5

(33) On and after July 1, 2003 and through June 30, 2004,
6
the use in this State of motor vehicles of the second division
7
with a gross vehicle weight in excess of 8,000 pounds and that
8
are subject to the commercial distribution fee imposed under
9
Section 3-815.1 of the Illinois Vehicle Code. Beginning on
10
July 1, 2004 and through June 30, 2005, the use in this State
11
of motor vehicles of the second division: (i) with a gross
12
vehicle weight rating in excess of 8,000 pounds; (ii) that are
13
subject to the commercial distribution fee imposed under
14
Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
15
are primarily used for commercial purposes. Through June 30,
16
2005, this exemption applies to repair and replacement parts
17
added after the initial purchase of such a motor vehicle if
18
that motor vehicle is used in a manner that would qualify for
19
the rolling stock exemption otherwise provided for in this
20
Act. For purposes of this paragraph, the term "used for
21
commercial purposes" means the transportation of persons or
22
property in furtherance of any commercial or industrial
23
enterprise, whether for-hire or not.
24

(34) Beginning January 1, 2008, tangible personal property
25
used in the construction or maintenance of a community water
26
supply, as defined under Section 3.145 of the Environmental

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Protection Act, that is operated by a not-for-profit
2
corporation that holds a valid water supply permit issued
3
under Title IV of the Environmental Protection Act. This
4
paragraph is exempt from the provisions of Section 3-90.
5

(35) Beginning January 1, 2010 and continuing through
6
December 31, 2029, materials, parts, equipment, components,
7
and furnishings incorporated into or upon an aircraft as part
8
of the modification, refurbishment, completion, replacement,
9
repair, or maintenance of the aircraft. This exemption
10
includes consumable supplies used in the modification,
11
refurbishment, completion, replacement, repair, and
12
maintenance of aircraft. However, until January 1, 2024, this
13
exemption excludes any materials, parts, equipment,
14
components, and consumable supplies used in the modification,
15
replacement, repair, and maintenance of aircraft engines or
16
power plants, whether such engines or power plants are
17
installed or uninstalled upon any such aircraft. "Consumable
18
supplies" include, but are not limited to, adhesive, tape,
19
sandpaper, general purpose lubricants, cleaning solution,
20
latex gloves, and protective films.
21

Beginning January 1, 2010 and continuing through December
22
31, 2023, this exemption applies only to the use of qualifying
23
tangible personal property by persons who modify, refurbish,
24
complete, repair, replace, or maintain aircraft and who (i)
25
hold an Air Agency Certificate and are empowered to operate an
26
approved repair station by the Federal Aviation

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Administration, (ii) have a Class IV Rating, and (iii) conduct
2
operations in accordance with Part 145 of the Federal Aviation
3
Regulations. From January 1, 2024 through December 31, 2029,
4
this exemption applies only to the use of qualifying tangible
5
personal property by: (A) persons who modify, refurbish,
6
complete, repair, replace, or maintain aircraft and who (i)
7
hold an Air Agency Certificate and are empowered to operate an
8
approved repair station by the Federal Aviation
9
Administration, (ii) have a Class IV Rating, and (iii) conduct
10
operations in accordance with Part 145 of the Federal Aviation
11
Regulations; and (B) persons who engage in the modification,
12
replacement, repair, and maintenance of aircraft engines or
13
power plants without regard to whether or not those persons
14
meet the qualifications of item (A).
15

The exemption does not include aircraft operated by a
16
commercial air carrier providing scheduled passenger air
17
service pursuant to authority issued under Part 121 or Part
18
129 of the Federal Aviation Regulations. The changes made to
19
this paragraph (35) by Public Act 98-534 are declarative of
20
existing law. It is the intent of the General Assembly that the
21
exemption under this paragraph (35) applies continuously from
22
January 1, 2010 through December 31, 2024; however, no claim
23
for credit or refund is allowed for taxes paid as a result of
24
the disallowance of this exemption on or after January 1, 2015
25
and prior to February 5, 2020 (the effective date of Public Act
26
101-629).

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(36) Tangible personal property purchased by a
2
public-facilities corporation, as described in Section
3
11-65-10 of the Illinois Municipal Code, for purposes of
4
constructing or furnishing a municipal convention hall, but
5
only if the legal title to the municipal convention hall is
6
transferred to the municipality without any further
7
consideration by or on behalf of the municipality at the time
8
of the completion of the municipal convention hall or upon the
9
retirement or redemption of any bonds or other debt
10
instruments issued by the public-facilities corporation in
11
connection with the development of the municipal convention
12
hall. This exemption includes existing public-facilities
13
corporations as provided in Section 11-65-25 of the Illinois
14
Municipal Code. This paragraph is exempt from the provisions
15
of Section 3-90.
16

(37) Beginning January 1, 2017 and through December 31,
17
2026, menstrual pads, tampons, and menstrual cups.
18

(38) Merchandise that is subject to the Rental Purchase
19
Agreement Occupation and Use Tax. The purchaser must certify
20
that the item is purchased to be rented subject to a
21
rental-purchase agreement, as defined in the Rental-Purchase
22
Agreement Act, and provide proof of registration under the
23
Rental Purchase Agreement Occupation and Use Tax Act. This
24
paragraph is exempt from the provisions of Section 3-90.
25

(39) Tangible personal property purchased by a purchaser
26
who is exempt from the tax imposed by this Act by operation of

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federal law. This paragraph is exempt from the provisions of
2
Section 3-90.
3

(40) Qualified tangible personal property used in the
4
construction or operation of a data center that has been
5
granted a certificate of exemption by the Department of
6
Commerce and Economic Opportunity, whether that tangible
7
personal property is purchased by the owner, operator, or
8
tenant of the data center or by a contractor or subcontractor
9
of the owner, operator, or tenant. Data centers that would
10
have qualified for a certificate of exemption prior to January
11
1, 2020 had Public Act 101-31 been in effect may apply for and
12
obtain an exemption for subsequent purchases of computer
13
equipment or enabling software purchased or leased to upgrade,
14
supplement, or replace computer equipment or enabling software
15
purchased or leased in the original investment that would have
16
qualified.
17

The Department of Commerce and Economic Opportunity shall
18
grant a certificate of exemption under this item (40) to
19
qualified data centers as defined by Section 605-1025 of the
20
Department of Commerce and Economic Opportunity Law of the
21
Civil Administrative Code of Illinois.
22

For the purposes of this item (40):
23

"Data center" means a building or a series of
24

buildings rehabilitated or constructed to house working
25

servers in one physical location or multiple sites within
26

the State of Illinois.

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"Qualified tangible personal property" means:
2

electrical systems and equipment; climate control and
3

chilling equipment and systems; mechanical systems and
4

equipment; monitoring and secure systems; emergency
5

generators; hardware; computers; servers; data storage
6

devices; network connectivity equipment; racks; cabinets;
7

telecommunications cabling infrastructure; raised floor
8

systems; peripheral components or systems; software;
9

mechanical, electrical, or plumbing systems; battery
10

systems; cooling systems and towers; temperature control
11

systems; other cabling; and other data center
12

infrastructure equipment and systems necessary to operate
13

qualified tangible personal property, including fixtures;
14

and component parts of any of the foregoing, including
15

installation, maintenance, repair, refurbishment, and
16

replacement of qualified tangible personal property to
17

generate, transform, transmit, distribute, or manage
18

electricity necessary to operate qualified tangible
19

personal property; and all other tangible personal
20

property that is essential to the operations of a computer
21

data center. The term "qualified tangible personal
22

property" also includes building materials physically
23

incorporated into the qualifying data center. To document
24

the exemption allowed under this Section, the retailer
25

must obtain from the purchaser a copy of the certificate
26

of eligibility issued by the Department of Commerce and

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Economic Opportunity.
2

This item (40) is exempt from the provisions of Section
3
3-90.
4

(41) Beginning July 1, 2022, breast pumps, breast pump
5
collection and storage supplies, and breast pump kits. This
6
item (41) is exempt from the provisions of Section 3-90. As
7
used in this item (41):
8

"Breast pump" means an electrically controlled or
9

manually controlled pump device designed or marketed to be
10

used to express milk from a human breast during lactation,
11

including the pump device and any battery, AC adapter, or
12

other power supply unit that is used to power the pump
13

device and is packaged and sold with the pump device at the
14

time of sale.
15

"Breast pump collection and storage supplies" means
16

items of tangible personal property designed or marketed
17

to be used in conjunction with a breast pump to collect
18

milk expressed from a human breast and to store collected
19

milk until it is ready for consumption.
20

"Breast pump collection and storage supplies"
21

includes, but is not limited to: breast shields and breast
22

shield connectors; breast pump tubes and tubing adapters;
23

breast pump valves and membranes; backflow protectors and
24

backflow protector adaptors; bottles and bottle caps
25

specific to the operation of the breast pump; and breast
26

milk storage bags.

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"Breast pump collection and storage supplies" does not
2

include: (1) bottles and bottle caps not specific to the
3

operation of the breast pump; (2) breast pump travel bags
4

and other similar carrying accessories, including ice
5

packs, labels, and other similar products; (3) breast pump
6

cleaning supplies; (4) nursing bras, bra pads, breast
7

shells, and other similar products; and (5) creams,
8

ointments, and other similar products that relieve
9

breastfeeding-related symptoms or conditions of the
10

breasts or nipples, unless sold as part of a breast pump
11

kit that is pre-packaged by the breast pump manufacturer
12

or distributor.
13

"Breast pump kit" means a kit that: (1) contains no
14

more than a breast pump, breast pump collection and
15

storage supplies, a rechargeable battery for operating the
16

breast pump, a breastmilk cooler, bottle stands, ice
17

packs, and a breast pump carrying case; and (2) is
18

pre-packaged as a breast pump kit by the breast pump
19

manufacturer or distributor.
20

(42) Tangible personal property sold by or on behalf of
21
the State Treasurer pursuant to the Revised Uniform Unclaimed
22
Property Act. This item (42) is exempt from the provisions of
23
Section 3-90.
24

(43) Beginning on January 1, 2024, tangible personal
25
property purchased by an active duty member of the armed
26
forces of the United States who presents valid military

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identification and purchases the property using a form of
2
payment where the federal government is the payor. The member
3
of the armed forces must complete, at the point of sale, a form
4
prescribed by the Department of Revenue documenting that the
5
transaction is eligible for the exemption under this
6
paragraph. Retailers must keep the form as documentation of
7
the exemption in their records for a period of not less than 6
8
years. "Armed forces of the United States" means the United
9
States Army, Navy, Air Force, Space Force, Marine Corps, or
10
Coast Guard. This paragraph is exempt from the provisions of
11
Section 3-90.
12

(44) Beginning July 1, 2024, home-delivered meals provided
13
to Medicare or Medicaid recipients when payment is made by an
14
intermediary, such as a Medicare Administrative Contractor, a
15
Managed Care Organization, or a Medicare Advantage
16
Organization, pursuant to a government contract. This item
17
(44) is exempt from the provisions of Section 3-90.
18

(45) Beginning on January 1, 2026, as further defined in
19
Section 3-10, food for human consumption that is to be
20
consumed off the premises where it is sold (other than
21
alcoholic beverages, food consisting of or infused with adult
22
use cannabis, soft drinks, candy, and food that has been
23
prepared for immediate consumption). This item (45) is exempt
24
from the provisions of Section 3-90.
25

(46) Use by the lessee of the following leased tangible
26
personal property:

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(1) software transferred subject to a license that
2

meets the following requirements:
3

(A) it is evidenced by a written agreement signed
4

by the licensor and the customer;
5

(i) an electronic agreement in which the
6

customer accepts the license by means of an
7

electronic signature that is verifiable and can be
8

authenticated and is attached to or made part of
9

the license will comply with this requirement;
10

(ii) a license agreement in which the customer
11

electronically accepts the terms by clicking "I
12

agree" does not comply with this requirement;
13

(B) it restricts the customer's duplication and
14

use of the software;
15

(C) it prohibits the customer from licensing,
16

sublicensing, or transferring the software to a third
17

party (except to a related party) without the
18

permission and continued control of the licensor;
19

(D) the licensor has a policy of providing another
20

copy at minimal or no charge if the customer loses or
21

damages the software, or of permitting the licensee to
22

make and keep an archival copy, and such policy is
23

either stated in the license agreement, supported by
24

the licensor's books and records, or supported by a
25

notarized statement made under penalties of perjury by
26

the licensor; and

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(E) the customer must destroy or return all copies
2

of the software to the licensor at the end of the
3

license period; this provision is deemed to be met, in
4

the case of a perpetual license, without being set
5

forth in the license agreement; and
6

(2) property that is subject to a tax on lease
7

receipts imposed by a home rule unit of local government
8

if the ordinance imposing that tax was adopted prior to
9

January 1, 2023.
10

(47) A motor vehicle of the first division, as defined in
11
Section 1-146 of the Illinois Vehicle Code, that is registered
12
in the State to an Illinois resident who acquired the vehicle
13
while the Illinois resident was stationed outside of this
14
State as an active duty member of the military. This item (47)
15
is exempt from the provisions of Section 3-90.

16

As used in this item (47):

17

"Active duty member of the military" means a service
18
member who undertakes any full-time military training or
19
full-time military duty, no matter how described under federal
20
or State law, for which a service member is ordered to report
21
by the President, by the Governor of a state, commonwealth, or
22
territory of the United States, by an act of Congress, or by
23
any other appropriate military authority.

24

"Illinois resident" means an individual who meets the
25
definition of "resident" under subparagraph (A) of paragraph
26
(20) of subsection (a) of Section 1501 of the Illinois Income

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Tax Act.

2

"Service member" means a person who is a member of any
3
component of the United States Armed Forces or the National
4
Guard of any state, the District of Columbia, a commonwealth,
5
or a territory of the United States.

6
(Source: P.A. 103-9, Article 5, Section 5-5, eff. 6-7-23;
7
103-9, Article 15, Section 15-5, eff. 6-7-23; 103-154, eff.
8
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
9
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
10
103-781, eff. 8-5-24; 104-417, eff. 8-15-25.)

11

Section 10.
The Service Use Tax Act is amended by changing
12
Section 3-5 as follows:

13

(35 ILCS 110/3-5)
14

Sec. 3-5.
Exemptions.
Use of the following tangible
15
personal property is exempt from the tax imposed by this Act:
16

(1) Personal property purchased from a corporation,
17
society, association, foundation, institution, or
18
organization, other than a limited liability company, that is
19
organized and operated as a not-for-profit service enterprise
20
for the benefit of persons 65 years of age or older if the
21
personal property was not purchased by the enterprise for the
22
purpose of resale by the enterprise.
23

(2) Personal property purchased by a non-profit Illinois
24
county fair association for use in conducting, operating, or

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promoting the county fair.
2

(3) Personal property purchased by a not-for-profit arts
3
or cultural organization that establishes, by proof required
4
by the Department by rule, that it has received an exemption
5
under Section 501(c)(3) of the Internal Revenue Code and that
6
is organized and operated primarily for the presentation or
7
support of arts or cultural programming, activities, or
8
services. These organizations include, but are not limited to,
9
music and dramatic arts organizations such as symphony
10
orchestras and theatrical groups, arts and cultural service
11
organizations, local arts councils, visual arts organizations,
12
and media arts organizations. On and after July 1, 2001 (the
13
effective date of Public Act 92-35), however, an entity
14
otherwise eligible for this exemption shall not make tax-free
15
purchases unless it has an active identification number issued
16
by the Department.
17

(4) Legal tender, currency, medallions, or gold or silver
18
coinage issued by the State of Illinois, the government of the
19
United States of America, or the government of any foreign
20
country, and bullion.
21

(5) Until July 1, 2003 and beginning again on September 1,
22
2004 through August 30, 2014, graphic arts machinery and
23
equipment, including repair and replacement parts, both new
24
and used, and including that manufactured on special order or
25
purchased for lease, certified by the purchaser to be used
26
primarily for graphic arts production. Equipment includes

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chemicals or chemicals acting as catalysts but only if the
2
chemicals or chemicals acting as catalysts effect a direct and
3
immediate change upon a graphic arts product. Beginning on
4
July 1, 2017, graphic arts machinery and equipment is included
5
in the manufacturing and assembling machinery and equipment
6
exemption under Section 2 of this Act.
7

(6) Personal property purchased from a teacher-sponsored
8
student organization affiliated with an elementary or
9
secondary school located in Illinois.
10

(7) Farm machinery and equipment, both new and used,
11
including that manufactured on special order, certified by the
12
purchaser to be used primarily for production agriculture or
13
State or federal agricultural programs, including individual
14
replacement parts for the machinery and equipment, including
15
machinery and equipment purchased for lease, and including
16
implements of husbandry defined in Section 1-130 of the
17
Illinois Vehicle Code, farm machinery and agricultural
18
chemical and fertilizer spreaders, and nurse wagons required
19
to be registered under Section 3-809 of the Illinois Vehicle
20
Code, but excluding other motor vehicles required to be
21
registered under the Illinois Vehicle Code. Horticultural
22
polyhouses or hoop houses used for propagating, growing, or
23
overwintering plants shall be considered farm machinery and
24
equipment under this item (7). Agricultural chemical tender
25
tanks and dry boxes shall include units sold separately from a
26
motor vehicle required to be licensed and units sold mounted

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on a motor vehicle required to be licensed if the selling price
2
of the tender is separately stated.
3

Farm machinery and equipment shall include precision
4
farming equipment that is installed or purchased to be
5
installed on farm machinery and equipment, including, but not
6
limited to, tractors, harvesters, sprayers, planters, seeders,
7
or spreaders. Precision farming equipment includes, but is not
8
limited to, soil testing sensors, computers, monitors,
9
software, global positioning and mapping systems, and other
10
such equipment.
11

Farm machinery and equipment also includes computers,
12
sensors, software, and related equipment used primarily in the
13
computer-assisted operation of production agriculture
14
facilities, equipment, and activities such as, but not limited
15
to, the collection, monitoring, and correlation of animal and
16
crop data for the purpose of formulating animal diets and
17
agricultural chemicals.
18

Beginning on January 1, 2024, farm machinery and equipment
19
also includes electrical power generation equipment used
20
primarily for production agriculture.
21

This item (7) is exempt from the provisions of Section
22
3-75.
23

(8) Until June 30, 2013, fuel and petroleum products sold
24
to or used by an air common carrier, certified by the carrier
25
to be used for consumption, shipment, or storage in the
26
conduct of its business as an air common carrier, for a flight

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destined for or returning from a location or locations outside
2
the United States without regard to previous or subsequent
3
domestic stopovers.
4

Beginning July 1, 2013, fuel and petroleum products sold
5
to or used by an air carrier, certified by the carrier to be
6
used for consumption, shipment, or storage in the conduct of
7
its business as an air common carrier, for a flight that (i) is
8
engaged in foreign trade or is engaged in trade between the
9
United States and any of its possessions and (ii) transports
10
at least one individual or package for hire from the city of
11
origination to the city of final destination on the same
12
aircraft, without regard to a change in the flight number of
13
that aircraft.
14

(9) Proceeds of mandatory service charges separately
15
stated on customers' bills for the purchase and consumption of
16
food and beverages acquired as an incident to the purchase of a
17
service from a serviceman, to the extent that the proceeds of
18
the service charge are in fact turned over as tips or as a
19
substitute for tips to the employees who participate directly
20
in preparing, serving, hosting or cleaning up the food or
21
beverage function with respect to which the service charge is
22
imposed.
23

(10) Until July 1, 2003, oil field exploration, drilling,
24
and production equipment, including (i) rigs and parts of
25
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
26
pipe and tubular goods, including casing and drill strings,

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(iii) pumps and pump-jack units, (iv) storage tanks and flow
2
lines, (v) any individual replacement part for oil field
3
exploration, drilling, and production equipment, and (vi)
4
machinery and equipment purchased for lease; but excluding
5
motor vehicles required to be registered under the Illinois
6
Vehicle Code.
7

(11) Proceeds from the sale of photoprocessing machinery
8
and equipment, including repair and replacement parts, both
9
new and used, including that manufactured on special order,
10
certified by the purchaser to be used primarily for
11
photoprocessing, and including photoprocessing machinery and
12
equipment purchased for lease.
13

(12) Until July 1, 2028, coal and aggregate exploration,
14
mining, off-highway hauling, processing, maintenance, and
15
reclamation equipment, including replacement parts and
16
equipment, and including equipment purchased for lease, but
17
excluding motor vehicles required to be registered under the
18
Illinois Vehicle Code. The changes made to this Section by
19
Public Act 97-767 apply on and after July 1, 2003, but no claim
20
for credit or refund is allowed on or after August 16, 2013
21
(the effective date of Public Act 98-456) for such taxes paid
22
during the period beginning July 1, 2003 and ending on August
23
16, 2013 (the effective date of Public Act 98-456).
24

(13) Semen used for artificial insemination of livestock
25
for direct agricultural production.
26

(14) Horses, or interests in horses, registered with and

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meeting the requirements of any of the Arabian Horse Club
2
Registry of America, Appaloosa Horse Club, American Quarter
3
Horse Association, United States Trotting Association, or
4
Jockey Club, as appropriate, used for purposes of breeding or
5
racing for prizes. This item (14) is exempt from the
6
provisions of Section 3-75, and the exemption provided for
7
under this item (14) applies for all periods beginning May 30,
8
1995, but no claim for credit or refund is allowed on or after
9
January 1, 2008 (the effective date of Public Act 95-88) for
10
such taxes paid during the period beginning May 30, 2000 and
11
ending on January 1, 2008 (the effective date of Public Act
12
95-88).
13

(15) Computers and communications equipment utilized for
14
any hospital purpose and equipment used in the diagnosis,
15
analysis, or treatment of hospital patients purchased by a
16
lessor who leases the equipment, under a lease of one year or
17
longer executed or in effect at the time the lessor would
18
otherwise be subject to the tax imposed by this Act, to a
19
hospital that has been issued an active tax exemption
20
identification number by the Department under Section 1g of
21
the Retailers' Occupation Tax Act. If the equipment is leased
22
in a manner that does not qualify for this exemption or is used
23
in any other non-exempt manner, the lessor shall be liable for
24
the tax imposed under this Act or the Use Tax Act, as the case
25
may be, based on the fair market value of the property at the
26
time the non-qualifying use occurs. No lessor shall collect or

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attempt to collect an amount (however designated) that
2
purports to reimburse that lessor for the tax imposed by this
3
Act or the Use Tax Act, as the case may be, if the tax has not
4
been paid by the lessor. If a lessor improperly collects any
5
such amount from the lessee, the lessee shall have a legal
6
right to claim a refund of that amount from the lessor. If,
7
however, that amount is not refunded to the lessee for any
8
reason, the lessor is liable to pay that amount to the
9
Department.
10

(16) Personal property purchased by a lessor who leases
11
the property, under a lease of one year or longer executed or
12
in effect at the time the lessor would otherwise be subject to
13
the tax imposed by this Act, to a governmental body that has
14
been issued an active tax exemption identification number by
15
the Department under Section 1g of the Retailers' Occupation
16
Tax Act. If the property is leased in a manner that does not
17
qualify for this exemption or is used in any other non-exempt
18
manner, the lessor shall be liable for the tax imposed under
19
this Act or the Use Tax Act, as the case may be, based on the
20
fair market value of the property at the time the
21
non-qualifying use occurs. No lessor shall collect or attempt
22
to collect an amount (however designated) that purports to
23
reimburse that lessor for the tax imposed by this Act or the
24
Use Tax Act, as the case may be, if the tax has not been paid
25
by the lessor. If a lessor improperly collects any such amount
26
from the lessee, the lessee shall have a legal right to claim a

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refund of that amount from the lessor. If, however, that
2
amount is not refunded to the lessee for any reason, the lessor
3
is liable to pay that amount to the Department.
4

(17) Beginning with taxable years ending on or after
5
December 31, 1995 and ending with taxable years ending on or
6
before December 31, 2004, personal property that is donated
7
for disaster relief to be used in a State or federally declared
8
disaster area in Illinois or bordering Illinois by a
9
manufacturer or retailer that is registered in this State to a
10
corporation, society, association, foundation, or institution
11
that has been issued a sales tax exemption identification
12
number by the Department that assists victims of the disaster
13
who reside within the declared disaster area.
14

(18) Beginning with taxable years ending on or after
15
December 31, 1995 and ending with taxable years ending on or
16
before December 31, 2004, personal property that is used in
17
the performance of infrastructure repairs in this State,
18
including, but not limited to, municipal roads and streets,
19
access roads, bridges, sidewalks, waste disposal systems,
20
water and sewer line extensions, water distribution and
21
purification facilities, storm water drainage and retention
22
facilities, and sewage treatment facilities, resulting from a
23
State or federally declared disaster in Illinois or bordering
24
Illinois when such repairs are initiated on facilities located
25
in the declared disaster area within 6 months after the
26
disaster.

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(19) Beginning July 1, 1999, game or game birds purchased
2
at a "game breeding and hunting preserve area" as that term is
3
used in the Wildlife Code. This paragraph is exempt from the
4
provisions of Section 3-75.
5

(20) A motor vehicle, as that term is defined in Section
6
1-146 of the Illinois Vehicle Code, that is donated to a
7
corporation, limited liability company, society, association,
8
foundation, or institution that is determined by the
9
Department to be organized and operated exclusively for
10
educational purposes. For purposes of this exemption, "a
11
corporation, limited liability company, society, association,
12
foundation, or institution organized and operated exclusively
13
for educational purposes" means all tax-supported public
14
schools, private schools that offer systematic instruction in
15
useful branches of learning by methods common to public
16
schools and that compare favorably in their scope and
17
intensity with the course of study presented in tax-supported
18
schools, and vocational or technical schools or institutes
19
organized and operated exclusively to provide a course of
20
study of not less than 6 weeks duration and designed to prepare
21
individuals to follow a trade or to pursue a manual,
22
technical, mechanical, industrial, business, or commercial
23
occupation.
24

(21) Beginning January 1, 2000, personal property,
25
including food, purchased through fundraising events for the
26
benefit of a public or private elementary or secondary school,

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a group of those schools, or one or more school districts if
2
the events are sponsored by an entity recognized by the school
3
district that consists primarily of volunteers and includes
4
parents and teachers of the school children. This paragraph
5
does not apply to fundraising events (i) for the benefit of
6
private home instruction or (ii) for which the fundraising
7
entity purchases the personal property sold at the events from
8
another individual or entity that sold the property for the
9
purpose of resale by the fundraising entity and that profits
10
from the sale to the fundraising entity. This paragraph is
11
exempt from the provisions of Section 3-75.
12

(22) Beginning January 1, 2000 and through December 31,
13
2001, new or used automatic vending machines that prepare and
14
serve hot food and beverages, including coffee, soup, and
15
other items, and replacement parts for these machines.
16
Beginning January 1, 2002 and through June 30, 2003, machines
17
and parts for machines used in commercial, coin-operated
18
amusement and vending business if a use or occupation tax is
19
paid on the gross receipts derived from the use of the
20
commercial, coin-operated amusement and vending machines. This
21
paragraph is exempt from the provisions of Section 3-75.
22

(23) Beginning August 23, 2001 and through June 30, 2016,
23
food for human consumption that is to be consumed off the
24
premises where it is sold (other than alcoholic beverages,
25
soft drinks, and food that has been prepared for immediate
26
consumption) and prescription and nonprescription medicines,

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drugs, medical appliances, and insulin, urine testing
2
materials, syringes, and needles used by diabetics, for human
3
use, when purchased for use by a person receiving medical
4
assistance under Article V of the Illinois Public Aid Code who
5
resides in a licensed long-term care facility, as defined in
6
the Nursing Home Care Act, or in a licensed facility as defined
7
in the ID/DD Community Care Act, the MC/DD Act, or the
8
Specialized Mental Health Rehabilitation Act of 2013.
9

(24) Beginning on August 2, 2001 (the effective date of
10
Public Act 92-227), computers and communications equipment
11
utilized for any hospital purpose and equipment used in the
12
diagnosis, analysis, or treatment of hospital patients
13
purchased by a lessor who leases the equipment, under a lease
14
of one year or longer executed or in effect at the time the
15
lessor would otherwise be subject to the tax imposed by this
16
Act, to a hospital that has been issued an active tax exemption
17
identification number by the Department under Section 1g of
18
the Retailers' Occupation Tax Act. If the equipment is leased
19
in a manner that does not qualify for this exemption or is used
20
in any other nonexempt manner, the lessor shall be liable for
21
the tax imposed under this Act or the Use Tax Act, as the case
22
may be, based on the fair market value of the property at the
23
time the nonqualifying use occurs. No lessor shall collect or
24
attempt to collect an amount (however designated) that
25
purports to reimburse that lessor for the tax imposed by this
26
Act or the Use Tax Act, as the case may be, if the tax has not

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been paid by the lessor. If a lessor improperly collects any
2
such amount from the lessee, the lessee shall have a legal
3
right to claim a refund of that amount from the lessor. If,
4
however, that amount is not refunded to the lessee for any
5
reason, the lessor is liable to pay that amount to the
6
Department. This paragraph is exempt from the provisions of
7
Section 3-75.
8

(25) Beginning on August 2, 2001 (the effective date of
9
Public Act 92-227), personal property purchased by a lessor
10
who leases the property, under a lease of one year or longer
11
executed or in effect at the time the lessor would otherwise be
12
subject to the tax imposed by this Act, to a governmental body
13
that has been issued an active tax exemption identification
14
number by the Department under Section 1g of the Retailers'
15
Occupation Tax Act. If the property is leased in a manner that
16
does not qualify for this exemption or is used in any other
17
nonexempt manner, the lessor shall be liable for the tax
18
imposed under this Act or the Use Tax Act, as the case may be,
19
based on the fair market value of the property at the time the
20
nonqualifying use occurs. No lessor shall collect or attempt
21
to collect an amount (however designated) that purports to
22
reimburse that lessor for the tax imposed by this Act or the
23
Use Tax Act, as the case may be, if the tax has not been paid
24
by the lessor. If a lessor improperly collects any such amount
25
from the lessee, the lessee shall have a legal right to claim a
26
refund of that amount from the lessor. If, however, that

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amount is not refunded to the lessee for any reason, the lessor
2
is liable to pay that amount to the Department. This paragraph
3
is exempt from the provisions of Section 3-75.
4

(26) Beginning January 1, 2008, tangible personal property
5
used in the construction or maintenance of a community water
6
supply, as defined under Section 3.145 of the Environmental
7
Protection Act, that is operated by a not-for-profit
8
corporation that holds a valid water supply permit issued
9
under Title IV of the Environmental Protection Act. This
10
paragraph is exempt from the provisions of Section 3-75.
11

(27) Beginning January 1, 2010 and continuing through
12
December 31, 2029, materials, parts, equipment, components,
13
and furnishings incorporated into or upon an aircraft as part
14
of the modification, refurbishment, completion, replacement,
15
repair, or maintenance of the aircraft. This exemption
16
includes consumable supplies used in the modification,
17
refurbishment, completion, replacement, repair, and
18
maintenance of aircraft. However, until January 1, 2024, this
19
exemption excludes any materials, parts, equipment,
20
components, and consumable supplies used in the modification,
21
replacement, repair, and maintenance of aircraft engines or
22
power plants, whether such engines or power plants are
23
installed or uninstalled upon any such aircraft. "Consumable
24
supplies" include, but are not limited to, adhesive, tape,
25
sandpaper, general purpose lubricants, cleaning solution,
26
latex gloves, and protective films.

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1

Beginning January 1, 2010 and continuing through December
2
31, 2023, this exemption applies only to the use of qualifying
3
tangible personal property transferred incident to the
4
modification, refurbishment, completion, replacement, repair,
5
or maintenance of aircraft by persons who (i) hold an Air
6
Agency Certificate and are empowered to operate an approved
7
repair station by the Federal Aviation Administration, (ii)
8
have a Class IV Rating, and (iii) conduct operations in
9
accordance with Part 145 of the Federal Aviation Regulations.
10
From January 1, 2024 through December 31, 2029, this exemption
11
applies only to the use of qualifying tangible personal
12
property transferred incident to: (A) the modification,
13
refurbishment, completion, repair, replacement, or maintenance
14
of an aircraft by persons who (i) hold an Air Agency
15
Certificate and are empowered to operate an approved repair
16
station by the Federal Aviation Administration, (ii) have a
17
Class IV Rating, and (iii) conduct operations in accordance
18
with Part 145 of the Federal Aviation Regulations; and (B) the
19
modification, replacement, repair, and maintenance of aircraft
20
engines or power plants without regard to whether or not those
21
persons meet the qualifications of item (A).
22

The exemption does not include aircraft operated by a
23
commercial air carrier providing scheduled passenger air
24
service pursuant to authority issued under Part 121 or Part
25
129 of the Federal Aviation Regulations. The changes made to
26
this paragraph (27) by Public Act 98-534 are declarative of

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existing law. It is the intent of the General Assembly that the
2
exemption under this paragraph (27) applies continuously from
3
January 1, 2010 through December 31, 2024; however, no claim
4
for credit or refund is allowed for taxes paid as a result of
5
the disallowance of this exemption on or after January 1, 2015
6
and prior to February 5, 2020 (the effective date of Public Act
7
101-629).
8

(28) Tangible personal property purchased by a
9
public-facilities corporation, as described in Section
10
11-65-10 of the Illinois Municipal Code, for purposes of
11
constructing or furnishing a municipal convention hall, but
12
only if the legal title to the municipal convention hall is
13
transferred to the municipality without any further
14
consideration by or on behalf of the municipality at the time
15
of the completion of the municipal convention hall or upon the
16
retirement or redemption of any bonds or other debt
17
instruments issued by the public-facilities corporation in
18
connection with the development of the municipal convention
19
hall. This exemption includes existing public-facilities
20
corporations as provided in Section 11-65-25 of the Illinois
21
Municipal Code. This paragraph is exempt from the provisions
22
of Section 3-75.
23

(29) Beginning January 1, 2017 and through December 31,
24
2026, menstrual pads, tampons, and menstrual cups.
25

(30) Tangible personal property transferred to a purchaser
26
who is exempt from the tax imposed by this Act by operation of

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federal law. This paragraph is exempt from the provisions of
2
Section 3-75.
3

(31) Qualified tangible personal property used in the
4
construction or operation of a data center that has been
5
granted a certificate of exemption by the Department of
6
Commerce and Economic Opportunity, whether that tangible
7
personal property is purchased by the owner, operator, or
8
tenant of the data center or by a contractor or subcontractor
9
of the owner, operator, or tenant. Data centers that would
10
have qualified for a certificate of exemption prior to January
11
1, 2020 had Public Act 101-31 been in effect, may apply for and
12
obtain an exemption for subsequent purchases of computer
13
equipment or enabling software purchased or leased to upgrade,
14
supplement, or replace computer equipment or enabling software
15
purchased or leased in the original investment that would have
16
qualified.
17

The Department of Commerce and Economic Opportunity shall
18
grant a certificate of exemption under this item (31) to
19
qualified data centers as defined by Section 605-1025 of the
20
Department of Commerce and Economic Opportunity Law of the
21
Civil Administrative Code of Illinois.
22

For the purposes of this item (31):
23

"Data center" means a building or a series of
24

buildings rehabilitated or constructed to house working
25

servers in one physical location or multiple sites within
26

the State of Illinois.

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"Qualified tangible personal property" means:
2

electrical systems and equipment; climate control and
3

chilling equipment and systems; mechanical systems and
4

equipment; monitoring and secure systems; emergency
5

generators; hardware; computers; servers; data storage
6

devices; network connectivity equipment; racks; cabinets;
7

telecommunications cabling infrastructure; raised floor
8

systems; peripheral components or systems; software;
9

mechanical, electrical, or plumbing systems; battery
10

systems; cooling systems and towers; temperature control
11

systems; other cabling; and other data center
12

infrastructure equipment and systems necessary to operate
13

qualified tangible personal property, including fixtures;
14

and component parts of any of the foregoing, including
15

installation, maintenance, repair, refurbishment, and
16

replacement of qualified tangible personal property to
17

generate, transform, transmit, distribute, or manage
18

electricity necessary to operate qualified tangible
19

personal property; and all other tangible personal
20

property that is essential to the operations of a computer
21

data center. The term "qualified tangible personal
22

property" also includes building materials physically
23

incorporated into the qualifying data center. To document
24

the exemption allowed under this Section, the retailer
25

must obtain from the purchaser a copy of the certificate
26

of eligibility issued by the Department of Commerce and

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Economic Opportunity.
2

This item (31) is exempt from the provisions of Section
3
3-75.
4

(32) Beginning July 1, 2022, breast pumps, breast pump
5
collection and storage supplies, and breast pump kits. This
6
item (32) is exempt from the provisions of Section 3-75. As
7
used in this item (32):
8

"Breast pump" means an electrically controlled or
9

manually controlled pump device designed or marketed to be
10

used to express milk from a human breast during lactation,
11

including the pump device and any battery, AC adapter, or
12

other power supply unit that is used to power the pump
13

device and is packaged and sold with the pump device at the
14

time of sale.
15

"Breast pump collection and storage supplies" means
16

items of tangible personal property designed or marketed
17

to be used in conjunction with a breast pump to collect
18

milk expressed from a human breast and to store collected
19

milk until it is ready for consumption.
20

"Breast pump collection and storage supplies"
21

includes, but is not limited to: breast shields and breast
22

shield connectors; breast pump tubes and tubing adapters;
23

breast pump valves and membranes; backflow protectors and
24

backflow protector adaptors; bottles and bottle caps
25

specific to the operation of the breast pump; and breast
26

milk storage bags.

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"Breast pump collection and storage supplies" does not
2

include: (1) bottles and bottle caps not specific to the
3

operation of the breast pump; (2) breast pump travel bags
4

and other similar carrying accessories, including ice
5

packs, labels, and other similar products; (3) breast pump
6

cleaning supplies; (4) nursing bras, bra pads, breast
7

shells, and other similar products; and (5) creams,
8

ointments, and other similar products that relieve
9

breastfeeding-related symptoms or conditions of the
10

breasts or nipples, unless sold as part of a breast pump
11

kit that is pre-packaged by the breast pump manufacturer
12

or distributor.
13

"Breast pump kit" means a kit that: (1) contains no
14

more than a breast pump, breast pump collection and
15

storage supplies, a rechargeable battery for operating the
16

breast pump, a breastmilk cooler, bottle stands, ice
17

packs, and a breast pump carrying case; and (2) is
18

pre-packaged as a breast pump kit by the breast pump
19

manufacturer or distributor.
20

(33) Tangible personal property sold by or on behalf of
21
the State Treasurer pursuant to the Revised Uniform Unclaimed
22
Property Act. This item (33) is exempt from the provisions of
23
Section 3-75.
24

(34) Beginning on January 1, 2024, tangible personal
25
property purchased by an active duty member of the armed
26
forces of the United States who presents valid military

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1
identification and purchases the property using a form of
2
payment where the federal government is the payor. The member
3
of the armed forces must complete, at the point of sale, a form
4
prescribed by the Department of Revenue documenting that the
5
transaction is eligible for the exemption under this
6
paragraph. Retailers must keep the form as documentation of
7
the exemption in their records for a period of not less than 6
8
years. "Armed forces of the United States" means the United
9
States Army, Navy, Air Force, Space Force, Marine Corps, or
10
Coast Guard. This paragraph is exempt from the provisions of
11
Section 3-75.
12

(35) Beginning July 1, 2024, home-delivered meals provided
13
to Medicare or Medicaid recipients when payment is made by an
14
intermediary, such as a Medicare Administrative Contractor, a
15
Managed Care Organization, or a Medicare Advantage
16
Organization, pursuant to a government contract. This
17
paragraph (35) is exempt from the provisions of Section 3-75.
18

(36) Beginning on January 1, 2026, as further defined in
19
Section 3-10, food prepared for immediate consumption and
20
transferred incident to a sale of service subject to this Act
21
or the Service Occupation Tax Act by an entity licensed under
22
the Hospital Licensing Act, the Nursing Home Care Act, the
23
Assisted Living and Shared Housing Act, the ID/DD Community
24
Care Act, the MC/DD Act, the Specialized Mental Health
25
Rehabilitation Act of 2013, or the Child Care Act of 1969 or by
26
an entity that holds a permit issued pursuant to the Life Care

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Facilities Act. This item (36) is exempt from the provisions
2
of Section 3-75.
3

(37) Beginning on January 1, 2026, as further defined in
4
Section 3-10, food for human consumption that is to be
5
consumed off the premises where it is sold (other than
6
alcoholic beverages, food consisting of or infused with adult
7
use cannabis, soft drinks, candy, and food that has been
8
prepared for immediate consumption). This item (37) is exempt
9
from the provisions of Section 3-75.
10

(38) Use by a lessee of the following leased tangible
11
personal property:
12

(1) software transferred subject to a license that
13

meets the following requirements:
14

(A) it is evidenced by a written agreement signed
15

by the licensor and the customer;
16

(i) an electronic agreement in which the
17

customer accepts the license by means of an
18

electronic signature that is verifiable and can be
19

authenticated and is attached to or made part of
20

the license will comply with this requirement;
21

(ii) a license agreement in which the customer
22

electronically accepts the terms by clicking "I
23

agree" does not comply with this requirement;
24

(B) it restricts the customer's duplication and
25

use of the software;
26

(C) it prohibits the customer from licensing,

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sublicensing, or transferring the software to a third
2

party (except to a related party) without the
3

permission and continued control of the licensor;
4

(D) the licensor has a policy of providing another
5

copy at minimal or no charge if the customer loses or
6

damages the software, or of permitting the licensee to
7

make and keep an archival copy, and such policy is
8

either stated in the license agreement, supported by
9

the licensor's books and records, or supported by a
10

notarized statement made under penalties of perjury by
11

the licensor; and
12

(E) the customer must destroy or return all copies
13

of the software to the licensor at the end of the
14

license period; this provision is deemed to be met, in
15

the case of a perpetual license, without being set
16

forth in the license agreement; and
17

(2) property that is subject to a tax on lease
18

receipts imposed by a home rule unit of local government
19

if the ordinance imposing that tax was adopted prior to
20

January 1, 2023.
21

(39) A motor vehicle of the first division, as defined in
22
Section 1-146 of the Illinois Vehicle Code, that is registered
23
in the State to an Illinois resident who acquired the vehicle
24
while the Illinois resident was stationed outside of this
25
State as an active duty member of the military. This item (39)
26
is exempt from the provisions of Section 3-75.

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As used in this item (39):

2

"Active duty member of the military" means a service
3
member who undertakes any full-time military training or
4
full-time military duty, no matter how described under federal
5
or State law, for which a service member is ordered to report
6
by the President, by the Governor of a state, commonwealth, or
7
territory of the United States, by an act of Congress, or by
8
any other appropriate military authority.

9

"Illinois resident" means an individual who meets the
10
definition of "resident" under subparagraph (A) of paragraph
11
(20) of subsection (a) of Section 1501 of the Illinois Income
12
Tax Act.

13

"Service member" means a person who is a member of any
14
component of the United States Armed Forces or the National
15
Guard of any state, the District of Columbia, a commonwealth,
16
or a territory of the United States.

17
(Source: P.A. 103-9, Article 5, Section 5-10, eff. 6-7-23;
18
103-9, Article 15, Section 15-10, eff. 6-7-23; 103-154, eff.
19
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
20
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
21
103-781, eff. 8-5-24; 103-995, eff. 8-9-24; 104-417, eff.
22
8-15-25.)

23

Section 15.
The Service Occupation Tax Act is amended by
24
changing Section 3-5 as follows:

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(35 ILCS 115/3-5)
2

Sec. 3-5.
Exemptions.
The following tangible personal
3
property is exempt from the tax imposed by this Act:
4

(1) Personal property sold by a corporation, society,
5
association, foundation, institution, or organization, other
6
than a limited liability company, that is organized and
7
operated as a not-for-profit service enterprise for the
8
benefit of persons 65 years of age or older if the personal
9
property was not purchased by the enterprise for the purpose
10
of resale by the enterprise.
11

(2) Personal property purchased by a not-for-profit
12
Illinois county fair association for use in conducting,
13
operating, or promoting the county fair.
14

(3) Personal property purchased by any not-for-profit arts
15
or cultural organization that establishes, by proof required
16
by the Department by rule, that it has received an exemption
17
under Section 501(c)(3) of the Internal Revenue Code and that
18
is organized and operated primarily for the presentation or
19
support of arts or cultural programming, activities, or
20
services. These organizations include, but are not limited to,
21
music and dramatic arts organizations such as symphony
22
orchestras and theatrical groups, arts and cultural service
23
organizations, local arts councils, visual arts organizations,
24
and media arts organizations. On and after July 1, 2001 (the
25
effective date of Public Act 92-35), however, an entity
26
otherwise eligible for this exemption shall not make tax-free

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purchases unless it has an active identification number issued
2
by the Department.
3

(4) Legal tender, currency, medallions, or gold or silver
4
coinage issued by the State of Illinois, the government of the
5
United States of America, or the government of any foreign
6
country, and bullion.
7

(5) Until July 1, 2003 and beginning again on September 1,
8
2004 through August 30, 2014, graphic arts machinery and
9
equipment, including repair and replacement parts, both new
10
and used, and including that manufactured on special order or
11
purchased for lease, certified by the purchaser to be used
12
primarily for graphic arts production. Equipment includes
13
chemicals or chemicals acting as catalysts but only if the
14
chemicals or chemicals acting as catalysts effect a direct and
15
immediate change upon a graphic arts product. Beginning on
16
July 1, 2017, graphic arts machinery and equipment is included
17
in the manufacturing and assembling machinery and equipment
18
exemption under Section 2 of this Act.
19

(6) Personal property sold by a teacher-sponsored student
20
organization affiliated with an elementary or secondary school
21
located in Illinois.
22

(7) Farm machinery and equipment, both new and used,
23
including that manufactured on special order, certified by the
24
purchaser to be used primarily for production agriculture or
25
State or federal agricultural programs, including individual
26
replacement parts for the machinery and equipment, including

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machinery and equipment purchased for lease, and including
2
implements of husbandry defined in Section 1-130 of the
3
Illinois Vehicle Code, farm machinery and agricultural
4
chemical and fertilizer spreaders, and nurse wagons required
5
to be registered under Section 3-809 of the Illinois Vehicle
6
Code, but excluding other motor vehicles required to be
7
registered under the Illinois Vehicle Code. Horticultural
8
polyhouses or hoop houses used for propagating, growing, or
9
overwintering plants shall be considered farm machinery and
10
equipment under this item (7). Agricultural chemical tender
11
tanks and dry boxes shall include units sold separately from a
12
motor vehicle required to be licensed and units sold mounted
13
on a motor vehicle required to be licensed if the selling price
14
of the tender is separately stated.
15

Farm machinery and equipment shall include precision
16
farming equipment that is installed or purchased to be
17
installed on farm machinery and equipment, including, but not
18
limited to, tractors, harvesters, sprayers, planters, seeders,
19
or spreaders. Precision farming equipment includes, but is not
20
limited to, soil testing sensors, computers, monitors,
21
software, global positioning and mapping systems, and other
22
such equipment.
23

Farm machinery and equipment also includes computers,
24
sensors, software, and related equipment used primarily in the
25
computer-assisted operation of production agriculture
26
facilities, equipment, and activities such as, but not limited

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to, the collection, monitoring, and correlation of animal and
2
crop data for the purpose of formulating animal diets and
3
agricultural chemicals.
4

Beginning on January 1, 2024, farm machinery and equipment
5
also includes electrical power generation equipment used
6
primarily for production agriculture.
7

This item (7) is exempt from the provisions of Section
8
3-55.
9

(8) Until June 30, 2013, fuel and petroleum products sold
10
to or used by an air common carrier, certified by the carrier
11
to be used for consumption, shipment, or storage in the
12
conduct of its business as an air common carrier, for a flight
13
destined for or returning from a location or locations outside
14
the United States without regard to previous or subsequent
15
domestic stopovers.
16

Beginning July 1, 2013, fuel and petroleum products sold
17
to or used by an air carrier, certified by the carrier to be
18
used for consumption, shipment, or storage in the conduct of
19
its business as an air common carrier, for a flight that (i) is
20
engaged in foreign trade or is engaged in trade between the
21
United States and any of its possessions and (ii) transports
22
at least one individual or package for hire from the city of
23
origination to the city of final destination on the same
24
aircraft, without regard to a change in the flight number of
25
that aircraft.
26

(9) Proceeds of mandatory service charges separately

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stated on customers' bills for the purchase and consumption of
2
food and beverages, to the extent that the proceeds of the
3
service charge are in fact turned over as tips or as a
4
substitute for tips to the employees who participate directly
5
in preparing, serving, hosting or cleaning up the food or
6
beverage function with respect to which the service charge is
7
imposed.
8

(10) Until July 1, 2003, oil field exploration, drilling,
9
and production equipment, including (i) rigs and parts of
10
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
11
pipe and tubular goods, including casing and drill strings,
12
(iii) pumps and pump-jack units, (iv) storage tanks and flow
13
lines, (v) any individual replacement part for oil field
14
exploration, drilling, and production equipment, and (vi)
15
machinery and equipment purchased for lease; but excluding
16
motor vehicles required to be registered under the Illinois
17
Vehicle Code.
18

(11) Photoprocessing machinery and equipment, including
19
repair and replacement parts, both new and used, including
20
that manufactured on special order, certified by the purchaser
21
to be used primarily for photoprocessing, and including
22
photoprocessing machinery and equipment purchased for lease.
23

(12) Until July 1, 2028, coal and aggregate exploration,
24
mining, off-highway hauling, processing, maintenance, and
25
reclamation equipment, including replacement parts and
26
equipment, and including equipment purchased for lease, but

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excluding motor vehicles required to be registered under the
2
Illinois Vehicle Code. The changes made to this Section by
3
Public Act 97-767 apply on and after July 1, 2003, but no claim
4
for credit or refund is allowed on or after August 16, 2013
5
(the effective date of Public Act 98-456) for such taxes paid
6
during the period beginning July 1, 2003 and ending on August
7
16, 2013 (the effective date of Public Act 98-456).
8

(13) Beginning January 1, 1992 and through June 30, 2016,
9
food for human consumption that is to be consumed off the
10
premises where it is sold (other than alcoholic beverages,
11
soft drinks and food that has been prepared for immediate
12
consumption) and prescription and non-prescription medicines,
13
drugs, medical appliances, and insulin, urine testing
14
materials, syringes, and needles used by diabetics, for human
15
use, when purchased for use by a person receiving medical
16
assistance under Article V of the Illinois Public Aid Code who
17
resides in a licensed long-term care facility, as defined in
18
the Nursing Home Care Act, or in a licensed facility as defined
19
in the ID/DD Community Care Act, the MC/DD Act, or the
20
Specialized Mental Health Rehabilitation Act of 2013.
21

(14) Semen used for artificial insemination of livestock
22
for direct agricultural production.
23

(15) Horses, or interests in horses, registered with and
24
meeting the requirements of any of the Arabian Horse Club
25
Registry of America, Appaloosa Horse Club, American Quarter
26
Horse Association, United States Trotting Association, or

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Jockey Club, as appropriate, used for purposes of breeding or
2
racing for prizes. This item (15) is exempt from the
3
provisions of Section 3-55, and the exemption provided for
4
under this item (15) applies for all periods beginning May 30,
5
1995, but no claim for credit or refund is allowed on or after
6
January 1, 2008 (the effective date of Public Act 95-88) for
7
such taxes paid during the period beginning May 30, 2000 and
8
ending on January 1, 2008 (the effective date of Public Act
9
95-88).
10

(16) Computers and communications equipment utilized for
11
any hospital purpose and equipment used in the diagnosis,
12
analysis, or treatment of hospital patients sold to a lessor
13
who leases the equipment, under a lease of one year or longer
14
executed or in effect at the time of the purchase, to a
15
hospital that has been issued an active tax exemption
16
identification number by the Department under Section 1g of
17
the Retailers' Occupation Tax Act.
18

(17) Personal property sold to a lessor who leases the
19
property, under a lease of one year or longer executed or in
20
effect at the time of the purchase, to a governmental body that
21
has been issued an active tax exemption identification number
22
by the Department under Section 1g of the Retailers'
23
Occupation Tax Act.
24

(18) Beginning with taxable years ending on or after
25
December 31, 1995 and ending with taxable years ending on or
26
before December 31, 2004, personal property that is donated

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for disaster relief to be used in a State or federally declared
2
disaster area in Illinois or bordering Illinois by a
3
manufacturer or retailer that is registered in this State to a
4
corporation, society, association, foundation, or institution
5
that has been issued a sales tax exemption identification
6
number by the Department that assists victims of the disaster
7
who reside within the declared disaster area.
8

(19) Beginning with taxable years ending on or after
9
December 31, 1995 and ending with taxable years ending on or
10
before December 31, 2004, personal property that is used in
11
the performance of infrastructure repairs in this State,
12
including, but not limited to, municipal roads and streets,
13
access roads, bridges, sidewalks, waste disposal systems,
14
water and sewer line extensions, water distribution and
15
purification facilities, storm water drainage and retention
16
facilities, and sewage treatment facilities, resulting from a
17
State or federally declared disaster in Illinois or bordering
18
Illinois when such repairs are initiated on facilities located
19
in the declared disaster area within 6 months after the
20
disaster.
21

(20) Beginning July 1, 1999, game or game birds sold at a
22
"game breeding and hunting preserve area" as that term is used
23
in the Wildlife Code. This paragraph is exempt from the
24
provisions of Section 3-55.
25

(21) A motor vehicle, as that term is defined in Section
26
1-146 of the Illinois Vehicle Code, that is donated to a

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corporation, limited liability company, society, association,
2
foundation, or institution that is determined by the
3
Department to be organized and operated exclusively for
4
educational purposes. For purposes of this exemption, "a
5
corporation, limited liability company, society, association,
6
foundation, or institution organized and operated exclusively
7
for educational purposes" means all tax-supported public
8
schools, private schools that offer systematic instruction in
9
useful branches of learning by methods common to public
10
schools and that compare favorably in their scope and
11
intensity with the course of study presented in tax-supported
12
schools, and vocational or technical schools or institutes
13
organized and operated exclusively to provide a course of
14
study of not less than 6 weeks duration and designed to prepare
15
individuals to follow a trade or to pursue a manual,
16
technical, mechanical, industrial, business, or commercial
17
occupation.
18

(22) Beginning January 1, 2000, personal property,
19
including food, purchased through fundraising events for the
20
benefit of a public or private elementary or secondary school,
21
a group of those schools, or one or more school districts if
22
the events are sponsored by an entity recognized by the school
23
district that consists primarily of volunteers and includes
24
parents and teachers of the school children. This paragraph
25
does not apply to fundraising events (i) for the benefit of
26
private home instruction or (ii) for which the fundraising

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entity purchases the personal property sold at the events from
2
another individual or entity that sold the property for the
3
purpose of resale by the fundraising entity and that profits
4
from the sale to the fundraising entity. This paragraph is
5
exempt from the provisions of Section 3-55.
6

(23) Beginning January 1, 2000 and through December 31,
7
2001, new or used automatic vending machines that prepare and
8
serve hot food and beverages, including coffee, soup, and
9
other items, and replacement parts for these machines.
10
Beginning January 1, 2002 and through June 30, 2003, machines
11
and parts for machines used in commercial, coin-operated
12
amusement and vending business if a use or occupation tax is
13
paid on the gross receipts derived from the use of the
14
commercial, coin-operated amusement and vending machines. This
15
paragraph is exempt from the provisions of Section 3-55.
16

(24) Beginning on August 2, 2001 (the effective date of
17
Public Act 92-227), computers and communications equipment
18
utilized for any hospital purpose and equipment used in the
19
diagnosis, analysis, or treatment of hospital patients sold to
20
a lessor who leases the equipment, under a lease of one year or
21
longer executed or in effect at the time of the purchase, to a
22
hospital that has been issued an active tax exemption
23
identification number by the Department under Section 1g of
24
the Retailers' Occupation Tax Act. This paragraph is exempt
25
from the provisions of Section 3-55.
26

(25) Beginning on August 2, 2001 (the effective date of

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Public Act 92-227), personal property sold to a lessor who
2
leases the property, under a lease of one year or longer
3
executed or in effect at the time of the purchase, to a
4
governmental body that has been issued an active tax exemption
5
identification number by the Department under Section 1g of
6
the Retailers' Occupation Tax Act. This paragraph is exempt
7
from the provisions of Section 3-55.
8

(26) Beginning on January 1, 2002 and through June 30,
9
2016, tangible personal property purchased from an Illinois
10
retailer by a taxpayer engaged in centralized purchasing
11
activities in Illinois who will, upon receipt of the property
12
in Illinois, temporarily store the property in Illinois (i)
13
for the purpose of subsequently transporting it outside this
14
State for use or consumption thereafter solely outside this
15
State or (ii) for the purpose of being processed, fabricated,
16
or manufactured into, attached to, or incorporated into other
17
tangible personal property to be transported outside this
18
State and thereafter used or consumed solely outside this
19
State. The Director of Revenue shall, pursuant to rules
20
adopted in accordance with the Illinois Administrative
21
Procedure Act, issue a permit to any taxpayer in good standing
22
with the Department who is eligible for the exemption under
23
this paragraph (26). The permit issued under this paragraph
24
(26) shall authorize the holder, to the extent and in the
25
manner specified in the rules adopted under this Act, to
26
purchase tangible personal property from a retailer exempt

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from the taxes imposed by this Act. Taxpayers shall maintain
2
all necessary books and records to substantiate the use and
3
consumption of all such tangible personal property outside of
4
the State of Illinois.
5

(27) Beginning January 1, 2008, tangible personal property
6
used in the construction or maintenance of a community water
7
supply, as defined under Section 3.145 of the Environmental
8
Protection Act, that is operated by a not-for-profit
9
corporation that holds a valid water supply permit issued
10
under Title IV of the Environmental Protection Act. This
11
paragraph is exempt from the provisions of Section 3-55.
12

(28) Tangible personal property sold to a
13
public-facilities corporation, as described in Section
14
11-65-10 of the Illinois Municipal Code, for purposes of
15
constructing or furnishing a municipal convention hall, but
16
only if the legal title to the municipal convention hall is
17
transferred to the municipality without any further
18
consideration by or on behalf of the municipality at the time
19
of the completion of the municipal convention hall or upon the
20
retirement or redemption of any bonds or other debt
21
instruments issued by the public-facilities corporation in
22
connection with the development of the municipal convention
23
hall. This exemption includes existing public-facilities
24
corporations as provided in Section 11-65-25 of the Illinois
25
Municipal Code. This paragraph is exempt from the provisions
26
of Section 3-55.

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(29) Beginning January 1, 2010 and continuing through
2
December 31, 2029, materials, parts, equipment, components,
3
and furnishings incorporated into or upon an aircraft as part
4
of the modification, refurbishment, completion, replacement,
5
repair, or maintenance of the aircraft. This exemption
6
includes consumable supplies used in the modification,
7
refurbishment, completion, replacement, repair, and
8
maintenance of aircraft. However, until January 1, 2024, this
9
exemption excludes any materials, parts, equipment,
10
components, and consumable supplies used in the modification,
11
replacement, repair, and maintenance of aircraft engines or
12
power plants, whether such engines or power plants are
13
installed or uninstalled upon any such aircraft. "Consumable
14
supplies" include, but are not limited to, adhesive, tape,
15
sandpaper, general purpose lubricants, cleaning solution,
16
latex gloves, and protective films.
17

Beginning January 1, 2010 and continuing through December
18
31, 2023, this exemption applies only to the transfer of
19
qualifying tangible personal property incident to the
20
modification, refurbishment, completion, replacement, repair,
21
or maintenance of an aircraft by persons who (i) hold an Air
22
Agency Certificate and are empowered to operate an approved
23
repair station by the Federal Aviation Administration, (ii)
24
have a Class IV Rating, and (iii) conduct operations in
25
accordance with Part 145 of the Federal Aviation Regulations.
26
The exemption does not include aircraft operated by a

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commercial air carrier providing scheduled passenger air
2
service pursuant to authority issued under Part 121 or Part
3
129 of the Federal Aviation Regulations. From January 1, 2024
4
through December 31, 2029, this exemption applies only to the
5
transfer of qualifying tangible personal property incident to:
6
(A) the modification, refurbishment, completion, repair,
7
replacement, or maintenance of an aircraft by persons who (i)
8
hold an Air Agency Certificate and are empowered to operate an
9
approved repair station by the Federal Aviation
10
Administration, (ii) have a Class IV Rating, and (iii) conduct
11
operations in accordance with Part 145 of the Federal Aviation
12
Regulations; and (B) the modification, replacement, repair,
13
and maintenance of aircraft engines or power plants without
14
regard to whether or not those persons meet the qualifications
15
of item (A).
16

The changes made to this paragraph (29) by Public Act
17
98-534 are declarative of existing law. It is the intent of the
18
General Assembly that the exemption under this paragraph (29)
19
applies continuously from January 1, 2010 through December 31,
20
2024; however, no claim for credit or refund is allowed for
21
taxes paid as a result of the disallowance of this exemption on
22
or after January 1, 2015 and prior to February 5, 2020 (the
23
effective date of Public Act 101-629).
24

(30) Beginning January 1, 2017 and through December 31,
25
2026, menstrual pads, tampons, and menstrual cups.
26

(31) Tangible personal property transferred to a purchaser

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who is exempt from tax by operation of federal law. This
2
paragraph is exempt from the provisions of Section 3-55.
3

(32) Qualified tangible personal property used in the
4
construction or operation of a data center that has been
5
granted a certificate of exemption by the Department of
6
Commerce and Economic Opportunity, whether that tangible
7
personal property is purchased by the owner, operator, or
8
tenant of the data center or by a contractor or subcontractor
9
of the owner, operator, or tenant. Data centers that would
10
have qualified for a certificate of exemption prior to January
11
1, 2020 had Public Act 101-31 been in effect, may apply for and
12
obtain an exemption for subsequent purchases of computer
13
equipment or enabling software purchased or leased to upgrade,
14
supplement, or replace computer equipment or enabling software
15
purchased or leased in the original investment that would have
16
qualified.
17

The Department of Commerce and Economic Opportunity shall
18
grant a certificate of exemption under this item (32) to
19
qualified data centers as defined by Section 605-1025 of the
20
Department of Commerce and Economic Opportunity Law of the
21
Civil Administrative Code of Illinois.
22

For the purposes of this item (32):
23

"Data center" means a building or a series of
24

buildings rehabilitated or constructed to house working
25

servers in one physical location or multiple sites within
26

the State of Illinois.

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"Qualified tangible personal property" means:
2

electrical systems and equipment; climate control and
3

chilling equipment and systems; mechanical systems and
4

equipment; monitoring and secure systems; emergency
5

generators; hardware; computers; servers; data storage
6

devices; network connectivity equipment; racks; cabinets;
7

telecommunications cabling infrastructure; raised floor
8

systems; peripheral components or systems; software;
9

mechanical, electrical, or plumbing systems; battery
10

systems; cooling systems and towers; temperature control
11

systems; other cabling; and other data center
12

infrastructure equipment and systems necessary to operate
13

qualified tangible personal property, including fixtures;
14

and component parts of any of the foregoing, including
15

installation, maintenance, repair, refurbishment, and
16

replacement of qualified tangible personal property to
17

generate, transform, transmit, distribute, or manage
18

electricity necessary to operate qualified tangible
19

personal property; and all other tangible personal
20

property that is essential to the operations of a computer
21

data center. The term "qualified tangible personal
22

property" also includes building materials physically
23

incorporated into the qualifying data center. To document
24

the exemption allowed under this Section, the retailer
25

must obtain from the purchaser a copy of the certificate
26

of eligibility issued by the Department of Commerce and

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Economic Opportunity.
2

This item (32) is exempt from the provisions of Section
3
3-55.
4

(33) Beginning July 1, 2022, breast pumps, breast pump
5
collection and storage supplies, and breast pump kits. This
6
item (33) is exempt from the provisions of Section 3-55. As
7
used in this item (33):
8

"Breast pump" means an electrically controlled or
9

manually controlled pump device designed or marketed to be
10

used to express milk from a human breast during lactation,
11

including the pump device and any battery, AC adapter, or
12

other power supply unit that is used to power the pump
13

device and is packaged and sold with the pump device at the
14

time of sale.
15

"Breast pump collection and storage supplies" means
16

items of tangible personal property designed or marketed
17

to be used in conjunction with a breast pump to collect
18

milk expressed from a human breast and to store collected
19

milk until it is ready for consumption.
20

"Breast pump collection and storage supplies"
21

includes, but is not limited to: breast shields and breast
22

shield connectors; breast pump tubes and tubing adapters;
23

breast pump valves and membranes; backflow protectors and
24

backflow protector adaptors; bottles and bottle caps
25

specific to the operation of the breast pump; and breast
26

milk storage bags.

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"Breast pump collection and storage supplies" does not
2

include: (1) bottles and bottle caps not specific to the
3

operation of the breast pump; (2) breast pump travel bags
4

and other similar carrying accessories, including ice
5

packs, labels, and other similar products; (3) breast pump
6

cleaning supplies; (4) nursing bras, bra pads, breast
7

shells, and other similar products; and (5) creams,
8

ointments, and other similar products that relieve
9

breastfeeding-related symptoms or conditions of the
10

breasts or nipples, unless sold as part of a breast pump
11

kit that is pre-packaged by the breast pump manufacturer
12

or distributor.
13

"Breast pump kit" means a kit that: (1) contains no
14

more than a breast pump, breast pump collection and
15

storage supplies, a rechargeable battery for operating the
16

breast pump, a breastmilk cooler, bottle stands, ice
17

packs, and a breast pump carrying case; and (2) is
18

pre-packaged as a breast pump kit by the breast pump
19

manufacturer or distributor.
20

(34) Tangible personal property sold by or on behalf of
21
the State Treasurer pursuant to the Revised Uniform Unclaimed
22
Property Act. This item (34) is exempt from the provisions of
23
Section 3-55.
24

(35) Beginning on January 1, 2024, tangible personal
25
property purchased by an active duty member of the armed
26
forces of the United States who presents valid military

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identification and purchases the property using a form of
2
payment where the federal government is the payor. The member
3
of the armed forces must complete, at the point of sale, a form
4
prescribed by the Department of Revenue documenting that the
5
transaction is eligible for the exemption under this
6
paragraph. Retailers must keep the form as documentation of
7
the exemption in their records for a period of not less than 6
8
years. "Armed forces of the United States" means the United
9
States Army, Navy, Air Force, Space Force, Marine Corps, or
10
Coast Guard. This paragraph is exempt from the provisions of
11
Section 3-55.
12

(36) Beginning July 1, 2024, home-delivered meals provided
13
to Medicare or Medicaid recipients when payment is made by an
14
intermediary, such as a Medicare Administrative Contractor, a
15
Managed Care Organization, or a Medicare Advantage
16
Organization, pursuant to a government contract. This
17
paragraph (36) is exempt from the provisions of Section 3-55.
18

(37) Beginning on January 1, 2026, as further defined in
19
Section 3-10, food prepared for immediate consumption and
20
transferred incident to a sale of service subject to this Act
21
or the Service Use Tax Act by an entity licensed under the
22
Hospital Licensing Act, the Nursing Home Care Act, the
23
Assisted Living and Shared Housing Act, the ID/DD Community
24
Care Act, the MC/DD Act, the Specialized Mental Health
25
Rehabilitation Act of 2013, or the Child Care Act of 1969 or by
26
an entity that holds a permit issued pursuant to the Life Care

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Facilities Act. This item (37) is exempt from the provisions
2
of Section 3-55.
3

(38) Beginning on January 1, 2026, as further defined in
4
Section 3-10, food for human consumption that is to be
5
consumed off the premises where it is sold (other than
6
alcoholic beverages, food consisting of or infused with adult
7
use cannabis, soft drinks, candy, and food that has been
8
prepared for immediate consumption). This item (38) is exempt
9
from the provisions of Section 3-55.
10

(39) The lease of the following tangible personal
11
property:
12

(1) computer software transferred subject to a license
13

that meets the following requirements:
14

(A) it is evidenced by a written agreement signed
15

by the licensor and the customer;
16

(i) an electronic agreement in which the
17

customer accepts the license by means of an
18

electronic signature that is verifiable and can be
19

authenticated and is attached to or made part of
20

the license will comply with this requirement;
21

(ii) a license agreement in which the customer
22

electronically accepts the terms by clicking "I
23

agree" does not comply with this requirement;
24

(B) it restricts the customer's duplication and
25

use of the software;
26

(C) it prohibits the customer from licensing,

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sublicensing, or transferring the software to a third
2

party (except to a related party) without the
3

permission and continued control of the licensor;
4

(D) the licensor has a policy of providing another
5

copy at minimal or no charge if the customer loses or
6

damages the software, or of permitting the licensee to
7

make and keep an archival copy, and such policy is
8

either stated in the license agreement, supported by
9

the licensor's books and records, or supported by a
10

notarized statement made under penalties of perjury by
11

the licensor; and
12

(E) the customer must destroy or return all copies
13

of the software to the licensor at the end of the
14

license period; this provision is deemed to be met, in
15

the case of a perpetual license, without being set
16

forth in the license agreement; and
17

(2) property that is subject to a tax on lease
18

receipts imposed by a home rule unit of local government
19

if the ordinance imposing that tax was adopted prior to
20

January 1, 2023.
21

(40) A motor vehicle of the first division, as defined in
22
Section 1-146 of the Illinois Vehicle Code, that is registered
23
in the State to an Illinois resident who acquired the vehicle
24
while the Illinois resident was stationed outside of this
25
State as an active duty member of the military. This item (40)
26
is exempt from the provisions of Section 3-55.

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As used in this item (40):

2

"Active duty member of the military" means a service
3
member who undertakes any full-time military training or
4
full-time military duty, no matter how described under federal
5
or State law, for which a service member is ordered to report
6
by the President, by the Governor of a state, commonwealth, or
7
territory of the United States, by an act of Congress, or by
8
any other appropriate military authority.

9

"Illinois resident" means an individual who meets the
10
definition of "resident" under subparagraph (A) of paragraph
11
(20) of subsection (a) of Section 1501 of the Illinois Income
12
Tax Act.

13

"Service member" means a person who is a member of any
14
component of the United States Armed Forces or the National
15
Guard of any state, the District of Columbia, a commonwealth,
16
or a territory of the United States.

17
(Source: P.A. 103-9, Article 5, Section 5-15, eff. 6-7-23;
18
103-9, Article 15, Section 15-15, eff. 6-7-23; 103-154, eff.
19
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
20
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
21
103-781, eff. 8-5-24; 103-995, eff. 8-9-24; 104-417, eff.
22
8-15-25.)

23

Section 20.
The Retailers' Occupation Tax Act is amended
24
by changing Section 2-5 as follows:

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(35 ILCS 120/2-5)
2

Sec. 2-5.
Exemptions.
Gross receipts from proceeds from
3
the sale, which, on and after January 1, 2025, includes the
4
lease, of the following tangible personal property are exempt
5
from the tax imposed by this Act:
6

(1) Farm chemicals.
7

(2) Farm machinery and equipment, both new and used,
8

including that manufactured on special order, certified by
9

the purchaser to be used primarily for production
10

agriculture or State or federal agricultural programs,
11

including individual replacement parts for the machinery
12

and equipment, including machinery and equipment purchased
13

for lease, and including implements of husbandry defined
14

in Section 1-130 of the Illinois Vehicle Code, farm
15

machinery and agricultural chemical and fertilizer
16

spreaders, and nurse wagons required to be registered
17

under Section 3-809 of the Illinois Vehicle Code, but
18

excluding other motor vehicles required to be registered
19

under the Illinois Vehicle Code. Horticultural polyhouses
20

or hoop houses used for propagating, growing, or
21

overwintering plants shall be considered farm machinery
22

and equipment under this item (2). Agricultural chemical
23

tender tanks and dry boxes shall include units sold
24

separately from a motor vehicle required to be licensed
25

and units sold mounted on a motor vehicle required to be
26

licensed, if the selling price of the tender is separately

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stated.
2

Farm machinery and equipment shall include precision
3

farming equipment that is installed or purchased to be
4

installed on farm machinery and equipment including, but
5

not limited to, tractors, harvesters, sprayers, planters,
6

seeders, or spreaders. Precision farming equipment
7

includes, but is not limited to, soil testing sensors,
8

computers, monitors, software, global positioning and
9

mapping systems, and other such equipment.
10

Farm machinery and equipment also includes computers,
11

sensors, software, and related equipment used primarily in
12

the computer-assisted operation of production agriculture
13

facilities, equipment, and activities such as, but not
14

limited to, the collection, monitoring, and correlation of
15

animal and crop data for the purpose of formulating animal
16

diets and agricultural chemicals.
17

Beginning on January 1, 2024, farm machinery and
18

equipment also includes electrical power generation
19

equipment used primarily for production agriculture.
20

This item (2) is exempt from the provisions of Section
21

2-70.
22

(3) Until July 1, 2003, distillation machinery and
23

equipment, sold as a unit or kit, assembled or installed
24

by the retailer, certified by the user to be used only for
25

the production of ethyl alcohol that will be used for
26

consumption as motor fuel or as a component of motor fuel

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for the personal use of the user, and not subject to sale
2

or resale.
3

(4) Until July 1, 2003 and beginning again September
4

1, 2004 through August 30, 2014, graphic arts machinery
5

and equipment, including repair and replacement parts,
6

both new and used, and including that manufactured on
7

special order or purchased for lease, certified by the
8

purchaser to be used primarily for graphic arts
9

production. Equipment includes chemicals or chemicals
10

acting as catalysts but only if the chemicals or chemicals
11

acting as catalysts effect a direct and immediate change
12

upon a graphic arts product. Beginning on July 1, 2017,
13

graphic arts machinery and equipment is included in the
14

manufacturing and assembling machinery and equipment
15

exemption under paragraph (14).
16

(5) A motor vehicle that is used for automobile
17

renting, as defined in the Automobile Renting Occupation
18

and Use Tax Act. This paragraph is exempt from the
19

provisions of Section 2-70.
20

(6) Personal property sold by a teacher-sponsored
21

student organization affiliated with an elementary or
22

secondary school located in Illinois.
23

(7) Until July 1, 2003, proceeds of that portion of
24

the selling price of a passenger car the sale of which is
25

subject to the Replacement Vehicle Tax.
26

(8) Personal property sold to an Illinois county fair

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association for use in conducting, operating, or promoting
2

the county fair.
3

(9) Personal property sold to a not-for-profit arts or
4

cultural organization that establishes, by proof required
5

by the Department by rule, that it has received an
6

exemption under Section 501(c)(3) of the Internal Revenue
7

Code and that is organized and operated primarily for the
8

presentation or support of arts or cultural programming,
9

activities, or services. These organizations include, but
10

are not limited to, music and dramatic arts organizations
11

such as symphony orchestras and theatrical groups, arts
12

and cultural service organizations, local arts councils,
13

visual arts organizations, and media arts organizations.
14

On and after July 1, 2001 (the effective date of Public Act
15

92-35), however, an entity otherwise eligible for this
16

exemption shall not make tax-free purchases unless it has
17

an active identification number issued by the Department.
18

(10) Personal property sold by a corporation, society,
19

association, foundation, institution, or organization,
20

other than a limited liability company, that is organized
21

and operated as a not-for-profit service enterprise for
22

the benefit of persons 65 years of age or older if the
23

personal property was not purchased by the enterprise for
24

the purpose of resale by the enterprise.
25

(11) Except as otherwise provided in this Section,
26

personal property sold to a governmental body, to a

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corporation, society, association, foundation, or
2

institution organized and operated exclusively for
3

charitable, religious, or educational purposes, or to a
4

not-for-profit corporation, society, association,
5

foundation, institution, or organization that has no
6

compensated officers or employees and that is organized
7

and operated primarily for the recreation of persons 55
8

years of age or older. A limited liability company may
9

qualify for the exemption under this paragraph only if the
10

limited liability company is organized and operated
11

exclusively for educational purposes. On and after July 1,
12

1987, however, no entity otherwise eligible for this
13

exemption shall make tax-free purchases unless it has an
14

active identification number issued by the Department.
15

(12) (Blank).
16

(12-5) On and after July 1, 2003 and through June 30,
17

2004, motor vehicles of the second division with a gross
18

vehicle weight in excess of 8,000 pounds that are subject
19

to the commercial distribution fee imposed under Section
20

3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
21

2004 and through June 30, 2005, the use in this State of
22

motor vehicles of the second division: (i) with a gross
23

vehicle weight rating in excess of 8,000 pounds; (ii) that
24

are subject to the commercial distribution fee imposed
25

under Section 3-815.1 of the Illinois Vehicle Code; and
26

(iii) that are primarily used for commercial purposes.

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Through June 30, 2005, this exemption applies to repair
2

and replacement parts added after the initial purchase of
3

such a motor vehicle if that motor vehicle is used in a
4

manner that would qualify for the rolling stock exemption
5

otherwise provided for in this Act. For purposes of this
6

paragraph, "used for commercial purposes" means the
7

transportation of persons or property in furtherance of
8

any commercial or industrial enterprise whether for-hire
9

or not.
10

(13) Proceeds from sales to owners or lessors,
11

lessees, or shippers of tangible personal property that is
12

utilized by interstate carriers for hire for use as
13

rolling stock moving in interstate commerce and equipment
14

operated by a telecommunications provider, licensed as a
15

common carrier by the Federal Communications Commission,
16

which is permanently installed in or affixed to aircraft
17

moving in interstate commerce.
18

(14) Machinery and equipment that will be used by the
19

purchaser, or a lessee of the purchaser, primarily in the
20

process of manufacturing or assembling tangible personal
21

property for wholesale or retail sale or lease, whether
22

the sale or lease is made directly by the manufacturer or
23

by some other person, whether the materials used in the
24

process are owned by the manufacturer or some other
25

person, or whether the sale or lease is made apart from or
26

as an incident to the seller's engaging in the service

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occupation of producing machines, tools, dies, jigs,
2

patterns, gauges, or other similar items of no commercial
3

value on special order for a particular purchaser. The
4

exemption provided by this paragraph (14) does not include
5

machinery and equipment used in (i) the generation of
6

electricity for wholesale or retail sale; (ii) the
7

generation or treatment of natural or artificial gas for
8

wholesale or retail sale that is delivered to customers
9

through pipes, pipelines, or mains; or (iii) the treatment
10

of water for wholesale or retail sale that is delivered to
11

customers through pipes, pipelines, or mains. The
12

provisions of Public Act 98-583 are declaratory of
13

existing law as to the meaning and scope of this
14

exemption. Beginning on July 1, 2017, the exemption
15

provided by this paragraph (14) includes, but is not
16

limited to, graphic arts machinery and equipment, as
17

defined in paragraph (4) of this Section.
18

(15) Proceeds of mandatory service charges separately
19

stated on customers' bills for purchase and consumption of
20

food and beverages, to the extent that the proceeds of the
21

service charge are in fact turned over as tips or as a
22

substitute for tips to the employees who participate
23

directly in preparing, serving, hosting or cleaning up the
24

food or beverage function with respect to which the
25

service charge is imposed.
26

(16) Tangible personal property sold to a purchaser if

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the purchaser is exempt from use tax by operation of
2

federal law. This paragraph is exempt from the provisions
3

of Section 2-70.
4

(17) Tangible personal property sold to a common
5

carrier by rail or motor that receives the physical
6

possession of the property in Illinois and that transports
7

the property, or shares with another common carrier in the
8

transportation of the property, out of Illinois on a
9

standard uniform bill of lading showing the seller of the
10

property as the shipper or consignor of the property to a
11

destination outside Illinois, for use outside Illinois.
12

(18) Legal tender, currency, medallions, or gold or
13

silver coinage issued by the State of Illinois, the
14

government of the United States of America, or the
15

government of any foreign country, and bullion.
16

(19) Until July 1, 2003, oil field exploration,
17

drilling, and production equipment, including (i) rigs and
18

parts of rigs, rotary rigs, cable tool rigs, and workover
19

rigs, (ii) pipe and tubular goods, including casing and
20

drill strings, (iii) pumps and pump-jack units, (iv)
21

storage tanks and flow lines, (v) any individual
22

replacement part for oil field exploration, drilling, and
23

production equipment, and (vi) machinery and equipment
24

purchased for lease; but excluding motor vehicles required
25

to be registered under the Illinois Vehicle Code.
26

(20) Photoprocessing machinery and equipment,

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including repair and replacement parts, both new and used,
2

including that manufactured on special order, certified by
3

the purchaser to be used primarily for photoprocessing,
4

and including photoprocessing machinery and equipment
5

purchased for lease.
6

(21) Until July 1, 2028, coal and aggregate
7

exploration, mining, off-highway hauling, processing,
8

maintenance, and reclamation equipment, including
9

replacement parts and equipment, and including equipment
10

purchased for lease, but excluding motor vehicles required
11

to be registered under the Illinois Vehicle Code. The
12

changes made to this Section by Public Act 97-767 apply on
13

and after July 1, 2003, but no claim for credit or refund
14

is allowed on or after August 16, 2013 (the effective date
15

of Public Act 98-456) for such taxes paid during the
16

period beginning July 1, 2003 and ending on August 16,
17

2013 (the effective date of Public Act 98-456).
18

(22) Until June 30, 2013, fuel and petroleum products
19

sold to or used by an air carrier, certified by the carrier
20

to be used for consumption, shipment, or storage in the
21

conduct of its business as an air common carrier, for a
22

flight destined for or returning from a location or
23

locations outside the United States without regard to
24

previous or subsequent domestic stopovers.
25

Beginning July 1, 2013, fuel and petroleum products
26

sold to or used by an air carrier, certified by the carrier

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to be used for consumption, shipment, or storage in the
2

conduct of its business as an air common carrier, for a
3

flight that (i) is engaged in foreign trade or is engaged
4

in trade between the United States and any of its
5

possessions and (ii) transports at least one individual or
6

package for hire from the city of origination to the city
7

of final destination on the same aircraft, without regard
8

to a change in the flight number of that aircraft.
9

(23) A transaction in which the purchase order is
10

received by a florist who is located outside Illinois, but
11

who has a florist located in Illinois deliver the property
12

to the purchaser or the purchaser's donee in Illinois.
13

(24) Fuel consumed or used in the operation of ships,
14

barges, or vessels that are used primarily in or for the
15

transportation of property or the conveyance of persons
16

for hire on rivers bordering on this State if the fuel is
17

delivered by the seller to the purchaser's barge, ship, or
18

vessel while it is afloat upon that bordering river.
19

(25) Except as provided in items (25-5) and (25-6) of
20

this Section, a motor vehicle sold in this State to a
21

nonresident even though the motor vehicle is delivered to
22

the nonresident in this State, if the motor vehicle is not
23

to be titled in this State, and if a drive-away permit is
24

issued to the motor vehicle as provided in Section 3-603
25

of the Illinois Vehicle Code or if the nonresident
26

purchaser has vehicle registration plates to transfer to

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the motor vehicle upon returning to his or her home state.
2

The issuance of the drive-away permit or having the
3

out-of-state registration plates to be transferred is
4

prima facie evidence that the motor vehicle will not be
5

titled in this State.
6

(25-5) The exemption under item (25) does not apply if
7

the state in which the motor vehicle will be titled does
8

not allow a reciprocal exemption for a motor vehicle sold
9

and delivered in that state to an Illinois resident but
10

titled in Illinois. The tax collected under this Act on
11

the sale of a motor vehicle in this State to a resident of
12

another state that does not allow a reciprocal exemption
13

shall be imposed at a rate equal to the state's rate of tax
14

on taxable property in the state in which the purchaser is
15

a resident, except that the tax shall not exceed the tax
16

that would otherwise be imposed under this Act. At the
17

time of the sale, the purchaser shall execute a statement,
18

signed under penalty of perjury, of his or her intent to
19

title the vehicle in the state in which the purchaser is a
20

resident within 30 days after the sale and of the fact of
21

the payment to the State of Illinois of tax in an amount
22

equivalent to the state's rate of tax on taxable property
23

in his or her state of residence and shall submit the
24

statement to the appropriate tax collection agency in his
25

or her state of residence. In addition, the retailer must
26

retain a signed copy of the statement in his or her

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records. Nothing in this item shall be construed to
2

require the removal of the vehicle from this state
3

following the filing of an intent to title the vehicle in
4

the purchaser's state of residence if the purchaser titles
5

the vehicle in his or her state of residence within 30 days
6

after the date of sale. The tax collected under this Act in
7

accordance with this item (25-5) shall be proportionately
8

distributed as if the tax were collected at the 6.25%
9

general rate imposed under this Act.
10

(25-6) There is a rebuttable presumption that the
11

exemption under item (25) does not apply if the purchaser
12

is a limited liability company and a member of the limited
13

liability company is a resident of Illinois. This
14

presumption may be rebutted by other evidence, such as
15

evidence the motor vehicle is insured at a garaging or
16

storage address outside Illinois or other evidence of the
17

physical address at which the motor vehicle will be
18

permanently stored or garaged outside Illinois.
19

(25-7) Beginning on July 1, 2007, no tax is imposed
20

under this Act on the sale of an aircraft, as defined in
21

Section 3 of the Illinois Aeronautics Act, if all of the
22

following conditions are met:
23

(1) the aircraft leaves this State within 15 days
24

after the later of either the issuance of the final
25

billing for the sale of the aircraft, or the
26

authorized approval for return to service, completion

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of the maintenance record entry, and completion of the
2

test flight and ground test for inspection, as
3

required by 14 CFR 91.407;
4

(2) the aircraft is not based or registered in
5

this State after the sale of the aircraft; and
6

(3) the seller retains in his or her books and
7

records and provides to the Department a signed and
8

dated certification from the purchaser, on a form
9

prescribed by the Department, certifying that the
10

requirements of this item (25-7) are met. The
11

certificate must also include the name and address of
12

the purchaser, the address of the location where the
13

aircraft is to be titled or registered, the address of
14

the primary physical location of the aircraft, and
15

other information that the Department may reasonably
16

require.
17

For purposes of this item (25-7):
18

"Based in this State" means hangared, stored, or
19

otherwise used, excluding post-sale customizations as
20

defined in this Section, for 10 or more days in each
21

12-month period immediately following the date of the sale
22

of the aircraft.
23

"Registered in this State" means an aircraft
24

registered with the Department of Transportation,
25

Aeronautics Division, or titled or registered with the
26

Federal Aviation Administration to an address located in

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this State.
2

This paragraph (25-7) is exempt from the provisions of
3

Section 2-70.
4

(26) Semen used for artificial insemination of
5

livestock for direct agricultural production.
6

(27) Horses, or interests in horses, registered with
7

and meeting the requirements of any of the Arabian Horse
8

Club Registry of America, Appaloosa Horse Club, American
9

Quarter Horse Association, United States Trotting
10

Association, or Jockey Club, as appropriate, used for
11

purposes of breeding or racing for prizes. This item (27)
12

is exempt from the provisions of Section 2-70, and the
13

exemption provided for under this item (27) applies for
14

all periods beginning May 30, 1995, but no claim for
15

credit or refund is allowed on or after January 1, 2008
16

(the effective date of Public Act 95-88) for such taxes
17

paid during the period beginning May 30, 2000 and ending
18

on January 1, 2008 (the effective date of Public Act
19

95-88).
20

(28) Computers and communications equipment utilized
21

for any hospital purpose and equipment used in the
22

diagnosis, analysis, or treatment of hospital patients
23

sold to a lessor who leases the equipment, under a lease of
24

one year or longer executed or in effect at the time of the
25

purchase, to a hospital that has been issued an active tax
26

exemption identification number by the Department under

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Section 1g of this Act.
2

(29) Personal property sold to a lessor who leases the
3

property, under a lease of one year or longer executed or
4

in effect at the time of the purchase, to a governmental
5

body that has been issued an active tax exemption
6

identification number by the Department under Section 1g
7

of this Act.
8

(30) Beginning with taxable years ending on or after
9

December 31, 1995 and ending with taxable years ending on
10

or before December 31, 2004, personal property that is
11

donated for disaster relief to be used in a State or
12

federally declared disaster area in Illinois or bordering
13

Illinois by a manufacturer or retailer that is registered
14

in this State to a corporation, society, association,
15

foundation, or institution that has been issued a sales
16

tax exemption identification number by the Department that
17

assists victims of the disaster who reside within the
18

declared disaster area.
19

(31) Beginning with taxable years ending on or after
20

December 31, 1995 and ending with taxable years ending on
21

or before December 31, 2004, personal property that is
22

used in the performance of infrastructure repairs in this
23

State, including, but not limited to, municipal roads and
24

streets, access roads, bridges, sidewalks, waste disposal
25

systems, water and sewer line extensions, water
26

distribution and purification facilities, storm water

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drainage and retention facilities, and sewage treatment
2

facilities, resulting from a State or federally declared
3

disaster in Illinois or bordering Illinois when such
4

repairs are initiated on facilities located in the
5

declared disaster area within 6 months after the disaster.
6

(32) Beginning July 1, 1999, game or game birds sold
7

at a "game breeding and hunting preserve area" as that
8

term is used in the Wildlife Code. This paragraph is
9

exempt from the provisions of Section 2-70.
10

(33) A motor vehicle, as that term is defined in
11

Section 1-146 of the Illinois Vehicle Code, that is
12

donated to a corporation, limited liability company,
13

society, association, foundation, or institution that is
14

determined by the Department to be organized and operated
15

exclusively for educational purposes. For purposes of this
16

exemption, "a corporation, limited liability company,
17

society, association, foundation, or institution organized
18

and operated exclusively for educational purposes" means
19

all tax-supported public schools, private schools that
20

offer systematic instruction in useful branches of
21

learning by methods common to public schools and that
22

compare favorably in their scope and intensity with the
23

course of study presented in tax-supported schools, and
24

vocational or technical schools or institutes organized
25

and operated exclusively to provide a course of study of
26

not less than 6 weeks duration and designed to prepare

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individuals to follow a trade or to pursue a manual,
2

technical, mechanical, industrial, business, or commercial
3

occupation.
4

(34) Beginning January 1, 2000, personal property,
5

including food, purchased through fundraising events for
6

the benefit of a public or private elementary or secondary
7

school, a group of those schools, or one or more school
8

districts if the events are sponsored by an entity
9

recognized by the school district that consists primarily
10

of volunteers and includes parents and teachers of the
11

school children. This paragraph does not apply to
12

fundraising events (i) for the benefit of private home
13

instruction or (ii) for which the fundraising entity
14

purchases the personal property sold at the events from
15

another individual or entity that sold the property for
16

the purpose of resale by the fundraising entity and that
17

profits from the sale to the fundraising entity. This
18

paragraph is exempt from the provisions of Section 2-70.
19

(35) Beginning January 1, 2000 and through December
20

31, 2001, new or used automatic vending machines that
21

prepare and serve hot food and beverages, including
22

coffee, soup, and other items, and replacement parts for
23

these machines. Beginning January 1, 2002 and through June
24

30, 2003, machines and parts for machines used in
25

commercial, coin-operated amusement and vending business
26

if a use or occupation tax is paid on the gross receipts

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derived from the use of the commercial, coin-operated
2

amusement and vending machines. This paragraph is exempt
3

from the provisions of Section 2-70.
4

(35-5) Beginning August 23, 2001 and through June 30,
5

2016, food for human consumption that is to be consumed
6

off the premises where it is sold (other than alcoholic
7

beverages, soft drinks, and food that has been prepared
8

for immediate consumption) and prescription and
9

nonprescription medicines, drugs, medical appliances, and
10

insulin, urine testing materials, syringes, and needles
11

used by diabetics, for human use, when purchased for use
12

by a person receiving medical assistance under Article V
13

of the Illinois Public Aid Code who resides in a licensed
14

long-term care facility, as defined in the Nursing Home
15

Care Act, or a licensed facility as defined in the ID/DD
16

Community Care Act, the MC/DD Act, or the Specialized
17

Mental Health Rehabilitation Act of 2013.
18

(36) Beginning August 2, 2001, computers and
19

communications equipment utilized for any hospital purpose
20

and equipment used in the diagnosis, analysis, or
21

treatment of hospital patients sold to a lessor who leases
22

the equipment, under a lease of one year or longer
23

executed or in effect at the time of the purchase, to a
24

hospital that has been issued an active tax exemption
25

identification number by the Department under Section 1g
26

of this Act. This paragraph is exempt from the provisions

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1

of Section 2-70.
2

(37) Beginning August 2, 2001, personal property sold
3

to a lessor who leases the property, under a lease of one
4

year or longer executed or in effect at the time of the
5

purchase, to a governmental body that has been issued an
6

active tax exemption identification number by the
7

Department under Section 1g of this Act. This paragraph is
8

exempt from the provisions of Section 2-70.
9

(38) Beginning on January 1, 2002 and through June 30,
10

2016, tangible personal property purchased from an
11

Illinois retailer by a taxpayer engaged in centralized
12

purchasing activities in Illinois who will, upon receipt
13

of the property in Illinois, temporarily store the
14

property in Illinois (i) for the purpose of subsequently
15

transporting it outside this State for use or consumption
16

thereafter solely outside this State or (ii) for the
17

purpose of being processed, fabricated, or manufactured
18

into, attached to, or incorporated into other tangible
19

personal property to be transported outside this State and
20

thereafter used or consumed solely outside this State. The
21

Director of Revenue shall, pursuant to rules adopted in
22

accordance with the Illinois Administrative Procedure Act,
23

issue a permit to any taxpayer in good standing with the
24

Department who is eligible for the exemption under this
25

paragraph (38). The permit issued under this paragraph
26

(38) shall authorize the holder, to the extent and in the

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manner specified in the rules adopted under this Act, to
2

purchase tangible personal property from a retailer exempt
3

from the taxes imposed by this Act. Taxpayers shall
4

maintain all necessary books and records to substantiate
5

the use and consumption of all such tangible personal
6

property outside of the State of Illinois.
7

(39) Beginning January 1, 2008, tangible personal
8

property used in the construction or maintenance of a
9

community water supply, as defined under Section 3.145 of
10

the Environmental Protection Act, that is operated by a
11

not-for-profit corporation that holds a valid water supply
12

permit issued under Title IV of the Environmental
13

Protection Act. This paragraph is exempt from the
14

provisions of Section 2-70.
15

(40) Beginning January 1, 2010 and continuing through
16

December 31, 2029, materials, parts, equipment,
17

components, and furnishings incorporated into or upon an
18

aircraft as part of the modification, refurbishment,
19

completion, replacement, repair, or maintenance of the
20

aircraft. This exemption includes consumable supplies used
21

in the modification, refurbishment, completion,
22

replacement, repair, and maintenance of aircraft. However,
23

until January 1, 2024, this exemption excludes any
24

materials, parts, equipment, components, and consumable
25

supplies used in the modification, replacement, repair,
26

and maintenance of aircraft engines or power plants,

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whether such engines or power plants are installed or
2

uninstalled upon any such aircraft. "Consumable supplies"
3

include, but are not limited to, adhesive, tape,
4

sandpaper, general purpose lubricants, cleaning solution,
5

latex gloves, and protective films.
6

Beginning January 1, 2010 and continuing through
7

December 31, 2023, this exemption applies only to the sale
8

of qualifying tangible personal property to persons who
9

modify, refurbish, complete, replace, or maintain an
10

aircraft and who (i) hold an Air Agency Certificate and
11

are empowered to operate an approved repair station by the
12

Federal Aviation Administration, (ii) have a Class IV
13

Rating, and (iii) conduct operations in accordance with
14

Part 145 of the Federal Aviation Regulations. The
15

exemption does not include aircraft operated by a
16

commercial air carrier providing scheduled passenger air
17

service pursuant to authority issued under Part 121 or
18

Part 129 of the Federal Aviation Regulations. From January
19

1, 2024 through December 31, 2029, this exemption applies
20

only to the sale of qualifying tangible personal property
21

to: (A) persons who modify, refurbish, complete, repair,
22

replace, or maintain aircraft and who (i) hold an Air
23

Agency Certificate and are empowered to operate an
24

approved repair station by the Federal Aviation
25

Administration, (ii) have a Class IV Rating, and (iii)
26

conduct operations in accordance with Part 145 of the

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Federal Aviation Regulations; and (B) persons who engage
2

in the modification, replacement, repair, and maintenance
3

of aircraft engines or power plants without regard to
4

whether or not those persons meet the qualifications of
5

item (A).
6

The changes made to this paragraph (40) by Public Act
7

98-534 are declarative of existing law. It is the intent
8

of the General Assembly that the exemption under this
9

paragraph (40) applies continuously from January 1, 2010
10

through December 31, 2024; however, no claim for credit or
11

refund is allowed for taxes paid as a result of the
12

disallowance of this exemption on or after January 1, 2015
13

and prior to February 5, 2020 (the effective date of
14

Public Act 101-629).
15

(41) Tangible personal property sold to a
16

public-facilities corporation, as described in Section
17

11-65-10 of the Illinois Municipal Code, for purposes of
18

constructing or furnishing a municipal convention hall,
19

but only if the legal title to the municipal convention
20

hall is transferred to the municipality without any
21

further consideration by or on behalf of the municipality
22

at the time of the completion of the municipal convention
23

hall or upon the retirement or redemption of any bonds or
24

other debt instruments issued by the public-facilities
25

corporation in connection with the development of the
26

municipal convention hall. This exemption includes

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existing public-facilities corporations as provided in
2

Section 11-65-25 of the Illinois Municipal Code. This
3

paragraph is exempt from the provisions of Section 2-70.
4

(42) Beginning January 1, 2017 and through December
5

31, 2026, menstrual pads, tampons, and menstrual cups.
6

(43) Merchandise that is subject to the Rental
7

Purchase Agreement Occupation and Use Tax. The purchaser
8

must certify that the item is purchased to be rented
9

subject to a rental-purchase agreement, as defined in the
10

Rental-Purchase Agreement Act, and provide proof of
11

registration under the Rental Purchase Agreement
12

Occupation and Use Tax Act. This paragraph is exempt from
13

the provisions of Section 2-70.
14

(44) Qualified tangible personal property used in the
15

construction or operation of a data center that has been
16

granted a certificate of exemption by the Department of
17

Commerce and Economic Opportunity, whether that tangible
18

personal property is purchased by the owner, operator, or
19

tenant of the data center or by a contractor or
20

subcontractor of the owner, operator, or tenant. Data
21

centers that would have qualified for a certificate of
22

exemption prior to January 1, 2020 had Public Act 101-31
23

been in effect, may apply for and obtain an exemption for
24

subsequent purchases of computer equipment or enabling
25

software purchased or leased to upgrade, supplement, or
26

replace computer equipment or enabling software purchased

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or leased in the original investment that would have
2

qualified.
3

The Department of Commerce and Economic Opportunity
4

shall grant a certificate of exemption under this item
5

(44) to qualified data centers as defined by Section
6

605-1025 of the Department of Commerce and Economic
7

Opportunity Law of the Civil Administrative Code of
8

Illinois.
9

For the purposes of this item (44):
10

"Data center" means a building or a series of
11

buildings rehabilitated or constructed to house
12

working servers in one physical location or multiple
13

sites within the State of Illinois.
14

"Qualified tangible personal property" means:
15

electrical systems and equipment; climate control and
16

chilling equipment and systems; mechanical systems and
17

equipment; monitoring and secure systems; emergency
18

generators; hardware; computers; servers; data storage
19

devices; network connectivity equipment; racks;
20

cabinets; telecommunications cabling infrastructure;
21

raised floor systems; peripheral components or
22

systems; software; mechanical, electrical, or plumbing
23

systems; battery systems; cooling systems and towers;
24

temperature control systems; other cabling; and other
25

data center infrastructure equipment and systems
26

necessary to operate qualified tangible personal

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property, including fixtures; and component parts of
2

any of the foregoing, including installation,
3

maintenance, repair, refurbishment, and replacement of
4

qualified tangible personal property to generate,
5

transform, transmit, distribute, or manage electricity
6

necessary to operate qualified tangible personal
7

property; and all other tangible personal property
8

that is essential to the operations of a computer data
9

center. The term "qualified tangible personal
10

property" also includes building materials physically
11

incorporated into the qualifying data center. To
12

document the exemption allowed under this Section, the
13

retailer must obtain from the purchaser a copy of the
14

certificate of eligibility issued by the Department of
15

Commerce and Economic Opportunity.
16

This item (44) is exempt from the provisions of
17

Section 2-70.
18

(45) Beginning January 1, 2020 and through December
19

31, 2020, sales of tangible personal property made by a
20

marketplace seller over a marketplace for which tax is due
21

under this Act but for which use tax has been collected and
22

remitted to the Department by a marketplace facilitator
23

under Section 2d of the Use Tax Act are exempt from tax
24

under this Act. A marketplace seller claiming this
25

exemption shall maintain books and records demonstrating
26

that the use tax on such sales has been collected and

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remitted by a marketplace facilitator. Marketplace sellers
2

that have properly remitted tax under this Act on such
3

sales may file a claim for credit as provided in Section 6
4

of this Act. No claim is allowed, however, for such taxes
5

for which a credit or refund has been issued to the
6

marketplace facilitator under the Use Tax Act, or for
7

which the marketplace facilitator has filed a claim for
8

credit or refund under the Use Tax Act.
9

(46) Beginning July 1, 2022, breast pumps, breast pump
10

collection and storage supplies, and breast pump kits.
11

This item (46) is exempt from the provisions of Section
12

2-70. As used in this item (46):
13

"Breast pump" means an electrically controlled or
14

manually controlled pump device designed or marketed to be
15

used to express milk from a human breast during lactation,
16

including the pump device and any battery, AC adapter, or
17

other power supply unit that is used to power the pump
18

device and is packaged and sold with the pump device at the
19

time of sale.
20

"Breast pump collection and storage supplies" means
21

items of tangible personal property designed or marketed
22

to be used in conjunction with a breast pump to collect
23

milk expressed from a human breast and to store collected
24

milk until it is ready for consumption.
25

"Breast pump collection and storage supplies"
26

includes, but is not limited to: breast shields and breast

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shield connectors; breast pump tubes and tubing adapters;
2

breast pump valves and membranes; backflow protectors and
3

backflow protector adaptors; bottles and bottle caps
4

specific to the operation of the breast pump; and breast
5

milk storage bags.
6

"Breast pump collection and storage supplies" does not
7

include: (1) bottles and bottle caps not specific to the
8

operation of the breast pump; (2) breast pump travel bags
9

and other similar carrying accessories, including ice
10

packs, labels, and other similar products; (3) breast pump
11

cleaning supplies; (4) nursing bras, bra pads, breast
12

shells, and other similar products; and (5) creams,
13

ointments, and other similar products that relieve
14

breastfeeding-related symptoms or conditions of the
15

breasts or nipples, unless sold as part of a breast pump
16

kit that is pre-packaged by the breast pump manufacturer
17

or distributor.
18

"Breast pump kit" means a kit that: (1) contains no
19

more than a breast pump, breast pump collection and
20

storage supplies, a rechargeable battery for operating the
21

breast pump, a breastmilk cooler, bottle stands, ice
22

packs, and a breast pump carrying case; and (2) is
23

pre-packaged as a breast pump kit by the breast pump
24

manufacturer or distributor.
25

(47) Tangible personal property sold by or on behalf
26

of the State Treasurer pursuant to the Revised Uniform

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Unclaimed Property Act. This item (47) is exempt from the
2

provisions of Section 2-70.
3

(48) Beginning on January 1, 2024, tangible personal
4

property purchased by an active duty member of the armed
5

forces of the United States who presents valid military
6

identification and purchases the property using a form of
7

payment where the federal government is the payor. The
8

member of the armed forces must complete, at the point of
9

sale, a form prescribed by the Department of Revenue
10

documenting that the transaction is eligible for the
11

exemption under this paragraph. Retailers must keep the
12

form as documentation of the exemption in their records
13

for a period of not less than 6 years. "Armed forces of the
14

United States" means the United States Army, Navy, Air
15

Force, Space Force, Marine Corps, or Coast Guard. This
16

paragraph is exempt from the provisions of Section 2-70.
17

(49) Beginning July 1, 2024, home-delivered meals
18

provided to Medicare or Medicaid recipients when payment
19

is made by an intermediary, such as a Medicare
20

Administrative Contractor, a Managed Care Organization, or
21

a Medicare Advantage Organization, pursuant to a
22

government contract. This paragraph (49) is exempt from
23

the provisions of Section 2-70.
24

(50) Beginning on January 1, 2026, as further defined
25

in Section 2-10, food for human consumption that is to be
26

consumed off the premises where it is sold (other than

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alcoholic beverages, food consisting of or infused with
2

adult use cannabis, soft drinks, candy, and food that has
3

been prepared for immediate consumption). This item (50)
4

is exempt from the provisions of Section 2-70.
5

(51) Gross receipts from the lease of the following
6

tangible personal property:
7

(1) computer software transferred subject to a
8

license that meets the following requirements:
9

(A) it is evidenced by a written agreement
10

signed by the licensor and the customer;
11

(i) an electronic agreement in which the
12

customer accepts the license by means of an
13

electronic signature that is verifiable and
14

can be authenticated and is attached to or
15

made part of the license will comply with this
16

requirement;
17

(ii) a license agreement in which the
18

customer electronically accepts the terms by
19

clicking "I agree" does not comply with this
20

requirement;
21

(B) it restricts the customer's duplication
22

and use of the software;
23

(C) it prohibits the customer from licensing,
24

sublicensing, or transferring the software to a
25

third party (except to a related party) without
26

the permission and continued control of the

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licensor;
2

(D) the licensor has a policy of providing
3

another copy at minimal or no charge if the
4

customer loses or damages the software, or of
5

permitting the licensee to make and keep an
6

archival copy, and such policy is either stated in
7

the license agreement, supported by the licensor's
8

books and records, or supported by a notarized
9

statement made under penalties of perjury by the
10

licensor; and
11

(E) the customer must destroy or return all
12

copies of the software to the licensor at the end
13

of the license period; this provision is deemed to
14

be met, in the case of a perpetual license,
15

without being set forth in the license agreement;
16

and
17

(2) property that is subject to a tax on lease
18

receipts imposed by a home rule unit of local
19

government if the ordinance imposing that tax was
20

adopted prior to January 1, 2023.
21

(52) A motor vehicle of the first division, as defined
22

in Section 1-146 of the Illinois Vehicle Code, that is
23

registered in the State to an Illinois resident who
24

acquired the vehicle while the Illinois resident was
25

stationed outside of this State as an active duty member
26

of the military. This item (52) is exempt from the

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provisions of Section 2-70.

2

As used in this item (52):

3

"Active duty member of the military" means a service
4

member who undertakes any full-time military training or
5

full-time military duty, no matter how described under
6

federal or State law, for which a service member is
7

ordered to report by the President, by the Governor of a
8

state, commonwealth, or territory of the United States, by
9

an act of Congress, or by any other appropriate military
10

authority.

11

"Illinois resident" means an individual who meets the
12

definition of "resident" under subparagraph (A) of
13

paragraph (20) of subsection (a) of Section 1501 of the
14

Illinois Income Tax Act.

15

"Service member" means a person who is a member of any
16

component of the United States Armed Forces or the
17

National Guard of any state, the District of Columbia, a
18

commonwealth, or a territory of the United States.

19
(Source: P.A. 103-9, Article 5, Section 5-20, eff. 6-7-23;
20
103-9, Article 15, Section 15-20, eff. 6-7-23; 103-154, eff.
21
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
22
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
23
103-781, eff. 8-5-24; 103-995, eff. 8-9-24; 104-6, eff.
24
6-16-25; 104-417, eff. 8-15-25.)

25

Section 25.
The Illinois Vehicle Code is amended by

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changing Section 3-1001 as follows:

2

(625 ILCS 5/3-1001)

(from Ch. 95 1/2, par. 3-1001)
3

Sec. 3-1001.
A tax is hereby imposed on the privilege of
4
using, in this State, any motor vehicle as defined in Section
5
1-146 of this Code acquired by gift, transfer, or purchase,
6
and having a year model designation preceding the year of
7
application for title by 5 or fewer years prior to October 1,
8
1985 and 10 or fewer years on and after October 1, 1985 and
9
prior to January 1, 1988. On and after January 1, 1988, the tax
10
shall apply to all motor vehicles without regard to model
11
year. Except that the tax shall not apply:
12

(i) if the use of the motor vehicle is otherwise taxed
13

under the Use Tax Act;
14

(ii) if the motor vehicle is bought and used by a
15

governmental agency or a society, association, foundation
16

or institution organized and operated exclusively for
17

charitable, religious or educational purposes;
18

(iii) if the use of the motor vehicle is not subject to
19

the Use Tax Act by reason of subsection (a), (b), (c), (d),
20

(e) or (f) of Section 3-55 of that Act dealing with the
21

prevention of actual or likely multistate taxation;
22

(iv) to implements of husbandry;
23

(v) when a junking certificate is issued pursuant to
24

Section 3-117(a) of this Code;
25

(vi) when a vehicle is subject to the replacement

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vehicle tax imposed by Section 3-2001 of this Act;
2

(vii) when the transfer is a gift to a beneficiary in
3

the administration of an estate and the beneficiary is a
4

surviving spouse;
5

(viii) if the motor vehicle is purchased for the
6

purpose of resale by a retailer registered under Section
7

2a of the Retailers' Occupation Tax Act
; or

8

(ix) if the use of the motor vehicle is not subject to
9

the Use Tax Act by reason of item (47) of Section 3-5 of
10

that Act
.
11

Prior to January 1, 1988, the rate of tax shall be 5% of
12
the selling price for each purchase of a motor vehicle covered
13
by Section 3-1001 of this Code. Except as hereinafter
14
provided, beginning January 1, 1988 and until January 1, 2022,
15
the rate of tax shall be as follows for transactions in which
16
the selling price of the motor vehicle is less than $15,000:
17
Number of Years Transpired After
Applicable Tax

18
Model Year of Motor Vehicle
19
1 or less
$390
20
2
290
21
3
215
22
4
165
23
5
115
24
6
90
25
7
80
26
8
65

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1
9
50
2
10
40
3
over 10
25
4
Except as hereinafter provided, beginning January 1, 1988 and
5
until January 1, 2022, the rate of tax shall be as follows for
6
transactions in which the selling price of the motor vehicle
7
is $15,000 or more:
8
Selling Price
Applicable Tax
9
$15,000 - $19,999
$ 750
10
$20,000 - $24,999
$1,000
11
$25,000 - $29,999
$1,250
12
$30,000 and over
$1,500
13

Except as hereinafter provided, beginning on January 1,
14
2022, the rate of tax shall be as follows for transactions in
15
which the selling price of the motor vehicle is less than
16
$15,000:
17

(1) if one year or less has transpired after the model
18

year of the vehicle, then the applicable tax is $465;
19

(2) if 2 years have transpired after the model year of
20

the motor vehicle, then the applicable tax is $365;
21

(3) if 3 years have transpired after the model year of
22

the motor vehicle, then the applicable tax is $290;
23

(4) if 4 years have transpired after the model year of
24

the motor vehicle, then the applicable tax is $240;
25

(5) if 5 years have transpired after the model year of
26

the motor vehicle, then the applicable tax is $190;

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(6) if 6 years have transpired after the model year of
2

the motor vehicle, then the applicable tax is $165;
3

(7) if 7 years have transpired after the model year of
4

the motor vehicle, then the applicable tax is $155;
5

(8) if 8 years have transpired after the model year of
6

the motor vehicle, then the applicable tax is $140;
7

(9) if 9 years have transpired after the model year of
8

the motor vehicle, then the applicable tax is $125;
9

(10) if 10 years have transpired after the model year
10

of the motor vehicle, then the applicable tax is $115; and
11

(11) if more than 10 years have transpired after the
12

model year of the motor vehicle, then the applicable tax
13

is $100.
14

Except as hereinafter provided, beginning on January 1,
15
2022, the rate of tax shall be as follows for transactions in
16
which the selling price of the motor vehicle is $15,000 or
17
more:
18

(1) if the selling price is $15,000 or more, but less
19

than $20,000, then the applicable tax shall be $850;
20

(2) if the selling price is $20,000 or more, but less
21

than $25,000, then the applicable tax shall be $1,100;
22

(3) if the selling price is $25,000 or more, but less
23

than $30,000, then the applicable tax shall be $1,350;
24

(4) if the selling price is $30,000 or more, but less
25

than $50,000, then the applicable tax shall be $1,600;
26

(5) if the selling price is $50,000 or more, but less

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1

than $100,000, then the applicable tax shall be $2,600;
2

(6) if the selling price is $100,000 or more, but less
3

than $1,000,000, then the applicable tax shall be $5,100;
4

and
5

(7) if the selling price is $1,000,000 or more, then
6

the applicable tax shall be $10,100.
7
For the following transactions, the tax rate shall be $15 for
8
each motor vehicle acquired in such transaction:
9

(i) when the transferee or purchaser is the spouse,
10

mother, father, brother, sister or child of the
11

transferor;
12

(ii) when the transfer is a gift to a beneficiary in
13

the administration of an estate, including, but not
14

limited to, the administration of an inter vivos trust
15

that became irrevocable upon the death of a grantor, and
16

the beneficiary is not a surviving spouse;
17

(iii) when a motor vehicle which has once been
18

subjected to the Illinois retailers' occupation tax or use
19

tax is transferred in connection with the organization,
20

reorganization, dissolution or partial liquidation of an
21

incorporated or unincorporated business wherein the
22

beneficial ownership is not changed.
23

A claim that the transaction is taxable under subparagraph
24
(i) shall be supported by such proof of family relationship as
25
provided by rules of the Department.
26

For a transaction in which a motorcycle, motor driven

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1
cycle or moped is acquired the tax rate shall be $25.
2

On and after October 1, 1985 and until January 1, 2022,
3
1/12 of $5,000,000 of the moneys received by the Department of
4
Revenue pursuant to this Section shall be paid each month into
5
the Build Illinois Fund; on and after January 1, 2022, 1/12 of
6
$40,000,000 of the moneys received by the Department of
7
Revenue pursuant to this Section shall be paid each month into
8
the Build Illinois Fund; and the remainder shall be paid into
9
the General Revenue Fund.
10

The tax imposed by this Section shall be abated and no
11
longer imposed when the amount deposited to secure the bonds
12
issued pursuant to the Build Illinois Bond Act is sufficient
13
to provide for the payment of the principal of, and interest
14
and premium, if any, on the bonds, as certified to the State
15
Comptroller and the Director of Revenue by the Director of the
16
Governor's Office of Management and Budget.
17
(Source: P.A. 104-6, eff. 6-16-25.)

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