REVENUE-SMALL NUCLEAR REACTOR

Illinois General Assembly - Full Text of SB2721

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2721

Introduced 10/28/2025, by Sen. Sue Rezin

SYNOPSIS AS INTRODUCED:

35 ILCS 5/246 new
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5

Amends the Illinois Income Tax Act. Creates an income tax credit for
taxpayers that make an investment in the manufacture of a small modular
nuclear reactor in the State during the taxable year. Provides that the
amount of the credit is 20% of the amount of that investment. Amends the
Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and
the Retailers' Occupation Tax Act. Provides that tangible personal
property purchased for use in the construction or operation of a small
modular nuclear reactor in the State is exempt from taxation under those
Act. Effective immediately.
LRB104 14845 HLH 27989 b

A BILL FOR

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LRB104 14845 HLH 27989 b
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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 Illinois Income Tax Act is amended by
5
adding Section 246 as follows:

6

(35 ILCS 5/246 new)
7

Sec. 246.
Small modular nuclear reactor manufacturing
8
expense tax credit.
9

(a) For taxable years beginning on or after January 1,
10
2026, each taxpayer that makes an investment in the
11
manufacture of a small modular nuclear reactor in the State
12
during the taxable year is entitled to a credit against the
13
taxes imposed by subsections (a) and (b) of Section 201 in an
14
amount equal to 20% of the amount of that investment.

15

(b) In no event shall a credit under this Section reduce
16
the taxpayer's liability to less than zero. If the amount of
17
the credit exceeds the tax liability for the year, the excess
18
may be carried forward and applied to the tax liability of the
19
5 taxable years following the excess credit year. The tax
20
credit shall be applied to the earliest year for which there is
21
a tax liability. If there are credits for more than one year
22
that are available to offset a liability, the earlier credit
23
shall be applied first.

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(c) For partners and shareholders of Subchapter S
2
corporations, the provisions of Section 251 shall apply with
3
respect to the credit under this Section.

4

(d) As used in this Section:

5

"Small modular nuclear reactor" means a nuclear reactor
6
that:

7

(1) has a rated electric generating capacity of not
8

more than 470 megawatts;

9

(2) is capable of being constructed and operated,
10

either:

11

(A) alone; or

12

(B) in combination with one or more similar
13

reactors at a single site if additional reactors are,
14

or become, necessary; and

15

(3) is required to be licensed by the United States
16

Nuclear Regulatory Commission.

17

"Small modular nuclear reactor" includes, but is not
18
limited to, a nuclear reactor that meets the criteria set
19
forth in this Section and that uses a process to produce
20
hydrogen that can be used for energy storage, as a fuel, or for
21
other uses.

22

(d) This Section is exempt from the provisions of Section
23
250.

24

Section 10.
The Use Tax Act is amended by changing Section
25
3-5 as follows:

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(35 ILCS 105/3-5)
2

Sec. 3-5.
Exemptions.
Use, which, on and after January 1,
3
2025, includes use by a lessee, of the following tangible
4
personal property is exempt from the tax imposed by this Act:
5

(1) Personal property purchased from a corporation,
6
society, association, foundation, institution, or
7
organization, other than a limited liability company, that is
8
organized and operated as a not-for-profit service enterprise
9
for the benefit of persons 65 years of age or older if the
10
personal property was not purchased by the enterprise for the
11
purpose of resale by the enterprise.
12

(2) Personal property purchased by a not-for-profit
13
Illinois county fair association for use in conducting,
14
operating, or promoting the county fair.
15

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

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effective date of Public Act 92-35), however, an entity
2
otherwise eligible for this exemption shall not make tax-free
3
purchases unless it has an active identification number issued
4
by the Department.
5

(4) Except as otherwise provided in this Act, personal
6
property purchased by a governmental body, by a corporation,
7
society, association, foundation, or institution organized and
8
operated exclusively for charitable, religious, or educational
9
purposes, or by a not-for-profit corporation, society,
10
association, foundation, institution, or organization that has
11
no compensated officers or employees and that is organized and
12
operated primarily for the recreation of persons 55 years of
13
age or older. A limited liability company may qualify for the
14
exemption under this paragraph only if the limited liability
15
company is organized and operated exclusively for educational
16
purposes. On and after July 1, 1987, however, no entity
17
otherwise eligible for this exemption shall make tax-free
18
purchases unless it has an active exemption identification
19
number issued by the Department.
20

(5) Until July 1, 2003, a passenger car that is a
21
replacement vehicle to the extent that the purchase price of
22
the car is subject to the Replacement Vehicle Tax.
23

(6) Until July 1, 2003 and beginning again on September 1,
24
2004 through August 30, 2014, graphic arts machinery and
25
equipment, including repair and replacement parts, both new
26
and used, and including that manufactured on special order,

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certified by the purchaser to be used primarily for graphic
2
arts production, and including machinery and equipment
3
purchased for lease. Equipment includes chemicals or chemicals
4
acting as catalysts but only if the chemicals or chemicals
5
acting as catalysts effect a direct and immediate change upon
6
a graphic arts product. Beginning on July 1, 2017, graphic
7
arts machinery and equipment is included in the manufacturing
8
and assembling machinery and equipment exemption under
9
paragraph (18).
10

(7) Farm chemicals.
11

(8) Legal tender, currency, medallions, or gold or silver
12
coinage issued by the State of Illinois, the government of the
13
United States of America, or the government of any foreign
14
country, and bullion.
15

(9) Personal property purchased from a teacher-sponsored
16
student organization affiliated with an elementary or
17
secondary school located in Illinois.
18

(10) A motor vehicle that is used for automobile renting,
19
as defined in the Automobile Renting Occupation and Use Tax
20
Act.
21

(11) Farm machinery and equipment, both new and used,
22
including that manufactured on special order, certified by the
23
purchaser to be used primarily for production agriculture or
24
State or federal agricultural programs, including individual
25
replacement parts for the machinery and equipment, including
26
machinery and equipment purchased for lease, and including

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

Farm machinery and equipment shall include precision
15
farming equipment that is installed or purchased to be
16
installed on farm machinery and equipment, including, but not
17
limited to, tractors, harvesters, sprayers, planters, seeders,
18
or spreaders. Precision farming equipment includes, but is not
19
limited to, soil testing sensors, computers, monitors,
20
software, global positioning and mapping systems, and other
21
such equipment.
22

Farm machinery and equipment also includes computers,
23
sensors, software, and related equipment used primarily in the
24
computer-assisted operation of production agriculture
25
facilities, equipment, and activities such as, but not limited
26
to, the collection, monitoring, and correlation of animal and

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crop data for the purpose of formulating animal diets and
2
agricultural chemicals.
3

Beginning on January 1, 2024, farm machinery and equipment
4
also includes electrical power generation equipment used
5
primarily for production agriculture.
6

This item (11) is exempt from the provisions of Section
7
3-90.
8

(12) Until June 30, 2013, fuel and petroleum products sold
9
to or used by an air common carrier, certified by the carrier
10
to be used for consumption, shipment, or storage in the
11
conduct of its business as an air common carrier, for a flight
12
destined for or returning from a location or locations outside
13
the United States without regard to previous or subsequent
14
domestic stopovers.
15

Beginning July 1, 2013, fuel and petroleum products sold
16
to or used by an air carrier, certified by the carrier to be
17
used for consumption, shipment, or storage in the conduct of
18
its business as an air common carrier, for a flight that (i) is
19
engaged in foreign trade or is engaged in trade between the
20
United States and any of its possessions and (ii) transports
21
at least one individual or package for hire from the city of
22
origination to the city of final destination on the same
23
aircraft, without regard to a change in the flight number of
24
that aircraft.
25

(13) Proceeds of mandatory service charges separately
26
stated on customers' bills for the purchase and consumption of

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food and beverages purchased at retail from a retailer, to the
2
extent that the proceeds of the service charge are in fact
3
turned over as tips or as a substitute for tips to the
4
employees who participate directly in preparing, serving,
5
hosting or cleaning up the food or beverage function with
6
respect to which the service charge is imposed.
7

(14) Until July 1, 2003, oil field exploration, drilling,
8
and production equipment, including (i) rigs and parts of
9
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
10
pipe and tubular goods, including casing and drill strings,
11
(iii) pumps and pump-jack units, (iv) storage tanks and flow
12
lines, (v) any individual replacement part for oil field
13
exploration, drilling, and production equipment, and (vi)
14
machinery and equipment purchased for lease; but excluding
15
motor vehicles required to be registered under the Illinois
16
Vehicle Code.
17

(15) Photoprocessing machinery and equipment, including
18
repair and replacement parts, both new and used, including
19
that manufactured on special order, certified by the purchaser
20
to be used primarily for photoprocessing, and including
21
photoprocessing machinery and equipment purchased for lease.
22

(16) Until July 1, 2028, coal and aggregate exploration,
23
mining, off-highway hauling, processing, maintenance, and
24
reclamation equipment, including replacement parts and
25
equipment, and including equipment purchased for lease, but
26
excluding motor vehicles required to be registered under the

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

(17) Until July 1, 2003, distillation machinery and
8
equipment, sold as a unit or kit, assembled or installed by the
9
retailer, certified by the user to be used only for the
10
production of ethyl alcohol that will be used for consumption
11
as motor fuel or as a component of motor fuel for the personal
12
use of the user, and not subject to sale or resale.
13

(18) Manufacturing and assembling machinery and equipment
14
used primarily in the process of manufacturing or assembling
15
tangible personal property for wholesale or retail sale or
16
lease, whether that sale or lease is made directly by the
17
manufacturer or by some other person, whether the materials
18
used in the process are owned by the manufacturer or some other
19
person, or whether that sale or lease is made apart from or as
20
an incident to the seller's engaging in the service occupation
21
of producing machines, tools, dies, jigs, patterns, gauges, or
22
other similar items of no commercial value on special order
23
for a particular purchaser. The exemption provided by this
24
paragraph (18) includes production related tangible personal
25
property, as defined in Section 3-50, purchased on or after
26
July 1, 2019. The exemption provided by this paragraph (18)

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does not include machinery and equipment used in (i) the
2
generation of electricity for wholesale or retail sale; (ii)
3
the generation or treatment of natural or artificial gas for
4
wholesale or retail sale that is delivered to customers
5
through pipes, pipelines, or mains; or (iii) the treatment of
6
water for wholesale or retail sale that is delivered to
7
customers through pipes, pipelines, or mains. The provisions
8
of Public Act 98-583 are declaratory of existing law as to the
9
meaning and scope of this exemption. Beginning on July 1,
10
2017, the exemption provided by this paragraph (18) includes,
11
but is not limited to, graphic arts machinery and equipment,
12
as defined in paragraph (6) of this Section.
13

(19) Personal property delivered to a purchaser or
14
purchaser's donee inside Illinois when the purchase order for
15
that personal property was received by a florist located
16
outside Illinois who has a florist located inside Illinois
17
deliver the personal property.
18

(20) Semen used for artificial insemination of livestock
19
for direct agricultural production.
20

(21) Horses, or interests in horses, registered with and
21
meeting the requirements of any of the Arabian Horse Club
22
Registry of America, Appaloosa Horse Club, American Quarter
23
Horse Association, United States Trotting Association, or
24
Jockey Club, as appropriate, used for purposes of breeding or
25
racing for prizes. This item (21) is exempt from the
26
provisions of Section 3-90, and the exemption provided for

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under this item (21) applies for all periods beginning May 30,
2
1995, but no claim for credit or refund is allowed on or after
3
January 1, 2008 for such taxes paid during the period
4
beginning May 30, 2000 and ending on January 1, 2008.
5

(22) Computers and communications equipment utilized for
6
any hospital purpose and equipment used in the diagnosis,
7
analysis, or treatment of hospital patients purchased by a
8
lessor who leases the equipment, under a lease of one year or
9
longer executed or in effect at the time the lessor would
10
otherwise be subject to the tax imposed by this Act, to a
11
hospital that has been issued an active tax exemption
12
identification number by the Department under Section 1g of
13
the Retailers' Occupation Tax Act. If the equipment is leased
14
in a manner that does not qualify for this exemption or is used
15
in any other non-exempt manner, the lessor shall be liable for
16
the tax imposed under this Act or the Service Use Tax Act, as
17
the case may be, based on the fair market value of the property
18
at the time the non-qualifying use occurs. No lessor shall
19
collect or attempt to collect an amount (however designated)
20
that purports to reimburse that lessor for the tax imposed by
21
this Act or the Service Use Tax Act, as the case may be, if the
22
tax has not been paid by the lessor. If a lessor improperly
23
collects any such amount from the lessee, the lessee shall
24
have a legal right to claim a refund of that amount from the
25
lessor. If, however, that amount is not refunded to the lessee
26
for any reason, the lessor is liable to pay that amount to the

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Department.
2

(23) Personal property purchased by a lessor who leases
3
the property, under a lease of one year or longer executed or
4
in effect at the time the lessor would otherwise be subject to
5
the tax imposed by this Act, to a governmental body that has
6
been issued an active sales tax exemption identification
7
number by the Department under Section 1g of the Retailers'
8
Occupation Tax Act. If the property is leased in a manner that
9
does not qualify for this exemption or used in any other
10
non-exempt manner, the lessor shall be liable for the tax
11
imposed under this Act or the Service Use Tax Act, as the case
12
may be, based on the fair market value of the property at the
13
time the non-qualifying use occurs. No lessor shall collect or
14
attempt to collect an amount (however designated) that
15
purports to reimburse that lessor for the tax imposed by this
16
Act or the Service Use Tax Act, as the case may be, if the tax
17
has not been paid by the lessor. If a lessor improperly
18
collects any such amount from the lessee, the lessee shall
19
have a legal right to claim a refund of that amount from the
20
lessor. If, however, that amount is not refunded to the lessee
21
for any reason, the lessor is liable to pay that amount to the
22
Department.
23

(24) Beginning with taxable years ending on or after
24
December 31, 1995 and ending with taxable years ending on or
25
before December 31, 2004, personal property that is donated
26
for disaster relief to be used in a State or federally declared

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

(25) Beginning with taxable years ending on or after
8
December 31, 1995 and ending with taxable years ending on or
9
before December 31, 2004, personal property that is used in
10
the performance of infrastructure repairs in this State,
11
including, but not limited to, municipal roads and streets,
12
access roads, bridges, sidewalks, waste disposal systems,
13
water and sewer line extensions, water distribution and
14
purification facilities, storm water drainage and retention
15
facilities, and sewage treatment facilities, resulting from a
16
State or federally declared disaster in Illinois or bordering
17
Illinois when such repairs are initiated on facilities located
18
in the declared disaster area within 6 months after the
19
disaster.
20

(26) Beginning July 1, 1999, game or game birds purchased
21
at a "game breeding and hunting preserve area" as that term is
22
used in the Wildlife Code. This paragraph is exempt from the
23
provisions of Section 3-90.
24

(27) A motor vehicle, as that term is defined in Section
25
1-146 of the Illinois Vehicle Code, that is donated to a
26
corporation, limited liability company, society, association,

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

(28) Beginning January 1, 2000, personal property,
18
including food, purchased through fundraising events for the
19
benefit of a public or private elementary or secondary school,
20
a group of those schools, or one or more school districts if
21
the events are sponsored by an entity recognized by the school
22
district that consists primarily of volunteers and includes
23
parents and teachers of the school children. This paragraph
24
does not apply to fundraising events (i) for the benefit of
25
private home instruction or (ii) for which the fundraising
26
entity purchases the personal property sold at the events from

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another individual or entity that sold the property for the
2
purpose of resale by the fundraising entity and that profits
3
from the sale to the fundraising entity. This paragraph is
4
exempt from the provisions of Section 3-90.
5

(29) Beginning January 1, 2000 and through December 31,
6
2001, new or used automatic vending machines that prepare and
7
serve hot food and beverages, including coffee, soup, and
8
other items, and replacement parts for these machines.
9
Beginning January 1, 2002 and through June 30, 2003, machines
10
and parts for machines used in commercial, coin-operated
11
amusement and vending business if a use or occupation tax is
12
paid on the gross receipts derived from the use of the
13
commercial, coin-operated amusement and vending machines. This
14
paragraph is exempt from the provisions of Section 3-90.
15

(30) Beginning January 1, 2001 and through June 30, 2016,
16
food for human consumption that is to be consumed off the
17
premises where it is sold (other than alcoholic beverages,
18
soft drinks, and food that has been prepared for immediate
19
consumption) and prescription and nonprescription medicines,
20
drugs, medical appliances, and insulin, urine testing
21
materials, syringes, and needles used by diabetics, for human
22
use, when purchased for use by a person receiving medical
23
assistance under Article V of the Illinois Public Aid Code who
24
resides in a licensed long-term care facility, as defined in
25
the Nursing Home Care Act, or in a licensed facility as defined
26
in the ID/DD Community Care Act, the MC/DD Act, or the

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1
Specialized Mental Health Rehabilitation Act of 2013.
2

(31) Beginning on August 2, 2001 (the effective date of
3
Public Act 92-227), computers and communications equipment
4
utilized for any hospital purpose and equipment used in the
5
diagnosis, analysis, or treatment of hospital patients
6
purchased by a lessor who leases the equipment, under a lease
7
of one year or longer executed or in effect at the time the
8
lessor would otherwise be subject to the tax imposed by this
9
Act, to a hospital that has been issued an active tax exemption
10
identification number by the Department under Section 1g of
11
the Retailers' Occupation Tax Act. If the equipment is leased
12
in a manner that does not qualify for this exemption or is used
13
in any other nonexempt manner, the lessor shall be liable for
14
the tax imposed under this Act or the Service Use Tax Act, as
15
the case may be, based on the fair market value of the property
16
at the time the nonqualifying use occurs. No lessor shall
17
collect or attempt to collect an amount (however designated)
18
that purports to reimburse that lessor for the tax imposed by
19
this Act or the Service Use Tax Act, as the case may be, if the
20
tax has not been paid by the lessor. If a lessor improperly
21
collects any such amount from the lessee, the lessee shall
22
have a legal right to claim a refund of that amount from the
23
lessor. If, however, that amount is not refunded to the lessee
24
for any reason, the lessor is liable to pay that amount to the
25
Department. This paragraph is exempt from the provisions of
26
Section 3-90.

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(32) Beginning on August 2, 2001 (the effective date of
2
Public Act 92-227), personal property purchased by a lessor
3
who leases the property, under a lease of one year or longer
4
executed or in effect at the time the lessor would otherwise be
5
subject to the tax imposed by this Act, to a governmental body
6
that has been issued an active sales tax exemption
7
identification number by the Department under Section 1g of
8
the Retailers' Occupation Tax Act. If the property is leased
9
in a manner that does not qualify for this exemption or used in
10
any other nonexempt manner, the lessor shall be liable for the
11
tax imposed under this Act or the Service Use Tax Act, as the
12
case may be, based on the fair market value of the property at
13
the time the nonqualifying use occurs. No lessor shall collect
14
or attempt to collect an amount (however designated) that
15
purports to reimburse that lessor for the tax imposed by this
16
Act or the Service Use Tax Act, as the case may be, if the tax
17
has not been paid by the lessor. If a lessor improperly
18
collects any such amount from the lessee, the lessee shall
19
have a legal right to claim a refund of that amount from the
20
lessor. If, however, that amount is not refunded to the lessee
21
for any reason, the lessor is liable to pay that amount to the
22
Department. This paragraph is exempt from the provisions of
23
Section 3-90.
24

(33) On and after July 1, 2003 and through June 30, 2004,
25
the use in this State of motor vehicles of the second division
26
with a gross vehicle weight in excess of 8,000 pounds and that

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are subject to the commercial distribution fee imposed under
2
Section 3-815.1 of the Illinois Vehicle Code. Beginning on
3
July 1, 2004 and through June 30, 2005, the use in this State
4
of motor vehicles of the second division: (i) with a gross
5
vehicle weight rating in excess of 8,000 pounds; (ii) that are
6
subject to the commercial distribution fee imposed under
7
Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
8
are primarily used for commercial purposes. Through June 30,
9
2005, this exemption applies to repair and replacement parts
10
added after the initial purchase of such a motor vehicle if
11
that motor vehicle is used in a manner that would qualify for
12
the rolling stock exemption otherwise provided for in this
13
Act. For purposes of this paragraph, the term "used for
14
commercial purposes" means the transportation of persons or
15
property in furtherance of any commercial or industrial
16
enterprise, whether for-hire or not.
17

(34) Beginning January 1, 2008, tangible personal property
18
used in the construction or maintenance of a community water
19
supply, as defined under Section 3.145 of the Environmental
20
Protection Act, that is operated by a not-for-profit
21
corporation that holds a valid water supply permit issued
22
under Title IV of the Environmental Protection Act. This
23
paragraph is exempt from the provisions of Section 3-90.
24

(35) Beginning January 1, 2010 and continuing through
25
December 31, 2029, materials, parts, equipment, components,
26
and furnishings incorporated into or upon an aircraft as part

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of the modification, refurbishment, completion, replacement,
2
repair, or maintenance of the aircraft. This exemption
3
includes consumable supplies used in the modification,
4
refurbishment, completion, replacement, repair, and
5
maintenance of aircraft. However, until January 1, 2024, this
6
exemption excludes any materials, parts, equipment,
7
components, and consumable supplies used in the modification,
8
replacement, repair, and maintenance of aircraft engines or
9
power plants, whether such engines or power plants are
10
installed or uninstalled upon any such aircraft. "Consumable
11
supplies" include, but are not limited to, adhesive, tape,
12
sandpaper, general purpose lubricants, cleaning solution,
13
latex gloves, and protective films.
14

Beginning January 1, 2010 and continuing through December
15
31, 2023, this exemption applies only to the use of qualifying
16
tangible personal property by persons who modify, refurbish,
17
complete, repair, replace, or maintain aircraft and who (i)
18
hold an Air Agency Certificate and are empowered to operate an
19
approved repair station by the Federal Aviation
20
Administration, (ii) have a Class IV Rating, and (iii) conduct
21
operations in accordance with Part 145 of the Federal Aviation
22
Regulations. From January 1, 2024 through December 31, 2029,
23
this exemption applies only to the use of qualifying tangible
24
personal property by: (A) persons who modify, refurbish,
25
complete, repair, replace, or maintain aircraft and who (i)
26
hold an Air Agency Certificate and are empowered to operate an

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approved repair station by the Federal Aviation
2
Administration, (ii) have a Class IV Rating, and (iii) conduct
3
operations in accordance with Part 145 of the Federal Aviation
4
Regulations; and (B) persons who engage in the modification,
5
replacement, repair, and maintenance of aircraft engines or
6
power plants without regard to whether or not those persons
7
meet the qualifications of item (A).
8

The exemption does not include aircraft operated by a
9
commercial air carrier providing scheduled passenger air
10
service pursuant to authority issued under Part 121 or Part
11
129 of the Federal Aviation Regulations. The changes made to
12
this paragraph (35) by Public Act 98-534 are declarative of
13
existing law. It is the intent of the General Assembly that the
14
exemption under this paragraph (35) applies continuously from
15
January 1, 2010 through December 31, 2024; however, no claim
16
for credit or refund is allowed for taxes paid as a result of
17
the disallowance of this exemption on or after January 1, 2015
18
and prior to February 5, 2020 (the effective date of Public Act
19
101-629).
20

(36) Tangible personal property purchased by a
21
public-facilities corporation, as described in Section
22
11-65-10 of the Illinois Municipal Code, for purposes of
23
constructing or furnishing a municipal convention hall, but
24
only if the legal title to the municipal convention hall is
25
transferred to the municipality without any further
26
consideration by or on behalf of the municipality at the time

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of the completion of the municipal convention hall or upon the
2
retirement or redemption of any bonds or other debt
3
instruments issued by the public-facilities corporation in
4
connection with the development of the municipal convention
5
hall. This exemption includes existing public-facilities
6
corporations as provided in Section 11-65-25 of the Illinois
7
Municipal Code. This paragraph is exempt from the provisions
8
of Section 3-90.
9

(37) Beginning January 1, 2017 and through December 31,
10
2026, menstrual pads, tampons, and menstrual cups.
11

(38) Merchandise that is subject to the Rental Purchase
12
Agreement Occupation and Use Tax. The purchaser must certify
13
that the item is purchased to be rented subject to a
14
rental-purchase agreement, as defined in the Rental-Purchase
15
Agreement Act, and provide proof of registration under the
16
Rental Purchase Agreement Occupation and Use Tax Act. This
17
paragraph is exempt from the provisions of Section 3-90.
18

(39) Tangible personal property purchased by a purchaser
19
who is exempt from the tax imposed by this Act by operation of
20
federal law. This paragraph is exempt from the provisions of
21
Section 3-90.
22

(40) Qualified tangible personal property used in the
23
construction or operation of a data center that has been
24
granted a certificate of exemption by the Department of
25
Commerce and Economic Opportunity, whether that tangible
26
personal property is purchased by the owner, operator, or

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tenant of the data center or by a contractor or subcontractor
2
of the owner, operator, or tenant. Data centers that would
3
have qualified for a certificate of exemption prior to January
4
1, 2020 had Public Act 101-31 been in effect may apply for and
5
obtain an exemption for subsequent purchases of computer
6
equipment or enabling software purchased or leased to upgrade,
7
supplement, or replace computer equipment or enabling software
8
purchased or leased in the original investment that would have
9
qualified.
10

The Department of Commerce and Economic Opportunity shall
11
grant a certificate of exemption under this item (40) to
12
qualified data centers as defined by Section 605-1025 of the
13
Department of Commerce and Economic Opportunity Law of the
14
Civil Administrative Code of Illinois.
15

For the purposes of this item (40):
16

"Data center" means a building or a series of
17

buildings rehabilitated or constructed to house working
18

servers in one physical location or multiple sites within
19

the State of Illinois.
20

"Qualified tangible personal property" means:
21

electrical systems and equipment; climate control and
22

chilling equipment and systems; mechanical systems and
23

equipment; monitoring and secure systems; emergency
24

generators; hardware; computers; servers; data storage
25

devices; network connectivity equipment; racks; cabinets;
26

telecommunications cabling infrastructure; raised floor

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systems; peripheral components or systems; software;
2

mechanical, electrical, or plumbing systems; battery
3

systems; cooling systems and towers; temperature control
4

systems; other cabling; and other data center
5

infrastructure equipment and systems necessary to operate
6

qualified tangible personal property, including fixtures;
7

and component parts of any of the foregoing, including
8

installation, maintenance, repair, refurbishment, and
9

replacement of qualified tangible personal property to
10

generate, transform, transmit, distribute, or manage
11

electricity necessary to operate qualified tangible
12

personal property; and all other tangible personal
13

property that is essential to the operations of a computer
14

data center. The term "qualified tangible personal
15

property" also includes building materials physically
16

incorporated into the qualifying data center. To document
17

the exemption allowed under this Section, the retailer
18

must obtain from the purchaser a copy of the certificate
19

of eligibility issued by the Department of Commerce and
20

Economic Opportunity.
21

This item (40) is exempt from the provisions of Section
22
3-90.
23

(41) Beginning July 1, 2022, breast pumps, breast pump
24
collection and storage supplies, and breast pump kits. This
25
item (41) is exempt from the provisions of Section 3-90. As
26
used in this item (41):

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"Breast pump" means an electrically controlled or
2

manually controlled pump device designed or marketed to be
3

used to express milk from a human breast during lactation,
4

including the pump device and any battery, AC adapter, or
5

other power supply unit that is used to power the pump
6

device and is packaged and sold with the pump device at the
7

time of sale.
8

"Breast pump collection and storage supplies" means
9

items of tangible personal property designed or marketed
10

to be used in conjunction with a breast pump to collect
11

milk expressed from a human breast and to store collected
12

milk until it is ready for consumption.
13

"Breast pump collection and storage supplies"
14

includes, but is not limited to: breast shields and breast
15

shield connectors; breast pump tubes and tubing adapters;
16

breast pump valves and membranes; backflow protectors and
17

backflow protector adaptors; bottles and bottle caps
18

specific to the operation of the breast pump; and breast
19

milk storage bags.
20

"Breast pump collection and storage supplies" does not
21

include: (1) bottles and bottle caps not specific to the
22

operation of the breast pump; (2) breast pump travel bags
23

and other similar carrying accessories, including ice
24

packs, labels, and other similar products; (3) breast pump
25

cleaning supplies; (4) nursing bras, bra pads, breast
26

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

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ointments, and other similar products that relieve
2

breastfeeding-related symptoms or conditions of the
3

breasts or nipples, unless sold as part of a breast pump
4

kit that is pre-packaged by the breast pump manufacturer
5

or distributor.
6

"Breast pump kit" means a kit that: (1) contains no
7

more than a breast pump, breast pump collection and
8

storage supplies, a rechargeable battery for operating the
9

breast pump, a breastmilk cooler, bottle stands, ice
10

packs, and a breast pump carrying case; and (2) is
11

pre-packaged as a breast pump kit by the breast pump
12

manufacturer or distributor.
13

(42) Tangible personal property sold by or on behalf of
14
the State Treasurer pursuant to the Revised Uniform Unclaimed
15
Property Act. This item (42) is exempt from the provisions of
16
Section 3-90.
17

(43) Beginning on January 1, 2024, tangible personal
18
property purchased by an active duty member of the armed
19
forces of the United States who presents valid military
20
identification and purchases the property using a form of
21
payment where the federal government is the payor. The member
22
of the armed forces must complete, at the point of sale, a form
23
prescribed by the Department of Revenue documenting that the
24
transaction is eligible for the exemption under this
25
paragraph. Retailers must keep the form as documentation of
26
the exemption in their records for a period of not less than 6

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years. "Armed forces of the United States" means the United
2
States Army, Navy, Air Force, Space Force, Marine Corps, or
3
Coast Guard. This paragraph is exempt from the provisions of
4
Section 3-90.
5

(44) Beginning July 1, 2024, home-delivered meals provided
6
to Medicare or Medicaid recipients when payment is made by an
7
intermediary, such as a Medicare Administrative Contractor, a
8
Managed Care Organization, or a Medicare Advantage
9
Organization, pursuant to a government contract. This item
10
(44) is exempt from the provisions of Section 3-90.
11

(45)

(44)
Beginning on January 1, 2026, as further defined
12
in Section 3-10, food for human consumption that is to be
13
consumed off the premises where it is sold (other than
14
alcoholic beverages, food consisting of or infused with adult
15
use cannabis, soft drinks, candy, and food that has been
16
prepared for immediate consumption). This item
(45)

(44)
is
17
exempt from the provisions of Section 3-90.
18

(46)

(44)
Use by the lessee of the following leased
19
tangible personal property:
20

(1) software transferred subject to a license that
21

meets the following requirements:
22

(A) it is evidenced by a written agreement signed
23

by the licensor and the customer;
24

(i) an electronic agreement in which the
25

customer accepts the license by means of an
26

electronic signature that is verifiable and can be

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authenticated and is attached to or made part of
2

the license will comply with this requirement;
3

(ii) a license agreement in which the customer
4

electronically accepts the terms by clicking "I
5

agree" does not comply with this requirement;
6

(B) it restricts the customer's duplication and
7

use of the software;
8

(C) it prohibits the customer from licensing,
9

sublicensing, or transferring the software to a third
10

party (except to a related party) without the
11

permission and continued control of the licensor;
12

(D) the licensor has a policy of providing another
13

copy at minimal or no charge if the customer loses or
14

damages the software, or of permitting the licensee to
15

make and keep an archival copy, and such policy is
16

either stated in the license agreement, supported by
17

the licensor's books and records, or supported by a
18

notarized statement made under penalties of perjury by
19

the licensor; and
20

(E) the customer must destroy or return all copies
21

of the software to the licensor at the end of the
22

license period; this provision is deemed to be met, in
23

the case of a perpetual license, without being set
24

forth in the license agreement; and
25

(2) property that is subject to a tax on lease
26

receipts imposed by a home rule unit of local government

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if the ordinance imposing that tax was adopted prior to
2

January 1, 2023.
3

(47) Beginning on January 1, 2027, tangible personal
4
property purchased for use in the construction or operation of
5
a small modular nuclear reactor in the State. This item is
6
exempt from the provisions of Section 3-90.

7

As used in this item (47):

8

"Small modular nuclear reactor" means a nuclear reactor
9
that:

10

(A) has a rated electric generating capacity of not
11

more than 470 megawatts;

12

(B) is capable of being constructed and operated,
13

either:

14

(i) alone; or

15

(ii) in combination with one or more similar
16

reactors at a single site if additional reactors are,
17

or become, necessary; and

18

(C) is required to be licensed by the United States
19

Nuclear Regulatory Commission.

20

"Small modular nuclear reactor" includes, but is not
21
limited to, a nuclear reactor that meets the criteria set
22
forth in this item (47) and that uses a process to produce
23
hydrogen that can be used for energy storage, as a fuel, or for
24
other uses.

25
(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
26
Section 70-5, eff. 4-19-22; 102-700, Article 75, Section 75-5,

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eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
2
Section 5-5, eff. 6-7-23; 103-9, Article 15, Section 15-5,
3
eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
4
103-592, eff. 1-1-25; 103-605, eff. 7-1-24; 103-643, eff.
5
7-1-24; 103-746, eff. 1-1-25; 103-781, eff. 8-5-24; revised
6
11-26-24.)

7

Section 15.
The Service Use Tax Act is amended by changing
8
Section 3-5 as follows:

9

(35 ILCS 110/3-5)
10

Sec. 3-5.
Exemptions.
Use of the following tangible
11
personal property is exempt from the tax imposed by this Act:
12

(1) Personal property purchased from a corporation,
13
society, association, foundation, institution, or
14
organization, other than a limited liability company, that is
15
organized and operated as a not-for-profit service enterprise
16
for the benefit of persons 65 years of age or older if the
17
personal property was not purchased by the enterprise for the
18
purpose of resale by the enterprise.
19

(2) Personal property purchased by a non-profit Illinois
20
county fair association for use in conducting, operating, or
21
promoting the county fair.
22

(3) Personal property purchased by a not-for-profit arts
23
or cultural organization that establishes, by proof required
24
by the Department by rule, that it has received an exemption

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under Section 501(c)(3) of the Internal Revenue Code and that
2
is organized and operated primarily for the presentation or
3
support of arts or cultural programming, activities, or
4
services. These organizations include, but are not limited to,
5
music and dramatic arts organizations such as symphony
6
orchestras and theatrical groups, arts and cultural service
7
organizations, local arts councils, visual arts organizations,
8
and media arts organizations. On and after July 1, 2001 (the
9
effective date of Public Act 92-35), however, an entity
10
otherwise eligible for this exemption shall not make tax-free
11
purchases unless it has an active identification number issued
12
by the Department.
13

(4) Legal tender, currency, medallions, or gold or silver
14
coinage issued by the State of Illinois, the government of the
15
United States of America, or the government of any foreign
16
country, and bullion.
17

(5) Until July 1, 2003 and beginning again on September 1,
18
2004 through August 30, 2014, graphic arts machinery and
19
equipment, including repair and replacement parts, both new
20
and used, and including that manufactured on special order or
21
purchased for lease, certified by the purchaser to be used
22
primarily for graphic arts production. Equipment includes
23
chemicals or chemicals acting as catalysts but only if the
24
chemicals or chemicals acting as catalysts effect a direct and
25
immediate change upon a graphic arts product. Beginning on
26
July 1, 2017, graphic arts machinery and equipment is included

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in the manufacturing and assembling machinery and equipment
2
exemption under Section 2 of this Act.
3

(6) Personal property purchased from a teacher-sponsored
4
student organization affiliated with an elementary or
5
secondary school located in Illinois.
6

(7) Farm machinery and equipment, both new and used,
7
including that manufactured on special order, certified by the
8
purchaser to be used primarily for production agriculture or
9
State or federal agricultural programs, including individual
10
replacement parts for the machinery and equipment, including
11
machinery and equipment purchased for lease, and including
12
implements of husbandry defined in Section 1-130 of the
13
Illinois Vehicle Code, farm machinery and agricultural
14
chemical and fertilizer spreaders, and nurse wagons required
15
to be registered under Section 3-809 of the Illinois Vehicle
16
Code, but excluding other motor vehicles required to be
17
registered under the Illinois Vehicle Code. Horticultural
18
polyhouses or hoop houses used for propagating, growing, or
19
overwintering plants shall be considered farm machinery and
20
equipment under this item (7). Agricultural chemical tender
21
tanks and dry boxes shall include units sold separately from a
22
motor vehicle required to be licensed and units sold mounted
23
on a motor vehicle required to be licensed if the selling price
24
of the tender is separately stated.
25

Farm machinery and equipment shall include precision
26
farming equipment that is installed or purchased to be

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installed on farm machinery and equipment, including, but not
2
limited to, tractors, harvesters, sprayers, planters, seeders,
3
or spreaders. Precision farming equipment includes, but is not
4
limited to, soil testing sensors, computers, monitors,
5
software, global positioning and mapping systems, and other
6
such equipment.
7

Farm machinery and equipment also includes computers,
8
sensors, software, and related equipment used primarily in the
9
computer-assisted operation of production agriculture
10
facilities, equipment, and activities such as, but not limited
11
to, the collection, monitoring, and correlation of animal and
12
crop data for the purpose of formulating animal diets and
13
agricultural chemicals.
14

Beginning on January 1, 2024, farm machinery and equipment
15
also includes electrical power generation equipment used
16
primarily for production agriculture.
17

This item (7) is exempt from the provisions of Section
18
3-75.
19

(8) Until June 30, 2013, fuel and petroleum products sold
20
to or used by an air common carrier, certified by the carrier
21
to be used for consumption, shipment, or storage in the
22
conduct of its business as an air common carrier, for a flight
23
destined for or returning from a location or locations outside
24
the United States without regard to previous or subsequent
25
domestic stopovers.
26

Beginning July 1, 2013, fuel and petroleum products sold

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to or used by an air carrier, certified by the carrier to be
2
used for consumption, shipment, or storage in the conduct of
3
its business as an air common carrier, for a flight that (i) is
4
engaged in foreign trade or is engaged in trade between the
5
United States and any of its possessions and (ii) transports
6
at least one individual or package for hire from the city of
7
origination to the city of final destination on the same
8
aircraft, without regard to a change in the flight number of
9
that aircraft.
10

(9) Proceeds of mandatory service charges separately
11
stated on customers' bills for the purchase and consumption of
12
food and beverages acquired as an incident to the purchase of a
13
service from a serviceman, to the extent that the proceeds of
14
the service charge are in fact turned over as tips or as a
15
substitute for tips to the employees who participate directly
16
in preparing, serving, hosting or cleaning up the food or
17
beverage function with respect to which the service charge is
18
imposed.
19

(10) Until July 1, 2003, oil field exploration, drilling,
20
and production equipment, including (i) rigs and parts of
21
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
22
pipe and tubular goods, including casing and drill strings,
23
(iii) pumps and pump-jack units, (iv) storage tanks and flow
24
lines, (v) any individual replacement part for oil field
25
exploration, drilling, and production equipment, and (vi)
26
machinery and equipment purchased for lease; but excluding

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motor vehicles required to be registered under the Illinois
2
Vehicle Code.
3

(11) Proceeds from the sale of photoprocessing machinery
4
and equipment, including repair and replacement parts, both
5
new and used, including that manufactured on special order,
6
certified by the purchaser to be used primarily for
7
photoprocessing, and including photoprocessing machinery and
8
equipment purchased for lease.
9

(12) Until July 1, 2028, coal and aggregate exploration,
10
mining, off-highway hauling, processing, maintenance, and
11
reclamation equipment, including replacement parts and
12
equipment, and including equipment purchased for lease, but
13
excluding motor vehicles required to be registered under the
14
Illinois Vehicle Code. The changes made to this Section by
15
Public Act 97-767 apply on and after July 1, 2003, but no claim
16
for credit or refund is allowed on or after August 16, 2013
17
(the effective date of Public Act 98-456) for such taxes paid
18
during the period beginning July 1, 2003 and ending on August
19
16, 2013 (the effective date of Public Act 98-456).
20

(13) Semen used for artificial insemination of livestock
21
for direct agricultural production.
22

(14) Horses, or interests in horses, registered with and
23
meeting the requirements of any of the Arabian Horse Club
24
Registry of America, Appaloosa Horse Club, American Quarter
25
Horse Association, United States Trotting Association, or
26
Jockey Club, as appropriate, used for purposes of breeding or

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racing for prizes. This item (14) is exempt from the
2
provisions of Section 3-75, and the exemption provided for
3
under this item (14) applies for all periods beginning May 30,
4
1995, but no claim for credit or refund is allowed on or after
5
January 1, 2008 (the effective date of Public Act 95-88) for
6
such taxes paid during the period beginning May 30, 2000 and
7
ending on January 1, 2008 (the effective date of Public Act
8
95-88).
9

(15) Computers and communications equipment utilized for
10
any hospital purpose and equipment used in the diagnosis,
11
analysis, or treatment of hospital patients purchased by a
12
lessor who leases the equipment, under a lease of one year or
13
longer executed or in effect at the time the lessor would
14
otherwise be subject to the tax imposed by this Act, 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. If the equipment is leased
18
in a manner that does not qualify for this exemption or is used
19
in any other non-exempt manner, the lessor shall be liable for
20
the tax imposed under this Act or the Use Tax Act, as the case
21
may be, based on the fair market value of the property at the
22
time the non-qualifying use occurs. No lessor shall collect or
23
attempt to collect an amount (however designated) that
24
purports to reimburse that lessor for the tax imposed by this
25
Act or the Use Tax Act, as the case may be, if the tax has not
26
been paid by the lessor. If a lessor improperly collects any

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such amount from the lessee, the lessee shall have a legal
2
right to claim a refund of that amount from the lessor. If,
3
however, that amount is not refunded to the lessee for any
4
reason, the lessor is liable to pay that amount to the
5
Department.
6

(16) Personal property purchased by a lessor who leases
7
the property, under a lease of one year or longer executed or
8
in effect at the time the lessor would otherwise be subject to
9
the tax imposed by this Act, to a governmental body that has
10
been issued an active tax exemption identification number by
11
the Department under Section 1g of the Retailers' Occupation
12
Tax Act. If the property is leased in a manner that does not
13
qualify for this exemption or is used in any other non-exempt
14
manner, the lessor shall be liable for the tax imposed under
15
this Act or the Use Tax Act, as the case may be, based on the
16
fair market value of the property at the time the
17
non-qualifying use occurs. No lessor shall collect or attempt
18
to collect an amount (however designated) that purports to
19
reimburse that lessor for the tax imposed by this Act or the
20
Use Tax Act, as the case may be, if the tax has not been paid
21
by the lessor. If a lessor improperly collects any such amount
22
from the lessee, the lessee shall have a legal right to claim a
23
refund of that amount from the lessor. If, however, that
24
amount is not refunded to the lessee for any reason, the lessor
25
is liable to pay that amount to the Department.
26

(17) Beginning with taxable years ending on or after

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December 31, 1995 and ending with taxable years ending on or
2
before December 31, 2004, personal property that is donated
3
for disaster relief to be used in a State or federally declared
4
disaster area in Illinois or bordering Illinois by a
5
manufacturer or retailer that is registered in this State to a
6
corporation, society, association, foundation, or institution
7
that has been issued a sales tax exemption identification
8
number by the Department that assists victims of the disaster
9
who reside within the declared disaster area.
10

(18) Beginning with taxable years ending on or after
11
December 31, 1995 and ending with taxable years ending on or
12
before December 31, 2004, personal property that is used in
13
the performance of infrastructure repairs in this State,
14
including, but not limited to, municipal roads and streets,
15
access roads, bridges, sidewalks, waste disposal systems,
16
water and sewer line extensions, water distribution and
17
purification facilities, storm water drainage and retention
18
facilities, and sewage treatment facilities, resulting from a
19
State or federally declared disaster in Illinois or bordering
20
Illinois when such repairs are initiated on facilities located
21
in the declared disaster area within 6 months after the
22
disaster.
23

(19) Beginning July 1, 1999, game or game birds purchased
24
at a "game breeding and hunting preserve area" as that term is
25
used in the Wildlife Code. This paragraph is exempt from the
26
provisions of Section 3-75.

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(20) A motor vehicle, as that term is defined in Section
2
1-146 of the Illinois Vehicle Code, that is donated to a
3
corporation, limited liability company, society, association,
4
foundation, or institution that is determined by the
5
Department to be organized and operated exclusively for
6
educational purposes. For purposes of this exemption, "a
7
corporation, limited liability company, society, association,
8
foundation, or institution organized and operated exclusively
9
for educational purposes" means all tax-supported public
10
schools, private schools that offer systematic instruction in
11
useful branches of learning by methods common to public
12
schools and that compare favorably in their scope and
13
intensity with the course of study presented in tax-supported
14
schools, and vocational or technical schools or institutes
15
organized and operated exclusively to provide a course of
16
study of not less than 6 weeks duration and designed to prepare
17
individuals to follow a trade or to pursue a manual,
18
technical, mechanical, industrial, business, or commercial
19
occupation.
20

(21) Beginning January 1, 2000, personal property,
21
including food, purchased through fundraising events for the
22
benefit of a public or private elementary or secondary school,
23
a group of those schools, or one or more school districts if
24
the events are sponsored by an entity recognized by the school
25
district that consists primarily of volunteers and includes
26
parents and teachers of the school children. This paragraph

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does not apply to fundraising events (i) for the benefit of
2
private home instruction or (ii) for which the fundraising
3
entity purchases the personal property sold at the events from
4
another individual or entity that sold the property for the
5
purpose of resale by the fundraising entity and that profits
6
from the sale to the fundraising entity. This paragraph is
7
exempt from the provisions of Section 3-75.
8

(22) Beginning January 1, 2000 and through December 31,
9
2001, new or used automatic vending machines that prepare and
10
serve hot food and beverages, including coffee, soup, and
11
other items, and replacement parts for these machines.
12
Beginning January 1, 2002 and through June 30, 2003, machines
13
and parts for machines used in commercial, coin-operated
14
amusement and vending business if a use or occupation tax is
15
paid on the gross receipts derived from the use of the
16
commercial, coin-operated amusement and vending machines. This
17
paragraph is exempt from the provisions of Section 3-75.
18

(23) Beginning August 23, 2001 and through June 30, 2016,
19
food for human consumption that is to be consumed off the
20
premises where it is sold (other than alcoholic beverages,
21
soft drinks, and food that has been prepared for immediate
22
consumption) and prescription and nonprescription medicines,
23
drugs, medical appliances, and insulin, urine testing
24
materials, syringes, and needles used by diabetics, for human
25
use, when purchased for use by a person receiving medical
26
assistance under Article V of the Illinois Public Aid Code who

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resides in a licensed long-term care facility, as defined in
2
the Nursing Home Care Act, or in a licensed facility as defined
3
in the ID/DD Community Care Act, the MC/DD Act, or the
4
Specialized Mental Health Rehabilitation Act of 2013.
5

(24) Beginning on August 2, 2001 (the effective date of
6
Public Act 92-227), computers and communications equipment
7
utilized for any hospital purpose and equipment used in the
8
diagnosis, analysis, or treatment of hospital patients
9
purchased by a lessor who leases the equipment, under a lease
10
of one year or longer executed or in effect at the time the
11
lessor would otherwise be subject to the tax imposed by this
12
Act, to a hospital that has been issued an active tax exemption
13
identification number by the Department under Section 1g of
14
the Retailers' Occupation Tax Act. If the equipment is leased
15
in a manner that does not qualify for this exemption or is used
16
in any other nonexempt manner, the lessor shall be liable for
17
the tax imposed under this Act or the Use Tax Act, as the case
18
may be, based on the fair market value of the property at the
19
time the nonqualifying use occurs. No lessor shall collect or
20
attempt to collect an amount (however designated) that
21
purports to reimburse that lessor for the tax imposed by this
22
Act or the Use Tax Act, as the case may be, if the tax has not
23
been paid by the lessor. If a lessor improperly collects any
24
such amount from the lessee, the lessee shall have a legal
25
right to claim a refund of that amount from the lessor. If,
26
however, that amount is not refunded to the lessee for any

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reason, the lessor is liable to pay that amount to the
2
Department. This paragraph is exempt from the provisions of
3
Section 3-75.
4

(25) Beginning on August 2, 2001 (the effective date of
5
Public Act 92-227), personal property purchased by a lessor
6
who leases the property, under a lease of one year or longer
7
executed or in effect at the time the lessor would otherwise be
8
subject to the tax imposed by this Act, to a governmental body
9
that has been issued an active tax exemption identification
10
number by the Department under Section 1g of the Retailers'
11
Occupation Tax Act. If the property is leased in a manner that
12
does not qualify for this exemption or is used in any other
13
nonexempt manner, the lessor shall be liable for the tax
14
imposed under this Act or the Use Tax Act, as the case may be,
15
based on the fair market value of the property at the time the
16
nonqualifying use occurs. No lessor shall collect or attempt
17
to collect an amount (however designated) that purports to
18
reimburse that lessor for the tax imposed by this Act or the
19
Use Tax Act, as the case may be, if the tax has not been paid
20
by the lessor. If a lessor improperly collects any such amount
21
from the lessee, the lessee shall have a legal right to claim a
22
refund of that amount from the lessor. If, however, that
23
amount is not refunded to the lessee for any reason, the lessor
24
is liable to pay that amount to the Department. This paragraph
25
is exempt from the provisions of Section 3-75.
26

(26) Beginning January 1, 2008, tangible personal property

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used in the construction or maintenance of a community water
2
supply, as defined under Section 3.145 of the Environmental
3
Protection Act, that is operated by a not-for-profit
4
corporation that holds a valid water supply permit issued
5
under Title IV of the Environmental Protection Act. This
6
paragraph is exempt from the provisions of Section 3-75.
7

(27) Beginning January 1, 2010 and continuing through
8
December 31, 2029, materials, parts, equipment, components,
9
and furnishings incorporated into or upon an aircraft as part
10
of the modification, refurbishment, completion, replacement,
11
repair, or maintenance of the aircraft. This exemption
12
includes consumable supplies used in the modification,
13
refurbishment, completion, replacement, repair, and
14
maintenance of aircraft. However, until January 1, 2024, this
15
exemption excludes any materials, parts, equipment,
16
components, and consumable supplies used in the modification,
17
replacement, repair, and maintenance of aircraft engines or
18
power plants, whether such engines or power plants are
19
installed or uninstalled upon any such aircraft. "Consumable
20
supplies" include, but are not limited to, adhesive, tape,
21
sandpaper, general purpose lubricants, cleaning solution,
22
latex gloves, and protective films.
23

Beginning January 1, 2010 and continuing through December
24
31, 2023, this exemption applies only to the use of qualifying
25
tangible personal property transferred incident to the
26
modification, refurbishment, completion, replacement, repair,

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

The exemption does not include aircraft operated by a
19
commercial air carrier providing scheduled passenger air
20
service pursuant to authority issued under Part 121 or Part
21
129 of the Federal Aviation Regulations. The changes made to
22
this paragraph (27) by Public Act 98-534 are declarative of
23
existing law. It is the intent of the General Assembly that the
24
exemption under this paragraph (27) applies continuously from
25
January 1, 2010 through December 31, 2024; however, no claim
26
for credit or refund is allowed for taxes paid as a result of

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the disallowance of this exemption on or after January 1, 2015
2
and prior to February 5, 2020 (the effective date of Public Act
3
101-629).
4

(28) Tangible personal property purchased by a
5
public-facilities corporation, as described in Section
6
11-65-10 of the Illinois Municipal Code, for purposes of
7
constructing or furnishing a municipal convention hall, but
8
only if the legal title to the municipal convention hall is
9
transferred to the municipality without any further
10
consideration by or on behalf of the municipality at the time
11
of the completion of the municipal convention hall or upon the
12
retirement or redemption of any bonds or other debt
13
instruments issued by the public-facilities corporation in
14
connection with the development of the municipal convention
15
hall. This exemption includes existing public-facilities
16
corporations as provided in Section 11-65-25 of the Illinois
17
Municipal Code. This paragraph is exempt from the provisions
18
of Section 3-75.
19

(29) Beginning January 1, 2017 and through December 31,
20
2026, menstrual pads, tampons, and menstrual cups.
21

(30) Tangible personal property transferred to a purchaser
22
who is exempt from the tax imposed by this Act by operation of
23
federal law. This paragraph is exempt from the provisions of
24
Section 3-75.
25

(31) Qualified tangible personal property used in the
26
construction or operation of a data center that has been

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granted a certificate of exemption by the Department of
2
Commerce and Economic Opportunity, whether that tangible
3
personal property is purchased by the owner, operator, or
4
tenant of the data center or by a contractor or subcontractor
5
of the owner, operator, or tenant. Data centers that would
6
have qualified for a certificate of exemption prior to January
7
1, 2020 had Public Act 101-31 been in effect, may apply for and
8
obtain an exemption for subsequent purchases of computer
9
equipment or enabling software purchased or leased to upgrade,
10
supplement, or replace computer equipment or enabling software
11
purchased or leased in the original investment that would have
12
qualified.
13

The Department of Commerce and Economic Opportunity shall
14
grant a certificate of exemption under this item (31) to
15
qualified data centers as defined by Section 605-1025 of the
16
Department of Commerce and Economic Opportunity Law of the
17
Civil Administrative Code of Illinois.
18

For the purposes of this item (31):
19

"Data center" means a building or a series of
20

buildings rehabilitated or constructed to house working
21

servers in one physical location or multiple sites within
22

the State of Illinois.
23

"Qualified tangible personal property" means:
24

electrical systems and equipment; climate control and
25

chilling equipment and systems; mechanical systems and
26

equipment; monitoring and secure systems; emergency

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generators; hardware; computers; servers; data storage
2

devices; network connectivity equipment; racks; cabinets;
3

telecommunications cabling infrastructure; raised floor
4

systems; peripheral components or systems; software;
5

mechanical, electrical, or plumbing systems; battery
6

systems; cooling systems and towers; temperature control
7

systems; other cabling; and other data center
8

infrastructure equipment and systems necessary to operate
9

qualified tangible personal property, including fixtures;
10

and component parts of any of the foregoing, including
11

installation, maintenance, repair, refurbishment, and
12

replacement of qualified tangible personal property to
13

generate, transform, transmit, distribute, or manage
14

electricity necessary to operate qualified tangible
15

personal property; and all other tangible personal
16

property that is essential to the operations of a computer
17

data center. The term "qualified tangible personal
18

property" also includes building materials physically
19

incorporated into the qualifying data center. To document
20

the exemption allowed under this Section, the retailer
21

must obtain from the purchaser a copy of the certificate
22

of eligibility issued by the Department of Commerce and
23

Economic Opportunity.
24

This item (31) is exempt from the provisions of Section
25
3-75.
26

(32) Beginning July 1, 2022, breast pumps, breast pump

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collection and storage supplies, and breast pump kits. This
2
item (32) is exempt from the provisions of Section 3-75. As
3
used in this item (32):
4

"Breast pump" means an electrically controlled or
5

manually controlled pump device designed or marketed to be
6

used to express milk from a human breast during lactation,
7

including the pump device and any battery, AC adapter, or
8

other power supply unit that is used to power the pump
9

device and is packaged and sold with the pump device at the
10

time of sale.
11

"Breast pump collection and storage supplies" means
12

items of tangible personal property designed or marketed
13

to be used in conjunction with a breast pump to collect
14

milk expressed from a human breast and to store collected
15

milk until it is ready for consumption.
16

"Breast pump collection and storage supplies"
17

includes, but is not limited to: breast shields and breast
18

shield connectors; breast pump tubes and tubing adapters;
19

breast pump valves and membranes; backflow protectors and
20

backflow protector adaptors; bottles and bottle caps
21

specific to the operation of the breast pump; and breast
22

milk storage bags.
23

"Breast pump collection and storage supplies" does not
24

include: (1) bottles and bottle caps not specific to the
25

operation of the breast pump; (2) breast pump travel bags
26

and other similar carrying accessories, including ice

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packs, labels, and other similar products; (3) breast pump
2

cleaning supplies; (4) nursing bras, bra pads, breast
3

shells, and other similar products; and (5) creams,
4

ointments, and other similar products that relieve
5

breastfeeding-related symptoms or conditions of the
6

breasts or nipples, unless sold as part of a breast pump
7

kit that is pre-packaged by the breast pump manufacturer
8

or distributor.
9

"Breast pump kit" means a kit that: (1) contains no
10

more than a breast pump, breast pump collection and
11

storage supplies, a rechargeable battery for operating the
12

breast pump, a breastmilk cooler, bottle stands, ice
13

packs, and a breast pump carrying case; and (2) is
14

pre-packaged as a breast pump kit by the breast pump
15

manufacturer or distributor.
16

(33) Tangible personal property sold by or on behalf of
17
the State Treasurer pursuant to the Revised Uniform Unclaimed
18
Property Act. This item (33) is exempt from the provisions of
19
Section 3-75.
20

(34) Beginning on January 1, 2024, tangible personal
21
property purchased by an active duty member of the armed
22
forces of the United States who presents valid military
23
identification and purchases the property using a form of
24
payment where the federal government is the payor. The member
25
of the armed forces must complete, at the point of sale, a form
26
prescribed by the Department of Revenue documenting that the

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transaction is eligible for the exemption under this
2
paragraph. Retailers must keep the form as documentation of
3
the exemption in their records for a period of not less than 6
4
years. "Armed forces of the United States" means the United
5
States Army, Navy, Air Force, Space Force, Marine Corps, or
6
Coast Guard. This paragraph is exempt from the provisions of
7
Section 3-75.
8

(35) Beginning July 1, 2024, home-delivered meals provided
9
to Medicare or Medicaid recipients when payment is made by an
10
intermediary, such as a Medicare Administrative Contractor, a
11
Managed Care Organization, or a Medicare Advantage
12
Organization, pursuant to a government contract. This
13
paragraph (35) is exempt from the provisions of Section 3-75.
14

(36)

(35)
Beginning on January 1, 2026, as further defined
15
in Section 3-10, food prepared for immediate consumption and
16
transferred incident to a sale of service subject to this Act
17
or the Service Occupation Tax Act by an entity licensed under
18
the Hospital Licensing Act, the Nursing Home Care Act, the
19
Assisted Living and Shared Housing Act, the ID/DD Community
20
Care Act, the MC/DD Act, the Specialized Mental Health
21
Rehabilitation Act of 2013, or the Child Care Act of 1969
,
or
22
by an entity that holds a permit issued pursuant to the Life
23
Care Facilities Act. This item
(36)

(35)
is exempt from the
24
provisions of Section 3-75.
25

(37)

(36)
Beginning on January 1, 2026, as further defined
26
in Section 3-10, food for human consumption that is to be

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consumed off the premises where it is sold (other than
2
alcoholic beverages, food consisting of or infused with adult
3
use cannabis, soft drinks, candy, and food that has been
4
prepared for immediate consumption). This item
(37)

(36)
is
5
exempt from the provisions of Section 3-75.
6

(38)

(35)
Use by a lessee of the following leased tangible
7
personal property:
8

(1) software transferred subject to a license that
9

meets the following requirements:
10

(A) it is evidenced by a written agreement signed
11

by the licensor and the customer;
12

(i) an electronic agreement in which the
13

customer accepts the license by means of an
14

electronic signature that is verifiable and can be
15

authenticated and is attached to or made part of
16

the license will comply with this requirement;
17

(ii) a license agreement in which the customer
18

electronically accepts the terms by clicking "I
19

agree" does not comply with this requirement;
20

(B) it restricts the customer's duplication and
21

use of the software;
22

(C) it prohibits the customer from licensing,
23

sublicensing, or transferring the software to a third
24

party (except to a related party) without the
25

permission and continued control of the licensor;
26

(D) the licensor has a policy of providing another

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copy at minimal or no charge if the customer loses or
2

damages the software, or of permitting the licensee to
3

make and keep an archival copy, and such policy is
4

either stated in the license agreement, supported by
5

the licensor's books and records, or supported by a
6

notarized statement made under penalties of perjury by
7

the licensor; and
8

(E) the customer must destroy or return all copies
9

of the software to the licensor at the end of the
10

license period; this provision is deemed to be met, in
11

the case of a perpetual license, without being set
12

forth in the license agreement; and
13

(2) property that is subject to a tax on lease
14

receipts imposed by a home rule unit of local government
15

if the ordinance imposing that tax was adopted prior to
16

January 1, 2023.
17

(39) Beginning on January 1, 2027, tangible personal
18
property purchased for use in the construction or operation of
19
a small modular nuclear reactor in the State. This item is
20
exempt from the provisions of Section 3-75.

21

As used in this item (39):

22

"Small modular nuclear reactor" means a nuclear reactor
23
that:

24

(A) has a rated electric generating capacity of not
25

more than 470 megawatts;

26

(B) is capable of being constructed and operated,

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either:

2

(i) alone; or

3

(ii) in combination with one or more similar
4

reactors at a single site if additional reactors are,
5

or become, necessary; and

6

(C) is required to be licensed by the United States
7

Nuclear Regulatory Commission.

8

"Small modular nuclear reactor" includes, but is not
9
limited to, a nuclear reactor that meets the criteria set
10
forth in this item (39) and that uses a process to produce
11
hydrogen that can be used for energy storage, as a fuel, or for
12
other uses.

13
(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
14
Section 70-10, eff. 4-19-22; 102-700, Article 75, Section
15
75-10, eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
16
Section 5-10, eff. 6-7-23; 103-9, Article 15, Section 15-10,
17
eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
18
103-592, eff. 1-1-25; 103-605, eff. 7-1-24; 103-643, eff.
19
7-1-24; 103-746, eff. 1-1-25; 103-781, eff. 8-5-24; 103-995,
20
eff. 8-9-24; revised 11-26-24.)

21

Section 20.
The Service Occupation Tax Act is amended by
22
changing Section 3-5 as follows:

23

(35 ILCS 115/3-5)
24

Sec. 3-5.
Exemptions.
The following tangible personal

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property is exempt from the tax imposed by this Act:
2

(1) Personal property sold by a corporation, society,
3
association, foundation, institution, or organization, other
4
than a limited liability company, that is organized and
5
operated as a not-for-profit service enterprise for the
6
benefit of persons 65 years of age or older if the personal
7
property was not purchased by the enterprise for the purpose
8
of resale by the enterprise.
9

(2) Personal property purchased by a not-for-profit
10
Illinois county fair association for use in conducting,
11
operating, or promoting the county fair.
12

(3) Personal property purchased by any not-for-profit arts
13
or cultural organization that establishes, by proof required
14
by the Department by rule, that it has received an exemption
15
under Section 501(c)(3) of the Internal Revenue Code and that
16
is organized and operated primarily for the presentation or
17
support of arts or cultural programming, activities, or
18
services. These organizations include, but are not limited to,
19
music and dramatic arts organizations such as symphony
20
orchestras and theatrical groups, arts and cultural service
21
organizations, local arts councils, visual arts organizations,
22
and media arts organizations. On and after July 1, 2001 (the
23
effective date of Public Act 92-35), however, an entity
24
otherwise eligible for this exemption shall not make tax-free
25
purchases unless it has an active identification number issued
26
by the Department.

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(4) Legal tender, currency, medallions, or gold or silver
2
coinage issued by the State of Illinois, the government of the
3
United States of America, or the government of any foreign
4
country, and bullion.
5

(5) Until July 1, 2003 and beginning again on September 1,
6
2004 through August 30, 2014, graphic arts machinery and
7
equipment, including repair and replacement parts, both new
8
and used, and including that manufactured on special order or
9
purchased for lease, certified by the purchaser to be used
10
primarily for graphic arts production. Equipment includes
11
chemicals or chemicals acting as catalysts but only if the
12
chemicals or chemicals acting as catalysts effect a direct and
13
immediate change upon a graphic arts product. Beginning on
14
July 1, 2017, graphic arts machinery and equipment is included
15
in the manufacturing and assembling machinery and equipment
16
exemption under Section 2 of this Act.
17

(6) Personal property sold by a teacher-sponsored student
18
organization affiliated with an elementary or secondary school
19
located in Illinois.
20

(7) Farm machinery and equipment, both new and used,
21
including that manufactured on special order, certified by the
22
purchaser to be used primarily for production agriculture or
23
State or federal agricultural programs, including individual
24
replacement parts for the machinery and equipment, including
25
machinery and equipment purchased for lease, and including
26
implements of husbandry defined in Section 1-130 of the

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

Farm machinery and equipment shall include precision
14
farming equipment that is installed or purchased to be
15
installed on farm machinery and equipment, including, but not
16
limited to, tractors, harvesters, sprayers, planters, seeders,
17
or spreaders. Precision farming equipment includes, but is not
18
limited to, soil testing sensors, computers, monitors,
19
software, global positioning and mapping systems, and other
20
such equipment.
21

Farm machinery and equipment also includes computers,
22
sensors, software, and related equipment used primarily in the
23
computer-assisted operation of production agriculture
24
facilities, equipment, and activities such as, but not limited
25
to, the collection, monitoring, and correlation of animal and
26
crop data for the purpose of formulating animal diets and

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agricultural chemicals.
2

Beginning on January 1, 2024, farm machinery and equipment
3
also includes electrical power generation equipment used
4
primarily for production agriculture.
5

This item (7) is exempt from the provisions of Section
6
3-55.
7

(8) Until June 30, 2013, fuel and petroleum products sold
8
to or used by an air common carrier, certified by the carrier
9
to be used for consumption, shipment, or storage in the
10
conduct of its business as an air common carrier, for a flight
11
destined for or returning from a location or locations outside
12
the United States without regard to previous or subsequent
13
domestic stopovers.
14

Beginning July 1, 2013, fuel and petroleum products sold
15
to or used by an air carrier, certified by the carrier to be
16
used for consumption, shipment, or storage in the conduct of
17
its business as an air common carrier, for a flight that (i) is
18
engaged in foreign trade or is engaged in trade between the
19
United States and any of its possessions and (ii) transports
20
at least one individual or package for hire from the city of
21
origination to the city of final destination on the same
22
aircraft, without regard to a change in the flight number of
23
that aircraft.
24

(9) Proceeds of mandatory service charges separately
25
stated on customers' bills for the purchase and consumption of
26
food and beverages, to the extent that the proceeds of the

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service charge are in fact turned over as tips or as a
2
substitute for tips to the employees who participate directly
3
in preparing, serving, hosting or cleaning up the food or
4
beverage function with respect to which the service charge is
5
imposed.
6

(10) Until July 1, 2003, oil field exploration, drilling,
7
and production equipment, including (i) rigs and parts of
8
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
9
pipe and tubular goods, including casing and drill strings,
10
(iii) pumps and pump-jack units, (iv) storage tanks and flow
11
lines, (v) any individual replacement part for oil field
12
exploration, drilling, and production equipment, and (vi)
13
machinery and equipment purchased for lease; but excluding
14
motor vehicles required to be registered under the Illinois
15
Vehicle Code.
16

(11) Photoprocessing machinery and equipment, including
17
repair and replacement parts, both new and used, including
18
that manufactured on special order, certified by the purchaser
19
to be used primarily for photoprocessing, and including
20
photoprocessing machinery and equipment purchased for lease.
21

(12) Until July 1, 2028, coal and aggregate exploration,
22
mining, off-highway hauling, processing, maintenance, and
23
reclamation equipment, including replacement parts and
24
equipment, and including equipment purchased for lease, but
25
excluding motor vehicles required to be registered under the
26
Illinois Vehicle Code. The changes made to this Section by

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Public Act 97-767 apply on and after July 1, 2003, but no claim
2
for credit or refund is allowed on or after August 16, 2013
3
(the effective date of Public Act 98-456) for such taxes paid
4
during the period beginning July 1, 2003 and ending on August
5
16, 2013 (the effective date of Public Act 98-456).
6

(13) Beginning January 1, 1992 and through June 30, 2016,
7
food for human consumption that is to be consumed off the
8
premises where it is sold (other than alcoholic beverages,
9
soft drinks and food that has been prepared for immediate
10
consumption) and prescription and non-prescription medicines,
11
drugs, medical appliances, and insulin, urine testing
12
materials, syringes, and needles used by diabetics, for human
13
use, when purchased for use by a person receiving medical
14
assistance under Article V of the Illinois Public Aid Code who
15
resides in a licensed long-term care facility, as defined in
16
the Nursing Home Care Act, or in a licensed facility as defined
17
in the ID/DD Community Care Act, the MC/DD Act, or the
18
Specialized Mental Health Rehabilitation Act of 2013.
19

(14) Semen used for artificial insemination of livestock
20
for direct agricultural production.
21

(15) Horses, or interests in horses, registered with and
22
meeting the requirements of any of the Arabian Horse Club
23
Registry of America, Appaloosa Horse Club, American Quarter
24
Horse Association, United States Trotting Association, or
25
Jockey Club, as appropriate, used for purposes of breeding or
26
racing for prizes. This item (15) is exempt from the

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

(16) Computers and communications equipment utilized for
9
any hospital purpose and equipment used in the diagnosis,
10
analysis, or treatment of hospital patients sold to a lessor
11
who leases the equipment, under a lease of one year or longer
12
executed or in effect at the time of the purchase, to a
13
hospital that has been issued an active tax exemption
14
identification number by the Department under Section 1g of
15
the Retailers' Occupation Tax Act.
16

(17) Personal property sold to a lessor who leases the
17
property, under a lease of one year or longer executed or in
18
effect at the time of the purchase, to a governmental body that
19
has been issued an active tax exemption identification number
20
by the Department under Section 1g of the Retailers'
21
Occupation Tax Act.
22

(18) Beginning with taxable years ending on or after
23
December 31, 1995 and ending with taxable years ending on or
24
before December 31, 2004, personal property that is donated
25
for disaster relief to be used in a State or federally declared
26
disaster area in Illinois or bordering Illinois by a

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

(19) Beginning with taxable years ending on or after
7
December 31, 1995 and ending with taxable years ending on or
8
before December 31, 2004, personal property that is used in
9
the performance of infrastructure repairs in this State,
10
including, but not limited to, municipal roads and streets,
11
access roads, bridges, sidewalks, waste disposal systems,
12
water and sewer line extensions, water distribution and
13
purification facilities, storm water drainage and retention
14
facilities, and sewage treatment facilities, resulting from a
15
State or federally declared disaster in Illinois or bordering
16
Illinois when such repairs are initiated on facilities located
17
in the declared disaster area within 6 months after the
18
disaster.
19

(20) Beginning July 1, 1999, game or game birds sold at a
20
"game breeding and hunting preserve area" as that term is used
21
in the Wildlife Code. This paragraph is exempt from the
22
provisions of Section 3-55.
23

(21) A motor vehicle, as that term is defined in Section
24
1-146 of the Illinois Vehicle Code, that is donated to a
25
corporation, limited liability company, society, association,
26
foundation, or institution that is determined by the

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

(22) Beginning January 1, 2000, personal property,
17
including food, purchased through fundraising events for the
18
benefit of a public or private elementary or secondary school,
19
a group of those schools, or one or more school districts if
20
the events are sponsored by an entity recognized by the school
21
district that consists primarily of volunteers and includes
22
parents and teachers of the school children. This paragraph
23
does not apply to fundraising events (i) for the benefit of
24
private home instruction or (ii) for which the fundraising
25
entity purchases the personal property sold at the events from
26
another individual or entity that sold the property for the

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purpose of resale by the fundraising entity and that profits
2
from the sale to the fundraising entity. This paragraph is
3
exempt from the provisions of Section 3-55.
4

(23) Beginning January 1, 2000 and through December 31,
5
2001, new or used automatic vending machines that prepare and
6
serve hot food and beverages, including coffee, soup, and
7
other items, and replacement parts for these machines.
8
Beginning January 1, 2002 and through June 30, 2003, machines
9
and parts for machines used in commercial, coin-operated
10
amusement and vending business if a use or occupation tax is
11
paid on the gross receipts derived from the use of the
12
commercial, coin-operated amusement and vending machines. This
13
paragraph is exempt from the provisions of Section 3-55.
14

(24) Beginning on August 2, 2001 (the effective date of
15
Public Act 92-227), computers and communications equipment
16
utilized for any hospital purpose and equipment used in the
17
diagnosis, analysis, or treatment of hospital patients sold to
18
a lessor who leases the equipment, under a lease of one year or
19
longer executed or in effect at the time of the purchase, to a
20
hospital that has been issued an active tax exemption
21
identification number by the Department under Section 1g of
22
the Retailers' Occupation Tax Act. This paragraph is exempt
23
from the provisions of Section 3-55.
24

(25) Beginning on August 2, 2001 (the effective date of
25
Public Act 92-227), personal property sold to a lessor who
26
leases the property, under a lease of one year or longer

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executed or in effect at the time of the purchase, to a
2
governmental body that has been issued an active tax exemption
3
identification number by the Department under Section 1g of
4
the Retailers' Occupation Tax Act. This paragraph is exempt
5
from the provisions of Section 3-55.
6

(26) Beginning on January 1, 2002 and through June 30,
7
2016, tangible personal property purchased from an Illinois
8
retailer by a taxpayer engaged in centralized purchasing
9
activities in Illinois who will, upon receipt of the property
10
in Illinois, temporarily store the property in Illinois (i)
11
for the purpose of subsequently transporting it outside this
12
State for use or consumption thereafter solely outside this
13
State or (ii) for the purpose of being processed, fabricated,
14
or manufactured into, attached to, or incorporated into other
15
tangible personal property to be transported outside this
16
State and thereafter used or consumed solely outside this
17
State. The Director of Revenue shall, pursuant to rules
18
adopted in accordance with the Illinois Administrative
19
Procedure Act, issue a permit to any taxpayer in good standing
20
with the Department who is eligible for the exemption under
21
this paragraph (26). The permit issued under this paragraph
22
(26) shall authorize the holder, to the extent and in the
23
manner specified in the rules adopted under this Act, to
24
purchase tangible personal property from a retailer exempt
25
from the taxes imposed by this Act. Taxpayers shall maintain
26
all necessary books and records to substantiate the use and

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consumption of all such tangible personal property outside of
2
the State of Illinois.
3

(27) Beginning January 1, 2008, tangible personal property
4
used in the construction or maintenance of a community water
5
supply, as defined under Section 3.145 of the Environmental
6
Protection Act, that is operated by a not-for-profit
7
corporation that holds a valid water supply permit issued
8
under Title IV of the Environmental Protection Act. This
9
paragraph is exempt from the provisions of Section 3-55.
10

(28) Tangible personal property sold to a
11
public-facilities corporation, as described in Section
12
11-65-10 of the Illinois Municipal Code, for purposes of
13
constructing or furnishing a municipal convention hall, but
14
only if the legal title to the municipal convention hall is
15
transferred to the municipality without any further
16
consideration by or on behalf of the municipality at the time
17
of the completion of the municipal convention hall or upon the
18
retirement or redemption of any bonds or other debt
19
instruments issued by the public-facilities corporation in
20
connection with the development of the municipal convention
21
hall. This exemption includes existing public-facilities
22
corporations as provided in Section 11-65-25 of the Illinois
23
Municipal Code. This paragraph is exempt from the provisions
24
of Section 3-55.
25

(29) Beginning January 1, 2010 and continuing through
26
December 31, 2029, materials, parts, equipment, components,

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

Beginning January 1, 2010 and continuing through December
16
31, 2023, this exemption applies only to the transfer of
17
qualifying tangible personal property incident to the
18
modification, refurbishment, completion, replacement, repair,
19
or maintenance of an aircraft by persons who (i) hold an Air
20
Agency Certificate and are empowered to operate an approved
21
repair station by the Federal Aviation Administration, (ii)
22
have a Class IV Rating, and (iii) conduct operations in
23
accordance with Part 145 of the Federal Aviation Regulations.
24
The exemption does not include aircraft operated by a
25
commercial air carrier providing scheduled passenger air
26
service pursuant to authority issued under Part 121 or Part

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

The changes made to this paragraph (29) by Public Act
15
98-534 are declarative of existing law. It is the intent of the
16
General Assembly that the exemption under this paragraph (29)
17
applies continuously from January 1, 2010 through December 31,
18
2024; however, no claim for credit or refund is allowed for
19
taxes paid as a result of the disallowance of this exemption on
20
or after January 1, 2015 and prior to February 5, 2020 (the
21
effective date of Public Act 101-629).
22

(30) Beginning January 1, 2017 and through December 31,
23
2026, menstrual pads, tampons, and menstrual cups.
24

(31) Tangible personal property transferred to a purchaser
25
who is exempt from tax by operation of federal law. This
26
paragraph is exempt from the provisions of Section 3-55.

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(32) Qualified tangible personal property used in the
2
construction or operation of a data center that has been
3
granted a certificate of exemption by the Department of
4
Commerce and Economic Opportunity, whether that tangible
5
personal property is purchased by the owner, operator, or
6
tenant of the data center or by a contractor or subcontractor
7
of the owner, operator, or tenant. Data centers that would
8
have qualified for a certificate of exemption prior to January
9
1, 2020 had Public Act 101-31 been in effect, may apply for and
10
obtain an exemption for subsequent purchases of computer
11
equipment or enabling software purchased or leased to upgrade,
12
supplement, or replace computer equipment or enabling software
13
purchased or leased in the original investment that would have
14
qualified.
15

The Department of Commerce and Economic Opportunity shall
16
grant a certificate of exemption under this item (32) to
17
qualified data centers as defined by Section 605-1025 of the
18
Department of Commerce and Economic Opportunity Law of the
19
Civil Administrative Code of Illinois.
20

For the purposes of this item (32):
21

"Data center" means a building or a series of
22

buildings rehabilitated or constructed to house working
23

servers in one physical location or multiple sites within
24

the State of Illinois.
25

"Qualified tangible personal property" means:
26

electrical systems and equipment; climate control and

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chilling equipment and systems; mechanical systems and
2

equipment; monitoring and secure systems; emergency
3

generators; hardware; computers; servers; data storage
4

devices; network connectivity equipment; racks; cabinets;
5

telecommunications cabling infrastructure; raised floor
6

systems; peripheral components or systems; software;
7

mechanical, electrical, or plumbing systems; battery
8

systems; cooling systems and towers; temperature control
9

systems; other cabling; and other data center
10

infrastructure equipment and systems necessary to operate
11

qualified tangible personal property, including fixtures;
12

and component parts of any of the foregoing, including
13

installation, maintenance, repair, refurbishment, and
14

replacement of qualified tangible personal property to
15

generate, transform, transmit, distribute, or manage
16

electricity necessary to operate qualified tangible
17

personal property; and all other tangible personal
18

property that is essential to the operations of a computer
19

data center. The term "qualified tangible personal
20

property" also includes building materials physically
21

incorporated into the qualifying data center. To document
22

the exemption allowed under this Section, the retailer
23

must obtain from the purchaser a copy of the certificate
24

of eligibility issued by the Department of Commerce and
25

Economic Opportunity.
26

This item (32) is exempt from the provisions of Section

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3-55.
2

(33) Beginning July 1, 2022, breast pumps, breast pump
3
collection and storage supplies, and breast pump kits. This
4
item (33) is exempt from the provisions of Section 3-55. As
5
used in this item (33):
6

"Breast pump" means an electrically controlled or
7

manually controlled pump device designed or marketed to be
8

used to express milk from a human breast during lactation,
9

including the pump device and any battery, AC adapter, or
10

other power supply unit that is used to power the pump
11

device and is packaged and sold with the pump device at the
12

time of sale.
13

"Breast pump collection and storage supplies" means
14

items of tangible personal property designed or marketed
15

to be used in conjunction with a breast pump to collect
16

milk expressed from a human breast and to store collected
17

milk until it is ready for consumption.
18

"Breast pump collection and storage supplies"
19

includes, but is not limited to: breast shields and breast
20

shield connectors; breast pump tubes and tubing adapters;
21

breast pump valves and membranes; backflow protectors and
22

backflow protector adaptors; bottles and bottle caps
23

specific to the operation of the breast pump; and breast
24

milk storage bags.
25

"Breast pump collection and storage supplies" does not
26

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

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

and other similar carrying accessories, including ice
3

packs, labels, and other similar products; (3) breast pump
4

cleaning supplies; (4) nursing bras, bra pads, breast
5

shells, and other similar products; and (5) creams,
6

ointments, and other similar products that relieve
7

breastfeeding-related symptoms or conditions of the
8

breasts or nipples, unless sold as part of a breast pump
9

kit that is pre-packaged by the breast pump manufacturer
10

or distributor.
11

"Breast pump kit" means a kit that: (1) contains no
12

more than a breast pump, breast pump collection and
13

storage supplies, a rechargeable battery for operating the
14

breast pump, a breastmilk cooler, bottle stands, ice
15

packs, and a breast pump carrying case; and (2) is
16

pre-packaged as a breast pump kit by the breast pump
17

manufacturer or distributor.
18

(34) Tangible personal property sold by or on behalf of
19
the State Treasurer pursuant to the Revised Uniform Unclaimed
20
Property Act. This item (34) is exempt from the provisions of
21
Section 3-55.
22

(35) Beginning on January 1, 2024, tangible personal
23
property purchased by an active duty member of the armed
24
forces of the United States who presents valid military
25
identification and purchases the property using a form of
26
payment where the federal government is the payor. The member

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

(36) Beginning July 1, 2024, home-delivered meals provided
11
to Medicare or Medicaid recipients when payment is made by an
12
intermediary, such as a Medicare Administrative Contractor, a
13
Managed Care Organization, or a Medicare Advantage
14
Organization, pursuant to a government contract. This
15
paragraph
(36)

(35)
is exempt from the provisions of Section
16
3-55.
17

(37)

(36)
Beginning on January 1, 2026, as further defined
18
in Section 3-10, food prepared for immediate consumption and
19
transferred incident to a sale of service subject to this Act
20
or the Service Use Tax Act by an entity licensed under the
21
Hospital Licensing Act, the Nursing Home Care Act, the
22
Assisted Living and Shared Housing Act, the ID/DD Community
23
Care Act, the MC/DD Act, the Specialized Mental Health
24
Rehabilitation Act of 2013, or the Child Care Act of 1969 or by
25
an entity that holds a permit issued pursuant to the Life Care
26
Facilities Act. This item
(37)

(36)
is exempt from the

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provisions of Section 3-55.
2

(38)

(37)
Beginning on January 1, 2026, as further defined
3
in Section 3-10, food for human consumption that is to be
4
consumed off the premises where it is sold (other than
5
alcoholic beverages, food consisting of or infused with adult
6
use cannabis, soft drinks, candy, and food that has been
7
prepared for immediate consumption). This item
(38)

(37)
is
8
exempt from the provisions of Section 3-55.
9

(39)

(36)
The lease of the following tangible personal
10
property:
11

(1) computer software transferred subject to a license
12

that meets the following requirements:
13

(A) it is evidenced by a written agreement signed
14

by the licensor and the customer;
15

(i) an electronic agreement in which the
16

customer accepts the license by means of an
17

electronic signature that is verifiable and can be
18

authenticated and is attached to or made part of
19

the license will comply with this requirement;
20

(ii) a license agreement in which the customer
21

electronically accepts the terms by clicking "I
22

agree" does not comply with this requirement;
23

(B) it restricts the customer's duplication and
24

use of the software;
25

(C) it prohibits the customer from licensing,
26

sublicensing, or transferring the software to a third

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party (except to a related party) without the
2

permission and continued control of the licensor;
3

(D) the licensor has a policy of providing another
4

copy at minimal or no charge if the customer loses or
5

damages the software, or of permitting the licensee to
6

make and keep an archival copy, and such policy is
7

either stated in the license agreement, supported by
8

the licensor's books and records, or supported by a
9

notarized statement made under penalties of perjury by
10

the licensor; and
11

(E) the customer must destroy or return all copies
12

of the software to the licensor at the end of the
13

license period; this provision is deemed to be met, in
14

the case of a perpetual license, without being set
15

forth in the license agreement; and
16

(2) property that is subject to a tax on lease
17

receipts imposed by a home rule unit of local government
18

if the ordinance imposing that tax was adopted prior to
19

January 1, 2023.
20

(40) Beginning on January 1, 2027, tangible personal
21
property purchased for use in the construction or operation of
22
a small modular nuclear reactor in the State. This item is
23
exempt from the provisions of Section 3-55.

24

As used in this item (40):

25

"Small modular nuclear reactor" means a nuclear reactor
26
that:

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(A) has a rated electric generating capacity of not
2

more than 470 megawatts;

3

(B) is capable of being constructed and operated,
4

either:

5

(i) alone; or

6

(ii) in combination with one or more similar
7

reactors at a single site if additional reactors are,
8

or become, necessary; and

9

(C) is required to be licensed by the United States
10

Nuclear Regulatory Commission.

11

"Small modular nuclear reactor" includes, but is not
12
limited to, a nuclear reactor that meets the criteria set
13
forth in this item (40) and that uses a process to produce
14
hydrogen that can be used for energy storage, as a fuel, or for
15
other uses.

16
(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
17
Section 70-15, eff. 4-19-22; 102-700, Article 75, Section
18
75-15, eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
19
Section 5-15, eff. 6-7-23; 103-9, Article 15, Section 15-15,
20
eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
21
103-592, eff. 1-1-25; 103-605, eff. 7-1-24; 103-643, eff.
22
7-1-24; 103-746, eff. 1-1-25; 103-781, eff. 8-5-24; 103-995,
23
eff. 8-9-24; revised 11-26-24.)

24

Section 25.
The Retailers' Occupation Tax Act is amended
25
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

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licensed, if the selling price of the tender is separately
2

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
6

not limited to, tractors, harvesters, sprayers, planters,
7

seeders, or spreaders. Precision farming equipment
8

includes, but is not limited to, soil testing sensors,
9

computers, monitors, software, global positioning and
10

mapping systems, and other such equipment.
11

Farm machinery and equipment also includes computers,
12

sensors, software, and related equipment used primarily in
13

the computer-assisted operation of production agriculture
14

facilities, equipment, and activities such as, but not
15

limited to, the collection, monitoring, and correlation of
16

animal and crop data for the purpose of formulating animal
17

diets and agricultural chemicals.
18

Beginning on January 1, 2024, farm machinery and
19

equipment also includes electrical power generation
20

equipment used primarily for production agriculture.
21

This item (2) is exempt from the provisions of Section
22

2-70.
23

(3) Until July 1, 2003, distillation machinery and
24

equipment, sold as a unit or kit, assembled or installed
25

by the retailer, certified by the user to be used only for
26

the production of ethyl alcohol that will be used for

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consumption as motor fuel or as a component of motor fuel
2

for the personal use of the user, and not subject to sale
3

or resale.
4

(4) Until July 1, 2003 and beginning again September
5

1, 2004 through August 30, 2014, graphic arts machinery
6

and equipment, including repair and replacement parts,
7

both new and used, and including that manufactured on
8

special order or purchased for lease, certified by the
9

purchaser to be used primarily for graphic arts
10

production. 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
13

upon a graphic arts product. Beginning on July 1, 2017,
14

graphic arts machinery and equipment is included in the
15

manufacturing and assembling machinery and equipment
16

exemption under paragraph (14).
17

(5) A motor vehicle that is used for automobile
18

renting, as defined in the Automobile Renting Occupation
19

and Use Tax Act. This paragraph is exempt from the
20

provisions of Section 2-70.
21

(6) Personal property sold by a teacher-sponsored
22

student organization affiliated with an elementary or
23

secondary school located in Illinois.
24

(7) Until July 1, 2003, proceeds of that portion of
25

the selling price of a passenger car the sale of which is
26

subject to the Replacement Vehicle Tax.

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(8) Personal property sold to an Illinois county fair
2

association for use in conducting, operating, or promoting
3

the county fair.
4

(9) Personal property sold to a not-for-profit arts or
5

cultural organization that establishes, by proof required
6

by the Department by rule, that it has received an
7

exemption under Section 501(c)(3) of the Internal Revenue
8

Code and that is organized and operated primarily for the
9

presentation or support of arts or cultural programming,
10

activities, or services. These organizations include, but
11

are not limited to, music and dramatic arts organizations
12

such as symphony orchestras and theatrical groups, arts
13

and cultural service organizations, local arts councils,
14

visual arts organizations, and media arts organizations.
15

On and after July 1, 2001 (the effective date of Public Act
16

92-35), however, an entity otherwise eligible for this
17

exemption shall not make tax-free purchases unless it has
18

an active identification number issued by the Department.
19

(10) Personal property sold by a corporation, society,
20

association, foundation, institution, or organization,
21

other than a limited liability company, that is organized
22

and operated as a not-for-profit service enterprise for
23

the benefit of persons 65 years of age or older if the
24

personal property was not purchased by the enterprise for
25

the purpose of resale by the enterprise.
26

(11) Except as otherwise provided in this Section,

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personal property sold to a governmental body, to a
2

corporation, society, association, foundation, or
3

institution organized and operated exclusively for
4

charitable, religious, or educational purposes, or to a
5

not-for-profit corporation, society, association,
6

foundation, institution, or organization that has no
7

compensated officers or employees and that is organized
8

and operated primarily for the recreation of persons 55
9

years of age or older. A limited liability company may
10

qualify for the exemption under this paragraph only if the
11

limited liability company is organized and operated
12

exclusively for educational purposes. On and after July 1,
13

1987, however, no entity otherwise eligible for this
14

exemption shall make tax-free purchases unless it has an
15

active identification number issued by the Department.
16

(12) (Blank).
17

(12-5) On and after July 1, 2003 and through June 30,
18

2004, motor vehicles of the second division with a gross
19

vehicle weight in excess of 8,000 pounds that are subject
20

to the commercial distribution fee imposed under Section
21

3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
22

2004 and through June 30, 2005, the use in this State of
23

motor vehicles of the second division: (i) with a gross
24

vehicle weight rating in excess of 8,000 pounds; (ii) that
25

are subject to the commercial distribution fee imposed
26

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

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(iii) that are primarily used for commercial purposes.
2

Through June 30, 2005, this exemption applies to repair
3

and replacement parts added after the initial purchase of
4

such a motor vehicle if that motor vehicle is used in a
5

manner that would qualify for the rolling stock exemption
6

otherwise provided for in this Act. For purposes of this
7

paragraph, "used for commercial purposes" means the
8

transportation of persons or property in furtherance of
9

any commercial or industrial enterprise whether for-hire
10

or not.
11

(13) Proceeds from sales to owners or lessors,
12

lessees, or shippers of tangible personal property that is
13

utilized by interstate carriers for hire for use as
14

rolling stock moving in interstate commerce and equipment
15

operated by a telecommunications provider, licensed as a
16

common carrier by the Federal Communications Commission,
17

which is permanently installed in or affixed to aircraft
18

moving in interstate commerce.
19

(14) Machinery and equipment that will be used by the
20

purchaser, or a lessee of the purchaser, primarily in the
21

process of manufacturing or assembling tangible personal
22

property for wholesale or retail sale or lease, whether
23

the sale or lease is made directly by the manufacturer or
24

by some other person, whether the materials used in the
25

process are owned by the manufacturer or some other
26

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

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as an incident to the seller's engaging in the service
2

occupation of producing machines, tools, dies, jigs,
3

patterns, gauges, or other similar items of no commercial
4

value on special order for a particular purchaser. The
5

exemption provided by this paragraph (14) does not include
6

machinery and equipment used in (i) the generation of
7

electricity for wholesale or retail sale; (ii) the
8

generation or treatment of natural or artificial gas for
9

wholesale or retail sale that is delivered to customers
10

through pipes, pipelines, or mains; or (iii) the treatment
11

of water for wholesale or retail sale that is delivered to
12

customers through pipes, pipelines, or mains. The
13

provisions of Public Act 98-583 are declaratory of
14

existing law as to the meaning and scope of this
15

exemption. Beginning on July 1, 2017, the exemption
16

provided by this paragraph (14) includes, but is not
17

limited to, graphic arts machinery and equipment, as
18

defined in paragraph (4) of this Section.
19

(15) Proceeds of mandatory service charges separately
20

stated on customers' bills for purchase and consumption of
21

food and beverages, to the extent that the proceeds of the
22

service charge are in fact turned over as tips or as a
23

substitute for tips to the employees who participate
24

directly in preparing, serving, hosting or cleaning up the
25

food or beverage function with respect to which the
26

service charge is imposed.

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(16) Tangible personal property sold to a purchaser if
2

the purchaser is exempt from use tax by operation of
3

federal law. This paragraph is exempt from the provisions
4

of Section 2-70.
5

(17) Tangible personal property sold to a common
6

carrier by rail or motor that receives the physical
7

possession of the property in Illinois and that transports
8

the property, or shares with another common carrier in the
9

transportation of the property, out of Illinois on a
10

standard uniform bill of lading showing the seller of the
11

property as the shipper or consignor of the property to a
12

destination outside Illinois, for use outside Illinois.
13

(18) Legal tender, currency, medallions, or gold or
14

silver coinage issued by the State of Illinois, the
15

government of the United States of America, or the
16

government of any foreign country, and bullion.
17

(19) Until July 1, 2003, oil field exploration,
18

drilling, and production equipment, including (i) rigs and
19

parts of rigs, rotary rigs, cable tool rigs, and workover
20

rigs, (ii) pipe and tubular goods, including casing and
21

drill strings, (iii) pumps and pump-jack units, (iv)
22

storage tanks and flow lines, (v) any individual
23

replacement part for oil field exploration, drilling, and
24

production equipment, and (vi) machinery and equipment
25

purchased for lease; but excluding motor vehicles required
26

to be registered under the Illinois Vehicle Code.

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(20) Photoprocessing machinery and equipment,
2

including repair and replacement parts, both new and used,
3

including that manufactured on special order, certified by
4

the purchaser to be used primarily for photoprocessing,
5

and including photoprocessing machinery and equipment
6

purchased for lease.
7

(21) Until July 1, 2028, coal and aggregate
8

exploration, mining, off-highway hauling, processing,
9

maintenance, and reclamation equipment, including
10

replacement parts and equipment, and including equipment
11

purchased for lease, but excluding motor vehicles required
12

to be registered under the Illinois Vehicle Code. The
13

changes made to this Section by Public Act 97-767 apply on
14

and after July 1, 2003, but no claim for credit or refund
15

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

of Public Act 98-456) for such taxes paid during the
17

period beginning July 1, 2003 and ending on August 16,
18

2013 (the effective date of Public Act 98-456).
19

(22) Until June 30, 2013, fuel and petroleum products
20

sold to or used by an air carrier, certified by the carrier
21

to be used for consumption, shipment, or storage in the
22

conduct of its business as an air common carrier, for a
23

flight destined for or returning from a location or
24

locations outside the United States without regard to
25

previous or subsequent domestic stopovers.
26

Beginning July 1, 2013, fuel and petroleum products

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sold to or used by an air carrier, certified by the carrier
2

to be used for consumption, shipment, or storage in the
3

conduct of its business as an air common carrier, for a
4

flight that (i) is engaged in foreign trade or is engaged
5

in trade between the United States and any of its
6

possessions and (ii) transports at least one individual or
7

package for hire from the city of origination to the city
8

of final destination on the same aircraft, without regard
9

to a change in the flight number of that aircraft.
10

(23) A transaction in which the purchase order is
11

received by a florist who is located outside Illinois, but
12

who has a florist located in Illinois deliver the property
13

to the purchaser or the purchaser's donee in Illinois.
14

(24) Fuel consumed or used in the operation of ships,
15

barges, or vessels that are used primarily in or for the
16

transportation of property or the conveyance of persons
17

for hire on rivers bordering on this State if the fuel is
18

delivered by the seller to the purchaser's barge, ship, or
19

vessel while it is afloat upon that bordering river.
20

(25) Except as provided in item (25-5) of this
21

Section, a motor vehicle sold in this State to a
22

nonresident even though the motor vehicle is delivered to
23

the nonresident in this State, if the motor vehicle is not
24

to be titled in this State, and if a drive-away permit is
25

issued to the motor vehicle as provided in Section 3-603
26

of the Illinois Vehicle Code or if the nonresident

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purchaser has vehicle registration plates to transfer to
2

the motor vehicle upon returning to his or her home state.
3

The issuance of the drive-away permit or having the
4

out-of-state registration plates to be transferred is
5

prima facie evidence that the motor vehicle will not be
6

titled in this State.
7

(25-5) The exemption under item (25) does not apply if
8

the state in which the motor vehicle will be titled does
9

not allow a reciprocal exemption for a motor vehicle sold
10

and delivered in that state to an Illinois resident but
11

titled in Illinois. The tax collected under this Act on
12

the sale of a motor vehicle in this State to a resident of
13

another state that does not allow a reciprocal exemption
14

shall be imposed at a rate equal to the state's rate of tax
15

on taxable property in the state in which the purchaser is
16

a resident, except that the tax shall not exceed the tax
17

that would otherwise be imposed under this Act. At the
18

time of the sale, the purchaser shall execute a statement,
19

signed under penalty of perjury, of his or her intent to
20

title the vehicle in the state in which the purchaser is a
21

resident within 30 days after the sale and of the fact of
22

the payment to the State of Illinois of tax in an amount
23

equivalent to the state's rate of tax on taxable property
24

in his or her state of residence and shall submit the
25

statement to the appropriate tax collection agency in his
26

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

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retain a signed copy of the statement in his or her
2

records. Nothing in this item shall be construed to
3

require the removal of the vehicle from this state
4

following the filing of an intent to title the vehicle in
5

the purchaser's state of residence if the purchaser titles
6

the vehicle in his or her state of residence within 30 days
7

after the date of sale. The tax collected under this Act in
8

accordance with this item (25-5) shall be proportionately
9

distributed as if the tax were collected at the 6.25%
10

general rate imposed under this Act.
11

(25-7) Beginning on July 1, 2007, no tax is imposed
12

under this Act on the sale of an aircraft, as defined in
13

Section 3 of the Illinois Aeronautics Act, if all of the
14

following conditions are met:
15

(1) the aircraft leaves this State within 15 days
16

after the later of either the issuance of the final
17

billing for the sale of the aircraft, or the
18

authorized approval for return to service, completion
19

of the maintenance record entry, and completion of the
20

test flight and ground test for inspection, as
21

required by 14 CFR 91.407;
22

(2) the aircraft is not based or registered in
23

this State after the sale of the aircraft; and
24

(3) the seller retains in his or her books and
25

records and provides to the Department a signed and
26

dated certification from the purchaser, on a form

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prescribed by the Department, certifying that the
2

requirements of this item (25-7) are met. The
3

certificate must also include the name and address of
4

the purchaser, the address of the location where the
5

aircraft is to be titled or registered, the address of
6

the primary physical location of the aircraft, and
7

other information that the Department may reasonably
8

require.
9

For purposes of this item (25-7):
10

"Based in this State" means hangared, stored, or
11

otherwise used, excluding post-sale customizations as
12

defined in this Section, for 10 or more days in each
13

12-month period immediately following the date of the sale
14

of the aircraft.
15

"Registered in this State" means an aircraft
16

registered with the Department of Transportation,
17

Aeronautics Division, or titled or registered with the
18

Federal Aviation Administration to an address located in
19

this State.
20

This paragraph (25-7) is exempt from the provisions of
21

Section 2-70.
22

(26) Semen used for artificial insemination of
23

livestock for direct agricultural production.
24

(27) Horses, or interests in horses, registered with
25

and meeting the requirements of any of the Arabian Horse
26

Club Registry of America, Appaloosa Horse Club, American

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Quarter Horse Association, United States Trotting
2

Association, or Jockey Club, as appropriate, used for
3

purposes of breeding or racing for prizes. This item (27)
4

is exempt from the provisions of Section 2-70, and the
5

exemption provided for under this item (27) applies for
6

all periods beginning May 30, 1995, but no claim for
7

credit or refund is allowed on or after January 1, 2008
8

(the effective date of Public Act 95-88) for such taxes
9

paid during the period beginning May 30, 2000 and ending
10

on January 1, 2008 (the effective date of Public Act
11

95-88).
12

(28) Computers and communications equipment utilized
13

for any hospital purpose and equipment used in the
14

diagnosis, analysis, or treatment of hospital patients
15

sold to a lessor who leases the equipment, under a lease of
16

one year or longer executed or in effect at the time of the
17

purchase, to a hospital that has been issued an active tax
18

exemption identification number by the Department under
19

Section 1g of this Act.
20

(29) Personal property sold to a lessor who leases the
21

property, under a lease of one year or longer executed or
22

in effect at the time of the purchase, to a governmental
23

body that has been issued an active tax exemption
24

identification number by the Department under Section 1g
25

of this Act.
26

(30) Beginning with taxable years ending on or after

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December 31, 1995 and ending with taxable years ending on
2

or before December 31, 2004, personal property that is
3

donated for disaster relief to be used in a State or
4

federally declared disaster area in Illinois or bordering
5

Illinois by a manufacturer or retailer that is registered
6

in this State to a corporation, society, association,
7

foundation, or institution that has been issued a sales
8

tax exemption identification number by the Department that
9

assists victims of the disaster who reside within the
10

declared disaster area.
11

(31) Beginning with taxable years ending on or after
12

December 31, 1995 and ending with taxable years ending on
13

or before December 31, 2004, personal property that is
14

used in the performance of infrastructure repairs in this
15

State, including, but not limited to, municipal roads and
16

streets, access roads, bridges, sidewalks, waste disposal
17

systems, water and sewer line extensions, water
18

distribution and purification facilities, storm water
19

drainage and retention facilities, and sewage treatment
20

facilities, resulting from a State or federally declared
21

disaster in Illinois or bordering Illinois when such
22

repairs are initiated on facilities located in the
23

declared disaster area within 6 months after the disaster.
24

(32) Beginning July 1, 1999, game or game birds sold
25

at a "game breeding and hunting preserve area" as that
26

term is used in the Wildlife Code. This paragraph is

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exempt from the provisions of Section 2-70.
2

(33) A motor vehicle, as that term is defined in
3

Section 1-146 of the Illinois Vehicle Code, that is
4

donated to a corporation, limited liability company,
5

society, association, foundation, or institution that is
6

determined by the Department to be organized and operated
7

exclusively for educational purposes. For purposes of this
8

exemption, "a corporation, limited liability company,
9

society, association, foundation, or institution organized
10

and operated exclusively for educational purposes" means
11

all tax-supported public schools, private schools that
12

offer systematic instruction in useful branches of
13

learning by methods common to public schools and that
14

compare favorably in their scope and intensity with the
15

course of study presented in tax-supported schools, and
16

vocational or technical schools or institutes organized
17

and operated exclusively to provide a course of study of
18

not less than 6 weeks duration and designed to prepare
19

individuals to follow a trade or to pursue a manual,
20

technical, mechanical, industrial, business, or commercial
21

occupation.
22

(34) Beginning January 1, 2000, personal property,
23

including food, purchased through fundraising events for
24

the benefit of a public or private elementary or secondary
25

school, a group of those schools, or one or more school
26

districts if the events are sponsored by an entity

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recognized by the school district that consists primarily
2

of volunteers and includes parents and teachers of the
3

school children. This paragraph does not apply to
4

fundraising events (i) for the benefit of private home
5

instruction or (ii) for which the fundraising entity
6

purchases the personal property sold at the events from
7

another individual or entity that sold the property for
8

the purpose of resale by the fundraising entity and that
9

profits from the sale to the fundraising entity. This
10

paragraph is exempt from the provisions of Section 2-70.
11

(35) Beginning January 1, 2000 and through December
12

31, 2001, new or used automatic vending machines that
13

prepare and serve hot food and beverages, including
14

coffee, soup, and other items, and replacement parts for
15

these machines. Beginning January 1, 2002 and through June
16

30, 2003, machines and parts for machines used in
17

commercial, coin-operated amusement and vending business
18

if a use or occupation tax is paid on the gross receipts
19

derived from the use of the commercial, coin-operated
20

amusement and vending machines. This paragraph is exempt
21

from the provisions of Section 2-70.
22

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

2016, food for human consumption that is to be consumed
24

off the premises where it is sold (other than alcoholic
25

beverages, soft drinks, and food that has been prepared
26

for immediate consumption) and prescription and

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nonprescription medicines, drugs, medical appliances, and
2

insulin, urine testing materials, syringes, and needles
3

used by diabetics, for human use, when purchased for use
4

by a person receiving medical assistance under Article V
5

of the Illinois Public Aid Code who resides in a licensed
6

long-term care facility, as defined in the Nursing Home
7

Care Act, or a licensed facility as defined in the ID/DD
8

Community Care Act, the MC/DD Act, or the Specialized
9

Mental Health Rehabilitation Act of 2013.
10

(36) Beginning August 2, 2001, computers and
11

communications equipment utilized for any hospital purpose
12

and equipment used in the diagnosis, analysis, or
13

treatment of hospital patients sold to a lessor who leases
14

the equipment, under a lease of one year or longer
15

executed or in effect at the time of the purchase, to a
16

hospital that has been issued an active tax exemption
17

identification number by the Department under Section 1g
18

of this Act. This paragraph is exempt from the provisions
19

of Section 2-70.
20

(37) Beginning August 2, 2001, personal property sold
21

to a lessor who leases the property, under a lease of one
22

year or longer executed or in effect at the time of the
23

purchase, to a governmental body that has been issued an
24

active tax exemption identification number by the
25

Department under Section 1g of this Act. This paragraph is
26

exempt from the provisions of Section 2-70.

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(38) Beginning on January 1, 2002 and through June 30,
2

2016, tangible personal property purchased from an
3

Illinois retailer by a taxpayer engaged in centralized
4

purchasing activities in Illinois who will, upon receipt
5

of the property in Illinois, temporarily store the
6

property in Illinois (i) for the purpose of subsequently
7

transporting it outside this State for use or consumption
8

thereafter solely outside this State or (ii) for the
9

purpose of being processed, fabricated, or manufactured
10

into, attached to, or incorporated into other tangible
11

personal property to be transported outside this State and
12

thereafter used or consumed solely outside this State. The
13

Director of Revenue shall, pursuant to rules adopted in
14

accordance with the Illinois Administrative Procedure Act,
15

issue a permit to any taxpayer in good standing with the
16

Department who is eligible for the exemption under this
17

paragraph (38). The permit issued under this paragraph
18

(38) shall authorize the holder, to the extent and in the
19

manner specified in the rules adopted under this Act, to
20

purchase tangible personal property from a retailer exempt
21

from the taxes imposed by this Act. Taxpayers shall
22

maintain all necessary books and records to substantiate
23

the use and consumption of all such tangible personal
24

property outside of the State of Illinois.
25

(39) Beginning January 1, 2008, tangible personal
26

property used in the construction or maintenance of a

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community water supply, as defined under Section 3.145 of
2

the Environmental Protection Act, that is operated by a
3

not-for-profit corporation that holds a valid water supply
4

permit issued under Title IV of the Environmental
5

Protection Act. This paragraph is exempt from the
6

provisions of Section 2-70.
7

(40) Beginning January 1, 2010 and continuing through
8

December 31, 2029, materials, parts, equipment,
9

components, and furnishings incorporated into or upon an
10

aircraft as part of the modification, refurbishment,
11

completion, replacement, repair, or maintenance of the
12

aircraft. This exemption includes consumable supplies used
13

in the modification, refurbishment, completion,
14

replacement, repair, and maintenance of aircraft. However,
15

until January 1, 2024, this exemption excludes any
16

materials, parts, equipment, components, and consumable
17

supplies used in the modification, replacement, repair,
18

and maintenance of aircraft engines or power plants,
19

whether such engines or power plants are installed or
20

uninstalled upon any such aircraft. "Consumable supplies"
21

include, but are not limited to, adhesive, tape,
22

sandpaper, general purpose lubricants, cleaning solution,
23

latex gloves, and protective films.
24

Beginning January 1, 2010 and continuing through
25

December 31, 2023, this exemption applies only to the sale
26

of qualifying tangible personal property to persons who

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1

modify, refurbish, complete, replace, or maintain an
2

aircraft and who (i) hold an Air Agency Certificate and
3

are empowered to operate an approved repair station by the
4

Federal Aviation Administration, (ii) have a Class IV
5

Rating, and (iii) conduct operations in accordance with
6

Part 145 of the Federal Aviation Regulations. The
7

exemption does not include aircraft operated by a
8

commercial air carrier providing scheduled passenger air
9

service pursuant to authority issued under Part 121 or
10

Part 129 of the Federal Aviation Regulations. From January
11

1, 2024 through December 31, 2029, this exemption applies
12

only to the sale of qualifying tangible personal property
13

to: (A) persons who modify, refurbish, complete, repair,
14

replace, or maintain aircraft and who (i) hold an Air
15

Agency Certificate and are empowered to operate an
16

approved repair station by the Federal Aviation
17

Administration, (ii) have a Class IV Rating, and (iii)
18

conduct operations in accordance with Part 145 of the
19

Federal Aviation Regulations; and (B) persons who engage
20

in the modification, replacement, repair, and maintenance
21

of aircraft engines or power plants without regard to
22

whether or not those persons meet the qualifications of
23

item (A).
24

The changes made to this paragraph (40) by Public Act
25

98-534 are declarative of existing law. It is the intent
26

of the General Assembly that the exemption under this

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paragraph (40) applies continuously from January 1, 2010
2

through December 31, 2024; however, no claim for credit or
3

refund is allowed for taxes paid as a result of the
4

disallowance of this exemption on or after January 1, 2015
5

and prior to February 5, 2020 (the effective date of
6

Public Act 101-629).
7

(41) Tangible personal property sold to a
8

public-facilities corporation, as described in Section
9

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

constructing or furnishing a municipal convention hall,
11

but only if the legal title to the municipal convention
12

hall is transferred to the municipality without any
13

further consideration by or on behalf of the municipality
14

at the time of the completion of the municipal convention
15

hall or upon the retirement or redemption of any bonds or
16

other debt instruments issued by the public-facilities
17

corporation in connection with the development of the
18

municipal convention hall. This exemption includes
19

existing public-facilities corporations as provided in
20

Section 11-65-25 of the Illinois Municipal Code. This
21

paragraph is exempt from the provisions of Section 2-70.
22

(42) Beginning January 1, 2017 and through December
23

31, 2026, menstrual pads, tampons, and menstrual cups.
24

(43) Merchandise that is subject to the Rental
25

Purchase Agreement Occupation and Use Tax. The purchaser
26

must certify that the item is purchased to be rented

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subject to a rental-purchase agreement, as defined in the
2

Rental-Purchase Agreement Act, and provide proof of
3

registration under the Rental Purchase Agreement
4

Occupation and Use Tax Act. This paragraph is exempt from
5

the provisions of Section 2-70.
6

(44) Qualified tangible personal property used in the
7

construction or operation of a data center that has been
8

granted a certificate of exemption by the Department of
9

Commerce and Economic Opportunity, whether that tangible
10

personal property is purchased by the owner, operator, or
11

tenant of the data center or by a contractor or
12

subcontractor of the owner, operator, or tenant. Data
13

centers that would have qualified for a certificate of
14

exemption prior to January 1, 2020 had Public Act 101-31
15

been in effect, may apply for and obtain an exemption for
16

subsequent purchases of computer equipment or enabling
17

software purchased or leased to upgrade, supplement, or
18

replace computer equipment or enabling software purchased
19

or leased in the original investment that would have
20

qualified.
21

The Department of Commerce and Economic Opportunity
22

shall grant a certificate of exemption under this item
23

(44) to qualified data centers as defined by Section
24

605-1025 of the Department of Commerce and Economic
25

Opportunity Law of the Civil Administrative Code of
26

Illinois.

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For the purposes of this item (44):
2

"Data center" means a building or a series of
3

buildings rehabilitated or constructed to house
4

working servers in one physical location or multiple
5

sites within the State of Illinois.
6

"Qualified tangible personal property" means:
7

electrical systems and equipment; climate control and
8

chilling equipment and systems; mechanical systems and
9

equipment; monitoring and secure systems; emergency
10

generators; hardware; computers; servers; data storage
11

devices; network connectivity equipment; racks;
12

cabinets; telecommunications cabling infrastructure;
13

raised floor systems; peripheral components or
14

systems; software; mechanical, electrical, or plumbing
15

systems; battery systems; cooling systems and towers;
16

temperature control systems; other cabling; and other
17

data center infrastructure equipment and systems
18

necessary to operate qualified tangible personal
19

property, including fixtures; and component parts of
20

any of the foregoing, including installation,
21

maintenance, repair, refurbishment, and replacement of
22

qualified tangible personal property to generate,
23

transform, transmit, distribute, or manage electricity
24

necessary to operate qualified tangible personal
25

property; and all other tangible personal property
26

that is essential to the operations of a computer data

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1

center. The term "qualified tangible personal
2

property" also includes building materials physically
3

incorporated into the qualifying data center. To
4

document the exemption allowed under this Section, the
5

retailer must obtain from the purchaser a copy of the
6

certificate of eligibility issued by the Department of
7

Commerce and Economic Opportunity.
8

This item (44) is exempt from the provisions of
9

Section 2-70.
10

(45) Beginning January 1, 2020 and through December
11

31, 2020, sales of tangible personal property made by a
12

marketplace seller over a marketplace for which tax is due
13

under this Act but for which use tax has been collected and
14

remitted to the Department by a marketplace facilitator
15

under Section 2d of the Use Tax Act are exempt from tax
16

under this Act. A marketplace seller claiming this
17

exemption shall maintain books and records demonstrating
18

that the use tax on such sales has been collected and
19

remitted by a marketplace facilitator. Marketplace sellers
20

that have properly remitted tax under this Act on such
21

sales may file a claim for credit as provided in Section 6
22

of this Act. No claim is allowed, however, for such taxes
23

for which a credit or refund has been issued to the
24

marketplace facilitator under the Use Tax Act, or for
25

which the marketplace facilitator has filed a claim for
26

credit or refund under the Use Tax Act.

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(46) Beginning July 1, 2022, breast pumps, breast pump
2

collection and storage supplies, and breast pump kits.
3

This item (46) is exempt from the provisions of Section
4

2-70. As used in this item (46):
5

"Breast pump" means an electrically controlled or
6

manually controlled pump device designed or marketed to be
7

used to express milk from a human breast during lactation,
8

including the pump device and any battery, AC adapter, or
9

other power supply unit that is used to power the pump
10

device and is packaged and sold with the pump device at the
11

time of sale.
12

"Breast pump collection and storage supplies" means
13

items of tangible personal property designed or marketed
14

to be used in conjunction with a breast pump to collect
15

milk expressed from a human breast and to store collected
16

milk until it is ready for consumption.
17

"Breast pump collection and storage supplies"
18

includes, but is not limited to: breast shields and breast
19

shield connectors; breast pump tubes and tubing adapters;
20

breast pump valves and membranes; backflow protectors and
21

backflow protector adaptors; bottles and bottle caps
22

specific to the operation of the breast pump; and breast
23

milk storage bags.
24

"Breast pump collection and storage supplies" does not
25

include: (1) bottles and bottle caps not specific to the
26

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

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and other similar carrying accessories, including ice
2

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

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

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

ointments, and other similar products that relieve
6

breastfeeding-related symptoms or conditions of the
7

breasts or nipples, unless sold as part of a breast pump
8

kit that is pre-packaged by the breast pump manufacturer
9

or distributor.
10

"Breast pump kit" means a kit that: (1) contains no
11

more than a breast pump, breast pump collection and
12

storage supplies, a rechargeable battery for operating the
13

breast pump, a breastmilk cooler, bottle stands, ice
14

packs, and a breast pump carrying case; and (2) is
15

pre-packaged as a breast pump kit by the breast pump
16

manufacturer or distributor.
17

(47) Tangible personal property sold by or on behalf
18

of the State Treasurer pursuant to the Revised Uniform
19

Unclaimed Property Act. This item (47) is exempt from the
20

provisions of Section 2-70.
21

(48) Beginning on January 1, 2024, tangible personal
22

property purchased by an active duty member of the armed
23

forces of the United States who presents valid military
24

identification and purchases the property using a form of
25

payment where the federal government is the payor. The
26

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

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1

sale, a form prescribed by the Department of Revenue
2

documenting that the transaction is eligible for the
3

exemption under this paragraph. Retailers must keep the
4

form as documentation of the exemption in their records
5

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

United States" means the United States Army, Navy, Air
7

Force, Space Force, Marine Corps, or Coast Guard. This
8

paragraph is exempt from the provisions of Section 2-70.
9

(49) Beginning July 1, 2024, home-delivered meals
10

provided to Medicare or Medicaid recipients when payment
11

is made by an intermediary, such as a Medicare
12

Administrative Contractor, a Managed Care Organization, or
13

a Medicare Advantage Organization, pursuant to a
14

government contract. This paragraph (49) is exempt from
15

the provisions of Section 2-70.
16

(50)

(49)
Beginning on January 1, 2026, as further
17

defined in Section 2-10, food for human consumption that
18

is to be consumed off the premises where it is sold (other
19

than alcoholic beverages, food consisting of or infused
20

with adult use cannabis, soft drinks, candy, and food that
21

has been prepared for immediate consumption). This item
22

(50)

(49)
is exempt from the provisions of Section 2-70.
23

(51)

(49)
Gross receipts from the lease of the
24

following tangible personal property:
25

(1) computer software transferred subject to a
26

license that meets the following requirements:

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(A) it is evidenced by a written agreement
2

signed by the licensor and the customer;
3

(i) an electronic agreement in which the
4

customer accepts the license by means of an
5

electronic signature that is verifiable and
6

can be authenticated and is attached to or
7

made part of the license will comply with this
8

requirement;
9

(ii) a license agreement in which the
10

customer electronically accepts the terms by
11

clicking "I agree" does not comply with this
12

requirement;
13

(B) it restricts the customer's duplication
14

and use of the software;
15

(C) it prohibits the customer from licensing,
16

sublicensing, or transferring the software to a
17

third party (except to a related party) without
18

the permission and continued control of the
19

licensor;
20

(D) the licensor has a policy of providing
21

another copy at minimal or no charge if the
22

customer loses or damages the software, or of
23

permitting the licensee to make and keep an
24

archival copy, and such policy is either stated in
25

the license agreement, supported by the licensor's
26

books and records, or supported by a notarized

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1

statement made under penalties of perjury by the
2

licensor; and
3

(E) the customer must destroy or return all
4

copies of the software to the licensor at the end
5

of the license period; this provision is deemed to
6

be met, in the case of a perpetual license,
7

without being set forth in the license agreement;
8

and
9

(2) property that is subject to a tax on lease
10

receipts imposed by a home rule unit of local
11

government if the ordinance imposing that tax was
12

adopted prior to January 1, 2023.
13

(52) Beginning on January 1, 2027, tangible personal
14

property purchased for use in the construction or
15

operation of a small modular nuclear reactor in the State.
16

This item is exempt from the provisions of Section 2-70.

17

As used in this item (52):

18

"Small modular nuclear reactor" means a nuclear
19

reactor that:

20

(A) has a rated electric generating capacity of
21

not more than 470 megawatts;

22

(B) is capable of being constructed and operated,
23

either:

24

(i) alone; or

25

(ii) in combination with one or more similar
26

reactors at a single site if additional reactors

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1

are, or become, necessary; and

2

(C) is required to be licensed by the United
3

States Nuclear Regulatory Commission.

4

"Small modular nuclear reactor" includes, but is not
5

limited to, a nuclear reactor that meets the criteria set
6

forth in this item (52) and that uses a process to produce
7

hydrogen that can be used for energy storage, as a fuel, or
8

for other uses.

9
(Source: P.A. 102-16, eff. 6-17-21; 102-634, eff. 8-27-21;
10
102-700, Article 70, Section 70-20, eff. 4-19-22; 102-700,
11
Article 75, Section 75-20, eff. 4-19-22; 102-813, eff.
12
5-13-22; 102-1026, eff. 5-27-22; 103-9, Article 5, Section
13
5-20, eff. 6-7-23; 103-9, Article 15, Section 15-20, eff.
14
6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24; 103-592,
15
eff. 1-1-25; 103-605, eff. 7-1-24; 103-643, eff. 7-1-24;
16
103-746, eff. 1-1-25; 103-781, eff. 8-5-24; 103-995, eff.
17
8-9-24; revised 11-26-24.)

18

Section 99.
Effective date.
This Act takes effect upon
19
becoming law.

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