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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3944

Introduced 2/6/2026, by Sen. Donald P. DeWitte

SYNOPSIS AS INTRODUCED:

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

Amends the Use Tax Act, the Service Use Tax Act, the Service
Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that,
beginning on January 1, 2027, tangible personal property that is purchased
for the improvement of residential or nonresidential real estate by the
installation of a solar energy system that is primarily used to provide
electricity to the premises is exempt from taxation under the Acts.
LRB104 19255 HLH 32701 b

A BILL FOR

SB3944
LRB104 19255 HLH 32701 b
1

AN ACT concerning revenue.

2

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

4

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

6

(35 ILCS 105/3-5)
7

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

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

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

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

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

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

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

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

(7) Farm chemicals.
18

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

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

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

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LRB104 19255 HLH 32701 b
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Act.
2

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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1

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

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

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

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

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

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

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LRB104 19255 HLH 32701 b
1
drugs, medical appliances, and insulin, urine testing
2
materials, syringes, and needles used by diabetics, for human
3
use, when purchased for use by a person receiving medical
4
assistance under Article V of the Illinois Public Aid Code who
5
resides in a licensed long-term care facility, as defined in
6
the Nursing Home Care Act, or in a licensed facility as defined
7
in the ID/DD Community Care Act, the MC/DD Act, or the
8
Specialized Mental Health Rehabilitation Act of 2013.
9

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

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LRB104 19255 HLH 32701 b
1
tax has not been paid by the lessor. If a lessor improperly
2
collects any such amount from the lessee, the lessee shall
3
have a legal right to claim a refund of that amount from the
4
lessor. If, however, that amount is not refunded to the lessee
5
for any reason, the lessor is liable to pay that amount to the
6
Department. This paragraph is exempt from the provisions of
7
Section 3-90.
8

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

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LRB104 19255 HLH 32701 b
1
lessor. If, however, that amount is not refunded to the lessee
2
for any reason, the lessor is liable to pay that amount to the
3
Department. This paragraph is exempt from the provisions of
4
Section 3-90.
5

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

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

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

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

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

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

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

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

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

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

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

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

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

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

For the purposes of this item (40):
23

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

buildings rehabilitated or constructed to house working
25

servers in one physical location or multiple sites within
26

the State of Illinois.

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"Qualified tangible personal property" means:
2

electrical systems and equipment; climate control and
3

chilling equipment and systems; mechanical systems and
4

equipment; monitoring and secure systems; emergency
5

generators; hardware; computers; servers; data storage
6

devices; network connectivity equipment; racks; cabinets;
7

telecommunications cabling infrastructure; raised floor
8

systems; peripheral components or systems; software;
9

mechanical, electrical, or plumbing systems; battery
10

systems; cooling systems and towers; temperature control
11

systems; other cabling; and other data center
12

infrastructure equipment and systems necessary to operate
13

qualified tangible personal property, including fixtures;
14

and component parts of any of the foregoing, including
15

installation, maintenance, repair, refurbishment, and
16

replacement of qualified tangible personal property to
17

generate, transform, transmit, distribute, or manage
18

electricity necessary to operate qualified tangible
19

personal property; and all other tangible personal
20

property that is essential to the operations of a computer
21

data center. The term "qualified tangible personal
22

property" also includes building materials physically
23

incorporated into the qualifying data center. To document
24

the exemption allowed under this Section, the retailer
25

must obtain from the purchaser a copy of the certificate
26

of eligibility issued by the Department of Commerce and

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Economic Opportunity.
2

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

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

"Breast pump" means an electrically controlled or
9

manually controlled pump device designed or marketed to be
10

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

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

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

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

time of sale.
15

"Breast pump collection and storage supplies" means
16

items of tangible personal property designed or marketed
17

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

milk expressed from a human breast and to store collected
19

milk until it is ready for consumption.
20

"Breast pump collection and storage supplies"
21

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

shield connectors; breast pump tubes and tubing adapters;
23

breast pump valves and membranes; backflow protectors and
24

backflow protector adaptors; bottles and bottle caps
25

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

milk storage bags.

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"Breast pump collection and storage supplies" does not
2

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

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

and other similar carrying accessories, including ice
5

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

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

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

ointments, and other similar products that relieve
9

breastfeeding-related symptoms or conditions of the
10

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

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

or distributor.
13

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

more than a breast pump, breast pump collection and
15

storage supplies, a rechargeable battery for operating the
16

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

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

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

manufacturer or distributor.
20

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

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

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

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

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

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

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(1) software transferred subject to a license that
2

meets the following requirements:
3

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

by the licensor and the customer;
5

(i) an electronic agreement in which the
6

customer accepts the license by means of an
7

electronic signature that is verifiable and can be
8

authenticated and is attached to or made part of
9

the license will comply with this requirement;
10

(ii) a license agreement in which the customer
11

electronically accepts the terms by clicking "I
12

agree" does not comply with this requirement;
13

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

use of the software;
15

(C) it prohibits the customer from licensing,
16

sublicensing, or transferring the software to a third
17

party (except to a related party) without the
18

permission and continued control of the licensor;
19

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

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

damages the software, or of permitting the licensee to
22

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

either stated in the license agreement, supported by
24

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

notarized statement made under penalties of perjury by
26

the licensor; and

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

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

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

the case of a perpetual license, without being set
5

forth in the license agreement; and
6

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

receipts imposed by a home rule unit of local government
8

if the ordinance imposing that tax was adopted prior to
9

January 1, 2023.
10

(47) Beginning on January 1, 2027, tangible personal
11
property that is purchased for the improvement of residential
12
or nonresidential real estate by the installation of a solar
13
energy system that is primarily used to provide electricity to
14
the premises. This paragraph (47) applies to tangible personal
15
property that becomes a necessary part of the integrated solar
16
energy system, even if some of the tangible personal property
17
is not affixed to the real estate. For the purposes of this
18
paragraph (47), a solar energy system is considered to be
19
primarily used to provide electricity to the premises if the
20
solar energy system is used to offset the electricity load of
21
the end user, and the additional kilowatt-hours produced by
22
the system is not estimated to exceed by more than 110% the
23
kilowatt-hours of electricity consumed by the end user of
24
electricity at the meter in the last 12 full months before the
25
system is placed in service.
26

To qualify for the exemption under this paragraph (47),

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the purchaser must complete, at the point of sale, a form
2
prescribed by the Department documenting that the transaction
3
is eligible for the exemption under this paragraph. The
4
purchaser must keep the form as documentation of the exemption
5
in the purchaser's records for a period of not less than 6
6
years. This paragraph is exempt from the provisions of Section
7
3-90.

8

As used in this paragraph (47):

9

"Solar energy system" means a complete assembly,
10
mechanism, or structure that uses solar energy for generating
11
electricity by means of photovoltaics. A solar energy system
12
consists of an integration of several components, including
13
solar panels to absorb and convert sunlight into electricity,
14
a solar inverter to convert the output from direct to
15
alternating current, as well as mounting, cabling, and other
16
electrical accessories to set up a working system and the
17
necessary components, if any, of supplemental conventional
18
energy systems designed or constructed to interface with a
19
solar energy system.

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

25

Section 10.
The Service Use Tax Act is amended by changing

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Section 3-5 as follows:

2

(35 ILCS 110/3-5)
3

Sec. 3-5.
Exemptions.
Use 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 non-profit Illinois
13
county fair association for use in conducting, operating, or
14
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) Legal tender, currency, medallions, or gold or silver
6
coinage issued by the State of Illinois, the government of the
7
United States of America, or the government of any foreign
8
country, and bullion.
9

(5) Until July 1, 2003 and beginning again on September 1,
10
2004 through August 30, 2014, graphic arts machinery and
11
equipment, including repair and replacement parts, both new
12
and used, and including that manufactured on special order or
13
purchased for lease, certified by the purchaser to be used
14
primarily for graphic arts production. Equipment includes
15
chemicals or chemicals acting as catalysts but only if the
16
chemicals or chemicals acting as catalysts effect a direct and
17
immediate change upon a graphic arts product. Beginning on
18
July 1, 2017, graphic arts machinery and equipment is included
19
in the manufacturing and assembling machinery and equipment
20
exemption under Section 2 of this Act.
21

(6) Personal property purchased from a teacher-sponsored
22
student organization affiliated with an elementary or
23
secondary school located in Illinois.
24

(7) Farm machinery and equipment, both new and used,
25
including that manufactured on special order, certified by the
26
purchaser to be used primarily for production agriculture or

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State or federal agricultural programs, including individual
2
replacement parts for the machinery and equipment, including
3
machinery and equipment purchased for lease, and including
4
implements of husbandry defined in Section 1-130 of the
5
Illinois Vehicle Code, farm machinery and agricultural
6
chemical and fertilizer spreaders, and nurse wagons required
7
to be registered under Section 3-809 of the Illinois Vehicle
8
Code, but excluding other motor vehicles required to be
9
registered under the Illinois Vehicle Code. Horticultural
10
polyhouses or hoop houses used for propagating, growing, or
11
overwintering plants shall be considered farm machinery and
12
equipment under this item (7). Agricultural chemical tender
13
tanks and dry boxes shall include units sold separately from a
14
motor vehicle required to be licensed and units sold mounted
15
on a motor vehicle required to be licensed if the selling price
16
of the tender is separately stated.
17

Farm machinery and equipment shall include precision
18
farming equipment that is installed or purchased to be
19
installed on farm machinery and equipment, including, but not
20
limited to, tractors, harvesters, sprayers, planters, seeders,
21
or spreaders. Precision farming equipment includes, but is not
22
limited to, soil testing sensors, computers, monitors,
23
software, global positioning and mapping systems, and other
24
such equipment.
25

Farm machinery and equipment also includes computers,
26
sensors, software, and related equipment used primarily in the

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computer-assisted operation of production agriculture
2
facilities, equipment, and activities such as, but not limited
3
to, the collection, monitoring, and correlation of animal and
4
crop data for the purpose of formulating animal diets and
5
agricultural chemicals.
6

Beginning on January 1, 2024, farm machinery and equipment
7
also includes electrical power generation equipment used
8
primarily for production agriculture.
9

This item (7) is exempt from the provisions of Section
10
3-75.
11

(8) Until June 30, 2013, fuel and petroleum products sold
12
to or used by an air common carrier, certified by the carrier
13
to be used for consumption, shipment, or storage in the
14
conduct of its business as an air common carrier, for a flight
15
destined for or returning from a location or locations outside
16
the United States without regard to previous or subsequent
17
domestic stopovers.
18

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

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that aircraft.
2

(9) Proceeds of mandatory service charges separately
3
stated on customers' bills for the purchase and consumption of
4
food and beverages acquired as an incident to the purchase of a
5
service from a serviceman, to the extent that the proceeds of
6
the service charge are in fact turned over as tips or as a
7
substitute for tips to the employees who participate directly
8
in preparing, serving, hosting or cleaning up the food or
9
beverage function with respect to which the service charge is
10
imposed.
11

(10) Until July 1, 2003, oil field exploration, drilling,
12
and production equipment, including (i) rigs and parts of
13
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
14
pipe and tubular goods, including casing and drill strings,
15
(iii) pumps and pump-jack units, (iv) storage tanks and flow
16
lines, (v) any individual replacement part for oil field
17
exploration, drilling, and production equipment, and (vi)
18
machinery and equipment purchased for lease; but excluding
19
motor vehicles required to be registered under the Illinois
20
Vehicle Code.
21

(11) Proceeds from the sale of photoprocessing machinery
22
and equipment, including repair and replacement parts, both
23
new and used, including that manufactured on special order,
24
certified by the purchaser to be used primarily for
25
photoprocessing, and including photoprocessing machinery and
26
equipment purchased for lease.

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(12) Until July 1, 2028, coal and aggregate exploration,
2
mining, off-highway hauling, processing, maintenance, and
3
reclamation equipment, including replacement parts and
4
equipment, and including equipment purchased for lease, but
5
excluding motor vehicles required to be registered under the
6
Illinois Vehicle Code. The changes made to this Section by
7
Public Act 97-767 apply on and after July 1, 2003, but no claim
8
for credit or refund is allowed on or after August 16, 2013
9
(the effective date of Public Act 98-456) for such taxes paid
10
during the period beginning July 1, 2003 and ending on August
11
16, 2013 (the effective date of Public Act 98-456).
12

(13) Semen used for artificial insemination of livestock
13
for direct agricultural production.
14

(14) Horses, or interests in horses, registered with and
15
meeting the requirements of any of the Arabian Horse Club
16
Registry of America, Appaloosa Horse Club, American Quarter
17
Horse Association, United States Trotting Association, or
18
Jockey Club, as appropriate, used for purposes of breeding or
19
racing for prizes. This item (14) is exempt from the
20
provisions of Section 3-75, and the exemption provided for
21
under this item (14) applies for all periods beginning May 30,
22
1995, but no claim for credit or refund is allowed on or after
23
January 1, 2008 (the effective date of Public Act 95-88) for
24
such taxes paid during the period beginning May 30, 2000 and
25
ending on January 1, 2008 (the effective date of Public Act
26
95-88).

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

(16) Personal property purchased by a lessor who leases
25
the property, under a lease of one year or longer executed or
26
in effect at the time the lessor would otherwise be subject to

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the tax imposed by this Act, to a governmental body that has
2
been issued an active tax exemption identification number by
3
the Department under Section 1g of the Retailers' Occupation
4
Tax Act. If the property is leased in a manner that does not
5
qualify for this exemption or is used in any other non-exempt
6
manner, the lessor shall be liable for the tax imposed under
7
this Act or the Use Tax Act, as the case may be, based on the
8
fair market value of the property at the time the
9
non-qualifying use occurs. No lessor shall collect or attempt
10
to collect an amount (however designated) that purports to
11
reimburse that lessor for the tax imposed by this Act or the
12
Use Tax Act, as the case may be, if the tax has not been paid
13
by the lessor. If a lessor improperly collects any such amount
14
from the lessee, the lessee shall have a legal right to claim a
15
refund of that amount from the lessor. If, however, that
16
amount is not refunded to the lessee for any reason, the lessor
17
is liable to pay that amount to the Department.
18

(17) Beginning with taxable years ending on or after
19
December 31, 1995 and ending with taxable years ending on or
20
before December 31, 2004, personal property that is donated
21
for disaster relief to be used in a State or federally declared
22
disaster area in Illinois or bordering Illinois by a
23
manufacturer or retailer that is registered in this State to a
24
corporation, society, association, foundation, or institution
25
that has been issued a sales tax exemption identification
26
number by the Department that assists victims of the disaster

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who reside within the declared disaster area.
2

(18) Beginning with taxable years ending on or after
3
December 31, 1995 and ending with taxable years ending on or
4
before December 31, 2004, personal property that is used in
5
the performance of infrastructure repairs in this State,
6
including, but not limited to, municipal roads and streets,
7
access roads, bridges, sidewalks, waste disposal systems,
8
water and sewer line extensions, water distribution and
9
purification facilities, storm water drainage and retention
10
facilities, and sewage treatment facilities, resulting from a
11
State or federally declared disaster in Illinois or bordering
12
Illinois when such repairs are initiated on facilities located
13
in the declared disaster area within 6 months after the
14
disaster.
15

(19) Beginning July 1, 1999, game or game birds purchased
16
at a "game breeding and hunting preserve area" as that term is
17
used in the Wildlife Code. This paragraph is exempt from the
18
provisions of Section 3-75.
19

(20) A motor vehicle, as that term is defined in Section
20
1-146 of the Illinois Vehicle Code, that is donated to a
21
corporation, limited liability company, society, association,
22
foundation, or institution that is determined by the
23
Department to be organized and operated exclusively for
24
educational purposes. For purposes of this exemption, "a
25
corporation, limited liability company, society, association,
26
foundation, or institution organized and operated exclusively

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

(21) Beginning January 1, 2000, personal property,
13
including food, purchased through fundraising events for the
14
benefit of a public or private elementary or secondary school,
15
a group of those schools, or one or more school districts if
16
the events are sponsored by an entity recognized by the school
17
district that consists primarily of volunteers and includes
18
parents and teachers of the school children. This paragraph
19
does not apply to fundraising events (i) for the benefit of
20
private home instruction or (ii) for which the fundraising
21
entity purchases the personal property sold at the events from
22
another individual or entity that sold the property for the
23
purpose of resale by the fundraising entity and that profits
24
from the sale to the fundraising entity. This paragraph is
25
exempt from the provisions of Section 3-75.
26

(22) Beginning January 1, 2000 and through December 31,

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2001, new or used automatic vending machines that prepare and
2
serve hot food and beverages, including coffee, soup, and
3
other items, and replacement parts for these machines.
4
Beginning January 1, 2002 and through June 30, 2003, machines
5
and parts for machines used in commercial, coin-operated
6
amusement and vending business if a use or occupation tax is
7
paid on the gross receipts derived from the use of the
8
commercial, coin-operated amusement and vending machines. This
9
paragraph is exempt from the provisions of Section 3-75.
10

(23) Beginning August 23, 2001 and through June 30, 2016,
11
food for human consumption that is to be consumed off the
12
premises where it is sold (other than alcoholic beverages,
13
soft drinks, and food that has been prepared for immediate
14
consumption) and prescription and nonprescription medicines,
15
drugs, medical appliances, and insulin, urine testing
16
materials, syringes, and needles used by diabetics, for human
17
use, when purchased for use by a person receiving medical
18
assistance under Article V of the Illinois Public Aid Code who
19
resides in a licensed long-term care facility, as defined in
20
the Nursing Home Care Act, or in a licensed facility as defined
21
in the ID/DD Community Care Act, the MC/DD Act, or the
22
Specialized Mental Health Rehabilitation Act of 2013.
23

(24) Beginning on August 2, 2001 (the effective date of
24
Public Act 92-227), computers and communications equipment
25
utilized for any hospital purpose and equipment used in the
26
diagnosis, analysis, or treatment of hospital patients

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purchased by a lessor who leases the equipment, under a lease
2
of one year or longer executed or in effect at the time the
3
lessor would otherwise be subject to the tax imposed by this
4
Act, to a hospital that has been issued an active tax exemption
5
identification number by the Department under Section 1g of
6
the Retailers' Occupation Tax Act. If the equipment is leased
7
in a manner that does not qualify for this exemption or is used
8
in any other nonexempt manner, the lessor shall be liable for
9
the tax imposed under this Act or the Use Tax Act, as the case
10
may be, based on the fair market value of the property at the
11
time the nonqualifying use occurs. No lessor shall collect or
12
attempt to collect an amount (however designated) that
13
purports to reimburse that lessor for the tax imposed by this
14
Act or the Use Tax Act, as the case may be, if the tax has not
15
been paid by the lessor. If a lessor improperly collects any
16
such amount from the lessee, the lessee shall have a legal
17
right to claim a refund of that amount from the lessor. If,
18
however, that amount is not refunded to the lessee for any
19
reason, the lessor is liable to pay that amount to the
20
Department. This paragraph is exempt from the provisions of
21
Section 3-75.
22

(25) Beginning on August 2, 2001 (the effective date of
23
Public Act 92-227), personal property purchased by a lessor
24
who leases the property, under a lease of one year or longer
25
executed or in effect at the time the lessor would otherwise be
26
subject to the tax imposed by this Act, to a governmental body

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that has been issued an active tax exemption identification
2
number by the Department under Section 1g of the Retailers'
3
Occupation Tax Act. If the property is leased in a manner that
4
does not qualify for this exemption or is used in any other
5
nonexempt manner, the lessor shall be liable for the tax
6
imposed under this Act or the Use Tax Act, as the case may be,
7
based on the fair market value of the property at the time the
8
nonqualifying use occurs. No lessor shall collect or attempt
9
to collect an amount (however designated) that purports to
10
reimburse that lessor for the tax imposed by this Act or the
11
Use Tax Act, as the case may be, if the tax has not been paid
12
by the lessor. If a lessor improperly collects any such amount
13
from the lessee, the lessee shall have a legal right to claim a
14
refund of that amount from the lessor. If, however, that
15
amount is not refunded to the lessee for any reason, the lessor
16
is liable to pay that amount to the Department. This paragraph
17
is exempt from the provisions of Section 3-75.
18

(26) Beginning January 1, 2008, tangible personal property
19
used in the construction or maintenance of a community water
20
supply, as defined under Section 3.145 of the Environmental
21
Protection Act, that is operated by a not-for-profit
22
corporation that holds a valid water supply permit issued
23
under Title IV of the Environmental Protection Act. This
24
paragraph is exempt from the provisions of Section 3-75.
25

(27) 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 use of qualifying
17
tangible personal property transferred incident to the
18
modification, refurbishment, completion, replacement, repair,
19
or maintenance of 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
From January 1, 2024 through December 31, 2029, this exemption
25
applies only to the use of qualifying tangible personal
26
property transferred incident to: (A) the modification,

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refurbishment, completion, repair, replacement, or maintenance
2
of an aircraft by persons who (i) hold an Air Agency
3
Certificate and are empowered to operate an approved repair
4
station by the Federal Aviation Administration, (ii) have a
5
Class IV Rating, and (iii) conduct operations in accordance
6
with Part 145 of the Federal Aviation Regulations; and (B) the
7
modification, replacement, repair, and maintenance of aircraft
8
engines or power plants without regard to whether or not those
9
persons meet the qualifications of item (A).
10

The exemption does not include aircraft operated by a
11
commercial air carrier providing scheduled passenger air
12
service pursuant to authority issued under Part 121 or Part
13
129 of the Federal Aviation Regulations. The changes made to
14
this paragraph (27) by Public Act 98-534 are declarative of
15
existing law. It is the intent of the General Assembly that the
16
exemption under this paragraph (27) applies continuously from
17
January 1, 2010 through December 31, 2024; however, no claim
18
for credit or refund is allowed for taxes paid as a result of
19
the disallowance of this exemption on or after January 1, 2015
20
and prior to February 5, 2020 (the effective date of Public Act
21
101-629).
22

(28) Tangible personal property purchased by a
23
public-facilities corporation, as described in Section
24
11-65-10 of the Illinois Municipal Code, for purposes of
25
constructing or furnishing a municipal convention hall, but
26
only if the legal title to the municipal convention hall is

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transferred to the municipality without any further
2
consideration by or on behalf of the municipality at the time
3
of the completion of the municipal convention hall or upon the
4
retirement or redemption of any bonds or other debt
5
instruments issued by the public-facilities corporation in
6
connection with the development of the municipal convention
7
hall. This exemption includes existing public-facilities
8
corporations as provided in Section 11-65-25 of the Illinois
9
Municipal Code. This paragraph is exempt from the provisions
10
of Section 3-75.
11

(29) Beginning January 1, 2017 and through December 31,
12
2026, menstrual pads, tampons, and menstrual cups.
13

(30) Tangible personal property transferred to a purchaser
14
who is exempt from the tax imposed by this Act by operation of
15
federal law. This paragraph is exempt from the provisions of
16
Section 3-75.
17

(31) Qualified tangible personal property used in the
18
construction or operation of a data center that has been
19
granted a certificate of exemption by the Department of
20
Commerce and Economic Opportunity, whether that tangible
21
personal property is purchased by the owner, operator, or
22
tenant of the data center or by a contractor or subcontractor
23
of the owner, operator, or tenant. Data centers that would
24
have qualified for a certificate of exemption prior to January
25
1, 2020 had Public Act 101-31 been in effect, may apply for and
26
obtain an exemption for subsequent purchases of computer

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1
equipment or enabling software purchased or leased to upgrade,
2
supplement, or replace computer equipment or enabling software
3
purchased or leased in the original investment that would have
4
qualified.
5

The Department of Commerce and Economic Opportunity shall
6
grant a certificate of exemption under this item (31) to
7
qualified data centers as defined by Section 605-1025 of the
8
Department of Commerce and Economic Opportunity Law of the
9
Civil Administrative Code of Illinois.
10

For the purposes of this item (31):
11

"Data center" means a building or a series of
12

buildings rehabilitated or constructed to house working
13

servers in one physical location or multiple sites within
14

the State of Illinois.
15

"Qualified tangible personal property" means:
16

electrical systems and equipment; climate control and
17

chilling equipment and systems; mechanical systems and
18

equipment; monitoring and secure systems; emergency
19

generators; hardware; computers; servers; data storage
20

devices; network connectivity equipment; racks; cabinets;
21

telecommunications cabling infrastructure; raised floor
22

systems; peripheral components or systems; software;
23

mechanical, electrical, or plumbing systems; battery
24

systems; cooling systems and towers; temperature control
25

systems; other cabling; and other data center
26

infrastructure equipment and systems necessary to operate

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qualified tangible personal property, including fixtures;
2

and component parts of any of the foregoing, including
3

installation, maintenance, repair, refurbishment, and
4

replacement of qualified tangible personal property to
5

generate, transform, transmit, distribute, or manage
6

electricity necessary to operate qualified tangible
7

personal property; and all other tangible personal
8

property that is essential to the operations of a computer
9

data center. The term "qualified tangible personal
10

property" also includes building materials physically
11

incorporated into the qualifying data center. To document
12

the exemption allowed under this Section, the retailer
13

must obtain from the purchaser a copy of the certificate
14

of eligibility issued by the Department of Commerce and
15

Economic Opportunity.
16

This item (31) is exempt from the provisions of Section
17
3-75.
18

(32) Beginning July 1, 2022, breast pumps, breast pump
19
collection and storage supplies, and breast pump kits. This
20
item (32) is exempt from the provisions of Section 3-75. As
21
used in this item (32):
22

"Breast pump" means an electrically controlled or
23

manually controlled pump device designed or marketed to be
24

used to express milk from a human breast during lactation,
25

including the pump device and any battery, AC adapter, or
26

other power supply unit that is used to power the pump

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device and is packaged and sold with the pump device at the
2

time of sale.
3

"Breast pump collection and storage supplies" means
4

items of tangible personal property designed or marketed
5

to be used in conjunction with a breast pump to collect
6

milk expressed from a human breast and to store collected
7

milk until it is ready for consumption.
8

"Breast pump collection and storage supplies"
9

includes, but is not limited to: breast shields and breast
10

shield connectors; breast pump tubes and tubing adapters;
11

breast pump valves and membranes; backflow protectors and
12

backflow protector adaptors; bottles and bottle caps
13

specific to the operation of the breast pump; and breast
14

milk storage bags.
15

"Breast pump collection and storage supplies" does not
16

include: (1) bottles and bottle caps not specific to the
17

operation of the breast pump; (2) breast pump travel bags
18

and other similar carrying accessories, including ice
19

packs, labels, and other similar products; (3) breast pump
20

cleaning supplies; (4) nursing bras, bra pads, breast
21

shells, and other similar products; and (5) creams,
22

ointments, and other similar products that relieve
23

breastfeeding-related symptoms or conditions of the
24

breasts or nipples, unless sold as part of a breast pump
25

kit that is pre-packaged by the breast pump manufacturer
26

or distributor.

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1

"Breast pump kit" means a kit that: (1) contains no
2

more than a breast pump, breast pump collection and
3

storage supplies, a rechargeable battery for operating the
4

breast pump, a breastmilk cooler, bottle stands, ice
5

packs, and a breast pump carrying case; and (2) is
6

pre-packaged as a breast pump kit by the breast pump
7

manufacturer or distributor.
8

(33) Tangible personal property sold by or on behalf of
9
the State Treasurer pursuant to the Revised Uniform Unclaimed
10
Property Act. This item (33) is exempt from the provisions of
11
Section 3-75.
12

(34) Beginning on January 1, 2024, tangible personal
13
property purchased by an active duty member of the armed
14
forces of the United States who presents valid military
15
identification and purchases the property using a form of
16
payment where the federal government is the payor. The member
17
of the armed forces must complete, at the point of sale, a form
18
prescribed by the Department of Revenue documenting that the
19
transaction is eligible for the exemption under this
20
paragraph. Retailers must keep the form as documentation of
21
the exemption in their records for a period of not less than 6
22
years. "Armed forces of the United States" means the United
23
States Army, Navy, Air Force, Space Force, Marine Corps, or
24
Coast Guard. This paragraph is exempt from the provisions of
25
Section 3-75.
26

(35) Beginning July 1, 2024, home-delivered meals provided

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to Medicare or Medicaid recipients when payment is made by an
2
intermediary, such as a Medicare Administrative Contractor, a
3
Managed Care Organization, or a Medicare Advantage
4
Organization, pursuant to a government contract. This
5
paragraph (35) is exempt from the provisions of Section 3-75.
6

(36) Beginning on January 1, 2026, as further defined in
7
Section 3-10, food prepared for immediate consumption and
8
transferred incident to a sale of service subject to this Act
9
or the Service Occupation Tax Act by an entity licensed under
10
the Hospital Licensing Act, the Nursing Home Care Act, the
11
Assisted Living and Shared Housing Act, the ID/DD Community
12
Care Act, the MC/DD Act, the Specialized Mental Health
13
Rehabilitation Act of 2013, or the Child Care Act of 1969 or by
14
an entity that holds a permit issued pursuant to the Life Care
15
Facilities Act. This item (36) is exempt from the provisions
16
of Section 3-75.
17

(37) Beginning on January 1, 2026, as further defined in
18
Section 3-10, food for human consumption that is to be
19
consumed off the premises where it is sold (other than
20
alcoholic beverages, food consisting of or infused with adult
21
use cannabis, soft drinks, candy, and food that has been
22
prepared for immediate consumption). This item (37) is exempt
23
from the provisions of Section 3-75.
24

(38) Use by a lessee of the following leased tangible
25
personal property:
26

(1) software transferred subject to a license that

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1

meets the following requirements:
2

(A) it is evidenced by a written agreement signed
3

by the licensor and the customer;
4

(i) an electronic agreement in which the
5

customer accepts the license by means of an
6

electronic signature that is verifiable and can be
7

authenticated and is attached to or made part of
8

the license will comply with this requirement;
9

(ii) a license agreement in which the customer
10

electronically accepts the terms by clicking "I
11

agree" does not comply with this requirement;
12

(B) it restricts the customer's duplication and
13

use of the software;
14

(C) it prohibits the customer from licensing,
15

sublicensing, or transferring the software to a third
16

party (except to a related party) without the
17

permission and continued control of the licensor;
18

(D) the licensor has a policy of providing another
19

copy at minimal or no charge if the customer loses or
20

damages the software, or of permitting the licensee to
21

make and keep an archival copy, and such policy is
22

either stated in the license agreement, supported by
23

the licensor's books and records, or supported by a
24

notarized statement made under penalties of perjury by
25

the licensor; and
26

(E) the customer must destroy or return all copies

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of the software to the licensor at the end of the
2

license period; this provision is deemed to be met, in
3

the case of a perpetual license, without being set
4

forth in the license agreement; and
5

(2) property that is subject to a tax on lease
6

receipts imposed by a home rule unit of local government
7

if the ordinance imposing that tax was adopted prior to
8

January 1, 2023.
9

(39) Beginning on January 1, 2027, tangible personal
10
property that is purchased for the improvement of residential
11
or nonresidential real estate by the installation of a solar
12
energy system that is primarily used to provide electricity to
13
the premises. This paragraph (39) applies to tangible personal
14
property that becomes a necessary part of the integrated solar
15
energy system, even if some of the tangible personal property
16
is not affixed to the real estate. For the purposes of this
17
paragraph (39), a solar energy system is considered to be
18
primarily used to provide electricity to the premises if the
19
solar energy system is used to offset the electricity load of
20
the end user, and the additional kilowatt-hours produced by
21
the system is not estimated to exceed by more than 110% the
22
kilowatt-hours of electricity consumed by the end user of
23
electricity at the meter in the last 12 full months before the
24
system is placed in service.
25

To qualify for the exemption under this paragraph (39),
26
the purchaser must complete, at the point of sale, a form

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prescribed by the Department documenting that the transaction
2
is eligible for the exemption under this paragraph. The
3
purchaser must keep the form as documentation of the exemption
4
in the purchaser's records for a period of not less than 6
5
years. This paragraph is exempt from the provisions of Section
6
3-75.

7

As used in this paragraph (39):

8

"Solar energy system" means a complete assembly,
9
mechanism, or structure that uses solar energy for generating
10
electricity by means of photovoltaics. A solar energy system
11
consists of an integration of several components, including
12
solar panels to absorb and convert sunlight into electricity,
13
a solar inverter to convert the output from direct to
14
alternating current, as well as mounting, cabling, and other
15
electrical accessories to set up a working system and the
16
necessary components, if any, of supplemental conventional
17
energy systems designed or constructed to interface with a
18
solar energy system.

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

25

Section 15.
The Service Occupation Tax Act is amended by

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changing Section 3-5 as follows:

2

(35 ILCS 115/3-5)
3

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

(1) Personal property sold by a corporation, society,
6
association, foundation, institution, or organization, other
7
than a limited liability company, that is organized and
8
operated as a not-for-profit service enterprise for the
9
benefit of persons 65 years of age or older if the personal
10
property was not purchased by the enterprise for the purpose
11
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 any 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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1
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) Legal tender, currency, medallions, or gold or silver
6
coinage issued by the State of Illinois, the government of the
7
United States of America, or the government of any foreign
8
country, and bullion.
9

(5) Until July 1, 2003 and beginning again on September 1,
10
2004 through August 30, 2014, graphic arts machinery and
11
equipment, including repair and replacement parts, both new
12
and used, and including that manufactured on special order or
13
purchased for lease, certified by the purchaser to be used
14
primarily for graphic arts production. Equipment includes
15
chemicals or chemicals acting as catalysts but only if the
16
chemicals or chemicals acting as catalysts effect a direct and
17
immediate change upon a graphic arts product. Beginning on
18
July 1, 2017, graphic arts machinery and equipment is included
19
in the manufacturing and assembling machinery and equipment
20
exemption under Section 2 of this Act.
21

(6) Personal property sold by a teacher-sponsored student
22
organization affiliated with an elementary or secondary school
23
located in Illinois.
24

(7) Farm machinery and equipment, both new and used,
25
including that manufactured on special order, certified by the
26
purchaser to be used primarily for production agriculture or

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State or federal agricultural programs, including individual
2
replacement parts for the machinery and equipment, including
3
machinery and equipment purchased for lease, and including
4
implements of husbandry defined in Section 1-130 of the
5
Illinois Vehicle Code, farm machinery and agricultural
6
chemical and fertilizer spreaders, and nurse wagons required
7
to be registered under Section 3-809 of the Illinois Vehicle
8
Code, but excluding other motor vehicles required to be
9
registered under the Illinois Vehicle Code. Horticultural
10
polyhouses or hoop houses used for propagating, growing, or
11
overwintering plants shall be considered farm machinery and
12
equipment under this item (7). Agricultural chemical tender
13
tanks and dry boxes shall include units sold separately from a
14
motor vehicle required to be licensed and units sold mounted
15
on a motor vehicle required to be licensed if the selling price
16
of the tender is separately stated.
17

Farm machinery and equipment shall include precision
18
farming equipment that is installed or purchased to be
19
installed on farm machinery and equipment, including, but not
20
limited to, tractors, harvesters, sprayers, planters, seeders,
21
or spreaders. Precision farming equipment includes, but is not
22
limited to, soil testing sensors, computers, monitors,
23
software, global positioning and mapping systems, and other
24
such equipment.
25

Farm machinery and equipment also includes computers,
26
sensors, software, and related equipment used primarily in the

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computer-assisted operation of production agriculture
2
facilities, equipment, and activities such as, but not limited
3
to, the collection, monitoring, and correlation of animal and
4
crop data for the purpose of formulating animal diets and
5
agricultural chemicals.
6

Beginning on January 1, 2024, farm machinery and equipment
7
also includes electrical power generation equipment used
8
primarily for production agriculture.
9

This item (7) is exempt from the provisions of Section
10
3-55.
11

(8) Until June 30, 2013, fuel and petroleum products sold
12
to or used by an air common carrier, certified by the carrier
13
to be used for consumption, shipment, or storage in the
14
conduct of its business as an air common carrier, for a flight
15
destined for or returning from a location or locations outside
16
the United States without regard to previous or subsequent
17
domestic stopovers.
18

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

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that aircraft.
2

(9) Proceeds of mandatory service charges separately
3
stated on customers' bills for the purchase and consumption of
4
food and beverages, to the extent that the proceeds of the
5
service charge are in fact turned over as tips or as a
6
substitute for tips to the employees who participate directly
7
in preparing, serving, hosting or cleaning up the food or
8
beverage function with respect to which the service charge is
9
imposed.
10

(10) Until July 1, 2003, oil field exploration, drilling,
11
and production equipment, including (i) rigs and parts of
12
rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
13
pipe and tubular goods, including casing and drill strings,
14
(iii) pumps and pump-jack units, (iv) storage tanks and flow
15
lines, (v) any individual replacement part for oil field
16
exploration, drilling, and production equipment, and (vi)
17
machinery and equipment purchased for lease; but excluding
18
motor vehicles required to be registered under the Illinois
19
Vehicle Code.
20

(11) Photoprocessing machinery and equipment, including
21
repair and replacement parts, both new and used, including
22
that manufactured on special order, certified by the purchaser
23
to be used primarily for photoprocessing, and including
24
photoprocessing machinery and equipment purchased for lease.
25

(12) Until July 1, 2028, coal and aggregate exploration,
26
mining, off-highway hauling, processing, maintenance, and

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reclamation equipment, including replacement parts and
2
equipment, and including equipment purchased for lease, but
3
excluding motor vehicles required to be registered under the
4
Illinois Vehicle Code. The changes made to this Section by
5
Public Act 97-767 apply on and after July 1, 2003, but no claim
6
for credit or refund is allowed on or after August 16, 2013
7
(the effective date of Public Act 98-456) for such taxes paid
8
during the period beginning July 1, 2003 and ending on August
9
16, 2013 (the effective date of Public Act 98-456).
10

(13) Beginning January 1, 1992 and through June 30, 2016,
11
food for human consumption that is to be consumed off the
12
premises where it is sold (other than alcoholic beverages,
13
soft drinks and food that has been prepared for immediate
14
consumption) and prescription and non-prescription medicines,
15
drugs, medical appliances, and insulin, urine testing
16
materials, syringes, and needles used by diabetics, for human
17
use, when purchased for use by a person receiving medical
18
assistance under Article V of the Illinois Public Aid Code who
19
resides in a licensed long-term care facility, as defined in
20
the Nursing Home Care Act, or in a licensed facility as defined
21
in the ID/DD Community Care Act, the MC/DD Act, or the
22
Specialized Mental Health Rehabilitation Act of 2013.
23

(14) Semen used for artificial insemination of livestock
24
for direct agricultural production.
25

(15) Horses, or interests in horses, registered with and
26
meeting the requirements of any of the Arabian Horse Club

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Registry of America, Appaloosa Horse Club, American Quarter
2
Horse Association, United States Trotting Association, or
3
Jockey Club, as appropriate, used for purposes of breeding or
4
racing for prizes. This item (15) is exempt from the
5
provisions of Section 3-55, and the exemption provided for
6
under this item (15) applies for all periods beginning May 30,
7
1995, but no claim for credit or refund is allowed on or after
8
January 1, 2008 (the effective date of Public Act 95-88) for
9
such taxes paid during the period beginning May 30, 2000 and
10
ending on January 1, 2008 (the effective date of Public Act
11
95-88).
12

(16) Computers and communications equipment utilized for
13
any hospital purpose and equipment used in the diagnosis,
14
analysis, or treatment of hospital patients sold to a lessor
15
who leases the equipment, under a lease of one year or longer
16
executed or in effect at the time of the purchase, to a
17
hospital that has been issued an active tax exemption
18
identification number by the Department under Section 1g of
19
the Retailers' Occupation Tax Act.
20

(17) Personal property sold to a lessor who leases the
21
property, under a lease of one year or longer executed or in
22
effect at the time of the purchase, to a governmental body that
23
has been issued an active tax exemption identification number
24
by the Department under Section 1g of the Retailers'
25
Occupation Tax Act.
26

(18) 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

(19) 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

(20) Beginning July 1, 1999, game or game birds sold at a
24
"game breeding and hunting preserve area" as that term is used
25
in the Wildlife Code. This paragraph is exempt from the
26
provisions of Section 3-55.

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(21) 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

(22) 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 3-55.
8

(23) 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 3-55.
18

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

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from the provisions of Section 3-55.
2

(25) Beginning on August 2, 2001 (the effective date of
3
Public Act 92-227), personal property sold to a lessor who
4
leases the property, under a lease of one year or longer
5
executed or in effect at the time of the purchase, to a
6
governmental body that has been issued an active tax exemption
7
identification number by the Department under Section 1g of
8
the Retailers' Occupation Tax Act. This paragraph is exempt
9
from the provisions of Section 3-55.
10

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

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manner specified in the rules adopted under this Act, to
2
purchase tangible personal property from a retailer exempt
3
from the taxes imposed by this Act. Taxpayers shall maintain
4
all necessary books and records to substantiate the use and
5
consumption of all such tangible personal property outside of
6
the State of Illinois.
7

(27) Beginning January 1, 2008, tangible personal property
8
used in the construction or maintenance of a community water
9
supply, as defined under Section 3.145 of the Environmental
10
Protection Act, that is operated by a not-for-profit
11
corporation that holds a valid water supply permit issued
12
under Title IV of the Environmental Protection Act. This
13
paragraph is exempt from the provisions of Section 3-55.
14

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

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Municipal Code. This paragraph is exempt from the provisions
2
of Section 3-55.
3

(29) Beginning January 1, 2010 and continuing through
4
December 31, 2029, materials, parts, equipment, components,
5
and furnishings incorporated into or upon an aircraft as part
6
of the modification, refurbishment, completion, replacement,
7
repair, or maintenance of the aircraft. This exemption
8
includes consumable supplies used in the modification,
9
refurbishment, completion, replacement, repair, and
10
maintenance of aircraft. However, until January 1, 2024, this
11
exemption excludes any materials, parts, equipment,
12
components, and consumable supplies used in the modification,
13
replacement, repair, and maintenance of aircraft engines or
14
power plants, whether such engines or power plants are
15
installed or uninstalled upon any such aircraft. "Consumable
16
supplies" include, but are not limited to, adhesive, tape,
17
sandpaper, general purpose lubricants, cleaning solution,
18
latex gloves, and protective films.
19

Beginning January 1, 2010 and continuing through December
20
31, 2023, this exemption applies only to the transfer of
21
qualifying tangible personal property incident to the
22
modification, refurbishment, completion, replacement, repair,
23
or maintenance of an aircraft by persons who (i) hold an Air
24
Agency Certificate and are empowered to operate an approved
25
repair station by the Federal Aviation Administration, (ii)
26
have a Class IV Rating, and (iii) conduct operations in

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accordance with Part 145 of the Federal Aviation Regulations.
2
The exemption does not include aircraft operated by a
3
commercial air carrier providing scheduled passenger air
4
service pursuant to authority issued under Part 121 or Part
5
129 of the Federal Aviation Regulations. From January 1, 2024
6
through December 31, 2029, this exemption applies only to the
7
transfer of qualifying tangible personal property incident to:
8
(A) the modification, refurbishment, completion, repair,
9
replacement, or maintenance of an aircraft by persons who (i)
10
hold an Air Agency Certificate and are empowered to operate an
11
approved repair station by the Federal Aviation
12
Administration, (ii) have a Class IV Rating, and (iii) conduct
13
operations in accordance with Part 145 of the Federal Aviation
14
Regulations; and (B) the modification, replacement, repair,
15
and maintenance of aircraft engines or power plants without
16
regard to whether or not those persons meet the qualifications
17
of item (A).
18

The changes made to this paragraph (29) by Public Act
19
98-534 are declarative of existing law. It is the intent of the
20
General Assembly that the exemption under this paragraph (29)
21
applies continuously from January 1, 2010 through December 31,
22
2024; however, no claim for credit or refund is allowed for
23
taxes paid as a result of the disallowance of this exemption on
24
or after January 1, 2015 and prior to February 5, 2020 (the
25
effective date of Public Act 101-629).
26

(30) Beginning January 1, 2017 and through December 31,

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2026, menstrual pads, tampons, and menstrual cups.
2

(31) Tangible personal property transferred to a purchaser
3
who is exempt from tax by operation of federal law. This
4
paragraph is exempt from the provisions of Section 3-55.
5

(32) Qualified tangible personal property used in the
6
construction or operation of a data center that has been
7
granted a certificate of exemption by the Department of
8
Commerce and Economic Opportunity, whether that tangible
9
personal property is purchased by the owner, operator, or
10
tenant of the data center or by a contractor or subcontractor
11
of the owner, operator, or tenant. Data centers that would
12
have qualified for a certificate of exemption prior to January
13
1, 2020 had Public Act 101-31 been in effect, may apply for and
14
obtain an exemption for subsequent purchases of computer
15
equipment or enabling software purchased or leased to upgrade,
16
supplement, or replace computer equipment or enabling software
17
purchased or leased in the original investment that would have
18
qualified.
19

The Department of Commerce and Economic Opportunity shall
20
grant a certificate of exemption under this item (32) to
21
qualified data centers as defined by Section 605-1025 of the
22
Department of Commerce and Economic Opportunity Law of the
23
Civil Administrative Code of Illinois.
24

For the purposes of this item (32):
25

"Data center" means a building or a series of
26

buildings rehabilitated or constructed to house working

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servers in one physical location or multiple sites within
2

the State of Illinois.
3

"Qualified tangible personal property" means:
4

electrical systems and equipment; climate control and
5

chilling equipment and systems; mechanical systems and
6

equipment; monitoring and secure systems; emergency
7

generators; hardware; computers; servers; data storage
8

devices; network connectivity equipment; racks; cabinets;
9

telecommunications cabling infrastructure; raised floor
10

systems; peripheral components or systems; software;
11

mechanical, electrical, or plumbing systems; battery
12

systems; cooling systems and towers; temperature control
13

systems; other cabling; and other data center
14

infrastructure equipment and systems necessary to operate
15

qualified tangible personal property, including fixtures;
16

and component parts of any of the foregoing, including
17

installation, maintenance, repair, refurbishment, and
18

replacement of qualified tangible personal property to
19

generate, transform, transmit, distribute, or manage
20

electricity necessary to operate qualified tangible
21

personal property; and all other tangible personal
22

property that is essential to the operations of a computer
23

data center. The term "qualified tangible personal
24

property" also includes building materials physically
25

incorporated into the qualifying data center. To document
26

the exemption allowed under this Section, the retailer

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must obtain from the purchaser a copy of the certificate
2

of eligibility issued by the Department of Commerce and
3

Economic Opportunity.
4

This item (32) is exempt from the provisions of Section
5
3-55.
6

(33) Beginning July 1, 2022, breast pumps, breast pump
7
collection and storage supplies, and breast pump kits. This
8
item (33) is exempt from the provisions of Section 3-55. As
9
used in this item (33):
10

"Breast pump" means an electrically controlled or
11

manually controlled pump device designed or marketed to be
12

used to express milk from a human breast during lactation,
13

including the pump device and any battery, AC adapter, or
14

other power supply unit that is used to power the pump
15

device and is packaged and sold with the pump device at the
16

time of sale.
17

"Breast pump collection and storage supplies" means
18

items of tangible personal property designed or marketed
19

to be used in conjunction with a breast pump to collect
20

milk expressed from a human breast and to store collected
21

milk until it is ready for consumption.
22

"Breast pump collection and storage supplies"
23

includes, but is not limited to: breast shields and breast
24

shield connectors; breast pump tubes and tubing adapters;
25

breast pump valves and membranes; backflow protectors and
26

backflow protector adaptors; bottles and bottle caps

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specific to the operation of the breast pump; and breast
2

milk storage bags.
3

"Breast pump collection and storage supplies" does not
4

include: (1) bottles and bottle caps not specific to the
5

operation of the breast pump; (2) breast pump travel bags
6

and other similar carrying accessories, including ice
7

packs, labels, and other similar products; (3) breast pump
8

cleaning supplies; (4) nursing bras, bra pads, breast
9

shells, and other similar products; and (5) creams,
10

ointments, and other similar products that relieve
11

breastfeeding-related symptoms or conditions of the
12

breasts or nipples, unless sold as part of a breast pump
13

kit that is pre-packaged by the breast pump manufacturer
14

or distributor.
15

"Breast pump kit" means a kit that: (1) contains no
16

more than a breast pump, breast pump collection and
17

storage supplies, a rechargeable battery for operating the
18

breast pump, a breastmilk cooler, bottle stands, ice
19

packs, and a breast pump carrying case; and (2) is
20

pre-packaged as a breast pump kit by the breast pump
21

manufacturer or distributor.
22

(34) Tangible personal property sold by or on behalf of
23
the State Treasurer pursuant to the Revised Uniform Unclaimed
24
Property Act. This item (34) is exempt from the provisions of
25
Section 3-55.
26

(35) Beginning on January 1, 2024, tangible personal

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property purchased by an active duty member of the armed
2
forces of the United States who presents valid military
3
identification and purchases the property using a form of
4
payment where the federal government is the payor. The member
5
of the armed forces must complete, at the point of sale, a form
6
prescribed by the Department of Revenue documenting that the
7
transaction is eligible for the exemption under this
8
paragraph. Retailers must keep the form as documentation of
9
the exemption in their records for a period of not less than 6
10
years. "Armed forces of the United States" means the United
11
States Army, Navy, Air Force, Space Force, Marine Corps, or
12
Coast Guard. This paragraph is exempt from the provisions of
13
Section 3-55.
14

(36) Beginning July 1, 2024, home-delivered meals provided
15
to Medicare or Medicaid recipients when payment is made by an
16
intermediary, such as a Medicare Administrative Contractor, a
17
Managed Care Organization, or a Medicare Advantage
18
Organization, pursuant to a government contract. This
19
paragraph (36) is exempt from the provisions of Section 3-55.
20

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

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Rehabilitation Act of 2013, or the Child Care Act of 1969 or by
2
an entity that holds a permit issued pursuant to the Life Care
3
Facilities Act. This item (37) is exempt from the provisions
4
of Section 3-55.
5

(38) Beginning on January 1, 2026, as further defined in
6
Section 3-10, food for human consumption that is to be
7
consumed off the premises where it is sold (other than
8
alcoholic beverages, food consisting of or infused with adult
9
use cannabis, soft drinks, candy, and food that has been
10
prepared for immediate consumption). This item (38) is exempt
11
from the provisions of Section 3-55.
12

(39) The lease of the following tangible personal
13
property:
14

(1) computer software transferred subject to a license
15

that meets the following requirements:
16

(A) it is evidenced by a written agreement signed
17

by the licensor and the customer;
18

(i) an electronic agreement in which the
19

customer accepts the license by means of an
20

electronic signature that is verifiable and can be
21

authenticated and is attached to or made part of
22

the license will comply with this requirement;
23

(ii) a license agreement in which the customer
24

electronically accepts the terms by clicking "I
25

agree" does not comply with this requirement;
26

(B) it restricts the customer's duplication and

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use of the software;
2

(C) it prohibits the customer from licensing,
3

sublicensing, or transferring the software to a third
4

party (except to a related party) without the
5

permission and continued control of the licensor;
6

(D) the licensor has a policy of providing another
7

copy at minimal or no charge if the customer loses or
8

damages the software, or of permitting the licensee to
9

make and keep an archival copy, and such policy is
10

either stated in the license agreement, supported by
11

the licensor's books and records, or supported by a
12

notarized statement made under penalties of perjury by
13

the licensor; and
14

(E) the customer must destroy or return all copies
15

of the software to the licensor at the end of the
16

license period; this provision is deemed to be met, in
17

the case of a perpetual license, without being set
18

forth in the license agreement; and
19

(2) property that is subject to a tax on lease
20

receipts imposed by a home rule unit of local government
21

if the ordinance imposing that tax was adopted prior to
22

January 1, 2023.
23

(40) Beginning on January 1, 2027, tangible personal
24
property that is purchased for the improvement of residential
25
or nonresidential real estate by the installation of a solar
26
energy system that is primarily used to provide electricity to

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the premises. This paragraph (40) applies to tangible personal
2
property that becomes a necessary part of the integrated solar
3
energy system, even if some of the tangible personal property
4
is not affixed to the real estate. For the purposes of this
5
paragraph (40), a solar energy system is considered to be
6
primarily used to provide electricity to the premises if the
7
solar energy system is used to offset the electricity load of
8
the end user, and the additional kilowatt-hours produced by
9
the system is not estimated to exceed by more than 110% the
10
kilowatt-hours of electricity consumed by the end user of
11
electricity at the meter in the last 12 full months before the
12
system is placed in service.
13

To qualify for the exemption under this paragraph (40),
14
the serviceman must complete, at the point of sale, a form
15
prescribed by the Department documenting that the transaction
16
is eligible for the exemption under this paragraph. The
17
serviceman must keep the form as documentation of the
18
exemption in the serviceman's records for a period of not less
19
than 6 years. This paragraph is exempt from the provisions of
20
Section 3-55.

21

As used in this paragraph (40):

22

"Solar energy system" means a complete assembly,
23
mechanism, or structure that uses solar energy for generating
24
electricity by means of photovoltaics. A solar energy system
25
consists of an integration of several components, including
26
solar panels to absorb and convert sunlight into electricity,

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a solar inverter to convert the output from direct to
2
alternating current, as well as mounting, cabling, and other
3
electrical accessories to set up a working system and the
4
necessary components, if any, of supplemental conventional
5
energy systems designed or constructed to interface with a
6
solar energy system.

7
(Source: P.A. 103-9, Article 5, Section 5-15, eff. 6-7-23;
8
103-9, Article 15, Section 15-15, eff. 6-7-23; 103-154, eff.
9
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
10
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
11
103-781, eff. 8-5-24; 103-995, eff. 8-9-24; 104-417, eff.
12
8-15-25.)

13

Section 20.
The Retailers' Occupation Tax Act is amended
14
by changing Section 2-5 as follows:

15

(35 ILCS 120/2-5)
16

Sec. 2-5.
Exemptions.
Gross receipts from proceeds from
17
the sale, which, on and after January 1, 2025, includes the
18
lease, of the following tangible personal property are exempt
19
from the tax imposed by this Act:
20

(1) Farm chemicals.
21

(2) Farm machinery and equipment, both new and used,
22

including that manufactured on special order, certified by
23

the purchaser to be used primarily for production
24

agriculture or State or federal agricultural programs,

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including individual replacement parts for the machinery
2

and equipment, including machinery and equipment purchased
3

for lease, and including implements of husbandry defined
4

in Section 1-130 of the Illinois Vehicle Code, farm
5

machinery and agricultural chemical and fertilizer
6

spreaders, and nurse wagons required to be registered
7

under Section 3-809 of the Illinois Vehicle Code, but
8

excluding other motor vehicles required to be registered
9

under the Illinois Vehicle Code. Horticultural polyhouses
10

or hoop houses used for propagating, growing, or
11

overwintering plants shall be considered farm machinery
12

and equipment under this item (2). Agricultural chemical
13

tender tanks and dry boxes shall include units sold
14

separately from a motor vehicle required to be licensed
15

and units sold mounted on a motor vehicle required to be
16

licensed, if the selling price of the tender is separately
17

stated.
18

Farm machinery and equipment shall include precision
19

farming equipment that is installed or purchased to be
20

installed on farm machinery and equipment including, but
21

not limited to, tractors, harvesters, sprayers, planters,
22

seeders, or spreaders. Precision farming equipment
23

includes, but is not limited to, soil testing sensors,
24

computers, monitors, software, global positioning and
25

mapping systems, and other such equipment.
26

Farm machinery and equipment also includes computers,

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sensors, software, and related equipment used primarily in
2

the computer-assisted operation of production agriculture
3

facilities, equipment, and activities such as, but not
4

limited to, the collection, monitoring, and correlation of
5

animal and crop data for the purpose of formulating animal
6

diets and agricultural chemicals.
7

Beginning on January 1, 2024, farm machinery and
8

equipment also includes electrical power generation
9

equipment used primarily for production agriculture.
10

This item (2) is exempt from the provisions of Section
11

2-70.
12

(3) Until July 1, 2003, distillation machinery and
13

equipment, sold as a unit or kit, assembled or installed
14

by the retailer, certified by the user to be used only for
15

the production of ethyl alcohol that will be used for
16

consumption as motor fuel or as a component of motor fuel
17

for the personal use of the user, and not subject to sale
18

or resale.
19

(4) Until July 1, 2003 and beginning again September
20

1, 2004 through August 30, 2014, graphic arts machinery
21

and equipment, including repair and replacement parts,
22

both new and used, and including that manufactured on
23

special order or purchased for lease, certified by the
24

purchaser to be used primarily for graphic arts
25

production. Equipment includes chemicals or chemicals
26

acting as catalysts but only if the chemicals or chemicals

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acting as catalysts effect a direct and immediate change
2

upon a graphic arts product. Beginning on July 1, 2017,
3

graphic arts machinery and equipment is included in the
4

manufacturing and assembling machinery and equipment
5

exemption under paragraph (14).
6

(5) A motor vehicle that is used for automobile
7

renting, as defined in the Automobile Renting Occupation
8

and Use Tax Act. This paragraph is exempt from the
9

provisions of Section 2-70.
10

(6) Personal property sold by a teacher-sponsored
11

student organization affiliated with an elementary or
12

secondary school located in Illinois.
13

(7) Until July 1, 2003, proceeds of that portion of
14

the selling price of a passenger car the sale of which is
15

subject to the Replacement Vehicle Tax.
16

(8) Personal property sold to an Illinois county fair
17

association for use in conducting, operating, or promoting
18

the county fair.
19

(9) Personal property sold to a not-for-profit arts or
20

cultural organization that establishes, by proof required
21

by the Department by rule, that it has received an
22

exemption under Section 501(c)(3) of the Internal Revenue
23

Code and that is organized and operated primarily for the
24

presentation or support of arts or cultural programming,
25

activities, or services. These organizations include, but
26

are not limited to, music and dramatic arts organizations

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such as symphony orchestras and theatrical groups, arts
2

and cultural service organizations, local arts councils,
3

visual arts organizations, and media arts organizations.
4

On and after July 1, 2001 (the effective date of Public Act
5

92-35), however, an entity otherwise eligible for this
6

exemption shall not make tax-free purchases unless it has
7

an active identification number issued by the Department.
8

(10) Personal property sold by a corporation, society,
9

association, foundation, institution, or organization,
10

other than a limited liability company, that is organized
11

and operated as a not-for-profit service enterprise for
12

the benefit of persons 65 years of age or older if the
13

personal property was not purchased by the enterprise for
14

the purpose of resale by the enterprise.
15

(11) Except as otherwise provided in this Section,
16

personal property sold to a governmental body, to a
17

corporation, society, association, foundation, or
18

institution organized and operated exclusively for
19

charitable, religious, or educational purposes, or to a
20

not-for-profit corporation, society, association,
21

foundation, institution, or organization that has no
22

compensated officers or employees and that is organized
23

and operated primarily for the recreation of persons 55
24

years of age or older. A limited liability company may
25

qualify for the exemption under this paragraph only if the
26

limited liability company is organized and operated

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exclusively for educational purposes. On and after July 1,
2

1987, however, no entity otherwise eligible for this
3

exemption shall make tax-free purchases unless it has an
4

active identification number issued by the Department.
5

(12) (Blank).
6

(12-5) On and after July 1, 2003 and through June 30,
7

2004, motor vehicles of the second division with a gross
8

vehicle weight in excess of 8,000 pounds that are subject
9

to the commercial distribution fee imposed under Section
10

3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
11

2004 and through June 30, 2005, the use in this State of
12

motor vehicles of the second division: (i) with a gross
13

vehicle weight rating in excess of 8,000 pounds; (ii) that
14

are subject to the commercial distribution fee imposed
15

under Section 3-815.1 of the Illinois Vehicle Code; and
16

(iii) that are primarily used for commercial purposes.
17

Through June 30, 2005, this exemption applies to repair
18

and replacement parts added after the initial purchase of
19

such a motor vehicle if that motor vehicle is used in a
20

manner that would qualify for the rolling stock exemption
21

otherwise provided for in this Act. For purposes of this
22

paragraph, "used for commercial purposes" means the
23

transportation of persons or property in furtherance of
24

any commercial or industrial enterprise whether for-hire
25

or not.
26

(13) Proceeds from sales to owners or lessors,

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lessees, or shippers of tangible personal property that is
2

utilized by interstate carriers for hire for use as
3

rolling stock moving in interstate commerce and equipment
4

operated by a telecommunications provider, licensed as a
5

common carrier by the Federal Communications Commission,
6

which is permanently installed in or affixed to aircraft
7

moving in interstate commerce.
8

(14) Machinery and equipment that will be used by the
9

purchaser, or a lessee of the purchaser, primarily in the
10

process of manufacturing or assembling tangible personal
11

property for wholesale or retail sale or lease, whether
12

the sale or lease is made directly by the manufacturer or
13

by some other person, whether the materials used in the
14

process are owned by the manufacturer or some other
15

person, or whether the sale or lease is made apart from or
16

as an incident to the seller's engaging in the service
17

occupation of producing machines, tools, dies, jigs,
18

patterns, gauges, or other similar items of no commercial
19

value on special order for a particular purchaser. The
20

exemption provided by this paragraph (14) does not include
21

machinery and equipment used in (i) the generation of
22

electricity for wholesale or retail sale; (ii) the
23

generation or treatment of natural or artificial gas for
24

wholesale or retail sale that is delivered to customers
25

through pipes, pipelines, or mains; or (iii) the treatment
26

of water for wholesale or retail sale that is delivered to

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customers through pipes, pipelines, or mains. The
2

provisions of Public Act 98-583 are declaratory of
3

existing law as to the meaning and scope of this
4

exemption. Beginning on July 1, 2017, the exemption
5

provided by this paragraph (14) includes, but is not
6

limited to, graphic arts machinery and equipment, as
7

defined in paragraph (4) of this Section.
8

(15) Proceeds of mandatory service charges separately
9

stated on customers' bills for purchase and consumption of
10

food and beverages, to the extent that the proceeds of the
11

service charge are in fact turned over as tips or as a
12

substitute for tips to the employees who participate
13

directly in preparing, serving, hosting or cleaning up the
14

food or beverage function with respect to which the
15

service charge is imposed.
16

(16) Tangible personal property sold to a purchaser if
17

the purchaser is exempt from use tax by operation of
18

federal law. This paragraph is exempt from the provisions
19

of Section 2-70.
20

(17) Tangible personal property sold to a common
21

carrier by rail or motor that receives the physical
22

possession of the property in Illinois and that transports
23

the property, or shares with another common carrier in the
24

transportation of the property, out of Illinois on a
25

standard uniform bill of lading showing the seller of the
26

property as the shipper or consignor of the property to a

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destination outside Illinois, for use outside Illinois.
2

(18) Legal tender, currency, medallions, or gold or
3

silver coinage issued by the State of Illinois, the
4

government of the United States of America, or the
5

government of any foreign country, and bullion.
6

(19) Until July 1, 2003, oil field exploration,
7

drilling, and production equipment, including (i) rigs and
8

parts of rigs, rotary rigs, cable tool rigs, and workover
9

rigs, (ii) pipe and tubular goods, including casing and
10

drill strings, (iii) pumps and pump-jack units, (iv)
11

storage tanks and flow lines, (v) any individual
12

replacement part for oil field exploration, drilling, and
13

production equipment, and (vi) machinery and equipment
14

purchased for lease; but excluding motor vehicles required
15

to be registered under the Illinois Vehicle Code.
16

(20) Photoprocessing machinery and equipment,
17

including repair and replacement parts, both new and used,
18

including that manufactured on special order, certified by
19

the purchaser to be used primarily for photoprocessing,
20

and including photoprocessing machinery and equipment
21

purchased for lease.
22

(21) Until July 1, 2028, coal and aggregate
23

exploration, mining, off-highway hauling, processing,
24

maintenance, and reclamation equipment, including
25

replacement parts and equipment, and including equipment
26

purchased for lease, but excluding motor vehicles required

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to be registered under the Illinois Vehicle Code. The
2

changes made to this Section by Public Act 97-767 apply on
3

and after July 1, 2003, but no claim for credit or refund
4

is allowed on or after August 16, 2013 (the effective date
5

of Public Act 98-456) for such taxes paid during the
6

period beginning July 1, 2003 and ending on August 16,
7

2013 (the effective date of Public Act 98-456).
8

(22) Until June 30, 2013, fuel and petroleum products
9

sold to or used by an air 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
12

flight destined for or returning from a location or
13

locations outside the United States without regard to
14

previous or subsequent domestic stopovers.
15

Beginning July 1, 2013, fuel and petroleum products
16

sold to or used by an air carrier, certified by the carrier
17

to be used for consumption, shipment, or storage in the
18

conduct of its business as an air common carrier, for a
19

flight that (i) is engaged in foreign trade or is engaged
20

in trade between the United States and any of its
21

possessions and (ii) transports at least one individual or
22

package for hire from the city of origination to the city
23

of final destination on the same aircraft, without regard
24

to a change in the flight number of that aircraft.
25

(23) A transaction in which the purchase order is
26

received by a florist who is located outside Illinois, but

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who has a florist located in Illinois deliver the property
2

to the purchaser or the purchaser's donee in Illinois.
3

(24) Fuel consumed or used in the operation of ships,
4

barges, or vessels that are used primarily in or for the
5

transportation of property or the conveyance of persons
6

for hire on rivers bordering on this State if the fuel is
7

delivered by the seller to the purchaser's barge, ship, or
8

vessel while it is afloat upon that bordering river.
9

(25) Except as provided in items (25-5) and (25-6) of
10

this Section, a motor vehicle sold in this State to a
11

nonresident even though the motor vehicle is delivered to
12

the nonresident in this State, if the motor vehicle is not
13

to be titled in this State, and if a drive-away permit is
14

issued to the motor vehicle as provided in Section 3-603
15

of the Illinois Vehicle Code or if the nonresident
16

purchaser has vehicle registration plates to transfer to
17

the motor vehicle upon returning to his or her home state.
18

The issuance of the drive-away permit or having the
19

out-of-state registration plates to be transferred is
20

prima facie evidence that the motor vehicle will not be
21

titled in this State.
22

(25-5) The exemption under item (25) does not apply if
23

the state in which the motor vehicle will be titled does
24

not allow a reciprocal exemption for a motor vehicle sold
25

and delivered in that state to an Illinois resident but
26

titled in Illinois. The tax collected under this Act on

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the sale of a motor vehicle in this State to a resident of
2

another state that does not allow a reciprocal exemption
3

shall be imposed at a rate equal to the state's rate of tax
4

on taxable property in the state in which the purchaser is
5

a resident, except that the tax shall not exceed the tax
6

that would otherwise be imposed under this Act. At the
7

time of the sale, the purchaser shall execute a statement,
8

signed under penalty of perjury, of his or her intent to
9

title the vehicle in the state in which the purchaser is a
10

resident within 30 days after the sale and of the fact of
11

the payment to the State of Illinois of tax in an amount
12

equivalent to the state's rate of tax on taxable property
13

in his or her state of residence and shall submit the
14

statement to the appropriate tax collection agency in his
15

or her state of residence. In addition, the retailer must
16

retain a signed copy of the statement in his or her
17

records. Nothing in this item shall be construed to
18

require the removal of the vehicle from this state
19

following the filing of an intent to title the vehicle in
20

the purchaser's state of residence if the purchaser titles
21

the vehicle in his or her state of residence within 30 days
22

after the date of sale. The tax collected under this Act in
23

accordance with this item (25-5) shall be proportionately
24

distributed as if the tax were collected at the 6.25%
25

general rate imposed under this Act.
26

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

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exemption under item (25) does not apply if the purchaser
2

is a limited liability company and a member of the limited
3

liability company is a resident of Illinois. This
4

presumption may be rebutted by other evidence, such as
5

evidence the motor vehicle is insured at a garaging or
6

storage address outside Illinois or other evidence of the
7

physical address at which the motor vehicle will be
8

permanently stored or garaged outside Illinois.
9

(25-7) Beginning on July 1, 2007, no tax is imposed
10

under this Act on the sale of an aircraft, as defined in
11

Section 3 of the Illinois Aeronautics Act, if all of the
12

following conditions are met:
13

(1) the aircraft leaves this State within 15 days
14

after the later of either the issuance of the final
15

billing for the sale of the aircraft, or the
16

authorized approval for return to service, completion
17

of the maintenance record entry, and completion of the
18

test flight and ground test for inspection, as
19

required by 14 CFR 91.407;
20

(2) the aircraft is not based or registered in
21

this State after the sale of the aircraft; and
22

(3) the seller retains in his or her books and
23

records and provides to the Department a signed and
24

dated certification from the purchaser, on a form
25

prescribed by the Department, certifying that the
26

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

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certificate must also include the name and address of
2

the purchaser, the address of the location where the
3

aircraft is to be titled or registered, the address of
4

the primary physical location of the aircraft, and
5

other information that the Department may reasonably
6

require.
7

For purposes of this item (25-7):
8

"Based in this State" means hangared, stored, or
9

otherwise used, excluding post-sale customizations as
10

defined in this Section, for 10 or more days in each
11

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

of the aircraft.
13

"Registered in this State" means an aircraft
14

registered with the Department of Transportation,
15

Aeronautics Division, or titled or registered with the
16

Federal Aviation Administration to an address located in
17

this State.
18

This paragraph (25-7) is exempt from the provisions of
19

Section 2-70.
20

(26) Semen used for artificial insemination of
21

livestock for direct agricultural production.
22

(27) Horses, or interests in horses, registered with
23

and meeting the requirements of any of the Arabian Horse
24

Club Registry of America, Appaloosa Horse Club, American
25

Quarter Horse Association, United States Trotting
26

Association, or Jockey Club, as appropriate, used for

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purposes of breeding or racing for prizes. This item (27)
2

is exempt from the provisions of Section 2-70, and the
3

exemption provided for under this item (27) applies for
4

all periods beginning May 30, 1995, but no claim for
5

credit or refund is allowed on or after January 1, 2008
6

(the effective date of Public Act 95-88) for such taxes
7

paid during the period beginning May 30, 2000 and ending
8

on January 1, 2008 (the effective date of Public Act
9

95-88).
10

(28) Computers and communications equipment utilized
11

for any hospital purpose and equipment used in the
12

diagnosis, analysis, or treatment of hospital patients
13

sold to a lessor who leases the equipment, under a lease of
14

one year or longer executed or in effect at the time of the
15

purchase, to a hospital that has been issued an active tax
16

exemption identification number by the Department under
17

Section 1g of this Act.
18

(29) Personal property sold to a lessor who leases the
19

property, under a lease of one year or longer executed or
20

in effect at the time of the purchase, to a governmental
21

body that has been issued an active tax exemption
22

identification number by the Department under Section 1g
23

of this Act.
24

(30) Beginning with taxable years ending on or after
25

December 31, 1995 and ending with taxable years ending on
26

or before December 31, 2004, personal property that is

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donated for disaster relief to be used in a State or
2

federally declared disaster area in Illinois or bordering
3

Illinois by a manufacturer or retailer that is registered
4

in this State to a corporation, society, association,
5

foundation, or institution that has been issued a sales
6

tax exemption identification number by the Department that
7

assists victims of the disaster who reside within the
8

declared disaster area.
9

(31) Beginning with taxable years ending on or after
10

December 31, 1995 and ending with taxable years ending on
11

or before December 31, 2004, personal property that is
12

used in the performance of infrastructure repairs in this
13

State, including, but not limited to, municipal roads and
14

streets, access roads, bridges, sidewalks, waste disposal
15

systems, water and sewer line extensions, water
16

distribution and purification facilities, storm water
17

drainage and retention facilities, and sewage treatment
18

facilities, resulting from a State or federally declared
19

disaster in Illinois or bordering Illinois when such
20

repairs are initiated on facilities located in the
21

declared disaster area within 6 months after the disaster.
22

(32) Beginning July 1, 1999, game or game birds sold
23

at a "game breeding and hunting preserve area" as that
24

term is used in the Wildlife Code. This paragraph is
25

exempt from the provisions of Section 2-70.
26

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

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Section 1-146 of the Illinois Vehicle Code, that is
2

donated to a corporation, limited liability company,
3

society, association, foundation, or institution that is
4

determined by the Department to be organized and operated
5

exclusively for educational purposes. For purposes of this
6

exemption, "a corporation, limited liability company,
7

society, association, foundation, or institution organized
8

and operated exclusively for educational purposes" means
9

all tax-supported public schools, private schools that
10

offer systematic instruction in useful branches of
11

learning by methods common to public schools and that
12

compare favorably in their scope and intensity with the
13

course of study presented in tax-supported schools, and
14

vocational or technical schools or institutes organized
15

and operated exclusively to provide a course of study of
16

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

(34) Beginning January 1, 2000, personal property,
21

including food, purchased through fundraising events for
22

the benefit of a public or private elementary or secondary
23

school, a group of those schools, or one or more school
24

districts if the events are sponsored by an entity
25

recognized by the school district that consists primarily
26

of volunteers and includes parents and teachers of the

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school children. This paragraph does not apply to
2

fundraising events (i) for the benefit of private home
3

instruction or (ii) for which the fundraising entity
4

purchases the personal property sold at the events from
5

another individual or entity that sold the property for
6

the purpose of resale by the fundraising entity and that
7

profits from the sale to the fundraising entity. This
8

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

(35) Beginning January 1, 2000 and through December
10

31, 2001, new or used automatic vending machines that
11

prepare and serve hot food and beverages, including
12

coffee, soup, and other items, and replacement parts for
13

these machines. Beginning January 1, 2002 and through June
14

30, 2003, machines and parts for machines used in
15

commercial, coin-operated amusement and vending business
16

if a use or occupation tax is paid on the gross receipts
17

derived from the use of the commercial, coin-operated
18

amusement and vending machines. This paragraph is exempt
19

from the provisions of Section 2-70.
20

(35-5) Beginning August 23, 2001 and through June 30,
21

2016, food for human consumption that is to be consumed
22

off the premises where it is sold (other than alcoholic
23

beverages, soft drinks, and food that has been prepared
24

for immediate consumption) and prescription and
25

nonprescription medicines, drugs, medical appliances, and
26

insulin, urine testing materials, syringes, and needles

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used by diabetics, for human use, when purchased for use
2

by a person receiving medical assistance under Article V
3

of the Illinois Public Aid Code who resides in a licensed
4

long-term care facility, as defined in the Nursing Home
5

Care Act, or a licensed facility as defined in the ID/DD
6

Community Care Act, the MC/DD Act, or the Specialized
7

Mental Health Rehabilitation Act of 2013.
8

(36) Beginning August 2, 2001, computers and
9

communications equipment utilized for any hospital purpose
10

and equipment used in the diagnosis, analysis, or
11

treatment of hospital patients sold to a lessor who leases
12

the equipment, under a lease of one year or longer
13

executed or in effect at the time of the purchase, to a
14

hospital that has been issued an active tax exemption
15

identification number by the Department under Section 1g
16

of this Act. This paragraph is exempt from the provisions
17

of Section 2-70.
18

(37) Beginning August 2, 2001, personal property sold
19

to a lessor who leases the property, under a lease of one
20

year or longer executed or in effect at the time of the
21

purchase, to a governmental body that has been issued an
22

active tax exemption identification number by the
23

Department under Section 1g of this Act. This paragraph is
24

exempt from the provisions of Section 2-70.
25

(38) Beginning on January 1, 2002 and through June 30,
26

2016, tangible personal property purchased from an

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Illinois retailer by a taxpayer engaged in centralized
2

purchasing activities in Illinois who will, upon receipt
3

of the property in Illinois, temporarily store the
4

property in Illinois (i) for the purpose of subsequently
5

transporting it outside this State for use or consumption
6

thereafter solely outside this State or (ii) for the
7

purpose of being processed, fabricated, or manufactured
8

into, attached to, or incorporated into other tangible
9

personal property to be transported outside this State and
10

thereafter used or consumed solely outside this State. The
11

Director of Revenue shall, pursuant to rules adopted in
12

accordance with the Illinois Administrative Procedure Act,
13

issue a permit to any taxpayer in good standing with the
14

Department who is eligible for the exemption under this
15

paragraph (38). The permit issued under this paragraph
16

(38) shall authorize the holder, to the extent and in the
17

manner specified in the rules adopted under this Act, to
18

purchase tangible personal property from a retailer exempt
19

from the taxes imposed by this Act. Taxpayers shall
20

maintain all necessary books and records to substantiate
21

the use and consumption of all such tangible personal
22

property outside of the State of Illinois.
23

(39) Beginning January 1, 2008, tangible personal
24

property used in the construction or maintenance of a
25

community water supply, as defined under Section 3.145 of
26

the Environmental Protection Act, that is operated by a

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not-for-profit corporation that holds a valid water supply
2

permit issued under Title IV of the Environmental
3

Protection Act. This paragraph is exempt from the
4

provisions of Section 2-70.
5

(40) Beginning January 1, 2010 and continuing through
6

December 31, 2029, materials, parts, equipment,
7

components, and furnishings incorporated into or upon an
8

aircraft as part of the modification, refurbishment,
9

completion, replacement, repair, or maintenance of the
10

aircraft. This exemption includes consumable supplies used
11

in the modification, refurbishment, completion,
12

replacement, repair, and maintenance of aircraft. However,
13

until January 1, 2024, this exemption excludes any
14

materials, parts, equipment, components, and consumable
15

supplies used in the modification, replacement, repair,
16

and maintenance of aircraft engines or power plants,
17

whether such engines or power plants are installed or
18

uninstalled upon any such aircraft. "Consumable supplies"
19

include, but are not limited to, adhesive, tape,
20

sandpaper, general purpose lubricants, cleaning solution,
21

latex gloves, and protective films.
22

Beginning January 1, 2010 and continuing through
23

December 31, 2023, this exemption applies only to the sale
24

of qualifying tangible personal property to persons who
25

modify, refurbish, complete, replace, or maintain an
26

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

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1

are empowered to operate an approved repair station by the
2

Federal Aviation Administration, (ii) have a Class IV
3

Rating, and (iii) conduct operations in accordance with
4

Part 145 of the Federal Aviation Regulations. The
5

exemption does not include aircraft operated by a
6

commercial air carrier providing scheduled passenger air
7

service pursuant to authority issued under Part 121 or
8

Part 129 of the Federal Aviation Regulations. From January
9

1, 2024 through December 31, 2029, this exemption applies
10

only to the sale of qualifying tangible personal property
11

to: (A) persons who modify, refurbish, complete, repair,
12

replace, or maintain aircraft and who (i) hold an Air
13

Agency Certificate and are empowered to operate an
14

approved repair station by the Federal Aviation
15

Administration, (ii) have a Class IV Rating, and (iii)
16

conduct operations in accordance with Part 145 of the
17

Federal Aviation Regulations; and (B) persons who engage
18

in the modification, replacement, repair, and maintenance
19

of aircraft engines or power plants without regard to
20

whether or not those persons meet the qualifications of
21

item (A).
22

The changes made to this paragraph (40) by Public Act
23

98-534 are declarative of existing law. It is the intent
24

of the General Assembly that the exemption under this
25

paragraph (40) applies continuously from January 1, 2010
26

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

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refund is allowed for taxes paid as a result of the
2

disallowance of this exemption on or after January 1, 2015
3

and prior to February 5, 2020 (the effective date of
4

Public Act 101-629).
5

(41) Tangible personal property sold to a
6

public-facilities corporation, as described in Section
7

11-65-10 of the Illinois Municipal Code, for purposes of
8

constructing or furnishing a municipal convention hall,
9

but only if the legal title to the municipal convention
10

hall is transferred to the municipality without any
11

further consideration by or on behalf of the municipality
12

at the time of the completion of the municipal convention
13

hall or upon the retirement or redemption of any bonds or
14

other debt instruments issued by the public-facilities
15

corporation in connection with the development of the
16

municipal convention hall. This exemption includes
17

existing public-facilities corporations as provided in
18

Section 11-65-25 of the Illinois Municipal Code. This
19

paragraph is exempt from the provisions of Section 2-70.
20

(42) Beginning January 1, 2017 and through December
21

31, 2026, menstrual pads, tampons, and menstrual cups.
22

(43) Merchandise that is subject to the Rental
23

Purchase Agreement Occupation and Use Tax. The purchaser
24

must certify that the item is purchased to be rented
25

subject to a rental-purchase agreement, as defined in the
26

Rental-Purchase Agreement Act, and provide proof of

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registration under the Rental Purchase Agreement
2

Occupation and Use Tax Act. This paragraph is exempt from
3

the provisions of Section 2-70.
4

(44) Qualified tangible personal property used in the
5

construction or operation of a data center that has been
6

granted a certificate of exemption by the Department of
7

Commerce and Economic Opportunity, whether that tangible
8

personal property is purchased by the owner, operator, or
9

tenant of the data center or by a contractor or
10

subcontractor of the owner, operator, or tenant. Data
11

centers that would have qualified for a certificate of
12

exemption prior to January 1, 2020 had Public Act 101-31
13

been in effect, may apply for and obtain an exemption for
14

subsequent purchases of computer equipment or enabling
15

software purchased or leased to upgrade, supplement, or
16

replace computer equipment or enabling software purchased
17

or leased in the original investment that would have
18

qualified.
19

The Department of Commerce and Economic Opportunity
20

shall grant a certificate of exemption under this item
21

(44) to qualified data centers as defined by Section
22

605-1025 of the Department of Commerce and Economic
23

Opportunity Law of the Civil Administrative Code of
24

Illinois.
25

For the purposes of this item (44):
26

"Data center" means a building or a series of

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1

buildings rehabilitated or constructed to house
2

working servers in one physical location or multiple
3

sites within the State of Illinois.
4

"Qualified tangible personal property" means:
5

electrical systems and equipment; climate control and
6

chilling equipment and systems; mechanical systems and
7

equipment; monitoring and secure systems; emergency
8

generators; hardware; computers; servers; data storage
9

devices; network connectivity equipment; racks;
10

cabinets; telecommunications cabling infrastructure;
11

raised floor systems; peripheral components or
12

systems; software; mechanical, electrical, or plumbing
13

systems; battery systems; cooling systems and towers;
14

temperature control systems; other cabling; and other
15

data center infrastructure equipment and systems
16

necessary to operate qualified tangible personal
17

property, including fixtures; and component parts of
18

any of the foregoing, including installation,
19

maintenance, repair, refurbishment, and replacement of
20

qualified tangible personal property to generate,
21

transform, transmit, distribute, or manage electricity
22

necessary to operate qualified tangible personal
23

property; and all other tangible personal property
24

that is essential to the operations of a computer data
25

center. The term "qualified tangible personal
26

property" also includes building materials physically

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incorporated into the qualifying data center. To
2

document the exemption allowed under this Section, the
3

retailer must obtain from the purchaser a copy of the
4

certificate of eligibility issued by the Department of
5

Commerce and Economic Opportunity.
6

This item (44) is exempt from the provisions of
7

Section 2-70.
8

(45) Beginning January 1, 2020 and through December
9

31, 2020, sales of tangible personal property made by a
10

marketplace seller over a marketplace for which tax is due
11

under this Act but for which use tax has been collected and
12

remitted to the Department by a marketplace facilitator
13

under Section 2d of the Use Tax Act are exempt from tax
14

under this Act. A marketplace seller claiming this
15

exemption shall maintain books and records demonstrating
16

that the use tax on such sales has been collected and
17

remitted by a marketplace facilitator. Marketplace sellers
18

that have properly remitted tax under this Act on such
19

sales may file a claim for credit as provided in Section 6
20

of this Act. No claim is allowed, however, for such taxes
21

for which a credit or refund has been issued to the
22

marketplace facilitator under the Use Tax Act, or for
23

which the marketplace facilitator has filed a claim for
24

credit or refund under the Use Tax Act.
25

(46) Beginning July 1, 2022, breast pumps, breast pump
26

collection and storage supplies, and breast pump kits.

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1

This item (46) is exempt from the provisions of Section
2

2-70. As used in this item (46):
3

"Breast pump" means an electrically controlled or
4

manually controlled pump device designed or marketed to be
5

used to express milk from a human breast during lactation,
6

including the pump device and any battery, AC adapter, or
7

other power supply unit that is used to power the pump
8

device and is packaged and sold with the pump device at the
9

time of sale.
10

"Breast pump collection and storage supplies" means
11

items of tangible personal property designed or marketed
12

to be used in conjunction with a breast pump to collect
13

milk expressed from a human breast and to store collected
14

milk until it is ready for consumption.
15

"Breast pump collection and storage supplies"
16

includes, but is not limited to: breast shields and breast
17

shield connectors; breast pump tubes and tubing adapters;
18

breast pump valves and membranes; backflow protectors and
19

backflow protector adaptors; bottles and bottle caps
20

specific to the operation of the breast pump; and breast
21

milk storage bags.
22

"Breast pump collection and storage supplies" does not
23

include: (1) bottles and bottle caps not specific to the
24

operation of the breast pump; (2) breast pump travel bags
25

and other similar carrying accessories, including ice
26

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

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cleaning supplies; (4) nursing bras, bra pads, breast
2

shells, and other similar products; and (5) creams,
3

ointments, and other similar products that relieve
4

breastfeeding-related symptoms or conditions of the
5

breasts or nipples, unless sold as part of a breast pump
6

kit that is pre-packaged by the breast pump manufacturer
7

or distributor.
8

"Breast pump kit" means a kit that: (1) contains no
9

more than a breast pump, breast pump collection and
10

storage supplies, a rechargeable battery for operating the
11

breast pump, a breastmilk cooler, bottle stands, ice
12

packs, and a breast pump carrying case; and (2) is
13

pre-packaged as a breast pump kit by the breast pump
14

manufacturer or distributor.
15

(47) Tangible personal property sold by or on behalf
16

of the State Treasurer pursuant to the Revised Uniform
17

Unclaimed Property Act. This item (47) is exempt from the
18

provisions of Section 2-70.
19

(48) Beginning on January 1, 2024, tangible personal
20

property purchased by an active duty member of the armed
21

forces of the United States who presents valid military
22

identification and purchases the property using a form of
23

payment where the federal government is the payor. The
24

member of the armed forces must complete, at the point of
25

sale, a form prescribed by the Department of Revenue
26

documenting that the transaction is eligible for the

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exemption under this paragraph. Retailers must keep the
2

form as documentation of the exemption in their records
3

for a period of not less than 6 years. "Armed forces of the
4

United States" means the United States Army, Navy, Air
5

Force, Space Force, Marine Corps, or Coast Guard. This
6

paragraph is exempt from the provisions of Section 2-70.
7

(49) Beginning July 1, 2024, home-delivered meals
8

provided to Medicare or Medicaid recipients when payment
9

is made by an intermediary, such as a Medicare
10

Administrative Contractor, a Managed Care Organization, or
11

a Medicare Advantage Organization, pursuant to a
12

government contract. This paragraph (49) is exempt from
13

the provisions of Section 2-70.
14

(50) Beginning on January 1, 2026, as further defined
15

in Section 2-10, food for human consumption that is to be
16

consumed off the premises where it is sold (other than
17

alcoholic beverages, food consisting of or infused with
18

adult use cannabis, soft drinks, candy, and food that has
19

been prepared for immediate consumption). This item (50)
20

is exempt from the provisions of Section 2-70.
21

(51) Gross receipts from the lease of the following
22

tangible personal property:
23

(1) computer software transferred subject to a
24

license that meets the following requirements:
25

(A) it is evidenced by a written agreement
26

signed by the licensor and the customer;

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(i) an electronic agreement in which the
2

customer accepts the license by means of an
3

electronic signature that is verifiable and
4

can be authenticated and is attached to or
5

made part of the license will comply with this
6

requirement;
7

(ii) a license agreement in which the
8

customer electronically accepts the terms by
9

clicking "I agree" does not comply with this
10

requirement;
11

(B) it restricts the customer's duplication
12

and use of the software;
13

(C) it prohibits the customer from licensing,
14

sublicensing, or transferring the software to a
15

third party (except to a related party) without
16

the permission and continued control of the
17

licensor;
18

(D) the licensor has a policy of providing
19

another copy at minimal or no charge if the
20

customer loses or damages the software, or of
21

permitting the licensee to make and keep an
22

archival copy, and such policy is either stated in
23

the license agreement, supported by the licensor's
24

books and records, or supported by a notarized
25

statement made under penalties of perjury by the
26

licensor; and

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(E) the customer must destroy or return all
2

copies of the software to the licensor at the end
3

of the license period; this provision is deemed to
4

be met, in the case of a perpetual license,
5

without being set forth in the license agreement;
6

and
7

(2) property that is subject to a tax on lease
8

receipts imposed by a home rule unit of local
9

government if the ordinance imposing that tax was
10

adopted prior to January 1, 2023.
11

(52) Beginning on January 1, 2027, tangible personal
12

property that is purchased for the improvement of
13

residential or nonresidential real estate by the
14

installation of a solar energy system that is primarily
15

used to provide electricity to the premises. This
16

paragraph (52) applies to tangible personal property that
17

becomes a necessary part of the integrated solar energy
18

system, even if some of the tangible personal property is
19

not affixed to the real estate. For the purposes of this
20

paragraph (52), a solar energy system is considered to be
21

primarily used to provide electricity to the premises if
22

the solar energy system is used to offset the electricity
23

load of the end user, and the additional kilowatt-hours
24

produced by the system is not estimated to exceed by more
25

than 110% the kilowatt-hours of electricity consumed by
26

the end user of electricity at the meter in the last 12

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full months before the system is placed in service.
2

To qualify for the exemption under this paragraph
3

(52), the retailer must complete, at the point of sale, a
4

form prescribed by the Department documenting that the
5

transaction is eligible for the exemption under this
6

paragraph. The retailer must keep the form as
7

documentation of the exemption in the retailer's records
8

for a period of not less than 6 years. This paragraph is
9

exempt from the provisions of Section 2-70.

10

As used in this paragraph (52):

11

"Solar energy system" means a complete assembly,
12

mechanism, or structure that uses solar energy for
13

generating electricity by means of photovoltaics. A solar
14

energy system consists of an integration of several
15

components, including solar panels to absorb and convert
16

sunlight into electricity, a solar inverter to convert the
17

output from direct to alternating current, as well as
18

mounting, cabling, and other electrical accessories to set
19

up a working system and the necessary components, if any,
20

of supplemental conventional energy systems designed or
21

constructed to interface with a solar energy system.

22
(Source: P.A. 103-9, Article 5, Section 5-20, eff. 6-7-23;
23
103-9, Article 15, Section 15-20, eff. 6-7-23; 103-154, eff.
24
6-30-23; 103-384, eff. 1-1-24; 103-592, eff. 1-1-25; 103-605,
25
eff. 7-1-24; 103-643, eff. 7-1-24; 103-746, eff. 1-1-25;
26
103-781, eff. 8-5-24; 103-995, eff. 8-9-24; 104-6, eff.

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6-16-25; 104-417, eff. 8-15-25.)

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