TITLE: Illinois Remote Retailer Tax Amnesty Program: Key Dates, Rates, and Eligibility
Illinois Remote Retailer Tax Amnesty Program: What Out-of-State Sellers Need to Know
If you sell tangible personal property to Illinois customers from outside the state, you may have a limited opportunity to settle eligible Retailers’ Occupation Tax liabilities without related penalties and interest.
The Illinois Remote Retailer Tax Amnesty Program closes on 31 October 2026. It applies to qualifying out-of-state remote retailers, including international sellers based in the UK, European Union, Canada and Australia, as well as US LLC owners without an Illinois physical presence.
You must act quickly. Registration, MyTax Illinois activation, record preparation, application filing and payment all need to be completed before the deadline.
Check whether you qualify before the deadline
The programme runs from 1 August 2026 through 31 October 2026 under 35 ILCS 120/2-13, as added by P.A. 104-0006.
A qualifying remote retailer is a business that sells tangible personal property to customers in Illinois but has no physical presence in Illinois.
The amnesty covers:
- Sales made from 1 January 2021 through 30 June 2026.
- Illinois Retailers’ Occupation Tax, or ROT.
- ROT on items that must be titled or registered with a state agency.
- All locally imposed retailers’ occupation taxes administered by the Illinois Department of Revenue, or IDOR.
- The Chicago Home Rule Municipal Soft Drink ROT.
You must also meet the relevant Illinois sales threshold.
For calendar quarters ending after 1 January 2021 and on or before 31 December 2025, you qualify if either condition applied during the preceding four calendar quarters:
- At least $100,000 in annual gross receipts from sales of tangible personal property to Illinois purchasers; or
- At least 200 separate transactions with Illinois purchasers.
For calendar quarters beginning on or after 1 January 2026, only the $100,000 annual gross receipts test applies. Illinois removed the 200-transaction threshold from 1 January 2026.
Use the simplified rates to resolve historic gaps
The amnesty application uses simplified tax rates:
- 9% for general merchandise.
- 1.75% for items normally subject to the 1% State rate.
The 1.75% rate includes food for off-premises consumption, prescription and nonprescription medicines, drugs and medical appliances.
Keep records that identify sales qualifying for the 1.75% rate. Without those records, the sales are presumed to be subject to the 9% rate.
There is another important rule. If you collected tax at a rate higher than the simplified rate, you must report and pay the greater amount collected.
The benefit is significant. Qualifying participants can pay eligible tax liabilities with related penalties and interest waived. However, the programme does not remove every possible charge. The following are excluded from the waiver:
- Lien filing and lien release fees.
- Books and records penalties.
- Bad check penalties.
- Collection agency service fees.
- Penalties and interest on liabilities fully paid before the amnesty period.
- Penalties and interest on liabilities that do not qualify for amnesty.
Register with IDOR and activate MyTax Illinois now
You must be registered with IDOR and have an active MyTax Illinois logon before applying.
Registration processing usually takes one to two business days. Do not leave this step until 31 October.
The official Illinois Tax Amnesty page provides the registration and activation process. After registration, create or activate your MyTax Illinois account and confirm that you can access your Sales and Use Tax account.
To file the amnesty application:
- Log in to MyTax Illinois.
- Select your Sales/Use Tax account.
- Choose View more account options.
- Select Remote Retailer Amnesty Application.
- Enter the eligible periods and sales information.
- Submit the application electronically.
- Pay in full or request an approved repayment plan by 31 October 2026.
Paper returns do not qualify for amnesty relief. Once IDOR processes the application, the liability cannot be edited.
Compare the 9% rate with your actual Illinois exposure
The simplified rate may be easier than reconstructing every destination-based local rate. But you should still compare the options using your records.
Illinois has many local taxing jurisdictions. Your decision should consider:
- Where your Illinois customers were located.
- Whether your products were general merchandise or 1.75% qualifying items.
- Whether you collected tax at a higher rate.
- Whether your records can support the correct destination and product classification.
- Whether the simplified rate produces a lower or higher liability than your actual applicable local rates.
Do not automatically assume that 9% is the lowest result. Calculate the position before filing. The application is final once processed.
Example: UK Shopify seller with no Illinois presence
Imagine a UK-owned Shopify store selling directly to Illinois customers. It has no US inventory, staff or offices.
The store may have crossed the $100,000 Illinois threshold. It may also have collected only the state-level rate and never tracked the 1,200-plus local rates connected with Illinois customer destinations.
That is the type of historic compliance gap the amnesty is designed to address. The seller can assess the covered periods, apply the 9% simplified rate for general merchandise where appropriate, and seek waiver of related penalties and interest.
The seller must still provide accurate information and pay the resulting liability.
Example: Australian or Canadian seller with limited exposure
An Australian or Canadian brand may have sold off-marketplace into Illinois during only two of the covered years.
The business does not necessarily need to reopen every year from 2021. It can claim amnesty for the eligible periods it chooses to include, provided the relevant sales and liability qualify.
This makes period-by-period sales analysis essential.
Example: Seller holding Illinois inventory
A seller with Illinois inventory is different.
For example, a business holding FBA stock in an Illinois fulfilment centre is not a remote retailer for amnesty purposes. It should not treat this programme as the solution to its Illinois sales tax position.
Review your physical presence and inventory records separately before applying.
Choose payment or an approved repayment plan
You must pay the liability in full by 31 October 2026, or request and receive approval for a repayment plan by that date.
Available repayment terms are:
- 6 months.
- 12 months.
- 18 months.
- 24 months.
A repayment plan requires a down payment. Automatic monthly withdrawals begin on 1 December 2026. Interest accrues on the outstanding balance from 1 November 2026.
Complete the plan as agreed. If you do not complete it, the penalties and interest are not waived and the liability is recalculated without the simplified rate.
Keep filing after the amnesty
Amnesty does not replace ongoing Illinois registration and filing duties.
Beginning with returns for the July 2026 period, you must file and pay Illinois tax as required. Going forward, Illinois will continue to require out-of-state sellers to collect and remit tax on taxable sales into the state once the economic nexus threshold is met.
Do not fall back into non-compliance after the amnesty period ends.
Decide before 31 October 2026
The Illinois Remote Retailer Tax Amnesty Program is a defined, dated opportunity. It can reduce historic exposure for remote retailers that qualify, but it is not automatic and it does not fit every seller.
Businesses that moved quickly through the August opening window will have the most flexibility. Those leaving it late risk missing registration, account activation or payment deadlines that cannot be extended.
If you sell into Illinois without a physical presence, assess your position now. Confirm your nexus status, identify the covered periods, review product classification and destination data, then decide whether the simplified rates work in your favour.
The deadline is 31 October 2026. After that, the penalty and interest waiver closes.
