From January 1, 2026, remote sellers must register and collect Illinois tax once their sales into Illinois reach $100,000 in the preceding 12 months. The old 200-transaction test is gone, sales through marketplaces that collect for you don’t count, and SaaS is not taxed at the state level, though Chicago taxes it.
Illinois at a glance
- Economic nexus threshold: $100,000
- Measured over: Preceding 12 months, checked quarterly
- Notes: Transaction test removed January 1, 2026; sales through marketplaces that collect are excluded
Checked against state guidance in October 2026. Compare every state
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Check your Illinois sales tax nexus
Enter your sales and number of orders into each state for the period that state measures (usually the current or previous calendar year). The checker compares them with each state’s economic nexus threshold.
Thresholds last reviewed September 2026. States define includable sales differently (gross, retail or taxable), some count marketplace sales and some do not, and a physical presence such as inventory or staff creates nexus on its own. Results are estimates for general information only, not legal, tax or financial advice. Confirm them with your own CPA, tax adviser or attorney before making decisions. Using this tool does not create a client relationship with Catching Numbers Inc.
Do Amazon, Etsy and other marketplace sales count toward the Illinois threshold?
No. Sales made through a marketplace facilitator that collects Illinois tax for you don’t count toward your own $100,000 threshold. Count your website, wholesale-to-retail and other direct sales into Illinois.
When do I have to register and start collecting?
Illinois uses a 12-month lookback, checked every quarter. At the end of each quarter, add up your Illinois sales for the previous 12 months; if they reach $100,000, register and start collecting. Since January 1, 2026, the number of transactions no longer matters.
How do I register for Illinois sales tax?
Register online through MyTax Illinois with the Illinois Department of Revenue. There is no fee.
What rate do I charge Illinois customers?
The state rate is 6.25%, plus the local taxes where the order is delivered. Remote sellers collect state and local tax at the rate for the delivery address, and combined rates in the Chicago area run above 10%.
Is SaaS taxable in Illinois?
Not at the state level, when customers only access the software in the cloud and nothing is downloaded. Chicago is different: its Personal Property Lease Transaction Tax applies to cloud software and SaaS used in the city, at 15% since January 1, 2026. If you sell software to Chicago customers, check whether you need to register with the City.
Is shipping taxable in Illinois?
Usually yes. When delivery is part of the deal, shipping and handling charges are taxable along with the item. They can be left out only when the customer had a real option to pick up the goods and agreed to delivery separately. Illinois calls this the “inseparable link” test.
Do I owe Illinois income tax as a remote seller?
Illinois has no bright-line economic nexus test for income tax; it depends on your activities there. Corporations that have nexus pay 7% income tax plus 2.5% replacement tax, and partnerships and S corporations pay a 1.5% replacement tax.
Sellers of physical goods may be protected from state income tax by a federal law, P.L. 86-272, if their only activity in the state is soliciting orders that ship from outside it. That protection does not cover SaaS, services or digital products. Check your position with our state income tax nexus checker.
What if I store inventory in Illinois, including Amazon FBA?
Inventory stored in Illinois, including in an Amazon FBA or other marketplace warehouse, gives you a physical presence there. Physical presence creates sales tax nexus on its own, whatever your sales total, so you would generally need to register even below the economic threshold.
Frequently asked questions
What is the Illinois economic nexus threshold for 2026 and 2027?
$100,000 of gross receipts from sales of goods to Illinois customers in the preceding 12 months, checked quarterly. The 200-transaction test was removed on January 1, 2026. No change has been announced for 2027 as of October 2026.
I had 200 small orders into Illinois but under $100,000. Do I need to collect?
Not since January 1, 2026, if your only connection is sales. Below $100,000 of Illinois sales in the lookback period, a remote seller without a physical presence doesn’t need to collect Illinois tax.
What is the Chicago cloud tax rate?
Chicago’s Personal Property Lease Transaction Tax on cloud software and SaaS is 15% from January 1, 2026, up from 11% in 2025.
Is Illinois sales tax destination-based for online sellers?
Yes. Remote sellers collect the state rate plus the local rate for the address where the order is delivered.
Selling into Illinois and other states?
We track your sales by state every month as part of your bookkeeping, so you see a threshold coming before you cross it, and your books show exactly what you collected and owe.
General information for remote sellers, checked against state guidance in October 2026. Illinois rules change and depend on your facts, so confirm your situation with the state or a sales tax advisor before registering or filing. We don’t prepare sales or income tax returns.