On May 29, 2014, the Illinois Department of Revenue submitted proposed final regulations regarding the sourcing of local sales tax. These regulations follow emergency regulations that were proposed in January and March 2014.
The regulations reflect guidance provided in the Illinois Supreme Court’s decision in Hartney Fuel Oil Co v. Hamer and provide direction to Illinois taxpayers regarding how sales should be sourced for local sales tax purposes.
Should the regulations be adopted in their current form, impacted taxpayers should review the implications of the state’s interpretation regarding how to source retail sales. The fact-intensive inquiry may alter the local sourcing of sales for certain taxpayers.