1. Occupancy Taxes
Q: Are receipts from rentals to federal, state, and local government employees exempt from hotel tax?
No. Receipts from rooms rented to federal, state, and local government employees are not exempt
from hotel tax. Being government employees does not exempt these individuals from paying hotel tax.
Q: Are receipts from rentals to persons affiliated with schools or charitable, religious, or other not-for-profit organizations exempt from hotel tax?
No. Receipts from rooms rented to individuals associated with these groups are not exempt from hotel tax. Being associated with a school or not for- profit organization does not exempt these individuals from paying hotel tax.
Q: If a person or not-for-profit organization presents a tax exemption certificate issued by the Illinois Department of Revenue to me, are receipts from that rental exempt from hotel tax?
No. A tax exemption certificate issued by the Illinois Department of Revenue exempts certain entities from Illinois Sales Tax, not hotel tax.
2. Sales Tax
Sales to exempt organizations
In Illinois, only organizations that have applied for and received an exemption identification number (“E” number) from the Illinois Department of Revenue qualify as sales-tax exempt purchasers.
Examples of organizations that may qualify for tax exempt status include units of government, churches, charities, schools, county fair organizations, and certain senior citizen organizations. Once such organizations have been granted their “E” numbers, they may purchase items tax free to further their organizational purposes.
To document tax-exempt purchases from such organizations, retailers must request from the purchaser either a copy of the purchaser’s exemption letter issued by the department or the purchaser’s “E” number. (In this case, before completing the transaction, retailers should verify this number by calling the department at 217 782-8881).
For more detailed information about exempt organizations, see 86 Illinois Administrative Code 130.2005 and 130.2007, and Brochure PIO-37.