Illinois Administrative Code
Title 86 - REVENUE
Part 140 - SERVICE OCCUPATION TAX
Subpart A - NATURE OF TAX
Section 140.110 - Example of Methods Used by Servicemen to Determine Liability
Current through Register Vol. 48, No. 38, September 20, 2024
An auto mechanic contracts to repair a customer's automobile. In this example, the serviceman's entire bill to the customer is $500. Labor costs account for $300 of the total, and the serviceman's cost price of parts transferred totals $100. The selling price of the parts, if separately stated, would be $200. The following chart represents the manner in which this serviceman might incur tax under the different methods discussed in Sections 140.106, 140.108 and 140.109.
a) Registered Serviceman
|
Cost Price |
Selling Price |
Gross Receipts |
Service Occupation Tax Base |
|
|
Separately Stated |
$100 |
$200 |
$500 |
$200 (Selling price) |
|
Not Separately Stated |
$100 |
-0- |
$500 |
$250 (1/2 of gross receipts) |
|
De Minimis (paying SOT on cost price) |
$100 |
$200 |
$500 |
$100 (Cost price) |
b) De minimis serviceman not required to be registered as a retailer under Section 2a of the Retailers' Occupation Tax Act.
|
Cost Price |
Selling Price |
Gross Receipts |
Service Occupation Tax Base |
|
$100 |
$200 |
$500 |
** |
** (Not subject to Service Occupation Tax if not required to be registered as a retailer under Section 2a of the Retailers' Occupation Tax Act. Subject instead to Use Tax on $100, see Section 140.108.)
