Illinois Administrative Code
Title 86 - REVENUE
Part 140 - SERVICE OCCUPATION TAX
Subpart A - NATURE OF TAX
Section 140.126 - Taxation of Food, Drugs and Medical Appliances
Current through Register Vol. 48, No. 38, September 20, 2024
a) Food for human consumption which is sold or transferred by a serviceman as an incident to a sale of service is generally subject to the high rate of tax (6.25 %) if it is prepared for immediate consumption or is sold for consumption on the premises of the sale. However, effective January 1, 1993, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the Hospital Licensing Act or the Nursing Home Care Act shall be subject to tax at the rate of 1%. In addition, effective August 13, 1999, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), the 1% rate applies to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the Child Care Act of 1969. Effective July 1, 2010 and through December 31, 2011, the 1% rate shall also apply to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the MR/DD Community Care Act. Effective January 1, 2012, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), the 1% rate shall also apply to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the ID/DD Community Care Act. Effective June 28, 2011, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), the 1% rate shall also apply to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the Specialized Mental Health Rehabilitation Act of 2013. Effective July 29, 2015, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), the 1% rate shall also apply to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the MC/DD Act. Effective June 17, 2021, except for the period beginning July 1, 2022 and until July 1, 2023 as provided in Section 140.101(b)(1)(D), the 1% rate shall also apply to food prepared for immediate consumption and transferred incident to a sale of service by an entity licensed under the Assisted Living and Shared Housing Act or an entity that holds a permit issued pursuant to the Life Care Facilities Act. (See Section 3-10 of the Act)
b) Food for human consumption off the premises where sold, medicines, drugs and medical appliances.
c) If a serviceman purchases tangible personal property at retail from an unregistered out-of-State supplier that the serviceman does not transfer to service customers, but that the serviceman instead uses or consumes, the serviceman must self-assess Use Tax on that tangible personal property and remit Use Tax to the Department. The rate is 6.25% for general merchandise and 1% for food, drugs and medical appliances. (See Part 150, Use Tax.) Similarly, if a de minimis serviceman paying Use Tax (see Section 140.108) makes purchases of tangible personal property that the de minimis serviceman will transfer to service customers from suppliers who do not charge Illinois tax, the de minimis serviceman must register to self-assess and remit Use Tax directly to the Department. This would be the case, for example, when purchases were made from out-of-State suppliers not registered to collect Illinois tax.