What is an Illinois tax exempt form?


Quick Answer

An Illinois tax exempt form is a form that can be submitted to determine if a business or organization based in the state of Illinois qualifies for a particular type of tax exemption. Not-for-profit organizations classified as 501(c) do qualify for certain types of tax exemption but are still required to submit the proper paperwork to retain tax exempt status, according to Avalara.

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Full Answer

Approximately 2 million businesses in the United States are registered as 501(c) organizations that qualify for sales or property tax exemption, states Avalara. In order for a business to qualify for a state and federal sales tax exemption in Illinois, the business must either be run for charitable, educational, religious or governmental purposes exclusively, or it must be a not-for-profit organization for the arts, for cultural purposes or for the recreation of the elderly, according to Illinois Revenue Publications.

There are strict guidelines determining what a 501(c) is able to sell without being taxed. For a business in Illinois to qualify for property tax exemption, the property from which it operates must not be leased for profit. Some organizations that do charitable work do not qualify for tax exemption, including the American Legions and AmVets, states Illinois Revenue Publications.

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