On June 16, 2025, the Illinois legislature enacted H.B. 2755 (Public Act 104-0006), which made significant taxpayer-friendly amendments to The Tax Delinquency Amnesty Act (TDAA) and The Retailers’ Occupational Tax (ROT) Act. Illinois has introduced a novel Remote Retailer Amnesty Program (RRAP) potentially saving Remote Retailers penalties and interest for missed state and local ROT filings and tax payments from prior years.
What You Need to Know:
- This fall, taxpayers may pay any outstanding Illinois tax due from any tax period ending after June 30, 2018 and before July 1, 2024, during the October 1, 2025 to November 17, 2025, TDAA amnesty period.
- Beginning next year, Remote Retailers may pay outstanding state or local ROT due from the period of January 1, 2021 through June 30, 2026, during the August 1, 2026 to October 31, 2026, RRAP amnesty period. Notably, Remote Retailers that cannot completely pay state and local ROT due may enter into a state approved repayment plan.
- Remote Retailers who can completely pay any Illinois state taxes (e.g., income, state and local ROT, etc.) due from any tax period ending after June 30, 2018 and before July 1, 2024, should consider making payment this year under the 2025 TDAA amnesty period since the RRAP amnesty period does not begin until the fall of 2026.
- Beginning on January 1, 2026, only out-of-state taxpayers with annual gross receipts of $100,000 or more from retail activities in Illinois, will be considered a Remote Retailer.
Amendments to The Tax Delinquency Amnesty Act
The Tax Delinquency Amnesty Act (TDAA) provides an amnesty program for taxpayers owing tax imposed under Illinois law and collected by the Illinois Department of Revenue (IDOR). The amendments to the TDAA generally provide that during the October 1, 2025 through November 17, 2025 amnesty period, the IDOR will abate and not collect interest or penalties, and will not seek civil or criminal prosecution for taxpayers who make full payment of any and all required Illinois tax attributable to any taxable period ending after June 30, 2018 and before July 1, 2024.
New Provision: The Remote Retailer Amnesty Program
The bill introduces a new Remote Retailer Amnesty Program (RRAP). This program allows Remote Retailers who owe state or local ROT on eligible transactions from the January 1, 2021 through June 30, 2026 eligibility period, to report and remit taxes at a simplified rate instead of the standard rate during the amnesty period of August 1, 2026, through October 31, 2026. The simplified tax rate is 9% of the gross receipts from sales of certain tangible personal property or 1.75% of the gross receipts from sales of certain tangible personal property and food items.
IDOR will abate interest and penalties and will not pursue civil or criminal prosecution during the amnesty period if Remote Retailers file all returns and remit all state and local ROT - or - enter into an approved repayment plan with IDOR during the amnesty period. To participate, Remote Retailers must be registered with IDOR and file returns electronically during the amnesty period.
General Definition of Remote Retailers
A Remote Retailer is defined as a retailer that does not have an office, place of business, or agents working on its behalf, in Illinois. However, a Remote Retailer is treated as maintaining a business in Illinois and is required to collect and remit state and local ROT if certain tax remittance thresholds are met. More specifically, beginning in January 1, 2021, through December 31, 2025, if a Remote Retailer (1) has cumulative gross receipts from sales to Illinois purchasers of $100,000, or (2) enters into 200 or more separate transactions for sales to Illinois purchasers, as calculated on a quarterly basis for the preceding 12-month period, then it is required to collect and remit state and local ROT. A Remote Retailer that meets the tax remittance threshold for all or part of the January 1, 2021, through June 30, 2026, eligibility period, may participate in the RRAP. Note that beginning on January 1, 2026, the “200 or more separate transactions” tax remittance threshold will no longer apply, leaving just the $100,000 gross receipts tax remittance threshold.
