According to Illinois Department of Revenue and Secretary of State websites, Chicago residents are required to pay Illinois sales tax, the new updated municipal use tax, and the Cook County use tax all at once prior to receiving new titles and license plates for vehicle purchases from private party transactions.
Prior to July 1, Chicago residents were only required to pay state sales tax on private party vehicle purchases in order to receive new license plates and a new title. Afterwards, Cook County would send notices to residents of taxes still owed to the County. Chicago residents were required to submit tax returns to the Chicago comptroller’s office. Now, Chicago and Cook County residents will pay those taxes upfront if they wish to acquire license plates and new titles for non-retail purchased vehicles.
According to instructions provided by the Illinois Department of Revenue, only Chicago and Cook County residents will be subject to this change in procedure. Surrounding counties, such as Will and DuPage, will only pay the required state sales tax prior to purchasing license plates and new titles.
Residents of Chicago will also see an increase in their municipal taxes on non-retail vehicle purchases. The highest increase of use tax is on 2007 model vehicles. Prior to July 1, a 2007 model vehicle levied a tax of just $10. After July 1, a 2007 model vehicle will levy a tax of $65. The only dip in tax occurs in 1999 model vehicle and older purchases. Before the new tax rates took effect, purchasers of these older model vehicles paid $10 in taxes. According to the Illinois RUT-7 instructions, taxes are no longer owed on those vehicles.
Residents of Chicago will also see an increase in their municipal taxes on non-retail vehicle purchases. The highest increase of use tax is on 2007 model vehicles. Prior to July 1, a 2007 model vehicle levied a tax of just $10. After July 1, a 2007 model vehicle will levy a tax of $65. The only dip in tax occurs in 1999 model vehicle and older purchases. Before the new tax rates took effect, purchasers of these older model vehicles paid $10 in taxes. According to the Illinois RUT-7 instructions, taxes are no longer owed on those vehicles.
NEW CHICAGO USE TAX STARTING JULY 1STVisit the Illinois Department of Revenue’s website here for more information regarding the tax rates on non-retail vehicle purchases.