86 Ill. Adm. Code 130.2012 — Sales to Persons Who Lease Tangible Personal Property to Governmental Bodies

# Sales to Persons Who Lease Tangible Personal Property to Governmental Bodies

ADMINISTRATIVE CODE

TITLE 86: REVENUECHAPTER I: DEPARTMENT OF REVENUEPART 130 RETAILERS' OCCUPATION TAXSECTION 130.2012 SALES TO PERSONS WHO LEASE TANGIBLE PERSONAL PROPERTY TO GOVERNMENTAL BODIES

Section 130.2012 Sales to Persons Who Lease Tangible Personal Property to Governmental Bodies a) Effective January 1, 1996 through December 31, 2000, and on and after August 2, 2001, sales of tangible personal property to a lessor who leases that property to a governmental body are not subject to Retailers' Occupation Tax. [35 ILCS 120/2-5(37)] As noted in this subsection, the exemption is not available during the period January 1, 2001 through August 1, 2001 because it expired under the provisions of Section 2-70 of the Retailers' Occupation Tax Act [35 ILCS 120/2-70] and was not reinstated until August 2, 2001. The exemption is otherwise available, provided that: 1) the tangible personal property must be purchased for lease to a governmental body under a lease that has been executed or is in effect at the time of purchase; 2) the lease must be for a period of one year or longer; and 3) the lease must be to a governmental body that has an active tax exemption identification number issued by the Department under Section 1g of the Retailers' Occupation Tax Act (see Section 130.2007 of this Part). b) When this exemption may be properly claimed, the purchaser must give the seller a certification stating that the property is being purchased for lease to a governmental body, under a lease of one year or longer executed or in effect at the time of the purchase and containing all of the following:

1) The seller's name and address;

2) The purchaser's name and address;

3) A description of the tangible personal property being purchased;

4) The purchaser's signature and date of signing;

5) The name of the governmental body and its tax exemption identification number issued by the Department; and 6) The date the lease was executed and the lease period. c) On and after January 1, 2025, the exemption under this Section is rendered obsolete with respect to the purchase for lease of tangible personal property that is subject to the tax on leases as a result of the changes made in Article 75 of Public Act 103-592 which extends the Retailers' Occupation Tax to the taxation of leases. On and after January 1, 2025, purchases for lease of these items are tax-free purchases for resale. See Section 130.210(e). On and after January 1, 2025, the lease of these items to a governmental body that has an active sales tax exemption identification number in furtherance of the governmental body's purpose is exempt. [35 ILCS 120/2-5(11)] The exemption under this Section continues in effect, however, for the purchase for lease of motor vehicles, watercraft, aircraft, and semitrailers, as defined in Section 1-187 of the Illinois Vehicle Code, that are required to be registered with an agency of this State. (Source: Amended at 50 Ill. Reg. 1119, effective January 8, 2026)

Section 130.2012 Sales to Persons Who Lease Tangible Personal Property to Governmental Bodies

a) Effective January 1, 1996 through December 31, 2000, and on and after August 2, 2001, sales of tangible personal property to a lessor who leases that property to a governmental body are not subject to Retailers' Occupation Tax. [35 ILCS 120/2-5(37)] As noted in this subsection, the exemption is not available during the period January 1, 2001 through August 1, 2001 because it expired under the provisions of Section 2-70 of the Retailers' Occupation Tax Act [35 ILCS 120/2-70] and was not reinstated until August 2, 2001. The exemption is otherwise available, provided that:

1) the tangible personal property must be purchased for lease to a governmental body under a lease that has been executed or is in effect at the time of purchase;

2) the lease must be for a period of one year or longer; and

3) the lease must be to a governmental body that has an active tax exemption identification number issued by the Department under Section 1g of the Retailers' Occupation Tax Act (see Section 130.2007 of this Part).

b) When this exemption may be properly claimed, the purchaser must give the seller a certification stating that the property is being purchased for lease to a governmental body, under a lease of one year or longer executed or in effect at the time of the purchase and containing all of the following:

1) The seller's name and address;

2) The purchaser's name and address;

3) A description of the tangible personal property being purchased;

4) The purchaser's signature and date of signing;

5) The name of the governmental body and its tax exemption identification number issued by the Department; and

6) The date the lease was executed and the lease period.

c) On and after January 1, 2025, the exemption under this Section is rendered obsolete with respect to the purchase for lease of tangible personal property that is subject to the tax on leases as a result of the changes made in Article 75 of Public Act 103-592 which extends the Retailers' Occupation Tax to the taxation of leases. On and after January 1, 2025, purchases for lease of these items are tax-free purchases for resale. See Section 130.210(e). On and after January 1, 2025, the lease of these items to a governmental body that has an active sales tax exemption identification number in furtherance of the governmental body's purpose is exempt. [35 ILCS 120/2-5(11)] The exemption under this Section continues in effect, however, for the purchase for lease of motor vehicles, watercraft, aircraft, and semitrailers, as defined in Section 1-187 of the Illinois Vehicle Code, that are required to be registered with an agency of this State.

(Source: Amended at 50 Ill. Reg. 1119, effective January 8, 2026)