Illinois Department of Revenue
 
 
Businesses
 
 
 
 
 

Exempt Organizations

 
 

Statutory Reference

35 ILCS 5/101 to 5/1701

Definition

The Illinois Income Tax is imposed on every exempt organization on its unrelated business taxable income as determined under Section 512 of the Internal Revenue Code, without any deduction for the tax imposed or the standard exemption.

Tax rate

Exempt organizations may be formed as either a corporation or a trust. Therefore, exempt organizations pay both regular income tax and the Personal Property Tax Replacement Income Tax (replacement tax), but the rates differ.

Use the Tax Rate Database to determine the income and replacement tax rates for the exempt corporation or trust.

Tax base

The starting point for the Illinois Exempt Organization Income and Replacement Tax Return is the unrelated business taxable income or loss after deducting income exempt from tax by reason of the United States or Illinois Constitutions, or by reason of law, statute or treaties of the United States, and adding back any Illinois income tax deducted on the federal return.

Filing requirements

You must file Form IL-990-T, Exempt Organization Income and Replacement Tax Return, if you are an organization exempt from federal income tax by reason of Section 501(a) of the Internal revenue Code (IRC) and earn or receive unrelated business taxable income as determined under IRC, Section 512, and

  • have net income as defined under the Illinois Income Tax Act (IITA); or
  • are a resident or qualified to do business in the state of Illinois and are required to file U.S. Form 990-T (regardless of net income or loss).

In general, Form IL-990-T is due on or before the 15th day of the 5th month following the close of the tax year. If you are an employee trust as described in IRC Section 401(a), you must file Form IL-990-T on or before the 15th day of the 4th month following the close of the tax year.

Automatic filing extension

We grant you an automatic six-month (seven-month for corporations) extension of time to file your exempt organization tax return. You are not required to file Form IL-505-B, Automatic Extension Payment, in order to obtain this automatic extension. However, if you expect tax to be due, you must use Form IL-505-B to pay any tentative tax due in order to avoid interest and penalty on tax not paid by the original due date of the return. An extension of time to file your Form IL-990-T does not extend the amount of time you have to pay your Illinois tax liability.

What if I need to correct or change my return?

If you need to correct or change your return after it has been filed, you must file Form IL-990-T-X, Amended Exempt Organization Income and Replacement Tax Return. Returns filed before the extended due date of the return are treated as your original return for all purposes.

For more information see Form IL-990-T-X Instructions. You should file Form IL-990-T-X only after you have filed a processable Illinois Income Tax return. You must file a separate Form IL-990-T-X for each tax year you wish to change.

Do not file another Form IL-990-T with “amended” figures to change your originally filed Form IL-990-T.

Use Form IL-843, Amended Return or Notice of Change in Income, for tax years prior to 12/31/2007.

 
 
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