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Businesses

Sales of Aircraft & Watercraft by Lessors

Electronic Services

Definition

You are considered a retailer under the Retailers’ Occupation Tax Act if you are engaged in the business of leasing or renting aircraft or watercraft and you sell a used aircraft or watercraft in connection with your business to a purchaser who will use the aircraft or watercraft for his or her own use.

Tax Rate

Generally, the tax rate is 6.25%. Your rate may be higher if units of local government have imposed taxes.

Form/Filing Requirements

Contact our Central Registration Division at 1 217 785-3707 to properly register as a retailer of aircraft or watercraft and obtain the necessary ST-556 forms. The aircraft or watercraft cannot be registered until tax is paid or proof that the transaction is exempt from taxation is submitted. Aircraft is registered with the Illinois Department of Transportation - Division of Aeronautics. Watercraft is registered with the Illinois Department of Natural Resources.

Exemptions

Any transaction currently exempt under the Retailers’ Occupation Tax Act is an exempt transaction. You must be able to document the exempt sale. For more information, see the instructions for Form ST-556, Sales Tax Transaction Return, or Publication 104, Common Sales Tax Exemptions.

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