What exactly is nexus, and how does it impact my Illinois business income tax?
"Nexus" refers to a constitutional limitation on the power of a state. It simply means that an entity has sufficient connections with a state to be subject to taxation. If an entity conducts sufficient business within Illinois, then it will be subject to Illinois taxes imposed on net income unless it has no constitutional nexus. Only under certain narrow exceptions can an entity derive business income from Illinois and not have nexus for tax purposes. For more information see
86 Ill. Adm. Code, Section 100.9720.
