The tax imposed by the Act shall not apply to:
a)
Parking in a parking area or
garage operated by the federal government or its instrumentalities that has
been issued an active tax exemption number by the Department under Section 1g
of the Retailers' Occupation Tax Act [35 ILCS 120 ]. For this
exemption to apply, the parking area or garage must be operated by the federal
government or its instrumentalities. The exemption under this
subsection (a) does not apply if the parking area or garage is operated
by a third party, whether under a lease or other contractual arrangement, or
held in any other manner whatsoever (Section 10-20(1) of the
Act).
b)
Parking in a
parking area or garage operated by the State, a State university created by
statute, or a unit of local government (e.g., counties,
municipalities, townships, and special districts) that has been issued
an active tax exemption number by the Department under Section 1g of the
Retailers' Occupation Tax Act; for this exemption to apply, the parking area or
garage must be operated by the State, State university, or unit of local
government; the exemption under this subsection does not apply if the parking
area or garage is operated by a third party, whether under a lease or other
contractual arrangement, or held in any other manner, unless the parking area
or garage is exempt under subsection (k) (Section 10-20(6) of the
Act).
c)
Residential
off-street parking for home or apartment tenants or condominium occupants, if
the arrangement for that parking is provided in the home or apartment lease or
in a separate writing between the landlord and tenant, or in a condominium
agreement between the condominium association and the owner, occupant, or guest
of a unit, whether the parking charge is payable to the landlord, condominium
association, or the operator of the parking spaces (Section 10-20(2)
of the Act). The landlord, association or operator must maintain supporting
documentation to substantiate the claim. A list of residents or occupants
claiming the exemption maintained by the operator that has been reviewed and
approved by the landlord or association qualifies as supporting documentation.
EXAMPLE 1: A person enters into a residential lease agreement
with a landlord that requires the landlord to provide 2 parking spaces to the
tenant for $100 per month. The landlord has made arrangements with an operator
of a parking garage to make available 2 parking spaces to the tenant. The lease
requires the tenant to pay the $100 per month directly to the operator of the
garage. The operator is not required to collect tax from the tenant on the use
of the 2 parking spaces. The operator should obtain a copy of the lease and
maintain it in its books and records.
EXAMPLE 2: A tenant has a residential lease agreement that
requires the landlord, or a condominium owner is required by condominium bylaws
or documents, to provide parking spaces to the tenant or owner. The
tenant/owner is told by his or her landlord or condominium association that the
landlord or condominium association has an arrangement with a parking garage
operator to provide parking to the tenants/owners that desire parking. Based on
this arrangement, the tenant/owner enters into an agreement for parking with
the designated operator. The landlord or condominium association provides a
list of tenants/owners to the operator to verify their residency. The operator
can rely on that list to exempt the tenant/owner from paying the tax and the
operator from remitting the tax.
d)
Parking by hospital employees in a
parking space that is owned and operated by a public, private, or non-public
hospital for which they work (Section 10-20(3) of the Act). The
exemption under this subsection (d) does not apply if the parking area or
garage is operated by a third party, whether under a lease or other contractual
arrangement, or held in any other manner whatsoever.
e)
Parking in a parking area or
garage where 3 or fewer motor vehicles are stored, housed, or parked for hire,
charge, fee or other valuable consideration, if the operator of the parking
area or garage does not act as the operator of more than a total of 3 parking
spaces located in the State. If any operator of parking areas or garages,
including any facilitator or aggregator, acts as an operator of more than 3
parking spaces in total that are located in the State, then this exemption
shall not apply to any of those spaces (Section 10-20(4) of the Act).
EXAMPLE 1: Every year a carnival comes to a town. The owners of
property near the carnival sell parking spaces on their property for $10 per
day. If an owner of property makes available for use more than 3 parking
spaces, the owner is liable for collecting and remitting the tax.
EXAMPLE 2: A company near a baseball stadium contracts with
residents near the stadium to rent space in their driveways during game days.
Each resident enters into an agreement with the company to make available 3 or
fewer parking spaces. As a result of the agreements with the residents, the
company in, the aggregate, has 20 parking spaces to rent on game days. The
company charges a purchaser $30 for the rental of a parking space. The company
must register and remit tax at the rate of 6% of the $30 purchase price
received for the rental of a parking space. The company pays the residents $25
for each parking space that is rented by the company. Because the residents
rent 3 or fewer parking spaces, the residents are not required to register and
remit tax on the consideration received from the company.
EXAMPLE 3: The same facts as Example 2, except one resident
enters into an agreement with the company to make 4 parking spaces available
for rent. Because the resident is providing more than 3 parking spaces, the
resident is required to register and remit tax on the consideration received
from the rental of all 4 of the parking spaces. Because the resident does not
bill the company for the parking spaces and separately state and collect tax on
the $25, the company may not take a credit for the tax paid by the
resident.
f)
Parking
in a parking area or garage owned and operated by a person engaged in the
business of renting real estate if the parking area or garage is used by the
lessee to park motor vehicles, recreational vehicles, or self-propelled
vehicles for the lessee's own use and not for the purpose of subleasing parking
spaces for consideration (Section 10-20(7) of the Act). This person is
not engaged in the business of operating a parking area or garage.
EXAMPLE 1: A car dealership leases real estate from a person to
park the dealership's excess inventory. The lessor is not engaged in the
business of operating a parking area or garage.
EXAMPLE 2: A car dealership leases real estate from a person to
park motor vehicles for the purpose of making retail sales of the motor
vehicles. The lessor is not engaged in the business of operating a parking area
or garage.
EXAMPLE 3: A railroad company leases real estate to a
municipality. The municipality makes improvements on the property to permit
commuters to park their motor vehicles on the real estate. The railroad company
is not engaged in the business of operating a parking area or
garage.
g) A person that
makes
isolated or occasional sales of parking spaces subject to tax
under the Act and who does not hold himself or herself out as being engaged (or
who does not habitually engage) in selling of parking spaces (Section
10-5 of the Act).
EXAMPLE: A local promoter intends to hold a large concert on a
farm and requires plenty of parking spaces for the attendees. The promoter
leases a large field from a local farmer to park cars during the event. The
farmer has never leased his field in the past. The farmer is exempt from
collecting and remitting tax on the rental of his field to the
promoter.
h)
Any
transaction in interstate commerce, to the extent that the transaction may not,
under the Constitution and statutes of the United States, be made the subject
of taxation by this State (Section 10-10(e) of the Act).
i)
The purchase of a parking space by
the State, a State university created by statute, or a unit of local
government (e.g., counties, municipalities, townships, and special
districts) that has been issued an active tax exemption number by the
Department under Section 1g of the Retailers' Occupation Tax Act, for use by
employees of the State, State university, or unit of local government, provided
that the purchase price is paid directly by the governmental entity
(Section 10-20(8) of the Act).
j)
Parking in a parking space leased
to a governmental entity that is exempt pursuant to subsection (a) or
(b) when the exempt entity rents or leases the parking spaces in the
parking area or garage to the public; the purchase price must be paid by the
governmental entity; the exempt governmental entity is exempt from collecting
tax subject to the provisions of subsections (a) or (b), as
applicable, when renting or leasing the parking spaces to the public
(Section 10-20(9) of the Act). The purchase price must be paid by the
governmental entity (i.e., by check, debit card, credit card, or electronic
payment).
k)
For the
duration of the Illinois State Fair or the DuQuoin State Fair, parking in a
parking area or garage operated for the use of attendees, vendors, or employees
of the State Fair and not otherwise subject to taxation under this Act in the
ordinary course of business (Section 10-20(5) of the Act).
