Illinois 2025-2026 Regular Session

Illinois Senate Bill SB2430 Compare Versions

Only one version of the bill is available at this time.

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1	1	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB2430 Introduced 2/7/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 35 ILCS 145/2 from Ch. 120, par. 481b.3235 ILCS 145/3 from Ch. 120, par. 481b.33 Amends the Hotel Operators' Occupation Tax Act. Provides that, beginning on January 2026, the tax under the Act is also imposed on short-term rentals. Provides that the tax shall be paid by the short-term rental unit provider, unless the short-term rental is secured through a short-term rental marketplace that meets certain thresholds. Effective immediately. LRB104 03189 HLH 13210 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB2430 Introduced 2/7/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 35 ILCS 145/2 from Ch. 120, par. 481b.3235 ILCS 145/3 from Ch. 120, par. 481b.33 35 ILCS 145/2 from Ch. 120, par. 481b.32 35 ILCS 145/3 from Ch. 120, par. 481b.33 Amends the Hotel Operators' Occupation Tax Act. Provides that, beginning on January 2026, the tax under the Act is also imposed on short-term rentals. Provides that the tax shall be paid by the short-term rental unit provider, unless the short-term rental is secured through a short-term rental marketplace that meets certain thresholds. Effective immediately. LRB104 03189 HLH 13210 b LRB104 03189 HLH 13210 b A BILL FOR
2	2	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB2430 Introduced 2/7/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 145/2 from Ch. 120, par. 481b.3235 ILCS 145/3 from Ch. 120, par. 481b.33 35 ILCS 145/2 from Ch. 120, par. 481b.32 35 ILCS 145/3 from Ch. 120, par. 481b.33
4	4	35 ILCS 145/2 from Ch. 120, par. 481b.32
5	5	35 ILCS 145/3 from Ch. 120, par. 481b.33
6	6	Amends the Hotel Operators' Occupation Tax Act. Provides that, beginning on January 2026, the tax under the Act is also imposed on short-term rentals. Provides that the tax shall be paid by the short-term rental unit provider, unless the short-term rental is secured through a short-term rental marketplace that meets certain thresholds. Effective immediately.
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9	9	A BILL FOR
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12	12	1 AN ACT concerning revenue.
13	13	2 Be it enacted by the People of the State of Illinois,
14	14	3 represented in the General Assembly:
15	15	4 Section 5. The Hotel Operators' Occupation Tax Act is
16	16	5 amended by changing Sections 2 and 3 as follows:
17	17	6 (35 ILCS 145/2) (from Ch. 120, par. 481b.32)
18	18	7 Sec. 2. Definitions. As used in this Act, unless the
19	19	8 context otherwise requires:
20	20	9 (1) "Hotel" means any building or buildings in which the
21	21	10 public may, for a consideration, obtain living quarters,
22	22	11 sleeping or housekeeping accommodations. The term includes,
23	23	12 but is not limited to, inns, motels, tourist homes or courts,
24	24	13 lodging houses, rooming houses and apartment houses, retreat
25	25	14 centers, conference centers, and hunting lodges. For the
26	26	15 purposes of re-renters of hotel rooms only, "hotel" does not
27	27	16 include a short-term rental.
28	28	17 (2) "Operator" means any person engaged in the business of
29	29	18 renting, leasing, or letting rooms in a hotel.
30	30	19 (3) "Occupancy" means the use or possession, or the right
31	31	20 to the use or possession, of any room or rooms in a hotel for
32	32	21 any purpose, or the right to the use or possession of the
33	33	22 furnishings or to the services and accommodations accompanying
34	34	23 the use and possession of the room or rooms.
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38	38	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB2430 Introduced 2/7/2025, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED:
39	39	35 ILCS 145/2 from Ch. 120, par. 481b.3235 ILCS 145/3 from Ch. 120, par. 481b.33 35 ILCS 145/2 from Ch. 120, par. 481b.32 35 ILCS 145/3 from Ch. 120, par. 481b.33
40	40	35 ILCS 145/2 from Ch. 120, par. 481b.32
41	41	35 ILCS 145/3 from Ch. 120, par. 481b.33
42	42	Amends the Hotel Operators' Occupation Tax Act. Provides that, beginning on January 2026, the tax under the Act is also imposed on short-term rentals. Provides that the tax shall be paid by the short-term rental unit provider, unless the short-term rental is secured through a short-term rental marketplace that meets certain thresholds. Effective immediately.
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45	45	A BILL FOR
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51	51	35 ILCS 145/2 from Ch. 120, par. 481b.32
52	52	35 ILCS 145/3 from Ch. 120, par. 481b.33
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71	71	1 (4) "Room" or "rooms" means any living quarters, sleeping
72	72	2 or housekeeping accommodations.
73	73	3 (5) "Permanent resident" means any person who occupied or
74	74	4 has the right to occupy any room or rooms, regardless of
75	75	5 whether or not it is the same room or rooms, in a hotel for at
76	76	6 least 30 consecutive days.
77	77	7 (6) "Rent" or "rental" means the consideration received
78	78	8 for occupancy, valued in money, whether received in money or
79	79	9 otherwise, including all receipts, cash, credits, and property
80	80	10 or services of any kind or nature. "Rent" or "rental" includes
81	81	11 any fee, charge, or commission received from a guest by a
82	82	12 re-renter of hotel rooms specifically in connection with the
83	83	13 re-rental of hotel rooms, but does not include any fee,
84	84	14 charge, or commission received from a short-term rental by a
85	85	15 hosting platform.
86	86	16 (7) "Department" means the Department of Revenue.
87	87	17 (8) "Person" means any natural individual, firm,
88	88	18 partnership, association, joint stock company, joint
89	89	19 adventure, public or private corporation, limited liability
90	90	20 company, or a receiver, executor, trustee, guardian, or other
91	91	21 representative appointed by order of any court.
92	92	22 (9) "Re-renter of hotel rooms" means a person who is not
93	93	23 employed by the hotel operator but who, either directly or
94	94	24 indirectly, through agreements or arrangements with third
95	95	25 parties, collects or processes the payment of rent for a hotel
96	96	26 room located in this State and (i) obtains the right or
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107	107	1 authority to grant control of, access to, or occupancy of a
108	108	2 hotel room in this State to a guest of the hotel or (ii)
109	109	3 facilitates the booking of a hotel room located in this State.
110	110	4 A person who obtains those rights or authorities is not
111	111	5 considered a re-renter of a hotel room if the person operates
112	112	6 under a shared hotel brand with the operator.
113	113	7 (10) "Hosting platform" or "platform" means a person who
114	114	8 provides an online application, software, website, or system
115	115	9 through which a short-term rental located in this State is
116	116	10 advertised or held out to the public as available to rent for
117	117	11 occupancy. For purposes of this definition, "short-term
118	118	12 rental" means an owner-occupied, tenant-occupied, or
119	119	13 non-owner-occupied dwelling, including, but not limited to, an
120	120	14 apartment, house, cottage, or condominium, located in this
121	121	15 State, where: (i) at least one room in the dwelling is rented
122	122	16 to an occupant for a period of less than 30 consecutive days;
123	123	17 and (ii) all accommodations are reserved in advance; provided,
124	124	18 however, that a dwelling shall be considered a single room if
125	125	19 rented as such.
126	126	20 (11) "Shared hotel brand" means an identifying trademark
127	127	21 that a hotel operator is expressly licensed to operate under
128	128	22 in accordance with the terms of a hotel franchise or
129	129	23 management agreement.
130	130	24 (12) "Residential dwelling" means a cabin, house, or
131	131	25 structure used or designed to be used as an abode or home of a
132	132	26 person, family, or household, and includes a single-family
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143	143	1 dwelling, a portion of a single-family dwelling, or an
144	144	2 individual residential dwelling in a multidwelling building,
145	145	3 such as an apartment building, condominium, cooperative, or
146	146	4 timeshare.
147	147	5 (13) "Short-term rental" means means a residential
148	148	6 dwelling that is rented wholly or partially for a fee for a
149	149	7 period of less than 30 continuous days.
150	150	8 (14) "Short-term rental marketplace" means any person or
151	151	9 entity that provides a platform for compensation through which
152	152	10 a third party offers to rent a short-term rental to an
153	153	11 occupant.
154	154	12 (15) "Short-term rental unit provider" means any person or
155	155	13 entity engaged in renting any short-term rental offered
156	156	14 through a short-term rental marketplace.
157	157	15 (Source: P.A. 103-592, eff. 7-1-24; revised 10-21-24.)
158	158	16 (35 ILCS 145/3) (from Ch. 120, par. 481b.33)
159	159	17 Sec. 3. Rate; exemptions.
160	160	18 (a) A tax is imposed upon hotel operators at the rate of 5%
161	161	19 of 94% of the gross rental receipts from engaging in business
162	162	20 as a hotel operator, excluding, however, from gross rental
163	163	21 receipts, the proceeds of renting, leasing or letting hotel
164	164	22 rooms to permanent residents of a hotel and proceeds from the
165	165	23 tax imposed under subsection (c) of Section 13 of the
166	166	24 Metropolitan Pier and Exposition Authority Act.
167	167	25 (b) There shall be imposed an additional tax upon hotel
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178	178	1 operators at the rate of 1% of 94% of the gross rental receipts
179	179	2 received by the hotel operator from engaging in business as a
180	180	3 hotel operator, excluding, however, from gross rental
181	181	4 receipts, the proceeds of such renting, leasing or letting to
182	182	5 permanent residents of that hotel and proceeds from the tax
183	183	6 imposed under subsection (c) of Section 13 of the Metropolitan
184	184	7 Pier and Exposition Authority Act.
185	185	8 (b-5) Beginning on July 1, 2024, if the renting, leasing,
186	186	9 or letting of a hotel room is done through a re-renter of hotel
187	187	10 rooms, then, subject to the provisions of Sections 3-2 and
188	188	11 3-3, the re-renter is the hotel operator for the purposes of
189	189	12 the taxes under subsections (a) and (b). If the re-renter is
190	190	13 headquartered outside of this State and has no presence in
191	191	14 this State other than its business as a re-renter, conducted
192	192	15 remotely, then, subject to the provisions of Sections 3-2 and
193	193	16 3-3, such re-renter is the hotel operator for the purposes of
194	194	17 the taxes under subsections (a) and (b) if it meets one of the
195	195	18 following thresholds:
196	196	19 (1) the cumulative gross receipts from rentals in
197	197	20 Illinois by the re-renter of hotel rooms are $100,000 or
198	198	21 more; or
199	199	22 (2) the re-renter of hotel rooms cumulatively enters
200	200	23 into 200 or more separate transactions for rentals in
201	201	24 Illinois.
202	202	25 A re-renter of hotel rooms who is headquartered outside of
203	203	26 this State and has no presence in this State other than its
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214	214	1 business as a re-renter, conducted remotely, shall determine
215	215	2 on a quarterly basis, ending on the last day of March, June,
216	216	3 September, and December, whether he or she meets the threshold
217	217	4 of either paragraph (1) or (2) of this subsection (b-5) for the
218	218	5 preceding 12-month period. If such re-renter of hotel rooms
219	219	6 meets the threshold of either paragraph (1) or (2) for a
220	220	7 12-month period, he or she is subject to tax under this Act and
221	221	8 is required to remit the tax imposed under this Act and file
222	222	9 returns for the 12-month period beginning on the first day of
223	223	10 the next month after he or she determines that he or she meets
224	224	11 the threshold of paragraph (1) or (2). At the end of that
225	225	12 12-month period, such re-renter of hotel rooms shall determine
226	226	13 whether he or she continued to meet the threshold of either
227	227	14 paragraph (1) or (2) during the preceding 12-month period. If
228	228	15 he or she met the threshold in either paragraph (1) or (2) for
229	229	16 the preceding 12-month period, he or she is a hotel operator in
230	230	17 this State and is required to remit the tax imposed under this
231	231	18 Act and file returns for the subsequent 12-month period. If,
232	232	19 at the end of a 12-month period during which such re-renter is
233	233	20 required to remit the tax imposed under this Act, the
234	234	21 re-renter determines that he or she did not meet the threshold
235	235	22 in either paragraph (1) or (2) during the preceding 12-month
236	236	23 period, he or she shall subsequently determine on a quarterly
237	237	24 basis, ending on the last day of March, June, September, and
238	238	25 December, whether he or she meets the threshold of either
239	239	26 paragraph (1) or (2) for the preceding 12-month period.
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250	250	1 (b-10) Notwithstanding any other provision of law,
251	251	2 beginning on January 2026, the tax under this Act is also
252	252	3 imposed on short-term rentals. The tax shall be paid by the
253	253	4 short-term rental unit provider, unless the short-term rental
254	254	5 is secured through a short-term rental marketplace that meets
255	255	6 the threshold set forth in this subsection. If the short-term
256	256	7 rental is secured through a short-term rental marketplace that
257	257	8 meets the threshold set forth in this subsection, then the
258	258	9 short-term rental marketplace shall collect and remit the tax
259	259	10 under this Act. The short-term rental marketplace shall
260	260	11 collect and remit the tax under this Act if:
261	261	12 (1) the cumulative gross receipts from rentals in
262	262	13 Illinois by the short-term rental marketplace is $100,000
263	263	14 or more; or
264	264	15 (2) the short-term rental marketplace cumulatively
265	265	16 enters into 200 or more separate transactions for
266	266	17 short-term rentals in Illinois.
267	267	18 (c) No funds received pursuant to this Act shall be used to
268	268	19 advertise for or otherwise promote new competition in the
269	269	20 hotel business.
270	270	21 (d) However, such tax is not imposed upon the privilege of
271	271	22 engaging in any business in Interstate Commerce or otherwise,
272	272	23 which business may not, under the Constitution and Statutes of
273	273	24 the United States, be made the subject of taxation by this
274	274	25 State. In addition, the tax is not imposed upon gross rental
275	275	26 receipts for which the hotel operator is prohibited from
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286	286	1 obtaining reimbursement for the tax from the customer by
287	287	2 reason of a federal treaty.
288	288	3 (d-5) On and after July 1, 2017, the tax imposed by this
289	289	4 Act shall not apply to gross rental receipts received by an
290	290	5 entity that is organized and operated exclusively for
291	291	6 religious purposes and possesses an active Exemption
292	292	7 Identification Number issued by the Department pursuant to the
293	293	8 Retailers' Occupation Tax Act when acting as a hotel operator
294	294	9 renting, leasing, or letting rooms:
295	295	10 (1) in furtherance of the purposes for which it is
296	296	11 organized; or
297	297	12 (2) to entities that (i) are organized and operated
298	298	13 exclusively for religious purposes, (ii) possess an active
299	299	14 Exemption Identification Number issued by the Department
300	300	15 pursuant to the Retailers' Occupation Tax Act, and (iii)
301	301	16 rent the rooms in furtherance of the purposes for which
302	302	17 they are organized.
303	303	18 No gross rental receipts are exempt under paragraph (2) of
304	304	19 this subsection (d-5) unless the hotel operator obtains the
305	305	20 active Exemption Identification Number from the exclusively
306	306	21 religious entity to whom it is renting and maintains that
307	307	22 number in its books and records. Gross rental receipts from
308	308	23 all rentals other than those described in items (1) or (2) of
309	309	24 this subsection (d-5) are subject to the tax imposed by this
310	310	25 Act unless otherwise exempt under this Act.
311	311	26 This subsection (d-5) is exempt from the sunset provisions
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322	322	1 of Section 3-5 of this Act.
323	323	2 (d-10) On and after July 1, 2023, the tax imposed by this
324	324	3 Act shall not apply to gross rental receipts received from the
325	325	4 renting, leasing, or letting of rooms to an entity that is
326	326	5 organized and operated exclusively by an organization
327	327	6 chartered by the United States Congress for the purpose of
328	328	7 providing disaster relief and that possesses an active
329	329	8 Exemption Identification Number issued by the Department
330	330	9 pursuant to the Retailers' Occupation Tax Act if the renting,
331	331	10 leasing, or letting of the rooms is in furtherance of the
332	332	11 purposes for which the exempt organization is organized. This
333	333	12 subsection (d-10) is exempt from the sunset provisions of
334	334	13 Section 3-5 of this Act.
335	335	14 (e) Persons subject to the tax imposed by this Act may
336	336	15 reimburse themselves for their tax liability under this Act by
337	337	16 separately stating such tax as an additional charge, which
338	338	17 charge may be stated in combination, in a single amount, with
339	339	18 any tax imposed pursuant to Sections 8-3-13 and 8-3-14 of the
340	340	19 Illinois Municipal Code, and Section 25.05-10 of "An Act to
341	341	20 revise the law in relation to counties".
342	342	21 (f) If any hotel operator collects an amount (however
343	343	22 designated) which purports to reimburse such operator for
344	344	23 hotel operators' occupation tax liability measured by receipts
345	345	24 which are not subject to hotel operators' occupation tax, or
346	346	25 if any hotel operator, in collecting an amount (however
347	347	26 designated) which purports to reimburse such operator for
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358	358	1 hotel operators' occupation tax liability measured by receipts
359	359	2 which are subject to tax under this Act, collects more from the
360	360	3 guest or re-renter than the operators' hotel operators'
361	361	4 occupation tax liability in the transaction is, the guest or
362	362	5 re-renter, as applicable, shall have a legal right to claim a
363	363	6 refund of such amount from such operator. However, if such
364	364	7 amount is not refunded to the guest or re-renter, as
365	365	8 applicable, for any reason, the hotel operator is liable to
366	366	9 pay such amount to the Department.
367	367	10 (Source: P.A. 103-9, eff. 6-7-23; 103-592, eff. 7-1-24.)
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