One of the most common sales tax questions, heard over and over from businesses providing products and services in Illinois is – What is this 8% tax in Chicago? That 8% tax is the Chicago Personal Property Lease Transaction Tax. The tax applies to personal property leases or rentals in Chicago, or to personal property rented from outside the city that will be used in Chicago. The Chicago Personal Property Lease Transaction Tax, often referred to as the CTT for short, is outlined in Chicago Municipal Code § 3-32-030(A)(B) and 3-32-020(O). The most obvious types of property subject to this 8% tax are car rentals or leases and the rental of other various types of personal property such as formal wear, textbooks, videos, and so on and so forth. The less obvious type of property subject to this tax is computer software. Yes, you read that correctly, this tax can apply to computer software. On September 1,2013, a ruling was passed that made it possible to tax software transfers that were not taxable under Illinois sales tax. The purpose of the ruling was to make sure transfers that may have previously been exempt under both city and state laws were now taxable under one or the other. Tax ruling #5 defines ways in which software sharing is considered a lease and qualifies it as a taxable event. Visit these websites to learn more about the CTT and Ruling # 5 For more information on leasing taxes, check out our SlideShare
What is this 8% tax in Chicago?
kristinkorpostax
May 16, 2014
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