Tax Structure Reform for Car Leases
ILLINOIS– House Bill 2317 makes computing tax on car leases simpler starting the first of this year. Signed by Governor Pat Quinn last spring, the Illinois law will save lessees about 50% on their sales tax for leasing passenger cars, light trucks, recreation vehicles, and passenger vans. Under the new law lessees will only pay sales tax on the down payment of the car as well as the monthly payments. Previously, a lessee would also pay tax on the entire purchase price of the vehicle.
While the national average is 26%, Illinois residents trial the rest of the country in quantity of new-vehicle car leases. With Illinois residents only leasing 14% of their cars, Chicago is among the lowest leasing metros in the U.S.
Chicago Auto Trade Association is preparing to educate local car buyers about how the tax law change will help them to get more car for their money when leasing.
For sales/use tax compliance questions or audit related concerns, we are here to help!
Contact us at:
Or call today for an appointment:
972-488-5000