Cigarette & Cigarette Use Taxes
Statutory Reference
Electronic Services
Illinois Licensed Cigarette Distributors or Manufacturers
Definition
The Cigarette Tax Act imposes a tax on the occupation of selling cigarettes at retail. Licensed distributors prepay the tax through the purchase of stamps, which are affixed to each cigarette package. The distributor collects the tax from the retailer at or before the time of sale.
The Cigarette Use Tax Act imposes a tax on the privilege of using cigarettes in Illinois. Most use tax is collected from out-of-state distributors who purchase and affix stamps to cigarette packages to sell in Illinois. When a private citizen (unlicensed individual) purchases unstamped cigarettes from a seller, that individual is liable for the cigarette use tax and must remit the tax directly to the department.
NOTE: Tobacco products (cigars, loose tobacco, etc.) have their own tax. (See "
Tobacco Products Tax.")
Tax Rate
Use the
“Tax Rate Finder” to locate the rate for both Cigarette Tax and Cigarette Use
Tax.
Allowable Deductions
- sales out-of-state;
- cigarettes returned to manufacturers;
- cigarettes lost through fire, theft, etc., that is supported by proper documentation;
- sales of cigarettes to residents incarcerated in penal institutions and to resident patients of state-operated mental health facilities that have been manufactured as part of a correctional industries program;
- sales to U.S. military personnel through officially recognized agencies physically located at military bases; and
- direct sales to U.S. veteran's hospitals.
Additional Registration, License fee and bonding requirements
In addition to filing
Form REG-1, Illinois Business Registration Application, distributors must pay a $250 annual fee and post a $2,500 bond for each location. You may also register using our
On-line Business Registration program.
A person that transports more than 2,000 (10 cartons) unstamped cigarettes that is not a distributor must obtain a single or multiple permit to transport cigarettes into or through Illinois. There is no fee for these permits. However, Form IDR-169, Application for Cigarette Transporter Permit, must be completed.
Local Taxes
Both home rule and non-home rule municipalities may impose a cigarette tax. However, a home rule municipality cannot enact a new cigarette tax after July 1, 1993, nor can an existing cigarette tax be levied if the home rule government imposes a municipal sales tax. The Department of Revenue does not collect locally imposed cigarette taxes.
Form/Filing & Payment Requirements
Returns
- Form RC-6, Cigarette Revenue Return (the in-state distributors return) is due monthly by the 15th day of the month following the end of the reporting period.
- Form RC-6-A, Out-of-state Cigarette Revenue Return, is due monthly by the 15th day of the month following the end of the reporting period.
- Form RC-25, Cigarette Importation Report, Distributors who affix stamps to cigarettes imported into the United States must file this form by the first business day of the month following the end of the reporting period.
- Form RC-1-A, Cigarette Tax Stamp Order-Invoice, Distributors who purchase stamps file this form as needed.
- Form RC-44, Cigarette Use Tax Return, Unlicensed individuals pay tax on unstamped cigarettes purchased from a seller by filing this form as needed, on a per-purchase basis, within 30 days of the purchase.
Electronic Filing
Beginning January 1, 2003, a taxpayer that has 30 or more transactions per month must file electronically or on magnetic media. For more information refer to the
Electronic Filing - Cigarette Returns booklet.
Electronic Payments
Beginning July 1, 2003, all cigarette revenue tax stamp purchases must be paid by
Electronic Funds Transfer (EFT) .
