Generally speaking - and I think all states use the same terms here - "sales tax" is charged to the consumer by the seller, and then the seller remits the sales tax to the state. All sellers actually located within the state of Illinois are supposed to collect the sales tax on the sale of all items on which sales tax is assessed. Certain sales of certain items, e.g., food bought at a grocery store, are typically exempt from sales taxes
However, if an out of state vendor ships a "sales taxable" product into Illinois, that out of state vendor is not required to asses and charge sales tax. Instead, the Illinois resident is supposed to self-asses a "sales tax" which, in this instance, is called a "use tax."
So a "sales tax" and a "use tax" are exactly the same thing - a tax on the "consumer" of a product - and the only difference is who assesses the tax: if the seller assesses and collects it and remits it to the state it's a "sales tax", but if the buyer self-assesses it and remits it to the state, it's a "use tax."
Anyway, the Great State of Illinois, "Land of Lincoln", is asking you to work back through all you online purchases from out of state vendors, determine which of those purchases should be assessed a "use tax", and include that amount with your income tax liability. Of course if you determine that you have no out of state purchases then your use tax liability is $0.
Different states have taken different approaches to this issue. Some have come up with a self-assessment tables based on what they claim are "averages" of out of state purchases by state residents, divided up into taxable income groups. Others simply leave it up to you to figure it out.
As a very practical matter I expect that it's near-nigh impossible for any state to really "audit" this arrangement; at this point they are basically hoping that some of their citizens will kick a few dollars there way. Let your conscience be your guide.
Tom Young
Generally speaking - and I think all states use the same terms here - "sales tax" is charged to the consumer by the seller, and then the seller remits the sales tax to the state. All sellers actually located within the state of Illinois are supposed to collect the sales tax on the sale of all items on which sales tax is assessed. Certain sales of certain items, e.g., food bought at a grocery store, are typically exempt from sales taxes
However, if an out of state vendor ships a "sales taxable" product into Illinois, that out of state vendor is not required to asses and charge sales tax. Instead, the Illinois resident is supposed to self-asses a "sales tax" which, in this instance, is called a "use tax."
So a "sales tax" and a "use tax" are exactly the same thing - a tax on the "consumer" of a product - and the only difference is who assesses the tax: if the seller assesses and collects it and remits it to the state it's a "sales tax", but if the buyer self-assesses it and remits it to the state, it's a "use tax."
Anyway, the Great State of Illinois, "Land of Lincoln", is asking you to work back through all you online purchases from out of state vendors, determine which of those purchases should be assessed a "use tax", and include that amount with your income tax liability. Of course if you determine that you have no out of state purchases then your use tax liability is $0.
Different states have taken different approaches to this issue. Some have come up with a self-assessment tables based on what they claim are "averages" of out of state purchases by state residents, divided up into taxable income groups. Others simply leave it up to you to figure it out.
As a very practical matter I expect that it's near-nigh impossible for any state to really "audit" this arrangement; at this point they are basically hoping that some of their citizens will kick a few dollars there way. Let your conscience be your guide.
Tom Young