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SB 2027

Radar; authorize limited use of by sheriffs.

2025 Regular Session Introduced by Michael McLendon

SB 2027 would curb nonresident and LLC vehicle purchase exemptions by imposing a rebuttable presumption of Illinois use tax and narrowing limousine exemptions.

Died In Committee
#highwaysandtransportation #judiciary #divisionb
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Bill Summary · SB 2027

SB 2027 — Summary (2025)

Status: Died in Committee (Introduced March 7, 2025)
Primary sponsor: Sen. Celina Villanueva
Companion bill: HB 4101
Subjects: Highways & Transportation; Judiciary (Division B); Revenue / Taxation

Main purpose

SB 2027 would amend several Illinois tax and vehicle statutes to limit certain multistate and nonresident exemptions for motor-vehicle purchases and to narrow rolling-stock exemptions for some limousine uses. The stated intent is to reduce abusive tax avoidance where vehicles (often purchased through limited liability companies or out-of-state entities) avoid Illinois use or privilege taxes.

Key provisions and changes

  • Amends multiple statutes, including:
    • Use Tax Act (35 ILCS 105 §§3‑55, 3‑61)
    • Service Use Tax Act; Service Occupation Tax Act; Retailers' Occupation Tax Act
    • Illinois Vehicle Code (625 ILCS 5/3‑1001)
  • Creates a new, express rebuttable presumption (subsection (h‑1.5) of the Use Tax Act) that a nonresident-purchase exemption for motor vehicles does not apply when:
    • The purchaser is a limited liability company (LLC) and
    • Any member of that LLC is an Illinois resident.
    • The purchaser/retailer may rebut that presumption with evidence (for example, proof the vehicle is primarily insured, stored, or garaged outside Illinois).
  • Narrows the rolling-stock exemption for limousines so it applies only to limousines that are not subject to the Transportation Network Providers Act (i.e., excludes limousines operating as transportation network providers).
  • Clarifies that the motor vehicle privilege tax does not apply when a vehicle is purchased for resale by a retailer registered under the Retailers' Occupation Tax Act.
  • The bill text as filed/ amended includes other multistate exemptions (aircraft, interstate carriers, temporary storage, etc.); some aircraft-related exemption language in the amendment is present but truncated in the available document.

Who is affected

  • Illinois residents who are members of LLCs that purchase vehicles through those entities (rebuttable presumption may subject such purchases to Illinois use tax).
  • Out‑of‑state purchasers who buy vehicles in Illinois through LLCs or other nonresident arrangements.
  • Motor vehicle retailers and dealerships (additional documentation and recordkeeping obligations; potential changes to collected tax amounts).
  • Limousine operators and transportation network providers (limits application of rolling-stock exemption).
  • Illinois Department of Revenue (administration, audits, and enforcement).
  • Potentially, buyers of aircraft or interstate carriers to the extent other multistate exemptions discussed are unchanged or clarified.

Procedural / timeline notes

  • Introduced in the Senate on Feb 6 / received March 7, 2025 (sponsor: Villanueva).
  • Senate Committee Amendment No. 1 was filed Feb 27, 2025.
  • Public hearing and testimony held May 22, 2025; left pending in committee.
  • Official bill status shown as “Died In Committee.” (The legislative action list provided contains inconsistent entries beyond May 2025 — readers should consult the official Illinois General Assembly website for the authoritative status and history.)

Expected impacts

  • Likely to increase Illinois tax revenue in situations where vehicle purchases via LLCs had been treated as nonresident transactions.
  • Adds compliance burden on dealers and purchasers to document residency, titling intentions, and proof of out‑of‑state use to rebut the presumption.
  • Narrows an exemption relied on by some limousine operators, potentially increasing tax liability for vehicles used in certain ride-for-hire arrangements.

NOTE: The amendment text provided is partially truncated for some sections (notably aircraft exemptions). For the full legislative text, fiscal note, and final status, consult the Illinois General Assembly bill page or the Secretary of the Senate records.

Compiled from official sources — confirm details with the bill’s official record.

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