Effective January 1, 2026, Illinois will remove the “200 transaction” threshold from its economic nexus standard. After this date, remote sellers and marketplace facilitators will only be required to collect sales tax if they exceed $100,000 in gross receipts from Illinois sales in the preceding 12-month period. This change simplifies compliance and aligns Illinois with many other states.
Why This Matters for Remote Sellers and Marketplace Facilitators
If your business sells tangible goods or services to customers in Illinois from outside the state, this change could impact your tax collection obligations. Previously, economic nexus was triggered by either $100,000 in sales or 200 separate transactions. Now, only the sales threshold matters.
This is a big deal for small-to-medium-sized sellers and marketplace facilitators who may process many low-dollar transactions but fall short of $100,000 in revenue. Eliminating the transaction threshold reduces the risk of unexpectedly triggering nexus and having to register, collect, and remit tax in Illinois.
What’s Changing: Illinois Sales Tax Nexus Update for 2026
New Nexus Standard:
- Starting January 1, 2026, nexus for sales and use tax in Illinois will be based solely on gross receipts of $100,000 or more from sales to Illinois customers.
- The 200-transaction threshold will no longer apply.
Quarterly Check-Ins:
- Businesses will need to evaluate their gross receipts on a quarterly basis—at the end of March, June, September, and December.
- If a business exceeds the $100,000 threshold in the prior 12 months, it must register and collect Illinois sales tax the following year.
Who’s Impacted:
- Remote retailers
- Marketplace facilitators
- Marketplace sellers
- Servicemen making sales of service to Illinois customers from outside the state will also be subject to the same $100,000 threshold starting in 2026.
What to Do If You Sell to Illinois Customers
- Review your gross receipts from Illinois sales over the past 12 months. This includes all sales to Illinois customers, whether direct or through a marketplace.
- Remove transaction count from your nexus monitoring—it will no longer apply after December 31, 2025.
- If your business is close to or above the $100,000 mark, be prepared to register and collect Illinois sales tax beginning in 2026.
- Marketplace sellers: Check whether your marketplace facilitator is collecting on your behalf, and if so, confirm they’re aware of this rule change.
How TaxValet Simplifies Nexus Compliance in Illinois and Beyond
Keeping track of constantly evolving state tax laws can be a full-time job—but it doesn’t have to be yours. At TaxValet, we monitor nexus thresholds and compliance rules in every state for you. If this Illinois change affects your business, we’ll update your nexus strategy, ensure your registration is timely, and take care of accurate tax collection and remittance.
Reach out today for a free consultation to see how we can take sales tax off your plate—for good.