If you regularly use a parking garage, be prepared for the possibility of paying a little more after the first of the year.
Starting Jan. 1, parking area operators in the state of Illinois will be required to register with the Illinois Department of Revenue and begin collecting and tax on the rental of parking spaces.
According to an IDOR news release, the state wants to ensure that parking area operators are aware of their responsibility to ensure compliance with the new registration and tax requirement.
“Those who operate parking lots or garages will need to make sure they are properly registered with the state by Jan. 1,” said acting Director David Harris. “Revenue from this new program will go to rebuilding our state’s infrastructure and building a stronger economy. It is this department’s duty to help achieve compliance, so all taxpayers are treated fairly and consistently.”
Parking area operators can include those who rent spaces for parking or storing vehicles or provide valet services for a fee. There are exemptions for parking areas owned and operated by government entities or by hospitals for employees, residential off-street parking that is part of a lease agreement, or those renting fewer than four spots.
Revenue from the new requirements will go to vertical projects, like universities, early childhood centers and state facilities as part of the state’s Rebuild Illinois capital plan.
The plan will invest $45 billion in critical infrastructure projects all over the state and is projected to create 540,000 jobs over the life of the plan, according to the IDOR news release.
According to an article in the State Journal-Register, the tax is 9% on spaces that are rented by the month or by the year and 6% for spaces that are paid for on an hourly, daily or weekly basis.
The article said there is no tax on public spaces with on-street meters, nor parking lots and garages operated by cities, the federal government, state universities, counties and other units of local government.
Parking operators can register today with IDOR by visiting mytax.illinois.gov. To learn more about the requirements for both registration with the Department and for remitting the tax, read IDOR’s parking area operators Informational Bulletin FY2020-07 and Frequently Asked Questions (FAQs) located on IDOR’s website tax.illinois.gov.
SOURCE: state of Illinois news release