Guide

How much sales tax to charge in Chicago

Since August 1, 2026, the combined sales tax on most items sold in Chicago is 10.5%. Here is where that comes from and how to be sure you are charging the right amount.

General information only, not legal or tax advice. I am not a lawyer, a CPA or an accountant. Flipfiled does not prepare tax returns or give legal advice. This page explains what government sources say. Rules, rates and fees change, so confirm with the agency. The dollar examples are made up to show the math.

The short version

• Since August 1, 2026, general merchandise sold at most Chicago addresses is taxed at a combined 10.5%.
• That rate comes from stacked layers: state, Cook County, the City of Chicago and a regional transit tax. The transit layer went up by 0.25 percentage point on August 1.
• Rates depend on the address of the sale and the type of item. Always confirm with the state’s Tax Rate Finder (opens in a new tab).
• When you buy inventory to resell, you do not pay this tax if you give your supplier a valid resale certificate. See CRT-61.

What changed on August 1, 2026

The Illinois Department of Revenue (IDOR) announced in Informational Bulletin FY 2026-34 that on August 1, 2026 the transit authority tax rises by 0.25%. The transit authority is now called the Northern Illinois Transit Authority (NITA; it was the Regional Transportation Authority). The increase applies in Cook, DuPage, Kane, Lake, McHenry and Will counties. In Cook County the new transit rates are:

Source: IDOR Informational Bulletin FY 2026-34 (opens in a new tab).

How the 10.5% adds up

Local taxes stack on top of the state rate. For general merchandise in the City of Chicago, this site’s sales tax registration guide lists the layers as 6.25% state, 1.75% Cook County, 1.25% City of Chicago and 1.25% transit, which total 10.5%. The bulletin confirms the 1.25% transit layer. IDOR’s own ROT page says local taxes are added to the state rate, that the actual rate may be higher than the basic state rate depending on where the sale happens, and that local rates generally change on January 1 and July 1. For these reasons, treat a lookup of your exact address as the final word.

How to find your rate

1. Open the Illinois Tax Rate Finder (opens in a new tab) (IDOR’s MyTax Illinois tool).
2. Enter the address of the sale. For online sales that ship to customers, the rules are different. See sales tax across state lines.
3. Choose the right rate period. The bulletin tells retailers to choose August 2026 rates.
4. Check which rate applies to what you sell. Most resale items are general merchandise.
5. Put the rate in your point-of-sale system or marketplace settings. IDOR says to update your register or software “so you are collecting the correct rate starting August 1, 2026.” If a vendor runs your software, ask them to confirm.

Example

A customer buys a $40 jacket at your Chicago pop-up. This is invented math using the 10.5% rate:

The $4.20 is not your income. It belongs to the state, and you report and pay it on your sales tax return. See why compliance matters and how to file the ST-1.

If you were paid after August 1 for an earlier sale

The bulletin says that if you receive payment on or after August 1 for a sale that was taxed at the earlier rate, you report it on ST-1 Line 8a, with the tax on Line 8b, and those lines are for receivables at a previous rate only.

Things that can change the rate

• The type of item. The bulletin lists separate rates for general merchandise, qualifying groceries and drugs, and titled or registered items (like vehicles). If your inventory includes anything unusual, ask IDOR.
• The location of the sale. Different Illinois places have different layers.
• Resale. IDOR says a sale for resale is not subject to the Retailers’ Occupation Tax or use tax if the buyer has an active registration or resale number and gives the seller a certification. See IDOR: Retailers’ Occupation Tax (opens in a new tab).
• Marketplaces. IDOR says marketplace facilitators that meet the thresholds collect and remit on sales made on behalf of marketplace sellers, at the rate in effect at the buyer’s location. How that affects your own return is covered in sales tax across state lines and the platform comparison.

I did not confirm whether sales tax applies to shipping charges. Ask IDOR before assuming either way.

Questions for IDOR or a CPA

• Is every item I sell general merchandise?
• How should my marketplace sales and in-person sales be separated on my return?
• Do I charge tax on shipping?

I am not a CPA or an attorney

This page is general information, not legal or tax advice. Rates and rules change. Check the Tax Rate Finder for your exact address. Checked Oct 30, 2026.

Sources: IDOR Informational Bulletin FY 2026-34 (opens in a new tab); IDOR: Retailers’ Occupation Tax (opens in a new tab); IDOR Tax Rate Finder (opens in a new tab). News and tax-service sites report the same 10.5% total for Chicago; I could not open an IDOR page that itemizes every layer, which is why the Rate Finder is the final check.