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Are sales of maintenance agreements or warranty contracts taxable?

As part of a retail sale, charges for maintenance agreements or warranty contracts are taxable if they are included in the selling price of the tangible personal property but are not taxable if they are sold separately.

The seller of maintenance agreements and warranty contracts does incur use tax liability on the seller’s cost price of any tangible personal property transferred incident to the maintenance agreement. See 86 Ill. Adm. Code 140.301.

If you have additional inquiries, you may submit them on the Questions, Comments, or Requests form.