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We have a tax exempt (E) number. Are we exempt from Hotel Operators' Occupation Tax?

In most cases, no. Under the Hotel Operators' Occupation Tax, public renting of hotel rooms, "is subject to the tax, even if the person paying for the room may be a church (except as provided in subsection (b)(8)), charity, or school or some other kind of nonprofit organization, and even if the person paying for the room may be a governmental agency or instrumentality (Federal, state, or local, or even a foreign government)."  86 Ill. Adm. Code 480.101(b)(3). However, diplomatic officials issued diplomatic exemption cards by the federal government are exempt from tax. 86 Ill. Adm. Code 480.101(b)(7).

Effective July 1, 2023, qualifying entities providing disaster relief are exempt from paying Hotel Operators' Occupation Tax on gross rental receipts for rooms (Public Act 103-0009).

To qualify, such organizations must 

  • be organized and operated exclusively by an organizaton chartered by the United States Congress to provide disaster relief, and
  • possess an active Illinois Exemption Identification Number issued by the Illinois Department of Revenue (IDOR).

For more inforrmation, see the Resource Page for New Hotel Occupation Tax ExemptionFY-2024-01, Hotel Operators' Occupation Tax Exemption for Qualifying Organizations, and the Hotel Operators' Occupation Tax page. 


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