Business
Illinois Tax Alert: New Advertising Tax Takes Effect Jan. 1
Springfield, IL – A new Illinois tax targeting certain advertising services is set to take effect Jan. 1, 2027, and state officials are giving businesses and industry stakeholders until Nov. 30 to wei
By Claire Benton · 2026-10-31T11:19:23.715Z
Springfield, IL – A new Illinois tax targeting certain advertising services is set to take effect Jan. 1, 2027, and state officials are giving businesses and industry stakeholders until Nov. 30 to weigh in on proposed rules that could affect how the tax is implemented.
According to the Illinois Department of Revenue IDOR , draft proposed rules for the Targeted Advertising Services Tax Act are now available for public review before the state begins its formal rulemaking process.
The law, enacted under Article 1 of Public Act 104 0468, imposes a tax on providers' gross receipts generated from targeted advertising services provided in Illinois.
The tax applies to providers of targeted advertising services, rather than automatically imposing a new tax on every business that purchases advertising.
IDOR Director David Harris said the department is seeking input because of the industry's complexity and the potentially large number of affected entities.
"Given the complexity of the targeted advertising industry and the possibly large number of entities subject to the tax we want to ensure the rules provide clear direction and notice for those affected by the new law," Harris said.
What Illinois Businesses Should Know The proposed regulations could be particularly relevant to companies providing targeted digital advertising services within Illinois.
State officials are requesting feedback on issues not adequately addressed in the draft rules, along with practical examples showing how the law would apply to different business situations.
The department emphasized that the current review period comes before formal rulemaking, giving stakeholders an early opportunity to identify potential compliance concerns.
Public Comment Deadline Approaching Interested parties have until 5 p.m. Monday, Nov. 30, 2026, to review the draft proposed rules and submit feedback.
The documents are available through the department's official website at tax.illinois.gov .