Section 35 ILCS 110/2d - Marketplace facilitators and marketplace servicemen(a) Definitions. For purposes of this Section: "Affiliate" means a person that, with respect to another person: (i) has a direct or indirect ownership interest of more than 5% in the other person; or (ii) is related to the other person because a third person, or group of third persons who are affiliated with each other as defined in this subsection, holds a direct or indirect ownership interest of more than 5% in the related person.
"Marketplace" means a physical or electronic place, forum, platform, application or other method by which a marketplace serviceman makes or offers to make sales of service.
"Marketplace facilitator" means a person who, pursuant to an agreement with a marketplace serviceman, facilitates sales of service by that marketplace serviceman. A person facilitates a sale of service by, directly or indirectly through one or more affiliates, doing both of the following: (i) listing or otherwise making available a sale of service of the marketplace serviceman through a marketplace owned or operated by the marketplace facilitator; and (ii) processing sales of service for, or payments for sales of service by, marketplace servicemen.
"Marketplace serviceman" means a person that makes or offers to make a sale of service through a marketplace.
(b) Beginning January 1, 2020, a marketplace facilitator who meets either of the following criteria is considered the serviceman for each sale of service made on the marketplace: (1) the cumulative gross receipts from sales of service to purchasers in Illinois by the marketplace facilitator and by marketplace servicemen are $100,000 or more; or(2) the marketplace facilitator and marketplace servicemen cumulatively enter into 200 or more separate transactions for the sale of service to purchasers in Illinois. A marketplace facilitator shall determine on a quarterly basis, ending on the last day of March, June, September, and December, whether he or she meets the criteria of either paragraph (1) or (2) of this subsection (b) for the preceding 12-month period. If the marketplace facilitator meets the criteria of either paragraph (1) or (2) for a 12-month period, he or she is considered a serviceman maintaining a place of business in this State and is required to collect and remit the tax imposed under this Act and file returns for one year. At the end of that one-year period, the marketplace facilitator shall determine whether the marketplace facilitator met the criteria of either paragraph (1) or (2) during the preceding 12-month period. If the marketplace facilitator met the criteria in either paragraph (1) or (2) for the preceding 12-month period, he or she is considered a serviceman maintaining a place of business in this State and is required to collect and remit the tax imposed under this Act and file returns for the subsequent year. If, at the end of a one-year period, a marketplace facilitator that was required to collect and remit the tax imposed under this Act determines that he or she did not meet the criteria in either paragraph (1) or (2) during the preceding 12-month period, the marketplace facilitator shall subsequently determine on a quarterly basis, ending on the last day of March, June, September, and December, whether he or she meets the criteria of either paragraph (1) or (2) for the preceding 12-month period.
(c) A marketplace facilitator that meets either of the thresholds in subsection (b) of this Section is considered the serviceman for each sale of service made through its marketplace and is liable for collecting and remitting the tax under this Act on all such sales. The marketplace facilitator has all the rights and duties, and is required to comply with the same requirements and procedures, as all other servicemen maintaining a place of business in this State who are registered or who are required to be registered to collect and remit the tax imposed by this Act.(d) A marketplace facilitator shall: (1) certify to each marketplace serviceman that the marketplace facilitator assumes the rights and duties of a serviceman under this Act with respect to sales of service made by the marketplace serviceman through the marketplace; and(2) collect taxes imposed by this Act as required by Section 3-40 of this Act for sales of service made through the marketplace.(e) A marketplace serviceman shall retain books and records for all sales of service made through a marketplace in accordance with the requirements of Section 11.(f) A marketplace serviceman shall furnish to the marketplace facilitator information that is necessary for the marketplace facilitator to correctly collect and remit taxes for a sale of service. The information may include a certification that an item transferred incident to a sale of service under this Act is taxable, not taxable, exempt from taxation, or taxable at a specified rate. A marketplace serviceman shall be held harmless for liability for the tax imposed under this Act when a marketplace facilitator fails to correctly collect and remit tax after having been provided with information by a marketplace serviceman to correctly collect and remit taxes imposed under this Act.(g) Except as provided in subsection (h), if the marketplace facilitator demonstrates to the satisfaction of the Department that its failure to correctly collect and remit tax on a sale of service resulted from the marketplace facilitator's good faith reliance on incorrect or insufficient information provided by a marketplace serviceman, it shall be relieved of liability for the tax on that sale of service. In this case, a marketplace serviceman is liable for any resulting tax due.(h) A marketplace facilitator and marketplace serviceman that are affiliates, as defined by subsection (a), are jointly and severally liable for tax liability resulting from a sale of service made by the affiliated marketplace serviceman through the marketplace.(i) This Section does not affect the tax liability of a purchaser under this Act.(j) The Department may adopt rules for the administration and enforcement of the provisions of this Section.Added by P.A. 101-0009,§ 10-15, eff. 6/5/2019.