2026 Sales and Grocery Tax Changes

Confirm Your 2026 Sales Tax Rates

With the new year right around the corner, businesses need to review and confirm their sales tax rates ahead of January 1, 2026. Each year brings updates from the Illinois Department of Revenue (IDOR) and local taxing jurisdictions, and 2026 will be no exception.

Many municipalities and counties across the state have adjusted local sales tax rates or adopted new tax ordinances effective January 1, 2026. These changes can affect the combined sales tax rate you charge your customers and must be reflected in your point-of-sale systems, accounting software, and invoices.

To check current and updated sales tax rates for your business locations, use the official Illinois Tax Rate Finder. This tool lets you look up combined state and local sales tax rates for specific addresses and will reflect all applicable changes for January 2026. https://mytax.illinois.gov/?Link=TaxRateFinder

Illinois 2026 Grocery Sales Tax Changes

Additionally, Illinois is making a notable change to how groceries are taxed starting January 1^st, 2026. Under current law, the State imposes 1% sales and use tax on grocery sales (often referred to as the “low rate”). Effective January 1, 2026, the State of Illinois will eliminate this 1% tax on groceries. However, the law also authorizes municipalities and counties to impose their own local 1% grocery tax. Many local governments have already filed ordinances that will take effect on January 1, 2026. This means the tax rate on grocery sales in your area might stay the same or change depending on your local jurisdiction.

If you sell groceries or other food items, verify the combined tax rate for your location and plan for any register or system updates needed for January 1^st. Retailers should also be aware that reporting requirements on Form ST-1 and related forms will change to reflect this update. The complete details can be found in the Illinois Department of Revenue’s informational bulletin. https://tax.illinois.gov/research/publications/bulletins/fy-2026-03.html

Eccezion Is Here to Help

Need help navigating these challenges or have any questions? Our team is happy to review your specific situation to help you navigate the 2026 sales tax landscape.