Last Couple of Days to Trade Your Vehicle In Before New Illinois Tax Law Takes Effect

The last couple of days of 2019 could be very busy for Illinois Car Dealers because of a new Tax Law that takes effect on January 1, 2020.

The State of Illinois currently does not collect sales tax on a car’s trade-in value, which acts as credit toward a new vehicle purchase. By law, sales tax only applies to the difference between trade-in value and the new vehicle’s purchase price.

That changes Jan. 1. Under Senate Bill 690, signed June 28 by Gov. J.B. Pritzker, state and local sales tax will be applied to any trade-in value above $10,000. The new tax is expected to cost Illinoisans $60 million a year – which was earmarked not for roads, but for vertical infrastructure such as new state buildings and renovations. Read more from Illinois Policy.org.