Used Car Sales Tax in Illinois: 6.25% Rate Guide
Illinois used car sales tax, how to calculate it for private party and dealer purchases, trade-in credits, exemptions, and how and when to pay.
Illinois Used Car Sales Tax Rates (State + Local)
Illinois has a 6.25% state rate plus local taxes. Chicago reaches 11.5% combined — one of the highest in the country. Suburban Cook County is typically 9%–10.25%. Downstate areas are generally 6.25%–8.25%. However, private party sales use a flat-fee use tax structure that is entirely separate from these percentage rates.
Tax Base in Illinois
Flat fee (private party) or purchase price (dealer) — NOT a straight percentage for private sales
Illinois private party vehicle sales are governed by the Private Party Vehicle Use Tax, not the standard sales tax percentage. Tax is determined from Form RUT-5 (the annual flat-fee chart), not by multiplying the purchase price by 6.25%. Dealer purchases use the standard percentage sales tax.
Trade-In Sales Tax Credit in Illinois
Illinois allows a trade-in credit at dealerships (effective January 2020), capped at $10,000 per trade-in under current law. Tax is calculated on the net price after deducting the trade-in allowance (up to the cap). NOTE: trade-in deductions are NOT allowed on private party Form RUT-50 transactions.
Example calculation:
Private party purchase at $22,000 (Table B): flat fee per RUT-5 2026 chart — approximately $390 (vs. $1,375 at 6.25%). Private party purchase at $10,000 (Table A): flat fee based on model year — typically $165 or less. Dealer purchase at $22,000 in Chicago: $22,000 × 11.5% = $2,530.
Sales Tax on Private Party Used Car Sales in Illinois
Illinois private party used vehicle purchases are subject to the Private Party Vehicle Use Tax — a flat-fee system, not a percentage. Tax is reported and paid on Form RUT-50 using the RUT-5 chart. For vehicles under $15,000, Table A determines a flat fee based on model year. For vehicles $15,000 or more, Table B determines a flat fee based on price brackets. The flat fees are substantially lower than 6.25% of the purchase price for most vehicles.
File Form RUT-50 within 30 days of purchase. Trade-in deductions are not permitted on private party transactions. Family transfers (spouse, parent, child, brother, or sister) qualify for a $15 flat family transfer tax instead of the standard RUT-50 fee — per RUT-50 instructions, grandparent/grandchild does not qualify. The official 2026 flat-fee table is Form RUT-5, available at tax.illinois.gov.
Sales Tax on Dealer Used Car Purchases in Illinois
Illinois dealer sales of used vehicles are subject to the standard Illinois sales tax (6.25% state plus local rates). Dealers collect and remit the tax at the point of sale. Chicago-area dealer purchases face combined rates up to 11.5%.
The key Illinois distinction: dealer purchases use the standard percentage sales tax, while private party purchases use the flat-fee Private Party Vehicle Use Tax (Form RUT-50). The private party flat fee is almost always lower than 6.25% of the purchase price, making private party purchases tax-advantaged in Illinois.
Buying a Car Out of State and Registering in Illinois
Vehicles purchased outside Illinois and brought into Illinois for registration are subject to Illinois use tax. The rate and form depend on who the seller was — private party transactions from out of state still use Form RUT-50 and the flat-fee structure.
Credit is given for sales or use tax paid to another state, up to the Illinois amount. Bring documentation of any tax paid in the other state. File within 30 days of bringing the vehicle into Illinois.
Illinois Used Car Sales Tax Exemptions
- ✓Family transfers (spouse, parent, child, brother, or sister) — $15 flat tax applies (grandparent/grandchild does not qualify)
- ✓Inheritance or estate transfers qualifying under 35 ILCS 105/7
- ✓Transfers between spouses incident to divorce
- ✓Vehicles transferred to qualifying non-profit organizations
Illinois family transfers are not fully exempt — they qualify for the reduced $15 family transfer tax rather than the standard flat fee. Document the family relationship. Fraudulent exemption claims carry significant penalties.
How to Pay Used Car Sales Tax in Illinois
For private party sales: file Form RUT-50 and pay the flat fee to the Illinois Secretary of State or online via MyTax Illinois (mytax.illinois.gov) within 30 days of purchase. For dealer sales: the dealer collects sales tax at point of sale.
Late filing of Form RUT-50 incurs penalties and interest. The 30-day deadline runs from the date of purchase. MyTax Illinois will calculate the exact tax due from the RUT-5 chart automatically when you enter the vehicle details.
Illinois Sales Tax Note
Illinois private party purchases use a FLAT FEE, not a percentage. A $25,000 private sale pays a flat fee (roughly $390 per the RUT-5 chart) — not $1,562 (6.25%). This makes Illinois one of the most tax-friendly states for private party used car buyers. Always use the RUT-5 flat-fee chart for private sales; never apply the 6.25% rate to a private transaction.
Used Car Sales Tax FAQ — Illinois
What is the sales tax rate on a used car in Illinois?
The base state sales tax rate in Illinois is 6.25%. Illinois has a 6.25% state rate plus local taxes. Chicago reaches 11.5% combined — one of the highest in the country. Suburban Cook County is typically 9%–10.25%. Downstate areas are generally 6.25%–8.25%. However, private party sales use a flat-fee use tax structure that is entirely separate from these percentage rates.
Do I get a trade-in credit on sales tax when buying a used car in Illinois?
Yes. Illinois allows a trade-in credit at dealerships (effective January 2020), capped at $10,000 per trade-in under current law. Tax is calculated on the net price after deducting the trade-in allowance (up to the cap). NOTE: trade-in deductions are NOT allowed on private party Form RUT-50 transactions.
How is sales tax calculated on a private party used car purchase in Illinois?
Illinois private party used vehicle purchases are subject to the Private Party Vehicle Use Tax — a flat-fee system, not a percentage. Tax is reported and paid on Form RUT-50 using the RUT-5 chart. For vehicles under $15,000, Table A determines a flat fee based on model year. For vehicles $15,000 or more, Table B determines a flat fee based on price brackets. The flat fees are substantially lower than 6.25% of the purchase price for most vehicles. File Form RUT-50 within 30 days of purchase. Trade-in deductions are not permitted on private party transactions. Family transfers (spouse, parent, child, brother, or sister) qualify for a $15 flat family transfer tax instead of the standard RUT-50 fee — per RUT-50 instructions, grandparent/grandchild does not qualify. The official 2026 flat-fee table is Form RUT-5, available at tax.illinois.gov.
How do I pay sales tax when buying a used car privately in Illinois?
For private party sales: file Form RUT-50 and pay the flat fee to the Illinois Secretary of State or online via MyTax Illinois (mytax.illinois.gov) within 30 days of purchase. For dealer sales: the dealer collects sales tax at point of sale. Late filing of Form RUT-50 incurs penalties and interest. The 30-day deadline runs from the date of purchase. MyTax Illinois will calculate the exact tax due from the RUT-5 chart automatically when you enter the vehicle details.
Are there any used car sales tax exemptions in Illinois?
Family transfers (spouse, parent, child, brother, or sister) — $15 flat tax applies (grandparent/grandchild does not qualify); Inheritance or estate transfers qualifying under 35 ILCS 105/7; Transfers between spouses incident to divorce; Vehicles transferred to qualifying non-profit organizations. Illinois family transfers are not fully exempt — they qualify for the reduced $15 family transfer tax rather than the standard flat fee. Document the family relationship. Fraudulent exemption claims carry significant penalties.
If I buy a car out of state and register it in Illinois, do I pay Illinois sales tax?
Vehicles purchased outside Illinois and brought into Illinois for registration are subject to Illinois use tax. The rate and form depend on who the seller was — private party transactions from out of state still use Form RUT-50 and the flat-fee structure. Credit is given for sales or use tax paid to another state, up to the Illinois amount. Bring documentation of any tax paid in the other state. File within 30 days of bringing the vehicle into Illinois.