Is digital advertising taxable in Illinois?
From 2027-01-01. Illinois SB 3019 enacts a 10% Targeted Advertising Services Tax on providers with $1M or more in Illinois receipts.
| Short answer | Taxable from 2027-01-01 |
|---|---|
| Effective date | Takes effect 2027-01-01. |
| Authority | Illinois SB 3019 |
| Last reviewed | 2026-09-18 |
Why
Illinois SB 3019 creates a 10% tax on targeted advertising services for providers with $1M or more in Illinois receipts, taking effect 2027-01-01. It is a separate tax, not part of Illinois sales tax.
Like Maryland's tax, it faces Internet Tax Freedom Act and Commerce Clause exposure. There is no collection obligation before 2027-01-01.
Business vs. consumer buyers
The tax falls on the provider of targeted advertising services. Buyer type does not change it.
Where the line is
- AgentTax does not calculate this tax.
How AgentTax classifies digital advertising
Selling digital or targeted advertising: ad space, ad targeting and delivery on digital interfaces. AgentTax does not calculate digital advertising taxes. They are separate gross receipts or excise taxes, not sales tax.
Run a Illinois sale through the AgentTax engine and get the amount, the rate it used and the statute behind it. No signup needed.
Open the calculatorFrequently asked questions
- When does the Illinois targeted advertising tax start?
- 2027-01-01, at 10%, for providers with $1M or more in Illinois receipts.
Related
- All Illinois digital tax answers
- Is SaaS taxable in Illinois? (full guide)
- Are information services taxable in Illinois?
- Digital advertising: every state we cover
- Is digital advertising taxable in Maryland?
- Is digital advertising taxable in Utah?
Further reading on the AgentTax blog
- Illinois Just Wrote 'Machine Learning Algorithms' Into a Tax Statute: SB 3019's Targeted Advertising Tax and AI Agents
- Illinois SB 3019 Is Now Law: Pritzker Signs the First Enacted AI-Keyed Ad Tax and Digital Asset Privilege Tax
Sources
- Illinois SB 3019
This page is for informational purposes only and is not tax, legal, or accounting advice. It reflects AgentTax's current interpretation of evolving law, which can change. Consult a qualified tax professional before making compliance decisions. Positions on this page come from the AgentTax tax policy registry (v1.24.0); see our methodology.