Illinois Appellate Court Affirms Taxpayer’s Lease Tax Obligations, Reverses Prorated Taxes on Moved-In Vehicles

The Illinois Appellate Court March 20 issued a decision affirming in part and reversing in part a circuit court order and an administrative law judge’s decision regarding lease transaction and use taxes assessed against taxpayer-company by the Chicago Department of Finance. The Court found that taxpayer was required to remit lease taxes on Capitalized Cost Reduction (CCR) payments it received as credits against vehicle purchase prices from dealers, but was not required to remit prorated lease taxes on CCR payments for vehicles leased outside Chicago and initially registered outside Chicago before being moved into the city during the lease term. ...