Illinois DOR Issues General Information Letter Regarding Income Tax Nexus for Software as Service Sales

The Illinois Department of Revenue (DOR) Oct. 12, 2023 issued a general information letter regarding the corporate income tax nexus for sales of Software as a Service (SaaS). Taxpayer, a non-resident corporation, offered a SaaS solution on its website. Taxpayer inquired whether its SaaS sales would result in nexus for filing an Illinois corporate income tax return. The DOR noted: 1) non-resident corporations are taxable on their net income on the privilege of earning income in Illinois; 2) corporations qualified to do business in Illinois must file the return if they file federal income tax returns; 3) Illinois hadn’t adopted ...