Illinois DOR Issues Letter on Income Tax Nexus From In-State Inventory

The Illinois Department of Revenue (DOR) issued a general information letter regarding nexus for income tax purposes. The Department stated that a corporation’s activities in Illinois beyond solicitation, if more than de minimus will establish nexus with Illinois. Based on the facts presented, where an out-of-state corporation retains ownership of merchandise located in an Illinois warehouse before a contract packager ships it, the Department states that such activity may be more than de minimis and could create a physical presence nexus in Illinois for income tax purposes. [Ill. Dep’t of Revenue, IT-26-0001-GIL, 03/16/26]

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