New Illinois Manufacturing Machinery & Equipment Exemptions

Welder

Effective July 1, 2019, production related tangible personal property is now included within the Illinois manufacturing machinery and equipment exemption.

Production related tangible personal property means all tangible personal property primarily used or consumed in a production related process by a manufacturer in a manufacturing facility in which a manufacturing process takes place. The exemption for production related tangible personal property applies to a variety of activities that take place in a manufacturing facility. These activities include manufacturing, research and development, storage, preproduction material handling, inventory control, quality control, receiving, staging, and packaging for shipping and transportation purposes. The following is a list of products that are now exempt in Illinois:

• Canned software used in research and development

• Cleaning chemicals -

  • Used to clean exempt manufacturing equipment
  • Used to clean equipment used in food processing
  • Used to clean manufacturing facility

• Manufacturing tooling

• Manufacturing tools

• Materials used directly in manufacturing including materials consumed by manufacturer to maintain manufacturing machinery

• Materials used directly in photo processing including materials consumed by processor

• Packaging

• Protective equipment used in manufacturing –

  • Ear and hearing protectors
  • Face shields
  • Hard hats

• Safety equipment used in manufacturing that is attached to manufacturing machinery and equipment, not required by law, and necessary for operation of the machinery and equipment

• Safety equipment used in manufacturing that is attached to manufacturing machinery and equipment, not required by law, and not necessary for operation of the machinery and equipment

• Safety equipment used in manufacturing that is attached to manufacturing machinery and equipment, required by law, and necessary for operation of the machinery and equipment

• Safety equipment used in manufacturing that is attached to manufacturing machinery and equipment, required by law, and not necessary for operation of the machinery and equipment

• Safety equipment used in manufacturing that is not attached to manufacturing machinery and equipment

• Specialty clothing used in manufacturing –

  • Protective apparel
  • Protective eyewear
  • Protective latex gloves
  • Surgical masks

• Pallets sold to manufacturer –

  • For use in conveying materials through the production process
  • To store finished goods in warehouse
  • To package and ship finished goods that are

• R&D Equipment

• R&D Supplies

• Utilities/Fuel used in manufacturing

How to Claim the Credit:

Provide a completed ST-587 form to your vendor when making the purchase, being sure to mark off in Step 5 the first box that shows your purchase is production related tangible personal property.

Link to ST-587: https://www2.illinois.gov/rev/forms/sales/Documents/sales/st-587.pdf

If you have any questions, please feel free to leave us a message or give us a call at 847-956-1040.

We Help You Get to Your Next Level™

Get in touch today and find out how we can help you meet your objectives.

Call Us