DID YOU KNOW YOU COULD BE ELIGIBLE FOR TAX EXEMPTION?
The ST-587 Exemption Certificate May Help You Avoid Sales Tax on Certain Essential Items.
Are you an Illinois business in manufacturing, production agriculture, or coal and aggregate mining? Did you know that the uniforms, protective gear, and even other supplies you use could potentially qualify for tax exemption?
If you're already renting these items to be used primarily in your business operations, you might be able to avoid paying sales tax on them. It's all thanks to a tax benefit you might not be aware of—The ST-587 Exemption Certificate.
What is the ST-587 Exemption Certificate?
The ST-587 Exemption Certificate is a form that allows businesses in qualifying industries to purchase specific items without paying sales tax. The purpose of the certificate is to prove that the items you purchase will be used for production, and as such, sales tax is not required.
Qualifying industries include:
- Manufacturing
- Production Agriculture
- Coal and Aggregate Mining
Which Items Qualify for Exemption?
Under the exemption, businesses in eligible industries can purchase various items tax-free, which can include:
- Protective Clothing: Gloves, helmets, uniforms, and other safety gear
- Tools and Equipment: Hand tools, machinery, consumables like lubricants, oils, and adhesives
- Fire and Safety Equipment: Items used for workplace safety, including fire protection gear
- Other Supplies: Items like coolants, solvents, and fuels used in manufacturing processes
*Some items you rent from us may qualify for the tax exemption while others don’t. You will have to work with your tax attorney to determine the items that qualify.
How Does the Exemption Process Work?
- Step 1: Complete the Exemption Certificate
Fill form ST-587 and submit it to your tax attorney to see if you qualify for the tax exemption. The certificate requires information about your business (the seller and purchaser), the items you're buying, and how those items will be used. If you are making ongoing purchases from the seller (ex: renting of garments/products) make sure to fill out Step 6: Blanket Certificate to cover the ongoing purchases.
- Step 2: Submit to the Seller
If approved, provide the blanket certificate to the seller at the time of purchase to avoid paying sales tax on the eligible items. Update this certificate every three years. - Step 3: Keep Records
We will keep a copy of the certificate for our records, and will request it as proof if necessary.
Who Needs to Provide the Exemption Certificate?
If your business is purchasing items for production use and you’re eligible for the exemption, you are responsible for providing the certificate to the seller. This document helps ensure that your purchases are tax-exempt.
Need More Information?
Don’t miss out on potential tax savings. Contact your tax attorney to see if your company qualifies for the ST-587 Exemption Certificate. If you do, let us know as soon as possible to help you save money on your essential purchases!
Don't hesitate to contact us to discuss further - click the form below to get in contact with your Service Manager.
