Section 660.15  Distributor Licenses

a)         It shall be unlawful for any person to engage in business as a distributor of tobacco products within the meaning of the Act without first having obtained a license to do so from the Department.  Application for a distributor's license shall be made to the Department in a form prescribed and furnished by the Department and shall be accompanied by a bond, if applicable as provided in subsection (d).  [35 ILCS 143/10-20]  Bonds may be furnished electronically by sureties using one of the methods contained in 86 Ill. Adm. Code 760.230(b).  Each licensed place of business shall be covered by a separate license. Subject to the limitations regarding little cigars imposed on retailers contained in this subsection (a) and Section 660.28, a retailer who receives or purchases tobacco products on which the tax has not been paid or will not be paid by another distributor is required to register with the Department and obtain a license, file returns, and pay the Tobacco Products Tax.  Whenever any sales invoice issued by a supplier to a retailer for tobacco products sold to the retailer does not comply with the requirements of Section 660.25(d), (e), and (g), a prima facie presumption shall arise that the tax imposed by Section 10-10 of the Act and Section 660.5 has not been paid on the tobacco products listed on the sales invoice.

1)         Subject to the limitations regarding little cigars imposed on retailers contained in this subsection (a) and Section 660.28, a retailer who receives or purchases tobacco products from an out-of-State distributor that is not registered with the Department must obtain a license.

2)         Subject to the limitations regarding little cigars imposed on retailers contained in this subsection (a) and Section 660.28, a retailer who receives or purchases tobacco products from a supplier, whether within or without the State, that is not registered with the Department must obtain a license.

b)         The Department may, in its discretion, and upon application issue licenses authorizing the payment of the tax imposed by the Act on tobacco products, excluding little cigars, by any distributor or manufacturer not otherwise subject to the tax imposed under the Act who, to the satisfaction of the Department furnishes adequate security to ensure payment of the tax.  [35 ILCS 143/10-20]

c)         Wholesalers that are not registered and licensed as distributors with the Department but claim to only sell tobacco products, excluding little cigars, in such a way that their sales are not taxable under the Act (e.g., resale or to exempt purchasers) are advised to apply to the Department for a resale number so that those wholesalers are able to provide distributors with Certificates of Resale when purchasing the tobacco products, excluding little cigars, that will be resold.  Those wholesalers need not file returns with the Department. See Section 660.30, Exempt Sales.

d)         Bonding.

1)         Each distributor shall file with the Department a bond in an amount not to exceed 3 times the amount of the distributor's average monthly tax liability or $50,000, whichever is lower, on a form to be approved by the Department, except for:

A)        a distributor who is applying for a distributor's license under the Act for the first time; or

B)        a distributor who, in the preceding year, had less than $50,000 of tax liability.

2)         Any applicant applying for a distributor's license after the applicant's distributor's license has been revoked by the Department shall also file a bond with the Department in an amount equal to 3 times the amount of the applicant's average monthly tax liability under the Act, as that average monthly tax liability was calculated immediately prior to the revocation of the applicant's distributor's license.

3)         The Department shall discharge any surety and shall release and return any bond provided to it by a taxpayer under this subsection within 90 days after:

A)        the taxpayer becomes a prior continuous compliance taxpayer, as defined in 660.10; or

B)        the taxpayer has ceased to collect receipts on which the taxpayer is required to remit the tax under the Act to the Department, has filed a final tax return, and has paid to the Department an amount sufficient to discharge any remaining tax liability as determined by the Department under the Act. 

e)         Licenses issued by the Department under the Act shall be valid for a period not to exceed one year after issuance unless sooner revoked, canceled, or suspended as provided in the Act.

f)         No license shall be issued to any person who is in default to the State of Illinois for moneys due under the Act or any other tax Act administered by the Department. [35 ILCS 143/10-20]

g)         No person shall be issued a license or granted a renewal of a license to act as a distributor unless the person has certified in writing, under penalty of perjury, that the person will comply fully with the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003.  [30 ILCS 167/35(b)]

(Source:  Amended at 50 Ill. Reg. 8384, effective June 1, 2026)