The sales tax rate in Niles, Illinois is 10.25% on general merchandise. That combined rate is split among five taxing bodies, from the State of Illinois down to the village itself, and it applies to most tangible goods bought at retail in the village. Groceries, medicine, restaurant meals, and vehicles each follow different rules, and several of those rules changed on January 1, 2026.
How the 10.25% Rate Breaks Down
Every dollar of sales tax collected in Niles is divided among multiple government bodies. The Village of Niles lists the components this way:1Village of Niles, IL. Tax Information
- State of Illinois: 5.00%
- State Mass Transit: 0.25%
- Regional Mass Transit: 1.00%
- Cook County: 1.75%
- Village of Niles: 2.25%
The first three lines are commonly grouped as the 6.25% “state rate” under the Retailers’ Occupation Tax Act, since the transit portions are imposed at the state level. Retailers apply the full 10.25% to clothing, electronics, furniture, and most other tangible goods sold in the village.
What You Pay on Groceries
Before 2026, qualifying groceries carried a reduced state tax rate of 1% instead of the standard 6.25%. That 1% state grocery tax was eliminated entirely on January 1, 2026. The same law gives municipalities and counties the option to impose their own local grocery tax of exactly 1% by ordinance.2Illinois Department of Revenue. FY 2026-11, Municipal and County Grocery Occupation Tax Rate
“Qualifying groceries” means food for human consumption purchased to eat off the premises. Alcoholic beverages, soft drinks, candy, and food prepared for immediate consumption do not qualify and remain subject to the full general merchandise rate.3Legal Information Institute. Illinois Code tit. 86, 140.126 – Taxation of Food, Drugs and Medical Appliances Whether you see a local grocery tax at the register in Niles depends on whether the village and Cook County have adopted ordinances under the new authority. For the current local figure, contact the Village of Niles Finance Department.
Medicine and Medical Devices
Prescription and over-the-counter drugs, insulin, blood sugar testing supplies, syringes, and certain medical appliances qualify for a 1% state tax rate. The same reduced rate covers Class III medical devices used for cancer treatment under a prescription, along with their accessories and components.3Legal Information Institute. Illinois Code tit. 86, 140.126 – Taxation of Food, Drugs and Medical Appliances That 1% applies to the state portion of the tax; local taxes may add to the total depending on the item and the jurisdiction.
Restaurant Meals in Niles
Prepared food and alcoholic drinks bought at restaurants, bars, and similar establishments inside the village carry a separate 1% Village of Niles food and beverage tax on top of the standard sales tax. The village board adopted it in 2007.4Village of Niles, IL. Food and Beverage Tax A restaurant meal in Niles therefore carries the full 10.25% general merchandise sales tax plus this additional 1%, for an effective rate of 11.25%.
Vehicles and Other Titled Property
Cars, trucks, motorcycles, trailers, watercraft, and other titled property follow their own rules. The tax rate is generally based on the buyer’s home address rather than the dealership’s location. Someone living outside Niles who buys from a Niles dealer may pay a different rate, and a Niles resident buying elsewhere may still owe the Niles rate.
Which form applies depends on where you bought the vehicle. Dealers registered with the Illinois Department of Revenue file Form ST-556 (Sales Tax Transaction Return) for each sale. If you bought from an unregistered out-of-state dealer or from a private seller, you file Form RUT-25 (Vehicle Use Tax Transaction Return) yourself when you title or register the vehicle in Illinois.5Illinois Department of Revenue. Vehicle Use Tax Transaction Return Instructions Form RUT-25 Both forms are available through the Illinois Department of Revenue’s vehicle tax forms page.6Illinois Department of Revenue. Aircraft, Vehicles, and Watercraft Sales and Use Tax Forms
Online Orders Shipped to Niles
Starting in 2026, the rules for online and out-of-state sellers shipping into Illinois changed. Remote retailers and marketplace facilitators must now collect sales tax at the destination-based rate, meaning the rate at the address where the buyer receives the goods rather than wherever the seller sits. The previous threshold requiring 200 or more transactions was eliminated on January 1, 2026. Any remote retailer meeting $100,000 or more in cumulative Illinois gross receipts must collect at that destination rate.7Illinois Department of Revenue. Destination-Based Sales Tax Assistance
For a Niles resident, the practical result is that most online purchases shipped to your address should now show 10.25% at checkout. Brick-and-mortar retailers with a physical location in Niles register that address as their permanent place of business and continue collecting tax as before. If a remote retailer cannot determine the delivery location, the Illinois Department of Revenue will assess tax at a 15% rate on those unlocated sales.7Illinois Department of Revenue. Destination-Based Sales Tax Assistance
If You Run a Business That Collects the Tax
Any business selling tangible goods in Niles must register with the Illinois Department of Revenue before collecting sales tax. Registration is done on Form REG-1 (Illinois Business Registration Application), which you can complete electronically through MyTax Illinois or submit by mail.8Illinois Department of Revenue. Business Registration The form asks for your business’s legal name, address, Federal Employer Identification Number, and the Social Security numbers of owners. During registration, you select “Sales and Use Tax” as the tax type and give the date operations begin. The Department then assigns a filing frequency.
Returns go on Form ST-1 (Sales and Use Tax and E911 Surcharge Return) and are due by the 20th of the month after the reporting period closes. Monthly, quarterly, or annual filing depends on your liability. Businesses averaging $20,000 or more per month in liability must make quarterly prepayments, and most of those businesses are also required to pay by electronic funds transfer.9Illinois Department of Revenue. Sales and Use Taxes
File on time and pay in full, and Illinois lets you keep 1.75% of the tax collected as a retailer’s discount for the cost of record-keeping and filing. Beginning with returns due on or after January 1, 2025, the discount is capped at $1,000 per month across all returns filed in that month.10Illinois General Assembly. 35 ILCS 120/3 File or pay late and you forfeit the discount for that period.
Record-keeping took on new weight in 2026. If you cannot provide records sufficient to determine where a sale was delivered, the Department can assess tax on those sales at a 15% rate, including retroactively for any period under audit.11Illinois Department of Revenue. Pub-113, Keeping Complete and Accurate Records Keep clean delivery records for every shipped sale.