State Tax Day - Current, S.3, Illinois—Sales and Use Tax: Taxation of Deal-of-the-Day Vouchers Discussed, (Jun 1, 2026)

Illinois issued a general information letter on the taxation of online digital prepaid vouchers redeemable for a round of golf or items in golf course pro shops. These transactions are known as Deal-of-the-Day vouchers. Businesses or individuals selling vouchers that entitle purchasers to redeem those vouchers for tangible personal property or services are making sales of nontaxable intangibles. When the purchaser redeems the voucher for a round of golf, the golf course is providing a nontaxable service if it does not involve the transfer of any tangible personal property incident to that service. When Deals-of-the-Day involve vouchers redeemable for tangible personal property, like golf balls or a golf hat, the sale of the voucher is still a nontaxable sale of intangibles. However, the redemption of the voucher at the golf course is a taxable transaction, because it involves the taxable sale of tangible personal property. If the golf course knows how much the customer paid for the voucher, it must charge tax based on that amount. If the golf course does not know how much the customer paid for the voucher, it must charge tax based on the full value of the voucher. For example, if a seller sells a voucher for a sleeve of golf balls and the golf course does not know how much the customer paid for the voucher, then the golf course must pay sales tax and charge the customer use tax based on the price the course normally charges for the sleeve of golf balls.

General Information Letter ST 26-0014-GIL, Illinois Department of Revenue, April 28, 2026, ¶404-249