How do taxes work for online businesses in Illinois?

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Hi everyone,
I am about to start an online business with Shopify. I want to know how taxes work in Illinois. If somebody is experienced with that I would appreciate it if he/she can help me.
Thanks in advance



Reply 1 (1)

Shopify Staff
1167 122 148

Hi there, @fabionm!


Thank you for your post, I'm happy to help you out.


I'm unable to provide tax advice, but I can definitely share some resources and hopefully point you in the right direction. I recommend reading over our US taxes reference, as well as the section on Illinois specifically. This help document goes over how to determine your tax liability, the different types of tax sourcing states (Illinois is an Origin tax state), and more. Here is some information from that help document about Origin states that may be helpful for determining your tax liability:


  • If you have no nexus in the state of the shipping address, then no tax is charged.

  • If you have a physical nexus in the state of the shipping address, then the location of your nexus is used to determine taxes. If you have a nexus but no physical location, then the customer's location is used to determine taxes.


If you'd like to read more about taxes on Shopify, you can check out these two blog posts designed to help you get a better understanding of this topic:



If you still have questions about where you should be charging taxes, I recommend contacting a tax professional in your area for further guidance. 


If you're looking for more advanced help with taxes on your store, you have the option to hire a U.S. sales tax expert. These experts can assist you with setting up the correct taxes on your store, and provide you with a better understanding of your tax obligations.


Please let me know if you have any more questions!

Greta | Shopify 
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