Indiana and Illinois Sales Tax Amnesty 2026: Two Windows Are Open Right Now

Indiana Tax Amnesty 2026: Full Relief Through September 9

Indiana's Department of Revenue opened its amnesty window on July 15, 2026, and it runs through September 9, 2026. That is a 57-day window, and once it closes, it is gone until the next legislative session authorizes one. The Indiana DOR Tax Amnesty 2026 page contains the official details, eligibility tool, and participation instructions.

Indiana is offering a 100% waiver of penalties, interest, and collection fees on eligible liabilities, provided you pay the underlying tax. This is not a reduction or a partial credit. The entire penalty and interest load disappears once you pay the base amount owed.

All Indiana state-listed taxes are eligible for periods ending before January 1, 2024. Sales tax is included, as are withholding, income tax, and other listed tax types. Any individual or business with outstanding Indiana tax liability for those periods can participate, including businesses with no physical presence in Indiana. One exception applies: taxpayers who participated in Indiana's 2005 or 2015 amnesty programs are not eligible. If you sat out both of those, this window is open to you.

Indiana is also allowing payment plans. You do not have to pay the full balance by September 9, provided the entire balance is paid by June 7, 2027. Businesses that set up a plan by the September 9 deadline still receive the complete penalty and interest waiver. Participation happens through the Indiana INTIME taxpayer portal or by phone at 888-782-5985.

The non-participation consequence is the part businesses most consistently underestimate. Indiana has been explicit: taxpayers who are eligible and choose not to participate will face an additional penalty on those eligible periods. The window is not neutral. Walking away from it without acting costs you more than the underlying tax alone.

Illinois Remote Retailer Amnesty 2026: Built for Post-Wayfair Sellers

Illinois is running a separate, targeted program under 35 ILCS 120/2-13, added by Public Act 104-0006. The window opens August 1, 2026, and runs through October 31, 2026. The Illinois Department of Revenue administers the program. This is not a general amnesty. Illinois built it specifically for remote retailers who crossed the economic nexus threshold but did not register or file.

The threshold for periods through December 31, 2025 was $100,000 in annual gross receipts or 200 or more separate transactions. As of January 1, 2026, Illinois eliminated the 200-transaction test entirely. For periods beginning in 2026, the only threshold is $100,000 in gross receipts. If your business crossed either threshold in any quarter between January 1, 2021 and June 30, 2026 without registering and collecting Illinois sales tax, this program was written for you.

Illinois is waiving all penalties and interest on those eligible periods. The underlying tax remains due. Illinois has published simplified composite rates for this program: 9% for general merchandise and 1.75% for qualifying food, medicine, and medical appliances.

The most important administrative step: complete your MyTax Illinois account registration before August 1. Registration with IDOR takes one to two business days. Do not wait until the window opens.

IDOR has stated clearly that remote retailers who meet the threshold and skip amnesty will face audits carrying the risk of assessment at a 15% undetermined location rate, which is significantly larger than the composite rate available through the amnesty program. The voluntary path is both faster and cheaper.

Two Windows, One Summer: Why the Timing Matters

The fact that both programs are running simultaneously is unusual. For a business with exposure in both states, the sequencing is straightforward: handle Indiana first because it closes September 9, then turn attention to Illinois before October 31. Neither deadline should be treated as a firm date to scramble toward at the last minute.

In our experience working with online retailers who sell nationally, the businesses that engage these programs early come out ahead consistently. The ones that wait for a better moment typically find themselves past the deadline and facing the full liability with interest. Amnesty programs of this scope appear roughly once a decade in any given state. Two running simultaneously will not repeat on a convenient schedule.

Is Amnesty the Right Move for Your Business?

Amnesty makes clear sense when you have calculable exposure that you have not addressed, the penalty and interest are a material number, you want to register and get compliant going forward, and you are not currently in litigation over the same periods.

Pause and get advice first if you are already under audit in Indiana or Illinois, or if you have a legitimate technical defense on the underlying tax itself. In those situations, the analysis shifts and the waiver may not be the right trade.

The mistake to avoid is treating 'I need to think about it' as an indefinite deferral. Indiana closes September 9. If you are still weighing options on September 10, the program has already made the decision for you.

What to Do Before August 1

If you have Indiana exposure, the window is already open. Review your eligibility using the Indiana DOR eligibility tool, calculate your liability for pre-2024 periods, and initiate the payment process through INTIME.

If you have Illinois exposure, complete your MyTax Illinois registration before August 1. The registration is a prerequisite and takes one to two business days.

If you are not sure whether you have exposure in either state, a nexus review will answer the question. Contact Sales Tax Helper or call us at (866) 458-7966 before either deadline passes.

Frequently Asked Questions

Can I participate in both Indiana and Illinois amnesty? Yes. They are separate programs run by separate state agencies. Participating in one has no effect on your eligibility for the other.

I have a payment plan with Indiana already. Can I still use amnesty? Indiana's eligibility rules focus on whether you participated in the 2005 or 2015 Indiana amnesty programs, not on whether you currently have a payment arrangement. Review your specific facts with a tax professional before assuming eligibility.

What happens if I miss Indiana's September 9 deadline? Indiana has stated that eligible taxpayers who do not participate will face an additional penalty on those periods. The interest waiver also disappears. The underlying liability does not go away. It becomes more expensive.

Should I use amnesty if I am currently being audited? Possibly. If amnesty can close the audit at a favorable number, it may be the right path. If you have legitimate defenses on the underlying tax, evaluate those first. This decision requires analysis specific to your situation.

I am based outside Indiana and Illinois. Do these programs apply to me? Yes. Both programs cover out-of-state sellers with economic nexus obligations. Whether you had sales tax obligations in those states for the covered periods is the key question, not where your business is headquartered.

About the Author

Gerald J. Donnini II is a sales tax attorney with 15+ years of experience and the founder of Sales Tax Helper. He has represented businesses in 1,000+ audits and disputes across 40+ states, saved $500M+ in assessments, and holds an LLM in Taxation from NYU. He is co-author of a CCH treatise on state sales and use tax.