Chicago's sales tax rate and what it covers
Chicago's combined sales tax is 10.25 percent. This rate is made up of the Illinois state sales tax (6.25 percent), Cook County tax (1.25 percent), and the city of Chicago tax (2.25 percent). When you buy something in Chicago, the seller adds all three taxes together and charges you that total.
The 10.25 percent rate applies to most goods you buy in stores — clothing, electronics, groceries (with exceptions), household items, and furniture. It also applies to prepared food, restaurant meals, and takeout. If you buy something online and have it shipped to a Chicago address, you typically owe Chicago sales tax on that purchase too, though the responsibility to collect it falls on the seller.
Some items are taxed at a lower rate or not taxed at all. Unprepared groceries — raw meat, produce, dairy, bread, and canned goods you cook yourself — are taxed at 1 percent instead of the full rate. Prescription medications are not taxed. Clothing and shoes under $110 per item are exempt from the state portion of the tax, which means you pay only the local portion (3.5 percent) on those items.
Key Takeaways
- Chicago's total sales tax is 10.25 percent, combining state (6.25 percent), county (1.25 percent), and city (2.25 percent) taxes.
- Unprepared groceries are taxed at 1 percent, while prepared food and restaurant meals are taxed at the full 10.25 percent rate.
- Clothing and shoes under $110 per item pay only the local portion (3.5 percent) instead of the full rate.
- Prescription medications and certain medical equipment are not subject to sales tax in Illinois.
How the tax breaks down by source
The Illinois state sales tax of 6.25 percent is set by the state legislature and applies everywhere in Illinois. Cook County adds 1.25 percent on top of that. Chicago itself adds another 2.25 percent. Each layer funds different services — the state portion goes to general state revenue, the county portion supports county services, and the city portion funds Chicago city services.
If you buy something outside Chicago but still in Cook County, you pay 7.5 percent (state 6.25 percent plus county 1.25 percent) but not the city tax. If you buy something in Illinois outside Cook County, you pay only the state 6.25 percent plus whatever local tax that area has. This is why the same item can cost different amounts depending on where you purchase it.
What happens when you buy online
Online retailers are required to collect and send Chicago sales tax if they have a physical presence in Illinois or meet certain sales thresholds set by federal law. Large retailers like Amazon, Walmart, and Target collect Chicago sales tax on orders shipped to Chicago addresses. Smaller sellers may not, depending on their sales volume and whether they have warehouses or offices in the state.
If you buy from an out-of-state seller who does not collect the tax, you are technically responsible for reporting and paying the tax yourself on your Illinois tax return. In practice, most people do not do this, and the state does not actively pursue individual consumers for this amount. However, the legal obligation exists.
Items that are fully or partially exempt
Beyond groceries, clothing under $110, and medications, several other categories have special treatment. Newspapers and magazines are not taxed. Certain medical devices and equipment prescribed by a doctor are exempt. Items purchased for resale by a business are not taxed (the business collects tax from the end customer instead).
Services are generally not taxed in Illinois, which is why haircuts, car repairs, and plumbing work do not have sales tax added. However, if you buy a product as part of a service — like paint that a contractor applies to your house — the product portion may be taxable depending on how the invoice is written.
Sales tax on specific categories
Restaurant meals and prepared food are taxed at the full 10.25 percent. This includes takeout, delivery, and food from a deli counter. The distinction is whether the food is ready to eat or requires cooking. A rotisserie chicken from a grocery store is prepared food and taxed; raw chicken breasts are not.
Alcohol is taxed at the full rate plus an additional state excise tax on beer, wine, and liquor. Gasoline has a state excise tax but is not subject to the standard sales tax. Hotel rooms in Chicago are subject to sales tax plus an additional hotel tax that varies by location within the city.
Digital goods like e-books, streaming subscriptions, and downloaded software are taxed at the full rate if purchased by a Chicago resident. Streaming services like Netflix and Spotify charge Chicago sales tax on subscriptions.
How to verify the tax on your receipt
When you receive a receipt, the sales tax should be listed as a separate line item. You can verify it by multiplying the subtotal by 0.1025 (or 10.25 percent). If the item is clothing under $110, the tax should be lower — multiply by 0.035 (3.5 percent) instead. If it is unprepared groceries, multiply by 0.01 (1 percent).
If the tax appears incorrect, check whether the item falls into an exempt or reduced-tax category. Clothing items over $110 are taxed on the full amount, not just the portion above $110. If you believe a mistake was made, ask the cashier or contact the store's customer service with your receipt.
Frequently Asked Questions
Do I pay Chicago sales tax if I buy something online from out of state?
If the seller has a physical presence in Illinois or meets federal sales thresholds, they must collect Chicago sales tax on orders shipped to Chicago. If they do not collect it, you are technically responsible for reporting it on your tax return, though enforcement for individual consumers is rare.
Is clothing always exempt from sales tax?
Only clothing and shoes under $110 per item are partially exempt — they pay the local portion (3.5 percent) but not the state portion. Items over $110 pay the full 10.25 percent. Accessories like belts, hats, and jewelry are taxed at the full rate regardless of price.
Why is prepared food taxed differently than groceries?
Illinois taxes unprepared groceries at 1 percent to keep basic food affordable. Prepared food — anything ready to eat or requiring only heating — is considered a service and taxed at the full rate. This applies to restaurant meals, deli items, and takeout.
Do I pay sales tax on prescription medications?
No. Prescription medications are exempt from sales tax in Illinois. Over-the-counter medications like pain relievers and cold medicine are taxed at the full rate, so check your receipt to see which category the item fell into.
What if a store charges me the wrong sales tax amount?
Ask the cashier to recalculate or contact the store's management. Keep your receipt and verify the math yourself using the appropriate tax rate for that item category. Most errors are honest mistakes and stores will correct them if you point them out.