Illinois DOR Rules Security Equipment Leases Subject to Service Occupation Tax

The Illinois Department of Revenue (DOR) issued a private letter ruling holding that the sale of a service accompanied by a transfer of tangible personal property would be subject to the service occupation tax act. The DOR found that security monitoring equipment provided by the taxpayer remains tangible personal property after installation at the customer’s property and is not incorporated into real estate. The DOR ruled that the transactions constitute the sale of security monitoring services, with the equipment leased as an incident to the service, making the taxpayer’s charges subject to the service occupation tax. [Ill. Dep’t of Revenue, ...