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As we announced in our May 31 End of Session Report, one of the so-called budget solutions enacted by the Illinois General Assembly last Spring (Public Act 103-592) was to cap the retailers’ collection allowance for timely payment of sales tax at $1,000 per month.  Currently, retailers’ can retain a collection allowance of 1.75% of sales tax timely paid to the Illinois Department of Revenue, but once P.A. 103-592 becomes effective, the collection allowance may not exceed $1,000 per month.  
General Merchandise reported on Form ST-1 (parts) and motor vehicle sales and leases reported on Forms ST-556 and ST-556-LSE are subject to separate caps, meaning most dealers will be able to claim $2,000 month total in retailers’ collection allowance.  
Form ST-1 is due on a monthly basis, so claiming the retailers’ collection allowance is a fairly straightforward matter of claiming 1.75% of the tax remitted or $1,000, whichever is less, beginning with ST-1 returns due on and after January 1, 2025.  Additional guidance here: FY 2025-04, Retailers’ Discount for Certain Tax Returns Capped at $1,000 Per Month
Each motor vehicle purchase and lease transaction is subject to a transaction-by-transaction filing requirement, making it more complicated to determine when the $1,000 threshold has been reached.  Beginning with sales and leases delivered on December 12, 2024, motor vehicle dealers will no longer claim the retailers’ collection allowance on Forms ST-556 and ST-556-LSE.  Instead, IDOR will make a monthly reconciliation of dealer returns and calculate the appropriate retailers’ collection allowance for each dealer.  Dealers can elect to receive their retailers’ collection allowance by check or by direct deposit.  
IDOR has provided the following guidance: FY 2025-11, Retailers’ Allowance for Certain Transaction Returns Capped at $1,000 Per Month.  IADA has been working with CVR to make the necessary programming modifications.  Please feel free to contact the IADA Office if you have any questions.

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    Federal Court Strikes Down White Collar Employee Overtime Expansion
On November 15th, a Texas Federal Court struck down a U.S. Department of Labor rule that scaled back the Overtime Exemption for "White Collar" Employees.
As IADA reported in our April 24th bulletin, the U.S Department of Labor adopted regulations to reduce the number of employees who qualify for the "white collar" overtime exemption. The rule included a 2-step implementation, first on July 1, 2024, and again on January 1, 2025. 
Until July 1, 2024, certain executive, administrative, professional, and computer "white collar" employees (EAP employees), including managers and assistant managers, office managers, human resources professionals, controllers, accountants, attorneys, and computer specialists, who earn more than $684 per week ($35,568 per year) were not entitled to overtime compensation for work in excess of 40 hours per week.  On July 1, 2024, the salary threshold increased to $844 per week ($43,888 per year). The salary threshold was set to increase again on January 1, 2025, to $1,128 per week ($58,656 per year).
As a result of Texas decision the January 1, change will not occur and, in fact, the salary level will revert to the pre-July 1, 2024 level of $684 per week ($35,568 per year).
The now invalidated rule made similar changes to the overtime exemption for “highly-compensated employees” by raising the salary threshold from $107,432 to $139,964 on July 1st with another increase, to $151,164, set for January 1, 2025.  The salary level for highly-compensated employees has been restored to the pre-July 1st level of $107,432. 
Additional information is available on NADA’s website at: Search | NADA.

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    Locally Imposed Sales Tax Changes Effective January 1st
Beginning January 1, 2025, the rates of certain locally imposed sales taxes that are administered by the Illinois Department of Revenue will change. Please refer to the attached bulletin from the Illinois Department of Revenue to see if you are affected. Please note that these sales tax rate changes apply only to general merchandise and do not apply to vehicles. The Department of Revenue bulletin outlining the sales tax increases can be found here.

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    Legal Reminder: Statewide Minimum Wage Increases To $15/Hour On January 1, 2025
The statewide minimum wage will increase from $14.00 per hour to $15.00 per hour on January 1, 2025. The current minimum wage in Chicago $16.20 per hour.
Illinois employers are advised to review their pay plans to make sure that they meet minimum wage obligations.

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    NADA Main Issues Updates
NADA met recently with their directors from across the country to discuss current legislative, regulatory and OEM issues.  Our IADA Board Members and NADA Directors, Ryan Gremore, O'Brien Auto Group, Normal, and Joe Massarelli, Liberty Auto City, Libertyville, provided the NADA Main Issues Updates for Directors - November 2024.  We would like to thank Ryan and Joe for their double-duty work for both associations as they battle for our members and the industry!
Issues covered:
Volkswagen/Scout (New)
FTC’s Vehicle Shopping Rule (Updated)
EPA’s De Facto EV Mandate
Phase 3 Emissions Rule for Heavy-Duty Trucks (Updated)
So-Called “Right to Repair” Legislation
Catalytic Converter Anti-Theft Legislation
Stellantis
Hyundai
Hyundai-Amazon
Sony/Honda
We've also included links to:
Q4 Economic Report by NADA Chief Economist, Patrick Manzi
Presidio Group Market Update 

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    Are You Maximizing the Value of Partnership?
IADA-CVR understands that stability and adaptability are key to your dealership's success. With a robust foundation of technology paired with personalized service and support, CVR helps your dealership’s EVR operations thrive each and every day.
Proactive Planning
Consistent Performance
Dedicated Support
Innovation at Work
CVR’s strong foundation and deep-rooted history in our state allows Illinois dealers to build higher. Together, we grow with…
Standing the Test of Time
Innovation Built for You
Unmatched Account Support
Strategic Relationships Make all the Difference
Take a few minutes to click here and learn more, or contact IADA.

                  
                
              
            
            
          
        
      
    
  
  
 
  
  
    
      
        
          
            
            
              
                
                  
                    
    IRS Clean Vehicle Credit—New Tool for Voiding and Cancelling Submissions
The IRS has added two features to the Clean Vehicle Tax Credit Portal.  Dealers will be able to cancel submissions that are more than 48 hours if a transaction falls through for some reason and the vehicle is not placed in service.  Such a cancellation request must be submitted by November 25th.  After IRS completes its review of a cancellation request, if approved, the vehicle will qualify for a clean vehicle credit if sold to a qualifying buyer.  If the transaction is less than 48 hours old, you must use the VOID feature instead of the cancellation feature.
Additionally, starting on November 25th through December 10th, IRS will permit dealers to submit time of sale reports for any 2024 transactions that were not timely submitted at the time of sale.
Additional information is available on the IRS website at: The IRS ECO tool will be open for dealers to temporarily submit time of sale reports for any prior unsubmitted calendar year 2024 transactions.