Apply for a Direct Pay Permit

Direct Pay is an arrangement between the Illinois Department of Revenue (IDOR) and taxpayers which represents a cost-saving alternative to traditional sales and use tax compliance methods. Direct Pay is a term often used interchangeably with Managed Compliance Agreement (MCA) or Single Use Tax Compliance Agreement (SUTCA).  These similar arrangements are utilized by other states to simplify a taxpayer's use tax calculation and remittance.  In Illinois, approval for a Direct Pay Permit involves a thorough review process, typical of a sales and use tax audit. IDOR's Audit Bureau administers the program and addresses all related inquiries.

Under this program, approved taxpayers receive a Direct Pay Permit (ST-46).  Through established guidelines, a taxpayer is then allowed to purchase items without initially paying tax to their supplier(s) on these transactions.  Instead, the permit holder performs a monthly determination of appropriate state and local taxes due on the cumulative transactions and remits directly to the Department on their own sales tax return.

Effective on and after January 1, 2021, Direct Pay Permit holders may have changes in the rate of tax due on their purchases. To determine the tax due,  you will need to examine your purchases from out-of-state vendors (remote retailers) and purchases made over a marketplace. Remote retailers', who are now considered "Illinois retailers", and certain marketplace facilitators' sales to you are now taxable at the destination rate.

"Destination rate" means the tax due on the direct pay purchase is based on the location in Illinois to which the purchased item was shipped or delivered or at which possession was taken by you. Depending upon the location of the sale, the actual sales tax rate may be higher than the state rate of 6.25 percent because of home rule, non-home rule, mass transit, park district, flood prevention district, county public safety, public facilities or transportation, county school facility, and municipal business district tax.

Step 1: Review the following information about the program:

Step 2: Contact the Audit Bureau to request an Application (ST-45), discuss further details of the program, or direct any questions about direct pay, by emailing: