Does a landlord who leases shared suite space to two alcoholic-liquor distributors have to register with the Department as a 'warehouseman' and obtain a Certificate of Registration?

Plain-English summary

A landlord asked the Illinois Department of Revenue whether it really had to obtain a "Warehouseman Certificate" just because two alcoholic-liquor distributors happened to share the same leased business suite in its building. The landlord argued it wasn't really operating a warehouse — no moving, packing, or shipping, and no ability to monitor how much wine its tenants brought in or took out.

The Department disagreed. Under Article VII-A of the Liquor Control Act of 1934 (235 ILCS 5/1-1 et seq.), anyone who stores alcoholic liquors — a term that expressly includes wine — for compensation must get a Certificate of Registration from the Department for each location where the liquor is stored. The Department's rule defines "warehouseman" broadly to include any person, firm, or corporation that owns, controls, operates, manages, or leases a warehouse, and defines "warehouse" broadly too: any room, structure, or building where someone else's property is stored for compensation. "Compensation" itself is defined broadly as any direct or indirect charge for storage — which the Department read to include rent collected from tenants who store alcoholic liquor on the premises.

Because the landlord was leasing suite space to a wine importer/distributor and another distributor, the Department concluded the landlord fell within the definition of "warehouseman" and would need to register and file the required monthly returns, even though the space was a shared business suite rather than a dedicated warehouse. As with all GILs, this is general guidance, not a binding decision — the letter notes the landlord could request a binding Private Letter Ruling instead.

What this means for you

Landlords and property owners leasing to alcohol distributors

If you lease space to a tenant that stores alcoholic liquor (including wine) there for compensation — even indirect compensation like ordinary rent — you may be considered a "warehouseman" under the Liquor Control Act and required to register with the Department and file monthly reports on liquor received and delivered at that location, regardless of the space's size or whether you think of it as a "warehouse."

Alcoholic-beverage distributors and importers

If you rent shared suite space from a landlord alongside another distributor, be aware that your landlord may face a registration obligation because of where you store your product. It can be worth discussing responsibility for the Certificate of Registration and monthly filings in your lease.

Accountants and tax professionals

The key legal hooks are the broad definitions in 86 Ill. Adm. Code 420.120(e): "warehouseman," "warehouse," and "compensation" are all defined expansively, and "alcoholic liquors" under 235 ILCS 5/1-3.05 includes wine. A GIL like this one is not binding, so a client facing real registration exposure may want to pursue a binding Private Letter Ruling under 2 Ill. Adm. Code 1200.110 instead of relying on this letter.

Common questions

Q: Does a landlord have to physically handle or monitor the liquor to be considered a "warehouseman"?
A: No. The Department's regulations define "warehouseman" to include anyone owning, controlling, operating, managing, or leasing a warehouse, and "storage for compensation" covers any direct or indirect charge for storage — the landlord in this case wasn't required to actively track quantities to fall within the definition.

Q: Does it matter that the space was a shared business suite rather than a traditional warehouse?
A: No. "Warehouse" is defined broadly as any room, house, structure, building, place, yard, or protected enclosure where another's property is stored for compensation — it isn't limited to large dedicated warehouse buildings.

Q: What does a registered warehouseman have to file with the Department?
A: A monthly return covering the preceding month, listing the warehouseman's name and Certificate of Registration number, the warehouse address, and detailed information about alcoholic liquors received and delivered (names/addresses of the parties, dates, and container counts/sizes). A return must be filed even for months when no liquor was in storage.

Q: Is this GIL a final, binding answer for this landlord?
A: No. A General Information Letter directs a taxpayer to relevant regulations but is not a statement of Department policy and is not binding. The Department noted the landlord could instead request a binding Private Letter Ruling under 2 Ill. Adm. Code 1200.110 if it wanted a decision it could rely on.

Q: Does "alcoholic liquors" under this Act include wine?
A: Yes. 235 ILCS 5/1-3.05 defines "alcoholic liquors" to include wine, so a person storing wine for compensation is storing alcoholic liquor for purposes of the warehouseman registration requirement.

Citations and references

Statutes and rules:

• 235 ILCS 5/1-1 et seq. (Liquor Control Act of 1934, Article VII-A)
• 235 ILCS 5/7A-2 (registration requirement for warehousemen)
• 235 ILCS 5/1-3.05 (definition of "alcoholic liquors")
• 86 Ill. Adm. Code 420.120(a) (Certificate of Registration)
• 86 Ill. Adm. Code 420.120(e)(1)-(3) (definitions: warehouseman, warehouse, compensation)
• 86 Ill. Adm. Code 420.120(b)(1)-(11) (required monthly return contents)
• 86 Ill. Adm. Code 130.2170 (warehousemen under Retailers' Occupation Tax rules)
• 2 Ill. Adm. Code 1200.110 (Private Letter Ruling procedure)
• 2 Ill. Adm. Code 1200.120 (GILs are not binding on the Department)

Source

• Landing page: https://taxarchive.illinois.gov/research/legal/letter-rulings/sales-tax/2022.html
• Original PDF: https://tax.illinois.gov/content/dam/soi/en/web/taxarchive/research/legal/letter-rulings/sales-tax/2022/st22-0004-gil.pdf

Original ruling text

ST-22-0004 02/23/2022 LIQUOR TAX
Under Article VII-A of the Liquor Control Act of 1934 (235 ILCS 5/1-1 et seq.),
every warehouseman in Illinois who stores any alcoholic liquors for
compensation shall make application to the Department for a Certificate of
Registration for each location where alcoholic liquors are stored. See 86 Ill. Adm.
Code 420.120. (This is a GIL).
February 23, 2022
Dear NAME:
This letter is in response to your letter dated September 23, 2021, in which you
requested information. The Department issues two types of letter rulings. Private Letter
Rulings (“PLRs”) are issued by the Department in response to specific taxpayer
inquiries concerning the application of a tax statute or rule to a particular fact situation.
A PLR is binding on the Department, but only as to the taxpayer who is the subject of
the request for ruling and only to the extent the facts recited in the PLR are correct and
complete. Persons seeking PLRs must comply with the procedures for PLRs found in
the Department’s regulations at 2 Ill. Adm. Code 1200.110. The purpose of a General
Information Letter (“GIL”) is to direct taxpayers to Department regulations or other
sources of information regarding the topic about which they have inquired. A GIL is not
a statement of Department policy and is not binding on the Department. See 2 Ill. Adm.
Code 1200.120. You may access our website at www.tax.illinois.gov to review
regulations, letter rulings and other types of information relevant to your inquiry.
The nature of your inquiry and the information you have provided require that we
respond with a GIL. In your letter you have stated and made inquiry as follows:
Subject: Request of Legal opinion related to “Warehouseman certificate”
as indicated at the Illinois Department of Revenue Regulations Title 86
Part 420 Section 420.120 Warehousing of Liquors.
We are writing this letter to you to address the requirement of a
Warehouseman Certificate for our property located at ADDRESS. On
DATE an agent for the Illinois Liquor Control Commission performed the
inspection of the leased suite per the normal procedure to release a new
license. The agent noted that there is an existing tenant in the same suite
and with BUSINESS1, there will be now be two distributors in the same
business suite. In an email sent DATE, the Illinois Liquor Control
Commission communicated that LESSOR (landlord) must obtain a
“warehouse certificate”: “The certificate is required for properties where
more than one distributor is warehousing alcoholic products. These
certificates are only issued by the Illinois Department of Revenue.”
We as landlords are not aware that a warehouse certificate would be
required for having both tenants in the same suite. The company that
currently occupies the suite is a wine importer and distribution company

NAME
Page 2
February 23, 2022
(BUSINESS2). In the month of DATE LESSOR signed a similar lease
contract with another company (BUSINESS1). This lease is for both
tenants to occupy the same business suite located in our building.
Because of this we as landlords are now required to obtain the
Warehouseman Certificate, however we are uncertain on who is required
to manage the warehouseman certificate and why this is being required as
they are both in the same suite not a large warehouse.
We respectfully disagree with this narrow interpretation of the law that
requires us to obtain a warehouseman certificate and file monthly data
related to the quantity of wine that is stored (quantity of wines that are
received by the two distributors that are renting a shared warehouse
space). LESSOR does not check the quantity of the wine that arrives in
the warehouse rented by the two distributors; there is no way LESSOR
can monitor the product stored by the two distributors sharing a suite. Our
building is not a large warehouse, there are individual suites, therefore, we
do not do the typical work of a warehousing company (moving, packing,
shipping, see Title 86 part 130 section 130.2170 warehousemen of the
Illinois Department of Revenue Regulations).
In conclusion, we are asking you to exempt the requirement of the
Warehouseman certificate for our property as we as landlords do not have
a way of monitoring and regulating what products our tenants are bringing
in and taking out of their private business suite. We feel this reporting
shall be the sole responsibility of the tenant and not the landlord.
Thank you for considering our request to be categorized as a
lessor/lessee relationship and exempt from the requirement of obtaining a
Warehouseman certificate. Please feel free to reach out to me if you have
any questions or want to discuss this matter further.
DEPARTMENT’S RESPONSE:
Under Article VII-A of the Liquor Control Act of 1934 (235 ILCS 5/1-1 et seq.),
every warehouseman in Illinois who stores any alcoholic liquors for compensation shall
make application to the Department for a Certificate of Registration for each location
where alcoholic liquors are stored. See 35 ILCS 5/7A-2; 86 Ill. Adm. Code 420.120(a).
The term “alcoholic liquors” is defined under the Act to include wine. See 235 ILCS 5/13.05. A warehouseman is “any person, firm, partnership, association or corporation
owning, controlling, operating, managing or leasing any warehouse within this State”. A
warehouse includes “any room, house, structure, building, place, yard or protected
enclosure wherein personal property belonging to another is stored for compensation”.
Providing storage for compensation means “any direct or indirect charge for storage”.
See Section 420.120(e)(1)-(3). Therefore, a person who stores wine belonging to

NAME
Page 3
February 23, 2022
another for a charge in Illinois is considered a warehouseman storing alcoholic liquors
for compensation and must be in possession of a Certificate of Registration from the
Department.
The certificate must be conspicuously displayed on the premises for which it is
issued. Every warehouseman holding a Certificate of Registration issued by the
Department is required to file a monthly return with the Department and covering the
preceding month which states:
1)
2)
3)
4)

The name of the warehouseman;
the number of his Certificate of Registration;
the address of the warehouse;
the name and address of each person from whom any alcoholic liquors
were actually or constructively received by him as a warehouseman;
5) the date or dates on which such alcoholic liquors were so received;
6) the number and size of the containers in which any alcoholic liquors were so
received;
7) the number and size of the containers to the credit of each such person at
the end of the preceding calendar month;
8) the name and address of each person to whom any alcoholic liquors were
actually or constructively delivered by him as a warehouseman;
9) the date or dates on which the same were so delivered;
10) the number and size of the containers in which any alcoholic liquors were so
delivered; and
11) from whom any alcoholic liquors so delivered were actually or constructively
received.

If no liquors were in storage in any month, the return must still be filed so indicating.
See 86 Ill. Adm. Code 420.120(b)(1)-(11).
Your letter indicates that you are currently leasing space to a wine importer and
distribution company and another distributor. Based on the limited information you have
provided, it appears you fall within the definition of “warehouseman” under the Liquor
Control Act of 1934, and you would be required to register with the Department as a
warehouseman. If you would like a binding decision in this matter, you may submit a
request for a Private Letter Ruling to the Department. See 2 Ill. Adm. Code 1200.110.
I hope this information is helpful. If you require additional information, please
visit our website at www.tax.illinois.gov or contact the Department’s Taxpayer
Information Division at (217) 782-3336.
Very truly yours,

NAME
Page 4
February 23, 2022
Alexis K. Overstreet
Associate Counsel
AKO/ld