Does a mobile home park owner/dealer owe Illinois sales tax when it resells a used, previously-titled manufactured home out of its park inventory?

Plain-English summary

A company planning to acquire Illinois mobile home parks wanted to become a licensed manufactured-home dealer and buy and sell used manufactured homes to park residents. Its planned deal: buy a used home from a private individual (no sales tax paid, since that seller isn't a dealer), move the home into one of the company's own mobile home parks, and then sell it to a new resident. Because the home had already been titled to several prior owners, the company argued this wasn't a "first retail sale" and asked whether it could treat the resale to the new resident as exempt -- pointing out that in some other states, only the very first sale of a manufactured home by a dealer is taxed, and later resales of used homes are not.

The Department's answer, grounded in the Manufactured Home Installation Act (35 ILCS 517/5): manufactured homes located inside a mobile home park are legally classified as chattel (personal property), not real estate. That classification drives how sales tax reporting works. Two separate transactions matter here, and they're taxed differently:

1. The company's purchase from the private individual. A one-time sale by someone who doesn't hold themselves out as being in the business of selling manufactured homes is a non-taxable "isolated or occasional sale" -- no Retailers' Occupation Tax is owed on that purchase, and correspondingly the company owes no Use Tax on it either.
2. The company's sale out of its own park inventory. Once the company (now a licensed dealer) places that home in its mobile home park, it's treated the same as inventory purchased tax-free for resale. When the company then sells the home to a purchaser like a new resident, THAT sale is a taxable retail sale, reported with Retailers' Occupation Tax paid on Form ST-556 (the Sales Tax Transaction Return used for these sales). Critically, the Department specified that each SUBSEQUENT sale of that same home by the park owner to a later purchaser must also be reported and taxed on Form ST-556 -- the used, previously-titled status of the home doesn't exempt the dealer's own retail sale from tax.

In short: the "no tax on a used home resale" idea the company was counting on doesn't survive once the company itself becomes the dealer selling the home out of its inventory. The exemption that mattered here was on the company's own PURCHASE (isolated sale from a private party), not on its later SALE to a customer.

What this means for you

Manufactured-home dealers and mobile home park owners

If you buy a home from a private individual who isn't in the business of selling homes, that purchase itself is untaxed (isolated/occasional sale). But once you resell that home out of your own inventory as a licensed dealer, that sale is taxable and must be reported on Form ST-556 -- regardless of whether the home is new or was previously owned and titled to someone else. Don't assume a "used home" characterization gets you out of collecting and remitting tax on your own retail sale.

Buyers of manufactured homes in a mobile home park

Expect Retailers' Occupation Tax to apply on Form ST-556 when you buy a manufactured home from a licensed dealer/park owner, even if the home has had prior owners. Ask your dealer how the sale is being reported.

Accountants and tax professionals advising multi-state manufactured-home operators

Illinois's rule differs from some other states' "only the first sale is taxed" approach for manufactured homes. Confirm Illinois-specific treatment separately rather than assuming a client's home-state rule transfers here -- Illinois taxes the mobile-home-park owner/dealer's OWN sale each time it sells a home out of park inventory.

Common questions

Q: If I buy a used manufactured home from a private individual, do I owe sales tax on that purchase?
A: No. A one-time sale by someone not in the business of selling such property is a non-taxable isolated or occasional sale, so no Retailers' Occupation Tax applies to that purchase, and no Use Tax applies either.

Q: If I then resell that same used home from my mobile home park, is that sale taxable?
A: Yes. Once you're a licensed dealer selling a manufactured home out of your park inventory, that sale -- and each later resale of the same home by you -- is a taxable retail sale reported with tax paid on Form ST-556.

Q: Does it matter that the home was previously titled to other owners, not new?
A: No. The Department's answer didn't tie the taxability of the dealer's sale to whether the home was new or used/previously titled -- what matters is that the dealer is selling it out of inventory as a retail sale.

Q: Are manufactured homes inside a mobile home park taxed as real estate?
A: No. The Manufactured Home Installation Act classifies homes located in a mobile home park as chattel (personal property), which is why they're handled under sales tax law (Form ST-556) rather than real property tax rules. Homes located OUTSIDE a mobile home park are instead assessed and taxed as real property.

Citations and references

Statutes:

• 35 ILCS 517/5 (Manufactured Home Installation Act -- chattel classification of homes in mobile home parks)
• 35 ILCS 120/3 (Retailers' Occupation Tax Act -- Form ST-556 reporting requirement)

Regulations:

• 86 Ill. Adm. Code 130.101 (Retailers' Occupation Tax imposition)
• 86 Ill. Adm. Code 130.110 (isolated or occasional sales exclusion)
• 86 Ill. Adm. Code 130.120(c), 130.1405 (tax-free purchase for resale / resale certificates)
• 86 Ill. Adm. Code 150.101(d) (corresponding Use Tax treatment)

Source

• Landing page: Illinois 2026 Sales Tax Letter Rulings
• Original PDF: ST26-0001-GIL.pdf

Original ruling text

ST 26-0001-GIL

01/09/2026

MANUFACTURED HOMES

Mobile homes and manufactured homes in mobile home parks must be assessed
and taxed as chattel. See 35 ILCS 517/5. The first sale by the mobile home park
owner of the manufactured home located in the mobile home park to a purchaser is
reported with Retailers’ Occupation Tax paid on Form ST-556, Sales Tax Transaction
Return. Each subsequent sale of the manufactured home by the mobile home park
owner to another purchaser must also be reported with tax paid on Form ST-556.
(This is a GIL).
January 9, 2026
NAME
TITLE
COMPANY
ADDRESS
Email: EMAIL
Dear NAME:
This letter is in response to your letter dated October 22, 2025, 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 https://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:
Our firm represents a mobile home park owner/operator (“Company”)
looking to acquire mobile home parks in Illinois. As part of this business, the
Company intends to become a licensed IL manufactured home dealer and
then buy and sell manufactured homes to its customers.
We request clarification regarding the application of the Illinois
Retailers’ Occupation Tax (“ROT”) on the sale of used manufactured homes
to private individuals.

COMPANY
Page 2
January 9, 2026
Assumed Facts:
• Company is a licensed retailer in Illinois.
• Company purchases a MAKE/MODEL manufactured home with
VIN 123abc (the “Home”) from Jane Doe, who is not a dealer.
No sales tax was paid at time of purchase from Ms. Doe.
• The Home was titled in IL in Jane Doe’s name immediately prior
to the Company’s purchase, and is now titled in the name of
Company.
• Company relocates home and installs Home in Company’s
mobile home park, and then sold to John Smith. (The Home has
been blocked, anchored, and tied down. Wheels and axels are
still on the home, though the wheels are not touching the
ground. Thus “without installation.”)
• Mr. Smith recently vacated an apartment he rented, and thus
there is no trade-in as part of the purchase of Home.
• Mr. Smith will take title in his name and keep the Home in the
mobile home park. The Home will remain personal property and
will not be legally affixed to real estate.
• The Home is used and was previously titled, to several prior
owners, therefore this is not a first retail sale of the Home.
• The Home will be subject to annual tax as set out in the Mobile
Home Local Services Tax Act.
Question:
Under PIO-123 (Reporting Taxable Sales of Manufactured Homes),
sales of manufactured homes without installation are taxable unless they
qualify for one of the exemptions listed (sale for resale to a dealer, sale to an
exempt organization, or delivery outside Illinois). Is the sale of a used Home
considered a taxable “sale at retail”?
We request clarification whether the sale of a used, previously titled
manufactured home to a private individual in Illinois is subject to ROT, or
whether it is exempt from sales tax on the basis that it is a resale of a
previously titled home. As an aside, the Company operates in several other
states and “used home sales” are not subject to sales tax, but only the initial
sale of a home from a dealer to an end-customer is taxable (and the
Manufacturer’s Certificate of Origin goes away and the home thereafter is
transferred via “vehicle” title.)
Supporting Information:
• Relevant statutes: 35 ILCS 120/1 et. Seq. (Retailers’ Occupation
Tax Act) and 35 ILCS 515 (Mobile Home Local Services Tax Act.)

COMPANY
Page 3
January 9, 2026
•

PIO-123 guidance does not explicitly address resale of
previously titled home to private buyers.

We respectfully request a written ruling clarifying whether ROT applies
to this type of transaction, and any documentation or procedures required to
demonstrate compliance.
DEPARTMENT’S RESPONSE:
The Illinois Retailers’ Occupation Tax Act imposes a tax upon persons engaged in this
State in the business of selling tangible personal property at retail to purchasers for use or
consumption. See 86 Ill. Adm. Code 130.101. In Illinois, Use Tax is imposed on the privilege
of using, in this State, any kind of tangible personal property that is purchased anywhere at
retail from a retailer. See 86 Ill. Adm. Code 150.101. These taxes comprise what is
commonly known as “sales” tax in Illinois.
The Manufactured Home Installation Act provides that “[m]obile homes and
manufactured homes in mobile home parks must be assessed and taxed as chattel. Mobile
homes and manufactured homes outside of mobile home parks must be assessed and
taxed as real property.” See 35 ILCS 517/5. The Act provides that “mobile home” and
“manufactured home” mean the same thing for the purposes of the Act. The Act defines
“mobile home park” as a tract of land or 2 contiguous tracts of land that contain sites with
the necessary utilities for 5 or more mobile homes or manufactured homes. This statutory
designation of manufactured homes in mobile home parks as chattel impacts the reporting
and payment of tax by mobile home park owners when they sell manufactured homes
located in mobile home parks.
Isolated or occasional sales of tangible personal property at retail by persons who do
not hold themselves out as being engaged (or who do not habitually engage) in selling such
tangible personal property at retail do not constitute engaging in the business of selling such
tangible personal property at retail. See 86 Ill. Adm. Code 130.110. A person who makes a
one-time sale of a manufactured home would not incur Retailers’ Occupation Tax liability
on that sale because it would constitute a non-taxable isolated or occasional sale. See 86
Ill. Adm. Code 130.110. Consequently, the purchaser of that manufactured home would not
incur a corresponding Use Tax liability on that purchase. See 86 Ill. Adm. Code 150.101(d).
When a mobile home park owner purchases the manufactured home from the
manufacturer to be installed in a mobile home park and subsequently sold to a purchaser,
the purchase from the manufacturer is a tax-free purchase for resale and a certificate of
resale must be presented to the manufacturer. 86 Ill. Adm. Code 130.120(c), 130.1405. The
placement of the manufactured home in the mobile home park by the mobile home park
owner after purchase is the equivalent of placing the manufactured home in the mobile

COMPANY
Page 4
January 9, 2026
home park owner’s inventory. The first sale by the mobile home park owner of the
manufactured home located in the mobile home park to a purchaser is reported with
Retailers’ Occupation Tax paid on Form ST-556, Sales Tax Transaction Return. See 35 ILCS
120/3. Each subsequent sale of the manufactured home by the mobile home park owner to
a future purchaser must also be reported with tax paid on Form ST-556.
I hope this information is helpful. If you require additional information, please visit
our website at https://tax.illinois.gov/ or contact the Department’s Taxpayer Information
Division at 800-732-8866.

Very truly yours,

George L. Encarnacion, Jr.
Associate Counsel
GLE:sce