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Manufacturer's Purchase Credit (MPC)

Manufacturer’s Purchase Credit (MPC) sunset on August 30, 2014.

  • MPC cannot be earned on purchases with an invoice date of August 31, 2014 or later.
  • Taxpayers must have filed the required earning report (ST-16 MPC, Annual Report of Manufacturer’s Purchase Credit Earned) by June 30, 2015 to report the MPC earned for periods between January 1 and August 30, 2014. 
  • Taxpayers must have filed the required usage report (ST-17 MPC, Annual Report of Manufacturer’s Purchase Credit Used) to report the MPC used during calendar year 2014 by June 30, 2015.  If the taxpayer had remaining MPC that was used in subsequent years, the taxpayer must have filed the ST-17 by June 30th of the year following usage.
  • Taxpayers may use any available MPC until it expires (which, if properly reported, is on December 31st of the second calendar year following the calendar year in which it was earned).
    In general, you cannot claim MPC credit on Form ST-1 for any reporting period after December 31, 2016.
    NOTE: This notice supersedes the provisions of the MPC regulation (86 Ill. Adm. Code 130.331), which inadvertently prohibited the usage of MPC on and after August 31, 2014. Section 130.331 is being amended to reflect the provisions of this notice.
  • Taxpayers can use available MPC to pay production-related audit liability.

Statutory References


Beginning September 1, 2004, and sunsetting August 30, 2014, qualifying manufacturers could earn a Manufacturer's Purchase Credit (MPC). The MPC was earned when a manufacturer purchased manufacturing or graphic arts machinery and equipment that qualified for the existing sales/use tax exemptions. MPC could be used to pay state sales or use tax on future purchases of qualifying production-related tangible personal property.

All unused MPC expires the last day of the second calendar year following the year in which the original tax-exempt purchase was made. MPC may not be transferred to another party.


The MPC was equal to half of the 6.25% state tax that would have been owed if the purchase had not otherwise been exempt.

Forms/Filing Requirements