Illinois Short-Term Rental Laws & Hotel Tax (2026)

State license required

Yes

Latest rule change

Jul 1, 2026

The laws in brief

Who needs it

Hosts in cities that require one: every Chicago shared housing unit (stays of 31 days or fewer), every Evanston and Oak Park short-term rental, and every Galena vacation rental (which also needs a special use permit).^{3,4,7,8,14,16}

Issued by

The city or village where the home stands, for example the Chicago Department of Business Affairs and Consumer Protection (BACP), the City of Evanston or the Village of Oak Park

Valid for

Chicago registrations and Evanston, Oak Park and Galena licenses run one year and are renewed annually; Oak Park licenses cannot be transferred.

On listings

The number must appear on every listing

Platform checks

Chicago requires an approved registration number to list on a platform, and the city's intermediary license obliges platforms to collect the city hotel tax; Evanston requires the license number in the listing.

Fees

Who qualifies

• Chicago: a legal dwelling unit with six or fewer sleeping rooms, outside a Restricted Residential Zone and off the Prohibited Buildings List
• Chicago: single-family homes and buildings of two to four units must be the host's primary residence, with one active rental; buildings of five or more units need not be a primary residence, up to one-quarter of units or six, whichever is less
• Chicago: no listing where the lease or homeowners association bans short-term rental
• Evanston: property maintenance inspection before the license is issued, and a letter from the homeowners association where one applies
• Oak Park: inspection and proof of at least $500,000 of homeowner's or host protection insurance
• Galena: special use permit approved by the city council, with licenses capped at 20 in residential districts and 75 in commercial districts

How to apply

1. 1 Check the rules of the city or village where the home stands; Chicago, Evanston, Oak Park and Galena each have their own application.
2. 2 Chicago: create an account on the Shared Housing Registration Portal, upload an identity document (and two primary-residency documents for a primary residence), and pay the $250 fee once the city approves the application.
3. 3 Evanston: apply online with floor plans and an evacuation diagram, pass the property maintenance inspection, then pay the $250 license fee.
4. 4 Oak Park: apply for the short-term rental business license through the Village's online licensing portal with proof of insurance, then pass the inspection.
5. 5 Register with the Illinois Department of Revenue for the Hotel Operators' Occupation Tax if you take bookings outside a platform that remits the tax.

Permit rules

Cities and villages license short-term rentals

Permits come from each city or village, which sets its own license or registration; the state's own role is the hotel tax. Evanston, for example, licenses both hosts and the platforms that list them.¹⁴

Chicago: registration number for rentals of 31 days or fewer

Every Chicago shared housing unit needs an approved registration number before it can be listed, renewed every year for $250.⁷ Applies to: Chicago

Chicago: operator license for more than one unit

A Chicago host approved for more than one shared housing registration also needs a Shared Housing Unit Operator License, with a separate registration for each unit.⁷ Applies to: Chicago

Oak Park: a license for each short-term rental

Oak Park has required a business license for every short-term rental since June 1, 2022. The license is not transferable, is renewed annually and is issued only after an inspection.^3,15 Applies to: Oak Park · In force since June 1, 2022

Evanston: license after inspection

Evanston charges a $150 application fee and, once the unit passes a property maintenance inspection, a $250 annual license; renewals are also $250.¹⁴ Applies to: Evanston

Evanston: license number in the listing

An Evanston host must put the license number in the short-term rental listing and post the license certificate, the operator's contact and an evacuation diagram inside the rental.¹⁴ Applies to: Evanston

Rockford: rental and short-term rental registry

Rockford keeps a Rental / Short-Term Rental Registry where owners register each property under the city's Residential Quality Support and Short-Term Rental ordinances.¹⁸ Applies to: Rockford

Platforms remit the state tax from July 1, 2026

Since July 1, 2026 a hosting platform with $100,000 or more of Illinois receipts in the prior 12 months is the hotel operator for the state tax and registers and remits it instead of the host.^2,11 In force since July 1, 2026

Advertised price must be the total price

Since May 12, 2025 a federal rule requires any advertised price for a short-term rental to show the total price, including mandatory fees; taxes and other government charges may be shown separately.^6,20 In force since May 12, 2025

Chicago: primary residence in homes and small buildings

In a single-family home or a building of two to four units the rental must be the host's primary residence, with one active rental. Buildings of five or more units need not be a primary residence and may rent up to one-quarter of their units or six, whichever is less.⁸ Applies to: Chicago

Chicago: no rentals in Restricted Residential Zones or listed buildings

A Chicago unit cannot be registered inside a Restricted Residential Zone or in a building on the Prohibited Buildings List.⁸ Applies to: Chicago

Chicago: lease and homeowners association bans apply

A Chicago unit cannot be listed where the rental agreement or the homeowners association prohibits short-term shared housing.⁸ Applies to: Chicago

Evanston: homeowners association attestation

Where a homeowners association applies, an Evanston host must show that its bylaws do not prohibit short-term or vacation rental use.¹⁴ Applies to: Evanston

Galena: special use permit and capped licenses

Galena allows vacation rentals only with a special use permit and an operating license, limited to 20 licenses in residential districts and 75 in commercial districts. All available licenses are taken and the city keeps a waitlist.^4,16 Applies to: Galena

1. 1. Chicago

   Cook County

   Chicago requires an approved shared housing registration number, $250 a year, for any rental of 31 days or fewer. Single-family homes and buildings of two to four units must be the host's primary residence with one active rental, and Restricted Residential Zones and listed buildings are excluded. The city showed 3,652 active registrations on October 17, 2026.^1,7,8,21

   • Registration number required to list; $250 a year, renewed annually
   • Single-family homes and buildings of 2-4 units: primary residence, one active rental; 5+ units: up to one-quarter of units or six
   • Two-night minimum and two guests per guest room
   • Taxes: 4.5% hotel accommodation tax and 6% shared housing surcharge, plus state and Cook County taxes

2. 2. Evanston

   Cook County

   Evanston licenses short-term rentals and the platforms that list them. A host pays a $150 application fee and a $250 annual license after a property maintenance inspection, and must put the license number in the listing. A February 2026 ordinance limits the number of licenses, after a moratorium on new applications.^14,19,22

   • License required; $150 application and $250 annual fee
   • Property maintenance inspection before issue and each year
   • License number must appear in the listing
   • Homeowners association letter where an association applies

3. 3. Oak Park

   Cook County

   Oak Park has required a business license for every short-term rental since June 1, 2022. The annual fee is $100 for an owner-occupied rental and $250 for a non-owner-occupied rental by a village resident, and a single rental can run from 24 hours to 182 days. Fines are $200, $500 and then $750.^3,15,22

   • License for each rental, renewed annually; $100 owner-occupied, $250 non-owner-occupied (village resident)
   • Inspection before issue; at least $500,000 of insurance
   • Stays from 24 hours to 182 days; occupancy of 3 to 13 by bedroom count
   • Fines $200, $500, then $750, counted by the day

4. 4. Galena

   Jo Daviess County

   Galena allows vacation rentals only with a special use permit and an operating license, and the city council has capped licenses at 20 in residential districts and 75 in commercial districts. All available licenses are taken and the city keeps a waitlist. The city's hotel tax is 5%, or 11% with the state rate.^4,16,17

   • Special use permit and operating license both required
   • Licenses capped at 20 residential and 75 commercial; waitlist for new applicants
   • License fees $150 initial and $130 a year; at least $500,000 of liability insurance
   • Fire, health and building inspections before the license is issued

5. 5. Rockford

   Winnebago County

   Rockford keeps a combined Rental / Short-Term Rental Registry under its Residential Quality Support Ordinance and Short-Term Rental Ordinance, where owners register each property through the city's online registry. Airbnb collects Rockford's 5% hotel/motel tourism tax on stays of 30 nights or fewer.^18,22

   • Register the property in the city's Rental / Short-Term Rental Registry
   • Registry supports the Short-Term Rental Ordinance and Residential Quality Support Ordinance
   • Hotel/motel tourism tax of 5%, collected by Airbnb

What the host still handles

• An Illinois Department of Revenue Hotel Operators' Occupation Tax account (MyTax Illinois, Form REG-1) for bookings taken outside a platform that remits the tax, such as direct bookings or a platform under the $100,000 threshold
• A city or village license or registration where the place requires one (for example the Chicago registration, the Evanston or Oak Park license)
• A local hotel tax account with the city or village where Airbnb does not collect (for example Galena)
• In Chicago, a city tax account for rentals booked on the host's own platform^{7,9,10,11,13,22}

Check permitting, zoning and safety rules where the home stands

Airbnb tells hosts to look up the permitting, zoning, safety and health rules that apply to the property before listing.²³

Chicago: six sleeping rooms or fewer

A Chicago shared housing unit must be a legal dwelling unit with six or fewer sleeping rooms.⁸ Applies to: Chicago

Chicago: two-night minimum

Chicago hosts may not rent a unit or any part of it for fewer than two consecutive nights, and never by the hour.¹ Applies to: Chicago

Chicago: two guests per guest room

Chicago caps occupancy at two persons per guest room, not counting a guest's children under 18, or the capacity the building code allows if lower.¹ Applies to: Chicago

Oak Park: stays from 24 hours to 182 days

An Oak Park owner may not rent for less than 24 consecutive hours or for more than 182 days at a time, and must market the rental through a hosting platform.³ Applies to: Oak Park

Oak Park: $500,000 of insurance

Oak Park applicants must show homeowner's or host protection insurance of at least $500,000.³ Applies to: Oak Park

Oak Park: occupancy set by bedroom count

Oak Park allows 3 persons in a one-bedroom rental, rising by two for each added bedroom to 13 persons in a six-bedroom rental.³ Applies to: Oak Park

State hotel tax applies to rentals under 30 nights

The Illinois Hotel Operators' Occupation Tax applies to sleeping room rentals of fewer than 30 consecutive days, including houses, apartments, condominiums and individual rooms rented by hosts.⁹

Bookings outside a remitting platform need an IDOR account

A host who also takes bookings directly, outside a platform that remits the tax, registers with the Illinois Department of Revenue and files Form RHM-1 for those bookings.¹¹ In force since July 1, 2026

Local hotel taxes are paid to the local authority

The Department of Revenue collects only the state tax and the Chicago-area hotel taxes; every other local hotel tax is paid directly to the city, village or county.¹⁰

• Chicago: $5,000 to $10,000 for each offense of exceeding the maximum occupancy limit; each day the violation continues is a separate offense.¹
• Chicago: $1,500 to $3,000 for each violation of the shared housing chapter, with each day a separate offense, and the registration can be suspended or revoked.¹
• Chicago: $1,500 to $5,000 for each offense of advertising or renting a unit in a Restricted Residential Zone.¹
• Oak Park: $200 for a first violation, $500 for a second and $750 for a third or later, each day counting as a separate violation.³
• State hotel tax: a host who does not pay the tax on Form RHM-1 is assessed the tax due plus penalty and interest.¹⁰

1. July 1, 2026
   Platforms register and remit the state hotel tax

   From July 1, 2026 a hosting platform that meets the $100,000 threshold registers with the Department of Revenue and remits the state and Chicago-area hotel taxes on rentals made through it; the 200-transaction threshold for re-renters was removed.¹¹

2. June 16, 2026
   Public Act 104-0468 signed

   Illinois enacted Public Act 104-0468, which makes hosting platforms and re-renters that reach $100,000 in Illinois receipts the hotel operator for the state hotel tax.^2,5

3. February 23, 2026
   Evanston passes an amended vacation rentals ordinance

   Evanston City Council voted 8-0 to pass Ordinance 2-O-26, which limits the number of short-term rental licenses, adds an appeal process and raises penalties; a moratorium on new license applications had run since 2025.^19,24

4. July 1, 2025
   Hosting platforms become subject to the state hotel tax

   From July 1, 2025 hosting platforms for short-term rentals that meet the definition of re-renter are subject to the Hotel Operators' Occupation Tax.¹²

Estimate what a home could earn

1. 1. Municipal Code of Chicago, Chapter 4-14 Shared Housing Units · American Legal Publishing for the City of Chicago
2. 2. Public Act 104-0468 (SB3019), Hotel Operators' Occupation Tax Act amendments · Illinois General Assembly
3. 3. Oak Park Village Code, Article 40 Short-Term Rentals · American Legal Publishing for the Village of Oak Park
4. 4. Galena Code of Ordinances, Chapter 112 Guest Accommodations · American Legal Publishing for the City of Galena
5. 5. Bill Status of SB3019, 104th General Assembly · Illinois General Assembly
6. 6. 16 CFR Part 464 - Rule on Unfair or Deceptive Fees · Electronic Code of Federal Regulations
7. 7. Shared Housing Registrations · City of Chicago Department of Business Affairs and Consumer Protection
8. 8. Shared Housing Registration: Common Eligibility Criteria · City of Chicago Department of Business Affairs and Consumer Protection
9. 9. Hotel Operators' Occupation Tax · Illinois Department of Revenue
10. 10. Publication 106, Hotel Operators' Occupation Tax (August 2026) · Illinois Department of Revenue
11. 11. FY 2026-33, Hotel Operators' Occupation Tax Changes, Effective July 1, 2026 · Illinois Department of Revenue
12. 12. FY 2025-28, Hotel Operators' Occupation Tax Updates for Hosting Platforms for Short-Term Rentals · Illinois Department of Revenue
13. 13. Excise Tax Rates and Fees · Illinois Department of Revenue
14. 14. Short-Term Rental License · City of Evanston
15. 15. Short-Term Rental Business Licenses · Village of Oak Park
16. 16. Vacation Rentals · City of Galena
17. 17. Tax Rates · City of Galena
18. 18. Register a Rental / Short-Term Rental Property · City of Rockford
19. 19. Ordinance 2-O-26 to amend Title 5, Chapter 9, of the City Code, Vacation Rentals · City of Evanston City Council
20. 20. The Rule on Unfair or Deceptive Fees: Frequently Asked Questions · Federal Trade Commission
21. 21. Active Shared Housing Registrations · City of Chicago Data Portal
22. 22. Occupancy tax collection and remittance by Airbnb in Illinois · Airbnb Help Center
23. 23. Responsible hosting in the United States · Airbnb Help Center
24. 24. City Council passes amended Vacation Rentals Ordinance · The Daily Northwestern