Illinois Cigarette / Tobacco Tax Bond

File Form REG-4-A with the Illinois Department of Revenue. You can provide financial responsibility through a surety bond, bank certificate of deposit, or letter of credit. Each business location requires a separate bond filing. The bond must be issued by a surety company authorized to do business in Illinois and remain in effect as long as you hold your distributor license. Contact IDOR to calculate your exact bond amount if you're a tobacco products distributor, as it's based on your average monthly tax liability.

This bond is required for cigarette distributors and tobacco products distributors operating in Illinois who are licensed by the Illinois Department of Revenue. Each business location requires a separate bond. The bond ensures compliance with the Cigarette Tax Act (35 ILCS 130/) and tobacco excise tax laws. Retailers typically do not need this bond—it applies to distributors, machine operators, and similar licensees who handle wholesale distribution and tax collection.

The bond amount depends on your business type. Cigarette distributors must file a $2,500 surety bond per business location. Tobacco products distributors (non-cigarette) must file a bond equal to 3 times their average monthly tobacco tax liability or $50,000, whichever is less. New tobacco distributors or those with prior-year liability under $50,000 may be exempt. Distributors with tax delinquencies or those using payment drafts may need additional supplemental bonds ranging from 80-150% of their average monthly tax liability.