Illinois’s Department of Revenue released two tax letters (GIL 24-0036 and GIL 24-0044) confirming downloaded computer software–including video games, game add-ons, and virtual currency–count as tangible personal property and are subject to Illinois sales tax.

The bottom line: Illinois considers downloaded computer software, including video games, in-game items, and virtual currency, to be taxable tangible personal property. For example, even if a basic game or purchase is free, taxes apply to any virtual items or upgrades bought within a game.