How to Form an LLC in Illinois
To form an LLC in Illinois, here's everything you need to know.
1. Choose a Name for Your LLC
Under Illinois law, an LLC name must contain as the last words, "limited liability company," "L.L.C.," or "LLC." The abbreviations "Ltd." and "Co." are not allowed in Illinois. The name must also not include the words "Corporation," "Corp.," "Incorporated," "Inc.," "Ltd.," "Co.," "Limited Partnership," or "L.P.”
Your LLC’s name must be recognizably different from the names of other business entities already on file with the Illinois Secretary of State. Names may be checked for availability by searching the Secretary of State Business Services name database. You may reserve a name for up to 90 days by filing Form LLC-1.15.
The filing fee is $300.
2. File Articles of Organization
An Illinois LLC is created by filing Articles of Organization, Form LLC-5.5 with the Illinois Secretary of State Department of Business Services. The articles must include: the LLC's name and address, the name and address of the LLC’s registered agent; the purpose(s) for which the LLC is organized; a statement regarding the LLC's duration (perpetual or for a specified period); whether the LLC will be manager-managed or member-managed; the names and addresses of the initial manager(s) if manager-managed; the names and addresses of initial member(s) if member-managed; and the name and address of the organizer(s).
The filing fee is $600 for online filing; $500 for paper filing. Online filings are handled on an expedited basis within 24 hours. The articles may be filed online or by mail.
All of the paperwork and procedural steps to start a limited liability company in Illinois can be done online using Nolo's Illinois Online LLC Formation application.
3. Appoint a Registered Agent
Every Illinois LLC must have an agent for service of process in the state. This is an individual or business entity that agrees to accept legal papers on the LLC’s behalf if it is sued. A registered agent may be an individual who resides in Illinois, or a domestic or foreign corporation authorized to do business in Illinois. If it's a corporation, its articles must authorize it to act as an agent. The registered agent must have a physical street address in Illinois.
4. Prepare an Operating Agreement
An LLC operating agreement is not required in Illinois, but is highly advisable. For help creating an LLC operating agreement, see Form Your Own Limited Liability Company, by Anthony Mancuso (Nolo) or use Nolo’s Online LLC. If an operating agreement is created, it need not be filed with the Articles of Organization.
5. Publication Requirements
6. Comply With Other Tax and Regulatory Requirements
Additional tax and regulatory requirements may apply to your LLC. These may include:
EIN: If your LLC has more than one member, it must obtain its own IRS Employer Identification Number (EIN), even if it has no employees. If you form a one-member LLC, you must obtain an EIN for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship (disregarded entity). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
Business Licenses: Depending on its type of business and where it is located, your LLC may need to obtain other local and state business licenses.
Department of Revenue Registration: In some cases, for example if you will be selling goods and collecting sales tax or if you have employees, you’ll need to register with the Illinois Department of Revenue (IDOR). You can register either online (through the MyTaxIllinois website) or on paper (Form REG-1). For more information on state LLC tax registration, see Nolo's article LLC Annual Report and Tax Filing Requirements: A 50-State Guide.
7. File Annual Reports
All LLCs doing business in Illinois must file an annual report with the Secretary of State. The report is due each year prior to the first day of the LLC's anniversary month (the month in which it was organized). For example, if your LLC was created on July 15 then your report would be due by July 1. The report can be filed online or by mail with Form LLC-50.1. The current filing fees are $250 for reports filed on paper and $300 for reports filed online. Filing a report late (more than 60 days after due date) incurs an additional $300 penalty.
8. Foreign LLCs Doing Business in Illinois
To do business in Illinois, all LLCs organized outside of the state must register with the Illinois Secretary of State. Foreign LLCs must appoint a registered agent for service of process physically located in Illinois. To register, file Application for Admission to Transact Business, Form LLC-45.5. The filing fee is $500. The form may be filed by mail.
The completed application must be accompanied by a Certificate of Good Standing or Existence from the foreign LLC’s home state, dated no more than 60 days prior to the filing of the certificate.
Before filing, make sure the LLC’s name is available in Illinois by checking the Illinois business name database. If the name is not available, the foreign LLC must adopt an assumed name for use in Illinois and submit it with the application. Use Form LLC-1.20, Application to Adopt, Change, Cancel or Renew an Assumed Name.