Forming an Illinois LLC
(2025 Guide)
2025 LLC Guide
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How to Start an LLC in Illinois (Step-by-Step Guide)
Discover how to start an LLC in Illinois, our step-by-step guide. Learn the essential requirements and process to form your business today.
To establish an LLC in Illinois, you need to submit the Articles of Organization to the Illinois Secretary of State. The filing fee is $150, and processing usually takes about 10 days.
There are six essential steps to complete:
- Choose an LLC Name
- Appoint a Registered Agent
- Submit the Articles of Organization
- Draft an Operating Agreement
- Obtain an EIN
- Register with the Department of Revenue
For those who prefer to handle the process on their own, our free guide below can assist you. Alternatively, if you’d like professional assistance, we suggest hiring Northwest Registered Agent.
Need to save time?
Form your LLC with Northwest ($39 + state fee) or LegalZoom ($149 + state fee).
(See why Northwest is #1: Northwest vs LegalZoom.)
What is the cost to establish an LLC in Illinois?
The initial cost to set up an LLC in Illinois is $150. Additionally, there is a $75 annual fee. What do these fees cover? The $150 fee is for submitting the Articles of Organization, which is the document that officially forms the LLC. The $75 annual fee is for the Annual Report, a required submission to maintain your LLC’s good standing. For more details on LLC expenses, refer to LLC Costs in Illinois.
How long does it take to establish an LLC in Illinois?
If you submit your LLC paperwork by mail, it will be processed in 7-14 business days, including mail time. However, if you file online, your LLC will also be processed in 7-14 business days, including mail time. For updates on processing times, please see How long does it take to get an LLC in Illinois.
Here are the steps to forming an LLC in Illinois
1. Search Your LLC Name
Start by checking the availability of your LLC name with the Illinois Secretary of State.
This step ensures that your desired name is not already in use, as two businesses in the state cannot have identical names. Conduct a search for your business name and compare it to those of existing businesses in Illinois. Utilize the Business Entity Search tool provided by the Department of Business Services through the Illinois Secretary of State to confirm that your chosen LLC name is unique and available.
Next, get acquainted with the state’s naming rules to ensure your LLC name meets all the necessary criteria for approval. We’ll provide a detailed explanation of both these processes in our Illinois LLC Name instructions.
Note:
Most people choose “LLC”.
2. Select a Illinois Registered Agent
The following step involves selecting a Registered Agent. A Illinois Registered Agent is an individual or company responsible for receiving legal mail and state notices on behalf of your Illinois Limited Liability Company.
Who is eligible to be an LLC Registered Agent? You have three options for appointing a Registered Agent:
You
A friend or family member
A Registered Agent Service
Illinois mandates that LLC Registered Agents must maintain a physical street address within the state. PO Boxes are not permissible. The name and address of the Registered Agent will be included in public records.
If you lack an address in Illinois or desire increased privacy, you can opt for a Registered Agent Service for your LLC.
We suggest Northwest Registered Agent
One of the aspects we appreciate most about Northwest is their willingness to allow you to use their office address for your LLC filing. This ensures your personal address is not listed in public records.
Additionally, they provide a service to scan any mail addressed to your LLC and upload it to your online account. Northwest offers exceptional customer service, and we trust them as our own Registered Agent.
Special offer:
Form your LLC with Northwest for $39 + state fee and get a free year of Registered Agent service.
(Read our Northwest Registered Agent review.)
3. Submit Articles of Organization
To establish an LLC, you must submit the Illinois Articles of Organization. This document is filed with the Illinois Secretary of State.
Filing the Illinois Articles of Organization online incurs a $150 fee. This is a one-time payment required to set up your LLC.
If you prefer to file this on your own, check out our detailed guide for submitting Illinois Articles of Organization. Alternatively, you can hire a company to handle the filing process for you.
Need to save time?
Form your LLC with Northwest ($39 + state fee) or LegalZoom ($149 + state fee).
(See why Northwest is #1: Northwest vs LegalZoom.)
4. Draft an LLC Operating Agreement
An LLC Operating Agreement acts as a complementary document to the Certificate of Formation. While the Certificate of Formation establishes your LLC, the Operating Agreement identifies the owners of the LLC.
Moreover, many banks require an Operating Agreement when setting up an LLC bank account. It is also invaluable if legal issues arise, as it demonstrates the proper management of your LLC. For these reasons, we advise all LLCs, including Single-Member LLCs, to have an Operating Agreement.
Additionally, an Operating Agreement is considered an “internal document.” This means you don’t need to file it with the state or the IRS (Internal Revenue Service). Simply keep a copy with your business records. You can download a free template below. Then, watch our Illinois Operating Agreement video for a step-by-step guide on how to complete it.
Download a free LLC Operating Agreement:
Member-managed: Google Doc | Word | PDF
Manager-managed: Google Doc | Word
(What’s better? See Member-managed vs Manager-managed LLC)
5. Obtain an EIN for Your LLC
The following step is to secure a Illinois EIN from the IRS for your LLC. Note: An EIN, also known as a Federal Tax ID Number or Federal Employer Identification Number, is essential.
An EIN is needed to:
– Identify your LLC for tax purposes
– Open a business bank account
– Apply for business licenses and permits
How much does an EIN cost? The IRS provides an EIN at no charge.
How long does it take to receive an EIN? Online applications are processed in 15 minutes, while mail or fax applications may take 1-3 months.
How can I obtain an EIN?
– US Citizens/Residents: With an SSN or ITIN, apply online. Follow these instructions: Apply for an EIN online.
– Non-US Residents: You can’t apply online, but you can obtain an EIN via fax or mail. See these instructions: How to get an EIN without an SSN or ITIN.
6. Sign Up with the Department of Revenue
Great news: Illinois does not require a state-wide general business license. However, every LLC must register with the Illinois Department of Revenue to operate in the state.
Upon registration, the department provides a Certificate of Registration and a Taxpayer ID. This certificate serves a similar purpose to a general business license, and the Illinois taxpayer ID is distinct from your LLC’s federal EIN number. Both the Certificate of Registration and the Taxpayer ID are free of charge ($0) and essential for conducting business in Illinois.
Additionally, depending on your LLC’s location, a local business license or permit might be necessary. For instance, starting a daycare might require obtaining a business license from your city or county. More information is available on our Illinois Business License page.
What should I do after my LLC is approved?
Once your LLC is approved, there are several important actions to consider.
Open a business bank account for your LLC.
Establishing a dedicated business bank account simplifies accounting and record-keeping for your financial operations. It also helps maintain your personal liability protection by keeping your business and personal finances separate.
File your Annual Report.
Every Illinois LLC is required to submit an Annual Report each year to remain in good standing with the state.
What is the cost of filing an Illinois Annual Report?
The fee for submitting an Annual Report is $75 annually.
When is the Annual Report due? Your Annual Report must be filed before the first day of the month in which your LLC was formed, known as your anniversary month. For instance, if your LLC was approved on May 16, 2025, your anniversary month is May, and your report is due before May 1 each year.
When is the first Annual Report due? The first Annual Report is due the following year after your LLC is approved. For example, if your LLC was approved on April 12, 2025, your first report is due before April 1, 2026.
How do I file my LLC Annual Report? Reports can be filed online or by mail, though online filing is recommended for ease. Follow our comprehensive guide here: Illinois LLC Annual Report.
Pay Taxes.
LLCs do not directly pay federal taxes; instead, the LLC Members report the income on their personal tax returns.
How is my LLC taxed? Default taxation by the IRS depends on the number of owners: a Single-Member LLC is taxed as a Sole Proprietorship, while a Multi-Member LLC is taxed as a Partnership. Alternatively, you may elect for C-Corporation or S-Corporation tax treatment.
Illinois LLCs must also pay 1.5% of their net income as the Personal Property Replacement Tax to the Illinois Department of Revenue. For more information on federal, state, and local income taxes, including sales tax, refer to Illinois LLC Taxes.
Helpful Resources
Illinois Secretary of State
Illinois Secretary of State: Department of Business Services
217-782-6961 (extension 7736 for the LLC department)
217-782-6875
217-524-8008
Illinois Department of Revenue
Illinois Department of Revenue
217-782-3336
217-524-4772
Monday – Friday, 8am – 4:30pm
Additional contact info
How to Start an LLC in Illinois FAQs
Can I start an LLC online in Illinois?
Absolutely, you can file for an LLC online in Illinois. The filing fee for the Articles of Organization is $150. Once submitted online, your LLC will be approved within 5-10 business days.
What are the benefits of an LLC?
One of the primary benefits of an LLC is the protection of personal assets. This means that if your business faces a lawsuit, your personal assets—such as your home, vehicles, and bank accounts—are safeguarded. This protection extends to all LLC members, whether it’s a Single-Member LLC or a Multi-Member LLC. All members are shielded from the business’s debts and liabilities. This protection isn’t available for Sole Proprietorships or Partnerships, making LLCs a more attractive business structure.
Another advantage is the LLC pass-through taxation. The LLC itself doesn’t pay federal income taxes; instead, profits are passed through to the members, who then pay taxes on their personal returns. Illinois state income taxes align with this, as the state respects the federal tax treatment of LLCs. For further details, see How are LLCs taxed.
Is Illinois a good state to start an LLC?
Whether Illinois is suitable for starting an LLC depends on your location and where you conduct business. If you reside in or operate your business in Illinois, it’s advisable to form your LLC there. Although some websites highlight tax benefits in other states, these aren’t relevant if they aren’t where you live and work.
For instance, if you establish an LLC in Delaware but live and do business in Illinois, you’ll need to register your Delaware LLC in Illinois and incur additional fees. Essentially, you’ll have a Domestic LLC in one state and a Foreign LLC in another, which involves separate procedures and costs. Ultimately, you’ll pay Illinois taxes regardless, leading to unnecessary expenses and complications.
In conclusion, if you live and do business in Illinois, it’s a suitable state to start a business. If not, it’s not the ideal choice. An exception is real estate: if buying property outside Illinois, form your LLC in the property’s state. For more insights, see Best State to Form an LLC.
About Us
We specialize in guiding individuals through the process of forming LLCs across all states, while also offering a range of comprehensive business services tailored to entrepreneurs.
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- +1 (646) 347-3833
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