How To Start An Illinois Llc: The Basics

in Small-business
There are many advantages to setting up a limited liability company in Illinois lots of flexibility, easier business operation and no double taxation are just some of these. But in order for you to enjoy these benefits, you need to set up an Illinois LLC first.

The following is a basic outline on starting an Illinois LLC:

Choose a business name for the LLC and check if it is available. Illinois law requires Illinois LLCs to have a business name that contains the words limited liability company, LLC or L.L.C. The business name should also be distinguishable from other business names on file with the Secretary of State and must not contain the terms "Corporation," "Corp.," "Incorporated," "Inc.," "Ltd.," "Co.," "Limited Partnership" or "L.P.". In addition, it is also recommended that you register your business name as a federal or state trademark. Although the Illinois LLC registration regulations consider this an option, registering the business name of your LLC as a federal/state trademark can help protect it name against trademark infringement in the US.

Furnish and file Articles of Organization with the Secretary of State. New Illinois LLCs are required to prepare articles of organization and file them with the Secretary of State. The filing fee is $500, and you can get the form for the articles of organization for Illinois LLCs from the Illinois Secretary of State website.

Negotiate and execute the operating agreement. Currently the state of Illinois does not require new Illinois LLCs to furnish an operating agreement, though it is still highly recommended that you do so. The content of the operating agreement varies from one Illinois LLC to another, though it usually includes topics such as the conduct of the meetings, operations and management, the required capital contributions from each member, and the type of allocation for the profits and losses.

Get the required local licenses. Similar to an Illinois S corporation, an Illinois LLC must obtain a basic local business license (also known as a tax registration certificate) in order to operate. You may have to obtain other licenses depending on the city or county your company is based in, so make sure to visit your county/city clerk office to find out more.

Find out the other regulatory obligations your LLC has. Another similarity Illinois LLCs have with an S corporation is the various regulatory obligations and registrations that must be complied with. Some of these obligations include:

Employer Identification Number:
can be requested online from the IRS website

Illinois LLC Registration with the Illinois Department of

Employment Security:
required if your Illinois LLC hires employees living in Illinois

Business Tax Registration:
new LLCs must register for this tax with the Illinois Department of Revenue.

Employment Regulations:

whenever you hire employees who reside in the state of Illinois, you need to inform both the IRS and the state government. The LLC must also carry workers compensation insurance. You can also get workers compensation insurance for yourself, but it is not required. However, if you do decide to opt out from the workers compensation policy of your LLC, be sure to inform the insurance company that handles the policy.

There are other informational returns that you have to file annually or semi-annually with the IRS, so make sure to visit your nearest IRS office to find out more.

Open a bank account. We strongly recommend that you keep the finances of your Illinois LLC separate from your personal accounts. One way you can do this is by opening a separate bank account for your business. You will likely have to get a Tax ID number (EIN), a copy of your articles of organization, and a resolution that identifies the authorized signers that are not listed on the articles.

Other requirements which may have to comply in order to start an Illinois LLC include filing an annual report with the Illinois Secretary of State at the end of every fiscal year (this usually costs around $250) as well as documents listed in the 805 Ill. Comp. Stat. 180/1-40 to be kept at the principal place of business of the LLC at all times. So make sure to visit your local county or city clerk for more details on how to file Illinois LLC paperwork.
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Mark Geldman has 1 articles online

Mark has been blogging about commerce and entrepreneurship in the state in Illinois since the early 2000s, writing numerous e-books and post about these subjects. Currently he is among the regular contributors of Illinois LLC.

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How To Start An Illinois Llc: The Basics

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This article was published on 2011/03/30