Start Your LLC in Illinois with Tailor Brands for Free
Want to start an LLC in Illinois? We’ve partnered with Tailor Brands—a leading LLC formation service provider—to help you get started for free.Get your LLC registration services from the experts and save money while at it.
Free Formation. No Hidden Charges.
Tailor Brands simplifies the business formation process, allowing you to form an LLC starting at $0 plus state fees.
You’ll enjoy responsive customer support to assist you throughout the process, ensuring a smooth experience.
Tailor Brands combines business formation with branding solutions like logos and domains, making it a one-stop solution.
Things to Know Before Starting an LLC in Illinois
Being one of the top 10 states for business growth, Illinois is among the best places to start a limited liability company in the United States.
Here’s what you need to keep in mind before you form an LLC in Illinois.
- Make sure you know which type of LLC you want to start before filing your Articles of Organization. For instance, it costs more ($400 compared to the usual $150) to form a series LLC in Illinois than a normal domestic LLC.
- You’ll need to pay personal property replacement tax every year if you form an LLC in Illinois. The rate for regular LLCs is 1.5% of the total income. If you choose to have your LLC in Illinois taxed as a corporation, the rate will be 2.5%.
- It costs $75 to file annual reports for an LLC in Illinois. If you fail to file them within 60 days after the due date, you’ll attract a $100 penalty on top of the usual fees. If you still don’t file after, your business will be dissolved.
- It costs $30 to register a Doing Business As (assumed business name) with the Illinois Secretary of State. Your DBA name will be active for five years from the time of registration and it will cost you $150 to renew this application.
This next section explores the steps involved in creating an LLC in Illinois.
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How to Form an LLC in Illinois
An LLC in Illinois blends the best features and benefits of starting a C-corporation, Sole Proprietorship, and Partnership, into a simple, flexible structure suitable for small to medium-sized businesses, even low-risk businesses. You get limited liability for members along with pass-through taxation benefits.
Below is a step-by-step guide on how to form an LLC in Illinois.
Conduct an Illinois LLC Name Search
First, you want to make sure that the business name you have in mind is unique. You’ll need a name that’s easily distinguishable from any other LLC in Illinois. Also, ensure it follows Illinois naming guidelines.
Conduct your business name search with the entity search tool on the Illinois Secretary of State website to check for availability. To be on the safe side, have at least two potential names shortlisted before beginning this search.
Reserve Your LLC Business Name
If you’re not ready to file your Articles of Organization for your LLC in Illinois and register your name yet, you can reserve the name of your LLC in Illinois for up to 90 days. You’ll need to fill out a Form LLC-1.15 and apply with the state.
You need to pay $25 for a name reservation. You can also use the name of an LLC that was dissolved as long as it’s been three years since its dissolution. If you decide to register your articles of organization right away, you won’t need this step.
Select a Registered Agent for Your LLC in Illinois
All LLCs in Illinois are required to have a registered agent to take care of all their legal correspondence. Your registered agent can either be a business entity authorized to operate in Illinois, or an individual located in the state.
They must have a physical address in Illinois and be available to receive legal documents on your behalf. You’ll need to ensure that the name and address of your LLC’s registered agent are up to date in Illinois state records at all times.
Select Your LLC Type
Before forming your LLC in Illinois, you’ll need to decide on which form of LLC suits your business best. In Illinois, for instance, you’ll have the option to create a Series LLC, unlike most other states, change from LLC to S-corp, or have a freelance LLC. You can also create a foreign or a professional LLC.
Choosing an LLC type, which can be a single-member or multi-member LLC, helps determine the costs for filing. For instance, series LLCs cost $400 to register, while professional LLCs like real estate businesses cost an extra $50.
File Your Articles of Organization
To create an LLC in Illinois, you’ll need to file an Articles of Organization. You do this by filling out Form LLC-5.5 with the Illinois Secretary of State. This costs $150, and you can also request expedited filing for an extra $100 service fee.
By default, your LLC in Illinois becomes legal when the Department of Business Services files your Articles of Organization. However, you can designate a later date, within 60 days after filing your Articles of Organization, to be your LLC’s official “birthday”.
Create an Operating Agreement
Having an agreement for an operating LLC in Illinois isn’t legally required by the state. However, it’s crucial that your LLC has one for internal use. LLC operating agreements differ in length and content, and vary by business.
An LLC operating agreement is a document that outlines the responsibilities, liabilities, powers, and obligations of LLC owners. Some items you can include are member rights, responsibilities, dissolution rules, percentage of ownership, etc.
Get a Federal Employer Identification Number (EIN)
The next step is getting your EIN, also known as a federal Tax Identification Number. An EIN is similar to a social security number but for your business. This 9-digit number is how the IRS identifies your business and determines your tax obligations.
Unless they choose to file taxes as a corporation, a single-member LLC in Illinois doesn’t need to apply for an EIN as the IRS considers it a disregarded entity. This means that company income is treated as member income for federal tax purposes.
Open a Business Bank Account
Every LLC in Illinois needs to open a separate business bank account. This helps distinguish between personal income and business revenue and profits. It also makes it easy for small businesses to track spending and manage bookkeeping.
You’ll be able to track your business’s cash flows, investments, expenses, tax deductions, and more. Also, you’ll be building a relationship with your bank account, making your LLC in Illinois eligible for credits and/or loan funding in the long run.
Get Business Licenses and Permits
Filing an Articles of Organization permits your company to legally operate in the state of Illinois, but is not the only legal requirement that you need to meet. When forming an LLC in Illinois, you’ll need other federal and state business licenses and permits.
Your county and city governments may require them and may impose restrictions regarding advertising, parking, and many more. Some depend on the industry your business is in. You’ll need to familiarize yourself with these regulations as well.
Stay Compliant
It’s important to stay compliant with state and federal requirements after formation of LLC in Illinois. One way to do so is by filing your taxes on time to remain in the IRS’s good books. Another is by filing annual reports with the state to avoid penalties or dissolution.
The due date for filing annual reports is the day before the first day of your company’s anniversary month. The state mails a printed version of your annual report to the registered agent of your LLC in Illinois roughly six months before this due date.
Why Outsource LLC Formation Instead of Doing It Yourself?
The formation of an LLC in Illinois can get tedious, not only because of the paperwork involved but also because of all the moving parts. You’ll need a name, business licenses and permits, an EIN, and more, all of which are provided by different government bodies.
Let’s look at that in detail.
Saves Time
Since you’ll be outsourcing to experts, you’ll save the time you’d have spent scouring through the internet for information. All you’ll need to do is fill out an online form and provide any necessary documents for your LLC in Illinois and the rest will be taken care of.
No Errors
Business formation services have experience filing LLC forms on a daily basis. They know the legal requirements and regulations of each state. Letting them handle the formation of your LLC in Illinois will minimize your chances of mistakes or getting your application rejected.
Perpetual Support
Business formation service providers like Tailor Brands do more than just file your papers. They offer ongoing services beyond formation that you can leverage to grow your business. These include business compliance, accounting services, and more.
Benefits of Forming an LLC in Illinois
Why should you start an LLC in Illinois, or expand your foreign business into this state? Here are a few reasons why.
Flexible Tax Treatment
The state of Illinois has no restrictive provisions for how LLCs will be taxed. The businesses get to choose how they recognize their federal taxes. They can choose to be taxed as regular LLCs, single-member LLCs, or C-corporations.
If they choose to be taxed as regular LLCs, they’ll enjoy pass-through taxation benefits. Here, members pay federal income and self-employment taxes on their profit shares. Single-member LLCs are treated like sole proprietorships by the IRS.
Registration Costs
Illinois charges $150 to file Articles of Organization for an LLC in Illinois and an annual reporting fee of $75 every year. This is less than the cost of starting a C-corp in Illinois, which costs the same for filing, but you’d have to pay an extra $25 franchise fee.
The filing fees for forming a partnership for limited liability are much higher than for an LLC in Illinois. Each partner pays a $100 fee with a $5,000 cap. The filing fees for Series LLCs are favorable. At $400, you can have several LLCs operate under one LLC.
Limited Liability
LLC owners are not personally liable for their business’s debts and liabilities. This is similar to what corporations enjoy, but LLCs have it better since they require fewer formalities, compared to C-Corps, during and after formation, and are cheaper.
Limited liability partnerships also enjoy this protection but unlike LLCs, they’re more restricted on tax options. An LLC in Illinois can still have liability protection even with one member, unlike sole proprietorships, where owners are liable for business debts.
Flexible Membership
An LLC in Illinois has no restrictions on the number of members, meaning that you can have as many members as you can, or it can be just you. This lets you enjoy some of the benefits of sole proprietorships like having complete control over your business.
This is unlike any other limited liability business entity. For instance, S-corps can have a maximum of 100 shareholders. With C-corporations, you can have many members, but your business would be subject to double taxation and more regulations.
Fewer formalities
Corporations have multiple rules of operation. The management structure includes shareholders, a board of directors, and managers. They also need to hold annual shareholder meetings, organize board meetings, and record meeting minutes.
An LLC in Illinois has no such restrictions. They can be member-managed or the members can appoint managers to run the business on their behalf. LLCs have no provision for mandatory meetings and do not need to keep minutes either.
Lower Personal Property Replacement Tax
Illinois does not charge income tax from their LLC in Illinois and each chooses how to recognize their federal taxes. However, there’s a separate business tax on LLCs called personal property replacement tax. Illinois charges 1.5% on total income.
This rate is much lower than the rate of personal property replacement tax that corporations are required to pay, which is 2.5%. It’s important to note that a single-member LLC in Illinois is exempt from this taxation requirement.
Tailor Brands LLC Formation in Illinois: Free Services
Tailor Brands offers a range of services designed to help entrepreneurs launch and grow their businesses, and some of these services come at no cost.
Here are the services this online business formation service offers for free:
LLC Filing
Tailor Brands offers free formation services for your LLC in Illinois so you can start your business with minimal hassle. With the Lite plan, you can initiate this process for your LLC in Illinois at no cost. You only have to pay the state filing fees.
This plan covers the preparation and filing of all essential documents necessary for the formation of an LLC in Illinois. This makes it a great choice if you’re seeking to launch a business without the upfront costs of business legal services.
Business Coaching Program
Tailor Brands also offers a free business coaching program to support entrepreneurs in their journey. The program connects you with experts who provide personalized advice tailored to your business needs.
This program can help you build a strong business plan for your LLC in Illinois and grow your brand. With professional guidance, you’re better equipped to overcome challenges and accelerate business growth.
If you want to get started with your LLC in Illinois without spending too much, then Tailor Brands’ free package is your go-to resource. It can help you get started efficiently and affordably.
Tailor Brands LLC in Illinois Formation: Paid Services
With Tailor Brands, you can enjoy a variety of paid services designed to assist entrepreneurs in establishing and managing their LLC in Illinois. The two main premium plans, Essential and Elite, include several business growth features.
Here’s a breakdown of Tailor Brands’ premium plans and add-on services.
Essential
In addition to the features available on the Lite plan, Tailor Brands’ Essential plan offers business tools to help your LLC in Illinois get started.
- Accelerated processing: For those requiring quicker results, the Essential plan shortens the processing time for establishing your LLC in Illinois to just two business days, so you can launch quickly.
- Gift card: Included in this plan is a $30 Amazon gift card, which can be used for purchasing essential business supplies. This bonus is offered by Tailor Brands to help users kickstart their business.
- Operating agreement support: This plan assists in creating an operating agreement, which is crucial for defining the management structure and decision-making processes of your LLC in Illinois.
- Annual compliance notifications: Tailor Brands will issue alerts and reminders regarding mandatory report submissions and updates, ensuring your LLC in Illinois remains compliant with state laws.
Price: $199/year
Elite
Along with what the Essential plan provides, the Elite Plan includes a range of services designed to elevate your business’s digital presence, including:
- Custom logo development: Tailor Brands provides eight professional logo designs created by experts for your LLC in Illinois and other businesses within the Elite Plan. You can customize and tailor them accordingly.
- Social media post maker: This tool allows you to create engaging social media posts with ease. You’ll have customizable templates and design options to help you maintain a consistent online presence.
- Digital business card designer: The plan includes tools for creating digital business cards, which are increasingly popular in networking situations. These cards can be easily shared via smartphones or email.
- Website development tools: A free domain for one year is included, along with website design tools that allow you to establish your online presence. Tailor Brands offers DIY websites and store builders for customization.
- Gift card: Similar to the Essential Plan, the Elite Plan also includes a gift card, providing additional value upon subscription. This card can be used for various purchases to support business growth or personal needs.
Price: $249/year
Additional Services
Here are some additional services you can look forward to when partnering with Tailor Brands to establish your LLC in Illinois:
- EIN application: Tailor Brands ensures you meet IRS requirements and guides you through the EIN application process for an LLC in Illinois. An EIN is essential for opening a business bank account and filing taxes.
- Tax filing: Preparing and filing taxes can be overwhelming, but Tailor Brands simplifies the process for your LLC in Illinois. Their experts provide clear guidance on deadlines and deductions to help you avoid penalties.
- Business insurance service: Tailor Brands connects an LLC in Illinois with tailored business insurance solutions to minimize potential risks. You can compare policies and understand coverage options for your industry needs.
- Licenses and permits application: Having the correct licenses and permits is crucial for operation, especially for an LLC in Illinois. Tailor Brands provides expert guidance to help identify requirements specific to your business.
- Trademark service: With Tailor Brands’ trademark registration service, you can protect the name and reputation of your business across the US. An LLC in Illinois can prevent others from using similar names, logos, or slogans.
- BOI reporting: With the Corporate Transparency Act in effect, an LLC in Illinois must file its Beneficial Ownership Information (BOI) with FinCEN. Tailor Brands ensures you meet deadlines by handling this process for you.
Price: Contact sales
Why Tailor Brands is a Great Choice for Your LLC in Illinois Formation
Here are some reasons why Tailor Brands is a better choice to form an LLC in Illinois compared to other business formation service providers in the market.
All-Inclusive Business Tools
This business incorporation service goes beyond just formation. It provides a range of business-building tools, such as logo design, digital business cards, and social media post creators. These features are typically not offered by providers.
Everything you need is available in one convenient platform, so you don’t need to use multiple professional services. These tools simplify the process of creating a strong brand identity for your LLC in Illinois from the beginning.
Completely Free Plan
Tailor Brands offers a free plan for business formation, which is uncommon among other providers. You can file the necessary documents and establish your LLC in Illinois without any initial fees. If needed, you can always upgrade for more services.
Starting a business can be expensive, so this free plan helps minimize your startup costs. There are no hidden charges, and the LLC formation service remains free permanently. With this, setting up your LLC is also a straightforward process.
Continuous Compliance Assistance
After your LLC in Illinois is established, staying compliant with state regulations is essential to maintaining its good standing. Tailor Brands provides ongoing compliance support to ensure you don’t miss important deadlines.
Unlike other business formation service providers who often stop at formation, Tailor Brands helps you navigate the legal requirements of running an LLC in Illinois, giving you peace of mind and helping you avoid costly penalties.
Access to Marketing Resources
In addition to business formation services, Tailor Brands provides valuable marketing resources to enhance your business’s visibility and reach. These include social media tools and email marketing solutions.
Although they come at a cost, these marketing tools can help improve customer engagement and brand awareness right from the start. This will help you effectively promote and grow your LLC in Illinois.
Clear and Honest Pricing
With Tailor Brands, you get straightforward pricing for setting up an LLC in Illinois. You’ll know what each service costs before committing. Unlike competitors where hidden costs can add up quickly, Tailor Brands is transparent with pricing.
What’s included in the paid plans and additional services are also straightforward and easy to understand. You can confidently choose the plan that best suits your business needs without worrying about additional or hidden costs.
Simple and Intuitive Platform
Tailor Brands makes setting up an LLC in Illinois hassle-free with its user-friendly platform. You don’t need any special expertise to get started. The platform’s design makes it easy to find key features and complete your LLC formation with ease.
Additionally, helpful resources, such as FAQs, support articles, and responsive customer service, ensure you’re never left without assistance. If you’re creating an LLC in Illinois for the first time, you’ll appreciate this intuitive process and support.
FAQ
Forming a regular LLC in Illinois will cost you $150, which is the fee for filing your Articles of Organization with the Secretary of State.
However, if you’re forming a series LLC in Illinois, it will cost $400, and if you’re forming a professional Illinois limited liability company, it will cost you an extra $50 for a professional purpose clause.
After your Articles of Organization are submitted to the Illinois Secretary of State, it’ll take 3 to 4 weeks to be approved if the filling was done by mail. For online filings, your approval may take between 5 to 10 business days.
The state of Illinois has no specific income tax requirements for LLCs, so there are no Illinois business taxes. The way you file your taxes will depend on how you’ve chosen your business to be treated by the Internal Revenue Service.
For instance, you can choose to be treated as a disregarded entity if you register as a one-member limited liability company. Here, the IRS will treat your LLC in Illinois like it would a Sole Proprietorship.
Besides income tax, an LLC in Illinois pays personal property replacement tax which is 1.5% of its total annual income.
Here’s the process for starting an LLC in Illinois:
- Conduct an Illinois LLC name search: Make sure the business name you’ve chosen isn’t in use by any other LLC or corporation in the state.
- Reserve your LLC business name: Reserve your LLC name with the state of Illinois for up to 90 days if you’re not ready to use it just yet.
- Select an Illinois registered agent: Select an Illinois registered agent to take care of all your legal correspondence from the IRS and the state.
- Select your LLC type: You’ll get the option to create a domestic LLC in Illinois, a series LLC, a professional limited liability company, etc.
- File your Illinois LLC Articles of Organization: To create an LLC in Illinois, you’ll need to file the Articles of Organization by filling out Form LLC-5.5.
- Create an Operating Agreement: This document is crucial for LLCs as it outlines internal rules to help members run the business smoothly.
- Get a Federal Employer Identification Number (EIN): This is a 9-digit number that helps the IRS identify your business and determine your tax obligations.
- Open a Business Bank Account: A separate business bank account helps distinguish between personal and business finances.
- Get Business Licenses and Permits: You’ll need other business licenses and permits from your county and city governments to operate your LLC in Illinois.
- Stay Compliant: Keep your LLC in Illinois compliant with state and federal requirements by reporting taxes and filing annual reports on time.
You can be your own registered agent in Illinois, as long as you have a physical address there. However, given the legal requirements for registered agents, it’s advisable to have another individual or business be your registered agent.
Get Your Illinois LLC Up and Running With Tailor Brands
Worried about all the state regulations and requirements for forming an LLC in Illinois? Looking for an easier option?
Leave all the paperwork to the experts and focus on building your business.
$0 + State Filing Fees