Launch an S-Corp in Illinois Easily with Inc Authority

Your business name is the first step toward building a strong brand for your S-corp in Illinois. Make sure it’s unique, memorable, and meets Illinois Secretary of State naming rules, and check its availability as a domain name for your website.

You can reserve your chosen name for 60 days, protecting the brand of your S-corp in Illinois while you prepare and complete formation paperwork. The standard name reservation fee is $25, while expedited reservation costs $75 for quick processing.

To obtain S-corporation status, you must first form either a corporation or a limited liability company (LLC) in Illinois. Each structure offers limited liability protection, but there are differences in management style, ownership flexibility, and tax implications.

Corporations in Illinois may be better suited for raising capital and issuing stock, while LLCs offer management flexibility and fewer formalities. The right business structure ensures smoother operations and helps maximize potential tax benefits.

Every S-corp in Illinois must appoint a registered agent to receive legal documents and government correspondence. The agent serves as your official point of contact, must have a physical street address, and be available during regular business hours.

You can serve as your own agent or hire professional services. Many business owners prefer third-party agents. Inc Authority is a reliable formation service, offering a free registered agent service for the first year when you form your entity with them.

To form an S-corp in Illinois, you must file articles of organization (for LLCs) or articles of incorporation (for corporations) with the Illinois Secretary of State. The standard filing fee is $150, with processing typically taking 10 business days.

Expedited service is available for $250, with a 24-hour turnaround time. If forming a Series LLC, fees rise to $400 standard or $500 expedited. These filings establish your legal business entity, which is required before you can elect an S-corp status.

If your S-corp in Illinois will operate under a different name from its legal entity name, you must register an assumed name. The filing fee is based on the calendar year’s last digit — ranging from $30 to $150. Expedited processing adds $50.

Corporations pay a one-time fee, while LLCs must renew DBAs every five years. You can also cancel or change the name for $5 or $25, respectively. Registering a trade name helps protect your brand and ensures compliance with Illinois regulations.

Every S-corp in Illinois should create internal governance documents to define how the business operates. LLCs use operating agreements, while corporations must draft corporate bylaws at their first organizational meeting, as required by Illinois law.

These documents outline roles, responsibilities, voting procedures, and dispute resolution. Though not filed with the state, they’re legally binding and essential for maintaining structure and transparency. They also protect your limited liability status.

Obtaining an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) is mandatory for your S-corp in Illinois. This nine-digit tax ID number is required to file federal income tax returns, open a business bank account, and hire.

You can apply for an EIN for free online through the IRS website, and approval is typically instant. There’s no fee to apply. Be sure to complete this step before filing Form 2553, as your federal tax identifier is required to elect S-corp tax status.

To officially become an S-corp in Illinois, you must file IRS Form 2553 within 75 days of forming your entity. This form notifies the IRS that you want your LLC or C-Corp taxed as an S-corp, unlocking potential tax benefits and pass-through treatment.

Inc Authority files Form 2553 for just $79, ensuring accuracy and timely submission. All shareholders must consent to the election, and the entity must meet IRS eligibility criteria, including having no more than 100 shareholders and only one class of stock.

Illinois doesn’t require S-corps and partnerships to pay the corporate income tax (9.5%). However, your S-corp in Illinois is subject to the state’s Personal Property Replacement Tax of 1.5% on net income, which replaces the personal property tax.

You’ll need to register with the Illinois Department of Revenue via the MyTax Illinois portal. Shareholders report business income on their personal tax returns and pay Illinois income tax at the individual rate of 4.95%, meeting pass-through treatment.

Your S-corp in Illinois needs to maintain a dedicated business bank account to preserve its limited liability status. This account helps distinguish personal and business income, which is vital for legal protection and accurate tax reporting.

This account simplifies bookkeeping and tracking business income and expenses, making it easier to prepare tax returns and meet compliance requirements. To open it, you’ll need your EIN, formation documents, and internal governance paperwork.

Proper accounting using accounting software or professionals is key to managing the books for your S-corp in Illinois, and staying tax compliant. You’ll need to accurately track shareholder distributions, salaries, and expenses to inform proper decisions.

You can register for Illinois payroll taxes through MyTax Illinois. This includes state income tax withholding and unemployment insurance. The IRS scrutinizes S-corp payroll practices, so file on time to avoid penalties under the Illinois Income Tax Act.

Ensure you determine the licenses or permits at the local, state, or federal level that your S-corp in Illinois needs. These vary depending on industry and location, with common examples including retail sales tax permits and professional licenses.

Check with the Illinois Department of Financial and Professional Regulation, your local city hall, and county offices for specific permits. Failing to obtain the necessary licenses can result in fines, delays, or even suspension of your business activities.

Illinois requires workers’ compensation insurance for businesses with one or more employees. If your S-corp in Illinois owns vehicles, commercial auto insurance is mandatory. These policies help protect your business from liability and financial loss.

Other recommended coverages include general liability, professional liability, and a business owner’s policy (BOP). Insurance helps safeguard your S-corp in Illinois from lawsuits, property damage, and unexpected business disruptions.

To keep your S-corp in Illinois in good standing, file an Annual Report with the Secretary of State. The standard fee is $75, or $125 if expedited ($75 plus a $50 rush fee). You’ll also owe a 1.5% Personal Property Replacement Tax on net income.

You can request a Certificate of Good Standing for $25, or $45 if expedited. Keeping accurate records, holding annual meetings, and filing on time ensure your S-corp remains compliant and eligible for tax benefits under the Illinois Income Tax Act.

The Starter plan builds on the free package by adding tools for governance, compliance, and professional presentation. This plan is ideal for business owners who want their S-corp in Illinois to operate smoothly and stay in good standing.

• Automated Compliance Tracking: Receive timely deadline notifications and filing reminders. These compliance tracking helps keep your Illinois S-corp in good standing with state and federal authorities throughout the year.

• Custom Governance Documents: Expertly drafted operating agreements for LLCs or corporate bylaws for corporations. Each is tailored to your business structure and operational needs for enhanced legal protection.

• Digital Business Presence: Complete web domain registration plus five professional business email addresses to establish a credible online presence and professional communication channels for your S-corp in Illinois.

• Essential Business Forms Library: Extensive collection of corporate forms and templates for ongoing operations. This includes meeting notices and resolution forms necessary for professional business management.

• Comprehensive Meeting Documentation: Complete packages of initial meeting minutes and corporate resolutions establishing your business and providing proper documentation for corporate formalities and decision-making.

• Official Ownership Documentation: Formal stock certificates or membership interest certificates providing official documentation of ownership for business transactions for the shareholders of your S-corp in Illinois.

• Professional Record Management: Deluxe organizational system designed for maintaining corporate records, important documents, and meeting minutes to satisfy legal compliance requirements and business best practices.

The Starter plan offers comprehensive business establishment with ongoing administrative support and legal compliance for serious entrepreneurs.

The Fast Track plan includes all features from both previous tiers, plus personalized services and expedited processing. It’s ideal for entrepreneurs requiring accelerated timelines and individualized attention when forming their S-corp in Illinois.

• Individualized Business Consulting: One-on-one advisory sessions addressing unique challenges and growth strategies for your S-corp in Illinois.

• Dedicated Customer Success Advisor: You’ll have one-on-one guidance from a personal success advisor walking you through every step of setting up your S-corp in Delaware.

• Specialized Banking Connections: Expert help building relationships, securing banking solutions, and navigating account setup for S-corporations.

• Priority Processing Services: Expedited document preparation with Illinois authorities to accelerate the formation timeline for your S-corp in Illinois.

This package is ideal for founders seeking premium service levels and rapid formation processes. It’s the most complete solution for establishing an S-corp in Illinois with personalized attention, accelerated timelines, and pro guidance.