There are several benefits that you can enjoy when you form an Illinois LLC for your business. You’re required to file the Articles of Organization (costs $150) with the Illinois Secretary of State online, in-person, or by mail. This paperwork acts as the legal document that denotes that you have officially created an LLC for your Illinois business.
Here are five steps to follow when forming an LLC in Illinois.
- Select an Illinois LLC Name
Start by searching your company name of choice on the Secretary of State’s Cyberdrive Illinois website, and ensure that it’s readily available since no two companies can have the same name. Also, check that its web domain is not yet taken to develop a URL that matches your business name to be easily searchable on the internet by clients.
Is that all done? Then, follow the naming rules below for an Illinois LLC.
- A company name includes; Limited Liability Company, L.L.C., LLC, Company, Co, Limited, or Ltd.
- A name that doesn’t mention any government agency like the FBI, Treasury, etc.
- Some words such as Attorney, Bank, and University may require additional approvals from the state to be a part of your LLC name.
- Choose an Illinois Registered Agent
Using a registered agent can save you both time and money than when registering your business on your own. They have proven experience in handling business formation and many other legal issues.
What is a Registered Agent? – A registered agent is a company or an individual that acts on behalf of a business entity to send and receive official and legal documents. And the registered agent must be a resident or have a physical address in Illinois, with the authority to conduct business in the state.
Get yourself a registered agent; you can trust when moving through the confusing Illinois laws.
- File the Articles of Organization for Your Illinois LLC
Apply online, in-person, by mail the Articles of Organization with the Illinois Secretary of State to legally form an LLC in Illinois. This document is referred to as the Certificate of Organization or the Certificate of Formation in some states.
The Illinois Articles of Organization filing fee is $150 non-refundable and payable to the Secretary of State Department of Business Services.
Your Articles of Organization contains:
- Name of your LLC.
- A registered agent – name, address, and signature.
- List of services to offer
- How your LLC will be managed (either manager-managed or member-managed).
- Pay the state filing fee.
Once this paperwork passes this step and gets approved by the state, it automatically becomes a public record.
- Create an Operating Agreement for Your Illinois LLC
Every business in Illinois is encouraged to develop an internal document referred to as an Operating Agreement that clearly states the role and responsibilities for all members in an LLC organization.
An Operating Agreement contains:
- The owner of the company.
- The investors and other members.
- How it will be managed.
- Day-to-day operations and who is responsible for managing them.
- How future problems or conflicts should be resolved.
- How profits are shared, etc.
- Apply for an EIN
Your company needs an EIN (Employer Identification Number) to successfully execute all its core services in Illinois. An EIN is also known as FTIN (Federal Tax Identification Number) or FEIN (Federal Employer Identification Number).
What is an EIN? – It’s a 9-digit number issued by the IRS (Internal Revenue System) that identifies a business entity and keeps track of its tax reporting. In other words, it can also be referred to as an SSN (social security number) for the company.
An EIN allows your Illinois business to:
- Open a business bank account.
- File both federal and state taxes for your business.
- Hire employees for the company.
Scroll through the IRS website, and submit the necessary form to request an EIN for your Illinois LLC (free of charge).
Benefits of Starting an Illinois LLC
You can never go wrong when you form an LLC in Illinois for your business. And this is mainly contributed by the benefits you can reap with an Illinois LLC.
Here are some benefits:
- Business credibility.
- Personal asset protection.
- Pass-through taxation.
- Ease of maintenance.
- Flexible management structure.
- Easy access to business loans.
FAQ About Starting an Illinois LLC
What is an LLC? – It stands for Limited Liability Company and has a simple business structure as compared to a traditional corporation.
Can I Be my Own Registered Agent? – Anyone in Illinois and of age can become a registered agent as long as they have a physical address.
How Long is the Processing Time of Starting an LLC in Illinois? – Filing the required paperwork to the relevant state agency usually takes 10 days by mail or online. If you’re willing, you can pay an additional fee for the expedition.
Will I Be Filing an Operating Agreement with The Illinois State? – The state recommends it, but it’s just an internal document that’s not filed to them.
Do I Need an SSN to Get an EIN? – Applying an EIN is independent, and it doesn’t matter whether you have an SSN or not. You only need to submit Form SS-4 with the IRS.
Illinois is the home of the ever-growing Chicago City, and other major promising cities such as Naperville, Rockford, Aurora, Joliet, and Oak Brook. These are some of the cities that you can start and expand your business through the formation of an LLC by following our simple five steps above. It’s time for you to feel secure in your future endeavors.