How Much Does It Cost To Set Up An LLC In Illinois?

Here is a complete breakdown of what it costs to form an Illinois LLC. You need to file Articles of Organization (Form LLC-5.5). It has a $150 fee. You may need to pay an additional fee for expedited 24-hour processing. Other costs include the annual report fee, which is paid on a yearly basis. If you are using a professional business filing service, filing charges may also apply.

How Is An LLC Taxed In Illinois?

A single-member Illinois LLC treated as a disregarded entity pays no state-level business income tax. Profits pass directly to the owner's personal return and are taxed at Illinois's flat individual income tax rate of 4.95%. Multi-member LLCs taxed as partnerships are subject to two separate Illinois taxes. The first is the 4.95% individual income tax, paid by each member on their share of LLC profits. The second is the Personal Property Replacement Tax (PPRT), which applies at 1.5% of net income at the partnership level. This replacement tax does not apply to single-member LLCs. It is one of the few genuinely unique Illinois tax obligations that surprises new multi-member LLC owners who assumed the pass-through rules were identical to those in other states. If your LLC sells taxable goods or services in Illinois, you must register for the state's sales tax. The base Illinois rate is 6.25%, with a combined state and average local rate of 8.92%.

What Is The Annual Report Deadline For An Illinois LLC?

Illinois annual reports are due before the first day of your LLC's anniversary month each year. If your LLC was formed in July, your annual report is due before July 1 i.e., June 30 every year. The state gives a 60-day grace window after that date. Filing during the grace period triggers a $100 late fee. After 120 days without a filing, the Secretary of State administratively dissolves your LLC.

What Is The Difference Between An Assumed Business Name And A DBA In Illinois?

In Illinois, an assumed business name is the formal process for registering a name your LLC uses in day-to-day business that differs from its legally registered name. It is filed with the Illinois Secretary of State using Form LLC-1.20 after your LLC is formed. This is different from how most states handle DBAs, which are typically county-level filings. In Illinois, assumed business names must be renewed, and doing business under an unregistered assumed name can expose your LLC to compliance issues.

How Do You Dissolve An LLC In Illinois?

Start by following the dissolution steps in your operating agreement. Settle all outstanding business debts, close open tax accounts with the Illinois Department of Revenue, and distribute remaining assets to members. Once those obligations are met, file the Statement of Termination (Form LLC-35.15) with the Illinois Secretary of State. You can file online, by mail, or in person. Cancel your state tax registrations and notify any creditors of the dissolution at the same time to prevent future obligations from accruing.

Excellent

7,486 reviews

How To File An LLC In Illinois?

To form an LLC in Illinois, you start by filing Articles of Organization (Form LLC-5.5) with the Secretary of State and paying the $150 filing fee. You also need to appoint a Registered Agent, obtain a federal EIN, and necessary licenses and permits.

If you want to set up an LLC in IL, we are here to help. We offer fast and affordable business formation services that cover everything from your initial name check to your IRS Tax ID (EIN) and final state filing.

Start your LLC at $0 + state fees

Illinois LLC Requirements

Before going into the details, here is your quick checklist for starting an LLC in IL.

Name: Must be unique and include "LLC," "L.L.C.," or "Limited Liability Company."
Office: Needs a physical Illinois street address for your registered agent (no P.O. boxes).
Paperwork: File the Articles of Organization with the Illinois Secretary of State.
Cost: $150 one-time state filing fee.
Maintenance: File an annual report before the first day of your LLC's anniversary month every year.

What Is LLC Formation?

A limited liability company (LLC) is a business entity that combines the personal liability protection of a corporation with the flexibility of a sole proprietorship or partnership. It’s a great business structure for small businesses because it’s easy to set up, requires lower taxes and fees than an S corp or C corp, and protects your personal assets.

In Illinois, LLC formation is handled through the Illinois Secretary of State Business Services Division. Once your Articles of Organization are accepted and your state fees are processed, the Secretary of State assigns your LLC an official file number, and your business becomes a legally recognized entity in the state.

Why Start An LLC In Illinois?

Illinois is a global economic leader with a $1.2 trillion Gross Domestic Product (GDP), ranking it as one of the top five largest state economies in the U.S. [1] It has 1.4 million small businesses, making up 99.6% of all businesses in the state. These businesses employ around 2.4 million people. [2]

Illinois sits at the center of the U.S. freight network. O'Hare International Airport handles more air freight than any other airport in the Midwest, and Chicago is the only city in North America where six Class I railroads converge. [3] For product-based businesses, that infrastructure is a structural advantage that most other states cannot simply offer.

For the tax picture, Illinois uses a flat individual income tax rate of 4.95%. This is the rate most LLC members pay since the pass-through structure is the default. [4] Illinois also offers an optional Pass-Through Entity Tax (PTET) election at 4.95% for qualifying partnerships and S corporations, which generates a corresponding federal deduction and credit for members. [5]

Key Benefits Of Forming An LLC In Illinois

Personal Asset Shield

An LLC's "limited liability" separates your personal and business assets. With an LLC, your house and all your personal property are protected in the event of any lawsuits. Instead, your business assets will take the hit unless you maintain your LLC legally.

Maximum Management Freedom

An LLC has no limit on the number of members, unlike an S Corp. It has management flexibility and can be "member-managed" or "manager-managed". While most small business LLCs will elect an owner within the organization, you can also choose to appoint a person or corporation outside your business as the owner.

Flexible Pass-Through Taxation

By default, an Illinois LLC does not pay state or federal corporate income taxes. Profits and losses pass directly to members' personal tax returns, where they are taxed at Illinois's flat 4.95% individual rate. This keeps most LLC owners well clear of the state's combined 9.5% corporate tax rate. [6]

Instant Professional Credibility

Adding "LLC" to your name in Illinois opens doors that a sole proprietorship cannot. Illinois banks require LLC status to open a dedicated business account. Many commercial landlords in Chicago, Naperville, and across the Metro East region treat registered entity status as a baseline requirement before signing a lease or entering a vendor agreement.

How To Register An LLC In Illinois: A Step-By-Step Guide

Illinois has a few filing details that differ from those of other states, including a 90-day name reservation window, a specific process for assumed business names, and an anniversary-month annual report deadline. Each step below covers exactly what you need to file correctly the first time.

Choose A Business Name For Your Illinois LLC

Your business name is your brand. It’s how your customers will identify you, so selecting a strong, unique name for your LLC is crucial to convey your brand in its best light. You’ll also need to ensure your business name accords with the guidelines for LLCs in Illinois:

Illinois LLC Naming Requirements

Be Unique:	Use A Legal Designator:	Stay Honest:
No other business registered in Illinois can use the same name or one that is difficult to distinguish from yours.	Must contain the words "limited liability company" or abbreviations like "L.L.C." or "LLC."	You cannot use a name that misleads the public about your business type, implies government affiliation, or suggests services your LLC does not actually provide.

If your name is available but you are not ready to file, you can reserve it by filing Form LLC-1.15, Application to Reserve a Name. Illinois's name reservation window is 90 days, shorter than most states. Expedited processing on this form costs an additional fee.

Assumed Business Name

Illinois has a specific registration process for LLCs that operate under a name different from their legal registered name. This is called an assumed business name. An LLC used Form LLC-1.20 to register the assumed name.

The filing fee depends on the calendar year in which you file, based on the last digit of the year:

$150 if the year ends in 0 or 5
$120 if the year ends in 1 or 6
$90 if the year ends in 2 or 7
$60 if the year ends in 3 or 8
$30 if the year ends in 4 or 9

This fee covers a period up to the next year evenly divisible by 5, after which the assumed name can be renewed via the LLC’s annual report.

Registering A Domain

Because having an internet presence is essential to running a business these days, it’s also a good idea to make sure a domain name is available for your business. You want your customers and clients to be able to find you online easily.

Check Availability Early:
Run your domain search at the same time you check name availability in the Secretary of State's database.
Business Website Tip:
If your preferred .com is taken, adding "IL" or your city name to the URL keeps your branding consistent without changing your legal entity name.

™️ Trademarking Your Name

Filing your Articles of Organization does not protect your brand outside of Illinois.

State Trademark:
Get a state trademark to avoid anyone from using your business name in the state.
Federal Trademark:
A federal trademark through the USPTO gives you legal protection across all 50 states.

Fill Out Your Illinois Articles Of Organization

The Articles of Organization are the document that officially creates your LLC in Illinois. You file it with the Illinois Secretary of State Business Services Division using Form LLC-5.5. You can file online, by mail, or in person.

What Information Do You Need To Complete Your Illinois LLC?

LLC name with a legal designator
Street address of your principal place of business
Effective date of the Articles (cannot exceed 60 days from filing date)
Registered agent name and address
Business purpose
Duration of the LLC (perpetual or fixed term)
Names and addresses of initial managers or members
Names, addresses, and signatures of organizers

Illinois requires the names and addresses of initial managers or members on the public Articles of Organization. Many Illinois LLC owners choose a professional registered agent service to reduce how much personal information that appears in the public record.

Fees And Processing Time

State Filing Fee:
$150 (one-time).
Processing Time:
Standard processing takes 5 to 7 days (expedited options available).
Correction Policy:
If your application has errors, the Secretary of State returns the filing with notes. You can correct and resubmit.

Foreign LLCs And Registration

If your LLC was formed in another state (such as Delaware or Indiana) but you plan to hire employees, sign a commercial lease, or sell products within Illinois, you must register as a "Foreign LLC" with the Secretary of State.

Application for Admission:
You must file Form LLC-45.5 and pay the fee. You are also required to include a Certificate of Good Standing from your home state dated within the last 60 days.
Domestication:
Illinois allows "Domestication" under the Limited Liability Company Act. You need to file a Statement of Domestication to permanently move your LLC's legal home to Illinois.

Annual Report Requirements

The Deadline:
Before the first day of your LLC's anniversary month, every year.
The Penalty:
There is a 60-day grace window with a late fee. After 120 days without a filing, the Illinois Secretary of State will administratively dissolve your LLC.

Hire An Illinois Registered Agent

Every Illinois LLC must designate a registered agent in its Articles of Organization. The registered agent is the official point of contact between your business and the state for legal notices, government correspondence, and service of process.

To serve as a registered agent in Illinois:

The individual or entity must maintain a physical street address within the state (no P.O. boxes); they must be available during regular business hours to receive legal documents. Most business owners hire a registered agent service in each state where they’ve registered.

Why Do You Need A Professional Registered Agent?

Privacy Protection

The registered agent gets published in the public domain. So, it’s not a good idea to use your home address. You want to keep your residence private and free from solicitors or worse.A registered agent service helps avoid this uncomfortable position.

Guaranteed Business Hours

A registered agent must be physically available during these business hours in the event of being served. A professional agent will be available during business hours, so you can worry about one less thing.

Expert Mail Processing

You’re probably already getting tons of mail related to your business. A professional agent separates critical legal and state notices from routine mail and delivers what matters through a secure digital dashboard.

Multi-State Requirements

If you expand into other states, you need a registered agent with a physical address in each one. Our service covers all 50 states, so compliance does not become a logistical problem as you grow.

Why Should You Use Our Registered Agent Service?

Your home address stays off the Illinois Secretary of State's public record.
24/7 dashboard access to all legal correspondence.
Automated reminders for your annual report anniversary deadline.

Whether you're looking to change your Registered Agent or need a new one, we'll handle it with privacy, protection, and 24/7 compliance monitoring. Get started with our professional service for an affordable fee today!

Create An LLC Operating Agreement

The next step in your process is to create an LLC operating agreement. This internal document settles all operating procedures for your Illinois business. While Illinois does not require you to register your agreement with the Secretary of State, without one, the state determines how you will run your LLC.

Your LLC needs an Operating Agreement because it:

States how a business handles profits, losses, and voting.

Creates legitimacy for business in the eyes of institutions like banks and investors.

Make sure that members are on the same page regarding the minutiae of LLC operation.

Provides a clear roadmap for LLC formation changes and dissolution.

LLC Operating Agreements: Key Sections You Need To Include

General Business Information	This section states your LLC's official name as registered with the Illinois Secretary of State, your principal business address, and whether the LLC has a perpetual or fixed duration.
Management Structure	Defines whether the LLC is member-managed or manager-managed, consistent with what you declared on the public Articles of Organization.
Tax Designation	Formally states whether the IRS will treat your LLC as a sole proprietorship, partnership, S Corp, or C Corp. It also includes procedures for changing your tax status later.
Member Information & Ownership	Lists every member's name, address, ownership percentage, and initial capital contribution. This section serves as the definitive internal record for ownership percentages and capital accounts.
Decision Making & Voting	It has all the ground rules for voting on major business decisions. It states whether a simple majority (51%) or unanimous vote (100%) is required for actions like taking on significant debt, changing the management structure, etc.
Membership Changes (Buy-Sell)	Outlines what happens when a member wants to leave, sell their ownership interest, or pass away. This section protects business continuity during ownership transitions and prevents disputes from escalating into litigation.
LLC Dissolution	Provides a clear process for closing the business, including settling debts with creditors, distributing remaining assets to members based on ownership percentages, and filing the Statement of Termination with the Illinois Secretary of State.

File For An Employer Identification Number (EIN)

Once you’ve registered your Illinois business, applying for an Employer Identification Number (EIN) is the final step. An EIN acts very much like a Social Security number, but it identifies a business entity rather than an individual. Single-member LLCs do not require an EIN if they’re not planning on hiring employees, but an EIN may be necessary for many other reasons.

Why Your Illinois LLC Needs An EIN

Hiring employees in Illinois
Opening a business bank account
Filing federal income taxes as a partnership or corporation
Applying for a business credit card
Registering for Illinois state taxes, including sales tax and withholding
Applying for local business licenses and permits
Protecting your personal Social Security Number on contracts and vendor agreements

How To Get Your EIN In Illinois

You can apply for an EIN directly through the IRS website at no federal cost, or have us file it for you. Our professional EIN filing service ensures your application is submitted correctly the first time, so you can move forward with banking, licensing, and state tax registration without delay.

Apply For Certificate Of Good Standing

Once your LLC is formed and you have your EIN, you may need a Certificate of Good Standing from the Illinois Secretary of State. This is a certified document confirming that your LLC was lawfully formed and is current on all state filings. Illinois banks, commercial landlords, insurance providers, and out-of-state licensing bodies frequently request it.

You can apply using Form LLC-50.25 for a small fee.
Standard processing takes up to 10 business days.
24-hour expedited processing is available for an additional fee.

Bibliography

FRED. Gross Domestic Product: All Industry Total in Illinois. Accessed on March 20, 2026.
SBA Office of Advocacy. 2025 Small Business Profile: Illinois. Accessed on March 20, 2026.
Association of American Railroads. Chicago's CREATE Program. Accessed on March 20, 2026.
Tax Foundation. Taxes In Illinois. Accessed on March 20, 2026.
Illinois.Gov. What is the tax rate for businesses, trusts, and estates. Accessed on March 20, 2026.
Tax Foundation. Illinois Tax Rates, Collections, and Burdens. Accessed on March 20, 2026.

Official IL Resources

Illinois Secretary of State. Online Business Filing.
Illinois Business Portal. One-stop guide for registration, licensing, permits, etc
Illinois Department of Revenue. Business Registration for state taxes.
Illinois Department of Revenue. Income Tax Rates.
Illinois Department of Professional and Financial Regulation. State-issued professional licenses for regulated industries.
Illinois Department of Employment Security. Employer registration, unemployment insurance contributions, and more.
SBA Illinois District Office, Chicago.
IRS EIN Online Application.
USPTO. Trademark Portal.

Need Help With Your LLC Paperwork?

Running a business in Illinois means competing in one of the largest state economies in the country. Managing legal business formation formality on top of sales and operations is where things start to get complicated.

Swyft Filings has been helping small businesses get started since 2015. Our team of business formation experts knows the Illinois Secretary of State's requirements inside and out and provides a fast, accurate, and fully compliant LLC formation service. Tell us about the business you want to build, and we will handle every piece of the paperwork.

FAQ's

Starting a business can feel complex. We're here to provide clear answers to some of the most common questions entrepreneurs ask.