Starting a Business in Illinois: Everything You Need to Know
To establish a business in Illinois, you'll need to take steps to comply with the legal requirements of the state and its local subdivisions. 2 min read
To establish a business in Illinois, you'll need to take steps to comply with the legal requirements of the state and its local subdivisions. This guide (along with professional advice for the more complicated issues) will help you avoid fines and penalties.
Name Your Business
Think of a few possible names for your business, then search Illinois's database of companies that have already registered with the Illinois Secretary of State. The database will help you determine if any of your names are available. To avoid confusion, Illinois law provides that two companies cannot have very similar names.
Any "fictitious name" for your business (in addition to the company's formal entity name) that you'd like to use will also need to be registered with the Secretary.
Pick an Entity Structure
You'll need a lawyer and accountant to consider the various legal and tax implications of forming your Illinois-based business as a sole proprietorship, corporation, general partnership, limited liability company, limited partnership, limited liability partnership or Illinois S Corporation. Once you've decided, file the required formation documents with the Secretary and pay the associated filing fees.
If the business will be operated as a sole proprietorship or general partnership you don't need to file formation documents, but any business name that you use that differs from the legal name of the owners must be registered as an "assumed name" in the Illinois counties where your business operates.
Obtain Permits and Licenses
Call the business permit office in each Illinois city, township, precinct, village and county where your company will be located to find out what permits and licenses you need to legally operate in those locations.
You may also need to obtain a specialized license or permit from Illinois for your business if it engages in certain activities.
Complete Federal, State and Local Tax Registrations
The Internal Revenue Service can issue an Employer Identification Number (EIN) for your business by phone or online. Your company will need this business analogue to a social security number for all federal tax purposes and to open a bank account.
You'll also need to establish accounts for your company's payment of income, sales and employee-related taxes with the Illinois Department of Revenue.
Call the tax offices of each Illinois city, township, precinct, village and county where your business will be located to determine what local taxes will be levied on your business and establish any required tax accounts.
Open a Bank Account
A bank account used exclusively for your business will make your record keeping easier. Choose a financial institution with branches in Illinois — your checks will clear more quickly, and it will be more convenient to obtain customer service.
Support for Illinois Startups
If you need assistance starting a business in Illinois, post your legal need on UpCounsel's marketplace. UpCounsel screens out 95 percent of lawyers to provide only the best lawyers from top law schools like Harvard Law School or Yale Law School. UpCounsel lawyers have an average of 14 years of experience and have provided legal services to companies such as Menlo Ventures, Airbnb and Google.