Form an LLC in Illinois: Filing, Fees and the Annual Report

What is different about forming an LLC in Illinois

An Illinois LLC name must contain "limited liability company", "L.L.C." or "LLC", or "L3C" for a low-profit company, and 805 ILCS 180/1-10(a)(4) bars it from containing "Corporation," "Corp.," "Incorporated," "Inc.," "Ltd.," "Co.," "Limited Partnership" or "L.P." Subsection (d) then tests the name for distinguishability against five separate registers at once.

Expedited service here is defined by channel as well as by fee. Section 50-50(d) calls it "services rendered within the same day, or within 24 hours from the time, the request therefor is submitted", and a filing is not an expedite request "solely because of its submission by electronic means".

The assumed name fee is set by the last digit of the calendar year: $150 in a year ending in 0 or 5, $120 in 1 or 6, $90 in 2 or 7, $60 in 3 or 8, and $30 in 4 or 9. A delinquency also freezes the whole file: under Section 50-15(b) the Secretary of State "shall not file any additional documents, amendments, reports, or other papers" for a delinquent company.

Filing the articles of organization

The formation document is the Articles of Organization, form LLC-5.5, filed with the Secretary of State's Department of Business Services under 805 ILCS 180/5-5. The fee is $150, or $400 on form LLC-5.5(S) for a company with a series or the ability to establish one. The paper form is headed "SUBMIT IN DUPLICATE" and carries the filing address: Rm. 351, 501 S. Second St., Springfield, IL 62756.

Section 5-5(a) requires the articles to give, among other items, the principal place of business, the purposes for which the company is organized, the registered agent and registered office, every manager and any member having a manager's authority, the duration, "which shall be perpetual unless otherwise stated". That principal place of business "may, but need not be a place of business in this State". Organizers are "One or more persons, other than natural persons under 18 years of age", and each organizer of a company formed to practise medicine "shall be a licensed physician of this State or an attorney licensed to practice law in this State".

The articles take effect on filing or on a stated later date "not to exceed 60 days after the filing date". On paper the form takes a certified check, a cashier's check, an Illinois attorney's or C.P.A.'s check, or a money order payable to Secretary of State, and cash is not accepted.

Filing online, processing and expedite

The online application is "LLC Articles of Organization", at https://apps.ilsos.gov/llcarticles/index.jsp. To use it a company must "Not be formed in another state or jurisdiction" and must not be required to use a specific purpose or provisions. The Secretary of State's "Information for Forming an LLC Online" page prices that filing as "Articles of Organization $150 (10 business days); $250 (24-hour service)". No processing time is published for a paper filing.

The statutory expedited fee for the articles is $100 on top of the filing fee. The Department's forms page adds that "Requests for expedited service must be made in person, not by mail in the Department's Springfield or Chicago office", while marking the articles as a filing whose expedited option is also available online. Online annual reports and requests for certificates of good standing cannot be expedited at all.

Naming the company

A name is not distinguishable solely because it differs by "The word 'limited', 'liability' or 'company'" or by an article, conjunction, contraction or abbreviation. The name of an administratively dissolved Illinois LLC "is not available for use by another LLC or Corporation until three years have elapsed following the date of issuance of the notice of dissolution."

A company providing services licensed by the Illinois Department of Professional Regulation must carry "Professional Limited Liability Company", "PLLC" or "P.L.L.C." in its name. Availability is checked on the Business Entity Search at https://apps.ilsos.gov/businessentitysearch/. Reserving a name costs $25 and holds it for 90 days.

Assumed names

An Illinois LLC files its assumed name application in duplicate with the Secretary of State under Section 1-20 before transacting business under that name. The registration runs to the first day of the anniversary month "that falls within the next calendar year evenly divisible by 5", and is renewed for five years at $150 within the 60 days before expiry, by electing to do so when filing the annual report. If the fee and a $100 late fee go unpaid for 60 days after the Secretary mails notice, the right to the name ceases. A company advertising under a name it is not authorized to use "is guilty of a petty offense and shall be fined not less than $501 and not more than $1,000", with a separate offense for each day.

Registered agent and registered office

Section 1-35(a) requires the company to "continuously maintain in this State a registered agent and registered office", the agent being "an individual resident of this State or other person authorized to transact business in this State". The registered office must sit in Illinois, must be a street or road address or a rural route and box number rather than a P.O. Box alone, and must be identical to the agent's business office address. Every notice the Secretary of State initiates is mailed to the registered agent in Illinois at that address.

Changing the agent or the registered office costs $25. A resignation takes effect no sooner than 30 days after filing, and a replacement must be on record within 60 days. A company that does not appoint one within 60 days of the resigning agent's notification is declared delinquent and not in good standing, and the same failure is a ground for administrative dissolution.

The annual report

Every Illinois LLC and every admitted foreign LLC files an annual report under 805 ILCS 180/50-1, listing its registered office and agent, its principal place of business, and its managers and any member with a manager's authority. It "shall be delivered to the Secretary of State within 60 days immediately preceding the first day of the anniversary month", the month containing the anniversary of the date the articles were filed. The fee is $75, plus $50 for each series whose certificate of designation is in effect on the last day of the third month preceding the anniversary month. Publication C 334 marks the report for "Real-time processing available online. No expedited fee required."

The penalty grows with time. Section 50-15(b)(1) charges "a penalty of $100 plus $100 for each year or fraction thereof beginning with the second year of delinquency", attaching once the company fails to comply before the first day of the second month after its anniversary month.

Administrative dissolution can follow from any of six grounds, among them the unfiled report, losing the registered agent, and tendering a payment returned for insufficient funds. The Secretary mails a notice of delinquency to the registered office; the company then has 120 days following that notice to correct a report default. Reinstatement costs $200 and takes the application plus every report, fee and penalty then due. Once granted, existence "shall be deemed to have continued without interruption". Voluntarily dissolving an Illinois LLC costs $5 for a statement of termination, and amending the articles costs $50.

Illinois taxes

An Illinois LLC classified as a partnership for federal purposes is a "partnership" under 35 ILCS 5/1501(a)(16), which makes it liable for the Personal Property Tax Replacement Income Tax at 1.5% of net income, reported on Form IL-1065 "on or before the 15th day of the 4th month following the close of the tax year". Individual income tax runs at 4.95% of net income and the state sales tax at 6.25% of gross receipts. The Secretary of State's complete schedule of LLC fees carries no franchise tax.

A partnership other than a publicly traded or investment partnership must also withhold from each nonresident partner on that partner's distributable share of Illinois income. It may instead elect an entity-level tax of 4.95% of net income, separately for each taxable year and irrevocably once made. For taxable years ending on or after December 31, 2026, an electing partnership also picks annually between the "Full distributive share method" and the "Illinois-sourced income method". Illinois LLC taxes are administered by the Department of Revenue, which requires registration before any purchases, sales or hiring, through MyTax Illinois on Form REG-1 in 1 to 2 business days, or on paper in 4 to 6 weeks.

Licensed professions

A company providing a service licensed by the Department of Financial and Professional Regulation "must be formed in compliance with the Professional Limited Liability Company Act". It may not open, operate or maintain an establishment without a certificate of registration from that Department, issued "upon payment of a registration fee of $50". Operating without one draws a notice of violation, the $50 fee plus "a late fee of $100 for each year" capped at $500, and a civil penalty of up to $1,000. A company organized to practise law instead needs a certificate from the Supreme Court of Illinois at $50, renewed at $40 per year and "conspicuously posted upon the premises", and may have "only those offices that are designated by street address in the articles of organization".

Series and low-profit companies

An Illinois operating agreement may establish series. For a series to hold its own liability shield under Section 37-40, separate records must be kept, the assets held and accounted for separately, notice of the limitation set out in the articles, and a certificate of designation filed for each series at $50. A series name "must commence with the entire name of the limited liability company".

A low-profit limited liability company must significantly further a charitable or educational purpose within Section 170(c)(2)(B) of the Internal Revenue Code of 1986, must say so in its articles, and must carry "L3C" in its name.

Foreign LLCs

A foreign company completes form LLC 45.5, Application for Admission to Transact Business, and "Forms must be submitted in duplicate and accompanied by a certificate of good standing from the state where the company is organized." The fee is $150, or $400 with a series. Its agent must be an Illinois resident, a domestic corporation, or a foreign corporation with a place of business in and authorized to do business in Illinois. A company that has not been admitted "may not maintain a civil action in any court of this State", and one still unadmitted 60 days after it commences transacting business owes "a penalty of $2,000 plus $100 for each month or fraction thereof". Owning property without more, or having a member or manager who is an Illinois resident, is not transacting business, so foreign LLC registration in Illinois turns on activity.

Operating agreement and EIN

Members "may enter into an operating agreement to regulate the affairs of the company". Illinois recognizes one "whether oral, in a record, implied, or in any combination thereof", and it is not among the documents the Secretary of State files. See the operating agreement guide. An EIN comes from the IRS rather than from an Illinois agency; see the EIN guide.

Frequently asked questions

How much does it cost to form an LLC in Illinois?

805 ILCS 180/50-10(b)(1) sets the fee for filing articles of organization at $150, and at $400 for a company with a series or the ability to establish one. Expedited service on the articles is $100 more under 805 ILCS 180/50-50(e).

How long does Illinois take to process articles of organization?

The Secretary of State's Information for Forming an LLC Online page prices the articles at $150 with 10 business days, and at $250 for 24-hour service. The Secretary of State publishes no processing time for a paper filing.

When is the Illinois LLC annual report due?

805 ILCS 180/50-1(b) requires the annual report to be delivered to the Secretary of State within the 60 days immediately preceding the first day of the LLC's anniversary month. The fee is $75, plus $50 for each series with a certificate of designation in effect.

Can an Illinois LLC name contain Inc. or Co.?

No. 805 ILCS 180/1-10(a)(4) bars an Illinois LLC name from containing the terms Corporation, Corp., Incorporated, Inc., Ltd., Co., Limited Partnership or L.P. The name must instead contain limited liability company, L.L.C. or LLC, or L3C for a low-profit company.

What happens if an Illinois LLC misses its annual report?

805 ILCS 180/50-15(b)(1) imposes a penalty of $100 plus $100 for each year or fraction of a year beginning with the second year of delinquency. The Secretary of State also files no further documents for the company, and administrative dissolution can follow 120 days after a notice of delinquency.