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Every step to open an LLC in Illinois and get ready to hire, in order, with the official state page for each one. Agencies you'll deal with: Secretary of State · Department of Revenue (MyTax Illinois) · IDES · Department of Labor · Workers' Compensation Commission · Department of Human Rights · State Treasurer.
This is the most common path: a new LLC, general business, paying W-2 employees and 1099 contractors. Adding a location, forming a corporation, or in a licensed industry? Customize it and check off steps as you go.
Customize this checklistPopular Illinois business types:
Do this first. The state tax and payroll accounts ask for your registration details.
Apply free on the IRS website and get the number immediately. You'll need it for the state tax registration, a business bank account, and payroll. Opening a new location? You already have one; the same EIN works in every state.
This internal document sets out who owns what, how decisions get made, and what happens if an owner leaves. It isn't filed with the state, but banks often ask for it, and it helps protect your liability shield. Single-owner LLCs need one too.
Bring your EIN letter, filed formation documents, and operating agreement or bylaws. Keeping business and personal money separate is one of the main things that protects your personal assets.
Many businesses need a license or permit before opening, separate from registering the company. Check three levels: the state licensing board for your field, your city or county, and any federal agency that regulates your industry.
If you want S corp taxation, file IRS Form 2553. The deadline is tight: generally within 2 months and 15 days after the start of the tax year you want it to apply. See Business basics for when it makes sense.
File Articles of Organization (or the state's equivalent) online through Secretary of State online filing (Business Services).
You need a registered agent with a street address in Illinois to receive legal papers and state notices. Use a registered agent service if you have no one local.
LLCs and corporations file assumed names with the Secretary of State. Sole proprietors and partnerships file with the county clerk.
LLCs with series pay $400 instead of $150. Corporations also owe Illinois franchise tax with their initial and annual filings.
Register for withholding and sales tax with the Department of Revenue through MyTax Illinois. Register for unemployment insurance with IDES (also through MyTax Illinois) within 30 days of starting.
No city or county income tax. Chicago and suburban Cook County set their own minimum wage and paid leave rules, and many cities require a local business license.
New businesses with employees must register with IDES within 30 days of starting. Use MyTax Illinois or Form REG-UI-1.
Applies if you sell products, or services this state taxes. Most medical care is exempt. See Business basics for sales tax.
Illinois calls it a Certificate of Registration (Retailers' Occupation Tax). Register with the Illinois Department of Revenue through MyTax Illinois (Form REG-1) before you make your first taxable sale in Illinois. You'll collect tax from customers and send it to the state.
Give your supplier Form CRT-61, Certificate of Resale so you don't pay tax on inventory you'll resell. The buyer must have an active Illinois account ID (or an out-of-state resale certificate), and blanket certificates should be updated at least every 3 years; sellers keep them at least 3.5 years. Keep certificates your own customers give you, too.
Out-of-state sellers must register once sales into Illinois pass $100,000 (rolling 12-month lookback, checked each quarter), even with no office here.
Effective January 1, 2026, the 1% state tax on groceries ended, but cities and counties may impose their own 1% local grocery tax. Also from 2026, sales reported without required location info may be taxed at a 15% undetermined-location rate.
Applies once you pay W-2 employees who work in this state.
Form I-9 is never mailed to the government. You keep it in your own files and show it only if ICE or the Department of Labor asks for an inspection.
Federal posters (minimum wage, EEO, FMLA if you have 50+ employees, and others) go alongside the state ones.
Register once you pay wages to employees working in Illinois. Reports and payments are usually quarterly.
Required at Most employers, regardless of size. No state fund. Buy a policy from a private insurer or get IWCC approval to self-insure.
Report within 20 days of the first day on payroll. IDES asks employers to report independent contractors too. Report online, by mail or fax.
Iowa, Kentucky, Michigan and Wisconsin residents can be exempt from Illinois withholding by giving Form IL-W-5-NR.
Illinois's wage payment rules:
$15.00 an hour.
Paid Leave for All Workers Act: employers of any size give 1 hour of paid leave per 40 hours worked, up to 40 hours a year, usable for any reason after 90 days.
Employers with 5+ Illinois employees in every quarter of the prior year, in business 2+ years, with no qualified plan must offer a plan or register. Penalty: $250 per employee the first year, $500 per employee each later year.
All employers must give every Illinois employee sexual harassment prevention training each year. Restaurants and bars need extra training. IDHR offers a free model.
Display the state's required labor law posters where employees can see them, along with the federal posters. Workers' comp notices come from your carrier.
These local laws apply to employees who work within the city or county, on top of the state rules. Where they differ, follow whichever is more generous to the employee.
The W-9 gives you the contractor's legal name and tax ID for their 1099. Check the classification first: if you control how and when they work, they may legally be an employee.
File with the IRS and send the contractor a copy by January 31. For payments made in 2026 and later, the reporting threshold is $2,000 per contractor per year (it was $600 before).
Recurring deadlines. Put these on your calendar now.
FinCEN's final rule, effective August 14, 2026, permanently exempts companies formed in the U.S. from beneficial ownership reporting. Ignore letters or emails demanding a BOI filing fee; they're a common scam. Only companies formed outside the U.S. still file.
Employers in Chicago or suburban Cook County follow local paid leave ordinances instead of the state act. Chicago revised its Paid Leave and Paid Sick and Safe Leave rules effective June 1, 2026.
The Department of Revenue enforces the retirement mandate. You have 120 days after a proposed penalty notice to comply or ask for a hearing.
Keeps your business in good standing with the state. Missing it can lead to penalties or dissolution.
Corporations pay Illinois franchise tax based on paid-in capital, reported with the annual report. Pass-through entities owe the Personal Property Replacement Income Tax.
File unemployment wage reports each quarter and state withholding returns on the schedule you're assigned (if the state has income tax), plus the annual W-2 reconciliation.
Returns (Form ST-1) are generally monthly, due the 20th of the next month; the state may allow quarterly filing if average monthly tax is $200 or less, or annual if $50 or less (due January 20). File a zero return if you had no sales; skipping it can bring penalties.
Recurring dates for Illinois and federal filings. A payroll service handles most payroll lines, but you should know they're happening.
| When | What | Filed with |
|---|---|---|
| Jan 31 | Q4 UI-3/40 wage report due to IDES | Illinois |
| Apr 30 | Q1 UI-3/40 wage report due to IDES | Illinois |
| Jul 1 | Chicago and Cook County minimum wage changes; Chicago annual employee notice | Illinois |
| Jul 31 | Q2 UI-3/40 wage report due to IDES | Illinois |
| Oct 31 | Q3 UI-3/40 wage report due to IDES | Illinois |
| Before anniversary month | Secretary of State annual report ($75) | Illinois |
| Assigned schedule | Sales tax return (file a zero return if no sales) | Illinois |
| Jan 31 | W-2s to employees and SSA (with W-3); Form 940; 4th-quarter Form 941 | IRS / SSA |
| Jan 31 | 1099-NEC to contractors and IRS | IRS |
| 15th monthly | Federal payroll tax deposit (monthly depositors) | IRS |
| Apr 30 · Jul 31 · Oct 31 | Form 941 for the quarter | IRS |
| Jul 31 | Form 5500 or 5500-SF, if you sponsor a 401(k) (Oct 15 with Form 5558 extension) | DOL (EFAST2) |
Last verified: October 27, 2026
The Illinois state filing fee for an LLC is $150. That's the fee to form your LLC with the state. Expect other costs too, such as a registered agent service if you use one, licenses, and annual filings. See the checklist above for each step.
You need to register to collect sales tax in Illinois if you sell taxable products or services there. The state rate is 6.25%, and local taxes may add to it. Registration cost: See state site.
Out-of-state sellers must register once their sales into Illinois pass $100,000 a year. Having an employee or office in Illinois also creates nexus right away.
Recurring filings include: file the Annual Report; file quarterly unemployment reports and withholding returns; file sales tax returns on time. The deadline calendar above lists the dates.
This guide organizes official requirements. It isn't legal or tax advice. Fees, forms, and deadlines change, so confirm on each linked state page before you file, and talk to an attorney or CPA about your specific situation.
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