Illinois became the 21st state in December 1818. Because the 16th president spent his early years in the state, Illinois has been dubbed the “Land of Lincoln”. The 20th century brought Illinois into its status as one of the leading states in business, commerce, education, housing services, and many other areas.
Aside from the service industry, which contributes the largest dollar amount to the state’s economy, manufacturing and mining are the two top industries in Illinois. It has the 4th largest manufacturing industry in the country and has exported more than 8 billion tons of coal and 4 billion barrels of petroleum. Nearly 80% of the land in Illinois is farmland. It is a leading farm income state, and corn is its most important crop, followed closely by Soybeans, hay, wheat, rye, oats, and grain.
The Illinois College of Business is nationally recognized as one of the country’s leading business schools, which makes finding local talent less of a challenge.
Major Companies In Illinois
Walgreen Co. tops the list of Illinois’ largest companies, employing more workers than any other business in the state. They are followed by McDonald’s, Boeing, Caterpillar, and a handful of holdings companies, like United Continental, Sears, and Mondelez International.
Illinois Startup Environment
According to the Illinois Department of Commerce, the Prairie State ranked #6 in the US for the highest number of business registrations. It also ranked #8 in the nation for business startup growth. among the best states to start a small business. Many entrepreneurs find Illinois to be pro-business, but also pro-family and work/life balance, so it’s no surprise why startups are doing business there.
The entity type you choose will determine how taxes are reported and paid. Most small businesses prefer simple business management, so it’s important to find the best fit for your company. If you’re not sure which type to choose, you can contact an accountant or attorney to help you make the best choice.
An Assumed Name, also known as “Doing Business As”, or DBA is a name used to identify a business. It is not a business entity and does not offer any liability protection. An Assumed Name can be useful if you’re running several different businesses under one LLC or Corporation. So for example, Ace may register his company as ACE LLC, but his boating, auto, and water sports businesses run under separate assumed names.
A Corporation is an entity that carries its own liability, so it provides limited liability protection for the owner(s) (shareholders, directors, and/or officers). A Corporation is more complex to manage and report taxes than an Assumed Name or LLC (below). Investors prefer to work with Corporations because their interests are protected. So it’s usually larger companies and startups that raise funding that form this type of entity.
NOTE: Some professions require registering a business as a “Professional Corporation” or PC. This requirement applies to industries, like law, medicine, engineering, etc.
The LLC entity type has become the preferred formation for startups and small businesses. It’s a separate entity that offers limited liability to owners and is easier to manage than a Corporation. Taxation is reported on owner(s’) personal tax returns, and the company itself does not file a corporate tax return. Simple management, taxation, and ownership flexibility are the top reasons why startups choose the LLC business structure.
Creating a unique name that stands out can have a big impact on your business. The process to find a good name isn’t hard, but you do want to take the time to develop a name that identifies your products or services, is easy to remember, and can grow with your company.
What’s the nature of your business? Are you offering products or services? Who is your target market? Answering these questions will point you to words you can incorporate into a successful name. If your focus market is online, make sure your name isn’t too local or regional. If you do want to attract local business, adding an area or zip code, city name, or community name will help you reach the closest crowd.
Once you have a few name ideas, search Google and other search engines to find the same or similar names. Make sure to use various spellings, and even misspellings to locate potential conflicts. Change your name if you find near matches to prevent tax and legal mix-ups with other companies. Search names until you find one that is unique, then search Illinois state sites to make sure the name isn’t already in use.
IMPORTANT: National and Global businesses need to take extra steps to create a custom business identity to avoid being named in legal and tax matters by mistake.
You can hire a trademark specialist to search the USPTO database and file a trademark on your name. But the fees are pretty high, and we have found that doing your own name searches is sufficient and you can save a lot of money. Searching the USPTO site will tell you if there are name conflicts that weren’t found in internet searches. Make sure to use various spellings and misspellings to clear your name.
Now that you have a stand-out name for your business, it’s time to register your Assumed Name or company.
All Illinois businesses that want to use an assumed name must register with the state. Assumed names are usually filed with your county, and you can find your county clerk’s office by searching “YOURCOUNTY county recorder”. Illinois.gov has forms available for download. Simply complete the forms and submit them with the filing fee to register the name.
NOTE: Our Corporation formation package includes not only filing the Articles of Organization (we’ll prepare and submit them to the state) but all the necessary post-formation documents completed and personalized to you “ready for signature” as well as our exclusive Startup Wizard which guides you through the complete startup process from formation to bank accounts, logos and more.
You can skip this checklist and file an Illinois business registration with fast and affordable services by MyCompanyWorks. Save time and manage your company in one place with any of our startup packages and our exclusive Startup Wizard.
(Optional for DBAs without employees, but recommended to help prevent identity theft)
An Employer Identification Number is assigned by the IRS to identify businesses with employees. Almost every tax and business document will require your EIN, and you need one if you’re going to hire workers (even yourself). The tax ID is required for Corporations and LLCs and optional for DBAs if you don’t have employees. If you operate under a DBA an EIN, you’ll have to use your Social Security Number instead.
NOTE: International founders must apply by phone, or we can apply for you with any business formation package.
The only way to keep business and personal funds and assets separate are to open separate accounts for your company. You can search the Internet and check with local banks for business banking solutions. You may not qualify right away, but if you keep your bills paid on time, eventually you’ll be able to apply for business credit cards and funding. A healthy business credit profile is ideal to attract investors and request larger loans from lenders. Requirements vary by lending institution, but you can expect to submit the following information when you’re applying for a bank account and business credit.
Top Business Banks in Illinois
TIP: Our Business Formation packages include free banking solutions.
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By now your business should be registered, but you still have to carry the proper business licenses and permits to legally operate. Each state has different requirements for various businesses, so you’ll need to contact the state or a business licensing service to make sure you apply for the correct permits.
Apply online with our Business License partners
Insurance varies by industry, but our business insurance partners can help you find the right policies. In general, companies have at least the following three policies:
Our Business Insurance partners are standing by with free quotes and exclusive pricing
Every business needs an accurate accounting system and a process for keeping records organized. Businesses get audited for various reasons, so keeping your finances and files straight is crucial to prove that taxes are accurate and avoid penalties and interest on back taxes. You can find out more about accounting and financial management in our guide.
Most business documents should be kept for at least three years, and tax returns and other financial documents should be filed away for at least seven years. Read more about keeping business documents.
Once your systems are up and running, you can document your processes to automate and systemize as much of your business as possible. If you have a solid system for managing bills, payroll, taxes, and administrative tasks, it would be much easier for someone to run the business, or even buy it in the future. A simple system will free you to work on growing your business. Here are some resources to help you manage your business.
(Skip to Step 10 if you aren’t hiring employees)
As long as you have an active Employer ID Number and the appropriate insurance, you can hire and pay employees in the US. You can add an EIN application to any of our startup packages. You may also have to register as an employer in the state of Illinois before you hire help. Employees must complete form I-9 and IRS form W-4 with identification to be recognized as a worker for your business. Illinois may also have employer registration requirements, so make sure to check with the state before you start the hiring process.
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By now you should be a legally registered, licensed, and insured business in the state of Illinois. Your business identity and marketing are critical to your success, so it’s important to develop an effective logo, website, and open social accounts to get the word out. More than 2/3 of all consumers look for an active website to decide if they want to shop with a particular company.
Now that you’ve set up the company for success, you need to get the word out. Our guide to creating a simple marketing plan and other resources on our site will help you plan and grow your customer base.
Launch a custom website fast with our Domain, Email, and Website packages
DBA: An Illinois DBA (Assumed Name) should be valid for five years, unless changes are made to the business name or other information on the certificated. Changes must be filed right away with your county.
LLC: Illinois requires both annual reports and an annual franchise tax return. Each filing is due within a 60-day period immediately preceding the first day of the month of incorporation. The fee is $77.
Corporation: Your business must keep corporate records at its principal place of business. Every year, an officer of your corporation must file an annual report due before the first day of the anniversary month of incorporation. Generally, this report can be filed electronically unless:
Franchise Taxes: Illinois businesses are required to file a $75 annual report with a $25 minimum franchise tax, based on your company’s paid-in capital. The franchise tax form in Illinois is widely decried as being one of the most complicated in the country – it’s, therefore, advisable to work through your corporate taxes with an accountant.
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Illinois Secretary of State
213 State Capitol
Springfield, IL 62756
217-785-3000 (outside Illinois)
800-252-8980 (toll-free in Illinois)
Illinois State Taxation Departments
Illinois State Labor and Employment Departments
Illinois State Startup Resources
1. Small Business Administration (SBA) Illinois State District Offices
2. SCORE Volunteer Mentors
SCORE resources are very helpful for startups and available from a number of branches throughout Illinois. Connecting with a SCORE mentor can help you avoid common pitfalls as you start your business.
3. Illinois State Legal Statutes:
4. Illinois State Chambers of Commerce
5. Illinois Angel Investors
6. Illinois State Business News
7. Illinois State Small Business Development Center
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Thank you for all your help. Your company has been very helpful and supportive in my new venture. I would recommend you to anyone who wants to start a new business.
Excellent job on the LLC formation! Great follow-up info in the package to get me started, too! Thanks!!
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Service was professional and quick. I like the portal and how it stores my documents for me. I also liked the handbook and how it laid out everything for me.
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Excellent in all aspects. Perfect for new business owners with limited resources but wants to start it off right.