As an overall rule when starting a business in Illinois, you are to pick a business name that does not closely resemble with any other existing registered business name. In essence, it should uniquely be an identification for your business.
In addition, Illinois state laws specify that the business name should have any of the following: ‘Corporation’, ‘Company’, ‘Incorporated’, or ‘Limited’. Alternatively, an abbreviation of any of the mentioned words above will also do. To ensure that your business name is still valid and not taken, you can double check this using the Illinois business name search tool. You can have the name reserved until 90 days with the Secretary of State.
The most crucial process to incorporating in Illinois is to file an Articles of Incorporation. When filing a Corporation in Illinois, this means that you are legally incorporating your business to operate in the state.
The following information is required when filing for an Articles of Incorporation: name and address of the Corporation, name and address of Registered Agent; Corporation’s statement of purpose. Additional information will also be required, so make sure to double check the form. An online application or post mail can be done for filing an Articles of Incorporation.
Filing fee: $150 plus preliminary payment for franchise tax at a minimum rate of $25
A Registered Agent is an indispensable asset to your Corporation. The main function of an Illinois Registered Agent is to act as a representative to receive service of process and other legal notifications forwarded by the Secretary of State for your business. When you hire a Registered Agent in Illinois, keep the following requirements in mind:
(1) a Registered Agent may be a person who is a resident of Illinois or a business entity, either domestic or foreign, that is registered with the Secretary of State; (2) a Registered Agent must provide a physical address in Illinois; (3) a Registered Agent must consent to be the Agent in your business before designation.
That said, you can hire a Registered Agent service and pay up to $160/year, or get an Illinois Registered Agent free of charge when you form your Corporation with IncFile – which is $100 less than other online incorporation services.
A Corporate Records Book is the record holder of all your corporate papers including your Illinois Corporation registration documents. This book will hold the important documents of your Corporation, and it should be stored in your business office for easier access when needed.
To purchase a Corporate Records Book, you can go to the local office supply chain or order through Amazon.
It is the responsibility of the incorporator of the Illinois Corporation to elect the initial directors for the business when forming a Corporation in Illinois. This is done so that the initial agenda when starting a Corporation can be addressed and decided upon immediately.
As soon as you have elected the directors, an Incorporator’s Statement should be made, which contains the name and address of each initial director.
The next order of things when starting an Illinois Corporation is to then hold the initial meeting with the board of directors and you, the incorporator. The following points must be discussed and resolved:
Note: An S Corp status should also be approved as of this time if the Corporation decides to do so. Minutes of the meeting should be prepared to be signed by all attendees of the meeting and stored in the Corporate Records Book.
To ensure that you will not face penalties, fines, and fees when operating a business, you need to completely fulfill your Illinois business taxes and licenses obligations to the state. To get started, follow the steps below for Illinois Corporation maintenance.
For Illinois business licenses, compliance is also a must. As the licenses and permits can vary depending on a number of factors, a thorough research of what needs to be completed should be a priority. To figure out some possible requirements in business licenses, use our guide on Illinois Business Licenses and Regulations.
While starting an Illinois Corporation, it’s important to keep your business and personal bank accounts separate. This keeps your personal liability at a minimum and makes tax time much more simple.
For a close up look at the best places to open a business checking account for your Corporation, visit this quick roundup.
Now that you have followed the steps above, you are officially an Illinois Corporation. Other than those 8 steps that are based on state guidelines, here are a few additional steps based on best practices for starting a successful Corporation. Not required, but highly recommended.
A business plan is not just important to achieve business goals and experience steady financial growth. Before any of that happens, a business plan is an indispensable tool for getting funding capital for your startup.
Investors look into your business idea and how profitable it is through your business plan. Therefore, start making that effective business plan now with some of the resources below.
In the past decade, technology has become more and more important to business owners. That is why the next step to starting a business in Illinois is to build a professional website.
Rather than spending thousands on a custom design, I recommend you do it yourself through WordPress. WordPress is easy to use, customize, and present your business in a professional manner.
When you’re creating a Corporation, there should be a set of basic rules to keep your business operations in order.
This is the main purpose of your Illinois Corporation bylaws. Aside from establishing the internal rules of your business operations, the corporate bylaws also serve as evidence for your legitimacy to external entities that operate regularly with your business.
Note that this How to Form a Corporation guide is just an informational guide, and it should never be considered a legal document or advice. Use this for information purposes only. The expertise of a business attorney should only be your source of legal advice when it comes to the specifics of how to form a Corporation in Illinois or starting a business in Illinois.