LLC & Corporation Setup and Administration in Illinois

Selecting the appropriate business structure is a critical decision that affects both the operational efficiency and long-term sustainability of your company. For medium to large businesses in Illinois, this choice has far-reaching implications, particularly when it comes to asset protection, tax management, and estate planning. At Wilson & Wilson Estate Planning & Elder Law LLC, we understand how to align your business structure with your broader financial and legacy goals. Whether you’re looking to form a Limited Liability Company (LLC) or a corporation, our comprehensive services ensure your business is built on a solid legal foundation while safeguarding your future.

Understanding the Process

Setting Up an LLC

Forming a Limited Liability Company provides flexibility, liability protection and a streamlined management structure. An LLC separates your personal assets from your business liabilities and offers the benefit of pass-through taxation, which can simplify financial reporting.

Steps to Establishing an LLC in Illinois include:

1. Choosing a Business Name. The name must be unique and distinguishable from any existing businesses registered in Illinois.
2. Appointing a Registered Agent. An LLC in Illinois requires a registered agent who can handle important legal documents on behalf of your business. This agent must have a physical presence in the state.
3. Filing Articles of Organization. This legal document formally creates your LLC. It includes key details such as the business name, address and the registered agent’s information.
4. Drafting an Operating Agreement. While not mandatory, an operating agreement is a best practice that defines the roles, responsibilities and profit-sharing arrangements among members.
5. Obtaining an Employer Identification Number (EIN). An EIN, issued by the IRS, is necessary to open a business bank account, hire employees and ensure compliance with tax regulations.

Setting Up a Corporation

A corporation is ideal for companies expecting significant growth or planning to attract outside investors. It is a distinct legal entity that offers strong liability protection and allows for issuing stock to shareholders.

Steps to Incorporating in Illinois include:

1. Choosing a Corporate Name. Similar to LLCs, the chosen name must comply with state guidelines and availability checks. It must include identifiers such as “Inc.” or “Corporation.”
2. Filing Articles of Incorporation. This step creates the corporation and includes details about the corporate structure, registered agent and capital stock.
3. Preparing Corporate Bylaws. Bylaws outline operational procedures and establish governance, including the roles of directors and officers.
4. Appointing Directors and Holding Initial Board Meetings. Directors are responsible for adopting bylaws, electing officers and managing the corporation’s affairs. Proper documentation of these meetings is crucial.
5. Issuing Stock Certificates. For corporations, stock issuance formalizes ownership and provides a tool for raising capital from investors.
6. Filing an Annual Report. Illinois requires corporations to submit annual reports to remain in good standing with the state.