How to Form an LLC in Illinois (2026 Guide)
Updated: August 2026 · Industry Advisors · Filed 2006.
Illinois sits in the middle of the LLC-friendliness spectrum. Formation fees are on the higher end. The annual report is straightforward. Illinois does not impose a separate LLC-level franchise tax the way California does. What Illinois asks of founders is attention to the anniversary-month deadline and the Personal Property Replacement Tax (PPRT) that applies to LLCs classified as partnerships or S-Corps for federal tax purposes.
Step 1 · the Formation Timeline
- Filing agency — Illinois Secretary of State, Business Services
- Form — LLC-5.5 (Articles of Organization)
- Filing fee — $150 est.; expedited processing +$100 for 24-hour turnaround
- Processing time — 10 business days standard, 24 hours expedited
- Registered agent — IL resident or authorized entity with physical IL address
- State income tax — flat 4.95%
- PPRT — 1.5% on IL net income for LLCs taxed as partnerships or S-Corps
Step 2 · the Anniversary-Month Deadline
Unlike states with a fixed calendar date, Illinois ties the annual-report deadline to the anniversary month. Report is due before the first day of the anniversary month. Formed June 12 → report due before June 1.
Step 3 · PPRT and the Tax Structure
Step 4 · Recurring Calendar
Quick Tool · IL LLC Year-One Cost Estimator
Estimate Your IL Year-One Setup Cost
Expand each row that applies.
Articles of Organization (LLC-5.5)
$150 est.; add $100 for 24-hour expedited processing.
Registered agent (if paid)
$100–$300/yr est. — skip if an IL-resident member serves.
Annual Report (year 2 onward)
$75 due before the first day of your anniversary month. $100 late fee.
Illinois REG-1 tax registration
Free registration with the IL Department of Revenue if you have employees, sell taxable goods, or need a Retailer's Occupation Tax number.
PPRT (Personal Property Replacement Tax)
1.5% on IL net income — applies if LLC is classified as partnership or S-Corp federally. Single-member LLCs (disregarded) do not owe PPRT directly.
Chicago business license (if operating in Chicago)
$250–$1,000+/yr est. through BACP; two-year license cycles common. Additional zoning approval may apply.
Series LLC (real estate multi-property structure)
$400+ est. filing plus additional annual reports; consult an IL attorney before choosing this structure.
Typical first-year total for a small IL LLC: $275–$1,025 est.
Illinois Quirks Worth Knowing...
- Series LLC option. Illinois offers a Series LLC — useful for real-estate investors with multiple properties. More expensive to file, more paperwork ongoing. Talk to an IL attorney.
- Anniversary-month deadline is unusual. Set a calendar reminder 30 days before the first day of your anniversary month.
- Chicago-specific taxes. Businesses operating in the City of Chicago face additional Business License registration and specific industry taxes through BACP.
- PPRT applies to multi-member LLCs and S-Corps. The 1.5% PPRT is separate from personal income tax and often surprises members in year one.
Quick Check
Q1. Your IL LLC was formed on October 22. When is the annual report due?
Answer: Before October 1 each year. Illinois requires filing before the first day of the anniversary month.
Q2. Your two-member IL LLC nets $200,000 in IL net income. What PPRT do you owe?
Answer: Roughly $3,000 (1.5% of $200,000). Separate from members' personal 4.95% income tax.
Q3. A single-member LLC (disregarded entity) with $150,000 IL net income — does it owe PPRT?
Answer: No. PPRT applies to LLCs taxed as partnerships or S-Corps. Single-member disregarded entities are treated as the owner for tax purposes.
Where This Connects
Core LLC stack: registered agent, EIN, Operating Agreement. Ongoing cadence rolls with the Q4 checklist. Federal filings including estimated tax align with the Sept 15 deadline post. For multi-member governance, see the Operating Agreement clauses post. For S-Corp election considerations, see the S-Corp election window.
Sources and Further Reading
- Illinois Secretary of State · Business Services
- Illinois Department of Revenue · Business Taxes
- IRS · LLC Tax Information
The Everyday Owner's Blueprint handles the underlying LLC stack; layer the anniversary-month + PPRT calendar on top of the 12-week formation walk-through.
Industry Advisors · 30 Wall Street, New York, NY 10005. Education, not legal or tax advice. Illinois rules and fees change; confirm current requirements at ilsos.gov and tax.illinois.gov before you file.
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