23 August 2022

Hey luv,

Are you considering setting up your Illinois business as a limited liability company but not sure where to start?

Setting up your business as an Illinois LLC can have benefits and drawbacks, just like any other business form. Depending on the types of business structures you’re evaluating, a certain aspect could be an advantage or a disadvantage.

Because it gives the same limited liability as a corporation with less formality in its formation and operation, an Illinois LLC is regarded as favorable. There is a little more to it than that, as will be clear, though.

The federal tax choice made by the LLC will affect LLC taxes in Illinois. All Illinois LLC profits are distributed evenly among the members unless the LLC chooses to be taxed as a C corporation. Even if they do not really receive a share of the profits, the members must pay Illinois, federal, and self-employment taxes on their portion of the earnings.

Each member of an LLC that is taxed as a C corporation must pay state and federal income taxes on any profits that are actually distributed to the member and Illinois corporate taxes on the LLC’s profits.

Members of an LLC are not personally responsible for the obligations of the firm, including debts from the majority of litigation brought against the corporation. The majority of people form LLCs for their businesses primarily because of this asset protection provision of Illinois LLCs. Limited liability is also available through corporations, although the LLC is less formal.

In order to create an LLC in Illinois, you must submit your articles of incorporation to the Secretary of State and pay a registration fee. As well as annual costs for an Illinois LLC . This costs less than a limited liability partnership (LLP), but is about equivalent to a corporation and a limited partnership.
The registration fee for a Series LLC, which permits multiple unique organizations under one umbrella LLC, is another option available in Illinois.

There are three levels of management in a corporation: shareholders, a board of directors, and officials. In Illinois, an LLC may be managed by one or more of its members, or the members may choose managers to oversee daily operations.

A corporation is required to hold board meetings, yearly shareholder meetings, and to maintain minutes of all board meetings. An LLC’s members are not required to hold meetings or keep records of them.

The number of members in an LLC is unconstrained. There cannot be more than 100 members of a S corporation. A C corporation can have more members, but doing so will result in double taxation for the company as well as more regulation regarding its operations.

Does this sound too complicated?

I am so excited to announce that we have a “How to form an LLC in Illinois Guide” where we can help you through this process step by step.

Just click here to get started

Yours in business,

Jeanetta Cardine

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