What is an Illinois Corporation?
Illinois Corporation or Illinois INC, is a business formation registered with the Illinois Secretary of State. The Illinois Corporation will be able to issue shares of stocks to employees and investors, unlike an LLC in Illinois.
Illinois Corporation Requirements
- State Filing Fee of $150.
- A Registered Agent located in Illinois. See our service here.
- Articles of Incorporation.
- Beneficial Ownership Information Report filing. Your report must be submitted after company formation starting January 1, 2024.
Illinois Corporation Structure
IL Corporations are structured legally with the Illinois Articles of Incorporation. Like many states, the document for a Corporation formation is short and simple.
The required information to be listed:
- The Illinois Corporation Name
- Registered Agent
Illinois Corporation Name
The exact name of the Illinois Corporation is to be listed with one of the following words in the name title: “Corporation”, “Company”, “Incorporated”, “Limited” or an abbreviation of the preceding.
The initial Registered Agent’s name and address is required information.
Multiple types of shares of stock are allowed with an Illinois Corporation. You will need to list the class, number of shares authorized, number of shares proposed to be issued and value.
The number of Directors constituting the initial board of directors is to be listed along with the names and addresses.
You will be asked to estimate values for the following year for your Corporation. The following are the estimates:
- Value of Property
- Value of Property in IL
- Gross Amount of Business
- Gross Amount of Business in IL
Names and addresses are required from all Incorporators that are filing the Corporation.
|Illinois Incorporation Facts|
|The Filing||Articles of Incorporation|
|The Agency||Secretary of State Dept of Business Services|
|The Paper Filing Fee||$175 (minimum)|
|The Online Filing Fee||$281.25 (includes $100 expedite & $6.25 processing fee)|
|Our Fee||$320 (includes registered agent service)|
|Annual Report Due Date||Day Before Anniversary Month|
|Franchise Tax Fee||$25 (minimum)|
How to File an Illinois Corporation
Steps in forming an Illinois Corporation:
Decide on a Corporate Name: The Illinois Business Corporations Act of 1983 (805 ILCS 5/4.05) lays out the requirements for a corporate name. All names must be distinguishable from other names already on file with the Secretary of State.
- File Articles of Incorporation: To form a corporation, Articles of Incorporation must be filed with the Secretary of State Department of Business Services. The DBS charges a $150 filing fee.
- Pay the Franchise Tax: To file an Illinois incorporation, a franchise tax must be paid when filing the Articles of Incorporation. The tax is assessed at $1.50 per $1,000 on the paid-in capital represented in the state. The minimum initial FT is $25.
- Appoint a Registered Agent: To form a corporation, a registered agent and registered office must be designated on the Articles. The registered agent accepts service of process and important business mail on behalf of clients.
- Draft Corporate Bylaws: A critical step of an Illinois incorporation is drafting the corporate bylaws. Bylaws outline the ownership of the corporation and govern the management and operation of the company. Bylaws are an internal document.
- Establish Business Accounts: Corporations need business bank accounts to handle monetary transactions. Every bank branch has its own requirements to open accounts. Most banks will require copies of the Articles and corporate bylaws.
- File Annual Report: After the Illinois incorporation is complete, corporations file an AR each year and pay the $75 filing fee. There is an additional FT fee due every year (minimum $25) with the report.
- Submit Beneficial Ownership Information Report: You must a file a BOI report with the Financial Crimes Enforcement Network after formation, starting January 1, 2024. The BOI report is free to file and must be submitted online.
Can I Form a Corporation Online?
Yes. You can file the paperwork through CyberDriveIllinois, but the fee is higher. The Secretary of State automatically expedites all online filings. Expedite will cost an additional $100. There is also an added $6.25 processing fee. The total minimum cost of an online Illinois incorporation is $281.25. This assumes that the initial FT is only $25 (it can be higher).
When filing online, you can only authorize Common Stock. You cannot authorize any Preferred Stock.
What is the Difference Between Authorized Stock and Issued Stock?
When you form a corporation, you must authorize an amount of stock. Authorized shares are the total number of shares created when the company is formed (this can be added to later). But the stock does not belong to anyone until it is issued to shareholders, which happens at the initial shareholders meeting. Once stock has been issued (given) to shareholders, it becomes issued stock. You are not required to issue all the shares of authorized stock. Some can be held in reserve to issue at a later date.
Illinois Registered Agent
An Illinois registered agent must have a physical street address within the state where they can accept service of process and other important business mail for clients. This is called a registered office, and it cannot be a PO box. All documents received for clients must be forwarded onto those clients in a timely manner.
Illinois Corporate Bylaws
Corporate bylaws address ownership and management of corporations. They should address, at the very least:
- Initial shareholders and their rights and responsibilities
- Directors and officers (President, Secretary, Treasurer)
- Type of stock and any special rights
- How stock can be bought and stold
- Allocation of profits and losses
- Amendment process
- Annual shareholder meeting procedures
Am I Required to Get an EIN for My Corporation?
An Illinois incorporation may require an Employer Identification Number. It depends on whether or not your corporation will have employees or owe federal taxes. If you will have employees, then yes, you must have an EIN. However, if you have no employees, pay no federal taxes, and will not have a Keogh plan (a special retirement plan for self-employed individuals), then there is no reason to have an EIN. The situation of your Illinois Corporation is up to you.
Illinois Corporation Annual Report and Franchise Tax
After you form a corporation, you must file an annual report every year. The report is due the day before the first of your anniversary month. If you incorporated in November, then your report is due by October 31.
Corporations in Illinois pay an annual franchise tax. There is an initial FT due when you file Articles of Incorporation, and then each year with the AR. The FT is $1.50 per $1,000 of the paid-in capital represented in the state, with a minimum tax of $25.
Federal Beneficial Ownership Information Report Filing
Starting January 1, 2024, most newly-formed corporations are required to file a Beneficial Ownership Information (BOI) report with the Financial Crimes Enforcement Network (FinCEN) following company formation. On your report, you’ll need to disclose some basic details about your company and those with the most control over your corporation’s profits and operations. Save yourself from the additional paperwork with our $9 BOI report filing service.
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