Breadcrumb

Step by Step Guide

​This guide will inform you of various legal requirements and direct you to additional resources. If you have any questions contact the Business Information Center at 800-252-2923 (TDD: 800-785-6055) or Submit a Question and a staff member will assist you. 

  1. Where Do I Start?
  2. What ownership structure choices do I have?  
  3. Where do I register a business?
  4. What are my responsibilities as an employer?
  5. How do I protect my invention, product or idea?
  6. Where can I go for help?

 


 

 

 

Where Do I Start?

Feasibility Checklist

A feasibility checklist is a tool that is used to evaluate the potential success of a new or existing business opportunity.

Business Plan

A business plan is vital in determining the credibility of a new business opportunity. It can be used as a management tool and may be required if financing is needed. It also demonstrates to prospective investors a well defined course of action.

 


 

What ownership structure choices do I have?

There are several ways to organize businesses in Illinois. They are Sole Proprietorships, General and Limited Partnerships, Limited Liability Partnerships (LLP), Limited Liability Companies (LLC), "S" Corporations and "C" Corporations. Before selecting a business type, consult an attorney or accountant for assistance in determining which one is best for your business. 

Sole Proprietorship and General Partnership

When a business name is different from the owner(s) full legal name(s), the Illinois Assumed Name Act requires sole proprietorships and general partnerships to register with their local county clerk's office for registration under the Assumed Name Act. Sole proprietors must have a Federal Employer Identification Number if they pay wages to one or more employees, or file any pension or excise tax returns including those of alcohol, tobacco or firearms. 

Limited Partnership

A Limited Partnership is an organization made up of a GENERAL PARTNER, who manages a project, and limited partners, who invest money, but have limited liability and are not involved in day-to-day management. Typical limited partnerships are in real estate, oil and gas, and equipment leasing and family partnerships.

    • Limited Partnership Section
      501 South Second Street
      Room 357, Howlett Building
      Springfield, Illinois 62756
      217-785-8960
      TDD: 1-800-252-2904
    • Limited Partnership Section
      17 North State Street
      Room 1137
      Chicago, Illinois 60602
      312-793-2872
      TDD: 1-800-252-2904

Limited Liability Company

A Limited Liability Company (LLC) is the non-corporate form of doing business that provides its owners with limited liability, flow-through tax treatment and operating flexibility through participation in management of the business. The LLC is well suited for every type of business venture, except banking and insurance which are prohibited by Statute. Examples of acceptable businesses are: farming, agricultural services, mining, construction, manufacturing, transportation, wholesale and retail trade, investment companies, insurance agents, real estate brokers, all types of real estate ventures, hotels, personal and business services, automotive sales and services, amusement and recreation, health services, accounting, architecture and other professions, just to name a few.

    • Limited Liability Company Section
      Room 351, Howlett Building
      Springfield, Illinois 62756
      217-524-8008
      TDD: 1-800-252-2904

Limited Liability Partnership

If organized as a Limited Liability Partnership under a specific section of the General Partnership Act, partners are not liable for the debts, obligations and liabilities of, or chargeable to the partnership arising from negligence, wrongful acts, omissions, misconduct or malpractice committed while the partnership is a Limited Liability Partnership.

    • Limited Liability Partnership Section
      Room 357, Howlett Building
      Springfield, Illinois  62756
      217-524-4952
      TDD: 1-800-252-2904

"C" Corporation

A corporation is a distinct legal entity and is the most complex form of organization. A corporation may sell shares of stock, which are certificates indicating ownership, to as many people as is desirable. The shareholders then elect a board of directors, which elects a president and other officers who run the company on a day-to-day basis. Among the advantages of corporate formation are limited liability of the shareholder and ease of transferring ownership. If the name of the business includes the word "Corporation," "Inc.","Incorporated" or "Corp.", then the business must be incorporated.

    • Business ServicesRoom 328 Howlett Building
      Springfield, Illinois 62756
      217-782-6961
      TDD: 1-800-252-2904
    • Business Services
      17 North State St., Room 1137
      Chicago, Illinois 60602
      312-793-3380
      TDD: 1-800-252-2904

"S" Corporation

Electing S Corporation status is an option that must be made through the Internal Revenue Service (IRS) when starting a business. In general, an S Corporation passes through income and expenses to its shareholders, who then report them on their own income tax returns. To qualify for S Corp. status, a corporation must meet several requirements, one of which limits the number of shareholders. Get online or contact:

    • Business Services
      Room 328 Howlett Building
      Springfield, Illinois  62756
      217-782-6961
      TDD: 1-800-252-2904
    • Business Services
      17 North State St., Room 1137
      Chicago, Illinois  60602
      312-793-3380
      TDD: 1-800-252-2904 

Secretary of State Database of registered corporate names


Where do I register a business?

Registering A Business Name

When the business name is different from the owner's full legal name, the "Assumed Name Act" requires you to register the business name with your county clerk's office, regardless to the structure of the business.

Business Tax Registration

Internal Revenue Service (IRS)

The Internal Revenue Service has information such as a checklist for a new business and selecting a business structure. Learn about operating a business with employees, deductions and credits, recordkeeping and accounting methods. Additional resources include the Small Business Tax Calendar, Tax Topics for Businesses, and Frequently Asked Questions. For more information contact:

Illinois Department Of Revenue (IDOR)

In Illinois, most business are required to be registered and/or licensed by the IDOR. If you plan to hire employees, buy or sell products wholesale or retail, or manufacture goods, you must register with the IDOR. To obtain information contact:

Local Tax Registration and Requirements

Some municipalities and counties impose their own taxes in addition to the state and federal taxes that most businesses are responsible for.  New businesses should contact their local revenue department to determine if additional taxes apply to their business activities. Many communities restrict advertising, regulate pricing or require zoning permits. Contact your city or county clerk for information on local restrictions.

Licenses And Permits Required By Law

The Illinois Department of Financial and Professional Regulation (IDFPR) is the main licensing agency for the State of Illinois for most professions. Individuals must be licensed prior to conducting business as one of the listed professions.


What are my responsibilities as an employer?

Unemployment Insurance

Typically a business is required to make unemployment insurance contributions to the Illinois Department of Employment Security (IDES) if they have: 1) employed one or more workers in each of 20 or more calendar weeks; or 2) paid at least $1,500 in total wages during the calendar quarter.  IDES offers a New Employer Packet. To request this packet, contact:

Illinois Department of Financial and Professional Regulation

The Illinois Department of Financial & Professional Regulation (IDFPR) is the main licensing agency for the State of Illinois.  IDFPR provides an on-line database listing every individual licensed with their agency.

Visit the IDFPR web site and click on "License Look-up" to learn if an individual is licensed in a certain profession or determine if a licensed number is valid.

Anti-Discrimination Laws

The Equal Employment Opportunity Commission (EEOC) is responsible for the enforcement of all anti-discrimination laws. These laws include: Title VII of the Civil Rights Act of 1964, Equal Pay Act, Age Discrimination in Employment Act, Rehabilitation Act of 1973, Title I of the Americans with Disabilities Act, and the Civil Rights Act of 1991. Business owners should acquaint themselves with these laws because they affect the company's hiring practices. To order information on these laws, contact:

  • EEOC Publications Office
    PO Box 12549
    Cincinnati, Ohio 45212
    1-800-669-3362
    Fax: 513/489-8692
    TDD: 1-800-800-3302
    Material Orders Only TDD: 1-800-669-6820
    http://eeoc.gov/employers

Workers' Compensation Insurance

Under the Workers' Compensation and Workers' Occupational Diseases Acts, an employer is required to provide insurance for accidental deaths, injuries and occupational diseases of employees arising in the course of employment. Temporary workers who normally do not receive company benefits are still provided workers' compensation. Insurance generally is purchased through private companies. Companies can apply to the Workers' Compensation Commission to become self-insured. To learn more, contact:

Employment Service/Labor Market Information

The Illinois Department of Employment Security can assist you with finding new employees. Find out about labor market conditions and industry projections.

Wage Withholding for Child Support

The Illinois Department of Healthcare and Family  Services is the Child Support Enforcement Agency for the State of Illinois. If you (as an employer) are served a Notice of Withholding, you are required by law to withhold a portion of an employee's income for payment of child support. For a copy of "Ensuring A Child's Birthright: An Illinois Employer's Guide To Income Withholding", contact:

Immigration Reform and Control

The Federal Immigration Reform and Control Act of 1986 requires every employer to keep on file a form for every employee certifying that employee's identity and work eligibility. For further Information contact:

Required Posters for Illinois Employers

The Illinois Department of Labor's website has a listing of State and Federal posters employers are required to display in the workplace. Visit their website at http://www.illinois.gov/idol/EmployerInformation/Pages/posters.aspx for details on how to obtain each poster.


How Do I Protect My invention, product or idea? 

Trademarks, Patents and Copyrights

A trademark, servicemark or tradename is a word, name symbol, device or combination thereof, adopted and used by a manufacturer, service provider or merchant to identify goods and services in order to distinguish them from others. A patent gives legal recognition to the inventor, creator or discoverer of a new product, procedure or composition of matter. You may obtain a patent or federal trademark by fulfilling all the requirements of the U.S. Patent and Trademark Office.  For more information, contact:

State trademarks, servicemarks and tradenames can be obtained through:

  • The Secretary of State
    Business Services
    Trademark Division
    Room 328 Howlett Office Building
    Springfield, Illinois 62756
    217-524-0400

A copyright is a form of protection provided to an author of original works including literary, dramatic, musical, artistic, sound recordings and certain other intellectual works.

 


 

Where can I go for help?

The Illinois Small Business Development Center Network  is made up of Small Business Development Centers (SBDC), Procurement Technical Assistance Centers (PTAC), SBDC - International Trade Centers, Small Business Environmental Assistance Program (SBEAP) and the Business Information Center.  Training courses and free one-on-one business advising are offered through the network.

Small Business Administration (SBA)

The SBA offers educational, financial and training programs, advisory services, and publications free or at a nominal fee. The agency also offers specialized programs for women business owners, minorities, veterans, international trade and rural development. For more information contact the SBA at:

SCORE - Counselors To America's Small Businesses

SCORE and the SBA conduct seminars throughout Illinois on starting and running a business, as well as provide individual counseling.

Business and Industry Data Centers (BIDC)

BIDC affiliates use census information and other economic and demographic data to help small business owners plan, manage and expand their businesses. Demographic information that is available includes the population, including age, race, and sex, income and the labor force in a given area. Accessible economic information includes the number and kinds of businesses, employment, payroll and sales information.  

  • For more information call 217-785-6117

Illinois Small Business Environmental Assistance Program

The Illinois Small Business Environmental Assistance Program provides companies with assistance in determining permit requirements under the Illinois Environmental Protection and Clean Air Acts. This service is non-regulatory and confidential.

Small Business Tax Workshops

The Small Business Tax Workshops are conducted by the Internal Revenue Service, Illinois Department of Revenue, Illinois Department of Employment Security, Social Security Administration and the Small Business Administration. These workshops provide federal and state tax information for new and existing small business owners. For more information contact the local Small Business Coordinator at:

For any questions or concerns regarding your business or the contents of this web page, please contact the Business Information Center at 1-800-252-2923 or Submit a Question.
TDD: 800-785-6055