Legal Requirements for Starting a Business in Illinois

Starting a business in Illinois requires compliance with various legal requirements. Here are the legal requirements for starting a business in Illinois:

1. Choose a Business Structure

Selecting a business structure is the first and foremost requirement when starting a business. An entrepreneur can select any of the following business structures:

• Sole Proprietorship: A business that is owned and operated by a single individual.
• Partnership: A business owned and operated by two or more individuals.
• Corporation: A legal entity that is separate from its owners.
• Limited Liability Company (LLC): A hybrid business structure that provides the limited liability of a corporation with the tax benefits of a partnership or sole proprietorship.

2. Registering the Business

In Illinois, a business owner must register their business with the Illinois Secretary of State. The registration process requires the submission of various documents, including:

• Articles of Incorporation or Articles of Organization (depending on the business structure)
• Business Name Reservation
• Business License (if required)
• Employer Identification Number (EIN) from the Internal Revenue Service
• State and Local Tax IDs
• Certificate of Good Standing (if transferring an existing business to Illinois)

3. Obtaining Licenses and Permits

Certain businesses require special licenses and permits to operate in Illinois. Some of the businesses that require licenses and permits are:

• Food Service Businesses
• Hairdressers and Barbers
• Liquor Sellers
• Real Estate Agents
• Plumbers and Electricians

4. Tax Obligations

A business in Illinois must comply with various tax obligations, including:

• Illinois Sales Tax
• Illinois Income Tax
• Federal Income Tax
• State Unemployment Insurance Tax

5. Compliance with Regulations

A business must comply with various federal, state, and local regulations, including:

• Occupational Safety and Health Administration (OSHA) regulations
• Environmental Protection Agency (EPA) regulations
• Equal Employment Opportunity Commission (EEOC) regulations
• Americans with Disabilities Act (ADA) regulations

Limitations and Exceptions: The legal requirements for starting a business in Illinois can vary depending on the type of business and the location. For example, some municipalities may require additional permits or licenses.

Further Action: Entrepreneurs in Illinois can seek legal advice from licensed attorneys or consult with the Illinois Department of Commerce and Economic Opportunity for assistance with starting a business.