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What are the legal requirements for starting a small business in Illinois?

Picture of Chris Battis By   ·  1 minute read

To start a small business in Illinois, there are a few legal requirements that need to be followed:

  1. Choose a business structure: The first step in starting a small business in Illinois is to decide on a business structure. The most common business structures are sole proprietorship, partnership, limited liability company (LLC), and corporation. Each business structure has different legal requirements, tax implications, and liability issues, so it is important to choose the one that best fits the needs of your business.
  2. Register your business name: If you plan on using a fictitious name for your business, you must register it with the Illinois Secretary of State's office. This will ensure that the name is not already in use and will protect your business from others trying to use the same name.
  3. Obtain necessary licenses: Depending on the type of business you are starting, you may need to obtain certain licenses or permits from state or local government agencies. The Illinois Department of Commerce and Economic Opportunity is a good place to start when researching which licenses and permits are required for your business.
  4. Obtain an Employer Identification Number (EIN): If you plan on hiring employees, you will need to obtain an EIN from the Internal Revenue Service (IRS). This number is used to identify your business for tax purposes.
  5. Register with the Illinois Department of Revenue: If your business will be selling goods or services subject to Illinois sales tax, you will need to register with the Illinois Department of Revenue and obtain a sales tax permit.
  6. Comply with employment laws: As an employer, you will need to comply with federal and state laws governing employment practices, including minimum wage and overtime laws, anti-discrimination laws, and workplace safety regulations.

It is important to note that there may be additional legal requirements depending on the type of business you are starting. It is recommended that you consult with a licensed attorney or a business advisor to ensure that all legal requirements are met.

In addition, it is important to maintain accurate financial records and comply with all tax laws and regulations. Failure to do so can result in penalties and legal action against your business.