A Limited Liability Company is a business structure that separates your assets and company liabilities. It is the easiest business structure for first-time business owners. It has fewer regulations and reporting requirements, and the income of the owners is taxed only once at the personal income level. It is a hybrid of corporation and partnership business structures as the exemption of double taxation is similar to that of partnerships and the limited liability of the owner, which is similar to that of a corporation.

Forming an LLC is simple as long as you know the necessary and essential steps. Take note that the cost and requirements to form an LLC will always depend on the state. For example, Illinois LLC cost is different from the LLC cost from other states like Georgia, Texas and Utah.

Following are the five easy steps to start an LLC in Illinois:

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Step 1: Business Name

Your business name is a very important aspect when it comes to identifying your brand. When it comes to naming a company, you should stick to something catchy and memorable, and is commendable by Illinois.

There are two important criteria when it comes to naming your LLC: first, the name should be unique, second, the business name must have LLC designation at the end.

Step 2: Appoint a Registered Agent in Illinois

An agent will be the one who will receive the legal paperwork of the business from the state. The agent can be a business entity or a person and must have a registered address located in Illinois. There are two ways you can decide upon the registered agent. Either you can act as the registered agent or find an outsider to act as an agent as there are a lot of available and legitimate agents online you can check out.

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Step 3: File Illinois Articles of Organization

After completing steps 1 and 2, then it will be the time to officially register the LLC with the Illinois Secretary of State. The form is called Limited Liability Company Act Articles of Organization and it can be filled online through the Secretary of State website. The form will require the following information such as the official name of the LLC, place of business, the effective date of the LLC, registered agent’s name and operating address, the purpose of the LLC, name and business addresses of the managers, and signature of the organizers.

Step 4: Operating Agreement

Even though the state of Illinois does not require filing an Operating Agreement, it would be wise to have one to protect the stake of all who are involved in the LLC. Having an operating agreement will not subject it to the state default rules in case of any injury or damage to the company.

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Step 5: Apply for an Employer Identification Number

Creating an EIN (Employer Identification Number) will allow you to effectively handle taxes, do business with outside contractors, and hire and pay employees. It will also allow you to apply for business bank accounts, business loans, and grants.

To make it easier, you can consult experts who can help you form an LLC in Illinois. Also make sure that all requirements are prepared beforehand so that launching your business will be done as soon as possible.