An Illinois LLC operating agreement helps set clear expectations about what is required from each business partner, including their roles and responsibilities. It will allow you to have more say in how your LLC operates.
The document protects the company’s limited liability status. Without an operating agreement, an Illinois company could be mistaken to be a sole proprietorship or partnership for tax and lawful purposes.
Is an LLC Operating Agreement Required in Illinois?
NO, an LLC operating agreement is not required in Illinois, but having one helps.
The laws governing LLC operating agreements in Illinois are included in the Limited Liability Company Act (805 ILCS 180/):
Costs and Fees
Starting an LLC in Illinois costs the same regardless of whether you’re starting a foreign or domestic LLC:
- Articles of organization filing fee – $150 ($400 for a series LLC).
- Name reservation fee – $25.
- Annual report fee – $75.
How to Form an LLC in Illinois
To register an LLC in Illinois, you’ll need to follow a few simple steps:
Step 1 – Find a Registered Agent
In Illinois, all businesses using the LLC format must have a registered agent – a person or entity that will receive government notices as well as handle service of process for the business.
When choosing a registered agent, businesses have two options. They can either select an Illinois state resident or can choose their agent to be a business that can legally conduct business within the state. The agent must have a physical street address in Illinois.
Step 2 – File Your Registration Documents
To file your registration documents, you’ll need to choose whether you’re starting a domestic LLC or a foreign LLC. Once you’ve chosen the type of LLC you’ll be starting, you’ll need to print out your paper applications. Make sure to print two copies. Then, fill them out and send them to the Illinois Secretary of State.
Remember that if you’re starting a foreign LLC, you must include a certificate of existence with your application. The certificate can’t be older than 60 days and must be hand-signed by a company officer. You can also file your paperwork online.
Step 3 – Pay Your Filing Fee
The filing fee is what allows you to actually receive your business registration and commence operations. You can pay it online, or you can mail it to the Secretary of State of Illinois as a paper check or money order. If you pay online, you’ll get a slight discount.
Step 4 – Set Up Your Operating Agreement
Even though you’re not required to have an LLC operating agreement in Illinois, getting one is a great idea. That way, you can keep your business structure consistent and ensure you’re legally protected in court in the event that things go wrong in your company.
Step 5 – Get an Employer Identification Number (EIN)
Finally, you will need to get an employer identification number, also known as an EIN. This nine-digit number helps the IRS identify your business for tax purposes.
Aside from tax filing, you’ll need this number to hire employees, open a business bank account, take out a loan, or get a business credit card. You can apply for the number on the IRS website.
Download an Illinois LLC operating agreement template below in PDF & Word format.