Payment of state and federal LLC taxes
Forms you need to submit for federal income tax purposes It depends on the company structure.
Traditional LLC In other words, you don't pay taxes on your income, you just pay taxes on your income. report Report their income to the IRS.
Single Member LLC is treated as a sole proprietorship and reports the LLC's income on its members' individual income tax returns (Form 1040).
Multi-member LLC This means that the LLC will report its income using Form 1065, and each member will use Schedule K-1 to claim their share of the income from the LLC.
Select S-Corp Treatment LLC First, you need to tell the IRS that you want your LLC to be taxed as a small business corporation by filing Form 2553. Like a traditional LLC, an S-Corp is a pass-through entity, so the company's income only needs to be reported using Form 1120-S. Each member/employee then pays taxes on the salary paid by the LLC.
Select C-Corp treatment LLC First, you need to tell the IRS that you want your LLC to be treated as a corporation for tax purposes by filing Form 8832. Unlike other legal entities, this election will trigger a double taxation structure (once at the corporate level and once at the shareholder level).
in state level, you must pay personal property replacement tax equal to 1.5% of the LLC's net income. Additional taxes vary depending on the business your LLC conducts. Illinois counties may also impose additional state taxes on your activities.
employment of employees
If you are considering hiring employees in your LLC, Illinois has additional requirements that you must comply with to maintain good relations with the state, including:
LLC marketing
Building a customer/client base is very important if you want to get your business off the ground. That's why it's a good idea to invest in marketing your LLC. Illinois business owners can start by building their company's online presence.
The first step is to see if you can use something similar to your LLC's name as a domain name. It is best to choose an address that is relevant to your business, short, catchy, easy to remember and user-friendly (especially for mobile users).
For example, the law firm Skadden, Arps, Slate, Meagher & Flom LLP uses the domain skadden.com. You might also consider using your company's initials (“sasmf.com”) or a phrase related to your business (“chicagobusinesslawyers.com”).
You can also use a descriptive name that is different from your registered LLC name. This is called a “doing business as” (DBA) name, or “Assumed Name,” and can be useful if his registered LLC name is very technical or difficult for consumers to remember. To make this pseudonym official, a form must be filed with the Illinois Secretary of State.
inside scoop: Even if you're not ready to build a business website, reserve your desired domain name today. It's cheap and easy to do yourself, and it can save you a lot of trouble in the future if you realize you missed an opportunity.
If you're not ready to build a website yet, you can always start by creating a free social media account (Instagram or Facebook). This is an increasingly popular way to grow your following and get users to interact with your products and services.
Applying for and registering an LLC business license
To do business in Illinois, an LLC must first register with the Illinois Department of Revenue. If you sell certain products, such as alcohol, tobacco products, or gasoline, you may be required to provide additional documentation.
Depending on your LLC's industry, the Illinois Department of Business Services and certain local government offices may also require you to obtain a business license. For example, if your LLC is in a professional industry such as real estate, dentistry, or law, each member must obtain a permit or LLC license from the appropriate state licensing department before they can begin business operations.
Many cities and towns, including the City of Chicago, have their own additional business licensing rules and LLC requirements. Businesses in certain industries, such as alcohol and cannabis sales, are also required to obtain specific sales licenses and certifications before operating.
local resources
The process of forming an LLC in Illinois can seem like a minefield. There are many things to consider. How do you know what you don't know? A good solution is to find a business mentor who can help you find your way. The SCORE Mentorship organization has chapters throughout Illinois to connect you with mentors in your area and industry.
You can also become a member of your local chapter of the U.S. Small Business Administration. This will give you a little more guidance when it comes to understanding everything you need to do to comply with state and federal laws. It also connects you to many other resources, including financing options, educational opportunities, and local small business initiatives.
