Thursday, November 27, 2014

How To Create Illinois LLC Formation

By Ida Dorsey

LLC is the abbreviation for "Limited Liability Company", a certain, flexible business structure. First of all, it is important to clarify what Illinois llC formation is. As the name suggests LLCs offer limited liability to their members. In LLCs can be corporations, partnerships or single-member companies.

What follows is necessary for the formation of an LLC: the full names and addresses of: the company's principal and the registered agent; the purpose of the LLC; the type of management; the full name, address and signature of the organizer; the member's liability, and the exact period the LLC is not perpetual.

The next stage is to name your LLC. The purpose of a company's name is to make it stand out from the pack - that is why it has to be unique. In order to achieve that consult the Secretary of State Business. After some research you will find out if your company's name is similar to another's. If that is the case, act accordingly and change it. The name of your LLC must and can only be followed by the abbreviation LLC, L. L. C. Or the full designation "Limited Liability Company".

After naming your LLC you should consider hiring a registered agent. Though not mandatory, it is highly recommended. Your LLC's legal agent may be an individual or another company authorized to carry out business permanently based in Illinois. A registered agent's primary tasks involve accepting legal documents for the LLC and brief its members.

What follows is the acquiring of an Employer identification Number, abbreviated EIN. EIN is necessary for LLC that have two members or more since it is used for tax purposed. The IRS is responsible for issuing the EIN. Make sure you register with the Illinois Department of Revenue either by filling a form online or by sending an e-mail in the respective address.

Then you have to generate an operating agreement, which states who the owner of the LLC is and what operating procedures are followed. It is a very important document since the State of Illinois recognizes it as the one governing the LLC. Though not mandatory, you are advised to create an operating agreement especially if your LLC has more than a single member. Get in touch with a lawyer to create your LLC's operating agreement.

One other document you should focus on is the annual report. Your LLC is legally obliged to provide the State of Illinois with these reports each year before the anniversary of your LLC's founding, either online or by mail. The filling of the annual reports can be carried out either by the manager or a member of the LLC and comes at a cost of $250. Since the fees are susceptible to changes refer to the State Department of Business Services for further information. Bear in mind though that should you fill the annual reports later than expected you will be penalized with a fee of $300.

The State's website also provides information on types of taxation. LLCs are of course subject to federal income tax, the amount of which depends on the type of taxation you will choose. Visit the website, get informed and conclude on what suits you best.

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