What type of entity is right for your Illinois Startup?

Choosing the right company structure for your new business

Ready to own your own Illinois startup? ClickAndInc.com makes forming your new business in Illinois fast, hassle-free, and affordable. Our incorporation services cost a fraction of what you’d pay a corporate attorney for the same filings. The first step in the process is to select your business type. Read on—we’ve put together information on several different entity types for you so that you can make an informed decision.

Illinois C Corporation

To incorporate in Illinois, you’ll start by filing Articles of Incorporation. This document will list key information about your business—your corporate name, the contact person for the corporation, your location in Illinois—and will be a matter of public record, on file with the Secretary of State’s office and searchable in their office’s database.

A C corporation is the default type of corporation. Many people enjoy the flexibility of a C corporation, such as the ability to issue multiple classes of shares, and the ability to own and be owned by other entities or non-US citizens. C corporations can also have unlimited shareholders. Corporate income will be reported by the corporation, and will be separate from the owners’ individual income taxes.

Learn more about forming and maintaining an Illinois C Corporation.

Illinois S Corporation

An S corporation is a corporation that files Articles of Incorporation with the state, just as in a C corporation, and then files paperwork with the IRS to gain the S status.

While an S corporation has a few more limitations than a C corporation—no more than 100 shareholders, owners must be US citizens, only one class of stock—the “S” status means that the owners pay corporate income tax themselves, thus avoiding what is known as the “double-taxation” of a C corporation.

If you’re not sure if this is the type of entity for you, take a look at further information about forming an Illinois S Corporation.

Illinois LLC

LLCs (or Limited Liability Companies), like S corporations, are pass-through entities as far as tax purposes, which means that owners claim corporate gains or losses on their individual tax returns. Like a C corporation, they can have unlimited members and can be owned by US citizens, non-citizens, and other business entities.

For further information, please take a look at our section on forming an Illinois LLC.

Illinois Foreign Corporation

If you’ve formed a corporation somewhere other than Illinois (your home state is called your domestic state) and you plan to do business in Illinois, you can form a foreign corporation. A foreign corporation is formed in much the same way—by filling out formation documents and submitting them to the Secretary of State of Illinois. A Certificate of Good Standing or Existence from your domestic state is required to be attached to these formation documents when you submit them for filing.

When you set up your Illinois Foreign Corporation with ClickAndInc.com, we will take care of obtaining your Certificate of Good Standing for you.

Illinois DBA

In Illinois, the jurisdiction involved with registering your business depends on your structure. If you are an individual or an unincorporated partnership, your DBA—called an Assumed Name in Illinois—is filed with the County Clerk of the county in which your business is located. You will need a physical address in this business in order to file. Once you’ve done so, you are required to publish notice of your filing in a newspaper of general circulation in your county. When you work with ClickAndInc.com, you have the option to do this yourself, or to have us take care of publication for you.

If you have an existing corporation, LLC, or other incorporated entity, your Assumed Name is filed at the state level, affecting your corporate records with the Secretary of State.

Take a look at our Illinois DBA page for more information.

Illinois Nonprofit Corporation

When you form a Nonprofit Corporation, you do so at the state level just as you would file For-Profit Articles of Incorporation at the state level. Once you’ve registered as a Nonprofit Corporation and have legal status, you can apply for your 501c3 status (or other status) with the IRS. It’s important that the IRS-required 501c3 language is included in the state Articles—the state doesn’t require the language upon filing, but the IRS will need it later. When you form a 501c3 Nonprofit Corporation through Click and Inc, we make sure the requisite 501c3 language is present from the very beginning.

Take a look at our Illinois Nonprofit Corporation page for more information.

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