As an entrepreneur in Illinois, you know that taking care of all the legal and administrative aspects of your business is often time-consuming. Along with bringing in clients and creating invoices, you also need to make sure you pay taxes and register your business properly with state and federal governments. Illinois recognizes several different types of business structures. Understanding the basics of each option may help you choose the right structure for your unique situation.
The Illinois Department of Commerce provides information to help entrepreneurs organize their businesses. In Illinois, you may organize your business as a sole proprietorship, partnership, corporation or more. Each type has unique advantages. If you do not have any employees, you may want to operate as a sole proprietorship. In this case, your business name is technically the same as your full legal name. The Assumed Name Act allows you to register a different business name with your local county clerk.
You may want to organize as a limited partnership or limited liability company. Both LLP and LLC structures allow you to separate your business debts and liability from your own personal finances. You may operate an LLC in most industries except insurance and banking.
Registering your business as a C Corporation is another option. This is a fairly complex legal distinction that may allow you to sell stock and operate under a board of directors. This structure limits shareholders’ liability and makes it easier to transfer ownership. An S Corporation structure may allow your business to seek a limited number of shareholders. However, you must go through the Internal Revenue Service rather than the state government to select this option.
This information about business structures in Illinois is intended for educational purposes and should not be interpreted as legal advice.