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Starting a Business in Illinois

A complete step-by-step guide to start your business and get on the fast track to financial success.

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Doing Business In Illinois

Business facts:

Manufacturing in Illinois accounts for 14% of the state’s total output and generates $101 billion in economic activity. Illinois’s manufacturing sector grew out of its agricultural production. 

The diversified nature of its economy—strength in manufacturing, agriculture, finance, mining, transportation, government, technology, and services (including tourism)—makes Illinois a microcosm of the national economy. This diversity generally provides greater stability at times when other states with more narrowly based industries suffer.

Small business and startup environment

Illinois has 1,001,185 small businesses, according to the most current federal data available. Of those 1,001,185 small businesses in Illinois, 280,373 have employees. The remaining 720,812 are Illinois small businesses that have no employees.

Illinois Entrepreneurship functions as a portal of entrepreneurial opportunities at the University of Illinois. The University has a vibrant and rapidly evolving entrepreneurial ecosystem, and there are many partners across campus that work together to provide support and resources to the entrepreneurial community.

Prominent resident entrepreneurs who’ve stuck with Chicago include Rahal, who sold his protein-bar startup RxBar to Kellogg’s in 2016 for $600 million, and the co-founders of the digital coupon site Groupon, which went public in 2014, raising $192.5 million. Two of Groupon’s three co-founders, Eric Lefkofsky and Brad Keywell, have new Chicago-based projects: Lefkofskylaunched Tempus, a medical data company that also has a library of clinical and molecular data, and Keywell started Uptake, a predictive analytics software maker for clients in the mining, aviation, rail, energy, retail, and construction industries. 

Major companies

Illinois is home to 12 Fortune 500 companies, including Boeing, Conagra Brands, and Motorola Solutions. Here are other Fortune 500 companies in Illinois: 

Walgreens Boots Alliance, State Farm Insurance Cos., Archer Daniels Midland, Caterpillar, Allstate, United Continental Holdings, Exelon, Deere, AbbVie, Abbott Laboratories, Mondelez International

STEPS TO STARTING A BUSINESS IN Illinois

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Step 1: Choose A Business Structure

The most common business structures are sole proprietorship, partnership, limited liability company (LLC), and a few different types of corporations—the standard corporation (often called a C corporation or “C corp”), the small business corporation (often called an S corporation or “S corp”), and the benefit corporation (often called a B corporation or “B corp”).

The most common business structures are:

Step 2: Choose The Right Business Name

Choosing a business name is important, you want to make it easier for your customers to remember it, here are some tips:

  1. Avoid hard-to-spell names.
  2. Don’t pick a name that could be limiting as your business grows.
  3. Conduct a thorough Internet search.
  4. Search and purchase a domain name.
  5. Use a name that conveys some meaning.
  6. Conduct a trademark search.

Step 3: Register Your Business

Depending on the business structure you chose you will need to register your business.

Illinois Resale license 

Illinois Business Entity Search

Step 4: Obtain an EIN Tax Number

With limited exceptions, most businesses require an Employer Identification Number (EIN), also known as a Tax ID Number. An EIN is used to identify a business in its federal tax filings. Without an EIN, you can’t hire employees or open a business bank account.

Click Here to Apply for EIN number online

Step 5: Open A Bank Account

– Open a business bank account:

  • Separates your personal assets from your company’s assets, which is necessary for personal asset protection.
  • Makes accounting and tax filing easier.

– Get a business credit card:

  • Helps you separate personal and business expenses.
  • Builds your company’s credit history, which can be useful to raise capital later on.

Step 6: Licenses & Permits

Now that you’ve registered your business name you need to obtain a business license for your company – this authorizes your company to do business in your city or county. Typically this also involves registering for state taxes and permits (the city may require them as part of the business licensing process).

Here are some links for Illinois Businesses:

Selling products? Check Illinois Resale Permit

Business Licensing for the State of Illinois

Step 7: Branding & Marketing

Your brand is the image customers have of your business, so it’s important to determine who is your audience and what is the message that you want to project. That way, your company’s image will be what you intend it to be. It should be strategic and intentional.

Step 8: Establish a Web Presence

Creating an optimized website helps you to gain important visibility for the right terms. A website is a powerful sales tool and one that allows you to address your customers’ concerns, give them the information they need to make a decision and create compelling calls to action.

In addition to a website, you should also consider other avenues for promoting your business online:

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