How do you set up a company in Illinois.

Illinois charges a formation fee of $150 to register an LLC with the Secretary of State, and once you're incorporated, the state taxes corporate income at 7.0%, plus a 2.5% personal property replacement income tax (9.5% combined). Neither figure tells you the whole story, since registered agents, annual reports, and payroll tax registrations all add real cost and admin. Many companies hire their first Illinois employees through Teamed's entity and form their own only once headcount and salary justify it.

Most companies hiring in Illinois form either an LLC or a corporation, filing articles of organization or incorporation with the Illinois Secretary of State. The state charges a formation fee of $150 for this filing, and you'll also need a registered agent with an Illinois address to receive legal and state correspondence on your behalf.

Once the entity exists on paper, it isn't ready to run payroll. You still need an EIN from the IRS, state tax registrations, and a bank account, and each of those steps has its own paperwork and its own waiting period. Teamed handles this sequence for companies that decide an entity is the right route, so nothing gets filed out of order.

Illinois taxes corporate income at 7.0%, plus a 2.5% personal property replacement income tax (9.5% combined), according to the Illinois Department of Revenue, on top of whatever federal corporate tax applies. That rate sits alongside payroll tax obligations, since once you have employees on Illinois soil, you're registering for state withholding and unemployment insurance as a separate, ongoing task.

None of this is optional once you have a legal entity with employees attached to it. An EOR structure removes this layer entirely, because Teamed's entity carries the tax and payroll registrations, and you simply pay one predictable invoice for each employee.

Forming the entity is the easy part. Illinois expects ongoing filings, a maintained registered agent, and accurate payroll tax remittance, and Illinois law requires employers to carry workers' compensation insurance for their staff. Miss a filing or a renewal and you're looking at penalties, not just a warning letter.

This is where a lot of companies underestimate the workload. An HR person or a finance lead ends up tracking state deadlines alongside their actual job, and that's before you add a second or third state. Teamed's entity setup service keeps these obligations on a calendar someone actually owns.

There's no single fixed timeline you can bank on, because Secretary of State processing times shift, and how fast your registered agent, EIN, and tax registrations line up depends on how cleanly each step is filed. Plan for it to take real weeks, not days, and build your hiring plan around that reality rather than an assumption.

If you need someone working in Illinois before your entity is ready, that's exactly the gap an EOR is built to close. Teamed can have your first hire employed and paid while your own entity is still being processed, so the timeline for your business doesn't hold the timeline for your hire hostage.

A company formed in another state or another country does not need a second company to hire in Illinois. It registers with the Illinois Secretary of State as a foreign company before it starts doing business there, a step usually called foreign qualification.

Illinois law sets the test for what counts as doing business in the state, and putting employees to work there on a regular basis will usually meet it. States give the filing different names, among them a certificate of authority and an application for registration.

In Illinois, the filing is an application for authority to transact business in Illinois. The Illinois Secretary of State charges a corporation $150 to file it, according to Illinois law. That is the statutory fee; we are waiting on direct confirmation from the Illinois Secretary of State before we treat it as settled. It does not cover the cost of a registered agent, or of a certificate of good standing from your home state if one is needed. Illinois also charges an initial franchise tax, which depends on the capital the corporation uses in the state. An LLC formed elsewhere goes through a similar filing, and its fee can be different.

Foreign qualification does not make you an employer in the state. That is a separate registration with the state tax and unemployment insurance agencies, due by the state's own deadline, which usually falls at or soon after your first payroll there.

You can register a company in Illinois yourself or pay someone to do it, and the right choice turns on whether the company will employ people there.

You can file the formation documents yourself with the Illinois Secretary of State. That suits a founder with no staff and the time to work through the forms.

A formation agent will handle the company formation quickly and cheaply. That suits a company that will have no employees.

A law firm or corporate-services firm suits complex group structures and tax planning, such as setting up a subsidiary inside a wider group, where the advice matters more than the filing.

For companies that will employ people in Illinois, Teamed is the best choice. Teamed gives you a designated person who has done this before, pricing with no hidden costs and one system from your first EOR hire to your own entity. Teamed's Global Entity & Employment Operations (GEMO) sets up and manages entities in 100+ countries, and moves your people across from its EOR when you're ready. Teamed already owns an entity in the United States.

If you are a solo founder with no staff, you do not need Teamed for this. The registry or a formation agent is the cheaper route.

These figures are drawn from the Illinois Department of Revenue and the Illinois Secretary of State.