LLC in Illinois for Non-Residents (2025 Guide): High Fees, Low Value?
Chicago is a global business hub, but does that make Illinois a good place to form an LLC? We analyze the high filing fees and Series LLC complexity.
Table of Contents
Table of Contents
Author's Bio: The Foreign Founder Team helps international entrepreneurs navigate the US state system. Illinois is a common "trap state" that looks attractive because of Chicago but offers little value for remote founders.
Illinois is the economic engine of the Midwest. If you are shipping physical goods through the Great Lakes or opening a consulting firm in Chicago, it is a great place to be.
But for a remote non-resident entrepreneur, Illinois is a confusing mix of high fees and "Series LLC" complexity that you probably don't need.
In this guide, we will explain why Illinois is usually a "pass" for international founders compared to Wyoming or Delaware.
Is Illinois Right for You? (Decision Tree)
The "Series LLC" Confusion
Illinois is one of the few states that pioneered the Series LLC.
- What it is: A "parent" LLC that can have unlimited "child" cells (Series). Each series has its own assets and liability protection.
- Why it sounds good: Real estate investors love it. You can put Property A in Series 1 and Property B in Series 2, all under one filing.
- Why you should avoid it: It is legally complex, banking is a nightmare (banks hate opening accounts for "Series 3 of XYZ LLC"), and it costs $400 to file instead of $150.
Stick to a standard LLC unless you have a very specific legal reason not to.
Cost Breakdown: Not the Worst, Not the Best
Illinois used to have a $500 filing fee (very expensive). They lowered it to $150 to be more competitive, but it's still pricier than the budget states.
| Expense | Cost | Frequency | Notes |
|---|---|---|---|
| State Filing Fee | $150 | One-time | Standard LLC. ($400 for Series LLC). |
| Registered Agent | ~$50 - $150 | Annually | Required. |
| Annual Report Fee | $75 | Annually | Due before the first day of your anniversary month. |
| Replacement Tax | 1.5% | Annually | A special tax on net income for LLCs. |
The "Replacement Tax" Surprise
Most states just tax income. Illinois adds a 1.5% Personal Property Replacement Tax on net income for partnerships (LLCs).
- If your LLC makes $100,000 profit.
- You pay this 1.5% tax to the state ($1,500) BEFORE you even get to your personal income tax.
- Wyoming/Florida/Texas/Nevada do NOT have this tax.
Privacy and Anonymity
Illinois is not a privacy state.
- Articles of Organization: Must list the names and addresses of managers or members with "authority of manager."
- Public Search: The Illinois Secretary of State website ("CyberDrive Illinois") allows anyone to search your company and see these names.
Summary
Illinois is a "Middle of the Road" state. It's not as expensive as California ($800) or New York ($1,200+), but it's not as cheap or private as Wyoming/New Mexico.
The Bottom Line:
- If you are doing business IN Illinois: File in Illinois.
- If you are a non-resident doing business online: File in Wyoming. You will save money on filing fees, annual reports, and avoid the 1.5% extra tax.
Fact Checked & Verified
This article was reviewed by our editorial team for accuracy. Strategies regarding LLC formation and credit building are based on current 2025 regulations.