Starting a New Business in Illinois
Illinois, specifically the Chicago land area, is growing quickly and has a dynamic, pro-business environment. Business friendliness, coupled with the fast paced lifestyle, strategic location, relatively low cost of doing business, and healthy economic growth makes Illinois a great state to start a new business.
Selecting the appropriate form of business entity is not only the threshold step in the business development process but it also has a far reaching impact on the business owner or entrepreneur.
The Various Forms In Which Business May Be Conducted
The initial decision entrepreneurs, professionals face when starting a new business in Illinois, is the selection of the business entity in which the small business is to be operated. This decision is most often influenced by factors related to business tax planning. However, there are many non-tax considerations that affect the selection of the legal entity.
Types of Illinois Business Entities
- General Partnership
- Limited Partnership
- Limited Liability Partnership
- Limited Liability Company
- Statutory Close Corporation
- Professional Service Corporation
- Medical Corporation
- Non-Profit Corporation
- Low-Profit Limited Liability Company
The selection of the form of business entity will have a variety of consequences during the life of the business. For example, it may affect whether the business owner will be liable for the obligations of the business; it may influence what assets the business owner will transfer to the business; and it will determine to a great extent whether the business will continue to operate after the business owner has ceased to participate in it. It is therefore necessary to consider both the short-term and long-term goals of the business, and the nature of the business itself, in order to determine the form of legal entity best suited for the operation of any given business.
Start-up businesses may be conducted as a sole proprietorship, a general or limited partnership, a joint venture, in a corporate form, in one of several forms of special business structures, such as professional corporation, or as a limited liability company.
There is no one form of business entity that fits all businesses. Whether new business owners should use partnerships, corporations, or limited liability companies (or other forms of organization) in the operation of their businesses depends on various factors. Below is a sample listing of the more popular business forms available in Illinois.