● Illinois · Incorporation
How to Incorporate in Illinois
Incorporate in Illinois with the franchise tax handled right – CountSure files your Articles, structures your paid-in capital to keep the franchise tax low, and tracks your annual report. Franchise tax still applies – but the $10,000 exemption zeroes it out for most.
Requirements, costs & steps to incorporate in Illinois
The short answer: To incorporate in Illinois you file Articles of Incorporation with the Secretary of State for $150 plus an initial franchise tax on paid-in capital (0.1%, $25 minimum), appoint a registered agent, and set your authorized stock. Corporations then file a $75 annual report each year – together with the annual franchise tax – due within the 60 days before the first day of the anniversary month. Illinois’s combined corporate income tax is 9.5%. Note: as of 2025 the first $10,000 of annual franchise-tax liability is exempt, so many small corporations owe $0 franchise tax.
You can verify the fees from official website of Illinois – Click here to verify
● Key takeaways
What you need to know?
- Filing fee: $150 for Articles of Incorporation, plus an initial franchise tax on paid-in capital (0.1%, $25 minimum).
- Franchise tax - still in effect: Illinois still levies a franchise tax on paid-in capital. The 2019 law that would have repealed it in 2024 was reversed in 2021 - but as of 2025 the first $10,000 of annual liability is EXEMPT, so most small corporations pay $0.
- Annual report + franchise tax: $75 report, filed with the annual franchise tax, due within the 60 days before your anniversary month.
- High corporate tax: Illinois’s combined corporate rate is 9.5% (7% income tax + 2.5% replacement tax) - among the highest in the US.
- Directors: At least one director; director and officer names ARE reported on the annual report.
Illinois corporation at a glance
| Requirement | Detail (2026) |
|---|---|
| Formation document | Articles of Incorporation (Form BCA 2.10) |
| Filing agency | Illinois Secretary of State, Dept. of Business Services |
| State filing fee | $150 + initial franchise tax (0.1%, $25 min) |
| Franchise tax | On paid-in capital; first $10,000/yr liability exempt (2025) |
| Registered agent | Required; physical Illinois address (no PO box) |
| Directors | Min. 1; reported on the annual report |
| Bylaws | Required (internal; not filed) |
| Annual report | $75 + annual franchise tax, before anniversary month |
| Corporate income tax | 9.5% combined (7% + 2.5% replacement tax) |
| S-corp election | Recognized (federal election honored) |
● Step by step
How to incorporate in Illinois, step by step
Choose a compliant corporate name
Appoint a registered agent
Set your paid-in capital and authorized shares
File Articles of Incorporation
Adopt bylaws and hold an organizational meeting
Get an EIN and register for taxes
Calendar your annual report and franchise tax
● Directors & documents
Director & formation requirements
- Minimum number: At least one director.
- Residency / age: No Illinois residency requirement; directors must be at least 18.
- Listed in Articles: Director names are not required in the Articles of Incorporation, but directors and officers ARE listed on each annual report.
- Bylaws: Illinois corporations must adopt bylaws (kept internally, not filed with the state).
- Stock: Authorized shares and the paid-in capital drive the franchise tax - set them deliberately.
Ongoing Illinois corporation compliance & taxes
Corporate records
Annual report and franchise tax
Corporate income tax - 9.5% combined
S corporation election
EIN and state tax ID
Illinois incorporation cost breakdown
The full picture before optional services.
| Item | Cost (2026) · paid to |
|---|---|
| Articles of Incorporation | $150 · Secretary of State (one-time) |
| Initial franchise tax | 0.1% of paid-in capital ($25 min) · Secretary of State, at filing |
| Annual report | $75 / year · Secretary of State, before anniversary month |
| Annual franchise tax | 0.1% of paid-in capital · with annual report (first $10,000/yr exempt) |
| Expedited processing (optional) | ~$100 · ~1 business day |
| Name reservation (optional) | $25 · 90-day hold |
| Registered agent (optional service) | ~$49–$300/yr · third party |
| EIN | $0 · IRS (free) |
● Expert view
Insight from our team
“The Illinois franchise tax is the thing everyone gets wrong – half the guides online still say it was repealed in 2024. It wasn’t; that repeal was itself repealed in 2021, so the tax is very much alive. The saving grace is the exemption: since 2025 the first ten thousand dollars of franchise-tax liability is exempt, which means most of my small-corporation clients actually owe zero. But it’s tied to paid-in capital, so if you’re authorizing and issuing a lot of stock, we model it up front. And remember the combined income tax is 9.5% – for a profitable C-corp, that’s the number that really matters, not the franchise tax.”
Parth Shah
CountSure
● Keep exploring
Related guides & services
- All state formation guides
Illinois incorporation Questions
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