Erase In Legal Illinois Startup For S-Corporation Forms For Free

An S-Corporation's owner's salary is the only corporate income that is subject to the employment tax. Conversely, in the case of an LLC, the entire amount realized in the business (profits before subtraction of salary) is subject to the employment tax.

To form an Illinois S corp, you'll need to ensure your company has an Illinois formal business structure (LLC or corporation), and then you can elect S corp tax designation. If you've already formed an LLC or corporation, file Form 2553 with the Internal Revenue Service (IRS) to designate S corp taxation status.

Any small business corporation that is defined as such by the IRC section 1361 and has a net income or loss that falls under the definition of the Illinois Income Tax Act (IITA) will have to file a Small Business Corporation Tax Return of Form IL-1120-ST.

How Much Is an S Corp in Illinois? Because you don't have to separately register an S Corp in Illinois, there's no state-based fee to obtain this tax election. However, you'll pay these fees to register your LLC with the state, which is required to become an S Corp: File articles of organization: $150.

Subchapter S corporations and partnerships pay replacement tax of 1.5 percent (. 015). S corporations and partnerships do not pay Illinois Income Tax. Generally, income from an S corporation or partnership is passed on to the shareholders or partners.

To form an Illinois S corp, you'll need to ensure your company has an Illinois formal business structure (LLC or corporation), and then you can elect S corp tax designation. If you've already formed an LLC or corporation, file Form 2553 with the Internal Revenue Service (IRS) to designate S corp taxation status.