How to Start a Series LLC in Illinois? (Step by Step Guide)

Jon Morgan
Published by Jon Morgan | Co-Founder & Chief Editor
Last updated: May 3, 2024
FACT CHECKED by Lou Viveros, Growth & Transition Advisor
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A series LLC in Illinois can be helpful for businesses with multiple lines of business, as it allows them to keep their different operations separate and shield each from the liabilities of the others.

We spent two weeks at a conference in Illinois with the best lawyers specializing in series LLCs, and with them, we created a step-by-step guide for beginners and entrepreneurs.

In this guide, you will get all the information that you need on how to start a series LLC in the state, backed up by our years of knowledge in business formation.

Quick Summary

  • To start a Series LLC in Illinois, you will have to go through the mandatory step of drafting and filing Articles of Organization with the Illinois Secretary of State. 
  • Filing Series LLC Articles of Organization costs $400, but you can pay an additional $100 to expedite the processing. 
  • Considering that 1.3 million small businesses constitute 99.6% of all businesses in Illinois, establishing a Series LLC can provide a competitive edge in a market dominated by small enterprises.
  • As a legal expert specializing in high-stakes transactions, I find expedited processing services crucial for entrepreneurs who are short on time, especially when establishing a Series LLC in Illinois, where time-sensitive filings can impact business operations.


5 Steps to Start a Series LLC in Illinois

Two clipboards with files organized inside

Reflecting the vibrant entrepreneurial spirit in Illinois, data from the US Small Business Administration reveals that between March 2021 and March 2022, 40,933 new establishments opened in the state [1]. This surge underscores the importance of understanding the process to start a Series LLC in Illinois.

To set up your Illinois Series LLC, follow these steps:

1. Choose a Name

Like any other business, you will need to come up with a name for your series LLC. The name must be unique and cannot include words that are restricted under Illinois law.

The rules for creating a new business name for a series LLC are slightly different from those in other states. In Illinois, you must follow conventional LLC naming rules and include the whole name of the master LLC in the name of each child series.

2. Choose an Illinois Registered Agent

As with any other business, you will need to choose a registered agent in the state of Illinois who can accept the service of process on your behalf.

To transact business in the State of Illinois, you must use a registered agent who is a resident of Illinois or a corporation authorized to do business there. You may choose yourself as the registered agent for the company.

3. File the Articles of Organization

You will need to file a series of LLC articles of organization with the Illinois Secretary of State. This document will include information about the master LLC and each child series.

You must file separate articles of organization for each child series LLC. The initial filing fee is $400 plus an additional $50 per business day if not filed by the date due.

The articles of organization will provide certain basic information about your company (its name, principal office location, and the name and address of its registered agent, for example) as well as information about each series, also known as Certificate of Designation and Articles of Amendment.

You must prepare an initial statement of information in which you provide basic information about your business, including its name, purpose, registered agent, and address.

You will need to file this statement with the Illinois Secretary of State and pay a filing fee. The next important step is to create an operating agreement within the master LLC.

4. Create a Series LLC Operating Agreement

Like any other limited liability company, you will need to create an LLC operating agreement governing the operations of your series LLC between the series LLC owners.

The operating agreement will spell out the rights and responsibilities of the members of each series, as well as the requirements for adding or removing members, initiating a new series, and dissolving the company.

The operating agreement will also spell out the authority and procedures for operating each series and how profits and losses in each series will be managed.

We recommend seeking legal advice or assistance from a law firm when you are preparing your Illinois series LLC operating agreement.

5. Obtain an Employer Identification Number for Each Series

If you have employees, each series of your Illinois series LLC will need to obtain its own Federal Employer Identification Number from the Internal Revenue Service.

Department of the Treasury Internal Revenue Service discourages employees from using either the parent company's or child companies' EIN when completing a Form W-4 or a Form I-9 [2].

An individual who has been using an EIN must apply for a new number if he or she becomes an employee of a series LLC.

Other Things To Consider

Close up image of a man reading the file thoroughly

There are a few other things you should keep in mind when forming an Illinois series LLC.

Each series within your Illinois series LLC must keep its records and file its taxes separately from the master LLC.

You will each need to maintain a separate business bank account and credit cards for each series, and each series must have its tax identification number.

1. Separate Liability Protection

Each series within your Illinois series LLC is a separate legal business entity with its business debts and liabilities, as well as its assets and separate bank accounts.

This means that you or any other members of the master LLC are not personally liable for another series' mistakes or debts, even for the annual report.

2. Series Do Not Have to Be Independent

Although each series in your Illinois series LLC is a separate entity from the master LLC, they do not have to be independent of one another.

You may have overlapping ownership interests or membership between series, or even cross-series transactions alongside the parent LLC.

This flexibility can help manage your business operations. This means that each entity must have its operating agreement.

3. Mergers and Acquisitions

As with any other type of limited liability company, you may merge or acquire another business as a series of your Illinois series LLC.

This one of the promising ways I help my clients to grow their companies without having to create new entities.

4. Winding Down a Series LLC

If you decide to dissolve one of your series, you will need to file articles of dissolution with the Illinois Secretary of State just as you would with any other limited liability company.

"The Articles of Dissolution document encapsulates critical details regarding the dissolution of a Series LLC, outlining the distribution of assets in alignment with stipulations set forth in the operating agreement," asserts an industry expert."

- Delina Yasmeh, J.D./Tax LL.M, Distinguished Expert in Mergers & Acquisitions

5. Obtaining Licenses and Permits

Each series of your Illinois series LLC will need to obtain the appropriate LLC business license and permits required for conducting business in Illinois separate from the parent LLC.

The specific documents you need may vary based on your line of business, but they will likely include state and local tax registrations, business licenses, and zoning permits.

Be sure to research the specific requirements for your industry and location so that you can stay compliant.

Additionally, you can request help from professional companies that offer LLC services.

Related Articles:

Pros of Starting an Illinois Series LLC

Explaining someone all the pros of starting an Illinois series LLC

As a business owner, you must be aware of the few key benefits of starting an Illinois series LLC:

Limited Liability Protection

Limited liability protection is one of the biggest benefits of running series LLCs. This can help shield different lines of business from the liabilities of others within the organization.

Ease of Administration

When it comes to the formation and ongoing operation of a series LLC, Illinois has some of the more flexible rules in place.

Businesses are not required to file separate articles of organization for each series created under the master LLC. The initial filing fee is also lower than many other states require.

Flexible Membership

Business owners in Illinois series LLCs can have different ownership requirements for each series they create.

For example, a business with multiple lines of business could require that some series only allow the company's principals to hold membership interests while others permit outsiders with certain qualifications.

Tax Treatment

A major benefit of a Series LLC is how it is taxed. For federal tax purposes, each series LLC is treated as a separate entity.

This can be advantageous for businesses with multiple lines of business as it allows them to file their taxes separately and claim any applicable deductions and credits.

Cons of Starting an Illinois Series LLC

Files on clipboard laying on the table

While there are many advantages to forming a series LLC, there are also a few potential drawbacks:

Limited Liability Protection

While the limited liability protection provided by a series LLC is a major benefit, it can also be a drawback if one of the series experiences financial trouble.

The liabilities of the troubled series could then spill over and impact the other series within the organization.

Difficulty in Lending

Illinois series LLCs can sometimes have difficulty receiving loans from lending institutions.

Banks, for example, may be hesitant to provide a loan to an organization if it does not know which series the loan would go toward or if several different organizations are handling various lines of business under the same structure.

Unlimited Duration

Another potential drawback to an Illinois series LLC is that its existence is not limited in time.

This may seem like a benefit, but there are also considerable drawbacks if the parent company goes out of business and stops providing administrative services for the different series within the organization.

Read more: What is a Series LLC


Can an Illinois Series LLC Help Protect My Personal Assets?

Yes, an Illinois Series LLC can help protect your personal assets. Each series functions as a distinct legal entity with separate debts, liabilities, assets, and operating agreements, providing enhanced protection for personal assets.

Can You Change an LLC to a Series LLC in Illinois?

Yes, you can change an LLC to a Series LLC in Illinois by filing articles of organization with the Illinois Secretary of State. This will include information about the number and designation of each series you wish to create, as well as your name and address. You will also need to pay a filing fee.

Can I Transfer Assets Between Different Series of My Series LLC in Illinois?

Yes you can transfer assets between different series of your Illinois series LLC as long as certain procedures are followed, such as the annual report. It applies even to separate bank accounts.



About The Author

Co-Founder & Chief Editor
Jon Morgan, MBA, LLM, has over ten years of experience growing startups and currently serves as CEO and Editor-in-Chief of Venture Smarter. Educated at UC Davis and Harvard, he offers deeply informed guidance. Beyond work, he enjoys spending time with family, his poodle Sophie, and learning Spanish.
Learn more about our editorial policy
Growth & Transition Advisor
LJ Viveros has 40 years of experience in founding and scaling businesses, including a significant sale to Logitech. He has led Market Solutions LLC since 1999, focusing on strategic transitions for global brands. A graduate of Saint Mary’s College in Communications, LJ is also a distinguished Matsushita Executive alumnus.
Learn more about our editorial policy

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4 thoughts on “How to Start a Series LLC in Illinois? (Step by Step Guide)

  1. I was a bit overwhelmed by the process of forming a Series LLC in Illinois until I read this post. Your step-by-step guide really broke it down for me and made it easy to understand. I was able to successfully register my Series LLC without any issues. Thanks for sharing your expertise!

  2. I just started my Series LLC in Illinois and this step-by-step guide was a huge help! I would have been lost without it. Thank you for making it so easy to understand and follow along.

  3. Thanks for this helpful guide! I found the step-by-step process very easy to follow. I’m actually in the process of forming a Series LLC in Illinois and this post clarified a lot of the confusion I had. One thing I did want to ask is if there are any specific requirements for naming the separate series within the LLC? Was looking forward to hearing back from you on that!

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