Around 9 out of 20 workers are self-employed, and for good reason. Working for an employer may provide a steady paycheck, but you’re under someone else’s management. Breaking free of traditional employment and setting up your own company can be freeing—not to mention, more lucrative too.
A popular option is limited liability companies (LLCs), which offer certain benefits. But for some, they can go a step further and form a professional limited liability company (PLLC) instead.
What’s a PLLC and how can you make one? Read on to find out how to form a PLLC in Illinois.
What Is a PLLC?
When looking at a PLLC vs LLC in Illinois, a PLLC is a more specific type of LLC meant for people who provide certain professional services. In the past, the state of Illinois didn’t use this term, and the only type of LLC was the general one.
However, in recent years, they’ve required the switch from LLC to PLLC from these specific professionals. Basically, anyone who’s licensed by the Illinois Department of Financial and Professional Regulation (IDFPR) must register as a PLLC.
This includes the following industries:
- Dentistry
- Medicine
- Professional counseling (including clinical)
- Clinical psychology
- Marriage and family therapy
- Social work
- Sex offender evaluation and treatment
On the other hand, you shouldn’t apply as a PLLC if you’re in the following industries:
- Accounting
- Beauty, barbering, or cosmetology services
- Design professional services
- Detective/security-related services
- Law/legal services
- Real estate
With the above, you’ll have to file applications that are for that particular industry.
Now that we’ve defined what a PLLC is, and which professions must form one, let’s explore the steps you need to take to make that happen.
Choose Your PLLC Name
Your PLLC must have a memorable name. If people don’t remember it when they need your services or products, then they won’t get in touch with you.
As you might’ve already guessed though, it has to be unique and available. There are several ways to check if a business name is taken, so explore these avenues.
In addition, Illinois PLLC requirements stipulate that the name must end with “Professional Limited Liability Company,” “PLLC,” or “P.L.L.C.” And since you’re a PLLC, you can’t use the terms “corporation,” “incorporated,” or “limited partnership” (or any of their abbreviations). You also can’t use any words or phrases that are forbidden due to any other Illinois statute.
For convenience’s sake, consider using our business name availability checker. It’s on our business registration service page, and we’ll tell you immediately if your desired name is free. You can then fill out your details if you’re interested in our affordable services, and we’ll contact you promptly.
Designate a Registered Agent
You’re required by law to have a registered agent for your business entity. This is someone who receives your PLLC’s official documents.
If you live in Illinois, you can technically be your own registered agent. However, there are undeniable advantages to using a service, such as Business Anywhere’s. We’ll save you time and trouble, which means it’ll free up time to focus on your PLLC.
File Your Articles of Organization
The articles of organization are required to create an LLC or PLLC in Illinois. You’ll need the following information for this document:
- PLLC name
- PLLC’s principal office
- PLLC’s purpose
- Names and addresses of the managers or members
- Name and address of the registered agent
- PLLC’s professional services
You’ll send this document to the Illinois Secretary of State. It’ll cost $150 and typically, they’ll review your articles of organization within 10 days of receiving it. If you’d like it to happen faster, you can pay an additional $100, which will get your documents reviewed within 24 hours (excluding weekends and holidays).
Create an Operating Agreement
An operating agreement isn’t always legally required for PLLCs in Illinois, but it’s still a good decision to have one. As the name implies, it clearly defines how you run your company, and it’s useful, as future partners, managing members, and even financial institutions may want to see it.
You can find free online templates to create an operating agreement, but if you have room in your budget, you should invest in an attorney’s services. This will give you peace of mind that your document is airtight.
Get the Necessary Licenses and Permits
To have a PLLC, all members and managers must have the required professional licenses for the services offered. This must be done before you form your company.
Plus, you’ll want to check with local governments for any additional permits or licenses needed to operate in your area. For example, you can check the IDFPR’s list on their website. These also must be obtained before you start your business.
Register for Illinois State Taxes
When establishing a PLLC in Illinois, you’ll have to register with the Department of Revenue. You can do this by submitting an Illinois Business Registration Application, which can be done either by snail mail or online.
On top of that, you’ll have to file an annual report with the Illinois Secretary of State. This will cost you $75.
Apply for an Employer Identification Number (EIN)
If your PLLC will have employees, you’ll need an EIN. This is like a personal Social Security Number (SSN), but for business entities. Many banks require an EIN for accounts anyway, so avoid trouble ahead of time by applying for one, even if you aren’t planning on hiring employees.
You can apply for an EIN through the IRS’s website. This is free to do, so you have nothing to lose.
Apply With the IDFPR
You can use the IDFPR’s online portal to carry this out. You’ll have to create a username and password associated with your email address.
The information you’ll need to provide them is as follows:
- PLLC business name
- Public address
- Mailing address (if different from public address)
- Tax information (including your federal tax identification number, or FEIN)
- Date of formation
- PDF copy of your articles of organization
- Members and managers
This application will cost $50 and you can use credit cards, debit cards, ACH, and eCheck.
Changing Your LLC to a PLLC
Do you already have an LLC in Illinois and need to change it to a PLLC, based on the industry criteria listed earlier? Then you’ll want to go to the Secretary of State’s website to fill out the amendment form.
On Form LLC 5.25, you’ll check the box for 3e, as well as 3h. Also, you’ll have to attach a file of your Articles of Amendment and a signed and dated statement showing you’ve changed your business name to have “PLLC” in it.
Start a PLLC in Illinois
Do you have professional services that can help the residents of Illinois? Then you should put them to good use by forming a PLLC.
The steps aren’t that different to forming an LLC, so if you have experience in that department, it shouldn’t be too difficult. However, it’s always good to have an expert’s help, as it can speed things along and lessen your stress.
If you need assistance forming a PLLC in Illinois, then sign up with Business Anywhere. Count on our experts to get your company set up effortlessly.
