Comparison
Illinois LLC vs. Ohio LLC — head to head
All figures verified against official state portals as of 2026-05-08.
| Factor | Illinois (IL) | Ohio (OH) |
|---|---|---|
| Formation filing fee | $150 | $99 |
| Annual SOS/report fee | $75/year Annual Report | $0/year (no annual LLC report) |
| Five-year state filing cost | ~$525 | ~$99 |
| State income tax / owner tax | 4.95% individual income tax; partnership/S-corp LLCs also face 1.5% Personal Property Replacement Tax on net Illinois income. | Graduated individual income tax with top rates below Illinois; municipal income tax can apply in Ohio cities. |
| Franchise, replacement, or gross-receipts tax | No classic franchise tax; Illinois PPRT applies to partnership/S-corp LLC net income and Cook County/Chicago taxes may add local layers. | Commercial Activity Tax is a gross-receipts tax. Current Ohio rules use a $6M exclusion for 2025+; older $1M shorthand is stale. |
| Operating-state recommendation | Best when Illinois is the real operating state; avoid foreign qualification and Chicago-area nexus risk. | Best for Ohio operating companies that want the rare no-annual-report posture. |
| Foreign qualification risk | A Illinois LLC operating in Ohio may need Ohio foreign qualification, tax registration, and an in-state registered agent. | A Ohio LLC operating in Illinois may need Illinois foreign qualification, tax registration, and an in-state registered agent. |
| Publication requirement | None | None |
| Filing portal | Illinois SOS LLC online filing | Ohio Business Central |
| Best fit | Best when Illinois is the real operating state; avoid foreign qualification and Chicago-area nexus risk. | Best for Ohio operating companies that want the rare no-annual-report posture. |
Illinois costs about $525 in state SOS fees over five years ($150 + five $75 reports) versus Ohio at about $99 with no annual LLC report. But an Ohio LLC operating in Illinois may owe Illinois foreign registration, the $250 foreign annual report, Illinois tax, and Illinois registered-agent coverage.
Five-year state-fee delta
IL vs. OH carrying cost
Registered agent service excluded because it usually applies in either state.
| Year | Illinois | Ohio |
|---|---|---|
| Year 1 | ~$225 | ~$99 |
| Year 2 | ~$300 | ~$99 |
| Year 3 | ~$375 | ~$99 |
| Year 4 | ~$450 | ~$99 |
| Year 5 | ~$525 | ~$99 |
Illinois annual obligations
What a Illinois LLC must file each year
- Due date
- Annual Report due before the first day of the anniversary month; $75 domestic report ($250 foreign LLC report).
- Fee
- $75/year Annual Report
- What to file
- Annual Report due before the first day of the anniversary month; $75 domestic report ($250 foreign LLC report).
- Failure consequence
- Late filings can trigger fees, loss of good standing, administrative dissolution, or tax collection consequences depending on the filing.
- Filing portal
- Illinois annual filing portal
Ohio annual obligations
What a Ohio LLC must file each year
- Due date
- No Ohio annual LLC report or state annual LLC fee. CAT may apply to Ohio taxable gross receipts above the current exclusion.
- Fee
- $0/year (no annual LLC report)
- What to file
- No Ohio annual LLC report or state annual LLC fee. CAT may apply to Ohio taxable gross receipts above the current exclusion.
- Failure consequence
- Late filings can trigger fees, loss of good standing, administrative dissolution, or tax collection consequences depending on the filing.
- Filing portal
- Ohio annual filing portal
Illinois name rules
LLC name requirements in Illinois
- Required designators include LLC, L.L.C., or Limited Liability Company.
- Name must be distinguishable on Illinois SOS records.
- Annual report is due before the anniversary month; foreign LLC annual report fee is higher than domestic.
- Search at the Illinois business entity database before filing.
Ohio name rules
LLC name requirements in Ohio
- Required designators include LLC, L.L.C., Limited Liability Company, Limited, or Ltd.
- Name must be distinguishable on Ohio Business Central records.
- Name reservation is available for $39 for 180 days.
- Search at Ohio Business Search before filing.
City-specific guides
Illinois and Ohio LLC formation by city
State rules apply statewide; city guides cover local context and additional permits.
Registered agents
Registered agent requirements: Illinois vs. Ohio
| Requirement | Illinois | Ohio |
|---|---|---|
| Required | Yes | Yes |
| Who can serve | IL resident 18+ with in-state street address, or registered IL entity | OH resident 18+ with in-state street address, or registered OH entity |
| Self-serve allowed | Yes (address becomes public state record) | Yes (address becomes public state record) |
| Consent required | Registered agent acceptance is captured in the filing; agent must maintain an Illinois office. | Statutory agent acceptance is required; agent must maintain an Ohio address. |
| Commercial RA typical cost | $50–$150/yr | $50–$150/yr |
Decision framework
How to choose: Illinois vs. Ohio LLC
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Start with the operating state Employees, offices, inventory, property, local licenses, and recurring in-state customers usually decide where the LLC must register. The cheaper formation state is not cheaper if it adds foreign qualification.
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Compare Secretary of State fees IL: $150 formation + $75/year report ($250/year foreign LLC report). OH: $99 formation + no annual LLC report. Form where you operate; Illinois nexus and PPRT often erase an Ohio paper advantage for Illinois operators.
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Compare tax exposure Illinois: 4.95% individual income tax; partnership/S-corp LLCs also face 1.5% Personal Property Replacement Tax on net Illinois income. No classic franchise tax; Illinois PPRT applies to partnership/S-corp LLC net income and Cook County/Chicago taxes may add local layers. Ohio: Graduated individual income tax with top rates below Illinois; municipal income tax can apply in Ohio cities. Commercial Activity Tax is a gross-receipts tax. Current Ohio rules use a $6M exclusion for 2025+; older $1M shorthand is stale.
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Price foreign qualification before filing Model both directions: domestic formation in one state plus foreign registration, annual reports, tax filings, registered agent cost, and local licenses in the operating state.
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Use corridor-specific facts Ohio wins on state filing cost; Illinois wins only when Illinois is the operating-state reality.
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File and calendar compliance After choosing the operating state, file through the official portal, obtain an EIN, adopt an operating agreement, set up payroll/tax accounts if needed, and calendar annual statements or reports.
Provenance
Statute basis & official sources
Last verified 2026-05-08.
805 ILCS 180; 35 ILCS 5; 30 ILCS 115/12; Ohio Rev. Code Chapter 1706; Ohio Rev. Code Chapter 5751; IRS check-the-box regulations for federal LLC classification; state revenue guidance linked below.
Why you need an LLC (either state)
- Operating without an LLC leaves personal assets exposed to business debts, leases, and lawsuits.
- Forming in the wrong state can create dual registered agents, dual annual filings, and avoidable foreign qualification.
- Ignoring state income tax, gross-receipts tax, replacement tax, local income tax, or city licensing can create penalties and loss of good standing.
- Banks and payment processors commonly require filed formation documents, EIN confirmation, and an operating agreement.
FAQ
Illinois vs. Ohio LLC — common questions
Is it cheaper to form an LLC in Illinois or Ohio?
Illinois costs about $525 in state SOS fees over five years ($150 + five $75 reports) versus Ohio at about $99 with no annual LLC report. But an Ohio LLC operating in Illinois may owe Illinois foreign registration, the $250 foreign annual report, Illinois tax, and Illinois registered-agent coverage.
Should I form where I live or where I work?
For most owner-operated LLCs, form where the business actually operates: where you work, have employees, hold inventory, lease space, or repeatedly serve local customers. Residence matters for owner-level tax, but business nexus drives registration.
Can I form in the cheaper state and operate across the border?
Yes, but you may need foreign qualification in the operating state. That usually means another filing fee, another registered agent, and the operating state taxes you were trying to avoid.
Do these states require newspaper publication?
No. Ordinary LLCs in these Midwest states do not have the New York/Nebraska/Arizona-style publication requirement.
Does state formation change federal LLC tax treatment?
No. A single-member LLC is disregarded by default and a multi-member LLC is a partnership by default unless it elects corporate taxation. State-level taxes and reports differ, but federal classification does not.
When is a two-state LLC structure worth it?
Usually only when operations are genuinely split, there is real property in both states, customers or employees create nexus in both states, or a legal/tax advisor has a specific reason for a holding/operating company structure.
§ A Building permits by city
§ B LLC formation guides
§ C Companion tools
Disclaimer: Informational only — not legal advice. LLC laws change; verify with a Illinois or Ohio business attorney or CPA before filing.