Filing LLC taxes in Illinois starts with how your LLC is classified for federal tax purposes, because the state follows that classification and routes you to a different return accordingly. Almost every Illinois LLC also owes the Personal Property Replacement Tax, a state-level tax with no federal equivalent, charged at 1.5% of net income for partnerships and S-corporations or 2.5% for C-corporations on top of the 7% corporate income tax.1Illinois Department of Revenue. How Does Illinois Tax a Limited Liability Company (LLC)?2Justia. Illinois Compiled Statutes Chapter 35 – 35 ILCS 5 Illinois Income Tax Act, Article 2 – Tax Imposed Returns go through MyTax Illinois, and a separate annual report goes to the Secretary of State.
Which Return Your LLC Files
Illinois accepts whatever election your LLC made with the IRS and assigns a form based on that:
- Single-member LLC with no special election: Illinois treats you as a disregarded entity. The LLC has no separate state return. Income flows through to your personal Form IL-1040.1Illinois Department of Revenue. How Does Illinois Tax a Limited Liability Company (LLC)?
- Multi-member LLC taxed as a partnership: file Form IL-1065, the Partnership Replacement Tax Return. This calculates the 1.5% replacement tax and distributes income to members on Schedule K-1-P.3Illinois Department of Revenue. 2025 Form IL-1065, Partnership Replacement Tax Return
- LLC taxed as an S-corporation: file Form IL-1120-ST, the Small Business Corporation Replacement Tax Return, at the same 1.5% replacement tax rate.
- LLC taxed as a C-corporation: file Form IL-1120, which combines the 7% corporate income tax and the 2.5% replacement tax on one return.2Justia. Illinois Compiled Statutes Chapter 35 – 35 ILCS 5 Illinois Income Tax Act, Article 2 – Tax Imposed
Zero income does not cancel the filing obligation for partnerships, S-corporations, or C-corporations. You still file a return showing no activity. Only the single-member disregarded entity avoids a separate state filing entirely.
If your LLC operates in more than one state, these returns include apportionment schedules that split income between Illinois and other jurisdictions, and Illinois generally applies a sales-factor formula. Before you start a return, pull your Federal Employer Identification Number, your Illinois Department of Revenue account number, gross receipts, deductible expenses, and any out-of-state income figures.
When Each Return Is Due
Deadlines are tied to the close of your tax year, and they differ by classification:
- Form IL-1065 (partnerships): the 15th day of the 4th month after year-end. For calendar-year filers, April 15.4Illinois Department of Revenue. Partnerships
- Form IL-1120-ST (S-corporations): the 15th day of the 3rd month after year-end. For calendar-year filers, March 15.5Illinois Department of Revenue. Who Must File Form IL-1120-ST and When Is Its Due Date?
- Form IL-1120 (C-corporations): the 15th day of the 4th month after year-end. For calendar-year filers, April 15.
Illinois grants extensions automatically. You do not file a separate extension form. Non-corporate filers get six months, corporations get seven. The extension covers filing only. Any tax owed is still due on the original deadline, and unpaid balances accrue interest at a rate the Department resets twice a year, currently 7% through at least June 30, 2026.6Legal Information Institute. Extensions of Time for Filing Returns, All Taxpayers (IITA Section 505)7Illinois Department of Revenue. Interest Rates
The late-filing penalty starts at 2% of the tax due, capped at $250. If you still have not filed 30 days after the Department mails you a nonfiling notice, a second penalty applies: the greater of $250 or 2% of the tax shown on the return, capped at $5,000. Those sit on top of interest.
The Pass-Through Entity Tax Election
Partnerships and S-corporations can elect to pay Illinois’s pass-through entity (PTE) tax, a workaround for the $10,000 federal cap on state and local tax deductions. The electing LLC pays 4.95% on its net income at the entity level, and each member gets a credit for their share against their personal Illinois tax.8Illinois Department of Revenue. Publication 129, Pass-through Entity Information
You make the election on Form IL-1065 or Form IL-1120-ST itself. It becomes irrevocable once the extended due date for that year passes, and it is a year-by-year choice. The PTE tax is in addition to the 1.5% replacement tax, not instead of it. For a nonresident member whose only Illinois-source income comes from the electing entity, the credit can eliminate their personal IL-1040 filing requirement entirely if it covers their full Illinois liability.8Illinois Department of Revenue. Publication 129, Pass-through Entity Information
Estimated Payments
If your LLC elects the PTE tax and expects to owe more than $500 for the year (counting PTE tax and replacement tax together), it must make quarterly estimated payments. The due dates are the 15th of the 4th, 6th, 9th, and 12th months of the tax year, which for a calendar-year LLC means April 15, June 15, September 15, and December 15.9Illinois Department of Revenue. Business Income Tax Estimated Payments
Partnerships and S-corporations that have not elected the PTE tax generally do not owe entity-level estimated payments for the replacement tax alone.10Illinois Department of Revenue. Illinois Estimated Payments Requirements for Individuals and Businesses (Pub-105) Members receiving K-1 income may still owe personal estimated payments on their own IL-1040 if their withholding falls short. The entity can be clear while the owners are not.
How to Submit and Pay
MyTax Illinois is the Department of Revenue’s online portal for filing income and replacement tax returns. You can key data in directly or upload a completed form. Payment options include ACH direct debit from a business bank account and credit card. Credit card processors charge a convenience fee of roughly 2.25%, so ACH is the cheaper route for anything beyond a nominal amount.11Illinois Department of Revenue. Pay by Credit Card
Paper filing is still allowed. Mail income tax returns to the Illinois Department of Revenue, PO Box 19007, Springfield, IL 62794-9007, with a check for any balance due. The envelope has to be postmarked by the deadline. Electronic filings confirm immediately and typically process within a day or two; mailed returns can take weeks to appear in the state’s system, so file online if you are close to a deadline.
Semi-weekly withholding filers have to pay electronically. Monthly withholding filers may use Form IL-501 or pay through MyTax Illinois. W-2s and other information returns must be submitted to Illinois electronically regardless of your payment schedule.12Illinois Department of Revenue. FY 2026-15, What’s New for Illinois Income Taxes
Don’t Forget the Annual Report
Separate from any tax return, every Illinois LLC must file an annual report with the Secretary of State. It is not a tax document. It updates your registered agent, office address, and management information under 805 ILCS 180/50-1.13Illinois General Assembly. 805 ILCS 180/50-1 – Annual Reports
The filing window opens 60 days before the first day of your LLC’s anniversary month and closes on the first day of that month. The form is LLC-50.1 and the fee is $75. The Secretary of State uses a different website from MyTax Illinois, does not grant extensions, and charges a penalty for late submissions. Missing it long enough leads to administrative dissolution, which is a bigger problem than any late tax penalty.
Illinois fully repealed the corporate franchise tax starting in 2024, so LLCs taxed as corporations no longer owe that filing. The annual report is the only recurring Secretary of State requirement.
Sales Tax and Payroll Registration
If your LLC sells physical goods, leases tangible property, rents hotel rooms, or provides certain taxable services, you need to register for sales tax using Form REG-1. Illinois’s base statewide rate is 6.25%, with local add-ons. Sales tax returns (Form ST-1) run on a monthly, quarterly, or annual schedule the Department assigns based on your volume.14Illinois Department of Revenue. Sales and Use Taxes
If you have employees, the same REG-1 form registers you for Illinois withholding. The withholding rate is a flat 4.95% of wages, remitted on either a semi-weekly or monthly schedule with quarterly returns in both cases. These obligations run in parallel with your income and replacement tax filings, not instead of them.