State Comparison

Florida vs Illinois LLC

Side-by-side comparison of forming an LLC in Florida vs Illinois — fees, processing times, taxes, and decision factors to help you choose the right state for your business.

Florida

Filing fee$125

Processing5–8 days

Annual report$138.75

State income taxNone

None on LLCs

Illinois

Filing fee$150

Processing5–10 days

Annual report$75

State income tax4.95% flat

1.5% replacement tax on S-corp net income

Lower state fees:

Illinois — $225 total 1st-year state fees

Excludes franchise tax, registered agent, and other compliance costs

Pros and Cons

Florida (FL)

Pros

No state income tax
No franchise tax on LLCs
Relatively low $138.75 annual report fee
Large economy with strong tourism and international trade
Business-friendly regulatory environment

Cons

$400 late fee after May 1 annual report deadline is a common trap
Public member disclosure — names on annual report
Sales tax compliance can be complex

Illinois (IL)

Pros

PTET election available to work around SALT cap
Strong Midwest economy centered on Chicago
Moderate state filing fees

Cons

1.5% replacement tax on S-corp net income
Annual report deadlines trigger loss of good standing if missed
Relatively high state income tax (4.95% flat)

Side-by-Side Comparison

Feature	Florida	Illinois
LLC filing fee	$125	$150
Corporation filing fee	$70	$150
Annual report fee	$138.75	$75
Processing time	5–8 days	5–10 days
State income tax	None	4.95% flat
Franchise / entity tax	None on LLCs	1.5% replacement tax on S-corp net income
Popular formation state?	Yes	No

Which Should You Choose?

Choose Florida if...

• Top-3 state for LLCs by cost-benefit

• Strong for real estate, tourism, and e-commerce businesses

• You live or operate primarily in Florida — forming locally avoids foreign qualification costs and compliance in multiple states.

Choose Illinois if...

• PTET is a meaningful SALT-cap workaround for high earners

• Consider if operating in Chicago metro

• You live or operate primarily in Illinois — forming locally avoids foreign qualification costs and compliance in multiple states.

FAQ

Is it cheaper to form an LLC in Florida or Illinois?

Florida charges $125 filing + $138.75 annual report. Illinois charges $150 filing + $75 annual report. Illinois is the cheaper option on state fees alone, though franchise tax and other compliance costs also matter.

Should I form my LLC in Florida or Illinois?

For most businesses, form in the state where you actually operate. Florida (None state income tax) and Illinois (4.95% flat state income tax) each have their specific characteristics. If you physically operate in one of these states, form there. Forming in Florida while operating in Illinois (or vice versa) means paying fees in both states.

Can I form my LLC in Florida and operate in Illinois?

Yes, but you'll need to "foreign qualify" in Illinois, which means paying a registration fee in Illinois plus ongoing compliance in both states. You'll also typically owe Illinois state taxes on income earned there regardless of where the LLC is formed. Forming in a single state (usually your home state) is typically cleaner and cheaper for small businesses.

What are the annual costs for an LLC in Florida vs Illinois?

Florida: None on LLCs — plus $100-$300/yr for a registered agent. Illinois: 1.5% replacement tax on S-corp net income — plus $100-$300/yr for a registered agent. Budget an additional $500-$2,000/yr for accounting, bookkeeping, and business license renewals regardless of state.

Which state has better asset protection — Florida or Illinois?

Asset protection varies by state statute. States like Wyoming, Nevada, and Delaware have the strongest charging-order-exclusive doctrines for LLC members. Florida and Illinois both offer LLC liability protection, but consult an attorney for state-specific asset protection planning if you have significant personal assets to shield.

Florida resources

Illinois resources

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Pros and Cons

Florida (FL)

Pros

No state income tax
No franchise tax on LLCs
Relatively low $138.75 annual report fee
Large economy with strong tourism and international trade
Business-friendly regulatory environment

Cons

$400 late fee after May 1 annual report deadline is a common trap
Public member disclosure — names on annual report
Sales tax compliance can be complex

Illinois (IL)

Pros

PTET election available to work around SALT cap
Strong Midwest economy centered on Chicago
Moderate state filing fees

Cons

1.5% replacement tax on S-corp net income
Annual report deadlines trigger loss of good standing if missed
Relatively high state income tax (4.95% flat)

Feature

Florida

Illinois

LLC filing fee

$125

$150

Corporation filing fee

$70

$150

Annual report fee

$138.75

$75

Processing time

5–8 days

5–10 days

State income tax

None

4.95% flat

Franchise / entity tax

None on LLCs

1.5% replacement tax on S-corp net income

Popular formation state?

Yes

Which Should You Choose?

Choose Florida if...

• Top-3 state for LLCs by cost-benefit

• Strong for real estate, tourism, and e-commerce businesses

• You live or operate primarily in Florida — forming locally avoids foreign qualification costs and compliance in multiple states.

Choose Illinois if...

• PTET is a meaningful SALT-cap workaround for high earners

• Consider if operating in Chicago metro

• You live or operate primarily in Illinois — forming locally avoids foreign qualification costs and compliance in multiple states.