Illinois LLC Operating Agreement Template [PDF]

Outline how your company will be operated by creating an Illinois operating agreement using our professional and customizable template.

Customized for Illinois This document may be legally binding in Illinois according to your state specific regulations.

The Illinois limited liability company (LLC) operating agreement is a legal document that provides the duties and responsibilities of each member within the company and defines how the company will be managed on a daily basis.

The LLC operating agreement, or business operating agreement, doesn’t have a strict form, meaning that the parties are free to draft the provisions according to their specific needs as long as they are in line with federal and state laws that regulate LLCs and operating agreements.

Is an Operating Agreement Required in Illinois?

No, the operating agreement is not required in Illinois. However, the parties that want to optimize their business operations and prevent any misunderstandings between the members still choose to create the operating agreement.

4 Main Types of Operating Agreements

In Illinois, you have four main types of operating agreements you can choose to draft for your LLC:

Types of Operating Agreements

• Single-member LLC operating agreement: Here, there is only one member of the LLC, and the key purpose of the operating agreement is to define how the company will be operated without regulating the mutual relationship between the members.
• Multi-member LLC operating agreement: With this type of operating agreement, multiple members of the LLC want to determine how the company will be operated and provide rules that regulate the mutual relationship between the members.
• Member-managed LLC operating agreement: Here, the members who choose to participate directly in the decision-making process in an LLC regulate their managerial rights and responsibilities.
• Manager-managed LLC operating agreement: With this type of operating agreement, the members who don’t actively participate in the decision-making process provide guidelines for the professional managers on how the company will be operated.

Laws and Legal Requirements for LLC Operating Agreements in Illinois

805 ILCS 180, also called the Limited Liability Company Act, is a part of Illinois Statutes that regulates how LLCs operate in Illinois.

Moreover, 805 ILCS 180/15-5 regulates the operating agreements in particular. It provides the definition of an operating agreement as follows:

“‘Operating agreement’ means the agreement under Section 15-5 concerning relations among the members, managers, and limited liability company. The term ‘operating agreement’ includes amendments to the agreement.”

How to Form a Limited Liability Company (LLC) in Illinois

This section provides a step-by-step guide on how to form an LLC in Illinois:

How to Form a LLC in Illinois

#1. Choose a Name For Your LLC

Before submitting the application to form an LLC, you should choose a business name for your company and make sure it is distinguishable from business names used by other businesses registered in Illinois.

To do this, you can simply go to the Secretary of State website and do a business entity search.

#2. Choose the Type of LLC

Based on where your company is established, you can choose between two main types of LLCs to register:

• Domestic LLC: this refers to the companies established and registered in Illinois.
• Foreign LLC: this refers to the companies established outside but registered in Illinois.

#3. Nominate an Agent

Illinois state law requires every LLC to nominate a registered agent who will receive notifications on behalf of the LLC. It can be an individual with a registered address in Illinois or a company with authorization to conduct business in Illinois.

#4. File the Registration Documents

If you are registering a domestic LLC, you should submit the Articles of Organization. You can do it online or by filing a hard copy via mail.

If you are registering a foreign LLC, you should submit the Application for Admission to Transact Business in hard copy. After submitting it, you should file a Certificate of Existence authenticated by the authorities in the initial jurisdiction of the company.

#5. Pay the Required Fee

If you apply online, the filing fee is $600. If you are sending documents via mail, you should write a check for $500 and send the documents to the following address:

Department of Business Services, Limited Liability Division, 501 S. Second St., Rm. 351, Springfield, IL 62756

#6. Create your LLC Operating Agreement

Although not required by state laws, you can still draft the operation agreement and optimize the operation of your company.

#7. Apply For an Employer Identification Number (EIN)

This number is essential if you want to open a company bank account. You can apply for an EIN online or by filling out a form in hard copy.