Georgia vs Illinois LLC Formation 2026: Fees, Taxes & Compliance Comparison
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Introduction: Quick Verdict and Key Differentiator
Georgia wins for cost-conscious formation, but Illinois offers superior long-term flexibility.
Georgia's LLC filing fee of $110.00 (O.C.G.A. § 14-11-204) undercuts Illinois's $150.00 fee by $40. Georgia's annual registration costs $60.00 versus Illinois's $75.00 annual report fee—a $15 annual savings. However, Illinois permits Series LLCs under 805 ILCS 180/37-40, enabling you to create subsidiary series within a single LLC structure for asset protection and operational efficiency. Georgia prohibits Series LLCs entirely. For single-entity startups prioritizing immediate savings, Georgia prevails. For scalable ventures requiring internal compartmentalization without multiple state filings, Illinois's Series LLC framework justifies the higher formation cost.
| Metric | Georgia | Illinois | Winner |
|---|---|---|---|
| LLC Formation Fee | $110.00 (O.C.G.A. § 14-11-204) | $150.00 (805 ILCS 180/5-5) | Georgia (+$40 savings) |
| Annual Report Fee | $60.00 (O.C.G.A. § 14-11-603) | $75.00 (805 ILCS 180/50-1) | Georgia (+$15 annual savings) |
| Name Reservation Fee | $35.00 | $25.00 | Illinois (+$10 savings) |
| Registered Agent Change Fee | $30.00 | $25.00 | Illinois (+$5 savings) |
| Series LLC Available | No | Yes (805 ILCS 180/37-40) | Illinois (structural flexibility) |
| State Income Tax Rate | 5.19% flat (O.C.G.A. Title 48, Chapter 7) | 4.95% individual / 1.5% replacement tax (35 ILCS 5/) | Illinois (0.24% lower individual rate) |
| Sales Tax Rate | 4% state + local (varies) | 6.25% state + local (varies) | Georgia (2.25% lower baseline) |
The differentiator: Illinois's Series LLC statute (805 ILCS 180/37-40) allows you to establish protected subsidiary series within one LLC filing, eliminating separate state registrations for each operating division. Georgia's prohibition on Series LLCs forces you to file multiple standalone LLCs if you need internal asset compartmentalization. For multi-line businesses, Illinois's structural advantage offsets its $40 higher formation fee within the first year.
FAQ: Three Critical Questions for Georgia vs Illinois LLC
Question 1: What's the True Cost to Form and Maintain an LLC in Year One?
Georgia costs less upfront but Illinois catches up with higher annual compliance fees. Georgia charges $110 for Articles of Organization filing (O.C.G.A. §§ 14-11-204 to 14-11-206) plus $60 for your first annual registration due between January 1 and April 1 (O.C.G.A. § 14-11-603). Illinois charges $150 for Articles of Organization (805 ILCS 180/5-5) plus $75 for the first annual report due before your anniversary month (805 ILCS 180/50-1). Over 12 months, Georgia totals $170 while Illinois totals $225—a $55 difference favoring Georgia.
| Cost Category | Georgia | Illinois |
|---|---|---|
| Articles of Organization | $110.00 | $150.00 |
| First Annual Report/Registration | $60.00 | $75.00 |
| Year One Total | $170.00 | $225.00 |
| Registered Agent Change | $30.00 | $25.00 |
| Name Reservation (optional) | $35.00 | $25.00 |
Winner: Georgia. You save $55 in formation and first-year compliance costs. Georgia's $110 filing fee undercuts Illinois's $150 by $40, and Georgia's $60 annual registration costs $15 less than Illinois's $75 annual report.
If you need expedited processing, Georgia offers two-business-day service for $120 (O.C.G.A. § 14-11-204) or same-day service before noon for $275. Illinois offers 24-hour expedited processing for $100 (805 ILCS 180/5-40). For urgent formation, Illinois's expedited option costs $20 less than Georgia's two-business-day option.
Question 2: Which State's Tax Burden Hits Harder on LLC Income?
Both states tax LLC pass-through income at the owner level, but Illinois imposes an additional replacement tax that Georgia doesn't. Georgia taxes individual income at a flat 5.19% (O.C.G.A. Title 48, Chapter 7), with no separate replacement tax. Illinois taxes individual income at 4.95% but adds a 1.5% replacement tax on Illinois-taxable income for partnerships and S corporations (35 ILCS 5/). This means an Illinois LLC electing S-corp status pays 4.95% + 1.5% = 6.45% total state tax, exceeding Georgia's 5.19% by 1.26 percentage points.
| Tax Type | Georgia | Illinois |
|---|---|---|
| Individual Income Tax Rate | 5.19% | 4.95% |
| Replacement Tax (LLC/S-Corp) | None | 1.5% |
| Combined Rate | 5.19% | 6.45% |
| Sales Tax (State Only) | 4.00% | 6.25% |
| Corporate Income Tax (C-Corp) | 5.19% | 7.00% + 2.5% replacement |
Winner: Georgia. Your LLC's pass-through income faces a lower combined state tax rate. Georgia's flat 5.19% beats Illinois's 6.45% combined rate by 1.26 percentage points. If you operate in Illinois and elect S-corp status, you pay an extra 1.5% replacement tax that Georgia doesn't impose.
On a $100,000 pass-through profit, a Georgia LLC owner pays $5,190 in state income tax. An Illinois LLC owner with the same income pays $6,450—a $1,260 annual difference. Over five years, that's $6,300 in additional Illinois tax liability. Georgia's sales tax baseline (4%) also undercuts Illinois's 6.25% state rate by 2.25 percentage points, though local add-ons vary in both states.
Question 3: Which State Offers Better Operational Flexibility and Asset Protection?
Illinois offers series LLCs for liability compartmentalization; Georgia does not. Illinois permits series LLCs under 805 ILCS 180/37-40, allowing you to establish separate series within one LLC with distinct assets and liabilities. Georgia's LLC Act (O.C.G.A. Title 14, Chapter 11) contains no series LLC provision. Both states provide standard charging order protection. Neither state requires a written operating agreement, but both allow you to customize governance through one. Illinois also permits low-profit LLCs (805 ILCS 185/), which Georgia does not.
| Feature | Georgia | Illinois |
|---|---|---|
| Series LLC Available | No | Yes (805 ILCS 180/37-40) |
| Low-Profit LLC Available | No | Yes |
| Professional LLC Available | Yes | Yes |
| Operating Agreement Required | No | No |
| Charging Order Protection | Standard | Standard |
| Anonymous LLC | No | No |
Winner: Illinois. You gain structural flexibility through series LLCs and low-profit LLC options. If you need to isolate liability across multiple business lines within one entity, Illinois's series LLC statute (805 ILCS 180/37-40) gives you that option. Georgia forces you to form separate LLCs for each liability compartment, increasing formation and compliance costs.
A series LLC in Illinois allows you to establish Series A, Series B, and Series C—each with separate assets, liabilities, and operating agreements—all under one parent LLC filing. This eliminates the need to file three separate LLCs in Georgia, saving you $330 in formation fees ($110 × 3) and $180 annually in registration fees ($60 × 3). For multi-line businesses, Illinois's series structure pays for itself within one year.
Master Comparison Table: All Dimensions — Georgia vs Illinois LLC
Formation Costs and Processing
Georgia charges $110 for standard LLC filing, while Illinois charges $150—a $40 difference favoring Georgia. Georgia's expedited options range from $120 (two business days) to $1,200 (one hour), whereas Illinois offers 24-hour service for $100 additional. Both states process standard filings in approximately 10 business days. Georgia's lower base fee makes it the more economical choice for standard formation, though Illinois's expedited option costs less if you need faster processing.
| Dimension | Georgia | Illinois |
|---|---|---|
| Standard Filing Fee | $110.00 (O.C.G.A. § 14-11-204) | $150.00 (805 ILCS 180/5-5) |
| Two-Business-Day Expedited | $120.00 (O.C.G.A. § 14-11-206) | N/A |
| 24-Hour Expedited | N/A | $100.00 (805 ILCS 180/5-40) |
| Same-Day (before noon) | $275.00 (O.C.G.A. § 14-11-206) | N/A |
| One-Hour Processing | $1,200.00 (O.C.G.A. § 14-11-206) | N/A |
| Standard Processing Time | 7– |