LLC vs PLLC in Illinois: Formation Costs, Taxes & Liability (2026)
---
---
Introduction
Choose an LLC if you operate a general business and want maximum flexibility with minimal compliance burden. Choose a PLLC if you're a licensed professional (attorney, accountant, architect, engineer, physician, or dentist) and need liability protection tailored to professional practice under 805 ILCS 185/.
Both entities cost $150 to file in Illinois and offer personal liability protection. The critical difference: PLLCs restrict ownership to licensed professionals in the same field, while LLCs accept any owner. Your profession and ownership structure determine which fits.
What's the Difference Between an LLC and PLLC in Illinois?
An LLC is a general business structure available to any business type, while a PLLC (Professional Limited Liability Company) is restricted to licensed professionals. Both offer liability protection and pass-through taxation, but PLLCs must comply with professional licensing requirements under 805 ILCS 185/. Your choice depends on whether your business requires a professional license from the Illinois Department of Financial and Professional Regulation.
| Feature | LLC | PLLC |
|---|---|---|
| Formation Statute | 805 ILCS 180/5-5, 805 ILCS 180/5-40 | 805 ILCS 185/ |
| Eligible Businesses | Any business type | Licensed professionals only |
| Filing Fee | $150.00 | $150.00 |
| Annual Report Fee | $75.00 | $75.00 |
| Minimum Members | 1 | 1 |
| Registered Agent Required | Yes (805 ILCS 180/1-35) | Yes (805 ILCS 185/) |
| Operating Agreement Required | No | No |
Who Can Form a PLLC in Illinois?
A PLLC is available only to professions licensed by the Illinois Department of Financial and Professional Regulation. These include architects, attorneys, accountants, certified public accountants, engineers, physicians, dentists, psychologists, and other regulated professions under 805 ILCS 185/. If your profession isn't licensed by the state, you must form a standard LLC instead. Check the DFPR website to confirm your profession qualifies before filing.
Which is better for this dimension: PLLC is required if you're a licensed professional; LLC is your only option otherwise.
Are Formation Fees the Same for LLCs and PLLCs?
Both LLCs and PLLCs cost $150.00 to file with the Illinois Secretary of State under identical fee schedules. You'll submit Articles of Organization for an LLC under 805 ILCS 180/5-5 or the equivalent PLLC formation documents under 805 ILCS 185/. Expedited filing adds $100.00 for 24-hour processing for both entity types. There's no cost difference between the two structures at formation.
Which is better for this dimension: Neither—fees are identical.
What Are the Annual Compliance Costs?
Both LLCs and PLLCs file annual reports costing $75.00 each year, due before the first day of your anniversary month under 805 ILCS 180/50-1. If you miss the deadline, you'll face a $100.00 late penalty after 60 days. Failure to file within 120 days triggers administrative dissolution. Reinstatement costs $200.00 plus all delinquent fees and penalties.
| Compliance Item | LLC | PLLC |
|---|---|---|
| Annual Report Fee | $75.00 | $75.00 |
| Late Penalty | $100.00 (after 60 days) | $100.00 (after 60 days) |
| Reinstatement Fee | $200.00 | $200.00 |
| Filing Deadline | First day of anniversary month (805 ILCS 180/50-1) | First day of anniversary month |
Which is better for this dimension: Neither—annual requirements are identical.
How Does Taxation Differ Between LLCs and PLLCs?
Both LLCs and PLLCs are taxed identically under Illinois law. Single-member entities default to disregarded entity treatment (Schedule C), while multi-member entities default to partnership taxation (Form 1065). Both can elect S-corp or C-corp status. Illinois taxes individual income at 4.95%, partnerships at 1.5% replacement tax on Illinois-taxable income, and C corporations at 7% plus replacement tax under 35 ILCS 5/. Self-employment tax applies to both structures equally.
| Tax Element | LLC | PLLC |
|---|---|---|
| Single-Member Default | Disregarded (Schedule C) | Disregarded (Schedule C) |
| Multi-Member Default | Partnership (Form 1065) | Partnership (Form 1065) |
| Illinois Individual Tax Rate | 4.95% (35 ILCS 5/) | 4.95% (35 ILCS 5/) |
| Illinois Partnership Replacement Tax | 1.5% on taxable income | 1.5% on taxable income |
| C-Corp Election Available | Yes | Yes |
| S-Corp Election Available | Yes | Yes |
Which is better for this dimension: Neither—tax treatment is identical.
What Professional Restrictions Apply to PLLCs?
PLLCs must comply with professional licensing board requirements beyond standard LLC rules. Members and managers of a PLLC must be licensed in the regulated profession under 805 ILCS 185/. You cannot have unlicensed members managing a PLLC for architects, attorneys, accountants, or other regulated professions. An LLC has no such restrictions—any individual or entity can be a member or manager regardless of licensing status.
| Restriction | LLC | PLLC |
|---|---|---|
| Ownership Restrictions | None | Licensed professionals only (same field) |
| Unlicensed Members Allowed | Yes | No (violates 805 ILCS 185/) |
| Unlicensed Managers Allowed | Yes | No |
| Multi-Profession Ownership | Yes | No (same profession required) |
Which is better for this dimension: LLC if you want flexibility in ownership; PLLC is required if you're a licensed professional.
Can I Use a Registered Agent for Both Structures?
Yes. Both LLCs and PLLCs require a registered agent who is either an Illinois resident or a business entity authorized to do business in Illinois under 805 ILCS 180/1-35 and 805 ILCS 185/. You can change your registered agent by filing a Statement of Change of Registered Agent and/or Registered Office for $25.00. Members can serve as registered agents for both structures. The Secretary of State cannot serve as your registered agent.
| Registered Agent Element | LLC | PLLC |
|---|---|---|
| Requirement | Mandatory (805 ILCS 180/1-35) | Mandatory (805 ILCS 185/) |
| Who Can Serve | Illinois resident or authorized entity | Illinois resident or authorized entity |
| Member Can Serve | Yes | Yes |
| Secretary of State Can Serve | No | No |
| Change Fee | $25.00 | $25.00 |
Which is better for this dimension: Neither—registered agent rules are identical.
What Happens if I Need to Operate Under a Different Name?
Both LLCs and PLLCs must file an assumed name (DBA) with the Illinois Secretary of State if operating under a name other than the legal entity name. The DBA filing fee is $120.00 for both structures. Your entity name must include an LLC designator (Limited Liability Company, LLC, or L.L.C.) and be distinguishable from existing entities on file under 805 ILCS 180/1-10.
| DBA Element | LLC | PLLC |
|---|---|---|
| DBA Filing Fee | $120.00 | $120.00 |
| Required Designator | LLC, Limited Liability Company, L.L.C. | LLC, Limited Liability Company, L.L.C. |
| Distinguishability Required | Yes (805 ILCS 180/1-10) | Yes |
| Restricted Words | Corporation, Bank, Trust, Insurance, LP | Same restrictions |
Which is better for this dimension: Neither—DBA requirements are identical.
Can I Form a Series LLC or PLLC in Illinois?
Series LLCs are available under 805 ILCS 180/37-40. A series LLC costs $400.00 plus the $100.00 expedited fee if you want 24-hour processing. The state data does not specify whether series structures are available for PLLCs. Contact the Illinois Secretary of State at (217) 524-8008 to confirm PLLC series availability before filing.
| Series Structure | LLC | PLLC |
|---|---|---|
| Available | Yes (805 ILCS 180/37-40) | Unclear (contact ILSOS) |
| Filing Fee | $400.00 | N/A |
| Expedited Fee | +$100.00 | N/A |
Which is better for this dimension: LLC if you need a series structure; PLLC series availability is unclear.
Can I Convert My LLC to a PLLC Later if I Become Licensed?
Yes, but it requires filing new Articles of Organization as a PLLC under 805 ILCS 185/ and meeting the professional licensing requirements. You'll pay the standard $150 filing fee again. The conversion is not automatic—you must affirmatively elect PLLC status and ensure all members hold active licenses in the same profession. Plan ahead if professional licensure is on your roadmap.
Which is better for this dimension: LLC offers more flexibility if licensure is uncertain; PLLC requires commitment to professional status.
What Happens if a Non-Licensed Person Owns a PLLC?
A PLLC violates 805 ILCS 185/ if non-licensed individuals hold membership. The Illinois Department of Financial and Professional Regulation can challenge the entity's status and force dissolution or conversion to an LLC. Stick with an LLC if your ownership includes unlicensed investors, family members, or business partners outside your licensed profession.
Which is better for this dimension: LLC if you have unlicensed co-owners; PLLC requires all members to be licensed.
Side-by-Side Comparison Table
| Dimension | LLC | PLLC |
|---|---|---|
| Formation Filing Fee | $150.00 | $150.00 |
| **Expedited Fee |