How to Get a Business License in Illinois

One of the most important elements of starting a business in Illinois is making sure you have all the requisite licenses and permits. The requirements vary by state, some of which have as many as 300 different licenses and permits. This article is too short to list them all, but it’s crucial that you’re aware of which ones your business needs and that you follow the steps for application. 

In Illinois, every business needs certain licenses and permits to legally operate as a business. The regulatory hurdles required vary depending on the type of business, its location, and the products and services offered. 

To help you launch your new business, this article lays out the most commonly needed permits and licenses in Illinois — and details the steps required to acquire them. 

Why are business licenses required in Illinois?

Business licenses and permits are issued to certify that a business and its products and services are safe for the public. This explains why food businesses, for instance, require more licenses than most other business types. 

In Illinois, all businesses, even sole proprietorships, must register with the Department of Revenue to be permitted to sell products or services. 

Which agency issues business licenses in Illinois?

In Illinois, the Department of Revenue issues the vast majority of licenses and permits, though some are issued by the Department of Agriculture and the Commerce Commission. For instance, the Department of Agriculture issues various farming permits, but the Commerce Commission issues truck driver’s permits.  

Some licenses and permits are issued by cities or counties. For example, if you live in Peoria, you need to check with that city to see if licenses or permits are required for your business by the city. 

Before you apply, it’s important to know which state or local agency issues the license you need. Check the state’s guidelines here to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

Steps to Get an Illinois Business License

In Illinois, the steps for acquiring specific licenses and permits vary widely, so it’s important to be aware of what you need and how to get it. 

Determine the Types of Licenses That You Need 

The licenses you need will depend on your type of business. If you sell tangible goods, you’ll need a seller’s permit, also known as a sales tax permit. If you sell alcohol, you’ll need a liquor license. If your business is agriculture-related, you’ll need certain licenses and permits from the Department of Agriculture. 

Illinois has a webpage where you can search for keywords related to your business and find information on required licenses and permits. 

Types of Business Licenses

Your business may need local, state, and/or federal licenses and permits, depending on your type of business. Fees for these vary, but most costs are minimal.

Federal regulations associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific permits. 

You may also need state-level and local county or city-based licenses. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments to learn more. The most common permits and licenses include: 

1. Business operating licenses may be required by the city and the state to allow you to operate. 
2. Industry-specific licenses may be required, depending on your type of business. Businesses involved in construction, childcare, plumbing, electrical, food and liquor, insurance, finance, landscaping, and architecture all require licensing, for example. In some highly regulated industries, you may require licensing from a federal agency, such as the FDA or the Department of Transportation.
3. Zoning permits are issued by municipalities to ensure you’re operating in an area in which you’re allowed to operate.  
4. Building permits verify that the building you’re operating in is up to code. Home occupation permits, which some areas require, allow you to operate a business from your home.
5. DBA permits allow you to do business under a name that is different from your legally registered business name.
6. Sales tax permits allow you to sell products and collect sales tax. 
7. An employer identification number (EIN) is required if you plan to have employees, no matter what your business entity type. 
8. Health licenses and permits are required for certain businesses based on industry, and you will be required to maintain health and safety standards. Environmental permits are also required for certain industries in some locations.
9. Fire permits certify that your business is up to fire safety codes. Depending on your location, this may be required for all businesses, while in other areas, it’s required only if you work with flammable materials.
10. Sign permits may be required for your location or other signage if there are rules about sign size and location.

Again, check with local government offices in your area for specific requirements based on your location and industry.

Submit Your Business License Application

You’ll submit your business license applications through the relevant department’s website. For example, you’ll need to register with the Department of Revenue, which is where you will get your sales tax permit. There is no fee to register your business, though some licenses do require fees.

How much does an Illinois business license cost?

Fees vary based on the type of license. They can range from zero for a sales tax permit up to $750 for a liquor license. 

In Illinois and most US states, jumping through all the hoops to acquire the necessary licenses and permits can be exhausting. But if you want to operate your business, you’ll have to wade through all the red tape. So get started on these regulatory hurdles as early as possible and clear the way for your entrepreneurial journey to success. 

How fast can I get a business license in Illinois?

Your initial business registration only takes two days if you file online. Most business licenses and permits are generally issued within a few days to a week. A liquor license, for example, takes five to seven days. 

Renew Your Licences When Needed

Most business licenses need to be renewed annually. It’s generally a very simple process that you can do online.