Since starting Ideal Project Group in 2006, numerous people have asked me what steps you need to take in order to open a business in Chicago. When I first looked into creating the company, I recall being appalled at how many different sites I had to visit just to make sure I was doing everything correctly. In addition, it was pretty difficult just to determine the order of the steps I had to take. The disclaimer to this post is that I'm not an attorney, this isn't legal advice, and it's your responsibility to make sure you've done everything correctly. This being said, everything below outlines what was done to create Ideal Project Group, LLC. I hope you find this information helpful, and if you happen open a business I wish you the best of luck.

Step One

First, go to the Secretary of State's website to make sure the name you want to use isn't taken. Once you've come up with a name, register your business by filling out the online application. (Note, this is the LLC application, but you can browse the site for other corp. types that you can set up.) You can do all this online, and it costs a whopping $600 - ouch. Do this step first because you don't need a federal ID to register your business, but you do need your business name, which will be required when you go to get your FEIN.

Step Two

Get a Federal Employer ID (FEIN) from the US government. This is essentially a SS# for a business. Hooray, you are now a small business - one little piece in the backbone of the American economy.

Step Three

Now that you're a business, you'll need to register with the state of Illinois. This is also to give you a license at some point so depending on your business type you may want to wait until you've secured a business location. In addition, this will give you your Illinois Business Tax ID - so the govt can collect sales tax. This is used if, for example, you're a retailer. If you don't collect sales tax you'll likely never use this number except for when you get your license from the City of Chicago.

Step Four

To do business in the city of Chicago you need to get a City of Chicago Business License. For this one, you need to have your Illinois Business Tax ID which we just covered in Step Three. Also, you may need to have a location so the city can okay the business you're going to start in the location you want to start it. The form for this can be found here, and it also contains many of the links I provided above.

You have to actually go down to city hall to get the license, but it's not that big of a deal. In fact, I recall being surprised at how efficiently the place was run. On top of that, you'll meet a bunch of other people starting their own business, and the process of actually going to City Hall, applying for the license, and seeing other entrepreneurs was pretty inspirational. This of course is after you get over the fact that in America you need a license from the government just to start a business. But, let's not get into that now.

Step Five

If/When you hire employees, you'll also need to register with the Illinois Unemployment Insurance Agency. They'll calculate the percentage of your employee's salaries that you need to pay for unemployment insurance.

That's it. The first two steps are the most important because once that's done you can go to the bank and open a checking and savings account and a credit card in your company name. Then you can start buying stuff under your new company name!

Step Six

Get to work!

I hope you found this helpful, and for those of you that are starting a business, I wish you the best of luck.