This article provides three key state business startup requirements for self-employed sole proprietors and general partners who run residential house cleaning businesses. Information from the Secretary of State, the Illinois State Department of Revenue and selected city and county government sources were used to research this article.
Be aware that sole proprietor and general partner startup requirements in this state are always changing. Some requirements even vary from county to county. It is important that you call or visit your local county or city government to find out local requirements for residential house cleaning businesses and home-based businesses. This article is not intended to be exhaustive or a substitute for qualified legal or tax advice.
Business Name Registration
Sole proprietors and general partners who want a business name that does not include the owner(s) full legal names (for example, Janice Smith’s Cleaning Service or Martha Harris and Tom Graham’s Maid Service) need to find out whether the name they want to use is available in the county where the business is based. Start with a search of business names currently in use by incorporated businesses in Illinois.
Then do an online search for names similar to the one you plan to use. For example, if you want to use the name, Crystal Clean Maid Service, do simple Google searches for “Crystal Clean Maid Service+Illinois” plus Crystal Clean Maid Service+your county” and “Crystal Clean Maid Service+your town or city”. Search beyond the first page of results. Go at least five pages deep into the search results to see if the name you want or similar names are being used in your state, county or city.
Sole proprietors and general partners must register a business name with a local county clerk for an Assumed Name or DBA (“doing business as” name) certificate. If the company name is available, fill out the Assumed Name registration form and have it notarized. Then file it with the county clerk’s office. The county clerk should be able to provide copies of the Assumed Name Certificate, so be sure to request certified copies, for your bank and your business records. Find an Illinois County Clerk and Recorder.
After registering an Assumed Name or DBA with the county, businesses must publish their Assumed Names once a week for three successive weeks in a local county newspaper within 15 days of registration.
In the state of Illinois, registering an Assumed Name or DBA certificate does not guarantee a business sole rights to the use of that name. Other businesses in the state may also register the same fictitious name. Registered businesses are expected to legally defend their trade names.
Business License Registration
Sole proprietors and general partners do not have to apply for a business license with the State of Illinois. Residential house cleaning service businesses must apply for a business license at their city and county clerk’s offices.
In Illinois, a general partnership is created when two or more owners form an oral or written agreement to start a business together. General partners are not required to file any documents with the Secretary of State. It is advisable for general partners to file an Assumed Name or DBA in the county. A written partnership agreement drawn up by a lawyer is important for both or all partners. Partnership agreements do not have to be filed with the state.
Sole proprietors and general partners may apply for an Employer Identification Number (EIN) from the IRS even if they do not plan to hire employees. Getting an EIN may make it easier to open a bank account and reduce your risk of identity theft. You can apply for an EIN online. In addition, some business registration forms will require a a NAICS business classification number for the house cleaning industry.
Business Tax Registration
All businesses located in Illinois must register with the Illinois Department of Revenue.
Residential housecleaning services are not taxable in Illinois. Cleaning services do not have to collect and send sales taxes to the Department of Revenue.
Sole proprietors and general partners pay tax on business income to the state of Illinois through their personal state tax return. Sole proprietors and general partners are responsible for paying estimated self-employment income taxes in Illinois (on Form IL-1040-ES) similar to the way self employment taxes are paid to the federal government. Get more information about estimated tax requirements by calling the Illinois Department of Revenue at (800) 732-8866.
Illinois general partnerships that file a Federal partnership information Form 1065, may need to file state income tax Form IL-1065. Partnerships are also required to pay the the state’s personal property replacement tax at a rate of 1.5% of net income. Get more information from a CPA or qualified tax preparer to find out if your partnership must file those returns.
Selected Illinois City Licenses
Aurora Business License: The city of Aurora does not require a business license for residential house cleaning services.
Bloomington Business License: http://www.cityblm.org/doing-business/construction-development/business-registration
Champaign Business License: https://champaignil.gov/starting-your-business/
Chicago Business License: https://www.chicago.gov/city/en/depts/bacp/provdrs/bus/svcs/apply_for_a_businesslicenseonline.html
Cicero Business License: http://thetownofcicero.com/departments/business-licenses/
Decatur Business License: The city of Decatur does not require a business license for residential house cleaning services.
Elgin Business License: https://www.cityofelgin.org/1079/Business-License
Evanston Business License: https://www.cityofevanston.org/business/business-licenses/
Joliet Business License: https://www.joliet.gov/departments/city-clerk-s-office/business-services
Naperville Business License: https://www.naperville.il.us/services/permits–licenses/
Peoria Business License: The city of Peoria does not require a business license for residential house cleaning services.
Rockford Business License: The city of Rockford does not require a business license for residential house cleaning services..
Springfield Business License: The city of Springfield does not require a business license for residential house cleaning services.
Waukegan Business License: https://www.waukeganil.gov/162/Getting-Started