If you are an employer in Illinois who has recently hired a new employee, you will need to register for payroll taxes with the Illinois Department of Revenue. This registration process ensures that you are compliant with state tax laws and can properly withhold and remit taxes on behalf of your employees.
How Illinois Payroll Registration Works
There are 2 payroll tax setup tasks you may need to complete in Illinois to get your new hire on payroll for the first time. You can follow the guide below to help you get registered directly with the Illinois agencies or use Mosey to do it.
Illinois Unemployment Insurance Setup for LLP, Corporation, LLC
You must file Form UI-1 to register for unemployment with the Department of Employment Security if you have paid $1,500 or more in wages in a single calendar quarter, or employed at least one person for 20 different weeks in a given calendar year. When registering a new business you can also register for Income Tax Withholding at the same time. Note: 501(c)(3) non-profit organizations must register if they have four or more employees during each of 20 weeks in a given calendar year. During the registration process, 501(c)(3) organizations will have the choice to either pay unemployment contributions on taxable wages each quarter or elect to reimburse the Illinois Unemployment Fund for benefits paid to terminated employees.
- Create a MyTax Illinois Account
Create a MyTax Illinois account to be able to register your business and remit taxes if you haven't already done so.
- File Form UI-1 Online
Register for an unemployment insurance account with the Department of Employment Security using the UI-1 application on MyTax Illinois. Alternatively, you can file forms REG-1 and UI-1 together by mail. Note: Nonprofits filing by mail would also need to submit the Reimburse Benefits in Lieu of Paying Contributions (Form UI-5NP), if opting for reimbursable status.
Illinois Withholding Tax Setup for Corporation, LLC, LLP
If you have employees in Illinois, you are required to register for a withholding account with the Department of Revenue by filing the Illinois Business Registration Application (Form REG-1). Note: When registering a new business you can also register for Unemployment Insurance at the same time.
- Create a MyTax Illinois Account
Create a MyTax Illinois account to be able to register your business and remit taxes if you haven't already done so.
- File the New Business Registration Application
Register as a new employer using the New Business Registration application (Form REG-1) on MyTax Illinois. This will create a withholding account with the Department of Revenue. Alternatively you can file forms REG-1 and UI-1 together by mail.
