2021 Form IL-1120


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What Is the IL Form 1120?

This is the State of Illinois Corporation Income and Replacement Tax Return form. Essentially, the IL Form 1120 is designed to determine a corporation's tax liability for the year. This form applies to all corporations conducting business in Illinois, including S-Corporations and C-Corporations. Each company has to properly complete this form to evaluate its taxable income or loss according to Illinois adjustments, exclusions, and preferences.

2021 Form IL-1120 Screenshot

Preparation steps for form Il-1120

Before you embark on the mission to fill out the form there are a few preparational steps:

  • Collect all relevant financial documents: You’ll need records of your income, expenses, dividends, cost of goods sold, and information about any tax credits you’re eligible for. 
  • Understand your corporation's status: Whether your corporation is domestic or foreign will affect the corresponding sections of the form.

How to Fill Out the Illinois Form IL 1120

Now comes the prospect of filling out the Illinois Form IL 1120, which can be tricky. Let’s break down this task into manageable steps:

  1. In the "Tax year beginning and ending" section, enter the exact dates of your corporation's tax year. Make sure to format the dates as indicated in the provided spaces (mm/dd/yyyy).
  2. In the "Enter the amount you are paying" section, insert the amount of money your corporation is paying for the tax year. Ensure to double-check for any transposition errors.
  3. In the "Identify your corporation" section, provide specific, accurate information about your corporation, including its name, address, Federal Employer Identification Number (FEIN), and Illinois withholding number. This information should match exactly with the information you have on file with the state and federal governments.
  4. In the "Figure your income or loss" section, calculate your corporation's income after subtracting all allowable deductions and business expenses. If you have a net loss for the tax year, you will enter this amount as a negative figure.
  5. In the "Figure your base income or loss" section, use your corporation's total income, and apply the state's specified standards or exemptions, if any.
  6. In the "Figure your income allocable to Illinois" section, calculate your corporation's total income that is subject to Illinois state tax. If your corporation operated in other states during the tax period, you will need to apportion your income accordingly.
  7. The "Figure your net income" section subtracts any allowable deductions from your corporation's income allocable to Illinois.
  8. The "Figure your replacement tax after credits" section applies any non-refundable corporate credits your corporation can claim.
  9. In the "Figure your income tax after credits" section, subtract the credits used in the previous step from your corporation's net income to determine the income tax owed.
  10. The "Figure your refund or balance due" section indicates whether your corporation is due a refund or owes a balance. You would have a refund if you paid too much in estimated taxes. If not, you would owe a balance.
  11. In the "Sign below" section, sign and date the form. The officer authorized to deal with the organization's financial matters should provide their title and phone number.
  12. The "Paid Preparer Use Only" section should be filled out if a third party prepared the form. A paid preparer should sign and date it, provide their PTIN, and complete the information about their firm, including the name, address, and FEIN. If the preparer is self-employed, they should check the box indicating this. 

Importance of Il-1120 form

For companies running in Illinois, submitting the form IL-1120 is not a matter of choice but a requirement. This form allows the state's Department of Revenue to assess each company's fiscal contribution and ensure that every cent due in business tax is accounted for.

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