Is an Illinois LLC a good option for a business with customers nationwide?

Your cousin is probably just repeating what he did without understanding why. If you live in Indiana, form your LLC there. Done.

Not that simple though. Illinois has some fees and a franchise tax that Indiana doesn't. Why would you pay extra for no benefit? Unless you're actually operating out of IL, it's usually a waste. What does your cousin say when you ask him why?

Also, foreign Qualification. If you form in IL but run from IN, you'll likely need to register as a foreign LLC in Indiana anyway. So now you're paying two states.

This comes up a lot. The general rule is form where you're located, not where your csutomers are. Customers nationwide doesn't mean you need an LLC in every state. That would be insane.

Right.And for an online store, nexus rules for sales tax are separate from LLC formation. Don't confuse the two. You might have sales tax obligations in other states but that doesn't mean you need an LLC there.

lol @ 'my cousin said so' being the entire business plan

It doesn't. Nobody cares what state your LLC is from. Your customers care if your stuff shows up on time.

To be fair, there are edge cases. If you're planning to raise money from investors or eventually have a real office in Chicago, Illinois could make sense. But for a one-person handmade shop? No.

I formed an LLC in a state I didn't live in once because a 'friend' said it was better for privacy. Ended up paying an extra registered agent fee and annual report fee for two years before I dissolved it and redid it at home. Don't be me.

That's the other thing. Illinois requires a registered agent with a physical Illinois address. If you don't have one, you're paying a service. For what? A mailing address you'll never use

I'm just here for the cousin updates. Did he also tell you to get a PO box in Delaware?

Good call. And tell your cousin to stop giving business advice.