How to Get a Video Gaming License in Illinois: Terminal Operators and Licensed Establishments

Illinois allows video gaming terminals in licensed establishments across the state, with a strict regulatory framework overseen by the Illinois Gaming Board. Whether you operate a tavern, truck stop, or fraternal organization, or you want to become a terminal operator, you need to understand the licensing requirements, fees, and profit-sharing obligations. This guide walks you through the process for both roles in the Illinois video gaming system.

Understanding the Two Roles in Illinois Video Gaming

Illinois video gaming operates under a split licensing model defined in 230 ILCS 40. There are two distinct participants: the terminal operator and the licensed establishment.

The terminal operator is the entity licensed by the Illinois Gaming Board to own, manage, and service video gaming terminals. They are responsible for the machines, compliance with gaming laws, and reporting to the Gaming Board. The licensed establishment is the physical location (a tavern, truck stop, fraternal club, or veterans organization) where the terminals are placed. The establishment must obtain separate licensing and agrees to host the terminals on its premises.

These are not the same entity. A single terminal operator may place machines in multiple establishments across Illinois, and a single establishment may host terminals from one operator. The profit from video gaming is split 50/50 after taxes between the operator and the establishment, as required by statute.

Materials and Requirements Needed Before You Apply

Before submitting an application to the Illinois Gaming Board, you must have several items in place, depending on whether you are applying as a terminal operator or a licensed establishment.

If You Are Applying as a Terminal Operator

• Business entity documentation (Articles of Organization for an LLC, Articles of Incorporation for a corporation, or sole proprietorship verification).
• Proof of liquid funds or financing sufficient to purchase and service video gaming terminals.
• A detailed business plan showing how you will operate terminals, comply with gaming law, and manage service calls.
• Personal background documents for all owners and officers (identification, tax returns, financial statements).
• Authorization to conduct credit checks and background investigations (required as part of the application).
• Payment for the $5,000 nonrefundable terminal operator application fee.

If You Are Applying as a Licensed Establishment

• A retail liquor license for consumption on the premises (package-only stores do not qualify) OR documentation of status as a truck stop, fraternal organization, or veterans club authorized to host terminals under Illinois law.
• Proof of business ownership or a lease agreement for the premises where terminals will be located.
• Personal background documents if you own the business (identification and tax returns).
• The street address of the location (a P.O. Box alone is not accepted).
• Payment for the establishment licensing fee and annual per-terminal fees.

For Both Roles

• Verified Illinois address for all applicants and principals.
• Federal employer identification number (EIN) or Social Security number.
• Consent to comply with all Illinois Gaming Board rules and statutory requirements under 230 ILCS 40.

Step-by-Step Process to Obtain Your Video Gaming License

Step 1: Determine Your Role and Confirm Location Eligibility

Decide whether you will apply as a terminal operator, a licensed establishment, or both. Then confirm that your proposed location (or locations) meet Illinois Gaming Board requirements.

A location is ineligible if it is within 1,000 feet of a horse racing facility or a casino's home dock, or within 100 feet of a school or place of worship (230 ILCS 40/25(h)). Illinois law also limits the number of terminals per establishment: most establishments may host a maximum of 6 terminals, while large truck stops (those meeting size and service requirements) may host up to 10 terminals. You will need to verify that your location meets these requirements before applying.

Step 2: Obtain Required Underlying Licenses or Documentation

If you are applying as a licensed establishment, you must first obtain an Illinois liquor license appropriate to your business type, unless your business qualifies as a truck stop, fraternal organization, or veterans club. Apply to your local liquor commissioner first, then to the Illinois Liquor Control Commission for the state license. This process typically takes 2 to 8 weeks, depending on your municipality and whether any public notice period is required.

If you already hold a valid liquor license, gather proof of that license. If your business is a truck stop, fraternal organization, or veterans club, obtain documentation from the appropriate body (your national or state fraternal organization, for example) confirming your status.

Step 3: Contact the Illinois Gaming Board for Application Materials

Visit the Illinois Gaming Board website or contact them directly to request application forms and current fee schedules. Check the Gaming Board website for the current application method and forms.

Provide the Gaming Board with the information about your business type, proposed location(s), and your role (terminal operator, licensed establishment, or both). The Board will send you the appropriate application forms and a summary of current fees and requirements.

Step 4: Complete the Application Forms

Fill out the application form completely and truthfully. The Board requires detailed information about:

• Your business entity and ownership structure.
• All owners, officers, managers, and key personnel (the Board conducts background checks).
• Your business plan and financial statements.
• For terminal operators: proof that you have access to funds to purchase and maintain equipment and compliance systems.
• For licensed establishments: proof of your liquor license or qualifying status, and details of your proposed location(s).

Be prepared to answer detailed questions about your background, any criminal history, financial stability, and your understanding of Illinois gaming law. The application process is designed to ensure that only qualified, compliant operators manage video gaming in Illinois.

Step 5: Submit Your Application and Fees

Submit your completed application to the Illinois Gaming Board along with the required application fee. Terminal operator applications carry a $5,000 nonrefundable fee, and the Gaming Board charges annual licensing fees as well. Licensed establishments pay a $100 application fee and an annual license fee of up to $100. The $100 annual per-terminal fee is split equally between the terminal operator and the licensed establishment under statute (230 ILCS 40/45).

Keep a copy of your submitted application and all supporting documents for your records. The Gaming Board will provide you with a confirmation number or receipt when your application is received.

Step 6: Background Investigation and Board Review

Once your application is submitted, the Illinois Gaming Board will conduct a background investigation of you, your business principals, and any financial backers. This investigation may take several weeks to several months, depending on the complexity of your business structure and any flag raised during the review. The Board will contact you if they need additional information or clarification.

The Board reviews your application against the statutory criteria in 230 ILCS 40, which include your financial fitness, background, character, ability to comply with gaming regulations, and suitability to operate or host video gaming machines in Illinois.

Step 7: Approval and License Issuance

If the Illinois Gaming Board approves your application, you will receive a video gaming license and any required documentation. For terminal operators, the license authorizes you to own, service, and place terminals in licensed establishments across Illinois (subject to each establishment's maximum terminal count). For licensed establishments, the license permits you to host terminals from approved operators and to receive revenue from video gaming under the 50/50 profit-split requirement.

Once licensed, you are required to comply with all ongoing Gaming Board reporting, record-keeping, and audit requirements. Violations of gaming law can result in fines, suspension, or loss of your license.

Illinois Video Gaming Fees: What to Budget

Video gaming licensing in Illinois involves several fee categories:

• Terminal Operator Application Fee: $5,000, nonrefundable. The Board also sets an annual terminal operator license fee of up to $5,000.
• Licensed Establishment Licensing Fee: $100 to obtain a license.
• Annual Per-Terminal Fee: $100 per terminal per year, split equally between the terminal operator and the licensed establishment (so each party pays $50 per terminal annually).
• Local (Municipal and County) Fees: In addition to state fees, municipalities and counties may impose their own licensing and per-terminal fees. These vary significantly. For example, Springfield imposes local fees, as does Chicago. Chicago legalized video gaming in its FY2026 budget, and the Illinois Gaming Board began licensing Chicago locations in June 2026. If your location is in Chicago, you will need to pay Chicago's local video gaming fee in addition to the state fee. The exact current amount should be verified directly with the Chicago Department of Business Affairs and Consumer Protection (BACP).

Before applying, contact your municipality to learn what local fees apply to your specific location. These fees can be substantial and vary widely across Illinois.

Chicago Video Gaming: Current Status and Special Requirements

Chicago legalized video gaming in its FY2026 budget under Municipal Code Section 4-155. The Illinois Gaming Board began licensing Chicago locations in June 2026. However, as of late August 2026, no video gaming machines were reported to be operating in Chicago, and the mayor asked the City Council to reverse legalization. Verify the current status of Chicago video gaming legalization and licensing with the Illinois Gaming Board and the City of Chicago before investing time and money in an application.

If Chicago video gaming licensing remains active, Chicago locations require a Tavern or Consumption on Premises Incidental liquor license to host terminals. The establishment limit in Chicago is a maximum of 6 terminals. Chicago also imposes local per-terminal fees that you must confirm with the city.

Profit Sharing: The 50/50 Split After Tax

Illinois law requires that after-tax profit from video gaming be split 50/50 between the terminal operator and the licensed establishment (230 ILCS 40/25). This means that once state and local taxes are paid, the remaining profit is divided equally. This split is non-negotiable and is enforced by the Gaming Board through audit and reporting requirements.

Terminal operators must maintain detailed records of revenue, taxes paid, and profit distributions to each establishment. Licensed establishments must do the same. Both parties are required to file periodic reports with the Illinois Gaming Board documenting revenue and compliance with the profit-split rule.

Tips to Avoid Common Mistakes

• Apply for the liquor license first if you need one: If you are opening a new tavern or bar to host terminals, obtain your liquor license before applying for video gaming licensing. The Gaming Board will not approve your application without proof of a valid underlying liquor license (or qualifying status).
• Understand location restrictions: Do not assume that your location is eligible until you have confirmed the distance from schools, places of worship, horse racing facilities and casino home docks. The Gaming Board will deny applications for ineligible locations.
• Budget for local fees: Many applicants underestimate local fees. Municipalities and counties add substantial per-terminal fees on top of state fees. Call your city or county clerk before you apply to confirm the total cost of licensing at your location.
• Be prepared for background investigation: The Gaming Board investigates all owners and key personnel. Any undisclosed criminal history, tax liens, or financial red flags can result in denial. Be honest and transparent on your application.
• Know the profit-split requirement: You cannot negotiate the 50/50 profit split with your partners. Illinois law mandates this split, and it is a condition of licensing. Make sure your business plan accounts for this requirement.
• Document everything: Keep detailed records of revenue, taxes, and distributions. The Gaming Board audits licensees, and incomplete or misleading records can result in fines or loss of license.
• Verify Chicago status before investing: If you are planning to operate in Chicago, contact the Gaming Board and the city to confirm that legalization remains in effect. Planned regulatory changes or reversals can derail an investment.

Frequently Asked Questions

How long does it take to get a video gaming license in Illinois?

The timeline depends on the complexity of your application and how quickly the Gaming Board's background investigation proceeds. A straightforward application for an established business with a clean ownership background may take 4 to 8 weeks. Applications involving new businesses, multiple owners, or flagged background items can take 3 to 6 months or longer.

Can I operate video gaming terminals if I do not own the establishment?

Yes. As a terminal operator, you place machines in licensed establishments operated by others. You own and maintain the equipment and pay the terminal operator portion of state and local fees. The establishment owner manages the site and receives their share of profit. You do not need to own or operate the bar, truck stop, or other location.

What happens if I do not comply with the profit-split requirement?

Non-compliance with the 50/50 profit-split rule is a violation of Illinois gaming law. The Gaming Board can impose fines, suspend your license, or revoke it entirely. You and your establishment partner are each liable for compliance.

Can I relocate my terminals to a different establishment?

Yes, but the new establishment must be licensed, and it must not exceed the maximum number of terminals allowed. You must notify the Gaming Board of any changes in terminal placement and may need to file updated reports. Some municipalities also require notice to the city or county.

Are video gaming terminals and slot machines the same thing?

No. Video gaming terminals in Illinois are a separate category of gaming equipment regulated by the Gaming Board. Slot machines are allowed only at licensed casinos and racetrack gaming facilities under the Illinois Gambling Act. Video gaming terminals offer games of chance, but they are distinct from casino slot machines and are subject to different regulations.

Important Disclaimer

This article is for informational purposes only and does not constitute legal or tax advice. Illinois video gaming licensing is a complex area of law, and requirements change. The Illinois Gaming Board's rules, fee schedules, and background investigation standards are the authoritative source for your license application. Before you invest time and money in an application, consult the Gaming Board directly, and consider working with an attorney licensed in Illinois who specializes in gaming law. Your specific situation may require compliance steps or face special restrictions beyond those described here.

Verify all current fees, application forms, and procedural requirements with the Illinois Gaming Board before submitting an application. Verify the current status of video gaming legalization and licensing in any specific city or municipality (such as Chicago) before making business decisions based on video gaming revenue.