Form an LLC in California

What is different about forming an LLC in California

Creating a California LLC is an online-only act, and so is keeping it alive. The Secretary of State publishes no PDF Articles of Organization form and no PDF Statement of Information form; both fee-table rows read "Online Only." Terminations joined them on July 1, 2026, and since August 1, 2026 the online Statement of Information option appears only to users with web User Access established.

Two agencies hold the recurring obligations. The Secretary of State takes the $20 Statement of Information; the Franchise Tax Board takes the $800 annual tax and a separate LLC fee measured on gross receipts.

The $800 annual tax is owed in the first year

Every LLC doing business in California or registered with the Secretary of State pays an annual tax of $800, whether or not it is conducting business (Rev. & Tax. Code § 17941(a), (b)(1)). The first-year exemption in § 17941(g)(1)(A) reached only LLCs that organized, registered or filed with the Secretary of State on or after January 1, 2021 and before January 1, 2024, so an LLC formed now pays the $800 for its first taxable year. A different first-year amount is already scheduled: for taxable years beginning on or after January 1, 2027 and before January 1, 2030, the first-year tax is $400 (§ 17941(g)(2)). The relief that frees corporations from the minimum franchise tax in their first taxable year does not apply to limited liability companies (§ 23153(f)(2)).

The tax is due on or before the 15th day of the fourth month of the taxable year (§ 17941(c)). In the first year the Franchise Tax Board measures from the filing date: payment is due by the 15th day of the 4th month from the date the LLC files with the Secretary of State, so a June 18 formation carries a September 15 due date. Payment goes with LLC Tax Voucher (FTB 3522).

The annual tax runs for each taxable year, or part of one, until a certificate of cancellation of registration or of articles of organization is filed with the Secretary of State, and a return designated as final does not stop it (§ 17941(b)(2)).

The LLC fee is charged on gross receipts

A second annual payment starts once California income reaches $250,000. Section 17942(a) sets it by bracket: $900 at $250,000 to under $500,000, $2,500 at $500,000 to under $1,000,000, $6,000 at $1,000,000 to under $5,000,000, and $11,790 at $5,000,000 or more. Total income means income from all sources derived from or attributable to California, defined as gross income under § 24271 plus the cost of goods sold, so a company operating at a loss can still reach a bracket. The fee is estimated and paid by the 15th day of the sixth month of the current taxable year on Estimated Fee for LLCs (FTB 3536), and underpaying adds a penalty of 10 percent unless the amount paid by that date equals or exceeds the LLC's total fee for the preceding taxable year (§ 17942(d)). Form 568 is the annual return, and the California LLC taxes page goes further.

Filing the Articles of Organization

A California LLC is formed by signing and delivering Articles of Organization to the Secretary of State for filing under the California Revised Uniform Limited Liability Company Act, Corporations Code §§ 17701.01 through 17713.13, and it exists once the Secretary of State has filed them (§ 17702.01(a), (d)). The fee is $70.00, online only through bizfile Online at bizfileonline.sos.ca.gov.

Section 17702.01(b) fixes the contents: a statement that the purpose is to engage in any lawful act or activity for which an LLC may be organized under the title; the name; the street address of the initial principal office and the mailing address if different; the name and street address of the initial agent for service of process; and a statement if the LLC is manager-managed or managed by only one manager. Because the purpose language is statutory, the formation document carries no description of the business; that comes later, on the Statement of Information.

Processing and expedited service

The Secretary of State publishes a Current Processing Dates page giving, per filing type and submission method, the date of the requests now under review, and no turnaround estimate in days.

Four paid tiers appear on the Service Options page: 24-Hour Filing (Class C) at $350.00, online or drop-off in Sacramento, with a response guaranteed within 24 hours excluding weekends and holidays; Same Day Filing (Class B) at $750.00, online or drop-off, with the document due by 9:30 a.m. and the response by 4:00 p.m.; and 4-Hour Filing (Class A) and 24-Hour Preclearance at $500.00 each, drop-off only, with the 4-Hour tier open only to a document already precleared and approved. A drop-off adds a $15 special handling fee per filing request, retained whether the request is approved or rejected.

Naming a California LLC

The name must contain "limited liability company" or the abbreviation "L.L.C." or "LLC," and within it "Limited" may be abbreviated "Ltd." and "company" may be abbreviated "Co." (Corp. Code § 17701.08(a)). Section 17701.08(e) keeps other words out entirely: bank, trust, trustee, incorporated, inc., corporation, corp., insurer, insurance company, or other words suggesting the business of issuing insurance policies and assuming insurance risks. The name also must not be one the Secretary of State determines is likely to mislead the public, and must be distinguishable in the records from any LLC, any registered foreign LLC, and each reserved name (§ 17701.08(b)).

Names are checked only against names of like entities registered with the California Secretary of State, not against trademark or service mark registrations or fictitious business names. The California Business Search is preliminary, and compliance is reviewed when documents are submitted for filing. A name can be reserved for up to 60 days for $10.00, and the same applicant cannot hold it for two consecutive 60-day periods (§ 17701.09(a)).

Agent for service of process

Section 17701.13(a) requires an LLC to designate and continuously maintain in California both an office, which need not be a place of its activity in the state, and an agent for service of process, the term California uses. The agent may be an individual resident of California, or a corporation that has complied with Corporations Code § 1505 and whose capacity to act has not terminated; where a corporate agent is designated, no address for it is set forth in the instrument. Changing the agent, or the agent's address, requires filing a current Statement of Information with all the information required by § 17702.09(a). See the California registered agent page.

Statement of Information

Every LLC delivers a Statement of Information to the Secretary of State within 90 days after the filing of its original articles of organization, and biennially after that (§ 17702.09(a)). The fee is $20.00 and the filing is online only.

Section 17702.09(c) makes the applicable filing period the calendar month during which the original articles were filed plus the immediately preceding five calendar months, a six-month window: an LLC formed in January files between the first day of August and the last day of January. A reminder notice goes out approximately three months before the period closes, and failure to receive it does not exempt the LLC from filing.

The statement must state whether any manager, or any member of a member-managed LLC, has an outstanding final judgment, no appeal pending, from the Division of Labor Standards Enforcement or a court for violation of any wage order or provision of the Labor Code (§ 17702.09(a)(8)).

The Secretary of State provides a notice of delinquency; if no statement is filed within 60 days after that notice, a $250 penalty applies and the Secretary of State certifies the LLC's name to the Franchise Tax Board (Corp. Code §§ 17713.07(b), 17713.09). The Franchise Tax Board assesses the $250, final and due at the time of assessment, with no interest accruing on it (Rev. & Tax. Code § 19141). The notice must advise the LLC of its right to request relief for reasonable cause or unusual circumstances, and the Secretary of State may waive the penalty on that ground.

The Secretary of State will also suspend or forfeit an entity for not filing the statement, and an entity can be suspended by the Secretary of State and the Franchise Tax Board at the same time. A suspended or forfeited business loses its rights, powers and privileges to do business in California; reviving it means filing all past due tax returns, paying all past due balances, and filing a revivor request with the Franchise Tax Board.

What a California LLC may not do

An LLC may have any lawful purpose except the banking business, the business of issuing policies of insurance and assuming insurance risks, or the trust company business (Corp. Code § 17701.04(b)). Section 17701.04(e) also keeps a domestic or foreign LLC from rendering professional services, meaning services that may lawfully be rendered only under a license, certification or registration authorized by the Business and Professions Code, the Chiropractic Act or the Osteopathic Act, unless one of those, or the Yacht and Ship Brokers Act, authorizes a limited liability company to hold that license, certificate or registration.

Operating agreement

California does not require an LLC to adopt an operating agreement: § 17701.10(a) sets out what one governs, and § 17701.10(b) supplies the title's own rules for any matter the agreement leaves open. Where the agreement departs from those rules, writing matters: § 17701.10(d) allows certain provisions, among them §§ 17701.13, 17703.01 and 17704.08, to be varied only by a written operating agreement, and § 17701.10(e) allows fiduciary duties to be modified only in a written agreement with the informed consent of the members. See the operating agreement guide.

EIN

An EIN is issued by the Internal Revenue Service. The EIN guide covers the application.

Licenses, permits and fictitious business names

The Secretary of State does not issue licenses or permits for business entities, and points businesses to CalGold at www.calgold.ca.gov for permit, license and registration requirements from all levels of government. A business that intends to sell or lease tangible personal property subject to sales tax at retail is required to hold a seller's permit from the California Department of Tax and Fee Administration. Fictitious business names are filed with the county clerk or recorder where the business is located, under Business and Professions Code §§ 17900 through 17930.

Amendments and ending the LLC

Amendments use Form LLC-2 at $30.00, and a name change alone uses Form LLC-2-NA at the same $30.00. The Secretary of State charges no fee for a Certificate of Dissolution, a Certificate of Cancellation or a Short Form Cancellation Certificate, and all three are online only; since July 1, 2026 terminations require Full Access to the entity within bizfile Online. Corporations Code § 17707.08(b)(2)(B) requires the certificate of cancellation to state that a final annual tax return has been or will be filed with the Franchise Tax Board, and that cancellation filing is what stops the $800. An LLC that cancels within one year of organizing, using Short form cancellation (SOS Form LLC-4/8), is not subject to the $800 for its first tax year. See the California LLC dissolution page.

Frequently asked questions

Does a new California LLC owe the $800 annual tax in its first year?

Yes. The first-year exemption in Revenue and Taxation Code section 17941(g)(1)(A) reached only LLCs that organized, registered or filed with the Secretary of State on or after January 1, 2021 and before January 1, 2024. For taxable years beginning on or after January 1, 2027 and before January 1, 2030, the first-year amount is $400 under section 17941(g)(2).

How much does it cost to file California Articles of Organization?

$70.00. The Secretary of State lists the formation filing as online only on its LLC fee schedule and publishes no PDF Articles of Organization form.

How often does a California LLC file a Statement of Information?

Within 90 days after the articles of organization are filed, and biennially after that. The fee is $20 and the filing is online only. The filing period is the calendar month the original articles were filed plus the five calendar months immediately before it.

What happens if a California LLC misses its Statement of Information?

The Secretary of State provides a notice of delinquency. If no statement is filed within 60 days after that notice, a $250 penalty applies and the Secretary of State certifies the LLC's name to the Franchise Tax Board, which assesses and collects it. The Secretary of State will also suspend or forfeit the entity.

Can a California LLC provide licensed professional services?

No. Corporations Code section 17701.04(e) bars a domestic or foreign LLC from rendering professional services in California, unless the Business and Professions Code, the Chiropractic Act, the Osteopathic Act or the Yacht and Ship Brokers Act authorizes a limited liability company to hold that license, certificate or registration.