Form an LLC in California.

California LLC fees, line by line

Component	Cost / Rule	Note
Articles of Organization filing fee	$70	One-time charge to register the LLC with the state.
Statement of Information (biennial)	$20 every 2 years	Due within 90 days of formation, then every two years. Late or missed filings bring a $250 penalty and can lead to suspension.
CA Franchise Tax (min)	$800 / year	Minimum due regardless of revenue. Most states with a franchise tax scale it with revenue or capital above this floor.
Registered agent	Required	Every state requires a registered agent. You can be your own RA in your home state at no cost; commercial services run $35–$300/yr.
Expedited filing	Available	Typical add-on $50–$100 for 1–3 day turnaround.

CA Franchise Tax (min) in California

California charges a minimum ca franchise tax (min) of $800/year regardless of revenue. This is a recurring annual cost — often larger than the one-time filing fee — so factor it into your decision before forming in California.

Should you form in this state if you don't live here?

For most operators, the answer is no. An LLC pays state income tax wherever it operates, not where it's formed. Forming in California while doing business in another state means paying both states' fees plus a foreign-qualification fee in your operating state. Real reasons to form in a non-home state: pure IP holdcos, real estate holdcos in the property state, asset-protection structures, or non-US residents with no US nexus. Full breakdown of when forming out-of-state pays off →

Forming an LLC in California

California's Secretary of State oversees LLC formation through the Business Programs Division. Filing is conducted exclusively online via the California Secretary of State's digital portal or by mail to Sacramento; paper-only submission is no longer supported for online-capable applicants. Online filings are processed within 1-2 business days if submitted correctly; mail filings take 5-10 business days. California has no newspaper publication requirement. That rule exists in New York, Arizona, and Nebraska, not here, so once the Articles of Organization are accepted you owe the state nothing further until the initial Statement of Information comes due within 90 days of formation.

A name search is required before filing. California's online entity search is free and real-time. The LLC name must be distinguishable from existing entities and must include "LLC," "L.L.C.," or "Limited Liability Company." Name reservation is available for 60 days for a $10 fee. Registered agent requirements apply: every California LLC must have a registered agent with a California street address. The agent receives service of process and official documents. California's statute allows great flexibility in LLC structure and does not mandate specific manager qualifications or member restrictions. Operating agreements are not filed with the state but are strongly recommended for any multi-member LLC to clarify profit sharing, voting rights, and dispute resolution procedures.

California imposes a unique $800 annual LLC Franchise Tax, which is due the first year of formation and every year thereafter, regardless of profits or revenue. This is a flat minimum fee that applies to all active LLCs in California, even if the business has generated no revenue. The Articles of Organization filing fee is $70. Add the first-year franchise tax of $800, the $20 initial Statement of Information, and a registered agent service around $99, and total first-year cost typically lands near $989 before any professional fees. Even at that figure, California sits among the more expensive states for LLC formation. Multi-year projections for a California LLC assume annual franchise tax of $800 every year the LLC is active and in good standing.

California's regulatory environment is more complex than many states. The state imposes additional compliance obligations including the biennial Statement of Information (due within 90 days of formation, then every two years during the filing window tied to the formation anniversary), sales tax registration for goods-selling businesses, and payroll tax registration if hiring employees. Failure to file the Statement of Information on time or pay the franchise tax on time results in penalties and potential administrative dissolution. The state's tax and regulatory structure makes California formation attractive to established businesses anticipating significant revenue; for early-stage or part-time ventures, the annual $800 minimum may be a disproportionate burden.

State-specific tax considerations

California's combined state and local income tax rate is among the highest in the nation. The state imposes a graduated income tax ranging from 1% to 13.3% at the top bracket, plus net investment income tax of 3.8% above certain thresholds. LLCs are pass-through entities; income flows to members' personal returns at these rates. Multi-member LLCs default to partnership taxation unless an election is made. The California $800 annual LLC Franchise Tax is a flat fee due every year an LLC is registered and in good standing, regardless of profitability. This is distinct from income tax and is non-negotiable for active LLCs. Sales tax registration is required immediately upon nexus for goods-selling businesses; California's statewide rate is 7.25%, with district taxes adding 0.5% to 2.25%, for totals of 7.25% to 9.5% depending on location.

Payroll taxes are mandatory once the LLC has employees. California's employment tax rate is among the highest in the nation, and the state imposes strict payroll withholding and unemployment insurance requirements. California also imposes employer-paid payroll taxes on top of employee withholding. Additional considerations: California has aggressive sales tax nexus rules and actively pursues out-of-state sellers with California customers for sales tax registration. Multi-state LLCs often find California's tax exposure significant relative to the compliance cost. The state's $800 annual franchise tax, combined with high income tax rates and stringent payroll and sales tax enforcement, makes California formation most practical for established, revenue-generating businesses rather than startups or side ventures.

Frequently asked questions

Sources & verification

• Official: California Secretary of State — business filings
• IRS — Limited Liability Company guidance

Last verified: pending. Fees can change between legislative sessions — the linked official source above is the canonical record.

Compare California with other states

See the full ranking — best states to form an LLC →   Compare formation services →