California is a huge market, but it is also one of the more expensive states to keep an LLC running. This guide to LLC formation in California explains the filings, the annual franchise tax and the rules that surprise many founders.
Forming the LLC is quick. However, ongoing obligations matter more. For example, California charges an annual minimum franchise tax, and some professions cannot use an LLC at all. Therefore, understand the full picture before you file.
Our attorneys form California LLCs and draft operating agreements at fixed prices. As a result, you get it right the first time.
Filing your California LLC
California LLCs are formed by filing Articles of Organization with the California Secretary of State. Filing is usually done online through the bizfile system. State fees change from time to time, so confirm the current amount when you file.
Next, you must file a Statement of Information within 90 days of formation. After that, it is due every two years. Missing it can lead to penalties and, eventually, suspension.
Name and agent
Your LLC name must be distinguishable from existing names and include "LLC" or a similar designation. In addition, you must appoint a registered agent with a California address. Our LLC Formation service, from $99, handles the filing and checklist.
The $800 annual franchise tax
California charges every LLC an annual minimum franchise tax of $800, whether or not the business makes money. A temporary first-year exemption applied to LLCs formed in 2021 through 2023, but it has ended. Consequently, new LLCs should budget for the tax from the start.
California also charges an additional LLC fee once total California income passes $250,000, on a sliding scale. Therefore, growing businesses pay more.
Doing business in California from elsewhere
Forming in another state does not avoid the tax if you do business in California. California applies "doing business" tests based on activity, property, payroll and sales. As a result, many out-of-state LLCs must register here and pay. Our foreign qualification service registers them.
Professions that cannot use an LLC
California does not allow LLCs to provide services that require a state professional license in many fields. For example, lawyers, doctors, accountants, architects and certain therapists generally cannot practice through an LLC. Instead, they typically use a professional corporation.
Consequently, licensed professionals should not form an LLC for their practice. Our corporation formation service sets up professional corporations instead. A business formation consultation confirms the right entity.
Your California operating agreement
Filing with the state creates the LLC. However, the operating agreement decides how it actually works. Without one, California's default LLC rules apply, and they may not match your deal.
What it should cover
A strong agreement sets ownership percentages and capital contributions. Moreover, it explains how profits and losses are allocated and when distributions are paid. In addition, it sets voting rules and decides whether the LLC is managed by its members or by managers.
Exits and disputes
Next, the agreement should plan for exits. For example, what happens if a member dies, divorces, becomes disabled or simply wants out? Similarly, how is a departing member's interest valued and paid? A buy-sell agreement can add detail here.
California notes
California allows member-managed and manager-managed LLCs. Furthermore, California's LLC statute permits broad flexibility in the operating agreement. Therefore, a custom agreement lets you replace the defaults with your actual deal.
Our LLC Operating Agreement service drafts a California-ready agreement, starting at $79.
Taxes, S corp elections and alternatives
By default, a single-member LLC is taxed like a sole proprietorship, and a multi-member LLC like a partnership. However, an LLC can elect S corporation tax treatment if it qualifies. This can reduce self-employment tax for profitable businesses.
California taxes S corporations at a 1.5% rate on net income, with an $800 minimum. Therefore, compare the numbers with an accountant. If you plan to raise venture capital, a Delaware C corporation registered in California may be better. Read our national guide to LLC formation and corporate structuring.
Flat fee LLC formation pricing in California
Our LLC Formation service starts at $99, plus state fees. Our operating agreement starts at $79. In addition, our annual report filing service keeps your Statement of Information on time.
Consequently, you can form and maintain a California LLC with clear, fixed costs. A business formation consultation helps if you are unsure which entity fits.
Our LLC Formation services in California
Every service below has a fixed price, is prepared by a qualified attorney and is delivered online — wherever you are in California. Additionally, you can upload evidence, message your attorney and track progress from your secure client dashboard.
LLC Formation Documents in California
Articles of organization, EIN guidance and initial resolutions (state fees extra).
Moreover, it is usually ready in 3 working days. Express delivery is also available. As a result, you can act before deadlines pass.
Order LLC Formation Documents — from $99 See what's included →
LLC Operating Agreement in California
Single- or multi-member operating agreement.
Moreover, it is usually ready in 3 working days. Express delivery is also available. As a result, you can act before deadlines pass.
Order LLC Operating Agreement — from $79 See what's included →
Corporation Formation (C-Corp / S-Corp) in California
Formation of your corporation: articles of incorporation, bylaws, initial resolutions, share issuance and S-election guidance.
It includes prepared by our US legal team for your state, based on your questionnaire answers and documents, word and PDF, ready to sign, send or file. Moreover, it is usually ready in 5 working days. Express delivery is also available. As a result, you can act before deadlines pass.
Order Corporation Formation (C-Corp / S-Corp) — $999 See what's included →
Business formation consultation in California
A confidential 45–60 minute phone or video consultation with a licensed US attorney about choosing and forming the right business entity. Get straight answers on your rights, options, risks and likely costs, and a clear plan for your next steps.
It includes 45–60 minute call with a licensed US attorney — phone, video or WhatsApp, upload documents beforehand so your attorney is prepared, your rights, options, risks and likely costs in plain English. Moreover, it is usually ready in 1 working day. Express delivery is also available. As a result, you can act before deadlines pass.
Order Business formation consultation — $299 See what's included →
Annual Report Filing in California
Preparation and filing of your company's annual report with the Secretary of State.
It includes prepared by our US legal team for your state, based on your questionnaire answers and documents, word and PDF, ready to sign, send or file. Moreover, it is usually ready in 2 working days. Express delivery is also available. As a result, you can act before deadlines pass.
Foreign Qualification Filing (per state) in California
Registering your company to do business in another state, including the certificate of good standing and registered agent.
It includes prepared by our US legal team for your state, based on your questionnaire answers and documents, word and PDF, ready to sign, send or file. Moreover, it is usually ready in 3 working days. Express delivery is also available. As a result, you can act before deadlines pass.
Order Foreign Qualification Filing (per state) — $250 See what's included →
Buy-Sell Agreement in California
A buy-sell agreement setting what happens to an owner's share on death, disability, divorce or exit — and how it is valued.
It includes prepared by our US legal team for your state, based on your questionnaire answers and documents, word and PDF, ready to sign, send or file. Moreover, it is usually ready in 7 working days. Express delivery is also available. As a result, you can act before deadlines pass.
LLC Formation across California — cities we serve
We work with clients in every part of California, entirely online. Therefore, it does not matter whether you live downtown or hours from the nearest courthouse. Your documents follow California law and your county's local practice. Choose your city below to see local details and prices.
- Los Angeles: LLC Formation Documents in Los Angeles · LLC Operating Agreement in Los Angeles · Corporation Formation (C-Corp / S-Corp) in Los Angeles
- San Diego: LLC Formation Documents in San Diego · LLC Operating Agreement in San Diego · Corporation Formation (C-Corp / S-Corp) in San Diego
- San Jose: LLC Formation Documents in San Jose · LLC Operating Agreement in San Jose · Corporation Formation (C-Corp / S-Corp) in San Jose
- San Francisco: LLC Formation Documents in San Francisco · LLC Operating Agreement in San Francisco · Corporation Formation (C-Corp / S-Corp) in San Francisco
- Fresno: LLC Formation Documents in Fresno · LLC Operating Agreement in Fresno · Corporation Formation (C-Corp / S-Corp) in Fresno
- Sacramento: LLC Formation Documents in Sacramento · LLC Operating Agreement in Sacramento · Corporation Formation (C-Corp / S-Corp) in Sacramento
- Long Beach: LLC Formation Documents in Long Beach · LLC Operating Agreement in Long Beach · Corporation Formation (C-Corp / S-Corp) in Long Beach
- Oakland: LLC Formation Documents in Oakland · LLC Operating Agreement in Oakland · Corporation Formation (C-Corp / S-Corp) in Oakland
- Bakersfield: LLC Formation Documents in Bakersfield · LLC Operating Agreement in Bakersfield · Corporation Formation (C-Corp / S-Corp) in Bakersfield
- Anaheim: LLC Formation Documents in Anaheim · LLC Operating Agreement in Anaheim · Corporation Formation (C-Corp / S-Corp) in Anaheim
- Riverside: LLC Formation Documents in Riverside · LLC Operating Agreement in Riverside · Corporation Formation (C-Corp / S-Corp) in Riverside
- Santa Ana: LLC Formation Documents in Santa Ana · LLC Operating Agreement in Santa Ana · Corporation Formation (C-Corp / S-Corp) in Santa Ana
- Irvine: LLC Formation Documents in Irvine · LLC Operating Agreement in Irvine · Corporation Formation (C-Corp / S-Corp) in Irvine
- Stockton: LLC Formation Documents in Stockton · LLC Operating Agreement in Stockton · Corporation Formation (C-Corp / S-Corp) in Stockton
- Chula Vista: LLC Formation Documents in Chula Vista · LLC Operating Agreement in Chula Vista · Corporation Formation (C-Corp / S-Corp) in Chula Vista
- Fremont: LLC Formation Documents in Fremont · LLC Operating Agreement in Fremont · Corporation Formation (C-Corp / S-Corp) in Fremont
- San Bernardino: LLC Formation Documents in San Bernardino · LLC Operating Agreement in San Bernardino · Corporation Formation (C-Corp / S-Corp) in San Bernardino
- Modesto: LLC Formation Documents in Modesto · LLC Operating Agreement in Modesto · Corporation Formation (C-Corp / S-Corp) in Modesto
- Oxnard: LLC Formation Documents in Oxnard · LLC Operating Agreement in Oxnard · Corporation Formation (C-Corp / S-Corp) in Oxnard
- Pasadena: LLC Formation Documents in Pasadena · LLC Operating Agreement in Pasadena · Corporation Formation (C-Corp / S-Corp) in Pasadena
- Santa Clarita: LLC Formation Documents in Santa Clarita · LLC Operating Agreement in Santa Clarita · Corporation Formation (C-Corp / S-Corp) in Santa Clarita
- Palm Springs: LLC Formation Documents in Palm Springs · LLC Operating Agreement in Palm Springs · Corporation Formation (C-Corp / S-Corp) in Palm Springs
More California services
LLC Operating Agreement in California · Corporation Formation (C-Corp / S-Corp) in California · Business formation consultation in California · Annual Report Filing in California · Foreign Qualification Filing (per state) in California · Buy-Sell Agreement in California. See all legal services in California.
Nearby states
Moving between states, or is the other party elsewhere? We also cover LLC Formation Documents in Oregon, LLC Formation Documents in Nevada, LLC Formation Documents in Arizona. See every location we cover.
Frequently asked questions
How much does it cost to form an LLC in California?
Our attorney-prepared formation starts at $99 plus the state filing fee. Remember the $800 annual minimum franchise tax, which applies even if the LLC earns nothing.
Do California LLCs pay $800 every year?
Yes. Every LLC doing business in California owes the $800 annual minimum franchise tax, plus an additional fee once California income exceeds $250,000.
Can a doctor or lawyer form an LLC in California?
Generally no. California does not allow many licensed professionals to practice through an LLC; they typically use a professional corporation.
What is a Statement of Information?
A required filing listing the LLC's managers, address and agent, due within 90 days of formation and every two years after that.
Do you form LLCs anywhere in California?
Yes. We form California LLCs and draft operating agreements for businesses statewide.
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This guide is general information, not legal advice for your situation. Every case is different — speak to a qualified attorney before you act.