Limited liability company Business type

Overview

A limited liability company (LLC) blends partnership and corporate structures. You can form an LLC to run a business or to hold assets. The owners of an LLC are members. LLCs protects its members against personal liabilities.

An LLC will be either:

  • A disregarded entity (for federal purposes), if it has only one member
    • Single member limited liability company (SMLLC)
  • A partnership, if it has more than one owner
    • Limited liability partnership
    • Limited liability limited partnership
    • Series limited liability company
  • An LLC being taxed as a corporation

An LLC must have the same classification for both California and federal tax purposes.

Open an LLC

To register or organize an LLC in California, contact the Secretary of State (SOS):

Website
California Secretary of State
Phone
(800) 657-5448
Mail
California Secretary of State
Document Filing Support
PO Box 944228
Sacramento CA 94244-2280

Visit Limited Liability Company Filing Information (FTB 3556) for more information.

Annual Tax

Every LLC that is doing business or organized in California must pay an annual tax of $800.

This yearly tax will be due, even if you are not conducting business, until you cancel your LLC.

  • You have until the 15th day of the 4th month from the date you file with the SOS to pay your first-year annual tax.
    • Example: You form a new LLC and register with SOS on June 18, 2019. Your annual LLC tax will be due on September 15, 2019 (15th day of the 4th month)
  • Your subsequent annual tax payments will continue to be due on the 15th day of the 4th month of your taxable year.

The annual tax payment is due with LLC Tax Voucher (FTB 3522).

Paying your annual tax

Online
Bank account (Web Pay)
Credit card
Mail
Franchise Tax Board
PO Box 942857
Sacramento CA 94257-0631

Use FTB 3522 when paying by mail.

Exceptions to the first year annual tax

LLCs are not subject to the annual tax and fee if both of the following are true:

  • They did not conduct any business in California during the tax year
  • Their tax year was 15 days or fewer

Short form cancellation

If you cancel your LLC within one year of organizing, you can file Short form cancellation (SOS Form LLC-4/8) with the SOS. Your LLC will not be subject to the annual $800 tax for its first tax year.

LLC fee

If your LLC will make more than $250,000, you will have to pay a fee. LLCs must estimate and pay the fee by the 15th day of the 6th month, of the current tax year.

California income rounded
If the total California income rounded to the nearest whole dollar is: The fee amount is:
$250,000 - $499,999 $900
$500,000 - $999,999 $2,500
$1,000,000 - $4,999,999 $6,000
$5,000,000 or more $11,790

Use Estimated Fee for LLCs (FTB 3536), to remit the estimated fee payment.

Underpayment

If you do not make your estimated LLC fee payment by the original return due date, you will be subject to penalties and interest. Visit Due dates for businesses for more information.

Filing requirements

If your LLC meets one or more of the following conditions:

Then your LLC must:

For detailed information on LLC due dates, visit Due dates for businesses.

Foreign non-registered LLC

If you are a foreign non-registered LLC that meets all of the following:

  • Treated as a partnership
  • Has California source income
  • Not doing business in California

Then your LLC must:

Keep your LLC active

To keep your LLC active you must:

  1. File the Statement of Information with the SOS
  2. File and pay your state income taxes

Suspended LLCs

We do not grant automatic extensions to file for suspended LLCs. Visit My business is suspended for more information.

SOS penalty

SOS imposes a $250 penalty if you do not file your Statement of Information. We collect the penalty on behalf of the SOS.

Cancel your LLC

Registered with SOS

If you close your business, you must file the required paperwork with the Secretary of State and us.

With us you must:

  • File your final current year tax return. Check the applicable Final Return box on the first page of the return
  • Stop doing business in California after the final taxable year

Visit Guide to Dissolve, Surrender, or Cancel a California Business Entity (FTB Publication 1038) for more information.

Not registered with SOS

  • File your final current year tax return. Check the applicable Final Return box on the first page of the return
  • Stop doing business in California after the final taxable year

Apportionment and allocation

You may have California source income if you sell goods to California customers or perform a service to customers who received the benefit of that service in California or own an intangible used in California. Visit Apportionment and allocation for more information.

Contact us about LLCs

Phone
(800) 852-5711
(916) 845-6500 (outside the U.S.)
Weekdays, 7 AM to 5 PM
Chat
Sign into MyFTB to chat
Weekdays, 7 AM to 5 PM
Mail
Franchise Tax Board
PO Box 942840
Sacramento CA 942840-0040