How to Start an LLC in California

Last Updated: by the TRUiC Team

Starting an LLC in California is Easy

To start a California LLC you'll need to file your Articles of Organization with the California Secretary of State, which costs $70 online. You can apply online, in person, or by mail or fax. The Articles of Organization are the legal formation documents that officially creates your California limited liability company.

Follow our step-by-step How to Start an LLC in California guide to get started today. You can learn more about LLCs and their benefits in our What is an LLC guide. To learn how to form an LLC in Spanish, read our Cómo crear una LLC en California guide.

For more information on how to form a new LLC in any state, visit our How to Start an LLC guide.

STEP 1: Name Your California LLC

Choosing a company name is the first and most important step in starting your LLC. Be sure to choose a name that complies with California naming requirements and is easily searchable by potential clients.

1. Follow the naming guidelines for a California LLC:

  • Your name must include the phrase “limited liability company,” or one of its abbreviations or words: “LLC, L.L.C., Limited, Ltd., Company or Co.”
  • Your name cannot include words that could confuse your LLC with a government agency (FBI, Treasury, State Department, etc.).
  • Restricted words (e.g. Bank, Attorney, University) may require additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your LLC.
  • For a complete list of naming rules in California, you can read California's Code of Regulations.

2. Is the name available in California? Make sure the name you want isn't already taken by doing a business name search on the State of California website.

3. Is the URL available? It is a good idea that you check online to see if your business name is available as a web domain. Even if you don't plan to make a business website today, you may want to buy the URL in order to prevent others from acquiring it.

Find a Domain Now

Now that you have verified your name and secured the URL you may select a professional business formation service to complete the LLC formation process for you. We recommend using one of these professional services:

STEP 2: Choose a Registered Agent in California

You are required to appoint a California Agent for Service of Process for your California LLC. An Agent for Service of Process is more commonly known as a Registered Agent in other states.

What is an Agent of Service of Process? An Agent Of Service Of Process is a person or business entity responsible for receiving important tax forms, legal documents, notice of lawsuits, and official government correspondence on behalf of your business. Think of your registered agent as your business' point of contact with the state.

Who can be an Agent Of Service Of Process? An Agent of Service of Process must be a full-time resident of California or a corporation, such as an Agent of Service of Process, authorized to conduct business in the state of California. You may elect an individual within the company including yourself.

Recommended: Northwest provides the first year of registered agent service free with LLC formation ($29 + State Fees)

STEP 3: File Your California LLC Articles of Organization

To register your California LLC, you'll need to file Form LLC-1 - Articles of Organization with the California Secretary of State. You can apply online, by mail, or in person.

Now is a good time to determine whether your LLC will be member-managed vs. manager-managed.

Note: California has waived LLC formation fees from July 1, 2022, to June 30, 2023.

File the Articles of Organization

OPTION 1: File Form LLC-1 Online With the State of California

File Online

- OR -

OPTION 2: File by Mail or In Person

Download Form

State Filing Cost: $70 when filing online or by mail (Nonrefundable)

Mail to:
Secretary of State
Business Entities Filings
P.O. Box 944228
Sacramento, CA 94244

Submit in-person:
1500 11th St.
Sacramento, CA 95814
Mon-Fri. 8 a.m. to 5 p.m.

Note (if filing in-person): Articles filed in person at the Secretary of State Office in Sacramento are subject to an additional $15 counter drop-off fee. This provides priority processing over applications submitted by mail. The filing counter is on the 3rd floor.

For help with completing the form, visit our California Articles of Organization guide.

California LLC Formation Document

If you’re expanding your existing LLC to the State of California, you'll need to form a Foreign LLC.

STEP 4: File the Initial Statement of Information

All California LLCs are required to file an Initial Statement of Information (Form LLC-12) with the California Secretary of State within 90 days of formation. This can be done in-person, by mail, or on the Secretary of State website.

File the Initial Statement of Information

OPTION 1: File the Statement Online through the California Secretary of State

File Online

- OR -

OPTION 2: File the Statement by mail or in-person

Download Form

Fee: $20 (Nonrefundable)

Mail to:
Secretary of State, Statement of Information Unit
P.O. Box 944230
Sacramento, CA 94244

Submit In-Person:
California Secretary of State Sacramento Office
1500 11th Street
Sacramento, CA 95814

STEP 5: Create a California LLC Operating Agreement

An operating agreement is required when forming an LLC in California.

What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.

Why are operating agreements important? A comprehensive operating agreement ensures that all business owners are on the same page and reduces the risk of future conflict.

For more information on operating agreements, read our California LLC operating agreement guide.

Recommended: Download a template or create a Free Operating Agreement using our tool.

STEP 6: Get a California LLC EIN

What is an EIN? EIN stands for Employer Identification Number. EINs are a nine-digit number assigned by the Internal Revenue Service (IRS) to help identify businesses for tax purposes. It is essentially a Social Security number for a business.

An EIN is sometimes referred to as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN).

Why do I need an EIN? An EIN is required to:

  • Open a business bank account
  • File and manage federal and state taxes
  • Hire employees

What if I already have an EIN for my sole proprietorship? The IRS requires that a sole proprietorship gets a new EIN when converting to an LLC.

Where do I get an EIN? You can get an EIN for free from the IRS. Getting an EIN is an easy process that can be done online or by mail.

FOR INTERNATIONAL EIN APPLICANTS: You do not need a SSN to get an EIN. For more information, read our How to Get an EIN as a Foreign Person guide.

Get an EIN

Option 1: Request an EIN from the IRS

Apply Online

- OR -

Option 2: Apply for an EIN by Mail or Fax

Download Form

Mail to:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

Fax: (855) 641-6935

Fee: Free

Frequently Asked Questions

What is an LLC?

LLC is short for Limited Liability Company. It is a simple business structure that offers more flexibility than a traditional corporation while providing many of the same benefits. Read What is a Limited Liability Company? for more information.

Watch our 2 minute video: What is an LLC?

How do I name my California LLC?

You must follow the California LLC naming guidelines when choosing a name for your LLC:

  • Include the phrase "limited liability company" or one of its abbreviations (LLC or L.L.C.).
  • Do not use words that could confuse your business with a government agency (FBI, State Department, CIA, etc.).
  • Receive the proper licensing when using the words such as lawyer or doctor.

If you are having trouble coming up with a name for your LLC use our LLC Name Generator. That will not only find a unique name for your business but an available URL to match.

After you get your business name, your next step is getting a unique logo. Get your unique logo using our Free Logo Generator.

Do I need to get a DBA or Trade Name for my business?

Most LLCs do not need a DBA. The name of the LLC can serve as your company’s brand name and you can accept checks and other payments under that name as well. However, you may wish to register a DBA if you would like to conduct business under another name.

To learn more about DBAs in your state, read our How to File a DBA guide.

Can I be my own Registered Agent?

Yes. You or anyone else in your company can serve as the registered agent for your LLC. Read about being your own registered agent.

What is the processing time to form my LLC in California?

5 business days online or by mail, but may be expedited for an additional fee.

4–Hour - $500.00

Same Day - $750.00

24–Hour - $350.00

To learn more, go to our How Long Does it Take to Form an LLC in California guide.

What is the difference between a domestic California LLC and foreign LLC?

An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. Normally when we refer to an LLC we are actually referring to a domestic LLC. A foreign LLC must be formed when an existing LLC wishes to expand its business to another state. If you are filing as a foreign California LLC read our guide for more information.

Do I need to file my operating agreement with the State of California?

No. The operating agreement is an internal document that you should keep on file for future reference. However, many states do legally require LLCs to have an operating agreement in place.

How do I get an EIN if I don’t have a Social Security number?

An SSN is not required to get an EIN. You can simply fill out IRS Form SS-4 and leave section 7b blank. Then call the IRS at 267-941-1099 to complete your EIN application. Read our guide for international EIN applicants.

What tax structure should I choose for my LLC?

When you get an EIN, you will be informed of the different tax classification options that are available. Most LLCs elect the default tax status.

However, some LLCs can reduce their federal tax obligation by choosing the S corporation (S corp) status. To learn more, read our LLC vs. S Corp guide.

Do I need an EIN for my LLC?

All LLCs with employees, or any LLC with more than one LLC member, must have an EIN. This is required by the IRS.

Learn why we recommend always getting an EIN and how to get one for free in our Do I Need an EIN for an LLC guide.

What is the California Franchise Tax?

There is a Franchise Tax for each LLC formed in California which varies depending upon your LLC’s income. Read about California's biennial report and franchise tax.

What is the minimum wage in California?

The statewide minimum wage in California is $15.50 per hour.

How often do I need to pay employees?

In California, wages are required to be paid at least twice during each calendar month on days designated as regular paydays by the employer.

Steps to start an L L C in California

Considering Using an LLC Formation Service?

We reviewed and ranked the top 5 LLC formation services.
Find out which is best for you.

Best LLC Services

Important Steps After Forming an LLC

Separate Your Personal and Business Assets

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your California LLC is sued. In business law, this is referred to as piercing the corporate veil.

You can start protecting your LLC in California with these steps:

1. Opening a business checking account:

  • Separates your personal assets from your company's assets, which is necessary for personal asset protection.
  • Makes accounting and tax filing easier.

Need help finding your EIN for your bank application? Visit our EIN Lookup guide for help.

Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.

2. Getting a business credit card:

  • Helps categorize and separate all business expenses for end-of-year tax purposes.
  • Helps build your business credit score — an essential step toward getting a line of credit or business loan in the future.
  • Allows you to keep track of department expenses by issuing multiple cards (with multiple budgets) to your employees.

For a closer look at business credit cards and their benefits, check out our review of the best small business credit cards.

Recommended: Visit Divvy to apply for their business credit card and build your business credit quickly.

3. Hiring a business accountant:

  • Prevents your business from overpaying on taxes while helping you avoid penalties, fines, and other costly tax errors
  • Makes bookkeeping and payroll easier, leaving you with more time to focus on your growing business 
  • Manages your business funding more effectively, discovering areas of unforeseen loss or extra profit

Recommended: Find out how much you could be saving today by trying our recommended accounting service.

For more business accounting tools, read our guide to the best business accounting software.

Get Business Insurance for Your LLC

Business insurance helps you manage risks, reduce personal liability, and focus on growing your business. The most common types of business insurance are:

  • General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.
  • Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers claims of malpractice and other business errors.
  • Workers' Compensation Insurance: A type of insurance that provides coverage for employees’ job-related illnesses, injuries, or deaths.

Ready to Protect Your Business?

Get the protection you need with a dedicated small business insurance provider. Find out how much insurance will cost you by getting a quote from our partners at Next Insurance.

Read our review of the best small business insurance companies.

Create Your Website

Creating a website is an important step in legitimizing your business. Every business needs a website if you want your customers to find you.

Recommended: Get started today using our recommended website builder or check out our review of the Best Website Builders.

Send Out a Press Release

Press releases are among the easiest and best ways to promote your business. They are also one of the most cost-effective strategies as they:

  • Provides publicity
  • Establish your brand presence on the web
  • Improve your website’s search engine optimization (SEO), driving more customers to your website
  • Are a one-time cost in terms of effort and money
  • Have long-lasting benefits

Read our review of the best press release services.

Keep Your Company Compliant

California Business Permits & Licenses

To operate your LLC in California you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc.

The details of business licenses and permits vary from state to state. Make sure you read carefully. Don't be surprised if there are short classes required as well.

Fees for business licenses and permits will vary depending on what sort of license you are seeking to obtain.

Find out how to obtain necessary California business licenses and permits for your LLC or have a professional service do it for you:

Recommended: If you are a first-time entrepreneur, consider having a professional service research your business’s licensing requirements. Read our best business license services review on Startup Savant.

California LLC Tax Filing Requirements

Depending on the nature of your business, you may be required to register for one or more forms of state tax:

Sales Tax

If you are selling a physical product, you’ll typically need to register for a seller's permit through the state of California’s website. This certificate allows a business to collect sales tax on taxable sales.

Sales tax, also called "Sales and Use Tax," is a tax levied by states, counties, and municipalities on business transactions involving the exchange of certain taxable goods or services.

Read our California sales tax guide to find out more.

Employer Taxes

If you hire employees, you will need to register for California Employer Taxes, which include Employee Withholding Tax, Unemployment Insurance Tax, and Disability Insurance through the California Payroll website.

Register for California State Taxes

Sales Tax | Employer Tax

Federal LLC Tax Filing Requirements

Most LLCs will need to report their income to the IRS each year using:

How you pay yourself as an LLC owner will also affect your federal taxes. Visit our guide to learn more about how to pay yourself from your LLC.

Read our LLC Tax Guide to learn more about federal income taxes for LLCs.

File Your California LLC Statement of Information

LLCs in California are required to file a biennial report, also known as the Statement of Information, with the California Secretary of State. This must be submitted on paper, by mail or in person (drop off).

File your Biennial Report

OPTION 1: File Online with the Secretary of State

File Online

- OR -

OPTION 2A: File form LLC-12NC by mail or in-person if none of your business information has changed

Download Form

- OR -

OPTION 2B: File form LLC-12 by mail or in-person if some of your business information has changed

Download Form

Fee: $20 for each biennial statement (Nonrefundable)

Due Date: Every second year by the end of the month in which your LLC was formed.

Late Filings: California charges a $250 penalty for failure to file on time.

California LLCs are required to pay an annual Franchise Tax. You can do this online or by mail.

Avoid Automatic Dissolution

LLCs may face fines and even automatic dissolution when they miss one or more state filings. When this happens, LLC owners risk loss of limited liability protection. A quality registered agent service can help prevent this outcome by notifying you of upcoming filing deadlines, and even submitting reports on your behalf for an additional fee.

Recommended: Northwest offers a reliable registered agent service and excellent customer support. Learn more by reading our Northwest Review.

California LLC Annual Tax and LLC Fee

All LLCs doing business in the state of California must pay a flat annual tax, even if they didn’t conduct business during that tax year. This is first due on the 15th day of the fourth month following your LLC’s formation date.

Pay Your California LLC Annual Tax

OPTION 1: Pay Online to the California Franchise Tax Board

Pay Online

- OR -

OPTION 2: Pay by Mail

Download Form

Fee: $800

Mailing Address:
Franchise Tax Board
P.O. Box 942857
Sacramento, CA 94257-0531

Due Date: Due by the 15th day of the fourth month of your LLC’s taxable year.

First-Year Filings: LLCs that start with tax years between January 1 2021 and January 1 2024 do not have to pay the annual tax in their first year. 

Additionally, LLCs that make more than $250,000 in California income each year must pay an LLC fee. This fee increases depending on the amount of income:

  • $250,000–$499,999: $900
  • $500,000–$999,999: $2,500
  • $1 million–$4.99 million: $6,000
  • $5 million+: $11,790

LLCs that make less than $250,000 do not have to pay the fee for that year.

Pay Your California LLC Fee

Pay LLC Fee by Mail to the California Franchise Tax Board

Download Form

Fee: $900+

Mailing Address:
Franchise Tax Board
P.O. Box 942857
Sacramento, CA 94257-0531

Due Date: Due by the 15th day of the sixth month of your LLC’s taxable year.

Penalties: If your LLC underpays the LLC fee, you must pay 10% of the amount of the underpayment in addition to the fee.

Hiring Employees

If you plan to hire employees for your California LLC, stay compliant with California law by following these steps:

For more information, check out California's Tax Service Center.

Recommended: Check out our Hiring for your Small Business Guide for resources like sample job descriptions, payroll service reviews, and more.

Gusto has a great payroll service for small businesses

Small Business Resources

Get Help Starting a Business in California

We understand that creating an LLC and getting your business up and running comes with many challenges. To help you succeed, we compiled the best local resources in every major metro area in California. You can get free assistance in the following areas:

Fresno | Irvine | Los Angeles | Oakland | Sacramento | San Diego | San Francisco | San Jose

State of California Quick Links

More California LLC Information

California Foreign LLCs

Forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in California, you will need to register as a foreign LLC. This can be done by mail.

Register as a Foreign LLC in California

File by Mail with the California Secretary of State

Download Form

Fee: $70 (Nonrefundable)

Mail to:
Secretary of State, Business Entities Filings Unit
P.O. Box 944228
Sacramento, CA 94244

How to Obtain a Certificate of Good Standing in California

A Certificate of Good Standing, known in California as a Certificate of Status, verifies that your LLC in California was legally formed and has been properly maintained. Several instances where you might need to get one include:

  • Seeking funding from banks or other lenders
  • Forming your business as a foreign LLC in another state
  • Obtaining or renewing specific business licenses or permits

To order a Certificate of Status in California, you must complete the Business Entities Records Request Form. You can submit this form either in person at the Secretary of State, or by mail.

Order a Certificate of Good Standing

Request a Certificate by Mail or In-Person

Download Form

Fee: $5, payable to the California Secretary of State (Nonrefundable)

Mail to:
Secretary of State
BE Certification and
P.O. Box 944260
Sacramento, CA 94244

Submit in-person:
1500 11th St.
3rd Floor, Room 380
Sacramento, CA 95814
Mon-Fri. 8 a.m. to 5 p.m.

How to Dissolve an LLC in California

If at any point in the future you no longer wish to conduct business with your LLC, it is important to officially dissolve it. Failure to do so in a timely fashion can result in tax liabilities and penalties, or even legal trouble. To dissolve your California LLC, there are two broad steps:

  • Close your business tax accounts
  • File the Articles of Dissolution

When you are ready to dissolve your LLC, follow the steps in our California LLC Dissolution Guide.

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