Last Updated: February 16, 2024, 12:06 pm by TRUiC Team


How Much Does It Cost to Start an LLC in California?

The cost to start an LLC (limited liability company) online in California is $70. This fee is paid to the California Secretary of State when filing the LLC’s Articles of Organization.

This California LLC Fees guide will walk you through all costs, besides the California LLC fee for limited liability companies.

We recommend Northwest ($29 + State Fees) to help form your LLC.

How Much Does an LLC Cost in California?

California LLC Online Filing Fee: $70

It's currently $70 to file your LLC's Articles of Organization online with the California Secretary of State.

For a look at LLC costs in every state, read our other Cost to Start an LLC and How to Form an LLC guides.

California Statement of Information Fee: $20

California LLCs must file a biennial report with the Secretary of State. This is done by filing either a Statement of Information (Form LLC-12) or a Statement of Information No Change (Form LLC-12NC) with the Secretary of State. The fee is $20.

California Annual Tax: $800

All LLCs that do business in California must pay the annual $800 tax. 

First-Year Annual Tax: Businesses whose first tax year was fewer than 15 days and did not conduct any business (generate net income) in California during that time are exempt from paying the first year of annual tax.

Also per California's revenue and taxation code any LLC registered before January 1, 2024, are also exempt from the first year annual tax.

California LLC Fee: Varies

LLCs with annual revenue over $250,000 must pay a California LLC franchise tax of $900. The fee is higher for LLCs with more revenue.

You can file and pay your franchise tax online through the California Franchise Tax Board.

California Initial Report Fee: $20

California LLCs must file an initial report with the Secretary of State within 90 days of their registration date. This is done by filing a Statement of Information (Form LLC-12) with the Secretary of State. The fee is $20.

Cost to Form a Foreign LLC in California

If you already have an LLC that is registered in another state and you’d like to expand your business into California, you’ll need to register your LLC as a foreign LLC in California.

The cost for registering a California foreign LLC is $70. You can register a foreign LLC in California by filing an Application to Register a Foreign Limited Liability Company (Form LLC-5).

Optional LLC Formation Costs

There are optional fees associated with LLC formation:

LLC Name Reservation

Reserve your name for up to 60 days prior to LLC formation by filing the Name Reservation Request Form and paying the $10 filing fee.

Fictitious Business Name

Fees vary by county/city for this process.

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Ready to Start Your California LLC?

Read our LLC formation services review to choose the best service for you.

How to Register a California LLC Yourself

Creating your own LLC in California is something you can do yourself. Just follow these nine steps. 

These simple instructions will guide you through the process of registering your California LLC, making it easy and hassle-free.

Recommended: Using an LLC formation service like Northwest ($29 + State Fees) saves time and ensures compliance. Besides the low cost, we like their streamlined approach and excellent customer service.

Nine Basic Steps to Start an LLC in California

Step 1: Name Your California LLC
Step 2: Choose an Agent for Service of Process
Step 3: File the Articles of Organization
Step 4: File the Initial Statement of Information
Step 5: Create an Operating Agreement
Step 6: Get an EIN
Step 7: File the Statement of Information
Step 8: Submit Annual Taxes
Step 9: Keep Your Company Compliant

Step 1: Name Your California LLC

When you name your California LLC, you’ll need to choose a name that:

  1. Is available for use in the state of California
  2. Meets California naming requirements
  3. Is available as a web domain

Recommended: Visit our Start an LLC in California guide for detailed naming rules and instructions for registering a business name in California.

Not sure what to name your business? Check out our How to Name a Business guide and free LLC Name Generator.

We recommend that you check online to see if your business name is available as a web domain. Even if you don't plan to create a business website today, you may want to buy the URL in order to prevent others from acquiring it.

Find a Domain Now

Step 2: Choose an Agent for Service of Process

All LLCs in California must appoint an agent for service of process. An agent for service of process primarily acts as your LLC’s main point of contact with the state. But most importantly, they are responsible for accepting service of process in the event your business is sued.

Your California Agent for Service of Process must:

  • Be at least 18 years or older
  • Have a physical address in California
  • Be available during normal business hours to accept service of process

Get Free Registered Agent Services

Form an LLC with Northwest Registered Agent to get one year of registered agent services free of charge.

Step 3: File the Articles of Organization

The California Form LLC-1 - Articles of Organization is a document that is filed with the California Secretary of State to form an LLC. The fee for filing the Articles of Organization is $70.

For detailed instructions for completing the Articles of Organization, visit our How to File the California Articles of Organization guide.

File the California Articles of Organization

OPTION 1: File Online With the California Secretary of State

File Online

- OR -

OPTION 2: File Form LLC-1 by Mail or In Person

Form LLC-1

State Filing Cost: $70 ($85 for in-person filing)

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

Office Address:
1500 11th St.
Sacramento, CA 95814

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's 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 an Operating Agreement

California LLCs are required to create and maintain an operating agreement.

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.

Step 6: Get an EIN

What is an EIN? An EIN or Employer Identification Number is a nine-digit number issued by the Internal Revenue System (IRS) to identify a business for tax reporting purposes. An EIN is essentially a Social Security number (SSN) for your company.

Why do I need an EIN? An EIN number is required for the following:

How to Start an LLC Tip Icon

Free EIN: You can get an EIN from the IRS website (free of charge) after forming your business.

Step 7: File 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. 

Statements of Information can be submitted online, by mail, or in person along with the $20 filing fee.

This form must be submitted every second year by the end of the month in which your LLC was formed (e.g., if you form your LLC on May 2, your Statement of Information would be due by May 31).

Step 8: Submit Annual Taxes

LLCs in California must regularly submit an annual tax and an annual LLC fee to the California Franchise Tax Board. This is in addition to paying federal income tax. Some California LLC expenses may be tax deductible.

LLC Annual Tax

All LLCs doing business in the state of California must pay a flat $800 annual tax, even if they didn’t conduct business during that tax year. 

This tax is due on the 15th day of the fourth month of your LLC’s taxable year. You can pay online or by submitting a return form by mail.

LLCs with starting tax years between January 1, 2021, and January 1, 2024, do not have to pay the annual tax in their first year. 

LLC Fee

LLCs that make more than $250,000 in California income must pay an LLC fee each year. 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.

The LLC fee is due by the 15th day of the sixth month of your LLC’s taxable year. You can submit the return by mail.

Step 9: Keep Your Company Compliant

The critical aspects of compliance revolve around obtaining necessary business licenses and permits, fulfilling tax obligations, and adhering to employment regulations. Here are some critical points to keep your company on the right side of California law:

  • California Business Licenses & Permits: Ensuring your LLC's operations meet federal, state, and local government regulations is crucial. The fees and requirements for licenses and permits differ based on your business type. For detailed instructions, refer to our California Business License guide. You could also explore professional services to help ascertain your business’s licensing prerequisites.
  • California LLC Tax Filing Requirements: Your business might need to register for specific tax forms depending on its nature. These taxes include sales tax, payroll taxes (e.g., UI, withholding, and disability insurance tax), and state income tax. This is in addition to your federal income taxes.
  • Hiring Employees: If you're planning to hire employees for your California LLC, compliance with California law is essential. This includes verifying new employees' eligibility to work in the US, reporting new hires to the state, providing workers' compensation insurance, withholding employee taxes, and displaying California workplace compliance posters prominently. 
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Steps After LLC Formation

Read all the steps you’ll need to maintain your LLC’s personal liability protection, open a business bank account, get business insurance, and stay up to date with state reporting requirements.

Visit our After Forming an LLC guide to learn more.

California LLC Cost FAQ

The initial filing fee for forming an LLC in California is $70 if you file online or $85 if you file by mail. This fee covers the cost of submitting the Articles of Organization to the California Secretary of State. Besides the filing fee, California LLCs are also required to pay a minimum annual franchise tax of $800.

Yes, there can be additional costs. You may need to pay a registered agent fee, which is typically around $100 per year. If you wish to reserve your business name before filing the Articles of Organization, you'll have to pay a $20 name reservation fee.

A registered agent, known in California as an agent for service of process, is a person or business entity that is designated to receive official papers and legal notices on behalf of your LLC. The California Secretary of State mandates that all LLCs have an agent for service of process in the state. This service typically costs up to $200 per year.

Reserving a business name means that you secure the name for your LLC before actually filing your Articles of Organization. This ensures no one else can take your desired business name while you're preparing your LLC formation documents. The name reservation fee in California is $20.

An operating agreement is a document that outlines the rules and procedures of your LLC. It's not required by law in California, but having one is a good practice. It can help prevent misunderstandings by specifying member roles and responsibilities, profit sharing, and procedures for handling changes in membership.

Forming an LLC in California offers limited liability protection, meaning your personal assets are shielded from creditors if your LLC faces a lawsuit. Profits and losses from your LLC are reported on your personal tax return, avoiding double taxation. Lastly, the process of forming an LLC is relatively simple and can be done online or by mail.

The annual franchise tax is a mandatory fee for LLCs in California. The minimum amount is $800 per year, which is due even if the LLC does not conduct business or operates at a loss. This tax is separate from any income taxes your LLC may owe.

LLC formation services are companies that assist you in setting up your LLC. They handle the paperwork and submission of your Articles of Organization, can offer registered agent services, and often help with drafting operating agreements. The cost for these services can vary depending on the level of service you choose.

To minimize costs, you could handle all the filing and paperwork yourself. However, this can be time-consuming and confusing if you're not familiar with the process. Using an LLC formation service can save you time and potentially avoid errors, but it will add to the overall cost.

Article Sources

California Franchise Tax Board:
https://www.ftb.ca.gov/

IRS - Employer ID Numbers:
https://www.irs.gov/businesses/small-businesses-self-employed/employer-id-numbers

California Secretary of State - Business Programs:
https://www.sos.ca.gov/business-programs

SBA - Apply for Licenses and Permits:
https://www.sba.gov/business-guide/launch-your-business/apply-licenses-permits

Chamber of Commerce - California Chamber of Commerce List:
https://www.officialusa.com/stateguides/chambers/california.html