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How to Form an LLC in California in 2026

How to Form an LLC in California in 2026

California is not the most business-friendly state for LLC formation, the $800 annual franchise tax and multiple filing requirements add cost and complexity. But if you're doing business in California, you'll need a California LLC (or to register a foreign LLC there). Here's how.

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California LLC: The Key Facts Upfront

| Detail | Info |

|---|---|

| Filing fee | $70 |

| Annual franchise tax | $800 minimum (regardless of income) |

| Processing time | 5–10 business days standard |

| Statement of Information | Due within 90 days of formation, then every 2 years ($20) |

| Publication requirement | None (California eliminated this requirement) |

| Registered agent required | Yes |

The $800 annual franchise tax is the biggest gotcha. Every California LLC pays at least $800 per year to the Franchise Tax Board, regardless of whether the business makes any money. New LLCs are exempt the first year (since 2021).

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Step 1: Name Your California LLC

Requirements:

  • Unique in California, search the California Secretary of State Business SearchCalifornia Secretary of State Business Searchhttps://bizfileonline.sos.ca.gov
  • Must include "LLC," "L.L.C.," or "Limited Liability Company"
  • Cannot use restricted words (Bank, Insurance, Trust, etc.) without approval

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Step 2: File Articles of Organization

File online at [bizfileonline.sos.ca.gov](https://bizfileonline.sos.ca.gov)

Form LLC-1, Articles of Organization

Filing fee: $70

Processing time: 5–10 business days; expedited available for additional fee

Required info: LLC name, registered agent, and management structure (member-managed or manager-managed).

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Step 3: Appoint a California Registered Agent

Must have a physical California address. Can be yourself (if you have a CA address), an individual California resident, or a registered agent service.

Registered agent services: Northwest Registered Agent, Incfile, ZenBusiness, $49–$125/year.

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Step 4: File Statement of Information

Within 90 days of forming your LLC, you must file a Statement of Information (Form LLC-12) with the California Secretary of State.

Fee: $20

This must also be filed every 2 years after that. It updates your registered agent, address, and member information.

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Step 5: Get Your EIN

Free at IRS.gov/EINIRS.gov/EINhttps://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online. Instant.

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Step 6: Pay the California Franchise Tax

Every California LLC pays a minimum $800/year franchise tax to the California Franchise Tax Board.

First-year exemption: LLCs formed on or after January 1, 2021 are exempt from the $800 tax in their first taxable year.

Due: 15th day of the 4th month after your LLC's tax year begins.

Register with the California Franchise Tax Board at ftb.ca.govftb.ca.govhttps://www.ftb.ca.gov.

Additional LLC fee if gross income exceeds $250,000:

  • $250,001–$499,999: +$900
  • $500,000–$999,999: +$2,500
  • $1,000,000–$4,999,999: +$6,000
  • $5,000,000+: +$11,790

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Step 7: Register for California Sales Tax

If you sell taxable products or services, register for a California Seller's Permit (free) at cdtfa.ca.govcdtfa.ca.govhttps://www.cdtfa.ca.gov.

California state sales tax: 7.25% base rate. Combined with district taxes, rates in Los Angeles, San Francisco, and other cities often reach 9.5–10.5%.

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Total First-Year Cost to Form a California LLC

| Expense | Cost |

|---|---|

| Articles of Organization | $70 |

| Statement of Information | $20 |

| Registered agent service | $49–$125/year |

| Annual franchise tax (Year 1 exempt if formed 2021+) | $0–$800 |

| Total first year | $139–$1,015 |

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Should You Form in California or Delaware/Wyoming?

Many online sources suggest forming your LLC in Delaware or Wyoming to avoid California's $800 tax. This only works if you don't actually do business in California. If you live in California and run a business there, California will still require you to register as a Foreign LLC and pay the $800 tax. There's no way around it if you're operating in CA.

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California Business Resources

  • California Secretary of State: sos.ca.govsos.ca.govhttps://www.sos.ca.gov, LLC formation
  • California Franchise Tax Board: ftb.ca.govftb.ca.govhttps://www.ftb.ca.gov, franchise tax
  • California SBDC Network: Free consulting statewide
  • IBank: California small business financing programs

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