How to Form an LLC in California (2026)
Reviewed by DocDraft Legal Team · California · Last updated 2026-08-06
A limited liability company (LLC) is a business structure that legally separates the company from the people who own it, so the owners are generally not personally responsible for the company's debts. Forming one in California means filing a formation document with a state agency and paying its fee to bring the company into legal existence. In California you create an LLC by filing the Articles of Organization (Form LLC-1) with the Secretary of State through the bizfileOnline portal and paying a $70 filing fee. Two features make California different from most states and drive the real cost of running the company. First, the Franchise Tax Board charges an $800 minimum annual franchise tax that applies every year, including the first year, regardless of income. Second, California requires a Statement of Information (Form LLC-12) within 90 days of formation and then every two years for a $20 fee. California LLCs are governed by the California Revised Uniform Limited Liability Company Act in the Corporations Code, Title 2.6. This guide explains what an LLC is, the exact California steps and fees, and the deadlines that keep the company in good standing.
Find out where you stand in California
Where are you in forming your LLC?
DocDraft provides document preparation, not legal advice.
How do you form an LLC in California?
File the Articles of Organization (Form LLC-1) with the California Secretary of State through the bizfileOnline portal and pay the $70 filing fee. You must name an agent for service of process with a California street address. Within 90 days you file an initial Statement of Information (Form LLC-12) for a $20 fee.
What is the California LLC franchise tax?
California charges every LLC doing business or organized in the state an $800 minimum annual franchise tax, collected by the Franchise Tax Board under Revenue and Taxation Code section 17941. It applies regardless of profit or loss. The first-year payment is due by the 15th day of the fourth month after you form the LLC.
Does a California LLC need to file a Statement of Information?
Yes. Every California LLC must file an initial Statement of Information (Form LLC-12) with the Secretary of State within 90 days of forming, then file again every two years. The fee is $20. The statement lists the LLC's address, managers or members, and agent for service of process, and keeps the company in good standing.
Does California require newspaper publication to form an LLC?
No. California does not require an LLC to publish notice of its formation in a newspaper. This is unlike New York, Arizona, and Nebraska, where publication is a condition of forming or operating. In California the Articles of Organization filing and the ongoing state requirements are all handled through the Secretary of State, with no separate publication step.
California LLC formation at a glance
You form a California LLC by filing the Articles of Organization (Form LLC-1) with the Secretary of State for a $70 filing fee, submitted online through the bizfileOnline portal at bizfileOnline.sos.ca.gov. What sets California apart is the ongoing cost, not the formation cost. Every LLC doing business or organized in California owes an $800 minimum annual franchise tax to the Franchise Tax Board under Revenue and Taxation Code section 17941, and it applies whether or not the LLC makes money. LLCs with California total income of $250,000 or more owe an additional fee that rises with income, from $900 up to $11,790, under Revenue and Taxation Code section 17942. California also requires a Statement of Information (Form LLC-12) within 90 days of formation and then every two years for a $20 fee, a biennial cadence rather than the annual report many states use. Every LLC must name and maintain an agent for service of process with a physical California street address. California does not require newspaper publication. The governing statute is the California Revised Uniform Limited Liability Company Act, Corporations Code Title 2.6, sections 17701.01 and following.
Forming a two-owner California LLC, step by step
Suppose two friends in Los Angeles want to open a small design studio as an LLC. First they search the California Secretary of State's business search to confirm their name is available and includes a designator such as LLC, and they can reserve the name for a fee while they prepare paperwork. Next they appoint an agent for service of process: one owner lives in California and agrees to serve, using a California street address, not a P.O. box, where legal papers can be delivered during business hours. They then file the Articles of Organization (Form LLC-1) through the bizfileOnline portal and pay the $70 filing fee. The LLC legally exists once the Secretary of State files it. Within 90 days they file the initial Statement of Information (Form LLC-12) for $20, listing the LLC's address, its managers or members, and the agent. Because they have two members, they also write an operating agreement setting each owner's percentage and how profits split, even though California does not require them to file it. They apply to the IRS for a free EIN so the partnership can file taxes and open a bank account. Finally they calendar the $800 minimum annual franchise tax, due by the 15th day of the fourth month after formation and every year after, plus the next Statement of Information two years out. If the studio's California total income later reaches $250,000, they will also owe the tiered LLC fee under Rev. & Tax. Code § 17942.
Relevant Laws
California Revised Uniform Limited Liability Company Act (Corp. Code Title 2.6, §§ 17701.01 et seq.)
The California RULLCA governs the formation, management, and dissolution of every California LLC. It sets who may form an LLC, the required contents of the Articles of Organization, the agent-for-service-of-process requirement, and the default rules for member-managed and manager-managed companies. It replaced the older Beverly-Killea act and took effect January 1, 2014.
Corp. Code § 17702.01 (Articles of Organization; Form LLC-1)
Requires an LLC to be formed by delivering Articles of Organization to the California Secretary of State for filing. The Secretary of State provides this as Form LLC-1, which states the LLC's name, its business address, its agent for service of process, and whether it is member-managed or manager-managed. The filing fee is $70.
Corp. Code § 17701.13 (Agent for service of process)
Requires every California LLC to designate and continuously maintain an agent for service of process in California. The agent, an individual residing in California or a registered corporate agent, receives lawsuits and official notices for the company. The agent's California street address goes on the Articles of Organization and the Statement of Information.
Corp. Code § 17702.09 (Statement of Information; Form LLC-12)
Requires a California LLC to file a Statement of Information with the Secretary of State within 90 days after filing its Articles of Organization, and then every two years during the applicable filing period. The Secretary of State provides this as Form LLC-12. The filing fee is $20, and the statement keeps the LLC's address, management, and agent information current.
Rev. & Tax. Code § 17941 ($800 minimum annual franchise tax)
Imposes an annual tax of $800 on every LLC that is doing business in California or organized or registered with the Secretary of State. The tax is administered by the Franchise Tax Board and applies regardless of income or activity. The first-year payment is due by the 15th day of the fourth month after formation, and each following year's tax is due on the same date.
Rev. & Tax. Code § 17942 (LLC fee on total income)
Imposes an additional fee, separate from the $800 tax, on LLCs with California total income of $250,000 or more. The fee is tiered: $900 for income of $250,000 to $499,999, $2,500 for $500,000 to $999,999, $6,000 for $1,000,000 to $4,999,999, and $11,790 for $5,000,000 or more. It is estimated and paid to the Franchise Tax Board.
IRS federal tax classification (default pass-through)
The IRS does not tax the LLC as a separate category. By default a single-member California LLC is disregarded and taxed like a sole proprietorship, and a multi-member LLC is taxed as a partnership, with income passing through to the owners. An LLC may instead elect S corporation or C corporation treatment. This federal classification is separate from California's $800 franchise tax, which applies either way.
Regional Variances
How forming an LLC in California differs from other states
The $800 minimum annual franchise tax
This is the headline difference. Under Rev. & Tax. Code § 17941, every California LLC owes at least $800 a year to the Franchise Tax Board regardless of income, and since the temporary exemption for LLCs formed in 2021 through 2023 expired, it applies in the first year too. Most states charge no comparable minimum tax. It usually dwarfs the one-time $70 filing fee over the life of the company.
Biennial Statement of Information, not annual
California requires a Statement of Information (Form LLC-12) within 90 days of forming and then every two years, for a $20 fee. Many states require an annual report instead. The biennial cadence means the easiest way to fall out of good standing is forgetting the filing in the off-year cycle.
No newspaper publication requirement
California does not require you to publish notice of formation in a newspaper. New York, Arizona, and Nebraska do, which adds cost and a deadline. A California LLC is complete once the Secretary of State files the Articles of Organization, with no publication step.
Formation document and filing office
California uses the Articles of Organization (Form LLC-1), filed with the Secretary of State through the bizfileOnline portal. Some states call the document a Certificate of Formation or Certificate of Organization, and some route filings through a Division of Corporations rather than the Secretary of State.
Added income-based LLC fee
On top of the $800 tax, California imposes a tiered fee under Rev. & Tax. Code § 17942 once California total income reaches $250,000, ranging from $900 to $11,790. Most states have no equivalent income-based LLC fee, so a profitable California LLC can owe substantially more than an out-of-state peer.
Suggested Compliance Checklist
Confirm your LLC name is available and compliant
Before filing days after startingSearch the California Secretary of State's business search to confirm your desired name is not already in use and that it includes a required designator such as LLC or Limited Liability Company. Avoid restricted words that need special approval. You can reserve an available name with the Secretary of State for a fee while you prepare your Articles of Organization.
Appoint an agent for service of process
Before filing days after startingCalifornia requires an agent for service of process with a physical California street address who is available during business hours to accept legal documents. Decide whether you, a co-owner who lives in California, or a registered corporate agent service will serve. You will name the agent on the Articles of Organization, so settle this first.
File the Articles of Organization (Form LLC-1) with the Secretary of State
To create the LLC days after startingFile Form LLC-1 with the California Secretary of State through the bizfileOnline portal at bizfileOnline.sos.ca.gov and pay the $70 filing fee. The LLC legally exists only once the Secretary of State files it. Keep the filed confirmation as proof of formation.
Adopt an operating agreement
At or soon after formation days after startingPut the ownership percentages, profit split, management structure, and exit rules in writing. California's LLC act expects members to have an operating agreement, but you do not file it with the state. It governs how the LLC runs and overrides the act's default rules. Attorney review of the agreement is available as an option through DocDraft.
Get a federal EIN from the IRS
Before opening a bank account or hiring days after startingApply for an Employer Identification Number free on the IRS website. Multi-member LLCs, LLCs with employees, and LLCs electing corporate tax treatment need one. Single-member LLCs with no employees usually get one anyway to open a business bank account and keep business and personal finances separate.
File the initial Statement of Information (Form LLC-12) within 90 days
Within 90 days of formation, then every two years days after startingFile Form LLC-12 with the Secretary of State within 90 days after your Articles of Organization are filed, then every two years during the applicable filing window. The fee is $20. It lists the LLC's address, managers or members, and agent for service of process. Missing it can lead to suspension of the LLC.
Pay the $800 minimum annual franchise tax to the Franchise Tax Board
By the 15th day of the 4th month after formation, then annually days after startingEvery California LLC owes the $800 minimum annual franchise tax under Revenue and Taxation Code section 17941, whether or not it makes money, and it applies in the first year. Pay the Franchise Tax Board by the 15th day of the fourth month after formation and on the same date each following year. Calendar it so a lapse does not put the LLC out of good standing.
Estimate the income-based LLC fee if income reaches $250,000
By the 15th day of the 6th month of the tax year days after startingIf your LLC's California total income is $250,000 or more, you owe an additional tiered fee under Revenue and Taxation Code section 17942, from $900 up to $11,790, separate from the $800 tax. The estimated fee is generally due by the 15th day of the sixth month of the tax year. Confirm current thresholds and due dates with the Franchise Tax Board.
| Task | Description | Document | Days after starting |
|---|---|---|---|
| Confirm your LLC name is available and compliant | Search the California Secretary of State's business search to confirm your desired name is not already in use and that it includes a required designator such as LLC or Limited Liability Company. Avoid restricted words that need special approval. You can reserve an available name with the Secretary of State for a fee while you prepare your Articles of Organization. | - | Before filing |
| Appoint an agent for service of process | California requires an agent for service of process with a physical California street address who is available during business hours to accept legal documents. Decide whether you, a co-owner who lives in California, or a registered corporate agent service will serve. You will name the agent on the Articles of Organization, so settle this first. | - | Before filing |
| File the Articles of Organization (Form LLC-1) with the Secretary of State | File Form LLC-1 with the California Secretary of State through the bizfileOnline portal at bizfileOnline.sos.ca.gov and pay the $70 filing fee. The LLC legally exists only once the Secretary of State files it. Keep the filed confirmation as proof of formation. | - | To create the LLC |
| Adopt an operating agreement | Put the ownership percentages, profit split, management structure, and exit rules in writing. California's LLC act expects members to have an operating agreement, but you do not file it with the state. It governs how the LLC runs and overrides the act's default rules. Attorney review of the agreement is available as an option through DocDraft. | llc-operating-agreement | At or soon after formation |
| Get a federal EIN from the IRS | Apply for an Employer Identification Number free on the IRS website. Multi-member LLCs, LLCs with employees, and LLCs electing corporate tax treatment need one. Single-member LLCs with no employees usually get one anyway to open a business bank account and keep business and personal finances separate. | - | Before opening a bank account or hiring |
| File the initial Statement of Information (Form LLC-12) within 90 days | File Form LLC-12 with the Secretary of State within 90 days after your Articles of Organization are filed, then every two years during the applicable filing window. The fee is $20. It lists the LLC's address, managers or members, and agent for service of process. Missing it can lead to suspension of the LLC. | - | Within 90 days of formation, then every two years |
| Pay the $800 minimum annual franchise tax to the Franchise Tax Board | Every California LLC owes the $800 minimum annual franchise tax under Revenue and Taxation Code section 17941, whether or not it makes money, and it applies in the first year. Pay the Franchise Tax Board by the 15th day of the fourth month after formation and on the same date each following year. Calendar it so a lapse does not put the LLC out of good standing. | - | By the 15th day of the 4th month after formation, then annually |
| Estimate the income-based LLC fee if income reaches $250,000 | If your LLC's California total income is $250,000 or more, you owe an additional tiered fee under Revenue and Taxation Code section 17942, from $900 up to $11,790, separate from the $800 tax. The estimated fee is generally due by the 15th day of the sixth month of the tax year. Confirm current thresholds and due dates with the Franchise Tax Board. | - | By the 15th day of the 6th month of the tax year |
Frequently Asked Questions
An LLC, or limited liability company, is a business structure that separates the company from its owners as a matter of law. The owners, called members, are generally not personally liable for the company's debts or lawsuits, so a creditor usually cannot reach a member's home or savings for a business obligation. In California, LLCs are created under the California Revised Uniform Limited Liability Company Act in the Corporations Code, Title 2.6. An LLC pairs that liability protection with pass-through taxation and lighter paperwork than a corporation, which is why it is the most common structure for small California businesses.
You start a California LLC by filing the Articles of Organization, known as Form LLC-1, with the California Secretary of State. The easiest route is the bizfileOnline portal, and the filing fee is $70, paid once. The LLC legally exists only after the Secretary of State files the form. That $70 is the formation cost by itself; California's ongoing charges, such as the franchise tax, are separate and matter more over the life of the company.
It depends on your priorities. A sole proprietorship costs nothing to start but gives you no liability shield, so your personal assets are exposed to business debts and lawsuits. A California LLC costs $70 to form plus the $800 minimum annual franchise tax, but it separates your personal assets from the business. If you carry any real risk or debt, the liability protection usually justifies the cost. Attorney review of your setup is available as an option if you want a second opinion.
California charges every LLC an $800 minimum annual franchise tax through the Franchise Tax Board under Revenue and Taxation Code section 17941, owed whether or not the LLC makes money. The first-year payment is due by the 15th day of the fourth month after you form. The temporary first-year waiver only covered LLCs formed in 2021 through 2023 and has expired, so a new LLC owes the $800 for its first year. Confirm current rules with the Franchise Tax Board.
Yes, above a threshold. On top of the $800 minimum tax, California adds a tiered fee under Revenue and Taxation Code section 17942 once your California total income reaches $250,000. It runs $900 for $250,000 to $499,999, $2,500 for $500,000 to $999,999, $6,000 for $1,000,000 to $4,999,999, and $11,790 for $5,000,000 or more. The estimated fee is generally due by the 15th day of the sixth month of the tax year. Most states have no equivalent income-based LLC fee.
Yes. If your name is available but you are not ready to file the Articles of Organization, you can reserve it with the California Secretary of State for a $10 fee, which holds the name while you prepare your paperwork. Check availability first through the Secretary of State's business search, and make sure the name includes a designator such as LLC or Limited Liability Company. Reservation is optional; many filers simply file the Articles of Organization directly once the name clears.
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