Fact Checked by Editorial Staff
Perhaps you are hoping to form a California LLC. People assume how to start an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in California.
On this page, you’ll learn about the following:
California LLC Cost of Filing
Here are the costs involved in forming an LLC in California.
Cost of Filing Formation Certificates
The California Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the California Secretary of State.
California Domestic LLC
- Online Filing costs $70 + $800 Franchise Tax.
- Filing Statement of Information within 90 days of registration costs $20.
- By Mail: Fill out the application form, and send it to Secretary of State Business Services, 1500 11th Street, Sacramento, CA 95814. Costs $70 + $15 for counter drop off (non-refundable).
California Foreign LLC
- Online Filing costs $70 + $800 Franchise Tax.
- Filing Statement of Information within 90 days of registration costs $20
- By Mail: Fill out the application form, and send it to Secretary of State Business Services, 1500 11th Street, Sacramento, CA 95814. Costs $70.
Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
California LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in California, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.
LLC Service | Our Rating & Pricing | Top Features | Learn More |
#1 TOP PICK  | $0 + State Fees |
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 | $0 + State Fees |
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Business Permits and Licenses
The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the California Department of Tax and Fee Administration for regulatory boards or agencies requiring licensing.
Taxes Paid By The LLC in California
Any business in California has three types of taxes to be paid. Income Tax, Corporate Tax, and Franchise Tax. LLCs are exempted from the Corporate Taxes due to the pass-through taxes. The LLC members are liable to pay income taxes and Franchise tax. Apart from these three taxes, every LLC in California has to obtain EIN, there is no fee for obtaining EIN in California. On the other, a certain amount of Sales Tax has to be paid by the LLCs.
Franchise Tax
Franchise Tax is a minimum mandatory tax paid by the LLCs. Any LLC (domestic or foreign) registered with California state has to pay $800 whether it is running or inactive. As long as the LLC is registered it has to bear the Franchise Tax.
According to the Franchise Tax Board of California, this is a privilege tax for running a business in California and has to be paid by the LLCs following some terms and conditions.
Franchise Tax According to Income Tier
Following are the different income tiers based on which the amount of tax amount is calculated.
- Income from $0 to $250,000: $800 Franchise tax + $0 LLC Fee > Total $800
- Income from $250,000 to $499,999: $800 Franchise tax + $900 LLC Fee > Total $1700
- Income from $500,000 to $999,999: $800 Franchise tax + $2500 LLC fee > Total $3300
- Income from $1,000,000 to $4,999,999: $800 Franchise tax + $6000 LLC Fee > Total $6800
- Income above $5,000,000: $800 Franchise tax + $11,790 LLC fee > Total $12,590
Federal Tax
Apart from these above-mentioned state taxes, California LLCs have to pay a Federal Tax of 15.3% on the total income generated by the LLC.
Cost Comparison Among States
California is one of the best states to start an LLC. The state is bounded by Arizona, Nevada, Colorado, and Oregon. Here’s the cost comparison among the neighboring states of California.
| State | Filing Fee | Annual Fee/Biennial Fee |
| California LLC | $70 | $800 + $20 (every 2 years) |
| Oregon LLC | $100 | $100 (Annual) |
| Nevada LLC | $425 | $350 (Annual) |
| Arizona | $50 | $0 |
| Colorado | $50 | $10 (Annual) |
Comparing the neighboring states, we can say Arizona has the least LLC fees, however, California is the most favorable among all for the businesses as it has immense tax advantages. Apart from that, the state has massive business opportunities.
Other Costs
- California Name Reservation: $10 for online filing or by mail; $20 for drop off requests
- Doing Business As (DBA): Cost varies between counties for both online filing and by mail
- Certified Document Copies: $5 + $1 for 1st page and $0.50 for succeeding pages.
- Certificate of Good Standing: $5 per entity
- Business Domain Name and Website: depend on your preference, but domain name could be as low as $2.99/yr at NameCheap, and web hosting is at least $30/mo at Kinsta.
- Online workspace: at least $4.20/mo for GSuite.
- Business Insurance: would vary depending on insurance type–whether general liability insurance or professional liability insurance–and coverage.
- Dissolution of California LLC: $0 filing fee; $15 for faster service
F.A.Qs
It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.
It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.
The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.
How Much Does It Cost to Maintain an LLC in California
To maintain an LLC in California you will need to pay a biennial fee of $800 + $20 along with Income tax, Franchise tax and federal taxes.
The cost of maintaining an LLC in California can vary depending on several factors. An essential ongoing fee for LLCs in California is the annual Franchise Tax, which is the fee paid to the state for the privilege of doing business as an LLC. This tax is due every year regardless of whether the LLC is making a profit or not. Additionally, business owners need to keep in mind the cost of filing taxes for the LLC, which involves hiring an accountant or tax professional to ensure compliance with state regulations.
Another significant cost related to maintaining an LLC in California is the required annual Statement of Information filing. This filing provides updated information about the LLC’s officers, managers, and addresses and is mandatory for all LLCs in the state. Failure to file this statement on time can result in late fees and penalties, so it is crucial for business owners to stay organized and up-to-date with these requirements.
Furthermore, business owners should consider the costs associated with obtaining necessary permits and licenses for their LLC in California. Depending on the nature of the business, certain industries may require specific permits or licenses to operate legally. These costs can add up quickly, so it is essential to research and understand the requirements beforehand to avoid any surprises down the road.
In addition to the above-mentioned costs, business owners should also budget for other miscellaneous expenses that may arise throughout the year. These can include legal fees, insurance premiums, marketing expenses, and any other costs associated with running a business in California. It is essential to have a financial plan in place to cover these unexpected expenses to ensure the long-term success and stability of the LLC.
While the cost of maintaining an LLC in California may seem daunting at first, it is crucial to consider these expenses as an investment in the business’s future. By planning and budgeting for these ongoing costs, business owners can ensure compliance with state regulations, protect their personal assets, and position their LLC for growth and success in the competitive California market.
Overall, understanding the cost of maintaining an LLC in California is essential for business owners looking to establish and grow their companies in the state. By taking the time to research and prepare for these ongoing expenses, entrepreneurs can set themselves up for long-term success and profitability.
In Conclusion
The cost of California is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.
Como y donde pago los 800 de mi corporacion cual el email.