How much does it cost to form an LLC in California?

The California LLC filing fee is $70 for Articles of Organization. However, all California LLCs must pay an $800 annual franchise tax (due the 15th day of the 4th month after formation, then every April 15). Total first-year cost: at least $870 before any optional services.

Does California still have the $800 franchise tax for new LLCs?

As of 2024, California waived the $800 franchise tax for the first year for new LLCs. Starting in 2026, check the Franchise Tax Board (ftb.ca.gov) for current rules. The waiver applied to LLCs formed between January 1, 2021 and January 1, 2024, then was extended. The annual franchise tax still applies in subsequent years.

How long does it take to get an LLC in California?

Online filing through bizfileonline.sos.ca.gov is typically processed in 1–3 business days. Mail filing takes 5–10 business days. Expedited processing is available for an additional fee: $350 for same-day, $750 for 4-hour processing.

How to Form an LLC in California: Costs, Steps & Requirements (2026)

California is the most popular state for LLC formation by volume, but it’s also one of the most expensive because of the $800 annual franchise tax.

Quick answer: File Articles of Organization (Form LLC-1) with the California Secretary of State for $70. Pay the $800 annual franchise tax to the Franchise Tax Board. File the biennial Statement of Information ($20). Total first-year minimum: $870. Processing takes 1–3 business days online.

California LLC at a Glance

Detail	Info
Filing fee (Articles of Organization)	$70
Annual franchise tax	$800 minimum
Statement of Information	$20 (biennial)
Processing time	1–3 business days (online)
Expedited filing	$350 (same-day), $750 (4-hour)
Where to file	bizfileonline.sos.ca.gov
Operating agreement	Required by law (CA Corp Code §17701.10)
State income tax rate	1.5%–13.3% (personal), LLC fee on gross income above $250K
Annual LLC fee (gross income)	$0–$11,790 depending on revenue

Total Cost Breakdown

Item	Cost	Frequency
Articles of Organization	$70	One-time
Franchise tax (minimum)	$800	Annual
Statement of Information	$20	Every 2 years
LLC fee (gross income > $250K)	$900–$11,790	Annual
Registered agent (optional service)	$100–$300	Annual
Operating agreement (DIY)	$0	One-time
EIN	$0	One-time
Total first year (minimum)	$870	—
Total first year (with agent)	$970–$1,170	—

California LLC Fee Schedule (Based on Gross Income)

Total California Gross Income	LLC Fee
Less than $250,000	$0
$250,000–$499,999	$900
$500,000–$999,999	$2,500
$1,000,000–$4,999,999	$6,000
$5,000,000 or more	$11,790

Note: This fee is based on gross income (revenue), not net profit. A business with $300,000 in revenue and $10,000 in profit still pays $900.

Step-by-Step Formation

Step 1: Choose Your LLC Name

Requirement	Details
Must include	“LLC,” “L.L.C.,” or “Limited Liability Company”
Must be unique	Search at bizfileonline.sos.ca.gov
Cannot include	“Corporation,” “Corp,” “Inc.” (implies different entity type)
Restricted words	“Bank,” “Trust,” “Insurance” require additional approval
Name reservation	$10 for 60 days (optional)

Step 2: Choose a Registered Agent

California calls this an “Agent for Service of Process.”

Requirement	Details
Must be a California resident or entity	Out-of-state individuals cannot serve
Physical California address required	No PO boxes
Must be available during business hours	To accept legal documents
Can be a member of the LLC	You can serve as your own agent

Step 3: File Articles of Organization (Form LLC-1)

Field	What to Enter
LLC name	Full legal name including “LLC”
Business address	Street address in California
Mailing address	Can be same as business address
Agent for Service of Process	Name and California address
Management	Member-managed or manager-managed
Organizer	Name and signature

How to file:

Go to bizfileonline.sos.ca.gov
Click “File” → “LLC” → “Articles of Organization”
Fill out the form
Pay $70 filing fee
Receive stamped articles (1–3 business days)

Step 4: File Statement of Information (Form LLC-12)

Detail	Info
Due	Within 90 days of formation
Fee	$20
Frequency	Every 2 years after initial filing
Where to file	bizfileonline.sos.ca.gov
Includes	Business address, agent info, member/manager names

Step 5: Create an Operating Agreement

California requires all LLCs to have an operating agreement (California Corporations Code §17701.10). It doesn’t need to be filed with the state — keep it in your records.

Step 6: Get an EIN

Detail	Info
Apply at	irs.gov/ein
Cost	Free
Processing	Instant (online)
Required for	Bank account, hiring employees, tax filing

Step 7: Pay Franchise Tax

Detail	Info
Amount	$800 minimum
First year due date	15th day of the 4th month after formation
Subsequent years	April 15
Pay to	Franchise Tax Board (ftb.ca.gov)
Form	FTB 3522 (LLC Tax Voucher)

Step 8: Open a Business Bank Account

Bring your stamped Articles of Organization, EIN confirmation, operating agreement, and government ID to any bank.

California LLC Taxes

Tax	Rate	Who Pays
Franchise tax	$800/year minimum	All California LLCs
LLC fee	$0–$11,790	LLCs with gross income > $250K
California income tax	1%–13.3%	Pass-through to members
Self-employment tax	15.3%	Active members (federal)
Sales tax	7.25%–10.75%	LLCs selling taxable goods

California vs. Other States

Factor	California	Texas	Florida	Wyoming
Filing fee	$70	$300	$125	$100
Annual franchise tax	$800	$0 (<$2.47M rev.)	$0	$0
Annual report/fee	$20/2 years	$0	$138.75/year	$60/year
State income tax	Up to 13.3%	0%	0%	0%
LLC fee (revenue)	Up to $11,790	N/A	N/A	N/A
First-year total	$870+	$300	$263.75	$160

Ongoing Compliance

Requirement	Due Date	Cost
Annual franchise tax	April 15	$800 minimum
LLC fee (if applicable)	June 15 (estimated)	$0–$11,790
Statement of Information	Every 2 years (formation anniversary month)	$20
Federal tax return	March 15 (multi-member) or April 15 (single-member)	N/A
California tax return	Same as federal	N/A

Common Mistakes in California

Mistake	Consequence
Not paying franchise tax first year	Penalties + interest from FTB
Forgetting Statement of Information	$250 penalty, possible suspension
Not having operating agreement	Violates state law, weakens liability protection
Forming in another state to avoid franchise tax	Still owe CA taxes if doing business in CA
Ignoring LLC fee on gross income	Underpayment penalties

Should You Form in California or Another State?

If you live and do business in California, form in California. Forming in Wyoming or Delaware to “save money” doesn’t work — California requires you to register as a foreign LLC and pay the franchise tax anyway if you’re doing business in the state. You’d pay fees in two states instead of one.

Scenario	Recommended State
Live + operate in California	California
Remote business, no CA presence	Consider Wyoming or Texas
Multi-state business based in CA	California (home state) + register in other states
E-commerce, no physical CA location	Depends on nexus — may still be CA

Bottom Line

California LLCs cost more than most states — plan for at least $870 the first year ($70 filing + $800 franchise tax) and $820+ annually after that. The franchise tax is due regardless of whether your LLC makes money. Despite the costs, if you live and operate in California, forming your LLC there is the simplest and most legally sound approach.