How to Form an LLC in California: Steps, Fees, and Filings

To form an LLC in California, file the Articles of Organization online through the Secretary of State’s bizfile portal and pay a $70 filing fee. You’ll also need a registered agent with a California street address, a Statement of Information filed within 90 days ($20), an operating agreement kept in your own records, and a federal Employer Identification Number before a bank will open a business account. Every California LLC then owes an $800 annual franchise tax to the Franchise Tax Board, and that obligation now starts in year one for any LLC formed in 2024 or later.

Pick a Name That Meets California’s Rules

Your LLC name must include “Limited Liability Company” or an accepted abbreviation like “LLC” or “L.L.C.” You can shorten “Limited” to “Ltd.” and “Company” to “Co.” as long as the name still signals that the entity is an LLC.¹

The name also has to be distinguishable from every other LLC, foreign LLC, and reserved name already on file. Search the Secretary of State’s online business database before you submit anything. If your proposed name is too close to an existing entity, the filing gets rejected and you start over.¹

Appoint a Registered Agent

Every California LLC must maintain a registered agent authorized to accept lawsuits and government notices on the company’s behalf, plus a California office address (though not necessarily a place where business is actually done).²

Your agent has to be either a California resident with a physical street address in the state or a corporation authorized under California law to serve as an agent. A P.O. box doesn’t qualify. You can name yourself or another member, but whoever serves needs to be available at the listed address during normal business hours. Commercial registered agent services run roughly $50 to $300 per year and spare you from being tied to one location.²

File the Articles of Organization

The Articles of Organization (Form LLC-1) is the document that officially creates your LLC. California requires online filing through the bizfile Online portal, and the fee is $70.³

The form asks for your LLC’s name, a general statement of business purpose, the street address of the principal office, your registered agent’s name and California address, and whether the LLC will be member-managed or manager-managed. That last choice matters. In a member-managed LLC, every owner can make decisions and sign contracts. A manager-managed structure concentrates that authority in one or more designated managers, which suits situations where some owners want to invest without running day-to-day operations. The designation becomes part of the public record.

Processing Times and Expedited Options

As of early 2026, the Secretary of State is processing online LLC formations within a few business days.⁴ Processing slows at the end of the fiscal and calendar years, so plan for delays if you’re forming in late spring or December.

If you need it faster, the state offers paid expedited services on top of the $70 filing fee:⁵

Drop-off special handling: $15 per filing, gives your request priority over mailed submissions
24-hour service (Class C): $350
4-hour service (Class A): $500
Same-day service (Class B): $750

In-person submissions must be paid by check or money order made out to the Secretary of State.

File the Statement of Information Within 90 Days

Within 90 days of forming your LLC, you must file a Statement of Information (Form LLC-12) with the Secretary of State.⁶ The fee is $20, filed through the same bizfile portal.⁷ The form collects the LLC’s executive and mailing addresses, the names and addresses of all managers or members, and a short business description. This information becomes public record.

After the initial filing, you update it every two years. The Secretary of State assigns a six-month filing window based on the month your LLC was formed. An LLC formed in March would file its biennial updates during the October-through-March window every other year. File an updated statement whenever your information changes between periods.⁸

Miss the deadline and it gets expensive. The Secretary of State can suspend or forfeit your LLC, and the Franchise Tax Board adds a $250 penalty. A suspended LLC loses the right to conduct business in California, can’t defend itself in court, and can’t transfer real property.⁹

Draft an Operating Agreement

California’s LLC statute lets an operating agreement govern member relationships, management authority, business activities, and how the agreement itself is amended. Where your operating agreement is silent, the default rules from the Corporations Code apply automatically.¹⁰ You don’t file it with the Secretary of State or anyone else. Keep it in your own records.

Skipping this document is one of the most common mistakes. Without one, state defaults dictate profit sharing, voting rights, and what happens when a member leaves, and those defaults rarely match what co-owners agreed to informally. A useful operating agreement covers:

How profits and losses are allocated among members
Which decisions need unanimous consent versus a simple majority
What happens when a member wants to sell their interest or leave
The process and approval required to admit new members
The steps for winding down the LLC if the business ends

For single-member LLCs, an operating agreement still matters. It reinforces the legal separation between you and the entity, which is the whole reason to form an LLC in the first place. Courts are more likely to respect that separation when a written document establishes the LLC as a distinct entity with its own rules.

Pay the $800 Annual Franchise Tax

Every California LLC owes an $800 annual franchise tax to the Franchise Tax Board, whether or not the business earns anything that year.¹¹ The tax is due by the 15th day of the fourth month of each taxable year — April 15 for calendar-year filers. The first-year payment is due by the 15th day of the fourth month after you file with the Secretary of State. The first-year exemption that once waived this for new LLCs expired for tax years beginning on or after January 1, 2024, so any LLC formed in 2024 or later pays the full $800 in year one.¹²

The $800 keeps accruing every year until you formally cancel your LLC by filing a certificate of cancellation. Stopping operations or filing a “final” return doesn’t end the obligation.¹¹

Additional Fee for Higher Income

LLCs with total California income above $250,000 owe an additional annual fee on top of the $800:¹³

$250,000 to $499,999: $900
$500,000 to $999,999: $2,500
$1,000,000 to $4,999,999: $6,000
$5,000,000 or more: $11,790

“Total income” for this fee means gross income plus the cost of goods sold, which is broader than net profit. An LLC with $400,000 in revenue and $300,000 in expenses still owes the $900 fee, because the calculation uses gross figures, not bottom-line profit.¹³

Get a Federal EIN

Most California LLCs need an Employer Identification Number from the IRS. You’ll need one if you plan to hire employees, have more than one member, or file excise taxes. Banks also require an EIN to open a business account, so in practice almost every LLC applies for one.¹⁴

The application is free and takes about ten minutes on the IRS website. Online applicants get their EIN immediately. Form your LLC with the Secretary of State first, because the IRS requires your entity to already exist at the state level before it will issue a number.¹⁴

Licensed Professionals Can’t Use a Standard LLC

California law flatly prohibits LLCs from providing professional services that require a state license, certification, or registration.¹⁵ Doctors, lawyers, accountants, architects, engineers, and dozens of other licensed professions are covered. If that’s you, you’ll need a professional corporation or, for certain professions, a registered limited liability partnership instead.

Federal Beneficial Ownership Reporting No Longer Applies

As of March 2025, LLCs formed in the United States are exempt from filing Beneficial Ownership Information reports with the Financial Crimes Enforcement Network. A revised rule narrowed the reporting requirement to foreign companies registered to do business in a U.S. state, and FinCEN has stated it will not enforce BOI penalties against U.S. citizens or domestic companies.¹⁶

1
California Legislative Information. California Corporations Code 17701.08 – Name of Limited Liability Company
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California Legislative Information. California Corporations Code 17701.13 – Maintenance of Office and Agent for Service of Process
3
California Secretary of State. Limited Liability Companies – California
4
California Secretary of State. Current Processing Dates
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California Secretary of State. Service Options
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California Legislative Information. California Corporations Code 17702.09 – Statement of Information
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California Secretary of State. Business Entities Fee Schedule
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California Secretary of State. Statements of Information Filing Tips
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Franchise Tax Board. My Business Is Suspended
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California Legislative Information. California Corporations Code 17701.10 – General Provisions
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California Legislative Information. California Revenue and Taxation Code 17941
12
Franchise Tax Board. Limited Liability Company
13
Franchise Tax Board. FTB Publication 3556 – Limited Liability Company Filing Information
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Internal Revenue Service. Get an Employer Identification Number
15
California Legislative Information. California Corporations Code 17701.04 – General Provisions
16
FinCEN.gov. Beneficial Ownership Information Reporting