To form an LLP in California, you file Form LLP-1 with the Secretary of State, pay a $70 registration fee, and put the required professional liability insurance or alternative financial security in place before the partnership begins operating. Only five licensed professions qualify to use the structure, and every partner must hold a license in the same field. Everything else, including the annual $800 tax and, for law firms, a separate State Bar renewal, follows from those first decisions.
Confirm Your Firm Qualifies
California limits the LLP structure to partnerships that provide services in one of five licensed professions: law, public accountancy, architecture, engineering, and land surveying.1California Legislative Information. California Code CORP 16101 – Definitions Every partner must be licensed in the same profession, and the firm’s services must stay inside that single field.
A group of attorneys can register an LLP to practice law. A group of licensed engineers can register one to provide engineering services. A partnership between an attorney and an architect cannot register one LLP covering both practices. General businesses, consulting firms, and ventures outside those five categories cannot use this entity type at all. If your firm does not fit, an LLC or corporation is the direction to look; the LLP path stops here.
Put a Partnership Agreement in Writing First
California does not require a written partnership agreement to register an LLP, but skipping one means the California Uniform Partnership Act governs by default, and the defaults rarely match what partners actually want. The Franchise Tax Board recommends putting a formal written agreement in place before operations begin.
At a minimum, the agreement should cover how profits and losses are split, each partner’s capital contribution, who has authority to bind the firm, how new partners are admitted, what vote is required for major decisions, how a partner leaves or is removed, and how disputes are resolved. For a professional LLP, it is also worth spelling out how the firm will keep partners’ licenses in good standing, maintain the required insurance, and allocate responsibility for compliance. Negotiating these terms up front is much cheaper than negotiating them during a fight.
File Form LLP-1 With the Secretary of State
The registration document is Form LLP-1, the Application to Register a Limited Liability Partnership. Corporations Code Section 16953 sets the required contents.2California Legislative Information. California Code CORP 16953 The form asks for:
- The partnership name, which must include “Limited Liability Partnership,” “Registered Limited Liability Partnership,” or the abbreviation “LLP” or “R.L.L.P.”
- The principal office street address, plus a mailing address if different.
- The name and California street address of an agent for service of process — either an individual resident of California or a corporation authorized to accept legal documents on the partnership’s behalf.
- A brief description of the professional services the partnership will provide, confirming they fall within one of the five permitted categories.
- A declaration that the partnership is registering as a registered limited liability partnership.
The filing fee is $70.3California Secretary of State. Business Entities Fee Schedule Online filing through the Secretary of State’s bizfileOnline portal is the fastest option. Paper filings can be mailed to the Sacramento office or delivered in person, though in-person paper filings incur an additional $15 special handling fee. Once the Secretary of State accepts the filing, you receive a filed copy confirming the LLP legally exists.
Set Up the Required Financial Security
Every California LLP must maintain financial security for claims against the partnership at the time of registration and continuously while it operates. The requirement can be satisfied through liability insurance, a cash deposit held in trust or bank escrow, U.S. Treasury obligations, bank letters of credit, surety bonds, or a combination.4California Legislative Information. California Corporations Code 16956 – Security for Claims Against Registered Limited Liability Partnerships A partnership with net worth of at least $10 million as of its most recently completed fiscal year can use that net worth to meet the requirement instead.
Minimum amounts depend on the profession and the number of licensed partners:
- Public accountancy and architecture: at least $1,000,000 for firms with five or fewer licensed persons; add $100,000 for each additional licensee, capped at $5,000,000.4California Legislative Information. California Corporations Code 16956 – Security for Claims Against Registered Limited Liability Partnerships
- Engineering and land surveying: at least $2,000,000 for firms with five or fewer licensed persons; add $100,000 per additional licensee, capped at $5,000,000.5California Legislative Information. California Code CORP – Article 10 Limited Liability Partnerships
- Law: at least $1,000,000 for firms with five or fewer licensed persons; add $100,000 per additional licensee, capped at $7,500,000.5California Legislative Information. California Code CORP – Article 10 Limited Liability Partnerships
Engineering and land surveying firms start at $2 million rather than $1 million, which catches people off guard. Confirm with your insurance broker that any policy you purchase meets the correct threshold for your profession.
Get a Federal Employer Identification Number
Every partnership needs an Employer Identification Number from the IRS before it can open a bank account, hire employees, or file returns. The application is free, and the IRS specifically warns against third-party websites that charge for the service.6Internal Revenue Service. Get an Employer Identification Number Complete state registration first; applying before the entity is formed with the state can delay the EIN.
The IRS online application issues the EIN immediately. Applications by phone, fax, or mail are also accepted.
Understand What the Liability Shield Does and Does Not Cover
The reason to register an LLP rather than run a general partnership is protection from your partners’ mistakes. Under Corporations Code Section 16306, a partner in a registered LLP is not liable for the partnership’s debts or obligations that arise while the registration is active, simply by virtue of being a partner.7California Legislative Information. California Code Corporations Code 16306
The shield has limits worth knowing before you rely on it. Section 16306(e) preserves each partner’s personal liability for their own tortious conduct.7California Legislative Information. California Code Corporations Code 16306 Your own malpractice is still your own problem. Protection also depends on keeping the registration current and the financial security in place; a lapse in either can expose partners personally for claims arising during the gap.
Plan for Annual Compliance
Registration is a one-time event. Keeping the LLP in good standing is not.
The $800 Annual Tax
Every LLP doing business in California or registered with the Secretary of State pays an annual tax of $800 to the Franchise Tax Board, whether or not the partnership earned any income. The tax is set by Revenue and Taxation Code Section 17948 and matches the minimum franchise tax that applies to corporations.8California Legislative Information. California Revenue and Taxation Code 17948
State Bar Renewal for Law Firms
A law firm LLP must also renew its certificate of registration annually with the State Bar of California. For 2026, the renewal fee is $88 for the first two partners plus $32 for each additional partner, with no cap. A late renewal triggers a $103 noncompliance fee.9The State Bar of California. Limited Liability Partnerships Renewals must be submitted through the State Bar’s online billing system, and forms from prior years are not accepted.
Keeping the Security Current
The insurance or alternative security described earlier is a continuous obligation. Track renewal dates well in advance and keep certificates of insurance on file. A lapse does not just risk a fine; it can strip partners of the liability shield for anything that goes wrong during the gap.
How the LLP Is Taxed
An LLP does not pay federal income tax as an entity. The partnership files Form 1065 as an information return, and each partner receives a Schedule K-1 reporting their share of income, deductions, and credits, which they then report on their personal return.10Internal Revenue Service. About Form 1065, U.S. Return of Partnership Income
LLP partners are treated as general partners for tax purposes, so each partner’s share of ordinary business income is subject to self-employment tax, regardless of material participation. Guaranteed payments for services, including a fixed draw, also count as self-employment income. Because no employer is withholding on their behalf, partners should plan for quarterly estimated payments from the start.