Starting a business in Los Angeles means stacking filings at three levels of government before you can legally open. At minimum, you’ll register your entity with the California Secretary of State, get a federal tax ID, file a fictitious business name if you’re using one, obtain a Los Angeles Business Tax Registration Certificate, and confirm your location is zoned for what you plan to do. Depending on your industry, you may also need a seller’s permit, a health permit, an alcohol license, or a state professional license. Here’s what each step actually requires, in the order most founders hit them.
Form Your Entity and Get an EIN
Your first decision is the legal structure. Most small businesses in Los Angeles form either a limited liability company or a corporation, though sole proprietorships and partnerships are also options. The choice affects your personal liability, your taxes, and the paperwork you’ll file every year after.
To form an LLC, you file Articles of Organization with the California Secretary of State for a $70 fee. For a corporation, you file Articles of Incorporation for $100. Both filings require the business name, a statement of purpose, and the name and address of a registered agent authorized to receive legal documents for the entity. Filings go through the Secretary of State’s bizfile portal or by mail.1California Secretary of State. Business Entities Fee Schedule
Once your entity exists, apply to the IRS for a Federal Employer Identification Number. The EIN is free, and if your principal business is in the United States you can get it immediately through the IRS online application. You’ll need the responsible party’s Social Security number or ITIN plus basic entity details.2Internal Revenue Service. Get an Employer Identification Number
File a DBA If You’re Using a Trade Name
If your business will operate under any name other than your legal name (for a sole proprietor) or the exact entity name registered with the Secretary of State, California requires a fictitious business name statement. The trigger is specific: if the operating name doesn’t include the surname of every owner, or if it suggests additional owners who don’t exist (words like “& Company” or “Associates”), you have to file.3Justia. California Business and Professions Code Chapter 5 – Fictitious Business Names 17900-17930
In Los Angeles, the filing goes to the County Registrar-Recorder/County Clerk, not the Secretary of State. The fee is $26 for one business name and one registrant, plus $5 for each additional name or registrant.4Los Angeles County RR/CC. Fictitious Business Name Fees You have 40 days from starting business under the fictitious name to file. Then, within 30 days of filing, you must publish the statement in a newspaper of general circulation in Los Angeles County, once a week for four consecutive weeks. The newspaper gives you a proof of publication to file back with the county clerk.3Justia. California Business and Professions Code Chapter 5 – Fictitious Business Names 17900-17930
The publication step surprises people. Newspaper fees typically run $50 to $100, and the four-week cycle means your DBA isn’t fully on record until roughly six weeks after you file. If you need the fictitious name for a bank account or a contract, start early.
Get Your LA Business Tax Registration Certificate
Every person or entity doing business within Los Angeles city limits must get a Business Tax Registration Certificate from the city’s Office of Finance. This is the actual city business license, and it applies no matter how small the operation.5Los Angeles Office of Finance. Business Tax Information FAQ
The application asks for your legal business name, physical address, EIN or Social Security number, and a description of your business activities. That description determines your industry classification, which sets your tax rate. Los Angeles taxes businesses on gross receipts, and rates vary by classification: retail and wholesale fall toward the lower end, while professions and services pay higher.
You’ll also estimate first-year gross receipts. If your total worldwide gross receipts (taxable and nontaxable, in and out of the city) stay under $100,000, you qualify for the Small Business Exemption and owe no city business tax. The exemption doesn’t excuse you from registering. You still need the certificate, and you still have to file a timely renewal each year to keep the exemption.6Los Angeles Office of Finance. Small Business Exemption FAQ
Register promptly after you start operating. The Office of Finance adds penalties and interest for late registration and unpaid taxes, and failure to register exposes you to additional remedies beyond standard penalties.5Los Angeles Office of Finance. Business Tax Information FAQ
Check Zoning Before You Sign a Lease
Confirm that your intended activity is allowed at your address before you commit to a space. Los Angeles zoning can be restrictive, and the wrong location can end a business plan before it starts. The city’s Zoning Information and Map Access System (ZIMAS) is the lookup tool. Enter any address and you’ll see the zoning designation, which tells you whether your commercial activity is permitted outright, allowed only with a conditional use permit, or prohibited.7City of Los Angeles. Introductory Provisions – Article 1
Home-based businesses are allowed but tightly limited. The activity can’t be visible from outside, so no signage, window displays, or exterior evidence. You’re capped at one client visit per hour between 8 a.m. and 8 p.m., only one employee who doesn’t live at the home, no more than two deliveries or pickups per day, and no commercial vehicles stored on site.8LA Business Navigator. Home-Based Businesses Many home businesses outgrow these rules fast, so build a possible move to commercial space into your projections.
Industry-Specific Permits You May Need
Beyond the BTRC, specific industries carry their own permit requirements. These take longer to process than the basics, so start them early.
Seller’s permit. If you sell or lease tangible personal property in California, whether retail or wholesale, you need a seller’s permit from the California Department of Tax and Fee Administration. The permit is free, but CDTFA may require a security deposit based on your estimated sales volume to cover potential unpaid sales tax if the business closes. Any physical presence in the state (office, warehouse, sales rep, pop-up) counts as being engaged in business. Operations lasting 90 days or fewer at one location take a temporary seller’s permit instead. Pure service businesses generally don’t need one, but if a service produces a physical product for a customer, like a custom ring from a jeweler, sales tax applies to the finished item.9California Department of Tax and Fee Administration. Obtaining a Seller’s Permit
Food service. Restaurants, food trucks, and food producers need a Public Health Permit from the Los Angeles County Department of Public Health. The application requires floor plans with layout and equipment, specification sheets for ventilation and water heating, and finish details for floors and walls. Plans must be approved by both the Department of Public Health and your local building and safety office before the permit issues.10Los Angeles County Department of Public Health. How to Obtain a Restaurant Food Facility Permit
Alcohol sales. Selling alcohol requires a license from the California Department of Alcoholic Beverage Control. The ABC recommends checking with local zoning first, because your location may need a Conditional Use Permit from the city before the ABC will process your application.11Alcoholic Beverage Control. License Application Requirements
Fire safety. High-occupancy venues, businesses handling hazardous materials, and operations needing special fire clearances work with the Los Angeles Fire Department. The LAFD covers public assemblage inspections and hazardous materials oversight through its Certified Unified Program Agency, among other specialized units.
Professional and vocational licenses. Contractors, cosmetologists, accountants, real estate agents, and many others need a state-issued license from the relevant board under the California Department of Consumer Affairs. These must be in place before you advertise or perform work. Some boards have exam and experience requirements that take months to clear, so check your profession’s rules early.
If You’re Hiring: EDD and Workers’ Comp
Hiring even one employee triggers two more requirements immediately. You must register with the California Employment Development Department for a payroll tax account within 15 days of paying more than $100 in wages in a calendar quarter. Registration goes through the EDD’s e-Services for Business portal.12Employment Development Department. Employers – Payroll Tax Account Registration
You also need workers’ compensation insurance in place before any employee performs work. There’s no minimum employee count. The only exceptions are partnerships where only partners work and certain corporations where the officers are also the sole shareholders. Operating without coverage gets expensive fast: the state will issue a stop order halting all use of employee labor and impose a penalty equal to twice what you would have paid in premiums during the uninsured period, or $1,500 per employee, whichever is greater.13Department of Industrial Relations. Workers Compensation FAQ
ADA Compliance for Customer-Facing Spaces
If your business serves the public from a physical location (store, restaurant, office, salon, any space customers enter), the Americans with Disabilities Act applies, regardless of business size or building age. You must remove architectural barriers in existing facilities when doing so is “readily achievable” (meaning the cost is reasonable relative to your resources), make reasonable modifications to policies for customers with disabilities, and communicate effectively with customers who have vision, hearing, or speech disabilities.14ADA.gov. ADA Update – A Primer for Small Business
The ADA recommends tackling barriers in this order: access from sidewalks and parking, access to goods and services, access to restrooms, then other amenities. ADA lawsuits against small Los Angeles businesses are common. If you’re leasing commercial space, inspect for accessibility issues before signing and understand how the lease splits responsibility for ADA modifications between tenant and landlord.14ADA.gov. ADA Update – A Primer for Small Business
What You’ll Owe the State Each Year
California charges an annual minimum franchise tax of $800 on every LLC and corporation doing business in the state, regardless of income. It’s separate from income tax and continues every year until you formally dissolve or cancel the entity with the Secretary of State.15Franchise Tax Board. Limited Liability Company
Newly incorporated corporations get a first-year exemption from the $800 minimum.16Franchise Tax Board. Corporations California previously extended the same first-year waiver to LLCs, but that applied only to tax years beginning before January 1, 2024, so a new LLC forming in 2026 owes the $800 from year one.15Franchise Tax Board. Limited Liability Company
LLCs with higher revenue also pay a tiered annual fee on top of the $800. If total California income exceeds $250,000, the fee starts at $900 and climbs to $11,790 for income above $5 million.17Franchise Tax Board. FTB Pub 3556 – Limited Liability Company Filing Information The fee is based on total income, not net profit, which catches owners who assume their expenses offset it.
Every California LLC and corporation also files a Statement of Information with the Secretary of State. Corporations file annually in their registration month; LLCs file every two years. The Secretary of State sends a reminder about three months before the deadline. Miss it, and you get a delinquency notice and 60 more days to file before potential suspension.18California Secretary of State. Frequently Asked Questions
Keep Your Registrations Current
Los Angeles requires every business to file an annual tax renewal with the Office of Finance by the last day of February, regardless of whether the business earned anything that year. Filing late disqualifies you from the Small Business Exemption even if you’d otherwise qualify, which means you’d owe the full tax on your gross receipts.19Los Angeles Office of Finance. Renewal Deadlines, Forms and Online Services
At the state level, your Statement of Information must be on time, your $800 franchise tax is due each year, and if you have employees, EDD payroll tax filings are quarterly. Missing any of these triggers penalties, interest, and eventually suspension of your entity’s good standing, which blocks your ability to enforce contracts, file lawsuits, or keep your city registration active. Save every confirmation number and receipt. When an inspector or auditor asks for proof of registration three years from now, “I filed it online” isn’t a substitute for the actual record.