One of the most common surprises for new California LLC owners is the ongoing annual costs. Unlike some states, California charges significant fees just to keep your LLC in good standing. Here's exactly what to expect.
Every California LLC must pay a minimum $800 franchise tax to the California Franchise Tax Board (FTB) each year — regardless of whether your business made any money. This is due by the 15th day of the 4th month after your LLC is formed.
💡 XbyZ Tip: New LLCs formed on or after January 1, 2021 are exempt from the $800 tax for their first year. Take advantage of this waiver.
If your LLC earns over $250,000 in California gross receipts, you owe an additional fee on top of the $800 minimum:
Every LLC must file a Statement of Information (Form LLC-12) with the Secretary of State within 90 days of formation, then every 2 years thereafter. The filing fee is $20.
By default, a single-member LLC is taxed as a sole proprietor (Schedule C) and a multi-member LLC is taxed as a partnership. You can also elect S-Corp taxation to potentially reduce self-employment taxes.
XbyZ helps California LLCs stay on top of annual filing requirements and compliance. Starting at $299.
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