How to Set Up an LLC in California

By Michele Vrouvas

While the most seasoned corporate attorney may not be able to predict what type of business structure best fits your company’s goals, he can tell you about the advantages of the limited liability company model. Those advantages include being able to choose the type of taxation and the liability of LLC owners, known as members. Like other states, California LLCs decide for themselves how to divide company profits and losses among members. One distinctive requirement of California limited liability companies is that they form operating agreements that clearly define their management plan.


Step 1

Decide who among the organizers will run the LLC. Develop an operating agreement that explains how managers will conduct business. Maintain the operating agreement at the same office where the LLC keeps its corporate records.

Step 2

Contact the Department of Consumer Affairs, or access its website, to determine whether the LLC’s services are classified as professional services. LLCs in California are not permitted to perform professional services.

Ready to start your LLC? Start an LLC Online Now

Step 3

Choose a name that does not include restricted words. Prepare a name availability inquiry letter and mail it to the California Secretary of State. Ask for verification that the LLC’s name is not currently in use.

Step 4

Designate a registered agent to receive legal paperwork for the company. If designating an individual, make sure the agent resides and maintains an office in the state. If designating a corporation, make sure the corporation has already filed a certificate pursuant to Corporate Code 1505 that it is authorized to do business in the state and is currently in good standing with the Secretary of State’s office.

Step 5

Request an employer identification number with the IRS. File online at the IRS’s website. Or, request one by phone, fax, or mail.


Step 1

Complete the Articles of Organization Form LLC-1 online by accessing the fill-in-the-blank form at the secretary of state’s website, or download and print the form. Send it with applicable fees to the Document Filing Support Unit of the Secretary of State. You can also deliver the completed form in person to the secretary of state’s Sacramento office. Include the company name, registered agent and employer identification number. If you are limiting or restricting the LLC’s business, the secretary of state recommends that you explain those restrictions in a separate statement filed with Form LLC-1. Have the document signed by an attorney, member of the entity or a trustee.

Step 2

File a Statement of Information Form LLC-12 within 90 days of submitting the articles of organization. Plan to file Form LLC-12 every two years to update the secretary of state’s records with the names of the LLC’s most current operating officers and addresses of its managers.

Step 3

File an Application to Register Form LLC-5 if the LLC was not created in California. Submit a Certificate of Good Standing that was issued within six months of your filing by the state agency where the company was formed. When completing Form LLC-5, make sure to use the same company name, date and place of formation as stated on the Certificate of Good Standing.

State Taxes and Workers' Compensation Insurance

Step 1

Request a California employer account number if your company will be hiring at least one employee who earns $100 in a three-month period. Register online at the Employment Development Department’s website (see Resources), or call 888-745-3886. You can also visit an employment tax office to request a payroll tax registration form.

Step 2

Find an insurer that offers workers’ compensation insurance. Call the Workers’ Compensation Insurance Rating Bureau (WCIRB) at 888-229-2472 and ask which insurer offers policies in your LLC’s specific industry.

Step 3

File tax forms to pay the state’s required $800 minimum franchise tax. File California Form 100 if your LLC is classified as a corporation, or Form 568 if classified as a partnership. Access the California Franchise Tax Board’s website to find out about payment guidelines for each form, or call the Franchise Tax Board at 800-338-0505.

Ready to start your LLC? Start an LLC Online Now
How to File an LLC in California



Related articles

How to Set Up an LLC in Florida

Limited liability companies can be found in each state of the United States including Florida. The LLC form of business organization provides owners and partners with limited liability protection and unique tax advantages. The Florida Department of State Division of Corporations handles official LLC filings for the state and provides online templates for the articles of organization — the official registration document for LLCs.

How to Fill Out DBA Forms

DBA is short for "doing business as." Sole proprietors and even larger companies may elect to operate under DBAs or fictitious names for a variety of reasons. DBA registration forms are filed with the County Clerk or Secretary of State for the state in which a business is located. Because the filing procedure is different in every area, the requirements for filling out DBA forms vary, although most forms require similar information and can be filled out in a matter of minutes.

How to Apply for an LLC in Texas

An LLC is a business entity that offers a corporation's protection of limited liability for its owners, known as members, combined with a partnership or sole proprietor's operating flexibility. To create a Texas LLC, you must file a certificate of formation with the Texas Secretary of State. The secretary of state provides Certificate of Formation form 205, which meets minimum state law requirements.

LLCs, Corporations, Patents, Attorney Help

Related articles

How to File Articles of Incorporation in California

To register your new corporation with the state of California, you must file the articles of incorporation with the ...

How do I Rename a California LLC?

If you've already gone through the process of registering your LLC with the state of California, then you should ...

How to Find a Company's EIN

An Employer Identification Number for a business entity is analogous to a Social Security number for an individual. The ...

How to Change From Sole Proprietor to LLC Business

Changing your business from a sole proprietorship to a limited liability company, or LLC, is accomplished by complying ...

Browse by category
Ready to Begin? GET STARTED