Start Your California LLC​

Set up an LLC in California without the hassle.
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Benefits of opening an LLC in California

There are many reasons to form an LLC in California. Here are the main ones:

Legal protection in case of bankruptcy or lawsuits

Separation of personal and business assets 

Tax benefits: flexibility & pass-through taxation

Increasing credibility and trust for your business

How to form your California LLC with Tailor Brands

Check if your California LLC name is available 

Choose a registered agent for your LLC

Sit back and let us take care of the paperwork for you

How to start an LLC in California in 5 steps

Starting an LLC in California or any other state can be a stressful process, especially if you’re doing it for the first time and not sure what to expect. To help guide you through this process, we created this simple step by step guide, breaking down each step so that you can clearly understand what you need to do in each stage of the process.

  1. Name your California LLC
  2. Choose a registered agent
  3. File articles of organization
  4. Create an operating agreement
  5. Apply for an EIN

Step 1: Name your California LLC

California requires you to register the name of your business in order to form an LLC. The first thing you need to do is to run a California business entity name search to check in the Secretary of State business name database

This step is done to make sure the name you chose is unique. Your business name must be unique in order for you to be able to form an LLC in California.

Other requirements include:

  • Must be readily distinguishable: The name must be readily distinguishable from any other business name on file.
  • Must Include an LLC suffix: Your LLC name must include one of the following phrases or abbreviations: Limited Liability Co, Limited Liability Co, Ltd. Liability Company, Ltd. Liability Co., L.L.C., LLC.
  • Not confusing or similar to other names: The name cannot be confusing or similar to an existing name. For example, ‘Good Time Rest Home LLC’ and ‘Goodtime Rest Home LLC’ are too similar.
  • Can’t include restricted words: The name cannot include restricted words like: bank, trust, trustee, incorporated, corporation, inc., corp., insurer, insurance company, county, municipality, or department.

Step 2: Choose a registered agent​

The California registered agent must be identified in the Articles of Organization. The agent must:

  • Have a street address in the state. Your LLC can have a P.O. address, but you must have a registered agent with a physical street address in the state
  • Be available during regular business hours at the address provided
  • Accept all legal papers for the business, including the service of process for a subpoena and tax notices

 

The LLC can choose the services of any approved California registered agents or can use a registered corporate agent who is qualified with the California Secretary of State.

You can choose to designate yourself as the registered agent. But, keep in mind that if you do that, your information will be public. 

Step 3: File articles of organization

An article of organization is a key legal document containing basic information about your business, and filling it is one of the very first steps for forming an LLC.

California requires you to file Articles of Organization with the Secretary of State. You do this by simply filling out form LLC-1 entitled “Secretary of State Articles of Organization Limited Liability Company (LLC).” The last two pages of the form include instructions for filling out the form and submitting it.

State filing fees

The filing fee for your Articles of Organization is $70.00. You may pay for it by check or money order made out to the California Secretary of State. If you want a certified copy, it will cost $5.00 for the certification.

Requirements

You need to be sure you fill in form LLC-1 correctly or it will be sent back to you for correction and delay the process of operating your business as an LLC.

Include the following on the form:

  • The name of you LLC exactly as it appears on the California Secretary of State Records.
  • A complete street address, city, and ZIP code of the LLC’s designated California office. This is where all documents relevant to the LLC along with other business records must be kept.
  • The name of your registered agent. This can be either an individual who resides in California or who has a physical street address in California, or a registered corporate agent who is qualified by the California Secretary of State. 
  • How you will manage your LLC, either have a member managed or a manager managed LLC. If you are the sole member of your LLC, the default would be a member managed LLC.
  • The form must be signed by each person responsible for forming the LLC
  • A Cover Sheet that is included in the first page of the form.
 

How to file

California allows filing the Submission of the Cover Sheet and the Articles of Organization online or by mailing them or presenting them in person to the California Secretary of State in Sacramento. Submission online: Go to bizfile California. You must pay the fee with Mastercard or Visa

By mail to Secretary of State, Business Entities Filings, P.O. Box 944260, Sacramento, CA 94244-2600. You may pay by check or money order. Do not send cash. There is no extra handling fee

In person at the Sacramento office, 1500 11th Street, Sacramento, CA 95814. You may pay by check, money order, Visa, or Mastercard. In addition to the $70.00 filing fee, there will be an extra handling fee of $15.00. No matter how you file, if you want a certified copy, you need to submit your own copy and pay a $5.00 certification fee

Step 4: Create an operating agreement

In California, forming an LLC requires you to create and maintain an operating agreement. An operating agreement defines the roles and responsibilities of all members and goes a long way toward preventing future misunderstandings.

You don’t need to file the agreement with the Secretary of State, but the state does require the LLC to prepare one and maintain it at the office where the rest of the LLC papers are kept.

The agreement should include:

  • Percentage of ownership that is allocated to each member and how profits will be distributed.
  • How the LLC is structured and the responsibilities, rights, and roles of each member
  • How decisions will be made. Will your proposals need to be passed by unanimous or majority vote? Will voting power be provisional to ownership interest? Will all decision-making authority be given to just one person?
  • What will happen to the ownership interest of a member who wants to leave, files for bankruptcy, or gets a divorce?
  • How will it be handled if the owner wants to dissolve the LLC? How will the assets be divided?
 

The operating agreement should be updated whenever there is a new member or there are any other changes that need to be made so that the agreement will accurately reflect your current situation.

Important note: California requires you to create an operating agreement, even if you have a single member LLC that includes only yourself.

Step 5: Apply for an EIN

In California, like in other states, you would need to create an EIN (IRS Employer Identification Number). This is very beneficial from several reasons that will be explained below, so we consider it a must for every business owner.

An EIN is your Employer Identification Number required and issued by the IRS for all LLCs. It is a 9-digit number similar to your Social Security Number (SSN) but is used for business-related purposes only. As a business owner, you will need an EIN to open a business bank account, apply for a business loan, and to pay your business income taxes.

Note the EIN is filed with the IRS, and is not the same as your California Tax ID Number.

California LLC Formation: The Basics

This step-by-step guide details the steps and requirements you need to name your LLC in California.

There are different costs to form an LLC in California and maintain it. We’ve listed all of them in this post.

LLCs in California are required to file an annual report with the state. Learn more to avoid penalties.

A California registered agent is a mandatory step in your LLC formation process – learn more about it.

Why is Tailor Brands the Best LLC Service in CA

At Tailor Brands, we love nothing more than helping people start their business. We take care of the LLC filing and offer additional services so you can focus on launching and growing your business, while staying informed and compliant with state regulations.

Here’s why people choose to form their LLC with us:

Easy and intuitive

Our products are user friendly, all you need to do is answer a few questions about your business and let us take care of all the rest.

Friendly dashboard

Our platform is easy to use and is optimally designed to guide you through your LLC formation process and business journey.

Additional services

We offer more products to help you set and manage your business like registered agent, business licenses, and annual report.

Real Tailor Brands reviews, from real business owners

For more reviews from our customers, visit our reviews page.

FAQ

What is an LLC?

An LLC is a limited liability company, a common business structure for small and medium businesses that allows you to protect your business and separate it from your personal assets, while providing flexibility and tax benefits like pass-through taxation.

To form an LLC you will need to pay a $70 fee for filing the Articles of Organization with the California Secretary of State. In addition you will need to pay within a few months a $20 fee for filing a Statement of Information, and a $800 Franchise Tax. Some additional fees may incur depend on how you file it, and you may have other costs related to name reservation, DBA registration etc. 

These are the main steps to set up your LLC in California:

1: Name your California LLC
2: Choose a registered agent
3: File articles of organization
4: Create an operating agreement
5: Apply for an EIN

After that you will need to take care of additional aspect such as obtaining the required business licenses and permits, consider opening a separate bank account and more.

To dissolve your Alabama LLC, you must file a Domestic LLC Articles of Dissolution form found on the Secretary of State website. A filing fee of $100 is required by the Secretary of State, in addition to a minimum of $50 in legal recording fees. You must file a completed original and two copies to a Judge of Probate in the county where the original Certificate of Formation was filed.

Any LLC registered with the California Secretary of State must pay the $800 annual tax if they are officially classified to be doing business in California. This holds true if the business engages in transactions for financial gain in the state, commercially resides in the state or has California sales, property or payroll that exceeds a defined threshold.

Form a California LLC, Hassle-Free

This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness.