How Much Does It Cost to Start an LLC in California? (2026)
How Much Does It Cost to Start an LLC in California? (2026)
California LLCs are not free. An LLC organized in 2024 through 2026 costs at least $890 in its first year when the owner files online and uses the owner's own address as agent. That total is $70 for the Articles of Organization (Form LLC-1), $800 for the minimum annual franchise tax, and $20 for the Statement of Information (Form LLC-12). If the LLC earns enough California-source income, the LLC fee adds $900 to $11,790 per year.
This guide is informational content, not legal or tax advice. Fees and rules change, so confirm every figure on the agency pages linked at the end before you file.
Are LLCs Free in California?
No. Filing the entity with the state costs money, and the state charges an annual tax on every LLC whether or not it made a profit. California does not issue a general business license, so there is no separate state license fee on top of these costs. Your total depends on the entity filing, the franchise tax, the LLC fee if your income is high enough, and whatever local licenses or permits your city and industry require.
Secretary of State Filing Fees
The California Secretary of State's Business Programs Division handles LLC formation through bizfile Online at bizfileonline.sos.ca.gov. These are the one-time fees:
| Filing or service | Fee |
|---|---|
| Articles of Organization (Form LLC-1) | $70 |
| Name reservation (holds the name for 60 days, not renewable for consecutive periods) | $10 |
| Certified copy, per document | $5 |
| Certificate of status | $5 |
| Amendment | $30 |
| Foreign LLC registration (Form LLC-5) | $70 |
The LLC name must include “limited liability company,” “L.L.C.,” or “LLC.” “Limited” may be shortened to “Ltd.” and “company” to “Co.” The name cannot include “bank,” “trust,” “trustee,” “incorporated,” “inc.,” “corporation,” or “corp.” Check availability and reserve a name on the Secretary of State name availability page.
Processing Times and Expedite Fees
Online filings are normally processed within 5 business days or less. Paper filings, whether mailed or submitted as PDFs, take 10 or more business days. Paper filing is still available if you prefer it.
If you need speed, the Secretary of State charges these optional expedite fees:
| Expedite option | Fee | Conditions |
|---|---|---|
| 24-hour filing | $350 | Online or drop-off |
| Same-day filing | $750 | Must be received by 9:30 a.m. for a same-day response |
| 4-hour filing | $500 | Drop-off only and precleared |
| 24-hour preclearance | $500 | Drop-off only |
Drop-off requests also pay a special handling fee. Check the Secretary of State's service options page for the current schedule before you submit, because the handling fee is not included in the table above.
The $800 Minimum Franchise Tax
Every LLC organized or registered in California in 2024 through 2026 owes the $800 minimum annual franchise tax starting in its first taxable year. The first-year exemption covered only LLCs organized or registered from January 1, 2021 through December 31, 2023, so it does not apply to an LLC organized or registered in 2024 through 2026.
The first-year tax is due on the 15th day of the fourth month after the Secretary of State filing date. The Franchise Tax Board's own example is a filing on June 18, with the tax due September 15. Later years are due on the 15th day of the fourth month of the tax year, which is April 15 for a calendar-year LLC. An LLC formed late in the year has a short first year, so the next $800 payment can arrive within weeks or months.
An LLC whose first taxable year begins in 2027, 2028 or 2029 pays $400 in year one under RTC 17941(g)(2). Confirm the first-year amount with the Franchise Tax Board before you set your budget.
If you cancel within one year of organizing, you can file the short form cancellation (Form LLC-4/8) and avoid the $800 for that first tax year. Confirm the details with the Franchise Tax Board or a CPA before relying on it.
The LLC Fee Based on California Income
The LLC fee is based on total income from California sources, meaning gross income plus cost of goods sold, assigned to California. It is not based on gross receipts. The fee scales as follows:
| California-source total income | Annual LLC fee |
|---|---|
| $250,000 to $499,999 | $900 |
| $500,000 to $999,999 | $2,500 |
| $1,000,000 to $4,999,999 | $6,000 |
| $5,000,000 or more | $11,790 |
The LLC makes an estimated payment on Form 3536, due the 15th day of the sixth month of the tax year, and reconciles on Form 568. A late Form 568 carries a penalty of $18 per member per month for up to 12 months.
Statement of Information (Form LLC-12)
An LLC files its first Statement of Information within 90 days of registering. After that, it files every two years during the six-month window ending on the last day of the anniversary month. The fee is $20 each time.
If you miss the deadline, the Secretary of State sends a delinquency notice. If the statement is still not filed 60 days later, the Secretary of State certifies the name to the Franchise Tax Board, which assesses a $250 penalty. The LLC can ask for relief for reasonable cause under Corporations Code 17713.09. Since August 1, 2026, the Secretary of State requires web User Access to file a Statement of Information online. For the full filing steps, read our Statement of Information guide.
Out-of-State LLCs Doing Business in California
A Nevada, Delaware or other out-of-state LLC that does business in California must register with the Secretary of State on Form LLC-5 for $70 and pay the $800 minimum franchise tax. Forming the LLC somewhere else adds filing fees without avoiding the California tax. The Franchise Tax Board's 2025 doing business thresholds are $757,070 in sales, $75,707 in property, or $75,707 in payroll. These amounts adjust each year, so confirm the current figures with the Franchise Tax Board.
Fictitious Business Name Costs
If you operate under a name other than the LLC's exact legal name, you need a Fictitious Business Name Statement. File it with the County Clerk-Recorder in the county of your principal place of business, or Sacramento County if you have no principal place of business in California. You must file within 40 days of starting to do business, publish the statement in a newspaper once a week for four weeks, and renew it every five years.
The statutory filing fee is $10, plus $2 for each additional name or owner (Bus. & Prof. Code 17929). Counties charge more than the statutory amount. For example, Tehama County charges $31, plus $5 for each additional name. The newspaper publication fee is separate and varies by publication, so get quotes from local papers. Details are on the Secretary of State fictitious business names page.
Local Business Taxes and Licenses
The Secretary of State issues no business licenses or permits, and the CDTFA seller's permit is not a business license. Most California cities charge a local business tax or registration certificate. Of the 483 cities, 445 report revenue from one. There is no common formula, so the cost depends on your city. Counties license only regulated activities.
Regulated trades and professions need licenses from state boards, such as the Contractors State License Board, which sets the contractor license threshold at $1,000, and the Department of Consumer Affairs boards. Alcohol businesses deal with the Department of Alcoholic Beverage Control. Review our California business license guide to find the rules for your city and industry.
Sales Tax, Payroll and Other Registrations
- Seller's permit (CDTFA): Free. Required if you sell taxable goods. The statewide base sales tax rate is 7.25%, and with district taxes, city rates run from 7.25% to 11.75%. The resale certificate has no required form.
- EDD registration: Required if you have employees. Verify the state minimum wage before budgeting payroll: $16.90 in 2026 and $17.40 from January 1, 2027.
- EIN: Free from the IRS.
- Registered agent: Must be a California resident individual or a corporation holding a Corporations Code 1505 certificate. The LLC must also keep an office in California. The owner can serve as agent at no added cost, though the agent must meet these requirements.
Corporation Costs for Comparison
If you are considering a corporation instead, the Articles of Incorporation cost $100. A corporation files a Statement of Information (Form SI-550) for $25 within 90 days of filing the articles, then every year. A newly incorporated or qualified corporation or S corporation owes no $800 minimum tax in its first taxable year. California does not allow a domestic series LLC, and an LLC cannot render a licensed professional service, so professionals usually form a professional corporation.
Sample First-Year Budget
| Item | Cost |
|---|---|
| Articles of Organization (Form LLC-1) | $70 |
| Minimum franchise tax, first year (2024 through 2026) | $800 |
| Statement of Information (Form LLC-12) | $20 |
| Minimum first-year total | $890 |
| Name reservation (optional) | $10 |
| Fictitious business name (county statutory fee, plus publication) | $10 plus publication cost |
| LLC fee at $250,000 to $499,999 California-source income | $900 added |
Your local business tax, any professional license, sales tax registration and expedite fees come on top of this. Get the local figures from your city before you launch.
Frequently Asked Questions
Is there any free way to form an LLC in California?
No. The lowest filing fee is $70 for the Articles of Organization. Because the $800 minimum franchise tax applies to LLCs organized in 2024 through 2026, the first-year minimum is $890 when you file online and use your own address as agent.
Do I owe the $800 tax in my first year?
Yes, if your LLC was organized or registered in 2024 through 2026. The first-year exemption covered only LLCs organized or registered from 2021 through 2023. An LLC whose first taxable year begins in 2027, 2028 or 2029 pays $400 in year one under RTC 17941(g)(2), so confirm that with the Franchise Tax Board.
When is the first franchise tax payment due?
It is due on the 15th day of the fourth month after the Secretary of State filing date. If you file on June 18, the payment is due September 15.
Does the LLC fee apply in the first year?
It can. The LLC fee depends on California-source total income, not gross receipts. If your income reaches $250,000, the fee starts at $900. Estimate it on Form 3536 and reconcile it on Form 568.
Do I need a business license to start an LLC?
California has no general state business license. You may still need a city business tax registration, a county license for a regulated activity, or a license from a state board for your trade or profession. Check your city and your industry's licensing agency.
Can I expedite the filing?
Yes. The Secretary of State offers 24-hour filing for $350, same-day filing for $750 if received by 9:30 a.m., and 4-hour drop-off filing for $500. Drop-off requests also carry a special handling fee, so check the current schedule before you submit.
Do I need a separate bank account?
A separate business bank account keeps your records clean and makes bookkeeping and tax filing easier. This guide does not state that it is legally required to preserve liability protection. Ask an attorney or CPA what protects your personal assets in your situation.
Official Resources
- California Secretary of State, Business Programs Division
- bizfile Online
- Franchise Tax Board
- California Department of Tax and Fee Administration
- California Small Business Development Center network
For the rest of the formation process, read our guide to starting an LLC in California and our LLC taxes guide.
Disclaimer and When to Get Professional Help
This article is informational content, not legal or tax advice. Fees, thresholds and deadlines can change. If your situation involves multiple owners, out-of-state operations, a professional license, employees, or a high California-source income, consult a qualified California attorney and a CPA before you form the LLC or file your taxes.