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If you’re a business owner in the Golden State, forming a limited liability company may offer several valuable benefits.
This guide provides a step-by-step walkthrough of starting an LLC in California, complete with costs and documentation requirements. We’ve also included some key findings from our recent survey of LLC owners to help you learn from their experiences, including their thoughts on whether hiring a professional LLC formation service was worth the money.
The listings that appear are from companies from which this website may receive compensation, which may impact how, where and in what order products appear. Not all companies, products or offers were reviewed in connection with this listing.
How To Create a California LLC in 5 Steps
The steps listed below for starting a California LLC are tailored for business owners completing the process themselves. If you hire an LLC service, however, that company may complete some or all of these steps for you.
Starting an LLC in California includes the following steps:
- Choose a name for your California LLC
- Appoint a registered agent
- File your articles of organization
- File your statement of information
- Get an employer identification number
While each state generally follows the same five steps for business formation, there are important differences. For example, in California, you’re legally required to file a statement of information every two years, which we’ll explain further below. Many states require a similar document, but it’s usually called an annual report.
1. Choose a Name for Your LLC
California law states that your LLC’s name must be unique (meaning it’s not already taken) and must accurately represent the company’s goods and services. Changing an existing LLC name slightly or adding different punctuation won’t make it a valid new name. You can check California’s online database to learn which LLC names are already registered and unavailable.
2. Appoint a Registered Agent
All California LLCs must have a registered agent. A registered agent is the person or agency legally responsible for handling important documents, such as tax notices. Business owners in California are allowed to serve as their own registered agent for free, or they can appoint a trusted individual or business for a fee.
While it may seem appealing to go the free route, keep in mind that the registered agent must be available during all business hours to receive important documentation, and in order to receive those documents, their address must be made public record. If you have concerns about availability or address privacy, you may consider hiring a third party for registered agent services.
3. File the Articles of Organization
The most important part of creating an LLC in California is filing the articles of organization, which you can do online through the state’s Bizfile portal. This process requires a one-time $70 filing fee.
Include this information in your LLC’s California articles of organization:
- Your LLC’s unique name, purpose and office address
- The registered agent’s name and address
- The number of managers or members
- Your signature and return address
4. File the Statement of Information
California’s statement of information, similar to other states’ annual reports, must have the most up-to-date details about your LLC’s managers, members and contact information. Unlike many other jurisdictions, businesses incorporated in California don’t file a statement of information annually. Instead, you’ll need to pay a $20 fee within 90 days of initially registering your LLC. After that, you’ll need to submit your statement of information and pay a $20 fee again every two years. You can only submit this information online through the Bizfile portal.
5. Get an Employer Identification Number
You can get an employer identification number from the IRS once your articles of organization are filed. Getting an EIN allows you to open a business bank account, hire employees, make contracts with vendors and more.
You can get your EIN through the IRS website Monday through Friday from 4 a.m. to 7 p.m. Pacific Time. The process only takes a few minutes and is free of charge.
How Much Does It Cost To Form an LLC in California?
The cost to form an LLC in California is $70 up front, which is the filing fee for your articles of organization. This is substantially cheaper than in states such as Massachusetts ($500), New York and Washington ($200 each). If you opt for expedited LLC filing in California, 24-hour service costs $350, and same-day service costs $750. You’ll also need to pay a $20 statement-of-information filing fee every two years and an $800 annual tax by the 15th day of the fourth month of the current tax year.
If your LLC makes more than $250,000 in a year, you’ll have to pay an additional LLC fee by the 15th day of the sixth month of the current tax year.
Here’s a summary of California LLC formation costs:
| Fee Type | Due Date | Fee |
|---|---|---|
| State Filing Fee | When you file the articles of organization. | $70 |
| Statement-of-Information Fee | Within 90 days of initially registering your LLC and again every 2 years, based on your LLC’s registration month. | $20 |
| Annual Tax | Every year on the 15th day of the fourth month from the date you registered your LLC with California’s Secretary of State. Example: If you registered your LLC on April 24, 2025, you’ll have until July 15 each year to pay your annual tax. | $800 |
| LLC Fee | This is due by the 15th day of the sixth month of the current tax year. You only need to pay this fee if your LLC’s income is more than $250,000. | $900 for income from $250,000 to $499,999 $2,500 for income from $500,000 to $999,999 $6,000 for income from $1 million to $4,999,999 $11,790 for income of $5 million or more |
What Is the Cheapest Way To Start a California LLC?
The cheapest way to form a California LLC is by handling the formation process yourself, paying fees on time and choosing standard processing times. Choosing expedited services will also increase LLC costs.
Hiring an LLC service could come with additional costs and even subscription fees. But the LLC formation, filing services and registered agent services, can be helpful to ensure you stay in compliance with the law.
Pros and Cons of Forming an LLC in California
Consider the following benefits and disadvantages when establishing an LLC in the Golden State.
Affordable state filing fee: California’s state filing fee is only $70, which is lower than many other states.
No annual fee: Instead of an annual report fee, California business owners only need to pay a $20 statement-of-information fee within the first 90 days and again once every two years that the LLC is active.
Liability protection: An LLC protects California business owners from the company’s potential debts and liabilities.
Tax consequences: California levies an $800 annual tax for LLCs.
Potential LLC fee: You’ll owe an additional fee (ranging from $900 to $11,790) if your LLC earns more than $250,000.
What To Do After Starting an LLC in California
Beyond the LLC formation process, there are other responsibilities to consider in order to ensure a thriving business in California.
Set Up a Business Banking Account
Many banks require you to get your EIN before opening a business bank account. This will help to keep your business funds separate from your personal income, which will protect you if your LLC faces legal trouble. Separating your personal and business accounts can also make accounting and tax filing easier.
Insure Your Business
Similar to investing money in a home, you invest money in your business, which means you want to ensure it’s protected. Buying business insurance can help mitigate risk from unexpected accidents or events where the LLC or the owner could be deemed liable.
Permits and Licenses
California business owners who sell or lease tangible property are required to get a seller’s permit, which you can register for online. Depending on your business activities and offerings, you may need other licences or permits. California’s Secretary of State has online resources to help you determine which licenses or permits you need.
LLC Formation Survey 2025: What We Learned
The MarketWatch Guides research team conducted a survey of 1,000 LLC owners in 2025 to learn about their first-hand experiences with the business formation process. Here are some of the most notable findings from that survey:
- Nearly all (96%) of respondents say they would recommend the LLC process to fellow business owners.
- The vast majority (74%) of respondents said they used an LLC formation service to help them register their companies.
- Respondents who used an LLC service to help them with the formation process were mostly happy with their service. Only 2% said they were either dissatisfied or very dissatisfied with the service they used.
- The most popular choice of LLC formation service was LegalZoom, accounting for 48% of survey respondents. ZenBusiness (9%), Northwest Registered Agent (7%) and Tailor Brands (6%) were the next most popular providers.
We also asked respondents what advice they would give to other business owners about navigating the LLC formation process. One of the most common sentiments was that people wished they had started the process sooner. Other popular themes of advice were:
- Look out for hidden fees
- Make sure to work with a reputable LLC company
- Prepare all your documents ahead of time
The listings that appear are from companies from which this website may receive compensation, which may impact how, where and in what order products appear. Not all companies, products or offers were reviewed in connection with this listing.
California LLC: Frequently Asked Questions
Here are some answers to frequently asked questions on how to start an LLC in California:
It generally takes two to five business days to process LLC filings in California. Online filings are usually processed faster than in-person or by-mail filings. You can view current processing times here.
Yes, you can form a California LLC if you’re the only owner or member. This is known as a single-member LLC.
A single-member LLC in California offers liability protection and tax flexibility, but it requires more paperwork and has additional costs, including a minimum $800 annual tax in addition to state and federal income taxes. A sole proprietorship is a simpler company structure and costs less to set up and maintain, but provides no personal asset protection.
Having an LLC in California is worth it for many business owners. The LLC structure provides asset protection and tax advantages that other business structures lack. With an LLC filing fee of only $70, California is one of the least expensive states for forming an LLC.
*Data accurate at time of publication.
Legal Disclaimer: This article contains general legal information but does not constitute professional legal advice for your particular situation and should not be interpreted as creating an attorney-client relationship. If you have legal questions, you should seek the advice of an attorney licensed in your jurisdiction.
