California LLC Taxes
Last updated:
California LLCs face the highest annual entity tax in the country: $800 franchise tax minimum, plus an additional LLC fee on gross receipts above $250,000.
The $800 minimum annual franchise tax
Every California LLC owes the $800 franchise tax to the Franchise Tax Board (FTB) every year, regardless of profitability or activity. Due date: the 15th day of the 4th month after the start of the taxable year (April 15 for calendar-year filers).
The income-based LLC fee
If gross receipts exceed $250,000, an additional LLC fee applies on top of the $800:
| Total California gross receipts | Additional 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 |
Federal taxation
By default, single-member California LLCs are disregarded entities and report on Schedule C of the owner’s personal return. Multi-member LLCs file Form 1065 (partnership). Either can elect S-Corp or C-Corp status with Form 8832 / 2553.
State income tax on members
California members pay state income tax on pass-through LLC income at ordinary rates (1% to 13.3%). Non-resident members pay California tax on income sourced to California.
Sales tax
Selling tangible goods or certain services in California requires a Seller’s Permit from the California Department of Tax and Fee Administration (CDTFA). Base state rate is 7.25% with local additions.
California LLC at a glance
| Item | Detail |
|---|---|
| Filing office | California Secretary of State |
| LLC filing fee | $70 |
| Annual report | $20, filed every two years |
| Franchise or entity tax | $800 minimum annual |
| State personal income tax | Yes |
| Corporation filing fee (for comparison) | $100 |
How California compares
California's LLC filing fee is $70, $30 below the national median of $100. 12 of the 51 jurisdictions (50 states and DC) charge less to file. Filing fees are only part of the picture, so the table below sets California beside five states founders often consider.
| State | LLC filing fee | Annual report | Franchise or entity tax |
|---|---|---|---|
| California | $70 | $20 every 2 years | $800 minimum annual |
| Delaware | $110 | $300 yearly | Franchise tax $300 LLC / variable corp |
| Wyoming | $100 | $60 yearly | None |
| Nevada | $425 | $350 yearly | Commerce Tax (revenue > $4M) |
| Texas | $300 | No fee yearly | Franchise tax (no-tax-due < $1.23M) |
| Florida | $125 | $138.75 yearly | None |
Forming outside the state where you live and work rarely saves money. A business operating in California that forms elsewhere generally still has to register as a foreign LLC in California and pay both states' fees. Our best states for an LLC guide explains when an out-of-state filing makes sense.
Frequently asked questions
Can I avoid the $800 California LLC tax?
When is the $800 California franchise tax due?
Does an LLC pay California income tax?
Sources & further reading
Disclaimer: Legal information, not legal advice. For advice about your specific situation, consult a licensed attorney or CPA in your state. See our full disclaimer.