Register your business in California

LLCs, corporations, nonprofits and limited partnerships register with the California Secretary of State. Sole proprietors and general partnerships don’t, though a business name may still apply.

What’s different in California

• Most LLCs owe the $800 annual tax from the year they form until they cancel, even with no sales. Stay compliant has the due dates and the narrow exceptions.
• Many licensed professions can’t use an LLC. California doesn’t let an LLC provide most services that need a state professional license, such as law, medicine or accounting. Insurance agents and brokers are an exception, and some boards set their own rules. Ask your board before you file.
• A business name (DBA) is a county filing, and it has to run in a local newspaper once a week for four weeks in a row.

Do this

1. Pick your structure. LLC, corporation, nonprofit, partnership or sole proprietorship. A sole proprietor or general partnership can skip to step 5.
2. Check the name. Search existing names in Business Search on bizfile Online. The state checks only against entities of the same type, so also search the federal trademark database. You can reserve a name for 60 days if you aren’t ready to file.
3. Choose an agent for service of process, the person or company that accepts court papers if the business is sued: you or another California resident, or a registered corporate agent. The business can’t be its own agent, and the agent’s name and street address become public.
4. File your formation document on bizfile Online. The form and fee depend on your structure (below). Online filings are reviewed first: 5 days or less, against 10 days or more on paper. The Secretary of State also charges $350 to guarantee a response in 24 hours or $750 for the same day.
5. File a Fictitious Business Name Statement if you’ll use another name. A sole proprietor needs one when the business name doesn’t include your last name. An LLC or corporation needs one for any name that isn’t in its articles. Partnerships have their own rules; your county clerk can tell you. File with your county clerk within 40 days of starting business; CalGold points you to your county’s office. Each county sets its own fee.
6. Publish the name in a newspaper in your county once a week for four weeks in a row, then file proof of publication with the clerk. State and county pages give different deadlines, so follow your county clerk’s.
7. Calendar the first deadlines. An LLC’s first $800 tax is due the 15th day of the 4th month after you file with the Secretary of State. LLCs, corporations and nonprofits file a first Statement of Information within 90 days of registering. Stay compliant has the rest.

By structure

LLC

File Articles of Organization (Form LLC-1): $70. Keep your operating agreement yourself; the state doesn’t file it.

Corporation

File Articles of Incorporation, General Stock (Form ARTS-GS): $100. Unlike an LLC, a new corporation pays no minimum franchise tax in its first taxable year, though first-year profit is still taxed.

Nonprofit

California has separate articles for public benefit, mutual benefit and religious nonprofits, each $30; the Secretary of State’s forms page lists them. California tax exemption is a separate request to the Franchise Tax Board: generally Form FTB 3500A if you have an IRS determination letter and no prior California exemption, otherwise Form FTB 3500. The FTB’s nonprofit page says which applies. Most charities must also register with the Attorney General's Registry of Charities and Fundraisers within 30 days of first receiving charitable assets, on Form CT-1 ($50), and renew every year. Hospitals, educational institutions and religious organizations are exempt by law; see the Attorney General’s registration page.

Partnership

A general partnership exists once two or more people go into business together; filing a Statement of Partnership Authority (Form GP-1) ($70) is optional. A limited partnership files a Certificate of Limited Partnership ($70) on bizfile Online. A limited liability partnership (Form LLP-1, $70) is only for certain professions, such as law, accounting and architecture. Limited partnerships and LLPs also owe the $800 annual tax. The Secretary of State’s entity types page covers each.

Sole proprietorship

No formation filing. If you don’t register another entity, you’re a sole proprietor automatically. You need the Fictitious Business Name Statement only if your business name leaves out your last name.

Formed in another state

An LLC or corporation formed elsewhere, such as in Delaware, still registers with the Secretary of State before doing business here and owes the same $800 minimum tax. An out-of-state LLC doing business here without registering can owe a $2,000 penalty.

What you get back

An LLC, corporation, nonprofit or limited partnership gets filed articles and a Secretary of State file number, which you’ll need for your EIN, bank account and Statement of Information. A sole proprietor or general partnership finishes with a business name filing, if it needs one. A county business name statement expires after 5 years.