California LLC Costs — What You'll Actually Pay

Getting your LLC on file with the California Secretary of State is a single, predictable charge. You file the Articles of Organization (Form LLC-1) through the bizfile Online portal, and the state collects its filing fee at that point. The receipt card on this page shows the current amount — we keep the displayed figure matched to what the state actually charges rather than quoting a number in the text that could go stale.

Optional formation add-ons

• Expedited processing: Standard online filings take a few business days. If you need it faster, the Secretary of State offers paid expedited handling, including same-day service, for an additional fee.
• Name reservation: If you want to hold your name before filing, a name reservation carries a small separate state fee.
• Certified copies: If a bank or a lender wants a certified copy of your filed Articles, the state charges a small fee per copy.

None of these are required to form the LLC. The Articles filing is the only mandatory formation cost with the state.

This is the cost that makes California expensive, and the one new owners most often miss. Every LLC registered or doing business in California owes a minimum annual franchise tax to the Franchise Tax Board. It is due whether or not the business made a dollar of profit, and it recurs every year for as long as the LLC exists.

No more first-year waiver

California temporarily waived the minimum franchise tax for an LLC's first year, but that exemption has expired. New LLCs owe the tax starting in their first year. If you form late in the year, you can end up owing the tax for that partial year and again shortly after for the next — a timing quirk worth discussing with a CPA.

It goes to the FTB, not the Secretary of State

This tax has nothing to do with your formation filing. It is a separate obligation to a separate agency, which is why it is easy to overlook. Mainstay Filing does not collect or pay the franchise tax; that is between you and the Franchise Tax Board.

On top of the minimum franchise tax, California imposes an additional LLC fee once your California-source gross receipts pass certain thresholds. Unlike the flat minimum tax, this fee is tiered — it scales up in brackets as gross receipts climb, and at the highest revenue levels it becomes a meaningful annual number.

Two things to understand about it:

• It is based on gross receipts, not profit. A high-revenue, low-margin business can owe the tiered fee even in a thin year, because the fee keys off total California receipts rather than what is left after expenses.
• It is in addition to the minimum franchise tax, not instead of it. Companies past the threshold pay both.

If your California revenue is modest, you likely only face the minimum franchise tax. If your revenue is substantial, model the tiered fee into your budget with your accountant so it does not surprise you at tax time.

Beyond the franchise tax, a handful of smaller recurring costs come with a California LLC.

Statement of Information

California LLCs file a Statement of Information (Form LLC-12) — an initial one within 90 days of formation, then every two years. It carries a modest state filing fee each cycle. It is an informational update of your addresses, agent, and management, not a financial report.

Registered agent service

If you use a commercial agent for service of process rather than serving yourself, that is typically an annual service cost. Many owners consider it worthwhile for privacy and reliability, especially out-of-state owners who need a California address. If you form through Mainstay Filing, the agent isn't a separate line at all — it's part of the single flat yearly fee that also covers your filings.

Local licenses and permits

Most California cities and counties charge for a local business license or tax certificate, and many renew annually. If you sell taxable goods, a seller's permit from the California Department of Tax and Fee Administration comes with its own requirements. These vary by locality and industry and are separate from anything the state charges to maintain the entity.

Fictitious Business Name (if used)

If you operate under a DBA, the county FBN filing and the required newspaper publication are additional costs, and FBN registrations expire and must be renewed periodically.

Put it all together and the honest picture looks like this: a modest one-time state filing fee to form, a recurring minimum franchise tax every year no matter what, possibly a tiered LLC fee if your revenue is high, a small biennial Statement of Information fee, and any commercial agent, local license, and DBA costs that apply to your situation.

Where owners go wrong

The formation filing is the smallest and most visible cost, so it anchors people's expectations. The recurring franchise tax is larger, less visible, and easy to forget — and it is the one that actually determines whether a California LLC is worth it for a very small or dormant business. If you are forming an LLC that will not generate much income, run the math on the annual franchise tax first, because it applies regardless of activity.

What Mainstay Filing charges

We charge one flat yearly fee, and it covers everything we do: preparing and filing your Articles of Organization, serving as your agent for service of process all year, every year, and preparing and filing your Statement of Information when it comes due. There is no separate agent renewal and no one-time-only formation price — the same single fee simply renews each year. The receipt card reflects exactly what you pay, with the state's own charges passed through at cost; the Franchise Tax Board's taxes remain between you and the FTB.