Your California LLC name can identify the type of products and services your business will provide; or it may be the name of the founder; or it can be a combination of the two or something else.

In any case, the California LLC name that you choose must be distinguishable from the name of any other registered California LLC or other registered California business entity, such as a California Corporation or LLP.  The LLC name must also be different from any reserved names on record with the state of California.  Your California LLC name must not imply that it was formed for a purpose other than that stated in your Articles of Organization; and your California LLC name must not be a name that is likely to mislead the public.

The name of a California LLC must include the word "LLC" or "Limited Liability Company" or an abbreviation of one of these words.

It's important to choose a good name for your California LLC because if you want to change it after you Form a LLC in California you will have to file amended Articles of Organization with the California Secretary of State (and pay a fee).

Every California LLC must have an address that is physically located in the state of California.  This address is "registered" with the California Secretary of State.  The Registered Address is where official and legal correspondence can be delivered.

The individual or company that is registered with the state of California to receive all correspondence on behalf of the California LLC is called a "Registered Agent" or "Agent for Service of Process".  You may act as your own Registered Agent, however, many California LLCs hire a Registered Agent because they don't have a physical address within the state of California or to provide a distinct level of privacy.

The owners of a California LLC are called Members - not Partners or Shareholders.  (a California Limited Liability Company does not issue stock).  Members make all business decisions and realize the financial benefits generated by the California LLC.  Division of ownership and distribution of profits are decided by private agreement among the Members.  Each California LLC must have at least one Member.  Members need not live in the state of California or be citizens of the United States.

Managers are responsible for the day to day operation of the California LLC.  Members elect or appoint Managers and have the power to remove them.  Managers may or may not be Members of the California LLC.  Management for your California LLC may be defined in your Articles of Organization or, more commonly, in an Operating Agreement.

The IRS does not recognize a Limited Liability Company as a classification for federal tax purposes.  California LLC Members can elect for the IRS to tax the LLC as a sole proprietorship, partnership, C Corporation, or S Corporation.  This decision may be made after the California LLC is created.  If a single Member California LLC does not declare a tax classification it is taxed the same as a sole proprietorship.  A multiple Member California LLC that does not declare a tax classification is taxed as a general partnership.  More specific federal LLC tax information can be found at the IRS web site.

A California Limited Liability Company is a type of business that is authorized by the state of California - not by the federal government.  In order to form a LLC in California you must file Articles of Organization with the California Secretary of State. The Articles of Organization must include certain specific information about your California LLC.  If the Articles do not conform exactly to state of California requirements they will be rejected.  You may subsequently amend the Articles of Organization for your California LLC but you will have to pay a fee to the state of California in order to make the changes official.

A Federal Employer Identification Number, also known as a Federal Tax Identification Number, is used by the IRS to identify a business entity.  An FEIN is like a Social Security Number for your California LLC.  All California LLCs electing to be taxed as a C-Corporation or S-Corporation are required to have a FEIN.

If you do not elect to have your California LLC taxed as a Corporation you may still need to get a FEIN if it is composed of multiple members or if you plan to have employees.

If you plan to form a Single Member California LLC you may not need a separate FEIN for the LLC if you have no employees.  The sole Member of a Single Member California LLC may be able to use his or her Social Security Number instead of applying for an FEIN.  You may request a FEIN for your California LLC for banking or state tax purposes, but an FEIN may not be required for federal tax purposes depending on your business circumstances.

An Operating Agreement defines the rules by which your California LLC will operate.  It is the core document that is referred to when issues concerning your LLC need to be resolved.  Operating Agreements may include requirements for almost anything that involves the management and operation of your California LLC.  By having an Operating Agreement all Members will be provided with a clear set of rules they have agreed upon thus reducing the likelihood of disagreement in the future.

Items commonly included in an Operating Agreement for a California LLC:


Although an Operating Agreement is not required in the state of California, if you plan to form a multiple Member California LLC it is highly advisable to have one.  Having an Operating Agreement will save you a lot of time and money should conflict arise down the line.  As your California LLC grows over time, you may amend your Operating Agreement as necessary.

When your California LLC has an Operating Agreement your business will be governed by your own rules and not some canned business rules created by the state of California.

It's very important that you have a separate business bank account for your California LLC.  Mixing personal and business funds may get you in a lot of trouble with the tax man down the line.  It's a good idea to contact the bank before you open a business bank account for your California Limited Liability Company.  Specific requirements vary from bank to bank. 

In most cases you will need a FEIN, a copy of your California LLC Articles of Organization, and a resolution identifying authorized signers if those names are not listed in the Articles.

Note that forming a California LLC doesn't take the place of obtaining a business license, tax registration certificate, or other required business permits.  A California LLC merely creates an ownership structure that limits the owner's personal liability.  You may still need to take care of getting set up to do business with your local government.

Depending on the nature of the business and the location of your California LLC you may need to get one or more city business licenses or permits.  The business licenses or permits that are required for your California LLC vary depending on your business activities and the specific locations within the state of California in which you want to conduct business.

If your California LLC will be selling products in California you may be required to obtain a Reseller's Permit from the appropriate California state agency.  If your California LLC will be selling products in California you will also be responsible for all applicable local and state of California sales taxes if there are any.

All California LLCs are required to file an Initial Statement of Information with the California Secretary of State within 90 days after filing of the original Articles of Organization to register the new California LLC.

Failure to file the Initial Statement of Information may result in the administrative dissolution of the California LLC by the California Secretary of State.

All California LLCs are required to file a Biennial Statement of Information with the California Secretary of State EVERY TWO years.

The CA LLC Biennial Statement of Information is due by the end of the anniversary month of the initial filing of Articles of Organization with the California Secretary of State.

A California LLC must file a Biennial Statement of Information with the CA Secretary of State even if the California LLC has done no business in the state of California during the prior reporting period.

In addition to the CA LLC Biennial Report, a California LLC may be required to pay an Annual Franchise Tax to the California Franchise Tax Board EACH year. The minimum Annual California LLC Franchise Tax is $800.

If a California LLC does not file its LLC Biennial Statement of Information by the due date then the CA Secretary of State will impose a late filing fee on the California LLC and will eventually administratively dissolve the CA LLC.