Key Takeaways

  • A C Corp California formation requires filing Articles of Incorporation, appointing a registered agent, and submitting a Statement of Information within 90 days.
  • C corporations must maintain bylaws, issue shares, and keep accurate meeting minutes and stock records.
  • Annual franchise taxes and corporate income tax apply, even for inactive corporations.
  • Local business licenses and payroll tax registrations are mandatory for compliance.
  • California allows online filing through BizFile Online for faster processing.
  • Foreign corporations expanding into California must file a Statement and Designation by Foreign Corporation.
  • Dissolving or closing a C Corp in California requires filing final returns and a Certificate of Dissolution with the Secretary of State.

A California C corp is a particular type of business entity, also called a C corporation, formed in the state of California. As the default business structure for companies in California, C corps are the most common. 

How to Form a California C Corp

The requirements for starting a C corp vary from state to state. However, you'll need to follow these basic steps:

  1. Choose a name for the C corp and reserve it through the California secretary of state (SOS) website.
  2. File articles of incorporation.
  3. Choose a registered agent.
  4. Obtain an Employer Identification Number (EIN).
  5. Check the California SOS website to see what additional requirements there are for C corporations formed in the state and be sure to comply. 

Failure to form your California C corporation properly could result in the dissolution of the company or the loss of liability protection.

California C Corp Basic Requirements

The basic requirements for a C corp formed in California are as follows:

  • C corporations need to have a minimum of three directors if corporate shares have to be distributed. If shares have not been distributed or the corporation only has one or two shareholders, then you'll only need one or two directors.
  • There is no age requirement for corporate directors.
  • Directors do not need to be California residents.
  • Your corporate directors should be named in the company's bylaws or articles of incorporation.
  • State the number of your corporation's directors in either your bylaws or your business's articles of incorporation.
  • There is no limit for the number of shareholders allowed in a C corp.
  • Shareholders of a C corp can be individuals or other business entities and do not need to be U.S. citizens or residents.

California Corporate Name

You'll want to choose an entirely unique name for your company and be sure that it follows the requirements of the state:

  • The name cannot be the same as or similar to any other registered business names in the state.
  • The name must be understandable and straightforward. You'll want it to accurately represent your business. For instance, you can't name your company "Ben's Ice Cream Shop" if you are actually a hair salon.
  • The company name must include the word “Corporation,” “Company,” “Incorporated,” “Limited,” or an abbreviated version of the word.  

You can head to the California Secretary of State website to find out if the name you want is available for use. 

If you find the name you want to use is available, you can reserve it for up to 60 days by filling out a form and paying $10 to be sure no one else takes it while you're getting the company started.

California Articles of Incorporation

The articles of incorporation for your company will need to be filed with the SOS to start up the business. 

California articles of incorporation must include the following information:

  • The number of shares the corporation plans to issue (must be greater than zero)
  • Available classes of stock
  • Corporate office address.

You'll also be required to pay a $100 fee for filing these documents via mail or in person at the SOS office.

A statement of information must be sent to the California Department of State up to 90 days after you've filed the company's articles of organization. This statement will need to be filed annually within the same month the company was formed to maintain a status of good standing with the state.

Foreign C Corporations Doing Business in California

Foreign corporations—that is, companies incorporated in another state or country—must register with the California Secretary of State before transacting business within the state. To do this, they must file a Statement and Designation by Foreign Corporation (Form S&DC-S/N) and provide:

  • The corporation’s name and jurisdiction of incorporation.
  • The address of the principal executive office.
  • The name and street address of the registered agent in California.
  • A certificate of good standing from the home state, issued within the last six months.

Once registered, the foreign C corp must comply with all ongoing requirements, including filing annual Statements of Information and paying the $800 franchise tax each year. Failure to register or maintain compliance can result in fines or suspension by the Franchise Tax Board.

California Registered Agent

California C corps are required to choose a registered agent to receive any official documents on behalf of the business. This could include the following types of correspondence:

  • Legal documents (warrants, service of process, etc.)
  • Tax documents
  • Government notices.

The registered agent will need to be available during regular business hours every day of the week, so that no important documents are missed. This agent's name and address must also be included in the articles of incorporation. 

Corporations cannot be their own registered agents, and these individuals or companies must have a physical street address in California (no P.O. boxes).

Changing or Resigning a Registered Agent

If a corporation wishes to change its registered agent or the agent resigns, it must file a Statement of Information (Form SI-550) or a separate Statement of Change of Address of Registered Agent. The new agent must consent in writing to the appointment.

Failing to maintain a valid registered agent can cause a lapse in good standing or even administrative dissolution. For corporations using a professional registered agent service, updates are typically handled online through BizFile Online, minimizing the risk of missed service of process.

California EIN

All California C corps are required to obtain an Employer Identification Number (EIN). This is like a social security number for the company. It will be necessary for tax documents and opening a business bank account. A business owner can register for an EIN online or via mail.

California C Corp Tax Accounts

After obtaining an EIN from the IRS, a C Corp California must set up state-level tax accounts. The Franchise Tax Board (FTB) and Employment Development Department (EDD) oversee these requirements:

  • FTB Account: For corporate income and franchise taxes.
  • EDD Account: Required if the corporation has employees and must withhold payroll taxes.

Corporations should also register with the California Department of Tax and Fee Administration (CDTFA) if they sell goods or services subject to sales tax. This ensures proper collection and remittance of state sales tax and allows participation in California’s electronic filing systems.

Statement of Information Filing

California C corporations must file an initial Statement of Information (Form SI-550) within 90 days of submitting the Articles of Incorporation. This filing must include:

  • The names and addresses of the corporation's officers and directors
  • The registered agent's address
  • The general business description

After the initial submission, corporations are required to file a Statement of Information annually. This ongoing filing must occur during the same calendar month in which the Articles of Incorporation were initially filed, or within the preceding five months. The filing fee is currently $25. Non-compliance may result in penalties and possible suspension by the Secretary of State.

California Corporate Bylaws

Though not submitted to the state, corporate bylaws are internal documents required for legal compliance. They outline the corporation’s governance structure and should include:

  • Procedures for electing directors and officers
  • Meeting protocols for the board and shareholders
  • Rules for issuing shares and handling stock transfers
  • Voting rights and quorum requirements

The bylaws should be adopted at the first board meeting and maintained with the corporate records. They serve as an operational roadmap and are essential if legal disputes or audits occur.

Issuing Stock and Maintaining Corporate Records

California corporations must formally issue stock to shareholders. This includes:

  • Approving the number and type of shares through a board resolution
  • Recording shareholder names and ownership percentages
  • Providing stock certificates, if desired

C corporations are also expected to maintain accurate corporate records, such as:

  • Meeting minutes for shareholder and board meetings
  • Resolutions passed by directors or shareholders
  • Financial statements and stock issuance logs

These documents help demonstrate that the corporation is operating separately from its owners, which is critical to maintaining limited liability protection.

California Franchise Tax and State Income Tax

Every C corporation in California is subject to the state's annual minimum franchise tax of $800, regardless of profitability. Corporations must also file Form 100 (California Corporation Franchise or Income Tax Return).

Key considerations:

  • The standard corporate income tax rate in California is 8.84% of net income.
  • Corporations must file Form 100 by the 15th day of the 4th month after the close of their fiscal year.
  • Failure to file and pay on time can result in penalties and interest.

Corporations can pay their taxes online via the California Franchise Tax Board website.

Additional California C Corp Tax Considerations

Beyond the flat 8.84% corporate income tax rate, C corporations may face other state and local obligations, including:

  • Alternative Minimum Tax (AMT): Applies to certain corporations based on adjusted gross income, at a rate of 6.65%.
  • Estimated Tax Payments: Corporations expecting to owe over $500 must make quarterly estimated payments to avoid penalties.
  • Franchise Tax Waiver: Newly formed or qualified corporations are exempt from the $800 minimum franchise tax for their first taxable year, but the exemption does not extend to subsequent years.
  • Local Business Taxes: Some cities, such as San Francisco, assess additional gross receipts or payroll expense taxes.

Corporations that fail to pay these obligations may face FTB suspension, resulting in loss of rights to enforce contracts or bring lawsuits in California courts.

Business Licenses and Local Permits

Depending on where your C corporation operates, you may need a business license from the city or county. For example:

  • San Francisco, Los Angeles, and San Diego require business registration.
  • Some municipalities impose gross receipts taxes or additional license fees.

Check with the local city hall or county clerk to determine specific licensing requirements. Operating without the proper permits may result in fines or forced closure.

Environmental and Industry-Specific Permits

Depending on the type of business, California C corporations may need specialized permits in addition to standard business licenses. Examples include:

  • Environmental Permits: Required for corporations involved in manufacturing, waste management, or hazardous materials handling, issued by the California Department of Toxic Substances Control (DTSC).
  • Professional Licenses: Professions such as law, medicine, and architecture require approval from state boards before operating under a corporate structure.
  • Health and Safety Permits: Applicable to food service, childcare, or healthcare corporations through local county health departments.

Businesses should verify all applicable local, state, and federal regulations before operations commence to avoid delays or fines.

Registering for California State Payroll Taxes

If your C corporation hires employees, you must register with the California Employment Development Department (EDD) for payroll tax purposes. Employers must withhold and remit:

  • Unemployment Insurance (UI)
  • Employment Training Tax (ETT)
  • State Disability Insurance (SDI)
  • Personal Income Tax (PIT)

Registration can be completed online through the EDD’s e-Services for Business portal.

Online Filing and Compliance Resources

California offers an online filing system—bizfileOnline.sos.ca.gov—for many corporate forms. This platform can be used to:

  • Reserve a business name
  • File Articles of Incorporation
  • Submit the Statement of Information
  • Download forms and instructions

Using this platform simplifies compliance with California corporation filing requirements and accelerates processing times.

Maintaining Good Standing and Annual Compliance

To remain in good standing, a C Corp California must continue to meet both state and federal compliance obligations. Key requirements include:

  • Filing annual Statements of Information with the Secretary of State.
  • Paying all state franchise taxes and fees to the FTB.
  • Holding regular board and shareholder meetings and recording minutes.
  • Renewing local business licenses annually.
  • Keeping a California street address on file for service of process.

Failure to meet these requirements can lead to administrative suspension or forfeiture of the corporation’s status, which can affect banking, contracts, and legal liability protection.

Corporations can check their standing and file required documents using the BizFile Online Portal, which provides real-time confirmation and reduces processing time compared to mail filings.

Dissolving or Closing a California C Corporation

If a C corporation decides to cease operations, it must complete a formal dissolution to avoid ongoing tax liability. The process includes:

  1. Filing a Certificate of Dissolution (Form DISS STK) with the Secretary of State.
  2. Filing final tax returns with the Franchise Tax Board (Form 100 and Form 109).
  3. Paying any outstanding taxes, fees, or penalties.
  4. Notifying creditors and closing all state accounts, including sales and employment tax accounts.

Failure to dissolve properly means the corporation will continue to accrue the annual $800 franchise tax. Once approved, the corporation will receive a Certificate of Status confirming its closure.

Frequently Asked Questions

  1. What is the cost to start a C Corp in California?
    Filing the Articles of Incorporation costs $100, plus a $25 initial Statement of Information filing fee. Additional fees apply for name reservations or certified copies.
  2. How long does it take to form a C corporation in California?
    Online filings are typically processed within 1–3 business days, while mailed submissions may take up to two weeks.
  3. Can one person form a C corporation in California?
    Yes. California allows single-person corporations, meaning one individual can act as the sole shareholder, director, and officer.
  4. Do foreign corporations pay the $800 franchise tax?
    Yes. All corporations doing business in California—domestic or foreign—must pay the minimum franchise tax each year.
  5. How can I check if my C Corp California is in good standing?
    You can verify your corporation’s status on the California Secretary of State’s Business Search Portal by name or entity number.

If you need help with c corp california, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.