California LLC Formation

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Steven S.

Steven Stark

336 reviews
For over 30 years, Steven Stark has offered counsel to non-profit organizations and private companies. He has a passion for helping small businesses in particular since he himself started several businesses of his own in New York and Florida. He understands the importance of small businesses having a reliable attorney to advise them about legal matters from their inception.
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Richard G.

Richard Gora

180 reviews
Looking for an attorney with experience? Richard Gora is the exact attorney you want. Having defended over 100 cases both in state and federal courts and working with clients from around the globe, Richard has an array of different experiences. His services are wide-ranging and include business litigation, securities litigations, employment litigation, and business counsel. Prior to founding Gora LLC, he worked for Finn, Dixon & Herling LLP for eight years.
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Joshua G.

Joshua Garber

235 reviews
Representing notable clients like Tesla and the City of Los Angeles, Josh Garber excels at helping clients with employment and labor laws. Many of his past clients have had great success using Josh for employment agreements and Division of Labor Standards Enforcement (DLSE) hearings. With his practical advice, he has even helped clients avoid going to court.
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Mark Y. L.

Mark Y. Liu

Mark is a corporate and transactional attorney specializing in capital markets, mergers and acquisitions, private equity, and venture capital financings. He advises companies in a variety of corporate transactions including initial public offerings on the NYSE and Stock Exchange of Hong Kong. Mark also guides companies in developing and implementing corporate governance and compliance programs.
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Terri L.

Terri Lubaroff

Tina Lubaroff provides mediation and facilitation for the legal, business, and entertainment communities. She has mediated conflicts in the areas of contract disputes, lemon laws, ADA complaints, and construction disputes. Tina is highly specialized in film, television, on-set entertainment disputes, music, art, new media, and agency-talent disputes. Tina is also an ABA trained arbitrator.
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Pauline I.

Pauline Isidro

Pauline Isidro handles transactional matters and specializes in estate planning and business law. She is also a veteran of the public relations industry. As a trained mediator volunteering with the Superior Court of California (Small Claims and Probate), Pauline has mediated disputes relating to commercial transactions, personal injury matters, and probate cases.
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Simran S.

Simran Singh

1 review
Beginning her practice in corporate law, Simran Singh has since expanded into estate planning, Chapters 7 and 13 bankruptcy, and small business law. She has experience handling all aspects of corporate formation, securities regulations, wills, living trusts, guardianships, powers of attorney, advance health care directives, and deed transfers for California properties.
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Paul M.

Paul Miailovich

1 review
Paul Miailovich is an attorney at law who has been serving corporate clients for the past three years. He is licensed to practice law in Idaho. Paul received his Juris Doctorate degree in law from the Southwestern Law School. He primarily specializes in labor and employment law. Paul is also experienced in legal research and writing. Paul has been serving as a partner and trial attorney at Reaffirm Law, LLP, since June 2017.
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Alexandra F.

Alexandra Frumar

2 reviews
Representing technology companies in structuring, drafting, negotiating, and commercial transactions, Alexandra Frumar supports her clients with everything from strategic alliances to cloud computing issues. Ms. Frumar favors an approach that allows her to become part of her clients’ teams to understand their business models, technology, and goals.
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Jillian S.

Jillian Sidoti

Jillian specializes in a range of transactional legal matters such as private placement memorandums, trademarks, and copyright. Before her legal career took off, she owned and operated a record label which enabled her to tour worldwide with artists. She also speaks at seminars educating real estate investors on how to legally raise capital for their real estate investment projects.
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Why use UpCounsel to form your LLC in California?

Confused by complicated questionnaires and government forms? Want to get your questions answered by a real attorney? UpCounsel provides personalized legal services with experienced attorneys to help form your California LLC the right way.
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Why use UpCounsel to form an LLC in California

Starting an LLC in California with a business startup attorney on UpCounsel is easy, informative, and cost-effective. In just three simple steps, our LLC attorneys will help you protect your business and personal assets, and help you organize your business for state and federal compliance for limited liability companies.

When forming an LLC in California with UpCounsel, the attorney you choose to help you will conduct a business name search for your California LLC and assist you in preparing your LLC Operating Agreement, along with providing other legal services based on your needs. Once your Articles of Organization have been prepared and successfully filed with the California Secretary of State, your California LLC has been formed and begins its existence as a corporate entity.

Requirements for Forming a California LLC

Choosing a Company Name for Your LLC

One of the first steps in the process of forming your California Limited Liability Company is to choose your business name.

The business name that you choose must contain the words "limited liability company" or the abbreviation "LLC" or "L.L.C." as the last words in the name of the limited liability company. The words "limited" and "company" may be abbreviated to "Ltd." and "Co.", respectively.

It must be distinguishable (not the same as or deceptively similar to) the name of any California Limited Liability Company or foreign LLC reserved or registered and cannot contain the words "bank", "trust", "trustee,""incorporated", "inc.", corporation", or "corp.", or "insurer" or "insurance company" or any other words suggesting that it is in the business of issuing policies of insurance and assuming insurance risks.

Your LLC name may contain the name of one or more members.

By using UpCounsel, you can choose several business names in order of preference. Your attorney of choice can then conduct a name check for your California Limited Liability Company before filing to see which names are available. Once you have chosen an available name, your chosen LLC attorney can help you properly register your name with the State of California.

Articles of Organization: When forming an LLC in California, the Articles of Organization must be filed with the Secretary of State. California state law requires that certain information be included in your Articles of Organization when forming your California LLC.

This information must include:

  1. The LLC name
  2. The following statement: "The purpose of the limited liability company is to engage in any lawful act or activity for which a limited liability company may be organized under the California Revised Uniform Limited Liability Company Act." This is important because as of January 1, 2014, the California Revised Uniform Limited Liability Company Act replaced the Beverly-Killea Limited Liability Company Act.
  3. The name and address of the initial registered agent for service of process on the LLC unless a corporate agent is designated, in which case only the name of the agent shall be set forth.
  4. A statement clarifying whether the LLC is to be managed by one or more managers and/or by its members.

State Filings: Your LLC is considered organized once the Articles of Organization are delivered to the California Secretary of State, and the articles are deemed to be in compliance with the state of California requirements. One certified copy of the Articles of Organization will be issued, and the other certified copy will be returned to the organizer or members. Within 90 days after filing the Articles of Organization, you must file a Statement of Information with the State (Form LLC-12). This also must be re-filed every 2 years.

Additionally, a California LLC formation generally requires inclusion and/or consideration of the following:

Organizers: One or more people may form a LLC, yet they do not need to be members of the LLC.

Minimum Number of LLC Organizers: One (or more).

Eligibility: An organizer may be an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, whether domestic or foreign.

LLC Operating Agreement: Although not required, LLC members may adopt an operating agreement for the company, which may also be amended and repealed as allowed by the agreement or applicable law. The Articles of Organization may contain restrictions or prohibitions on the power of the members to adopt, amend, or repeal an operating agreement. If there is more than one member, any operating agreement shall initially be agreed to, in writing, by all of the members.

Membership: A limited liability company must have one or more members.

Eligibility Requirements: A natural person or an entity.

Procedure for Membership: The member may acquire an interest in the LLC directly from the limited liability company at the time of formation and, after formation, at the time provided in and upon compliance with the Articles of Organization or the operating agreement or, if not provided, only upon the vote of a majority in interest of the LLC members, excluding the vote of the person acquiring the membership interest, and only when the person becomes a party to the LLC's operating agreement.

Professional Services: California law does not allow a domestic LLC to provide "professional services." A professional service is a type of service that requires a license or certification. It is recommended that you check with an attorney or the proper licensing authority to determine whether your business falls under the "professional services" category.

Resident Agent needed for a California LLC

UpCounsel attorneys can also provide your business with a registered agent in California. Every California LLC must have a registered agent in California, which is the person or office designated to receive official state correspondence and notice if the company is "served" with a lawsuit. The registered office may be a place of its business.

California Secretary of State

Once you create an LLC in California, the California Secretary of State will require that certain recurring responsibilities and duties be fulfilled. The most important of these are explained below.

For further information, contact the California Secretary of State.

Recurring Responsibilities and Duties for California LLCs

Annual Report: Each limited liability company shall provide an annual report to the California Secretary of State regarding its financial condition to each of its members.

Records: Each California limited liability company must keep the following records open to inspection at its office:

  1. A current list of the full name and last known business or residence address of each member and of each holder of an economic interest in the limited liability company set forth in alphabetical order, together with the contribution and the share in profits and losses of each member and holder of an economic interest.
  2. If the LLC is manager-managed, you will need a current list including the full name and business or residence address of each manager.
  3. A copy of the Articles of Organization and all amendments thereto, together with any powers of attorney pursuant to which the Articles of Organization or any amendments thereto were executed.
  4. Copies of the limited liability company's federal, state, and local income tax or information returns and reports, if any, for the six most recent taxable years
  5. A copy of the LLC's Operating Agreement, if in writing, and any amendments thereto, together with any powers of attorney pursuant to which any written operating agreement or any amendments thereto were executed.
  6. Copies of the limited liability company's financial statements, if any, for the six most recent fiscal years.
  7. The books and records of internal affairs as they relate to the limited liability company for at least the current and past four fiscal years.

Filing Fees for a California LLC

Filings must be made with the California Secretary of State in which the LLC was organized, along with the appropriate state filing fee. When appropriate, one check must accompany the document, payable to the California Secretary of State, covering all charges for the Secretary of State.

Taxes for a California LLC

Having an LLC in California can offer certain tax advantages over having a corporation, including the availability of more tax deductions. Additionally, an LLC is not required to be a separate tax entity like a corporation; instead, it can be considered a "pass-through entity", so that the owners of the LLC report business losses or profits on their personal tax returns, just like in a partnership.

California state taxes are variable depending on taxable income. Note: California LLCs are subject to an annual franchise tax fee of $800 per year at minimum. The first payment must be made within 3 months of forming your LLC.

Federal Income Tax: Unless you elect to tax the limited liability company as a corporation, the IRS will treat a single-member LLC in California as a sole proprietorship for tax purposes. This means that the LLC itself does not have to pay taxes or file a tax return. Unless you elect to tax the limited Liability company as a corporation, the IRS treats multi-member LLCs as partnerships for tax purposes. This means that LLC owners will each need to pay taxes on their lawful share of the profits on their personal income tax returns, not just on the LLC itself. However, if you file IRS Form 8832, you may elect for corporate taxation if you regularly need to keep a substantial amount of your profits in the LLC.

Federal Tax Identification Number: Your LLC will need to obtain a federal tax identification number, which is also known as an Employment Identification Number (EIN). An EIN is similar to an individual's social security number. You will need an EIN for your LLC as long as there is one member, even if the LLC does not have employees. For certain tax filing requirements the attorney you choose on UpCounsel can help prepare your Federal Tax ID Application, if you have not done so already.

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Dissolution requirements for an LLC in California

In order for a limited liability company to be dissolved, any one of the following events must happen:

  1. At the time specified in the articles of organization, if any, or upon the happening of the events, if any, specified in the articles of organization or a written LLC operating agreement.
  2. By the vote of a majority in interest of the members, or a greater percentage of the voting interests of members as specified in the articles of organization or a written LLC operating agreement
  3. The entry of a judicial order
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