How Much Does It Cost to Start an LLC in California? (2026)
California’s LLC filing fee is $70. That number is almost irrelevant.
The real cost of a California LLC is the $800 annual franchise tax the Franchise Tax Board charges every single year — whether your LLC earns $1 or $1 million. Most guides bury that fact in paragraph six. It belongs in paragraph one.
Here’s a full accounting of what you’ll actually spend to form and maintain a California LLC in 2026, from day one through year two and beyond.
California LLC Cost at a Glance
[CostBreakdown]
| Cost Item | Amount | Frequency |
|---|---|---|
| Articles of Organization | $70 | One-time |
| FTB Franchise Tax | $800 | Every year |
| Statement of Information | $20 | Every 2 years |
| Registered Agent Service | $50–199 | Every year (optional) |
| LLC Formation Service | $0–39 | One-time (optional) |
| EIN | $0 | One-time |
Year 1 minimum (DIY, no extras): $890 That’s $70 to file + $800 franchise tax + $20 Statement of Information.
Realistic year 1 total: $1,000–$1,200, once you add a registered agent service and a basic formation tool.
Year 2 and beyond: $800 (FTB) + $0–199 (registered agent) + $20 every other year for the Statement of Information.
One-Time Formation Costs
Articles of Organization: $70
This is the mandatory fee to register your LLC with the California Secretary of State. You file through BizFile Online. Standard processing takes 2–3 business days. No way around this cost — it’s the price of entry.
Name Reservation: $10 (optional)
If you’re not ready to file immediately but want to lock in your LLC name, California lets you reserve it for $10. But if you’re filing within the next few days, skip it. Just search the name on BizFile to confirm it’s available, then file.
LLC Formation Service: $0–$39 (optional)
You don’t need one. You can file directly on BizFile Online yourself. But if you’d rather have someone handle the paperwork:
- Northwest Registered Agent — $39 + state fee. Includes registered agent service for the first year.
- ZenBusiness — $0 + state fee for the basic plan.
- Bizee — $0 + state fee for the starter plan.
None of these are legally necessary. They’re a time trade, not a requirement. If you’re comfortable filling out a one-page form online, do it yourself.
EIN: $0
An Employer Identification Number is your LLC’s federal tax ID. The IRS issues them free at IRS.gov. Takes about 10 minutes. If any service charges you for an EIN, that’s a red flag — walk away.
Operating Agreement: $0–$500+
California doesn’t require you to file an operating agreement, but you should have one. It’s the internal document that defines ownership percentages, how profits split, and what happens if a member leaves.
A free template from a reputable source gets most single-member and simple multi-member LLCs where they need to be. An attorney-drafted agreement makes sense if you have multiple members with unequal contributions, complex ownership structures, or outside investors. That runs $300–$500+ depending on the attorney and complexity.
Expedited Processing: $25–$100 (optional)
Standard processing through BizFile Online is 2–3 business days. If you need it faster, California offers expedited processing for $25 (same-day submission review) or $100 for next-day guaranteed processing. Most people don’t need this. Plan ahead and save the money.
Annual Ongoing Costs
This is where California gets expensive relative to other states. Formation is a one-time event. These costs repeat.
$800 Franchise Tax — Every Year, No Exceptions
The California Franchise Tax Board charges every LLC $800 per year, minimum. It doesn’t matter if your LLC made money. It doesn’t matter if it made nothing. It doesn’t matter if you’re still building your website and haven’t landed a single client. $800.
Due date: the 15th day of the 4th month after your LLC’s tax year begins. For most LLCs using a calendar tax year, that’s April 15.
The Q4 formation trap: If you form your LLC in October, November, or December, you’ll owe $800 for the current tax year — and then another $800 again in April, just a few months later. Two $800 payments within a short window. If you’re planning to start near the end of the year, either form in early Q4 and accept the double hit, or wait until January 1 so your first payment isn’t due until April of the following year.
Gross receipts fee: If your LLC earns $250,000 or more from California sources in a year, you owe an additional fee on top of the $800:
| California Gross Receipts | Additional Fee |
|---|---|
| $250,000–$499,999 | $900 |
| $500,000–$999,999 | $2,500 |
| $1,000,000–$4,999,999 | $6,000 |
| $5,000,000+ | $11,790 |
Good problem to have. But worth knowing before you get there.
$20 Statement of Information — Every 2 Years
Within 90 days of forming your LLC, you must file a Statement of Information with the California Secretary of State. $20. After that, it’s due every two years by the last day of the anniversary month of your formation.
Miss it? $250 penalty. The Secretary of State will also suspend your LLC if you stay delinquent. Set a calendar reminder now.
Registered Agent Service: $0–$199/Year
Every California LLC needs a registered agent — a person or service with a physical California address (not a PO Box) who receives legal documents and official state mail on behalf of your LLC.
You can be your own registered agent if you have a California address and you’ll reliably be there during business hours. That costs $0.
If you work from home and don’t want your home address on public state records, or if you travel frequently, a registered agent service makes more sense. Prices range from $50 to $199 per year depending on the service. Northwest Registered Agent is consistently reliable at around $125/year after the first year.
Business Licenses: Varies by City and County
California doesn’t have a statewide general business license, but most cities and counties require one. Costs vary widely:
- Some cities charge a flat annual fee of $50–$100.
- Others charge based on gross receipts — meaning the more you make, the more you pay.
- A handful of small municipalities charge nothing below a certain revenue threshold.
Check with your specific city or county. Los Angeles, San Francisco, San Diego, and Sacramento all have their own licensing requirements and fee structures. This is not optional — operating without a required local license can result in fines.
Business Insurance: $300–$2,000+/Year
Technically optional. Practically, almost always worth it.
General liability insurance for a small California LLC typically runs $300–$700/year. If you’re in a higher-risk industry — construction, food service, healthcare-adjacent — expect to pay more. Professional liability (E&O) adds another $500–$1,500/year depending on your field.
An LLC gives you personal liability protection, but it doesn’t make you immune to lawsuits. Insurance covers what the LLC structure doesn’t.
California vs. Other States — Cost Comparison
California’s filing fee is reasonable. The annual burden is not.
| State | Filing Fee | Annual Cost | Year 1 Total (minimum) |
|---|---|---|---|
| California | $70 | $800 FTB + $20 SOI (biennial) | $890 |
| Georgia | $100–$110 | $60 | $160–$170 |
| Oklahoma | $100 | $25 | $125 |
| Delaware | $90 | $300 | $390 |
| Wyoming | $100 | $60 | $160 |
Oklahoma has the cheapest ongoing cost of any state at $25/year. Georgia is straightforward and affordable. Delaware is popular for corporations and venture-backed startups, but for a small LLC operating in California, registering in Delaware means paying Delaware’s fees plus California’s $800 — because California taxes any LLC doing business in the state regardless of where it’s incorporated.
The short version: if you’re operating in California, form in California. Out-of-state formation doesn’t help you escape the franchise tax.
Hidden Costs to Watch Out For
Formation Service Auto-Renewals
Free formation services aren’t always free in year two. ZenBusiness’s Worry-Free Compliance package — which some customers get enrolled in by default — renews at $199/year. Bizee has similar upsells. Read what you’re signing up for. If you only want formation help and registered agent service, choose those items specifically and skip the compliance packages unless you genuinely need them.
Registered Agent Rate Increases
Some services offer a promotional first-year rate of $49 or $59, then renew at $150–$299. Check the renewal rate before you sign up, not after. Northwest Registered Agent is consistent year over year. Some of the cheaper services aren’t.
Business Bank Account Fees
A separate business bank account is essential for maintaining your LLC’s liability protection — mixing personal and business funds is how you accidentally “pierce the corporate veil.” Many traditional banks charge $10–$20/month for business checking. Look at Mercury, Relay, or Bluevine for fee-free business banking options. That’s $120–$240/year you don’t need to spend.
Bookkeeping and Accounting
DIY bookkeeping costs $0 if you’re disciplined and your finances are simple. Accounting software like QuickBooks or Wave runs $0–$30/month. A part-time bookkeeper runs $200–$500/month. A CPA for tax prep adds $500–$2,000/year depending on complexity.
These aren’t optional in practice — the FTB takes California business taxes seriously, and errors cost more than the accountant would have. Budget for it.
Frequently Asked Questions
[FAQAccordion]
What is the cheapest way to start an LLC in California?
File yourself through BizFile Online for $70. Get your EIN free from the IRS. Use a free operating agreement template. Be your own registered agent if you have a California address. Your absolute minimum cost to form is $70 — but your first-year minimum including the franchise tax and Statement of Information is $890.
Is the $800 franchise tax required even if my LLC makes no money?
Yes. The $800 is a minimum tax, not an income-based fee. Your LLC owes it whether it earned $500,000 or $0. The only exception: LLCs formed after January 1, 2021 are exempt from the franchise tax for their first taxable year. You still owe it starting in year two.
Is the Statement of Information required every year?
No — it’s biennial (every two years). But your first Statement of Information is due within 90 days of forming your LLC. After that, you file it every two years. The fee is $20. Missing it triggers a $250 penalty.
Do I need a lawyer to form a California LLC?
No. Filing Articles of Organization through BizFile Online is a straightforward process. You don’t need legal help for a standard single-member or simple multi-member LLC. Where an attorney adds value: complex partnership structures, outside investors, intellectual property considerations, or any situation where the ownership terms could become disputed later.
What happens if I form my LLC in Q4?
You owe the $800 franchise tax for the current tax year, then again in April of the following year. Two payments close together. If timing is flexible, forming in January sidesteps this. If you need to form in Q4, just plan for the double hit — it’s not a penalty, just an unfortunate calendar reality.
Can I avoid California’s $800 franchise tax by forming my LLC in another state?
No. If your LLC is doing business in California — meaning you have employees, customers, or operations here — California requires you to register as a foreign LLC and pay the $800 regardless of where you incorporated. Out-of-state formation adds fees without eliminating California’s.
The Bottom Line
California’s $70 filing fee is the smallest number on your cost sheet. The real number is $890 minimum in year one — and $800 every year after that, forever, until you formally dissolve the LLC.
That’s the deal California offers. For a lot of businesses, it’s still worth it — California’s market, talent pool, and customer base are unmatched. But go in knowing the actual number, not the $70 figure that looks good in a headline.
Ready to file? Start at BizFile Online. It takes about 15 minutes, and your LLC can be active within a few business days.