California LLC Taxes
California LLCs face the highest annual entity tax in the country: $800 franchise tax minimum, plus an additional LLC fee on gross receipts above $250,000.
The $800 minimum annual franchise tax
Every California LLC owes the $800 franchise tax to the Franchise Tax Board (FTB) every year, regardless of profitability or activity. Due date: the 15th day of the 4th month after the start of the taxable year (April 15 for calendar-year filers).
The income-based LLC fee
If gross receipts exceed $250,000, an additional LLC fee applies on top of the $800:
| Total 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 or more | $11,790 |
Federal taxation
By default, single-member California LLCs are disregarded entities and report on Schedule C of the owner’s personal return. Multi-member LLCs file Form 1065 (partnership). Either can elect S-Corp or C-Corp status with Form 8832 / 2553.
State income tax on members
California members pay state income tax on pass-through LLC income at ordinary rates (1% to 13.3%). Non-resident members pay California tax on income sourced to California.
Sales tax
Selling tangible goods or certain services in California requires a Seller’s Permit from the California Department of Tax and Fee Administration (CDTFA). Base state rate is 7.25% with local additions.
Frequently asked questions
Can I avoid the $800 California LLC tax?
When is the $800 California franchise tax due?
Does an LLC pay California income tax?
Sources & further reading
Disclaimer: Legal information, not legal advice. For advice about your specific situation, consult a licensed attorney or CPA in your state. See our full disclaimer.