California LLC $800 Franchise Tax Due Date (Full Guide)

Atty. Danya Shakfeh
Published by Atty. Danya Shakfeh | Author
Last updated: February 10, 2024
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If you plan to establish a limited liability company in California, you should conform to business state and taxation laws. California LLCs are required to pay franchise taxes to continue operating legally in the state.

As a seasoned corporate attorney who worked with numerous clients, I assisted several business owners with taxation and the filing process.

After extensive research and consulting with experts in California, our team will share our insights on the process, due date, and payment methods to help you properly file your LLC taxes in the state.

Quick Summary:

  • A California LLC has to pay an $800 franchise tax four months after being formed, and every April 15th on the succeeding years.
  • To accomplish this, you have to file form 3536 with the California Franchise Tax Board.
  • According to California's Economic and Statistical Research Bureau, there were a total of 300,381 qualified LLCs during the tax year of 2022.
  • To ensure accurate payment and compliance for your franchise tax filing, I encourage clients to seek help from tax professionals, maintain records, and stay updated on tax-related changes.

Deadline for the California Annual Franchise Tax Payments

Calendar behind a clock and a person searching what is Delaware due date for LLC taxes

California franchise tax must be filed and paid every April 15th of each year. However, for newly-registered LLCs, the members are required to pay the fee on the 4th month after the company was officially registered and launched [1].

To illustrate, the Secretary of State approved a client's LLC in May, and they had to pay the initial franchise tax on August 15 of that year.

The LLC may be exempted from paying California annual tax if the company did not conduct business during the year and their registration was approved 15 days or less of the taxable year.

However, it would be important to note that if your company makes more than $250,000, you need to pay a corresponding fee due on the 15th of the 6th month.

California Annual Franchise Tax For LLCs

A table view of a person who is about to pay his California LLC Annual Franchise tax

Every LLC company in California is required to pay the Annual Franchise Tax of $800 by filing form 3536 (Estimated Fee for LLCs). This is mandatory, whether their company has a net income or not within a tax year.

On the other hand, LLC companies that make between $250,000 to $499,999 during the tax year will have to pay a $900 additional fee [2].

Remember that as your net income increases, this fee will increase as well. You can get more information about the tax bracket from the State of California Franchise Tax Board.

There's nothing wrong with the younger generation that becoming taxpayers won't cure. - Dan Bennet, Founder of Salus Ventures

You can file your franchise tax online or by mail [3].

To file online, follow the steps:

  • Visit California Franchise Tax Board's official website and click on "Web Pay Business".
  • Select LLC as your entity type and enter your business ID.
  • Once your business identity is verified, click form 3536 then pay the corresponding fee.

To file by mail, you can download the form online and send it to the following address along with a check or money order:

Franchise Tax Board
PO Box 942857
Sacramento CA 94257-0531

The application may take up to 3 months to process. That's why I prefer filing online since it's more convenient and efficient.

For inquiries and verifications, you can contact the Franchise Tax Board by calling 1-800-852-5711 or visiting their website.

Related Articles:

Finding a California Accountant

If you're looking for an accountant to handle your minimum franchise tax, you can find the one best suited for your business with 1-800 accountant.

Hiring an accountant within 1-800 accountant helps provide transparency throughout the hiring process, allowing you to see reviews of each professional before making a final decision.

By using Thumbtack's free service to hire an accountant for legal services, you can ensure that your company gets the best service for the lowest price.

FAQs

What Happens If You Don't Pay $800 California LLC Tax?

If you don't pay $800 California LLC tax, you will be subjected to a 5% penalty each month of unpaid tax.

Do Foreign LLCs Pay California Franchise Tax?

Foreign LLCs pay California franchise tax in order to operate in the state.

Annual California Franchise Tax

The annual California Franchise Tax is set at a fixed amount of $800.

This is a mandatory tax for all entities conducting business in California, including corporations, LLCs, and limited partnerships.

The tax serves as a minimum tax requirement imposed by the state. Therefore it is not an income or profit-based tax.

Failure to pay franchise tax can result in penalties and consequences for non-compliance.

It's important to ensure timely payment to fulfill your tax obligations and maintain compliance with California tax regulations.

Consider getting a tax professional to help with the estimated tax payments.

 


References:

  1. https://www.ftb.ca.gov/forms/misc/3556.html
  2. https://www.ftb.ca.gov/file/business/types/limited-liability-company/index.html
  3. https://www.ftb.ca.gov/file/ways-to-file/

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