To start a business in California, choose a structure, file formation papers with the Secretary of State through bizfile Online ($70 for an LLC, $100 for a corporation), file a Statement of Information within 90 days, then register with the CDTFA, EDD and your city or county as your business requires. The cost most new owners miss is the Franchise Tax Board’s $800 annual tax, which every California LLC owes from its first year, so a new LLC should budget at least $890 for year one.
Sole proprietors can skip state formation but still need local licenses and, if they use a trade name, a fictitious business name statement from the county. Fees below are as of October 2026.
Updated October 2026.
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Best Business Formation Services in California (2026)
Comparing services for forming a business in California? Start with this ranked shortlist; details for each pick follow the table.
| Rank | Provider | Best for | Price | What’s included |
|---|---|---|---|---|
| 1 | Mainstay Filing | Forming an LLC with the agent, EIN and annual report included | $199/year + state fee at cost | LLC formation filing, registered agent for the year, EIN application, annual report preparation and filing |
| 2 | CA Registered Agent.org | California registered agent service only | $99/year | $99 per year, flat; in-state street address for the registered office; legal documents served on the company are scanned and sent to the owner online |
| 3 | California Registered Agent.ai | California registered agent service only | $99/year | in-state street address for the registered office; legal documents served on the company are scanned and sent to the owner online |
1. Mainstay Filing
Mainstay Filing is our top pick in California. It costs $199/year + state fee at cost and covers lLC formation filing, registered agent for the year, EIN application, annual report preparation and filing. The price stays the same every year, with no add-on menu.
2. CA Registered Agent.org
CA Registered Agent.org is a California registered agent service at $99/year. It provides $99 per year, flat; in-state street address for the registered office; legal documents served on the company are scanned and sent to the owner online. It’s a fit if you only need a registered agent rather than full formation help.
3. California Registered Agent.ai
California Registered Agent.ai is a California registered agent service at $99/year. It provides in-state street address for the registered office; legal documents served on the company are scanned and sent to the owner online. It’s a fit if you only need a registered agent rather than full formation help.
How much does it cost to start a business in California?
| Requirement | LLC | Corporation |
|---|---|---|
| Formation filing (Secretary of State) | Articles of Organization (LLC-1), $70 | Articles of Incorporation (ARTS-GS), $100 |
| Initial Statement of Information | $20, within 90 days | $25, within 90 days |
| Repeat Statement of Information | Every two years, $20 | Every year, $25 |
| Franchise Tax Board | $800 annual tax from year one, plus an LLC fee above $250,000 in California income | $800 minimum franchise tax, waived for the first taxable year |
| Name reservation | $10 for 60 days | $10 for 60 days |
| Where to file | bizfile Online | bizfile Online |
1. Decide how to structure your California business
Your choice affects tax, liability and paperwork more in California than in most states, because of the $800 annual tax.
- Sole proprietorship: the cheapest start, with no state entity filing and no $800 tax. You are personally liable for business debts.
- General partnership: two or more owners, also with no required state filing, and shared personal liability.
- LLC: liability protection and pass-through taxation, but the $800 annual tax applies from the first year. LLCs with California income of $250,000 or more also pay a separate LLC fee.
- Corporation: the $800 minimum franchise tax applies too, but the Franchise Tax Board says newly incorporated corporations don’t pay the minimum in their first taxable year. Corporations file a Statement of Information every year instead of every two.
If you choose an LLC, our California LLC guide walks through the Articles of Organization field by field.
2. Choose and check your business name
Run a preliminary check in the bizfile Online Business Search. The Secretary of State notes that this search is only preliminary and that names are not checked against trademarks or fictitious business names, so also search the USPTO trademark database. An LLC name must include “LLC,” “L.L.C.” or “Limited Liability Company.”
You can reserve a name for $10. A reservation lasts 60 days and can be renewed, though not for back-to-back periods; there must be at least one day between them. Our California business name search guide covers the search in more detail.
For ideas, use the Namechk business name generator, then confirm the matching domain and social handles with Namechk before you order signage or a logo.
Fictitious business names (DBAs)
California calls a DBA a fictitious business name (FBN). The statement is filed with the county where your principal place of business is located, not with the Secretary of State, and counties set their own fees. Counties also handle the newspaper publication that typically follows an FBN filing, so ask the county clerk for the steps.
3. Name an agent for service of process
California’s term for a registered agent is an agent for service of process. Every LLC and corporation must name one in its formation filing: either an individual California resident or a corporation that has filed a Section 1505 certificate with the Secretary of State to act as an agent. The Secretary of State notes that a business entity cannot act as its own agent. To change agents later, file an updated Statement of Information; between scheduled filings there is no fee.
The address is public, and the agent must accept legal papers during business hours. Mainstay Filing includes registered agent service for the first year when it forms your company, which keeps a home address off the record. Our California registered agent guide explains the requirements.
4. File your formation documents on bizfile Online
Most owners file online:
- Sign in at bizfile Online and choose Form a Business.
- Select Articles of Organization (LLC, $70) or Articles of Incorporation for a general stock corporation ($100).
- Enter the name, business and mailing addresses, management structure and agent for service of process.
- Pay by card and download the filed document once approved.
The Secretary of State’s LLC forms page now lists Articles of Organization as an online-only filing; corporations can still use the ARTS-GS paper form, and in-person drop-offs add a $15 handling fee. After filing, draft an LLC operating agreement or corporate bylaws; California does not file them, but you will need them for banking and ownership disputes. For a fuller cost breakdown, see Mainstay’s California LLC cost guide.
Don’t miss the Statement of Information
Within 90 days of formation, file your initial Statement of Information on bizfile Online: $20 for an LLC (on the LLC-12 statement) and $25 for a stock corporation (on the SI-550). LLCs then file every two years, during a six-month window that ends on the last day of their registration-anniversary month, and corporations file every year. If nothing has changed, LLCs can file the no-change version (LLC-12NC) at no fee. Missing the deadline can trigger a $250 penalty from the Franchise Tax Board.
5. Get an EIN
Apply free on the IRS website. You need it for EDD registration, bank accounts and most state tax accounts.
No federal BOI report is needed for California-formed companies. Under FinCEN’s final rule, effective August 14, 2026, companies created in the United States are exempt, per FinCEN.
6. Register with California’s tax agencies
California splits business taxes among three agencies.
- Franchise Tax Board (FTB): income and franchise taxes. A new LLC pays its first $800 annual tax by the 15th day of the 4th month after filing with the Secretary of State, using Form FTB 3522, according to the FTB. The tax is due even if the LLC does no business, until it is cancelled.
- California Department of Tax and Fee Administration (CDTFA): sales and use tax plus special taxes. Anyone selling or leasing taxable tangible goods at retail needs a seller’s permit, and the CDTFA calls its online registration a free way to apply. Some products, such as tobacco, cannabis and electronic devices, need extra accounts.
- Employment Development Department (EDD): payroll taxes, unemployment insurance and new-hire reporting. Employers register through EDD e-Services for Business.
Hiring in California
California’s statewide minimum wage is $16.90 an hour as of January 1, 2026, according to the Department of Industrial Relations. Fast food and some healthcare workers have higher minimums, and many cities set their own higher rates. Workers’ compensation insurance is required as soon as you have an employee.
7. Get local business licenses and state permits
California has no single statewide business license. Most cities require a business license or business tax certificate, and unincorporated areas are handled by the county. On top of that:
- Zoning and home-occupation permits apply in many cities if you work from home.
- State licensing boards regulate contractors, cosmetologists, real estate agents, healthcare practitioners and many more.
- Health permits from the county are needed for food businesses.
The state’s CalGold permit finder lists the permits that apply by city and business type.
8. Open a bank account, insure the business and go online
Use your filed articles, EIN and operating agreement to open a business bank account. Keep business spending there to protect your liability shield.
Beyond the workers’ compensation requirement for employers, most businesses carry general liability insurance, and service businesses often add professional liability. Then put your name on a domain and launch a simple website.
Our picks of the best website builders
9. Stay compliant after you open
- Pay the $800 annual tax (LLCs) or minimum franchise tax (corporations) to the FTB on time each year.
- LLCs estimate and pay the LLC fee by the 15th day of the 6th month if California income will exceed $250,000.
- File the Statement of Information: every two years for LLCs, every year for corporations.
- File sales and use tax returns with the CDTFA and payroll reports with EDD on their schedules.
- Renew city business licenses and any professional licenses.
FAQs
How much does it cost to start an LLC in California?
The California Secretary of State charges $70 for Articles of Organization and $20 for the initial Statement of Information. Every LLC also owes the Franchise Tax Board’s $800 annual tax from its first year, so the minimum first-year cost is about $890 before optional services, as of October 2026.
Do new California LLCs still get out of the $800 first-year tax?
No. The first-year exemption applied only to tax years beginning in 2021 through 2023. According to the Franchise Tax Board, every LLC doing business or organized in California now pays the $800 annual tax, due by the 15th day of the 4th month after it files with the Secretary of State.
When is the Statement of Information due in California?
Both LLCs and corporations file an initial Statement of Information within 90 days of forming. After that, LLCs file every two years for $20, and stock corporations file every year for $25. All filings can be made on bizfile Online, the Secretary of State’s online portal.
Where do I file a DBA in California?
A California DBA is called a fictitious business name statement, and it is filed with the county where your principal place of business is located rather than with the Secretary of State. Each county sets its own fee, and the clerk will explain the newspaper publication step that usually follows.
Do I need a seller’s permit in California?
You need one if you sell or lease tangible goods that are normally subject to sales tax at retail in California. The California Department of Tax and Fee Administration issues seller’s permits through its online registration system, which it describes as free. Some industries need additional CDTFA accounts or licenses.
What is the minimum wage in California in 2026?
The statewide minimum wage is $16.90 per hour for all employers as of January 1, 2026, according to the California Department of Industrial Relations. Fast food workers and certain healthcare workers have higher industry minimums, and many cities and counties set higher local rates.
Can I be my own agent for service of process in California?
Yes. Any California resident with a street address in the state can be the agent for service of process for their own LLC or corporation. The address becomes public, and you must be available there during normal business hours, so many owners use a registered corporate agent instead.
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