The California LLC $800 Franchise Tax: What You Must Know
Under California Revenue and Taxation Code Section 17941, every LLC formed, registered, or doing business in California must pay an annual minimum franchise tax of $800 to the California Franchise Tax Board (FTB).
Key InsightsHow the $800 Tax Works:
• Due Date: Due on the 15th day of the 4th month after the start of your tax year (April 15 for calendar-year entities). Form FTB 3522 (LLC Tax Voucher) is used to pay it.
• Payable Even with Zero Revenue: Even if your company made $0 in profit or lost money, you still owe the $800 fee every single year your LLC exists.
• First-Year Exemption History: California enacted a temporary first-year waiver (AB 85) for new LLCs formed between 2021 and 2023. Starting in year two and beyond, the full $800 annual fee is mandatory.
No. Unless you physically live in California or have employees and offices inside the state, forming an LLC in California introduces unnecessary expenses. Non-residents operating online businesses, agencies, or software products should choose Wyoming ($60 annual fee vs $800) or New Mexico ($0 annual fee).
Form in a Low-Cost State Instead
Choose Wyoming: zero state income tax, 100% privacy, and only $60/yr in state maintenance.
Explore Wyoming LLC ($399) →