LLC Annual Tax in California: What You Need to Know
Starting your own business is exciting—but it also comes with responsibilities you’ll want to plan for. One of the most important things to know if you have (or are thinking about forming) a Limited Liability Company (LLC) in California is the annual tax requirement of $800.
At SimpleCorp, we believe in making business formation and compliance as stress-free as possible. Here’s a clear breakdown of what this tax means, why it exists, and how you can stay compliant.
What Is the California LLC Annual Tax?
Every LLC that is organized, registered, or doing business in California must pay an annual $800 tax to the California Franchise Tax Board (FTB).
This applies whether your LLC is actively generating revenue, operating at a loss, or even if it had no income at all during the year. As long as your LLC exists in California, this fee is due.
When Do You Have to Pay?
Due Date: The $800 annual tax is due by the 15th day of the 4th month after your LLC is formed or registered in California.
For most LLCs, this is April 15th each year.
Exceptions: First-Year Tax Break
If you started your LLC in California between 2021 and 2023 (For tax years beginning on or after January 1, 2021 and before January 1, 2024), you didn’t have to pay the $800 annual tax in your very first year. (This tax break ended starting in 2024.)
Canceling in the First Year
If you decide to close your LLC within the first year, you can file a Short Form Cancellation (Form LLC-4/8) with the Secretary of State. When you do, your LLC won’t owe the $800 annual tax for that first year.
👉 At SimpleCorp, we make this process stress-free. We’ll prepare and file the Short Form Cancellation for you, ensuring your LLC is properly closed and you avoid unnecessary fees.
How Do You Pay?
The payment is made directly to the Franchise Tax Board (FTB), typically by mailing Form 3522 (LLC Tax Voucher) or paying online through the FTB’s website.
What About the “LLC Fee”?
In addition to the $800 annual tax, some LLCs also owe an annual LLC fee based on their total income from California sources.
This fee ranges from $900 to $11,790 depending on your revenue.
Not every LLC owes this—only those with income above $250,000.
| If the Total California Income is: | The Fee is: |
|---|---|
| $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 |
Why Does This Matter?
Failure to pay the $800 tax can lead to penalties, interest, and even suspension of your LLC by the Secretary of State and Franchise Tax Board. That means:
You can’t legally do business in California.
You lose the liability protection your LLC provides.
You’ll face extra costs to reinstate your LLC.
The Bottom Line
If you’re doing business in California—or even just formed your LLC here—you’ll need to plan for the $800 annual tax. Think of it as part of the cost of maintaining your LLC and protecting your business.
At SimpleCorp, our mission is to make sure you’re never caught off guard by compliance deadlines. From formation to annual filings, we’ve got you covered with expert guidance and personal support the big-box services can’t match.
👉 Need help forming or maintaining your LLC?
Talk to the SimpleCorp team today—we’ll take care of the details so you can focus on growing your business.