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A corporation that incorporates or qualifies to do business in California is exempt from paying the minimum franchise tax in its first taxable year. Business entities such as LLCs, LLPs, and LPs are subject to an $800 annual tax.
Short form cancellation. If you cancel your LLC within one year of organizing, you can file Short form cancellation (SOS Form LLC-4/8) with the SOS. Your LLC will not be subject to the annual $800 tax for its first tax year.
Every corporation that is incorporated, registered, or doing business in California must pay the $800 minimum franchise tax.
Every corporation that is incorporated, registered, or doing business in California must pay the $800 minimum franchise tax.
Every LLC company in California is required to pay the California Annual Franchise Tax of $800 whether their company has an income or not within a tax year. On the other hand, LLC companies that make more than $25,000 or more during the tax year will have to pay a $900 additional fee.
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All businesses registered with the state of California have to pay the California Franchise Taxes (except for tax-exempt businesses like nonprofits). This means that C corps, S corps, LLCs, LPs, LLPs, and LLLPs all are all responsible for the California Franchise Tax.
Every LLC that is doing business or organized in California must pay an annual tax of $800. This yearly tax will be due, even if you are not conducting business, until you cancel your LLC. You have until the 15th day of the 4th month from the date you file with the SOS to pay your first-year annual tax.
A corporation or other business entity always has to pay the franchise tax in its home state. It may also have pay franchise taxes in other states in which it does business or owns property. Many corporations and other business entities have to pay franchise taxes in multiple states.
Under California law, taxpayers are exempt from the minimum franchise tax if they did not conduct business in the state during the taxable year and the taxable year was 15 days or less. An entity that qualifies under the 15-day rule does not count that period as its first tax year.
Can I avoid the California Franchise Tax? Theres no way for a registered business to legitimately avoid the California Franchise Tax. Sole proprietors and general partnerships dont have to pay the California Franchise Tax, but they also dont have any personal liability protection.

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