Selecting the California Corporation or LLC Name

When selecting a name for your California based corporation, it should be remembered that the name will be unique and will identify you as a separate entity transacting business in the state. The name of a corporation must end with “Incorporated,” “Corporation,” “Corp” or “Inc.”. When developing a name for a limited liability company it must end with “Limited Liability Company” or “LLC”.

Since the name you choose will be identifying your corporation or LLC as a unique entity, the company name will not be accepted if it is likely to mislead the public or if it too closely resembles the name of another business (corporation or LLC) formed in California.

During the naming process, do not use any type of punctuation such as dashes, periods or commas in name selection. It is advantageous to try to name your corporation or LLC so that it identifies with the goods or services you provide, but this is not required.

Selecting a Board of Directors

A corporation formed under California law can have several members as directors but is only required to have three, unless the number of shareholders is less. Since the board is responsible for managing the corporation, it is suggested that the board be comprised of individuals that are officers or shareholders who have some type of daily involvement with the corporation. California has no minimum age requirements for a director.

Time to Incorporate or Form an LLC

Please note that as a result of budget cuts by the California government, the time to process requests has increased and company filings can take anywhere from two to three months to be processed by the state. Speedy Incorporation will file your paperwork immediately to get you in the line for state approvals, but please note that we cannot control how fast the state processes them.

California Taxes

California formed corporations are expected to file the California Corporation Income Tax return, Form 100 or Form 100S annually, whether a “C” or “S” corporation. The amount of tax is dependent on a number of factors and there is a minimum amount due. California corporations are subject to California corporation franchise tax with the minimum tax being $800.00.

An LLC within California is required to file as either a corporation or a partnership dependent on the election made on the SS-4. California maintains an individual income tax so employers are expected to withhold state income tax and unemployment tax. California maintains a sales and use tax with the rates being 7.25% plus any district taxes that may apply.

Registered Agent

The registered agent must have a physical street address within California state. PO boxes are not acceptable, within California.

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