To form a California LLC, the following steps need to be taken:
- Choose a name for your LLC that complies with California's naming requirements, which includes using the words "Limited Liability Company" or an abbreviation of that phrase, and ensuring that the name is not already in use by another business entity in the state. This can be checked by performing a name search on the California Secretary of State’s business search database.
- File Articles of Organization with the California Secretary of State's office, which require a $70 filing fee. This document will include the LLC's name, its address, and the name of its registered agent. It is important to note that the registered agent must have a physical address in California and be available during business hours to accept legal documents on behalf of the LLC.
- Obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) by completing Form SS-4. This is necessary for tax purposes and allows the LLC to open bank accounts, file tax returns, and hire employees.
- Prepare an LLC operating agreement, which sets out the terms of the LLC's operation and management structure, and outlines member rights and responsibilities. Although an LLC operating agreement is not required by California law, it is strongly recommended to prevent disputes among members.
- Publish a notice of the LLC's formation in a newspaper of general circulation in the county where the LLC's principal office is located, once a week for four consecutive weeks. This requirement is only applicable to LLCs with more than one member, and failure to comply could result in the LLC losing its right to do business in California.
In addition, there may be other state and federal requirements that apply to specific industries or types of businesses. It is recommended to seek the advice of a licensed attorney or accountant to ensure compliance. Once these steps have been completed, the LLC will be legally formed and can begin conducting business in California.
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