What is the California LLC franchise tax?

California imposes an $800 minimum franchise tax on every LLC registered in the state, due annually regardless of whether the business earns any revenue or profit. This tax is payable to the California Franchise Tax Board (FTB) by the 15th day of the 4th month after your LLC's tax year begins.

The $800 franchise tax applies to both California-formed LLCs and out-of-state LLCs registered to do business in California. First-year exemption: LLCs formed after January 1, 2021 are exempt from the $800 fee for their first tax year only. Beyond the minimum, LLCs with gross revenue over $250,000 pay an additional fee: $900 for $250K-$500K revenue, $2,500 for $500K-$1M, $6,000 for $1M-$5M, and $11,790 for over $5M. This is why California is the most expensive state for LLC maintenance and why many California founders consider forming in Wyoming or Nevada — though doing so triggers foreign qualification requirements if they operate in California.