Instructions For Completing The Articles Of Organization (Form Llc-1)

Secretary of State

Business Entities

1500 11

Street, 3

Floor

(916) 657-5448

Sacramento, CA 95814

Business Programs Division

LIMITED LIABILITY COMPANIES

California Tax Information

Registration of a limited liability company (LLC) with the California Secretary of State (SOS) will obligate an

LLC that is not taxed as a corporation to pay to the Franchise Tax Board (FTB) an annual minimum tax of

$800.00 and a fee based on the annual total income of the entity. The tax and fee are required to be paid for

the taxable year of registration and each taxable year, or part thereof, until a Certificate of Cancellation is filed

with the SOS. (California Revenue and Taxation Code sections

17941 and

17942.) An LLC is not subject to

the taxes and fees imposed by Revenue and Taxation Code sections 17941 and 17942 if the LLC did no

business in California during the taxable year and the taxable year was 15 days or less. (California Revenue

and Taxation Code section 17946.)

An LLC that is taxed as a corporation generally determines its California income under the Corporation Tax

Law commencing with California Revenue and Taxation Code section 23001.

PLEASE NOTE: A domestic nonprofit LLC is a taxable entity and subject to the tax requirements stated above

unless the LLC has applied for tax-exempt status and the FTB determines the LLC qualifies for tax-exempt

status. Therefore, until such a determination is made, a nonprofit LLC must file a return and pay the

associated tax (and, if applicable, the fee) every year until the LLC is formally cancelled. If the LLC intends to

seek tax exempt status:

•

At the time of filing its Articles of Organization with the SOS, the LLC must include, in an attachment to that

document, additional statements as required by the law under which the LLC is seeking exemption.

Please refer to the FTB’s Exemption Application Booklet (FTB 3500 Booklet) for information regarding the

required statements and for suggested language.

•

After filing its Articles of Organization with the SOS, the LLC may apply for tax-exempt status by mailing an

Exemption Application (Form FTB 3500), along with an endorsed copy of the Articles of Organization and

all other required supporting documentation, to the FTB, P.O. Box 942857, Sacramento, California 94257-

4041.

•

The FTB 3500 Booklet and Form FTB 3500 can be accessed from the FTB’s website at

can be requested by calling the FTB at 1-800-338-0505. For further information regarding franchise tax

exemption, refer to the FTB’s website or call the FTB at (916) 845-4171.

For further information regarding franchise tax requirements, please contact the FTB at:

From within the United States (toll free) ....................................................................................(800) 852-5711

From outside the United States (not toll free) ............................................................................(916) 845-6500

Automated Service - From within the United States (toll free) ...................................................(800) 338-0505

Automated Service - From outside the United States (not toll free)...........................................(916) 845-6600

Professional Services Information

A domestic or foreign LLC may not render professional services. (Corp. Code § 17375.) “Professional

services” are defined in California Corporations Code sections

13401(a) and 13401.3

as:

Any type of professional services that may be lawfully rendered only pursuant to a license,

certification, or registration authorized by the Business and Professions Code, the

Chiropractic Act, the Osteopathic Act or the Yacht and Ship Brokers Act.

If your business is required to be licensed, registered or certified, it is recommended that you contact the

appropriate licensing authority before filing with the SOS’s office in order to determine whether your services

are considered professional.

LLC Info (REV 04/2007)

Instructions For Completing The Articles Of Organization (Form Llc-1) - 2010

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