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Written by : Hollis Scovell
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hi patrick russell e8 with today's caliente topic great news for small startup business owners looking to start their llcs or llps in the state of california governor gavin newsom signed into law the 2020 budget a b act 85 which within one of the provisions is now exempting first year franchise fee that 800 franchise fee for the privilege of doing business in california will now be waived for any llc's or llps that organized after january 1st 2021 and this exemption will now be carried to through to january [ __ ] let's see january 1st 2024 all right and so there's no income limit to that so depending on whether or not you have a loss or making money in that first year is inconsequential to this exemption that first franchise fee is excluded for your first year now come year two then the annual 800 minimum franchise fee will be required to be paid every year until that llc formally dissolved now remember that 800 franchise fee is a minimum fee it can go higher the rate is based off of the gross sales gross revenue that the llc reports to the state of california that 800 minimum is covered for the first 250 000 of gross revenue once you receive gross once you get past the 250 000 mark from 250 000 to 499 000 the franchise fee becomes seventeen hundred dollars that's eight hundred dollars plus an additional nine hundred dollars for a full seventeen hundred dollar annual fee and then that'll cover you until five hundred thousand and then after five hundred thousand to a million nine hundred ninety nine thousand nine hundred ninety nine the franchise fees goes up to thirty three hundred dollars a year guys this has been a real quick calliente topic a real quick way to get a quick answers by using the comment box below don't just subscribe to this channel even though i will be doing this pro bono tax workshop on a daily basis but lend your voice to the show it'll make it a whole lot more fun viagrandios compadres
Thanks for your comment Efren Kvam, have a nice day.
- Hollis Scovell, Staff Member
it's july 1st meaning that if you're a california business owner looking to start your california llc here's some good news the california secretary of state's actually waiving the 70 fee associated with the articles of organization that you have to file to form an llc that's going to be in place from now until the end of 2023 so it's 70 but hey everything counts and don't forget that any llc formed now through 2023 gets their first year franchise tax board minimum tax of 800 waived as well so if you're thinking about starting an llc now's the opportunity
Thanks potegnulas your participation is very much appreciated
- Hollis Scovell
About the author
I've studied multilinear algebra at University of Houston-Clear Lake in Houston and I am an expert in education policy. I usually feel groggy. My previous job was logging worker supervisor I held this position for 8 years, I love talking about astronomy and video games. Huge fan of Toby Keith I practice bodysurfing and collect radio premiums.
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