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Written by : Haywood Yeboah |
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do I have to pay California's $800 franchise fee for my LLC Amanda here from the business finance coach where I'm simplifying accounting taxes and business planning if this sounds like something you're interested in you can subscribe to my youtube channel while still watching this video by clicking the watermark in the bottom right corner of your screen back to the California Franchise Tax fee of $800 so do you really have to pay this fee you can see the state web site behind me you just search ftb.ca.gov and you can just search FTB $800 LLC California and up will come the links for this site it does sound a little confusing as you'll see in this graph here where they talk about the annual California fee and then they talk about incomes greater than two hundred and fifty thousand dollars now just to verify I actually called and spoke to the state and part of why this is confusing is because there's two fees or taxes that apply to your LLC if you have an LLC in the state you have to pay the $800 franchise tax fee every year everyone really pays the $800 fee for any LLC formed in the state the second aspect is if you have an annual LLC fee which is in addition to that $800 fee which you pay every year as long as the income is less than 250,000 in your business you don't have to worry about an additional tax but once your gross income sales goes above 250,000 then you will have an additional tax to pay to the state of California the next thing I want to show you is the amount of that additional tax here we are in the instructions and this is where you'll see the amounts of the second feed two hundred fifty thousand to four hundred and ninety nine nine nine nine a dollar short of five hundred thousand pay $900 five hundred to a million right before million pay twenty five hundred dollars a million to almost five million pay six thousand dollars and then the next bracket over five million pay eleven thousand seven ninety like many things taxes you know it's like the person making 1 million is paying the same as the person making four point five million so you know is it fair I don't know but regardless this is the tax for California and then you can see that they give a an example down here and they go through for each business the annual tax which is that eight hundred dollar fee plus the LLC fee so the annual tax is eight hundred and the LLC fee is based on if you earn more than two hundred fifty thousand and your income and so I know that that's a little confusing I'd love to hear any questions you have in the comments below if you enjoyed this video let me know otherwise subscribe I'll see you next time have a beautiful day bye
Thanks for your comment Suzan Sieradski, have a nice day.
- Haywood Yeboah, Staff Member
all right so i'm going to show you how to pay your annual franchise tax for an llc so this is the website uh for california franchise tax board dot ca g o ftb gb i'm gonna go ahead and pay okay and i'm gonna make um you can make a payment um either these these are the options um i'll just do a bank account okay and this is for uh llc this is for a business now this is assuming you don't have an account so we're just gonna go here and pay the business okay entity type llc all right and i'm just going to pull one from um this is a random one random llc and uh and my name just for the heck of it put your name of course all right um this is actually not the contact and right here annual tax payment form hit continue okay and let's say this is uh march 5th 2021 and i want it i need to pay for um 2021 so we'll go first ending december okay 800 and we'll just put today's date okay continue okay there's a problem here oh sorry like that all right and so um this is where you're gonna put some banking information here okay and just take it forward all the way to the end and make sure you save the receipt if you need to pay for other years go ahead and you know do this process again for the other years now let's say you are behind several years and uh you know maybe it's franchise tax board suspended okay so if you know you owe the 800 a year um if you're not working with a cpa or tax professional you want to confirm with them first but you want to think about just if you know you owe it go ahead just pay the 800 for the years that you owe so that you're not including additional tax and penalties because those things like a snowball and they uh you know they keep a crew and occurring so you know you need to revive it and um and you know you you know you need to pay it go and just pay for those years so that your taxes and penalties are are minimized okay so um for those years same process here and um you know help you get out of suspension um a little bit faster okay i hope this has been helpful this is dan if you need more help contact your tax professional or reach out to our office to help find out you know how much exactly that you owe
Thanks BolcatoV your participation is very much appreciated
- Haywood Yeboah
About the author
I've studied sociology of marriage at University of Maryland, Baltimore County in Baltimore and I am an expert in inorganic chemistry. I usually feel blissful. My previous job was health educators I held this position for 7 years, I love talking about basketball and caber toss. Huge fan of Marcel Pagnol I practice paintball and collect artist trading cards.
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