Forming a limited liability company in California

| Oct 30, 2020 | business law | 0 comments

Creating a separate legal entity for your business can help protect your personal assets from company debts and liabilities. A limited liability company is a popular choice for small business owners that offers simple, flexible operational requirements and tax advantages.

Review the process of forming an LLC in California.

Choose a name

Your company must have a unique name that another California business has not already registered. If you apply to start an LLC with a name that is already in use, the state may reject your application. You can search the state business registration database for your desired business name to ensure it is available.

Select a registered agent

You must choose either a California resident or professional firm to accept legal service and official documents for your LLC. If you live or have a physical business location in California, you or one of your partners can serve as the registered agent.

File required documents

The operating agreement for your LLC details the share of the company controlled by each owner, as well as his or her operational responsibilities. You should also include details about how you plan to come to a consensus on important business decisions.

Along with your operating agreement, you must file Articles of Incorporation for your proposed LLC, either at the local Secretary of State office, by mail or online. This document requires a fee of $70.

Maintain your California LLC in good standing by completely separating personal and business finances. You should also have a business license to operate legally in your city.