How to set up a one person LLC in California

This page lists the steps to form a one person LLC. Choosing between a sole owner business, an LLC and a co op is on Sole owner, LLC or worker cooperative. This is general information, not legal or tax advice.

Before you start: what do I need?

• A tax number for you. A Social Security number or an ITIN. The IRS online EIN tool accepts either for the owner. If you do not have one, start with How to get or renew an ITIN.
• A business name, with two backups. California law (Corporations Code 17701.08) says the name must contain "limited liability company", "LLC" or "L.L.C." ("Limited" can be "Ltd." and "Company" can be "Co."). It cannot use words like "bank", "trust", "incorporated", "corporation" or insurance words.
• A California address for the business. Some owners use their home. Your filings are public, so think about which address you want people to see.
• An agent for service of process. This is the person or company in California who accepts legal papers for your LLC. State law requires every LLC to name one. It can be you.
• $70 for filing, $20 for the Statement of Information, and a plan for $800 in state tax.
• A card or bank account to pay state fees online.

You do not need a lawyer to file. You may want one to review your plan, especially if your work carries real risk.

Step 1: Is my LLC name available?

Search the Secretary of State's business records on bizfile Online. If a name is too close to one already on file, the state can reject your filing.

Want to hold a name while you get ready? You can reserve it for $10.

Step 2: How do I file the Articles of Organization?

This is the filing that creates your LLC. It is Form LLC-1 and costs $70.

• Online through bizfile Online is fastest: 5 days or less. You will create an account.
• By mail or in person with the PDF form takes 10 days or more.

The form asks for the LLC name, the business address, the mailing address, your agent for service of process, and whether the LLC is run by its members or by managers. For a one person LLC, most owners pick "managed by its member."

Save the approved Articles. Write down the filing date. Your first $800 payment is counted from that date.

Step 3: Should I write an operating agreement?

Yes. An operating agreement is your LLC's rule book. It says you own 100% of the company, how money moves between you and the LLC, and what happens if you die or close the business. Banks and clients sometimes ask for it.

You do not file it with the state. Keep it with your records. The Immigrant Legal Resource Center has published a sample single member operating agreement for California LLCs. Have a business lawyer or a free legal clinic look at yours.

Step 4: How do I get an EIN?

An EIN is a free business tax number from the IRS. A one person LLC with no employees can often use the owner's number for income tax. Still, most new one person LLCs need an EIN, for example to hire, to open a business bank account, or to pay employment taxes.

• Online in minutes, during the IRS tool's hours
• By fax with Form SS-4: about 4 business days
• By mail: about 4 weeks

The EIN is always free from the IRS. Details are on Can I start a business without a Social Security number?

Step 5: When do I file the Statement of Information?

Within 90 days after you file your Articles. Use Form LLC-12. It costs $20 and is easiest online.

After that, file it every two years. Set a reminder now. If you miss it, the state charges a $250 penalty. Keep missing it, and the Secretary of State can suspend your LLC: under Corporations Code 17713.10, it sends a notice, and if you still do not file within 60 days, the LLC loses its powers and rights. Filing the statement late can lift the suspension, unless the Franchise Tax Board is also holding the LLC in suspension for tax reasons.

Step 6: What local licenses and permits do I need?

Your city decides most of this.

• City business license. In San Mateo County, each city issues its own. For unincorporated areas, the County Treasurer's Office issues them.
• Permits for your kind of work, such as food, beauty, building or child care. Use the state's CalGOLD permit tool to see which apply. The state says the tool is new and still being filled in, so confirm with your city.
• State professional license, if your work needs one. See Professional licenses without a Social Security number.

Step 7: Open a business bank account

Use the LLC's name and EIN. Bring your approved Articles, your EIN letter, your operating agreement and your ID. Keeping business money apart from your own helps protect the LLC's shield. See Open a bank account with an ITIN or consular ID.

The $800 yearly LLC tax

This is the part that surprises people most. Every LLC that is organized or doing business in California owes an $800 annual tax to the Franchise Tax Board.

• It is due every year, even if the LLC earned nothing and even if you stopped working. It stops only when you cancel the LLC with the state and file a final return.
• Your first payment is due by the 15th day of the 4th month after the date you filed with the Secretary of State. The Franchise Tax Board's own example: an LLC filed June 18 owes its first $800 by September 15.
• After the first year, the $800 is due by the 15th day of the 4th month of each tax year. For most one person LLCs on a calendar year, that is April 15.
• How to pay: online through the Franchise Tax Board, or by mail with Form FTB 3522 to Franchise Tax Board, PO Box 942857, Sacramento CA 94257-0631.
• There is no free first year now. That break covered only tax years 2021 through 2023.
• A bigger fee applies only if California income reaches $250,000 or more. It starts at $900 and is paid with Form FTB 3536.

What do I file every year?

For federal income tax, the IRS treats a one person LLC as part of its owner unless the owner chooses otherwise. You pay self employment tax on the profit, just like a sole owner. If you expect to owe $1,000 or more, the IRS generally wants payments during the year. See How to pay taxes on self employment income with an ITIN.

Do I need to report my LLC's owners to the federal government?

No, not anymore. FinCEN, part of the U.S. Treasury, ran a beneficial ownership report for new companies. Its final rule, effective August 14, 2026, says companies created in the United States are exempt and no longer need to file. If a website or a letter says you must pay to file one, treat it as a warning sign.

What mistakes should I avoid?

• Paying a service hundreds of dollars for filings that cost $70, $20 and $0
• Missing the first $800 because you did not know it was due. Mark the date the day your Articles are approved.
• Forgetting the Statement of Information every two years
• Leaving an LLC open that you no longer use. The $800 keeps coming. Cancel it properly.
• Using the business account for personal bills
• Hiring workers before you are ready. Every employer must check new employees' papers on Form I-9 and follow California pay laws. Talk with a business coach first.

Who can help?

Contact them to confirm hours, languages and openings. Being listed here is not a referral or a promise of service.

• Free business coaching: see Free small business coaching in the Bay Area.
• Low cost loans for business costs: see Where to get a low cost loan to start or grow a small business.
• Free tax help: see Where to get free tax help if you file with an ITIN.
• Franchise Tax Board: LLC questions at 800-852-5711, weekdays 8 a.m. to 5 p.m.
• California Secretary of State: 916-657-5448 for filing questions.
• Immigrants Rising: free workshops and one on one business support for California residents, whatever your status. Making Money (Immigrants Rising)

Is there a checklist I can print?

Forming an LLC is a real step toward building something that lasts. Take it one box at a time.