![]() ![]() Other state filings may be required depending on the type of business. No formation documents are filed with the California Secretary of State’s office. If a sole proprietorship is formed with a name other than the individual’s name (example: John Smiths Fishing Shop), a Fictitious Business Name Statement must be filed with the county where the principal place of business is located. A sole proprietor has total control, receives all profits from and is responsible for taxes and liabilities of the business. To register an LLP in California, an Application to Register a Limited Liability Partnership (Form LLP–1) must be filed with the California Secretary of State’s office.Ī sole proprietorship is set up to allow an individual to own and operate a business. An LLP is required to maintain certain levels of insurance as required by law. Note: Registering a GP at the state level is optional.Īn LLP is a partnership that engages in the practice of public accountancy, the practice of law, the practice of architecture, the practice of engineering or the practice of land surveying, or provides services or facilities to a California registered LLP that practices public accountancy or law, or to a foreign LLP. To register a GP at the state level, a Statement of Partnership Authority (Form GP–1) must be filed with the California Secretary of State’s office. Profits are taxed as personal income for the partners. Except as otherwise provided by law, all partners are liable jointly and severally for all obligations of the partnership unless agreed by the claimant. To form an LP in California, go to .gov, log in, select Register a Business under the Business Entities Tile, Certificate of Limited Partnership - CA LP and follow the prompts to complete and submit.Ī California GP must have two or more persons engaged in a business for profit. General partners of an LP have unlimited personal liability for the LP’s debts and obligation. There must be at least one general partner that acts as the controlling partner and one limited partner whose liability is normally limited to the amount of control or participation of the limited partner. To form an LLC in California, go to .gov, log in, select Register a Business under the Business Entities Tile, Articles of Organization - CA LLC and follow the prompts to complete and submit.Ī California LP may provide limited liability for some partners. The LLC does not file the operating agreement with the Secretary of State but maintains it at the office where the LLC’s records are kept. ![]() In addition to filing the applicable documents with the Secretary of State, an operating agreement among the members as to the affairs of the LLC and the conduct of its business is required. Domestic LLCs may be managed by one or more managers or one or more members. You may use the form or prepare your own statutorily compliant document.Ī California LLC generally offers liability protection similar to that of a corporation but is taxed differently. Forms for the most common types of Articles of Incorporation are available on our Forms, Samples and Fees webpage. To form a corporation in California, Articles of Incorporation must be filed with the California Secretary of State’s office. Legal Counsel should be consulted regarding the variety of options available. The sale of stocks or bonds can generate additional capital and the longevity of the corporation can continue past the death of the owners. While normally limiting the owners from personal liability, taxes are levied on the corporation as well as on the shareholders. The information is intended to provide a basic understanding of the different business structures and is not intended to provide legal advice.īefore you establish a business in the State of California, you should consult with a private attorney or tax advisor for advice about what type of business entity will meet your business needs, and what your legal obligations will be.Ī California corporation generally is a legal entity which exists separately from its owners. The following is a brief overview of various business structures. ![]() Personal and personnel needs and the needs of your particular type of business should also be considered. ![]() Tax and liability issues, director and ownership concerns, as well as state and federal obligations pertaining to the type of entity should be considered when making your determination. Once you decide to establish a business, a primary consideration is the type of business entity to form. ![]()
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