California Franchise Tax Board

What does it mean to be “FTB Suspended?”

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By: Doug Bend If a legal entity has been “FTB Suspended” it was suspended by the California Franchise Tax Board most likely because the company did not pay its annual franchise tax. There are two potential problems with being FTB Suspended: (i) Someone could register a new entity name as the same name as your entity and… … Read More

By: Doug Bend

If a legal entity has been “FTB Suspended” it was suspended by the California Franchise Tax Board most likely because the company did not pay its annual franchise tax.

There are two potential problems with being FTB Suspended:

(i) Someone could register a new entity name as the same name as your entity and… 

(ii) you might not be provided with any liability protection if a cause of action arises while your entity is suspended.

The best way to lift the suspension is to file a Statement of Information with the California Secretary of State’s Office and to work with a CPA to get your corporation squared away with the California Franchise Tax Board.

You can read more about what it means to be FTB Suspended and how to revive a suspended legal entity here.

Please do not hesitate to contact us if you’d like a recommendation for a CPA or if you have any questions.

Disclaimer: This article discusses general legal issues and developments. Such materials are for informational purposes only and may not reflect the most current law in your jurisdiction. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction. Bend Law Group, PC expressly disclaims all liability in respect of any actions taken or not taken based on any contents of this article.

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California Franchise Taxes

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The amount of franchise taxes you have to pay plays a huge role in the decision of whether or not to start, or register an existing business, in California. If you own a limited liability company (LLC), corporation, or other legal entity in California, you will be subject to the minimum annual franchise tax of… Read More

The amount of franchise taxes you have to pay plays a huge role in the decision of whether or not to start, or register an existing business, in California. If you own a limited liability company (LLC), corporation, or other legal entity in California, you will be subject to the minimum annual franchise tax of $800 per year.

If you are still weighing this decision, here are a few things to consider.

15 Day Exception

You are not subject to the annual franchise tax for a specific year if both of the following apply: (1) you did not conduct any business in CA during the tax year, and (2) your tax year was 15 days or less.

Thus, if you accidentally started a company and want to immediately cancel it, you can avoid the franchise taxes (assuming you do so speedily).

First Year Exemption for Corporations

If your corporation incorporates or qualifies to do business in CA, you are not subject to the minimum franchise tax during your first year of operations. However, you are still liable for any franchise tax on your net income. This exception will also apply to an LLC treated as a corporation. Standard LLCs must pay the minimum franchise fee of $800 during their first year of operations.

Income Earned in CA and Other States

California applies the unitary method to determine your tax liability. Under this method, all of the elements comprising your trade or business are viewed as one unitary business, whether or not the activities of your business are conducted in separate corporate forms. The business income of your unitary business is then divided and assigned to CA by means of an apportionment formula.

Converting to a New Type of Business Entity

If your business entity converts to an LLC during the current year, it generally will have tax liability and filing requirements as both the previous business entity and the new entity.

Due Dates for First California Annual Franchise Tax Payment

For LLCs, you have until the 15th day of the fourth month after you file your Articles of Organization with the Secretary of State to pay the California annual franchise tax. Recall that corporations don’t owe the franchise tax the first year. In the years ahead, and for corporation’s second calendar year conducting business in California, you have until April 15th to pay your annual franchise taxes.

This article discusses general issues surrounding a legal entities franchise taxes within California. You are encouraged to speak with a business attorney or CPA to discuss your specific situation. For all inquiries please contact us at info@bendlawoffice.com, or (415) 633-6841.

Disclaimer: This article discusses general legal issues and developments. Such materials are for informational purposes only and may not reflect the most current law in your jurisdiction. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction.  Bend Law Group, PC expressly disclaims all liability in respect of any actions taken or not taken based on any contents of this article.

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How To Change Your San Francisco Business Address

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If you change your business address in San Francisco, it is important to avoid potential issues. The following checklist is a good starting point for most businesses to make sure you update all of the necessary government agencies and service providers. 1.  California Secretary Of State’s Office You will need to file an updated Statement… Read More

If you change your business address in San Francisco, it is important to avoid potential issues. The following checklist is a good starting point for most businesses to make sure you update all of the necessary government agencies and service providers.

1.  California Secretary Of State’s Office

You will need to file an updated Statement Of Information with the California Secretary Of State’s Office. The filing fee for an LLC is $20 and for a corporation is $25. You can access the forms for online filing here.

2.  IRS Address Change

You will also need to update the IRS by filling out and mailing Form 8822-B or by calling the IRS business hotline at 1-800-829-4933. There is no filing fee.

3. California Franchise Tax Board

You will need to update the California Franchise Tax Board of your company’s new address, which you can do here. There is no filing fee.

4. San Francisco Business Registration Certificate

In addition, you need to update your business account with the city of San Francisco by clicking here. There is no filing fee.

5. Fictitious Business Name Statement

You are required to file a fictitious business name statement if you conduct business in San Francisco under a name other than your full legal name, the legal name of a legal entity, or any name that suggests additional owners. When you change your business address, you are required to file for an updated Fictitious Business Name Statement. The cost of publication varies depending on the newspaper, but the least expensive option we have found is The San Francisco Daily Journal. You can reach The San Francisco Daily Journal by e-mailing Tonya at tonya_peacock@dailyjournal.com.

6. California Department Of Tax And Fee Administration

If your business has a seller’s permit, you will need to update the California Department of Tax and Fee Administration of your company’s new address by filing Form CDTFA-345. If you do not have a seller’s permit, you can read about why you might need one here.

7. Employment Development Department

You will also need to update the Employment Development Department by logging into your account online or asking your payroll service provider to do so. There is no filing fee.

8. Business Service Providers

You should update all of the service providers for your business, such as your bank, insurance carrier, credit card companies, payment processing and other service providers.

9. Business Listings

You should update all of the online business listings for your business, such as Yelp, Facebook business page, and any other applicable listings. Once you think you have covered them all, Google the name of your business to make sure you have not missed any.

10. Registered Agent for Service of Process

If you hired a third party to be your registered agent for service of process, you should update them of your new business address.

11. Subscriptions

Does your business subscribe to any professional journals, magazines, or other subscription services? If so, be sure to update those as well.

12. U.S. Postal Service

Last but not least, you should file a change of address form with the United States’ Postal Service, which you can find here.

For many companies these are the steps necessary to change your business address in San Francisco, but please contact us at (415) 633-6841 or info@bendlawoffice.com to make sure no additional steps are required as each situation is unique.

Disclaimer: This article discusses general legal issues and developments. Such materials are for informational purposes only and may not reflect the most current law in your jurisdiction. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction.  Bend Law Group, PC expressly disclaims all liability in respect of any actions taken or not taken based on any contents of this article.

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