How to become a San Francisco, CA LLC Corporation
This is unfinished but if I sit on it long enough, they’ll change the rules and it’ll be outdated. Also, feel free to comment on it so I can refine it. I wrote this in May 2007 after starting an LLC, Safe and Secure SF LLC. The company doesn’t exist any more but the instructions below are correct.
How to become a San Francisco, CA LLC Corporation
Good books on the subject:
I found several books that gloss over the hard stuff and dwell on the easy stuff. They’ll say “Then after you’ve filed with the state, you can…”And I say, “Woh! That ‘file with the state’ part is the horrid, byzantine, slow, red-tape part I need help with!” Here are two good books that cover this stuff:
- How to Form your own California LLC Before the Ink Dries
- How to Form a California Corporation or LLC From Any State by Kevin Finck.
You can probably find them at your library.
Some of the links below don’t work. They worked when I wrote this guide in May 2007. If you find working links, please leave a comment and I’ll update this page!
Here is a somewhat useful “How to” guide. (click on the right to get pages)
Verify that your business name hasn’t already been taken. There are subtleties like that “McDonalds” might not be a registered company in California but if you’re in the fast food business, it’d be bad ju-ju to try and register it. Go to the California Business Search page and the SF Ficticious Business Name Search to look for your company name. You should also Google for it and check the US Patent and Trademark Office.
Fill out an Articles of Organization Form with the state. Go to the California Secretary of State Business Portal website. Go to the forms page. Fill out the Articles of Organization (LLC-1) form. Mail it with a check for $70. The wait time was about 5 weeks for getting forms back when I did it.
Get a Federal Employer Identification Number (FEIN). Check out the IRS page to see if you need a FEIN. Then call the nice person at 800-829-4933 to actually get the number on the phone. He’ll ask simple questions like your name, SS#, address. You’ll get the number on the phone immediately. It will look something like “01-0000000″When you get your “filed” Articles of Organization form back in 5 weeks or so, there will be a file number on it. This is your Secretary of State (SOS) number. It will look something like “200700000000”
Also in the packet when you get acknowledgment back from the state, one of the forms you’ll get is a Statement of Information. It will have a stamp on it saying how you have to file and pay ($20) within 3 months. Do so. Then you’ll have to file another one every 2 years. If you want to talk to a human to verify this, call the Secretary of State at 916-657-5448 ext. 140.
Also in the packet, you’ll also get back from the state in the same envelope a “Form FTB 3522“. It will tell you how you have to pay your $800/year LLC tax to the Franchise Tax Board. You have to pay “on or before the 15th day of the 4th month after beginning of the LLC’s taxable year”.
Have a Meeting. The required purpose of the meeting is to create a document that says (paraphrased) “On this day we had a meeting of the owners/shareholders of the company. Here are the names of the owners/shareholders and their titles.”
Ok, now that you have a FEIN, meeting minutes, and Articles of Incorporation stamped with your SOS (Secretary of State) number, you can do fun things like open a bank account in your company’s name. :-)
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To open a business checking account, bring your FEIN (I didn’t get any paper, just the number the federal guy on the phone gave me), meeting minutes, Articles of Incorporation stamped with your SOS number, and all of the corporate managers (Charlotte and I) to a bank that does business banking. We chose Washington Mutual.
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If you want to market your company with a name other than your registered name (IE: Calling it “SpeedyCorp” instead of “SpeedyCorp LLC”), go to the San Francisco County Clerk’s website to file a Fictitious Business Name (FBN). Call 415-554-4950 if you need a human. (I didn’t so I don’t know the particulars)
You can now fill out the Board of Equalization forms to get a permit to sell stuff (and charge state sales tax) To confirm this, you can call the SF BoE at 415-356-6600. When it comes time, look for form BOE 400 SPA on this page.
After waiting and receiving back the California Articles of Organization info, fill out a Business Registration Certificate from the SF Office of the Treasurer and Tax Collector. Talk to a human at 415-554-4400.
(unfinished!)
Dislaimer: I am a delicate flower.
I recently came upon a very useful site that makes available every California business license application as well as every business license, permit, and tax registration application for the entire U.S. You should check it out. They also offer help in finding out which business license one needs as well as the ability to apply online. The site is http://www.businesslicenses.com.NOSPAM
Sorry Debbie, I stuck a little NOSPAM thingie in your URL. While the business you mention provides appears to provide services, they don’t give users nuffum until we cough up some money. That seems a bit shady. If someone tells me that they are a useful service, then good.
Very useful Lee. Thanks. Charles.
Glad I could help!
Hi Lee,
Does the name for the Business have to reflect the LLC name? We are taking over a bakery and are not going to change the name eg. “Polaris Bakery”. We are planning to form an LLC, so does our LLC name have to be “Polaris Bakery LLC”?
Thanks.
Cynthia, if you want people to know your company as something other than the exact name on the LLC, you have to fill out a “Fictitious Business Name” form with… err… I forget if it’s the state, city or both. I think it’s both. It may be known as a “DBA” (Doing Business As) form. I’m pretty sure it costs less than $50.
Hi Lee,
I am wondering, since it’s nearly 2009, if I should wait to apply (for a LLC) until Jan. 1. I do not intend to sell anything until March 1, 2009, but I would like to establish my business by Jan. 1, 2009. So, should I get all the forms together to submit by Dec. 16th?
Any advise as to when I should submit the forms in I want Jan. 1 to be my ‘start date’?
Thanks!
If no one is telling you “Sorry, I can’t work with you because you don’t have a business license”, then I don’t see a reason to get the license early.
It’s not like you get magical business powers when all the paperwork is done. My (failed) business certainly didn’t. :-(
I don’t know your situation exactly. If you need to be a business on January 1st exactly, or something else is going on, then I don’t know the answer.
You might want to start filling out the paperwork and sending it in just because it isn’t all that expensive except for the $800 Sellers Permit. Wait til next year on the Sellers Permit. Other than that, it’s hours of frustration and $50 here and there. (hopefully reading this post has reduced your frustration dramatically!) For example, it might give you a little more time to think of a good business name if the one you want is taken. And then you can afford to wait a few weeks while good business cards come in via mail order…
Hi Lee!
I stumbled upon your website a while ago and I have a question. In your article in the link below, if i am going to start a promotional LLC company business. Would i still need to obtain a sellers permit after I have finished all the steps except for that one? I ask is because when i went to register the company at the city hall, the lady said i was ready to do business after i got the llc done, got the tax#, and registered the company. Hope to hear from you soon!
http://lee.org/blog/2007/05/08/how-to-become-a-san-francisco-ca-llc-corporation/
Thanks!
Derek
Derek, you’ll only need a sellers permit if you are planning on selling or reselling items to customers. Another way of thinking about it is that, with a sellers permit, you don’t pay sales tax on things you buy for customers; instead, you pass the sales tax fees on to your customers.
(from Lee: this comment is spammy but possibly useful)
This article is very helpful to someone who is trying to start an LLC corporation business. However, it is not always as easy as it looks and sounds. For more help with developing your new business, contact California Business Development.
Business Development
Forming an LLC is an excellent way for business owners to shield their personal assets. LLCs are also very beneficial to real estate investors. LLCs are one of the best means for holding real estate and other appreciating assets.
On Form FTB 3522, what is DBA? Is this my name?
Do I need an FEIN or is my Social Security okay?
Jennifer, it isn’t your name, it’s the name of the business. “DBA” “Doing Business As”
If you want people to know your company as something other than the exact name on the LLC, you have to fill out a “Fictitious Business Name” form with… err… I forget if it’s the state, city or both. I think it’s both. It may be known as a “DBA” (Doing Business As) form. I’m pretty sure it costs less than $50.
Yes, you need a FEIN to be an LLC. That’s essential. The thing with an LLC is that you are creating a new “person”. And that new person’s “Social Security Number” is their FEIN.
If you were creating a sole proprietorship, then you would use your Social Security Number on those forms instead.
Dear Lee,
I formed an LLC 3 months ago. I still have not applied for FEIN . I was filling out form 3522. In DBA , I do not have any other name for my LLC. Should I just leave it blank or fill the name of my LLC again.
Also I am thinking of dissolving my LLC as it is too much of a hassle and things did not exactly work the way I wanted. Can I go ahead and dissolve right away without paying any taxes since I did not apply for FEIN?
Thanks,
Monica
Monica, sorry I can’t answer your questions. It’s been a while since I’ve done this and it wouldn’t be right for me to offer any suggestions.