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Start Your California Corporation in Six Steps

Setting up a CA corporation doesn’t have to be complicated. We’ve created this straightforward guide on how to form a corporation in California.

Starting your California S Corporation or C Corporation with Incfile is fast and easy. We’ll gather all the information we need from you and file it with the CA Secretary of State. Here are the six steps you need to follow to form a corporation in California.

The Benefits of Forming a Corporation in California

Briefly, the benefits of forming a California corporation are:

  • A California S Corporation or C Corporation will protect your personal finances and assets by limiting your liability.
  • S Corporations can provide tax advantages for California business owners by reducing the self-employment tax you pay.
  • If you want limited options to buy, sell or transfer stock, a California S Corporation gives you some options.
  • CA C Corporations give you the most flexibility for creating, transferring and selling stock.

If you don’t need the options for buying and selling stock, a California LLC may be a better choice for your business. You can even have your LLC treated as an S Corporation for tax purposes to save you money.

The Six Steps to Setting up Your California Corporation

1. Search for and Choose the Right Name for Your CA Corporation

Every CA business needs a unique name, including your corporation. You can carry out a California business entity name search on the CA Secretary of State website. The name of your California S Corporation or C Corporation cannot be confusable with another business that’s been formed in California. If you’re not forming your CA corporation right away, you can reserve the name with the Secretary of State.

See if the name is available by searching for it on the California Secretary of State website.

Learn how to name your California corporation.

2. Provide an Official Address for Your CA Corporation

Every California S Corporation or C Corporation must have a designated street address. That could be your home address (if you’re running the company from your residence), your company’s office building or any physical address of your preference. The address can be outside CA, but it cannot be a P.O. Box.

3. Assign an Agent for Service of Process to Your California Corporation

When your CA corporation is formed, it must have a “Registered Agent,” known in California as an “Agent for Service of Process.” This is an official position; the Registered Agent is someone who receives official legal and tax correspondence and has responsibility for filing reports with the California Secretary of State.

A Registered Agent position for a California S Corporation or C Corporation can be filled in several ways. This position can be carried out by you, another accountable person in the business or a dedicated Registered Agent service. Your CA Registered Agent must have a physical street address in California and must be present to receive important documents for your company during business hours.

At Incfile, all of our packages include a California Registered Agent service that is free for the first year and just $119 per year afterward. We also have a dashboard where you can log in and easily view any document your Registered Agent has received on your behalf.

Here at Incfile we always recommend using a proper California Registered Agent service since they provide several benefits:

  • Some people establish companies outside of the state they live in and will use a Registered Agent service to provide an address for receiving legal documentation in the state.
  • The Registered Agent address is listed in public records on the CA Secretary of State website. If you do not want your own name and California address to be registered, you should use a Registered Agent service.
  • The Registered Agent must be present or available during normal business hours (9 a.m. to 5 p.m. Monday to Friday) to receive any legal correspondence, since the type of documents delivered to the Registered Agent require a signature on delivery.
4. Create Your California Articles of Incorporation

Once you've gathered all the information for your California corporation, you’ll need to file a formal document with the CA Secretary of State. This document is known as your “Articles of Incorporation,” and filing the document creates your CA corporation. Here’s what the Articles of Incorporation normally includes:

  • The corporation’s name
  • The corporation's Registered Agent and their address
  • The names and addresses of directors
  • The corporation’s purpose
  • The corporation’s capital structure (number of shares to be issued, who owns them, pricing, etc.)
  • The name and address of the organizer
5. Send Your California Articles of Incorporation to the Secretary of State

Once your Articles of Incorporation document is drafted, you can file it with the California Secretary of State. Filing your Articles of Incorporation creates your California corporation. You can do this online, mail in a form or have Incfile do it on your behalf.

6. Your CA Corporation Will Need to Meet Certain Legal and Compliance Requirements

Once your California corporation has been created, you will need to get certain legal requirements in place. These include:

  • File IRS Small Business Tax Election Form 2553 if you want your CA business to be treated as an S Corporation. Any California S Corporations formed through Incfile will also include a prepared Form 2553 that will be delivered with the state formation documents.
  • Create and issue stock certificates to your shareholders.
  • Apply for business licenses and permits. You may require licenses from the state of California, your county, township and various industry or federal bodies.
  • Get an Employer Identification Number (EIN).
  • File for taxes with California Department of Revenue
  • Get all formalities in place for employees, including unemployment, disability, payroll, insurance and taxes.
  • Appoint a Board of Directors for the corporation.
  • Appoint officers to the corporation.
  • Get a corporate records book to capture all your important corporate information.

Useful Corporation Information from the State of California

Other Types of CA Corporations

A regular California S Corporation or C Corporation is suitable for almost all business needs, but you also have a few other options to incorporate a special type of corporation.

Form a Professional California S Corporation or C Corporation

Some states, including California, allow certain occupations to form “Professional Corporations.” These types of corporations may need special requirements and licensing. The California Secretary of State allows for the formation of professional corporations but does not provide a defined list of professions. Instead, they state the following:“Before submitting the completed form, contact the California state board or agency that controls your profession to find out if your profession is authorized to be a corporation in California and if there are any specific corporate name style rules.”

File as a Foreign Corporation to Operate in Another State

A “foreign” filing is when you have a regular, domestic corporation in a state (typically the one where you first formed your business) and need the company to be able to operate in another state. This is where you would file a “Foreign Qualification” to the new state for your domestic corporation to be able to operate in both states. You must have an existing domestic corporation before you can file as a foreign corporation.

Need to Form a California Corporation Quickly and Easily?

Incfile provides a cost-effective service to help you create your corporation. We guide you through the process and handle most of the administrative steps on your behalf, such as filing your Articles of Incorporation. Our packages also provide a free Registered Agent service for the first year. If you're looking for assistance forming a corporation, we can help you start a CA S Corporation or C Corporation.

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Fees and Requirements in California

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Compliance Requirements

This report is mandatory and must be filed within the specified time frame in order for the entity to remain in good standing with the state. Failure to file this report can lead to the company being revoked or administratively dissolved.

Other State Requirements

Learn more about starting a business in California

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