California Business Portal

How does California treat limited liability companies (LLCs)?

For California income and franchise tax purposes, generally the Franchise Tax Board classifies: 
  • A single-member LLC as disregarded from its owner, and treats it as a sole proprietorship, or a branch or division of its owner.- An LLC with more than one member as a partnership.
  • An LLC that files an election to classify as an "association," for federal tax purposes, as a corporation.
  • An LLC must have the same classification for both California and federal tax purposes.

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