California Business Portal

What is the limited liability company (LLC) fee?

Effective January 1, 2007, LLCs are subject to an annual fee based on their total income "from all sources derived from or attributable to this state" (California Revenue and Taxation Code (R&TC) Section 17942). Total income for LLC fee purposes is "gross income, as defined in Section 24271, plus the cost of goods sold, paid, or incurred in connection with the trade or business of the taxpayer."

LLCs determine total income from California sources by using
the rules for sales assignment under R&TC Sections 25135 and
25136 and the related regulations, as modified by regulations
under R&TC Section 25137, other than those provisions that exclude receipts from the sales factor (R&TC Section 17942(b)(1)(B)).

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