We started everything really quick, so we thought the Annual $800 tax was for the tax year and paid NEXT YEAR. But I guess it is within 4 months of starting. What happens when they don't get the $800 by the 4th month? Do they send notices with a late fee? Just wondering so our LLC doesn't get suspended. Thanks.
In Calfornia, a Limited Liability Company (LLC)'s first annual LLC tax payment is due on the 15th day of the 4th month after the filing date.
Each year's subsequent filing is due on the 15th day of the 4th month of the end of the tax year, or April 15th for calendar year filing.
So, for example, if you filed a new LLC on November 10th, the following year you would owe $800 on March 15th and another $800 on April 15th.
The LLC must pay the minimum franchise tax to the California Franchise Tax Board, even if it is non-operational. California has a minimum franchise tax of $800 on all LLCs that are taxed as partnerships (i.e. pass through taxation). This applies to foreign and domestic California LLCs.
Failure to timely pay may result in penalties, fees, and interest.
See:
https://www.ftb.ca.gov/forms/misc/3556.pdf
https://www.ftb.ca.gov/forms/misc/1024.pdf?WT.m...
Eventually, the FTB will suspend an LLC which fails to file one or more tax returns and/or which fails to pay the business' balance due.
I don't recall whether a late notice is sent, but you will be assessed a late fee, and your entity will be subject to suspension, and the process to revive your active status is a transactional burden.
When your payment is not received by the due date, California assesses a late fee and your tax account is suspended. Also, the secretary of state is notified and your entity becomes administratively suspended. You then have two administrative issues to rectify.
When you're suspended, you have to proactively seek reinstatement with the franchise tax board and the secretary of state. Merely paying the franchise tax will not revive your entity and restore things to their natural order. I know there is a form to complete and there is also a fee to revive as well.
It's best you bite the bullet and get it paid asap so as to avoid the administrative headache of getting things restored.
