"Gil Faver" <rowdy'sboss[at]xxyz.com> wrote:
- quote -

If a company has officers or employees in California, it's
probably transacting business in the state.

As far as investors, I was incorrect. California
Corporations Code § 17453 says that, if 25% of the voting
interest in a foreign LLC are located in California, they
have rights of investors in California LLC's. But it
doesn't necessarily mean it's transacting business in the
state.

Stu

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

Gil Faver wrote:
- quote -

Stu said that because any LLC that is doing business in
California, no matter where it is organized, is required to
register with the California Secretary of State and is
subject to the $800 minimum tax and the LLC fee.

An LLC with most of its members in California is probably
doing business and required to register. See the SBE
decision I cited above. Unless you can show that everything
the LLC does is done outside California, it will be subject
to registration and tax. An LLC that has employees in
California is almost certainly doing business and subject to
registration. This is true even if the employees'
activities are limited to solicitation of orders for
tangible personal property. Public Law 86-272 could protect
a nonresident member from the California income tax in that
situation, but would not protect the LLC from the minimum
tax or the fee.

Katie in San Diego

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

"Stuart A. Bronstein" <spamtrap[at]sbcglobal.net> wrote:
- quote -

why do you say this?

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

"john smith" <Nospam[at]NS.com> wrote:

- quote -

If the LLC has most of its investors, officers or employees
in California, yes you should register.

Not only is there a minimum franchise tax, but there may
also be a fee for registering a foreign LLC. The last time
I did one for a corporation (several years ago) the fee for
that was $500.

Why set up a Nevada LLC or corporation if you are based in
CA? There is no benefit whatsoever. There is additionally
more bureaucracy and cost. If the person who sold you the
LLC told you different, he lied.

Stu

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

john smith wrote:

- quote -

No, not unless or until the LLC engages in some business
activity. When that occurs, you will be required to qualify
the LLC to do business in California and pay the $800
minimum tax, plus the LLC fee (unless the latter is struck
down by the courts, which seems likely).

You can avoid registering the LLC in California after it
begins doing business if EVERYTHING IT DOES is done outside
California. That means EVERY action YOU take for or on
behalf of the LLC, you take while physically located OUTSIDE
CALIFORNIA. And you must religiously DOCUMENT that you did
so. Otherwise, the fact that you are the sole and managing
member of this LLC, and are a California resident presumably
performing at least some of your activities on its behalf in
California, will make the LLC subject to registration and
the minimum tax and fee.

See the unpublished decision of the California State Board
of Equalization in the Appeal of International Health
Institute, LLC, No. 305199, March 7, 2006 for an example of
taxability of an LLC based on the residence of the members
and the fact that they could not prove that they did not act
on behalf of the LLC in California. The decision is not on
the SBE's web site but is available through CCH, RIA, or
Lexis.

Katie in San Diego

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

I know this question has been posed before for various
circumstances. I am a California resident, I am employed in
CA and receive a w-2. I started a sole partnership (me) LLC
in Nevada in 2005. I did no business of any kind, did
nothing with my LLC, had no LLC income. Am I still required
to register the LLC in CA and pay the damn franchise tax?
Please tell me it ain't so.

Thanks, please reply to newsgroup.

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >