Accounting Services

Entity Structuring and Business Formation in California

LLC, S-Corp, and C-Corp formation, EIN, registered agent, and entity tax strategy for California businesses. The right structure saves thousands before you earn your first dollar and continues paying dividends every year.

Schedule an Entity Strategy Consultation (951) 216-3121

California charges an $800 minimum franchise tax on LLCs before you earn a dollar. C-Corps face double taxation on profits and distributions. S-Corps eliminate self-employment tax on pass-through income above reasonable compensation — but the election must be filed correctly and on time. An LLC taxed as an S-Corp is often the right answer for a profitable single-owner business, but the numbers have to be modeled first. We evaluate your specific income, compensation, retirement, and growth plans before recommending any structure.

What Is Included

Entity Structuring — What We Do

Entity Type Analysis

LLC, S-Corp, C-Corp, and partnership comparison modeled for your specific income level, compensation plans, exit timeline, and California franchise tax exposure — with actual numbers, not general rules of thumb.

S-Corp Election — Form 2553

Form 2553 filed with the IRS and the California S-Corp election filed with the FTB — timed correctly to avoid a missed-election problem that requires an IRS private letter ruling to fix.

LLC Formation and EIN

California LLC Articles of Organization filing, EIN application, operating agreement review, and initial franchise tax setup — correctly established from the start.

Multi-Entity Structure Design

For investors and business owners operating through multiple LLCs or a holding company, we design the entity map with California franchise taxes, liability separation, and tax efficiency all considered simultaneously.

Entity Conversion

Converting a sole proprietorship or LLC to an S-Corp, or restructuring between entity types, with proper IRC §351 treatment, California conformity, and correct basis calculations handled from the start.

Annual Compliance Setup

Initial setup of payroll obligations, estimated tax schedule, California Statement of Information filings, and the annual compliance calendar — so nothing gets missed in year one.

Who We Serve

Is This Right for You?

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New Business OwnersLaunching a business and unsure whether to operate as a sole proprietor, LLC, S-Corp, or C-Corp — needing the actual tax and liability implications modeled before making a decision that affects every year forward

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Existing LLCs Ready for S-Corp ElectionProfitable LLCs whose owners are paying self-employment tax on all net income and want to evaluate whether an S-corp election would reduce their annual tax liability meaningfully

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Real Estate Investors Structuring HoldingsWho need a multi-entity structure for their portfolio — separate LLCs for liability isolation, a holding company for ownership, and proper California franchise tax planning across the structure

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Business Owners Planning to GrowWhose current structure — a sole proprietorship or single-member LLC — was appropriate at startup but may no longer be optimal as revenue and complexity grow

Common Questions

FAQ

An S-corp election generally makes sense when your net business income consistently exceeds what you would pay yourself as a reasonable salary. The self-employment tax savings on the excess — 15.3% on the first $168,600, 2.9% above that — often justifies the additional payroll and filing costs once net profit exceeds approximately $80,000–$100,000. We model the actual breakeven for your situation.

Yes, but California has its own S-corp tax — an additional 1.5% on S-corp net income (minimum $800) on top of the individual income tax shareholders pay on pass-through income. We account for this in the entity analysis so the comparison between LLC and S-corp is accurate for California specifically.

The IRS election on Form 2553 must be filed by March 15 of the tax year for a calendar-year entity, or within two months and fifteen days of the entity's first tax year. Late election relief is available in certain circumstances but is not guaranteed. Filing on time is significantly easier than correcting a missed election.

Choose the Right Structure From Day One

The wrong entity costs you money every year. We run the numbers before you file anything.

Schedule a Consultation (951) 216-3121