Choosing the right legal structure is one of the most important decisions for any entrepreneur or small business owner in Los Angeles. The right entity streamlines operations, reduces tax liability, and sets your local business up for compliance with California and LA-specific regulations. This guide walks you through entity options, registration steps, and crucial local tips for LA startups.
1. Common California Business Entity Types
- Sole Proprietorship
Easiest structure—perfect for freelancers or small businesses just starting out. Operate under your own name or a DBA (“doing business as”).
LA Note: You’ll need a Business Tax Registration Certificate (BTRC) from the Los Angeles Office of Finance. - Partnership
Two or more owners share profits, losses, and liability. Can be general or limited partnership.
LA Note: All LA partnerships must register and pay local business taxes and, if applicable, secure local permits. - Limited Liability Company (LLC)
Offers liability protection with straightforward management and flexible taxation.
California LLCs pay an annual franchise tax ($800 minimum).
LA Tip: Register your LLC with the Secretary of State, then obtain the BTRC and any industry-specific licenses. - Corporation (S Corp or C Corp)
S Corps offer pass-through taxation and reduced self-employment taxes; C Corps are suitable for larger ventures or those planning to raise capital.
Requires bylaws, annual reporting, and minutes.
LA Note: Corporations must register at local, state, and federal levels. Report officer changes and maintain compliance with CA State law. - Nonprofit Organization
Perfect for missions serving the LA community. Must register with California’s Attorney General and obtain 501(c)(3) status for federal tax exemption.
LA Tip: Apply for local fee waivers and special nonprofit licenses as applicable.
2. Step-by-Step Entity Formation in Los Angeles
- Choose Your Entity Type: Analyze liability protection, tax implications, and management needs.
- Check Name Availability: Verify your business name is unique with both California Secretary of State and LA county databases.
- File Official Documents: Articles of Organization (LLC), Articles of Incorporation (Corporation), or Partnership Agreement.
- Obtain an EIN: Get your Employer Identification Number from the IRS.
- Register Locally: Apply for your LA Business Tax Registration Certificate.
- Secure Required Permits/Licenses: Depending on your business, you may need food, retail, professional, or industry-specific permits in Los Angeles.
- Set Up Accounting/Bookkeeping: Use accounting software for compliance tracking and tax filings (QuickBooks, Xero, or LA-specific services).
- Annual Compliance Checklist: File the Statement of Information, pay franchise taxes, renew city licenses, and keep records up-to-date.
3. Important LA-Specific Notes
- Zoning & Use Permits: LA requires proof that your business location is correctly zoned. Always check with LA Department of City Planning.
- DBA (“Fictitious Business Name”) Filings: If you operate under a name other than your own/legal entity, register your DBA at LA County Clerk’s office.
- Minority & Women-Owned Certification: LA offers incentives and additional support for qualifying businesses.
4. Professional Help for Entity Setup
- Local Accountants & CPAs familiar with LA and California regulations can help avoid mistakes.
- LA Legal Advisors can draft operating agreements and ensure compliance with labor laws and city codes.
- Business Startup Centers like SCORE LA and LA Small Business Development Center offer free and paid guidance.
Conclusion: Set Your LA Business Up for Success
The right entity choice and local compliance lay the groundwork for stability, growth, and protection. Whether launching a tech startup, nonprofit, or food venture, Los Angeles offers resources and a supportive ecosystem for new businesses—if you start with a solid foundation.
Essential Agencies, Contact Info, Costs & Timelines
1. California Secretary of State — Business Entities
- Purpose: File LLC, Corporation, Partnership formation documents.
- Address: 1500 11th Street, Sacramento, CA 95814
- Website: sos.ca.gov/business-programs/business-entities
- Phone: (916) 653-6814
- Pricing:
- LLC Filing (Form LLC-1): $70
- Corporation Filing (Articles of Incorporation): $100
- Statement of Information (annual): $20
- Annual LLC Franchise Tax: $800 (pay separately to CA Franchise Tax Board)
- Timeline:
- Online: 3–5 business days
- Mail/In-person: 2–3 weeks (pay online for fastest results)
- Best Advice: File online using BizFile Online for fastest service. Filing at year-end can delay the $800 franchise tax to the next year.
2. IRS — Employer Identification Number (EIN)
- Purpose: Obtain EIN for tax reporting and business banking.
- Website: irs.gov/businesses/small-businesses-self-employed/get-an-employer-identification-number
- Phone (Int’l): (267) 941-1099
- Pricing: Free
- Timeline:
- Online: Immediate
- Mail: 4–6 weeks
- Fax: 1 week
- Best Advice: Apply online for instant approval and printable EIN letter.
3. Los Angeles Office of Finance — Business Tax Registration Certificate (BTRC)
- Purpose: Register your business locally and pay LA annual city taxes.
- Address: 200 N Spring St, Room 101, Los Angeles, CA 90012
- Website: finance.lacity.gov
- Phone: 1-844-663-4411
- Pricing:
- No upfront fee for most businesses; pay based on gross receipts at year-end. Industry and business activity may affect rates.
- Timeline:
- Online registration: Immediate temporary certificate; permanent arrives in ~1 month
- Best Advice: Register online at BTRC Portal for fastest service if only one location/opening your first LA business.
4. LA County Clerk — Fictitious Business Name (DBA)
- Purpose: File and publish any assumed business names (“doing business as”).
- Address: 12400 Imperial Highway, Norwalk, CA 90650
- Website: lavote.gov/home/county-clerk/fictitious-business-names
- Phone: (800) 201-8999
- Pricing:
- Filing: $26 (add $5 per additional name/registrant)
- 4-week Publication: ~$80–$200 (shop for cheapest local paper)
- Timeline:
- Filing: Same day (in person)
- Public notice: Must be published 4 consecutive weeks; total 4–6 weeks
- Best Advice: File and publish together with reputable local newspaper for faster proof and savings.
5. LA Department of City Planning — Zoning, Use, and Permits
- Purpose: Secure required building, zoning, or use permits for your location.
- Address: 201 N Figueroa St, 4th Floor, Los Angeles, CA 90012
- Website: planning.lacity.gov
- Phone: (213) 978-1271
- Pricing:
- Simple zoning clearance: ~$100+
- Use permits/appeals: $16,586+ depending on case (2025 rates)
- Timeline:
- Simple permits: A few days; discretionary/complex: months
- Best Advice: Check zoning status online before leasing/renting to avoid costly delays; hire local permit consultant if opening food service or high-compliance businesses.
6. Small Business Development Center – LA Region
- Purpose: Free/low-cost business advice, help with permits, formation, and bookkeeping.
- Address: 4900 E Conant St, Bldg. 02, Long Beach, CA 90808
- Website: smallbizla.org
- Phone: 1-866-588-SBDC
- Best Advice: Book a free advising appointment before beginning paperwork for affordable, hands-on help.
Price & Timeline Summary Table
| Step | Cost | Typical Timeline | Time/Cost Saving Tips |
|---|---|---|---|
| CA SOS LLC Formation | $70 + $800/year | Online: 3–5 days; mail: 2-3 weeks | File online; start late in year to delay franchise tax |
| EIN (IRS) | Free | Online: immediate | Use IRS site weekdays: irs.gov |
| LA City BTRC | $0–min. $50+ | Online: immediate temp; mail: 1 month | Use online portal, check location first |
| DBA Filing | $26 | In-person: same day | File & publish with cheapest authorized paper |
| Zoning/Use Permits | $100–$16k+ | Few days to months | Check zoning before signing lease |
| SBDC or free advisor | Usually free | Appointment: 1–7 days | Use free resources before paying pros |
Best Advice to Speed Up & Save
- Use all available online portals—Secretary of State, IRS, LA Office of Finance—for next-business-day turnaround.
- Prepare all required information in advance (business name, address, owner identity, SSN/EIN).
- Book a free Small Business Development Center or SCORE LA advising session to pre-review forms.
- File DBA and publish with a newspaper that offers bundled pricing for maximum convenience.
- For LLCs, file Articles of Organization close to year-end if you want to delay paying the $800 annual tax.
- Check zoning/permit status at planning.lacity.gov before signing a lease to avoid costly mistakes—get written clearance if possible.