Your Hassle-Free Path to Forming a California C Corporation

FREE business incorporation, including registered state agent
Just pay state fees, order in 5 minutes or less

Forming a California C corporation has become easier with our user-friendly online platform. We provide everything you need, from expert guidance to expedited processing, streamlining your journey towards business success.

Committed to simplicity and transparency, MaxFilings offers competitive, all-inclusive pricing that covers all California fees upfront—no hidden costs or surprises.

When you form a C corp, you do more than start a business; you create a legally distinct entity with its own rights and responsibilities separate from its owners. From your initial click to the final submission of your paperwork, we’re here to guide you every step of the way—no legalese, no hidden fees.

What is a California C corporation?

A California C corporation (or C corp) is an independent legal entity separate from its shareholders (the owners). It is incorporated under California state law and offers several distinct advantages. This C corp structure is particularly attractive for those looking to raise capital easily, as it allows for the issuance and sale of stock.

Although taxed at the corporate level, C corps can retain more profits due to generally lower corporate tax rates.

A California C corp is a popular choice for business owners aiming for growth, asset protection, and various fringe benefits. One of the main benefits of being a shareholder in a California C corp is limited liability. This provision shields your personal assets from the corporation’s debts or legal challenges.

Generally, as a shareholder, you’re only liable up to the amount you’ve invested in the corporation. If the corporation goes bankrupt, you’re not responsible for its debts.

In the event of lawsuits, only the corporation’s assets are at risk for satisfying judgments, while personal assets such as your home, car, or bank account typically remain protected.

However, liability protection isn’t absolute. Under certain conditions, shareholders may be held personally liable. For example, shareholders could face personal liability if the corporation engages in reckless conduct that causes harm or if the corporation is used as a front for fraudulent activities.

What are the tax requirements for a C corporation in California?

California C corp shareholders benefit from keeping their personal and business finances separate for tax purposes. The corporation files its tax returns and pays income taxes often at rates lower than individual tax rates.

In contrast, shareholders are only responsible for reporting and paying personal income taxes on the funds they receive from the corporation, such as salaries or dividends. It’s important to be aware that dividends paid by a C corp are subject to the principle of “double taxation.” This means that the corporation pays taxes on its income first, and then any dividends distributed to shareholders are taxed again at the individual level. While the corporation may have already paid taxes on that income, shareholders must still pay personal income taxes on the dividends received.

Ready to form a business online?

If you’re ready to form a California corporation, you can start entering your information now. You’re under no obligation, and there is no charge until you actually place your order.

Incorporate in California with MaxFilings

Why form a California C corp?

A California C corp is an excellent choice for owners looking for limited liability, a structured business framework, tax optimization, asset accumulation, and easier access to capital. It combines the advantages of asset protection with potential tax benefits and more straightforward avenues for raising funds.

Your next steps for business formation with Maxfilings

Ready to establish your California C corp? You need to file official documents with the state of California to make it official.

MaxFilings can facilitate this process for you. Lay the foundation for your business success and set up your California C corporation with us today.

Some points to consider when forming a California C corp

To officially establish a California C corp, you must file the required documents with the state and pay applicable state filing fees.
Legally, a California C corp is recognized as a distinct entity, separate from its shareholders.
A California C corporation may have an unlimited number of shareholders.
It is mandatory to keep accurate minutes of shareholders’ and board of directors’ meetings.
A California C corp may face certain restrictions on the types of business activities it is permitted to engage in.

Limited liability

Typically, shareholders of a California C corp enjoy limited liability, risking only the amount they’ve invested in the business.
Shareholders are generally not held personally responsible for legal judgments against the corporation or the corporation’s debts and obligations.
Protecting personal assets for shareholders is a leading reason many business owners choose to incorporate in California.
There are exceptions to this limited liability, where shareholders could be held personally liable.

Raising capital

A California C corp can raise additional capital more easily than other business structures due to its ability to issue and sell stock or other financial instruments.
Remember, California and federal securities laws often regulate stock sales, so compliance is key.
Ownership transfer is streamlined in a California C corp, as it can be easily accomplished by selling stock in the business.

Taxation

California C corps are audited less frequently than sole proprietorships and partnerships.
These corporations often enjoy lower tax rates, which allows owners to retain more profits.
Shareholders face double taxation on dividends from the corporation.
California C corps can help reduce self-employment taxes for owners.

Owners & employees

Owners working for a California C corp qualify for benefits like group insurance and retirement plans.
Employees often prefer corporations that offer stock options and bonuses.
A California C corp continues to exist even if a shareholder or owner passes away.

Public perception

The public often perceives corporations as more established than sole proprietorships and partnerships.

Choose MaxFilings for affordable business incorporation

Starting your California C corp doesn’t have to be expensive. With MaxFilings, you receive affordability, flexibility, guidance, and peace of mind.

Our Basic package is $0 + mandatory California state fee, ensuring transparency with no hidden charges. Plus, you can save your progress online, receive step-by-step guidance, and enjoy comprehensive services designed to make the incorporation process seamless.

Start your journey with MaxFilings today!

However, if you’re set on DIY incorporation, these are the basic steps:

Choose a unique business name: Choose a distinct corporate name that complies with California’s regulations and secure a matching domain.
Select a registered agent: Appoint someone in California to receive your corporation’s official documents.
File incorporation papers: Submit the Articles of Incorporation and required fees to the California Secretary of State.
Create bylaws: Draft bylaws to set your corporation’s internal rules.
Hold first meeting: Hold an initial board meeting to adopt bylaws and issue stock.
Get an EIN: Apply for an Employer Identification Number with the IRS.
Open a business bank account: Create a separate account just for business transactions.
File initial statement: File a Statement of Information with the California Secretary of State within 90 days of incorporation.
Get licenses: Acquire all necessary permits and licenses.
Stay legal: Regularly meet all legal and tax obligations.

Start Your C Corp for $0 + California State Fee

Incorporating a C corp in California doesn’t have to be expensive.

Our C corporation formation packages start at just $0 + California state fee.

You only pay for what’s absolutely necessary, and you get a host of benefits at no additional cost:

Preparing and filing the Articles of Organization
Unlimited name availability searches
FREE registered agent service for a year
Unlimited phone & email support

Yes, you read that correctly! All of the above for the mandatory state fee.

Ready to get started?

Form your California C corp now

FAQs

What are the tax implications of a California C corp?

C corps are taxed at the corporate level, generally at a lower rate than individual income tax. However, shareholders also face “double taxation” as they must pay taxes on dividends they receive from the corporation.

Can a California corporation have only one director?

Corporations must typically appoint at least three directors. However, there are exceptions: if the corporation has not yet issued shares or if the corporation has only one or two shareholders, then the board can consist of one or two directors.

Are there annual reporting requirements for a California C corp?

In most states, including California, business organizations are required to submit a periodic report. In California, a Statement of Information must be filed with the Secretary of State. This should be done initially within the first 90 days after incorporation and then on an annual basis thereafter.

Start a business in California

What’s the best business structure to incorporate in California? Read our guide.