Starting your own limited liability company in California can be a tricky endeavor due to the sheer amount of rules and requirements that you have to remember and follow at all times. However, legally, every LLC starts with the Articles of Organization.
Today, we are going to discuss the importance of this document and give you some useful tips on how to properly create and file the articles of organization for your California-based business. But first, let's get to the basic terminology.
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The Articles of Organization, also known in some states as Articles of Formation, Certificate of Formation, or Certificate of Organization, are an official document that contains essential information about an LLC. This typically includes the name of the company, a business address, a registered agent address, a list of the company's members, and the organizer's signature (not to be confused with the owner).
Note: when starting a corporation, you need to create a similar document known as the Articles of Incorporation.
After filling out the form, the Articles then must be sent to the California Secretary of State for approval. If everything is correct and legal, the Secretary accepts your submission and officially registers your business, allowing you to operate in the Golden State.
The process of creating and filing the articles of organization boils down to three simple steps:
Generally, this is a straightforward procedure, but each step has its little nuances that have to be taken into account. Let's get over some of them.
Obtaining a blank Certificate of Organization should not be a problem if you know where to look for it. The easiest way is to go to the Forms, Samples and Fees section at the official website of the Secretary of California and download your copy of the Articles or any other document that you may find necessary for your Californian business. Here is the direct link to the form in PDF format for your convenience.
Some business formation services also provide free templates of various LLC and corporation documents. For example, Northwest Registered Agent allows you to download a printable file for free, while LegalZoom gives access to a sample form of the Articles of Organization in California that you can recreate in a text editor. You can also fill out the form online and then print it out for personal use.
Once you have a printed articles of organization California template in front of you, it's time to fill it out. As you will see, there are several points that must be completed:
First, you need to come up with your company's name. Keep in mind that this name is not official until the government approves it, so try to keep it nice and civil.
There are several words that you must avoid when naming a Californian limited liability company:
Don't forget to include the business structure tag somewhere in the name. For example:
If you fail to add one of these tags into the articles of organization, you'll be given the "LLC" extension by default.
Finally, the name should not be misleading or sound similar to other existing brands. Make it clear, simple, and easy to pronounce.
Next, you need to specify the physical address of your main office. It must be a street number within the state of California – no post office boxes are allowed.
Once you're done with that, you need to include a mailing address at which your LLC is going to receive corporate correspondence. Here you can actually use a PO box or a street number that is located outside of California. If your mailing address is the same as your office location, you can skip this item.
The third item that you can see in the Articles of Organization in California template is a registered agent address.
A registered agent in California is a middleman between your company and the state government that receives federal and legal mail on your behalf. It can be a business or an individual of at least 18 years of age that has a physical address in the state of California. Additionally, a registered agent must be available at that location during standard business hours (Mon–Fri, 9 AM–5 PM) to accept the delivery.
You can designate yourself as your own registered agent, but we highly recommend against it. Having a third-party service as your agent has a few undeniable benefits, such as:
If you decide to use a specialized service, you only need to include its name. In case you go with a specific person as your agent, then you have to list their full name and a street address with the ZIP code.
An LLC can be managed by one or several people, and the state government needs to know exactly how your business will be operated. In some states, you need to fill in the blanks with the full names and addresses of each manager. However, in the certificate of organization in California, the process is simplified to checking one of the three available boxes:
The Secretary of State also wants to know what your LLC is being created for. Most states accept a simple statement like this: "The purpose of the limited liability company is to engage in any lawful act or activity." There are a few states where you will need to get into some details of your business, for example, "car rental service".
Luckily for you, in all Articles of Organization for California examples, the purpose statement is already filled in and can't be changed.
Last but not least, the document must be signed by the organizer. It can be you, another staff member, or a completely random person who will be responsible for the preparation of the Articles of Organization in California and filing the papers with the Secretary of State. If you utilize a business formation service to start your LLC in California, this document will be signed by one of its representatives.
Note: all writing in the Certificate of Organization in California has to be done with either a blue or black pen.
When the document is complete and signed, it's time to send it to the Secretary of State. Filing the Articles of Organization in California can be done by mail, in person, or online. We'll discuss the latter option a bit later, and now let's take a look at more traditional methods.
Sending the Articles by mail is as simple as it gets: just put the form in the envelope and send it away. However, submitting the Articles of Organization in California implies a $70 fee, so your letter has to come with a check or money order to the Secretary's name. Sending cash is prohibited. The filing fee can't be returned, so make sure your business name is legit and check your papers several times for mistakes before sealing the envelope.
Tip: use a free business name search tool like this one or this one to check if your desired name is available.
If you happen to live in Sacramento or Los Angeles, you may try to deliver the formation documents to the Secretary building yourself. In Sacramento, you can do it during regular business hours and then pick the documents up from 2 to 2.30 PM when they're ready.
In Los Angeles, the Articles can be dropped off from 9 to 5 AM as well, but you can only get them back by mail.
Keep in mind that delivering the form in person is not free and costs $15, making it $85 total. On the bright side, you can pay with cash or a credit card right on the spot.
Another benefit of submitting the formation documents personally is the ability to speed up the processing time. The Secretaries of State are notoriously slow with the paperwork, and unfortunately, California is no exception. But there's nothing that can't be done a bit faster with some extra money involved.
Note: fast turnaround feature is only available in Sacramento.
Since we're living in the 21st century, filing the Articles of Organization for your California LLC can be done from a computer or smartphone. First, you need to head on to the Secretary of State's website and create an account. (If you already have one, just skip this step and log in as usual).
Note: filing documents and placing orders online is impossible without a valid user account.
After a successful login, you will find a menu with a selection of online services, such as:
The last item from this list is what we came here for. There, you can choose your business structure and upload the required documents from your computer storage. The Secretary of State accepts credit card payments for online orders, so the entire submission process can be finalized in a few clicks.
After you've completed the filing process of the Articles of Organization in California, all you have to do is wait for the state's approval. If the government finds any mistakes or inappropriate data in your document, it will send your Articles back and you'll have to fill the form out all over again (and pay another $70 as well).
If the formation papers are accepted by the State of California, congratulations! Your business is officially registered! Now you can focus on the next steps of building your enterprise and bringing it to success.
Note: 3 months after submitting the Articles of Organization, you must file the Initial Statement of Information which serves as the first annual report of your newly created LLC.
|California Secretary of State Mail Address||Business Entities Filings|
PO Box 944228
Sacramento, CA 94244-2280
|Sacramento Main Office Address||1500 11th Street|
Sacramento, CA 95814
|Los Angeles Office Address||300 S Spring Street #12th|
Los Angeles, CA 90013
|General Information||(916) 653-6814|