LLC and S-Corp Formation in Redondo Beach, CA

The entity you choose shapes your tax bill, how you pay yourself, and how well you are protected. Tax Scout helps you form an LLC, partnership, or S-Corp, and because we are tax professionals first, we recommend the structure that makes the most sense for your taxes.

Please note: we assist with business formation filings and tax elections. We are not attorneys and do not provide legal advice. For liability or contract questions, consult an attorney.

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Single Member LLC

A California LLC offers limited liability protection and pass-through taxation. Single member means one owner. Key points:

  • Reported on Schedule C with your personal return, typically due April 15
  • California charges an $800 annual minimum franchise tax, plus an LLC fee once gross receipts reach $250,000
  • Simple to run, with minimal extra accounting

Partnership LLC

The same protection and pass-through taxation, with more than one owner. Key points:

  • Federal Form 1065 and California Form 565 or 568, depending on structure
  • Every partner gets a K-1 showing their share of income
  • A written operating agreement is strongly recommended (ask your attorney)

S-Corp

An S-Corp is a tax election, not a type of legal entity. Your LLC or corporation elects to be taxed this way. Key points:

  • Potential tax savings through a salary-plus-distributions structure
  • Payroll, reasonable compensation rules, and additional accounting apply
  • Federal Form 1120S and California Form 100S, usually due March 15
  • California taxes S-Corps at 1.5% of net income, with an $800 minimum

After your entity is set up, our Small Business Tax Experts take over your ongoing strategy and filings. Need clean books from day one? See Bookkeeping Services. Holding rentals in an LLC? See Rental Home Tax Accountant.

Frequently Asked Questions:
Business Entity Formation

Think of an LLC as the legal container you register with the state, and an S-Corp as a different way of being taxed. Once the tax savings outweigh the added payroll and accounting work, your LLC can choose S-Corp taxation. In California, S-Corps also pay a 1.5% franchise tax on net income (minimum $800), so we crunch the federal and California numbers before suggesting it.

Usually, if you earn business income and own things you want to protect. An LLC separates business debts and claims from your personal assets, and it opens the door to elections like the S-Corp. In California, an LLC also means the $800 annual minimum franchise tax, so it should be worth the cost. A quick call will tell you if it fits your situation.

A common rule of thumb is once net profit regularly reaches about $50,000. In California, the 1.5% S-Corp franchise tax can push that break-even point higher, so we run the numbers for both returns. Elections are generally due March 15 for the current year, though late elections are sometimes possible. Call us to talk it through.

The $800 minimum franchise tax, an additional LLC fee once gross receipts reach $250,000, and a Statement of Information filed with the Secretary of State every two years. Filing fees change, so we confirm current amounts at formation.

If you live and operate in California, you will generally owe California taxes and registration either way. An out-of-state LLC doing business here must register as a foreign LLC and still pay the $800 minimum franchise tax, so forming elsewhere often adds cost without saving tax. We review your situation first.

The business doesn’t pay federal income tax on its own. Its profit flows to the owners and is reported on their personal returns. LLCs, partnerships, and S-Corps are all taxed this way. California is the exception at the entity level: LLCs pay the $800 franchise tax plus a gross receipts fee, and S-Corps pay 1.5% of net income (minimum $800).

Yes. Many owners begin with a single-member LLC and move to S-Corp taxation as profit grows. Other changes, such as adding a partner, come with tax consequences, so plan them in advance.

A filing website sends in forms and knows nothing about your taxes. We pick the structure by looking at what you will really owe, then file the paperwork, get your EIN, make elections on time, and prepare your returns afterward. One accountable team, every year.