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Texas LLC owned by California Sole Proprietorship

Oceanside, CA |

I have just moved to California and I plan on creating a sole proprietorship in California. I had lived in Texas in the past and had created a Texas LLC during that time. I do not want to register the LLC in CA because of $800 minimum tax on LLC's in CA. Can I have the CA sole proprietorship own the TX LLC and avoid the $800 tax?

Attorney Answers 3


  1. Apparently no based upon what several CA attorneys have posted in regard to this very same question.

    My answer is not intended to be giving legal advice and this topic can be a complex area where the advice of a licensed attorney in your State should be obtained.


  2. In order for the TX LLX to do business in CA it must register with the Secretary of State as a foreign corporation; once registered with the Secretary the $800 minimum tax will be imposed.

    This answer is provided as a public service and as a general response to a general question, it is not meant, and should not be relied upon as specific legal advice, nor does it create an attorney-client relationship.


  3. You could have the California Sole Proprietorship buy the assets of the Texas business and operate as an S P in CA. This has tax advantages and liability disadvantages.

    Don't forget about business license and fictitious name issues.

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