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Attention California Corporation Owners

Do you have a California corporation with no sales or no income?  Did you set up your corporation in the last quarter of 2011 and planning to start your business in 2012?  You operated business in 2011?

If you have set up a corporation at any time during the year 2011  than you are required to file the California Tax Return for the year 2011.  In case you had no income or have not started your business until now,  you are still required to file the tax return and pay a minimum of $800 California Corporation Franchise Tax. This is the minimum tax and all California corporations are required to pay even if they had incurred a loss or had no income for the taxable year.

What if you had LLC, C-Corp or S-Corp?

Make no mistake – California Corporation Franchise Tax applies to all kinds of corporations.  As long as you were registered in the state of California as corporation during the tax year, you are required to fine the California Corporation Franchise Tax Return and pay the tax.   Failure to file the tax return can ensure penalties and interest.

I didn’t do any business last year, how can I avoid paying a minimum $800 tax?

In most cases, you will have to pay the minimum tax but it certain cases you can get relieved from this minimum tax.   There are certain rules that need to follow.   We recommend you contact your certified public accountant or give our office a call to discuss your options.

$800 Minimum Tax is only required in 2nd Year of Business:

A good way to look at this is that in California, you are not required to pay the California Corporation Franchise Tax when you incorporate your business or your first year of business.  You pay the tax for next year but you pay in advance when you file the tax return for the previous year.

Office of Sanjiv Gupta CPA can help you file California Corporate Franchise Tax Return and work with you to reduce your tax liability and improve your bottom line.  If you live or work around Fremont, Palo Alto, Cupertino, Sunnyvale, San Jose or San Francisco Bay Area than we recommend you make an appointment to come into our office for a consultation.   We also offer appointments by phone for those who can’t come to the office.  You can reach us at 510-825-7563 to get your California Corporation Franchise Tax questions answered.

You only got a couple more days left to file the 2011 Franchise Tax Return.  Our office is open during the weekend to accommodate the last-minute filing by San Francisco California Corporations.  You can still make it in time and avoid any late penalties.


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