A California C-Corporation is the classic structure for companies planning to receive capital investment, offer employee stock, or eventually go public. It is the preferred structure for Venture Capital and the only one allowing real stock options for employees. Form your C-Corp with California-valid documents, bilingual, without an attorney, from $399.
A C-Corp makes sense when: you plan to raise capital from professional investors (Angel/VC), want to offer stock options to key employees, your business will have multiple shareholders, you plan to expand to other states or internationally, you operate in sectors like technology or biotech, or you eventually want to go public (IPO). For small or single-owner businesses, an LLC or S-Corp is usually better — the C-Corp has "double taxation" (corporation pays tax on profits, shareholders pay tax on dividends).
California taxes C-Corps at 8.84% state tax on net income (minimum $800/year). The C-Corp pays federal tax on profits, and shareholders pay tax on dividends — this is "double taxation." However, the C-Corp allows retaining earnings inside the company for reinvestment, has no shareholder limits (S-Corps are limited to 100 US-citizen/resident shareholders), and is the preferred structure for all Venture Capitalists. It has strict governance requirements: Board of Directors, annual meetings, formal minutes.
C-Corp is the "regular" corporation. S-Corp is a tax election where the corporation does NOT pay tax at the corporate level (profits pass through to shareholders). S-Corp has restrictions: max 100 shareholders, all must be individuals (not entities) US citizens or residents.
VCs require Delaware C-Corp for technical reasons (preferred stock, options, employee packages). If you plan to raise VC capital, consider forming in Delaware from the start but register as a Foreign Corporation in California. Our package covers California; for Delaware, consult an attorney.
In California, a C-Corp can have one director if there is only one shareholder. With two shareholders, the Board can have two. Three or more shareholders require minimum three directors.
Yes, you need Bylaws. They are NOT filed with the state, but they are mandatory — they are the corporation's internal operating manual.
$399 with Multi Servicios 360. An attorney would charge $3,000-$5,000. Plus $70 state fee + $800 initial franchise tax.
Multi Servicios 360 is a self-help legal document preparation platform. We are not a law firm and do not provide legal advice.
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