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Why Start a San Diego LLC?

Often considered to have the most desirable climate in the U.S., the city of San Diego is more than great weather — it’s also known for its extremely favorable small business climate. If you start an LLC in San Diego, just like starting an LLC in California anywhere, you’ll get a good dose of business-friendliness from the city government and infrastructure.

San Diego is one of California's oldest and most historic cities, and it’s known as a center for tourism, research, and manufacturing. Not everyone in San Diego spends their days soaking up rays or catching waves — you’ll also find scientists, engineers, and leaders of industry making waves in this stunning city.

Your business could make a few waves, too, if you decide that setting up a San Diego LLC is right for you. Read on to learn all the steps you need to take in order to start your San Diego LLC.

Benefits of Starting a San Diego LLC:

  • City government provides financial incentives to businesses that meet requirements

  • Quicker permit processing to get businesses up and running

  • Lower formation costs than many other states

  • Greater transparency and communication from city officials

  • Protection for your personal assets and privacy

But that’s not all. San Diego is a gorgeous and safe city with a fantastic education system, a strong military presence, and a thriving arts and entertainment scene.

Ready to form your San Diego LLC? Here’s how:

 

How to Form a San Diego LLC Yourself in 6 Steps

Ready to get started? Follow these steps to DIY your San Diego LLC and launch your business on the sunny side.

1

Choose a Unique Business Name and Complete a State Business Search

When picking a name for your business, be aware that it must be different from every other business in the state of California. A unique name will help your San Diego business stand out from the competition, but that uniqueness is also a requirement for formation.

 

If you need a little squeeze to get those creative juices flowing, check out our Business Name Generator to start gathering ideas. Also take a look at some California naming regulations you’ll need to know. 

Found the perfect name? Before you seal the deal, you have to make sure it’s available in San Diego by checking all the registered business names in the state of California. Use our California Entity Search to easily determine if your selected name is free to use.

There’s no need to stress if your first pick isn’t available. You can revisit the name generator and switch up your keywords for some fresh ideas. Just remember to check URLs, too, as you’ll want your web address to be as close as possible to your business name.

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2

Provide an Official Business Address (or Get a Virtual Address)

To legally form your San Diego LLC, you’ll have to have a street address. A P.O. box won’t work, and you may not want to use your home address. So, what can you do if you don’t have a workspace with a street address? You can secure one by using a Virtual Address service.

When you select your state, you’ll receive a real, legal street address that you can then use to form your business with the state. Depending on the service you select, you’ll also get plenty of other perks and benefits, like digital mail management.

 

For instance, with Incfile’s service, your mail will be scanned and sent to your email, where you can read through it from anywhere. Important documents, such as checks, will be forwarded to you, and everything else will be shredded.

3

Assign a Registered Agent

A Registered Agent is an individual or service provider who receives official documents on your business’s behalf. In California, it’s referred to as an Agent for Service of Process. Tax documents, subpoenas, or legal notifications may all be part of what a Registered Agent receives. An agent’s duties take place year-round, during all business hours.

That’s one of the reasons why it isn’t the best choice to act as your own Registered Agent. It can restrict your freedom to travel, be away from your registered address, or move or expand your business.

Privacy is an additional concern. Sensitive documents may be served at your listed address, which may be your home. This can also make your home address known to individuals whom you prefer not to grant access.

By using a Registered Agent service, you’ll be appointed an Agent for Service of Process in your state who will then receive your critical documents and make sure they get to you safely and securely, all while keeping your time and your privacy protected.

4

File Your Articles of Organization With the California Secretary of State

When it’s time to make your San Diego LLC official, you’ll need to file your Articles of Organization. This legal document makes your business legitimate when it’s filed with the California Secretary of State.

To file yourself, you’ll need to fill out form LLC-1 through the California Secretary of State Business Programs Division. Make sure you have all of your important info together before you begin.

Here’s what you'll need:

  • Your business name and address
  • Information about your Agent for Service of Process 
  • The management structure of the business
  • The name of the LLC organizer

Once completed, you can file online with the California SoS. You also have other filing options, including:

File by Mail

California Secretary of State
Business Entities Filings
P.O. Box 944260
Sacramento, CA 94244-2600

Submit in Person

1500 11th St.
Sacramento, CA 95814
(Open M–F 8 a.m.–5 p.m.)

Be prepared to pay an additional $15 handling fee if you take your paperwork to be filed in person. The higher cost usually means less wait time, as your application will be prioritized over online applications.

Articles of Organization filing only happens once, but every year, you’ll need to file and possibly pay the California Franchise Tax. You’ll also need to file a biennial Statement of Information and pay a $20 filing fee. The first biennial statement, which you can complete via Form LLC-12, is due 90 days after formation.

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What Are the Fees and Requirements to Form a San Diego LLC?

State Fee

$75*

State Filing Time

4 Weeks

Expedited Filing Time

3 Business Days

*This fee is comprised of a $70 filing fee + $5 certificate fee.

Statement of Information

Frequency

Biennially

Due Date

First statement is due within 90 days of formation. After that, it’s due during the 6-month period that ends on the last day of the anniversary month of formation.

Filing Fee

$20

California Franchise Tax

Frequency

Annually

Franchise Tax Fee

Due the 15th day of the 4th month after your LLC was formed and annually on that date from then on.

Filing Fee

$800 minimum

5

Get an Employer Identification Number (EIN) From the IRS

Just as most adults have a Social Security number to identify them to the government, many businesses have an EIN, or Employer Identification Number. This number is assigned to businesses that apply for it with the IRS, and it’s used to identify your business at tax time.

EINs are typically required for businesses with employees, but they may also be necessary for other businesses as well. An EIN will help you with many business processes, including opening a business bank account, securing a loan, and applying for business credit. 

To get an EIN on your own, apply directly through the IRS website. That service is free, but there are some restrictions about when and how you apply. To take the stress out of the situation, you can use an EIN service like Incfile’s to file the paperwork and digitally deliver your EIN in one business day.

6

Create an Operating Agreement

An operating agreement is another extremely important document for LLCs, as it provides a path forward in times of uncertainty and can be a source of guidance during conflicts between LLC members. 

Operating agreements are required for California LLCs, so you’ll need to file yours with the state. Your San Diego LLC can certainly benefit from having a strong operating agreement as its foundation.

You can create your own operating agreement, but to give yourself peace of mind and ensure the information is completed correctly, you may wish to use an operating agreement template. Get a standalone operating agreement or have it included with your Gold or Platinum business formation package from Incfile.

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Other San Diego LLC Types

A standard LLC isn’t always right for every business. Depending on your location, you may have some options, including these:

Series LLC

A series LLC allows you to set up multiple LLCs under one parent LLC. Series LLCs are not available in California, but you may be able to operate your SLLC in California if it was formed in another state (and you meet the requirements).

Professional LLC

A professional LLC is just like a regular LLC, but the owner is also a practitioner in a particular professional field. A Professional Limited Liability Company (PLLC) as its own unique entity is not recognized in San Diego, but you might still be able to start an LLC if you offer professional services in certain fields, which you can read about in California’s legislative codes. 

If you’re starting a professional services business in San Diego but don’t meet the requirements listed in the code, you might want to consider starting a California corporation instead. 

Foreign LLC

At some point, you may want to grow your business to a different state, or you may want to start a new business in a state in which you do not reside. If that’s the case for your San Diego LLC, you might need to apply for foreign qualification. By doing so, your business will be seen by the IRS as a foreign LLC, which will allow you to grow your operations.

Read More: California Foreign LLC Registration

Helpful Resources for San Diego, CA Businesses

Common Questions About Creating an LLC in San Diego

Need more details about starting a San Diego LLC? We are here to help.

What Is Needed to Start an LLC in San Diego?

To start an LLC in San Diego, you’ll need a business name that isn’t in use anywhere in the state, a named Registered Agent, a street address in California, and the names and addresses of all LLC members and your LLC organizer. In California, you’ll also need an operating agreement for your business.

How Much Does a Business License Cost in San Diego?

The cost of business licenses varies based on the purpose and the industry. In California, most business licenses will run between $50 and $100, but some will cost less and others more. Many permits and licenses are applied for at the city or county level, so be sure to check with San Diego city officials before you get started.

Do You Need a Business License to Sell Online in San Diego?

There is no specific business license needed at the city level if you plan for your San Diego-based business to sell online. You will, however, need to apply for a San Diego Business Tax Certificate in order to pay taxes on revenue generated by your online business.

Where Do I Register My Business Name in San Diego?

You will register your business name for your San Diego LLC when you file your Articles of Organization. If you later need to operate under another name, you can file with the San Diego County Clerk for a fictitious business name, or you can file an amendment to your Articles of Organization.

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