Term
Minimum LLC tax: definition
Snapshot
- Also called
- Franchise tax, entity tax
- Pairs with
- Annual report in company with Articles of organization in company with Member
Why it matters
The minimum tax is billed separately from the annual report fee, which means paying one does not satisfy the other. The state's own wording below gives the basis for the amount and the due date, and you should track both dates on your calendar.
To stop the tax, dissolve the LLC through the state and ask for written confirmation that the charge has ended. Simply ceasing business is not enough, because the state keeps billing a company that is still on its books.
By state
Only 3 states levy a minimum tax on LLCs. Find yours below before choosing where to form, since the charge can exceed the filing fee within a few years.
- California: $800 a year minimum LLC tax to the Franchise Tax Board (Form FTB 3522), separate from the Statement of Information.
- Kentucky: Limited Liability Entity Tax: a $175 minimum each year to the Department of Revenue.
- Rhode Island: $400 a year minimum tax to the Division of Taxation (Form RI-1065), owed whether or not the LLC makes a profit.
Where it applies
Applies in these answers: What does each state want to form an LLC?, Registered agent rules by state, What does each state want from a foreign LLC?.
Sources
- Reference line for California other cost: Annual LLC, drawn from ftb.ca.gov and confirmed October 2026, as noted by our editors
- Reference line for California other cost: Annual LLC, drawn from ftb.ca.gov and confirmed October 2026, as noted by our editors
- Reference line for Kentucky other cost: Limited Liability, drawn from revenue.ky.gov and confirmed October 2026, as noted by our editors
- Reference line for Rhode Island other cost, drawn from tax.ri.gov and confirmed October 2026, as noted by our editors