California Corporation San Diego
California Corporation San Diego Summary
Operating a business as a California corporation formed by San Diego Corporate Law may have several, distinct advantages over sole proprietorship and other forms of business organization, including:
• Limiting personal liability against claims from lawsuits and creditors;
• Raising capital from investors by issuing stock and/or bonds;
• Obtaining credit without making a personal guarantee;
• Reducing self-employment taxes for shareholders earning wages; and
• The availability of fringe benefits, such as medical care and retirement.
All California corporations formed by San Diego Corporate Law include attorney-drafted articles of incorporation, bylaws, federal EIN application, corporate records book, stock certificates, and minutes for the organizational meeting of the board of directors..
Flat Fee Price
- Includes Filing Fees
- See Pricing Assumptions
- Securities Issuance by Quotation
Michael J. Leonard helped us obtain out 501(c)(3), created our bylaws, and completed all of the necessary forms to establish a tax exempt status for our non-profit foundation. He was professional, quick, and great to work with. Mr. Leonard is also very connected in the community and has referred us to useful contacts.
Michel Sproles, Sproles Empowered Youth
My experience working with San Diego Corporate Law has been nothing short of excellent. Michael Leonard is a tremendous asset, and provided us much needed assistance when forming our insurance agency. He assisted with the formation of our corporation, buy / sell agreement, company bylaws, minutes, and stock certificates. Michael is an utmost professional that I would refer to any friend or client.
Michael Fusco, Fusco & Orsini Insurance Services, Inc.
Michael J. Leonard at San Diego Corporate Law has provided GWR valuable assistance and professional advice. As a San Diego based high tech equipment manufacturer, we appreciate that we never have to waste his or our time explaining the engineering or scientific details of our situation as his strong, hands on physics and engineering background is invaluable. We are well protected with Mike looking out for our interests.
Richard Reineman, GWR Instruments, Inc.
In 2009 San Diego Corporate Law converted my Sole Propriety Engineering Company into a “S” Corporation. My experience was painless and Mr. Leonard has done an excellent job staying in contact and continues to be a great advisor. San Diego Corporate Law comes highly recommended.
Curtis Patterson, P.E., Patterson Engineering, Inc.
Michael J. Leonard at San Diego Corporate Law is not your typical attorney experience. Michael puts his full attention into understanding your needs and provides the best solution to meet your goals. I highly recommend San Diego Corporate Law to any of my friends and associates.
Jeff A. Mudd, Best-Rate Repair Company, Inc.
Working with San Diego Corporate Law made dealing with all the paper work of incorporating and setting up my business a dream! Michael is the ultimate professional and knows corporate law inside and out! San Diego Corporate Law is always available to answer questions, assist me with follow up items, and be my go-to and support team.
Elloise Bennett, AP Test Service, LLC
Mr. Leonard is competent, dependable, and gets the work done on time and within budget. He is very responsible to his customers. We would recommend him to anyone that requires a true professional.
Lidija Skolnija, anaZana, Inc.
I was recommended to Michael to help me set up a new corporation I was starting. The advice he gave me was great, and I eventually hired his services to create the agreements and contracts between myself and my business partner. Throughout the process he guided me and asked very detailed questions. I felt that he had my back and my best interest at heart. Looking back now, the contracts he wrote have saved me close to $40,000 in money that I would have otherwise had to pay. Thank you Michael. Everyone should follow your standards.
Jason Delfos, Marketing and Advertising Design Group, LLC
We hired San Diego Corporate Law to help us establish our business in San Diego. In the initial stages of setting up our business and transitioning to California, we were frequently out of town. During this time, Michael answered questions promptly and thoroughly by phone and email. He went above and beyond to keep us on deadline for our aggressive schedule. I would not hesitate to recommend San Diego Corporate Law to another business owner.
Alicia Sorber-Gallegos, Two Men and a Truck
Having no prior experience with business law, I approached Michael to help me set up an LLC for my new company and help me review my legal disclaimers. Michael was very straightforward, honest and helpful. He took the time to explain every detail and answer all of my questions. His work was very diligent and completed exactly by the deadline promised. Michael and San Diego Corporate Law hold my highest recommendation!
Anton Ivanov, Dreams Cash True
Michael J. Leonard helped me configure my business entities into a solid investment vehicle. He is very professional, knowledgeable, easy to reach and timely. San Diego Corporate Law produced a unique and informative Private Placement Memorandum (PPM) for my business for less than half the cost other law firms were charging. I expect to use the PPM and San Diego Corporate Law for many years. I recommend Michael because of his efficient, hands on, practical approach to legal work in a time of dramatic changes with securities laws (JOBS Act).
John Copyak, Clean USA Power, Inc.
San Diego Corporate Law helped me set up MGIV Inc and get established as an S-corp in 2013. I was a one man show and didn’t have a substantial amount of money to spend to get started. I was in the process of filing for a LLC through Legalzoom.com when something didn’t feel right. I picked up the phone and asked Michael if he was available to help. This was my first business so I knew nothing about filing for a corporation or legally establishing a business. Using his knowledge and expertise he coached me toward filing for an S-corp instead of an LLC. It saved the corporation $800 in 2013 and positioned it for success based on the MGIV Communication Consulting model. I find comfort knowing that my business is in good hands. Michael is a great resource and very personable so working with him is convenient and affordable! I recommend San Diego Corporate Law to anyone needing legal assistance with their business!
Michael Gordon IV, MGIV, Inc.
When I needed to move my business from an office suite to a brick and mortar location, San Diego Corporate Law was instrumental in ensuring that the lease provisions were in my best interests. The specialized skills that Michael and his team possess, the fair and transparent fee structure, and their professional yet low pressure consultation process are the reasons why I will retain their services in the future.
Scott Weathers, Alpha Graphics La Jolla
Michael J. Leonard at San Diego Corporate Law not only helped us establish our small business in San Diego, but he helped us to solidify our partnership to avoid any gray areas as we are a family-run business. Michael was easy to work with, knowledgeable, responsive, and professional, and we will continue to use him as our company lawyer moving forward.
Karen Posner, Camp Run-A-Mutt Sorrento Valley
I have nothing but compliments to say about San Diego Corporate Law. Michael and his team have always delivered not only an extremely high level of service, but also have been so patient through the whole process of setting up our LLC. Whenever I have questions or need their service, they are very easy to communicate with and very reasonably priced. I will not only use them for any legal advice that I may need in the future, but also refer all the people that may also need their services.
Andrey Kamogari, Kamo Housing
Michael assisted us with the process of incorporating our non-profit organization. Michael was responsive to all of our questions, and sensitive to the expedited timelines that we encountered. Among the best aspects we experienced in working with Michael was his appreciation for our specific goals and his candid and honest guidance to accomplish those objectives. I would highly recommend Michael Leonard and San Diego Corporate Law.
Esther Hemmen, Mending Matters
San Diego Corporate Law has been a crucial partner for Little Black Diamond. Whether it’s routine incorporation paperwork or complex employment law, Michael is always very responsive and available to help handle our legal issues. He takes the time to understand your business and the unique issues that surround it in order to provide accurate and timely advice that considers the best interest of your business. San Diego Corporate Law is a true partner for any business.
Adam Rosenberg, Little Black Diamond, LLC
California Corporation San Diego Details
A California corporation is a limited liability entity in which the business owners, called shareholders, are not responsible for business debts, liabilities, or other obligations.
One or more natural persons, partnerships, associations, or domestic or foreign corporations may form a California C Corporation. California Corporations Code § 200(a).
A California corporation is formed by filing articles of incorporation with the Secretary of State. California Corporations Code § 200(c). The filing fee for articles of incorporation is currently $100.00. California Government Code § 12186(c). Bylaws, which dictate how the corporation operates, must be adopted.
Shareholders (owners of a California corporation) may enter into an optional, separate agreement restricting the sale or transfer of shares of the corporation’s stock, a formula for determining the value of shares upon transfer, voting provisions, and other clauses.
The shareholder of a California corporation is not liable for the debts and obligations of the California corporation, unless: (1) the shareholder personally guarantees a debt or obligation; (2) the shareholder engages in tortious conduct; (3) the shareholder receives improper distributions of the California corporation’s assets; (4) the shareholder intermingles personal and corporate matters (alter ego; piercing the corporate veil); or (5) the shareholder breaches a duty owed to other shareholders.
A shareholder who acts as a director and/or officer of a California corporation may have increased liability stemming from his or her actions as a director and/or officer.
The names of California corporation shareholders are not a matter of public record. However, other shareholders of the California corporation have the right to inspect the books and records of the corporation, thereby learning the names of fellow shareholders.
The names of officers and directors of a California corporation are a matter of public record.
Unless otherwise named in the articles of incorporation, the incorporators appoint the initial directors of a California corporation. California Corporations Code § 210. After shares of stock in the California corporation have been issued, the shareholders vote annually to elect a board of directors, and the elected directors then elect officers to handle the day-to-day management of corporate operations. A California corporation must have a president, a secretary, and a treasurer/chief financial officer. Other officers may also be elected in addition to the three required.
Shareholders exercise no management in a California corporation. When shareholders do exercise control of management, the corporation risks losing its limited liability protection.
California corporation shareholders contribute assets to the corporation in exchange for shares of stock. If the assets contributed are non-cash, the fair market value of the assets establishes the price of the stock.
A California corporation may issue one or more classes of stock. Different classes of stock may have different voting rights, preferences, privileges and restrictions, as stated in the articles of incorporation. At least one class of stock must have voting rights and unlimited dividend and liquidation rights. California Corporations Code § 400(a).
Shares of stock in a California corporation are usually characterized as securities.
Federal Securities Issues
Federal securities laws should be considered when issuing stock in a California corporation. Regulatory filings may be required either to qualify an offering and sale or to receive an exemption. California Corporations Code §§ 25000-25707; 10 California Code of Regulations §§ 250.9-260.617.
California Securities Issues
All offers and sales of securities in California require qualification with the California Department of Business Oversight unless either the transaction or the security itself is exempted from qualification. The securities laws of other states may also apply to offers or sales of stock made outside California.
Other State Securities Issues
The securities laws of other states (“blue sky” laws) may also apply to offers or sales of California corporation stock made outside California.
The net income of a California corporation is taxable by both the federal and state governments at corporate tax rates.
If the California corporation distributes dividends to shareholders, the shareholders must report the dividends received as income. This dividend income will be subject to both federal and state income taxes. Taxation of dividends is commonly referred to as “double taxation” because the corporation’s net income is taxed twice: first at the corporate level and again if distributed as dividends to the shareholders. Dividend payments made to shareholders are not treated as an expense of the corporation.
Double taxation may be minimized by the payment of wages to shareholder-employees, by payment of fair market rent or royalties of assets owned by shareholders, or by payment of fair market interest on a debt owed to shareholders.
A California corporation that retains most of its income as capital reinvestment in the business may benefit from the corporate tax structure because the marginal rates applicable to corporations may be lower than the marginal rates applicable to individuals.
California corporations must pay a minimum annual franchise tax of $800 to the State of California’s Franchise Tax Board for the privilege of doing business as a limited liability entity.
Employment taxes and workers’ compensation insurance must be paid on employees’ wages.
If not restricted by shareholder agreements or securities law requirements, a shareholder can readily transfer stock to a new owner.
Change of ownership does not dissolve or terminate a corporation.
A California corporation can be dissolved by a vote of 50% or more of the voting power of the corporation’s shareholders and the subsequent filing of a certificate of election with the Secretary of State. California Corporations Code §§ 204(a)(4), 1900(a), 1901.
The organization of a California corporation for the pricing listed on this page assumes a single class of stock. More complex organizations available by quotation. Filings required by applicable federal and blue sky securities laws available for additional fees and with additional costs.
California Corporation Questions?
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