Closing a California LLC takes more steps than most other states. You're dealing with two separate filings with the Secretary of State (LLC-3 and LLC-4/7), a final tax return with the FTB, and that infamous $800 minimum franchise tax that may be due even in your final year.

Skip any of these, and the Franchise Tax Board will keep sending you notices — sometimes for years. This guide walks through every step in the right order so you close the book cleanly.

The good news: both SOS filings (LLC-3 and LLC-4/7) are free in California. The cost in dissolving a CA LLC is mainly your time and that final $800 annual minimum.

Before You File: What California's Dissolution Process Actually Looks Like

Most states require one dissolution filing. California requires two — plus a separate FTB closing process. Here's the high-level sequence before we go step by step:

1. Member vote → document the dissolution decision in writing
2. Wind up → pay debts, notify creditors, distribute remaining assets
3. File Form 568 final return with the FTB (check "Final Return")
4. File LLC-3 (Certificate of Dissolution) with the California SOS
5. File LLC-4/7 (Certificate of Cancellation) with the California SOS

The order matters. You cannot file LLC-4/7 without LLC-3 already confirmed. And file your FTB final return before or alongside your SOS filings — the FTB and SOS don't automatically communicate with each other.

Step 1: Hold a Member Vote and Document the Decision

Before any state filing, the LLC's members must formally agree to dissolve. How this works depends on your operating agreement:

• Single-member LLC: You decide and write a brief dated resolution — a paragraph stating the date and your intent to dissolve is enough in most cases.
• Multi-member LLC: Check your operating agreement for the required vote threshold (often majority or unanimous). Hold a meeting, record the vote, and keep signed minutes.

California law (Corp. Code §17707.01) allows dissolution by unanimous written consent of all members, or by a vote as specified in the operating agreement. If members can't reach agreement, a court can order judicial dissolution — but that route is costly and slow.

Keep your written resolution. The SOS doesn't require it during online filing, but it's your legal protection if a creditor or former member challenges the dissolution process later.

Step 2: Wind Up the Business — Debts Before Assets

Before filing any state paperwork, you need to wrap up the LLC's financial affairs. California law requires the LLC to:

• Pay or arrange to pay all known debts and obligations — employees, vendors, leases, loans
• Notify known creditors in writing and give them a deadline to submit claims (typically 90–120 days is reasonable)
• Cancel business licenses and permits with your city, county, and any state agencies
• Close EDD account if you had employees (file final payroll returns)
• Close CDTFA seller's permit if you collected California sales tax (file a final return)
• Distribute remaining assets to members according to the operating agreement — only after debts are settled

California doesn't require you to publish a dissolution notice in a newspaper. But sending written notice to creditors protects members from future personal liability. If a creditor claim appears after member distributions are made, members can be held responsible up to the amount they received.

Step 3: File Your Final California Tax Return (Form 568)

This is the step most people miss — and it's what causes years of ongoing FTB notices after the LLC is supposedly closed.

Every California LLC must file Form 568 (LLC Return of Income) as its final state tax return. The critical action: check the "Final Return" box at the top of the form. Without it, the FTB assumes your LLC is still active and will keep billing you the $800 minimum franchise tax annually.

Key details for your final Form 568:

• Due date: 15th day of the 3rd month after your LLC's taxable year ends — March 15 for a December 31 fiscal year
• Check "Final Return" at the top of Form 568 to notify the FTB to close your tax account
• Single-member LLCs: also file a final federal Schedule C (or E) with your personal Form 1040, checking the "final return" box there too
• Multi-member LLCs: file a final federal Form 1065 and issue final Schedule K-1s to all members

If your LLC's last full year was 2025 but you're completing the dissolution in 2026, you'll need to file a 2025 Form 568 and a final 2026 Form 568. The 2026 return is the one where you check "Final Return" — that's the signal that closes your FTB account.

Step 4: File LLC-3 (Certificate of Dissolution) with the SOS

Once your debts are settled and your FTB return is filed (or in progress), you file with the California Secretary of State. The first form is Form LLC-3: Certificate of Dissolution.

LLC-3 is a short form that records your members' vote and officially starts the winding-up period on the public record. Here's what you'll need:

• Your LLC's exact legal name and SOS file number (find it by searching at bizfileonline.sos.ca.gov)
• The dissolution method (unanimous written consent, member vote, or court order)
• Signature of an authorized person — all managers (if manager-managed) or all members (if member-managed)

How to file: Go to bizfileonline.sos.ca.gov and file online (recommended) or mail a paper form to: California Secretary of State, Business Programs Division, 1500 11th Street, Sacramento, CA 95814.

Fee: $0. California charges no filing fee for LLC-3.

Processing time: Online filings are typically processed within 5–7 business days. The SOS will email you a stamped confirmation. Do not file LLC-4/7 until LLC-3 is confirmed — they must appear in sequence in the state records.

Step 5: File LLC-4/7 (Certificate of Cancellation) — Final Step

After LLC-3 is confirmed by the SOS, you file Form LLC-4/7: Certificate of Cancellation. This is the form that officially ends your LLC's existence in California.

LLC-4/7 requires you to affirm that:

• All known debts and obligations have been paid or adequately provided for
• All remaining assets have been distributed to the members
• All known legal proceedings have been resolved or adequately provided for

How to file: Use the same BizFile Online portal at bizfileonline.sos.ca.gov, or mail to the same SOS address above.

Fee: $0. No filing fee for LLC-4/7 either.

Processing time: Typically 5–7 business days online. Once LLC-4/7 is filed and the SOS confirms, your California LLC is officially cancelled and will no longer appear as active in state records.

After you receive the LLC-4/7 confirmation, close any remaining business bank accounts and store all business records (especially tax returns and financial records) for at least 7 years.

The $800 Minimum Franchise Tax: What You Owe in Your Final Year

Here's what trips up most California LLC owners: the $800 annual minimum franchise tax doesn't stop just because you've decided to dissolve.

The $800 is owed for every year your LLC is registered in California — including the year of dissolution. It's due by the 15th day of the 4th month of the taxable year (April 15 for calendar-year LLCs). Even if your LLC earned zero revenue and you're dissolving mid-year, the $800 is typically still owed.

Two narrow exceptions to know about:

• First-year exception (15-day rule): LLCs organized in the final 15 days of a tax year that didn't transact business during that period may not owe the $800 for that stub year. This rarely applies at dissolution time.
• First-year/first-dissolution overlap: If your LLC was both formed and fully dissolved in its very first year and never conducted any business, you may qualify for an exemption. Consult a CPA — the criteria are strict.

For most practical purposes: budget $800 for your final year and pay it with your final Form 568. This is by far the most common situation.

California LLC Dissolution vs. Texas & Florida — At a Glance

Frequently Asked Questions

Bottom Line — Your California LLC Dissolution Checklist

If you've decided to close your California LLC, here's your full action list in the correct order:

1. ☐ Hold a member vote and document the dissolution decision in writing (this week)
2. ☐ Pay all outstanding debts and send written notice to known creditors (allow 90+ days for claims)
3. ☐ Cancel licenses and accounts — EDD (payroll), CDTFA (sales tax), city/county business license
4. ☐ File Form 568 final return with the FTB — check the "Final Return" box
5. ☐ File LLC-3 at bizfileonline.sos.ca.gov (free — allow 5–7 business days)
6. ☐ File LLC-4/7 after LLC-3 is confirmed (free — allow 5–7 business days)
7. ☐ Distribute remaining assets to members after all debts and taxes are cleared
8. ☐ Close business bank accounts and retain all tax and business records for 7+ years

The most common mistake: filing with the SOS but forgetting to close out with the FTB by checking "Final Return" on Form 568. That one checkbox is what stops the $800 notices. File it, keep your LLC-4/7 confirmation, and you're done.

This article is for general informational purposes only and is not legal, tax, or financial advice. California LLC dissolution procedures, FTB requirements, and filing fees may change — verify current information with the California Secretary of State, the Franchise Tax Board, and a licensed attorney or CPA before filing. Information is current as of May 2026.