Business entities: minimum franchise tax: annual tax: exemption.

Existing law imposes an annual minimum franchise tax, except as provided, on every corporation incorporated in this state, qualified to transact intrastate business in this state, or doing business in this state. Existing law exempts a corporation that incorporates or qualifies to do business in this state from the payment of the minimum franchise tax in its first taxable year. Existing law imposes an annual tax in an amount equal to the minimum franchise tax on every limited partnership, limited liability company, and limited liability partnership doing business in this state. In addition, existing law requires every limited partnership that has filed a certificate with the Secretary of State and every foreign limited partnership that has registered with the Secretary of State, every limited liability company if the articles of organization have been accepted by, or a certificate of registration has been issued by, the Secretary of State, and every registered limited liability partnership and every foreign limited liability partnership that has registered with the Secretary of State, to pay an annual tax in an amount equal to the minimum franchise tax. This bill would additionally exempt a corporation that incorporates or qualifies to do business in this state on or after January 1, 2015, from paying the minimum franchise tax for its second taxable year. The bill would, for each taxable year beginning on or after January 1, 2015, exempt those limited partnerships, limited liability companies, and limited liability partnerships from paying the annual tax for its first and second taxable year. This bill would take effect immediately as a tax levy.