Minimum franchise tax: annual tax: exemption: veteran-owned small businesses.

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 liability company doing business in this state. In addition, existing law requires 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 to pay an annual tax in an amount equal to the minimum franchise tax. This bill, for taxable years beginning on or after January 1, 2016, would additionally eliminate that minimum franchise tax, in the 2nd and 3rd taxable years, for a corporation that is a new veteran-owned small business, and that annual tax, in the first 3 taxable years, for a limited liability company that is a new veteran-owned small business, as defined. This bill would take effect immediately as a tax levy.