Cross-border and Amazon sellers
A U.S. warehouse near the ports, the $800 tax, sales tax in many states, a foreign owner’s Form 5472.
Formation, monthly books, California and multi-state filings, and the annual returns.
About this serviceContact / City guides / Los Angeles
City guides · California
Los Angeles: the city, its taxes and forming a company, on one page
America’s gateway to Asia — the busiest container port in the Western Hemisphere, the capital of film and entertainment, and the San Gabriel Valley, the largest suburban Chinese community in the country. California taxes are high, but this is the biggest market in the U.S. and where most trade with Asia lands. YCL has long served families, sellers, business owners and overseas companies across LA and the San Gabriel Valley — we work alongside local professionals, and local small businesses can start with one service on us.
YCL’s CPAs are licensed in multiple states. Many families and businesses in Los Angeles and the San Gabriel Valley have trusted us with their taxes year after year — they build their lives here, and we walk with them, in English or Chinese, entirely online.
Local business sign-upOne free service: tax review · financial statements · rental books Personal taxesIncome tax 1%–13.3% · capital gains as income · no estate tax Business taxes$800 minimum tax · corporations 8.84% · LA city business tax Forming & keeping a companyLLC $70 · Statement of Information $20 · about 5 days online Become a referral partnerInsurance · real estate · lending · law — referrals both ways What YCL can do for youFamily returns · business tax and books · cross-border · planning City and industriesPort of LA · UCLA · USC · 475,000 Chinese in LA County Common questionsA Chinese-speaking CPA? Form in Delaware instead?
Part 1 · Local businesses and partners
Local businesses and professionals in Los Angeles: sign up
Our clients buy homes, open shops and run companies in Los Angeles, and they need reliable local professionals and businesses. Sign up so we know you and what you do — and choose one of three free services as a welcome.
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Los Angeles · Sign up
Part 2 · Taxes and companies
Taxes in Los Angeles and California
Personal taxes
California has the highest top income tax rate in the country, and it taxes capital gains as ordinary income. What it does not have is an estate or inheritance tax.
Income tax1% to 12.3% in nine brackets, plus 1% on taxable income above $1 million (13.3% at the top).For 2025 the 9.3% rate starts at $72,724 for a single filer ($145,448 married filing jointly).
Capital gainsTaxed as ordinary income — there is no lower rate for long-term gains.Selling stock or a rental property can move you into the top brackets for one year; timing and installment sales matter.
Sales taxCity of Los Angeles 10.25% (since October 1, 2026); Pasadena, Arcadia, Alhambra, San Gabriel, Monterey Park and Long Beach 11%; Irvine 7.75%.The rate depends on the exact address; the state’s own lookup governs.
Payroll deduction (SDI)State disability insurance 1.3% of all wages in 2026 — there is no wage cap.Rises to 1.4% in 2027.
Property taxProposition 13: 1% of assessed value plus voter-approved local levies; the assessed value can rise at most 2% a year until the property changes hands.Long-held homes can carry a tax far below market value — a reason to plan transfers to children carefully.
Estate taxNone in California. The federal estate tax still applies above $15 million — and to non-U.S. persons above only $60,000 of U.S. assets.
Business taxes
California’s business taxes start with a floor: almost every company registered here owes $800 a year whether or not it earns anything.
LLC annual tax and fee$800 a year from the first year, due by the 15th day of the 4th month after formation. With California income of $250,000 or more, an LLC fee of $900 to $11,790 on top.The first-year exemption only covered 2021–2023.
CorporationsFranchise tax 8.84% of net income, $800 minimum; S corporations 1.5%, $800 minimum.New corporations do not owe the $800 minimum in their first year.
Pass-through entity taxS corporations and partnerships can elect to pay 9.3% at the entity level through 2030, turning the owners’ state tax into a federal deduction.The June 15 prepayment is the greater of $1,000 or half of last year’s PTE tax.
Sales tax registrationA seller’s permit from the CDTFA is free and required to sell goods. Out-of-state sellers register once California sales pass $500,000 a year.
Payroll costsMinimum wage $16.90 statewide and $18.42 in the City of LA (from July 1, 2026); fast-food $20; unemployment insurance 3.4% for new employers on the first $7,000.California employers have also paid extra federal unemployment tax in recent years because of the state’s federal loan.
On top of that: the City of Los Angeles
Every business in the City of LA — including a home-based one — registers for the city business tax. Each of the 88 cities in the county has its own rules, so a company in Arcadia or Santa Monica is handled differently.
Business tax ratesPer $1,000 of gross receipts: retail $1.27, wholesale $1.01, professions $4.25, other services $3.56, rentals $1.27.
Small business exemptionNo tax with worldwide gross receipts of $100,000 or less; creative artists are exempt on up to $300,000.Only if the business is registered and files its renewal on time, by the last day of February.
Mansion tax (Measure ULA)On sales in the City of LA: 4% above $5.4 million and 5.5% above $10.9 million, on top of the city’s 0.45% transfer tax.Thresholds for sales from July 1, 2026; they are adjusted every year. Applies to commercial property too.
Forming and keeping a company
A company is formed with the Secretary of State, then registers with the Franchise Tax Board (taxes), the CDTFA (sales tax), the EDD (payroll) and the city. California has no general state business license — licenses come from the city or county.
LLC or corporation filingLLC $70; corporation $100. Online about 5 days; 24-hour expedite $350, same-day $750.
Statement of InformationWithin 90 days of formation, then LLCs every two years ($20) and corporations every year ($25).Missing it brings a $250 penalty and eventually suspension.
The $800 taxEvery year, separately, to the Franchise Tax Board — the Statement of Information does not cover it.Unpaid tax leads to FTB suspension; reviving a suspended company means filing every missing return.
Registered agentRequired, with a California street address. Commercial agents usually charge about $100 to $300 a year.
Out-of-state companyForeign LLC $70, foreign corporation $100 — and the $800 a year applies to it as well.A Delaware or Wyoming company doing business in California pays both states.
Closing earlyAn LLC cancelled within 12 months with the short form can avoid the first $800.
Why form a company here
- The largest consumer market in the U.S. — customers, distributors and buyers are here.
- The ports, warehouses, customs brokers and freight forwarders that cross-border trade needs, all within an hour.
- A deep bilingual community of suppliers, landlords, lawyers and lenders who already work with Chinese-owned businesses.
- Venture capital, entertainment money and a steady flow of graduates from UCLA, USC and Caltech.
What to watch
- $800 a year is owed even with no income, from the first year for LLCs — budget for it before you form.
- Forming in Delaware or Wyoming does not avoid California if you operate here; you would pay both.
- Four state agencies plus the city — miss one registration and penalties follow.
- Employees bring California’s strict wage-and-hour rules; payroll should be set up properly from day one.
Part 3 · YCL and this city
What YCL does for clients in Los Angeles
Everything online: upload documents in the client portal, sign electronically, pay online — in English or Chinese; the important conversations happen face to face on video.
The situations we see most
San Gabriel Valley families
Rental properties, parents and accounts in China or Taiwan, gifts from abroad, a home bought decades ago.
Family returns, rental schedules and depreciation, FBAR and Form 3520, and planning for the next generation.
About this serviceNew immigrants and returning families
What to do before becoming a U.S. tax resident; companies and property left in China.
Pre-arrival planning, the first-year return, Forms 5471 and 8621.
About this serviceRestaurants, clinics and local shops
Sales tax returns, the city business tax renewal, payroll under LA’s minimum wage, books that are months behind.
Bookkeeping, payroll, state and city filings and the annual return, as one monthly service.
About this serviceCreators and entertainment freelancers
1099s from many clients, income from shoots in other states, whether a loan-out company or S corporation pays.
Multi-state returns, entity choice with the $800 tax in the numbers, quarterly estimates.
About this serviceOverseas companies opening a U.S. office
Subsidiary or branch, California nexus, the first employee, pricing between parent and subsidiary.
Entity set-up, state and city registrations, payroll, Forms 5472 and 1120 every year.
About this servicePart 4 · The city
From a Spanish pueblo to the Pacific capital
Los Angeles had no natural harbor and little water. It built both — a breakwater and port, then an aqueduct 230 miles long — and on top of them came railroads, oil, film, aircraft and, today, the trade that links America with Asia.
The city in U.S. history
- 1781Forty-four settlers from eleven families found the pueblo of Los Angeles.
- 1850Los Angeles is incorporated as a city; California becomes the 31st state the same year.
- 1876The railroad from San Francisco arrives; the line east follows in the 1880s and a land boom begins.
- 1892Edward Doheny strikes oil near downtown; Southern California becomes a major oil region.
- 1907The Port of Los Angeles is founded at San Pedro; in 1913 the Los Angeles Aqueduct opens.
- 1911The first film studio opens in Hollywood; within a decade the American film industry has moved west.
- 1940sAbout one-third of America’s warplanes are built here; aerospace shapes the region for decades.
- 2028After 1932 and 1984, Los Angeles hosts the Olympic Games for the third time; World Cup matches were played here in 2026.
The largest county economy in America
Los Angeles County alone produced about $1 trillion in 2024 — more than most countries. Two ports side by side handle close to a third of America’s container trade, and most of it is with Asia.
$1.0TLA County GDP, 2024
31%U.S. container trade through the ports of LA and Long Beach
8Fortune 500 headquarters in LA County (2026)
73.7MLAX passengers in 2025
Leading industries and employers
Ports, trade and logistics
The Port of Los Angeles has been the busiest container port in the Western Hemisphere for 26 years; China and Hong Kong are its largest trading partner. Warehouses stretch from the South Bay to the Inland Empire.
Port of Los Angeles · Port of Long Beach
Film, music and entertainment
Studios, streaming, live events and the creators who work for them — a world of 1099s, loan-out companies and income from many states.
Disney · Live Nation · Endeavor
Consumer brands and e-commerce
Apparel, footwear, toys and beauty brands design and sell from here, and many cross-border sellers keep their U.S. warehouse near the ports.
Skechers · Pop Mart · TikTok Shop sellers
Aerospace and research
From wartime aircraft plants to today’s space and defense firms in the South Bay, anchored by NASA’s Jet Propulsion Laboratory, run by Caltech.
NASA JPL · Caltech
Health care and insurance
Large health plans, hospital systems and clinics — and one of the country’s highest health-care minimum wages.
Molina Healthcare · Farmers Insurance
Energy and real estate
One of the largest utilities in the U.S. and one of its largest property markets, from San Gabriel Valley homes to warehouses and shopping centers.
Edison International · A-Mark
Universities and talent
California hosts more international students than any other state, and more than a third of them come from China. Many stay to work, marry and start companies here.
- UCLA — about 47,400 students, the largest University of California campus; about 10,800 international students
- USC — about 46,000 students; about 12,000 international students, some 5,800 of them from China (fall 2025)
- Caltech — about 2,400 students, 48 Nobel laureates, and the manager of NASA’s Jet Propulsion Laboratory
- Cal State LA · LMU · ArtCenter — public, private and design schools that feed local business, entertainment and design
Overseas companies here
Foreign-owned companies employ about 230,000 people in Los Angeles County (California FDI Report 2026). Japan is the largest investor by far; China and Hong Kong are the ports’ largest trading partner.
- American Honda — the Japanese automaker’s U.S. headquarters, in Torrance
- TikTok — U.S. offices in Culver City
- Pop Mart — the Chinese toy brand leased a Culver City headquarters in 2026
- Cross-border sellers — thousands of Chinese brands and sellers run U.S. warehouses and companies near the ports
For a company from abroad, California has a catch: once a company is registered or doing business here it owes at least $800 a year, even with no income. Add an EIN, a seller’s permit, payroll accounts, the city business tax registration and, every year, Form 5472 and transfer pricing between parent and subsidiary.
The Chinese and immigrant community
Chinese immigrants came to Los Angeles in the 1850s. In October 1871 a mob killed about eighteen Chinese residents — one of the worst mass lynchings in American history. Old Chinatown was later torn down to build Union Station, and in 1938 the community built the New Chinatown that stands today.
From the 1980s, families from Taiwan, Hong Kong and mainland China settled in Monterey Park — called the first suburban Chinatown — and by 1990 it was the first Asian-majority city in the continental U.S. The community spread across the San Gabriel Valley to Arcadia, San Gabriel, Rowland Heights and Walnut, and in 2009 Judy Chu became the first Chinese American woman elected to Congress. For tax purposes that means rental properties, family businesses, parents and accounts across the Pacific, and gifts and inheritances from abroad.
475,000people of Chinese origin in LA County (ACS 2020–2024)
64.8%of Monterey Park residents are Asian
42.4%of Arcadia residents are of Chinese origin
33.4%of LA County residents were born abroad
Los Angeles · Common questions
Is there a Chinese-speaking CPA for clients in Los Angeles?
Yes. YCL is a bilingual (English and Mandarin) CPA firm licensed in multiple states. We serve Los Angeles, San Gabriel Valley and Orange County clients online: documents go through a secure client portal, returns are signed electronically, and meetings are by video.
Do I really have to pay $800 a year for a California LLC with no income?
Yes. Every LLC registered or doing business in California owes the $800 annual tax every year, starting with the first year, until it is properly cancelled. Corporations owe the same minimum but are exempt in their first year. An LLC cancelled within 12 months using the short-form cancellation can avoid the first $800.
What is the sales tax in Los Angeles?
10.25% in the City of Los Angeles since October 1, 2026. Many nearby cities are higher — Pasadena, Arcadia, Alhambra, San Gabriel, Monterey Park and Long Beach are 11% — while Irvine in Orange County is 7.75%. The rate depends on the exact address.
Does California tax capital gains differently?
No. California taxes all capital gains as ordinary income, at rates up to 13.3%. Selling a rental property or a large block of stock can push one year’s income into the top brackets, so timing, installment sales and 1031 exchanges are worth discussing before the sale.
Do I need a Los Angeles business license?
Every business operating in the City of Los Angeles, including a home-based one, must register for the city business tax and hold a Business Tax Registration Certificate. Businesses with $100,000 or less in gross receipts owe no tax, but only if they are registered and renew on time by the end of February. Other cities in the county have their own rules.
I live in Los Angeles. Should I form my company in Delaware or Wyoming?
Usually not. A company run from California is doing business in California, so it must register here and pay the $800 tax anyway; forming elsewhere just adds a second state’s fees and filings. Delaware still makes sense when investors require it.
Does my CPA have to be in Los Angeles?
No. Federal returns are the same in every state, and YCL’s CPAs are licensed in multiple states. We prepare California individual and business returns, sales tax returns and LA city business tax filings, and everything — documents, signatures, payment, meetings — is handled online.
How do local businesses in Los Angeles work with YCL?
Sign up on this page. Local businesses receive one free service of their choice — a tax-saving review, a set of monthly financial statements, or a rental-property clean-up — and insurance, real estate, lending and legal professionals can become referral partners.
Figures checked on 2026-11-10. Tax rates and government fees change; the government’s own publications govern. This page is general information, not tax or legal advice for your situation.
In Los Angeles? We can still handle your taxes
Start with a free 15-minute call about your situation; if we are a fit, a written quote follows.