Legal Question in Business Law in California

Well the first question is whether you need an LLC at all. Will your business expose you to personal liability that you can't cover by good business practices and/or insurance? Will you have investors and/or co-founders of the business and need to set up an ownership and management structure that allows for ownership in shares that can be transferred in the future? Or is it just going to be you doing business as a sole owner? You can't just set up an LLC and forget it. Although it's easier than maintaining a corporation, there still is work and costs involved in operating as an LLC that you don't have if you just operate as a sole proprietor, or even a simple general partnership if you have more than one owner.

Then, even if it would make sense to form an LLC you need to look at how you will operate. There's a lot of misleading information going around about how advantageous it is to form your corporation or LLC in Nevada. The problem is that if you do that, but your physical operations are in California, even if that is nothing more than a PC in your kitchen for internet sales, you are breaking the law if you don't register your NV LLC or corporation as a foreign business entity operating in California. And guess what. The cost of that registration is the same as if you just form the company in California in the first place.

Bottom line: First make really sure you have any reason for forming an LLC at all. Second, if you do, and your actual place of business will be in California, don't waste your time and money forming in any other state, because you will just have to register in CA anyway.