Every California corporation and LLC should use the end of the year to confirm three things: its Statement of Information is current, its minutes and consents reflect the decisions made this year, and its governing documents still match how the business runs. These tasks take hours, not weeks. Skipping them can cost a $250 penalty, a suspended entity, or a weaker liability shield when it matters most.
Most business owners think of corporate compliance as paperwork. It is better understood as evidence. Your minutes, filings and records are proof that your company is a separate legal entity that is compliance with the law.
Even if your documents are not yet due, it is important to have an idea of when it is due next and to ensure everything is up to date. January brings tax season and new laws, which leave little room for cleanup.
1. Don’t Let a $25 Filing Become a $275 Problem
The Statement of Information is the public record of who runs your company and where it can be reached. While it is a short form, and it is easy to forget.
Here is what California requires:
| Entity | How often | State fee | Late penalty |
|---|---|---|---|
| Corporation (Form SI-550) | Every year | $25 | $250 |
| LLC (Form LLC-12) | Every two years | $20 | $250 |
Corporations file under California Corporations Code 1502, and LLCs under Section 17702.09. Your filing window opens five months before the end of the month your company was formed. A corporation formed in March, for example, can file any time from October through March.
The penalty is the smaller risk. If the filing stays delinquent, the Secretary of State can suspend your company. A suspended company loses its powers, rights, and privileges until it is revived. Reviving it takes time and money you would rather spend elsewhere.
Don’t wait for the window if something changes. Update your Statement of Information whenever any of these change:
- Officers, directors or managers
- The agent for service of process
- The principal office or mailing address
- The type of business
2. Put This Year’s Decisions in Writing
California corporations must keep minutes of shareholder, board and committee proceedings under Corporations Code Section 1500. They must also hold an annual shareholders’ meeting to elect directors under Corporations Code Section 600(b). Many small corporations meet these requirements with written consents instead of live meetings, which is fine if the consents are done correctly:
- Board actions by written consent require the consent of every director (Corporations Code Section 307(b)).
- Director elections by shareholder written consent generally must be unanimous (Corporations Code Section 603(d)).
A consent signed by most, but not all, of the required people may not be valid. That gap often surfaces years later, during due diligence for a sale or a dispute between owners.
Start with a simple year in review. Look back at 2026 and confirm each of these was approved in writing:
- Electing or re-electing directors and appointing officers
- Issuing, transferring or redeeming shares or membership interests
- Approving year-end bonuses, distributions or dividends
- Signing a significant lease, loan, line of credit or acquisition
- Changes to your bylaws or an operating agreement
If you have an LLC. California law does not require annual meetings. Skipping meetings is not, on its own, a reason to disregard your liability protection, unless the operating agreement requires meetings (Corporations Code Section 17703.04(b)). That “unless” is important since many template operating agreements require annual meetings that are never held. Double check your agreement to see whether you need to hold an annual meeting or not.
3. Make Sure Your Records Match Reality
Businesses change faster than their paperwork. California LLCs must keep specific records at their principal office, including a current list of members and managers, the operating agreement and its amendments, and the last six years of tax returns and financial statements (Corporations Code Section 17701.13). Corporations should keep a current share ledger alongside their bylaws and minute book.
Ask yourself these three questions:
- Who owns the company today? Your share ledger or membership schedule should reflect every issuance, transfer, buyout, and equity grant from this year.
- Who can sign for the company? Your records, your bank’s signature cards, and your Statement of Information should all name the same people.
- Do your bylaws or operating agreement still fit? A document written for two founders may not work for a company with five owners.
Template documents deserve a close look. An online-template operating agreement may have default voting rules, capital call provisions or buyout formulas that no one read closely. Those terms govern anyway. Disputes between owners often turn on language that nobody remembers agreeing to.
Practice Tip: If your governing documents and your actual practice do not match, fix the document or change the practice. A mismatch hands an opposing party an argument.
Key Takeaways
- California corporations file a Statement of Information every year; LLCs file every two years. Late filings carry a $250 penalty and can lead to suspension.
- Corporations must keep minutes and hold an annual meeting, or act by valid written consent.
- Written consents for board actions and director elections generally must be unanimous.
- Your records and governing documents should match how your company operates today.
- U.S. companies no longer file federal beneficial ownership reports, but California filings still apply.
Let BMBR Handle Your Year-End Review
A few hours of housekeeping in Q4 can help protect your liability shield and help get your company in compliance. BMBR’s attorneys provide partner-level attention to corporate governance for California businesses, from minute book cleanups to operating agreement updates. Contact our North San Diego County office to schedule a year-end governance review.
This post is for informational purposes only and does not constitute legal advice. For advice on your specific situation, consult a qualified attorney.
FAQs
How often does a California Corporation file a Statement of Information? Every year. A California Corporation should file an update whenever officers, addresses, or agent change.
How often does a California LLC file a Statement of Information? Every two years. A California LLC should file an update whenever managers, addresses, or agent change.
What happens if I file my Statement of Information late? The Secretary of State can assess a $250 penalty. Continued delinquency can lead to suspension of the entity.
Does a small California Corporation really need an annual meeting? Yes. Corporations Code Section 600(b) requires an annual shareholders’ meeting to elect directors. Many small corporations satisfy this with an unanimous written consent instead.
Do California LLCs need to keep minutes? California law does not require LLC meetings or minutes, unless the operating agreement requires them. Documenting major decisions in writing is still good practice.