Pahna Media – California
California’s 2026–27 state budget reduces the first-year annual tax for newly established limited liability companies, limited partnerships and limited liability partnerships.
Under the enacted budget, the annual tax for these businesses will be reduced from $800 to $400 for tax years 2027, 2028 and 2029.
The measure is expected to reduce startup costs for entrepreneurs and small-business owners.
The California Senate’s budget summary estimates that the reduction will result in an annual General Fund revenue loss of approximately $100 million.
The measure applies to the first taxable year of qualifying new businesses.
Source: California State Senate – 2026–27 Enacted Budget
