
“Note that the FTB’s determination of when an out-of-state LLC must file tax returns is in contrast with the California Corporations Code. Under the California Corporations Code, any entity that ‘actively engages in any transaction in California for the purpose of financial gain or profit’ must register with the Secretary of State. But an out-of-state corporation is not considered to be transacting business in California merely because it is a member or a manager of a domestic or out-of-state LLC [..]. Moreover, the new California Revised Uniform Limited Liability Company Act of January 1, 2014 provides that an out-of-state LLC ‘may’ register in California and does not impose penalties for failing to do so.”
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