Converting an LLC to a Corporation or Vice Versa in California

Hi, I’m attorney Elizabeth Potts Weinstein. Today, we're going to discuss how to convert an LLC to a corporation or a corporation to an LLC. This guide focuses on changing the legal entity of your business within the same state, not on relocating or altering tax status. Understanding the Basics This conversion process does not involve changing the tax status of your business. For example, an LLC can be taxed as a sole proprietorship, partnership, S corporation, or C corporation. Similarly, a corporation can be taxed as an S corporation or C corporation. The focus here is on changing the legal structure of your business entity while remaining in the same state. Steps to Convert Your Business Entity 1. Review Tax Implications Before starting the conversion process, consult with your tax advisor or accountant. The tax implications can significantly impact your decision and timing. For instance, an LLC taxed as a sole proprietorship cannot maintain that status when converte...