LLC and corporation records book in California

Many contractors form their LLC or corporation, receive the papers from the State, and put them in a drawer. Months later, the bank, a big client, an insurer, or an attorney asks for the company agreement, the minutes, or the list of owners, and nobody knows where they are.

That binder is called a corporate record book (in English, "minute book"). This guide explains, with job examples, which documents an LLC and a corporation in California keep, what each one is for, and how often it is updated.

On our contractor protection page we already published a short list of what a standard record book contains. We do not repeat it here. Instead, we explain the why and the points that confuse people most, like the EIN and the contractor license.

In short

• The corporate record book is the file that shows your company exists, who runs it, and what decisions it made.
• An LLC and a corporation do not keep exactly the same documents: the LLC revolves around the operating agreement, and the corporation around the bylaws, minutes, and stock register.
• The EIN is not required for every LLC: it depends on whether there are employees, more than one member, special taxes, or whether the bank asks for it.
• Not having a corporate book does not automatically erase limited liability, but it leaves you without proof and can weigh against you in court, especially for a corporation.
• For the contractor license (CSLB), the LLC has its own rules for qualifier, bonds, and insurance.

What is a corporate record book and what is it for?

Think of a job file: contract, permits, change orders, and payments. The corporate book is the same thing, but for your company.

It serves three very specific purposes:

• Opening accounts and getting credit. Banks and lenders usually ask for the formation documents and who is authorized to sign.
• Proving who is in charge. If partners disagree, the operating agreement or bylaws say how the decision is made.
• Leave evidence for a lawsuit, an audit, or the sale of the business. A buyer or a judge will want to see that the company was run as a separate entity.

California law requires certain entities to keep records. Corporations must keep adequate books and records, minutes, and a shareholder register (Corporations Code §1500). LLCs must keep at their designated office, among other things, the member list, articles of organization, operating agreement, and tax returns and financial statements for the six most recent tax years (Corporations Code §17701.13).

Records book documents for an LLC in California

This is what is normally kept and why it matters. If you work with a partner or partners, the operating agreement is the most important.

Document	What it is and why it matters
Articles of Organization (Form LLC-1)	It is what you file with the Secretary of State for the LLC to exist. Keep the stamped copy: the bank and the CSLB ask for it.
Operating Agreement	It says who contributes how much money, who decides, how profits are split, and what happens if a partner leaves. A single-owner LLC should also have it in writing.
Member register	List of the owners with their contributions and percentages. It avoids arguments like "I put in the truck, how much is that worth?"
Statements of Information (Form LLC-12)	Copy of each filing that updates the LLC's address and manager with the State.
Consents and minutes	A written record of big decisions: a loan, buying a truck, signing an important contract, or changing managers.
Tax returns and financial statements	Copies of federal and state returns. LLC law requires keeping those for the six most recent years.

Example: two brothers have a remodeling LLC and one wants out. Without an operating agreement, each remembers the deal his own way. With the agreement, it is already written how his share is valued.

Corporate book documents for a corporation (S-Corp or C-Corp)

A corporation has more formalities. Use these documents:

• Articles of Incorporation. The formation document, with the State's seal.
• Bylaws. The internal rules: when meetings are held, who is a director and officer, how voting works.
• Organizational minutes. Appoint directors and officers, adopt the bylaws, and authorize issuing stock and opening the bank account.
• Shareholder register and stock certificates. Who owns how many shares. The law requires this record (§1500).
• Minutes of shareholder and board of directors meetings. An annual meeting and important decisions, or their written consents.
• Statements of Information (Form SI-550). A copy of each filing with the Secretary of State.
• Annual report to shareholders. The law requires it, but a corporation with fewer than 100 shareholders can waive it in its bylaws (§1501).
• S-Corp election (Form 2553), if it applies, with the IRS confirmation.

A single-owner corporation must also keep minutes and a stock register. Confirm with your attorney what else applies to your case.

EIN, CSLB license and insurance: what is required and what depends

Does every LLC need an EIN?

No. The EIN is your business's identification number with the IRS. According to the IRS, a single-member LLC with no employees and no excise taxes can use its owner's number.

But it does need an EIN if it has employees or special taxes. Also if the bank or a state law requires it, or if it chooses to be taxed as a corporation. An LLC with more than one member or a corporation normally needs one. Check on the IRS website or with your tax preparer.

If you have it, keep the IRS confirmation letter in the book. The EIN application is free on the IRS's official website.

Contractor License and LLC

Forming the company does not give you a license. The CSLB sets its own rules for LLCs. The most important ones are these:

• A qualifier (for example, a responsible member or manager, or an RMO or RME) must qualify the license.
• A $25,000 contractor bond and, for LLCs, an additional $100,000 bond to protect employees who are not paid (CSLB bonds).
• Liability insurance: the minimum the CSLB cites is $1 million if there are five or fewer people on the license, and it goes up with each additional person.
• Proof of workers' compensation insurance, unless you apply for the exemption for having no employees.
• The company name on your license and your contracts must match the one registered with the Secretary of State.

Amounts can change, so confirm them with the CSLB before you apply. Keep a copy of your license, bonds, and policies in the binder. You can also review the CSLB guide to verifying contractors.

What if I do not have a corporate record book, or mine is incomplete?

There is a common myth: "if I don't have my book, I lose my LLC's protection." That is not automatic.

In California, LLC members are not personally liable for the company's debts just because they are members. Also, the law says that not holding meetings of members or managers does not count as a factor for calling the LLC an "alter ego" of the owner (meaning a judge treats it as if it were the same person as you), unless the operating agreement or the articles require those meetings (Corporations Code §17703.04).

Even so, an incomplete record book brings real problems:

• You cannot show who owns what or who can sign.
• The bank, the CSLB, or a lender may ask you for documents you do not have.
• LLCs and corporations have record-keeping duties, and a corporation that neglects minutes and records gives arguments to whoever sues it.
• Mixing personal and business money does matter in a lawsuit, whether or not you keep a records book.

We cover this in more detail in our article on the legal protection of LLCs and corporations.

How to keep your books up to date

It does not need to be complicated. A digital folder with subfolders and a review date will do.

• Statement of Information: an LLC files it every two years and a corporation files it every year, plus an initial one within the first 90 days (California Secretary of State). Check the fee and your due month.
• Annual Franchise Tax Board (FTB) tax: LLCs pay an annual tax with Form 3522 (FTB information for LLCs). Corporations have their own minimum franchise tax. Confirm the current amount and due date.
• Minutes and consents: at least once a year in a corporation and whenever there is a major decision.
• Changes in partners, addresses, or licenses: update the record and keep the new document with the old one.

What to do now

1. Look now in your email and your office for the formation documents and your operating agreement or bylaws.
2. Mark which documents on the list for your type of company you are missing.
3. Ask for a copy of anything missing from the Secretary of State, the IRS, or whoever helped you form the company.
4. Create a digital folder with a backup and note the due dates of your reports.
5. Write down your important decisions from the past year in minutes or a consent.
6. Separate the company bank account from your personal expenses.

When to talk to a professional

This article is informational and is not legal or tax advice. Talk to a business attorney to draft or review the operating agreement, bylaws, and minutes, or if there is a conflict between partners or a lawsuit.

Confirm with a tax preparer, CPA, or enrolled agent whether you need an EIN and how your entity is taxed. For licenses and bonds, ask the CSLB directly.

How ODC helps you

At Oficina del Contratista, we keep your books up to date (bookkeeping) so your business records are organized and ready when someone asks for them. Learn about our bookkeeping for contractors service and how we explain the right business structure. Entity formation, legal matters, and taxes are handled by independent partners.

References

1. California Corporations Code §1500 — corporate records, minutes, and shareholder register.
2. California Corporations Code §17701.13 — records an LLC must keep.
3. California Corporations Code §17703.04 — liability of LLC members and meetings.
4. IRS: Single member limited liability companies — when a single-member LLC needs an EIN.
5. CSLB: Licenses for Limited Liability Companies — qualifier, bonds, and insurance for LLCs.
6. California FTB: Limited liability company filing information — annual tax and LLC returns.

This article is for information and education only. It is not legal, tax or bookkeeping advice. We are a bookkeeping service: for tax matters, consult a tax preparer, CPA or enrolled agent.