Increasing Delays in California Corporation Filing Processing Times Drive Clients to Delaware

Due to the pandemic, California has reduced staff in the Secretary of State corporate unit, resulting in delays in non-online filing processing times. While Articles of Organization (for a LLC) are filed online, Articles of Incorporation (for a corporation) are not eligible for online filing.

The current processing time for online filing submissions is about 5 days, while non-online filing submissions is about 1 month. To deal with the delays, California has temporarily eliminated all expedited filing options, leaving many filers with no options and in limbo while they wait.

Any filer that is in need of fast turnaround should consider forming a corporation in Delaware and then qualifying in California. Delaware’s routine processing is still only 2-3 days so filers can form their corporation, get their tax ID number, and start doing business while the California registration is pending with the California Secretary of State.

While forming in Delaware does add some additional annual fees, it will allow filers to have a corporation up and running a month before they would if filing in California only.

Updated April 21, 2020