What California Form FTB 3536 (2020) Is For
California Form FTB 3536 is the payment voucher LLCs use to submit the estimated LLC fee during the tax year. This fee applies only to LLCs with total California income of $250,000 or more, and the form’s sole purpose is to transmit that mid-year estimated payment to the Franchise Tax Board (FTB).
This fee is separate from the $800 annual LLC tax paid with Form FTB 3522. While the annual tax applies to all LLCs, the LLC fee is income-based and uses the following 2020 tiers:
- $250,000–$499,999: $900
- $500,000–$999,999: $2,500
- $1,000,000–$4,999,999: $6,000
- $5,000,000 or more: $11,790
Form 3536 is due by the 15th day of the 6th month of the LLC's taxable year—June 15, 2020, for calendar-year filers. If your income stays below $250,000, you do not file Form 3536.
When You’d Use California Form FTB 3536 (2020)
You use Form 3536 when your LLC expects income of at least $250,000 for the year and must make its estimated fee payment by the June 15 deadline. Fiscal year filers follow the same rule using the 15th day of the 6th month.
Because Form 3536 is strictly a payment voucher, there is no “amended” version. If you underpay or miss the deadline, you simply submit the voucher later with payment. However, late payments may trigger the 10% underpayment penalty.
You also use Form 3536 again when filing your 2020 Form 568 to pay any remaining LLC fee. LLCs with a short year ending before the 15th day of the 6th month do not make estimated payments; they pay the entire LLC fee with Form 568.
Key Rules or Details for the 2020 Tax Year
Income Threshold Determines Filing
Only LLCs with total California income of $250,000 or more need to submit Form 3536. “Total income” means income before deductions and includes business receipts, rental income, portfolio income, and capital gains sourced to California.
10% Underpayment Penalty
If the estimated payment is less than the final calculated fee, the FTB charges a penalty equal to 10% of the underpaid portion. For example, if your actual fee is $6,000 and you paid only $900 by June 15, the underpayment is $5,100, and the penalty is $510.
Safe Harbor Rule
There is no penalty if your June 15 payment equals or exceeds your prior-year LLC fee. For example, if you paid $2,500 in 2019, paying at least $2,500 by June 15, 2020 prevents penalties—regardless of your 2020 income.
Not for the Annual LLC Tax
Form 3536 should never be used for the $800 annual tax. That payment uses Form FTB 3522, due by the 15th day of the 4th month (April 15 for calendar-year filers).
Payment Options
You can pay by:
- Mailed check with Form 3536
- Web Pay for Businesses
- Credit card via officialpayments.com
- Electronic withdrawal through tax software
If paying electronically, do not also mail Form 3536.
Series LLCs
Each series within a series LLC is treated as a separate entity. Each series must file its own Form 3536 and calculate the fee based on its own California income.
Step-by-Step (High Level)
Step 1: Determine Whether the Fee Applies
Estimate your total California income for 2020. If it's below $250,000, no estimated fee is required. If you’re close to the threshold, consider making a cautious payment to avoid penalties if income rises unexpectedly.
Step 2: Estimate Your Total California Income
Use Schedule IW (LLC Income Worksheet) as your guide. Include all California-source receipts and portfolio income before deductions.
Step 3: Select the Fee Tier
Apply the income tiers to determine the estimated fee amount:
- $900
- $2,500
- $6,000
- $11,790
Step 4: Consider Safe Harbor
Review your 2019 LLC fee. To eliminate penalty risk, pay at least that amount by June 15 even if your 2020 estimated fee is lower.
Step 5: Complete Form 3536
Enter:
- LLC name
- California SOS file number
- FEIN
- Address
- Payment amount
- Tax year dates
Make sure IDs are accurate so payments post properly.
Step 6: Submit Your Payment
Mail the voucher and check, or use one of the approved electronic payment options. Ensure payment is submitted or postmarked by June 15, 2020.
Step 7: Retain Records
Keep a copy of Form 3536 and proof of payment. You’ll need this information when preparing your 2020 Form 568 to apply your estimated payment credit.
Common Mistakes and How to Avoid Them
- Confusing the LLC fee with the $800 annual tax
Use Form 3536 only for the LLC fee; use Form 3522 for the annual tax. - Using net income instead of total income
Calculate income before deductions using Schedule IW. - Missing the safe harbor opportunity
Paying at least your 2019 fee protects you from penalties even if your 2020 income surges. - Failing to pay when income passes $250,000
If unexpected income pushes you over the threshold mid-year, submit a payment quickly. - Using the wrong year’s form
Always use 2020 Form 3536 for 2020 estimated fees. - Double-paying by mailing after paying electronically
Choose one payment method only. - Entering incorrect identification numbers
Verify your SOS file number and FEIN to avoid misapplied payments. - Not keeping proof of payment
You will need accurate records when filing Form 568.
What Happens After You File
Once submitted, the FTB processes your Form 3536 payment and credits it to your LLC’s account. The payment remains as a credit until you file Form 568.
When filing the 2020 Form 568 (due March 15, 2021 for calendar-year LLCs), you:
- Report your actual LLC fee
- Apply your estimated payment credit
- Pay any remaining balance (using another Form 3536)
Depending on the final fee calculation, you may owe:
- A remaining balance
- A refund
- Penalties and interest for underpayment
The FTB may also issue notices if discrepancies arise when reviewing your Form 568. Keep Form 3536 records for at least four years along with your 2020 tax documents.
FAQs
Do we need to file Form 3536 if our income is under $250,000?
No. The estimated fee applies only when total California income is $250,000 or more.
How does safe harbor work?
If your June 15 payment equals or exceeds your prior-year LLC fee, you avoid the 10% underpayment penalty—even if your actual 2020 fee is higher.
Can we pay electronically instead of mailing the form?
Yes. Web Pay, credit card payments, and software-based EFW all satisfy the requirement. Do not mail the voucher if you pay electronically.
What happens if we miss the June 15 deadline?
Pay as soon as possible. You may owe the 10% penalty and interest, but paying quickly reduces additional charges.
Does a newly formed LLC in 2020 owe the fee?
Yes. For 2020, first-year LLCs owe both the $800 annual tax and, if applicable, the LLC fee.
How do we handle Form 3536 for a series LLC?
Each series must prepare its own Form 3536 and pay its own LLC fee separately.
For official forms and instructions, visit: https://www.ftb.ca.gov/forms/2020/2020-3536.pdf
