What is the minimum franchise tax that Apricot Lane pays in California?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
e fee for additional stores for an existing franchisee is $20,000.
Income Taxes
The Company has elected to be taxed as an S corporation for federal income tax and California franchise tax purposes. As a result, the Company does not pay federal corporate tax on its income; instead, the stockholders pay tax on their respective shares of such income. California has adopted similar provisions, except that there is
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, the company has elected to be taxed as an S corporation for federal income tax and California franchise tax purposes. Because of this election, Apricot Lane itself does not pay federal corporate tax on its income. Instead, the stockholders pay tax on their respective shares of such income.
California has adopted similar provisions for S corporations, but there are some differences. Specifically, California assesses a 1.5% franchise tax on California taxable income. In addition to this percentage-based tax, California also imposes a minimum franchise tax.
The minimum franchise tax that Apricot Lane pays in California is $800. This means that even if the 1.5% franchise tax on taxable income is less than $800, Apricot Lane must still pay at least $800 in franchise tax to the state of California.