Find out how to form a Texas LLC for yourself
Learn about Texas LLC formation, including information on Registered Agents, naming rules, business licenses, and more.
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Creating an LLC in Texas
A limited liability company (LLC) offers many benefits to small businesses, including liability protection and tax advantages.
An Limited Liability Company LLC must be formed in Texas by filing a Certificate of Formation with the Texas Secretary of State and paying the $300 filing fee.
However, you’ll first need to choose a name and registered agent for your Texas LLC . The formation of an LLC may take up to 40 business days unless you pay an additional $25 for expedited processing (4-5 days).
An LLC can be easily formed in Texas. Simply follow these six steps, and you’re done.
Step 1. Choose a Name for Your LLC Texas
Creating an LLC in Texas requires you to choose a business name before you can file a Certificate of Formation. Be sure that your business name complies with the Texas naming requirements and can be searched by potential customers.
- Texas law requires an LLC name to contain the words “Limited Liability Company” or “Limited Company,” or the abbreviations “Ltd.,” “LLC,” or “LC.” “Limited” may be abbreviated as “Ltd.” or “LTD,” and “Company” as “Co.”
- It is not acceptable for your Texas LLC to have words associated with a government agency (FBI, Treasury, State Department, etc.).
- You should avoid using words or abbreviations that may make your LLC Texas appear to be a different type of entity, such as “LP” or “corporation”.
- There may be additional documentation and licensure paperwork required for certain restricted words (bank, lawyer, attorney, credit union, etc.).
- Check the Texas Comptroller of Public Accounts’ website to ensure the name you want is not already taken(including businesses no longer in operation)
A complete list of Texas’ naming rules can be found on the Texas Secretary of State’s website.
Check URL availability: You are likely to need a web page even if you don’t think you do. Buying your domain name now will at least give you the option of having one in the future. It’s a good idea to check the URL availability before finalizing your Texas LLC name.
When you do business in the real world, you do not have to use the official legal name of your LLC. Rather than using your actual name, you can use an assumed name, also known as "DBA" (short for doing business as), trade name, or fictitious business name. To have an assumed business name, you must file an Assumed Name Certificate ($25) with the Texas Secretary of State.
In case you are not yet ready to register your LLC but are concerned that someone might take your name, you can reserve it for a small fee($40). The Texas Secretary of State will allow you to reserve a name for 120 days by submitting a Request for Reservation or Renewal of Reservation of an Entity Name (Form 501).
An LLC stands for a Limited Liability Company. A simple business structure that is more flexible and offers many of the same benefits as a traditional corporation. For more information, see "What is a Limited Liability Company?".
LLCs do not usually require a DBA. Your LLC's name can serve as your company's brand name, and you can accept checks and other payment methods under that name. You may however choose to register a DBA if you wish to conduct business under a different name. To learn more about DBA, read our "What is a DBA" Guide.
Step 2: Appoint Your Registered Agent in Texas
Your next step in forming an LLC in Texas is to appoint a Registered Agent, an individual or company authorized to receive legal and state mail on your behalf.
All Texas LLCs must have a registered agent. Please include your registered agent’s name and address on your Certificate of Formation.
Registered Agent Requirements in Texas
To comply with Texas law, your LLC’s registered agent must be a resident or business entity that maintains a physical address in Texas. The “registered address” cannot be a P.O. box. It must be a real physical address that can be visited in person.
Further, in Texas, your registered agent must agree to perform this role and sign a form confirming their consent. Consent statements should include the following:
- Written confirmation that the person designated consents to serve as the LLC’s registered agent
- The name of your Texas LLC and the person designated as your registered agent
- Registered agent’s signature
- Date of execution
Although you do not have to submit this form to the Secretary of State, your business must record it. Learn more about Texas Registered Agents by reading our full guide.
Sure. You or someone else in your company can serve as the registered agent for your LLC. However, you should consider the following concerns before deciding this:
In order to serve as your registered agent, you must be available during normal business hours. Taking business trips or working outside the office can make this requirement problematic.
See how our registered agent service for Texas LLCs can meet your needs so you don't have to worry about it.
Definitely. You can change your Texas registered agent by filing a Statement of Change of Registered Office/Agent with the Texas Secretary of State. The filing fee is $15.
Are You looking for a Registered Agent?
Wise Business Plans offers a free year of registered agent service when forming an LLC for you.
Step 3.Prepare and File Certificate of Formation
You must file Form 205 – Certificate of Formation with the Texas Secretary of State in order to register your Texas LLC. You may apply online, by mail, or in person.
There is a $300 filing fee. You must send the original and a copy of your certificate if you file by mail.
You will receive a duplicate form back from the state once it receives your documents.
It may take up to 40 business days to process a mailed submission.
There is a $25 expedited processing fee (4-5 days), but the state recommends filing online instead.
If you choose one of our business formation services, we can handle this step for you.
The following information is typically required to create a Certificate of Formation:
- Name and designation of the LLC Texas
- Name and address of your registered agent.
- Decide whether your Texas LLC will be member-managed or manager-managed. Indicate the names and addresses of each member and manager.
- The reason for forming the LLC in Texas.
- Name and address of the LLC’s organizer.
- The effective date of the certificate,
- The person forming the LLC must sign the Certificate.
In order to expand your existing LLC to the state of Texas, you must register as a Foreign LLC.
Two Ways to File the Certificate of Formation
The 1st option is:
Online filing of Form 205 with the Secretary of State
The 2nd option is:
Filing the Certificate of Formation by Mail or Fax
Address to Mail and to Submit Form In-Person:
Secretary of State
P.O. Box 13697
Austin, TX 78711
James Earl Rudder Office Building
Austin, TX 78701
In a member-managed LLC, the members (owners) take on the business's daily responsibilities. Manager-managed LLCs are managed by managers who are elected by the members. Those who manage your LLC will have the authority to do a wide range of tasks-from hiring staff to opening bank accounts.
When an LLC conducts business in the state where it was formed, it is called a "domestic LLC". We normally refer to an LLC as a domestic LLC when we talk about it. When an existing LLC wishes to expand its business to another state, it must form a foreign LLC.
If you choose to mail your Certificate of Formation, you can send it to:
- Secretary of State
- P.O. Box 13697
- Austin, TX 78711-3697
Online within 3 business days, by mail within 5 to 7 business days.
Step 4. Get a Certificate From the State
Upon filing your Certificate of Formation, the secretary of state will review it. As soon as the Certificate of Formation is approved, the LLC becomes a legal entity.
By obtaining this certificate, LLCs will be able to obtain an Employer Identification Number (EIN), licenses, and business accounts.
Step 5. Write an Texas LLC Operating Agreement
An operating agreement is a legally-binding document that sets out how your LLC will operate, from the voting process to mergers.
Operating agreements are not required in Texas, but they are an essential part of your business.
Written operating agreements are helpful for different reasons, including resolving disputes over financial agreements and other potential litigation.
The LLC declaration can prove that your LLC is a separate entity, which can help preserve your limited liability.
An operating agreement ensures that all business owners are on the same page and reduces the possibility of future conflict.
How should an operating agreement be drafted?
The operating agreement should detail the LLC’s overall business purpose and other important matters, such as how the company will be taxed and how new members will be accepted. Legal agreements can clarify several important concerns, such as:
- Who makes decisions for the company, especially those who decide if partners disagree.
- Who is responsible for different aspects of the business as well as for strategic decisions.
- If a partner leaves the company, what will happen to their ownership interests in the corporation.
- The members and their contributions
- How profits and losses will be divided
- Procedures for admitting new members and removing outgoing members
In Texas, you can include just about anything in your operating agreement, as long as it doesn’t violate the state law or the Certificate of Formation.
Yes. A single-member LLC must have an operating agreement in order to open a bank account and maintain limited liability.
Not at all. It is a document you should keep on file for future reference. Although many states do legally require LLCs to have operating agreements in place, not all do so.
Step 6. Get an EIN for Your Texas LLC
Basically, an employer identification number (EIN) is a social security number for your LLC in Texas.
To identify your LLC for tax purposes, the Internal Revenue Service assigns a nine-digit Employer Identification Number (EIN). You can apply for your EIN either by mail or online.
An EIN is used for the following purposes:
- Manage state and federal taxes
- Create a business bank account
- Hire employees
Get an EIN Number in Texas
Getting an EIN number is easy and free, There are two ways to get an EIN number in Texas.
The 1st option is:
Apply online for an EIN from the IRS
The 2nd option is:
Get an EIN by Mail or Fax
Address to Mail
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Yes. An EIN is only required if you are taxed as a corporation or hire employees. An EIN, however, is typically required in order to open a business bank account. By having an EIN, you can also avoid giving out your SSN to vendors.
A tax classification will be discussed with you when you obtain an EIN. In most cases, LLCs choose the default status.
Some LLCs can reduce their federal tax obligation by electing S corporation status. Consult with a local accountant to find out which option is best for you.
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What to do After Forming Your Texas LLC
Keep your personal and business assets separate
Your personal assets (such as your home, car, and other valuables) may be at risk when your Texas LLC is sued if they are mixed with your business accounts.
Here are some steps you can take to protect your LLC in Texas:
1. Create a Business Plan:
If you decide that a Texas LLC will be a good choice for your business in Texas, your next step is to create a business plan (although it is not required), so that you have a roadmap for what you will do and how you will accomplish it. You can also hire a professional business plan writer in Houston, TX for perfect business plan.
Free: Business Plans Examples
Do you need help creating a business plan? Check out these six free, proven business plan examples from different industries to help you write your own.
2. Open a Bank Account
As soon as your LLC is officially formed, you should open a business bank account. Why? Keeping separate bank accounts will help you maintain the legal distinction between the LLC and you (the owner).
Because LLCs are limited liability companies, creditors and litigants can’t take your assets.
It is essential for small business owners to partner with the right bank. Find out which banks offer the best business checking accounts, have low or no fees, ATM accessibility, and interest-earning accounts as well as online or mobile banking tools.
Recommended: Check out our business bank account page to learn which banks offer the best business check accounts, ATM access, interest-bearing accounts, and online and mobile banking options for businesses.
3. Obtaining a business credit card:
- Allows you to separate personal and business expenses.
- Develops your company’s credit history, which can be helpful to raise capital (e.g., small business loans) later.
4. Hiring a business accountant:
- It prevents your business from overpaying taxes while preventing penalties, fines, and other costly tax mistakes.
- Gives you more time to focus on your growing business by simplifying bookkeeping and payroll.
- Manage your business’s funding more effectively. Find out where extra profit or loss can be made
Getting Business Insurance for Your LLC
You can manage risks and grow your LLC with business insurance. Here are the most common types:
- General liability insurance protects your business from lawsuits. Most small businesses purchase general liability coverage.
- Professional liability insurance protects professionals and businesses from claims of negligence from their clients or customers. Liability insurance typically covers negligence, copyright infringement, personal injury, and more.
- Workers’ compensation insurance: Covers illnesses, injuries, and deaths resulting from a worker’s work.
Ready to Protect Your Business
Let us help you with your business insurance needs.
- General business liability insurance
- Medical insurance
- Term life insurance
- Workers’ Comp
- Surety bonds
- Commercial auto
Create Your Business Website
A website is an important step in legitimizing your business. It is essential for all businesses. You are missing out on a large percentage of potential customers and revenue if you don’t have a website, even if your business is too small or in an offline industry.
More than 90% of consumers begin their search for products and services online. If you don’t have a website that is ready to welcome your customers, then they will simply find your competitors.
Here are the main reasons why you shouldn’t delay building your website:
- Every respectable firm has a website. When it comes to getting your firm online, size or sector isn’t a concern.
- Creating a basic website has never been easier, thanks to website builder tools like the GoDaddy Website Builder. To design a website, you don’t need to hire a web designer or developer.
Recommended: If you want to enhance your conversion rates and maximize revenue in order to help expand your business and meet objectives, you should always hire a professional business website design company to build your business website.
Wise Business Plans is a leading web design company, We have created over 2000 + websites across 20 countries for our clients but we are physically based in 7 major cities in the United States including Alabama web design, Pennsylvania, Las Vegas, Colorado Springs, Iowa, Michigan and San Diego.
Texas LLC FAQs
To file an LLC Certificate of Formation in Texas, the Secretary of State charges a $300 filing fee, plus a 2.7% convenience fee mandated by the state. It costs $750 to register a foreign LLC in Texas.
A certified copy of the filing document, a certificate of status, and hiring an outside registered agent could increase this total by $85 to $535.
Applicants who want to reserve their LLC name before filing the Certificate of Formation will need to pay $40 to file a reservation application.
You can often file yourself, but completing and filing all of the forms yourself is often the most difficult. A lawyer is another option, but you will likely pay hundreds, if not thousands, of dollars for the service. With our LLC formation service, we can handle all of the filings and paperwork for you at an affordable price
Whether you are just starting a business or have already been running it as a sole proprietor, you should consider forming an LLC.
LLCs limit a business owner's personal liability for business debts and lawsuits and offer a lot of flexibility when it comes to business ownership, management, and taxation.
For more information on LLCs and to decide if it is the right business structure for you, visit What is a Limited Liability Company (LLC)?
It usually takes the Texas Secretary of State five to seven business days to process business formation documents after they receive them.
The good news is that you can significantly reduce your wait time by paying a little more for expedited processing. The process of expediting LLC formation can be handled by our faster filing speeds service.
An LLC can be dissolved by submitting a Certificate of Termination to the Texas Secretary of State. You can submit this form through the SOSDirect website or by mail, for a fee.
However, you cannot submit a Certificate of Termination without obtaining proof that your business' taxes are up to date in Texas. Before you can terminate your business, you must apply for and receive a Certificate of Account Status from the state comptroller's office.
Upon terminating your LLC with the Secretary of State, you will be asked to attach this document to your forms.
If another business is not using the new name, you can change the legal name of your LLC in Texas at any time. You can do so by filling out a Certificate of Amendment on the Texas SOSDirect website or by mail. A fee is required to file this document. Learn more about how to change a business name here,