State of texas LLC application [Guide]

Last updated : Sept 4, 2022

How do I form an LLC in Texas?

1. Name your Texas LLC.
2. Choose your registered agent.
3. Prepare and file Certificate of Formation.
4. Receive a certificate from the state.
5. Create an operating agreement.
6. Get an Employer Identification Number.
7. File an LLC Franchise Tax and Public Information Report.

How much does an LLC cost in Texas?

A new LLC that is being formed in Texas needs to file a Certificate of Formation—Limited Liability Company (Form 205) with the Texas Secretary of State, and pay a $300 filing fee. If you need a certified copy of the Certificate of Formation, there is a $30 fee. If you need a Certificate of Status, there is a $5 fee.

How long does it take to get an LLC in Texas?

The office normally processes non-expedited documents within 5-7 business days. Expedited service is available for an additional $25 per document and expedited documents are generally processed by close of business the first business day following the date of receipt.

What documents are required for an LLC in Texas?

You can create a Texas LLC by filing a Certificate of Formation for a Limited Liability Company (Form 205) with the Secretary of State. The certificate must include: the LLC's name, including the suffix. the name and address of the LLC's registered agent.

At what point do I need an LLC?

If you have business partners or employees, an LLC protects you from personal liability for your co-owners' or employees' actions. An LLC gives you a structure for operating your business, including making decisions, dividing profits and losses, and dealing with new or departing owners. An LLC offers taxation options.

Do you have to renew LLC Every year in Texas?

Unlike most states, Texas does not require LLCs to file annual reports with the Secretary of State. However, LLCs must file annual franchise tax reports (see below).

How much tax does an LLC pay in Texas?

Texas Taxes As mentioned above, Texas charges most local businesses the franchise tax, which is usually about 1% of some portion of the income of the company. This tax is leveled against LLCs, C Corporations, and S Corporations. Sole proprietorships and partnerships are immune to the tax.

How much does it cost to start a small business in Texas?

Registering a Business In Texas To set up a corporation, there is a fee of $300. For an LLC, it's $200 per partner. DBAs cost $25 to file. SOS Direct is up 24/7 and may charge a credit card fee, or you can file in person at the office in Austin.

How much is a Texas business license?

How Much Does a Business License Cost in Texas? If your municipality requires a standard business operating license or a specialized license, the cost may range from $15 to $30 on the low end to several hundred on the high end.

How much does it cost to get a tax ID number in Texas?

To obtain an EIN for your Texas business, you must file a Form SS-4. There is no fee for applying for an EIN.

Can I be my own registered agent in Texas?

Although an officer, owner, or employee may serve as an entity's registered agent, an entity may not serve as its own registered agent. An entity may contract for the provision of registered agent services from another business entity, such as a service company.

What is better a DBA or LLC?

Generally, a DBA is less costly to maintain, but an LLC offers better benefits and protection. Expanding and selling a business, as well as generating funding, is also easier with an LLC. Also, a business owner does not receive personal liability protection from a DBA.

Do I need a DBA for my LLC in Texas?

When Do You Need a DBA? In Texas, all corporations, limited liability companies (LLCs), limited partnerships (LPs), limited liability partnerships (LLPs), or out of state companies that regularly conduct business in Texas under a name other than its legal name, must file a DBA with the Secretary of State.

Do I need a DBA for my LLC?

No, you do not need a DBA for an LLC. This is because when you register an LLC, you'll also register your company name eliminating the need for a DBA. However, in some instances, you may use a DBA for your LLC to expand your business and operate part of it under a name other than your original business name.

What should I name my LLC?

• Make It Legal. The most important thing when you're choosing an LLC name is to make sure it's legal.
• Make It Memorable. You want your LLC name to be something people can remember.
• Make It Meaningful.
• Make It Original.
• Make It Distinctive.
• Make It Domain Name Ready.
• Make It Social Media Friendly.

Is it better to be self employed or LLC?

You can't avoid self-employment taxes entirely, but forming a corporation or an LLC could save you thousands of dollars every year. If you form an LLC, people can only sue you for its assets, while your personal assets stay protected. You can have your LLC taxed as an S Corporation to avoid self-employment taxes.

Should I start an LLC before making money?

Is an LLC Necessary To Start a Business? You don't need to start an LLC when establishing your business. However, if you want to differentiate between your assets and the company, an LLC is the right way to go. You should start an LLC if you want to start a business and protect your personal assets.

Do you need an LLC to write off business expenses?

What many self-employed people and small business owners don't realize is that you can still write off your business expenses without registering as an LLC.

Does an LLC have to file a tax return in Texas?

Unlike many other states, Texas doesn't require LLCs to file annual reports. Texas imposes a franchise tax on most LLCs, which is payable to the Texas Comptroller of Public Accounts. Franchise tax is based on the LLC's “net surplus,” which is the net assets minus member contributions.

What are the benefits of an LLC in Texas?

• Limitation of liability.
• Registration costs.
• Flexible tax treatment.
• Minimal formalities.
• Flexible membership.
• Registration costs.
• Registered agent.
• Texas taxes.

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hello everyone my name is samantha and i am with empower multimedia we post content regarding business academia and entrepreneurship remember if you ever need help with starting or growing your business click the link in the description for a free 15-minute consultation today we will be covering how to file an llc in texas just as a reminder this video is strictly informational not advice now let's get into it let's take a look at the six steps you need to do to file for your llc in texas this information is coming from nolo.com so the first step is to choose a name for your llc under texas law an llc must contain the words limited liability company or limited company and you can use abbreviations for this your llc's name must be distinguishable from the names of other business entities already on file with the texas secretary of state names may be checked for availability at the texas secretary of state sos direct website now you also have the option to reserve a name for 120 days by filing an application for reservation or renewal of reservation of an entity name which is form 501 with the texas secretary of state the reservation may be filed online through the texas secretary of state sos direct website or filed by mail the filing fee for this is forty dollars as a side note with names you don't have to use your llc's official legal name registered in your certificate of formation when you do business out in the real world instead you can use an assumed name also known as a dba which is short for doing business as or trade name or fictitious business name to do so you must register an assumed name certificate which is form 503 with the secretary of state of texas and with the county clerk in the county where your llc's office is located you can register online through the sos direct or by mail the filing fee for this is 25 so the second step is to appoint a registered agent every texas llc must have an agent for service of process in the state this is an individual or business entity that agrees to accept legal papers on the llc's behalf if it is sued the registered agent may be a texas resident or a business entity authorized to do business in texas the registered agent must have a physical street address in texas and the llc may not be its own registered agent your third step is going to be to file a certificate of formation a texas llc is created by filing a certificate of formation for a limited liability company which is form205 with the secretary of state the certificate may be filed online through the texas secretary of state sos direct website or by mail the filing fee is going to be 300. now here is what the certificate must include the llc's name including the chosen llc designation the name and address of the llc's registered agent whether the llc will be member managed or manager managed if member managed the name and address of each initial member if a manager managed the name and address of each initial manager the general purpose clause as provided the name and address of the llc's organizer the effective date of certificate and the signature of the organizer so your next step you're going to want to consider preparing an operating agreement so this is not required in texas but it is highly advisable this is an internal document that establishes how your llc will be run it is not filed with the state it sets out the rights and responsibilities of the members and managers including how the llc will be managed it can help preserve your limited liability by showing that your llc is truly a separate business entity in the absence of an operating agreement state llc law will govern how your llc operates the operating agreement should include the following the member's percentage interests in the llc the member's rights and responsibilities the members voting powers how profits and losses will be allocated rules for holding meetings and taking votes and finally bio or buy cell provisions which determine what happens when a member either wants to sell his or her interest dies or become disabled your next step is going to be obtaining an ein now if your llc has more than one member it must obtain its own irs employer identification number or ein for short and this is even if it has no employees if you form a one member llc you must obtain an ein for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship you may obtain ein by completing an online ein application on the irs website and for this there is no filing fee finally you're going to want to consider annual reports now unlike most states texas does not require llcs to file annual reports with the secretary of state however llcs must file the annual franchise tax reports so now that it's all said and done how much does it cost to form an llc in texas so this texas secretary of state charges a 300 filing fee plus an additional state mandated 2.7 convenience fee to file an llc certificate of formation it will also cost forty dollars to file a name reservation application if you wish to reserve your llc name prior to the filing certificate of formation just as a note for veterans if you are forming a 100 veteran-owned business the secretary of state will waive this filing fee for qualifying veterans for example honorable discharges and these are if they file directly by mail in person or by fax and for more information visit the secretary of state's business information for veterans page so what about foreign llcs in texas to do business in texas all llcs organized outside of the state must register with the texas secretary of state foreign llcs must appoint a registered agent for service of process the agent may be a texas resident or a business entity authorized to do business in texas to register file an application for registration of foreign limited liability company form 304 the application may be filled online or in postal mail the filing fee for this is 750 before filing the application make sure the llc's name is available in texas by checking the texas business name database if the name is not available the foreign llc must adopt an assumed name for use in texas the llc must file an online or by mail and assume name certificate which is form 503 with the secretary of state and pay a 25 filing fee now for thinking about taxes in some cases for example you will be selling goods and collecting sales tax you will need to register with the texas comptroller of public accounts texas also imposes an annual franchise tax on most llcs depending on the tax involved you may be able to register online by mail or in person at the comptroller field office that sums up the video thank you for watching and please remember to like comment and subscribe remember if you ever need help with starting and growing your business click the link in the description for a free 15-minute consultation

Thanks for your comment Brent Dougharity, have a nice day.
- Alexander Durio, Staff Member

how to start an llc in texas hi my name is eric and in this video i'm going to show you three methods to start an llc in texas why you might want to choose one method over another but also some things to be aware of when setting up your llc if you're not familiar with the term piercing the corporate veil you'll definitely want to watch this video and towards the end of this video i'll actually talk about ways that you can potentially save on taxes with your business so first method that you can do is going directly through your state website with texas state.tx.us and this is the link right here you can find that in the description of this video and any kind of question you have about setting up an entity in texas is going to be on this page the one downside of going through your state website is a lot of times they're not the easiest tools to navigate you know from a user experience it can be kind of difficult and they'll just throw so much information at you so you're like where do i even go well the first thing you may be interested in is the fee schedule so if you look at this again a lot of information but what we want to look at is this row here this is the cost for you to set up an llc in texas the filing fee is 300 so no matter what route you go you're not going to get around this 300 filing fee with the state of texas just know that up front but now if we go back why don't we take a look and scroll down here it says can i file a certificate of formation online so if you do the diy route you're just using the state website it says sos direct and this is going to take you through where you can enter the site if you do go this route it is one dollar to get set up it's just kind of like to help them with their operations again though some of the difficulty of going these routes is these sites through a state website can be pretty hard to navigate and it's like you need adobe acrobat and winzip and it's just going to throw a lot of information at you that can be kind of complicated now in your situation if you do have a complicated situation you have a business that's making money you're doing sales out of state you're not sure where to get set up and what you're supposed to be doing sometimes with a complicated situation you may want to consult with an attorney one resource i'm not affiliated with them in any way but i just like them they're called avo and what you can do there is you can put an llc in texas so this would be kind of your second method that you can take if you're setting up an llc in texas and what i would recommend is skip past the ads right and then go down to the people that are just organically listed here what you'll find is you'll see reviews and you'll also see their avo rating so you know based on those reviews you get somebody with a good review a good rating and then let's say you click on them you can also see all right llcs represent 12 of his uh total business and he also focuses on business and estate planning so you want somebody that that's what they do they're in the state of texas and they can consult with you some of these people you'll find on here also do offer a free consultation kind of depends from attorney to attorney but if you click around you may find that some of them offer a free consultation now this route though if you go with hiring an attorney to set up your llc you could be looking anywhere from a thousand to three thousand dollars once you actually go through the process but it's highly recommended if you have a complex situation i'm not an attorney or cpa i did consult with several different ones for setting up my own llc and what i can tell you is if you have a complex situation consult with an attorney all right so a third potential method that you can go is through a service like ink file if you're not familiar ink file is very much like legalzoom or zen business or rocket lawyer if you're familiar with all these services the one way the ink file kind of deviates from those services is the fact that they charge you zero dollars in the first year literally if you get set up with the service they will make no money off of you for the first year and they have a very clean interface and it's very easy to follow on how to set up your business so in this particular case let's say you're setting up the llc and your state of formation is texas what you'll see here is in their silver package is that you pay that state fee it's 300 but your package fee is zero that's if you stay with the silver package but what i want to highlight here is the free registered agent service for a year this is really important so going back to the cost of what it is for setting up an llc in texas what i have highlighted here is that 300 state filing fee ongoing llc fees are zero if you're curious this link will take you to a website called nolo that explains that in further detail why you don't have any kind of fees going forward um but uh you'll also see that there is a registered agent fee of 119 now if you go back to the ink file page here you can see that it's a free registered agent service for a year but year two year three it's 119 now you might be wondering like what is a registered agent fee this ink file service tons of great resources in here and they have about registered agents a lot of information you can absorb here if you scroll down to this section right here you'll see that this is where it's 119 after your first year is free but really what a registered agent is doing for your llc is it's making it a legit entity because it is required that you have a registered agent on file and typically that registered agent is a third party that accepts legal documents also lets you know if you need to renew with the state if there's any important updates or anything that you need to do that's very important for your business now in the unfortunate situation if you were sued by an outside party what would happen is that attorney would actually send the document to your registered agent which would then give you that legal document letting you know that you're being sued and what you need to do next and that's why it's very important to have a registered agent set up in fact if you do not have a registered agent for your llc it could be found that your llc is not legit now why is that important at the beginning of this video i talked about piercing the corporate veil now some people get llc's a little bit confused they think they may be setting it up for tax reasons really when you're setting up an llc you're just doing it to limit your liability now what the llc does is it helps create a divide between your personal assets and your business assets so then in the unfortunate situation where you are sued in your business they can't go after your personal assets such as your home your car and your personal bank account now the important thing to understand is that if you're sued the attorney that is doing the suing is going to look for cracks in your llc what they're going to do is try to pierce the corporate veil one way they may do that is to see if you actually have a registered agent on file is

Thanks groguenc7 your participation is very much appreciated
- Alexander Durio

About the author

Alexander Durio

I've studied marine chemistry at Erskine College in Due West and I am an expert in medieval philosophy. I usually feel sick. My previous job was aircraft mechanic I held this position for 8 years, I love talking about ephemera collecting and legos. Huge fan of Paul Rudd I practice skydiving and collect cards.