how to file for a texas llc [Excellent Tips]


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Last updated : Aug 12, 2022
Written by : Thaddeus Dinucci
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how to file for a texas llc


Comment by Linette Binker

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 Linette Binker, have a nice day.
- Thaddeus Dinucci, Staff Member


Comment by Shawana

do you want to start an llc in texas this year today you will learn about the most common ways to start your business including the correct forms you'll need how to register your llc critical naming requirements and all other vital tips and tricks then as a bonus later on in the video i will reveal to you a trustworthy registered agent who will help set up your llc for free so make sure to stick with me until the end the state of texas like other states has several specific llc requirements there are three main ways you can start an llc in texas first is the diy or do-it-yourself process where you mostly depend on texas state's website the second way is hiring a professional service that practically offers more efficiency and security in the process of creating your llc while the third one is hiring an attorney we will skip the attorney hiring portion because that's expensive and most business owners won't need that service first let's take a look at the steps required for starting an llc on your own step one name your business before anything else you will have to think of the llc's legal business name each llc in texas must have a distinct llc name that is not currently in use you must include the terms limited liability company or an abbreviation such as llc you cannot include phrases such as a corporation which would lead people to believe you are a different business organization knowing if your business name is taken or not is very easy just go to google and type in the words business entity records texas secretary of state and click the first search result i also have the link in the description below for your convenience it will lead you to a landing page of business entity records in texas scroll down a little and you will see some search options which make checking the availability of your business name easier generally you can click the first option entity name and type in your business name for example i am typing a very common business name here laundry mart which will give you a list of existing business names a unique business name will say no matches found just like this random name i typed in keep in mind that the division of revenue doesn't check names for trademark compliance it's ultimately up to you and your business attorney to ensure that your llc's name doesn't infringe on any other company's rights step two texas requires llc to have a registered agent an agent has a physical address a po box is not allowed and is available during business hours this agent will serve as the llc's primary point of contact for receiving key legal papers tax warnings summons subpoenas and so on you can register yourself or someone in your company but i highly recommend getting a professional registered agent as they have more knowledge by protecting your company in cases of possible cracks while i agree that family members or friends are reliable enough to be trusted as your llc's agent you are more comfortable sleeping at night knowing that your agent is professional and trained to manage legal documents to avoid problems concerning court schedules filing reports with the secretary of state etc besides hiring a professional registered agent is not expensive in fact there are companies that offer a free registered agent as part of your package when you form your llc through them inc file is a company i recommend which has this free service inc file offers a free registered agent on your first year of signing up for their service during that free year you can already take advantage of a professional and trained agent to receive legal documents on your behalf a dashboard where you can always access the correspondence that your agent has received as well as email notifications and automatic forwarding whenever your registered agent receives documents step 3 filing the texas llc certificate of formation after that you must file the certificate of formation with the texas secretary of state's business entities division and the office of the judge of probate to officially incorporate a domestic texas limited liability company the texas state filing cost for llcs is two hundred dollars for domestic llcs and 750 dollars for foreign llcs basically a domestic llc means that you are already a resident of texas and you want to build a business in texas foreign llc on the other hand is for people living outside texas but wanting to start a business or a franchise of their business in texas with that said most businesses would be applying for a domestic llc you can file the certificate of formation online or by mailing it to the secretary of state expect the llc certification process to take approximately two weeks this is three to four days for the judge of probate and ten days for the secretary of state step four prepare an operating agreement now an operating agreement is a good idea to have in place with the other members if your llc has more than one member although a limited liability company operating agreement is not necessary for texas your operating agreement should clarify how your company or business will handle big picture issues such as allocating earnings and losses and dissolving the company your operating agreement should also cover the transfer of membership interest profits or losses and distributions initial investments decision making powers voting rights and management and lastly dissolving the business step five of file annual reports 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 the details for computing the tax can be complicated for more information check the comptroller of public accounts website and texas llc annual filing requirements step 6 obtain an ein an ein or employer identification number is a federal tax id issued by the irs your ein is used by them to readily identify your firm and tax filings all texas firms pay a business privilege tax and the state requires you to have an ein to file you may also be required to provide your ein when opening a bank account or applying for municipal permits or licenses obtaining an ein is a slightly longer process compared to their previous steps i'm sure you know anything to do with the irs is confusing first you have to have complete knowledge of your llc such as your company information managing member information business address business information company details and even critical information regarding vehicular assets and federal excise taxes this is another reason why getting a professional registered agent is way more convenient as they can do this for you as part of their service now let's talk about the second option to form an llc and that is hiring a professional formation service professional formation services do all the steps you should be doing on your own from filing necessary forms to acting as your registered agent you usually have to allocate a specific budget for this option as i already mentioned earlier inc file is one of the best companies out there to help you form your llc you can click on the link in the description to get access to this


Thanks Shawana your participation is very much appreciated
- Thaddeus Dinucci


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