A Texas LLC is a business structure much like a hybrid between a Partnership and a Corporation. A TX L.L.C. (limited liability company) has a Partnership's flexibility regarding management, taxes, and certain operations. Like a Corporation, an LLC is formed at the state level, has its own separate legal identity, and has liability which is limited to the assets owned or controlled by the LLC. This means that the debts and assets of the business belong to the LLC, not you. So if the business is sued, damages are usually limited to the LLC’s assets (not your house or car).

Can you be your own Registered Agent for your Texas LLC?

Yes. But, keep in mind that acting as your own registered agent means listing your personal information on the Certificate of Formation. You’ll also be required to maintain regular business hours so you can accept documents in person. Hiring a registered agent allows you to keep your personal information off public record and means you won’t be held down by the need to maintain regular business hours.

How do you file a Texas LLC Certificate of Formation?

You can submit your certificate online or by mail. Mail: Secretary of State PO Box 13697 Austin, TX 78711-3697 Online: SOSDirect

Is a Operating Agreement required for Texas LLCs?

Technically, Texas doesn’t require your LLC to have an operating agreement (or “company agreement”). According to TX Bus Org § 101.001(1), a company agreement can be “written or oral”. Although it’s not legally required, having an operating agreement can help resolve disputes among members and protect your limited liability status. So, it’s vital that you have a written agreement. Operating agreements are internal documents, so you don’t need to file them with the state. However, your LLC will be governed by Texas’s default LLC statutes if you don’t adopt an operating agreement.

Does my Texas LLC need an EIN?

Yes. While only LLCs with multiple members, employees or corporate tax status are legally required to have an EIN, virtually every LLC will need an EIN to open a company bank account. Not only that, but your EIN protects your identity by giving you an alternative to use with vendors or other business associates instead of your social security number.

Can I reseerve a Business Name in Texas?

Yes. Texas allows you to reserve a business name for up to 120 days by filing an Application for Reservation or Renewal of Reservation of an Entity Name. There is a $40 filing fee.

How are LLCs taxed in Texas?

By default, LLCs in Texas are taxed as pass-through entities. This means that profits from the LLC get distributed to the members, who then report their shares on their personal tax returns. Texas LLCs are also subject to the federal self-employment tax rate (15.3%). LLCs can also file paperwork with the IRS to be taxed as an S-corp or a C-corp.

When is the Texas Annual Franchise Tax Report due?

Your Texas LLC's Annual Franchise Tax Report will be due by May 15 each year. The report can be filed online or by mail.

Start an LLC in Texas

Use our free business tools below to complete your Texas LLC Certificate of Formation. This is the document you file directly with the Texas Secretary of State to form your LLC.

If you want more, hire us to form your LLC in Texas for just $39 + state fees. We’ll get your business stood up in minutes with a free domain, website, email, business phone, and more.

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with the help of a Registered Agent

How to Start an LLC in Texas

Reviewed by Andrew Corsberg, Esq. May 5, 2023

Forming an LLC is a great move when starting a business in Texas. LLCs provide liability protection with a legal distinction between you and your company. Plus, LLCs are taxed as pass-through entities by default, meaning the LLC itself doesn’t pay taxes but the profits pass-through to the owners and are reported on their taxes.

To form your Texas LLC, you’ll need to file a Texas Certificate of Formation with the Texas Secretary of State and pay a $310 filing fee. But if you want your LLC to run properly, you’ll also want to take some extra steps, like getting an EIN, opening a business bank account, and writing an LLC operating agreement. Follow this guide for everything you need to start, run, and maintain your Texas LLC.

How to Start an LLC in Texas (Update in description)

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1. Name Your LLC

Before you can file a Texas Certificate of Formation, you’ll need a name for your business. You can call your LLC almost anything you like, as long as it’s not already in use and follows Texas’s general entity name rules and LLC naming statute s. In particular, your LLC name must:

Include an indicator like “limited liability company” or “LLC.”
Not include words or abbreviations that suggest your LLC is something it’s not, such as using the identifiers “LP” or “corporation,” implying government affiliation, or using terms restricted to licensed businesses (for example: “Insurance Agency”).
Be distinguishable (sufficiently different) from the names of other Texas businesses.

Texas’s Taxable Entity Search page is a good resource to check whether your preferred name is available.

Tip: If you’re not ready to form your LLC, Texas lets you put a hold on a name by filing an Application for Reservation or Renewal of Reservation of an Entity Name. It costs $40 to file, and name reservations are valid for 120 days (with the option of renewing for another 120 days).

2. Register Your Domain Name

Next, you should obtain a domain name for your LLC’s business website. A domain name is the thing that lets people find your business online. Your business domain name should match your business name, or at least connect to your business name or what your business does.

(You might think securing a domain before you’ve even formed your business might be premature, but landing your ideal domain name early on can save you frustration down the line if that name later gets claimed by someone else.)

A professional domain also offers certain benefits you won’t get from free online website hosting. It shows that you’ve taken the steps to craft a credible online presence customers can connect with and trust. A domain that matches or corresponds to your business name also helps reinforce a consistent business brand, helping customers recognize and remember your business.

A domain name also lets you access a professional business email address, which you can even use before your website is ready to go live.

Tip: Northwest offers a year of free domain registration and business email whenever you use us to help you form your business.

3. File Texas LLC Certificate of Formation

With a business name and domain secured, it’s time to file a Certificate of Formation with the Texas Secretary of State, along with a $300 filing fee. After filing this document, you will have officially created your Texas LLC. To do that, you’ll need to provide the following information:

Note: All of the information on this form will become part of the public record.

Include an indicator such as “limited liability company” or “LLC.”

Include the name and address of the individual or business entity that will accept legal and state documents on your behalf.

Indicate whether your LLC will be member-managed or manager-managed, and include the name and address of each member or manager.

This entry is optional. The Certificate of Formation already states that you may form an LLC in Texas for any lawful purpose. You can include a more specific business purpose, but it’s not required.

This can be a PO box.

You can include additional provisions or leave this optional section blank.

This is the person filing your certificate. They do not otherwise have to be associated with your LLC.

You may include a future date (up to 90 days) to delay the start of your LLC or select “A” for the earliest possible formation date.

This is where your organizer must sign and date the form.

How do I submit a Texas Certificate of Formation?

You can file your forms with the Texas Secretary of State online through SOSDirect, or by mail at:

Secretary of State
PO Box 13697
Austin, TX 78711-3697

Note: When filing by mail, you must include your original certificate and a duplicate copy of your certificate. Once the state receives your documents, the duplicate form will be stamped and returned to you.

What is a Texas Series LLC?

A series LLC is an LLC that contains multiple LLCs within it, each viewed as their own company. To start a series LLC in Texas, you’ll need to submit a supplemental Series LLC provision along with filing your Certificate of Formation.

Learn about every part of starting a series LLC in our Texas Series LLC Guide.

4. Write an Operating Agreement

Your LLC’s operating agreement is the operating system of your business. It spells out your LLC’s rules for financial contributions, management roles, voting rights, and other responsibilities expected of LLC members.

Officially, Texas doesn’t require your LLC to have a written operating agreement—an oral agreement is also considered valid. But a tangible operating agreement can help resolve member conflicts and keep things running properly. Many banks also require a documented operating agreement when opening an account for an LLC.

A documented operating agreement can also aid in shoring up your limited liability status. Without an operating agreement, a court may view your LLC as a sole proprietorship or partnership and jeopardize your liability protection.

Plus, without one, your LLC has to operate according to Texas’s default LLC statutes, rather than how you and any other members want to run it.

Check out our free attorney-drafted Texas LLC Operating Agreement.

A solid operating agreement should provide a detailed overview of the LLC’s overall business purpose and other “big picture” situations, such as how the company will be taxed and accept new members. Here’s a list of other topics typically included in operating agreements:

initial investments
profits, losses, and distributions
voting rights, decision-making powers, and management
transfer of membership interest
dissolving the business

Texas allows you to include pretty much anything in your operating agreement—so long as it doesn’t violate state law or the Certificate of Formation.

Yes. You might not need an operating agreement to manage a dispute with yourself, but you’ll still need one to open most business bank accounts and maintain your LLC’s limited liability.

5. Get an EIN

An EIN (employer identification number) is an number the IRS provides businesses which can be used like a social security number. Any LLC with employees (or more than one member) must obtain an EIN, but even single-member LLCs with no employees need an EIN to open a business bank account. Plus, without an EIN, you have to risk giving out your own social security number when conducting business with vendors and other associates.

There’s no fee to get an EIN from the IRS, and you can get one fast by applying online. However, if you don’t have a social security number, you’ll have to send a physical Form SS-4). Alternatively, you can hire us to get an EIN for you.

6. Open a Bank Account

Mixing business finances and personal finances weakens the legal separation between you and your LLC, and that could leave you vulnerable to seizure of personal assets for judgments against your business. The best way to prevent that separation from breaking down is by opening a bank account for your LLC where business money can’t get intermixed with personal money.

Banks have varying requirements for opening a business account can vary, but you’ll probably need to bring the following to the bank:

your Texas Certificate of Formation (a copy works too)
your LLC operating agreement
your LLC’s EIN
a LLC Resolution to Open a Bank Account, if your LLC has more than one member

7. File a Beneficial Ownership Information Report

After forming your LLC, you’ll have 90 days to file a Beneficial Ownership Information Report with the Treasury Department’s FinCEN (Financial Crimes Enforcement Network) bureau. This report discloses some basic information about the beneficial owners who control your LLC, as well as about the company applicant or applicants who filed the paperwork to create it.

Note: Unlike your Certificate of Formation, the BOI Report isn’t public record. The information on your BOI Report will only be accessible to government and law enforcement agencies. Financial institutions can only access BOI Reports for the purpose of confirming customer identities.

You can file the BOI Report online, or hire us to take care of it for $9.

8. File Reports & Pay Taxes

After forming your LLC, you’ll eventually have to file an Annual Franchise Tax Report, which is basically a tax return. All Texas LLCs must file the report with the Texas Comptroller of Public Accounts every year on May 15, and can do so online or by mail.

By reporting revenue and your LLC’s industrial classification, this filing determines how much franchise tax your LLC needs to pay. However, most businesses won’t need to worry about franchise tax, because the amount of business revenue required to pay franchise tax starts at $2,470,000.

*This is informational commentary, not advice. This information is intended strictly for informational purposes and does not constitute legal advice or a substitute for legal counsel. This information is not intended to create, nor does your receipt, viewing, or use of it constitute, an attorney-client relationship. More information is available in our Terms of Service.