Why Start a Texas LLC?
One of the most business-friendly states in the nation, Texas offers several business and tax incentives, provided your LLC meets certain criteria.
For example, the Texas Enterprise Zone Program (EZP) provides sales and use tax refunds to companies that invest in communities and create jobs. Companies must meet minimum capital investment requirements and must create and/or retain jobs that employ a certain percentage of economically disadvantaged people, enterprise zone residents or veterans.
For most people who want to start a business, creating a Texas limited liability company (LLC) is the easiest and fastest way. An LLC is an ideal business entity for startups and small- to medium-sized businesses because it offers the advantages and protections that larger corporations benefit from, but with simpler rules and regulations.
If an LLC isn't the right entity for the type of business you're starting, you may want to consider forming a Texas Corporation instead.
Benefits of starting a Texas LLC:
No state income tax, so you keep more of your earnings
High revenue threshold for Texas franchise tax liability
Separates and limits your personal liability from your business liability and debts
Simple filing, management, compliance, regulation and administration
Easy tax filing and potential advantages for tax treatment
Learn more about the benefits of the LLC business structure.
In this guide, you’ll find information on naming your LLC, getting a Registered Agent, the fees you’ll need to pay, business taxes and much more. We also cover what you'll need to register and file your LLC and how you'll interact with the Texas Secretary of State.
How to Form a Texas LLC Yourself in 6 Steps
Choose a Unique Business Name and Complete a State Business Search
You’ll need a distinctive and original name for your LLC that’s not used by any other business in the state. If you’re having trouble coming up with a name, try using our Business Name Generator to gather ideas. You'll need to follow a few naming rules, which you can read about in detail on the Texas Business Names page.
Once you’ve chosen a name, you’ll need to make sure it’s available in Texas. To find out whether another company in the state is using your chosen business name, use our tool to do a Texas entity search. You can also carry out a name search on the Texas Secretary of State website.
Provide an Official Address for your LLC
Every Texas LLC must have a designated street address, whether it’s an office building, a home (if you run the company from your residence) or any other physical location. It can be outside the state, and it can be a P.O. Box.
You may also be able to use a virtual mailbox for your business address. Incfile can provide you with a Texas virtual mailbox, where we'll receive your mail and scan it for your online review. This can be especially convenient if you run a home-based business and don't want your home address published as part of your business public record.
Assign a Registered Agent
Someone who receives official correspondence and is responsible for filing reports with the Texas Secretary of State is known as a Registered Agent. Every Texas LLC is required to have a Registered Agent.
You can fill this position, assign another manager in your business or use a Registered Agent service. If your Texas Registered Agent is a person, they must have a physical street address in Texas and must be present during business hours to receive important documents on behalf of your company.
You'll appoint your Registered Agent when you file your Certificate of Formation in Texas to create your business, and they must formally accept the appointment by filing an Acceptance of Appointment and Consent to Serve as Registered Agent form with the Secretary of State.
All of Incfile’s business formation packages include Registered Agent service. It’s free for the first year and just $119 per year after that. You can also access a digital dashboard to view any document we've received on your behalf.
File Your Certificate of Formation with the Texas Secretary of State
What some states call "Articles of Organization" Texas calls "Certificate of Formation." Once you've gathered all the information for your LLC, you’ll need to file a form with the Secretary of State to create your Certificate of Formation in Texas. This will officially create your business.
File by Mail
Secretary of State
P.O. Box 13697
Austin, TX 78711-3697
Submit in Person
James Earl Rudder Office Building
Austin, TX 78701
You only need to file your Certificate of Formation in Texas once, but every year after, you'll also need to report and pay Texas franchise tax (if applicable to your business) and file a public information report. Incfile can remind you about this every year, or we can do it for you if you have us handle the paperwork.
What are the fees and requirements to form a Texas LLC?
Both reports are due between January 1st and no later than May 15th.
There is no charge for the Public Information Report. The Franchise Tax Fee is based on the revenue of the LLC.
Get an Employer Identification Number (EIN) from the Internal Revenue Service
You'll need an EIN (Employer Identification Number) to identify your business to the IRS. You use this number when filing and paying taxes or when submitting payroll information and payments for your employees.
An EIN is also required to open a business bank account. You can obtain one directly from the IRS, or Incfile can get one for you as part of the Texas LLC formation process.
Create an Operating Agreement
A sort of "instruction manual" that explains how you'll run your business, an LLC Operating Agreement outlines how the business is divided among members, how decisions will be made and what will happen should a member leave the company.
Some states require companies to create this document. You're not legally required to have a Texas Operating Agreement, but it’s a good idea to have one to protect your business from any future changes and events.
Other Texas LLC Types
The state offers the option to set up a Texas Series LLC. This is a specialized business entity designed to allow you to manage multiple LLCs under one master LLC. It's a useful option if you want to avoid the time and expense of setting up a separate LLC for every business you run.
The state doesn't have a specific form for creating a Texas Series LLC. You'll simply use the standard form to create an LLC and provide the required information in the supplemental text area of the form. The filing fee is the same as for a regular LLC: $300.
Some states, including Texas, allow certain types of businesses to form Professional Limited Liability Companies (PLLCs). A Texas PLLC will typically require members to be licensed and may impose other requirements as well.
The list of career fields permitted to form PLLCs is extensive and includes but is not limited to accountants, electricians, real estate agents and cosmetologists.
To form a Texas PLLC, you'll need to fill out a form and pay the standard $300 filing fee. Your PLLC will also be subject to the state franchise tax and public information reporting requirements.
All of the Texas Professional LLC provisions are detailed in the state's Business Organizations Code, Chapter 301: BOC §301.
If your business operates in another state and you want to expand into Texas — or vice versa — you’ll need to form a Foreign LLC.
Learn more about Texas Foreign LLC registration.