Texas, one of the best states for starting a business, offers numerous benefits for aspiring entrepreneurs. Starting up an LLC in Texas involves a few key steps to follow. It is essential to note that in Texas, searching for a business on the Secretary of State's website may incur a $1 fee (🔗SOSDirect). As soon as all the steps mentioned in this article are followed correctly, it takes no time to form your LLC in Texas.
If you prefer assistance with the formation process, you may choose to use an LLC formation service. These companies do everything on your behalf while you can focus on your revenue. On this page, all the important steps are explained. Additionally, a video is shared for those who prefer not to read a lengthy article. :)
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How to Start an LLC in TexasAfter Starting Your Texas LLCTexas Foreign LLCTexas LLC Formation ReviewF.A.QsHow to Start an LLC in Texas
An LLC (aka Limited Liability Company) is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thereby providing personal asset protection. For an LLC, the members' personal assets are not affected by the business's debts. However, in some cases, if the LLC is sued for business debts, courts might pierce the corporate veil and use the owner's personal assets to meet the corporation's liabilities.
If you wish to start an LLC, you must file your Certificate of Formation with the State and pay a filing fee of $300 (🔗Secretary of State, Fee Structure). While it's the most important step, it's not the only one. There are 4 other crucial steps to follow to form your LLC in Texas. Below are all 5 steps that explain everything you need to do to start a Texas LLC in 2026. Let's get started!
Step 0Decide on the Structure and Nature of the Business
Before you start filing your LLC in Texas, you must decide on the structure of your LLC (whether it is a Single-member or a Multi-member LLC). A single-member LLC is a business structure in which only one individual owns and operates the company. This type of limited liability company (LLC) provides legal protection to its owner and enables them to operate their business while taking advantage of certain tax benefits. In contrast, a traditional multi-member LLC must have at least two members involved in the company’s management and ownership.
For both types of structures, the process of establishing is the same in Texas. The tax burden might be different if you chose a different tax structure while filing the certificate of formation.
LLC vs S-Corp
An LLC is a business structure that has the right to elect any tax structure. Despite having a pass-through tax advantage, many LLCs, for several reasons, elect a different business structure for tax purposes. An S-Corp is one of those business structures that LLCs can elect. The S-Corporation is a type of corporation that is less complicated than a C-Corporation and has vast tax benefits.
With an S-Corp, the LLC can still enjoy a pass-through taxation. However, the federal income tax will be calculated on the basis of the salary of the owner and the return he/she gets on their share of the company. There is no corporate income tax or problem of double taxation in an S-Corp. A single-member LLC, make sure that the number of members does not exceed 100 to be an S-Corp.
If you have a single-member LLC, electing an S-Corp can save a chunk of tax for you. As a single-member LLC, the owners have to pay by the LLC. Read more on what tax forms LLCs file.
Step 1Decide on a Name for Your Texas LLC
The first step in forming a limited liability company in Texas is to give a proper name to your LLC. Before you name your business, you must know that the name should be easy to remember, available in the state, and follow all the LLC naming guidelines.
LLC Naming Guidelines in Texas
There are a few specific requirements all the LLCs in Texas have to follow while naming their Company. Some of the most important requirements are as follows:
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"Limited Liability Company", "LLC", "L.L.C.", "LC", "L.C.", and "Limited Company" - any one of these has to be used as a suffix in your business name.
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You cannot use any name for your business that is confusing or misleading. Terms such as "Treasury", "State Department", "FBI", "CIA", etc. shouldn't be included.
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Terms like "Bank", "University", "Attorney", "Doctor", etc, can be added only after the additional requirements by the Texas State Government are fulfilled.
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(Optional) It's better to name your business something for which your desired domain is available.
| Important Links - | Submit Offline Form to - |
|---|---|
| Texas Business Entity Search - Online Name Search Texas Taxable Entity Search - Online Entity Search by Tax ID/EIN Name Reservation Form - PDF Name Reservation Form - Online Texas LLC Name Search Guide - Instructions Name Availability Standards - Guidelines |
Secretary of State P.O. Box 13697 Austin, TX 78711-3697 |
Reserve Business Name for Future
If you do not wish to file your LLC right now but want to hold the name you have decided on, then you can reserve your LLC name for 120 days (🔗Texas Secretary of State). To keep the name, you have to file a name reservation application and pay $40 to reserve your name with the Texas Secretary of State.
Doing Business As (DBA) or Trade Name
Once you have a legal name for your LLC, you can register it. However, it is not mandatory. You can, instead, use DBA, Fictitious Name, or Trade Name. In that case, you must register your name with the Texas Secretary of State by submitting Form 503 (Assumed Name Certificate) along with the filing fee of $25.
Do I have to include LLC in my company email/domain?
It is not legally mandatory to use the word LLC in your domain name or email. If you want, you can use it. However, it is recommended not to use LLC in the domain name. A domain name should be short and easy to remember.
Step 2Assign a Registered Agent in Texas
The second step to forming an LLC in Texas is to appoint a Registered Agent. A registered agent is a person or business entity working on your LLC's behalf. This person or business will receive important tax forms, legal documents, all notices of lawsuits, and other official government correspondence in Texas. Hence, hiring a competent Texas Registered Agent for your LLC is necessary.
Make sure your registered agent has a physical street address in Texas where legal documents can be received during normal business hours. Most LLC formation companies also provide registered agent services. Below are two great LLC formation services; even if you buy their cheapest plan (normally $0), you also get registered agent service and other services at a very reasonable price.
- 1-day rush filing (add-on)
- Attorney help (legal plan)
- Established reputation
These two are our top recommendations for LLC service, as they are competent and authorized to conduct business in Texas. Some LLC formation services also offer standalone Texas registered agent services. You can purchase only Registered Agent services without purchasing any other LLC formation services.
Who Can Be a Registered Agent?
A person above 18 years of age who has a physical address in the state of Texas can be a Registered Agent. A Registered Agent can be an independent person or a business entity. One is responsible for handling all the legal documents on the LLC's behalf.
Can I Be My Own Registered Agent?
Yes, you can be your own registered agent if you are a resident of the state of Texas and you are above 18 years of age. To become a registered agent, you must have the authority to conduct any type of business in Texas.
Why Shouldn't I be My Own Registered Agent?
There are a few reasons why you shouldn't be your own registered agent. The address of the registered agent is used to communicate with the SOS or for any legal activities. If you are your own registered agent, you might have to upload your personal address to the public forum. Besides, the registered agent must be at the address during business hours. It won't be easy for you, as you also have to take care of other things in your LLC. Hence, it is wiser to appoint a separate entity as your registered agent.
What is Piercing the Corporate Veil in an LLC?
If an LLC is sued in Texas, in some cases, courts might decide to lift the corporate veil, which means the owners of the LLC will be personally liable for their business debts. They might have to forgo their personal assets to repay their business debts. This is called piercing the corporate veil, where personal and business assets are no longer separated. Your personal assets can be protected if you have enough capital and all your LLC documents are properly filed.
Registered Agent Consent Application
In Texas, the registered agent can sign a consent letter (online or offline) confirming consent to being appointed in written or electronic form. This consent must include the following details,
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LLC name
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A letter that says the person gives consent to serve the LLC as a registered agent
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The execution date
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Name of the registered agent
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Signature of the registered agent
This consent letter assures that the Registered Agent has given their nod for the service of process as an Agent. They can reject the appointment, too, by filing a Rejection of Appointment. LLCs don't need to file this consent letter with the Texas SOS. However, it is recommended to have this letter filed with the SOS to avoid any future discrepancy between the Registered Agent and the LLC. The Acceptance of Consent (Form 401-A) can be filed by paying a fee of $15 (🔗Secretary of State, Fee Structure).
Step 3File Certificate of Formation in Texas
The third and most important step in forming an LLC is to file the Certificate of Formation. This Texas Certificate of Formation is a legal document that is required to register your business with the Texas Secretary of State. It costs $300 (online and by mail) to file your formation certificate in Texas.
The Certificate of Formation includes details like the name of the LLC, the registered agent's name, address, and company structure (member-managed or manager-managed). Before hiring employees in a Texas LLC, one should thoroughly know the rules and regulations. Also, if you are expanding your existing business (an LLC) in other states to Texas, you must register as a Texas Foreign LLC.
How to File Online
Go to the Secretary of State Online Service. You will get the login page. If you are already a subscriber, then log in with your credentials. If not, then you have to request for SOSDirect Account. You can either select the option 'Request for SOSDirect Account' from the Login page or click on the button below. Read more about the Texas Certificate of Formation for online registration.
How to File by Mail
If you prefer filing real-life forms for your LLC registration in Texas, you can download Form 205. Read the form thoroughly, fill it out, and send it to the address mentioned below.
Mailing Address: Secretary of State
P.O. Box 13697
Austin, TX 78711-3697
In-Person Submission:
James Earl Rudder Office Building
1019 Brazos
Austin, TX 78701
Processing Time: Online filings are generally processed in about 3-5 business days. Mail filings typically take 5-7 business days.
Step 4Create Your Texas LLC Operating Agreement
Moving on to the fourth step, creating your operating agreement. An operating agreement is an internal document that legally outlines the proprietorship and operating procedures of your LLC. This document is vital as it ensures that all business owners are on the same page regarding how they operate, their voting power, business dissolution, and such, thus reducing future conflicts.
When it comes to creating a Texas LLC Operating Agreement, the state does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all the details of your business operation, which helps in making future business decisions, especially if you decide to dissolve a Texas LLC later. Hence, having an operating agreement may not be necessary, but it is surely ideal.
Step 5Filing a Texas LLC EIN
The Employer Identification Number or, simply, the EIN is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify the type of business for tax purposes and taxes in general. The EIN is necessary for any active business or any form of business, for that matter.
For an LLC in Texas, an EIN is required when the LLC hires employees. Apart from that, banking services, tax filings, and many other government documents require an LLC to obtain an EIN in Texas. On the other hand, if your LLC is based in another state (home state) and you are expanding your business in Texas, you must get an EIN to establish a Foreign LLC in Texas.
To obtain an EIN (aka FEIN), one must fill out a form (Online or by mail) and submit it to the IRS. Enter details of your LLC, and finally, complete the form and send it to the address given. You can also get an EIN Assistant to help you with the process.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
After Starting Your Texas LLC
After forming your LLC, there are still some things that you will need. The most important thing is to separate your business and personal assets. LLCs have limited liability protection that protects your personal assets from business liability. This is called a corporate veil. However, the corporate veil can be lifted or pierced by the court if the LLC is sued. In that case, the owners of the LLC become personally liable for their corporate debts. A few things, like appointing a legit registered agent, having enough capital, and filing all the major documents with the state, can save the LLCs from being pierced through the corporate veil.
BOI Report Filing
According to the Corporate Transparency Act, foreign entities registered to do business in the U.S. must file a BOI report with FinCEN. However, note that as of March 26, 2025, FinCEN issued an interim final rule removing BOI reporting requirements for all domestic U.S. companies and U.S. persons. If your LLC was formed under U.S. law, you are currently exempt from BOI filing obligations — consult the FinCEN BOI page for the latest guidance, as this regulatory area remains subject to change.
Apart from that, there are a few things you need to take note of,
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Get a company business bank account, business credit card, and other business accounts to check up on the business expenses and business accounting software if needed.
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File Texas business permits & licenses. For Texas business permits & licenses, we can consider health permits, building permits, and others based on your simple business structure. Besides, look for the details of business licenses, whether you need federal business licenses, and what the fees are for the business licenses you need.
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Get general liability insurance and professional liability insurance with coverage for employees. Companies with employees must get coverage for their employees. There can be many types of business insurance. If you have a simple business structure like an LLC, you can go for basic insurance.
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File a Texas LLC annual report.
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including penalties for failure to file, to make sure your LLC is up-to-date. To avoid penalties or penalty fees, you must renew your LLC on time.
Online filings are generally processed in about 3-5 business days. Mail filings typically take 5-7 business days. Check how long it takes to form an LLC to know about the tentative timelines.
Cost of Starting an LLC in the State of Texas
LLCs can be formed for a very low price. Apart from the mandatory state filing fees, you don't have to bear additional service charges if you do it yourself. The following are the fees and taxes LLCs in Texas must pay to register and run a business in the state. Forming an LLC is no doubt cost-effective compared to other business structures. However, the fees and charges (tax-deductible) that you must pay to the state, such as name reservation fee, name filing fee, LLC filing fee, and Franchise Tax & Sales Tax (If applicable). Here are the main fees and taxes you must pay while forming your limited liability company in Texas.
| Fees/Tax | Amount to be Paid |
|---|---|
| Name Reservation Fee (optional) | $40 |
| Certificate of Formation Fee | $300 |
| Franchise Tax (For Retail & Wholesaler) | 0.375% |
| Franchise Tax (For other than retail & wholesaler) | 0.75% |
| Sales Tax (if applicable) | 6.25% state tax + up to 2% local tax (max 8.25%) |
| Sales tax applies only to businesses selling taxable goods or services and is not an annual LLC fee. |
In Texas, LLC name reservation is not mandatory. You can register your LLC name at the time of registering your LLC. If you wish to hold the name for some time without registering your LLC, then a Name Reservation is needed. It can be renewed by paying $40. Your LLC name will be reserved for an additional 120 days. In some states, Name Reservation is mandatory. Read our guide on LLC costs in Texas for more information.
Texas LLCs do not file an annual report with the Secretary of State. Instead, LLCs must file the required Franchise Tax Report and Public Information Report (PIR) with the Texas Comptroller by May 15 each year. For 2026, the no-tax-due threshold is $2,650,000. LLCs below this threshold must file only the Public Information Report (Form 05-102). A $50 late penalty applies to late filings.
Texas Foreign LLC
If you are interested in forming a Foreign Limited Liability Company in Texas, then you need to file the Certificate of Foreign LLC to the Texas Secretary of State. Foreign LLCs allow you to operate your business in more than one state. Along with the Certificate of Foreign LLC, you need to submit more documents, like the Certificate of Good Standing, etc., to the Texas SOS to form your foreign LLC n Texas. To set up a foreign LLC, you must submit the Application for Registration of a Foreign Limited Liability Company. To know more in detail, check out our guide on Texas Foreign LLC for the process of filing a foreign LLC.
Texas LLCs have different annual compliance process than many other states. Instead of filing an annual report with the Secretary of State, LLCs must file the required Franchise Tax Comptroller by May 15 each year.
Community Property State
In Texas, having an LLC with your wife/spouse brings simplicity and equal profit to both partners. Hence, if you start an LLC in Texas with your spouse, you can create a single-member LLC instead of a partnership or multi-member LLC and still get equal rights in the LLC.
Texas LLC Formation Review
Time needed: 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Texas. Click on the steps in this list to read the full details.
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The first thing you must do is to choose a company name, which should be unique, easy to find, and available in the state.
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In Texas, it is mandatory to select a registered agent for your LLC. Get a professional Registered Agent from LLC formation services to get things done hassle-free.
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Filing a formation certificate is necessary when forming a Limited Liability Company in Texas. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
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An operating agreement is not a strict requirement in Texas but something encouraged when you start an LLC to avoid future conflicts.
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The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity, like a Social Security number, but for a company.
F.A.Qs
Can I file an LLC in Texas by myself?
If you are a resident of Texas, then you can file your LLC by yourself. However, if you're a beginner, it may be worth having a professional rather than doing it yourself to handle legal complexities, paperwork, and other documentation.
What is the cost of forming an LLC in Texas in a year?
Apart from the formation fee of $300 (domestic LLC) and $750 (foreign LLC), LLC costs in Texas include $0 for Annual Reports every year. LLCs are liable to pay sales tax of 6.25% every year.
How long does it take to get an LLC in Texas?
It takes 3 business days to get an LLC in the state of Texas if you file it online. For the mail filing, it takes 5 to 7 business days to get an LLC.
How to renew my LLC in the state of Texas?
below the $2,650,000 no-tax-due threshold must file only the Public Information Report (Form 05-102). A $50 late penalty applies to late filings.
What is the tax structure for an LLC in the state of Texas?
Generally, for LLCs, it is a default tax structure. Once you obtain the EIN, you will get the various tax structure options to select. Sometimes LLCs choose an S Corp to reduce federal tax burdens. Read more on the Texas Classification of LLC Tax.
In Conclusion
When it comes to forming an LLC in Texas, it is much simpler than other business structures. In Texas, starting a small business or a start-up is easy because of its diverse resources. For small budget holders, forming a limited liability company is desirable. The steps explained in this article are generic steps for starting a business in Texas. It is recommended to consult an attorney or industry expert.