Texas LLC

What is a Texas LLC?

A Texas LLC is formed by filing a Certificate of Formation with the Secretary of State and paying the appropriate filing fee. A Texas LLC is governed by its Operating Agreement, which is written and agreed upon by its members, and which lays out the management structure of the company. Each member offers a capital contribution in return for an ownership percentage.

Learn more below about the structure of a Texas LLC and how one is formed.

Texas LLC Requirements

1. Texas LLC Certificate of Formation.
2. State Filing Fee of $300.
3. A Registered Agent located in Texas. See our service here.
4. Beneficial Ownership Information Report filing. Your report must be submitted after company formation starting January 1, 2024.

Texas LLC Structure

TX Limited Liability Companies are structured legally with the Texas Articles of Organization for a Limited Liability Company. Like many states, the document for an LLC is short and simple.

The required information to be listed:

• Name
• Registered Agent
• Management
• Organizer
• Date

Name

When filing an LLC in Texas, you will be required to use the words “Limited Liability Company”, “Limited Company” or an abbreviation of those words such as “LLC”.

Registered Agent

The Registered Agent company name will be listed, this information will contain the address registered with the state.

Management

You will list the Managers or Members along with their addresses according to how the LLC is managed.

Organizer

The name and address of the Organizer is to be produced before filing can take place for a TX LLC.

Date

You may have the LLC become effective on the date it is received for processing or at a later date to be scheduled.

Texas LLC Filing

Steps to Form an LLC in Texas

1. Naming the LLC: The first step to form an LLC is selecting a name. Texas Administrative Code Title 1, Part 4, Chapter 79, Subchapter C lays out the legal guidelines for entity name selection.
2. Filing the Certificate of Formation: To form an LLC in Texas, you file a Certificate of Formation with the Secretary of State. There is a $300 filing fee. The Certificate can be filed online.
3. Appointing a Registered Agent: A limited liability company is required to appoint a registered agent within the state. An LLC cannot represent itself as a registered agent.
4. Writing the Operating Agreement: After you form an LLC, an operating agreement should be written to outline the ownership of the company and how the LLC will operate. Operating agreements address membership, membership percentages and rights, management structure, and major company policy.
5. Opening Business Bank Accounts: Business accounts should be opened in order to keep business money separate from the personal accounts of members.
6. Filing Annual Franchise Tax Report: Every year after you form an LLC, your business must file a Franchise Tax Report. The report is due by May 15 each year. The tax owed is variable depending upon the business and the amount of revenue.
7. Submitting Beneficial Ownership Information Report: You must a file a BOI report with the Financial Crimes Enforcement Network after formation, starting January 1, 2024. The BOI report is free to file and must be submitted online.

Benefits of the Texas LLC

1. Major State Economy: Texas supports one of the largest economies in the country. 54 of the Fortune 500 Companies are located in Texas, and the state employs a 13 million member labor force. Texas’s economy is literally larger than Russia’s. Your Texas LLC will be right in the middle of one of the most diverse and thriving business centers in the nation.
2. Low-Tax State: A major advantage of forming a Texas LLC is that Texas does not have a personal income tax. Texas LLCs do not pay an entity level tax (corporations, however, do). Instead, LLC members account for taxes on their personal returns, but with no personal income tax, the members are able to pocket all of their profits.
3. Fair Business Law Reform: Texas has spent much of the last decade making serious reforms to its business laws, including a major $3.8 billion tax relief package passed in 2015. Other reforms include the ability for judges to immediately dismiss frivolous lawsuits brought against businesses, the adoption of a significant Research and Development Tax Credit, and sizable new investments in the education system in Texas to help supply the next generation with the skills that Texas businesses will need to continue to be successful.

Texas Registered Agent

A Texas registered agent must continually maintain a physical street address where service of process and certified business mail can be accepted on behalf of clients. This address is known as a registered office. All documents must be forwarded to clients in a timely manner.

A business entity cannot act as its own registered agent in Texas.

Federal Beneficial Ownership Information Report Filing

As a newly-formed LLC, you’ll probably need to submit a Beneficial Ownership Information (BOI) Report to the Financial Crimes Enforcement Network (FinCEN). The BOI report provides the federal government with basic information about your LLC and the people with the most power over your business decisions and profits. Starting January 1, 2024, this report is due following company formation. This report is a little complicated, but we can make filing painless with our $25 BOI report filing service.

Texas LLC Operating Agreement

A Texas LLC Operating Agreement should address (at least) the following:

• Initial Members and Membership Percentages
• Membership Rights and Responsibilities
• Voting Rights of Members
• Buy-In and Sell-Out Rules and Procedures
• Management Structure
• Rights and Responsibilities of Managers (if applicable)
• Annual Meeting Time, Location and Procedures
• Amendment Process

How Do I Calculate My Franchise Tax?

Your business is required to file a Franchise Tax Report each year by May 15. The tax varies depending upon the business and the revenue generated during the fiscal year. The cost of goods sold and employee wages, compensation and benefits can be deducted.

The Texas Comptroller provides an online calculator to determine net tax due.

Am I Required to List the Names and Addresses of My Members and Managers on the Certificate of Formation?

The Certificate of Formation requires you to select whether your LLC will be member managed or manager managed. If the LLC has managers, the names and addresses of the initial managers must be listed. If there are no managers, the name and address of the initial members must be listed.

What Do I Need to Set Up a Business Bank Account for My LLC?

You will need to set up business accounts in order to keep separate the finances of your LLC from the finances of your members. Each bank has its own requirements and procedures for opening accounts. You will need to call or visit the bank where you intend to open an account. Most banks require copies of the Certificate of Formation and the LLC’s operating agreement.

Why Hire Corporate Filing Solutions to Form Your Texas LLC?

Starting your LLC in Texas shouldn’t be a hassle or a time consumer. That’s why we offer Filings Made Easy™ to make starting an LLC in Texas super easy.

Hire us and relax while our filing experts form your new Texas LLC. Our staff will process orders the same business day as they are received. To make things even easier, we bundle the first year of Registered Agent service and ensure your Texas LLC comes fully equipped and ready to do its job.

Start your LLC in Texas and get Registered Agent service for as low as $55 a year.