Start a Texas LLC
Protect Your Privacy & Wallet with an LLC
Starting an LLC in Texas can help you protect your assets and your privacy. With low taxes and a large, thriving economy, Texas makes a great home base for your LLC.
Our step-by-step guide shows you how to set up your LLC and maintain it for years to come. From filing your Certificate of Formation to licenses, taxes, and more, we’ll explain everything you need to know.
Prefer to have an expert create your LLC? Hire us and enjoy the most affordable registered agent service in the Lone Star State—just $25 a year.
LLC Formation Service
$435 TOTAL*
- Fast Certificate of Formation filing
- Year of Registered Agent Service
- Free use of our business address for privacy
- Compliance Renewal Service enrollment
- Secure online account for document storage
- Same-day scans & instant notifications
- Attorney-drafted LLC operating agreement
- Lifetime local customer support
- Easily add services in your client account
*Includes state fees
DIY Guide to Forming an LLC in Texas
As the second largest economy in the United States, Texas is an excellent place to start your LLC.
The main steps to start an LLC in Texas are…
- Choose a business name
- Appoint a Texas registered agent
- File the Certificate of Formation with the Texas Secretary of State
- Create an LLC operating agreement
Below, we explain how to complete each of these steps.
1. Choose a Business Name
First, you need to choose an LLC name that will be accepted by the Secretary of State. According to TX Bus Orgs § 5.053, your LLC name must be distinguishable from (meaning not the same as or very similar to) any other registered business name in the state, including:
- Domestic business entities in Texas
- Foreign business entities registered to do business in Texas
- Fictitious business name of a foreign LLC or foreign corporation in Texas
- Business name reserved with the Secretary of State
- Name of a registered series of a Texas LLC
Your LLC also needs to include the words “limited liability company,” “limited company,” or an abbreviation thereof, such as “LLC.”
You can check whether a name is available by using the Texas Comptroller’s Franchise Tax Account Search. You can also call or email the Secretary of State and ask for a preliminary name check.
While it’s not required, you can reserve your business name for 120 days by filing an Application for Reservation of an Entity Name ($40 filing fee) with the SOS. This will prevent another business from taking your name while you’re getting ready to form your LLC.
You can file your name reservation by mail, fax, or online through SOSDirect.
An assumed name, also called a trade name or a DBA “doing business as” name, is any business name you operate under that isn’t your registered business name. For example, if your business name is Topaz Home Furnishings LLC but you advertise under the name “Topaz Furnishings,” “Topaz Furnishings” would be a DBA.
Using a DBA can help you to create multiple brands without needing to create multiple LLCs. For example, you could register “Topaz Furnishings,” “Topaz Fashion,” and “Topaz Art & Decor” as DBAs, without needing to change your official LLC name.
To legally use a DBA in Texas, you first need to file an Assumed Name Certificate with the Secretary of State, which you can do by mail, fax, or through SOSDirect. There’s a $25 filing fee. You’ll need to file a separate certificate and pay a separate fee for each DBA you want to use.
Note that registering an assumed name doesn’t give you legal rights to the name or prevent others from registering the same name.
A domain name is the address for a website. For example, our domain is texasvirtualoffice.com. Having a domain name that matches your business name makes it easier for potential customers to look you up online.
Even if you’re not planning to create a business website right away, consider reserving a domain name before or immediately after you form your LLC. That way, you can make sure your domain name and LLC name match (or complement each other).
2. Appoint a Registered Agent
The law requires each Texas LLC to appoint and maintain a registered agent. (TX Bus Orgs § 5.201 (2024)). Your registered agent can be an individual or a company that provides registered agent service, but they must be located in Texas.
Your Texas registered agent is required to:
- Have a physical street address in Texas (their registered office), which will go on the public record.
- Be physically present at their registered office during normal business hours.
- Accept legal and state documents on behalf of a business, including service of process (lawsuits) and notices from the Secretary of State.
- Forward legal and state documents promptly and confidentially to the business they serve.
Since a registered agent must put their address on the public record and be available during business hours to accept service of process, many businesses hire a professional registered agent service to perform this role.
As the business owner, you can appoint yourself as the registered agent for your business. However, if you do this, your address will be visible in public databases, and you will be expected to be present at this address during normal business hours, year round.
Why hire a registered agent service?
Privacy
Many small business owners work out of their homes, rather than a traditional storefront or office. For that reason, they often end up using their home address as their registered office, not realizing this address will be easily searchable online.
When you hire a registered agent service, their address will go on the public record instead of yours. With our registered agent service, we allow you to use our business address in all address fields, so you can maintain your privacy.
Professional Reputation
If your business is ever served with a lawsuit, it’s much better to receive this notice privately, rather than in front of your customers or neighbors. Getting served at your home or your place of work can be embarrassing and even ruin your professional reputation.
A good registered agent service will forward your state and legal notices to a secure online account, where you can review them in private.
Convenience
A registered agent is required to be at their office during regular business hours, 52 weeks a year. This can be challenging (if not impossible) for business owners who work nontraditional hours or need to travel for work.
When you hire a registered agent service, you won’t have to stress about missing an important notice because you were out of the office. You’ll be able to view your legal documents on your own time, wherever you are.
3. File Your Certificate of Formation
When you’re ready to start your LLC, you’ll need to file a Certificate of Formation with the TX Secretary of State and pay the $300 state fee (add a 2.7% convenience fee if filing online).
To complete the Certificate of Formation, you’ll need the following information:
- LLC name
- Principal business address (must be a physical street address)
- Mailing address
- Registered agent and registered office
- Management structure: member-managed (managed by owners) or manager-managed (managed by hired managers)
- Names and addresses of managers or managing members
- The name and address of your organizer (the person filing your Certificate of Formation)
- Any optional provisions you’d like to add
- Whether your Certificate of Formation will take effect when the document is filed or at a later date (most businesses choose “when the document is filed”)
Note that the names and addresses you include on your Certificate will go on the public record.
Your Certificate can be filed by mail, in person, or online. If submitting by mail or in person, you should submit the form in duplicate.
By mail:
Secretary of State
P.O. Box 13697
Austin, TX 78711
In person:
James Earl Rudder Office Building
1019 Brazos
Austin, Texas 78701
Online:
SOSDirect
Once the state has approved your Certificate, they’ll mail you a file-stamped copy of the document. If you file online, you’ll be emailed a confirmation.
The state filing fee for the Certificate of Formation is $300 (plus a 2.7% credit card fee).
4. Create an LLC Operating Agreement
Creating a strong operating agreement (also called a company agreement) can help your LLC stay organized and avoid conflict down the road. This internal document should include each owner’s membership interest, rights, and responsibilities. The operating agreement also establishes the LLC’s voting process and how changes can be made, among other things.
While adopting an operating agreement isn’t legally required in Texas, it’s highly recommended.
Why do I need an operating agreement?
To resolve conflicts between members
For LLCs with multiple members, it’s crucial to put things like ownership, voting procedures, and your management structure in writing. That way, when disagreements arise, you can consult this document to know how to proceed. A strong operating agreement that all members understand and agree to may even help you avoid a court battle down the road.
To have autonomy over your LLC
According to TX Bus Orgs. § 101.052, any matters that are not covered in an operating agreement will be governed by Texas’ default laws for LLCs. Having an operating agreement allows you to waive or modify default laws to make them work for your LLC. For example, your LLC can establish the voting powers of each member of your LLC.
To reinforce your limited liability status
In order to maintain your company’s limited liability protection, your LLC assets and interests must be kept separate from the individual owners’ assets and interests. Following your operating agreement, which should cover how you’ll handle profits, losses, and distributions, helps you keep your LLC activities above board.
If your LLC should ever end up in court, being able to show that you’ve followed your operating agreement can reinforce your limited liability status, so that individual owners’ assets will be protected.
Your operating agreement can include whatever rules and procedures you want, as long as they don’t contradict the law or your Certificate of Formation.
At the minimum, your operating agreement should include the following:
- Ownership information, including members’ names, addresses, and initial contributions
- How to add and remove members
- How profits and losses will be distributed
- Whether your LLC is member- or manager-managed
- Voting rights and procedures
- How managers will be hired and compensated
- Bookkeeping procedures
- How to make amendments to your Certificate of Formation or operating agreement
- Process for merging or dissolving the company
Note: An LLC operating agreement is a legally binding document, so you want to take care before finalizing this document. It’s a good idea to have an attorney draft or review your operating agreement.
When you hire us to form your LLC, we’ll send you an attorney-drafted operating agreement template tailored to your LLC type.
You can draft your own agreement, hire someone to write it for you, or use a template. Having a lawyer draft your operating agreement from scratch can be expensive, but it is a good idea to have an attorney review your agreement.
Get a Free Operating Agreement with Your LLC Formation
Next Steps
After the Secretary of State approves your Certificate of Formation, you officially have an LLC. However, there are a few more steps to take before you can start doing business.
1. Get an Employer Identification Number (EIN) from the IRS
An EIN, also called a Federal Employer Identification Number (FEIN), is a tax identification number that most LLCs need. Multi-member LLCs and all businesses with employees are required to have an EIN.
Even if you’re not required to get an EIN, you might want one in order to avoid giving out your social security number to vendors and business partners. Also, some banks require an EIN to open a business bank account or apply for a small business loan.
The easiest way to get an EIN is online. You can apply for free within a few minutes on the IRS website. If no one in your LLC has a social security number, you’ll need to apply by phone, fax, or mail.
2. Open a business bank account
It’s crucial that your LLC has its own bank account, so that you can keep LLC finances separate from your personal finances. If you mix LLC and personal money, you could be accused of “piercing the corporate veil,” which could jeopardize your limited liability status.
When looking for a place to open a business bank account, there are a few things to look for:
- High interest rates (APY) for savings and checking
- Low interest rates (APR) for lines of credit
- Low minimum account balance and transaction fees
- Low or no monthly or annual fees
It’s a good idea to call the bank ahead of time to see what documents they require for opening a business account. Typically, you’ll need to bring your EIN, Certificate of Formation, operating agreement, photo ID, and a Resolution to Open a Bank Account (for multi-member LLCs).
3. Obtain all required business licenses and permits
Texas doesn’t have a general business license at the state level, but most businesses need some sort of license or permit. You’ll need to research the licensing requirements in your city or county, as well as the requirements for your industry.
If you’re in a field that requires specific training, such as cosmetology, elevator safety, or property tax consulting, among many others, you’ll most likely need a professional license from the TX Department of Licensing and Regulation.
Many cities and counties in Texas have their own licenses and permits, which also vary by industry. For example, to sell alcohol in Austin, you’ll need an Austin Alcoholic Beverage Permit as well as a state license from the Texas Alcoholic Beverage Commission.
To learn more about Texas business licensing requirements, check out the Texas Business Licenses and Permits Guide (2024-2025).
4. Purchase business insurance
Depending on your industry and the level of risk you’re comfortable with, you may need some form of insurance. Common types of business insurance include:
- General liability insurance. Required in some industries.
- Business owner’s policy (BOP). Combined general liability and property insurance.
- Commercial auto insurance. Needed if you use your vehicle for business purposes.
Some fields require specialized insurance, such as malpractice insurance for medical clinics.
Workers’ compensation insurance isn’t required for private employers in Texas, except when contracting with government agencies. However, workers’ comp can supplement your employees’ lost wages and medical expenses if they’re injured on the job, so it’s worth considering. Plus, having workers’ compensation insurance protects you from being sued by an injured employee.
Maintaining Your LLC
File the Public Information Report
Unfortunately, an LLC isn’t a “set-it-and-forget it” kind of thing. You’ll need to renew your LLC each year by filing a Public Information Report with the Texas Comptroller. This report ensures that your address, registered agent information, and members/managers are up to date. You may also need to file a Franchise Tax Report. However, as of 2026, only businesses making over $2.65 million in annual revenue need to file the Texas Franchise Tax Report.
The Franchise Tax Report and Public Information Report are both due on May 15th each year (or on the following business day, if May 15th falls on a weekend or holiday). There is no fee to file these reports (other than any franchise tax you may owe).
What happens if I don’t file the Public Information Report?
If you don’t file your Public Information Report, your business will be considered inactive. Eventually, your business will be dissolved by the state. To reinstate your business, you’ll need to file any past due reports, along with a Tax Clearance Letter for Reinstatement.
Better to stay on top of your reports and keep your LLC in good standing!
Keep Your Business in Good Standing
Without Lifting a Finger
When you hire us for LLC formation or registered agent service, you’ll be enrolled in our Renewal Service at no upfront cost.
We’ll send you a reminder far in advance of your Public Information Report/Franchise Tax Report due date. Then we’ll file your report(s) for you for $100 (charged at the time of filing). If you prefer to file on your own, simply cancel Renewal Service in your online account.
With Renewal Service, your Public Information Report gets filed on time every year without you even having to think about it, and you won’t have to worry about your business becoming inactive and needing to be reinstated.
File Tax Returns
Texas business owners are fortunate in that Texas doesn’t have an individual or corporate income tax. Texas does have a Franchise Tax, but starting in 2026, only businesses making over $2.65 million a year need to pay anything.
Even so, you should be aware of state, local, and federal taxes your LLC may be responsible for. We recommend consulting a tax professional for specific advice, but here are the basics of filing taxes in Texas.
Federal taxes
By default, LLCs are taxed as “pass-through” entities, which means the LLC itself isn’t taxed. Instead, profits and losses “pass through” the business to the individual members. The members then pay personal income tax on their share of the profits.
LLCs can also elect to be taxed as an S-corp (IRS Form 2553) or a C-corp (IRS Form 8832). Consult a tax attorney or CPA if you’re interested in changing your tax status.
State taxes
Anyone doing business in Texas needs to apply for a Sales Tax Permit from the Texas Comptroller. The state sales tax is currently 6.25%. If your business makes over $2.65 million in annual revenue, you’ll also need to pay a Franchise Tax.
Local taxes
Cities and counties in Texas can impose a local sales tax of up to 2%, bringing the total sales tax up to 8.25% in some areas. You may need to pay additional local taxes, such as property taxes. Reach out to your local government office to find out exactly what taxes you’ll need to pay.
Why Start an LLC?
Here’s why starting an LLC is a great choice for small businesses
Liability Protection
An LLC is considered a distinct legal entity, separate from its owners. So, if your LLC is sued or defaults on a debt, the owners’ personal assets are typically off-limits. However, it’s important you maintain your limited liability status by keeping LLC finances separate and following your operating agreement.
Flexible Structure
Unlike corporations, which have a rigid structure, LLCs can be organized and managed in many ways. You can choose whether the LLC members will manage the LLC (member-managed) or whether you’ll hire outside managers (manager-managed). An LLC can also have one owner or multiple.
No Double Taxation
Corporations must pay federal corporate income tax, which is currently 21%. The owners of a corporation must also pay personal income tax on their earnings. This is called “double taxation.” LLCs, on the other hand, don’t need to pay corporate income tax, so your profits will only be taxed once.
Types of LLCs
One of the great things about LLCs is their flexibility. With an LLC, you can have one owner or multiple. You can manage your LLC yourself or hire an outside person to manage it for you. Let’s break down the different types of LLCs.
Single-Member LLC
As you might guess, a single-member LLC has only one member (owner). Even though it’s owned by a single person, it’s still considered a separate legal entity and protects the owner’s personal assets. Just be sure to follow your operating agreement and keep your LLC finances separate to avoid piercing the corporate veil.
Multi-Member LLC:
A multi-member LLC is simply an LLC with more than one member (owner). There’s no limit to the number of members an LLC can have. However, the more owners your LLC has, the more important it is to have a strong operating agreement that everyone understands and agrees to follow.
Member-Managed LLC:
A member-managed LLC is managed by one or more of the LLC’s owners. You’ll need to designate whether your LLC is “member-managed” or “manager-managed” on your Certificate of Formation. Your members’ names and addresses must be listed on the form.
Manager-Managed LLC:
In a manager-managed LLC, the LLC members appoint an outside person (or people) to manage the LLC for them. If you have a manager-managed LLC, your managers’ names and addresses will be listed on the Certificate of Formation.
Foreign LLC
A Texas foreign LLC is any LLC that was formed outside the state of Texas. If you have a foreign LLC but want to do business in Texas, you’ll first need to file an Application for Registration of a Foreign Limited Liability Company and pay $750 to the TX Secretary of State. Foreign LLCs in Texas need to file a Public Information Report and are subject to Texas Franchise Tax and other state and local taxes, just like domestic Texas LLCs.
PLLC (Professional Limited Liability Company)
A PLLC is an LLC owned and managed by licensed professionals, such as doctors, dentists, veterinarians, or attorneys. If you’re in a licensed profession, you’ll most likely be required to start a PLLC rather than a traditional LLC. Like regular LLCs, PLLCs have limited liability protection that shields the owners’ personal assets in case of a lawsuit, but they have greater restrictions and oversight than other LLCs. To form a PLLC in Texas, you’ll need to file the Certificate of Formation—Professional Liability Company and pay $300 to the TX Secretary of State.
Texas LLC FAQ
The filing fee to form a Texas LLC is $300. However, you may need to pay additional fees for business licenses and permits.
That depends. Do you want your personal assets to be protected if your business is sued or goes into debt? If you do, then forming an LLC is probably a good idea.
On the other hand, if your business is low-risk and/or just starting out, you might be fine operating as a sole proprietor or general partnership. Just realize that as a sole proprietor/general partner, you are your business. Any liabilities against the business will be legally considered your personal responsibility.
You won’t need to get a general business license to operate in Texas. However, you will most likely need a Sales and Use Permit. Depending on your industry and the type of business you own, you may need additional licenses or permits, such as a license to practice medicine or law, a cosmetology license, or a liquor license.
It’s also a good idea to reach out to your city or county government to learn about their licensing or permitting requirements.
Your registered agent address must be a physical street address in Texas, not a PO box. However, a PO box is acceptable for your initial mailing address and the addresses of your members/managers.
Your operating agreement should have a process for removing an LLC member and redistributing their membership interest. In most cases, LLC members will need to vote to remove a member.
Your operating agreement should have a plan for terminating your LLC, should you ever need to. Before terminating your LLC, you’ll need to wind up your affairs by distributing LLC assets and settling any debts and legal obligations. To officially terminate your LLC with the state, you need to file a Certificate of Termination ($40 filing fee).
Quick. Easy. Affordable.
Order LLC Formation Service for $435 total.*
*Includes state fees