Starting a Texas LLC, step-by-step
Starting a Texas LLC costs $308. And it takes 12 days to get an LLC in Texas.
Here are the 5 steps to forming an LLC in Texas:
- Choose an LLC Name
- Select a Registered Agent
- File a Certificate of Formation
- Create an Operating Agreement
- Get an EIN
If you want to form your LLC yourself, follow our free guide below.
If you want someone to take care of it for you, we recommend hiring Northwest Registered Agent
(We recommend Northwest. We've reviewed all the top companies in the industry. And Northwest is our #1 pick for prices, customer support, and address privacy. Check out Northwest vs LegalZoom to learn more.)
How much does it cost to start an LLC in Texas?
It costs $308 to start an LLC in Texas.
And then it costs $25 per year.
What are these fees for?
- The $308 is the filing fee for the Certificate of Formation – the document that creates an LLC.
- The $25 per year is the filing fee for your Annual Report – a mandatory filing that keeps your LLC in good standing.
Pro Tip: Good news, Veterans! If you’re an honorably discharged veteran of the US Armed Forces (including the Texas National Guard), you can get your LLC for free.
Follow the steps on our Free LLC for Texas Veterans page to get proof of your veteran status and request the fee waiver.
To learn more about LLC Costs, see LLC Costs in Texas.
How long does it take to get an LLC in Texas?
If you file your LLC by mail, it will be approved in 4-8 weeks (plus mail time).
But if you file online using SOSDirect, your LLC will be approved in 10-12 business days.
Or, if you file online using SOSUpload, your LLC will be approved in 13-15 business days.
Please see How long does it take to get an LLC in Texas to check for any delays.
Here are the steps to forming an LLC in Texas
1. Search your LLC Name
Search your Texas LLC Name to make sure it’s available in the state.
You need to do this because two businesses in the state can’t have the same legal business entity name.
First, search your business name and compare it to existing business entities in Texas. You can make sure the LLC Name you want is unique from existing businesses using the Taxable Entity Search from the Texas Comptroller.
Second, familiarize yourself with the naming rules in Texas (so your Texas LLC gets approved).
We’ll explain both in more detail here: Texas LLC Name.
2. Choose a Texas Registered Agent
The next step is to choose a Texas Registered Agent.
A Texas Registered Agent is a person or company who accepts legal documents and state notices on behalf of your Texas Limited Liability Company.
Who can be an LLC Registered Agent?
You have 3 options for who can be your LLC’s Registered Agent:
- A friend or family member
- A Registered Agent Service
Texas law requires that all LLC Registered Agents have a physical street address in Texas. PO Boxes aren’t allowed.
And the Registered Agent’s name and address will be listed on public records.
If you don’t have an address in Texas, or you want more privacy, you can hire a Registered Agent Service for your LLC.
We recommend Northwest Registered Agent
Our favorite feature about Northwest is they’ll let you use their office address throughout your LLC filing. This way, you can keep your address off public records.
They’ll also scan any mail sent to your LLC and upload it to your online account.
Northwest has excellent customer service, and they’re who we trust to be our own Registered Agent.
3. File Texas LLC Certificate of Formation
To start an LLC, you need to file the Texas Certificate of Formation.
This gets filed with the Texas Secretary of State.
The Texas Certificate of Formation costs $308 if you file online.
This is a one-time fee to create your LLC.
If you want to file this yourself, see our step-by-step guide: Texas Certificate of Formation.
Or, you can hire a company to do it for you.
4. Create a Texas LLC Operating Agreement
A Texas LLC Operating Agreement serves as a “companion” document to the Certificate of Formation.
The Certificate of Formation creates your LLC, and the Operating Agreement shows who owns the LLC.
Additionally, some banks require an Operating Agreement when you open an LLC bank account.
And having an Operating Agreement will be very helpful if you ever end up in court. Reason being, it helps prove that your LLC is being run properly.
That’s why we recommend that all LLCs have an Operating Agreement – including Single-Member LLCs.
Furthermore, an Operating Agreement is an “internal document“. Meaning, you don’t need to file it with the state or the IRS (Internal Revenue Service). Just keep a copy with your business records.
You can download a free template below.
Then, learn how to fill it out by watching our step-by-step Texas Operating Agreement video.
5. Get an EIN for your LLC
The next step is to get a Texas EIN Number from the IRS for your LLC.
Note: An EIN Number is also called a Federal Tax ID Number or Federal Employer Identification Number.
An EIN Number is used to:
- identify your LLC for tax purposes
- open a business bank account
- apply for business licenses and permits
How much does an EIN cost?
Getting an EIN Number from the IRS is completely free.
How long does it take to get an EIN?
If you apply online, it takes 15 minutes.
If you apply by mail or fax, it can take 1-3 months.
How can I get an EIN?
US Citizens/US Residents: If you have an SSN or ITIN, you can apply for an EIN online. Follow these instructions: Apply for an EIN online.
Non-US Residents: You can’t get an EIN online, but you can still get one by fax or by mail. Follow these instructions: How to get an EIN without an SSN or ITIN.
What do I do after my LLC is approved?
After your Texas LLC is approved, there are some additional steps.
Open an LLC business bank account
You’ll want to open a business bank account for your LLC.
This makes accounting and record-keeping much easier for your business entity finances.
Having a separate business bank account also maintains your personal liability protection. This is because it keeps your business entity finances separate from your personal finances.
Get Texas Business Licenses and Permits
Good news, Texas doesn’t require an individual or business entity to get a state general business license. Meaning, there is no state general business license in Texas.
However, depending on where your LLC is located, you may need a local business license or permit.
For example, if you want to start a daycare, you may need a business license from the city or county.
You can learn more on our Texas Business License page.
File your Franchise Tax Report & Public Information Report
All Texas LLCs must file a Franchise Tax Report and a Public Information Report (PIR) every year.
These filings keep your LLC in good standing with the state.
How much do the Franchise Tax Report and Public Information Report cost?
Both reports are free to file. And your LLC will only owe Franchise Tax if your LLC makes more than $1,230,000 per year.
This means that most LLCs in Texas file the No Tax Due Report.
When the No Tax Due Report is filed online, the Public Information Report is included with it.
When are the Franchise Tax and PIR due?
All LLC Franchise Tax Reports and Public Information Reports are due by May 15, every year.
When are my first Franchise Tax and PIR due?
Your first Annual Report is due the year after your LLC was approved.
For example, if your LLC was approved on March 15, 2024, your first Franchise Tax and PIR is due by May 15, 2025.
How do I file my LLC Franchise Tax and Public Information Report?
You can file both of these documents online or by mail. We recommend the online filing because it’s easier to complete.
Follow our step-by-step guide here: Texas LLC Annual Report.
File and pay taxes
LLCs don’t pay federal income tax. Instead, the LLC Members pay the taxes for the LLC.
Said another way, the owners pay taxes for the LLC as a part of their personal tax return.
How will my LLC be taxed?
By default, a Texas LLC is taxed by the IRS based on the number of owners your LLC has:
- A Single-Member LLC is taxed like a Sole Proprietorship.
- A Multi-Member LLC is taxed like a Partnership.
Alternatively, you can ask the IRS to tax your LLC like a C-Corporation or S-Corporation.
Married Couples: Instead of having your LLC taxed as a Partnership, married couples can elect to be taxed as a Single-Member LLC (aka Qualified Joint Venture). This is allowed in Texas because Texas is a community property state.
Besides federal taxes, there are also state and local taxes – like sales tax. Learn more in Texas LLC Taxes.
How to Start an LLC in Texas FAQs
Can I start an LLC online in Texas?
Yes, you can file your LLC online in Texas. The Certificate of Formation filing fee is $308.
When you start your LLC online using SOSDirect, your LLC filing will be approved in 10-12 business days.
What are the benefits of an LLC?
The first benefit of an LLC is protecting your personal assets. Meaning, if your business is sued, your personal assets – like your home, cars, and bank accounts – are protected.
This protection applies to all LLC owners (called LLC Members). It doesn’t matter if you have a Single-Member LLC or Multi-Member LLC. All of the LLC owners are protected from the business debts and liabilities.
This type of protection wouldn’t apply if you operate as a Sole Proprietorship or Partnership. With these types of informal business structures, the owners aren’t protected in the event of a lawsuit. For that reason, Limited Liability Companies (LLCs) are a much more popular business structure.
Another benefit is LLC pass-through taxation. This means the LLC itself doesn’t pay federal income taxes. Instead, the profits “pass through” to the LLC Members. And the Members pay the taxes on their personal tax return.
To learn more, please see How are LLCs taxed.
Is Texas a good state to start an LLC?
Whether Texas is a good state to start an LLC depends on where you live – and where you’re doing business.
Meaning, if you live in or do business in Texas, then you should start your LLC in Texas. While many websites talk about tax rates and advantages of certain states, none of that applies if it’s not the state where you live and do business.
For example, if you form an LLC in Nevada, but live in and conduct business in Texas, you’ll also need to register your Nevada LLC in Texas (and pay extra fees). And you’ll end up paying Texas taxes anyway. This ends up leading to more costs and more headaches with no advantages.
In summary, if you live in and conduct business in Texas, then yes, Texas is a good state to start a business. If you don’t live in and do business in Texas, then no, Texas isn’t a good state to start a business.
Real estate exception: If you’re purchasing real estate outside of Texas, you should form your LLC in the state where the property is located.
For more information, please see Best State to Form an LLC.
What is the difference between a Domestic LLC, a Foreign LLC, and a PLLC?
The main differences between Domestic LLCs, Foreign LLCs, and Professional LLCs are where they are formed and their business purpose.
A Domestic Limited Liability Company is an LLC that is formed in its “home state”, meaning, where the business owner lives and does business.
For example, if you live in and do business in Texas, you would form your Domestic LLC in Texas.
A Foreign Limited Liability Company is an LLC that is formed in a state that isn’t its home state. In this case, the term “foreign” simply means that the LLC is foreign to its “home state”.
For example, if you live in and do business in Texas, you would form your Domestic LLC in Texas. If you later expand into New Mexico, you would register your existing Texas LLC as a Foreign LLC in New Mexico.
Said another way, LLCs are created at the state-level.
So if you want your LLC to do business in two separate states, you have to form or register an LLC in both states.
This works by forming a Domestic LLC in your home state, and a Foreign LLC in the other state.
What is a PLLC?
A Professional Limited Liability Company (PLLC) is a type of LLC formed for the purpose of providing “professional services”.
In this case, “professional” refers to business types that require special permissions (like a license, registration, or certification from the state) in order to do business legally.
For example, architects, attorneys, and social work counselors, doctors, and veterinarians often form their business practices as PLLCs.
You can read more about PLLCs, their availability, and their stricter requirements in: What’s a Professional LLC?
And for more information on Foreign and Domestic LLCs, please see:
Matt holds a Bachelor's Degree in business from Drexel University with a concentration in business law. He performs extensive research and analysis to convert state laws into simple instructions anyone can follow to form their LLC - all for free! Read more about Matt Horwitz and LLC University.