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How much does it cost
to form an LLC in Texas?
How to form an LLC in Texas
This Quick Start Guide is a brief overview of how to form an LLC in Texas.
Texas LLC costs:
State filing fee: $300
Annual franchise tax: $0 (for most LLCs)
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Costs to setting up a Texas LLC
To form an LLC in Texas, you have to file a document called the Certificate of Formation with the Texas Secretary of State. The filing fee is $300.
It takes 2-3 business days if you file the Certificate of Formation online, and 7-10 business days if you file by mail.
But that’s just the filing fee for the Certificate of Formation. There are a few other costs you have to consider when forming an LLC in Texas.
Note: For instructions on how to form an LLC in Texas, please use the links at the top of this page.
The table below shows all the fees for forming an LLC in Texas.
Texas LLC Costs:
|Registered Agent||$0 or $125 (per year)|
|Certificate of Formation||$300|
|Operating Agreement||$0 (free on our site)|
|EIN Number||$0 (free from IRS)|
|Franchise Tax Reports||$0 (for most LLCs)|
|Taxes||Varies (paid each year)|
Texas LLC Name ($0)
Naming your Texas LLC won’t cost you anything. The Texas Secretary of State doesn’t require you to file a Name Reservation or anything like that. You can actually call or email the state before filing your Certificate of Formation to check if your desired name is available.
Once you have that taken care of, you can just enter enter your Texas LLC name in the Certificate of Formation. Then the Secretary of State reviews your filing and approves your LLC name. Either way, there are no costs associated with naming your Texas LLC.
Texas Registered Agent ($0 or $125/year)
Texas law requires that you designate a Registered Agent when forming your LLC.
A Registered Agent is a person or company who receives legal documents (called “Service of Process”) if your LLC is involved in a legal proceeding.
There is no additional cost if you (or someone you know) will be your LLC’s Registered Agent. However, if you need to hire a Commercial Registered Agent, that will cost you about $125 per year.
Hiring a Commercial Registered Agent is a good idea if:
- you don’t have an address in the state (Texas law requires a Registered Agent to have a physical address in the state)
- you want to maintain your privacy by keeping your address off public records
Texas LLC Certificate of Formation ($300)
You need to file a Certificate of Formation in order to create an LLC in Texas. The Certificate of Formation can be filed by mail or online. The fee for a mail filing is $300 and the fee for an online filing is $308.
The filing fee is a one-time fee. You don’t have to pay any monthly (or annual) fees to maintain your Texas LLC.
We recommend filing your Certificate of Formation online as it’s much easier and approval time is faster.
LLC approval: After approving your LLC, the Texas Secretary of State will send you a Welcome Letter, Certificate of Filing, and a stamped and approved copy of the Certificate of Formation.
Texas LLC Operating Agreement ($0)
Most websites charge $50 – $200 for an LLC Operating Agreement.
Here at LLC University®, we offer free Operating Agreement templates both for Member-Managed Texas LLCs and Manager-Managed LLCs that you can download.
EIN Number for a Texas LLC ($0)
An EIN Number is also known as an Employer Identification Number (EIN) or a Federal Tax ID Number (FEIN). They all mean the same thing.
Although many websites charge a service fee to help you get an EIN for your LLC, it’s actually free. You can obtain an EIN for your LLC from the IRS at no cost.
We have step-by-step instructions on how to get an EIN for your Texas LLC.
Note: Your EIN is a different number from the 11-digit “Taxpayer Number” which you’ll get from the Texas Comptroller (after you register for franchise tax).
Texas LLC Franchise Tax Report (usually $0)
Over 90% of LLCs don’t have to pay a franchise tax with the Texas Comptroller’s Office. They still have to file though.
Most of our readers just file a No Tax Due Report (if total revenue is below the threshold) as well as a Public Information Report (PIR). It doesn’t cost anything to file these reports.
For established businesses in the state that have to pay franchise tax, the rates are as follows:
- 0.375% of an LLC’s taxable margin (for retailers and wholesalers)
- 0.75% of an LLC’s taxable margin (for all other businesses; and those that don’t use the EZ computation method)
- 0.331% of total revenue (if the LLC is eligible for, and elects, the EZ computation method)
Texas LLC Public Information Report ($0)
In addition to filing a franchise tax report, all LLCs in Texas have to file a Public Information Report (PIR) each year.
There is no cost to this.
The PIR is due at the same time as your LLC’s franchise tax reports; by May 15th. The first PIR is not due until the year after your LLC is formed.
Note: If you properly formed a Texas veteran LLC, you don’t have to file a Public Information Report. You still have to file a No Tax Due Report though.
Texas LLC Taxes (varies)
There are many different types of taxes that LLC owners must pay. Federal income tax, state taxes, payroll tax (if your LLC has employees), and more.
What kind of taxes and how much you’ll have to pay can be determined by working with a qualified accountant in Texas.
The amount you’ll pay your accountant will vary, but most small business owners pay their accountant between $400 to $900 per year.
Do I need to hire an attorney to form an LLC?
You are not required to hire an attorney to form your LLC in Texas (although you certainly can if you want to).
An attorney usually charges between $800 to $2,500 to form your Texas LLC. Their fee may be in addition to the $300 state filing fee.
You can save a lot of money if you form your LLC yourself. You can follow our free Texas LLC lessons to help you form your LLC (links are at the top of this page).
Should I hire an LLC filing company?
An LLC filing usually charges $40 to $400, depending on the company.
Texas LLC Filing Cost
The total Texas LLC formation costs (the cost to create the LLC) is $300. These are the only amounts you have to pay if you file the Certificate of Formation yourself.
Texas LLC Annual/Recurring Costs
Depending on the income it earns, your LLC may be liable to pay a franchise tax (as well as other taxes) to the Texas Comptroller.
However, keep in mind that over 90% of LLCs just file franchise tax reports, but don’t pay a franchise tax.
Hiring a Registered Agent company will cost you about $125 per year.
And of course there’s taxes, which include the amount you pay in taxes and how much you pay your accountant for their services. This will vary quite a bit and we’re not able to provide an estimate. You’ll need to speak to a few accountants regarding your business.