The Definitive Guide To Setting Up An LLC In Texas

Here is the step by step guide that you need to take to form a Texas limited liability company ( LLC). See our article for more information on how to build an LLC in any State.

Step 1: Create A Texas LLC Name

First off, to form an LLC in Texas, you have to give it a title. Your business title needs to be for branding purposes, catchy, and legitimate for lawful purposes. We move into depth on this topic in our LLC naming guide, but we will go over the legal basics below.

Legally, your business name needs to:

• Contain the words Limited Liability Company or Limited Company or LLC or LLC for short.

• Not contain the words bank, bank, and trust, confidence, trust company, or a similar name or foreign language word without approval from the state bank commissioner.

• Not contain the words college, school, faculty of medicine, medical school, health science centre, college of law enforcement centre, or law school with no approval by the Texas Higher Education Coordinating Board.

• Not contain the words veteran, legion, Spanish, foreign, disabled, war, or world war when the name suggests that the entity is created for the sake of war veterans and their families, with no written consent issued by a veterans organization.

Step 2: Select Your Registered Texas Agent

When you file your Certificate of Formation, you will have to appoint a Texas agent. Your registered agent can be an individual resident of the state or a company that is legally authorized to represent companies.

A lot of business owners choose to appoint a professional, although Texas does give you a choice to act as your registered agent. Listed below are a few things to consider before you decide to act as your registered agent:

• Should you operate your business in the home, you'll be required to create your address public.

• It would help if you kept up on important notices, dates, and deadlines.

• You could be served before your loved ones or colleagues.

Step 3: File Your Texas LLC Formation Certificate

Now it is time to form your Texas LLC officially by submitting your Formation Certificate with the Secretary of State. You can do this on your own, with a lawyer's support, or with a qualified LLC filing service.

You can handle this step yourself, but we still recommend that you consider the help of an LLC training service. Why? For what? They will not only take the reins and ensure

that you properly file everything, but they will also provide other necessary products and services at very competitive prices.

Step 4: Create Operating Agreement With Texas LLC

Developing a Texas LLC operating agreement is the only way for you and your associates to fully define your roles and lock off your LLC's direction and ownership arrangement.

With this document in place will also give you all something to if a lawsuit or a dispute arises to return.

Your operating agreement should summarize the following:

• Every member's duties

• The way new members will be admitted

• How to present members may transfer or terminate their membership

• How profits and dividends are to be distributed

From that point, you can add as many provisions as you want, provided they are not in conflict with Texas law. Please take a look at our What's an Operating Agreement manual to learn more.

Step 5: Get Your Texas LLC An EIN

The EIN is basically a Social Security number for your company.

National and state agencies use this number to keep track of your organization's action.

It will come in helpful when it's time to:

• Open a business bank accounts

• File Federal and State taxes

• Hire employees

We think the best way to get an EIN to your LLC in Texas is by using the free online application on the IRS site. We like this method because it is the most efficient, but you can apply by facsimile, phone, or mail.