When you pick a name for your Texas Corporation, it should include any of these words: ‘Corporation’, ‘Incorporated’, ‘Company’, or ‘Limited’. Alternatively, these abbreviations can also be used: ‘Corp.,’, ‘Inc.,’, ‘Co.,’, or ‘Ltd’. The name should also be distinguishably unique and does not bear any resemblance to any reserved or registered name in the Secretary of State database.
To verify the name availability, this can be checked using SOSDirect. If available, a Name Reservation can be filed to the Texas Secretary of State valid for 120 days’ reservation. This can be filed online through SOSDirect or through postal mail. A filing fee of $40 should be enclosed.
A Texas Corporation is legally registered by filing a Certificate of Formation for Profit Corporation with the Secretary of State of Texas. The following information is required upon filing the certificate:
The Certificate of Formation for Profit Corporation can be filed through SOSDirect or via mail. A filing fee of $300 should be paid.
A Texas Registered Agent is a requirement before your incorporation as a Texas Corporation is approved. There are some statutory requirements that must be observed when hiring for this position: a Registered Agent can be an individual resident of Texas or a business entity in Texas. A physical street address in Texas must also be provided by the Registered Agent.
A Registered Agent service could cost you up to $160 per year, but if you form a Texas Corporation through IncFile, you can get a Registered Agent service free of charge.
A Corporate Records Book is a vital document keeper that is necessary for your Texas Corporation. This file organizer is where you can store copies of your Certificate of Formation, business licenses and permits, business tax returns and reports, and more.
Although not a mandatory requirement, having a fixed storage folder where you can place all vital corporate documents. You can get a Corporate Records book in the nearest office and school supply chain shop in your area or order through Amazon.
An initial set of corporate directors should be elected by the incorporator. These directors will serve the Corporation until the first annual shareholder’s meeting is concluded.
The incorporator must then create an Incorporator’s Statement, outlining each of the name and address of the directors, then signed by the incorporator and filed in the Corporate Records Book.
As soon as the initial directors are elected, the first meeting should be immediately scheduled. At this meeting, the following agenda is discussed:
All issues discussed in the meeting should be recorded in the minutes of the meeting and signed by all the Corporation’s directors.
Now that you are legally recognized as a Texas Corporation, it is vital that you adhere to business tax and license requirements imposed by the State of Texas. These requirements are responsibilities that must be strictly complied. To jumpstart with the process of taking care of these deliverables, follow these steps:
1) Request for a federal Employer Identification Number through the IRS website.
2) For S Corporation status election, file Form 2553. This form also needs to be signed by all of the Corporation shareholders. Check this section of the IRS for more information on S Corporations.
3) For business licenses and permits, adherence to each of the requirements is a must. To gather all these licenses and permits, you can let a professional service take care of it for you. This is a great package to start off. Alternatively, this SBA resource guide can also be used.
Just as you need to separate personal and business life apart, you should also learn to separate personal finances from business finances. Doing this also helps you closely monitor your business finances status and also facilitates for easier tax compliance.
Recommended Resource: For an idea of which banks are best for business accounts, this roundup resource provides valuable insight.
This to-do list is not a state-mandated requirement to forming a Texas Corporation, but it is more of a best business practice that must also be implemented. Doing so will ensure that your business gets off on the right footing.
A business plan is the roadmap necessary to carve the right path to a thriving business. As such, a business plan also serves as a benchmark to check whether your business is on the right track and accomplishing its intended goals and objectives. With the help of the two resources below, you can begin writing a business plan.
A business website solidifies your online presence, and it only establishes your reputation as a reliable and trusted business. While creating a business website may seems a difficult task, this isn’t the case. Through Bluehost, you can make a professional-looking website through its one-click installation feature.
Resource for Getting Started: Creating a website is also a step-by-step process. If you’re ready to begin, use this detailed guide on how to make a business website.
Corporate bylaws help define the purpose of a Corporation and outlines the duties and obligations of the individuals who run it. Basically, corporate bylaws keep the internal operations of your Corporation well-oiled and smoothly functioning.
Corporate bylaws also prove your business’ legitimacy, and even though it is not mandatory, it is a good practice to have one in place for your Corporation.
This guide is only meant to give general information on how to form a Texas Corporation, but it should never be referred to as a legal document or advice. Contact your business lawyer for legalities involved in forming a Texas Corporation. To maintain good standing with the state, please take note to take care of your Texas Corporation Annual Report.