Step 1) Verify & Secure Your Brand Name
To secure and register your brand name it must be unique, not too similar to another registered name, and shouldn’t contain any restricted wording.
Keep in mind your LLC name should contain the words ‘Limited Liability Company’ or ‘Limited Company’. Abbreviations for these words like ‘L.C.’ or ‘L.L.C.’ are also acceptable. If needed, file an Application for Reservation of an Entity Name form with the TX Sec. of State that’s good for 120 days.
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use Weebly to search your options. If there’s a quality domain name for purchase, we advise buying it right away.
Step 2) Appoint A Registered Agent
In Texas, a Registered Agent is essential. Their job is to receive and help process all critical business documents like tax forms, state filings, notifications, etc. Some requirements for the job include:
- Legal individual TX resident, or,
- A legal business entity registered in TX,
- Must have a physical street address.
You can hire an outside professional service and pay up to $160/yr, or get an agent for free when you have a service like IncFile form an LLC for you.
Step 3) File The Certificate Of Formation
Download, fill out, and file a Certificate of Formation with the Texas Sec. of State as soon as you have verified your brand name and are ready to set up shop. Basic information for the public record includes:
- Name and address of the Texas LLC;
- Name and address of the Registered Agent;
- Name and address of the governing individual(s);
- Name and address of the LLC organizer;
LLC Filing Fee: $300
Step 4) Get An EIN
An EIN, or Employer Identification Number, is required if you want to have a smooth tax season, set up a business bank account, legally hire employees, etc. All legal business entities need one like individuals need a social security number.
Thankfully you can easily get your EIN free of charge through the IRS Website.
Step 5) Setup A Business Bank Account
There are two main reasons to open a unique business bank account. The first is the many perks, incentives, and kickbacks that banks and lending institutions offer. Shop around with local, state, and national banks as well as credit unions to find the best deal for your business.
Secondly, a business bank account simplify your finances by allowing you to sync the account with your accounting software.
Step 6) Draft An Operating Agreement
This is a formal, contractual agreement between all owners of a company that outlines financial and managerial responsibilities. It’s not mandatory or required by law, but it is very important because it will protect all parties, as well as your brand. Even solopreneurs should have this document.
Check out a savvy online Operating Agreement template and customize it according to your LLC’s needs to get started.
Step 7) Handle LLC Taxes & Licensing/Permits
Paying state and federal taxes can be much simpler with help. Variables such as the type of your business and your location will determine what kind of licenses you will need and what fees you will need to pay.
To get started, bookmark the Dallas/Fort Worth district office (or whichever is closest to you) of the Small Business Administration, and the Sec. of State’s SOSDirect site. If you need help with this step, consider a resource such as the Business License Research packages that can handle the legwork for you.
Need Help Forming an LLC?
If you'd like help forming an LLC in Texas, feel free to read our reviews of the two most popular services available.