How to Start an LLC in Texas
Looking to start an LLC in Texas? Read on and learn how to start an LLC in Texas in 3 simple steps. Check out our recommendations for the top Texas LLC filing services below.
Start an LLC in Texas in 3 simple steps
- Choose a unique name for your business
- Select your Texas registered agent
- File with the state
Starting an LLC is one of the simplest and safest ways to shape your business while protecting your assets, should your business be sued. That said, filing one without prior experience can be a challenging and time-consuming process. Any mistakes you make can cause significant delays.
What is an LLC?
An LLC or ‘limited liability company’ is a U.S. business structure that provides the owners with a level of legal protection by not making them personally liable for the company’s legal responsibilities or debts.
Now, let’s review the steps required for you to incorporate an LLC business and obtain LLC protection. Each U.S. state has its own set of guidelines for starting an LLC, however as this article focuses on Texas, the following is a full guide to starting your Texas LLC on your own.
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Step 1: Choose a unique name for your Texas LLC
Choosing a name for your Texas LLC is not as easy as it looks. First, you will need an original and one-of-a-kind name that is not currently being used by any other business in Texas. The search results should show ‘No Matching Entries Found,’ which tells you that you can proceed with your chosen LLC name.
Here is a quick summary of the main guidelines:
- Your LLC business name should not contain the following words: ‘Agency,’ ‘Board,’ ‘Bureau,’ ‘Commission,’ ‘Department,’ or ‘Municipal’
- Your chosen name should include ‘Limited Liability Company’ or at least an abbreviation of the entire phrase like ‘LLC,’ ‘L.L.C.,’ ‘Limited,’ ‘Ltd.,’ ‘Company,’ or ‘Co’
- Words and phrases such as ‘State Department,’ ‘Treasury,’ and ‘FBI,’ among others, cannot be used so that your name will not be confused with a government organization
We recommend that you check if your website domain is available from the get-go, even if you don’t have plans of launching a website for your business now. If you’re proactive, you can prevent other businesses from snagging a URL that you may want to use in the future.
Step 2: Select your Texas registered agent
All Texas LLCs must have a registered agent. This person is responsible for receiving official government documents, tax correspondence, and legal notices. Part of the responsibility is also filing the needed reports with the Texas Secretary of State. They are your LCC’s point-of-contact with the Texas government, in short.
This position can be yourself, another manager in your LLC, or a professional registered agent service. You can check out our registered agent reviews page to better understand why we highly recommend that you appoint a professional registered agent service. (See our recommended services below)
Should you pay for the services and expertise of a registered agent service, it is essential that they have a physical address in Texas and should always be available to receive documents on behalf of your company during standard business hours.
Fortunately, we’ve got not one, but two industry-leading recommendations for you!
BEST FOR: Launch your LLC company
ZenBusiness offers a wide variety of services for business formation. Its starter package will cover your incorporation process for $0 plus state fees and tax deduction consultations. The pro package costs $199 plus state fees, Worry-Free Compliance, and expedited filing (4 to 6 days).
The premium package is quite pricey at $349 plus state fees, but it includes high-value add-ons like customizable business website, domain name, email address, and expedited filing (2 to 3 days). Users can also access helpful features, like amendment filing, domain name privacy, and business license report with the base plan for an additional fee.
Read our full ZenBusiness review
Pros & Cons
BEST FOR: Professional registered agent service
Northwest Registered Agent is a well-established registered agent service with two decades of experience. They allow you to add a registered agent in multiple states (if your business requires it) and can cover all of your Texas LLC registration needs.
Northwest Registered Agent gives you an online portal to easily access your uploaded documents and state forms. You can check anytime from anywhere while ensuring that all your information is secure.
Read our full Northwest Registered Agent review
Step 3: File with the state
As required by the state.
I launched my Texas LLC – What’s next?
Congratulations on your LLC! Don’t forget that the process and legwork don’t stop here. After successfully forming your LLC, post guidelines can make your business organized, seamless, and less complicated.
Set the line between personal and business resources
It’s recommended that you separate your personal assets from your LLC. Assets such as your house, car, and other personal properties should not mix with your LLC’s assets. This way, if your Texas LLC gets sued, you can have peace of mind knowing that your valuables are safe and will not be dragged into the picture.
Open your business bank account
It will be easy and tempting to ‘borrow’ or refinance your LLC using your account when your LLC needs some financial uplift, but don’t. Just like your personal resources, your savings and money meant for personal use should be kept private. If you need funds to jump-start your business, you can always consider a business loan.
Best small business banks
Read our best small business bank review page to learn more about business banking and find the best bank for your business.
Onboard a business accountant
A business accountant can oversee and ensure that your organization is not overpaying in taxes while at the same time making sure that you don’t have any penalties and other expensive tax errors. Having one also removes the responsibility of bookkeeping and payroll off your shoulders. You can focus on the other angles of growing your business.
Consider getting business insurance
Regardless of how small your company is at the moment, growth and expansion are part of the long-term goal. Getting business insurance can help you feel secure from any possible risks. It can assist you in managing potential lawsuits or even malpractice and other business-triggered errors.
As a responsible and pro-employee organization, you’d also want to consider workers’ compensation insurance to provide coverage for your employees should there be any work-related injuries, sicknesses, or even death that may happen.
Frequently asked questions
What’s the Texas LLC state fee cost to form a new business?
Texas State fee: $300
Is a Trade Name mandatory for my business?
In Texas, most LLCs don’t need a ‘Doing Business As’ (DBA) or a trading name. The name you set for your LLC is your brand name, and you can accept payment under that name. It is recommended that you have a DBA when you have plans to do business under a different name.
How long is the processing time for my Certificate of Formation?
If you filed it online, the ideal turnaround time is 5-7 business days. The state will processed filings sent via email in the order it received them. Expedited filings are also done at an additional fee of $25 per document.