A Certificate of Formation for a Texas entity is required to form a limited liability company (LLC) in Texas. Making your company an LLC has a number of benefits, including the limiting of your personal responsibility for your business's financial situation.

Obtaining a Certificate of Formation

There is a lot to gain from the process of acquiring a Certificate of Formation, and it is much easier and cheaper than it sounds. You can perform this process yourself or hire a registered agent, or person who will receive legal documents on your behalf, to perform it for you.

The first step is to submit the application for a certificate for a domestic LLC. The application requires all the essential details including:

  • The name and address of the LLC.
  • The agent filing for the certificate.
  • The type of management.
  • The purpose of forming the LLC.
  • You can also include the date of dissolution if you only intend to keep your LLC operating for a set period of time.

Naming Your Texas LLC

There are some regulations and restrictions you should keep in mind when filling out the form. The name of the LLC cannot include obscene or sexually explicit language. In addition, you should not choose a name that could easily be confused with a large government agency such as The Environmental Protection Agency or Federal Bureau of Intelligence. You also cannot copy the name of another LLC in the state.

If you're not sure whether a name is available in the state of Texas, you can call 512-463-5555 and dial extension 711 or email corpinfo@sos.state.tx.us. You can also open an account on the Secretary of State Direct website. There is a one dollar fee for every search you conduct on this website to determine if your desired name is available. If your LLC has a website, it will also be important to determine if your desired domain name has been taken as well. This process does not require any fees and can easily be conducted by putting your preferred URL into a search engine.

It's not necessary to stress out too much about what name to write on the Certificate of Formation, as it does not need to match the name that you will use when conducting business and interacting with customers in the community, also known as the "assumed name." In other words, the legal name can be "Fudge Factory LLC," but the name you put on the sign outside the store can be "The Heavenly Fudge Factory."

Unlike the legal name of your LLC, the assumed name doesn't even have to be distinctive from that of other companies in the state, although choosing a name that sounds too similar to a shop down the street might not be the wisest business decision. Finally, the legal name of your company must end with the abbreviation LLC.

Submitting your Certificate

When you have decided on a name, you can reserve it so it doesn't get snatched up while you're completing the registration process. You can log onto your SOSDirect website account and submit it online or print it and submit it by mail. It should be accompanied by a $40 filing fee and will last for 120 days. If you do decide to conduct business with an assumed name, however, you will need to file an assumed name certificate and pay an additional $25 fee.

Once you've finished filling out the forms and compiling the necessary documents, the application can be submitted online or downloaded and either mailed or faxed. It needs to also include a non-refundable fee of $300 to the Secretary of State. The fee can be paid by personal check, money order, or LegalEase debit card. Payments can also be made by American Express, Discover Card, MasterCard, or Visa but it should be noted a convenience fee of 2.7 percent of the total fee will be added if you use a credit card.

Once the forms and associated documents are received, they take three to five business days to process. If you want to expedite the process, you will need to submit a written request and include an additional fee. An extra fee will be charged per document that you submit rather than for the entire application packet.

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