Key Takeaways

  • Form 205 is the Certificate of Formation for Texas LLCs and is required for legal business registration.
  • The form includes key information such as business name, registered agent, governing structure, and purpose.
  • Name reservations can be filed using Form 501 for up to 120 days.
  • The form can be filed online through SOSDirect or by mail.
  • Filing fees, approval times, and signature requirements vary depending on the method.
  • Additional information includes organizer requirements, optional supplemental provisions, and common errors to avoid.

Form 205 LLC is required if you want to form any type of LLC in the State of Texas. The Texas LLC can be formed to operate a business, i.e. sell products or services, or hold assets, i.e. real estate investment company. Unlike corporations, LLC owners are called members. An LLC can operate as a single-member LLC having one owner, or as a multi-member LLC having two or more owners. The owners can be individuals or businesses of any kind. There are certain requirements that must be met in order to property form your Texas LLC, and its’ important for you to be aware of the requirements, as well as the forms necessary in order to begin conducting business in the State of Texas.

What Is Included in Form 205

Specifically, Form 205 is the Certificate of Formation for all businesses wishes to register an LLC in the State of Texas. There are several items that must be included in this document, including:

  • Business name
  • Registered agent and office
  • Governing authority
  • Purpose

Filing Form 205 Texas: Online and Mail Options

Form 205 can be submitted in one of two ways:

  • Online Filing: You can submit Form 205 electronically using the Texas SOSDirect system. This method offers the fastest approval, typically within 2–3 business days.
  • Mail Filing: You may also print and mail the completed Form 205 to the Secretary of State. Mail filings usually take 7–10 business days to process, not including mailing time.

The filing fee for Form 205 is $300, whether filed online or by mail. The check for a mailed submission should be made payable to the “Secretary of State.”

Business Name

You’ll want to provide your business name and type of business (i.e. Series LLC, PLLC, or LLC). But before choosing a random name, you will first need to ensure that the name you want to use is available. If you enter this business name, and the name is either not available or if it’s similar to that of another name, then your registration will be rejected. Therefore, you’ll want to conduct a business entity search beforehand to prevent this from happening. You can also call the Texas Secretary of State’s office at (512) 463-5555 or e-mail [email protected] to find out if your business name is available.

There are several other requirements when choosing a name, including the fact that your name must include the LLC business designator. There is some flexibility in terms of including the designator at the end of your business name; you can include variations of the designator, including L.L.C., LLC, L.C., Ltd. Liability Co., and other related variations of these terms.

You cannot use terms that would imply that your company operates as another type of business structure, including terms like corporation, trust, incorporated, etc.

Once you’ve chosen your business name, you can reserve that name for up to 120 days by submitting an Application for Reservation of an Entity Name (Form 501) to the Texas Secretary of State. The filing fee is $40.

Common Reasons a Business Name is Rejected

Even if your chosen name includes the appropriate LLC designator, it might still be rejected for reasons such as:

  • The name is deceptively similar to an existing entity.
  • It contains restricted words like "bank," "university," or "insurance" without proper authorization.
  • It implies a government affiliation or unlawful purpose.

To reduce rejection risk, perform a preliminary name availability search and consider reserving your name with Form 501 for a $40 fee.

Registered Agent and Office

You will need to obtain a registered agent for your LLC. The agent can be a domestic or foreign business that is authorized to do business in the State of Texas, or alternatively, it can be an individual who resides in the State.

The LLC cannot act as its own registered agent. However, a member of the LLC can operate as the registered agent, so long as that member has a physical address in the State. This means that if the member is a person, he or she must reside in the state. If the member is a business, that business must be registered in the state, and have its own physical office location (apart from the LLC office location) where it can receive legal papers. Furthermore, the agent must explicitly consent to being the agent, i.e. signature on Form 205 is required.

The registered agent, if a business, must have a physical office address within the State. The office address must be open during normal business hours. Therefore, if legal papers need to be hand delivered, this office address must be open during these hours, and someone must be at the address to receive and sign for such papers.

What Happens If Your Registered Agent is Rejected

If your registered agent’s information is incorrect or they fail to provide consent, your Form 205 filing will be rejected. To prevent this:

  • Ensure the agent signs the consent form or section on Form 205.
  • Verify the registered agent address is a physical street address in Texas (P.O. boxes are not acceptable).
  • Make sure the agent is available during normal business hours.

If rejected, you will need to correct and refile the form, which may delay your LLC’s approval.

Governing Authority

Form 205 must also include how the LLC will be managed, and whether it will be managed by the members (member-managed) or managed by a manager (manager-managed). If the LLC chooses to hire a third party to act as the manager, the manager’s name and address must be included in the document.

Information About the Organizer

The organizer is the person or entity completing and submitting Form 205. This role is separate from members or managers and does not require ownership in the LLC. The organizer must:

  • Be at least 18 years old.
  • Provide their name and address on the form.
  • Sign the document.

Once the LLC is formed, the organizer’s role ends. The members or managers then take over governance.

Purpose

While Form 205 allows you to create an LLC for any general purpose, the IRS might require that you provide an actual purpose for forming the LLC, particularly if you want to obtain licensing, or other tax-specific advantages.

Optional Supplemental Provisions or Information

Form 205 includes an optional section where you can add supplemental provisions. These are not required but may be useful if:

  • You want to restrict member rights or transfers.
  • You are forming a Series LLC and want to detail its internal series structure.
  • You wish to define specific management duties or limitations.

Adding custom provisions may require guidance from a business attorney to ensure compliance with Texas law.

Frequently Asked Questions

  1. What is Form 205 used for in Texas?
    Form 205 is the Certificate of Formation used to legally register a Limited Liability Company (LLC) in Texas.
  2. Can I file Form 205 myself without a lawyer?
    Yes, you can file Form 205 on your own. However, an attorney can help ensure all details are correct, especially for more complex structures.
  3. What’s the difference between an organizer and a member?
    An organizer files Form 205 to create the LLC, while a member is an owner of the LLC.
  4. How do I change my registered agent after filing Form 205?
    You must file Form 401 (Change of Registered Agent/Office) with the Secretary of State and pay the appropriate fee.
  5. Do I need to include an EIN on Form 205?
    No, the Employer Identification Number (EIN) is not required on Form 205. You can apply for an EIN after your LLC is approved.

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