Key Takeaways

  • To start an LLC in Austin, Texas, you must file a Certificate of Formation, appoint a registered agent, and comply with naming and tax requirements.
  • The filing fee is $300, with optional additional fees for expedited service, DBAs, or certified copies.
  • Local permits or industry-specific licenses may be required, especially within Austin city limits.
  • An Operating Agreement is strongly recommended, even though it is not required by law.
  • Annual franchise tax applies only if revenue exceeds $2.47 million.
  • Foreign LLCs must register separately at a higher cost.

Form an LLC in Texas

To form an LLC in Austin, TX, there are several important requirements that you will need to fulfill. Forming an LLC, which is also known as a limited liability company, is a popular business structure. Other common business structures include:

  • General partnerships
  • Limited partnerships
  • Limited liability partnerships

In Texas, you can form an LLC with one member or as many members as you wish. LLCs are a unique type of business entity and differ from corporations and partnerships in several important ways.

In the Texas Business Organizations Code, the rules for LLCs are outlined in title 3, chapter 101. Reading the Code will help you understand the rules for LLC formation, including the information that must be included in your Certificate of Formation. The person or persons that own an LLC are referred to as members. Typically, LLC members are usually individuals, but members can also be corporations, partnerships, or other legal entities.

When you form an LLC in Texas, you will be required to file certain documents with the Secretary of State and pay a franchise tax to the state. More information about the franchise tax can be acquired by calling the Texas Comptroller of Public Accounts.

To pay your franchise tax and other taxes, you will need an Employer Identification Number (EIN). You can learn more about EINs by visiting the IRS' website.

When you form your LLC, your company will operate like a partnership but will have the same powers as a corporation. For example, an LLC protects member's personal assets from liabilities and debts incurred by the company.

Other than the capital that they provided to the company, an LLC shareholder will not be held liable for company debts. This differs from general partnerships, which holds all partners liable for the business' debts.

In a limited partnership, the liability of partners is limited, as is their power to make decisions on behalf of the company. All partners in a limited liability partnership are personally liable to some degree.

Once you decide whether forming an LLC is the right choice for your business, you will need to choose and register a name.

Costs to Form an LLC in Austin, Texas

When forming an LLC in Austin, the base filing fee is $300, paid to the Texas Secretary of State. You may also incur additional costs:

  • Expedited service: $25 per document.
  • Certified copies: $1 per page.
  • Assumed name (DBA) filing: $25 per name.
  • Registered agent services: $35 to $300 annually if you hire a professional service.
  • Franchise tax: Applied only if the LLC generates more than $2.47 million in revenue.
  • Foreign LLCs: $750 registration fee.

There are no annual LLC fees in Texas beyond taxes or business-specific license renewals​.

Entity Name and Type

You will need to provide a name for your company and a designation for your organization. The name you choose for your LLC must not be in use by any other business in Texas and should be as unique as possible.

Under the Business Organizations Code, LLC names that are identical or confusingly similarly to other LLCs in the state cannot be reserved or registered. You can find out more about the naming rules for LLCs in Texas on the Secretary of State's website.

It's also possible to receive the state's decision on your desired company name by calling the Secretary of State at (512) 463-5555 or by sending an e-mail. Be sure that the name of your LLC includes either “limited company” or “limited liability company. You are allowed to use abbreviations of these words such as L.L.C. Final approval will not be given to your LLC name until the Secretary of State has received all necessary documentation.

Even if you have received a preliminary LLC name determination, you should not attempt to transact business using this name until you have been issued a Certificate of Formation. 

Operating Agreement and Business Structure Considerations

Although Texas does not legally require an LLC to have an Operating Agreement, creating one is highly recommended. It helps establish internal rules for:

  • Ownership structure
  • Management roles and responsibilities
  • Voting rights and decision-making procedures
  • Allocation of profits and losses
  • Rules for member departure or dissolution

This document adds clarity and protects the legal status of your LLC in case of internal disputes or audits​.

Registered Agent and Registered Office

When choosing a registered agent for your LLC, you can select either an individual who is a Texas resident or a domestic/foreign entity that is legally allowed to transact business in the state. Your registered agent, whether it is a person or business entity, is appointed to accept service for legal documents on behalf of your LLC.

In 2010, Texas regulations changed, and registered agents are required to accept the role either in writing or through an electronic form. If you name a registered agent without the person or business' consent, you will face stiff penalties as described in the Business Organizations Code.

Your registered agent must possess a physical Texas address where they can receive service of process. A P.O. Box or address for an answering service is not acceptable.

If you're not sure if forming an LLC is the right choice for your business, you should contact an experienced attorney. The right attorney can help you handle all the paperwork needed to form your LLC, and can help you make important decisions related to management of your company and the distribution of losses and profits. 

How Long Does an LLC Last in Texas?

An LLC in Texas can last indefinitely unless otherwise specified in its Certificate of Formation. You can voluntarily dissolve it by:

  1. Following the winding-up procedures in your Operating Agreement.
  2. Getting a Certificate of Account Status from the Texas Comptroller.
  3. Filing a Certificate of Termination with the Secretary of State ($40 fee).

The state may also terminate your LLC for failing to maintain a registered agent or for non-compliance with tax requirements​.

Austin-Specific Business Requirements and Local Licensing

In addition to forming your LLC at the state level, businesses operating in Austin may need:

  • City-specific licenses or permits, depending on the nature of the business (e.g., food services, health, construction).
  • A Zoning Permit if operating from a physical location.
  • Sales Tax Permit (free), if selling taxable goods or services.

You can check licensing needs via the Austin Development Services Department or Texas.gov. Ensure you're compliant with both city and county regulations when setting up a business in the area​.

Frequently Asked Questions

1. How much does it cost to form an LLC in Austin, Texas? The base cost is $300. Additional fees may apply for expedited processing, registered agent services, or DBAs.

2. Do I need a business license to operate an LLC in Austin? Yes, depending on your industry and location, you may need local permits from the City of Austin.

3. How do I get a registered agent in Texas? You can appoint yourself, another member, or hire a professional service. The agent must be a Texas resident or authorized business.

4. Is an Operating Agreement required in Texas? No, but it’s highly recommended for establishing your LLC’s internal rules and protecting your legal interests.

5. What taxes does an LLC in Texas pay? LLCs may owe federal taxes and a Texas franchise tax if revenue exceeds $2.47 million. Most small LLCs are exempt.

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