The dream of starting your own business is one that many people harbor close to their hearts. And although the prospect of beginning that journey can be incredibly exciting, it can be daunting to figure out all the ins and outs of the process required to incorporate a business in a given state–especially when you’re diving into the complex world of corporate laws. This is especially true if you’re based in the state of Texas.

When you’re considering bringing your business venture to reality from the Lone Star State, there are essential steps you’ll need to take to ensure you’re protecting yourself and your brand. Here’s a primer on what you need to know to get started on incorporate your business in the state of Texas, with a focus specifically on Dallas.

Understand Texas Incorporation Law

Before you begin the incorporation process, you should have a comprehensive understanding of what’s involved. Incorporation is the process of legally establishing a business entity in the eyes of the law, including filing documents with the state as well as paying any applicable fees and taxes.

When it comes to Texas state law, understanding the difference between the types of bodies you can incorporate is the first step. The three main types of incorporation are corporations, LLCs, and non-profits, each of which has its own set of advantages and disadvantages based on the type of business you’re looking to create.

Create an LLC

If you decide an LLC is best for your business venture, you’ll need to do a few more exams to complete the legal process. Although forming an LLC doesn’t require an attorney, having one review your paperwork can be a worthwhile investment.

You’ll begin by filing the required paperwork with the state. This paperwork includes a Certificate of Formation which states the purpose of your LLC, the company’s registered office and the name and address of the company’s registered agent.

Once this is completed, you’ll need to prepare an Operating Agreement. This document outlines who is running the company and how it is operated. Although an Operating Agreement is not required to be filed with the state, it’s an essential document to ensure all LLC members are following the same rules.

Finally, you’ll need to pay the state filing fees associated with both documents, which will vary depending on the size of the business.

Understand Your Tax Obligations

In addition to legally incorporating your business in Dallas, it’s important to understand your tax obligations. LLCs are required to pay both a state and federal income tax, and depending on the size and operations of your business, you may be required to pay other taxes as well.

Another key tax obligation related to LLCs is the state franchise tax. This is a fee paid to the state for the privilege of doing business in Dallas. The fees vary depending on the size of the business and the type of business, but it’s essential to understand the tax obligation of your LLC before you begin.

Find the Right Legal Support

As you can see, the process of incorporating a business in Texas is a complex one. To ensure that you’re following the correct procedures and fully understanding your tax and financial obligations, it’s essential that you work with a knowledgeable lawyer or legal counsel.

When you’re looking for a business lawyer in Dallas, consider UpCounsel. UpCounsel is an online marketplace for legal services, offering pre-vetted and experienced lawyers with the ability to provide comprehensive legal advice for businesses of all sizes.

With UpCounsel, you’ll be able to review the ratings and reviews of each of their lawyers from prior clients, giving you peace of mind when you make the decision to work with them. They are also able to provide the business lawyer services you need on an ongoing basis for those interested in running their own in-house template legal department.

Starting a business in the Lone Star State is an exciting journey, and one that’s worth doing the right way. By understanding Texas state law and finding the right legal support, you can rest easy knowing that your venture is on strong ground.

Topics:

Incorporation in Texas,

LLCs,

Dallas business lawyers