What Is Texas Corporation Registration?

A Texas corporation registration refers to the process of filing for a legal entity that is distinct and separate from its founders or owners. Corporations have most of the responsibilities and rights that are legally granted to a individual. For example, Texas corporations have the right to loan and borrow money, hire employees, enter into contracts, pay taxes, own assets, file lawsuits, and face lawsuits. To form a Texas corporation, you will need to go through the Texas corporation registration process. 

LLC, Business License, Incorporation: Introduction

One of the most popular states for LLC formation and incorporation is Texas. This can partially be explained by the fact that Texas is the second-largest state in the United States in terms of population. Texas also has a flourishing business community. Dell and Exxon Mobil are two of the largest companies in the United States and both companies have their headquarters in Texas. The state of Texas services many different small businesses, especially those in information technology, agriculture, and other major industries.

Incorporating in Texas

Many entrepreneurs opt to begin a Texas corporation because the location grants them access to a large population, natural resources, and land. Just like in other states, entrepreneurs need to go through several steps to form a corporation

Entrepreneurs who fail to follow these steps properly will likely face lengthy delays in the processing of their application. If you want to form a Texas corporation, you should hire a service company that possesses a good understanding of the details related to the process.

How to Form a Texas Corporation

The Corporations Section of the Office of the Secretary of State, which is a state government agency, is responsible for overseeing Texas corporations.

The first step involves choosing a name. The name of the corporation needs to include these words or their abbreviations:

  • Incorporated, or the abbreviation Inc.
  • Corporation, or the abbreviation Corp.
  • Company, or the abbreviation Co.
  • Limited, or the abbreviation Ltd.

The name of the corporation needs to be unique in comparison to any of the other names used by business entities already registered with the Secretary of State of Texas. 

Before approving the proposed name for your corporation, the Secretary of State will conduct a name search to confirm that no other corporation within the state of Texas is using the same name. However, the Secretary of State will not look through the county filings. You should also keep in mind that the county will not have information for you to be able to check your proposed name against the incorporation records of the state.

You can use the SOSDirect website for the Secretary of State of Texas to check names for availability. If you have a good name in mind for your corporation but aren't ready to form the corporation yet, you can reserve a name for six months. All you need to do is send a completed Name Reservation form to the Secretary of State of Texas by mail or online. It is not necessary to make name reservations in the state of Texas. The fee for filing for the Name Reservation form is $40.

The next step is filling out the Certificate of Formation For-Profit Corporation and sending it to the Secretary of State of Texas. The certificate needs to include the name of the corporation as well as the address. It must include the address and name of the agent for service of process and the organizer's information. The certificate must also include the nature of the business and the number of shares the formed corporation will have the authority to issue. Finally, the certificate should include the effective date and the address and name of the board of directors.

You can file the certificate by email or online on the SOSDirect website of the Secretary of State of Texas. The fee for filing for a for-profit corporation is $300. On the other hand, the fee for filing is only $25 for a non-profit corporation in Texas.

It will take anywhere from three to five business days for the Secretary of State of Texas to process the Texas Certificate of Formation. This certificate is frequently referred to as the articles of corporation. You can also pay $25 more to have the certificate processed in a single business day.

If you need help with Texas corporation registration, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.