Texas LLC Registration: Everything You Need to Know
A Texas LLC registration is an essential part of forming an LLC in the state of Texas. The following steps ensure that your LLC formation is legal. 4 min read
How to Start an LLC in Texas
A limited liability company (LLC) is a business entity that's a suitable choice for many smaller businesses. It grants the owner an opportunity to limit personal liability in the financial state of his or her company. For example, if someone chooses to sue, the owner's personal assets aren't at risk.
An LLC is flexible in the way the company operates. In Texas, an LLC can be established with minimal hassle or expense. State and federal laws also offer numerous tax advantages to LLCs, such as the business itself not paying taxes. The business's net income passes to those who own the business. The owner then reports it as his or her personal income.
How to Start an LLC in Texas
If you're interested in starting an LLC in Texas, you must file with the Secretary of State. This registration includes:
- Filing the proper paperwork
- Paying the associated fees
- Meeting all formation or naming agreements.
The whole filing process takes three to five days. However, there is expedited filing of one business day available for an additional fee.
Registering the Name of Your LLC
In Texas, to begin an LLC, you should file a Certificate of Formation (Form 205) through the Secretary of State.
The following is the information needed for this form:
- Address and name of the LLC.
- Address and name of the resident agent.
- A statement that identifies the type of management and if it's managed by the member or a manager.
- Names and addresses of those who have organized the business.
- The intention of the business.
- If applicable, the dissolution date.
Steps to Register a Name for Your LLC
To register a name for your LLC, follow the guideline for the steps below:
1. Choose a legal name. The choice of name is up to you, but there are some guidelines and restrictions to follow:
- It has to be unique, since you can't match the name of an existing business.
- The name can't use profanity or obscene language, such as clearly sexual language. Also, it can't include words that could cause confusion with a federal or government agency.
- Certain words, such as bank, attorney, or university, require additional paperwork and may require licensing to be included in the LLC name.
- In Texas, an LLC has to have "Limited Liability Company," “L.L.C.,” or “LLC” following the business name. This should be included in your registration.
2. Check for the availability of your preferred business name.
To do so, you may contact the Secretary of State by emailing them at [email protected] or by phone at (512) 463-5555 (extension 711). In addition, you can now search for and reserve your available business name on the Texas Secretary of State website.
To search for the preferred name online, you'll need an account on the Secretary of State website. Anyone can ask for an account. If the request is submitted during business hours, it will be opened within 15 minutes.
When the account is active, you can do a search to check for the availability of your name. This costs $1. While you check for the name, also be sure to check the availability of the URL. You can check for a URL using a domain search tool online.
If you wish to reserve your name by mail or online, file Form 501. Both methods require a filing fee that is nonrefundable. The information required includes:
- The entity name
- The type
- Name and address of the person making the reservation
- The signature of the applicant's agent or lawyer.
3. Search the assumed business name. The public name, also called the assumed name, cannot copy the registered legal name of the LLC. Check for any duplicates of the name you want to apply.
An assumed name will be your “everyday” name. This can also be referred to as your “DBA” name or “doing business as” name. Several businesses are legally allowed to use the same assumed name, but it's best to choose a unique name for your business.
If you share your assumed name with another business, your customers may get confused. Also, if your assumed name is similar to another company's legal name, you could lose business as a result of the competition.
4. File the legal name of your business with the office of the county clerk. You can also file online at the Secretary of State Direct website.
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