Texas S Corp Formation

Texas S Corporation Formation

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Steven S.

Steven Stark

397 reviews
For over 30 years, Steven Stark has offered counsel to non-profit organizations and private companies. He has a passion for helping small businesses in particular since he himself started several businesses of his own in New York and Florida. He understands the importance of small businesses having a reliable attorney to advise them about legal matters from their inception.
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Richard G.

Richard Gora

191 reviews
Looking for an attorney with experience? Richard Gora is the exact attorney you want. Having defended over 100 cases both in state and federal courts and working with clients from around the globe, Richard has an array of different experiences. His services are wide-ranging and include business litigation, securities litigations, employment litigation, and business counsel. Prior to founding Gora LLC, he worked for Finn, Dixon & Herling LLP for eight years.
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Joshua G.

Joshua Garber

256 reviews
Representing notable clients like Tesla and the City of Los Angeles, Josh Garber excels at helping clients with employment and labor laws. Many of his past clients have had great success using Josh for employment agreements and Division of Labor Standards Enforcement (DLSE) hearings. With his practical advice, he has even helped clients avoid going to court.
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Fisayo F.

Fisayo Fadelu

Fisayo Fadelu is a business attorney that specializes in assisting startup companies and nonprofit organizations with their legal matters. She is licensed to practice law in Texas and has more than four years of experience. Fisayo obtained her legal degree from the University of Texas School of Law in Austin. She has been the CFO and a general counselor at Pecan Street Inc. since May 2013. Prior to her current position, Fisayo was an IP consultant at Mattersight Corporation.
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Tiffany H.

Tiffany Hanzik

Tiffany worked for Eagle Land Services, Inc before joining the Pratt Aycock team as a practicing lawyer. Her areas include business law, real estate law, dispute resolution, immigration law and oil and gas. She received a JD from Texas A&M School of Law. In addition to her law degree, she also attended Southern Methodist University where she graduated with a Masters in Dispute Resolution. Volunteer service is a priority for her as she is part of the Junior League of Dallas.
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Not M.

Not Me

Attorney Walter Coppersmith has over 21 years of experience in corporate formation, corporate governance, business transactions, and intellectual property. Before practicing law, Attorney Coppersmith was an experienced C-level executive that built and sold companies for millions of dollars. With his expertise in technology, he is able to help his clients protect their businesses through patents, trademarks, and copyrights.
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Tri N.

Tri Nguyen

2 reviews
With my broad experience as a former big firm attorney, former general counsel, and Chief Legal Advisor to small businesses and lower-middle market companies, I bring thoug... read more
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Richard F.

Richard Fine

Richard Fine is a business attorney that specializes in real estate, probate and tax related matters. He obtained a license to practice law within Texas in 1980. Richard is a member of the State Bar of Texas, the Houston Bar Association and the American Bar Association. He attended the Southern Methodist University, where he received a Juris Doctor degree in law. Richard also obtained a B.B.A. and M.B.A. at the University of Houston.
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Robert L.

Robert Linkin

3 reviews
As the founder of the Linkin Law Firm, Robert Linkin is your answer to all legal matters involving business. Whether you have a complex business dispute or you are trying to establish and enforce a contract, Robert is able to help you. Mr. Linkin has established himself as an entertainment lawyer and is also known for helping artists secure record label deals and similar.
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Forrest G.

Forrest Gordon

5 reviews
Forrest Gordon has 10 years of experience as a corporate attorney. He provides both in-house and contract-based legal services. Forrest practices law in Texas and obtained his law degree from the University of Houston Law Center. Forrest also has experience in dealing with real estate, commercial contracts and other corporate legal issues. He recently became a managing partner at Gordon Lusky LLP, but was previously the senior legal counsel at Trican Well Service for four years.
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Conor T.

Conor Teevan

147 reviews
Top-tier talent shouldn’t have to come with a top-tier fee. This is why Conor Teevan combines his top-tier expertise (Yale undergrad, Stanford Law) with affordability. Conor has represented Silicon Valley startups, real estate investors, artists creating companies, and even a child author in need of a book deal. Conor himself started a real estate company with holdings in five states.
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Johnny M.

Johnny Manriquez

114 reviews
Johnny Manriques is a patent attorney with extensive experience in dealing with cases that involves intellectual property law and related legal matters. He has more than 14 years of experience and is licensed to practice law in California. Johnny is registered with the State Bar of California. He has a Juris Doctor degree in law. Johnny recently started his own firm, but worked with Procopio Cory for three years prior to starting his own law office.
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Thomas B.

Thomas Bark

394 reviews
Thomas Bark is a Partner at Jones Bay working with startups, but he can also handle legal matters for large companies. Previously, he has worked for two top international law firms for some 25 years - some of his experience includes working abroad.. His practice extends to corporate law and commercial contracts, with a particular emphasis in VC finance, M&A, lending, employment, joint ventures and technology issues. He attended The University of Virginia School of Law.
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Seth W.

Seth Wiener

883 reviews
As an experienced trial lawyer and litigator, Seth Wiener has resolved numerous federal and state litigations. His cases have included everything from family law to bankruptcy to fraud and more. Before Seth formed his own firm, the Law Office of Seth W. Wiener, he worked for several prominent law offices where he gained a great deal of experience.
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Grant M.

Grant Maynard

99 reviews
Grant represents high-growth companies in all aspects of formation, financing, and intellectual property issues. He has previously done general corporate, intellectual, and real estate work at Nebraska's oldest law firm before transitioning to a more virtual lifestyle. As an entrepreneur himself, he understands the need to balance legal and business interests.
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Ramsey T.

Ramsey Taylor

81 reviews
Ramsey Taylor is a business attorney with over 21 years’ experience. He has exceptional experience in dealing with international business law, but also assists local companies within the United States with their legal matters. Ramsey is licensed to practice law in New York and the District of Columbia. He obtained his Juris Doctor degree from the New York University. In March 2017, Ramsey founded his own legal firm, Taylor Legal, where he now acts as the owner and principal attorney.
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Scott S.

Scott Stram

237 reviews
As a member of both the New York and New Jersey Bars, Scott Stram is an accomplished lawyer with experience in a range of legal and business areas. This includes corporate law, data security, compliance, real estate, and intellectual property. Before founding Stram Law, Scott was a compliance officer for a company that performed property audits, a director of a security consulting practice, and an operations officer for Viacom and CBS.
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Mary H.

Mary Hodges

187 reviews
Employment is a big part of any business, and Mary Hodges understands that many business owners may not know the legal details of the hiring or termination process. She works with business owners with a variety of needs: from working with independent contractors, to developing and implementing employment policies, non-disclosure agreements, and more. Ms. Hodges can also help with business formation, contracts, and operations.
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Bradley R.

Bradley Rothschild

163 reviews
Creativity is key for Bradley Rothschild, a real estate, business, intellectual property, and entertainment attorney. When clients need an attorney who will think outside the box for them - Mr. Rothschild is the right person for the job. He focuses on not only solving problems, but also on serving the whole client and preventing problems.
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Neil P.

Neil Park

133 reviews
Neil Park is well-equipped in Private Practice - with over 7 years of experience acting as outside General Counsel for many of his business clients. For the past two years, Neil has been working as Counsel for an Intellectual Property boutique. His practice areas include Intellectual Property Counseling, Trademark Prosecution, Licensing, Trade Secret Management and Strategy, Business Transactions, Corporate Law and Regulatory Compliance. He attended Loyola Law School.
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Seth H.

Seth Heyman

175 reviews
Seth Heyman takes the saying, "the devil is in the details" to heart. As a corporate law attorney, he knows that being thorough and detail-oriented is extremely important in transactions and in every agreement. Mr. Heyman has over 20 years of experience with entity formation, advertising law, contracts, regulatory law, international law, and Internet law. He provides practical and cost-effective legal solutions.
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Lauren R.

Lauren Roberts, Esq.

87 reviews
Lauren Roberts was the Senior Associate working for the Law Offices of Bovino & Associates. She is now a Corporate Attorney with plenty experience - handling Corporate Transactions, Intellectual Property, Business Matters and Legal Research. She is well-equipped in conducting of extensive due diligence reviews. Roberts attended the University of Colorado at Boulder in 2008 and graduated with her J.D. three years later. Just prior to that, she graduated cum laude from the New York University.
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Lois (Nuo Jia) L.

Lois (Nuo Jia) Li

65 reviews
Lois Li is a commercial attorney with extensive experience in business law. She primarily focuses on assisting startup and small businesses. Lois served as an in-house and outside counsel in the past. She has a license to practice law in two countries, including the United States and Canada. Lois is able to assist clients in Chinese and English. She completed a degree in law at the University of Detroit Mercy School of Law. Lois is currently an attorney at Alpine Law PLLC.
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Helen Q.

Helen Quinn

53 reviews
Helen has extensive experience in structuring, negotiating, and managing corporate transactions. In her previous role as a senior corporate securities attorney for Wilson Sonsini, she provided corporate counsel in connection with over seventy merger and acquisition transactions, over fifty venture capital finance transactions, and several initial public offerings.
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Ben H.

Ben Habegger

47 reviews
Ben Habegger is a business attorney with more than 18 years of experience. He is licensed to practice law in Indiana and holds a Juris Doctor degree in law, which he obtained from the Indiana University Robert H. McKinney School of Law. Ben specializes in a wide range of corporate legal practice areas, including commercial contracts, labor and employment law, and business formation. He has been an attorney at Outsourced General Counsel since November 2017.
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Glenn M.

Glenn Manishin

130 reviews
Glenn Manishin is the managing partner at Paradigmshift Law LLP and founded the law firm in 2015. The focus of his law firm lies within Internet technology and business law. Attorney Manishin has a mission in place to help clients and companies find creative and efficient ways for their business models to navigate through legal and regulatory barriers. Attorney Manishin has worked with top companies including Sports Fans Coalition, Inc., Consumer Federation of America, and more.
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Carlos C.

Carlos Colon-Machargo

110 reviews
Carlos Colon-Machargo is a corporate attorney with exceptional experience in all business-related legal practice areas. He has a primary focus on employment law, estate law and insurance law, as well as commercial contracts. Carlos has over 21 years of experience. He is licensed to practice law in Georgia, Florida, the District of Columbia and Puerto Rico. Carlos obtained his legal degree from the Georgetown University. He has been a member of the Colon-Machargo Law Studio since 2013.
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Geoffrey A.

Geoffrey Amend

639 reviews
Geoffrey Amend has over 21 years of experience as a business attorney. He is licensed to practice law in Kansas. Geoffrey has represented numerous corporate clients, including JungleBee, MomoCentral and APIMATIC. He started his own legal firm in 2013 and was the general counsel at Chelsea Partner before starting his own firm. Geoffrey graduated with a J.D. in law from the Washburn University School of Law in 1995.
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Eric K.

Eric Kirkland

121 reviews
Eric Kirkland is a business attorney with a strong entrepreneurial background. He has 26 years of experience. Eric focuses on contracts, intellectual property, strategic partnerships, software licensing and other general business-related legal matters. He is the managing attorney of Kirkland Law and was previously the founder and CEO of Just Cellular Inc. Eric graduated with a Doctor of Law from the Pepperdine School of Law.
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Jeff C.

Jeff Carson

64 reviews
Jeff Greenblatt provides small to mid-size technology companies with effective legal counsel, but his clients will tell you that he responds as if he is your personal in-house counsel. Perhaps this is because of his experience as a general counsel for a variety of businesses. Mr. Greenblatt handles contracts and transactions, intellectual property issues, employment matters, and compliance and risk management.
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Paul S.

Paul Spitz

114 reviews
With an MBA in marketing from Indiana University, Paul Spitz offers business experience and legal expertise to companies ranging from startups to midsize organizations. He specializes in the areas of technology, marketing, e-commerce, and digital media. Unlike attorneys at large law firms, Mr. Spitz is able to provide affordable services in counseling, representation, and negotiation.
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Jenny V.

Jenny Villier

46 reviews
Jenny graduated from Notre Dame Law School and has a bachelor's degree in finance and accounting from the University of Dayton. Jenny was a member of the Notre Dame Law Review. Jenny is also a CPA (inactive). Jenny's practice areas include business and tax law, with a particular emphasis on small business and startup legal issues. Jenny regularly writes in the areas of business law, tax law, estate planning and employment law. Her articles have been published in the ABA Business Tax Quarterly, the ABA Private Equity and Venture Capital Committee Newsletter, and the WealthCounsel Quarterly.
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Joseph W.

Joseph Waala

41 reviews
Joseph Waala is an Attorney, who has been licensed for 17 years. In the year 1999, he was an Associate with Baker & Hostetler. After that, he spent time working for Law Firms such as King & Spalding, LLP and Phillips Lytle, LLP. His focus areas include energy and utilities, oil and gas, contracts and agreements, as well as commercial real estate matters. Joseph attended The Georgetown University Law Center and graduated with his J.D. almost two decades ago.
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Mario N.

Mario Naim

162 reviews
Mario's firm focuses on serving growth companies throughout the venture capital life cycle from startups to public companies. The firm provides services related to business law, specifically corporate, securities, business combinations and commercial transactions. He has also helped foreign clients in the acquisitions of businesses in the U.S., Canada, Europe, the Middle East, and South America.
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David Y.

David Yamaguchi

152 reviews
Startups and small businesses sometimes need someone who can deal with complex transactions on an international playing field. David Yamaguchi specializes in content hosting issues and intellectual property. He concentrates his practice in the United States, Asia, India, and Europe. Whether you are a business giant or a startup, Mr. Yamaguchi can provide legal advice that fits your needs.
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Kaiser W.

Kaiser Wahab

56 reviews
Complex corporate transactions in technology, media, and securities require a knowledgeable and experienced attorney. Kaiser Wahab brings those qualifications with him when he is counseling clients on corporate structuring, investor agreements, and equity incentive plans. Whether you are a Fortune 500 company or a start-up, Mr. Wahab has your complex business needs covered.
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Mary O.

Mary Obidinski

58 reviews
Business owners often shudder at the idea of having to pay general counsel for legal advice. With Mary Obidinski, you know that you are getting straightforward, honest legal options that will not break the bank. Ms. Obidinski is worth every cent from her experience as general counsel for a large private corporation and work with small businesses and starts ups.
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Renate H.

Renate Harrison

28 reviews
Renate Harrison provides her clients with legal services as they should be - with compassion, diligence, and attention to detail. Ms. Harrison helps businesses with various transactions, including acquisitions, divestitures, joint ventures, cross-border transactions, corporate financings, and restructurings. She can also help with real estate issues and the unique legal issues that face non-profit businesses.
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Thomas L.

Thomas Love

69 reviews
Holder of seven patents, Thomas Love has a work history spanning from a partnership in a major firm (specializing in international corporate finance) to working at a number of startups, including in software, global supply chain, and online education. Today, Mr. Love represents clients worldwide and has provided his services to non-profits in theater, women’s empowerment, medical education, and more.
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Stacy S.

Stacy Smith

81 reviews
Stacy Smith is your go-to for your business and real estate needs. She can help with business sales and purchases, entity formation, contracts, and more. Whether your business needs help with vendor agreements or financing, Ms. Smith can help. She can also deal with things like zoning and separating or combining lots. She brings her 25 years of experience to every legal issue.
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Jonathan S.

Jonathan Savar

85 reviews
In addition to being a skilled business lawyer, Jonathan Savar is highly experienced in investment banking. He handles strategic transactions, financings, and contracts for individuals, startups, and middle-market companies. Mr. Savar offers every one of his clients individualized attention to provide efficient, cost-effective services.
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James J.

James Jones

44 reviews
James a digital age lawyer for entrepreneurs. His practice is centered on fulfilling the needs of the entrepreneur, small business owner, and startup community. He can provide legal representation to clients who are launching their first business, seeking advice for future planning, or ready to expand. James' background as a teacher has helped him break down complex legal concepts for clients.
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Philip H.

Philip Heller

76 reviews
A corporate and commercial transactions counsel, Philip Heller has represented leading digital media, entertainment, and technology companies, including Warner Bros, Hulu, and American Express. He is particularly knowledgeable about SaaS, software licensing, partnerships, and private equity funds. Mr. Heller specializes in negotiations and drafting complex agreements and privacy policies.
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Sunita K.

Sunita Koneru

27 reviews
Sunita Koneru knows that your business transactions and intellectual property issues are important to you and your company. That is why she works hard for her clients to get every agreement just right. Her motivation, networking skills, and diligence make her a cut above the rest if your business or non-profit needs a strong commercial attorney.
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Jamie D.

Jamie Davenport

39 reviews
Jamie Davenport is a business lawyer that specializes in drafting and negotiating commercial contracts. She primarily assists startup companies and entrepreneurs overcome legal hurdles, but she is able to assist clients of any size. Jamie is also experienced in dealing with legal matters that concerns trademark and copyright law. Jamie has over 17 years of experience and she is licensed to practice law in California. She has been acting as a solo practitioner since 2012.
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John F.

John Fallone

71 reviews
John Fallone thinks big and gets it done. As an early-stage company attorney, John is also a co-founder of SendHub, the cloud-based phone system making it easier for today’s businesses to communicate with customers and employees. A self-identified geek of processes and efficiency, John plans to get an MBA from Duke’s Fuqua School of Business
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Dean S.

Dean Sage

30 reviews
Dean Sage is an attorney at law with over seven years of experience. He is licensed to practice law in California and obtained his legal degree from the University of Michigan Law School. Dean is experienced in dealing with legal matters related to real estate law, tax law and business formation. He is also skilled in legal research and writing, as well as drafting and negotiating commercial contracts.
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Drew S.

Drew Stokesbary

28 reviews
Drew Stokesbary is a corporate lawyer that primarily specializes in providing legal assistance to startup companies. He has been licensed to practice law in Washington for the past four years. Drew received a legal degree after he graduated from the Notre Dame Law School. He specializes in legal cases related to securities and finances, as well as labor and employment law. In July 2015, Drew founded a law boutique, Stokesbary PPLC, where he now acts as a managing member.
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Why use UpCounsel to hire a Texas S Corporation Formation Attorney?

Confused by complicated questionnaires and government forms? Want to get your questions answered by a real attorney? UpCounsel provides personalized legal services with experienced attorneys to help form your Texas S Corp the right way.
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In the event that you are unsatisfied with the work of an attorney you hired on UpCounsel, just let us know. We’ll take care of it and refund your money up to $5,000 so you can hire another attorney to help you.

Why use UpCounsel to form an S Corporation in Texas

Starting an S Corporation in Texas with a business startup attorney on UpCounsel is easy, informative, and cost-effective. In just three simple steps, our S Corporation attorneys will help you protect your business and personal assets, and help you organize your business for state and federal compliance for an S Corporation.

When forming an S Corporation in Texas with UpCounsel, the attorney you choose to help you will conduct a business name search for your Texas corporation and assist you in preparing your S Corporation Operating Agreement, along with providing other legal services based on your needs. Once your Certificate of Formation For-Profit Corporation have been prepared and successfully filed with the Texas Secretary of State, your Texas corporation has been formed and begins its existence as a Corporation entity.

However, a corporation does not register as an S Corporation with the Secretary of State. It registers as a corporation with the state and then may file for S Corporation status with the IRS. S Corporation status is a taxation category which provides income tax advantages to small businesses.

Requirements for Forming a Texas S Corporation

Choosing a Company Name for Your S Corporation

One of the first steps in the process of forming your Texas S Corporation is to choose your business name.

It must be distinguishable (not the same as or deceptively similar to) the name of any Texas S Corporation reserved or registered and cannot contain the words "bank", "trust", "trustee,""incorporated", "inc.", corporation", or "corp.", or "insurer" or "insurance company" or any other words suggesting that it is in the business of issuing policies of insurance and assuming insurance risks.

Your S Corporation name may contain the name of one or more members.

By using UpCounsel, you can choose several business names in order of preference. Your attorney of choice can then conduct a name check for your Texas S Corporation before filing to see which names are available. Once you have chosen an available name, your chosen S Corporation attorney can help you properly register your name with the State of Texas.

Certificate of Formation: When forming an S Corporation in Texas, the Certificate of Formation must be filed with the Secretary of State. Texas state law requires that certain information be included in your Certificate of Formation when forming your Texas S Corporation.

This information must include:

  1. The S Corporations name.
  2. Address and Name of Registered Agent.
  3. Registered Agent's signed consent form
  4. Purpose for which S Corporation is being formed
  5. Whether S Corporation will be manager-managed or member-managed
  6. Addresses, Names, and Initials of managers or members
  7. Name and addresses of the Board of Directors
  8. The effective date of certificate.

S Corporation Qualification Requirements: For a corporation to qualify as a S Corporation for tax purposes, it must meet the following requirements:

  1. Must be a domestic corporation.
  2. Have only allowable shareholders including individual, certain trusts, and estates; and may not include partnerships, corporations or non-resident shareholders.
  3. Have only one class of stock
  4. Have no more than 100 shareholders
  5. Not be an ineligible corporation (i.e. certain financial institutions, insurance companies, and domestic international sales corporations).

Additionally, a Texas S Corporation formation generally requires inclusion and/or consideration of the following:

Organizers: One or more people may form a S-Corp, yet they do not need to be members of the S Corporation.

Minimum Number of S Corporation Organizers: One (or more).

Eligibility: An organizer may be an individual, partnership, limited partnership, trust, estate, association, corporation, S Corporations, or other entity, whether domestic or foreign.

S Corporation Operating Agreement: Although not required in Texas, it is strongly recommended that a S Corporation with more than one member adopt an operating agreement for the company, which may also be amended and repealed as allowed by the agreement or applicable law. The Certificate of Formation may contain restrictions or prohibitions on the power of the members to adopt, amend, or repeal an operating agreement. If there is more than one member, any operating agreement shall initially be agreed to, in writing, by all of the members.

Eligibility Requirements: A natural person or an entity.

Procedure for Membership: The member may acquire an interest in the S Corporation directly from the corporation at the time of formation and, after formation, at the time provided in and upon compliance with the Certificate of Formation or the operating agreement or, if not provided, only upon the vote of a majority in interest of the S Corporation members, excluding the vote of the person acquiring the membership interest, and only when the person becomes a party to the S-Corp's operating agreement.

Resident Agent needed for a Texas S Corporation

UpCounsel attorneys can also provide your business with a registered agent in Texas. Every Texas S Corporation must have a registered agent in Texas, which is the person or office designated to receive official state correspondence and notice if the company is "served" with a lawsuit. The registered office may be a place of its business.

The company must have the chosen registered agent fill out and sign an acceptance of consent, Form 401-A. This must also be filed with the Secretary of State.

Texas Secretary of State

Once you create an S Corporation in Texas, the Texas Secretary of State will require that certain recurring responsibilities and duties be fulfilled. The most important of these are explained below.

For further information, contact the Texas Secretary of State.

Recurring Responsibilities and Duties for Texas S Corporations

Annual Report: Each S Corporations shall provide an annual report to the Texas Secretary of State regarding its financial condition to each of its members.

Records: Each Texas S Corporations must keep the following records open to inspection at its office:

  1. A current list of the full name and last known business or residence address of each member and of each holder of an economic interest in the S Corporations set forth in alphabetical order, together with the contribution and the share in profits and losses of each member and holder of an economic interest.
  2. If the S Corporations is manager-managed, you will need a current list including the full name and business or residence address of each manager.
  3. A copy of the Certificate of Formation and all amendments thereto, together with any powers of attorney pursuant to which the Certificate of Formation or any amendments thereto were executed.
  4. Copies of the S Corporations's federal, state, and local income tax or information returns and reports, if any, for the six most recent taxable years
  5. A copy of the S Corporations's Operating Agreement, if in writing, and any amendments thereto, together with any powers of attorney pursuant to which any written operating agreement or any amendments thereto were executed.
  6. Copies of the S Corporations's financial statements, if any, for the six most recent fiscal years.
  7. The books and records of internal affairs as they relate to the S Corporations for at least the current and past four fiscal years.
  8. A signed "Incorporator's Statement" showing the names and addresses of the initial directors who will serve on the board until the first annual meeting of shareholders.

Filing Fees for a Texas S Corporation

Filings must be made with the Texas Secretary of State in which the S Corporation was organized, along with the appropriate state filing fee. The filing fee for the Certificate of Formation is $300. Fees are subject to change so make sure you check with the Secretary of State. This may be done online on the Texas Secretary of State's website or by mail.

Taxes for a Texas S Corporation

A Texas S Corporation is a special type of corporation created through an IRS tax election. An eligible corporation can avoid double taxation (once to the corporation and again to the shareholders) by a corporation with a Subchapter S designation by the IRS. A corporation must file a Form 2553 to elect "S" status within two months and 15 days after the beginning of the tax year.

Owners of the S Corporation report business losses or profits on their personal tax returns, and therefore the business itself is not taxed. Each shareholder is responsible for paying taxes on their pro rata share of the S corporation's items of income, deductions, and credits (through a Schedule K-1 form).

Texas state law follows federal law for income tax purposes. Therefore if a corporation is classified as an association taxable as a S Corporation for federal income tax purposes, so will it be taxable as a corporation for state tax purposes.

Federal Income Tax: An S Corporation does not pay federal income tax.

Texas State Income Tax: While Texas does recognize the federal "S" election, S corporations are nevertheless subject to the state's franchise tax. An individual shareholder, however, does not owe state tax on whatever portion of the corporation's net income he or she ultimately receives. S Corporations in Texas are subject to a state franchise tax. In order to be in compliance, you must submit a franchise tax report with a public information report to the Texas Comptroller of Public Accounts. This will be a yearly requirement and annual reports will be due on May 15th every year.

Federal Tax Identification Number: Your corporation will need to obtain a federal tax identification number, which is also known as an Employment Identification Number (EIN). You do not need to get a new EIN after the corporation choose to become a S Corporation. An EIN is similar to an individual's social security number. You will need an EIN for your S Corporation as long as there is one member, even if the S Corporation does not have employees. For certain tax filing requirements the attorney you choose on UpCounsel can help prepare your Federal Tax ID Application, if you have not done so already.

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