Updated May 5, 2022:

Texas single member LLC filing requirements include paying a franchise tax and possibly state employment taxes. Single member LLCs in Texas are not required to file an annual report.

Introduction to Texas Single Member LLCs

Like many states, Texas allows for the formation of single member LLCs, and in fact, these entities are extremely common in this state. The IRS considers a single member LLC to be a disregarded entity. Essentially, this means that single member LLCs are taxed in the same way as sole proprietorships. Members of the single member LLC will report the losses and profits of the company on the Schedule C form of their personal tax return. Some single member LLCs choose to be taxed as an S Corporation or a C Corporation instead of accepting disregarded entity status.

Both single member LLCs and multi-member LLCs provide the exact same liability. Whichever type of LLC you decide to form, owners of the company will not be held personally liable for the debts or obligations of the company. If an LLC is sued and loses the lawsuit, the personal property of the LLC members is not at risk.

Forming a Single Member LLC in Texas

Forming your single member LLC in Texas is actually very simple and straightforward. After completing a few easy steps, your LLC will be established, and you will enjoy limited liability protections.

The first step you need to take when forming your LLC is choosing a name for your company. In addition to choosing a unique name that cannot be confused with the names of other Texas LLCs, your company name needs a designator indicating its entity status:

  • Limited Liability Company
  • Limited Company
  • L.L.C., Ltd. Co., or L.C.

Search either the Comptroller of Public Accounts or the SOS website to make sure the name you have selected hasn't already been registered. You can reserve the name of your LLC for 120 days by filing Form 501 and paying a $40 fee.

Next, you need to file your Certificate of Incorporation. You should file this document with the Texas Secretary of State after making sure it includes the following information:

  • The name of your single member LLC
  • Contact information for your Registered Agent
  • An indication of your management structure
  • Contact information for each managing member or outside manager
  • Contact information for the organizer of your LLC

A blank certificate can be downloaded from the SOS website, and you will need to pay a $300 filing fee when submitting this document. Before filing your Certificate of Formation, make sure that you have appointed a Registered Agent, which is a requirement of every LLC in Texas. You can choose an individual who is a Texas resident as your Registered Agent, or you can appoint a business entity that is allowed to transact business in the state.

Single member LLCs are not permitted to serve as their own Registered Agent, and the Registered Agent must possess a physical Texas street address. Registered Agents are not allowed to only have a P.O. Box.

Texas LLC Filing Requirements

The Texas single member LLC filing requirements are different from those in other states. For example, Texas single member LLCs do not need to file an annual report. You will be required, however, to submit an annual franchise tax report.

In general, single member LLCs are pass-through entities, which means the organization itself does not pay taxes. With an LLC, the members of the entity are responsible for reporting and paying federal income taxes on the losses and profits of the company. While your Texas LLC may not need to pay federal income taxes, you will likely be required to pay a state franchise tax.

Texas LLCs will pay their state franchise tax to the Texas Comptroller of Public Accounts. Your LLC's net surplus is the basis for the franchise tax. The net surplus is your LLC's net assets minus the contributions made by members. If you do not owe a franchise tax, you need to file Form 05-0163. On the other, hand if you do owe the franchise tax, determining which form that you need to file can be complicated. You can reference the Texas Comptroller website for help deciding which form you should file.

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