How to File an LLC in Texas: A Step-by-Step Guide

3 hours ago

3 min read

Hello, I’m Taylor Willingham with the Willingham Law Firm. Today, I’ll guide you through the basics of filing an LLC in Texas. While I always encourage people to seek legal advice, I understand that many new business owners may not be able to afford an attorney right away. If you’re in that position, this guide will help you get started by filing the essential documents to establish your LLC, so you can open a bank account and officially kick off your business.

Step 1: Visit the Secretary of State’s Website (SOS Direct)

Your first stop is SOS Direct, the Texas Secretary of State’s website, at sos.state.tx.us.

Here, you’ll find everything you need for online business filings.

Go to SOS Direct and create an account if you don’t already have one.
Once logged in, navigate to Business Filings.
Under Online Searching and Filing, you’ll have the option to register a business online. While the online process is convenient, you can also download forms if you prefer to mail them in and save on service fees.

Step 2: Check Your Business Name Availability

Before filing, confirm that your desired business name is available:

In SOS Direct, use the Business Name Search feature to see if your chosen name is already in use. Remember, your LLC’s name cannot be too similar to an existing business unless you obtain permission from that company.
Conducting a name search incurs a small fee. Although it’s an added cost, it’s a critical step to avoid legal issues down the line.

Step 3: Select and Complete the Right Form

For LLC formation, you’ll need Form 205: Certificate of Formation for a Limited Liability Company.

Under Forms and Filings, go to Business and Non-Profit Forms.
Select Form 205 for a standard LLC. If you’re a professional (e.g., attorney, CPA, doctor), you’ll need Form 206: Certificate of Formation for a Professional LLC.

The filing fee is $300, which you’ll need to pay whether you submit the form online or by mail.

Step 4: Complete Key Sections of Form 205

Here’s a quick overview of what you’ll fill out on the form:

LLC Name: Be sure to include “LLC” or “Limited Liability Company” in the name.
Registered Agent: This is the person or company responsible for receiving legal documents on behalf of your business. If you’re a solo owner, you can appoint yourself, or you can hire a professional registered agent service.
Management Structure: If you’re the sole member of the LLC, select that it will not have managers. If your LLC has multiple members, consult with an attorney to decide on the best structure.
Purpose: Describe the nature of your business.
Organizer Details: Enter your name and address as the organizer.
Effective Date: Choose the date you’d like the LLC to become active, or leave it as the date the Secretary of State files the paperwork.

Once you’ve filled everything out, print, sign, and mail the form with a check for $300 if you’re not filing online.

Step 5: Apply for an EIN (Employer Identification Number)

To legally operate your business, you’ll need an EIN (Employer Identification Number) from the IRS. This number is essential for opening a bank account, hiring employees, and filing taxes.

Visit IRS.gov and search for "Apply for an EIN."
Follow the online application process, which is straightforward and free.

Additional Tips

Online Filing Fees: Filing your LLC online will incur an additional processing fee beyond the $300 state fee.
Avoid Credit Card Surcharges in Business: Note that while businesses cannot legally charge fees for credit card transactions, the state does apply these fees for online services.

Get Professional Help for Complex Matters on How to File an LLC in Texas

While this guide provides the basics for filing an LLC in Texas, forming a business can be complex, especially if you have unique needs or questions. If you’re considering a more intricate setup or need advice on structuring your LLC, feel free to contact us at the Willingham Law Firm. We’re here to help you make informed decisions about your business future.