Texas LLC FAQs: Formation, Costs, and Compliance

The Texas Secretary of State charges a $300 filing fee for a Certificate of Formation (Form 205). That's the only mandatory state cost to form your LLC. There's no publication requirement and no additional state fee at formation.

If you want your LLC formed faster, expedited processing is available for an additional $50 and can reduce the turnaround to as few as 2 business days.

It depends on how you file. Standard processing through the Texas Secretary of State generally takes up to 5–7 business days after your Certificate of Formation is received. Expedited processing, available for an additional $50, can reduce that to as few as 2 business days.

Online filing through the Secretary of State's SOSDirect system tends to move faster than mailed submissions, since mailed filings add transit time on both ends.

To form a Texas LLC, file a Certificate of Formation for a Limited Liability Company (Form 205) with the Texas Secretary of State and pay the $300 state fee. You can file online through SOSDirect or mail the completed form to the Secretary of State's office.

Form 205 requires your LLC's exact legal name (including an LLC designator like "LLC" or "Limited Liability Company"), your registered agent's name and Texas street address, and your chosen management structure — member-managed or manager-managed.

No. The Texas Secretary of State charges a mandatory $300 filing fee for Form 205, and there's no way to waive it. What you can avoid paying is a preparation fee — we file your LLC formation documents at no additional charge, so you pay the $300 state fee and nothing more for the basic filing.

Form 205 is the Certificate of Formation for a Limited Liability Company — the official document you file with the Texas Secretary of State to legally create your LLC. It's the Texas equivalent of what other states call Articles of Organization. Filing Form 205 with the $300 state fee is what formally brings your LLC into existence.

Your Texas LLC name must include a recognized designator — "Limited Liability Company," "Limited Company," "LLC," "L.L.C.," "LC," or "L.C." — and it must be distinguishable in the Texas Secretary of State's records from all existing entity names, reserved names, and registered fictitious names.

"Distinguishable" doesn't mean completely different — differences in key words or word order can be enough. But if your proposed name is too similar to an existing one, the Secretary of State can reject your filing. Check availability through the SOSDirect name search before you file.

Yes. Texas law requires every LLC to maintain a registered agent and a registered office address in Texas at all times. The registered agent receives legal process, state notices, and official correspondence on behalf of your LLC.

Your registered agent must be either an individual Texas resident or an organization authorized to do business in Texas. The registered office must be a physical Texas street address — a P.O. box doesn't qualify. An owner, officer, or employee of the LLC can serve as registered agent, but the LLC itself cannot.

It depends on your LLC's structure. A single-member LLC with no employees can use the owner's Social Security number for federal tax purposes, but an Employer Identification Number (EIN) is required if your LLC has more than 1 member, plans to hire employees, or elects to be taxed as a corporation.

Getting an EIN is free. Apply online through the IRS and you'll receive your EIN immediately after completing the session. You can also apply by filing IRS Form SS-4 by fax or mail.

No. Texas doesn't require an LLC to have a written operating agreement to form or maintain the business. But if you don't have one, your LLC's internal affairs are governed by the default rules in the Texas Business Organizations Code — which may not reflect how you actually want to run things.

For multi-member LLCs especially, a written operating agreement is worth having — it defines each member's ownership percentage, voting rights, and how decisions get made, which helps prevent disputes later. The agreement stays with your company records and isn't filed with the state.

Texas requires you to declare your LLC's management structure in Form 205 at formation. You choose between member-managed — where all members participate in running the business — and manager-managed, where authority is assigned to one or more designated managers who may or may not be members.

Most small LLCs with active owners choose member-managed. Manager-managed structures make more sense when some members are passive investors who don't want day-to-day involvement, or when you want to bring in an outside manager.

Yes. Most Texas LLCs must file an annual franchise tax report with the Texas Comptroller of Public Accounts by May 15 each year — even if no tax is owed. LLCs with annualized total revenue at or below $2,650,000 fall under the no-tax-due threshold and owe nothing, but the filing is still required.

If your revenue exceeds the threshold, franchise tax is calculated on your LLC's taxable margin. The no-tax-due threshold is adjusted periodically, so check the Texas Comptroller's website for the current figure.

No. Texas LLCs don't file an annual report with the Secretary of State the way many other states require. The main ongoing filing is the annual franchise tax report — and the Public Information Report that goes with it — filed with the Texas Comptroller by May 15 each year.

Yes. Texas allows series LLCs. A series LLC has one parent LLC with individual series underneath it, each treated as a separate legal entity with its own assets, liabilities, and members. This structure is used most often in real estate to hold multiple properties under one umbrella while keeping each property's liability separate.

It depends on your situation. Texas recognizes LLCs, S Corporations, and C Corporations as the main for-profit entity types. For most entrepreneurs starting out, an LLC offers a practical balance: personal liability protection, pass-through taxation by default, and less administrative overhead than a corporation.

If you're planning to raise outside investment or issue stock, a C Corporation may be a better fit. A tax professional can help you figure out which structure makes the most sense for your specific business and tax situation.

To change your registered agent in Texas, file Form 401 — Statement of Change of Registered Agent — with the Texas Secretary of State. The form can be filed online through SOSDirect or by mail. There is a state fee for this filing.

By default, a Texas LLC is taxed as a pass-through entity — profits flow to the members' personal tax returns, not to the LLC itself. Texas has no state income tax, so there's no state-level income tax on LLC earnings. The main state-level tax obligation is the franchise tax, filed annually with the Texas Comptroller.

At the federal level, LLC members typically pay self-employment tax on their share of business income, plus federal income tax. If your LLC has employees, payroll tax obligations apply. A tax professional can help you figure out the full picture for your business.