How to Form an LLC in Texas

Step-by-step guide to forming an LLC in Texas: filing fee $300, annual costs, registered agent, and state-specific requirements.

Why form an LLC in Texas

If you are researching how to form an LLC in Texas, the process is straightforward and the state keeps ongoing costs low. Texas charges a $300 filing fee for the Certificate of Formation, and there is no annual report to file for most LLCs. The franchise tax applies only when annual revenue exceeds roughly $1.18 million, so the majority of small Texas LLCs owe nothing year after year. An LLC also gives you personal liability protection and pass-through taxation, which is why it is the most popular business structure for new Texas companies. The process takes only a few days from start to finish, and you can complete every step without a lawyer.

Step 1: Choose a business name

Your Texas LLC name must be distinguishable from other names on file with the Secretary of State and must include "Limited Liability Company" or an approved abbreviation such as "LLC." You can search the state business name database before filing. Reserving a name costs $40 and holds it for 120 days while you prepare your paperwork. Avoid words that imply a different business type, such as "bank" or "insurance," unless you hold the appropriate license.

Step 2: Appoint a registered agent

Every Texas LLC must maintain a registered agent with a physical street address in the state. The agent accepts legal documents and official mail on behalf of the business and must be available during normal business hours. You can serve as your own agent, but many owners use a professional registered agent service to keep their home address off public records and make sure documents are never missed.

Step 3: File the Certificate of Formation

The core filing is the Certificate of Formation, submitted online through the SOSDirect system or by mail. The filing fee is $300. You will provide the LLC name, registered agent details, management structure, and organizer information. Online filings are typically approved within a few business days, while mailed filings take longer. The online system is fast, and most owners complete the filing in under an hour. Once approved, the state issues a Certificate of Formation that confirms your LLC legally exists.

Step 4: Draft an operating agreement and get an EIN

Texas does not require an operating agreement, but it is strongly recommended. This document defines ownership percentages, voting rights, profit distribution, and management duties. A well-drafted operating agreement prevents disputes between members and strengthens the liability protection of the LLC. It also helps when you open a business bank account or apply for financing, since lenders often ask to review it.

Most Texas LLCs also need an Employer Identification Number from the IRS, even if there are no employees. The EIN is used to open a business bank account, file taxes, and hire staff. You can apply for an EIN online at no cost through the IRS website. A business bank account keeps personal and business money separate, which is essential for preserving your liability protection.

Texas LLC costs and ongoing requirements

The total cost to start an LLC in Texas is $300 for the state filing, plus optional costs such as name reservation and registered agent fees. There is no annual report. The franchise tax applies only if annual revenue exceeds roughly $1.18 million, and most small LLCs qualify for the no-tax-due tier. Keep a calendar reminder for any filing deadlines so your LLC stays in good standing with the state. Compare these figures with other states in our LLC cost by state guide, and see the full Texas LLC page for more detail.

Frequently Asked Questions

How much does it cost to form an LLC in Texas?

The state filing fee to form an LLC in Texas is $300 for the Certificate of Formation. Optional costs include a $40 name reservation fee and the cost of a registered agent service if you choose not to act as your own agent. There is no annual report fee in Texas, and most small LLCs pay no franchise tax because the tax applies only when annual revenue exceeds roughly $1.18 million. In total, most owners spend between $300 and $400 to get their Texas LLC up and running.

Does Texas require an annual report for LLCs?

No, Texas does not require LLCs to file an annual report. The state does not impose a recurring filing requirement on most LLCs. The only ongoing obligation for most small businesses is the franchise tax, which is due only if annual revenue exceeds roughly $1.18 million. If your LLC crosses that threshold, you must file a franchise tax report each year. For everyone else, there is nothing to file annually, which makes Texas one of the lowest-maintenance states for LLC owners.

Do I need a registered agent in Texas?

Yes, every Texas LLC must have a registered agent with a physical street address in the state. The agent must be available during normal business hours to accept legal documents and official mail. You can serve as your own registered agent, but many owners prefer a professional registered agent service to keep their home address off public records and ensure documents are never missed. The agent name and address appear on the Certificate of Formation.

How long does it take to form an LLC in Texas?

Online filings with the Texas Secretary of State are typically approved within a few business days. Mailed filings take longer, often one to two weeks or more depending on the state processing volume. Once the Certificate of Formation is approved, your LLC legally exists. You can then apply for an EIN, open a business bank account, and begin operating. Expedited processing is available for an additional fee if you need the LLC formed quickly.