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Forming a Limited Liability Company (LLC) in Texas is popular for entrepreneurs looking to start or grow their businesses. LLCs offer numerous benefits, including limited liability protection for their owners and flexible management structures. One of the critical steps in forming an LLC is filing the Certificate of Formation with the Texas Secretary of State. This article will provide a comprehensive guide on How to File Certificate of Formation in Texas.
Webinarcare Editorial Team will help you understand the necessary steps to file for Certificate of Formation. It would be best if all the factors in this article guided you.
On this page, you’ll learn about the following:
- What is Certificate of Formation?
- How to File Certificate of Formation in Texas?
- Step 1: Choose a Name for Your LLC
- Step 2: Appoint a Registered Agent
- Step 3: Prepare Your Certificate of Formation
- Step 4: File the Certificate of Formation
- Step 5: Obtain an Employer Identification Number (EIN)
- Step 6: Create an Operating Agreement
- Step 7: Register for State and Local Taxes and Licenses
- Step 8: Maintain Ongoing Compliance
What is Certificate of Formation?
Certificate of Formation is a legal document filed with the Texas Secretary of State to establish a Limited Liability Company (LLC) officially. The Certificate of Formation contains essential information about the LLC, including its name, Registered Agent, and management structure. Once filed and approved by Texas, the LLC becomes a legally recognized business entity, separate from its owners, and benefits from limited liability protection and pass-through taxation.
The Certificate of Formation typically contains the following information:
- Company name
- The effective date of the company
- The headquarters of the company
- The company’s goal
- The period of the company’s operations
- Copy of the name registration certificate for the company
- Registered Agent’s and organizers’ names and addresses
- At least one company employee
Recommended: Filing Certificate of Formation is easy and hassle-free if you hire a professional service. We recommend using –LegalZoom – ($0 + State Fee)
How to File Certificate of Formation in Texas?
Aside from hiring a Registered Agent, you should also be aware that a Registered Agent should file Certificate of Formation in your Texas LLC. Here are the steps and guidelines for filing.
Step 1: Choose a Name for Your LLC
The first step in registering an LLC Certificate of Formation is selecting a unique and appropriate name for your company. Your LLC’s name must comply with your state’s naming requirements, which typically include the following:
- The name must be distinguishable from other registered business names in the state.
- The name must include an LLC designator, such as “Limited Liability Company,” “LLC,” or “L.L.C.“
- The name must not include prohibited words or phrases defined by your state’s regulations.
To ensure your chosen name is available through your state’s business name database, Texas Comptroller of Public Accounts Taxable Entity Search, usually available on the Texas Secretary of State’s website.
Step 2: Appoint a Registered Agent
Registered Agent is a person or entity responsible for receiving official correspondence and legal documents on behalf of your Texas LLC. Most states require LLCs to designate a Registered Agent when filing the Certificate of Formation. The Registered Agent must have a physical address in the state and be available during regular business hours.
Choosing a reliable and responsible Registered Agent is essential, as failure to receive and respond to legal documents can seriously affect your business.
You can serve as your own Registered Agent, appoint a friend or family member, or hire a professional Texas Registered Agent Services.
Step 3: Prepare Your Certificate of Formation
The Certificate of Formation is the legal document that officially establishes your Texas LLC. While the specific requirements in Texas, the document includes the following information:
- The LLC’s name
- The name and address of the Registered Agent
- The principal office address
- The purpose of the LLC
- The management structure (member-managed or manager-managed)
- The names and addresses of the initial members or managers
- The duration of the LLC, if not perpetual
In Texas, additional information may be required, such as an organizer’s signature or specific provisions related to the LLC’s operation.
Consult the Texas guidelines to ensure you include all necessary information.
Step 4: File the Certificate of Formation
Once your LLC Certificate of Formation is prepared, please submit it to the Texas Secretary of State. The submission process may vary depending on the method of choice; Texas allow online submissions and mailing or hand-delivering the documents.
To use the online service or download the Certificate of Formation form for your LLC, go to the website of the Texas Secretary of State. You were required to have an LLC name reserved while completing the form. Visit the Texas Business Name Search to see if the business name you want to use is available there. You must include a copy of your name reservation and your completed Certificate of Formation form when submitting.
It is also possible to mail the form if you wish. Please adhere to the guidelines listed below.
- The Certificate of Formation must be downloaded in the Texas Secretary of State
- Complete the necessary details in the form.
- Two copies of the Certificate of Formation must be completed.
- Include the two papers with the Texas LLC name reservation certificate in a self-addressed, stamped envelope.
- Submit all paperwork to Secretary of State, P.O. Box 13697, Austin, TX 78711-3697.
Costs of Filing Certificate of Formation
Along with the filing of Certificate of Formation, you must pay a filing fee. In Texas, the Certificate of Formation fee costs around $300 which you can pay in the Texas Secretary of State. Confirm the correct fee amount and payment method for your state.
However, If you want to know more about the cost of forming an LLC, you can check out Texas LLC Cost.
Step 5: Obtain an Employer Identification Number (EIN)
After your Certificate of Formation has been filed and approved, you should obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). The EIN is a unique identification number used for federal tax purposes. It is required for most LLCs, especially those with employees or elect to be taxed as an S-Corporation. You can apply for an EIN for free online through the IRS website.
The application of an EIN in Texas can be through the following:
- Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
- Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that the Form SS-4 contains all of the required information.
- Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
- Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.
Recommended: Professional services have the EIN included in their LLC formation package. We recommend using –LegalZoom – ($0 + State Fee for LLC formation)
Step 6: Create an Operating Agreement
Although most states do not require an LLC Operating Agreement when registering an LLC, having one is highly recommended. The Operating Agreement in Texas is a legally binding document that outlines the LLC’s ownership structure, management, and operating procedures. It helps prevent member disputes and provides a clear framework for the LLC’s operations.
Step 7: Register for State and Local Taxes and Licenses
In Texas, you may need to register for additional state and local taxes or obtain specific licenses and permits. Common registrations include sales tax, payroll tax, and unemployment insurance tax. As an LLC, your business income will be subject to pass-through taxation, meaning profits and losses will be reported on your tax return. However, you may still be responsible for other state taxes, such as sales tax, payroll tax, or franchise tax which you can pay in Texas Comptroller of Public Accounts.
In terms of franchise tax for your LLC in Texas, there is $400 minimum. Consult your Texas Comptroller of Public Accounts and local government offices to determine which registrations and licenses apply to your LLC.
Step 8: Maintain Ongoing Compliance
Once your LLC is registered and operational, it’s essential to maintain ongoing compliance with state regulations. This typically includes filing Annual Reports in Texas, paying required fees every 1 year, and keeping accurate records of your LLC’s activities. Stay informed about Texas specific requirements to ensure your LLC remains in good standing.
Is the Certificate of Formation necessary to be filed in Texas?
Yes, the Certificate of Formation is necessary to be filed with Texas Secretary of State to legally establish and register a new business entity, such as a corporation or limited liability company (LLC). This document typically includes the company’s name, purpose, Registered Agent, and stock structure. Filing the Certificate of Formation is essential in forming a business and ensuring it operates legally and is recognized by Texas.
What is the best way to file Certificate of Formation? Is it online or by mail?
The best way to file Certificate of Formation depends on your specific situation and the state in which you are incorporating your business. Both online and mail-in options have advantages, and either method can be effective.
- Faster processing time, as it is usually processed within a few days or even hours.
- Immediate confirmation of submission and payment.
- Lower risk of errors, as the online form may provide guidance and prevent incomplete submissions.
- Some people prefer the traditional method and feel more comfortable with paper documentation.
- You can include a cover letter or additional documentation if you have specific questions or complex situations.
To determine the best method for your needs, check the Texas Secretary of State or similar department’s website for information on their preferred filing options and processing times. Online filing is more convenient and efficient, but both methods can be used effectively to submit your Certificate of Formation.
- File Certificate of Formation in Alabama
- File Articles of Organization in Alaska
- File Articles of Organization in Arizona
- File Certificate of Organization in Arkansas
- File Articles of Organization in California
- File Articles of Organization in Colorado
- File Certificate of Organization in Connecticut
- File Articles of Organization in DC
- File Certificate of Formation in Delaware
- File Articles of Organization in Florida
- File Articles of Organization in Georgia
- File Articles of Organization in Hawaii
- File Certificate of Organization in Idaho
- File Articles of Organization in Illinois
- File Articles of Organization in Indiana
- File Certificate of Organization in Iowa
- File Articles of Organization in Kansas
- File Articles of Organization in Kentucky
- File Articles of Organization in Louisiana
- File Certificate of Formation in Maine
- File Articles of Organization in Maryland
- File Certificate of Organization in Massachusetts
- File Articles of Organization in Michigan
- File Articles of Organization in Minnesota
- File Certificate of Formation in Mississippi
- File Articles of Organization in Missouri
- File Articles of Organization in Montana
- File Certificate of Organization in Nebraska
- File Articles of Organization in Nevada
- File Certificate of Formation in New Hampshire
- File Certificate of Formation in New Jersey
- File Articles of Organization in New Mexico
- File Articles of Organization in New York
- File Articles of Organization in North Carolina
- File Articles of Organization in North Dakota
- File Articles of Organization in Ohio
- File Articles of Organization in Oklahoma
- File Articles of Organization in Oregon
- File Certificate of Organization in Pennsylvania
- File Articles of Organization in Rhode Island
- File Articles of Organization in South Carolina
- File Articles of Organization in South Dakota
- File Articles of Organization in Tennessee
- File Certificate of Formation in Texas
- File Certificate of Organization in Utah
- File Articles of Organization in Vermont
- File Articles of Organization in Virginia
- File Certificate of Formation in Washington
- File Articles of Organization in West Virginia
- File Articles of Organization in Wisconsin
- File Articles of Organization in Wyoming
Can You Change or Modify Your Texas LLC Certificate of Formation?
Setting up a limited liability company (LLC) in Texas can be an exciting prospect for aspiring entrepreneurs or businesses looking to establish a presence in the Lone Star State. However, as circumstances change and company objectives evolve, it is often necessary to modify or change the initial LLC certificate of formation to accommodate new business realities. So, can you really change or modify your Texas LLC certificate of formation? Let’s find out.
The certificate of formation is a crucial document filed with the Texas Secretary of State that officially establishes the existence of an LLC. It outlines important information about the company, such as the name, purpose, registered agent, members, and capital contributions. Once filed, the certificate becomes an essential part of the public record and serves as a legal foundation for the LLC’s operations.
While the certificate of formation lays the groundwork for an LLC, it is not a rigid and unalterable contract. Texas law recognizes that businesses need flexibility to adapt to changing circumstances, which is why amendments and modifications are allowed.
To change or modify your Texas LLC’s certificate of formation, you must follow a specific process outlined by the Texas Business Organizations Code (BOC). Anyone seeking modifications to the document, including new members, changes in member percentages, alterations to business purpose, or a change in the company name, will need to file the appropriate amendment paperwork with the Secretary of State.
To begin the process, you will need to obtain the necessary forms from the Texas Secretary of State’s office or their official website. These forms, such as the Certificate of Amendment, provide spaces to fill in the relevant information and clearly define the amendments being made to the certificate of formation.
Upon completing the required amendment forms, they must be signed and submitted to the Texas Secretary of State, along with the appropriate filing fee. It is worth noting that the fees can vary depending on the type and extent of the modification being made, so it is advisable to consult the updated fee schedule provided by the Secretary of State’s office before submitting your forms.
Once your amendments are filed, the Secretary of State will review the documents for compliance. If successfully approved, the amended certificate of formation will then become the new official record of your LLC. This revised document is crucial for maintaining legal and operational transparency and can help ensure that your company’s records accurately reflect its current structure and activities.
In conclusion, the process of changing or modifying your Texas LLC certificate of formation is both legally permissible and relatively straightforward. Thanks to the Texas BOC, LLC owners have the opportunity to adapt their businesses as needed, allowing for adjustments to reflect evolving goals, ownership structures, or any other relevant changes. By following the appropriate filing procedures and meeting the necessary requirements, you can ensure that your LLC’s certificate of formation fully reflects the present condition of your company – safeguarding its transparency while providing a comprehensive foundation for sustainable growth.
Registering an LLC Certificate of Formation is critical in establishing your business as a legally recognized entity. By following this comprehensive guide and researching your state’s specific requirements, you can successfully navigate the registration process and set your LLC up for success. Remember that forming an LLC is just the beginning; ongoing compliance and diligent management are necessary to ensure your business thrives in the long run.