How Much Does It Cost to Start an LLC in Texas?

Texas LLC Filing Fee: $300

The main cost to start an LLC in Texas is the $300 fee to file your LLC's Certificate of Formation online with the Texas Secretary of State.

For a look at LLC cost in every state, read our other Cost to Start an LLC and How to Form an LLC guides.

Cost to Form a Foreign LLC in Texas: $750

If you already have an LLC business structure that is registered in another state and you’d like to expand your business into Texas, you’ll need to register a foreign LLC in Texas.

The cost for registering a Texas foreign LLC is $750. You can register a foreign LLC in Texas by filing an Application for Registration of a Foreign Limited Liability (Form 304).

Optional LLC Formation Costs

There are optional fees associated with LLC formation:

LLC Name Reservation

You can reserve a name for up to 120 days prior to starting your LLC by filing Form 501 and paying the $40 filing fee. To renew a name reservation, resubmit Form 501 within 30 days of the original expiration date. 

Assumed Name

File an Assumed Name Certificate and pay the $25 filing fee to create a name other than your legal LLC business name.

Seven Basic Steps to Start an LLC in Texas

Step 1: Name Your Texas LLC
Step 2: Choose a Registered Agent
Step 3: File a Certificate of Formation
Step 4: Create an Operating Agreement
Step 5: Get an EIN
Step 6: File an Annual Report
Step 7: Keep Your Company Compliant

Step 1: Name Your Texas LLC

Starting a new Limited Liability Company (LLC) in Texas is an exciting venture, but before you can officially launch your business, there are a few critical steps you need to complete. One of the most important initial decisions you'll need to make is selecting an appropriate name for your Texas LLC.

Your LLC's name is a crucial part of your brand identity; it's the way your customers will identify and remember your business. Moreover, it is also a legal requirement to have a unique and suitable name when you register your LLC in Texas.

This first step will guide you on how to pick an appropriate and unique name for your Texas LLC that not only meets the state's naming requirements but is also available as a web domain.

Part of the LLC formation process is that the name of your Texas LLC has to satisfy certain legal criteria established by the Texas Secretary of State.

Furthermore, it's important to ensure that the chosen name is available as a web domain.

With the increasing reliance on digital platforms for business operations, securing a matching web domain for your LLC will not only enhance your online presence but also make it easier for potential customers to find your business online.

Choose a Texas LLC name that:

1. Is available for use in the state of Texas
2. Meets Texas naming requirements
3. Is available as a web domain

Recommended: Visit our Start an LLC in Texas guide for detailed naming rules and instructions for registering a business name in Texas.

Not sure what to name your business? Check out our How to Name a Business guide and free LLC Name Generator.

We recommend that you check online to see if your business name is available as a web domain. Even if you don't plan to create a business website today, you may want to buy the URL in order to prevent others from acquiring it.

Step 2: Choose a Registered Agent

All LLCs in Texas must appoint a registered agent. A registered agent primarily acts as your LLC’s main point of contact with the state. But most importantly, they are responsible for accepting service of process in the event your business is sued.

Though you can be your own registered agent if you're a Texas resident to avoid paying a registered agent fee, most business owners choose to use a registered agent service. The Texas LLC operating agreement for your business should outline who will serve as your registered agent. This person will be responsible for handling legal documents from the state.

Your Texas registered agent must be:

• At least 18 years or older
• Have a physical address in Texas
• Available during normal business hours to accept service of process

In Texas, your registered agent must consent to appointment.

Step 3: File the Certificate of Formation

Texas Form 205 - Certificate of Formation is a document that is filed with the Texas Secretary of State to form an LLC. The fee for filing a Certificate of Formation is $300 online.

For detailed instructions for completing the Certificate of Formation, visit our How to File the Texas Certificate of Formation guide.

Step 4: Create an Operating Agreement

An operating agreement, known in Texas as a company agreement, isn’t required for Texas LLCs, but it’s a good practice to have one.

What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.

Why are operating agreements important? A comprehensive operating agreement ensures that all business owners are on the same page and reduces the risk of future conflict.

For more information on operating agreements, read our Texas LLC operating agreement guide.

Step 5: Get an EIN

What is an EIN? An EIN or Employer Identification Number is a nine-digit number issued by the Internal Revenue System (IRS) to identify a business for tax reporting purposes. An EIN is essentially a Social Security number (SSN) for your company.

Why do I need an EIN? An EIN number is required for the following:

• Opening a business bank account
• Hiring employees

Step 6: File Your Texas Annual Report

In Texas, the annual report consists of two filings: the Public Information Report (PIR) and the Annual Franchise Tax Report. These are both filed with the Texas Comptroller of Public Accounts by May 15 each year.

There is no set filing fee for these forms, as your Texas franchise tax payment will ultimately depend on your LLC’s total revenue. That being said, most businesses will end up filing a “No Tax Due” report. Veteran-owned LLCs are also eligible to have their franchise tax waived for up to five years.

For more information, see our Texas LLC Annual Report guide.

Important: Persistent failure to file could lead to the dissolution of your Texas LLC.

Step 7: Keep Your Company Compliant

Understanding compliance requirements is crucial when forming or operating a Texas Limited Liability Company (LLC). Here are key areas to focus on, ensuring your LLC aligns with Texas laws and thus, avoiding potential penalties:

• Business Licenses & Permits: Your Texas LLC must conform to federal, state, and local government regulations. Fees and requirements vary based on your specific business. Visit the Texas Economic Development website for detailed information on licenses and permits relevant to your LLC.
• Texas LLC Tax Obligations: Timely tax payment is essential for your LLC. Depending on your business nature, registration for one or more state taxes may be necessary, such as sales tax and/or Unemployment Insurance Tax. Note that Texas doesn't require a state income tax, but federal income tax reporting is mandatory. Visit the Texas Comptroller of Public Accounts website for more tax-related information.
• Hiring Employees: Complying with various laws and regulations is required when hiring employees for your Texas LLC. These include verifying new employees' eligibility to work in the US, reporting new hires to the state, providing workers' compensation insurance, withholding employee taxes, and visibly displaying compliance posters in the workspace. 

Incorporating these key elements into your business practice will help ensure your LLC's compliance with Texas law.