How to Start an LLC in Texas: A Step-by-Step Checklist
Starting an LLC in Texas takes nine steps. Four happen before or at filing: pick a name, appoint a registered agent, decide how the company is managed, and file Form 205 with the Texas Secretary of State for $300. Five happen after: sign a company agreement, get an EIN, open a bank account, register for taxes and permits, and put the May 15 Comptroller report on the calendar.
This page is the checklist. Each step links to a longer guide on this site, and Form an LLC in Texas explains why owners choose the structure in the first place.
- Choose a name and check it
- Appoint a registered agent
- Decide: member-managed or manager-managed
- File Form 205 and pay the $300 fee
- Sign a company (operating) agreement
- Get an EIN
- Open a business bank account
- Register for sales tax and local permits
- Calendar the May 15 franchise tax filing
Step 1: Choose a Name and Check It
A Texas LLC name must contain "limited liability company," "limited company," or an abbreviation of one of those phrases, such as LLC or L.L.C. It must also be distinguishable in the Secretary of State's records from the names of existing entities, under Section 5.053 of the Texas Business Organizations Code.
Start with a preliminary name search in SOSPortal, or call the Secretary of State at (512) 463-5555. The Secretary of State is clear that a preliminary clearance is not final: the final determination is made when the filing itself is processed. Our Texas business name search guide covers how to search variations.
If the name is settled but the filing is not ready, Form 501 reserves it for 120 days. The filing fee is $40.
Step 2: Appoint a Registered Agent
Every Texas LLC must name a registered agent and a registered office in its Certificate of Formation. The agent can be an individual Texas resident or a business entity, and the agent must consent to the appointment in writing or electronically.
The registered office must be a physical address in Texas where the agent can be personally served with process during business hours. It cannot be only the address of a mailbox service or a telephone answering service. That address becomes public.
Every one of our monthly plans includes Texas registered agent coverage, starting with Standard at $14.99 a month. See Texas Registered Agent for what the role involves.
Step 3: Decide Member-Managed or Manager-Managed
Form 205 asks one structural question: does the LLC have managers? If yes, the form lists the name and address of each initial manager. If no, it lists each initial member, and the members run the company.
Member-managed is common for owner-operated companies. Manager-managed is common when some owners are investors who do not run day-to-day operations. Our manager vs. member-managed page compares the two.
Step 4: File Form 205 and Pay the $300 Fee
The Texas LLC is created by filing Form 205, the Certificate of Formation for a Limited Liability Company, with the Texas Secretary of State. The filing fee is $300.
Certificates of formation can be filed online through SOSPortal 24 hours a day, 7 days a week. SOSPortal replaced the older SOSDirect system on September 29, 2026, and takes credit card or ACH payment. The form covers the entity name, registered agent and registered office, management, an organizer, and the filing's effectiveness.
Once the Secretary of State accepts the filing, the LLC exists. Our Texas Certificate of Formation page walks through each section of the form, and Texas LLC Fees lists the state fees in one place.
Step 5: Sign a Company (Operating) Agreement
Texas law calls the operating agreement a company agreement. It is not filed with the state. The Secretary of State says no statute permits these documents to be filed, so it cannot accept them, and the company keeps them at its principal office.
The agreement sets ownership percentages, who can sign for the company, how profits are distributed, and what happens when a member leaves or dies. Banks and lenders often ask for it. See Texas LLC Operating Agreement.
Step 6: Get an EIN
An Employer Identification Number is the company's federal tax ID. The IRS issues it online at no cost; the IRS states that you never have to pay a fee for an EIN. Banks generally ask for it when opening a business account.
Our Professional and International+ formation packages include getting the EIN for you. The details are on our Texas LLC EIN page.
Step 7: Open a Business Bank Account
Each bank sets its own document list. Expect to be asked for the filed Certificate of Formation, the EIN, and the company agreement or a banking resolution. Keeping company money in a company account is how the LLC stays separate from its owner on paper. See Texas LLC Bank Account.
Step 8: Register for Sales Tax and Local Permits
A business engaged in business in Texas that sells, leases, or rents taxable goods, or provides taxable services, applies to the Texas Comptroller for a sales tax permit. The application runs through the Comptroller's eSystems, there is no fee for the permit, and the Comptroller says to allow 2-3 weeks. The Comptroller may require a security bond in some cases.
The state sales and use tax rate is 6.25%. Cities, counties, special purpose districts, and transit authorities can add up to 2%, for a maximum combined rate of 8.25%.
Local and industry requirements depend on where the business operates and what it does. One common local requirement is a certificate of occupancy, which Houston, Dallas, Austin, and San Antonio each require for commercial space. Our Texas Business License and Permits page and our city guides for Houston, Dallas, Austin, and San Antonio cover the local side.
If the LLC will operate under a name other than its legal name, it files Form 503, an assumed name certificate, with the Secretary of State. The fee is $25. See Texas DBA and Assumed Name Certificate.
Step 9: Calendar the May 15 Franchise Tax Filing
Texas LLCs do not file an annual report with the Secretary of State. The recurring filing goes to the Texas Comptroller, and it is due May 15 each year. If May 15 falls on a weekend or holiday, the due date moves to the next business day.
Every LLC organized in Texas files Form 05-102, the Public Information Report, each year, even when it owes no franchise tax. An LLC with annualized total revenue above the no-tax-due threshold also files a franchise tax report. For report years 2026 and 2027, that threshold is $2,650,000.
A new LLC's first annual report is due May 15 of the year after the year it became subject to the tax. An LLC formed in 2026 files its first report by May 15, 2027.
Missing the report has consequences. The Comptroller can forfeit the company's right to transact business in Texas, which denies it the right to sue or defend in a Texas court, and each officer, director, member, or owner can become personally liable for certain company debts. See Texas Franchise Tax and Public Information Report.
Where people slip: step 4 gets all the attention, and step 9 gets forgotten. The Public Information Report is due every May 15 even in a year with no revenue. I filed my own first company as the wrong entity type, so I don't assume anything about a checklist until it's done. — Andrew Pierce
Frequently Asked Questions
How much does it cost to start an LLC in Texas?
The Texas Secretary of State charges $300 to file Form 205, the Certificate of Formation for a limited liability company. An optional name reservation on Form 501 costs $40, and an assumed name certificate on Form 503 costs $25. The EIN from the IRS has no fee, and the Comptroller charges no fee for a sales tax permit.
Can I start a Texas LLC online?
Yes. The Secretary of State accepts certificates of formation online through SOSPortal 24 hours a day, 7 days a week. SOSPortal requires its own account, separate from any old SOSDirect login.
Does a Texas LLC file an annual report?
Not with the Secretary of State. The recurring state filing is with the Texas Comptroller: a Public Information Report every year by May 15, plus a franchise tax report when annualized total revenue is above the no-tax-due threshold, which is $2,650,000 for report years 2026 and 2027.
Do I need an operating agreement in Texas?
Texas does not take operating agreements on file. The Secretary of State says no statute permits filing a company agreement, so it cannot accept one, and the company keeps it at its principal office. The agreement is still the document that sets out ownership, authority, and what happens when a member leaves.
Can I be my own registered agent in Texas?
An individual Texas resident can serve as registered agent, but the registered office must be a physical Texas address where the agent can be personally served during business hours. That address goes on the public record.