How to Start an LLC in Texas: Step-by-Step Guide (2026)

Texas has long been one of the most business-friendly states in the country — and for good reason. No state income tax, a massive consumer base, and a regulatory environment that generally stays out of entrepreneurs’ way have made it a magnet for startups, side hustlers, freelancers, and established companies alike. According to the Texas Secretary of State, hundreds of thousands of new business entities are registered in the state every year, and that number has continued to climb through 2025 and into 2026.

If you’re reading this, you’re probably ready to join them. This guide will walk you through exactly how to start an LLC in Texas — step by step, with real costs, timelines, and the occasional hard-won observation from someone who has been through this process more than once. Services like Northwest Registered Agent can handle the entire Texas filing for as little as $39 plus the $300 state fee, but you should understand the full process regardless of whether you DIY or hire help.

Whether you’re launching a real estate holding company in Houston, a consulting firm in Austin, or a home services business in Dallas, the formation process is largely the same. Let’s get into it.

Why Form an LLC in Texas?

Before diving into the mechanics, it’s worth a quick moment on the why — because understanding the strategic logic helps you make better decisions during the setup process.

A limited liability company (LLC) gives you personal liability protection, meaning your personal assets (home, car, savings) are generally shielded if your business faces a lawsuit or debt. That protection alone is worth the formation fee for most entrepreneurs. Beyond liability, a Texas LLC offers:

Pass-through taxation: By default, LLC profits and losses pass through to your personal tax return. You avoid the double taxation that C-corporations face.
Flexible management structure: Unlike corporations, LLCs don’t require a board of directors, annual meetings, or rigid officer roles.
No state income tax: Texas imposes no personal or corporate income tax, though LLCs with gross receipts over $2.47 million (as of the 2026 threshold) may owe the Texas Franchise Tax.
Strong legal precedent: Texas courts have well-developed LLC case law, which gives you predictable legal outcomes.

If you’re weighing whether an LLC is the right structure at all, our guide on LLC vs. Sole Proprietorship breaks down the trade-offs in plain terms.

Step 1: Choose a Name for Your Texas LLC

Your LLC name is both a legal requirement and a branding decision. Texas has specific naming rules you must follow:

The name must include an LLC designator. Acceptable options include “Limited Liability Company,” “LLC,” or “L.L.C.” Texas also permits “Ltd. Co.” and similar variations.
The name must be distinguishable from any other registered entity in Texas. You can check availability using the Texas Secretary of State’s SOSDirect database.
Restricted words require approval. Terms like “bank,” “insurance,” or “university” require additional licensing or agency approval.
Check federal trademark availability. The USPTO database is a must-check before you commit to a name — a state filing won’t protect you from federal trademark infringement claims.

If you find a name you want but aren’t ready to file yet, Texas allows you to reserve a business name for 120 days by filing an Application for Reservation or Renewal of Reservation of an Entity Name (Form 501) and paying a $40 fee.

Pro tip: Also check whether the matching domain name and social media handles are available. I’ve seen too many business owners get emotionally attached to a name only to discover the .com has been parked since 2009. Sort that out before you file anything.

Step 2: Appoint a Texas Registered Agent

Every Texas LLC is required to maintain a registered agent — a person or company authorized to receive legal notices, service of process, and official government correspondence on behalf of your business.

Your registered agent must:

Have a physical street address in Texas (P.O. boxes are not permitted)
Be available during normal business hours
Be either an individual Texas resident or a business entity authorized to operate in Texas

You can serve as your own registered agent, but there are practical reasons most serious business owners don’t. If you’re served with a lawsuit, it will be delivered in person — potentially in front of employees or clients. And if you ever move or are temporarily unavailable, you risk missing critical legal notices.

For a deeper look at what registered agents actually do and what to look for when choosing one, see our guide on what a registered agent is.

Top registered agent options for Texas LLCs:

Northwest Registered Agent — Consistently our top pick. $125/year for registered agent service, strong privacy protections, and exceptional customer support. Their policy of not selling your data is a real differentiator. Read our full Northwest Registered Agent review.
ZenBusiness — Includes registered agent service free for the first year on most plans. Good value for new businesses.
Bizee — Includes one year of free registered agent service with all formation packages.

Step 3: File the Certificate of Formation with the Texas Secretary of State

This is the official step that legally creates your LLC. In Texas, the formation document is called the Certificate of Formation (Form 205 for domestic LLCs). You’ll file it with the Texas Secretary of State.

What to include in your Certificate of Formation:

LLC name and principal office address
Name and address of your registered agent
Whether the LLC is member-managed or manager-managed
Name and address of each organizer
Whether the LLC will have a series structure (for real estate investors, this can be a powerful tool)
Effective date (can be set up to 90 days in the future)

Filing options and fees:

Method	Filing Fee	Processing Time
Online (SOSDirect)	$300	3–5 business days
Mail	$300	5–7 business days
In-person (Austin)	$300	Same day or next day
Expedited (online)	$325	24 hours

The standard state filing fee for a Texas LLC is $300 — one of the higher base fees among U.S. states. However, given Texas’s tax advantages, the total cost of ownership for a Texas LLC typically compares favorably over time.

Once your Certificate of Formation is approved, you’ll receive a stamped copy from the Secretary of State. Store this document carefully — you’ll need it to open a business bank account, apply for licenses, and sometimes for lending purposes.

Step 4: Draft an Operating Agreement

Texas does not legally require an LLC to have an operating agreement, but this is one of those areas where legal requirements and practical wisdom diverge sharply.

In my experience, the operating agreement is the single most important document in your LLC’s life. It defines how the business is owned, how profits are distributed, how major decisions are made, and what happens if an owner wants to exit — or dies. Without one, Texas’s default LLC rules govern all of these scenarios, and the default rules are rarely what business owners actually want.

What a good operating agreement covers:

Ownership percentages (membership interests)
Voting rights and decision-making thresholds
Capital contribution requirements
Profit and loss distribution rules
Manager vs. member-managed designation
Procedures for adding or removing members
Buyout provisions and valuation methodology
Dissolution procedures

For single-member LLCs, an operating agreement still matters — it helps establish that the LLC is a separate legal entity from you personally, which is critical for maintaining liability protection and supporting a potential S-Corp election down the road.

Our LLC Operating Agreement guide walks through the key provisions in detail. If your business has multiple members or any complexity at all, have an attorney review or draft this document. The cost is trivial relative to the disputes it prevents.

Step 5: Obtain an EIN from the IRS

An Employer Identification Number (EIN) is essentially a Social Security number for your business. You’ll need it to:

Open a business bank account
Hire employees
File federal and Texas state taxes
Apply for business licenses
Set up a business credit profile

The IRS issues EINs for free through its online application system. The process takes about 10 minutes and you receive your EIN immediately upon completion. There is no reason to pay a third party for EIN acquisition — it’s a free government service.

One nuance: If you’re a single-member LLC with no employees, you technically don’t need an EIN — you can use your Social Security number for tax purposes. But you should still get one. Using your SSN for business purposes exposes it unnecessarily and can complicate banking.

Step 6: File Your BOI Report with FinCEN

This step is new for many business owners and frequently overlooked. Under the Corporate Transparency Act, most LLCs formed in the United States — including Texas LLCs — are required to file a Beneficial Ownership Information (BOI) Report with the Financial Crimes Enforcement Network (FinCEN).

The report identifies the individuals who ultimately own or control the LLC (beneficial owners). As of 2026, the filing requirements and deadlines have continued to evolve — enforcement has been reaffirmed after a period of legal uncertainty in 2024 and 2025.

Key BOI facts for Texas LLC owners:

LLCs formed before January 1, 2024 had an original deadline of January 1, 2025 (check FinCEN for current status if you missed this)
LLCs formed on or after January 1, 2024 must file within 90 days of formation
Filing is free and done through FinCEN’s online portal
Penalties for non-compliance can be significant — up to $591 per day (adjusted for inflation) and potential criminal liability

For a complete breakdown of deadlines, exemptions, and how to file, see our BOI Report Guide.

Step 7: Open a Business Bank Account and Handle Licensing

Business bank account: This is a non-negotiable step for protecting your liability shield. Commingling personal and business funds is one of the primary ways courts “pierce the corporate veil” — meaning they can hold you personally liable for business debts despite having an LLC. Open a dedicated business checking account as soon as you have your EIN and Certificate of Formation.

Business licenses: Texas does not have a general state business license, but depending on your industry and location, you may need:

A Texas Sales and Use Tax Permit (free, through the Texas Comptroller) if you sell taxable goods or services
Professional licenses (contractors, healthcare providers, food service, etc.)
Local city or county business permits

Check the Texas Business Licenses & Permits portal for a customized list based on your business type and location.

Texas Franchise Tax: If your LLC’s annual gross receipts exceed $2.47 million (2026 threshold), you’ll owe the Texas Franchise Tax, reported via an annual Public Information Report (PIR) filed with the Texas Comptroller. Even LLCs below the threshold must file a no-tax-due report if they received a notice. Mark your calendar — the annual deadline is May 15.

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

Let’s put real numbers on this. Here’s a realistic cost breakdown for a Texas LLC in 2026:

Item	Cost
Certificate of Formation (state fee)	$300
Registered agent service (Year 1)	$0–$125
Operating agreement (DIY vs. attorney)	$0–$1,500+
EIN	$0 (free)
BOI Report filing	$0 (free)
Business bank account	$0–$25/month
Total minimum (DIY)	$300
Total with professional service	$400–$800

For a deeper dive on costs across all states and formation scenarios, see our guide on how much it costs to form an LLC.

Best LLC Formation Services for Texas

If you’d rather not navigate the Secretary of State’s portal yourself, several reputable formation services can handle the filing for you. Here are the options we recommend for Texas:

Northwest Registered Agent — Our top overall pick. Northwest handles your Certificate of Formation filing, serves as your registered agent, and gives you access to compliance tools. Their $39 base formation price (plus the $300 state fee) is competitive, and their customer service is genuinely excellent — a rarity in this industry. See our Northwest Registered Agent review for full details.

ZenBusiness — A strong choice for budget-conscious founders. Their Starter plan is $0 (plus state fees) and includes registered agent service free for the first year. ZenBusiness has processed millions of formations and their dashboard makes ongoing compliance straightforward. Read our ZenBusiness review.

Bizee — Formerly Incfile, Bizee offers a free formation tier (state fees apply) with one year of free registered agent service included. Good option if you want a no-cost entry point.

LegalZoom — The most recognizable name in the space. Pricier than the alternatives, but offers broad legal service add-ons if you anticipate needing attorney consultations. Read our LegalZoom review.

LLC Attorney — Best for complex formations where you want a licensed attorney involved from the start, such as multi-member LLCs, series LLCs, or businesses in regulated industries.

For a side-by-side comparison of all your options, our best LLC formation services guide ranks and compares every major provider.

Texas LLC FAQs

How long does it take to form an LLC in Texas? Standard online filing through SOSDirect typically takes 3–5 business days. Expedited 24-hour processing is available for an extra $25. In-person filing at the Austin office can be processed same-day or next-day.

Do I need an attorney to start an LLC in Texas? No — and for a simple single-member LLC, an attorney isn’t necessary. However, for multi-member LLCs, businesses in regulated industries, or situations with complex ownership structures, legal counsel is money well spent.

Can a non-U.S. resident form a Texas LLC? Yes. Texas has no citizenship or residency requirements for LLC members or managers. Non-residents will need an ITIN (Individual Taxpayer Identification Number) or EIN for tax purposes. Note that foreign nationals may face additional U.S. federal tax reporting requirements.

What is a Texas Series LLC? Texas is one of a handful of states that allows “series” LLCs — a structure where a single LLC contains multiple sub-series, each with separate assets, liabilities, and members. It’s particularly popular in real estate investing. The legal protections between series are still developing in case law, so consult an attorney before relying on this structure.

Does my Texas LLC need to file an annual report? Texas does not have a traditional annual report requirement, but LLCs must file a Public Information Report (PIR) and, if applicable, a Franchise Tax report with the Texas Comptroller each year by May 15.

Final Thoughts

Texas genuinely earns its reputation as one of the best states in which to operate a business. The combination of no state income tax, a large and growing economy, and a streamlined formation process makes it an attractive home for LLCs of every size.

The process of learning how to start an LLC in Texas is straightforward once you break it into its component steps: choose a name, appoint a registered agent, file your Certificate of Formation, draft an operating agreement, get your EIN, and stay on top of your ongoing compliance obligations — particularly the BOI Report requirement that catches many new owners off guard.

If you’d like to compare your Texas options with other states — perhaps Delaware for its legal infrastructure or Wyoming for privacy — our best state to form an LLC guide is a useful next step.

The best formation service for your Texas LLC depends on your budget, complexity, and how much you want to handle yourself. But whether you file on your own or use a service like Northwest Registered Agent or ZenBusiness, the important thing is to actually get it done. An LLC you have is infinitely more valuable than a perfect one you’re still planning.

The author name used in this article may be a pen name or pseudonym and is used for illustrative and editorial purposes only. This article is for informational purposes only and does not constitute investment, tax, or legal advice. LLC laws, filing fees, and tax thresholds are subject to change; verify current requirements with the Texas Secretary of State and Texas Comptroller before filing. Consult qualified legal, tax, and financial professionals before making decisions about your business structure or formation strategy.