How to Start an LLC in Texas

Learn how to start an LLC in Texas with the $300 filing fee, Certificate of Formation, and franchise tax basics. A complete step-by-step guide for 2026.

Why form an LLC in Texas?

If you want to know how to start an LLC in Texas, the process is straightforward and affordable. The state charges a flat $300 filing fee, and most owners finish the paperwork in a single afternoon. Texas is one of the most business-friendly states in the country. There is no state income tax for individuals, and the LLC structure keeps your personal assets separate from business debts. You also get flexible management, meaning you can run the company yourself or share control with partners. For a quick reference on fees and requirements, see our Texas state page.

Step 1: Check name availability on SOSDirect

Your LLC name must be distinguishable from every other business registered in Texas. The quickest way to check is SOSDirect, the Secretary of State's online portal. Search for your preferred name, then reserve it if you are not ready to file. A name reservation costs $40 and holds the name for 30 days. Keep the name short, easy to spell, and include an entity designator such as LLC or Limited Liability Company. Avoid words that suggest a regulated business, like bank or insurance, unless you hold the right licenses.

Step 2: Choose a registered agent

Every Texas LLC must have a registered agent with a physical street address in the state. The agent accepts legal documents, tax notices, and service of process on your behalf. You can name yourself, a trusted friend, or a professional registered agent service. A professional service keeps your home address off public records and makes sure you never miss a deadline. See our registered agent guide for help choosing one.

Step 3: File the Certificate of Formation

The Certificate of Formation is the official document that creates your LLC. In Texas it is also known as Form 205. You file it with the Secretary of State, and the filing fee is $300. You can file online through SOSDirect or by mail. The form asks for your LLC name, registered agent, management structure, and the name and address of at least one organizer. Most online filings are processed within a few business days. You do not need to list a purpose beyond forming a limited liability company.

Step 4: Get an EIN and open a business bank account

Once your Certificate of Formation is approved, apply for an Employer Identification Number from the IRS. The EIN is free and takes about 10 minutes online. You need it to open a business bank account, file taxes, and hire employees. See our EIN guide for the full walkthrough. With the EIN in hand, open a separate business checking account so your personal and business money never mix. Clean separation between accounts makes bookkeeping easier and strengthens your liability protection.

Step 5: Write an operating agreement

Texas does not require an operating agreement, but you should write one anyway. The document records who owns the company, how profits are split, and how decisions get made. It also names what happens if a member leaves or passes away. For a single-member LLC, a simple one-page agreement is usually enough. For multi-member LLCs, the agreement prevents disputes that can sink the business.

Texas franchise tax and annual requirements

Texas does not require an annual report for LLCs. Instead, the state uses the franchise tax. Most small LLCs owe no franchise tax at all because the state exempts businesses with total revenue below a certain threshold. If your revenue stays under that line, you still file a no-tax-due report each year. If you cross the threshold, you owe a small percentage of your margin. Keep good records so the annual filing is painless.

Costs and timeline at a glance

Here is the bottom line for a Texas LLC as of 2026. The Certificate of Formation costs $300. A name reservation, if you use one, costs $40. A registered agent service typically runs $50 to $150 per year. Expect the state to process your filing in a few business days online, or one to two weeks by mail. Total startup cost is usually under $500.

Frequently Asked Questions

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

The Certificate of Formation filing fee is $300. Add $40 if you reserve a name first, and budget $50 to $150 per year for a registered agent if you use a service. Most owners start a Texas LLC for under $500 total.

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

Online filings through SOSDirect are usually processed within a few business days. Mail filings take one to two weeks. Expedited processing is available for an extra fee if you are in a hurry.

Does Texas require an annual report for LLCs?

No. Texas does not have an annual report for LLCs. Instead, you file a franchise tax report each year, and most small LLCs owe nothing because their revenue stays below the exemption threshold.

Do I need a registered agent in Texas?

Yes. Every Texas LLC must maintain a registered agent with a physical street address in the state. You can serve as your own agent or hire a professional service.

Is an operating agreement required in Texas?

Texas does not require an operating agreement, but it is strongly recommended. It documents ownership, management, and profit sharing, which prevents disputes later.