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| Everything you need to file your own Texas LLC in 2026 — no formation company required. |
How to Form an LLC in Texas (2026): Step-by-Step Guide + Full Cost Breakdown
Forming a Texas LLC comes down to one state filing, one state fee, and a handful of decisions you need to get right the first time so you're not paying to fix them later. This guide walks through the entire process the way the Texas Secretary of State actually processes it — not the marketed version formation companies use to upsell add-ons.
Quick answer: A Texas LLC is formed by filing a Certificate of Formation (Form 205) with the Texas Secretary of State and paying a $300 filing fee. Approval typically takes about 2 business days online. You'll also need a registered agent, an EIN from the IRS, and — depending on revenue — an annual Public Information Report filed with the Texas Comptroller.
Table of Contents
- Why Choose an LLC in Texas
- How Much Does It Cost to Form an LLC in Texas?
- Before You File: 3 Decisions to Lock In First
- Step-by-Step: Filing Your Texas Certificate of Formation
- After You're Approved: What Comes Next
- Texas Franchise Tax and the Public Information Report
- Texas Series LLC: An Option Most States Don't Offer
- DIY Filing vs. Using a Formation Service
- Common Mistakes That Get Texas LLC Filings Rejected
- Real-World Scenarios: Which Path Fits You?
- Frequently Asked Questions
Why Choose an LLC in Texas
Texas has no state personal income tax, which is part of why it's consistently ranked among the top states for new business formation. An LLC (Limited Liability Company) gives you:
- Personal liability protection — your house, car, and personal savings are generally shielded from business debts and lawsuits, unlike a sole proprietorship.
- Pass-through taxation — by default, profits pass through to your personal tax return; the LLC itself doesn't pay federal income tax (Texas franchise tax is separate and covered below).
- Credibility — vendors, banks, and clients generally treat "LLC" as a more established structure than an unregistered sole proprietorship.
- Flexible management — member-managed or manager-managed, with ownership and profit splits you define yourself in your operating agreement rather than fixed by statute.
| Structure | Personal Liability Protection | State Filing Required | Ongoing State Filings | Typical Cost to Start |
|---|---|---|---|---|
| Sole Proprietorship | No | No (DBA optional) | None | $0–$25 (DBA only) |
| General Partnership | No | No (DBA optional) | None | $0–$25 (DBA only) |
| Texas LLC | Yes | Yes — Certificate of Formation | Public Information Report (annual) | $300 |
| Texas Corporation | Yes | Yes — Certificate of Formation | Public Information Report + franchise tax reporting | $300 |
How Much Does It Cost to Form an LLC in Texas?
The Texas LLC filing fee is a flat $300, paid one time to the Texas Secretary of State when you file your Certificate of Formation (Form 205). This is the only fee required by the state to legally create your LLC — everything else on the list below is optional or situational.
| Item | Cost | Required? |
|---|---|---|
| Certificate of Formation (Form 205) filing fee | $300 | Required |
| Online payment convenience fee (SOSDirect, ~2.7%) | ~$8 | Only if paying by card online |
| Expedited processing | +$25 | Optional |
| Name reservation (Form 501, valid 120 days) | $40 | Optional |
| Assumed name / DBA certificate | $25 | Only if operating under a different name |
| Certificate of Status / good standing | $15 | Optional (often needed for banking or expansion) |
| Registered agent service (if not self-serving) | $0–$300/year | Optional |
| EIN (Employer Identification Number) | $0 | Free directly from the IRS |
| Operating agreement | $0 (DIY) – $200+ (attorney-drafted) | Not filed with the state, but strongly recommended |
| Business licenses/permits | $0–$500+ (industry/city dependent) | Situational |
| Franchise tax | $0 for most small LLCs (see threshold below) | Filing required annually regardless of amount owed |
For most single-member LLCs filing themselves, total realistic first-year cost is $300–$365 — the state fee plus a name reservation and/or DBA if needed. There is no ongoing state renewal fee for the LLC itself in Texas.
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| An LLC separates your personal assets from business debts — a sole proprietorship does not |
Before You File: 3 Decisions to Lock In First
1. Your LLC Name
Texas requires your LLC name to:
- Contain "Limited Liability Company," "LLC," or "L.L.C."
- Be distinguishable from every other active entity name already on file with the Texas Secretary of State — not just similar, legally distinguishable
- Avoid restricted words (e.g., "Bank," "Trust," "University") without additional approval from the relevant state agency
Search the name yourself using the SOSDirect business name search before you file anything. If you're not ready to file immediately but want to lock in a name, Form 501 reserves it for 120 days for $40.
2. Registered Agent
Every Texas LLC must continuously maintain a registered agent — a person or company with a physical Texas street address (no P.O. boxes) who is available during business hours to accept legal documents and state correspondence on the LLC's behalf.
- Serve as your own registered agent — free, but your name and address become part of the public record, and you must be reliably available at that address.
- Hire a registered agent service — typically $100–$300/year, keeps your personal address off the public record and covers you if you travel or move.
3. Management Structure
Decide whether your LLC will be member-managed (owners run daily operations) or manager-managed (owners appoint a manager, who may or may not be an owner). This gets recorded on your Certificate of Formation and should match what you put in your operating agreement.
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| The five-field walkthrough of Form 205, in the order the Secretary of State reviews them. |
Step-by-Step: Filing Your Texas Certificate of Formation
Step 1: Confirm Your Entity Name and Registered Agent
Have your checked, distinguishable name and your registered agent's name/Texas street address ready before you open the filing form.
Step 2: Complete Form 205 (Certificate of Formation — Limited Liability Company)
Form 205 asks for:
- Entity name
- Registered agent name and Texas address
- Governing authority (member-managed or manager-managed) and the names/addresses of initial members or managers
- Purpose (a general statement is sufficient for most LLCs)
- Effective date (immediate upon filing, or a specified future date up to 90 days out)
- Organizer's name, address, and signature
Step 3: File Online (SOSDirect/SOSUpload) or by Mail
| Method | Typical Processing Time | Payment |
|---|---|---|
| SOSDirect (online) | ~2 business days (up to 3–4 during high-volume periods) | Credit card (+ ~2.7% convenience fee) |
| SOSUpload (online document upload) | Similar to SOSDirect | Credit card |
| Roughly 7–10 business days processing, plus mail transit time both ways | Check, money order, or credit card form | |
| In person / walk-in | Same-day in many cases | Cash, check, or card |
File directly with the state through the Texas Secretary of State's official forms page.
Step 4: Get Your Approval
Once approved, the Secretary of State returns a file-stamped copy of your Certificate of Formation. This is your LLC's official proof of existence — you'll need it to open a business bank account and, in most cases, to apply for an EIN.
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| For the 2026 report year, LLCs under $2.65M in annualized revenue owe $0 franchise tax — but still must file. |
After You're Approved: What Comes Next
Get Your EIN (Free, Direct from the IRS)
An Employer Identification Number is required to open a business bank account, hire employees, and file federal taxes. Apply directly and free through the IRS EIN application — never pay a third party for this step.
Draft Your Operating Agreement
Texas does not require you to file an operating agreement with the state, but it's the single most important internal document your LLC will have. It should cover:
- Ownership percentages and capital contributions
- Profit and loss distribution
- Voting rights and decision-making authority
- What happens if a member wants to leave, dies, or wants to sell their stake
- Dissolution procedures
Without one, Texas's default LLC statute rules apply — which may not reflect what you and your co-owners actually agreed to.
Open a Business Bank Account
Bring your file-stamped Certificate of Formation and EIN confirmation letter. Keeping business and personal funds separate is one of the factors courts look at when deciding whether your liability protection actually holds up (a concept known as "piercing the corporate veil").
Check Licenses and Permits
Texas does not have a general statewide business operating license, but many professions and local jurisdictions require specific licenses or permits — restaurants, contractors, cosmetology, childcare, and sales-tax-collecting businesses among them. Check with your city/county clerk and the relevant state licensing board for your industry.
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| Every Texas LLC must maintain a registered agent with a physical street address — P.O. boxes don't qualify |
Texas Franchise Tax and the Public Information Report
This is the step most new Texas LLC owners get wrong: they see "no tax due" and assume there's nothing to file. That's incorrect.
For the 2026 report year, the Texas Comptroller's no-tax-due threshold is $2,650,000 in annualized total revenue (up from $2,470,000 in 2024–2025). If your LLC's revenue falls at or below that amount, you owe $0 in franchise tax — but you are still required to file a Public Information Report (Form 05-102) with the Comptroller by May 15 every year. Skipping it triggers a $50 penalty and can eventually lead to forfeiture of your LLC's right to do business in Texas.
| Annualized Total Revenue | Franchise Tax Owed | Filing Required |
|---|---|---|
| $2,650,000 or less (2026 threshold) | $0 | Public Information Report (Form 05-102) |
| Above $2,650,000, up to $20 million | 0.375% (retail/wholesale) or 0.75% (most other entities) of taxable margin | EZ Computation Report (Form 05-169) |
| Above $20 million | Calculated per margin method | Long Form (05-158-A/B) |
See the Texas Comptroller's franchise tax page for current thresholds and forms — this figure is adjusted periodically, so confirm it hasn't changed before you file.
Texas Series LLC: An Option Most States Don't Offer
Texas is one of a relatively small number of states that allows a Series LLC — a single "master" LLC that can create multiple internal "series," each with its own assets, liabilities, and members, legally shielded from each other under one parent filing. Real estate investors holding multiple rental properties are the most common users of this structure, since each property can sit in its own series without needing a separate $300 filing and separate registered agent for every property.
- A Series LLC still files one Certificate of Formation (with a provision authorizing series) and pays the standard $300 fee.
- Each series should keep separate records and bank accounts to preserve the liability separation between series.
- Not all states recognize Texas series LLCs the same way, which matters if you plan to hold property or do business outside Texas — check with a business attorney before relying on this structure across state lines.
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| Your EIN is free directly from the IRS — never pay a third party for this step. |
DIY Filing vs. Using a Formation Service
| DIY (File Yourself) | Formation Service | |
|---|---|---|
| State fee | $300 | $300 (passed through) + service fee |
| Typical total cost | $300–$365 | $300–$600+ depending on package |
| Speed | Same as state processing time | Same or slightly slower (service files on your behalf) |
| Best for | Single-member LLCs, straightforward structures, comfortable reading a government form | Multi-member LLCs with complex ownership splits, or owners who want registered agent + compliance reminders bundled |
| Risk of rejection | Higher if the name isn't pre-checked or a required field is skipped | Lower — most services pre-check name availability |
Common Mistakes That Get Texas LLC Filings Rejected
- Name not distinguishable — the SOS rejects filings where the name is too similar to an existing entity, even with minor punctuation or spacing differences.
- Registered agent address is a P.O. box — Texas requires a physical street address.
- Missing organizer signature — a surprisingly common rejection reason on paper filings.
- Submitting only one copy by mail — mail filings need a duplicate copy if you want a file-stamped copy returned to you.
- Assuming "no tax due" means "no filing due" — as covered above, the Public Information Report is still mandatory even at $0 owed.
Real-World Scenarios: Which Path Fits You?
Scenario 1: Freelancer Formalizing a Side Business
A freelance graphic designer in Austin earning $60,000/year wants liability protection before taking on larger corporate clients. She serves as her own registered agent, files Form 205 online for $300, gets a free EIN, and drafts a simple single-member operating agreement. Total cost: $300. Her revenue is far under the $2.65M threshold, so she'll owe $0 franchise tax but still files her Public Information Report every May.
Scenario 2: Two Co-Founders Starting a Multi-Member LLC
Two partners starting a marketing agency need to define ownership splits (60/40) and what happens if one leaves. They file Form 205 themselves ($300), then invest in an attorney-drafted operating agreement (~$300–$600) given the more complex ownership terms — a cost worth paying up front to avoid a dispute later.
Scenario 3: Real Estate Investor With Multiple Rental Properties
An investor with four rental properties considers a Texas Series LLC instead of four separate LLCs, filing one Certificate of Formation with series provisions and keeping separate books per series — reducing formation costs from $1,200 (four separate LLCs) to $300, plus the cost of proper series recordkeeping.
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| Texas doesn't require you to file an operating agreement — but you need one anyway. |
Frequently Asked Questions
How much does it cost to form an LLC in Texas?
The Texas Secretary of State charges a one-time $300 filing fee for the Certificate of Formation (Form 205). Optional add-ons include a $40 name reservation, a $25 assumed name filing, and $0–$300/year for a registered agent service.
How long does it take to form an LLC in Texas?
Online filings through SOSDirect typically process in about 2 business days (up to 3–4 during high-volume periods). Mailed filings generally take 7–10 business days processing, plus transit time both ways.
Do I need a registered agent for a Texas LLC?
Yes, continuously, for as long as the LLC exists. It must be a Texas street address — not a P.O. box.
Does Texas require newspaper publication to form an LLC?
No. Texas has no publication requirement, unlike states such as New York or Arizona.
Does my Texas LLC owe franchise tax?
Most small LLCs owe $0 because their revenue is under the 2026 no-tax-due threshold of $2,650,000 in annualized total revenue. Every LLC must still file a Public Information Report by May 15 each year, regardless of tax owed.
Can I be my own registered agent in Texas?
Yes, as long as you have a physical Texas street address and are reasonably available during business hours to accept documents.
What's the difference between member-managed and manager-managed?
Member-managed means the owners run daily operations directly. Manager-managed means the owners appoint one or more managers (who may or may not be owners) to run the business, similar to how a corporation's officers operate separately from its shareholders.
Do I need an attorney to form an LLC in Texas?
Not legally — the Certificate of Formation is designed to be filed without one. An attorney becomes more valuable for multi-member ownership agreements, industry-specific licensing questions, or complex asset-protection planning like series LLCs used across multiple states.
What is a Texas Series LLC?
A single LLC filing that allows you to create multiple internal "series," each with separately shielded assets and liabilities, commonly used by real estate investors holding multiple properties under one parent entity.
What happens if I miss the Public Information Report deadline?
You'll face a $50 penalty even if you owe $0 in tax, and continued non-compliance can lead to forfeiture of your LLC's right to transact business in Texas.
Related Guides on G-LegalHub
- How to Register a Business Step by Step (2026 Guide)
- How to Start an LLC or Small Business With a Criminal Record
- [SUGGESTED NEW CLUSTER PAGE] LLC Operating Agreement Template + Generator
- [SUGGESTED NEW CLUSTER PAGE] How to Get an EIN for Your Business (Free, Step-by-Step)
- [SUGGESTED NEW CLUSTER PAGE] Texas Franchise Tax and Public Information Report: Complete Guide
- [SUGGESTED NEW CLUSTER PAGE] Texas Series LLC Explained: Setup, Costs, and When It Makes Sense
- [SUGGESTED NEW CLUSTER PAGE] LLC Formation Costs by State (50-State Comparison)
This article is for general informational purposes only and is not legal, tax, or financial advice. Filing fees, thresholds, and processing times change — confirm current figures with the Texas Secretary of State and Texas Comptroller before filing.
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