How to Open an LLC in Texas: A Step-by-Step Guide for Founders

Texas is one of the friendliest states for starting a business: no state income tax, no annual report for LLCs, and a formation process most founders finish in a single sitting. It comes down to one filing — the Certificate of Formation — plus a few follow-up steps that protect you later.

Fees below were checked against the Texas Secretary of State and Comptroller in November 2026 — confirm the current schedule before you file.

Step 1: Pick a name that clears the state check

Your LLC name must include "LLC" or "Limited Liability Company" and be distinguishable from every other registered business name in Texas. Check availability free on the Secretary of State's website — and read our guide to naming a startup before committing to a name that is hard to spell or crowded on Google. Name reservation costs $40 and holds for 120 days; most founders skip it.

Step 2: Choose a registered agent

Every Texas LLC needs a registered agent — a person or company with a physical Texas address who accepts legal mail for you during business hours. You can serve as your own agent with a Texas address; many founders hire a service ($100–$150/year) to keep a home address off the public record.

Step 3: File the Certificate of Formation — $300

This is the step that legally creates your LLC. File Form 205 with the Texas Secretary of State — online through the state's filing portal, by mail, or in person in Austin. The fee is $300 and non-refundable even if the filing is rejected, so double-check the name and agent details before you submit. Card payments add a small convenience fee (about 2.7%). Online filings are typically processed within a few business days; expedited service costs extra.

Step 4: Get an EIN from the IRS — free

An EIN is your business's tax ID. Apply free on the IRS website — about 15 minutes, issued immediately. You need it for a bank account, hiring, and taxes. Never pay for an EIN — the IRS issues them free.

Step 5: Write an operating agreement, open a bank account

Texas does not require you to file an operating agreement, but write one anyway — even for a single-member LLC. It records who owns what and what happens if a partner leaves; banks and courts take a documented LLC far more seriously. Then open a separate business bank account with your Certificate of Formation and EIN. Mixing business and personal money is the fastest way to lose the liability protection you just paid $300 for.

Step 6: Stay compliant — the May 15 deadline

Texas LLCs have no annual report, but every LLC must file a franchise tax report and a Public Information Report with the Texas Comptroller each year, due May 15. Most small service businesses owe no franchise tax: the no-tax-due threshold is $2,650,000 in revenue for the 2026 report year. You still must file when no tax is due — missing the deadline is the most common way new founders fall out of good standing.

What it costs in total

• Certificate of Formation: $300, one time.
• Name reservation: $40, optional.
• Registered agent: $0 self-served, $100–$150/year hired.
• EIN: free from the IRS.
• DBA (assumed name), if you trade under a different name: $25.

Once the legal shell exists, the real work starts: the brand. A clear name, a credible identity, and a website that looks like a real company turn an LLC into a business clients trust — see how branding differs for SaaS and D2C startups.

This article is general information, not legal or tax advice. For your specific situation, talk to a Texas business attorney or CPA.

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