Start Your LLC in Texas Today
LLC, which stands for limited liability company, is fast becoming one of the most popular business entity among new and small businesses for it’s less complex corporate structure. Unlike an S or C-corporation, LLC has a flexible structure. It also gives you that pass-through tax benefit, a limited liability and legal protection for your personal assets. With the advantage of looking more legitimate than the other guys, why you want to wait?
Start your LLC in Texas today.
Attributes of an LLC.
- owners are not liable for the company’s debts and losses. Only the company can be sued.
- There are no office titles like directors, shareholders, officers and so on. All owners have complete and equal authority on the company.
- There is no requirement to hold annual meetings or keep records of meeting’s minutes.
- All ownership is expressed in percentage ( e.g Chris owns 30% and Nina 70%).
Advantages of a Limited Liability Company
There are several advantages in starting LLC in Texas, but here are a few that stand out.
Liability protection: Under an LLC, only the company is liable for the debts and losses incurred in the course of doing business, not the owners which are only responsible for their personal investment in the company.
Pass-through taxation: It is not necessary to file a tax return to the company. Owners report their share of profits and losses on their personal tax returns, which means that double taxation is avoided.
Residency status: Owners do not have to be US citizens or permanent residents.
Legal protection: Owners are less responsible for the business debts and commitments.
More credibility: Partners, suppliers, and lenders favors your business more when you formed an LLC.
Disadvantages of a Limited Liability Company
Drafting LLC is an interesting option, but there are challenges.
Limited growth potential: You can not issue shares to attract investors.
Inconsistency: LLC can be treated differently in different states.
Self-employment tax: Income may be subject to this taxes.
Recognition of tax on appreciated assets: This can happen if you are converting an existing company to an LLC. Another way to accumulate additional taxes.
Is an LLC right for my business?
It really depends on what your short and long-term business goals are. We recommend that you to seek an advice from Accountants from Green Tree Tax and think carefully about where the company is now and how you want your business to grow before deciding whether the LLC structure is right for you.
How to form an LLC in Houston Texas (Limited Liability Company):
STEP 1: Name your LLC
This is the first and most important step in starting your LLC. Do some research to ensure that the name you choose fits your business and is easily searchable for potential customers.
Follow the naming guidelines: The business name must contain the words Limited Liability Company or LLC/L.L.C. as an abbreviation.
Restricted words require additional documents (eg, Banc, bank, banking, etc.) and/or licensed personals (eg, doctor, engineer, etc.). to be part of the LLC. Restricted words are those who confuse the name of your LLC with a federal agency or state, for example, FBI, Secret Service, Treasury, etc.
Is the name available in Texas? Make sure the name is still available by registering for a free account with the Secretary of State of Texas and conducting a name search. Registering an account on the Texas SOS website will also provide you the access to file any form of business online and make payments to the state.
Check if the URL is available: Check the name of your LLC is available so you can reserve your domain name. Even if you do not plan to make a website today, you can buy the domain name in order to keep others from acquiring it.
STEP 2: Select a registered agent
It is necessary to appoint a registered agent for a Texas LLC
What is a Registered Agent? A registered agent is a person or company designated by your company to receive and send documents officially on your behalf.
Who can be an authorized agent? The registered agent must be a Texas resident or authorized to do business in Texas society. You can choose an individual within the company, including yourself.
STEP 3: Present the certification of the formation.
You need to file the certification of formation for a domestic LLC. There is a nonrefundable fee of $300 payable to the secretary of state when submitting this form.
STEP 4: Create an operating agreement
What is an operating contract? An operating agreement is a legal document that describes the properties and operating procedures of your LLC. This agreement allows the formation of financial relations / work with the co-owners in an established system for your business. An operating agreement to form an LLC in Texas is not necessary but is a good practice to have one.
STEP 5: Get an EIN
What is an EIN? The Employer Identification Number (EIN) or federal tax number identification is used to identify a business entity. It is essentially a social security number for the company.
Why do I need an EIN? an EIN is required for the following:
- Open an account in investment banking for the company.
- For the purposes of federal and state taxation.
- To hire employees for the company.
Call 713-384-9432 to start your LLC in Texas
GET YOUR LLC TODAY