Texas LLC – Formation Documents

Texas LLC – Formation Documents

The following information is provided for
educational purposes only and in no way constitutes legal, tax, or financial advice. For legal, tax, or financial advice specific
to your business needs, we encourage you to consult with a licensed attorney and/or CPA
in your state. The following information is copyright protected. No part of this lesson may be redistributed,
copied, modified or adapted without prior written consent of the author. A Limited Liability Company is a hybrid between
a corporation and a partnership. An LLC protect your assets in the event of
a lawsuit. In order to form your LLC, you must file LLC
Formation Documents with the Secretary of State. Once your documents are approved and sent
back to you, your LLC is now in existence and authorized to do business in the State. We have spent considerable time to make the
details of this video simple and easy to understand. However, we cover a lot of ground and you
are going to hear a lot of new terminology. We do recommend that after you watch this
video, you watch it a 2nd time in order to fully comprehend all the information provided. Please make sure you have watched the 1st
lesson on researching your LLC’s name. Your desired LLC name must be available for
use before you proceed with filing your LLC Formation Documents. Your LLC is required to list a Registered
Office and a Registered Agent within your LLC Formation Documents. The Registered Office is a physical address
(it cannot be a PO Box that is located in the State where your LLC is formed). A Registered Agent is a person or a company
who agrees to accept legal mail and important documents on behalf of your LLC. The Registered Agent is located at the Registered
Office and is generally accessible during normal business hours. As we mentioned, a Registered Agent can be
a person or a company who has an address in the state where your LLC is formed. You, as an individual, can be your LLC’s Registered
Agent. However, your LLC cannot be its own Registered
Agent. For individuals who have an address in the
State, it is most common that they serve as the LLC’s Registered Agent. Having said that, the individual person you
choose as a Registered Agent does not need to be a member of the LLC. It can be a friend, a family member, or, frankly,
anyone you know who agrees to accept Service of Process on behalf of your LLC. Service of Process. “Service of Process” is the delivery of legal
mail and important documents sent from the State or law firm to your LLC. Correspondence from the State can include
items such as Annual Report notices, late notices, and copies of Formation Documents. Legal documents can include items such as
subpoenas and/or complaints for legal action. Again, the purpose of designating a Registered
Agent is to authorize someone to accept Service of Process on behalf of your LLC. Consent to serve as Registered Agent. Whoever agrees to be a Registered Agent must
sign a consent form called “Consent to Serve as Registered Agent”. You can find this form in the “Downloads”
Section below this video. The “Consent to Serve as Registered Agent”
form does not need to be mailed in with your LLC Formation Documents. In fact you don’t need to mail this document
anywhere. The “Consent to Serve as Registered Agent”
form is an “internal document”, meaning that you will just keep it with your business records. Takeaways: the purpose of a Registered Agent
and its Registered office is to be a point of contact for the State and to accept Service
of Process for your LLC. You or (someone you know) can be your LLC’s
Registered Agent, so long as they have a physical address located in the State. If you don’t have an address in the State
that you can use, you can hire a Commercial Registered Agent. Commercial Registered Agents. A Commercial Registered Agent is a company
that specializes in receiving service of process on behalf of businesses nationwide. They typically charge between $100-250 per
year. If you need a Commercial Registered Agent,
we have a few recommendations that can be found below this video with their names, phone
numbers, and links to their websites. Now, let’s discuss your LLC Formation Documents. The name of the LLC Formation Document for
the State of Texas is called the Certificate of Formation. This document is not complicated and contains
basic information, including listing your Registered office and Registered Agent. It will also require you to list your LLC’s
name, and the name and address of the LLC member or members. No need to stress,out, we will walk you through
the details of the Certificate of Formation in just a couple minutes and we’ll make sure
that you get it filled out correctly. If you need a Commercial Registered Agent,
you will first need to hire them, and then obtain their address before finalizing and
mailing your Certificate of Formation. Submitting your Certificate of Formation. You will find a filing fee amount, accepted
forms of payment, and the address where to send your Certificate of Formation to below
this video. You will need to mail 2 copies of your Certificate
of Formation, along with your filing fee to the State. There are no additional cost or filing fees
to form your LLC. Once you mail the filing fee along with 2
completed copies of the Certificate of Formation, you can expect 2 things: first, within 5-7
business days, the State will send you back a copy of the Certificate of Formation with
a stamp of approval. Your LLC is now a legally formed business
in the State of Texas. Until you have confirmation your LLC has been
officially approved, do not order your EIN (your Federal Tax ID Number or start to use
your LLC for any business purposes. Second, in approximately 2 months, you will
get a letter from the Texas State Comptroller (the division responsible for tax-related
items). This letter will instruct you on filing your
Annual Franchise Tax Report, which all LLCs in Texas are required to file. Annual Reporting and Taxes. Regarding the Annual Reporting requirements,
your LLC is required to file 2 documents on a yearly basis. The first is the Franchise Tax Report which
is filed with the Texas State Comptroller, not the Corporation Section. The Corporation Section is the office in which
you mail your LLC Formation Documents. Remember, the Texas State Comptroller is a
division that handles tax related-items. The second is a Public Information Report
(or PIR) that must also be submitted with your Franchise Tax Report. These reports are not easy to complete yourself. They are tax documents, and we recommend you
get help from your accountant or tax professional because you will need to decipher gross receipts,
dividends, interest, losses gains, and other financial details. Even if your LLC does not generate revenue
or have business activity within a given tax year, you will still be required to file this
annual paperwork with the State. We highly recommend that you hire a tax professional
when dealing with taxes for your LLC. In fact, it’s a good idea to start looking
for a tax professional once your LLC is formed. So you can find someone who you are comfortable
with and will help you grow your business. We are now ready to fill out the Certificate
of Formation. You can download this document below this
video. Let’s get started. Here we are inside the Certificate of Formation. This is a 6-page PDF document. Pages 1-3 have commentary and instructions
and details. Feel free to read through if you’d like, but
we have covered all this information in this video. I’m going to go down to page 4. I’m going to begin filling out the Certificate
of Formation. Do note that I have a professional version
of Adobe Acrobat. You may have just a simple version of Adobe
Reader, and you may not be able to have as much functionality to edit and manipulate
the document on the computer. If you can, feel free to fill this document
out on the computer, or you can print it out and then fill it out by hand. If you do fill it out by hand, make sure that
you use a blue or black ink. Another thing to make an important note of
is the top. you’ll see that it says “Submit in duplicate
to Secretary of State” with the address and the filing fee. What they mean by “Submit in duplicate” is
that, basically, you need to fill this document out twice, so you can either fill the entire
document out, make a copy of it in a copy machine, and then mail that along with the
filing fee, or, if you don’t have a copy machine, you’re just going to basically print this
document out and fill it out twice. Also, below our video, we have the mailing
address for the Texas Secretary of State and the filing fee. Right now, the time of this recording, this
P.O Box that you see in the video is the address. However, you might be watching this video
in the future so please go ahead and look below this video and make sure that the address
or, rather, look below this video and use the address that we mentioned there as that’s
the most up-to-date mailing address. All right, let’s get started. Under Article 1, I’m going to go ahead and
list my LLC’s name. Remember to include the designator “LLC” or
“L.L.C”. Also, in this example, I’ve used a comma. The comma is not required so it’s a personal
preference. You can use one if you’d like, or you can
leave it out if you prefer. Let’s go down to Article 2 where we’re going
to list our Registered Agent and the Registered Office. You’re first going to select “A” or “B”, and
then put an address in Section C. You’re going to select Section A if you used a Commercial
Registered Agent. If you, or someone you know is going to be
the Registered Agent, you’re going to list their name in Section B. Then you list their
address in Section C. I’m just going to go through both examples real quick. So let’s say that you or someone you know
is going to be the Registered Agent for the LLC. I’m going to go ahead and check off or put
an X in the box next to “B”, and I’m going to go ahead and list myself. I’m going to be the Registered Agent for this
LLC in this example. “John Doe”, and then I’m going to go ahead
and fill my address in Section C. This is what Article 2 will look like if you
or someone you know is going to be Registered Agent: you’re going to have checked off “B”,
list their name, and then their mailing address. Let’s see what this Section would look like
if you used a Commercial Registered Agent. Let’s say that I’ve hired Northwest Registered
Agent as a Registered Agent for my LLC. I’m going to go ahead and check off “A”, and
I’m going to list their name on this field here. And now I’m going to list their address in
Section C. Don’t worry that they don’t actually have a street address. Because they’re an authorized Registered Agent
with the State, this is their actual street address. Now, 1 thing: you’re not going to have Section
A and Section B checked off together. Again, it’s “A” if you’re using a Commercial
Registered Agent, or “B” if you or someone you know is going to the Registered Agent
for the LLC, and in Section C, you list the address. Let’s go down to Article 3 (“Governing Authority”). In this Section. you’re going to check off Box B to denote
that your LLC will be run by its own members. You can see here “the limited liability company
will not have managers”. These are external people that run your company
and instead, the company will be governed by its members and their names and addresses
are below. You basically have 3 boxes in Article 3 for
the names and addresses of the LLC’s members. If you’re a Single-Member LLC (which in this
example I am), you’re just going to list your name and address in this box. If you have multiple members, again you’re
going to list their names and their addresses in “Governing Person 2” and the box for “Governing
Person 3”. I’m going to go ahead and fill out “Governing
Person 1” right now. All right, I now have Article 3 complete. Again, remember, if you’re a single member,
just going to have someone in “Governing Person 1”, or if you’re Multi-member, you’re going
to list out all those members in the boxes. All right, Article 4 “Purpose”. “The purpose for which this company is formed
is for the transaction of any and all lawful purposes for which a limited liability company
may be organized under the Texas Business Organizations Code”. And in this case, because you have no supplemental
provisions or information, Article 4 you can just leave blank. All right, let’s go down to the next section
of this document. We’re now on the final page of the PDF, and
at the top I’m going to list the Organizer (which is myself), the person forming the
LLC, and I’m going to include my name and address. This will most likely be your own personal
information. Once that is complete, I’m going to go down
to the “Effectiveness of Filing”. You’re going to check off Box A (this document
becomes effective when filed with the secretary of state). Now, I’m going to scroll down to the Execution
Section. This section is quite simple. You’re basically going to list the date on
the left, you’re going to sign on the 1st line, and then write your name on the line
below. Regarding the date, you can type the date
out, or write the date out, you know, such as February 15th, and then the year, or you
can write “2/15/the year”. Either 1 is acceptable. Now, if you’re forming your LLC in December
and you don’t actually need to be doing business this month, it’s best to go ahead and date
the document in January of the following year, because if you form your LLC and it’s approved
in December, you actually have to file a tax return for that year and it’s a little bit
more of a headache in terms of paperwork so, if you can wait a couple more weeks, we recommend
going ahead and filing in January if it’s December the time you’re watching this video. Also a lot of people do ask about the date
(if it needs to be the exact date that they drop the documents in the mail). It doesn’t need to be the exact date, but
you cannot back-date or forward-date this document (I would say more than a couple days). 1 other thing to make note of here, is that
this document does not need to be notarized. Again, you’ll simply fill it out on the computer,
and print it out (or print it out and fill it out by hand), and then simply send this
along with your filing fee to the State. And that wraps up the Certificate of Formation. Again, down in “Execution” you date, sign,
and list your name. Remember to include 2 copies of the Certificate
of Formation and your filing fee, and make sure check the address and the filing fee
amount below this video, send those 2 documents and your filing fee to the State, and within
5-7 business days you’re going to receive back these documents with a stamp of approval. And that concludes this lesson.

55 thoughts on “Texas LLC – Formation Documents

  1. Thank you for the video, its very helpful!! just a quick question, what address can i use for the governing person address, (I don't have a texas address yet), can I use the registered agent's(My friend's) address? and will this address be public?

  2. I noticed you said not to make your EIN until after this is done.. problem is, I made my EIN number before knowing about any of this. What happens now? As in how does it affect anything?

  3. Matt,
    I'm a Disabled Veteran, I want to file as a single member (100% Veteran Owned) and the requirement is that to be a "veteran owned" company it has to be 100% owned by veterans. I have an investor who is a non-veteran and the idea is for him to receive a portion of the profits without ownership. Should I list him as a manger instead of a member on my Certificate of Formation LLC Form (Form 205)? Will this affect me at all as far as the requirement is concerned? I haven't found anything that relates to this scenario…Thanks!

  4. This was super helpful! So if I create and LLC in the month of June, can I include all business expenses/losses for the entire year for tax purposes? Or will the business items take effect only AFTER approval is received from the state?

  5. Awesome video, I have a question, I filed for my LLC before I saw your video and on my certificate of formation on manager 2 I put the name of my business. Will I need to redo my LLC?

  6. Thank you ! It helped me a lot . Now my questions are ,
    1, do I need northwest registered agency to sign a consent to be my registered agent ? I paid them to file for me and they did . I have received the document back from SOS. Northwest didn’t give me a signed consent . So I have to ask for it ?

    2) do I need to pay 30$ to request a certificate of articles ( like Florida state , I have watched you talking about requesting a certificate with 30$, why Texas don’t need to ?) thank you very much

  7. That is an awesome video.  You may want to add about veterans as I stumble about the waived fee in the comments.  Also, what happens if my name is already taken.  Do we play mail tag until I find one that is not taken…can I search first before mailing?  Thank you so much!  Julian

  8. Hey folks, make sure to check the site for most up-to-date information: https://www.llcuniversity.com/texas-llc/forms/. Or select your state and start forming your LLC with our free guides: https://www.llcuniversity.com/

  9. hi, there. for article 4, I did not specify what the purpose of my business is, just like in your video. Will this be a problem getting approved?

  10. Hello i did not watch this video before filing the LLC, however i did not receive the Copy of certificate of formation with approval stamp and i received the Document number, acknowledgment letter and certificate of filing with filling date and effective date. are these two document valid as the LLC exists within state of Tx?

  11. Great info. I was wondering if you have any information on reinstating a Texas LLC. I think I have the gist of it but feel like I;m missing something. Any ideas would be appreciated….thanks.

  12. Great video! Thank you for creating this. First time planning to form an LLC and videos like these make it so much more easy to digest.

  13. In Article 3 with "B" checked – What if I have 4 "Governing Person"s? Can I print an additional page 5 to send in with the 4th person listed there?

  14. I have a question, For the 'Governing person' & 'Organizer section', it will be me. Do I have to list my personal mailing address on those fields?. Can I use the mailing address i have set up for this new llc for those fields? Or is it mandatory for it to be my home address.

  15. Quick question that I tried to post on your site. Do you have to file an application for name reservation? I've verified the name I want to use is available.


    The information is clear, well paced, and very easy to follow. You have saved me time and money!

  17. Thank you for making this video, it's very well explained.
    Where is it that you select how the LLC is going to be taxed? If either as a pass through, or as s-corp
    Thank you

  18. So I am going to be the registered agent, can I use my home address for article 2? Cause I haven't found my business location yet.

  19. Is the certificate of Formation provided in this link updated? (It says revised 05/11)
    Thank you for this great video series!

  20. Can you instruct on how to add someone on care as a board of Director and a officer? This is different than a manager right?

  21. Great work! In state of TX – can the LLC certificate of formation be done online on the Secretary of State Website?

  22. Video was very helpful. Do you have a website I can search and see if my business name is available? Thank you

  23. Hello there, I just explored the LLC website but couldn't find a way to get in touch with you, I have a couple of questions, please get back at me at your earliest convenience. Thanks

  24. Thanks for the video! I filed mine online through SOS Direct but was able to use this information and apply it to the online process. Save me some headaches for sure! 😀

  25. Hi, I filled out the formation documents and sent out the documents last Thursday dose it take more than 5-7 business days to get the formation documents back from the Secretary of State with the Certificate of Formation stamp of approval?

  26. If I am the registered agent for my LLC, do I also put my name down as a governing authority? Or would I just put my partners name there as a member?

  27. How do I remove my spouse and son from member on the governing persons? The bank needs them to be present at the bank to be able to open a bank account and unfortunately my son is barely 4 yrs old and wife isn’t around either.

  28. What if you don’t have a business address? The business in question is a vending machine business, would I put my apartment? I send my mail to the ups store out of convenience

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