How to Form an LLC in Texas: Form 205 Step-by-Step Guide

For small business owners in Texas, the LLC is the most popular and easiest type of legal entity to form for operating their business. But unfortunately, that doesn’t mean forming an LLC in Texas is exactly simple. Therefore, I have created a 5-step process to guide new business owners through the LLC formation and registration process in Texas. Additionally, I have included instructions at the end on how to apply for your federal Employer Identification Number.

Note: For the purposes of this example, I have assumed the client is a single business owner who wants to form the simplest version of an LLC and does not have an operating agreement.

Texas LLC Application Requirements at a Glance

Before you file, you'll need: a verified, available business name, a Texas registered agent with a street address, a completed Certificate of Formation, and the $300 state filing fee. Below is the full step-by-step application process.

Step 1: Choose and Verify the Availability of Your Business Name

Your first step is to figure out what you want to name your LLC. You can find a helpful list of the do’s and don’ts for naming here, but an important one is that you must include the words “limited liability company,” “limited company,” or an abbreviation thereof (“LLC”) in your business name. This is to inform all your potential customers that they are dealing with a company whose liability is limited by law.

Next, ensure that the name you want isn’t already in use. If a company is already registered in Texas with the same name or a very similar one, you cannot use it. Making minor alterations (adding or removing a space, altering the spelling, or adding one or two letters) won’t work either, as any name that is likely to cause confusion in the marketplace will be rejected.

You can search the Texas Secretary of State’s records to see if a name is in use through SOSPortal, and you can find a list of other ways to run this search here. You will need to create a SOSPortal account to run the search online, but you’ll need one anyway if you intend to file your formation application electronically, so you might as well go ahead and create one now. There is a $1.00 statutorily authorized fee associated with each search.

Step 2: Prepare the Filing Fee

At the time of this writing, the State of Texas charges a $300 filing fee for each LLC application. Although you can file and pay by mail or in person, I have found filing and paying online through SOSPortal is the quickest and easiest way. SOSPortal accepts payment by credit card or ACH.

Step 3: Download The Form

Next, download the “Certificate of Formation for a Limited Liability Company” from the Texas Secretary of State’s website, located here. The form has 3 pages of instructions that I recommend you read before filling out the application. I will also walk you through each section of the application below.

Important Note: if you plan to submit your application electronically through SOSPortal, you don’t need to fill out the form beforehand. The online application process will ask you each question contained in the application and then generate an electronic application for you. However, you should still review the instructions and the application itself to understand what information you will need to provide. If you plan to submit your application by mail or in person, you should use the printed application from the website, linked above.

Step 4: Texas Form 205 Box by Box: What to Enter in Each Section

Form 205 is the Texas Secretary of State's Certificate of Formation for a Limited Liability Company. Whether you file online or on paper, you will answer the same questions. Here is what each section asks for and what most single-owner LLCs enter.

Article 1: Entity Name and Type

Enter your LLC's full name, including "Limited Liability Company," "Limited Company," or an abbreviation such as "LLC." The name must be distinguishable from names already on file with the Secretary of State. A preliminary name search is helpful, but the state does not make a final decision on your name until it reviews your filing, so avoid ordering signs or business cards until your certificate is approved.

Article 2: Registered Agent and Registered Office

Every Texas LLC must name a registered agent to receive legal papers and official notices. You will choose one of two options:

• Option A: a business entity, either a Texas entity or an out-of-state entity registered to do business in Texas (for example, a registered agent service).

• Option B: an individual who lives in Texas. This can be you if you are a Texas resident.

Your LLC cannot be its own registered agent. The person or company you name must agree to serve as your agent before you file this form. You do not have to send their consent to the state, but by signing the form, you are confirming that you have it.

The registered office must be a street address in Texas where the agent can be served in person during business hours. A P.O. box, virtual mailbox, or answering service alone does not qualify. Keep in mind that this name and address become public record.

Article 3: Governing Authority

This section asks who will run the company at the start:

• Option A, manager-managed: the LLC has one or more managers. List each initial manager's name and address.

• Option B, member-managed: the LLC has no managers, and the members run it. List each initial member's name and address.

You must list at least one person. For a single-owner LLC that you run yourself, member-managed is usually the simpler choice. But any sole owner should also consider a durable power of attorney for business owners in Texas to ensure someone else can manage your LLC's financial and legal affairs if you're ever incapacitated or unable to act.

Article 4: Purpose

The form already includes a general purpose statement: the LLC is formed for any lawful purpose permitted under the Texas Business Organizations Code. Most LLCs can leave this as is. If your business needs a state professional license (for example, doctors, dentists, or lawyers), you would generally file Form 206 for a Professional Limited Liability Company instead.

Initial Mailing Address

Since January 1, 2022, Texas requires an initial mailing address on the certificate of formation. The Texas Comptroller uses it to send franchise tax information to your new LLC. Unlike the registered office, this can be a P.O. box.

Supplemental Provisions/Information

This optional space is for additional provisions; most single-owner LLCs leave it blank. For example, Texas LLCs last indefinitely unless the certificate says otherwise, so this is also where you would set a limited duration. If you are considering a series LLC or any special provisions, talk with a business attorney before filling in this section.

Organizer

The organizer is the person or company submitting the filing. Only one is required. An individual organizer must be at least 18, and there is no Texas residency requirement. For most single-owner LLCs, the owner is the organizer.

Effectiveness of Filing

You have three choices:

• Option A: effective when the Secretary of State files the certificate. This is the most common choice.

• Option B: effective on a later date you choose, up to 90 days after you sign.

• Option C: effective when a future event happens, within the same 90-day window. This option requires an extra filing afterward, so it is rarely used for a simple LLC.

Tax Information

Texas LLCs are subject to the Texas franchise tax, which is handled by the Texas Comptroller of Public Accounts, not the Secretary of State. Your federal EIN comes from the IRS (see Step 6 below).

LLCs, like all Texas business entities, are potentially subject to the state-imposed franchise tax. However, any company with under $2,650,000 in annualized total revenue for report years 2026 and 2027 is under the No-Tax-Due Threshold and is exempt from the tax and its reporting requirements. All LLCs, however, must still file an annual public information report (PIR) with the Texas Comptroller by May 15 each year; it discloses active management, officers, directors, members, general partners, and registered agent details. The PIR is an information report, not a tax payment return.

Execution

The organizer signs the certificate. No notary is needed. Signing is a legal statement that the information is true, including that your registered agent agreed to serve. Knowingly filing a materially false certificate is a criminal offense in Texas, so double-check each entry before you submit.

Step 5: Submit Your Application and Payment

As I mentioned above, I have found that submitting your application electronically through SOSPortal is the quickest way to apply. SOSPortal is available 24/7, so you can file online anytime. However, regardless of the option you choose, pleasefollow the instructions for submission and payment on the form carefully.

Once your application has been filed, it will be reviewed by the Secretary of State’s office. If there is a problem, they will return your filing and provide an explanation. Otherwise, you will receive a Certificate of Formation confirming that your application has been granted. This is an important document, so I suggest making copies and a digital scan.

Step 6: Apply for an EIN and Open a Business Bank Account.

At this point, the formation process is actually complete. However, I included this step because it’s equally important. Once you have your Certificate of Formation from the State, you can fill out and submit the Employer Identification Number (EIN ) application from the IRS here. Getting an EIN is free, and the application can be done quickly online.

Even though it’s called an Employer ID Number, you should get one even if you don’t have any employees other than yourself. That’s because the EIN is also used as a Tax Identification Number for your new entity, and you’ll need one of those to open a bank account in your business’s name. Opening a separate account in the name of your LLC is an essential step for several reasons, not the least of which is to start receiving payments.

Do I Need a Lawyer to Form an LLC in Texas?

No. Texas does not require an attorney to form an LLC. You can file Form 205 yourself online or by mail and pay the $300 state filing fee, and many single-owner LLCs are formed this way.

Where an attorney can help is with the decisions the form does not walk you through:

• Operating agreement. Texas does not require you to file one, but it sets out who owns what, how decisions are made, and what happens if an owner leaves, becomes incapacitated, or dies.

• More than one owner. Splitting ownership, contributions, and profits fairly is easier to agree on before there is a disagreement.

• Professional or licensed businesses. These may need a Professional LLC (Form 206) instead of Form 205.

• Series LLCs, special provisions, or a delayed effective date. These choices change how your company works and are harder to undo later.

• Estate planning for your business. Your LLC interest is an asset. Your will or trust, and your operating agreement, should say what happens to it.

A mistake on a formation filing is usually fixable, but it often requires another filing and fee later. If you want a second set of eyes before you file, or help with an operating agreement, you can schedule a free business formation consultation with The Patterson Law Firm.

Next Steps

I hope you’ve found this guide helpful. Ready to form your Texas LLC the right way? Book a Business Formation Consultation with The Patterson Law Firm — we’ll make sure your entity is set up right, with the operating agreements and contracts to protect it long-term.

If you’re a married business owner, it’s equally important to address estate planning for married business owners in Texas to ensure your LLC interest is properly accounted for in your will or trust — and that your spouse is protected.

Disclaimer: This blog is made available by the Caleb Patterson Law Firm, PLLC, to the general public for educational purposes only. Specifically, the entries contained within this blog are designed to provide the general public with general information concerning Texas law. The blog does not provide specific legal advice and does not create an attorney-client relationship between the reader and the Caleb Patterson Law Firm, PLLC. This blog is not an effective or appropriate substitute for obtaining legal advice from a qualified attorney licensed in your state with experience in your practice area or forum of law.