Frequently Asked Questions

Step 1: Select the Type of LLC based on your needs. For example, Single Member LLC for Proprietorship, Multiple members for LLC or Partnership and understand the differences and their Pros and Cons.

Step 2: Make sure that you come up with a unique name that is available in Texas. You can check this on the Secretary of State (TX SOS) website. Note, that you will need an Account/Log-in for this, which you can create for Free.

Step 3: Decide if you want to handle the periodic changes and maintenance yourself or need assistance. Credpw can act as your registered agent in Texas by receiving legal documents on your behalf and handling this for your firm/LLC.

Step 4: Fill out Form 205 on the TX SOS Website - Certificate of Formation for a Limited Liability Company (LLC) with a filing fee of US$ 300 paid out to the Texas Secretary of State. If you need help with this, then Credow can offer the application and thorough guidance on completing it.

Step 5: Wait to hear back from the Texas Secretary of State office. You can expect a letter in the mail within 10 business days.

Step 6: Apply for an Employee Identification Number (EIN) for your firm with the IRS. This can be done online or by mailing out Form SS-4 to them. This acts like a Social Security Number but only for your business, and is required for you to operate your business. For example, you cannot open up your business bank account or file your tax returns without an EIN. Here also Credpw can help you file and obtain this on your behalf.

Step 7: Make an LLC/Company Charter (also known as an Operating Agreement), a formal record that spells out who owns the LLC and how it will operate. In Texas, this is not required but highly encouraged when forming an LLC, especially if more than 1 member is involved. For clarifications and guidance on drafting an Operating Agreement, you can always consult with Credow to cover all your bases.

When applying the Certificate of Formation for an LLC (Form 205) to the Texas Secretary of State, there is a filing fee of US$ 300 (US$ 308 for online application) that has to be paid. Additionally, a fee of US$ 30 is required for obtaining a certified copy of a Certificate of Formation, and a fee of US$ 5 is charged for a Certificate of Status. Both of these options are highly suggested following the creation of a corporation in Texas. In Texas, reserving a company name costs $40 per application. For registered agent services, there are additional fees.

Online applications for a Texas LLC can take up to three business days, while postal applications can take seven to ten days. The paperwork review process at the government office often takes a day or two. There will be no need to wait if clients have previously reserved the company name after doing a background check.

The Article of Incorporation of an LLC allows its owner(s) to set a termination date. If the corporation wants to keep operating after that date, it must choose a new date and file a notice with the Texas government. If the LLC's termination date is left blank, it remains in effect indefinitely. Since Texas does not mandate an annual report, the owner(s) can decide when the license will expire.

The owners may also agree to terminate the LLC following the occurrence of a specified event, such as the filing of bankruptcy or the death of a member, which will cause the LLC to terminate in Texas. Therefore, Credow strongly suggests an LLC for clients setting up a small business in Texas due to its adaptability.

The response is no, it is not. An LLC establishes the business's legal identity, whereas a license authorizes it to offer goods and services in a particular market. This means that an LLC is distinct from a business license in every way. The LLC's owner(s) can't apply for permits until the company itself is established. Credow is glad to answer any questions about business licenses and assist with the application process for those who require it.

Companies in Texas (including LLCs and corporations) are exempt from filing yearly reports with the Secretary of State, but they are required to file a public information report, a No Tax Due report, and a franchise tax statement. In addition, a financial audit is a necessary procedure for several businesses. This may be stipulated in the company's bylaws or imposed by its investors. Credow highly recommends accounting services in Texas for a variety of reasons.

Accounting services in Texas may help business owners save time and money, reduce the likelihood of a tax audit, monitor the company's financial standing, and ensure they are always prepared for tax season.