Texas Incorporation Services
To start a corporation in Texas, you must file a Certificate of Formation with the Texas Secretary of State. You can file the document online, by mail or in person. The Certificate of Formation costs $300 to file. Once filed with the state, this document formally creates your Texas corporation. However, to actually ready the corporation to do business, you must complete several additional steps.
Starting a Texas Corporation Guide:
Texas Corporation Filing Options
Skip the state fees! Get a Texas corporation and the best of our services today. Includes EIN, hassle-free maintenance, business address & mail forwarding, Privacy by Default®, local Corporate Guide® service, and everything you need to operate at full capacity.
Do It Yourself
Sign up for a free account and use our online tools to start your Texas corporation today. Includes Texas incorporation and maintenance walkthrough and company document creation. All for free.
Pay in Full
Includes Texas corporation, business address & free mail forwarding, Privacy by Default®, lifetime support from local Corporate Guides® and a year of registered agent service.
Texas Certificate of Formation Requirements
To form a Texas corporation, you must complete and file the Certificate of Formation with the Secretary of State. See the document below and click on any number to see what information is required in the corresponding section.
Your name must include “Corporation,” “Company,” “Incorporated,” “Limited,” or an abbreviation for one of these words. Tip: Most corporations keep it short and sweet with “Corp” or “Inc.”
List either a business (but not your own) or an individual Texas resident (such as yourself). Tip: As you might expect, we recommend Northwest Registered Agent, LLC.
This Texas street address is where your registered agent will be available to accept legal notices for your corporation. Like all the information in your Certificate, this address will become part of the permanent public record of your corporation. Tip: When you hire Northwest, our Texas office address goes here.
You’ll need to list the name and address of at least one director. The address can be a business address instead of a personal address. Tip: Hire Northwest as your registered agent and you can use our address here.
List the number of shares you’re creating and the par value for each, if any. Par value (also known as face value) is the price listed on stock certificates and is typically the lowest price at which a share is traded. If you have multiple classes or series of shares, you’ll need to attach a statement explaining the number, par value, rights and limitations for each share type.
Your organizer signs your Certificate of Formation. You need at least one organizer, but it doesn’t have to be anyone in your corporation—just a person or business you authorize to submit your Certificate. Tip: We’ll be your organizer when you hire Northwest to form your Texas corporation.
When do you want your business to start? You can choose to have it begin upon filing, or you can choose a specific date or event to begin (as long as it’s within 90 days of filing). Tip: Most corporations begin upon filing.
How much does it cost to start a Texas corporation?
The state charges a $300 filing fee to submit a Certificate of Formation. If you pay with a credit card, there’s also a 2.7% convenience fee.
Hire Northwest to form your Texas corporation, and your total out-the-door cost is $535. This includes state fees, a full year of registered agent service, and loads of forms and tools to help get your business off to a strong start.
How long does it take to start a Texas corporation?
For the fastest filing time (2 business days), file online or in person. If you file by mail, it could take 5-7 business days days to receive your stamped copy back in the mail.
If you hire Northwest to start your corporation, we file online and typically have your Texas corporation formed within 2 business days.
Does a Texas corporation need a registered agent?
Yes, your corporation must have a Texas registered agent. You’ll have to list the name of your agent and their registered office in your public Certificate of Formation. Your agent will also need to be regularly available at their registered office during business hours. You could try to save a few bucks by appointing yourself or someone in your corporation—although the job can be pretty frustrating. No one wants to have their personal information listed online. Starting a business shouldn’t have to mean making all your personal information free for the taking. And it’s hard to be stuck in the office, giving up your freedom to come and go when you need to. Need to drive across the state to meet a client? Or pick up supplies? You should be able to do these things without having to worry about missing a process server.
This is why many corporations choose to hire are registered agent service like Northwest. We list our address in your Certificate of Formation (instead of yours). We accept, scan and send notices the same day. We’re ready and waiting in the office so you can spend your time doing what you really want to do: running your business.
Another perk of our Texas registered agent service? We include FREE mail forwarding (5 mail scans per year). Need more scans? Upgrade to our premium Texas mail forwarding service for $40 a month.
Create Bylaws for Your Texas Corporation
Do I need bylaws?
Absolutely. You’ve poured your heart and soul (and money) into starting your business. It would be crazy not to take the time to put into writing how corporate decisions will be made—and who will have authority to make those decisions.
Why are corporate bylaws important?
Your bylaws determine how your corporation will actually operate. Can any officer just go and sign a contract? Can the corporation loan money to a director or officer? Can anyone call a meeting? Do shareholders have to be physically present at a meeting to cast a vote? How long do you want board members to serve? How about officers? Even if you haven’t given much thought to these things before, odds are you have an opinion. The answers to these types of questions are what make up your bylaws.
Do I have to write bylaws?
Not from scratch. Because your bylaws are so critical, we give you free corporate bylaws when you hire Northwest to form your Texas corporation. We’ll give you other key forms as well, from resolutions to meeting minute templates. We’ve spent years refining and developing our forms to ensure our clients have everything they need and can start out on the right foot. Take a look at the free corporate forms we provide to help corporations form and maintain their businesses.
Get an EIN for Your Texas Corporation
Do I have to get a tax ID number (EIN)?
Yes, your corporation is required to get a federal tax ID (also called an EIN or FEIN). You’ll use this ID when you file federal taxes. You’ll likely need your EIN for other business paperwork too, such as opening a corporate bank account or applying for a Texas Sales Tax Permit.
How do you get an EIN? You can fill out the IRS’s application for no fee. Or, skip the extra paperwork and hire Northwest. You don’t even need an extra form—just tick the box that says “EIN service” during checkout when you sign up for our Texas incorporation service.
Open a Bank Account for Your Texas Corporation
To open a corporate bank account, you will need to bring the following to the bank:
- A copy of the Texas corporation’s Certificate of Formation
- The Texas corporation’s bylaws
- The Texas corporation’s EIN
If your bylaws don’t specifically assign the power to open a bank account, you may also want to bring a corporate resolution to open a bank account that states that the person going to the bank is authorized by the business to open the account in the name of the corporation.
We recommend calling your bank ahead of time before going in and asking what their requirements are. Most banks don’t open corporate accounts nearly as frequently as personal accounts, so some bankers may be unfamiliar with their own bank’s requirements. As frustrating as that may be for you, calling ahead will help save you from being super annoyed when you walk into the bank.
Obtain a Business License
Does a Texas corporation need a business license?
The state doesn’t require a general business license. Instead, the licenses and permits you need will depend on what you do and where you’re doing business.
For instance, most businesses will need a Texas Sales Tax Permit, which is required to sell tangible goods or services in the state. Different cities and counties have their own specific licensing requirements as well. El Paso, for example, issues a variety of licenses for businesses such as laundries, flea markets, spas and tattoo studios.
File Texas Corporation Reports
What is the Texas Public Information Report and Franchise Tax?
The Texas Franchise Tax is a tax for the privilege of doing business in the state. Your tax base is your corporation’s taxable margin (which can be calculated a few different ways: 70% of total revenue, total revenue minus cost of goods sold, total revenue minus compensation or total revenue minus $1 million). Whew.
If calculating your taxable margin wasn’t difficult enough, different businesses pay different rates. The standard rate is 0.75%, but qualifying wholesalers and retailers pay a 0.375% rate. There’s also an “EZ Computation” rate of 0.331% for businesses with less than $20 million in total revenue. Frankly, it’s a complicated tax, and most businesses need the help of a CPA or other financial specialist.
Who is subject to this tax? If you do business in Texas, odds are you have to file. Nearly every entity type—LLCs, LLPs, S corps, regular corporations, and more—is subject to this tax.
Even if you don’t owe any tax, you’ll need to file. The Franchise Tax filing includes a Public Information Report, which is mandatory for corporations. The Public Information Report is essentially an annual report, updating the state on your contact and ownership information. Your report and tax filing are due by May 15th. File late? Be prepared to pay up. There’s a $50 late fee plus 5-10% of tax owed.
How much does a corporation in Texas cost each year?
There’s no set annual fee to have a Texas corporation, but you will have to file a Public Information Report and Texas Franchise Tax each year and pay any tax owed.
Pay Corporate Taxes
What are the taxes for a Texas corporation?
Texas is one of the few states that doesn’t have a corporate net income tax. There’s no personal net income tax either, so the biggest tax consideration is the Texas Franchise Tax described above.
The state sales tax is 6.25%. Local sales taxes are typically added on as well. For instance, the five biggest Texas cities (Houston, San Antonio, Dallas, Austin, and Fort Worth) all have a total sales tax rate of 8.25%. El Paso and Arlington are a bit lower at 7.25% and 8% respectively.