How to Register an LLC in Texas

Almost every permit a Texas business will ever hold is issued to a legal entity, so the LLC comes first and everything else is built on it. Registering one is a short process, but it has several pieces that have to agree with each other, and a mismatch between the LLC name, the store name and the bank account is the most common reason a later permit application is rejected. This guide covers each step in order, what the state charges, and the annual obligation that catches most new owners by surprise.

Step 1: Choose a name the state will accept

A Texas LLC name must be distinguishable from every other entity on file with the Secretary of State and must include "Limited Liability Company," "LLC" or "L.L.C." Check availability first; a rejected filing for a name conflict costs time. If the store will trade under a different name, that is handled separately with an assumed name certificate in Step 5.

Step 2: Name a registered agent

Every Texas LLC must designate a registered agent: a person or company with a physical Texas street address, not a P.O. Box, who is available during business hours to accept legal papers and state notices. An owner can serve as the agent at the business address. The agent must consent in writing, and the consent is kept with the company records rather than filed with the state.

Step 3: File the Certificate of Formation

The filing is Form 205, Certificate of Formation for a Limited Liability Company, submitted to the Texas Secretary of State. It can be filed online through SOSDirect, which is processed in a few business days, or by mail, which is slower. The certificate names the LLC, the registered agent, whether the LLC is managed by its members or by managers, the organizer, and the initial members or managers. Once approved, the state issues a file number and a filed certificate; keep both, because every permit application and every bank will ask for them.

Step 4: Get the EIN

The Employer Identification Number is the LLC's federal tax ID, issued free by the IRS online, usually the same day. It is required to open a business bank account and appears on the sales tax, tobacco, lottery, SNAP and TABC applications. Apply only after the LLC is approved so the name on the EIN matches the state record exactly.

Step 5: File the assumed name, if the store name is different

If customers will know the business by any name other than the exact LLC name, Texas requires an assumed name certificate, commonly called a DBA. For an LLC it is filed with the Secretary of State and, in practice, with the county clerk where the store operates. The DBA matters more than most owners expect: the Texas Lottery requires it to be registered on the business bank account, and TABC and the Comptroller expect the trade name on their applications to match a filed DBA.

Step 6: Open the business bank account

Banks require the filed Certificate of Formation, the EIN letter, and the DBA if one exists. Open the account in the LLC's name with the DBA registered on it. The Texas Lottery will not accept a personal account for ticket settlements, and USDA, TABC and the Comptroller all expect business funds to run through the entity.

Step 7: The annual franchise tax report

This is the obligation that surprises new owners. Every Texas LLC must file a franchise tax report with the Comptroller each year by May 15, whether or not it owes any tax. Most small businesses fall below the no-tax-due threshold and owe nothing, but the report is still required. Missing it brings penalties, and a continued lapse leads the Comptroller to forfeit the LLC's right to transact business, which blocks permit renewals and can void the liability protection the LLC exists to provide. We add the May 15 date to the same renewal calendar we keep for permits.

Operating agreement and company records

Texas does not require an operating agreement to be filed, but every LLC should have one, especially with more than one owner. It sets out ownership percentages, who can sign, and what happens if an owner leaves. TABC, the Lottery and USDA all ask for every owner's name and percentage on their applications, and the operating agreement is what those figures come from.

What the LLC unlocks

With the LLC, EIN and DBA in place, the permit stack can start: the sales tax permit first, then tobacco and e-cigarette permits, the TABC permit, the Texas Lottery license and SNAP authorization. The full order is in our guide to every permit a new store needs.

Frequently asked questions

Last reviewed October 2026. Fees and rules change; we verify each one against the agency at the time of filing.