Texas LLC Cost Guide (2024)

We’ve compiled the most common fees associated with forming an LLC in Texas.

Excellent 4.7 out of 5 stars 15,334 reviews

Last Updated: May 21, 2024

How much is an LLC in Texas?

The fundamental cost to start an LLC in Texas is a $300 state filing fee for the Certificate of Formation. This mandatory fee is the primary expense required to legally establish your LLC. However, the overall expenses can vary depending on additional, optional choices.

Understanding the Texas LLC cost is essential for entrepreneurs embarking on starting a new business in the state. From the initial filing fees to ongoing expenses like annual reports and taxes, the financial requirements of maintaining an LLC vary.

This guide provides a detailed overview of potential fees involved in forming and running an LLC in Texas, including:

By exploring the cost of an LLC in Texas, you can prepare for the financial aspects of business ownership. This article aims to offer a comprehensive breakdown, assisting you in making informed decisions that contribute to a successful enterprise.

Common Texas LLC Fees

Cost ItemPrice
Business Name Reservation$40
Certificate of Formation Filing Fee$300
Certificate of Formation Filing Fee (for Veterans)$0
Registered Agent Fees$0 – $300+ annually
Employer Identification Number (EIN)$0 (Free if directly from IRS)
Operating Agreement Creation$0 – $200
DBA (Doing Business As) Name$25 – $100 (varies by county)
Foreign LLC Formation in Texas$750
Annual ReportNo annual report fee in Texas
Certificate of Status$15

Business Name Reservation Fee in Texas

Opting to reserve a business name is a strategic move for Texas entrepreneurs looking to ensure their desired name remains available prior to formally establishing their LLC. This optional step provides a 120-day hold on the name, giving you plenty of time to prepare and submit your Certificate of Formation.

Certificate of Formation Filing Fee in Texas

The Certificate of Formation is essential for legally establishing your LLC in Texas. A mandatory filing fee of $300 is required, which covers the administrative cost of processing your LLC’s formation documents. 

Veterans are given special consideration in Texas, where this fee is waived to encourage veteran entrepreneurship, significantly reducing the startup costs for qualified individuals.

Registered Agent Fees

Each LLC in Texas must designate a registered agent to handle all official correspondence and legal documents. This is a mandatory requirement, but it offers flexibility: you can serve as your own agent at no cost or opt for a professional service, which generally ranges from $50 to $300 per year.

EIN Fee

An Employer Identification Number, or EIN, is crucial for any LLC planning to hire employees or open a business bank account. Issued for free by the IRS, this federal identifier is akin to a Social Security number for your business, essential for all your tax and financial dealings.

Texas DBA Name Fee

A DBA name allows your LLC to operate under a name other than its legal registered name. This option, which carries a $25 per county filing fee, is particularly useful for branding purposes and must be renewed every 10 years. It’s an optional step that provides flexibility for your business’s public identity.

Foreign LLC Formation in Texas

For LLCs originally formed outside of Texas but looking to operate within the state, registering as a foreign LLC is required. This process involves a $750 filing fee and ensures your business is recognized and able to legally conduct business across Texas state lines.

Texas Annual Report

Although Texas does not require a traditional annual report, all LLCs must file the Texas Franchise Tax Report annually by May 15th. This report is crucial for maintaining compliance with state tax obligations, and while there is no specific filing fee, your LLC may need to pay franchise taxes based on its earnings.

Certificate of Status in Texas

A Certificate of Status, also known as a Certificate of Good Standing, is an important document for LLCs that need to prove their compliance with state regulations. Available for a $15 fee, it’s often required when opening bank accounts, securing funding, or expanding business operations outside of the state.

Operating Agreement

While not mandated by Texas law, having a well-drafted operating agreement is recommended for all LLCs. This internal document clarifies the LLC’s operational procedures, ownership structure, and financial policies. Drafting one can be done independently using online resources, though engaging an attorney to tailor a specific agreement offers additional security and clarity, especially for more complex arrangements.

Ongoing Texas LLC Expenses

ItemPrice
Annual Franchise Tax0.375% – 0.75% of taxable margin
Registered Agent Renewal Fees$0 – $300+ annually
License and Permit Renewals$0 – $200+ annually
Operational Costs (Insurance, Rent, Salaries)Varies widely

Annual Franchise Tax

LLCs in Texas are subject to an annual franchise tax, which is calculated based on the taxable margin of the business. The rate ranges from 0.375% to 0.75%. This tax is a crucial aspect of your financial obligations as an LLC operating within the state.

Registered Agent Renewal Fees

Using a professional registered agent service incurs annual renewal fees. These services handle the reception of legal documents and ensure compliance with state requirements, representing an ongoing cost for those who choose not to act as their own agent.

License and Permit Renewals

The cost of renewing business licenses and permits varies depending on the specific industry and operational needs of your LLC. Regular renewal is essential to maintain compliance with state and local regulations, and these costs should be anticipated as part of your annual budget.

Operational Costs

Operational costs for an LLC can include expenses such as insurance, office space rent, and employee salaries. These are recurring costs that will fluctuate based on the size and scale of your business operations. Planning for these expenses is vital for maintaining a smooth operational flow and financial stability.

While the minimum cost to form an LLC in Texas is $300 entrepreneurs should consider these optional and ongoing expenses when budgeting for their new business. The precise total cost will vary based on individual business decisions and specific regulatory requirements.

Other Texas LLC Costs to Consider

When establishing an LLC in Texas, entrepreneurs need to account for various additional costs associated with their specific business activities and locations. These expenses are vital to consider for comprehensive budget planning.

Seller’s Permit Fee

LLCs engaged in the sale of taxable goods or services must secure a seller’s permit from the Texas Comptroller of Public Accounts. This permit is issued without a fee.

Holders of a seller’s permit are required to collect sales tax from customers and remit it to the state regularly. This can be on a quarterly or annual basis, dependent on the volume of sales. Non-compliance with these obligations can lead to significant penalties, including fines and legal consequences.

Franchise Tax

The franchise tax is a notable obligation for most LLCs in Texas. This tax rate is calculated based on the LLC’s revenue and industry, typically falling between 0.375% and 0.75% of the taxable margin.

LLCs with less than $1.18 million in annual revenue usually qualify for an exemption from this tax. The franchise tax must be reported and paid annually through the Texas Franchise Tax Report. Failure to meet this requirement can result in penalties, interest, and forfeiture of the business’s right to operate in Texas.

Certified Documents

There are circumstances where LLCs may need certified copies of their formation documents or other filings. The Texas Secretary of State charges $15 plus $1 per page for these documents. Expedited processing is available for an additional charge.

Certified documents are often required for activities such as opening bank accounts, securing funding, or registering to do business in other states.

Calculating Your Total Texas LLC Cost

The total cost of starting and maintaining an LLC in Texas can vary based on industry, location, and specific business activities. Here’s how you can estimate your total LLC costs:

  • Create a checklist of all required and potential fees based on your business specifics.
  • Utilize tools like free cost calculators to estimate your expenses.
  • Include additional costs such as website setup, marketing expenses, and professional services like legal or accounting advice.

This approach will help you develop a realistic budget for your LLC in Texas, helping ensure you’re prepared for both expected and unexpected expenses.

We can help!

Running a legal business entity in Texas doesn’t have to be complicated. We’re here to guide you. We’ll help you launch, start and run your new LLC. We’ve done this for more than 500,000 businesses.

Our experts will help you file and avoid costly mistakes and penalties. We also offer endless amounts of business resources to help your LLC succeed in Texas.

FAQs on how to determine Texas LLC costs

  • How much it costs to start an LLC in Texas:

    Texas LLC Filing Fee – $300

    The Texas LLC filing fee is $300. You’ll pay this fee when you file your Certificate of Formation and it is a one time fee when you form your LLC.

    Annual Report Fee – Free

    Some states charge for the annual report fee, but it’s free in Texas.

    Registered Agent Fee – Free

    Every Texas LLC is required to have a registered agent. You can act as your own registered agent for free, or you can have someone serve as your registered agent.  *Our registered agent services make it easy for you. We’ll serve as your registered agent and handle any requirements without any work from you.

  • You paid your Texas LLC filing fee requirement. Can you dodge the other fees? Find out which other fees that might apply.

    Texas Certificate of Status

    You get this document from the Texas Secretary of State. It costs $15. While not required for Texas LLCs, you’ll need one to open a business bank account or get business loans. It’s also known as a Certificate of Good Standing in other states.

    DBA Name in Texas

    Want to “go by” a different name than your LLC name? Submit a “Doing Business As” (DBA) name for just $25. Most LLCs get DBAs when their businesses expand or there’s an unofficial name they want to use for branding purposes.

    Foreign LLC

    If you already have an LLC in another state but want to expand your business to Texas, then you need to file a foreign LLC. The cost to file a foreign LLC in Texas is $750.

    Business Licenses and Permits

    Your type of business may need federal, state or local permits to legally open your doors in Texas. Learn more about Texas business license requirements and permits.

    If you don’t need to worry about these additional fees, the average cost to start an LLC in Texas is just the one-time $300 filing fee.

    For just $0 plus state fees, we can form your Texas LLC for you in just minutes. No LegalZoom promo code required: Pay just $0 plus filing fees for fast LLC formation services.

  • Yes. If you don’t pay your fees, the state can revoke your registration. In addition, If you use an assumed name without registering it, you might be subject to civil or criminal penalties.

  • If you can’t pay your Texas filing fee, the Texas Secretary of State won’t file your documents.

  • You’ll pay Texas formation fees to the Texas Secretary of State: Corporate Section.

  • The Texas filing fees you pay will depend on the type of industry, and location. Usually, the biggest fee is the initial filing fee of $300.

  • The Texas Secretary of State accepts checks, money orders, credit cards (with a convenience fee), or payments through a deposit account system. You can pay with cash if you file in person.

Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

zenbusiness logo

Written by Team ZenBusiness

Texas Secretary of State Contact Information

Mailing Address:
P.O. Box 13697
Austin, TX 78711-3697
Physical Address:
1019 Brazos St.
Austin, TX 78701
Telephone:
(512) 463-5555
Website:
https://www.sos.state.tx.us/index.shtml

Form Your LLC in Texas