How to Register a Business in Texas: Complete 2025 Guide

Texas business registration takes exactly 6 steps and costs between $0-$308 depending on your chosen entity type. The Lone Star State processed over 421,000 new business entities in 2024, making it America's second-largest business formation market behind Delaware.

Texas offers the fourth-largest economy globally with zero state income tax, business-friendly regulations, and streamlined registration processes. This comprehensive guide provides step-by-step instructions, exact costs, processing timelines, and official government resources to register your business correctly.

Understanding Texas Business Registration Requirements

Texas does not require a general business license. Unlike 43 other states, Texas eliminates this barrier for entrepreneurs. However, specific business types require industry licenses, permits, or professional certifications from federal, state, and local agencies.

Business registration requirements vary by entity structure. The Official Texas Starting a Business Guide provides comprehensive documentation for all business types.

Key Registration Facts:

• Zero general business license requirement
• 4 primary entity structures available
• Online filing reduces processing time by 85%
• 24/7 name availability checking through SOSDirect

4 Texas Business Structures: Complete Comparison

Sole Proprietorship

Registration Requirements: None if operating under your legal name
Cost: $0 state filing fee
Liability Protection: None - personal assets at risk
Tax Structure: Personal income tax rates apply

Sole proprietorships require no state registration when operating under the owner's legal name. Using a different business name requires DBA (Doing Business As) filing with your county clerk at approximately $25.

Limited Liability Company (LLC)

Registration Requirements: Certificate of Formation filing required
Cost: $300 state filing fee ($308 online)
Liability Protection: Complete separation of personal and business assets
Tax Structure: Pass-through taxation with election options

LLCs represent 67% of new Texas business formations due to liability protection and tax flexibility. Single-member LLCs receive identical treatment to multi-member entities.

Corporation (C-Corp and S-Corp)

Registration Requirements: Certificate of Formation plus bylaws
Cost: $300 state filing fee ($308 online)
Liability Protection: Maximum protection available
Tax Structure: Double taxation (C-Corp) or pass-through (S-Corp)

Corporations suit businesses planning capital investment, public offerings, or complex ownership structures. Texas corporate law follows Delaware precedents for consistency.

Partnership (General and Limited)

Registration Requirements: Limited partnerships require state filing
Cost: $200-$750 based on partner count
Liability Protection: Varies by partnership type
Tax Structure: Pass-through taxation to partners

General partnerships require no state registration. Limited partnerships must file with the Texas Secretary of State, paying $200 per Texas-resident general partner (minimum $200, maximum $750).

6-Step Texas Business Registration Process

Step 1: Business Name Selection and Reservation

Search name availability through SOSDirect before filing any documents. Texas requires unique, distinguishable business names for each entity type.

Name Requirements:

• Must be distinguishable from existing entities
• Cannot include prohibited words (bank, insurance, trust)
• Must include appropriate designators (LLC, Inc., Corp)
• Cannot mislead regarding business purpose

Name reservation costs $40 and lasts 120 days. This provides exclusive rights during document preparation and prevents name conflicts.

Step 2: Registered Agent Designation

Every LLC and corporation must maintain a registered agent. This individual or company receives legal documents, state correspondence, and official notices on behalf of your business.

Registered Agent Requirements:

• Physical Texas address (no P.O. boxes)
• Availability during standard business hours
• Legal authority to accept service of process
• Written consent to serve as registered agent

Self-service costs $0 annually. Professional registered agent services range from $100-$300 per year and provide additional privacy protection.

Step 3: Certificate of Formation Filing

File formation documents through SOSDirect for fastest processing. Required information includes business name, registered agent details, management structure, and purpose statement.

Filing Options and Processing Times:

• Online filing via SOSDirect: 10-12 business days
• Online filing via SOSUpload: 13-15 business days
• Mail filing: 2-3 months (experiencing delays)
• Expedited mail filing: 10-12 business days (+$25 fee)

Download the current fee schedule for business forms (PDF) for complete pricing information.

Step 4: Federal Tax ID (EIN) Application

Apply for your Employer Identification Number directly with the IRS at zero cost. This 9-digit identifier functions as your business's social security number for tax purposes.

EIN Required For:

• Opening business bank accounts
• Filing business tax returns
• Hiring employees or contractors
• Applying for business credit

Online EIN applications process immediately during business hours. Avoid third-party services charging $50-$300 for this free federal service.

Step 5: Texas Tax Registration

Texas requires no state income tax filings. However, specific tax obligations depend on business activities and structure.

Sales Tax Permit

Required if selling taxable goods or services. Register through the Texas Comptroller's office at no cost.

Taxable Activities Include:

• Retail sales of tangible personal property
• Certain digital products and services
• Restaurant and food service operations
• Professional services (specific types)

Franchise Tax

All LLCs must file annual Franchise Tax Reports by May 15th. Businesses generating under $2.47 million annually owe zero tax but must file reports.

Unemployment Insurance

Businesses with employees must register with the Texas Workforce Commission. Registration activates unemployment benefits coverage for workers.

Step 6: Industry Licenses and Permits

Download the comprehensive guide for State required licenses and permits (PDF) or search the occupational license directory by industry.

Common Licensed Industries:

• Food Service: Health permits, food handler certifications ($250+)
• Professional Services: State board licensing for doctors, lawyers, accountants
• Construction: Contractor licenses, building permits
• Retail: Local permits for signage, occupancy, zoning

Contact your city and county for local requirements, as these vary significantly across Texas's 254 counties.

Special Business Type Considerations

Online Businesses

E-commerce and digital service businesses generally require no general licenses. However, online retailers must:

• Register their chosen business entity structure
• Obtain sales tax permits for Texas customer sales
• Comply with professional licensing if applicable

Online businesses should consider professional web design services and SEO strategies to establish strong digital presence.

Foreign Entities (Out-of-State Businesses)

Businesses formed outside Texas must register as foreign entities to operate legally within state boundaries. The registration fee equals $750 and requires:

• Certificate of good standing from formation state
• Registered agent designation in Texas
• Certificate of Authority filing

Veteran-Owned Businesses

Qualified veterans receive waived LLC formation fees as part of Texas's veteran entrepreneurship support programs. This benefit reduces startup costs by $308 and requires:

• Proof of honorable military discharge
• Texas residency verification
• Standard LLC formation documentation

5 Common Registration Mistakes That Cost Money

1. Skipping name availability searches leads to rejected filings and duplicate fees
2. Forgetting annual compliance requirements triggers penalty fees and potential dissolution
3. Ignoring local permit requirements causes operational delays and fines
4. Using DIY legal documents creates governance problems and liability issues
5. Missing filing deadlines incurs $50 franchise tax penalties and compliance complications

Annual Maintenance Requirements

LLCs Must File:

• Public Information Report annually
• Franchise Tax Report by May 15th
• Address and agent changes within 30 days

Corporations Must File:

• Statement of Information annually
• Franchise Tax Report by May 15th
• Board meeting minutes documentation

All Entities Must Maintain:

• Registered agent designation
• Current address information
• Required business records
• Professional licenses (if applicable)

Complete Cost Breakdown

Initial Registration Costs:

• Sole Proprietorship: $0 (no DBA required)
• LLC: $308 (includes online filing fees)
• Corporation: $308 (includes online filing fees)
• DBA Filing: $25 (county-level filing)

Optional Service Costs:

• Name Reservation: $40 (120-day protection)
• Registered Agent Service: $100-$300 annually
• Expedited Processing: $25 additional fee
• Professional Licensing: Varies by industry

Estimated Total Investment:

Basic LLC with self-service registered agent: $308
Full-service LLC with professional support: $600-$900

25 Frequently Asked Questions

1. How much does business registration cost in Texas?

Basic LLC or corporation registration costs $308 when filing online, including the $300 state fee and $8 convenience charge.

2. Can I register a business online in Texas?

Yes, file through SOSDirect for 10-12 business day processing or SOSUpload for 13-15 business days.

3. Does Texas require a general business license?

No, Texas eliminates general business licensing requirements, reducing barriers for entrepreneurs.

4. How long does LLC approval take in Texas?

Online filing through SOSDirect processes in 10-12 business days. Mail filing takes 2-3 months currently.

5. Can single individuals form LLCs in Texas?

Yes, Texas permits single-member LLCs with identical liability protection and tax benefits as multi-member entities.

6. What documents do I need for business registration?

Certificate of Formation, registered agent consent, and applicable fees. Corporations also require bylaws and stock structure documentation.

7. Can I serve as my own registered agent?

Yes, if you maintain a Texas physical address and availability during business hours for document acceptance.

8. Do LLCs pay annual fees in Texas?

Texas requires no LLC annual report fees. However, Franchise Tax Reports must be filed annually by May 15th.

9. Can foreign entities operate in Texas?

Yes, after filing Certificate of Authority as a foreign entity and paying the $750 registration fee.

10. Are there veteran benefits for business registration?

Qualified veterans receive waived LLC formation fees, reducing costs by $308 through veteran support programs.

11. What business names are prohibited in Texas?

Names suggesting banking, insurance, or trust services without proper licensing. Names must be distinguishable from existing entities.

12. Can I change my business name later?

Yes, through Certificate of Amendment filing with appropriate state fees and registered agent notification.

13. Do I need an attorney for business registration?

Basic registrations can be completed independently. Complex structures or multi-state operations benefit from legal counsel.

14. What happens if I don't maintain compliance?

Penalty fees, potential dissolution, loss of liability protection, and operational complications may result.

15. Can I register multiple businesses under one entity?

Separate legal entities require individual registrations. DBAs can operate multiple trade names under one entity.

16. How do I dissolve a Texas business entity?

File Certificate of Termination with the Secretary of State and complete final tax obligations.

17. Are there industry-specific registration requirements?

Many industries require professional licenses, health permits, or regulatory approvals beyond basic entity registration.

18. Can I register a business without a Texas address?

You need a registered agent with a Texas physical address. The business itself can operate from anywhere.

19. What records must Texas businesses maintain?

Formation documents, operating agreements, meeting minutes (corporations), financial records, and tax filings.

20. How do I verify my business registration status?

Search the Texas Secretary of State database through SOSDirect using your entity name or filing number.

21. Can I expedite the registration process?

Online filing is fastest (10-12 days). Expedited mail processing costs an additional $25 but still takes 10-12 days.

22. Do I need a business bank account immediately?

No legal requirement, but highly recommended for liability protection and clean financial records.

23. What if my desired business name is unavailable?

Choose an alternative name or consider name variations. Reserved names may become available after 120 days.

24. Are there ongoing compliance requirements?

Annual franchise tax reports, address change notifications, and professional license renewals (if applicable).

25. Can I convert between business entity types later?

Yes, through formal conversion procedures or dissolution/reformation processes with appropriate state filings.

Next Steps: Launch Your Texas Business Successfully

Texas business registration provides the legal foundation for entrepreneurial success. With no state income tax, business-friendly regulations, and streamlined processes, Texas offers exceptional conditions for business growth.

Essential Next Actions:

1. Search name availability on SOSDirect
2. Choose appropriate business structure for your goals
3. Gather required documentation and filing fees
4. File formation documents online for fastest processing
5. Obtain federal EIN and complete tax registrations
6. Research industry-specific licensing requirements

Ready to transform your business idea into reality? Begin your Texas business journey today by checking name availability and following this complete registration guide. Whether launching a Houston-based service business, developing an e-commerce platform, or expanding an existing operation, proper registration establishes the foundation for long-term success.

Consider partnering with experienced business consultants who understand Texas business requirements and can guide you through the registration process efficiently. Professional guidance often prevents costly mistakes and accelerates your path to operational status.

Starting a business requires comprehensive planning beyond registration. Consider these essential next steps:

• Complete guide to starting a business in Texas covers market research, business planning, and launch strategies
• Texas business license requirements provides detailed industry-specific licensing information
• Professional web design services help establish credible online presence
• Digital marketing services drive customer acquisition and growth
• SEO strategies for websites improve search visibility and traffic

Need Additional Help?

For questions about starting your business in Texas, contact:

Texas Economic Development & Tourism
PO Box 12428, Austin, TX 78711
Phone: 512-936-0100
Website: texas.gov/starting-business-texas

You can also email the Governor's Small Business Assistance team at smallbusiness@gov.texas.gov for additional resources and support.