Forming an LLC in Texas? Avoid the Most Common Mistakes

The Texas LLC has proven to be a flexible yet easy to use legal entity for owning and operating a Texas business. However, it is essential when forming an LLC in Texas that you ensure that the entity is properly and completely organized in accordance with Texas LLC requirements. Learn about the most common mistakes made during the Texas LLC formation process.

In order to ensure that your filing to form a Texas LLC goes smoothly, you must be sure you do not make one of the common mistakes made. Once a filing is rejected and sent back to you, the process can be much longer to fix the error and get the Texas filing back on track for formation.

A common reason for a rejected filing is that the fee paid is wrong or made payable to the wrong name for the State Agency. This is one that can be fixed by just following the requirements in the regulations.

Texas charges an initial filing fee of $300 but other charges are typically added depending on how you submit your filing.

A second reason for rejected filings is the use of an LLC name that is not acceptable in Texas. You need a name that is not the same as of deceptively similar to another name being used by another Texas LLC or other legal entity in Texas.

The State of Texas is one of the strictest states when it comes to what names are sufficiently different enough from other names to be accepted. It has a laundry list of name related rules that must be strictly complied with.

A third reason that causes rejected filings is when your filings documents are missing mandatory information. The required information when forming an LLC in Texas includes proper terminology, an official principal office address and detailed information about the registered agent and registered office.

Texas also requires the names and addresses of the initial members of a member managed business to be listed in the filing document. If the business will be manager managed, then the names and addresses of the initial managers must be included. This is a requirement not typical in most other states where this information can be kept private.

The above discussion covers the essential steps for forming an LLC in Texas. Avoid the common reasons for rejection as these will greatly delay your formation. Also know that when a filing is accepted, formation is not all you need to complete in order to preserve the liability protection afforded by a Texas.

After forming an LLC in Texas, learn what you need to do afterwards to properly maintain the Texas LLC so it will continue to provide protection for you personally and your LLC business.

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