General Guide to Company Incorporation in Texas
Updated on Friday 18th May 2018
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Texas is known as the “Lone Star State”, reminding of the battle for independence with Mexico, and it is the second largest state located in the south region of the USA. Being a major economic engine in USA and having excellent developed industries, Texas is a preferred destination for business by many investors from abroad. We have prepared a general guide to company incorporation in Texas which comprises the main requirements of how companies are established in this state. Our company formation agents in USA are at your disposal with assistance and in-depth information at the time of company incorporation in Texas.
How can I open an LLC in Texas?
Limited liability companies, the most popular business entities in Texas, can be registered with the Business Division of the Secretary of the State of Texas by sending the main documents of the company - the Articles of Association. These need to contain the following:
- complete information about the shareholders (name, nationality, country of residence);
- the company’s activities and the name of the registered agent who represents the firm;
- information about the business address of the company in Texas;
- the name of the appointed managers of the firm in Texas;
- the responsibilities and the rights of each company owner.
If you want to start a business in USA and need information and guidance in this direction, it is suggested to talk to one of our company incorporation specialists in USA.
Do I need an operating agreement for a company in Texas?
Even though it is not mandatory, it is recommended to create an operating agreement for your business in Texas. This is an internal document which comprises information about the status of the owners or, in other words, the liabilities, the voting rights and the capital contribution of the stockholders, as established before the company incorporation. Also, an operating agreement provides information about how the company can be closed.
What other companies can I register in Texas?
Besides a limited liability company in Texas, foreign investors can set up other types of businesses, in accordance with their activities and purposes, such as:
- a general partnership set up by two individuals or associates under a partnership arrangement;
- a corporation which has the attributes of an LLC, with stockholders and board of directors;
- sole proprietorships which can be easily and fast registered in USA, including Texas;
- limited partnerships created by at least two individuals for which an agreement is necessary.
The sales tax in Texas
The sales tax in Texas is set at 6.25% rate, but it can change, depending on the type of purchase in this state. One should know that the municipalities can collect their own taxes in Texas. For complete information about the tax structure in Texas, we suggest you address your inquiries to our specialists who can also provide you with support for USA company formation.
What is EIN for a company in Texas?
Businesses in Texas need to have a tax identification number which is known in this case as the EIN (Employer Identification Number). This federal tax ID is allocated by the IRS (Internal Revenue Service) through the local tax offices. The EIN demonstrates that your company in Texas is a taxpayer.
A bank account in Texas
Another important requirement imposed at the time of company registration in USA, including Texas, is opening the business bank account. Foreign investors should choose the proper financial institution which can meet their needs. It is good to know that there are several important banks in Texas, and these institutions will only ask for the EIN of the company and related documents before opening a bank account for the capital contribution of your firm.
Virtual office in Texas
Foreign entrepreneurs who want to remotely control their businesses in Texas can choose complete virtual office packages. This is a cost-effective service compared to traditional offices in USA. A notable business address, mail and call forwarding, fax services, correspondence collection and bank statements collection are only a few of the facilities offered for foreigners through virtual office packages in Texas.
Economy facts about Texas
Texas has the second highest GDP (gross domestic product) in USA gaining the status of the 4th largest economy in the U.S., sustained by the states’ prolific industries. The agriculture and mining, the manufacturing, the tourism, and the energy sector are among the generous and well-developed fields in Texas. The state is known for its large production of cotton, for the big number of farms and for the fishing industry. Austin is the capital of Texas and a solid business center that welcomes foreign investors in varied sectors. Dallas, San Antonio, Houston, Fort Worth, Arlington or Beaumont are significant cities in Texas with excellent business environments for any kind of entrepreneur.
If you would like to know more about how to open a company in USA, please feel free to contact our team of company formation specialists in USA at any time. We can provide the necessary support for company incorporation in any American state.