Texas LLC has proven to be a flexible yet easy legal entity to use for owning and operating a business in Texas. However, it is essential when forming a Texas LLC that you ensure that the entity is properly and fully organized in accordance with the Texas LLC requirements. Learn about the most common mistakes made during the Texas LLC formation process.
To make sure your filing for a Texas LLC goes smoothly, you need to make sure you don’t make one of the common mistakes that people make. Once a submission is rejected and returned to you, the process can be much longer to correct the error and get the Texas submission back on track for training.
A common reason for a rejected submission is that the fee paid is incorrect or payable in the wrong name to the State Agency. This is one that can be fixed simply by following the requirements in the regulations.
Texas charges an initial filing fee of $300, but other fees are usually 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 or apparently similar to another name 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 which names are different enough from other names to be accepted. It has a long list of naming-related rules that must be strictly adhered to.
A third reason for rejected filings is when your filing documents are missing required information. Information required 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 that the names and addresses of the initial members of a member-operated business be included in the filing document. If the business will be managed by managers, the names and addresses of the initial managers must be included. This is a requirement that is not typical in most other states where this information can be kept private.
The above discussion covers the essential steps to forming an LLC in Texas. Avoid the common reasons for rejection as they will greatly delay your training. Also know that when a filing is accepted, the training is not all you need to complete to preserve the liability protection that Texas provides.
After forming a Texas LLC, learn what you need to do next to properly maintain the Texas LLC so that it continues to provide protection for you personally and your LLC business.
