How to Incorporate a Business in Texas

A corporation is an entity that legally separates the business's financial liability from its owners and shareholders. Texas offers one of the best environments for new businesses and many entrepreneurs incorporate in the state.

Difficulty: Moderate

Instructions

1. Download Form 201 from the Secretary of State's Web site (see Resources, below). You may also contact the Secretary of State's office by calling [phone].

2. Insure that the name you'd like to use for your business is available by searching the business database. This service is free to use.

3. Complete the Name Reservation form to reserve a name for your corporation. A fee is required to reserve your corporation's name, but you need to reserve a name in order to complete the Application for Registration.

4. Complete the Application for Registration in order to incorporate your business in Texas. There is a fee for filing an Application for Registration with the state.

5. Allow 6 to 8 weeks for your Application for Registration to be processed. Once done, you will receive a certified copy of your Articles of Incorporation and your Employer Identification Number (EIN).

Tips & Warnings

• Legal counsel is not required in Texas to incorporate your business, but it is advisable, particularly if you have little to no experience with the start-up process.
• Filing for acceptance of a foreign corporation requires Form 301, whereas in-state corporations will use Form 201.
• Weigh the benefit against the added cost before relying on an online service. While online services offer assistance with the startup process, handling paperwork and checking on name availability, they can be costly.
• Realize that incorporating doesn't mean the shareholders can't be held liable for the company. It simply limits their financial liability by the amount of their investment.

Resources

• Visit the Texas Department of State Web site to find the forms needed to incorporate
• Get up-to-date information on business law from the FindLaw.com Web site

Who Can Help Sponsored

• Start Your Business Now - LegalZoom
• Fax without a fax machine! Over 11 million people use eFax® to fax online. Get your free trial today
• Onebox® - Virtual Phone System for Small/Medium Businesses. Service includes Toll Free, Local Number, Call Forwarding, Voicemail, Online Fax & more. Free Trial!

[doggettlaw]

on 8/5/2009 To incorporate in Texas, one files a "certificate of formation" with the Texas Secretary of State. The form number varies by entity. If filed on-line, the turnaround time is typically one day. There is no requirement to register the name in advance. A foreign entity that transacts business in Texas must register with the Texas Secretary of State by filing an application for registration. For more info or legal help, go to www.doggettlawfirm.com

[bedrockmg]

on 3/19/2009 I just completed this process and you don't have to complete the name reservation in order to register. I faxed in my registration form and it was processed within 2 days so the name reservation was not necessary unless you intead to register much later.