How to Start a Company in Texas
Starting a company may be a risky endeavor, but with the proper research and planning it can turn into a rewarding experience. The Small Business Administration estimates roughly 50 percent of all businesses fail within the first five years. For that reason, new businesses need a good business plan that includes items such as competitor analysis and marketing strategy. Lack of corporate or personal income tax appears as one of many reasons to start a business in Texas.
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Instructions
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Attend business seminars in Texas. Small Business Development centers in San Antonio, Houston, Dallas and Lubbock provide training and counseling services for new entrepreneurs. Information regarding financing the business, developing a business plan and other business startup advice will be provided to new Texas companies.
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Select a business location. Choosing a location may be one of the most important decisions business owners will make. A Texas company may be home-based or have an office location. Business owners in need of an office or retail space must consider factors like ease of access for customers. Having ample parking around the business increases the likelihood customers will patronize the business. The location also should fit the company type. For example, a Texas manufacturing company may be less concerned with traffic, but more concerned with the size of the location.
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Select a structure for the company. The state of Texas allows a business to form as a sole proprietor, partnership, limited liability company (LLC), limited liability partnership (LLP) or corporation. Business structure has a huge impact on the legal, tax and operational aspects of a Texas company. For example, a Texas sole proprietor has unlimited liability for all business debts and losses. However, Texas sole proprietors do not have to file annual reports or file taxes on the business level. Owners of a Texas LLC have personal asset protection, but must file articles of organization and pay the corresponding Texas filing fee.
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Choose a company name. According to the Business website, Texas sole proprietors and partnerships may use their personal name or file an Assumed Name Certificate with the Texas county clerk's office where the business operates. Texas LLCs, corporations and LLPs must file an Assumed Name Certificate with the Texas county clerk's office and the Texas secretary of state's office. Businesses registered in Texas may not share the same business name.
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File the appropriate documents with the state of Texas. For example, if you're organizing your Texas business as a corporation, articles of incorporation must be filed with the Texas secretary of state's office, including payment for filing fees.
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Contact the Internal Revenue Service. Obtain an employer identification number (EIN) from the IRS via fax, phone, online or mail. An EIN allows the IRS to identify a business in the same manner as a Social Security number is used to identify a U.S. citizen. The IRS issues an EIN for immediate use through its website or by speaking with an IRS representative on the phone. An EIN may take up to four weeks to receive by mail and up to four business days via fax.
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Obtain Texas permits and licenses. Texas businesses engaged in selling taxable goods and services must obtain a sales tax permit from the Texas comptroller of Public Accounts. The types of licenses and permits required to operate a Texas business depend on the nature of the business. Information regarding necessary permits and licenses for a Texas business can be obtained at the city or county clerk's office where the business resides or on the State of Texas Office of the Governor website.
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Hire employees. When hiring workers, companies must notify the IRS as well as the state of Texas. Furthermore, Texas businesses with employees must also register for Texas State Unemployment Tax and Workers' Compensation Insurance. This can be accomplished by visiting the Texas Workers' Compensation office or the Texas Workforce website.
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