You can choose from for-profit and nonprofit corporations when you start a business in Texas.By naming your company, choosing a registered agent, selecting board members and filing a certificate of formation, you can incorporate in Texas.If you want to do business in Texas, you may have to register your foreign corporation with the state.
Step 1: Don't hesitate to consult an attorney.
The process of choosing a business structure can be difficult.In return for the help of an attorney, you will be able to talk about what you expect your corporation to do and how you want to run your business.Ask your friends and colleagues to give you a recommendation for a business attorney.A lot of people deal with business attorneys through their jobs.They should be able to tell you what they liked and didn't like about their experience.If you can't find a recommendation, visit your state's bar association and use their lawyer referral service.You should be able to find a well qualified and honest attorney if you use these tools.
Step 2: How you want your business to operate is up to you.
Discuss how you want to run your business before you incorporate.Would you like to have passive shareholders or member-managers?Do you want the purpose of your organization to be charitable or commercial?Before you start the process of incorporating, you should ask some questions.
Step 3: You should think about where you want to incorporate.
You don't need to incorporate in Texas in order to do business there.You have the option to incorporate in any state you want.Your corporation will be governed by the law of the state you choose to incorporate in.If you want to do business in Texas, you will have to register your foreign corporation.
Step 4: How will you use your business's profits?
If you want to distribute your profits to shareholders and employees in the form of dividends and bonuses then you should consider creating a for-profit corporation.If you want to take profits and put them back into your business or charity, then you should use a nonprofit corporate structure.
Step 5: Your corporation should be named.
Texas law requires corporations to have a name.You should trademark the name once you come up with it.To trademark a name, you need to visit the federal government's Patent and Trademark Office website, fill out the required forms, and file them online with the applicable fees.The name must include one of the following words or an abbreviation: "company," "corporation," or "limited."The name cannot be similar to another existing or registered business entity in Texas or a name that has been reserved by a Texas business.You can reserve a name for 120 days by filling out an Application for Reservation and paying a fee.There are two ways to reserve a name: online at http://www.sos.state.tx.us/corp/Sosda/index.shtml or by completing Form 501.
Step 6: Directors should be appointed.
The business of the corporation is managed by the board of directors.Ask candidates if they would be willing to act as a director.When you prepare your certificate of formation, you will use the directors' names and other personal information.Corporations in Texas must have at least one director.Directors don't have to have a minimum age requirement.Texas law doesn't require directors to be residents of the state.The certificate of formation may require it.
Step 7: You can choose a registered agent.
Texas requires corporations to have a registered agent.A registered agent is an individual Texas resident, a domestic entity, or a foreign entity that has qualified or registered to transact business in Texas and who is responsible for receiving and forwarding service of process or official notices addressed to a corporation.The entity.Let them know you will be using their name if they are willing to take on this duty.
Step 8: A certificate of formation should be prepared.
A certificate of formation is required in order to incorporate in Texas.The form can be downloaded at http://www.sos.state.tx.us/corp/forms.You don't need to download Form 201 if you are going to file online, but you will need all the necessary information.The form must include the following information: The name and type of entity being formed, the names and addresses of directors and registered agents, and the number and value of initial authorized shares.
Step 9: You should file your certificate of formation.
You must deliver your certificate of formation to the Secretary of State in a number of ways.You will have to pay a $300 filing fee when you file.You can file online at the Texas Secretary of State website.You can fax your paperwork to the number on the Secretary of State's website.
Step 10: You can create byLaws.
Information about internal rules and procedures, responsibilities of officers, the size of the board, and how shareholder meetings will be held should be included in a corporation's bylaws in Texas.Texas law requires you to keep the document at your main office if you don't file it with the Secretary of State.In order to get an idea of what should be included, you can look up sample Texas byLaws.
Step 11: You can request an Employer Identification Number.
Texas requires that you have an EIN, also known as a federal tax identification number, which is used to identify businesses for tax purposes.You can apply for an EIN online at theirs.gov.
Step 12: Corporate records need to be maintained.
Texas corporations are required to keep books and records of accounts, meeting minutes, and a current record of the name and mailing address of their owners.
Step 13: Comply with taxes.
Corporations formed in Texas may be subject to a variety of taxes.
Step 14: You can create a name.
Texas law requires corporations to have a name.You should trademark the name once you come up with it.To trademark a name, you need to visit the federal government's Patent and Trademark Office website, fill out the required forms, and file them online with the applicable fees."Incorporated", or "Company" are not required for your nonprofit organization's name.The name cannot be similar to another existing or registered business entity in Texas or a name that has been reserved by a Texas business.You can reserve a name for 120 days by filling out an Application for Reservation and paying a fee.There are two ways to reserve a name: online at http://www.sos.state.tx.us/corp/Sosda/index.shtml or by completing Form 501.
Step 15: Your certificate of formation needs to be prepared.
The Secretary of State will need your certificate of formation to form your nonprofit.Secretary of State Form 202 is used when forming a nonprofit.A purpose clause, IRS language, and the names of initial directors are required in order to get federal tax-exemption and deals with inurement and dissolution.
Step 16: You should file your certificate of formation.
You need to file a certificate of formation with the Secretary of State.It can be filed online or in person.You can use the website if you are filing online.You will have to pay a $25 filing fee when you file.
Step 17: Prepare the rules of the game.
If you want to file for federal tax exemption, your initial board of directors needs to create a set of byLaws.Information about meetings, leadership, quorums, controls, and committees should be included in the bye.
Step 18: You can request an EIN.
Texas requires that you have an EIN, also known as a federal tax identification number, which is used to identify businesses for tax purposes.You can apply for an EIN online at theirs.gov.
Step 19: Prepare the application for tax-exemption.
The IRS Form 1023 is required to file for federal tax exemption.A $400 filing fee is required for the form to be completed online.Form 1023 must include a copy of your certificate of formation and other required information.
Step 20: State tax exemptions can be applied for.
Unless you file for exemptions, Texas nonprofits are required to pay the same state taxes as for-profit corporations.You have to file for sales, franchise, and hotel tax exemptions from the Texas Comptroller and the Local Tax Appraisal District.
Step 21: Comply with the reporting requirements.
The Periodic Report of a Nonprofit Corporation can be found at http://www.sos.state.tx.us/corp/forms/802_boc.You can file this form online.Form 802 asks you to keep the Secretary of State up-to-date with your corporation's name, directors, officers, offices, and any changes you may have to make.The filing fee is $5.
Step 22: Determine if you are a business.
If you want to do business in Texas, you need to register with the Texas Secretary of State.For-profit and nonprofit corporations are required to register.
Step 23: Decide if you act business in Texas.
If you will be acting business in Texas, you don't need to register your foreign corporation.There are examples of things that are included in the definition of what it means to transact business in Texas.Holding a meeting in Texas is one of the examples.
Step 24: You can register your business name.
The application for registration of an entity name can be completed by you.While this form does not give you permission to transact business in Texas, it allows you to register your business name while you prepare your paperwork.You will have to pay a filing fee when you file Form 502 online.The form requires you to provide information about the entity, the jurisdiction where it was formed and the nature of the business.
Step 25: Prepare an application.
An Application for registration is required for a foreign corporation to do business in Texas.The application requires the following information: Business entity name and type, as well as any assumed names, Federal Employer Identification Number, and Certificate of Existence showing that the company is validly organized and identifying the laws under which the entity formed.
Step 26: You have to file an application for registration.
To file Form 301 with the Secretary of State, you need to do it online.You will have to pay a $750 filing fee when you file.