Starting a limited liability company (“LLC”) in Texas is an attractive option for small business owners considering the advantages of legal protection, ease of management, and tax benefits. Before you can get your business up and running, there are several considerations to be aware of—from registering your LLC with the state to drafting a company agreement. Let's take a look at a few considerations before forming an LLC in Texas.
When selecting the structure of your LLC, it's important to consider how much flexibility you want when it comes to managing the company. For example, if you want more control over decision-making and operations, then a single-member LLC might be best. On the other hand, if you require additional capital or prefer shared decision-making authority among multiple members or shareholders, then a multi-member LLC may be the better choice.
Another key consideration is appointing an official registered agent for your LLC. The registered agent serves as a representative for the company and is responsible for receiving service of process notices as well as other important documents on behalf of the LLC. The registered agent must have a physical address in Texas and be available during normal business hours. They can be either an individual or another business entity such as a professional registered agent service.
Once your LLC has been established and registered with the state, it's important to draft a comprehensive company agreement that outlines each member's rights and responsibilities within the organization as well as provisions for winding down or dissolving the business in case of death or disability. This document should also include information about voting rights, capital contributions by members, decision-making authority amongst members, distributions of profits/losses amongst members, etc. A detailed written agreement helps avoid potential disputes between members down the line by clearly setting out expectations from day one.
Forming a limited liability company in Texas is an attractive option for small business owners who are looking for legal protection from personal liabilities associated with their businesses while also enjoying certain tax benefits that come along with owning an LLC. It’s important to think about multiple considerations when considering forming an LLC in Texas: having single-member or multi-member ownership, having access to adequate capital, appointing a qualified registered agent, and having proper documentation outlining each member’s rights and responsibilities within the organization. Discussing these considerations with a qualified attorney will start your business off on the right path.
Contact Provident Legal Counsel today to discuss your case and legal options. Schedule a Consultation or call (214) 432-6100.