How much does it cost to form an LLC in Texas in 2026?

The Certificate of Formation filing fee is $300, paid once to the Texas Secretary of State. SOSDirect adds a 2.7% credit-card convenience fee (around $8 on a $300 filing). A commercial registered agent is another $50 to $125 per year. There is no annual report fee with the Secretary of State and no franchise tax for LLCs with total revenue at or below $2.47 million.

Does Texas have a state income tax?

No. The Texas Constitution (Article VIII, §24) forbids a personal income tax, and the state has no conventional corporate income tax. The Texas franchise tax is a privilege tax on taxable margin, not an income tax, and it exempts entities with total revenue at or below $2.47 million. Members of a Texas LLC still owe federal income tax and any tax owed to the state they personally live in.

Does Texas have an annual report?

Texas has no Secretary of State annual report, but every LLC files an annual Public Information Report with the Texas Comptroller by May 15. There is no filing fee for the PIR itself. As of 2024, entities under the $2.47 million no-tax-due threshold no longer file a No Tax Due Report but still must file the PIR to stay in good standing.

How long does it take to form a Texas LLC?

Online filings through SOSDirect typically clear in 13 business days. Mail filings take around 30 business days. Paper filings can be expedited for $25 per document for roughly 48-hour processing, but expedite service is only available on paper filings delivered or mailed to the Austin office, not on SOSDirect online submissions.

Should I form my LLC in Texas instead of my home state?

Usually no, unless you live or operate in Texas. The $300 formation fee is one of the highest in the US, and the $750 foreign-qualification fee charged to Texas LLCs registering in another state makes the non-resident math unfavorable compared to Wyoming or Delaware. Texas is a strong pick for Texans; it is an expensive pick for everyone else.

Does Texas require an operating agreement?

No. Texas Business Organizations Code §101.052 authorizes what Texas calls a 'company agreement' (equivalent to an operating agreement elsewhere), and does not require it to be in writing or filed. An LLC without one operates under the default rules in TBOC Chapter 101. A written agreement is still strongly advised for multi-member LLCs and for liability-shield protection in litigation.

What is the Texas franchise tax and who owes it?

The Texas franchise tax is a privilege tax on taxable margin under Tax Code Chapter 171. LLCs, corporations, and most partnerships are subject. The no-tax-due threshold is $2.47 million in total revenue for reports due in 2024 and later; entities at or below owe no tax. Above the threshold, rates are 0.375% for retail and wholesale and 0.75% for everyone else on taxable margin, which is computed under one of four alternative methods (70% of revenue, revenue minus COGS, revenue minus compensation, or revenue minus $1 million).

Why is the Texas foreign LLC fee so high?

The $750 fee for a foreign LLC registering in Texas (Form 304) is set by the Texas Business Organizations Code §9.001. Texas sets foreign qualification fees substantially higher than domestic formation, which is unusual in the US; most states charge the same fee in both directions. Forming in Texas costs $300 while qualifying a foreign LLC in Texas costs $750, so entities operating primarily in Texas are generally better off forming locally.

Texas LLC: fees, filing steps, and 2026 costs

$300 Filing fee Online filing available

$400 Year 1 estimate Filing + first year tax + RA

13 days (expedited 48h) Approval Mail ~30d

No annual filing Ongoing Due 05/15 annually

Where Texas fits, and where it doesn't

Good fit for Texas

You live in Texas and your business operates from Texas; you run a Texas-based retail, real-estate, construction, or professional-services company where local formation is the only sensible choice; you are relocating to Texas and want the state's no-income-tax regime on both personal and business income; you are a Texas-based holding entity for real estate or family investments that stays under the $2.47 million franchise-tax threshold.

Skip Texas when

You are a non-resident looking for a cheap, privacy-friendly formation state. Texas is none of those things; the $300 statutory fee is one of the highest in the country, member names land on the annually-filed Public Information Report, and the $750 charged to foreign LLCs qualifying in Texas is the single steepest foreign registration fee in the US. Wyoming at no annual fee-a-year plus Delaware at $300-a-year both beat Texas on total cost unless you genuinely operate from Texas.

What a Texas LLC actually costs

Formation filing fee Paid once at formation $300
Commercial registered agent Annual, estimate $100
Annual state obligations None in this state $0
Year 1 total estimate Formation plus first-year ongoing $400

Registered agent estimate uses a $100 midpoint. Specialist agents start around $50 per year. Full-service formation companies bundle RA for $125 to $200.

Cost across the first three years

Year 1 $400

Year 2 $100

Year 3 $100

How Texas compares on the basics

Online filing File through state portal

Yes

Expedited processing $25 for 48h

Yes

Annual report required Separate report on top of tax

Yes

State-imposed annual tax None beyond income tax

Yes

Written operating agreement required Recommended, not statutorily required

Recommended

Newspaper publication requirement Not required in this state

State sales tax 6.25% state rate

6.25%

How to apply for an LLC in Texas

Pick a compliant LLC name
The name must end in "Limited Liability Company," "LLC," or an approved abbreviation, and must be distinguishable from every other entity on the Texas Secretary of State record. Check availability at the Texas entity search.
Designate a registered agent
Every Texas LLC is required to have a registered agent with a physical street address in Texas. You can serve as your own agent if you live in Texas, or hire a commercial service for $99 to $249/yr. See the Texas registered agent guide.
File Certificate of Formation: Limited Liability Company (Form 205)
Filing fee is $300. Online filing is available through the state portal. Mail filings are accepted. Paid expedite is available for $25.
Apply for a federal EIN
Free directly from the IRS in about 15 minutes (see the EIN guide). Required for opening a business bank account, hiring employees, and most formation-service tax workflows.
Adopt an operating agreement
Texas does not require an operating agreement by statute, but adopting one is strongly recommended to preserve the liability shield. See the operating agreement pillar for the 12 clauses every agreement should include.

Filing walkthrough

You file Form 205 (Certificate of Formation) through the SOSDirect portal. The state fee is $300, and SOSDirect adds a 2.7% credit-card convenience fee on top, so budget around $308 out of pocket. Online processing typically clears in 13 business days; mail filings take around 30 business days. The expedite service is $25 per document for roughly 48-hour turnaround, but expedite only applies to paper filings delivered or mailed to the Austin office, not to SOSDirect online filings.

Texas requires a registered agent with a Texas street address who has consented to serve (Form 401-A is the consent form; most commercial agents handle this automatically). You can be your own agent if you live in Texas. The certificate asks for member-managed or manager-managed structure, the names and addresses of governing persons, and an authorized-person signature. Texas uses the term 'company agreement' rather than operating agreement (TBOC §101.052); it is not required and not filed with the state.

Check name availability File online Texas formation guidance

How Texas taxes an LLC

Texas has no personal income tax (constitutionally prohibited) and no conventional corporate income tax. What it has instead is the franchise tax: a privilege tax on taxable margin under Texas Tax Code Chapter 171. The no-tax-due threshold is $2.47 million in total revenue (SB 3, 2023). Most small LLCs sit well below that line. Above the threshold, the rates are 0.375% of taxable margin for retail and wholesale businesses and 0.75% for everyone else. Taxable margin is computed as the lesser of 70% of total revenue, revenue minus cost of goods sold, revenue minus compensation, or revenue minus $1 million. An EZ computation at 0.331% on revenue up to $20 million is also available.

Even if you owe no franchise tax, you still file. Every LLC files an annual Public Information Report with the Texas Comptroller by May 15, listing the company's governing persons. Entities at or below the no-tax-due threshold no longer have to file a No Tax Due Report as of 2024, but the PIR is non-negotiable.

Sales and use tax is 6.3% statewide, up to 8.25% with local add-ons. Pass-through members still owe federal income tax. Members who live in states with an income tax (California, New York, Oregon) still owe that state on their share of the LLC's pass-through income; Texas's zero does not follow you home.

Ongoing compliance and costs after year one

Budget $0 in annual Secretary of State fees (there is no annual report), plus $50 to $125 for a commercial registered agent. If the LLC earns below $2.47 million in total revenue, the annual franchise-tax obligation is the Public Information Report filing itself, with no tax due. A small operating Texas LLC with a commercial agent typically pays $75 to $125 per year after formation, which is one of the cheapest ongoing totals in the country once you have cleared the high $300 entry cost.

Foreign LLCs registering in Texas are a different story. The $750 foreign-qualification fee is the highest in the US, and you pay it in addition to whatever fees your home-state LLC charges. Forming a Wyoming LLC to do business in Texas costs more than simply forming in Texas.

Common mistakes forming a Texas LLC

Two patterns repeat. The first is missing the May 15 Public Information Report deadline. It is tied to the franchise-tax calendar, not the LLC anniversary, and the Comptroller uses it to keep entities in good standing. A missed PIR can trigger forfeiture of the right to transact business in Texas, which is survivable but a pain to cure. The second is assuming 'no income tax' means no filing. Even LLCs with zero revenue file the Public Information Report every year. Texas does not let you disappear by staying quiet.

State agencies that handle Texas LLCs

Texas Secretary of State, Business & Commercial Section

Website: www.sos.state.tx.us/corp/index.shtml
Phone: (512) 463-5555
Email: corpinfo@sos.texas.gov
Mail: P.O. Box 13697, Austin, TX 78711-3697
Office: James Earl Rudder Office Building, 1019 Brazos Street, Austin, TX 78701
Hours: 8:00 AM to 5:00 PM Central, Monday to Friday

Texas Comptroller of Public Accounts

Website: comptroller.texas.gov
Phone: (800) 252-1381
Mail: P.O. Box 13528, Capitol Station, Austin, TX 78711-3528
Office: Lyndon B. Johnson State Office Building, 111 East 17th Street, Austin, TX 78774
Hours: 8:00 AM to 5:00 PM Central, Monday to Friday

Frequently Asked Questions

How much does it cost to form an LLC in Texas in 2026?

The Certificate of Formation filing fee is $300, paid once to the Texas Secretary of State. SOSDirect adds a 2.7% credit-card convenience fee (around $8 on a $300 filing). A commercial registered agent is another $50 to $125 per year. There is no annual report fee with the Secretary of State and no franchise tax for LLCs with total revenue at or below $2.47 million.
Does Texas have a state income tax?

No. The Texas Constitution (Article VIII, §24) forbids a personal income tax, and the state has no conventional corporate income tax. The Texas franchise tax is a privilege tax on taxable margin, not an income tax, and it exempts entities with total revenue at or below $2.47 million. Members of a Texas LLC still owe federal income tax and any tax owed to the state they personally live in.
Does Texas have an annual report?

Texas has no Secretary of State annual report, but every LLC files an annual Public Information Report with the Texas Comptroller by May 15. There is no filing fee for the PIR itself. As of 2024, entities under the $2.47 million no-tax-due threshold no longer file a No Tax Due Report but still must file the PIR to stay in good standing.
How long does it take to form a Texas LLC?

Online filings through SOSDirect typically clear in 13 business days. Mail filings take around 30 business days. Paper filings can be expedited for $25 per document for roughly 48-hour processing, but expedite service is only available on paper filings delivered or mailed to the Austin office, not on SOSDirect online submissions.
Should I form my LLC in Texas instead of my home state?

Usually no, unless you live or operate in Texas. The $300 formation fee is one of the highest in the US, and the $750 foreign-qualification fee charged to Texas LLCs registering in another state makes the non-resident math unfavorable compared to Wyoming or Delaware. Texas is a strong pick for Texans; it is an expensive pick for everyone else.
Does Texas require an operating agreement?

No. Texas Business Organizations Code §101.052 authorizes what Texas calls a 'company agreement' (equivalent to an operating agreement elsewhere), and does not require it to be in writing or filed. An LLC without one operates under the default rules in TBOC Chapter 101. A written agreement is still strongly advised for multi-member LLCs and for liability-shield protection in litigation.
What is the Texas franchise tax and who owes it?

The Texas franchise tax is a privilege tax on taxable margin under Tax Code Chapter 171. LLCs, corporations, and most partnerships are subject. The no-tax-due threshold is $2.47 million in total revenue for reports due in 2024 and later; entities at or below owe no tax. Above the threshold, rates are 0.375% for retail and wholesale and 0.75% for everyone else on taxable margin, which is computed under one of four alternative methods (70% of revenue, revenue minus COGS, revenue minus compensation, or revenue minus $1 million).
Why is the Texas foreign LLC fee so high?

The $750 fee for a foreign LLC registering in Texas (Form 304) is set by the Texas Business Organizations Code §9.001. Texas sets foreign qualification fees substantially higher than domestic formation, which is unusual in the US; most states charge the same fee in both directions. Forming in Texas costs $300 while qualifying a foreign LLC in Texas costs $750, so entities operating primarily in Texas are generally better off forming locally.
How do I apply for an LLC in Texas?

Apply for an LLC in Texas by filing Certificate of Formation: Limited Liability Company (Form 205) with Texas Secretary of State, Business & Commercial Section. The filing fee is $300. Online filing is available through the state portal. Approval typically takes 13 business days online. Mail filings take about 30 business days. Before filing, pick a registered agent (see the Texas registered agent guide) and confirm your business name is available using the state's entity search.

Compare Texas to another state

Side-by-side breakdowns of fees, taxes, approval time, and compliance. Every other US jurisdiction has a dedicated compare page against Texas.

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Texas vs Louisiana

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Texas vs Pennsylvania

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Texas vs Rhode Island

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Texas vs Tennessee

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Texas vs Utah

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Sources

Filing fee: www.sos.state.tx.us/corp/forms/205_boc.pdf · verified April 21, 2026
Texas Secretary of State Form 205 Certificate of Formation for an LLC. $300 filing fee stated on form instructions. Authority: Texas Business Organizations Code §4.152 (formation fees).
Filing fee: www.sos.state.tx.us/corp/sosda/index.shtml · verified April 21, 2026
SOSDirect service charges a 2.7% convenience fee on credit-card transactions on top of the $300 state fee. The stated filingFee of $300 is the statutory fee exclusive of the payment-processing surcharge.
Expedited filing: www.sos.state.tx.us/corp/options.shtml · verified April 21, 2026
Texas Secretary of State expedite service: $25 per document for expedited processing (typically 2 business days). Applies to paper filings mailed or delivered to the SoS. SOSDirect online filings are normally processed within a few business days without a separate expedite fee.
Annual report fee: comptroller.texas.gov/taxes/franchise/ · verified April 21, 2026
Texas LLCs file an annual Franchise Tax Report and Public Information Report with the Comptroller by May 15. No separate filing fee for the PIR. Under SB 3 (88th Leg., 2nd C.S., effective for reports due in 2024 and later), entities with total revenue at or below the no-tax-due threshold no longer file a No Tax Due Report but still file the PIR.
Franchise tax: comptroller.texas.gov/taxes/franchise/ · verified April 21, 2026
Texas Tax Code Chapter 171 (Franchise Tax). No-tax-due threshold raised to $2.47 million for reports due 2024 forward (SB 3, 2023). Rates: 0.375% retail/wholesale margin; 0.75% other. EZ computation 0.331% on revenue up to $20M (no deductions). Confirm current threshold on Comptroller site each year.
Operating agreement requirement: statutes.capitol.texas.gov/Docs/BO/htm/BO.101.htm · verified April 21, 2026
Texas Business Organizations Code §101.052 authorizes a company agreement (Texas's term for an operating agreement). Not required to be in writing or filed; LLC may operate under default statutory rules.
Foreign LLC registration fee: www.sos.state.tx.us/corp/forms/304_boc.pdf · verified April 21, 2026
Texas Secretary of State Form 304 Application for Registration of a Foreign LLC. Filing fee $750. Authority: TBOC §9.001.
Publication requirement: statutes.capitol.texas.gov/Docs/BO/htm/BO.3.htm · verified April 21, 2026
Texas does not require newspaper publication for LLC formation. TBOC Chapter 3 governs formation filings without any publication requirement.
Business name search: mycpa.cpa.state.tx.us/coa/ · verified April 21, 2026
Texas Comptroller Taxable Entity Search (the broadly-used search for Texas business entities). SOSDirect also offers a paid name search for $1 per request.
Sales tax rate: comptroller.texas.gov/taxes/sales/ · verified April 21, 2026
Texas statewide sales and use tax rate is 6.25%. Local jurisdictions may add up to 2% for a maximum combined rate of 8.25%.

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