Creating your LLC with Realty Law, PLLC
Are you thinking about starting your own business but are unsure of the steps to take? Whether you need a new LLC or have a question about starting an LLC, Realty Law PLLC can help. We will guide you through the process with ease and make sure that your company is up to date with all necessary paperwork.
What Is LLC and what are the benefits of having an LLC?
There are a lot of different types of legal structures for a business, one of the most popular is the Limited Liability Company (LLC). An LLC offers the benefits of both a corporation and a partnership while avoiding some of the drawbacks.
An LLC offers its owners limited personal liability in case of business debts and lawsuits. This is in contrast with a sole proprietorship or partnership, in which the owners are personally liable for all debts and lawsuits against the business. In other words, if your LLC gets sued, the plaintiff can only sue the LLC itself, not you personally. This can be a great way to protect your assets from potential business liabilities.
Steps to Starting an LLC
1. Choose a Name for Your LLC
The first step in forming your LLC is choosing a name for it. The name must be unique within your state and must include the words “limited liability company” or “limited company”.
2. Choose a Registered Agent.
Every LLC must have a registered agent. The law requires that the registered agent for a business entity by an individual or corporation that is not associated with any related party, meaning no family member or officer/director. All states require that a business maintain a registered agent if the business has (1) at least one person who is an officer, (2) operations within the state, or (3) at least one employee of that business physically located within the state.
What Are the Registered Agent Requirements? To establish a legal business entity, it is necessary to file a document with the Secretary of State of Texas. This document is known as Articles of Organization and also includes articles required by law.
3. File The Texas LLC Certificate of Formation
The Certificate of Formation allows the company to be formally registered with the secretary of state. Companies will not be able to conduct business until this certificate is filed. The Texas Secretary of State handles all business filings for companies in the state.
4. Create a Texas LLC Operating Agreement
A Texas LLC Operating Agreement is a document that governs the management and operation of the company, protecting both the company and its members from potential risks. This list is composed of items that should be included in your Texas LLC Operating Agreement. It is not meant to be exhaustive, but rather a starting point for your agreement.
1) Name of organization: What will you name your company? What are all the possible names? What does it stand for?
2) Registered agent: Who will be your registered agent? How will they know what to do when needed? Do they need a license to do this job? What are their duties and responsibilities as a registered agent? Who can act as a registered agent or what type of person should act as a registered agent (someone who
has a similar title)?
3) Mailing address: Where will the LLC deliver mail? What are the hours of operation? Is this address a physical location or just an office? Who has access to the mail during these hours?
4) Manner of working: Will your business be run on a day-to-day basis or will there be some sort of team approach?
5. Get an EIN for your Texas LLC
An EIN is a number provided to your business by the IRS. It is necessary for any business that is required to report its taxes. The IRS provides an initial EIN if you are starting a new small business and need to get an EIN for your Texas LLC.
6. What Are the Tax and Regulatory Requirements?
The Internal Revenue Service (IRS) recognizes three types of LLCs: single-member, multi-member, and series LLCs. The IRS requires that all LLCs file an annual Form 1065 to report their earnings and losses to the IRS. But whether or not they file this form depends on their size and whether they are active in business during the calendar year.
An LLC is considered small if its gross income is $50,000 or less during any taxable year.
7. Should My LLC Be Member Managed or Manager Managed?
The organization of your LLC is a matter of personal preference. You can choose what suits you best, whether you want to be managed by members or managers.
Member management involves the daily operation of the business being left up to the individual members. This means that each member shares in the profits and losses of the company proportionately with other members. The LLC will have one or more officers, including a president and secretary who are responsible for carrying out all necessary administrative duties when it comes to running the business with day-to-day supervision from all members.
Manager management is where a single person makes decisions on behalf of all other members without their consent or approval. The LLC will have one or more officers, including a president and secretary who are responsible for carrying out all necessary administrative tasks.
8. How much does it cost to form an LLC?
The cost of forming an LLC varies from state to state and can be very expensive, costing thousands of dollars. If you’re planning to form an LLC for a business that’s going to be operating in several states, it’s generally cheaper to form a single-member LLC in the state where the business is going to be operating.
