If you’re wondering how to incorporate in Texas, there are procedures you must do in order to get corporation status in the state of Texas.
If you’re wondering how to incorporate in Texas, there are a few procedures you must do in order for your firm to be granted corporation status in the state of Texas. These include deciding on a business structure, selecting a name, determining who will administer the company, submitting a certificate of incorporation, and getting an EIN.
Corporation Types
There are three possibilities for forming a corporation in Texas. You may incorporate yourself as:
A for-profit organisation.
A non-profit organisation.
A company from another country.
Steps Required for Texas Incorporation
The first step in incorporating in Texas is to choose the company structure that best meets your requirements and objectives. Because it is a difficult undertaking, the following measures should be considered while making a decision:
Consult an attorney about the situation. Because this is a complicated topic, consulting with a lawyer can help you clarify your corporation’s expectations and the way you want it to be operated. Recommendations are the greatest method to discover a quality attorney. If that isn’t an option, checking the state bar association database should assist you identify the suitable individual for the position.
Make a choice on how you want your company to operate. Before beginning the incorporation process, you should examine factors like how engaged shareholders should be in corporate decisions and whether the emerging organisation will be for-profit or non-profit, among other critical concerns.
Choose where you wish to incorporate your company. To do business in Texas, a firm does not need to be formed. You may incorporate in any state, and your new company will be governed by the laws of that state. If you do not register in Texas but want to conduct business there, you must register as a foreign company.
Determine how the company will handle earnings. Earnings from a for-profit firm are distributed to shareholders or workers as dividends or bonuses, while profits from a nonprofit organisation are used for reinvestment or charitable activities.
Forming a Non-Profit Corporation
The first step in forming a for-profit company is to name it, since Texas law requires all corporations to have a business name. The name should then be registered with the Patent and Trademark Office to prevent others from using it. One of these terms must be included in the name.
Corporation.
Company.
Limited.
Incorporated.
The name must also not be too similar to existing firms registered in Texas.
Following that, you must designate the persons who will be in charge of operating the company, since the state requires all corporations to have one or more directors. The designation of a registered agent, who may be either a human or an organisation, is also necessary. The registered agent is responsible for processing any official notifications issued to the corporation.
After that, you must submit a certificate of incorporation, which explicitly states the corporation’s purpose, value, name, and who is in charge. Once completed, the paperwork must be physically filed or mailed to the secretary of state, along with a $300 filing fee.
Although not required by the state, each business should have well written bylaws that outline the company’s policies and processes as well as who is in responsibility of enforcing them.
The next step is to apply for an Employer Identification Number, commonly known as a federal tax identification number, which will be used to identify the business for tax reasons. Following that, the corporation is ready to do business as long as it maintains thorough corporate records and pays franchise, state, and federal taxes.
Organizing a Nonprofit or a Foreign Corporation
The methods for forming a nonprofit organisation are similar to those for forming a for-profit corporation, with a few exceptions. The purpose indicated in the Certificate of Formation will be charitable, and a tax exemption application must be submitted with the Internal Revenue Service to exempt the firm from taxes that for-profit companies are required to pay.
If you want to register your company in another state yet conduct business in Texas, you must do it as a foreign corporation. Filling out a form detailing the nature, purpose, and management structure of your organisation is required for registration. This document, together with a $750 fee, must be submitted with the Secretary of State.