A Texas certificate of good standing confirms that a limited liability company (LLC) or corporation was founded lawfully and is being properly maintained.
In our Certificate of Good Standing Texas tutorial, we will go over the qualifications for good standing as well as how to get one in Texas.
How Do I Obtain a Texas Certificate of Good Standing?
Request your certificate of good standing, also known as a certificate of fact – status in Texas, from the Secretary of State.
There are two major processes involved in obtaining your certificate of good standing:
1. Maintain your LLC’s compliance
2. Request a certificate of good standing.
What exactly is a good standing certificate? A certificate of good standing is a state document that confirms your company was created lawfully and has been properly maintained.
Step 1: Ensure that your Texas business is in compliance.
To qualify for a Texas certificate of fact – status, your company must meet the following state compliance requirements:
Permits and Licenses
To run a company in Texas, you must adhere to federal, state, and municipal licensing requirements. Regulations such as health permits and construction permits are examples of this.
The State of Texas website has further information on state licensing requirements.
Depending on your company activity, you may be required to register for several types of Texas state tax. This includes sales tax as well as Unemployment Insurance (UI) tax. There is no state withholding tax in Texas.
In addition, Texas LLCs and corporations must pay a franchise tax in addition to filing an annual report.
Reports on a Year
All Texas LLCs and corporations are required to submit an annual report in addition to their franchise tax. This report outlines your company’s tax statistics for the previous year.
Every year, the report is submitted electronically with the Texas Comptroller of Public Accounts. It must be submitted by May 15.
Businesses having annually income of less than $1,130,000 must submit a “No Tax Due” report but do not pay any tax. Businesses having annually sales of more than $1,130,000 are subject to a progressive tax computed using a sophisticated methodology.
Step 2: Obtain a Texas Certificate of Good Standing.
Once your company is in compliance with the state, you may apply to the Secretary of State for a Texas certificate of fact – status. This may be done by the mail, email, or phone.
Is a Certificate of Good Standing Required in Texas?
While you don’t always need a certificate of fact – status to run a business in Texas, there are a few times when you might. These are some examples:
Purchasing commercial insurance
Applying for commercial loans
Setting up a business checking account
Getting a business license in another state