Start Your Business with a Houston LLC Formation Lawyer
One of the most important decisions to make when forming a new business is deciding on the right type of business entity.
Once you’ve determined your entity type, an experienced business formation lawyer helps with the next important steps.
Depending on your entity, the success of your business depends on the creation of bylaws, an operating agreement, or a company agreement. Having clear written agreements is crucial to ensuring your business runs smoothly.
An experienced Houston LLC attorney near you can help navigate the Texas Business Organizations Code for successful business formation.
What Business Entity is Right for Me?
Businesses in Texas can take on various forms, and each form has different strengths.
Sole Proprietorship
One of the main advantages of a sole proprietorship is the ease of set-up and low start-up costs. Sole proprietorships are ideal for simple businesses. However, the individual owner is financially responsible for all the debts and liabilities of the business.
Sole proprietorships are common and do not require formal paperwork filing. If your business is not your legal name, a DBA or “doing business as” must be filed in your county.
You may also need a business license for your sole proprietorship.
Partnerships and Limited Partnerships
A general partnership is the most common type of partnership. This is a simple agreement between two parties to form a business. Each partner shares equally in the profits and losses of the partnership.
General partnerships are treated precisely as sole proprietorships. Financial responsibility for the debts and liabilities of the business belongs equally to each partner.
A limited partnership in Texas includes general partners and limited partners. General partners share equally in the profits and losses of the partnership. Liability for any debts of limited partners never extends beyond the initial investment in the partnership.
A limited liability partnership affords partners more liability protection than a typical general partnership. Liability for debts of limited liability partners never extends beyond their initial investment. Filing regulations in Texas exist for LLPs and require:
- That the business have “LLP” in its name,
- That each partner pay a $200 filing fee, and
- That the LLP maintains at least $100,000 in insurance at all times.
Partnerships offer many advantages suitable for many business models.
Limited Liability Company
A limited liability company is a unique entity. LLCs share features of partnerships and corporations. Like a limited partnership, liability of members is limited to their initial investment. Members enjoy the same pass-through tax treatment of partnerships and S-corporations.
Texas law outlines specific set-up requirements for LLCs. You must file Articles of Organization with the Texas Secretary of State. The Articles of Organization provide information about business operations.
A PLLC, or professional limited liability company, is a specific LLC formed by a subset of professions identified in the Texas Business Professions Code.
Corporations and S-Corporations
For a Texas corporation, you must file a certification of formation with the Texas Secretary of State. Corporation benefits include limited personal liability, the continued existence despite death of owners, and tax advantages.
A qualified business formation attorney identifies objectives and liabilities to pick the best structure for your needs and goals.
Why Set Up an LLC in Texas?
The advantages of LLC are best suited for businesses seeking the formality of a corporation with the flexibility of a partnership. Similar to corporations, Articles of Organization must be filed with the Secretary of State. Registration costs for an LLC in Texas are $300 with no annual registration fee.
In contrast to a corporation, there is no requirement to hold annual meetings or keep detailed minutes. Additionally, no limitations exist for the number of members in an LLC in Texas.
Do I Need a Houston LLC Attorney?
Regardless of the entity structure you choose, an experienced Texas business formation lawyer near you can help:
- Generate the appropriate paperwork to file,
- Lay the initial groundwork for how your new entity will operate, and
- Identify licensing or regulatory issues you need to be aware of for your industry or business.
The Curley Law Firm has experience helping both large and small companies get off the ground with comprehensive legal advice on the advantages and disadvantages of different business entities.
Adam Curley helps businesses ensure they begin on a solid foundation. In his ten years in business, Adam Curley has worked tirelessly with his clients to resolve various complex business matters.
The Curley Law Firm has dedicated much of its focus to business law and understands what it takes to form the right organization for your needs. Contact the Houston LLC lawyers at The Curley Law Firm today with your business formation questions and find out how we can help you and your business.