Limited Liability Company

 

Texas has one of the most comprehensive laws when it comes to business organizations. The Texas Limited Liability Company is the state's most popular legal entity and it formed close to 70,000 of them in 2007.

A Texas Limited Liability Company can provide tax benefits and legal protection for the owners of the LLC. The most common Texas LLC is formed by small businesses, but Texas law allows four LLC types: domestic, professional, non-profit, and foreign.

DOMESTIC TEXAS LLC

This is the standard LLC and is the most popular type as it is used primarily for operating a small business or for joint ventures among business owners. It is extremely flexible and there are no limitations on what this kind of legal entity can do as long as it is a lawful purpose.

While it can have a perpetual life and be used for many reasons, it is important that your formation documents strictly comply with the Texas LLC requirements when creating one. So be sure you use a reputable LLC services provider to handle this.

CREATING A PROFESSIONAL TEXAS LLC

The Professional Texas LLC allows business owners to provide licensed professional services within the state. Business organizations with this particular LLC designation are limited to providing only those specific services for which the business, and its owners, is licensed.

CREATING A NON-PROFIT TEXAS LLC

If a Texas charity or other non-profit organization wishes, it can create a non-profit Texas limited liability company. A non-profit LLC has many of the same advantages of a non-profit corporation, but it is easier to create.

Social groups such as business associations also qualify to create a non-profit LLC. However, the LLC will not be a tax-exempt entity unless it also meets other Texas requirements. A specialist in creating Texas LLCs can guide you to making the tax elections, the choices that get you the proper tax status.

4. Foreign Limited Liability Company in the State of Texas

Businesses that are formed in another state but conduct business in the State of Texas are referred to as Foreign LLCs. There are Texas LLC laws that address how Foreign LLCs are to be regulated. The Texas Secretary of State is in charge of issuing certificates of authority for out-of-state operations to conduct business within the State of Texas.

A foreign LLC is subject to certain LLC laws in Texas but the formation and governance rules of the formation state still apply.

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