Texas C Corporation Formation

A Texas C Corporation will be filed with the Texas Secretary of State. This page provides an overview of the steps required to file a new C Corporation in Texas.

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Steps to Forming a Texas C Corporation

To form a C corporation in Texas, you must draft and submit Articles of Incorporation to the Division of Corporations of the Secretary of State. The following information must be included in Texas Articles of Incorporation:

  • The name of your C Corp: In addition to requiring that corporate ending or its abbreviation be present at the end of your name, Texas has a strict policy on name availability. As in other states, your name must not be the same as another name already on file—regardless of the corporate ending following the name. However, Texas takes this one step further by imposing a two-word rule: with few exceptions, you will only allowed to file a name for which the first two words match the first two words of an existing entity if you obtain a letter of consent from that entity. For example, if there is currently a Happy Kitchen Bakery, LLC on file, you would be required to ask them for permission before using Happy Kitchen Appliance Delivery, Inc.—despite the fact that the entity types are different, and despite the fact that the services are likely very different.
    If you're not sure if your name is different enough from an existing business, ClickandInc.com can perform a business name search to determine the availability of your name.
  • Registered Agent: You must provide the name and physical address of the person who will act as the contact for the business. This is the person (or outside organization) who should be available to accept service of process. The registered agent must accept the position; you may either attach the signed acceptance to your Articles of Incorporation, or you may keep the acceptance in your own records—but if you do so, you must be able to produce it if requested.
  • Directors: You will list the name and address of each of the initial board of directors (there must be at least one). The directors listed will serve until the first annual meeting of shareholders, or until successors are elected.
  • Shares: The amount of shares your corporation is authorized to issue will be listed here; you must authorize at least one share. Your shares will either have a specified par value or be without par value. If multiple classes of stock are authorized, those classes must be detailed.
  • Purpose: Most businesses are formed for the default general purpose, which includes any and all lawful business allowed under the Texas Business Organizations Code. However, it is best to check with a legal advisor if you think you may need to provide a more specific purpose for any type of future dealings or applications.
  • Texas Articles of Incorporation allow for additional provisions, if any, to be added.
  • Effectiveness of Filing: If no later filing date is requested, the document will be effective upon filing.
  • Organizer: The person who drafted the Articles will provide their name, address, and electronic signature (or original signature, if paper forms are used).

If any of the above information about your business changes, you will need to file a Certificate of Amendment to reflect those changes (or include those changes in your Biennial Statement). It is very important that your registration remains current.

ClickAndInc can set up your Texas corporation for you quickly and affordably. Or, reference our sample Texas Articles of Incorporation for assistance.

Further Responsibilities of a Texas C Corporation

When you incorporate in Texas, you must follow up with timely Annual Report filings. Texas allows their annual reports to be completed and submitted electronically (as well as most other business filings).

Additional Information about Texas C Corporations

Your C Corporation:

  • Can sell stock and raise capital
  • May deduct the cost of benefits provided to employers (such as parking permits, health insurance, and so on)
  • Has a board of directors, which oversees the policies of the corporation
  • Issues limited liability for owners
  • Can be owned by non-US citizens or non-resident aliens
  • Can own other business entities
  • Can be owned by other business entities
  • Is taxed separately from the owners' income

Shareholders of a C Corporation cannot be held liable in a judgment against the corporation for an amount greater than the amount of stock they hold. (This does not include any personal liabilities, such as fraud, failure to pay taxes, and so on.)

Other Types of Businesses in Texas

For information on other types of businesses in Texas, please explore the links below.

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