Starting a business can be one of the most significant decisions you ever make and the legal process can seem daunting. Each state has different laws and regulations regarding the formation of small business and having an understanding of them before you get started will make things easier for you as you go about the process of forming your small business in the state of Texas.
Before you can register your newly formed business, you must decide how your business will be formed. There are many different types and each has its advantages and disadvantages in different circumstances. The different types of business structures include,
· Sole proprietorship
· Limited Liability Company
· Corporation (C corporation and S corporation)
Because each structure is different, they are treated differently under the law. They all have requirements specific to their type and they can be somewhat confusing if you are unfamiliar with them, but the United States Small Business Administration (SBA) has guides that provide information and assistance should you need it.
In order to legally conduct business in Texas you will need to register your business with the Texas Secretary of State. This registration includes filing for a name for your business, known as a name certificate or D.B.A. (doing business as). Under the law, each corporation must operate under a different name, so research before registering to ensure that you are not infringing on another company’s trademarks. Verifying this beforehand will save considerable time and effort on your part rather than dealing with it after your business has opened and begun operating.
You must also address any necessary permits, licenses, and relevant tax information. This includes requesting an Employer Identification Number and sales tax permits. Texas does not require a general business license, but there are local city and county agencies that have specific regulations regarding any licenses or permits you may need to operate in the area. It is always advisable to stop by any local government offices as you go about this process to see if there are any additional steps you must take.
There are many logistical concerns when starting your own business and the process may be made easier if done with the assistance of a legal professional who is familiar with the requirements and regulations. The U.S. Small Business Administration has also compiled many resources that may be helpful in answering any questions you may have along the way. Any information you cannot find should be looked for with local agencies.