How to Form C-Corp in Texas

Quick Answer

To form a C-Corporation in Texas, you’ll need to file a Certificate of Formation with the Texas Secretary of State for a $300 filing fee. As of April 2026, processing takes 5-7 business days for standard filing or 2-3 days for expedited service. Texas requires a registered agent and offers significant tax advantages with no state income tax and no franchise tax for corporations with revenue under $2.47 million.

Step-by-Step Formation Process

1. Choose Your Corporate Name: Verify name availability through the Texas Secretary of State’s online database at sos.state.tx.us/corp/. Your name must include “Corporation,” “Corp.,” “Incorporated,” or “Inc.”

2. Appoint a Registered Agent: Select someone who maintains a Texas address and is available during business hours to receive legal documents.

3. Prepare Certificate of Formation: Complete Form 201 (Certificate of Formation - For-Profit Corporation) available on the Texas Secretary of State website.

4. File with the State: Submit your Certificate of Formation online through SOSDirect or mail it to:

   • Texas Secretary of State
   • Corporations Section
   • P.O. Box 13697
   • Austin, TX 78711-3697

5. Pay Filing Fee: The state filing fee is $300 as of April 2026.

6. Obtain Federal EIN: Apply for an Employer Identification Number through the IRS website or by phone.

7. Create Corporate Bylaws: Draft internal governance documents outlining how your corporation will operate.

8. Hold Initial Board Meeting: Conduct your first board meeting to adopt bylaws, issue stock, and handle other organizational matters.

Costs Breakdown

Fee Type	Amount	Notes
Certificate of Formation	$300	Required state filing fee
Expedited Processing	Contact SOS	2-3 day processing available
Name Reservation	Contact SOS	Optional, if needed before filing
Registered Agent Service	$100-300/year	If using professional service
Federal EIN	Free	Apply directly with IRS

Fees current as of April 10, 2026. Contact the Texas Secretary of State for the most current fee schedule.

Requirements Checklist

Before filing your Certificate of Formation, ensure you have:

• Unique corporate name ending with appropriate designator
• Texas registered agent with physical address
• Incorporator information (person filing the documents)
• Number of authorized shares and par value
• Initial directors’ names and addresses
• Corporate purpose statement
• $300 filing fee payment method

Tax Implications

Texas offers exceptional tax advantages for C-Corporations:

State Taxes: Texas imposes no state income tax on corporations, making it highly attractive for business formation.

Franchise Tax: Texas levies a franchise tax (also called the “margin tax”) on corporations, but only those with revenue exceeding $2.47 million annually. Companies below this threshold owe no franchise tax, though they must still file the annual Franchise Tax Report.

Federal Taxes: C-Corporations face double taxation at the federal level - the corporation pays corporate income tax on profits, and shareholders pay personal income tax on dividends.

Sales Tax: Texas has a base sales tax rate of 6.25%, with local jurisdictions potentially adding additional amounts.

Ongoing Obligations

Annual Franchise Tax Report: Due May 15th each year, even if no tax is owed. Late filing incurs penalties.

Federal Tax Returns: File Form 1120 (U.S. Corporation Income Tax Return) annually by the 15th day of the 4th month after your tax year ends.

Corporate Records: Maintain corporate books, records, and meeting minutes as required by Texas Business Organizations Code.

Registered Agent: Maintain a registered agent with a Texas address at all times.

Good Standing: Keep your corporation in good standing by filing required reports and paying applicable taxes on time.

Registered Agent

Texas law requires every corporation to maintain a registered agent with a physical Texas address (not a P.O. Box). The registered agent must be:

• An individual who resides in Texas, or
• A domestic or foreign entity authorized to transact business in Texas

Registered Agent Duties:

• Accept service of legal documents
• Receive official state correspondence
• Forward important documents to the corporation
• Maintain regular business hours at the registered address

You can serve as your own registered agent if you have a Texas address, or hire a professional registered agent service for $100-300 annually.

Common Mistakes to Avoid

1. Choosing an Unavailable Name: Always verify name availability before filing. Similar names to existing entities may be rejected.

2. Incorrect Registered Agent Information: Ensure your registered agent has a valid Texas physical address and has consented to serve.

3. Missing Required Designators: Your corporate name must include “Corporation,” “Corp.,” “Incorporated,” or “Inc.”

4. Incomplete Certificate of Formation: Missing information will delay processing or result in rejection.

5. Forgetting the EIN: You’ll need a federal Employer Identification Number for banking and tax purposes.

6. Skipping Corporate Formalities: Failure to maintain proper corporate records and hold required meetings can jeopardize limited liability protection.

7. Missing Annual Filings: Even if you owe no franchise tax, you must file the annual Franchise Tax Report by May 15th.

Related Guides

• How to Form C-Corp in Ohio: 2026 Step-by-Step Guide ($99 Fee)
• How to Form C-Corp in Alabama: 2026 Step-by-Step Guide
• How to Form C-Corp in Alaska: 2026 Step-by-Step Guide
• How to Form C-Corp in Arizona: 2026 Step-by-Step Guide
• How to Form C-Corp in California: 2026 Step-by-Step Guide

FAQ

How long does it take to form a C-Corporation in Texas?

Standard processing takes 5-7 business days when filing online, or 2-3 days for expedited service. Mail filings typically take longer. The Texas Secretary of State offers expedited processing for an additional fee.

Do I need an attorney to form a C-Corporation in Texas?

While not legally required, consulting an attorney is recommended for complex situations. The Certificate of Formation can be filed directly with the state, but professional guidance helps ensure compliance and proper structure.

Can I be my own registered agent?

Yes, if you have a physical Texas address and are available during business hours to receive legal documents. Many business owners prefer professional registered agent services for privacy and reliability.

What’s the difference between authorized and issued shares?

Authorized shares are the maximum number your corporation can issue as specified in the Certificate of Formation. Issued shares are those actually distributed to shareholders. You can authorize more shares than you initially plan to issue.

When do I need to start paying franchise tax?

Texas franchise tax only applies to corporations with total revenue exceeding $2.47 million annually. Below this threshold, you file the annual report but owe no tax. This makes Texas particularly attractive for small to medium businesses.

Can I change my corporate name after formation?

Yes, by filing a Certificate of Amendment with the Texas Secretary of State. You’ll need to verify the new name is available and pay the required amendment fee.

What happens if I don’t file the annual Franchise Tax Report?

Failure to file results in penalties and eventual forfeiture of your corporate charter. Even if you owe no tax, you must file the report annually by May 15th to maintain good standing.

How do I dissolve a Texas C-Corporation?

File a Certificate of Termination with the Texas Secretary of State after settling all debts, distributing assets, and obtaining necessary tax clearances. The corporation must also file final tax returns with both state and federal authorities.

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This information is for educational purposes only and should not be considered legal or tax advice. Consult with qualified professionals for guidance specific to your situation. Data current as of April 10, 2026.