For the entrepreneur looking to start a business in Texas, there are a number of permits and licenses you must acquire before you can get your business up and running. Texas doesn’t have an official “business license”, however, the state does have strict requirements about the licenses you must have in order to provide certain services and products. Keep in mind that when it comes to paying federal and state taxes, it is your job to know what to pay and when. Failure to pay business taxes on time can result in steep penalties.
One of the first things you will need to do is incorporate your business. Choose from a number of business models including sole proprietorship, general partnership, corporation, limited liability company (LLC), limited liability partnership (LLP), limited partnership and association. LLPs may be reserved for certain types of professionals. An LLC is a unique entity that offers a number of tax advantages. You can review the details online at www.texasonline.com. If you elect to file an LLC, you can download and fill out Form 205 HERE. The fee for forming and LLC is $300. You will need to include this with your application. Mail both to P.O. Box 13697, Austin, TX, 78711-3697.
Get Your Federal Tax ID Number
You will also need a Federal Tax ID Number. You can apply online in minutes at IRS.gov. Apply HERE.
Get Your Texas Sales Tax Permit
You will also need to get a Texas sales tax permit. Download a Form AP-201 HERE. Fill it out and take it to your local comptroller’s office, or mail it to the main office. Keep in mind that it can take up to 4 weeks to get your permit. For questions on how to fill out your application, call 512-463-4600.
Sign Up for SUTA
If you have at least one employee, you will likely be required to pay federal and state unemployment taxes, known as FUTA and SUTA. As soon as your business is established, you must register with the Texas Workforce Commission (TWC). Click HERE to determine if you are required to pay SUTA. While there, review the Texas employment laws. For additional information, call 512-463-2747. For information on FUTA, refer to the IRS Instructions for Form 940 HERE.
Review Necessary Texas Permits and Licenses
Depending on the types of products and services you sell, you may be required to obtain additional permits and licenses. Click HERE for a list of licenses and permits.