The State of Texas LLC
by: Jackson Mayer on Thu, 12 Mar 2009 at: 6:34 PM Go to: Previous Article Next Article
In 2007, almost 70,000 Limited Liability Corporations (LLCs) formed in the state of Texas. LLC growth in recent years has been fairly strong throughout the United States, but the growth in Texas LLCs has been outpacing most of the other states substantially.
Now, Texas is a large state and a popular one for entrepreneurship. But, the lawmakers in TX have also focused on consistently improving the Texas business organizations laws each year to ensure that the limited liability company remain simple enough yet flexible enough for any small business.
TEXAS STATUTES ARE FAVORABLE IN TERMS OF ASSET PROTECTION FOR THE LLC BUSINESS PERSON.
The main reason you should use a Texas LLC is for the personal asset protection it affords. Texas BOC law, Section 101.114, exempts a member or manger from the debts, liabilities or obligations of the limited liability company, unless otherwise stated in the LLC's company agreement.
Sole proprietorships do not offer this same protection, making them risky. Without LLC protection, you place your assets and yourself at enormous financial risk. While the rewards of entrepreneurship can be great, the financial risks are also high.
By using a State of Texas LLC, you manage that risk effectively and protect yourself from financial liability risks.
STATE OF TEXAS LLC REQUIRES ONLY ONE MEMBER TO FORM
Section 101 of the Texas Business Organizations Code confirms that only one member is required to start an LLC. There are no limits or caps on the number of members so this entity can handle everything from the solo owned business to the large complex business with hundreds of owners.
TEXAS LIMITED LIABILITY COMPANIES ALLOWED
Texas laws, specifically Sections 1-5 of the Texas statutes are unique in that they recognize several types of businesses specifically. One of these is the basic, traditional domestic LLC, the most common form of business incorporation for standard small business.
In any case, you can also choose a Professional company, which is frequently used by lawyers and medical professionals. Texas even offers an option for non-profit or charitable firms.
SUMMARY
The enormous growth in limited liability company formation in Texas gives testament to the clear benefits this unique legal entity can provide. Given the low cost of formation and the massive financial protection benefits a State of Texas LLC provides, this vehicle will continue to be a primary choice over other options for starting a business in Texas.
About the Author
For a Free Guide about the State of Texas LLC or a Free Texas Name Search, visit Texas Business Formation, provider of the 3 Day LLC Formation Service: http://www.TexasBusinessFormation.com
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