Using Texas Corporation and Partnership Law

Form a business with Texas corporate law

Making a new corporation is one of the most common reasons for using Texas corporation and partnership law. A small business may prefer to file the documentation needed to incorporate a business directly with the state. There are also many companies that provide business formation services for a fee.

The most important factor in incorporating in Texas is choosing a specific business structure. Texas partnership law makes some important distinctions between a corporation and a partnership. A partnership generally does not pay a business tax although the partners are liable for business debts.

Corporate law defines the way in which the following entities interact:

1. Shareholders that collectively own companies in Texas. Shareholders may hold special privileges such electing a board of directors, proposing resolutions and sharing in the company’s income.

2. Directors that oversee the company’s activities. The activities of the board of directors are typically determined by the company’s bylaws. The board of directors and the shareholders are typically the same group of people in a small business.

3. Employees that provide expertise and perform labor for the company. Employees are also shareholders in many cases.

Select the best structure for your business according to Texas corporation laws

Your choice of business types can include corporations, full partnerships and limited partnerships. There are many sites that summarize business laws in Texas and you may also need an attorney to explain these laws to you.

Use a company to create a business under Texas corporation and partnership law

There many online services that can submit the required forms on your behalf in exchange for a fee. However, you will still need to comply with the disclosure, operating and reporting requirements.

Create a new business by yourself with Texas corporation laws

Each state has a department that is responsible for the formation of new businesses. You can complete these forms yourself and submit them directly to the correct government department.
Texas State College of Business Administration provides specific resources for incorporating a business in Texas.

• You will need to select a name before you create a Texas company. Many online services provide a name search function to determine if a particular name has been used before. The required forms will also provide spaces for more than one business name in many cases. This increases the chances that an unused name can be found.

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