Texas is a comparatively straightforward place to start a business, and there are still specific registrations and ongoing filings that come with it. Here is the practical checklist.
1. Decide the structure
Sole proprietorship, partnership, LLC or corporation. The choice affects liability, taxation and administrative burden differently, and it is worth deciding deliberately rather than defaulting.
A sole proprietorship requires no formation filing. Anything else is formed through the Texas Secretary of State with a filing fee and ongoing obligations attached.
2. Register the name
If you operate under a name other than your legal name or your entity's registered name, an assumed name filing — commonly called a DBA — is generally required, filed at the county level and in some circumstances with the state.
Parker County handles assumed name filings for businesses operating here. It is a modest filing and it is one of the more commonly skipped steps.
3. Get an EIN
An Employer Identification Number is obtained from the IRS at no cost. You generally need one if you have employees, operate as a partnership or corporation, or in various other circumstances.
Even where not strictly required, many sole proprietors obtain one so they can provide an EIN rather than their Social Security number to clients and vendors. That is a small but real privacy benefit.
Apply directly through the IRS. Third parties charging a fee to obtain an EIN are charging for something that is free.
4. Sales and use tax permit
If you sell taxable goods or provide taxable services in Texas, you generally need a sales and use tax permit from the Texas Comptroller, and you take on responsibility for collecting, reporting and remitting the tax on a filing schedule.
Two points that catch people. Some services are taxable in Texas and business owners frequently assume services are not. And sales tax collected is not your money — it is collected on behalf of the state, and remitting it on schedule matters.
5. Franchise tax
Texas imposes a franchise tax on taxable entities. There are thresholds below which no tax is due, and reporting obligations can apply even where no tax is owed.
The thresholds, rates and reporting requirements are set by the state and have been adjusted, so confirm the current position rather than relying on remembered figures. The point to internalize is that an entity generally has an annual obligation to address, separate from federal filing.
6. Employer registrations, if you hire
Hiring brings its own set: registering with the Texas Workforce Commission for unemployment tax, federal employment tax obligations including withholding and deposits, new hire reporting, and workers compensation considerations, which Texas handles differently from most states.
This is the step where using a payroll service is the practical recommendation for almost every small business.
7. Local requirements
City and county requirements vary. Depending on your business and location, that can include local permits, zoning compliance, health permits for food-related businesses, and occupational licensing for regulated professions.
For a business operating in Weatherford or elsewhere in Parker County, checking with the city and county directly is the reliable route.
8. Set up the financial infrastructure
- A business bank account, separate from personal, from the first transaction
- A business card for business spending
- Bookkeeping established before the transactions pile up
- A system for setting aside tax, since nobody is withholding for you
- Insurance appropriate to the business
The separate account is the one that pays for itself immediately, in cleaner records and captured deductions.
The ongoing calendar
New business owners are frequently surprised by how much of compliance is recurring rather than one-time: franchise tax reporting, sales tax filings on your assigned schedule, quarterly estimated payments, payroll deposits and filings if you have employees, and annual federal returns.
Building that calendar at the start is considerably easier than reconstructing missed obligations later.
Where we fit
RD Precision Tax Service works with new and established small businesses across Weatherford and Parker County. The tax side of setup — entity considerations, EIN, estimated payments and the compliance calendar — is worth getting right at the beginning, and the legal formation questions are worth discussing with an attorney alongside it.
This article is general information, not tax advice, and tax rules change from year to year. Confirm current-year figures and talk with a professional about your specific situation before acting.
Common questions
Do I need an LLC to start a business in Texas?
No. A sole proprietorship requires no formation filing and is a legitimate structure. The reasons to form an entity are liability separation and, in some industries, client expectations. The tax implications depend on the structure and any elections made, and the liability question is worth discussing with an attorney.
Does it cost money to get an EIN?
No. An EIN is obtained from the IRS at no cost. Third-party services charging a fee to obtain one are charging for something free.
Do I need a Texas sales tax permit?
If you sell taxable goods or provide taxable services in Texas, generally yes, along with the obligation to collect, report and remit. Note that some services are taxable in Texas, which surprises business owners who assume services are exempt.
Does my small business owe Texas franchise tax?
There are thresholds below which no tax is due, and reporting obligations can still apply even where no tax is owed. Thresholds and requirements are set by the state and have been adjusted, so confirm the current position. The key point is that an entity generally has an annual obligation to address.
Have a question about your situation?
Robert prepares returns for individuals, contractors, and small business owners across Weatherford, Aledo, Willow Park, Springtown, Mineral Wells, and the rest of Parker County. Bring your questions — the first conversation is free.