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Insights For Texas Entrepreneurs
When forming a limited liability company (LLC) in Texas, one of the most important legal documents you’ll need are the articles of incorporation — also commonly referred to as the certificate of formation or articles of organization. They are filed with the Texas Secretary of State.
This filing establishes your LLC with the state and lays out key provisions governing its operations. Turn to Dan Burke Attorney At Law for assistance filing your articles of incorporation.
What Are Articles Of Incorporation?
Articles of incorporation outline foundational information about your new business entity. Note that different states use different terminology — Texas refers to this filing as the “certificate of formation” while others call it “articles of organization.”
Regardless of the name, this document serves as the official charter establishing your LLC’s existence. For Texas LLCs, the articles must include:
- • The name of the LLC
- • Whether it will be member-managed or manager-managed
- • The name and address of each member (member-managed) or manager (manager-managed)
- • The name and Texas address of the registered agent
- • The name and address of the organizer filing the certificate
Accurately completing and filing the articles of incorporation is crucial for officially forming your LLC in accordance with Texas state laws. Even minor omissions or mistakes can derail your LLC application, so it’s wise to have an attorney review before submitting.
Member-Managed vs. Manager-Managed Structure
One of the key decisions when forming a Texas LLC is whether it will be member-managed or manager-managed. This determines how the company is controlled and who has authority over daily operations and binding decisions.
In a member-managed LLC, all owners (members) have an active role in the management and operations of the business. Each member acts as an agent of the LLC, with the ability to make decisions and enter into transactions that legally bind the company. There is no real separation between the members and those running the LLC.
Alternatively, a manager-managed LLC structure separates the members from the management authority. One or more designated managers, who may or may not be members themselves, are appointed and granted the exclusive right to handle operational decisions and day-to-day management responsibilities for the LLC. The members maintain an ownership interest but do not directly manage the business.
This division of roles allows members in a manager-managed LLC to have a more passive investment role if desired. The managers run the company based on the operating agreement’s terms, while members receive distributions of profit but do not necessarily work in the business.
The member-managed vs. manager-managed decision impacts everything from how the LLC is taxed to potential liabilities and legal exposure of the members. It shapes the fundamental structure, so choosing the right model aligned with the LLC’s goals is crucial when establishing the articles of incorporation.
Registered Agent Requirement
Texas requires all LLCs to maintain a registered agent and provide their name and in-state address in the articles. This agent receives official documentation like legal summons on the LLC’s behalf.
Public Record
Once filed, your articles of incorporation become public record, making the included information visible to anyone searching LLC databases.
Using Articles Of Incorporation Templates
To ensure your articles of incorporation are completed properly, many businesses opt to use a template or online incorporation service. However, have an experienced business attorney review the document before submission. They can catch issues and omissions that could violate Texas LLC laws.
Trust Dan Burke Law
By thoroughly understanding articles of incorporation requirements, you can ensure your new Texas LLC meets all legal formalities from the start. For assistance drafting and filing these articles, consult a qualified Texas business lawyer like Dan Burke. With help from an experienced attorney, you can focus on launching your new venture knowing the details are being handled correctly.