What is a Texas Foreign Corporation?
If your corporation was formed in a different state, and you would like to expand your operations into Texas, you must register your corporation with the Texas Secretary of State. Your corporation is considered “foreign”–even though it may have just been formed in a state next door. Below you can find an in-depth how-to-guide on how to broaden your business horizons by registering your foreign corporation with the Texas Secretary of State.
Registering an Out-of-State Foreign Corporation in Texas
Corporations formed in another state that want to do business in Texas are referred to as a Texas Foreign Corporations. Any business entity actively engaged in business in Texas must register with the Secretary of State by filing a form called an Application for Registration. The Foreign Texas Corporation Application for Registration costs $750 to file, but, unlike most states, Texas does not require a Certificate of Good Standing from the state in which your business was initially incorporated.
If you have been operating a corporation for more than 90 days and have yet to file for an Application for Registration, you will also have to pay a late fee. The late fee is at the discretion of the Secretary of State, and can be equal to the registration fee ($750).
The Texas Application for Registration can be completed online through the Texas Secretary of State’s webportal, or via mail. The Texas Secretary of State typically requires 3 to 5 days to complete the filing. You are also required to to have a Texas registered agent, an individual or business that can accept service of process. We offer the best registered agent service in Texas for $50 a year. We can also register your corporation to do business in Texas for $100 plus the state filing fees outlined below.
A D.I.Y. Guide to Registering a Foreign Corporation
Check Entity Name Availability
The first step to registering your foreign corporation is to check and make sure that your desired corporation name is available. There are a few ways you can do this in Texas. You can call the Texas Secretary of State’s Business and Public Filings Clerk at (512) 463-5555. You can email the Secretary of State Clerks at firstname.lastname@example.org. Or you can use the Texas’ SOSdirect Web Portal to do a search for your the name of your corporation. This is the quickest method, however, it does cost $1 for each search.
Fill Out Your Texas Application For Registration
The Texas Application for Registration is form *304 on the Texas Secretary of States’ website. If you choose to file this document via mail, you must include two identical copies. If you use the SOSdirect Web Portal to file the Application for Registration, you will not only save on postage and paper costs, but you’ll also save a few days of overall processing time. There is, however, a 2.7% credit card processing fee that will bring your end total to $770.25.
To accurately complete the Texas Application for Registration, you will need to provide the following information:
— The name of your corporation
— Your corporation’s federal tax identification number
— The state and date in which your corporation was initially incorporated
— The principle address where you are planning on conducting business in Texas
— The name and address of your Texas registered agent (you are required to have one)
— The name and address of each person on your board of directors
— Your signature or e-signature, if you file online
Submit Your Documents and Wait For Processing
After you submit your documents to the Texas Secretary of State, you will have to wait a few days while they are processed. If you e-file, your documents should be processed within 1-2 business days. If you filed through mail, you should received the approved Application for Registration documents back in the mail within 5-10 business days. If your filing is denied for any reason, the documents will be mailed back to your with an explanation from the Texas Secretary of State.
If you file via mail, the Application for Registration (along with a copy) should be mailed to:
Secretary of State
P.O. Box 13697
Austin TX 78711-3697
If you file via fax, the Application for Registration (along with a copy) should be sent to:
Business Licensing, Sales Tax Permits, and Franchise Taxes
After your Texas Foreign Corporation is set up, the Texas Secretary of State makes it easy to get the licensing you may need for your corporation. Most business licenses, as well as the permit required for collecting sales tax, can be filed for online. Obtaining required business licenses and being prepared for your initial franchise tax report are good tasks to complete if you want to be prepared to maintain and manage your Texas Foreign Corporation.
Texas Franchise Tax
In lieu of a state corporate tax or an annual report, Texas applies a franchise tax to all for-profit business entities. Generally speaking, unless your corporation grosses over $1,130,000 in revenue, you will not have any annual franchise taxes due. If your corporation grosses over that threshold, your overall tax due is based on numerous factors such as the nature of your business and your Texas Foreign Corporation’s overall revenue. More information on the annual franchise tax can be found at the Texas Comptroller’s website.
The need for a business license to operate in the State of Texas is dependent on the location and nature of your foreign corporation in Texas. If you provide goods or services to customers, you will more than likely need a business license, and you will need to check with the municipal government of the city that your Texas Foreign Corporation is based in. After your Texas Foreign Corporation is formed you can easily discern whether you need to apply for a Texas Business License from the Texas state website.
Sales Tax Permit
If your foreign Texas corporation leases, sells/rents tangible personal property, or renders services to customers, you will need to get a sales tax license. A permit for withholding sales tax is obtained from the Texas Comptroller of Public Accounts website and your Texas foreign corporation’s file number will be needed to get it, so make sure to have your approved Application for Registration handy. You should allow 2-3 weeks for your permit to arrive, and, if your Texas foreign corporation has a dedicated retail space, it should be posted there at all times.
With us, Texas Foreign Corporation registration couldn’t be easier!
Here at Lone Star Registered Agent, we take pride in helping our customers achieve business success. We’re a proud Texas business and we know the thrill and reward of working hard to thrive.
The best part of it is that whether you’re expanding into Texas from Yukon, Oklahoma or the Yukon Territory of Canada, we’re here to provide your foreign incorporation and registered agent services. In fact, our office is just a ten minute walk from the Texas Secretary of State.
If you’re ready to register your corporation in Texas, let us make your job easier with fast service, fair prices, and the best customer service in the country. Hire us as your registered agent and you’ll be happier than a hog in mud.