How to Form a Texas Foreign Corporation
What is a Texas Foreign Corporation?
In the United States, just because you are registered to do business in one state does not mean that you can legally do business in another state.
If you want to transact any serious business in a state other than the state in which your Corporation is registered, most likely you will
have to register with the state in which you want to do business before you can legally conduct business there.
For example, a Corporation that is registered in California wants to do business in Texas.
The California Corporation is a "Domestic" Corporation in California and will be a "Foreign" Corporation in Texas.
The California Foreign Corporation needs to register with the Texas Secretary of State as a Texas Foreign Corporation.
The use of the term Foreign in this case refers specifically to individual US states.
The US government, including the IRS, considers a Foreign Corporation to be a Corporation that is registered outside
of the United States.
What is a Texas Foreign Corporation Qualification?
You want to do business in the state of Texas but are registered as a "Domestic Corporation" in another state.
In order to legally conduct business in the state of Texas you must register with the Texas Secretary of State as
a
Foreign Corporation.
The process of registering as a Foreign Corporation in Texas is called
Texas Corporation Foreign Qualification.
The process of Texas Corporation Foreign Qualification is similar to the process of forming a Domestic Corporation in Texas.
Your original Domestic Corporation formation documents (usually called Articles of Incorporation) and By Laws apply to your Texas Foreign Corporation.
The Officers and Directors of your Domestic Corporation have the same roles in the Texas Foreign Corporation.
Specific requirements to qualify as a Foreign Corporation in Texas are explained below.
Once you have made the decision to Qualify as a Foreign Corporation in Texas,
a Texas lawyer can file your documents and act as a middle man for a few hundred dollars an hour;
or you can use an online service provider like All Business Documents to perform these services.
Put the money you save with All Business Documents right where it belongs: into your new Texas Foreign Corporation.
Do I need a lawyer to Form a Foreign Corporation in Texas?
The short answer is no.
The state of Texas does not legally require a lawyer to form a
Texas Foreign Corporation.
Our detailed
Foreign Corporation Information page may help you understand some
of the implications of forming a
Texas Foreign Corporation.
However, if there is
anything about forming a Foreign Corporation in Texas
that you're not sure about you should seek the advice of a competent Texas lawyer, a Texas accountant,
or both
before you form a Foreign Corporation in Texas.
Once you have made the decision to form a Foreign Corporation in Texas, a Texas lawyer
can file your documents and act as a middle man for a few hundred dollars an hour; or you can use an online service provider like All Business Documents
to perform these services and
save money that you can use in your new Texas Foreign Corporation.
Do I have to Reserve a Company Name before I Form a Foreign Corporation in TX?
You are not legally required to reserve a Company Name for a new Texas Foreign Corporation before you submit your application to Form a Foreign Corporation
in Texas.
The Foreign Corporation name that you have registered in your home state may or may not be available in Texas.
In that case you need a different name your Texas Foreign Corporation.
Whether or not you need to reserve a company name for your new Texas Foreign Corporation depends entirely on your business situation.
The Texas Secretary of State uses names on a first come first served basis.
So if you think that someone may snatch the Company Name that you have in mind, you may want to reserve that Texas Foreign Corporation Name.
What if the Texas Foreign Corporation Name I want is already taken?
If the Name you have chosen for your new Texas Foreign Corporation is already in use by a currently active
Texas Foreign Corporation or LLC then you will have to register a DBA Name with the Texas Secretary of State. "DBA" is an abbreviation for "
Doing
Business
As."
In Texas a DBA Name is called a Assumed Name.
We verify that the Name you have chose for your new Texas Foreign Corporation is available
before we submit
your Foreign Corporation filing to the Texas Secretary of State.
If necessary we can register a Assumed Name in Texas for you so that you can open your new Texas business as quickly as possible.
What do I have to do BEFORE Form a Foreign Corporation in Texas?
- Prove that you are registered in a state other than Texas as a Domestic Corporation
In order to register as a Foreign Corporation in the state of Texas, you must first prove that you are registered in another state as a
Domestic Corporation.
- Choose a name for your Texas Foreign Corporation
You can use the same name in Texas that you use in your home state, however, if the name of your Domestic Corporation is not available you need to choose another name.
Your Texas Foreign Corporation name can identify the type of products and services your business will provide;
or it may be the name of the founder; or it can be a combination of the two or something else.
In any case, the Texas Foreign Corporation name that you choose must be distinguishable from the name of any other registered Texas Corporation or other
business entity and the name must also be different from any reserved names on record with the state of Texas.
Your Texas Foreign Corporation name must not imply that it was formed for a purpose other than that stated in the
Your Texas Foreign Corporation name must not be a name that is likely to mislead the public.
The name of a Texas Foreign Corporation must include the word "Foreign Corporation" or
"Incorporated" or an abbreviation of one of these words.
It's important to choose a good name for your Texas Foreign Corporation because if you want to change it after you qualify you
will have to file amended documents with the Texas Secretary of State (and pay a fee).
We will check to make sure that your requested Texas Foreign Corporation name is available and conforms to all state of Texas
Foreign Corporation naming regulations.
- Select an official address and a Registered Agent for your Texas Foreign Corporation
Every Texas Foreign Corporation must have an address that is physically located in the state of Texas.
This address is "registered" with the Texas Secretary of State.
The Registered Address cannot be a PO Box and is where official and legal correspondence can be delivered.
The individual or company that is registered with the state of Texas to receive all correspondence on behalf of the Texas
Foreign Corporation is called a "Registered Agent".
You may act as your own Registered Agent, however, many Texas Foreign Corporations hire a Registered Agent because they don't have a physical
address within the state of Texas or to provide a distinct level of privacy.
We provide Registered Agent services in Texas as well as in all other states.
- File Registration Documents with the Texas Secretary of State
In order to Qualify as a Foreign Corporation in Texas you must file Registration Documents with the Texas Secretary of State.
In Texas the registration documents are named "Application for Registration of a Foreign For-Profit Corporation".
The registration documents must include certain specific information about your Texas business.
If the Registration Documents do not conform exactly to state of Texas requirements they will be rejected.
If you need to change any of the information on your registration documents after your Texas Foreign Corporation has been approved,
you may amend the registration documents for your Texas Foreign Corporation but you will have to pay a fee to
the state of Texas in order to make the changes official.
- Determine how you want your Texas Foreign Corporation to be taxed
You may choose that your Texas Foreign Corporation to be taxed as a C Corporation or S Corporation.
A C Corporation is what you may think of as a traditional Corporation like General Electric or Ford.
C Corporations pay a Corporate income tax to the state if that state taxes Foreign Corporations.
You may choose to have your Texas Foreign Corporation taxed as a S Corporation.
S Corporations "pass through" all corporate profits to the shareholders (owners) who then pay tax at their applicable personal rate.
S Corporations do not pay any Texas Corporate Income Tax.
Texas does not collect personal or Corporate Income Tax.ÂÂ
However, a Texas Corporation must pay the Texas Corporate Franchise Tax.
The Texas Corporation Franchise Tax is based on the Texas Corporation's taxable margin.ÂÂ
Margin should equal the least of three calculations based on eligibility:
- Total revenue minus cost of goods sold
- Total revenue minus compensation
- Total revenue times 70 percent
The Texas Corporation Franchise Tax rate is 1% for most Texas Corporations.
We can prepare the S Corporation election form for your Texas Foreign Corporation and include it with
your final Foreign Corporation documents package.
What do I have to do AFTER I Form a Foreign Corporation in Texas?
- Obtain Business Licenses from the cities and counties in which you plan to do business
Note that forming a Texas Foreign Corporation does not take the place of obtaining a local business license, tax
registration certificate, or other required business permits.
A Texas Foreign Corporation merely creates an ownership structure that limits the owners' personal liability.
You may still need to take care of getting set up to do business with your local government.
Depending on the nature of the business and the location of your Texas Foreign Corporation within Texas you may need to get one or more local
business licenses or permits.
The business licenses or permits that are required for your Texas Foreign Corporation vary depending on your business activities
and the specific locations within the state of Texas in which you want to conduct business.
If your Texas Foreign Corporation will be selling products in Texas you may be required to obtain a Reseller's Permit from the appropriate
Texas state agency.
If your Texas Foreign Corporation will be selling products in Texas you will also be responsible for all applicable local and state of Texas
sales taxes if there are any.
We have the expertise to find out exactly which state and local permits that you need for your specific business.
- File the required reports for your Texas Foreign Corporation
An Initial report must be filed with the Texas Secretary of State at most one year and 89 days after the date on which the Texas Corporation was authorized.ÂÂ
An Annual Report must be filed with the Texas Secretary of State each year.ÂÂ
In addition, a Public Information report must be filed each year with the Texas Comptroller, which will then be forwarded to the Secretary of State.
The Texas Corporation Annual Report includes basic information about your Texas Foreign Corporation including information on your Officers and Directors.
Failure to submit a properly completed Texas to the Texas Secretary of State on or before the
due date may subject the Texas Foreign Corporation to being administratively dissolved in the state of Texas or having its authority to
transact business in the state of Texas revoked by the Texas Secretary of State.
Penalties may accrue if you fail to file any Texas Foreign Corporation to the Texas Secretary of State by the due date.
- Keep proper records of your Texas Foreign Corporation on file
Keep the following records on file and available at the principal business office of your Texas Foreign Corporation:
- Names and addresses of all Directors and Officers of the Texas Foreign Corporation
- Foreign Corporation formation documents and any Amendments to them
- Corporate Bylaws and any Amendments to them
- List of current shareholders of the Foreign Texas Foreign Corporation.
If shareholders change, keep a record of old shareholders and how stock was transferred.
- Minutes of all Meetings of Shareholders and Directors
- Copies of any Corporate Resolutions which have been adopted by the Texas Foreign Corporation
- Copies of all tax returns and Annual Reports for the Texas Foreign Corporation for the last 3 years
- Pay your taxes to the state of Texas
Foreign Corporations that either do business in the state of Texas or that derive income from sources within the state of Texas are subject
to Texas and federal tax laws.
If you are engaged in intrastate business and derive income from other states besides Texas, you must allocate the amount of income derived
from the state of Texas in order to determine your Texas state taxes.
What information do I need in order to Form a Foreign Corporation in Texas?
In order to Form a Foreign Corporation in Texas you'll need the following information about your new Company:
- The name of your new Texas Foreign Corporation along with your second choice of a name in case the name that you want is not available
- Physical address of the Foreign Corporation office in Texas (not a PO Box)
- A description of the nature of the business you are planning to operate with the Texas Foreign Corporation
- When the Texas Foreign Corporation will start and when it will cease to exist (normally the Foreign Corporation starts on the date the application is filed and will exist perpetually)
- Names and addresses of the initial Directors of the Texas Foreign Corporation
Remember -
ALL the information that you provide when you Form a Foreign Corporation in Texas becomes part of the public record.
Our data entry forms include the
absolute minimum amount of information that is required in order to Form a new Foreign Corporation in Texas.
How long does it take to Form a Foreign Corporation in Texas?
Processing times for new Texas Foreign Corporation applications vary depending on the work load of the
Secretary of State's staff.
We've found that normal processing of new Texas Foreign Corporation applications takes the state around 5-7 business days.
Add 2-3 days for the time period for shipping the final documents by mail.
Choosing our Express Mail option can shave a couple of days off the total processing time for your new Texas Foreign Corporation.
PLEASE NOTE: WE CANNOT GUARANTEE TEXAS SECRETARY OF STATE PROCESSING TIMES.
The Texas Secretary of State reserves the right to extend expedite periods in time of extreme volume, staff shortage or
equipment malfunction.
We are dependent on, and have no control over, the staff and systems of the Texas Secretary of State.
In our experience 5-7 business days is the time it
usually takes the Texas Secretary of State to process
a new Texas Foreign Corporation application.
We get your Texas Foreign Corporation application to the TX Secretary of State ASAP.
Once it is at the state we have no control over the new Texas Foreign Corporation application process.
How much does it cost to Form a Foreign Corporation in Texas?
The state of Texas charges $817.00 to Form a Foreign Corporation in TX.
That includes the Secretary of State's filing fee and a Certified Copy of your new Texas Foreign Corporation filing.
If you choose us to help you Form your Foreign Corporation in Texas our processing fees are $145.00.
This includes:
- Same day processing of your new Texas Foreign Corporation order
- TX Name Check and Verification
- Prepare Application for Registration of a Foreign For-Profit Corporation
- File Formation Documents with the Texas Secretary of State
- Certified Copies of Formation Documents
- Texas Foreign Corporation Checklist
- Priority Mail Delivery
- Unlimited Customer Support
If you are ready to Form a Texas Foreign Corporation, choose which Texas
Foreign Incorporation options that you want below then click the Next Step button.
If you have any questions regarding our Texas Foreign Incorporation services you can call us at
855-771-2477 or email us at
CorpServices@AllBizDocs.com.
Texas Foreign Corporation Cost Estimator
Our Texas
Foreign Corporation Services include:
(These services are included in our processing fees)
Optional Texas
Foreign Corporation Services
(Choose options, cost is updated automatically)
-
Expedited Service - $25
explain
Normal processing time for a new Texas Foreign Corporation is 5-7 business days.
For an additional $25 the Texas Secretary of State will guarantee processing your application for a new Texas Corporation within one day.
This is the time by which the Texas Secretary of State will either approve or deny the Foreign Corporation application.
Texas Foreign Corporation applications must be received by the Secretary of State before noon Texas time for the process to start that day.
Another way to expedite your order is to choose the Express Mail option.
The Express Mail option can cut the document delivery time in half.
- Express Mail - $35
explain
If you really need your original approved Application for Registration of a Foreign For-Profit Corporation in your hands quickly, the
Express Mail option can cut the delivery time in half.
The Express Mail option has no effect on the Texas Secretary of State's processing time. For the quickest turn-around time also choose the Expedited Service option.
-
S Corporation Election - $50
explain
S Corporations are taxed differently than C Corporations.
With an S Corporation, business profits may be "passed through" directly to the shareholders.
This avoids the double tax on both corporate and shareholder profits.
S Corporations do not pay any Texas Corporate Income Tax.
We can prepare the S Corporation Election form for you and include it with your final Foreign Corporation documents pakage.
-
TX Registered Agent - $135
explain
Every Texas Foreign Corporation is required to have an address within the state of Texas where
official and legal correspondence can be delivered.
The individual or company that is registered with the state of Texas to receive all correspondence
on behalf of the Foreign Corporation is called a Registered Agent.
You may act as your own Registered Agent, however, many Foreign Corporations hire a Registered Agent because they don't have a physical address within
Texas or to provide a distinct level of privacy.
We can act as your Texas Foreign Corporation Registered Agent.
This is an annual service.
We will forward all correspondence to you and will remind you when it is time to renew your TX Registered Agent services.
-
TX Good Standing Certificate - $33
explain
A Texas Good Standing Certficate is proof of the existence of your new Texas Foreign Corporation.
The Certificate is issued by the Texas Secretary of State and is proof that your TX Foreign Corporation is not behind on any
of its Texas Secretary of State Corporate obligations.
A Texas Good Standing Certificate is often required for loans, to apply for business licenses, or for tax or other business purposes
in the state of Texas or in any other state.
We can get your Texas Good Standing Certificate immediately after the Texas Secretary of State has approved your Foreign Corporation filing.
-
Federal EIN - $65
explain
An FEIN is like a Social Security Number for your Texas Foreign Corporation.
We can get your FEIN on the same day that your Application for Registration of a Foreign For-Profit Corporation are approved by the Texas Secretary of State.
You can get your FEIN before your articles are approved by the Texas Secretary of State but it's a good idea to wait until
after approval.
Your filing may be rejected or the Foreign Corporation name that you want may not be approved.
Changing information on an FEIN filing is not a trivial exercise with the IRS.
-
Foreign Corporation Kit and Seal - $99
explain
While you're not required to have a Foreign Corporation Kit and Seal for your new Texas Foreign Corporation they do come in handy.
The TX Foreign Corporation Kit consists of a beautiful customized binder, stock certificates, a stock ledger
and your custom Foreign Corporation Seal.
The Foreign Corporation Seal is used to emboss important company documents, such as stock certificates.
The binder also includes dividers so you can use it for all of your Texas Foreign Corporation record keeping.
-
Business License Research - $175
explain
Most new Texas Foreign Corporations are required to get some kind of state, regional or local permits or business licenses.
The task to figure out exactly what you need can be daunting.
We can determine exactly which forms you need to fill out, fill them out for you and file the forms with the appropriate government agency
where possible.