Texas Business Formation Questions & Answers

Q: Can I conduct business in a different state than the one I am incorporated in?

1 Answer | Asked in Business Formation for Texas on
Answered on Sep 15, 2018
Matthew Valley's answer
Generally speaking, yes. However, the state you want to do business might require you to register your business with them, to obtain a license for your type of business, to register for sales tax, etc. You should consult an attorney in the jurisdiction you are wanting to do business in to see what requirements apply to you and your business.

Q: I have a DBA w/an EIN. I want to start another business. Do I need an LLC to house them? Or can they stand alone?

1 Answer | Asked in Business Formation for Texas on
Answered on Aug 7, 2018
Stefan Dunkelgrun's answer
You could create a parent company entity, or you could create standalone entities. Both would be viable strategies, depending on your concerns and the risks related to the businesses.

The appropriate type of entity is very much dependent upon the situation. An LLC may not be the appropriate solution, and you should consult with an experienced attorney to discuss the pros and cons of the different options available to you.

Q: I live in TX, but am buying a property in KY with a newly formed KY LLC. Do I need to qualify the LLC in Texas?

1 Answer | Asked in Business Formation for Texas on
Answered on Jun 29, 2018
Benton R Patterson III's answer
There are specific requirements governing when a business entity must register to conduct business in Texas. An attorney would need to know all the facts about the business to answer this question. The address of the business is not the registered agent's office. Typically, the business address is listed in its formation documents. If it is not, the business may not have been set up properly.

Q: How should I legally start structuring a record label business, register trademark and copyright?

1 Answer | Asked in Copyright, Trademark and Business Formation for Texas on
Answered on Jun 1, 2018
John Espinosa's answer
This is a very complex and specific question that cannot be fully addressed on here. As a starting point, this government resource explains the basics of copyright and trademark in the music industry:

https://www.uspto.gov/learning-and-resources/ip-policy/musicians-and-artists-profile

Read that, then go hire an entertainment lawyer with expertise in the music industry to best advise you on the details.

Q: Starting a after school program at a school district. Wanting to know how to get a contract developed between partners.

1 Answer | Asked in Contracts, Employment Law, Business Formation and Education Law for Texas on
Answered on May 14, 2018
Benton R Patterson III's answer
An attorney would need to know more about the program to advise on what type of business structure to use. There are many factors to consider when forming a business. It would be best to have a lawyer review a contract with a school district.

Q: Will others be barred from using my business's name if I file a certificate of formation?

1 Answer | Asked in Business Formation for Texas on
Answered on May 8, 2018
Benton R Patterson III's answer
If you register a business name in Texas, the Texas secretary of state will not let someone else register the same name in Texas. However, someone could register that name in another state or use it as a trade name. Registering a business name does not provide trademark rights. If you want to prevent others from using the name, you should speak with a trademark attorney about how to protect your rights in the name.

Q: Hi, I am planning to convert my Sole P into an LLC here in Texas. And I also have about 21 sales tax permits. I plan to

1 Answer | Asked in Tax Law and Business Formation for Texas on
Answered on Apr 23, 2018
Benton R Patterson III's answer
Most states require companies that sell products in the state to register to conduct business in the state. An LLC that is not properly registered to conduct business and intermingles transactions with a sole proprietor has a decent chance of losing its ability to shield the owner or owners from liability.

Q: My friend and I want to open a join business account. We will be opening it with a DBA but I'm concerned about banking

1 Answer | Asked in Banking, Business Formation and Business Law for Texas on
Answered on Apr 20, 2018
Benton R Patterson III's answer
Generally, a contract is only binding on the parties who sign the contract. If the bank is not a party to the contract, it does not have to follow it. You and your business partner can contractually agree to limit the money each of you can withdraw from the account. However, you would not be able to enforce the contract against the bank because the bank is not a party to the contract.

Q: Should a contractor (doing office work) form an LLC?

1 Answer | Asked in Business Formation for Texas on
Answered on Jan 29, 2018
Benton R Patterson III's answer
If you don't do anything to create liability, probably not. Depending on how much money you make, there may be tax advantages to having your income pass through a business entity that is taxed as an S corporation.

Q: Do I need to hire an attorney to create an LLC?

1 Answer | Asked in Business Formation for Texas on
Answered on Jan 29, 2018
Benton R Patterson III's answer
The state of Texas does not require a person to hire an attorney to organize an LLC. But, there are so many mistakes that can be made, it is unlikely that an LLC, or any business entity, formed and managed without legal counsel will be effective in the long run or in the face of litigation.

Q: I created an LLC. I submitted a 2553 to become an s-corp. What do I do for franchise taxes?

1 Answer | Asked in Business Formation and Tax Law for Texas on
Answered on Nov 17, 2017
Jack Ternan's answer
If you created the LLC in Texas, the Comptroller's office normally sends a mailer to the registered agent's address with information on how to file franchise tax reports and pay any amounts owed.

Q: What does it mean when a company name is trademarked?

1 Answer | Asked in Business Formation, Business Law and Trademark for Texas on
Answered on Sep 7, 2017
Benton R Patterson III's answer
It depends on whether consumers are likely to be confused about the source of the trademark owner's goods/services. If both companies sell off-road equipment, you are likely infringing on the other company's trademark, even if you successfully register the business name in Texas.

Q: Can a trademarked name hold title as a grantor of personal property being deeded to grantee an Llc?

1 Answer | Asked in Business Formation, Trademark and Business Law for Texas on
Answered on Sep 6, 2017
Benton R Patterson III's answer
A trademark is not a legal entity and cannot hold title to other property.

Q: Should my mortgage company foreclose my house if I filed for bankruptcy and informed them about it with my case #?

1 Answer | Asked in Bankruptcy, Business Formation and Foreclosure for Texas on
Answered on Aug 4, 2017
Nels Hansen's answer
If this was your first case the mortgage company should not have foreclosed while the automatic stay was in place. The automatic stay is in force from the time the case is filed until it is lifted or your case is dismissed. Getting locked up does not terminate the stay. Having your case dismissed terminates the stay.

Once the stay is terminated all creditors are free to resume collection activities including but not limited to repossession and foreclosure. If this was your second or...

Q: What's the fastest way for me to incorporate my new business? How long will it take?

1 Answer | Asked in Business Formation for Texas on
Answered on Jul 20, 2017
Glenn B. Manishin's answer
There are many online incorporation firms that will handle the paperwork for C Corp. or LLC formation, typically in about 2-3 business days or quicker with expedited service. You do not need to be a Texas corporation to do business in the state, just registration as a "foreign" company with an in-state registered agent.

Q: More than a year ago. I hired a business consultant.

1 Answer | Asked in Business Formation for Texas on
Answered on Jan 17, 2017
Glenn B. Manishin's answer
The refusal to deliver the contracted business plan is a breach of contract. You can sue the consultant and claim damages of the difference between what you paid him and what it costs to have another consultant prepare the business plan, plus restitution of what you paid under the contract and, if not barred by the contract language, consequential damage to your business. Sometimes a demand letter from counsel can yield a consensual resolution of such disputes without the need to litigation.

Q: Hi Can I use the word "dental clinic" in my teeth whitening business name? I'm not using dentist or dentistry..Thanks

1 Answer | Asked in Consumer Law, Business Formation and Legal Malpractice for Texas on
Answered on Sep 9, 2016
Peter Munsing's answer
I think the Texas Dental Associatioon would view it as holding yourself out as a dentist. Because "clinic" is defined as a place that renders outpatient treatment, you could have problems with state agencies. Further, if you aren't a dentist I hope you have a good liability insurance policy because if something happens with the procedure to the person's gums or teeth they will be looking at you and if you don't have coverage will be filing complaints with the health department and others. And...

Q: I am trying to create a hold harmless agreement with subcontractors, but I'm not currently an LLC.

2 Answers | Asked in Business Formation, Business Law and Contracts for Texas on
Answered on Aug 29, 2016
Peter Munsing's answer
Whoever the contract is with. But you really want to pay for a consultation to review these questions with a business attorney

who focuses their practice on business formation. Your accountant can also have insights.Doing it all yourself off of the web, with all due respect to the vast acument of attorneys on the web, is not the way to go.

Q: I'm wanting to start a non profit to help spay/neuter/vaccinate dogs locally. Can Justia help with the paperwork?

1 Answer | Asked in Business Formation for Texas on
Answered on Aug 9, 2016
Anton Pal Montano's answer
Congrats on the work you are trying to do. Before setting up a 501(c)(3), please consider that running a nonprofit will involve a lot of tax accounting work each year as you make your annual tax reports to the IRS. An attorney can certainly help you with the formation of the nonprofit corporation and drafting of bylaws, but you may want to consult with a CPA about maintaining your tax accounting as you will need to keep track of donations and avoid activities that could require the nonprofit...

Q: Can I buy a plumbing franchise with ok credit?

1 Answer | Asked in Business Formation for Texas on
Answered on Jan 22, 2016
Anton Pal Montano's answer
Buying a franchise can be a good way to enter into a business. Unfortunately, it is difficult to answer your question without more information. Much of the relationship between franchisor and franchisee is contractual. Thus, each franchisor may have specific requirements regarding credit for franchisees. Best of luck to you!

Please note that my answers are for general educational purposes only and do not establish an attorney-client relationship. You should contact an attorney for...

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