Texas Certificate of Limited Partnership

A company is a legal entity with the characteristics of limited liability, centralization of administration, indefinite duration and easy transferability of ownership shares. The owners of a corporation are called "shareholders." The people who manage the affairs and affairs of a company are called "directors". However, Crown corporation law provides that shareholders may enter into shareholder agreements to eliminate directors and ensure the management of shareholders. Choosing the best management structure for your business is a decision you make with the advice of a lawyer. The Secretary of State cannot help you. Limited liability company: To limit the liability of its limited partners, a limited partnership may choose to register as a limited liability company. The Secretary of State provides a form for registration as a limited liability company. The online submission of the registration is done via SOSDirect. However, general partners are personally liable for the debts and other obligations of the company (e.B. court decisions). This means that a general partner`s personal property can be confiscated in order to collect a debt or judgment against the SQ. If you are forming a limited partnership, general partners should consider taking out liability insurance to offset this risk.

Another big difference is that the partnership is not a formal business structure, which means you don`t even have to file incorporation documents with the state of Texas or pay a incorporation fee. The partnership is simply formed when the partners start doing business together. Sole proprietorship: The most common and simplest form of business is the sole proprietorship. In a sole proprietorship, only one person carries out a commercial activity without the need for a formal organization. If the business is operated under an assumed name (a name other than the person`s last name), an accepted name certificate (commonly referred to as a DBA) must be submitted to the district clerk`s office in the county where a business location is maintained. If no business premises are maintained, an accepted name certificate must be presented in all counties where business is conducted under the adopted name. The limited liability company (LLC) is not a partnership or corporation, but a separate type of corporation that has the powers of a corporation and partnership. Depending on how the LLC is structured, it can be compared to a general limited liability company or a limited partnership where all owners are free to participate in the administration and all have limited liability, or to an "S" company without the ownership and tax restrictions imposed by the Internal Revenue Code. Unlike the partnership, where the key element is the individual, the essence of the limited liability company is the company that requires more formal requirements for its creation. 1 William D. Bagley & Phillip P.

Whynott, The Limited Liability Company, §2.10, (2nd ed. 2d rev. James Publishing, 1995). On the other hand, a limited partnership has a formal incorporation process with the Texas state government, and there are also incorporation fees. Partnership: A partnership is formed when two or more people join forces to operate a for-profit business. A partnership generally operates under a partnership agreement, but it is not necessary for the agreement to be in writing and not a filing requirement of the Crown. If the partnership`s business is conducted under an adopted name (a name that does not include the surname of all partners), an accepted name certificate (commonly referred to as a DBA) must be submitted to the district clerk`s office in the county where a business establishment is maintained. If no business premises are maintained, an accepted name certificate must be presented in all counties where business is conducted under the adopted name. The name of your SQ must include the word "Limited" or "Limited Partnership". You can also use the abbreviation "LP". According to Subchapter C or Chapter 79 of the Texas Administrative Code, some of the words you may not use are "Olympic," "Olympiad," "Citius Altius Fortius," "Bank," "Trust," and/or "War." This list is certainly not exhaustive, so it`s a good idea to check the code before focusing on a specific name that can use a forbidden word. The founding document for the formation of a limited partnership in Texas is called the certificate of formation.

This form must be completed and submitted to the Texas Secretary of State with a $750 training fee. There are four specific sections on this form. Each section is called an "article". The owners of an LLC are called "members". A member may be an individual, a partnership, a corporation, a trust and any other legal or commercial person. In general, members` liability is limited to their investment and they can benefit from the tax treatment passed on to the shareholders of a partnership. Due to federal tax classification rules, an LLC can achieve both structural flexibility and favorable tax treatment. Nevertheless, individuals who wish to form an LLC are well advised to consult competent legal counsel. In Texas, limited partnerships must have a partnership agreement.

A partnership agreement defines the rights and obligations of general partners and limited partners. For example, a partnership agreement may establish procedures for profit distribution, dispute resolution, and termination of the company. While a partnership agreement in Texas can be written or oral, a written agreement is probably in your best interest. In Texas, there is no corporate income tax or personal income tax. In general, this makes taxes at the texas state level relatively easy. Instead, there is a franchise tax for businesses that your limited partnership will likely have to pay. It is usually taxed at a rate of 1% or less. With a limited partnership (not to be confused with the LLC), there is at least one general partner and one limited partner, which is the term for a partner who has no management liability, and their liability is limited to the amount of money they have invested in the partnership. Although not required by law from the State of Texas, a limited partnership agreement outlines some of the company`s key operating principles.

Even if you don`t need to present it to the state to form your SQ, it is still an important document that describes the exact nature of the agreement between general partners and limited partners. Limited Partnership: A Texas Limited Partnership is a partnership formed by two or more persons and having one or more general partners and one or more limited partners. The limited partnership carries on its activities in accordance with a written or oral partnership agreement of the partners on the affairs of the limited partnership and the conduct of its activities. Although the partnership agreement is not publicly submitted, the limited partnership must file a deed of incorporation with the Texas Secretary of State. The Secretary of State provides a form that meets the minimum legal requirements of the state. The online filing of the certificate of incorporation is done via SOSDirect. All legal entities in Texas must have a registered representative. This also includes limited partnerships. If you are forming a limited partnership in Texas, Section 3 of the Certificate of Incorporation requires that you provide the name and physical address of a registered agent based in Texas. A registered representative may be a natural or legal person.

In fact, you can serve as a earned registered agent if you wish. However, if you are acting as your own registered agent, you must have a physical address in Texas. .