Starting a business is a big step packed with lots of risks and daunting procedures. But then again, The Lone Star State stands by new entrepreneurs, like you, to make the whole process less overwhelming. This allows you to focus on other aspects of your new business rather than get stuck in legal red tape.

As part of your general plan, you will also need to find a suitable location for your business and outline financial options which will help you meet your short-term needs and long-term goals. So, without further ado, here is a straightforward overview explaining how you can open your first business in Houston, Texas.

1. Decide on your business’s legal structure

You have six basic options when it comes to choosing a legal structure for your business. These include Sole proprietorship, general partnership, Corporation, Limited Liability Company (LLC), Limited Partnerships and Limited Liability Partnership.

Sole proprietorship and partnerships may sound exciting, but you are advised to pick Limited Liability Company (LLC) as your firm’s legal structure.

This is because LLC separates your assets, such as lands and houses, from your company. Such a feature might come in handy in case someone sues your business.


2. Choose a business name

It might sound simple, but this is one of the most daunting tasks when it comes to starting a business. Endless complications can arise if you pick the wrong business name. You always have the option to select any name and change it later, but you’d rather utilize that time doing something constructive for your business.

Make sure you pick a unique and easy-to-pronounce business name.

3. Register your business

Now that you have figure out a name for your business, it’s time to register it. Every state has its requirements for registering small businesses.

To register your business in Houston Texas, either;

The county clerk’s office should be in the same geographical location as your business. At the clerk’s office, you’ll be required to fill an Assumed Name Certificate with your business’s necessary information including the business type and name, mailing address, owner’s information, and anticipated period of operation.


To register a limited liability company, you will be required to fill a certificate of formation. You fill this certificate with the Texas secretary of state. Even more, the secretary of state will provide a form that meets minimum state law requirement.

To fill in the certificate of formation online, visit SOSdirect.

4. Obtain business permits and licenses

The next step is attaining necessary business permits and licenses. Permits and licenses indicate that Houston authorities allow you to do business in the City. To stay on the safe side, apply for;

  • A sales tax permit with the CPA (Comptroller of Public Accounts)
  • Regulatory permits and licenses. These cover construction, health, safety and specific industries.
  • Professional and occupational licenses. These would cover individuals working in numerous fields.


5. Get your Employer Identification Number (EIN)

Apply with the Internal Revenue Service to acquire your EIN. Authorities use your EIN to keep track of your business dealings the same way they use your social security number to make sure you file your income tax returns.

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