What are the steps I need to take in order to form a limited liability company (LLC) in Texas and protect my personal assets from business debts?

In order to form a limited liability company (LLC) in Texas and protect your personal assets from business debts, you should follow these steps:

1. Choose a name for your LLC and check if it is available for use by conducting a name search on the Texas Secretary of State website.
2. File a Certificate of Formation with the Texas Secretary of State. This document must include the name of the LLC, the name and address of the registered agent, the purpose of the LLC, the number of members or managers, and the effective date of formation. The filing fee for the Certificate of Formation is $300 and must be paid at the time of filing.
3. Create an operating agreement for your LLC. While it is not required by law in Texas, it is highly recommended to have an operating agreement as it outlines the roles and responsibilities of the members, describes the ownership and management structure of the LLC, and provides rules for decision-making and dispute resolution.
4. Obtain any necessary licenses or permits required by Texas law for your specific business.
5. Obtain an Employer Identification Number (EIN) from the IRS. This number is required for tax purposes and allows your LLC to hire employees and file taxes.

To protect your personal assets from business debts, it is important to maintain the legal separation between you and your LLC. This can be done by:

• Keeping accurate and detailed records of all business transactions and finances, including separate bank accounts and financial statements
• Avoiding personal guarantees on any business loans or debts
• Properly capitalizing your LLC by contributing enough funds to cover start-up costs and ongoing expenses
• Keeping personal assets separate from business assets and avoiding commingling of funds
• Making sure your LLC complies with all applicable laws and regulations, both at the federal and state level

It is also advisable to speak with a licensed attorney who can provide specific legal advice tailored to your individual circumstances, as there may be potential limitations or exceptions to the advice given.

In summary, to form an LLC in Texas and protect your personal assets from business debts, you should:

1. File a Certificate of Formation with the Secretary of State
2. Create an operating agreement
3. Obtain any necessary licenses or permits
4. Obtain an EIN from the IRS
5. Maintain the legal separation between you and your LLC

By following these steps and taking appropriate precautions, you can protect your personal assets and limit your liability as a business owner.