Practice Area · Business Entities

The structure
you build on.

Entity formation and ongoing counsel by a 30+ year Texas attorney who has formed and served as general counsel to companies that raised hundreds of millions in capital.

The entity document is the business.

Most founders treat entity formation as paperwork — a box to check with the Texas Secretary of State so the business can open a bank account. That view is wrong, and it costs founders thousands of dollars and occasionally entire companies when it catches up with them.

The entity documents are the business. They determine who owns what, who decides what, who gets paid when, what happens when an owner leaves, what happens when an owner dies, what happens when the company raises capital, and what happens when the company is sold. Generic formation services produce documents that work for an idealized two-founder 50/50 split with no capital events, no disputes, no departures, and no exit. For everyone else, the documents need to be drafted by someone who has seen what goes wrong.

What this practice covers.

LLC formation

Single-member and multi-member LLCs. Articles of organization, operating agreement, initial governance resolutions, member certificates, and registered agent designation. The work is in the operating agreement: capital contributions, distribution rules, allocations of profit and loss, management authority, transfer restrictions, buy-sell provisions, and dissolution mechanics. An LLC with a two-page operating agreement downloaded from a form site is a lawsuit waiting for a trigger.

Corporation formation

C-corporations (for businesses planning to raise institutional capital or that require a C-corp structure for other reasons), S-corporations (for qualifying small businesses seeking pass-through taxation with payroll-tax optimization). Certificate of formation, bylaws, initial board and shareholder resolutions, stock issuance, and shareholder agreements.

Partnership formation

General partnerships, limited partnerships (LPs), and limited liability partnerships (LLPs). Partnership agreements with attention to capital accounts, profit and loss allocations, tax distributions, and the specific partnership form best suited to the business.

Operating agreements and shareholder agreements

The single most valuable document in the entity package. A well-drafted operating agreement addresses: who makes day-to-day decisions versus major decisions; what constitutes a major decision; what happens when owners disagree; what capital calls look like and what happens when one owner cannot fund; transfer restrictions and rights of first refusal; tag-along and drag-along rights; departure events (voluntary, involuntary, death, disability, divorce); and dispute resolution mechanisms. Form operating agreements rarely address most of these thoughtfully.

Buy-sell agreements

Separate from or embedded within the operating agreement. Buy-sell provisions govern what happens when an owner needs or wants to exit — or is forced to. Trigger events, valuation methods, payment terms, and funding mechanisms (life insurance, installment sales, seller financing). A buy-sell with a weak valuation formula creates disputes precisely when the company can least afford them.

Foreign qualification

Registration of out-of-state entities to do business in Texas, or Texas entities to do business in other states. Includes registered agent designation, annual report compliance, and franchise tax considerations.

Dissolution and wind-up

Voluntary dissolution of entities no longer in use; coordination of creditor notifications, final tax filings, asset distributions, and Texas Secretary of State filings. Done improperly, dissolution leaves founders personally exposed to claims that should have been extinguished.

Ongoing compliance and registered agent services

Annual franchise tax and public information reports, registered office maintenance, records updates, and the general health of the entity's corporate housekeeping — work that prevents small administrative lapses from becoming structural problems.

Where this gets complicated

Entity work intersects with tax planning.

Choice of entity is a tax decision as much as a legal one. LLC vs. S-corp vs. C-corp carries different federal income tax consequences, different payroll tax consequences, and different state franchise tax consequences. Getting this right at formation is significantly cheaper than converting later. Because this practice handles both entity formation and tax matters, the analysis happens in one engagement.

Tax Resolution practice
Representative Matters

Entities across sectors and structures.

Representative Matters for entity formation and governance work, when added, will describe anonymized matters by sector, structure, and complexity.

Section reserved. Representative Matters will be added as engagements close and anonymized summaries are approved.

Frequently asked questions.

LLC or S-corp?

An LLC can elect to be taxed as an S-corp; the question isn't usually "LLC or S-corp" but "taxed as a partnership, S-corp, or C-corp." For solo operators with no outside investors, a single-member LLC taxed as a disregarded entity is often simplest. Once self-employment income crosses roughly $80,000–$100,000, the S-corp election often saves payroll tax. For businesses seeking outside investors or venture capital, a C-corp (typically Delaware) is usually required. The right answer depends on the specific financial and ownership picture.

Can I use an online service to form my LLC?

Yes, and many founders do. What you get is the state filing and a generic operating agreement. What you don't get is an operating agreement tailored to your specific ownership structure, capital contributions, distribution intentions, or exit mechanics. For a single-member LLC with no intention of taking on partners, generic forms are often adequate. For any multi-owner business, the operating agreement is where the money is — and where form documents routinely fail.

What if we already formed the LLC but never did an operating agreement?

Common situation. Texas law supplies a default operating agreement for LLCs that don't have one — and the defaults are almost never what founders actually want. Drafting the agreement now, before a dispute arises, is significantly easier than litigating over defaults later.

Do I need a registered agent service?

Every Texas entity must have a registered agent with a physical Texas address. Many founders designate themselves, which works until they move, travel extensively, or want privacy from process servers. A registered agent service is modest annual cost for meaningful operational benefit.

What does entity formation cost?

Simple single-member LLC with a proper custom operating agreement: $400–$800 typical. Multi-member LLC with custom operating agreement covering capital contributions and exit mechanics: $800–$2,500 depending on complexity. C-corp formation with bylaws and shareholder agreement: $1,500–$3,500. Flat fees where scope permits.