To form a professional LLC in Texas, you file a Certificate of Formation for a Professional Limited Liability Company (Form 206) with the Texas Secretary of State and pay a $300 filing fee. Before you file, confirm your license actually requires a professional entity, choose a compliant name, and line up a registered agent. After filing, you still need an operating agreement, an EIN, registration with your licensing board, a federal tax election, and an annual franchise tax filing. Here is how each piece fits together.
Confirm You Need a PLLC, Not a Regular LLC
Texas law defines a “professional service” as any service that requires a state-issued license before you can legally provide it. The Texas Business Organizations Code lists architects, attorneys, certified public accountants, dentists, physicians, public accountants, and veterinarians as examples, and the definition reaches any occupation where licensure is a prerequisite to practice.1State of Texas. Texas Business Organizations Code Section 301-003 If your profession falls into that category, a standard LLC will not work. You need a professional entity: a PLLC, a professional corporation, or a professional association.
The Secretary of State publishes a chart pairing dozens of licensed professions with the entity types each one is allowed to use. Physicians, surgeons, attorneys, psychiatrists, and radiologists are limited to PLLCs and professional associations. Other professions, including massage therapists, embalmers, and funeral directors, can choose between a standard LLC and a PLLC.2Office of the Texas Secretary of State. Guide for Determining Permissible Entity Types for Licensed Professions Check that chart against your specific license before you file anything.
Choose a Compliant Name
Your PLLC’s name must include a designator that signals professional status, such as “PLLC” or “P.L.L.C.”3Texas Secretary of State. Form 206 – Certificate of Formation Professional Limited Liability Company It must also comply with the ethics rules of your licensing body. The Texas State Bar sets its own naming rules for law firms, and other boards may restrict certain terms.4State of Texas. Texas Business Organizations Code Section 5-060
The name must be distinguishable from every existing entity, registered foreign entity, fictitious name, and name reservation on file with the Secretary of State.5Office of the Texas Secretary of State. Name Filings FAQs Check availability through the SOSDirect portal or by contacting the Secretary of State’s office. If you want to lock in a name before you are ready to file, submit a name reservation, which holds it for 120 days.
Appoint a Registered Agent
Every Texas PLLC must designate a registered agent to accept legal documents and state correspondence during regular business hours. The agent can be a Texas resident or a business entity authorized to operate in Texas. An officer, owner, or employee of the PLLC may serve as the agent, but the PLLC cannot be its own agent.6Texas Secretary of State. Registered Agents FAQs
The registered office must be a physical Texas address where the agent can be personally served with process. A P.O. box does not qualify unless it is part of a commercial mail service that is itself the registered agent.7Office of the Texas Secretary of State. Registered Agents Many professionals hire a commercial registered agent service to keep a home address off public filings and cover coverage hours.
File Form 206 with the Secretary of State
The document that legally creates your PLLC is the Certificate of Formation on Form 206. This is separate from Form 205, the standard LLC certificate. Form 206 includes fields specific to professional entities: the type of professional service the PLLC will provide, and a statement that each member or manager who will render professional services holds the required Texas license.3Texas Secretary of State. Form 206 – Certificate of Formation Professional Limited Liability Company
The filing fee is $300.3Texas Secretary of State. Form 206 – Certificate of Formation Professional Limited Liability Company You can file online through SOSDirect, upload the form through SOSUpload, or mail it in. Same-day and next-day expedited service is available for an additional fee.8Office of the Texas Secretary of State. Filing Options
Form 206 asks for:
- The full PLLC name with the proper designator.
- The name and physical Texas address of the registered agent and office.
- A description of the specific professional service the PLLC will provide.
- Whether the PLLC will be member-managed or manager-managed.
- The name and address of the organizer.
Once the Secretary of State approves the filing, you receive a stamped copy of the Certificate of Formation. That document and your EIN are what banks, licensing boards, and other institutions will ask for to confirm the entity exists.
Draft an Operating Agreement
Texas does not require you to file an operating agreement with the state, but skipping it is one of the most common mistakes professionals make. Without one, default provisions in the Business Organizations Code fill the gaps, and those defaults rarely match what the members intended.
A well-drafted operating agreement for a PLLC covers at least:
- Ownership percentages and how new members are admitted.
- How profits and losses are allocated, which may differ from ownership percentages.
- Who makes day-to-day decisions and which decisions require a member vote.
- What happens when a member retires, loses their license, becomes disabled, or dies. This is especially important for PLLCs because all owners must remain licensed.
- Voting rights and what constitutes a quorum.
- Non-compete and restrictive covenants, which come up often in medical practices and law firms.
Banks typically ask to see the operating agreement when you open a business account, and it becomes central if members ever disagree about the direction of the practice.
Handle the Post-Formation Steps
Get an EIN
Your PLLC needs an Employer Identification Number from the IRS before it can open a bank account, hire employees, or file returns. The IRS online application issues the number immediately at no charge; you can also apply by fax or mail on Form SS-4.9Internal Revenue Service. Employer Identification Number The IRS never charges a fee for an EIN, so avoid third-party sites that do.10Internal Revenue Service. Get an Employer Identification Number
Open a Business Bank Account
A dedicated bank account is not optional if you want the liability protection to hold up. Commingling personal and business funds is one of the fastest ways to lose it. Banks generally require your EIN, the stamped Certificate of Formation, your operating agreement, and any business licenses.11U.S. Small Business Administration. Open a Business Bank Account
Register with Your Licensing Board
Filing with the Secretary of State creates the legal entity, but your work is not finished until the PLLC is registered with the relevant professional licensing board. Most Texas boards require the entity to file a registration or obtain approval before it can operate under the PLLC structure. The Texas State Bar requires PLLC law firms to register, and the Texas Medical Board runs its own entity registration process. Contact your board immediately after formation, because practicing through an unregistered entity can create compliance problems.
Pick a Federal Tax Classification
The IRS does not have a separate tax category for PLLCs. Your PLLC is taxed the same way any LLC is, and the default depends on member count. A single-member PLLC is a “disregarded entity,” so income and expenses flow through to your personal return. A PLLC with two or more members defaults to partnership taxation, with each member receiving a Schedule K-1.12Internal Revenue Service. Limited Liability Company – Possible Repercussions
You are not stuck with the default. A PLLC can elect C corporation taxation by filing Form 8832, or S corporation taxation by filing Form 2553. The S corporation election is popular among higher-earning professionals because it can reduce self-employment tax: the PLLC pays member-employees a reasonable salary subject to payroll taxes, and remaining profits pass through as distributions that are not subject to the 15.3 percent self-employment tax. The deadline to elect S corporation status for the current tax year is two months and 15 days after the tax year begins, or March 15 for calendar-year filers.12Internal Revenue Service. Limited Liability Company – Possible Repercussions The right election depends on income level, member count, and how much money members plan to take out beyond salary, so a tax advisor who works with professional practices is worth the fee in year one.
File Your Franchise Tax Report Every Year
Texas has no personal income tax, but it does levy a franchise tax on most business entities, including PLLCs. Franchise tax reports are due May 15 each year.13Texas Comptroller of Public Accounts. Franchise Tax Overview For the 2026 report year, PLLCs with annualized total revenue of $2.65 million or less owe no franchise tax and are not required to file a No Tax Due Report. Entities below that threshold must still file a Public Information Report or Ownership Information Report with the Comptroller.14Texas Comptroller of Public Accounts. Texas Franchise Tax Report Forms for 2026
Missing the May 15 deadline or failing to file the Public Information Report brings penalties, and a prolonged failure can lead the Comptroller to forfeit your entity’s right to do business in Texas. Reinstatement requires clearing every outstanding report and paying back taxes and penalties.
Beyond franchise tax, keep the entity in good standing by maintaining accurate records, holding any meetings or votes your operating agreement calls for, and promptly updating the Secretary of State if your registered agent or office address changes.
How PLLC Liability Protection Actually Works
A PLLC shields its members from the business debts and general liabilities of the company, much like a standard LLC. Malpractice is the exception. The entity itself is jointly and severally liable when an owner, employee, or agent commits an error or negligent act while providing professional services, and the person who committed the act is personally on the hook. Other owners who had nothing to do with the mistake are shielded from that particular liability.15State of Texas. Texas Business Organizations Code Chapter 301
In a three-physician PLLC, a malpractice suit arising solely from Member A’s treatment of a patient reaches Member A and the entity, but not Member B’s personal assets. That is why licensed professionals form PLLCs rather than general partnerships, where every partner would be exposed. Most professionals also carry malpractice insurance on top of the PLLC, since the entity structure does not protect the individual who made the error. It is also why the buyout and license-loss provisions in your operating agreement matter: if a member loses their professional license, Texas law requires the PLLC to address that member’s ownership interest, and you want the mechanics written down before the situation arises.