How to Turn a Texas Sole Proprietorship or DBA into an LLC (2026 Step-by-Step)

01 / The direct answer

Texas has no form that converts a sole proprietorship. You form a new LLC (Form 205, $300 state fee), then move the business into it: a new assumed name filing under the LLC, a new sales tax permit, and possibly a new EIN.

Official source: Texas Secretary of State

Last reviewed: October 30, 2026

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02 / Follow the decisions

Start with the right question.

New entity, not a conversion

Form 630 conversion fees apply to entities converting, such as corporation to LLC ($300 + $300 = $600). A sole proprietorship is not an entity, so form a new LLC with Form 205 ($300).

Official source: Texas Secretary of State

County name filing or SOS filing?

A sole proprietor files with the county clerk in each county where it has premises or does business. Since Sept. 1, 2019, an LLC files its assumed name only with the SOS.

Official source: Texas Secretary of State

Does the EIN restart?

A disregarded single-member LLC may not need a new EIN in some cases, but does if it has employees, excise tax, or elects corporate/S-corp treatment. Check the IRS’s “When to get a new EIN” page for your situation.

Official source: Texas Secretary of State

03 / Before you proceed

Your preparation checklist

Search the name; the LLC name must be distinguishable at the SOS.
File Form 205 ($300).
Sign a company agreement.
Decide EIN with the IRS guidance.
Apply for the LLC's sales tax permit; close the sole-prop permit after the switch date.
File Form 503 if the LLC will keep using the old trade name; abandon the county certificate.
Move bank accounts, contracts, insurance and city/state licenses.
Note the first franchise tax/PIR report is due May 15 of the year after formation.

Common trap: Keeping the old county DBA alive after the LLC starts trading leaves the public record pointing to you personally, which undermines the liability shield you just paid for.

Common trap: Do not collect sales tax under the old personal permit after the LLC takes over.

Official source: Texas Secretary of State

LLC formation from $149 + $300 state fee. Add the corporate kit ($79) for the company agreement and records.

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Assumed name filing

Abandon the old name in the right place

Abandon the sole-proprietor certificate with the county clerk. Form 504 ($10) abandons an SOS assumed-name certificate, not the old county certificate. Assumed-name filings last up to 10 years under Bus. & Com. Code ch. 71.

04 / Your decision tool

How to Turn a Texas Sole Proprietorship or DBA into an LLC (2026 Step-by-Step) checklist

0 of 8 complete

Search the name; the LLC name must be distinguishable at the SOS.File Form 205 ($300).Sign a company agreement.Decide EIN with the IRS guidance.Apply for the LLC's sales tax permit; close the sole-prop permit after the switch date.File Form 503 if the LLC will keep using the old trade name; abandon the county certificate.Move bank accounts, contracts, insurance and city/state licenses.Note the first franchise tax/PIR report is due May 15 of the year after formation.

05 / Facts & fees

Keep the requirements separate.

Texas facts at verification date; confirm current requirements before filing.
Item	Sole proprietor today	After the LLC exists
Legal owner	You personally	The LLC
Business name	County DBA certificate	Use the LLC's legal name, or file Form 503 with the SOS ($25) for a trade name
Old county DBA	Filed with county clerk	File an abandonment with that county clerk
Sales tax permit	In your name	New permit for the LLC; close the old one
EIN	Yours (or SSN)	Depends on employees/tax election; see IRS
Bank account, contracts, licenses	In your name	Re-open or assign to the LLC